UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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): November 14, 2019

______________

Dolphin Entertainment, Inc.

(Exact Name of Registrant as Specified in its Charter)

______________


Florida

001-38331

86-0787790

(State or Other Jurisdiction

(Commission

(IRS Employer

of Incorporation)

File Number)

Identification No.)


150 Alhambra Circle, Suite 1200

Coral Gables, Florida 33134

(Address of Principal Executive Offices) (Zip Code)


(305) 774-0407

(Registrant’s Telephone Number, Including Area Code)


Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

______________


Securities registered pursuant to Section 12(b) of the Act:  


Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.015 par value per share

DLPN

The Nasdaq Capital Market

Warrants to purchase Common Stock,
$0.015 par value per share

DLPNW

The Nasdaq Capital Market


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))


Indicate by check mark whether the registrant is an emerging growth company as defined 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 check mark 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 Condition.


The information contained in Item 7.01 of this Current Report on Form 8-K is incorporated by reference in this Item 2.02.


Item 7.01

Regulation FD Disclosure.

On November 14, 2019, Dolphin Entertainment, Inc., a Florida corporation (the “Company”), issued a press release announcing its financial results for the three and nine months ended September 30, 2019.  A copy of the Company’s earnings press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference in this Item 7.01. The information contained in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933, as amended.


Item 9.01

Financial Statements and Exhibits.


(d) Exhibits


Exhibit Number

 

Description

99.1

 

Press Release dated November 14, 2019







 


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.


 

DOLPHIN ENTERTAINMENT, INC.

 

 

 

 

 

Date:  November 14, 2019

By:  

/s/ Mirta A. Negrini

 

 

Name:

Mirta A. Negrini

 

         

Title:

Chief Financial and Operating Officer

 


















Press Release

 


EXHIBIT 99.1


Dolphin Entertainment Reports Third Quarter Financial Results

MIAMI, FL / ACCESSWIRE / November 14, 2019 / Dolphin Entertainment, Inc. (NASDAQ:DLPN), a leading independent entertainment marketing and premium content development company, announces its financial results for the period ended September 30, 2019.

Bill O'Dowd, CEO of Dolphin Entertainment, commented: “We are pleased to share that Dolphin exceeded consensus expectations in both revenue and earnings per share in the third quarter, which we attribute to the increased cross-selling of services between members of our Entertainment Marketing “Super Group.”  Our investments in these companies have led to our double-digit revenue growth through the first nine months of 2019, and we anticipate positive net income on a going-forward basis.  Also, we took important steps on the M&A front, and we expect that we will have our fourth acquisition finished shortly, and that we are on target to complete the acquisition of all 6 “core competency” members of our Entertainment Marketing “Super Group” on schedule within 2020, which we believe will increase our cross-selling opportunities and accelerate growth of both revenues and profits.”

Highlights

·

Total quarterly revenue increased 4% year-over-year to $5,948,056 and nine-month revenue increased 11% to $18,550,936.

·

Entertainment Publicity and Marketing revenue increased 13% year over year to $18,464,330 for the nine months ended September 30, 2019.

·

Operating loss for the three months ended September 30, 2019 of $(1,412,171), which included impairments to deferred production costs of Max Steel under the caption “direct costs” of $629,585 and non-cash items from depreciation and amortization of $485,965, compared to operating losses of $(538,840), which included non-cash items from depreciation and amortization of $599,078, for the same period in the prior year.

·

Net loss before income taxes for the three months ended September 30, 2019 of $(350,831), compared to net loss before income taxes of $(639,306) for the same period in the prior year. The Company does not have an income tax expense or benefit in the current quarter but had an income tax benefit of $819,451 for the three months ended September 30, 2018.

·

42West and The Door were selected to lead marketing efforts for the 45th annual Saturn Awards.


 


·

Veteran PR Professional Jodie Magid Oriol joined 42west As Vice President - New York Entertainment Marketing Division

·

The Door expanded its national footprint with the launch of Miami office

·

Closed a $2.1 Million offering of common stock at market, with no warrants issued

Conference Call Information

To participate in this event, dial approximately 5 to 10 minutes before the beginning of the call.
Date, Time: Thursday, November 14, 2019, at 4:30 p.m. ET
Toll-free: 844-369-8770
International: 862-298-0840
Live Webcast: https://www.investornetwork.com/event/presentation/56833

Conference Call Replay Information

The replay will be available beginning approximately 1 hour after the completion of the live event.
Toll-free: 1-877-481-4010
Reference ID: 56833

About Dolphin Entertainment, Inc.

