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Canton, Ohio –(Business Wire) — Hall of Fame Resorts Entertainment, Inc. (NASDAQ: HOFV, HOFVW) (the “Company”), the only resort, entertainment and media company with professional football power at its core, announced its fiscal 2022 Second quarter results ended June 30, 2022.
“This quarter represented an inflection point in the company’s evolution as we operate and build on the physical and virtual foundations we’ve built over the past few years,” said President and CEO Michael Crawford. “We have made significant progress across all verticals and we continue to move the ball to the field. During the second and third quarters, we had a number of large events on campus where we were able to leverage the benefits of many of our assets. Synergy. We welcomed thousands of guests during worship week, including the kickoff of the NFL season, the worship ceremony, the Legends concert, and then ended the weekend with Dave Chappelle. The vertical media pilot was great inspired and start football paradise, a first-of-its-kind podcast highlighting our access to incredible content and stories from the world of professional football. The game launched the second season of Fantasy League (“HOFL”) vertically and filed the necessary applications with the Ohio Casino Control Commission to obtain the necessary sports betting licenses. While there is still more to do, the company has transformed into an operational destination that offers fans and consumers multiple unique engagement opportunities. ”
Key Financial Highlights
Second-quarter revenue was $2.7 million, an increase of 14% compared to the same period last year, primarily driven by hotel revenue and event revenue related to events held at the Johnson Controls-backed Hall of Fame Village.
Net loss attributable to shareholders in the second quarter was $9.2 million, compared with net income of $15.5 million in the same period last year. The change in fair value of the warrant liability is the main driver of the difference between the two periods.
Adjusted EBITDA lost $6.1 million in the second quarter, compared with a loss of $5.6 million in the year-ago quarter, primarily due to higher expenses related to payroll, benefits and insurance costs. See page 3 for a reconciliation of net loss to EBITDA and Adjusted EBITDA.
The company ended the fiscal quarter with a cash balance of $17.8 million, including restricted cash, compared to $12.8 million as of March 31, 2022. The increase in cash balance was due to higher capital expenditures related to construction activities partially offset by proceeds from construction-related financing and cash from operating activities.
Second Quarter Business Highlights
Several large multi-day events, including the USFL Playoffs and Championship Game, and three-day Father’s Day, were held at the Johnson Controls-supported Village of Fame (“Village of Fame”).
Two additional funding sources were obtained to support the construction of the Performance Centre. The company closed a $4 million loan with Midwest Lender Fund, LLC. In addition, the City of Canton, in coordination with the Canton Area Energy Special Improvement District, approved legislation that enables the company to advance $3.2 million in Property Appraisal Clean Energy (“PACE”) financing.
Shared details around Play-Action Plaza, which will feature multiple attractions, including only two of its kind in Stark County, Ohio.
pilot episode Inspiration: Heroes of Change It premiered on Grey TV’s 100 channels in early June.
Announcing a partnership with entertainment facility The SportDome and its owners, the Kempthorn family, to move the operations of the local sports league to the performance center.
After the season finale
Received additional funding, including $33.4 million in PACE financing related to the Tom Benson Hall of Fame Stadium.
Announced for Season 2 of the Fantasy League (“HOFL”), featuring Pro Football Hall of Fame running back and Dallas Cowboys legend Emmitt Smith as commissioner.
Announcing a 10-year partnership with Betr as the company’s official mobile sports betting partner. The agreement also gives HOFV a limited equity interest in Betr, revenue sharing, and provides opportunities for cross-marketing, branding and engagement with consumers of both companies.
Announcing the launch football heaven, The first video podcast produced in partnership with the Pro Football Hall of Fame. football paradise Some of the most fascinating stories and characters in professional football history will be explored.
Multi-year sponsorship agreements with Molson Coors and Sugardale.
telephone conference
The company will host a conference call and webcast beginning Friday, August 12, 2022 at 8:30 a.m. ET to provide business commentary. Investors and all other stakeholders can view the webcast and replay on the company’s website: ir.hofreco.com.
About Hall of Fame Entertainment
Hall of Fame Resorts and Entertainment, Inc. (NASDAQ: HOFV, HOFVW) is a resort and entertainment company that leverages the power and visibility of professional football and its legendary players to partner with the Pro Football Hall of Fame. Headquartered in Canton, Ohio, Hall of Fame Resort and Entertainment is the owner of the Village of Fame, supported by Johnson Controls, a multi-purpose sports, entertainment and media destination centered on the Pro Football Hall of Fame campus.For more information about the company, please visit www.HOFREco.com.
forward-looking statements
Certain statements 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 such as “opportunity,” “future,” “will,” “target,” “enable,” “pipeline,” “transition,” “going forward,” “towards,” “construction,” “coming soon.” ” and “outlook” and similar statements that predict or indicate future events or trends or are not statements of historical events. 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 company’s control, that could cause actual results or outcomes materially different from those discussed in the forward-looking statements. Important factors that could affect actual results or results include, among other things, the company’s ability to manage growth; the company’s ability to execute its business plans and achieve its forecasts, including obtaining funding to build planned facilities; potential litigation involving the company; applicable law or Changes in regulations; general economic and market conditions affecting demand for company products and services, particularly in the vacation and entertainment industries; ongoing global coronavirus (COVID-19) pandemic on capital markets, the general economy conditions, unemployment, and the impact on the company’s liquidity, operations, and personnel; increased inflation; the inability to maintain a NASDAQ listing of the company’s stock; and the risks and uncertainties discussed from time to time in our reports to the SEC and other public filings sex. Except as required by law, the company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measures
The company reports its financial results in accordance with generally accepted accounting principles in the United States (“GAAP”) and corresponding measures that are non-GAAP financial measures. This presentation includes references to the following non-GAAP financial measures: EBITDA and Adjusted EBITDA. These are important financial measures used in business management, including decisions about resource allocation and performance evaluation. Management believes that reporting these non-GAAP financial measures is useful to investors because these measures are representative of the company’s performance and improve the comparability of performance. See the table below for definitions of the above non-GAAP financial measures and corresponding reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measures. Non-GAAP financial measures should be considered in addition to, and not as a substitute for, the company’s performance 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 used by the company in the same way.
During the three months ended June 30, | |||||||
2022 | 2021 | ||||||
| Adjusted EBITDA Adjustment | |||||||
| Net loss attributable to HOFRE shareholders | $ | (9,202,433 | ) | $ | 15,541,053 | ||
| (Benefits from) Income Tax Provision | – | – | |||||
| interest expense | 921,392 | 1,004,419 | |||||
| Depreciation expense | 3,527,581 | 2,972,130 | |||||
| Discounted Amortization of Notes Payable | 1,122,324 | 1,164,613 | |||||
| EBITDA | (3,631,136 | ) | 20,682,215 | ||||
| Changes in fair value of warrant liabilities | (2,423,000 | ) | (26,315,888 | ) | |||
| Adjusted EBITDA | $ | (6,054,136 | ) | $ | (5,633,673 | ) | |
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