Brilliant Digital Entertainment Reports 1998 Results; Reviews Progress and Opportunities for 1999 and Beyond.LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--April 1, 1999--Brilliant(TM) Digital Entertainment, Inc. (AMEX AMEX See: American Stock Exchange :BDE See Borland Database Engine. ; http://www.multipathmovies.com), today announced operating results for the fourth quarter and full year ended December 31, 1998. The Company also reviewed its increased focus on 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 opportunities, progress in technology development, Multipath(TM) Movie and Webisode(TM) production, expanding base of distribution relationships and increasing awareness of, and traffic on, its Internet web site. Brilliant's achievements over the past year include: -- Internet launch of 16 Multipath Movie Episodes and Webisodes - shorter duration, serialized and easily downloaded versions of Multipath Movie episodes. -- Launch of the Digital Projector See data projector. (TM) technology, an easily downloaded viewing technology that operates within versions of Microsoft Explorer and Netscape Navigator An earlier Web browser for Windows, Macintosh and X Windows from Netscape that provided secure transmission over the Internet. Soon after its introduction in 1994, Navigator, or just "Netscape," as it was commonly called, quickly became the leading browser on the Web. web browsers The following is a list of web browsers. Historical Historically important browsers In order of release:
200,000 copies have been downloaded to date. -- New distribution relationships established with @Home, DVD DVD: see digital versatile disc. DVD in full digital video disc or digital versatile disc Type of optical disc. The DVD represents the second generation of compact-disc (CD) technology. EXPRESS, Mediadome and GameStorm further expanding consumer access, on the Internet, to Brilliant content and technology. -- January 1999 distribution of CD ROM CD ROM Compact Disk Read Only Memory products into retail. Performance in Wal-Mart stores was positive, resulting in re-orders and roll out to additional stores. -- Output of first high resolution animation, featuring Gravity Angels. Interest in the project was very high at the annual NATPE NATPE National Association of Television Programming Executives television industry convention. A complete two-hour episode is soon to be released. -- Launch of B3D-Minimize for Max, real time animation tool to the BETA test A test of new or revised hardware or software that is performed by users at their facilities under normal operating conditions. Beta testing follows alpha testing. Vendors of packaged software often offer their customers the opportunity of beta testing new releases or versions, and the market. Industry previews have been positive, and the tool is now complete and ready for release during April 1999. B3D B3D Bodypaint 3D Format (filename extension) B3D Building Better Business Decisions (Wafi C&TS) enables animators Famous animators no longer living
back on the Internet using Brilliant's proprietary Digital Projector. -- Multipath Movie title distribution is expanded via SlingShot (networking, business, tool, product, protocol) Slingshot - CSK Software's real time financial server for the Internet. Slingshot allows the delivery of real time market data across the Internet and private intranets quickly, cheaply and securely. to the DVD market using pre-rendered hi-fidelity audio and video technology. Roll-out will broaden the availability of titles in retail which are targeted to a platform designed for a more traditional living room viewing experience than the PC. -- Data compression data compression Process of reducing the amount of data needed for storage or transmission of a given piece of information (text, graphics, video, sound, etc.), typically by use of encoding techniques. enhancements enable certain existing and future Multipath Movie titles or animation created using the b3d file format to be reduced in size by more than 40% with further reductions possible. The first titles to take advantage of these developments will be released in Q2 1999 and will include Superman Superman invincible scourge of crime. [Comics: Horn, 642–643] See : Crime Fighting Superman superhero under guise of Clark Kent, mild-mannered reporter. . The enhancements take Multipath a step closer to being accessible by the majority of Internet users Internet user n → internauta m/f Internet user Internet n → internaute m/f with narrow-band access. 