Cinedigm Management Discusses Q3 2014 Results - Earnings Call Transcript

|
 |  About: Cinedigm Corp. (CIDM)
by: SA Transcripts

Operator

Good day, ladies and gentlemen, and welcome to the Cinedigm Digital Cinema Corp. Fiscal 2014 Third Quarter Earnings Call. [Operator Instructions] As a reminder, today's program is being recorded. I would now like to introduce your host for today's program, Jill Calcaterra, EVP Corporate Communications and Investor Relations. Please go ahead.

Jill Newhouse Calcaterra

Good afternoon, and thank you for joining today's conference call. Participating in today's call are Cinedigm's Chairman and Chief Executive Officer, Chris McGurk; and Chief Operating Officer and CFO, Adam Mizel.

Before I hand the call over to management, please note that on this call, certain information presented contains forward-looking statements. These statements are based on management's current expectations and are subject to risks, uncertainties and assumptions. Potential risks and uncertainties that could cause the company's business and financial results to differ materially from these forward-looking statements are described in the company's periodic reports filed with the SEC from time to time. All of the information discussed on this call is as of today, February 13, 2014, and Cinedigm does not intend and undertakes no duty to, update future events or circumstances. In addition, certain of the financial information presented in this call represents non-GAAP financial measures.

And now, I'd like to turn the call over to Chris McGurk. Chris?

Christopher J. McGurk

Thanks, Jill, and thanks to everyone for joining us on today's call. I'll begin with a general update on our business and then review the substantial progress we've made with the integration of our recent acquisition of Gaiam Inc.'s entertainment unit, which we refer to as GVE. After that, Adam will review financial results for our fiscal third quarter, as well as guidance for the fourth quarter and second half of the year. Then we'll answer any questions you might have.

So let's get started. As we've discussed previously on these calls, we have been engaged in a 3-year process to completely transform Cinedigm to take full advantage of the rapidly evolving digital revolution. Our restructuring efforts over the last 3 years, including the sale of 2 non-core divisions, the acquisition of New Video and the complete refinancing of our balance sheet, were vital pieces of that transformation. Additionally, the accretive game-changing acquisition of GVE last October was a critical step in elevating the quality of our library, enhancing our distribution capabilities and expanding the breadth of opportunities for Cinedigm to be a key player in the digital entertainment revolution.

Cinedigm is now the largest physical and digital distributor in North America for independent film, TV and digital content, with exclusive multiyear relationships with a wide range of brand-name content suppliers, including the WWE, the NFL, National Geographic, Discovery Networks, Scholastic and The Jim Henson Company.

We now have a huge library of more than 33,000 films and TV episodes, as well as direct relationships with almost all physical and digital retailers, including Wal-Mart, Target, iTunes, Netflix and Amazon. We are a fully integrated independent studio, better positioned in digital than any of our competitors, with a nontheatrical retail business bigger than all but one of the major studios. And we have key assets in place to fully capitalize on the digital revolution by launching a series of premium digital networks. I'll get into more detail on the digital networks shortly, but first, let's discuss our integration efforts with GVE.

As expected, we've focused our energy over the last 4 months on the operational and cultural integration of GVE into Cinedigm. We've made great progress and are actually ahead of schedule, as we've exceeded the high end of the range of expected annualized operating synergies of roughly $3.4 million to $3.8 million. These benefits should be fully realized in Q4 and early next fiscal year. Also, as expected with a transaction of this size, we have experienced some challenges following the acquisition. Not surprisingly, GVE was unable to add significant new content deals during most of 2013, given the instability caused by the company's sales process. We anticipated this issue and subsequent to closing, put several new deals in place. As Adam will outline later, we completed the deals as intended, but in one significant transaction, the revenue will be recognized in future periods, which we did not anticipate.

