BigStar Reports Second Quarter 1999 Financial Results; Revenues Increase 106.5% over First Quarter 1999.NEW YORK--(BUSINESS WIRE)--Aug. 26, 1999-- BigStar Entertainment Inc. (Nasdaq: BGST BGST Bradley Gunnery Skills Test ), which operates BigStar.com, the leading online filmed entertainment superstore su·per·store n. A very large retail store that stocks highly diversified merchandise, such as groceries, toys, and camera equipment, or a wide variety of mechandise in a specific product line, such as computers or sporting goods. dedicated exclusively to filmed entertainment products, today announced financial results for the second quarter of 1999. In August 1999, BigStar completed its initial public offering of 2.5 million shares of common stock. For the quarter ended June June: see month. 30, 1999, the Company reported net revenues of $3,001,546 compared to $14,925 for the quarter ended June 30, 1998. For the quarter ended June 30, 1999, net revenues included $283,612 in barter barter: see exchange. barter Direct exchange of goods or services without the use of money or any other intervening medium of exchange. Barter is conducted either according to established rates of exchange or by bargaining. advertising. The Company did not have advertising revenues in previous quarters. Sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen , revenues increased 106.5% from the $1,453,780 for the quarter ended March 31, 1999. For the quarter ended June 30, 1999 gross profit increased to $444,915, resulting in a gross margin of 14.8%. The gross profit increased $244,974, with the related gross margin increasing 1%, from the $199,941 gross profit and 13.8% gross margin reported for the quarter ended March 31, 1999. BigStar's net loss was $4,821,842 for the second quarter of 1999 compared to a net loss of $247,135 for the second quarter of 1998. Basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. net loss per share was $0.82 for the second quarter of 1999 compared to $0.10 for the second quarter of 1998. For the six months ended June 30, 1999, revenues were $4,455,326. For the six months ended June 30, 1999 gross profit was $644,856, resulting in a gross margin of 14.5%. For the six months ended June 30, 1999, BigStar's net loss was $7,787,609 compared to a net loss of $275,618 for the six months ended June 30, 1998. Basic and diluted net loss per share was $1.60 per share for the six months ended June 30, 1999 compared to $0.12 per share for the six months ended June 30, 1998. BigStar Entertainment, Inc. (http://www.bigstar.com) is the leading online filmed entertainment superstore based on customer traffic to its websites, that is exclusively dedicated to filmed entertainment products. BigStar sells videos, digital videodiscs See DVD. , or DVDs, and laserdiscs. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995: BigStar Entertainment, Inc. has included in this press release certain "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act of 1995 concerning BigStar's business, operations and financial condition. The words or phrases "can be", "expects", "may affect", "may depend", "believes", "estimate", "project" and similar words and phrases Words and Phrases® A multivolume set of law books published by West Group containing thousands of judicial definitions of words and phrases, arranged alphabetically, from 1658 to the present. are intended to identify such forward-looking statements. Such forward-looking statements are subject to various known and unknown risks and uncertainties and BigStar cautions you that any forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information provided by or on behalf of BigStar is not a guarantee of future performance. Actual results could differ materially from those anticipated in such forward-looking statements due to a number of factors, some of which are beyond BigStar's control, in addition to those discussed in BigStar's other press releases, public filings and statements by BigStar's management, including (i) the volatile With regard to computer memory, it means "temporary" and not "highly changeable," which is the usual meaning of the word. See volatile memory. 1. (programming) volatile - volatile variable. 2. (storage) volatile - See non-volatile storage. and competitive nature of the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the industry, (ii) changes in domestic and foreign economic and market conditions, (iii) the effect of federal, state and foreign regulation on BigStar's business, (iv) failure of BigStar, its vendors or other third parties to achieve Year 2000 compliance and (v) the effect of any future acquisitions. All such forward-looking statements are current only as of the date on which such statements were made. BigStar does not undertake any obligation to publicly update any forward-looking statement to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date on which any such statement is made or to reflect the occurrence of unanticipated events. -0-
Bigstar Entertainment
Balance Sheets as of June 30, 1999
and December 31, 1998
June 30, December 31,
1999 1998
-----------------------------
(unaudited)
Assets:
Cash and cash equivalents $ 4,594,382 $ 363,124
Cash held in escrow - 453,000
Accounts receivable, net of allowance 296,090 61,121
Prepaids and other current assets 243,708 8,711
-----------------------------
Total current assets 5,134,180 885,956
Property and equipment, net 910,835 452,134
Deferred registration costs 858,618 -
Other assets 27,111 -
-----------------------------
Total assets 6,930,744 1,338,090
=============================
Liabilities:
Accounts payable 1,344,724 380,540
Accrued expenses 2,170,824 1,197,776
Accrued payroll costs 90,000 243,240
Current portion of capital lease
obligation 829 2,226
-----------------------------
Total current liabilities 3,606,377 1,823,782
-----------------------------
Long term portion of
capital lease obligation 7,209 8,805
Stockholders' Equity (Deficit):
Preferred stock - -
Common stock 6,041 3,022
Additional paid-in capital 14,892,105 2,361,716
Subscribed stock - 453,000
Deferred compensation (545,558) (64,414)
Accumulated Deficit (11,035,430) (3,247,821)
-----------------------------
Total stockholders'
equity (deficit) 3,317,158 (494,497)
-----------------------------
Total liabilities and
stockholders' equity
(deficit) $6,930,744 $1,338,090
=============================
BIGSTAR ENTERTAINMENT, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
Six months Three months Six months Three months
ended ended ended ended
June 30, June 30, June 30, June 30,
1999 1999 1998 1998
--------------------------------------------------
NET SALES $ 4,455,326 $ 3,001,546 $ 14,925 $ 14,925
COST OF SALES 3,810,469 2,556,630 8,963 8,963
--------------------------------------------------
Gross profit 644,856 444,915 5,962 5,962
OPERATING EXPENSES
Sales and marketing 5,091,867 3,366,235 40,086 40,086
General and
administrative 1,542,757 867,555 114,294 101,013
Web site and software
development 1,868,320 1,085,922 127,200 111,998
--------------------------------------------------
Total operating
expenses 8,502,944 5,319,712 281,580 253,097
--------------------------------------------------
Loss from
operations (7,858,087) (4,874,796) (275,618) (247,135)
INTEREST INCOME, net 70,478 52,954 - -
==================================================
Net Loss $ (7,787,609) $ (4,821,842) $(275,618) $(247,135)
==================================================
PER SHARE INFORMATION:
Net loss per share -
Basic and diluted $ (1.60) $ (0.82) $ (0.12) $ (0.10)
==================================================
Weighted average common
shares outstanding -
Basic and diluted 4,862,962 5,851,330 2,290,224 2,360,463
==================================================
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