1998 Results: Brilliant's operating results reflect ongoing investment in the development of its Internet capabilities, the production of Multipath Movie episodes/Webisodes, the continued development of proprietary software tools and Internet Digital Projector technology and the formation of new distribution and product development relationships. Results for 1998 reflect the increased production of Multipath Movie episodes/Webisodes and the expensing of such costs beginning in the second quarter. Accordingly, Brilliant Digital reported a fourth quarter net loss of $(3,088,000), or $(0.33) per share, compared with a net loss of $(1,375,000), or $(0.17) per share, for the same period a year ago. Brilliant Digital's 1998 fourth quarter revenues were $224,000, principally reflecting retail sales of $191,000 for Multipath Movie CD ROM products and revenue of $33,000 under a Multipath Movie technology and content development agreement. For the year ended December 31, 1998, Brilliant Digital reported a net loss of $(9,425,000), or $(1.00) per share, compared to a net loss in the prior year of $(2,305,000), or $(0.31) per share. Revenues for 1998 were $431,000, compared to revenues of $2,481,000 in 1997, including $1,973,000 related to a distribution agreement with Packard Bell NEC (Packard Bell, The Netherlands, www.packardbell.com) A major PC manufacturer that is the consumer brand of NEC Computers International and the home computing market leader in the U.K. and much of Western Europe. . Kevin Bermeister Kevin Bermeister has developed substantial businesses in the computers, video games and multimedia industries. He established Ozisoft in 1982, based in Sydney, Australia, which was one of the first interactive multimedia companies. , President of Brilliant Digital, commented, "We are actively working to build upon our achievements in 1998 and remain keenly focused on the Internet. Our opportunities include licensing our development tools and applications to foster the creation of Internet-ready content and to develop a new Internet See Web 2.0 and Internet2. animation standard for use in entertainment, education and e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. ." "An important aspect of Brilliant's strategy is to position our production process and technology as an essential solution in the converging con·verge v. con·verged, con·verg·ing, con·verg·es v.intr. 1. a. To tend toward or approach an intersecting point: lines that converge. b. markets for television broadcast and Internet animation. Revenue will be generated from tools and technology licensing, content co-production and joint venture content distribution with the more established distribution partners in the television broadcast and on-line markets. Having entered the market early, we are well positioned to leverage our solutions in the rapidly evolving market for Internet and new media content." Brilliant continues to carefully consider new business opportunities that could be strategic to the development of the Company and currently is in discussions and performing due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc such a possible acquisition by Brilliant. The Company has not determined to proceed with the possible acquisition and cautions that there can be no assurance that its discussions will lead to any acquisition or that any acquisition, if consummated con·sum·mate tr.v. con·sum·mat·ed, con·sum·mat·ing, con·sum·mates 1. a. To bring to completion or fruition; conclude: consummate a business transaction. b. , will be beneficial to Brilliant. Brilliant has also determined to file a Form 12b-25, deferring for up to 15 days the filing of its annual report on Form 10-KSB, noting that is unable at this time, without unreasonable effort and expense, to file its Annual Report on Form 10-KSB for the year ended December 31, 1998. About Brilliant Digital Entertainment: Brilliant Digital Entertainment (http://www.multipathmovies.com) is the production studio responsible for creating Multipath Movies, a new generation of digital entertainment to be distributed over the Internet, on CD-ROM CD-ROM: see compact disc. CD-ROM in full compact disc read-only memory Type of computer storage medium that is read optically (e.g., by a laser). , as television programming and for home video. Multipath Movies are developed using proprietary, technologically advanced software tools that produce three-dimensional, digitally animated stories, each with multiple user-influenced plot alternatives or paths that lead to a variety of distinct conclusions. Brilliant Digital has formed strategic alliances with Packard Bell NEC, CompuServe, British Telecom The telephone and communications carrier that provides services in Great Britain and Northern Ireland. It used to be a division of the British Post Office, but was privatized in 1984 under Margaret Thatcher's administration. , DVD EXPRESS, Kesmai's GameStorm and @Home to distribute its Multipath Movies over the Internet's World Wide Web and has acquired the exclusive worldwide interactive rights to Bantam Bantam Former city and sultanate, Java. It was located at the western end of Java between the Java Sea and the Indian Ocean. In the early 16th century it became a powerful Muslim sultanate, which extended its control over parts of Sumatra and Borneo. Doubleday Dell Books for Young Readers for the Choose Your Own Adventure series of interactive books. Brilliant has also signed content license agreements for the following properties: Ace Ventura (Morgan Creek Productions), KISS, Popeye (King Features), Superman (DC Comics) and Xena (Universal Studios). The company is headquartered in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , CA with offices in Bondi Junction and Double Bay, Australia and Middlesex, England. Information about Forward Looking Statements: Statements in this news release that relate to future plans, financial results or projections, events or performance are 