We are now focusing aggressively in calendar 2014 on expanding the business and further building out our sales pipeline. The broad strength of our distribution reach across all platforms, combined with our strong track record in maximizing the value of independent content in both physical and digital channels, make Cinedigm an extremely attractive partner to branded content suppliers. Expect some announcements in this area soon.

As we've also discussed on these calls in the past, we believe that Cinedigm has the opportunity to be the leader in the emerging narrowcast digital channel business. Because of the company's transformation and more visible leadership position, we've just announced a deal with a key strategic partner for a direct-to-consumer branded digital network targeted to Comic-Con fans, which I will review in more detail momentarily.

The digital entertainment ecosystem is evolving quickly and digital channels can now deliver game-changing value by creating broadcast-quality entertainment experiences for very targeted audiences by providing them with the exact type of entertainment they want, wherever and whenever they want it, on the connected devices of their choice. And Cinedigm is uniquely well suited to succeed in this new business, given the enormous depth of our library, our digital assets and track record, our nontraditional releasing expertise and our marketing experience. Our vision is to be the narrowcasting version of a Hulu or a Netflix or an Amazon. And we believe from a shareholder's perspective, that at a relatively low level of investment and risk, we can deliver rapid growth and significant high-margin recurring revenues from these channels.

Now let me tell you a bit more about Comic-Con and its importance to our digital channel plans. Our new partner, Wizard World Comic Con, is the leading producer of live pop-culture multimedia conventions across North America. The company will host 16 Comic-Con conventions in 2014, with overall attendance expected of at least 350,000 to 400,000 people this year, and with a much broader schedule planned for 2015. These conventions bring avid fanboy and fangirl communities together to celebrate their favorite films, TV shows, celebrities, video games, technology, toys, social networking, gaming platforms, comic books and graphic novels. Importantly, with an active database of over 1 million followers that we can market the channel to, Comic-Con's fans are rabid entertainment enthusiasts, collectors and technology savants, ideally positioned to support a Comic-Con-focused digital network. They are also a prime demographic target for advertisers.

The channel will launch by the fall of 2014 and include films, TV episodes and web-originated programming targeted to 18 to 44-year-old consumers, including titles from Cinedigm's nearly 2,000-episode anime library and other key Comic-Con-oriented properties. Wizard World has already started capturing top panels and talent from Comic-Cons nationwide to premiere on the network, and we will continue filming at upcoming Comic-Cons throughout the winter and spring. The multiple monetization opportunities for this channel are tremendous. We will be offering advertising-supported streaming, as well as a premium subscription option. We also plan to feature merchandising and home shopping.

In other digital network news, Cinedigm's first digital channel, Docurama, which was soft launched as part of YouTube's subscription channel initiative in summer 2013, and is currently available on Roku, xBox and Samsung, has already been downloaded more than 140,000 times, without the support of any consumer-directed marketing efforts. We will roll out Docurama, which leverages our documentary library of more than 1,300 titles, to additional platforms, including Apple and Android in April 2014, at which point, we will officially launch the channel to consumers.

We presented both the Docurama channel and the Comic-Con channel concept at the Consumer Electronics Show this year to help enlist additional sponsors to further drive growth. The reaction to these channels has been enormously positive. And as a reminder of the potential upside value-creation opportunity in this space, the Chernin Group invested $100 million last fall for 60% of the single narrowcast digital anime channel, Crunchyroll.

On the theatrical distribution front, we've also been very busy. First, our critically acclaimed film Short Term 12 won the Golden Tomato Award from leading review aggregator Rotten Tomatoes as the Best Reviewed Limited Release Film of 2013. During the quarter, we also released 3 movies and have 6 films in our upcoming release slate, including Kelly Reichardt's Night Moves, starring Jesse Eisenberg and Dakota Fanning. And earlier this week, we announced that in partnership with Drafthouse Films, we're bringing the comic thriller Cheap Thrills, exclusively on-demand, to Time Warner Cable, Comcast, Cox Communications and Bright House Networks, beginning February 21, prior to its March 21 national theatrical release. All of these key cable systems are heavily promoting the title.

