LAS VEGAS, July 16, 2020 (GLOBE NEWSWIRE) -- Tix Corporation (the “Company”) (OTCQX: TIXC), a leading provider of discount ticketing services, today reported results for the second quarter and first six months ended June 30, 2020. The Company also reported recent director changes, and litigation.
The Current Las Vegas Marketplace:
Our Tix4Tonight business is located in Las Vegas where we sell shows, attractions, tours, and dining from our nine ticket booths that are strategically located on the Strip. As previously announced, due to efforts to mitigate the impact of COVID-19, virtually all Las Vegas entertainment, restaurants, bars, and major hotel properties temporarily closed on our about the week of March 16, 2020. While hotel properties have recently reopened, shows, attractions, tours, and most dining have remained closed. With the closure of entertainment on the Las Vegas Strip, and therefore the cessation of revenue for our business, we effected a layoff of the majority of our employees, closed our ticket booths, and continue to significantly reduce our operating costs. The Company’s second quarter and first six months of 2020 financial results were significantly impacted by the closure of entertainment on the Las Vegas Strip due to COVID-19.
We will continually monitor the Las Vegas marketplace to determine when and if we will be able to commence operations again. We intend to issue updated press releases as the COVID-19 situation, and its impact on entertainment and dining becomes clear. We plan to seek additional available disaster assistance, as well as other forms of financing to help with liquidity during this disruption to our business.
Financial Summary Results:
With the closure of entertainment on the Las Vegas Strip due to COVID-19, and therefore the cessation of revenue for our business, the Company’s generated no revenues in the second quarter of 2020, and first six months 2020 revenues decreased to $1,957,000, or 70%, as compared to $6,567,000 in the first six months of 2019. Our second quarter 2020 net loss was $1,318,000, as compared to a $13,000 net loss in the second quarter 2019. Our first six months 2020 net loss was $2,245,000, as compared to a $37,000 net income in the first six months of 2019.
Beginning in April 2020, and due to the impact on our business related to COVID-19, the Company has not made the majority of its lease payments, and is in default on the majority of its operating leases. As of June 30, 2020, the total amount of past due lease payments was approximately $639,000. The Company is in discussions with its landlords to restructure its leases.
On April 10, 2020, the Company obtained a Paycheck Protection Program loan in the amount of $980,000 pursuant to the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), and on June 23, 2020, the Company obtained an Economic Injury Disaster Loan in the amount of $150,000 pursuant to the Small Business Administration (SBA) authorized (under Section 7(b)) of the Small Business Act, as amended.
Director Changes
Effective June 5, 2020 and June 30, 2020, Michael Fisk and Jeremy Weiners resigned as members of the Board of Directors of the Company (the “Board”), respectively. On July 5, 2020, Gopal Patel was appointed by the Board to fill one of the resulting vacancies and will serve as a member of the Board.
Mr. Patel has been practicing law for 15 years and is currently a Partner at the law firm of Prindle, Goetz, Barnes and Reinholtz, LLP. Mr. Patel's primary area of practice is civil litigation and he has been retained to represent various industries from major retail developers, the hospitality industry, retail stores, fitness facilities to general contractors, medical and legal professionals and trucking companies. In additional to his civil litigation practice, Mr. Patel serves as general counsel for several privately owned companies.
Litigation
On June 19, 2020, the Company (“Tix”) filed suit in the Court of Chancery of the State of Delaware (“Court”) against HSB Capital Partners, L.P. (“HSB”). This dispute concerns actions taken by HSB in violation of its contractual obligations under that certain Agreement, dated as of October 4, 2019, between Tix, HSB and its namesake principal, Haren S. Bhakta, a director of Tix. Tix seeks Declaratory Relief for Material Breach of the Agreement, by requesting the Court declare that because HSB materially breached the Agreement, the HSB Nominees’ resignations shall become effective at such time as the order becomes non-appealable; and granting the Company such other and further relief as the Court deems just and proper.
About Tix Corporation
Tix Corporation (OTCQX:TIXC) provides discount ticketing services. It currently operates nine discount ticket stores in Las Vegas under its Tix4Tonight marquee and its online ticket sales site, www.tix4tonight.com, which offer up to a 50 percent discount for shows, concerts, attractions, and tours, as well as discount dining and shopping offers.
Safe Harbor Statement
Except for the historical information contained herein, certain matters discussed in this press release are forward-looking statements which involve risks and uncertainties. Forward-looking statements include, but are not limited to, statements about our future revenues and financial position. These forward-looking statements are based on expectations and assumptions as of the date of this press release and are subject to numerous risks and uncertainties which could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are discussed in the Company's filings with the OTC Markets. The Company assumes no obligation to update these forward-looking statements. A copy of the Company’s reports for the twelve months ended December 31, 2019, can be found on the Company website at www.tixcorp.com or www.otcmarkets.com.
