EXHIBIT 99.2
WPT Enterprises, Inc. Recent Results
Financial and operating data discussed below for the three and six
months ended July 4, 2004, in the opinion of management, include all adjustments
(consisting of normal recurring accruals) for a fair presentation of such
information. The results of operations data presented for three and six months
ended July 4, 2004 are not necessarily indicative of the results of operations
for the full 2004 fiscal year.
Six Months Ended Three Months Ended
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June 29, 2003 July 4, 2004 June 29, 2003 July 4, 2004
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Revenues ................................... $ 3,503,630 $ 8,858,279 $ 2,953,630 $ 4,718,647
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Gross Margin ............................... 1,413,592 3,741,028 1,783,398 2,073,087
Expenses:
Selling and Administrative ............ 706,655 1,965,084 401,428 1,163,721
Depreciation .......................... 39,225 66,711 21,270 32,837
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Earnings (Loss) from Operations ............ 667,712 1,709,233 1,360,700 876,529
Interest (Income) Expense .................. 73,784 30,410 37,252 (10,731)
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Net Earnings (Loss) ........................ $ 593,928 $ 1,678,823 $ 1,323,448 $ 887,260
============ ============ ============ ============
Net Earnings (Loss) per Common
Share--Basic .......................... $ .05 $ .12 $ .10 $ .06
============ ============ ============ ============
Net Earnings (Loss) per Common
Share--Diluted ........................ $ .04 $ .10 $ .08 $ .06
============ ============ ============ ============
Weighted Average Common Shares
Outstanding--Basic .................... 13,066,667 13,946,667 13,360,000 14,240,000
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Dilutive Effect of Restricted Stock ........ 1,997,440 1,398,400 1,797,440 1,198,400
Dilutive Effect of Stock Options ........... 932,053 652,053 838,720 558,720
------------ ------------ ------------ ------------
Weighted Average Common Shares
Outstanding--Diluted .................. 15,996,160 15,997,120 15,996,160 15,997,120
============ ============ ============ ============
Total revenues were $8.9 million for the six months ended July 4, 2004
compared to $3.5 million for the comparable period in the prior year. Revenues
for the current and prior year periods were derived primarily from license fees
related to the World Poker Tour series. The increase in revenue is primarily due
to higher per episode license fees received from the Travel Channel for our
Season Two programming and a greater number of episodes delivered to the Travel
Channel during the six months ended July 4, 2004, compared to the per episode
license fee for our Season One programming and the number of episodes delivered
to the Travel Channel during the comparable 2003. Also contributing to the
increase for the 2004 period was revenue of approximately $0.9 million resulting
from our licensing, sponsorship and merchandising activities, compared to no
significant revenue from such activities during the comparable 2003 period.
Our production costs increased from $2.1 million for the six months
ended June 29, 2003 to $5.1 million for the six months ended July 4, 2004. The
increase was also due to a greater number of episodes being delivered to the
Travel Channel during the 2004 period compared to the comparable 2003 period.
Productions costs for the six months ended June 29, 2003 excluded a significant
amount of costs related to episodes delivered in that period that were expensed
as incurred prior to the signing of the Travel Channel contract in March 2003.
The gross margins were comparable for the respective six month periods due to
higher per episode license fees during the 2004 period that were offset by the
exclusion of production costs in the comparable 2003 period.
Our net income for the six months ended July 4, 2004 was approximately
$1.7 million, with basic earnings of $.12 per share and diluted earnings of $.10
per share. This compares with net income of approximately $594,000, with basic
earnings of $.05 per share and diluted earnings of $.04 per share, for the six
months ended June 29, 2003.
Total revenues were $4.7 million for the three months ended July 4,
2004, compared to $3.0 million in the prior year period. Revenues for the 2004
second quarter and comparable prior year periods were primarily derived from
license fees related to the World Poker Tour television series. The increase in
revenue is primarily due to higher per episode license fees received from the
Travel Channel for episodes delivered during the three months ended July 4,
2004, partially offset by fewer episodes delivered during the 2004 period than
during the comparable 2003 period. Also contributing to the increase for the
second quarter of 2004 was revenue of approximately $0.5 million that resulted
from our licensing, sponsorship and merchandising activity, compared to no
significant revenue from such activities during the second quarter of 2003.
Our production costs increased from $1.2 million for the three months
ended June 29, 2003 to $2.6 million for the three months ended July 4, 2004.
Production costs for the three months ended June 28, 2003 excluded a significant
amount of costs related to episodes delivered in that period that were expensed
as incurred prior to the signing of the Travel Channel contract in March 2003.
This resulted in a gross margin of 60% for the three months ended June 29, 2003
compared to 44% for the three months ended July 4, 2004.
Our net income for the three months ended July 4, 2004 was
approximately $887,000, and basic and diluted earnings were $.06 per share. This
compares with net income of $1.3 million, with basic earnings of $.10 per share
and diluted earnings of $.08 per share, for the three months ended June 29,
2003. The decrease was due to the unusually high gross margin for the three
months ended June 29, 2003 and an additional $750,000 of general and
administrative expenses for the three months ended July 4, 2004.