In summary, together with our digital cinema business, which continues to generate strong recurring revenues, Cinedigm is uniquely positioned as a powerhouse in the independent content distribution business, with every digital and physical platform, theater chain, retailer and supplier. Having successfully integrated 2 accretive acquisitions in New Video and GVE in the last 24 months, we also remain disciplined and on the lookout for accretive strategic acquisitions that can further accelerate our growth plans. We are a public digital entertainment company in a dynamic industry and are now perceived as an innovative leader that does not have to play by the tired old rules of the traditional media companies. So we are now increasingly on the shortlist to review a variety of superior opportunities that were not available to us previously.

And now, Adam will review our financials.

Adam M. Mizel

Thank you, Chris. I will begin with a review of our financial results of the third fiscal quarter, and will then discuss our outlook for the balance of fiscal 2014. Please note that all comparisons referenced in my prepared remarks reflect quarterly year-over-year comparisons, unless I clarify otherwise.

Consolidated revenues increased 60% to $34.9 million in the third quarter, and non-deployment revenues also increased 146% to $22.2 million, reflecting the positive impact of the October 21, 2013, acquisition of GVE. Cinedigm Entertainment Group revenues increased 234% to $18.8 million due to organic growth as well as the positive impact from $10.9 million of revenues earned by GVE in the 9.5 weeks post the closing of the acquisition. In addition, GVE generated for its previous owner approximately $2.2 million of revenues in October, prior to the acquisition closing.

Consolidated adjusted EBITDA in the third quarter was $17.8 million, an increase of $2.6 million versus the prior year quarter of $15.2 million. Adjusted EBITDA from non-deployment businesses more than doubled to $5.7 million, increasing from $2.8 million in the prior year quarter. We incurred $400,000 of J-curve releasing costs in the fiscal third quarter and $2.6 million net J-curve releasing costs in the fiscal year-to-date. In addition, GVE earned approximately $1 million of EBITDA for its previous owner in October, prior to the closing of our acquisition.

Our fiscal third quarter was impacted by a combination of the sluggish retail holiday shopping environment experienced by our customers, and as Chris mentioned earlier, an expected reduction in our new release slate, as the GVE corporate sale process limited new app content acquisition activity by GVE during 2013. As a result, GVE had 50% fewer new release titles in Q3 as compared to GVE's releases in the same period last year. We expected this reduction and successfully focused during the quarter on several library and digital licensing transactions to drive our results and support the expansion of our new business pipeline.

We closed a significant transaction in December and collected the nonrefundable revenues in January, as per the contractual terms. Though I would like to provide more detail, the confidentiality clauses of our contracts and the strict privacy concerns of all of our major customers, prevent us from disclosing more detailed information. However, we recently concluded that even though we have absolutely no ongoing performance obligations in this contract, this revenue must be recognized over the multiyear term of the contract, rather than be recognized immediately, as we had assumed in our recent forecast. We are now expecting a minimum of approximately $1 million in additional EBITDA per year from this deal over the next 4 years. As I will discuss in a moment, clearly, this timing variance is the key driver in our reduced guidance.

Our Digital Cinema business continued to be a stable and strong base of recurring revenues that supports our underlying cash flow and debt amortization. Even with the impact of a modestly reduced major studio release total this year and a pattern of compacted release timing around major summer and holiday weekends, results were solid in Digital Cinema. Cinedigm continue to aggressively strengthen our balance sheet, as we paid down over $10 million of non-recourse debt in the quarter and almost $32 million year-to-date.

Looking ahead, the company expects to produce solid financial results, as we leverage our leading market position to drive new business growth in sales in both our home entertainment releasing business and our digital networks. However, as I mentioned earlier, the company has adjusted its fiscal fourth quarter guidance and second half guidance to reflect the impact of the revenue recognition timing we have already discussed.

