Troika Media (TRKA) Announces Third Quarter Revenue of $15.7 Million and Net Loss of $14.4 Million
Enter Wall Street with StreetInsider Premium. Claim your one week free trial here.
Troika Media Group, Inc. (Nasdaq: TRKA) today announced financial results for the third quarter fiscal 2022 ended March 31, 2022. Management will host a conference call to discuss these results and other updates. day of the reorganization after the company soon files with the Securities and Exchange Commission (SEC) the audited financial results of Converge Direct, LLC (“Converge”) and its affiliates for the fiscal years ended December 31, 2021, 2020 and 2019.
Third Quarter and Current Year Financial and Operational Highlights
- Revenue increased 307% to $15.7 million in Q3 2022, compared to the prior year quarter.
- The acquisition of Converge, which closed on March 22, 2022, contributed $10.0 million to total third quarter 2022 revenue (a 10-day revenue period included in the company’s third quarter ).
- As of March 31, 2022, the Company had $42.4 million of free cash on its balance sheet and expects strong revenue growth to continue in fiscal 2022.
- New business demand across all solution groups continues to build momentum in Q4 2022, with a growing number of new customers and diversified industries.
“We are pleased with the 307% increase in revenue in the third quarter of 2022 compared to the prior year quarter. The performance is indicative of the continued recovery of core branding and activation business post Covid, and a very small example of the impact the acquisition of Converge is expected to have on the company’s revenue once we are able to include a full quarter of Converge’s performance,” said Sid Toama, who was appointed CEO of TMG on May 19, 2022. “Demand for Troika’s performance-driven solutions for brand building, activation and marketing innovations is increasing. Business intelligence and acquisition capabilities of Converge customers will be an exciting addition to TMG’s new integrated business strategy and ultimately its revenue opportunities.
Mr. Toama added, “TMG is at an important point in its transformation following the acquisition of Converge; we are optimizing the organizational structure and functions designed to provide a scalable and more profitable business model. The plan is to leverage the company’s historic acquisitions to create an integrated group of attractive and profitable performance-driven business solutions powered by globally integrated business functions The changes we have made and are continuing to make bring should save significant long-term costs and accelerate TMG’s unified business, while continuing to build on Converge’s proven operating and business model.
Summary results for the third quarter of fiscal 2022 (GAAP)
Revenue for the three months ended March 31, 2022 and 2021 were $15.7 million and $3.9 million, respectively, an increase of approximately $11.8 million or 307%. This increase is mainly attributable to the acquisition of Converge, which closed on March 22, 2022, and the recognition of revenue of approximately $10.0 million. The remaining balance of approximately $1.8 million of revenue is attributable to TMG’s integrated brand and engagement solutions, which benefited from the generation of new business from UK and US-based subsidiaries after the COVID.
Operating expenses for the three months ended March 31, 2022 and 2021 were $17.6 million and $7.5 million, respectively, an increase of $10.1 million or 134.1%. The $10.1 million increase in operating costs is primarily related to one-time charges related to stock incentive plans of $8.1 million and one-time expenses in the form of professional fees associated with the acquisition of Converge of $2.4 million.
Operating loss for the three months ended March 31, 2022 was $13.7 million, an increase of $8.1 million over the prior year period. The increase is mainly attributable to the increase in operating expenses of $10.1 million and the increase in cost of products of $9.8 million partially offset by the increase in revenue of $11.8 million. millions of dollars.
Summary results for the third quarter of fiscal 2022 (Non-GAAP)*
|Quarter ended March 31|
|Non-GAAP measures (unaudited):|
|Acquisition fees and related professional fees||2,658,000||–|
|Depreciation and amortization||429,000||574,000|
|Interest expense, net||100,000||–|
|Bad Debt Expenses||85,000||–|
|Stock-based compensation expense||9,901,000||2,698,000|
* Please refer to the “Non-GAAP Financial Measures” section below for a description of these measures.
Adjusted EBITDA is defined as net income (net loss), excluding interest income; interest charges; other net income (expenses); income tax benefit (expense); depreciation and amortization; stock-based compensation expense and other payroll tax expense; and certain other non-cash or non-recurring items affecting net income (loss) from time to time.
Note: For adjustments and additional information regarding non-GAAP financial measures and other items discussed, please see “Non-GAAP Financial Measures”, “Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures “.
About Troika Media Group
TMG is a transformational business solutions partner based in New York, Los Angeles and London. We deliver resilient brand equity, amplifying brands through emerging technologies and transcending them in culture to deliver performance-driven business growth. Troika’s expertise lies in the consumer products and services, entertainment and media, sports and sports betting, finance and professional, education and esports and gaming industries. Our clients include Apple, Hulu, Riot Games, Belvedere Vodka, Unilever, UFC, Leaf Home, AT&T, Andersen Windows, Peloton, CNN, HBO, ESPN, Wynn Resorts and Casinos, Tiffany & Co., IMAX, Netflix, Sony, Yahoo and Coca-Cola. For more information, visit www.thetmgrp.com.
Certain statements in this press release that are not historical facts are forward-looking statements that reflect management’s current expectations, assumptions and estimates regarding future performance and economic conditions, and involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. Forward-looking statements are generally identifiable by the use of forward-looking words such as “believes”, “expects”, “may”, “hopes”, “will”, “should”, “plans”, “has intent to”, “provided”, “target”, “see”, “potential”, “estimates”, “preliminary” or “anticipate” or the negative thereof or comparable terminology, or through a discussion of the strategy or objectives or other future events or circumstances, or effects. Additionally, forward-looking statements contained in this release include, but are not limited to, the impact of the current COVID-19 pandemic, which may limit access to facilities, customers, management, personnel of support and professional advisors to the Company, and to develop and provide advanced voice and data communications systems, demand for the Company’s products and services, economic conditions in the United States and around the world, including the effects of the war in Ukraine, and the Company’s ability to recruit and retain management, technical and sales personnel or fully integrate the Converge business. Further information regarding factors that could affect the Company’s results and forward-looking statements is disclosed in the Company’s filings with the SEC. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company disclaims any intention or obligation, other than required by law, to update or revise any forward-looking statement, whether either as a result of new information, future events or otherwise
Contact with Investor Relations:
Source: Troika Media Group