Home Entertainment company Hall of Fame Resort & Entertainment Company Announces First Quarter 2022 Results

Hall of Fame Resort & Entertainment Company Announces First Quarter 2022 Results

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CANTON, Ohio–(BUSINESS WIRE)–Hall of Fame Resort & Entertainment Company (NASDAQ: HOFV, HOFVW) (the “Company”), the only resort, entertainment and media company focused on the power of professional football, announced its first quarter results of fiscal year 2022 for the period ended March 31, 2022.

“We continue to evolve and become operational as a business, building both physically and virtually with a focus on customer experience,” said Michael Crawford, President and CEO. “Early critical testing is underway in funding as execution has been the name of the game. We look forward to sharing a number of highlights achieved during the first quarter on Wednesday morning. Our team was able to successfully announce dynamic new campus events, add engaging content to our media business, and continue to grow our games vertical. Additionally, the Company has secured the necessary financing and expects to announce several additional Phase II loan instruments in the coming weeks. It’s a very exciting time as the company transforms into an operational destination with multiple unique engagement opportunities, showing progress and increases year-over-year and quarter-over-quarter. We look forward to welcoming fans to the newly constructed assets for Dedication Week in early August and entertaining our guests through various experiences in our media and gaming sectors as well.

Main Financial Highlights

  • First quarter revenue was $2.1 million, an increase of 10% over the same prior year period, primarily driven by hotel revenue and event revenue from hosted events at the Hall of Fame Village powered by Johnson Controls.

  • Net loss attributable to shareholders for the first quarter was $8.1 million, compared to a loss of $126.1 million in the same period last year. The change in the fair value of the warrant liability was the main factor in the difference between the two periods.

  • Adjusted EBITDA for the first quarter was a loss of $6.9 million, compared to a loss of $5.1 million in the same prior year period, resulting from increased expenses related to the increase in legal and professional fees, payroll and benefits and insurance costs. See page 3 for a reconciliation of net loss to EBITDA and adjusted EBITDA.

  • The Company ended its fiscal quarter with a cash balance, including restricted cash, of $12.8 million, compared to $17.4 million as at December 31, 2021. The decrease in the cash balance is due to increased capital expenditures related to construction activities, partially offset by proceeds from sales of common shares and cash provided by operating activities.

First Quarter Business Highlights

  • Announcement of the company’s strategy for obtaining sports betting game licenses.

  • Announcing a $38 million debt restructuring, pushing back short-term debt maturing in calendar year 2022 and extending debt instrument maturities by at least twelve months.

  • Announcing a partnership with leading sports marketing company Allied Sports as the go-to agency for sponsorship and media opportunities.

  • Announcing a partnership with the Pro Football Hall of Fame and I Got It to develop, market and sell digital assets and NFTs centered around some of the most iconic moments and coveted memories in gaming history, which are commemorated inside the Pro Football Hall of Fame in Canton, Ohio.

  • The Hall of Fantasy League (“HOFL”) inaugural season wraps up with a season recap on Twitch co-hosted by former NFL player Ahman Green and Jeff Eisenband.

  • Announcing a multi-year partnership with the Cleveland Clinic to make the global healthcare leader the official healthcare provider of Hall of Fame Village Sports Complex and Tom Benson Hall of Fame Stadium.

  • Announced, it will host the 2022 Concert for Legends Presented by Ford, headlined by the Rock and Roll Hall of Fame’s legendary rock band Journey. The concert will take place during this year’s Professional Football Hall of Fame enshrinement week.

Post Quarter End Highlights

  • Details shared regarding the Play-Action Plaza, which will feature multiple attractions, including the only two rides of its kind in Stark County, Ohio – a giant Ferris wheel with 20 gondolas equipped to seat six to eight people each and a Soaring Football Zipline.

  • Securing two additional sources of funding that will be used for the construction of the Center for Performance. The company recently closed a $4 million loan with Midwest Lender Fund, LLC. Additionally, the City of Guangzhou, in coordination with the Canton Regional Energy Improvement District, has approved legislation that will allow the company to move forward with $3.2 million in funding. for Property Rated Clean Energy (PACE).

  • Announcing a collaboration with The SportDome recreation facility and its owners, the Kempthorn family, to transfer the operation of local sports leagues to the Center for Performance.

Conference call

The Company will host a conference call and webcast on Wednesday, May 11, 2022, beginning at 8:30 a.m. ET, to provide comment on the business. Investors and all other interested parties can access the live webcast and replay on the Company’s website: ir.hofreco.com.

About Hall of Fame Resort & Entertainment Company

Hall of Fame Resort & Entertainment Company (NASDAQ: HOFV, HOFVW) is a resort and entertainment company leveraging the power and popularity of professional football and its legendary players in partnership with the Pro Football Hall of Fame. Based in Canton, Ohio, Hall of Fame Resort & Entertainment Company owns Hall of Fame Village powered by Johnson Controls, a multi-purpose sports, entertainment and media destination centered on the Pro Football Hall of Fame campus. Famous. Additional information about the Company is available at www.HOFREco.com.

Forward-looking statements

Certain statements made herein are “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words and expressions such as “opportunity,” “future,” “will,” “goal,” “enable,” “pipeline,” “transition,” “move forward,” “toward,” “build,” “come” and “looking ahead” and similar expressions that predict or indicate future events or trends or are not statements of historical matters. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company, which may result in actual earnings or results. differ materially from those discussed in the forward-looking statements. Important factors that could affect actual results or results include, among others, the Company’s ability to manage growth; the Company’s ability to execute its business plan and meet its projections, including obtaining financing to construct planned facilities; potential litigation involving the Company; changes in applicable laws or regulations; general economic and market conditions affecting demand for the Company’s products and services, and in particular economic and market conditions in the resort and entertainment industry; the effects of the current global coronavirus (COVID-19) pandemic on capital markets, general economic conditions, unemployment and Company liquidity, operations and personnel; increase in inflation; the inability to maintain the listing of the Company’s stock on Nasdaq; and the risks and uncertainties discussed from time to time in our reports and other public filings with the SEC. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures

The Company presents its financial results in accordance with United States generally accepted accounting principles (“GAAP”) and related measures as non-GAAP financial measures. The presentation includes references to the following non-GAAP financial measures: EBITDA and Adjusted EBITDA. They are important financial measures used in business management, including decisions about resource allocation and performance evaluation. Management believes that the disclosure of these non-GAAP financial measures is helpful to investors because these measures are representative of the Company’s performance and provide better comparability of results. See the table below for the definitions of the non-GAAP financial measures referenced above and the corresponding reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measures. Non-GAAP financial measures should be considered additions to, and not alternatives to, the Company’s results prepared in accordance with GAAP. In addition, the non-GAAP measures used by the company may differ from the non-GAAP measures used by other companies, and other companies may not define the non-GAAP measures the company uses in the same way. way.

For the three months ended March 31

2022

2021

Reconciliation of Adjusted EBITDA
Net loss attributable to shareholders of HOFRE

$

(8,112,097

)

$

(126 147 182

)

(Benefit from) provision for income taxes

Interest expense

1,213,541

955 308

Depreciation expense

3,242,285

2,920,937

Amortization of discount on notes payable

1,355,974

1,234,114

EBITDA

(2,300,297

)

(121,036,823

)

Loss (gain) on extinguishment of debt

148,472

(390 400

)

Change in fair value of warrant liability

(4,750,000

)

116,351,000

Adjusted EBITDA

$

(6,901,825

)

$

(5,076,223

)