Platinum Studios Reports Fiscal 2007 Financial Results, Business Update, and Outlook
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LOS ANGELES--(Business Wire)-- Platinum Studios, Inc. (OTCBB: PDOS), an entertainment company that controls an international library of more than 5,600 comic book characters, which it adapts and produces for film, television and all other media, today reported financial results for the fiscal year ended December 31, 2007. For the year ended December 31, 2007, Platinum reported net revenues of $1.96 million compared to net revenues of $0.18 million for fiscal year 2006, representing a year-over-year increase of more than 1000%. The increased net revenues were primarily attributable to an increase in option and acquisition fee revenue of $0.86 million and first look revenue of $0.45 million. The Company is currently focused on exploiting its large library of intellectual property. The option and acquisition fee revenue is the result of a major Hollywood Studio's interest in one of these properties. For the year ended December 31, 2007, cost of revenues was $0.28 million compared to $0 for the year ended December 31, 2006. The increase is primarily due to printing costs for comic books. In 2006 printing costs were included as part of the licensing agreement with Top Cow Productions, Inc. and thus, printing costs were not incurred by the Company in 2006. The Company also reported an increase in operating expenses of $2.0 million or 63% for the year ended December 31, 2007 to $5.2 million, as compared to $3.17 million for fiscal year 2006. The increase was due to increases in payroll, promotion and merchandising costs, which were incurred to support the growth of the Company. Research and development costs increased $0.19 million or 26% for the year ended December 31, 2007 to $0.96 million, as compared to $0.76 million for fiscal year 2006. The increase was due to development of additional intellectual properties. Depreciation and Amortization For the year ended December 31, 2007 depreciation and amortization was $165,861 compared to $73,486 for the year ended December 31, 2006. The increase is due to amortization of character rights and additional capital leases for computer equipment. As a result of the foregoing, the net loss increased by $848,938 for the year ended December 31, 2007, to $5,121,718 or -$0.025 per share, as compared to $4,272,780 for 2006. "Over the past year, we have experienced success in all aspects of our business, and the increase of our revenue in 2007 demonstrates that our multi-dimensional exploitation strategy is working, and our company is growing," said Scott Mitchell Rosenberg, Platinum's Chairman and CEO. "I am confident that our growth will continue in 2008 as our properties are introduced across all media outlets around the world." Brian Altounian, Platinum's President and COO, provided insight into the implementation of the company's business strategy in the coming year saying, "We expect that our company's revenue growth in the coming year will be driven primarily by ongoing successful developments in our Filmed Entertainment division and our Print Publishing division, while the initiatives in the Digital Publishing division hold the potential for significant revenue contributions later in the year." Mr. Rosenberg continued, saying, "The long term growth of these revenue generating areas is dependent upon the ongoing creation of new characters and engaging and exciting story lines drawn from our ever growing Intellectual Property library of characters. To that end, our DrunkDuck.com site and The Comic Book Challenge(TM) continue as innovative and successful venues that bring the most creative new authors and most compelling story lines into Platinum Studios." Operating Highlights Product Development and Intellectual Property - In preparation for securing a library asset valuation from an independent valuation firm, we took a new inventory count on our character list to account for all characters and properties. The revised number of characters increased to 5,622 as of December 31, 2007 from approximately 3,800 characters as previously disclosed. Print Publishing - The Company expanded its publishing schedule and released 43 comic books and graphic novels in 2007 after releasing only 1 graphic novel in the previous year. In addition, the Company signed a publishing deal with Harper Collins to distribute its debut graphic novel, Cowboys & Aliens. Filmed Entertainment - The Company successfully sold its comic book property, Unique, to Disney Studios and optioned Cowboys & Aliens to Dreamworks in 2007. Digital Publishing - The Company expanded its digital publishing exploitation plan in 2007, launching an online "e-commerce" store to sell merchandise, comic books and other products (store.platinumstudios.com), an online comics site to highlight the printed comics and graphic novels (www.platinumstudioscomics.com), a mobile storefront for distribution of