Exhibit 99.1
FOR IMMEDIATE RELEASE
AVP, Inc. Announces 2008
Second Quarter Financial Results
LOS ANGELES, August 14, 2008 -- AVP, Inc. (OTC Bulletin Board: AVPI), a lifestyle sports entertainment company focused on professional beach volleyball, today announced financial results for its 2008 second quarter ended June 30, 2008.
Second Quarter 2008 Highlights:
| · | AVP CROCS TOUR - AVP, Inc. kicked off the 25th season of the AVP Crocs Tour, the flagship property of AVP, Inc. The summer-long 18-stop tour brings the world’s greatest beach volleyball athletes and competition to cities across the country. |
| · | Finalized five-year partnership extension with Wilson Sporting Goods Co. to continue as the exclusive official game ball of the AVP Pro Beach Volleyball Tour. |
For the six months ended June 30, 2008, the Company reported revenue of $8.8 million, compared to the $11.0 million reported for the same period in 2007. Net loss for the six months of 2008 was ($3.2 million), or a loss of ($0.16) per share, as compared to a net loss of ($1.2 million), or ($0.06) per share, for the same period last year. Included in the six month net loss of 2008 were a one time charge of $0.3 million related to a third-party service provider and $0.4 million of non-cash transactions related to share based payments for employee option grants.
“The AVP is focused on continuing to build our brand, the fan experience and increasing value to our shareholders,” said Leonard Armato, Chief Executive Officer of AVP, Inc. “We were very pleased with the outcome of the NBC Sports broadcasts of our finals. We have such a strong fan base across the country, we would like to thank our supporters for their attendance and look forward to sharing our sport and bring the world’s best beach volleyball to our fans and spectators.”
“We are confident the performance of our athletes in the Olympic Games will serve as a catalyst for our sport as we continue the summer-long AVP Crocs Tour. We look forward with great anticipation to our flagship event, the historic Manhattan Beach Open in September and also, to the second year of the Hot Winter Nights Tour.”
About AVP, Inc
AVP, Inc. is a leading lifestyle sports entertainment company focused on the production, marketing and distribution of professional beach volleyball events worldwide. One of the fastest growing entities in the sports world, the AVP operates two of the industry's most prominent national outdoor touring series, the AVP Pro Beach Volleyball Tour (1983) and the AVP Hot Winter Nights Indoor Tour (launched in 2008). The AVP is set to stage more than 35 events throughout the United States in 2008 and features more than 150 of the top men and women competitors in the sport. At the 2004 Athens Olympics, AVP athletes representing the United States won gold and bronze. The medals were the first won by the U.S. women in professional beach volleyball, and the 2007 World Champions in each gender are AVP athletes. AVP is headquartered in Los Angeles, Calif., and the company’s stock trades under the symbol AVPI on the OTC Bulletin Board. For more information, please visit www.avp.com.
Forward Looking Statements
Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of the Company. We wish to caution you that these statements involve risks and uncertainties and actual results might differ materially from those in the forward-looking statements, if we receive less sponsorship and advertising revenue than anticipated, or if attendance is adversely affected by unfavorable weather. Event-related expenses, such as for the stadium, transportation and accommodations, or security might be greater than expected; or marketing or administrative costs might be increased by our hiring, not currently planned, of a particularly qualified prospect. Additional factors have been detailed in the Company’s filings with the Securities and Exchange Commission, including our recent filings on Forms 10-KSB and 10-QSB.
AVP, Inc.