Fourth quarter non-deployment EBITDA is expected to be $5.8 million to $7.3 million and total consolidated fourth quarter EBITDA is expected to be $17 million to $18.5 million. Second half non-deployment EBITDA is expected to be $12.5 million to $14 million versus $17 million to $18 million, previously discussed. And consolidated EBITDA is expected to be $35.8 million to $37.3 million versus the previous guidance of $41 million to $42 million. We expect fourth quarter non-deployment revenues of $22.5 million to $24.5 million and total consolidated revenues of $35 million to $37 million. As noted previously, our previous and current guidance includes $2.2 million in revenues and approximately $1 million of EBITDA recognized by GVE's prior owner in the October 1 through October 21, 2013, time period.

Finally, after filing our 10-Q, the company intends before the end of the month to replace its most recent shelf registration, which was utilized in supporting both the New Video Group and GVE acquisitions, with a new $100 million shelf. As is common with most public companies of our size, the shelf is a normal course of business filing, and it has been our policy for almost 2 years to have a shelf outstanding. As Chris mentioned earlier, a disciplined approach to accretive M&A and growth initiatives outside of our normal operating plan will continue to be an opportunistic component of our strategy, and we need to be prepared with the most efficient forms of financing if such opportunities emerge.

As a reminder, management and the board currently own in excess of 25% of Cinedigm's outstanding equity securities, including options and warrants, so you can be certain that as a group and as we have demonstrated in the past, we are very sensitive to potential dilution and fully align with our shareholders' interest.

I'll now turn the call back to Chris for closing comments.

Christopher J. McGurk

Thanks, Adam. Cinedigm has a long history of being a pioneer. Initially, as a first mover in the digital cinema rollout, then as a first mover in digital content distribution, and now, as a first mover in the rapidly evolving digital network business, where we are beginning to leverage our unique assets to stake our claim as a narrowcasting version of Netflix, Hulu or Amazon. We're excited by our recent progress as well as our future prospects. We thank you for your time and attention today and look forward to sharing our continued progress on next quarter's call.

And with that, we're happy to answer any questions you might have.

Question-and-Answer Session

Operator

[Operator Instructions] Our first question comes from the line of Eric Wold from B. Riley.

Eric C. Wold - B. Riley Caris, Research Division

A couple questions. I guess, one, Adam, first of all, I know you can't talk too much about the major deal that was signed that caused -- or the revenue recognition issue that caused the fourth quarter guidance to be reduced. Do you have a sense, though, of how much of the reduction in the fourth quarter guidance stemmed from that one issue versus, possibly, something else?

Adam M. Mizel

Pretty much all of it.

Eric C. Wold - B. Riley Caris, Research Division

Okay. And then that will be recognized over 4 years versus your previous thought was all in the fourth quarter?

Adam M. Mizel

Correct.

Eric C. Wold - B. Riley Caris, Research Division

Okay. And then besides that, can you maybe give a sense, now that we're 4 months or so since the acquisition took place, maybe give a sense of the performance of the underlying titles, library, of the stuff that did hit market versus kind of what you thought they'd do as you went into the deal? Just trying to get a sense of the baseline business that you took over at the time and kind of how that performed during the fourth quarter or the third quarter, and maybe so far into the fourth quarter?

Adam M. Mizel

Yes, overall, as I said in the comments, I think the fiscal third quarter physical sales results were a little light across the board and I think reflective of foot traffic and all the issues that all of the retailers talked about in excruciating detail. I mean, we had more facings than previous years and so produced sales close to in line as what we expected on a per-title basis. There were just less titles and a little less traffic. And I think things, we see a little bit -- we're a little more optimistic about this quarter, in particular, because we had a very good Super Bowl matchup. And we think there's a lot of -- we're seeing a lot of demand for the Seahawks DVD. And that's going to translate this quarter into bigger orders than we had budgeted, than we saw last year. So I mean it's the movement around, but I think we have not been surprised by anything significant in the performance of the existing titles.

