NTN Buzztime, Inc. Reports Second Quarter 2017 Results

CARLSBAD, Calif., Aug. 2, 2017

• Recorded GAAP net loss of $164,000 in Q2 2017, a $686,000 improvement compared to Q2 2016 
• Reported positive EBITDA for fifth consecutive quarter
• Regained NYSE American listing compliance
• Signed Licensing Agreement with Scientific Games

"In the second quarter of 2017, we grew revenue, increased deferred revenue, and posted our fifth consecutive quarter of positive EBITDA while we furthered our strategic initiatives," said Ram Krishnan, NTN Buzztime CEO. "Regarding our deployment of order and payment at Buffalo Wild Wings, we have begun ordering equipment and delivering integrations. And, for these efforts, we received a prepayment for equipment and services that is reflected in our second quarter results. In addition, we launched a new vertical, by partnering with Scientific Games, a leading player in the casino industry. We are leveraging our trivia content to create a bonusing game that lives on slot machines. We continue to make progress with our plans to unveil our next gen tablet with NFC capabilities that will enable Apple Pay, Android Pay and Samsung Pay in the fourth quarter. With steady execution and ongoing innovation, we believe we will drive long-term shareholder value."

Financial Results for the Second Quarter Ended June 30, 2017
Total revenues were $5.5 million for the second quarter of 2017, up from $5.4 million for the second quarter of 2016 and up from $5.2 million for the first quarter of 2017. The increase reflects higher other revenue that was partially offset by reduced subscription revenue due to lower site count. Direct costs were $1.6 million, down from $1.8 million for the same period in 2016 due to the lower sales-type lease revenues as well as reduced depreciation expense. Gross margin increased to 71%, from 66% in the prior year quarter. Selling, general and administrative expenses were $3.9 million, compared to $4.2 million for the same period in 2016. Net loss was $164,000, or $0.07 per share, compared to a net loss of $850,000, or $0.46 per share, for the second quarter of 2016.  EBITDA increased to $516,000, from $38,000 in the same period last year.   

EBITDA is defined as earnings before interest, taxes, depreciation and amortization and is not intended to represent a measure of performance in accordance with accounting principles generally accepted in the United States (GAAP).  Although EBITDA is positive for the second quarter of 2017, EBITDA may not be positive in future quarters. A detailed description and reconciliation of EBITDA and management's reasons for using this measure is set forth at the end of this press release.

Financial Results for the Six Months Ended June 30, 2017
Total revenues were $10.8 million, compared to $10.9 million for the six months ended June 30, 2016. Gross margin increased to 68%, up from 64% for the prior year period. Net loss, including $750,000 of non-recurring other income recorded in the first quarter, was $254,000, or $0.11 per share, compared to a net loss of $1.9 million, or $1.03 per share, for the prior year period.  EBITDA for the first six months of 2017 grew to $1.2 million, up from an EBITDA loss of $100,000 for the prior year period.   

Metric Review for the Quarter Ended June 30, 2017
The site count was 2,768 venues at June 30, 2017, compared to 2,788 as of March 31, 2017. Management anticipates the net site count will continue to fluctuate. As of June 30, 2017, BEOND platform installations increased to 2,125 venues, or 77% of the installed base, compared to 2,057 venues, or 74% of the installed base, as of March 31, 2017.