8-K
Bright Mountain Media, Inc. (BMTM)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 11, 2023
Bright Mountain Media, Inc.
(Exact name of registrant as specified in its charter)
| Florida | 000-54887 | 27-2977890 |
|---|---|---|
| (State or other jurisdiction<br>of incorporation) | (Commission<br>File Number) | (IRS Employer<br>Identification No.) |
| 6400 Congress Avenue, Suite 2050<br><br>Boca Raton, Florida | 33487 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: 561-998-2440
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act: None
| Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered |
|---|
Indicate by check mark whether the registrant is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Conditions |
|---|
On May 11, 2023, Bright Mountain Media, Inc, Inc. (the "Company") issued a press release announcing its financial results for its first quarter and Three Months Ended March 31, 2023. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information contained in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1, is being "furnished" and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. In addition, this information shall not be deemed incorporated by reference into any of the Company’s filings with the Securities and Exchange Commission, except as shall be expressly set forth by specific reference in any such filing.
The Company makes reference to certain non-GAAP financial measures in the press release. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures and reasons why the Company believes these non-GAAP financial measures are useful are contained in the attached press release.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(d) Exhibits
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release Issued May 11, 2023 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
May 11, 2023
Bright Mountain Media, Inc.
| (Registrant) | |
|---|---|
| By: | /s/ Miriam Martinez |
| Miriam Martinez | |
| Chief Financial Officer |
Document
Bright Mountain Media, Inc Announces First Quarter 2023 Financial Results
Boca Raton, FL, May 11, 2023 — Bright Mountain Media, Inc. (OTCQB: BMTM) (“Bright Mountain” or the “Company”), a global holding company with current investments in digital publishing, advertising technology, consumer insights, and creative media services, today announced its unaudited financial results for the three months ended March 31, 2023.
Matt Drinkwater, Chief Executive Officer of the Company stated, “2023 has begun as a year of transformation for Bright Mountain. In April, we announced the asset acquisition of Big Village’s Insights and Agency divisions. We believe that data driven consumer insights, which are the core of Big Village Insights, are perfect complements to both our publishing and ad tech divisions. The work of integrating Big Village's proprietary data is well under way and is providing a new, important signal for brands and agencies who depend on consumer insights to fuel their business, marketing, and media decisions."
“Big Village comes with over 200 talented employees and hundreds of customers that we expect will prove synergistic to our existing partnerships to deliver even more value to clients.”
Mr. Drinkwater concluded: “The acquisition is expected to add approximately $50.0 million of annualized revenue and to be accretive to adjusted EBITDA. We plan to use this acquisition as a springboard to accelerating growth and maximizing value to shareholders.”
Financial Results for the Three Months Ended March 31, 2023
•Revenue was $1.5 million, a decrease of $2.0 million or 57% compared to $3.5 million for the same period of 2022.
•Gross margin was $528,000, a reduction of 70%, compared to $1.7 million in the same period of 2022.
•General and administrative expense was $3.4 million, a reduction of 11%, compared to $3.9 million in the same period of 2022.
•Net loss was $3.8 million, an increase of 79%, compared to a $2.1 million net loss in the same period of 2022.
•Adjusted EBITDA loss was $2.1 million compared to a loss of $1.6 million in the same period of 2022.
About Bright Mountain Media
Bright Mountain Media, Inc. (OTCQB: BMTM) unites a diverse portfolio of companies to deliver a full spectrum of advertising, marketing, technology, and media services under one roof—fused together by data-driven insights. Bright Mountain Media’s brands include Big Village Insights, Big Village Agency, Wild Sky Media, and BrightStream. For more Information, please visit www.brightmountainmedia.com.
Forward-Looking Statements for Bright Mountain Media, Inc.
This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties. Such forward-looking statements can be identified by the use of words such as “should,” “may,” “intends,” “anticipates,” “believes,” “estimates,” “projects,” “forecasts,” “expects,” “plans,” and “proposes,” and similar words. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including, without limitation, statements made with respect to expectations of our ability to successfully integrate acquisitions, and the realization of any expected benefits from such acquisitions. You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading “Risk Factors” in Bright Mountain Media, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2022 and our other filings with the SEC. Bright Mountain Media, Inc. does not undertake any duty to update any forward-looking statements except as may be required by law.