Investor Relations
(310) 426-7177
Media Contact:
AVP / Brener Zwikel & Associates
Crystal Fukumoto
818.462.5605/Crystalf@bzapr.com
AVP, INC
CONSOLIDATED BALANCE SHEETS
(Unaudited) June 30, 2008 | December 31, 2007 | ||||||
ASSETS | |||||||
CURRENT ASSETS | |||||||
| Cash and cash equivalents | $ | 1,468,212 | $ | 2,257,453 | |||
| Accounts receivable, net of allowance for | |||||||
| doubtful accounts of $252,347 and $149,748 | 3,283,899 | 2,008,253 | |||||
| Prepaid expenses | 823,631 | 388,649 | |||||
| Other current assets | 38,882 | 116,393 | |||||
| TOTAL CURRENT ASSETS | 5,614,624 | 4,770,748 | |||||
PROPERTY AND EQUIPMENT, net | 438,501 | 392,447 | |||||
OTHER ASSETS | 42,562 | 115,496 | |||||
| TOTAL ASSETS | $ | 6,095,687 | $ | 5,278,691 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | |||||||
CURRENT LIABILITIES | |||||||
| Accounts payable | $ | 1,439,047 | $ | 908,020 | |||
| Accrued expenses | 2,495,424 | 1,663,975 | |||||
| Deferred revenue | 2,470,435 | 101,245 | |||||
| TOTAL CURRENT LIABILITIES | 6,404,906 | 2,673,240 | |||||
NON-CURRENT LIABILITIES | 69,857 | 96,419 | |||||
| TOTAL LIABILITIES | 6,474,763 | 2,769,659 | |||||
COMMITMENTS AND CONTINGENCIES | |||||||
STOCKHOLDERS' EQUITY (DEFICIT) | |||||||
| Preferred stock, 2,000,000 shares authorized: | |||||||
| Series B convertible preferred stock, $.001 par value, 250,000 shares authorized, | |||||||
| 44,944 and 47,152 shares issued and outstanding | 46 | 48 | |||||
| Common stock, $.001 par value, 80,000,000 shares authorized, | |||||||
| 21,089,626 and 20,490,096 shares issued and outstanding | 21,090 | 20,490 | |||||
| Additional paid-in capital | 40,085,313 | 39,732,837 | |||||
| Accumulated deficit | (40,485,525 | ) | (37,244,343 | ) | |||
| TOTAL STOCKHOLDERS' EQUITY (DEFICIT) | (379,076 | ) | 2,509,032 | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | $ | 6,095,687 | $ | 5,278,691 | |||
AVP, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||
2008 | 2007 | 2008 | 2007 | ||||||||||
REVENUE | |||||||||||||
| Sponsorships/Advertising | $ | 6,192,498 | $ | 8,990,790 | $ | 7,068,018 | $ | 8,990,790 | |||||
| Other | 1,635,636 | 1,857,611 | 1,751,106 | 2,026,611 | |||||||||
| TOTAL REVENUE | 7,828,134 | 10,848,401 | 8,819,124 | 11,017,401 | |||||||||
EVENT COST | 5,716,951 | 7,185,169 | 6,761,185 | 7,237,468 | |||||||||
| GROSS PROFIT | 2,111,183 | 3,663,232 | 2,057,939 | 3,779,933 | |||||||||
OPERATING EXPENSES | |||||||||||||
| Sales and marketing (1) | 800,109 | 862,503 | 2,071,764 | 1,738,216 | |||||||||
| Administrative (2) | 1,570,616 | 1,958,237 | 3,241,329 | 3,404,540 | |||||||||
| TOTAL OPERATING EXPENSES | 2,370,725 | 2,820,740 | 5,313,093 | 5,142,756 | |||||||||
| OPERATING INCOME (LOSS) | (259,542 | ) | 842,492 | (3,255,154 | ) | (1,362,823 | ) | ||||||
OTHER INCOME (EXPENSE) | |||||||||||||
| Interest income | 6,014 | 57,520 | 17,203 | 113,977 | |||||||||
| Gain on sale of asset | 3,500 | 1,325 | 3,500 | 9,774 | |||||||||
| Foreign exchange loss | (5,581 | ) | - | (5,581 | ) | - | |||||||
| TOTAL OTHER INCOME | 3,933 | 58,845 | 15,122 | 123,751 | |||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | (255,609 | ) | 901,337 | (3,240,032 | ) | (1,239,072 | ) | ||||||
INCOME TAXES | - | - | (1,150 | ) | (800 | ) | |||||||
| NET INCOME (LOSS) | $ | (255,609 | ) | $ | 901,337 | $ | (3,241,182 | ) | $ | (1,239,872 | ) | ||
| Earnings (loss) per common share: | |||||||||||||
| Basic | $ | (0.01 | ) | $ | 0.05 | $ | (0.16 | ) | $ | (0.06 | ) | ||
| Diluted | $ | (0.01 | ) | $ | 0.03 | $ | (0.16 | ) | $ | (0.06 | ) | ||
| Shares used in computing earnings (loss) per share: | |||||||||||||
| Basic | 21,089,626 | 19,960,250 | 20,812,392 | 19,872,269 | |||||||||
| Diluted | 21,089,626 | 27,596,052 | 20,812,392 | 19,872,269 | |||||||||
(1) Sales and marketing expenses includes stock-based expenses of $18,182 and $9,313 for the three months ended June 30, 2008 and 2007, respectively, and $36,364 and $82,220 for the six moths ended June 30, 2008 and 2007, respectively.
(2) Administrative expenses includes stock-based expenses of $150,051 and $21,596 for the three months ended June 30, 2008 and 2007, respectively, and $353,074 and $42,956 for the six months ended June 30, 2008 and 2007, respectively.