Eric C. Wold - B. Riley Caris, Research Division

Okay. And just one quick follow-up on the, not the previous question, but with the major deal you had signed. I'm not sure how much expenses there are associated with the revenue that would have been recognized in Q4, but the -- are the expenses ratable over the 4 years as well, if there are any, or are all the expenses hitting in this fourth quarter and -- but just the revenues will be hitting over 4 years?

Adam M. Mizel

It's pretty matched up, and as I said, we expect $1 million of EBITDA per year for the next 4 years from that deal, so that'll be net of everything.

Eric C. Wold - B. Riley Caris, Research Division

Okay. And then last question, on the channel launches, with the new one around Comic-Con. Give a sense of, including that and Docurama, how many, you expect, channels to possibly be in place by the end of this coming fiscal year, your fiscal '15, as well as maybe the one after that. And maybe you can give a sense of general launch costs to get one ready to be launched. I know it'll vary by genre, but maybe just a general sense of the launch cost?

Christopher J. McGurk

Well, this is Chris, Eric, and thanks for the question. I mean, you can count on the 2, Docurama being launched direct to consumers in the spring, and then we're targeting the Comic-Con channel by the fourth quarter this year. There could be as many as 2 more. So I would say 2 to 4 channels in the next, say, 12 months. But the launch costs, again, and I tried to hit on this in my remarks, are actually pretty de minimis, because the big gating factor and the big cost is content. And we control enough content already to basically program these channels in a more powerful way than a lot of the other narrowcast channels that exist out there. I'm going to give you a for instance, I use Crunchyroll as an example. That's an all-anime channel that Chernin paid $100 million for 60% of. We've got 2,000 episodes of anime in our library alone, which I think is a big, big percentage of their on-air offering. So in controlling -- the content is the biggest gating factor and the biggest cost, and we already control a ton of it. And in the case -- same thing with the Docurama channel, where we have 1,300 titles in our library. So you're looking at a launch cost in the first 12 months of these channels that's probably about the cost of us acquiring and releasing an independent film, so it's not multimillions of dollars. It's, at the most, a couple of million dollars, and probably less than that. And that's why we love the risk-reward profile of these channels so much, Eric.

Adam M. Mizel

Yes. As Chris said, I think, we -- and we've talked in the past, we will -- we have third-party technology partners for a lot of the platform technologies that we're able to license on a marginal-cost basis, and we do a lot of customization on user interface and experience. And then the 2 main costs, a, content acquisition, which we have a lot of in our library and when we acquire more, it's part of the ordinary course of monetizing it in multiple streams and channels, so we're not looking at content costs for one over-the-top channel. We're looking at how we're selling DVDs, how we're licensing that to Netflix and putting it on Apple and making revenues, and this is another revenue source. And the third piece is always customer acquisition. And an example, as we talked about with Comic-Con channel -- one of the reasons we have partners, and we like partners -- branded partners, is that they bring...

Christopher J. McGurk

Audiences.

Adam M. Mizel

Bring an audience and effectively reduce our cost of acquisition, so I think -- and we'll be able to secure sponsors and other revenue streams pretty quickly. I think, we think we've got a model here that drives a lot of value quickly, gets a lot of recurring subscription revenue and advertising DOD revenue pretty quickly and gives us a differentiated distribution component to our business, which then flows back into any conversations we have in acquiring movies or acquiring new distribution relationships, where we're able to sit down with that content owner or company and say, we can do everything that the industry does and generally, lower cost and better. And by the way, we do things here that no one else does, and that's going to create more value for your content.

Christopher J. McGurk

Right.

Adam M. Mizel

That's how we differentiate ourselves and drive more value.

