CDN NEWS | 
US NEWS 
FOR: WOW! UNLIMITED MEDIA INC.
TSX VENTURE Symbol: RNK.A
TSX VENTURE Symbol: RNK.B
Date issue: May 30, 2017
Time in: 4:58 PM e
Attention:
VANCOUVER, BC --(Marketwired - May 30, 2017) - Wow Unlimited Media Inc. (formerly Rainmaker Entertainment Inc.) ("Wow" or the "Company") (TSX VENTURE: RNK.A) (TSX VENTURE: RNK.B) has refiled its financial statements and management's discussion & analysis for the period ended March 31, 2017 to correct a clerical error with respect to the loss per share figures included therein. The Company is pleased to announce its results for the quarter ended March 31, 2017. The first quarter results incorporate a full quarter of the operations of Frederator Networks following the acquisition of Frederator Networks in December 2016.
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For the three months ended March 31, March 31, $000's, except per share amounts 2017 2016 ---------------------------------------------------------------------------- Revenue $ 5,867 $ 4,545 Operating EBITDA (795) 33 Operating loss (1,184) (555) ---------------------------------------------------------------------------- Net loss $ (1,184) $ (9,961) Net loss per share - basic and diluted $ (0.05) $ (5.68) ---------------------------------------------------------------------------- Weighted average number of shares outstanding - basic and diluted 25,581,577 1,754,018 ----------------------------------------------------------------------------/T/
(1) See section "Non-GAAP Financial Measures" in this earnings release. (2) All earnings per share data for comparative periods have been adjusted to reflect a 10:1 share consolidation completed during the year-ended December 31, 2016
FINANCIAL HIGLIGHTS
The Company reported the following highlights from three months ended March 31, 2017:
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-- First quarter revenue earned was $5.9 million. This included $1.6
million generated by Channel Frederator Network, which grew by an average of 155 million views a month during the first quarter of 2017./T/
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-- Work commenced on two new work-for-hire productions during the quarter,
which total approximately $24 million in contract revenue.
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Michael Hirsh, Chairman and CEO, commented: "Wow has started off with strong momentum in its first quarter as a combined company. The Company signed on several new projects with marquee clients such as Netflix, Amazon and Mattel, resulting in a current production pipeline of over $50 million. In addition, our digital network recorded substantial growth in monthly viewership of over 32% quarter over quarter."
OPERATIONAL UPDATE
Channel Frederator Network continues to grow, with 44 channels added to the network in April 2017, for a total of 270 channels added between January 2017 and April 2017. This brings the network channel partner count even closer to the 3,000 channel partner threshold. By April 30, 2017, Channel Frederator Network attracted a total of 2.4 billion views from January to April, with 695 million views in April alone, and by April 30, 2017 there were 43 million subscribers.
Animation productions continue to form a steady part of Wow's business. The two new productions added to the slate during the quarter strengthen the production services pipeline.
CHANGE OF TICKER SYMBOL
The Company is pleased to announce that the Company's Common Voting Shares and Variable Voting Shares will begin trading under the new stock ticker symbols "WOW.A" and "WOW.B", respectively, on the TSX Venture Exchange ("TSXV"), effective at the opening of trading on June 1, 2017. This change in the stock ticker symbols for the Common Voting Shares and Variable Voting Shares does not require any action by current shareholders as the Company's CUSIP numbers for these shares will remain unchanged.
CONSOLIDATED RESULTS FOR THE QUARTER
Selected financial information for the three months ended March 31, 2017 and 2016 is as follows:
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For the three months ended March 31, March 31, $000's 2017 2016 ---------------------------------------------------------------------------- Revenue $ 5,867 $ 4,545Operating EBITDA (795) 33 Net finance costs 88 494 Depreciation and amortization1 121 144 Share based payments 180 - Service credits - (50) ---------------------------------------------------------------------------- Operating loss (1,184) (555) ---------------------------------------------------------------------------- Items affecting comparability: Impairments - 567 Share of loss of Ratchet Productions, LLC - 8,839 ---------------------------------------------------------------------------- - 9,406 ---------------------------------------------------------------------------- Net loss $ (1,184) $ (9,961) ---------------------------------------------------------------------------- Items affecting comparability: Foreign operations - foreign currency transation differences 9 416 ---------------------------------------------------------------------------- Total comprehensive loss $ (1,193) $ (10,377) ----------------------------------------------------------------------------
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(1) Excludes amortization of investment in film and television properties
Revenue & Operating EBITDA
Revenue increased by 31% by $1.4 million, for total revenue earned of $5.9 million. The increase was driven by:
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-- The addition of revenue generated by Channel Frederator Network; -- The commencement of two new productions during the quarter; offset by -- Comparatively lower work-for-hire production levels, as the new
productions take time reach full production levels.
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The production of the Company's own IP, Reboot, was underway at Mainframe Studios utilizing capacity, the benefit of which is expected to be recognised as revenue in the second half of 2017.
The $0.8 million reduction in operating EBITDA compared to the first quarter of 2016 is largely result of an increase in general and administration expenses of the combined operations and higher operating expenses relative to revenue generated largely due to the timing of studio production schedules.