digital content (www.pt78mobile.com), and it expanded DrunkDuck, its web-comics site that hosts the digital distribution of the Company's printed comic material and acts as a resource for independent comics creators to post new material (www.drunkduck.com). In addition, the Company has developed multiple destination sites for individual comic properties. In late 2007, the Company partnered with Comflix to create an online comics video player named Splastk (www.splastk.com) that can be syndicated over a large number of affiliate websites. The Splastk player can serve a large amount of content, delivered over across a wide network of affiliated websites that serve over 100,000,000 monthly page views. Merchandise & Licensing - In 2007, the Company extended its branding philosophy to include the annual "The Comic Book Challenge(TM)," a competition that allows independent creators to pitch original comic book ideas to a panel of live judges. The winning contestant receives a publishing deal with revenue sharing across all distribution outlets. In 2007, the Company signed a corporate sponsorship deal with AT&T and secured other sponsorship arrangements with 5 other corporations to underwrite the event and expose the Company to a wide audience. Corporate Infrastructure - The Company continues to attract and retain the necessary talent to manage its growth, including significant additions to its operations and sales functions. The Company now has 24 full time employees. Business Outlook Print Publishing - The Company is looking to expand broad publishing opportunities to international and other more traditional publishing arrangements. Filmed Entertainment - The Company is partnering with independent film producers to obtain independent financing for producing feature films based on its characters and it anticipates moving forward in production on at least 2 films in 2008. In addition, the Company is formulating a multi-picture film production slate with the intent of raising independent financing and producing those films outside of the established studio system. The Company also intends to continue to pitch its characters and story lines to Hollywood studios and television networks. Digital Publishing - The Company intends to seek to expand revenue opportunities in the area of digital distribution. Initiatives will include new methods of delivery of comic content, advertising and sponsorship opportunities for expanding the network of Platinum-owned and -controlled websites, and the creation of comics-based online casual games, among others. Merchandise & Licensing - In conjunction with film properties, the Company will actively pursue merchandise and licensing opportunities such as toys and apparel agreements, in all markets. The Company also intends to seek agreements for console-based video games based on its titles. Mr. Rosenberg concluded "The upcoming year is an exciting one for us at Platinum Studios and we look forward to sharing our successes with you. Please visit: www.platinumstudios.com/news/index.php for the latest news and updates, and to sign up for our newsletter." About Platinum Studios, Inc. Platinum Studios (OTCBB: PDOS) is an entertainment company that controls an international library of comic book characters from all over the world, which it adapts, produces and licenses for all forms of media including print, film, online, mobile / wireless, gaming, and merchandising. Platinum Studios' library contains more than 5,600 characters spanning a full range of genres and styles, and also includes properties such as www.DrunkDuck.com, the industry's preeminent webcomics community. Working with leading companies in the entertainment and new media sectors, Platinum believes it is well positioned to emerge as one of the front-runners in the creation of new content across all media platforms. Platinum Studios - Comics Fueling Media EVERYWHERE! To learn more about the company and to sign up for our newsletter, please visit our website at http://www.platinumstudios.com/news/index.php . Platinum Studios Safe Harbor Statement Matters discussed in this press release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words "anticipate," "believe," "estimate," "may," "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein. These forward-looking statements are based largely on the expectations of Platinum Studios and are subject to a number of risks and uncertainties. These include, but are not limited to, risks and uncertainties associated with: the impact of economic, competitive and other factors affecting Platinum Studios and its operations; its markets, products, and distributor performance, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently, and other factors detailed in reports filed by Platinum Studios. Platinum Studios, Inc. Media Relations: Nick Alan Jones, 310-807-8155 firstname.lastname@example.org or Platinum Investor Requests: Sean Becker, 702-478-7363 email@example.com Copyright Business Wire 2008