J&S Audio Visual
Selected Quarterly Results of Operations and Reconciliation of Net Income (Loss) to EBITDA, Adjusted EBITDA and Adjusted Net Income (1) (2)
(unaudited, in thousands)
|
| | | | | | | | | | | | | | | |
| | First Quarter | | Second Quarter | | Third Quarter | | Nine Months Ended September 30, 2017 |
| 2017 | | | | | | | |
| Total revenue | $ | 19,382 |
| | $ | 18,938 |
| | $ | 11,951 |
| | $ | 50,271 |
|
| Total operating expenses | 16,791 |
| | 17,468 |
| | 14,069 |
| | 48,328 |
|
| Operating income (loss) | 2,591 |
| | 1,470 |
| | (2,118 | ) | | 1,943 |
|
| | | | | | | | |
| Net income (loss) | $ | 2,201 |
| | $ | 927 |
| | $ | (2,821 | ) | | $ | 307 |
|
| Interest expense | 61 |
| | 58 |
| | 59 |
| | 178 |
|
| Depreciation and amortization | 801 |
| | 860 |
| | 823 |
| | 2,484 |
|
| Income tax expense | 148 |
| | 144 |
| | 462 |
| | 754 |
|
| EBITDA | 3,211 |
| | 1,989 |
| | (1,477 | ) | | 3,723 |
|
Amortization of hotel signing fees (3) | 77 |
| | 77 |
| | 153 |
| | 307 |
|
| Foreign currency transactions (gain) loss | (5 | ) | | (63 | ) | | 23 |
| | (45 | ) |
Acquisition adjustments (4) | 19 |
| | 19 |
| | 19 |
| | 57 |
|
| Transaction costs | 5 |
| | 3 |
| | 50 |
| | 58 |
|
| Adjusted EBITDA | 3,307 |
| | 2,025 |
| | (1,232 | ) | | 4,100 |
|
| Interest expense | (61 | ) | | (58 | ) | | (59 | ) | | (178 | ) |
| Income tax expense | (148 | ) | | (144 | ) | | (462 | ) | | (754 | ) |
| Adjusted net income (loss) | $ | 3,098 |
| | $ | 1,823 |
| | $ | (1,753 | ) | | $ | 3,168 |
|
|
| | | | | | | | | | | | | | | | | | | |
| | First Quarter | | Second Quarter | | Third Quarter | | Fourth Quarter | | Year Ended December 31, 2016 |
| 2016 | | | | | | | | | |
| Total revenue | $ | 18,019 |
| | $ | 19,529 |
| | $ | 11,819 |
| | $ | 12,584 |
| | $ | 61,951 |
|
| Total operating expenses | 15,627 |
| | 16,528 |
| | 13,436 |
| | 13,544 |
| | 59,135 |
|
| Operating income (loss) | $ | 2,392 |
| | $ | 3,001 |
| | $ | (1,617 | ) | | $ | (960 | ) | | $ | 2,816 |
|
| | | | | | | | | | |
| Net income (loss) | $ | 1,994 |
| | $ | 2,542 |
| | $ | (1,994 | ) | | $ | (1,484 | ) | | $ | 1,058 |
|
| Interest expense | 73 |
| | 69 |
| | 64 |
| | 62 |
| | 268 |
|
| Depreciation and amortization | 713 |
| | 724 |
| | 839 |
| | 834 |
| | 3,110 |
|
| Income tax expense | 166 |
| | 180 |
| | 74 |
| | 165 |
| | 585 |
|
| EBITDA | 2,946 |
| | 3,515 |
| | (1,017 | ) | | (423 | ) | | 5,021 |
|
| Non-cash loss | 6 |
| | 6 |
| | 6 |
| | 6 |
| | 24 |
|
Amortization of hotel signing fees (3) | — |
| | 152 |
| | 76 |
| | 79 |
| | 307 |
|
| Foreign currency transactions (gain) loss | 111 |
| | (57 | ) | | 10 |
| | 211 |
| | 275 |
|
Acquisition adjustments (4) | — |
| | 38 |
| | 19 |
| | 19 |
| | 76 |
|
| Transaction costs | — |
| | — |
| | 7 |
| | 17 |
| | 24 |
|
| Adjusted EBITDA | 3,063 |
| | 3,654 |
| | (899 | ) | | (91 | ) | | 5,727 |
|
| Interest expense | (73 | ) | | (69 | ) | | (64 | ) | | (62 | ) | | (268 | ) |
| Income tax expense | (166 | ) | | (180 | ) | | (74 | ) | | (165 | ) | | (585 | ) |
| Adjusted net income (loss) | $ | 2,824 |
| | $ | 3,405 |
| | $ | (1,037 | ) | | $ | (318 | ) | | $ | 4,874 |
|
(1) All historical information in this table is based upon unaudited operating financial data provided by J&S. Consolidated financial statements for J&S have not been prepared and this data has not been audited, reviewed or compiled by the Company’s independent registered public accounting firm. The historical financial information should not be relied upon as an indicator of future performance.
(2) The financial information presented herein includes amounts attributable to 100% of the equity interests of J&S. Accordingly, the amounts attributable to Ashford Inc.'s 85% interest will be lower than the amounts presented.
(3) Hotel signing fees represent incentive payments incurred in connection with signing or renewing venue contracts and generally provide the right to be the exclusive on-site provider of audio-visual services at the hotel. The payments are deferred and amortized over the life of the contract.
(4) Acquisition adjustments represent add-backs for pro forma expenses related to executive management compensation of J&S.
Included in table are certain supplemental measures of performance which are not measures of operating performance under GAAP, to assist investors in evaluating the Company's historical or future financial performance. These supplemental measures include earnings before interest, tax, depreciation and amortization ("EBITDA"), Adjusted EBITDA and Adjusted Net Income. We believe that EBITDA, Adjusted EBITDA and Adjusted Net Income provide investors and management with a meaningful indicator of operating performance. Management also uses Adjusted EBITDA and Adjusted Net Income, among other measures, to evaluate profitability. J&S calculates Adjusted EBITDA by subtracting or adding to net income (loss): interest expense, income taxes, depreciation, amortization, net income (loss) to noncontrolling interests, transaction costs, and other expenses. J&S calculates Adjusted Net Income by subtracting or adding to net income (loss): depreciation, amortization, net income (loss) to noncontrolling interests, transaction costs, and other expenses. J&S's methodology for calculating Adjusted EBITDA and Adjusted Net Income may differ from the methodologies used by other comparable companies, when calculating the same or similar supplemental financial measures and may not be comparable with these companies. Neither Adjusted EBITDA nor Adjusted Net Income represents cash generated from operating activities as determined by GAAP and should not be considered as an alternative to a) GAAP net income (loss) as an indication of our financial performance or b) GAAP cash flows from operating activities as a measure of our liquidity nor are such measures indicative of funds available to satisfy our cash needs. The Company urges investors to carefully review the U.S. GAAP financial information of J&S to be filed in a separate Current Report on Form 8-K.