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 Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Act of 1934, as amended. Actual results may differ materially due to a variety of factors. Forward looking statements include (i) Brilliant's stated expectation that its B3D tool will be released during April 1999, (ii) Brilliant's expectation that licensing of its development tools and applications can foster the creation of Internet-ready content and to develop a new Internet animation standard for use in entertainment, education and e-commerce, (iii) Brilliant's expectation that revenue will be generated from tools and technology licensing, content co-production and joint venture content distribution with the more established distribution partners in the television broadcast and on-line markets, and (iv) Brilliant's expectation that a complete two-hour episode of Gravity Angels is soon to be released to the market. Brilliant's ability to complete and timely release its titles and tools projected for release is subject to a number of factors and risks including the Company's ability to complete quality assurance testing of titles and tools and the ability of Brilliant or its distribution partners to conclude distribution and marketing arrangements in a highly competitive environment. Brilliant's ability to successfully license its development tools and applications to foster the creation of Internet-ready content and to develop a new Internet animation standard and generate revenue from tools and technology licensing, content co-production and joint venture content distribution is subject to (i) the negotiation and/or implementation of distribution and marketing arrangements which are not certain of success, (ii) with respect to Internet distribution, overcoming consumer reluctance to initiate large downloads over low bandwidth Internet connections, (iii) with respect to retail markets, the ability of the Company to manufacture, package and ship its products on schedule and avoid delays and manufacturing capacity shortages inherent in the software distribution process, and (iv) many other risks described in the Company's most recently filed Form 10-KSB report and 10-QSB. If Brilliant is unable to timely release, market and distribute its new products, or if the products are not commercially successful, Brilliant's results will be materially adversely affected. Information about certain additional risk factors is contained in the Company's most recently filed Form 10-KSB report and 10-QSB report and are available from Brilliant Digital Entertainment's Investor Relations Investor relations The process by which the corporation communicates with its investors. department and may be obtained by calling or writing to our investor relations company, Jaffoni & Collins at 212-835-8500 or bde@jcir.com. -0-
BRILLIANT DIGITAL ENTERTAINMENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(unaudited)
(in thousands)
December 31,
1998
------------------
Assets
Cash and cash equivalents............ $ 3,187
Other current assets................. 2,449
------------------
Total current assets................. 5,636
Other assets......................... 1,817
------------------
Total assets......................... $ 7,453
==================
Liabilities and stockholders' equity
Current liabilities.................. $ 1,552
Long-term liabilities................ 343
------------------
Total liabilities.................... 1,895
Total stockholders' equity........... 5,558
------------------
Total liabilities and stockholders'
equity.............................. $ 7,453
==================
BRILLIANT DIGITAL ENTERTAINMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands)
3 months 3 months Year Year
ended ended ended ended
12/31/98 12/31/97 12/31/98 12/31/97
-------- -------- -------- --------
(unaudited) (unaudited) (audited) (audited)
Revenue:
Total revenues $ 224 $ 114 $ 431 $ 2,481
-------- -------- -------- --------
Cost of revenues and expenses:
Cost of revenues 958 26 1,383 44
Sales & marketing 511 704 1,785 1,090
General and administrative 912 558 2,936 2,214
Research and development 835 304 3,798 1,709
Depreciation 130 20 390 214
-------- -------- -------- --------
Total cost of revenues
and expenses 3,346 1,612 10,292 5,271
-------- -------- -------- --------
(Loss) from operations (3,122) (1,498) (9,861) (2,790)
Other income (expense):
Export market development
grant -- -- 73 148
Gain (loss) on foreign
exchange -- 26 (5) 27
Interest income (expense),
net 34 98 368 313
-------- -------- -------- --------
Total other income
(expense) 34 124 436 488
-------- -------- -------- --------
(Loss) before income taxes (3,088) (1,374) (9,425) (2,302)
Provision for income taxes (0) (1) (0) (3)
-------- -------- -------- --------
Net income (loss) $ (3,088) $ (1,375) $ (9,425) $ (2,305)
======== ======== ======== ========
Comprehensive income (loss) $ (2,939) $ (1,522) $ (9,353) $ (2,473)
======== ======== ======== ========
Basic and diluted net income
(loss) per share $ (0.33) $ (0.17) $ (1.00) $ (0.31)
======== ======== ======== ========
Common shares used in
computing basic income
(loss) per share 9,403 7,201 9,403 7,384
======== ======== ======== ========
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