Net finance costs
The decrease in other expenses of $0.4 million is largely due to the decrease in interest expense on convertible debentures of $0.4 million quarter over quarter. The convertible debentures were settled as part of the Company's corporate reorganization and acquisitions that were completed in December 2016.
Depreciation and amortization
The reduced depreciation charge is as a result of amounts capitalized during the first three months of 2017 for assets used during the production of the one of the Company's owned IP, ReBoot.
Share based payments
Shared based payments for the three months ended March 31, 2017 was $0.2 million compared to $nil in the same period for 2016. On April 20, 2017 the Company's board of directors approved the issuance of incentive stock options to key members of management and personnel. Although the options were granted and issued subsequent to March 31, 2017, vesting began during the first quarter. Their issuance remains subject to TSXV approval.
Impairments and Share of loss in Ratchet Productions, LLC - Ratchet & Clank
During the Company's previous fiscal year, as previously disclosed, the Company impaired its investment in Ratchet Productions, LLC ("RPLLC") ($8.8 million) and an amount of $0.6 million owing to Wow by RPLLC which was not recoverable.
NON-GAAP FINANCIAL MEASURES
The Company reports using certain supplemental indicators of the Company's financial and operating performance in addition to results reported in accordance with International Financial Reporting Standards ("GAAP"). These measures are referred to as non-GAAP measures, and include operating earnings, operating earnings per share and operating EBITDA. The Company believes these supplemental financial measures reflect the Company's ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in its business.
The Company defines operating earnings as net profit or loss excluding the impact of specified items affecting comparability, including, where applicable, share of loss of equity accounted investees, other non-operational income and expenses, deferred taxes and other gains or losses. The use of the term "non-operational income and expenses" is defined by the Company as those that do not impact operating decisions taken by the Company's management and is based upon the way the Company's management evaluates the performance of the Company's business for use in the Company's internal management reports. Operating earnings per share is calculated using diluted weighted average shares outstanding and does not represent actual earnings per share attributable to shareholders. The Company believes that the disclosure of operating earnings and operating earnings per share allows investors to evaluate the operational and financial performance of the Company's ongoing business using the same evaluation measures that management uses, and is therefore a useful indicator of the Company's performance or expected performance of recurring operations.
The Company defines operating EBITDA as earnings before interest, taxes, depreciation and amortization (excluding amortization of investments in film and television properties), adjusted for certain items affecting comparability as specified in the calculation of operating earnings. The Company discloses operating EBITDA to capture the profitability of its business before the impact of items not considered in management's evaluation of operating performance. Unless otherwise stated, the Company includes the amortization of investments in film and television in the calculation of EBITDA.
Operating earnings, operating earnings per share and operating EBITDA do not have any standardized meaning prescribed by GAAP and therefore may not be comparable to similar measures presented by other companies. The Company cautions readers to consider these non-GAAP financial measures in addition to, and not as an alternative for, measures calculated in accordance with GAAP.
Forward-looking Statements
This news release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "could", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "may", "will", "project", "should" or similar words, including negatives thereof, suggesting future outcomes.
In particular, this news release contains forward-looking statements relating to, among other things: (i) general economic conditions; (ii) future revenues to be received by Wow; (iii) Wow's future business prospects and opportunities; and (iv) Wow's ability to complete any or all of its proposed production work.
Management of the Company believes the expectations reflected in such forward-looking statements are reasonable as of the date hereof but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Various material factors and assumptions are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Those material factors and assumptions are based on information currently available to the Company, including data from publicly available governmental sources as well as from market research and industry analysis and on assumptions based on data and knowledge of this industry which the Corporation believes to be reasonable. However, although generally indicative of relative market positions, market shares and performance characteristics, such data is inherently imprecise.
Forward-looking statements are not a guarantee of future performance and are subject to and involve a number of known and unknown risks and uncertainties, many of which are beyond the control of the Company, which may cause the Company's actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the risks identified in the Company's management's discussion & analysis dated April 25, 2017 and the Company's management information circular dated November 14, 2016 both of which have been filed with the Canadian Securities Administrators and available on www.sedar.com. Any forward-looking statements are made as of the date hereof and, except as required by law, the Company assumes no obligation to publicly update or revise such statements to reflect new information, subsequent or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
About Wow Unlimited Media Inc.
Wow Unlimited Media Inc., (formerly Rainmaker Entertainment Inc.), is creating a leading next-generation kids and youth animation business by focusing on digital platforms and content. The company's key assets include: the world's No. 1 digital animation network, Frederator Networks, which consists of an animation production company Frederator Studios, as well as VOD channels on digital platforms; the world's first Hispanic animation network, Atomo Network, a joint venture with Anima Estudios; and one of Canada's largest, multifaceted animation production studios, Rainmaker Entertainment, which consists of Mainframe Studios that produces CGI animated television series, and Rainmaker Studios that produces long-form animated features.
- END RELEASE - 30/05/2017
For further information:
Further information available at:
Website: www.wowunlimited.co
Contact: Lowell Hall
Tel: (416) 887-1636
Email: Lowell@irelandandhall.com
COMPANY:
FOR: WOW! UNLIMITED MEDIA INC.
TSX VENTURE Symbol: RNK.A
TSX VENTURE Symbol: RNK.B
INDUSTRY: Media and Entertainment - Movies/Music Videos RELEASE ID: 20170530CC017
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