Vinco Ventures, Inc. Reports Financial Results for the Three Months Ended March 31, 2021

Bethlehem, P.A., May 25, 2021 (GLOBE NEWSWIRE) -- Vinco Ventures, Inc. (NASDAQ:BBIG), a digital media merger and acquisitions company, today announced results for the three months ended March 31, 2021.

Company Highlights

  Revenue increased 31.32% for the three months ended March 31, 2021 versus the three months ended March 31, 2020.
     
  Company enters into Agreement to Complete a Plan of Merger with ZASH Global Media and Entertainment Corporation
     
  Company enters into joint venture with ZASH Global Media and Entertainment Corporation forming ZVV Media Partners, LLC

Three Months End March 31, 2021 Financial Summary

Revenue

  Revenue for the three months ended March 31, 2021 increased to $2.57 million as compared to $1.95 million for the three months ended March 31, 2020, a 31.32% increase.
     
  Gross Profit for the three months ended March 31, 2021 increased to $0.9 million as compared to $0.6 million for the three months ended March 31, 2020, a 56.64% decrease.
     
  Gross Margin for the three months ended March 31, 2021 increased to 35.54% as compared to 30.19% for the three months ended March 31, 2020, a 17.72% increase.

Net Loss

  Net loss for the three months ended March 31, 2021 was $62.47 million, or ($3.27) per basic and ($3.28) per diluted share, compared to a net gain of $1.27 million, or $0.166 per basic and $0.13 per diluted share for the three months ended March 31, 2020.

Adjusted EBITDA

  Adjusted EBITDA, a non-GAAP measure, totaled a negative $1.29 million for the three months ended March 31, 2021, compared to a negative $0.92 million for the three months ended March 31, 2020. 
     
  Adjusted EBITDA includes the addback for the loss on issuance of warrant liability of $75.2 million offset by a gain on change in fair value of warrant liability of $36.4 million.

See below, under the heading “Use of Non-GAAP Financial Information,” for a discussion of Adjusted EBITDA and a reconciliation of such measure to the most comparable measure calculated under U.S. generally accepted accounting principles (“GAAP”).

For the three months ended March 31, 2021 and 2020, EBITDA and Adjusted EBITDA consisted of the following:

    For the Three Months
Ended March 31,
 
    2021     2020  
Net income (loss) from continuing operations   $ (62,263,320 )   $ 1,269,492  
Net income (loss) from discontinued operations     (178,200 )     -  
Interest expense, net     12,694,933       723,957  
Depreciation and amortization     445,541       316,298  
EBITDA     (49,301,046 )     2,309,747  
Stock-based compensation     8,697,502       1,319,511  
Loss on issuance of warrant liability     75,156,534          
Change in fair value of warrant liability     (36,381,542 )     -  
Restructuring and severance costs     -       242,136  
Transaction and acquisition costs     704,565       82,736  
Other non-recurring costs     -       40,860  
Gain on divestiture     -       (4,911,760 )
      -       -  
Adjusted EBITDA   $ (1,123,987 )   $ (916,770 )


Vinco
Ventures, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS

    March 31,
2021
    December 31,
2020
 
    (Unaudited)        
Assets                
Current assets:                
Cash and cash equivalents   $ 5,525,744     $ 249,356  
Accounts receivable, net     1,683,294       1,382,163  
Short-term investments     948,000       1,018,000  
Inventory     1,123,261       1,127,725  
Prepaid expenses and other current assets     603,966       522,259  
Current assets of discontinued operations     1,354,546       1,042,680  
Total current assets     11,238,811       5,342,183  
Property and equipment, net     996,217       1,010,801  
Right of use assets, net     128,871       153,034  
Loan receivable     5,000,000       -  
Equity method investment     7,000,000       -  
Intangible assets, net     9,485,370       9,798,813  
Goodwill     5,983,852       5,983,852  
Non-current assets of discontinued operations     5,640,238       5,739,524  
Total assets   $ 45,473,359     $ 28,028,207  
                 
