Brilliant Digital Entertainment Reports First Quarter 2002 Results; Successfully Completes Financing Round of $1.25 Million.Business Editors LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--May 15, 2002 Brilliant Digital Entertainment, Inc. (AMEX AMEX See: American Stock Exchange :BDE See Borland Database Engine. ), a leading developer of 3D technologies for rich media content creation, distribution and ad serving for 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 , today reported net revenues for the first quarter ended March 31, 2002 declined 25% to $293,000 from $390,000 in the comparable first quarter of 2001. Brilliant Digital reported a net loss of ($1,311,000), or ($0.07) per share, for the first quarter ended March 31, 2002, compared to a net loss of ($2,135,000), or ($0.13) per share for the first quarter of 2001. The loss from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the , excluding the operations of The Auction Channel, was ($1,311,000), or ($0.07) per share, for the first quarter ended March 31, 2002, compared to a loss of ($1,675,000), or ($0.10) per share for the first quarter of 2001. Furthermore, in addition to the previously announced completion of a private placement financing transaction on April 1, 2002 in which the company raised $800,000, Brilliant Digital raised an additional $450,000 through the sale of common stock and warrants. These funds will allow Brilliant Digital to continue to pursue sales of its rich media Brilliant Banner and contribute to the further development of Altnet's secure peer-to-peer network (1) A network of computers configured to allow certain files and folders to be shared with everyone or with selected users. Peer-to-peer networks are quite common in small offices that do not use a dedicated file server. . "Despite the drop in revenues from the comparative first quarter of 2001, we are seeing dramatic improvements to our bottom line resulting from our cost-cutting initiatives which were put into place in the last quarter of 2001. The comparison is even more dramatic when evaluating the loss from a cash flow perspective, as much of the loss can be attributed to non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. . This positions us well for the future and, combined with our progress of our rich media Brilliant Banner advertising Banner Advertising A common form of advertising on the internet. The banner is an advertisement of 460x68 pixels, usually placed at the top of the page Notes: For an example, just look at the top of a page on almost any popular web site. format and our initiatives in developing a secure peer-to-peer network, gives us added optimism," said 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 and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Brilliant Digital Entertainment. About Brilliant Digital Entertainment Brilliant Digital Entertainment, Inc. (AMEX:BDE) is a developer of 3D rich media advertising and content creation technologies for the Internet. It sells its b3d Studio content creation and authoring toolset to enable the creation and delivery of interactive, streaming, real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. 3D graphics over the Internet, and licenses its ad serving technology to the content and advertising communities. The b3d Studio toolset is targeted for use by studios, production houses, web content suppliers and advertising agencies to produce entertainment, advertising and music content for consumers distributed over the Internet. Brilliant also licenses its Brilliant Banner ad A graphic image used on Web sites to advertise a product or service. Banner ads come in numerous sizes, but are often rectangles 460 pixels wide by 60 pixels high. Also 460 x 55 and 392 x 72 sizes are commonly used. serving technology to the web based Coming from a Web server. See Web application. advertising industry. Find out more at www.brilliantdigital.com. For further information, please contact Robin Gore at 818/615-1500 x528 or rgore@bde3d.com. Information about Forward Looking Statements Statements in this news release that relate to (i) Brilliant's future cost-cutting initiatives, (ii) sales of Brilliant Banner advertising, (iii) development of Altnet's peer-to-peer network, and (iv) other 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, including (a) our ability to raise additional funding, (b) consumer and advertiser ad·ver·tise v. ad·ver·tised, ad·ver·tis·ing, ad·ver·tis·es v.tr. 1. To make public announcement of, especially to proclaim the qualities or advantages of (a product or business) so as to increase demand for Brilliant Banners, (c) Brilliant's ability to continue to distribute its digital projector See data projector. pursuant to third party agreements, (d) the release of competing technology, (e) the market for Internet advertising Delivering ads to Internet users via Web sites, e-mail, ad-supported software and Internet-enabled cellphones. Also called an "ad network," Internet advertising organizations act as a middleman between the advertiser and the Web sites and software publishers that display the ads. , and (f) those factors set forth in Brilliant's most recently filed Form 10-KSB and Form 10-QSB reports which 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 Robin Gore, at 818/615-1500 x528 or rgore@bde3d.com.
BRILLIANT DIGITAL ENTERTAINMENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(unaudited, in thousands)
March 31
2002
---------
Assets
Cash and cash equivalents $771
Accounts receivable, net 71
Other current assets 236
---------
Total current assets 1,078
Other assets 532
---------
Total assets $1,610
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Liabilities and stockholders' equity
Current liabilities $1,601
Deferred revenue 3,243
Capital financing, net of discount 1,123
Long-term liabilities 70
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Total liabilities 6,037
Total stockholders' deficit (4,427)
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Total liabilities and stockholders' deficit $1,610
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BRILLIANT DIGITAL ENTERTAINMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands)
Three Months
Ended March 31,
---------------------
2002 2001
--------- ---------
(unaudited) (unaudited)
Revenues $293 $390
Costs and expenses:
Costs of revenues 52 33
Sales and marketing 22 297
General and administrative 557 1,007
Research and development 90 678
Depreciation and amortization 17 120
-------- --------
738 2,135
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Loss from operations (445) (1,745)
Other income (expense):
Export market development grant -- 33
Other income (expense) (866) 37
-------- --------
Total other income (expense) (866) 70
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Loss from continuing operations (1,311) (1,675)
Loss from discontinued operations -- (460)
-------- --------
Net loss before income taxes (1,311) (2,135)
Provision for income taxes -- --
-------- --------
Net loss (1,311) (2,135)
Foreign currency translation
adjustment (net of tax effects) (4) (62)
-------- --------
Comprehensive loss $(1,315) $(2,197)
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Basic and diluted continuing
operations loss per share (0.07) (0.10)
Basic and diluted for discontinued
operations per share (0.00) (0.03)
Basic and diluted net loss per share $(0.07) $(0.13)
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Weighted average number of shares
used in computing basic and diluted
net loss per share 17,850 16,054
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