Contact:
Brian M. Prenoveau, CFA
MZ North America
561-489-5315
BMTM@mzgroup.us
BRIGHT MOUNTAIN MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except share and per share figures)
| Three Months Ended | ||||
|---|---|---|---|---|
| March 31, 2023 | March 31, 2022 | |||
| Revenue | $ | 1,498 | $ | 3,460 |
| Cost of revenue | 970 | 1,728 | ||
| Gross margin | 528 | 1,732 | ||
| General and administrative expenses | 3,428 | 3,851 | ||
| Loss from operations | (2,900) | (2,119) | ||
| Financing income (expense) | ||||
| Gain on forgiveness of PPP loan | — | 842 | ||
| Other income (expense) | 278 | — | ||
| Interest expense - Centre Lane Senior Secured Credit Facility- related party | (1,163) | (835) | ||
| Interest expense - Convertible Promissory Notes - related party | (5) | (5) | ||
| Other interest (expense) income | (6) | — | ||
| Total financing income (expense) | (896) | 2 | ||
| Net loss before income tax | (3,796) | (2,117) | ||
| Income tax provision (benefit) | — | — | ||
| Net loss | $ | (3,796) | $ | (2,117) |
| Dividends | ||||
| Preferred stock dividends | — | (1) | ||
| Net loss attributable to common shareholders | $ | (3,796) | $ | (2,118) |
| Foreign currency translation | 14 | — | ||
| Comprehensive loss | $ | (3,782) | $ | (2,118) |
| Net loss per commons share | ||||
| Basic and diluted | $ | (0.03) | $ | (0.01) |
| Weighted-average common shares outstanding | ||||
| Basic and diluted | 149,708,905 | 149,101,377 |
BRIGHT MOUNTAIN MEDIA, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share figures)
| December 31,<br>2022* | |||
|---|---|---|---|
| ASSETS | |||
| Current Assets | |||
| Cash and cash equivalents | 784 | $ | 316 |
| Accounts receivable, net | 3,585 | ||
| Prepaid expenses and other current assets | 600 | ||
| Total Current Assets | 4,501 | ||
| Property and equipment, net | 40 | ||
| Intangible assets, net | 4,510 | ||
| Goodwill | 19,645 | ||
| Operating lease right-of-use asset | 367 | ||
| Other assets | 137 | ||
| Total Assets | 26,802 | $ | 29,200 |
| LIABILITIES AND SHAREHOLDERS' (DEFICIT) | |||
| Current Liabilities | |||
| Accounts payable and accrued expenses | 8,835 | $ | 10,317 |
| Other liabilities | 1,838 | ||
| Interest Payable - 10% Convertible Promissory Notes - related party | 31 | ||
| Interest payable - Centre Lane Senior Secured Credit Facility - related party | — | ||
| Deferred revenue | 737 | ||
| Note payable – 10% Convertible Promissory Notes, net of discount - related party | 68 | ||
| Note payable - Centre Lane Senior Secured Credit Facility - related party (current portion) | 4,860 | ||
| Total Current Liabilities | 17,851 | ||
| Note payable – Centre Lane Senior Secured Credit Facility – net of discount, related party | 25,101 | ||
| Operating lease liability | 319 | ||
| Total Liabilities | 43,271 | ||
| Shareholders' Deficit | |||
| Convertible preferred stock, par value 0.01, 20,000,000 shares authorized: | |||
| Series A-1, 2,000,000 shares designated, no shares issued or outstanding at March 31, 2023 and December 31, 2022 | — | ||
| Series B-1, 6,000,000 shares designated, no shares issued or outstanding at March 31, 2023 and December 31, 2022 | — | ||
| Series E, 2,500,000 shares designated, no shares issued and outstanding at March 31, 2023 and December 31, 2022; liquidation preference of 0.40 per share | — | ||
| Series F, 4,344,017 shares designated, no shares issued or outstanding at March 31, 2023 and December 31, 2022 | — | ||
| Common stock, par value 0.01, 324,000,000 shares authorized, 150,634,636 and 150,444,636 issued and 149,809,461 and 149,619,461 outstanding at March 31, 2023 and December 31, 2022, respectively | 1,504 | ||
| Treasury stock, at cost; 825,175 shares at March 31, 2023 and December 31, 2022 | (220) | ||
| Additional paid-in capital | 98,797 | ||
| Accumulated deficit | (114,269) | ||
| Accumulated other comprehensive income | 117 | ||
| Total shareholder's deficit | (14,071) | ||
| Total liabilities and shareholders' deficit | 26,802 | $ | 29,200 |
All values are in US Dollars.
*Derived from audited consolidated financial statements.
BRIGHT MOUNTAIN MEDIA, INC.
RECONCILIATION OF NET LOSS TO NON-GAAP EBITDA AND ADJUSTED EBITDA
(in thousands)
Non-GAAP Financial Measure
Non-GAAP results are presented only as a supplement to the financial statements and for use within management's discussion and analysis based on U.S. generally accepted accounting principles (“GAAP”). The non-GAAP financial information is provided to enhance the reader's understanding of the Company's financial performance, but non-GAAP measures should not be considered in isolation or as a substitute for financial measures calculated in accordance with GAAP.
All of the items included in the reconciliation from net loss to EBITDA and from EBITDA to Adjusted EBITDA are either (i) non-cash items (e.g., depreciation, amortization of purchased intangibles, stock-based compensation, etc.) or (ii) items that management does not consider to be useful in assessing the Company's ongoing operating performance (e.g., M&A costs, income taxes, gain on sale of investments, loss on disposal of assets, etc.). In the case of the non-cash items, management believes that investors can better assess the Company's operating performance if the measures are presented without such items because, unlike cash expenses, these adjustments do not affect the Company's ability to generate free cash flow or invest in its business.
We use, and we believe investors benefit from the presentation of, EBITDA and Adjusted EBITDA in evaluating our operating performance because it provides us and our investors with an additional tool to compare our operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core operations. We believe that EBITDA is useful to investors and other external users of our financial statements in evaluating our operating performance because EBITDA is widely used by investors to measure a company's operating performance without regard to items such as interest expense, taxes, and depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired.
Because not all companies use identical calculations, the Company's presentation of non-GAAP financial measures may not be comparable to other similarly titled measures of other companies. However, these measures can still be useful in evaluating the Company's performance against its peer companies because management believes the measures provide users with valuable insight into key components of GAAP financial disclosures.
A reconciliation of net loss to EBITDA and Adjusted EBITDA is as follows:
| Three Months Ended March 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Net loss before tax plus: | $ | (3,796) | $ | (2,117) |
| Depreciation expense | 7 | 3 | ||
| Amortization of intangibles | 386 | 396 | ||
| Amortization of debt discount | 305 | 280 | ||
| Other interest expense | 6 | — | ||
| Interest expense - Centre Lane Senior Secured Credit Facility and Convertible Promissory Notes - related party | 864 | 559 | ||
| EBITDA | (2,228) | (879) | ||
| Stock compensation expense | 25 | 146 | ||
| Gain on forgiveness of PPP loan | — | (842) | ||
| Non-restructuring severance expense | 122 | — | ||
| Adjusted EBITDA | $ | (2,081) | $ | (1,575) |
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