Liabilities and stockholders’ equity                
Current liabilities:                
Accounts payable   $ 1,339,009     $ 3,618,339  
Accrued expenses and other current liabilities     1,344,750       2,101,610  
Deferred revenues     131,578       152,040  
Current portion of operating leases liabilities     73,054       96,777  
Income tax payable     27,643       27,643  
Line of credit, net of debt issuance costs of $0 and $15,573, respectively     1,133,652       1,500,953  
Current portion of convertible notes payable, net of debt issuance costs of $9,827,778 and $0, respectively     1,172,222       577,260  
Current portion of notes payable, net of debt issuance costs of $0 and $212,848, respectively     441,192       1,301,212  
Current portion of notes payable – related parties     876,500       1,389.923  
Due to related party     15,450       32,452  
Current liabilities of discontinued operations     589,363       487,454  
Total current liabilities     7,144,413       11,285,663  
Operating leases liabilities –net of current portion     58,713       58,713  
Convertible notes payable – related parties, net of current portion, net of debt discount of $172,984 and $366,666, respectively     249,288       1,161,495  
Notes payable, net of current portion     450,002       595,879  
Notes payable – related parties, net of current portion     1,291,013       1,403,756  
Warrant liability     58,235,565       -  
Total liabilities   $ 67,428,994     $ 14,505,506  
Commitments and Contingencies (Note 12)                
                 
Stockholders’ equity                
Preferred stock, $0.001 par value, 30,000,000 shares authorized as of March 31, 2021 and December 31, 2020, respectively     -       -  
Series B Preferred Stock, $0.001 par value, 1,000,000 shares authorized; 764,618 and 764,618 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively   $ 765     $ 765  
Common stock, $0.001 par value, 250,000,000 shares authorized 25,685,981 and 14,471,403 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively     25,686       14,471  
Additional paid-in-capital     66,002,229       39,050,260  
Accumulated deficit     (86,118,452 )     (23,648,898 )
Total stockholders’ (deficit) equity attributable to Vinco Ventures, Inc.     (20,089,772     15,416,598  
Noncontrolling interests     (1,865,863 )     (1,893,897 )
Total stockholders’ equity     (21,955,635     13,522,701  
Total liabilities and stockholders’ equity   $ 45,473,359     $ 28,028,207  

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

    Three Months Ended
March 31,
 
    2021
(Unaudited)
    2020
(Unaudited)
 
             
Revenues, net   $ 2,565,162     $ 1,953,346    
Cost of revenues     1,653,381       1,363,719    
Gross profit     911,781       589,627    
                 
Operating expenses:                
Selling, general and administrative     11,660,880       3,288,949    
Operating loss     (10,749,099 )     (2,699,322 )  
                 
Other (expense) income:                
Rental income     25,704       25,704    
Interest expense     (12,694,933 )     (723,957   )
Loss on issuance of warrants     (75,156,534 )     -    
Change in fair value of warrant liability     36,381,542       -    
Change in fair value of short-term investment     (70,000 )     -    
Total other income (expense), net     (51,514,221 )     (698,253   )
(Loss) income before income taxes     (62,263,320 )     (3,397,575   )
Income tax expense     -       -    
Net loss from continuing operations   $ (62,263,320 )   $ (3,397,575   )
Net income attributable to noncontrolling interests     28,034       -    
Net loss attributable to Vinco Ventures, Inc. from continuing operations     (62,291,354 )     (3,397,575   )
Loss from discontinued operations     (178,200 )     (244,693   )
Gain on divestiture from discontinued operations     -       4,911,760    
Net (loss) income attributable to Vinco Ventures, Inc.     (62,469,554 )     1,269,492    
Net (loss) income per share - basic   $ (3.27 )   $ 0.16    
Net (loss) income per share - diluted   $ (3.28 )   $ 0.13    
Weighted average number of common shares outstanding – basic     19,055,006       8,181,470    
Weighted average number of common shares outstanding – diluted     19,055,006       9,637,421    

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

    Three Months Ended March 31,  
    2021
(Unaudited)
    2020
(Unaudited)
 
Cash Flow from Operating Activities                
Net income (loss) attributable to Vinco Ventures, Inc.   $ (62,291,354 )   $ (3,397,975 )
Net income attributable to noncontrolling interests     28,034       -  
Net income (loss)     (62,263,320 )     (3,397,975 )
Adjustments to reconcile net (income) loss to net cash used in operating activities:                
Discontinued operations     (178,200 )     4,667,067  
Depreciation and amortization     445,541       316,299  
Amortization of financing costs     12,418,930       570,636  
Stock-based compensation     8,697,502       1,319,511  
Amortization of right of use asset     24,163       77,823  
Gain on divestiture     -       (4,911,760 )
Change in fair value of short-term investments     70,000       -  
Loss on issuance of warrants     75,156,534          
Change in fair value of warrant liability     (36,381,542 )        
Changes in assets and liabilities:                
Accounts receivable     (494,130 )     64,359  
Inventory     (215,717 )     69,089  
Prepaid expenses and other current assets     139,635       33,441  
Accounts payable     (804,282 )     (215,320 )
Accrued expenses and other current liabilities     (714,500 )     335,815  
Operating lease liabilities     (23,723 )     (74,776 )
Due from related party     (17,001 )     (8,115 )
Net cash used in operating activities     (4,140,110 )     (1,153,506 )
                 
