Global Eagle Entertainment Inc.

CIK:0001512077|SEC Filings

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenue:
Total revenue	$ 83,041	$ 157,467	$ 227,206	$ 324,086
Cost of sales:
Cost of sales	71,879	124,217	192,686	258,411
Gross margin	11,162	33,250	34,520	65,675
Operating expenses:
Sales and marketing	4,303	7,365	9,643	15,614
Product development	3,749	6,125	9,712	13,104
General and administrative	24,962	27,161	55,538	55,141
Provision for legal settlements	0	25	0	533
Amortization of intangible assets	6,241	7,800	12,383	15,599
Goodwill and long-lived asset impairment	3,374	0	25,504	0
Total operating expenses	42,629	48,476	112,780	99,991
Loss from operations	(31,467)	(15,226)	(78,260)	(34,316)
Other (expense) income:
Interest expense, net	(22,884)	(22,329)	(45,471)	(43,606)
(Loss) income from equity method investments including impairment losses	(2,015)	2,517	(12,873)	4,646
Change in fair value of derivatives	(18)	0	189	938
Other expense, net	(1,495)	(105)	(1,263)	(284)
Loss before income taxes	(57,879)	(35,143)	(137,678)	(72,622)
Income tax expense	154	3,317	1,280	3,447
Net loss	$ (58,033)	$ (38,460)	$ (138,958)	$ (76,069)
Net loss per share – basic and diluted (in dollars per share)	$ (15.47)	$ (10.42)	$ (37.24)	$ (20.65)
Weighted-average shares – basic and diluted	3,751,000	3,690,000	3,731,000	3,682,000
Licensing and services
Revenue:
Total revenue	$ 77,457	$ 145,129	$ 213,102	$ 295,607
Cost of sales:
Cost of sales	67,772	116,308	181,056	239,577
Equipment
Revenue:
Total revenue	5,584	12,338	14,104	28,479
Cost of sales:
Cost of sales	$ 4,107	$ 7,909	$ 11,630	$ 18,834

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
OPERATING ACTIVITIES:
Net loss	$ (138,958)	$ (76,069)
Adjustments to reconcile net loss to net cash used in operations:
Depreciation and amortization	38,266	43,477
Amortization of right-of-use asset	4,039	2,557
Amortization of content library	3,773	3,570
Non-cash interest expense, net	16,402	14,220
Change in fair value of derivatives	(189)	(938)
Change in fair value of equity security investments	1,357	0
Stock-based compensation	2,180	3,616
Impairment of goodwill and long-lived assets	26,611	0
Tax effect of Second Lien Notes’ beneficial conversion feature	0	(2,688)
Loss on disposal of fixed assets	0	357
Proceeds from equity method investments	3,675	0
(Gain) loss on equity method investments including impairment losses	12,873	(4,646)
Provision for expected credit losses	2,447	830
Deferred income taxes	(1,911)	(624)
Other non-cash adjustments	0	388
Changes in operating assets and liabilities:
Accounts receivable	14,212	4,992
Inventories	1,722	(1,420)
Prepaid expenses and other current assets	1,179	4,087
Content library	(3,792)	(1,647)
Other non-current assets	1,631	(12,463)
Accounts payable and accrued liabilities	3,397	11,474
Deferred revenue	(3,958)	2,378
Other liabilities	(9,660)	10,521
Net cash (used in) provided by operating activities	(24,704)	1,972
INVESTING ACTIVITIES:
Purchases of property and equipment	(2,142)	(13,442)
Net cash used in investing activities	(2,142)	(13,442)
FINANCING ACTIVITIES:
Proceeds from borrowings on revolving credit facility	44,300	34,650
Repayment of revolving credit facility	(7,000)	(46,250)
Repayments of indebtedness	(4,094)	(10,109)
Borrowings from related party	5,000	7,350
Payment of satellite purchase financing	0	(2,300)
Net cash provided by (used in) financing activities	38,206	(16,659)
Effects of exchange rate changes on cash, cash equivalents and restricted cash	296	199
Net increase (decrease) in cash, cash equivalents and restricted cash	11,656	(27,930)
Cash, cash equivalents and restricted cash at beginning of period	24,462	39,955
Cash, cash equivalents and restricted cash at end of period	36,118	12,025
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for taxes	706	1,256
Cash paid for interest	28,767	28,417
SIGNIFICANT NON-CASH ACTIVITIES:
Purchase consideration for equipment included in accounts payable	195	1,530
Conversion of PIK interest on our Second Lien Notes to additional principal	10,682	9,507
Financing of purchased satellite transponders included in property and equipment	0	8,500
Distribution from equity method investments offset against demand promissory note	$ 0	$ 4,410

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
CURRENT ASSETS:
Cash and cash equivalents	$ 31,255	$ 23,964
Restricted cash	4,863	498
Short-term investment	3,315	0
Accounts receivable, net	66,385	88,219
Inventories, net	24,972	26,695
Prepaid expenses	5,574	6,753
Other current assets	10,513	12,839
TOTAL CURRENT ASSETS	146,877	158,968
Content library	2,825	3,645
Property and equipment, net	116,996	145,295
Right-of-use assets, net	32,797	39,187
Goodwill	137,400	159,607
Intangible assets, net	43,097	55,483
Equity method investments	62,284	78,886
Other non-current assets	25,705	27,509
TOTAL ASSETS	567,981	668,580
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	181,679	178,930
Deferred revenue	8,359	12,317
Current portion of long-term debt and finance leases	810,887	15,678
Current portion of operating lease liabilities	7,265	8,319
Other current liabilities	9,927	7,081
TOTAL CURRENT LIABILITIES	1,018,117	222,325
Deferred revenue, non-current	86	86
Long-term debt and finance leases	16,138	757,384
Long-term operating lease liabilities	20,856	23,636
Deferred tax liabilities	2,496	5,894
Other non-current liabilities	23,146	34,409
TOTAL LIABILITIES	1,080,839	1,043,734
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ DEFICIT:
Preferred stock, $0.0001 par value; 1,000,000 shares authorized, no shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively	0	0
Common stock, $0.0001 par value; 375,000,000 shares authorized, 3,876,801 and 3,837,920 shares issued, 3,754,656 and 3,715,775 shares outstanding, at June 30, 2020 and December 31, 2019, respectively	10	10
Treasury stock, 122,145 shares at June 30, 2020 and December 31, 2019	(30,659)	(30,659)
Additional paid-in capital	821,224	818,961
Subscriptions receivable	(597)	(597)
Accumulated deficit	(1,303,146)	(1,162,901)
Accumulated other comprehensive income	310	32
TOTAL STOCKHOLDERS’ DEFICIT	(512,858)	(375,154)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$ 567,981	$ 668,580