Dolphin Entertainment, Inc. is a leading independent entertainment marketing and premium content development company. Through our subsidiaries 42West and The Door, we provide expert strategic marketing and publicity services to many of the top brands, both individual and corporate, in the entertainment and hospitality industries. The Door and 42West are both recognized global leaders in PR services for their respective industries and, in December 2017, the New York Observer listed them, respectively, as the third and fourth most powerful PR firms of any kind in the United States. Dolphin's recent acquisition of Viewpoint Creative adds full-service creative branding and production capabilities to our marketing group. Dolphin's legacy content production business, founded by Emmy-nominated CEO Bill O'Dowd, has produced multiple feature films and award-winning digital series.


 


Contact:

James Carbonara
Hayden IR
(646)-755-7412
james@haydenir.com

This press release contains 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, Dolphin Entertainment Inc.'s offering of common stock as well as expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by the use of words such as "will," "would," "anticipate," "expect," "believe," "designed," "plan," or "intend," the negative of these terms, and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, Dolphin Entertainment's actual results may differ materially from the results discussed in its forward-looking statements. Dolphin Entertainment's forward-looking statements contained herein speak only as of the date of this press release. Factors or events Dolphin Entertainment cannot predict, including those described in the risk factors contained in its filings with the Securities and Exchange Commission, may cause its actual results to differ from those expressed in forward-looking statements. Although Dolphin Entertainment believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved, and Dolphin Entertainment undertakes no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law.

SOURCE: Dolphin Entertainment, Inc.



 


DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)


 

 

As of
September 30,
2019

 

 

As of
December 31,
2018

 

ASSETS

  

                      

  

  

                      

  

Current

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,550,799

 

 

$

5,542,272

 

Restricted cash

 

 

714,016

 

 

 

732,368

 

Accounts receivable, net of allowance for doubtful accounts of $311,649 and $283,022, respectively.

 

 

3,023,870

 

 

 

3,173,107

 

Other current assets

 

 

576,799

 

 

 

620,970

 

Total current assets

 

 

5,865,484

 

 

 

10,068,717

 

 

 

 

 

 

 

 

 

 

Capitalized production costs, net

 

 

224,024

 

 

 

724,585

 

Intangible assets, net of accumulated amortization of $3,884,448 and $2,714,785, respectively.

 

 

7,696,885

 

 

 

9,395,215

 

Goodwill

 

 

15,996,977

 

 

 

15,922,601

 

Right-of-use asset

 

 

6,139,776

 

 

 

—

 

Property, equipment and leasehold improvements, net

 

 

962,085

 

 

 

1,182,520

 

Investments

 

 

220,000

 

 

 

220,000

 

Deposits and other assets

 

 

502,399

 

 

 

475,956

 

Total Assets

 

$

37,607,630

 

 

$

37,989,594

 

 

 

 

 

 

 

 

LIABILITIES

  

                      

  

  

                      

  

Current

 

 

 

 

 

 

 

 

Accounts payable

 

$

769,608

 

 

$

944,232

 

Other current liabilities

 

 

4,427,469

 

 

 

6,296,594

 

Line of credit

 

 

1,700,390

 

 

 

1,700,390

 

Put rights

 

 

2,912,246

 

 

 

4,281,595

 

Accrued compensation

 

 

2,637,500

 

 

 

2,625,000

 

Debt

 

 

3,311,199

 

 

 

3,353,741

 

Loan from related party

 

 

1,107,873

 

 

 

1,107,873

 

Contract liabilities

 

 

311,484

 

 

 

522,620

 

Lease liability

 

 

1,404,938

 

 

 

—

 

Convertible notes payable, net of debt discount

 

 

2,721,731

 

 

 

625,000

 

Notes payable

 

 

286,068

 

 

 

479,874

 

Total current liabilities

 

 

21,590,506

 

 

 

21,936,919

 

Noncurrent

 

 

 

 

 

 

 

 

Put rights

 

 

365,646

 

 

 

1,702,472

 

Convertible notes payable

 

 

1,477,597

 

 

 

1,376,924

 

Notes payable

 

 

747,012

 

 

 

612,359

 

Contingent consideration

 

 

440,000

 

 