Investor Contact:
Steve Handy, CFO, (818)761-1002
TIX CORPORATION AND SUBSIDIARY | ||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
| June 30, 2020 | December 31, 2019 | |||||||||
| (Unaudited) | ||||||||||
| Assets | ||||||||||
| Current assets: | ||||||||||
| Cash | $ | 1,568,000 | $ | 2,251,000 | ||||||
| Prepaid expenses and other current assets | 150,000 | 212,000 | ||||||||
| Total current assets | 1,718,000 | 2,463,000 | ||||||||
| Property and equipment, net | 94,000 | 123,000 | ||||||||
| Right of use asset, net | 2,248,000 | 3,086,000 | ||||||||
| Other assets: | ||||||||||
| Deposits and other assets | 305,000 | 487,000 | ||||||||
| Total other assets | 305,000 | 487,000 | ||||||||
| Total assets | $ | 4,365,000 | $ | 6,159,000 | ||||||
| Liabilities and Stockholders’ Equity | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable – shows and events | $ | - | $ | 267,000 | ||||||
| Accounts payable and accrued expenses | 538,000 | 487,000 | ||||||||
| Leases payable, current portion | 1,782,000 | 1,601,000 | ||||||||
| Loans payable, current portion | 220,000 | - | ||||||||
| Deferred revenue | 6,000 | 42,000 | ||||||||
| Total current liabilities | 2,546,000 | 2,397,000 | ||||||||
| Leases payable | 913,000 | 1,550,000 | ||||||||
| Loans payable | 910,000 | - | ||||||||
| Total liabilities | 4,369,000 | 3,947,000 | ||||||||
| Commitments and contingencies | ||||||||||
| Stockholders’ equity (deficit): | ||||||||||
| Preferred stock, $.01 par value; 500,000 shares authorized; none issued | ||||||||||
| Common stock, $.08 par value; 100,000,000 shares authorized; 17,337,175 shares net of 16,649,814 treasury shares issued and outstanding at June 30, 2020, and 17,342,175 shares net of 16,644,814 treasury shares issued and outstanding at December 31, 2019. | 2,720,000 | 2,720,000 | ||||||||
| Additional paid-in capital | 95,231,000 | 95,199,000 | ||||||||
| Treasury stock at cost | (28,167,000 | ) | (28,164,000 | ) | ||||||
| Accumulated deficit | (69,788,000 | ) | (67,543,000 | ) | ||||||
| Total stockholders’ equity (deficit) | (4,000 | ) | 2,212,000 | |||||||
| Total liabilities and stockholders’ equity | $ | 4,365,000 | $ | 6,159,000 | ||||||
| TIX CORPORATION AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||
| Revenues | $ | - | $ | 3,422,000 | $ | 1,957,000 | $ | 6,567,000 | ||||||||||
| Operating expenses: | ||||||||||||||||||
| Direct costs of revenues | 867,000 | 2,101,000 | 2,609,000 | 4,064,000 | ||||||||||||||
| Selling, general and administrative expenses | 435,000 | 1,354,000 | 1,478,000 | 2,408,000 | ||||||||||||||
| Depreciation expense | 14,000 | 30,000 | 29,000 | 61,000 | ||||||||||||||
| Total operating expenses | 1,316,000 | 3,485,000 | 4,116,000 | 6,533,000 | ||||||||||||||
| Operating income (loss) | (1,316,000 | ) | (63,000 | ) | (2,159,000 | ) | 34,000 | |||||||||||
| Loss on equity investment | - | - | (84,000 | ) | - | |||||||||||||
| Other income (expense) | (2,000 | ) | 50,000 | (2,000 | ) | 4,000 | ||||||||||||
| Income (loss) before income taxes | (1,318,000 | ) | (13,000 | ) | (2,245,000 | ) | 38,000 | |||||||||||
| Income tax expense | - | - | - | (1,000 | ) | |||||||||||||
| Net income (loss) | $ | (1,318,000 | ) | $ | (13,000 | ) | $ | (2,245,000 | ) | $ | 37,000 | |||||||
| Net income (loss) per common share – basic and diluted | $ | (0.08 | ) | $ | (0.00 | ) | $ | (0.13 | ) | $ | 0.00 | |||||||
| Weighted average common shares outstanding – basic and diluted | 17,337,175 | 17,342,175 | 17,337,560 | 17,342,175 | ||||||||||||||