Cash Flows from Investing Activities                
Purchases of property and equipment     (18,228 )     (31,918 )
Equity method investment     (7,000,000 )     -  
Funding of loan receivable     (5,000,000 )     -  
Net cash used in investing activities     (12,018,228 )     (31,918 )
                 
Cash Flows from Financing Activities                
Net (repayments) borrowings under line of credit     (379,333 )     112,862  
Borrowings under convertible notes payable     19,720,000       1,100,000  
Borrowings under notes payable     73,000       950,000  
Repayments under notes payable     (2,141,782 )     (672,773 )
Repayments under notes payable- related parties     (659,999 )     (14,508 )
Fees paid for financing costs     (122,762 )     (170,815 )
Net proceeds from issuance of common stock     3,255,000       -  
Exercise of warrants     1,690,604       -  
Net cash provided by financing activities     21,434,726       1,304,766  
Net increase (decrease) in cash and cash equivalents     5,276,388       119,342  
Cash and cash equivalents - beginning of period     249,356       412,719  
Cash and cash equivalents - end of period   $ 5,525,744       532,062  
                 
Supplemental Disclosures of Cash Flow Information                
Cash paid during the period for:                
Interest   $ 343,824     $ 127,504  
Income taxes   $ (14,738   $ -  
Noncash investing and financing activity:                
Shares issued to note holders   $ 422,672     $ 368,000  
Conversions under notes payable   $ 11,094,020     $ -  
Issuance of warrants to note holders   $ 22,000,000     $ -  

About Vinco Ventures, Inc.

Vinco Ventures, Inc. (BBIG) is a selective acquisitions company focused on digital media and content technologies. Vinco’s B.I.G. Strategy (Buy. Innovate. Grow.) is to seek out acquisition opportunities that are poised for scale and will BE BIG. For more information visit Investors.vincoventures.com.

Use of Non-GAAP Financial Information

EBITDA and Adjusted EBITDA is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes that because Adjusted EBITDA excludes (i) certain non-cash expenses (such as depreciation, amortization and stock-based compensation) and (ii) expenses that are not reflective of the Company’s core operating results over time (such as restructuring costs, litigation or dispute settlement charges or gains, and transaction-related costs), this measure provides investors with additional useful information to measure the Company’s financial performance, particularly with respect to changes in performance from period to period. Edison Nation management uses EBITDA and Adjusted EBITDA (a) as a measure of operating performance; (b) for planning and forecasting in future periods; and (c) in communications with the Company’s Board of Directors concerning the Company’s financial performance. The Company’s presentation of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation and should not be used by investors as a substitute or alternative to net income or any measure of financial performance calculated and presented in accordance with U.S. GAAP. Instead, management believes EBITDA and Adjusted EBITDA should be used to supplement the Company’s financial measures derived in accordance with U.S. GAAP to provide a more complete understanding of the trends affecting the business.

Forward-Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding strategy, future operations and plans, including assumptions underlying such statements, are forward-looking statements, and should not be relied upon as representing the Company’s views as of any subsequent date. Such forward-looking statements are based on information available to the Company as of the date of this release and involve a number of risks and uncertainties, some beyond the Company’s control, that could cause actual results to differ materially from those anticipated by these forward-looking statements, including consumer, regulatory and other factors affecting demand for the Company’s products, any difficulty in marketing the Company’s products in global markets, competition in the market for consumer products and inability to raise capital to fund operations and service the Company’s debt. Additional information that could lead to material changes in the Company’s performance is contained in its filings with the SEC. The Company is under no obligation to, and expressly disclaims any responsibility to, update or alter forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.

Investor Relations:

Aimee Carroll
Phone (866) 900-0992
Email: Investors@vincoventures.com


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Source: Vinco Ventures, Inc.