 

550,000

 

Lease liability

 

 

5,269,239

 

 

 

—

 

Other noncurrent liabilities

 

 

—

 

 

 

1,034,393

 

Total noncurrent liabilities

 

 

8,299,494

 

 

 

5,276,148

 

Total Liabilities

 

 

29,890,000

 

 

 

27,213,067

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies (Note 19)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Common stock, $0.015 par value, 200,000,000 shares authorized, 14,641,466 and 14,123,157, respectively, issued and outstanding at September 30, 2019 and December 31, 2018

 

 

219,624

 

 

 

211,849

 

Preferred Stock, Series C, $0.001 par value, 50,000 shares authorized, issued and outstanding at September 30, 2019 and December 31, 2018

 

 

1,000

 

 

 

1,000

 

Additional paid in capital

 

 

103,146,270

 

 

 

105,092,852

 

Accumulated deficit

 

 

(95,649,264

)

 

 

(94,529,174

)

Total Stockholders' Equity

 

 

7,717,630

 

 

 

10,776,527

 

Total Liabilities and Stockholders' Equity

 

$

37,607,630

 

 

$

37,989,594

 




 


DOLPHIN ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)


 

 

For the three months ended

 

 

For the nine months ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Revenues:

  

                      

  

  

                      

  

  

                      

  

  

                      

  

Entertainment publicity and marketing

 

$

5,940,440

 

 

$

5,720,264

 

 

$

18,464,330

 

 

$

16,297,466

 

Content production

 

 

7,616

 

 

 

—

 

 

 

86,606

 

 

 

427,153

 

Total revenues

 

 

5,948,056

 

 

 

5,720,264

 

 

 

18,550,936

 

 

 

16,724,619

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct costs

 

 

1,540,711

 

 

 

333,041

 

 

 

4,006,806

 

 

 

1,199,165

 

Selling, general and administrative

 

 

1,023,757

 

 

 

1,111,516

 

 

 

2,875,348

 

 

 

2,547,621

 

Depreciation and amortization

 

 

485,965

 

 

 

599,078

 

 

 

1,446,168

 

 

 

1,345,421

 

Legal and professional

 

 

353,699

 

 

 

601,330

 

 

 

1,158,497

 

 

 

1,445,818

 

Payroll

 

 

3,956,095

 

 

 

3,614,139

 

 

 

12,503,528

 

 

 

10,755,111

 

Total expenses

 

 

7,360,227

 

 

 

6,259,104

 

 

 

21,990,347

 

 

 

17,293,136

 

Loss before other income (expenses)

 

 

(1,412,171

)

 

 

(538,840

)

 

 

(3,439,411

)

 

 

(568,517

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (loss) on extinguishment of debt, net

 

 

709,097

 

 

 

—

 

 

 

687,811

 

 

 

(53,271

)

Acquisition costs

 

 

—

 

 

 

(182,504

)

 

 

—

 

 

 

(217,174

)

Change in fair value of put rights

 

 

627,799

 

 

 

(110,840

)

 

 

2,406,175

 

 

 

1,305,797

 

Change in fair value of contingent consideration

 

 

20,000

 

 

 

470,000

 

 

 

110,000

 

 

 

470,000

 

Interest expense and debt amortization expense

 

 

(295,556

)

 

 

(277,122

)

 

 

(884,665

)

 

 

(810,521

)

Total other income (expenses)

 

 

1,061,340

 

 

 

(100,466

)

 

 

2,319,321

 

 

 

694,831

 

(Loss) income before income taxes

 

$

(350,831

)

 

$

(639,306

)

 

$

(1,120,090

)

 

$

126,314

 

Income taxes

 

 

—

 

 

 

819,451

 

 

 

—

 

 

 

538,831

 

Net (loss) income

 

$

(350,831

)

 

$

180,145

 

 

$

(1,120,090

)

 

$

665,145

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income per Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.02

)

 

$

0.01

 

 

$

(0.07

)

 

$

0.05

 

Diluted

 

$

(0.05

)

 

$

0.01

 

 

$

(0.17

)

 

$

(0.04

)

Weighted average number of shares used in per share calculation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

16,071,891

 

 

 

14,565,766

 

 

 

15,995,774

 

 

 

13,151,649

 

Diluted

 

 

19,847,935

 

 

 

14,565,766

 

 

 

20,225,129

 

 

 

15,255,445