Christopher J. McGurk

And just to put one more point on it. One of the things that we absolutely love about the Comic-Con idea is that what these Comic-Con consumers want, they want to be inside a Comic-Con. If they live in a market where Comic-Con is hundreds of miles away, and so we can create a lot of high-impact content, exactly what the Comic-Con audience wants to see, by simply having some, a camera crew, basically, walk through a Comic-Con convention, and film panels and interviews with the talent that they have, and that kind of thing. So we can create, literally, hours and hours and hours of high-impact original programming at pennies on the dollar of what it would cost to create original series and things like that. So we think that they're a perfect partner for the launch of our first big major channel.

Eric C. Wold - B. Riley Caris, Research Division

And I apologize. I'm not -- not to harp on this, but just back to the one -- the major deal. So is the $1 million being recognized in this fiscal year or just 1/4 of a million dollars, because it's 1 quarter, and then it's $1 million per year going forward?

Adam M. Mizel

The latter.

Operator

Our next question comes from the line of Andrew D'Silva from Merriman Capital.

Brian Murphy

It's Brian Murphy filling in for Andrew. Most of my questions have been answered, but I just wanted to kind of follow up on a previous question. And you guys talked a little bit about the short list of digital channel opportunities you have in the pipeline. Can you talk a little bit more just about the scope of the opportunities that you guys are looking at right now, and maybe how you go about evaluating those?

Adam M. Mizel

Not sure what you mean by the scope of the opportunities?

Brian Murphy

Like, not sure how many of these opportunities you have in the pipeline right now, just sort of addressable opportunities. How you guys are thinking about that?

Christopher J. McGurk

Yes, I mean, we have more opportunities than we could potentially launch. And our goal is to try to figure out how to launch these channels in the smartest way possible, with the right partners that can ensure we're launching this with the right risk profile, and we have the biggest chance of success. As Adam mentioned, a really important component as we're trying to sort through and figure out which channels have the highest probability of success is can we find a partner that brings a number of things to the table. An important thing, as Adam mentioned, do they bring a ready-made avid audience for a particular type of content? That was clearly the case with Comic-Con. And do they have access to that audience in a very, very efficient way? So we're kind of using that as a screening factor, as we evaluate other opportunities and match potential partners up with our library, with the components of our library that we can throw against that audience. So that's sort of the thought process that we're going through right now. And as we said, we probably considered 20 or 25 different ideas. But as I mentioned in response to Eric's question, probably in the next 12 months, at most, we'll have 4 channels launched and announced. And you can count on the 2 that we've already identified.

Adam M. Mizel

And we're focused to -- we also need to make them succeed. So it's not a race to have lots of announcements, it's a race to find the right couple and put significant resources and energy behind them and their success. And so we -- there will be some more things we do, but we're going to make them work and make them work really well, because that's the big opportunity.

Christopher J. McGurk

So look upon Comic-Con and everything we described as sort of a model of what we're going to -- we found a branded partner that has access to a huge audience and knows exactly what that audience wants, that can augment all of the library that we're going to put on the channel with cheap, high-impact -- not cheap -- low-cost, high-impact original programming and can curate that programming, help us curate it for that audience and has an advertising-rich targeted demographic. So those are sort of the parameters that we're going to apply against each one of the channel opportunities going forward.

Operator

Our next question comes from the line of Kris Tuttle from SoundView Technology Group.

Kris Tuttle - SoundView Research

Obviously, we're all very interested in the narrowcast opportunity you have. And I wanted to get a sense of how you're thinking about it in terms of size. So if you just sort of think out, let's call it, 24, 36 months, what percentage of your non-deployment revenue do you think would -- if you're successful, would be represented of these specialized narrowcast channels?

Adam M. Mizel

I think, Kris, that's a tough question to answer, because there's a lot of speculation in that. I think you hear us -- and we have been, over the last number of months, very focused on this as the -- a differentiated opportunity to drive a lot of value in our library and in our business. Everything that we're-- and it supports everything we do. As I said earlier, successful channels give us a differentiated distribution capability that we own, that we can then use as a differentiator in acquiring content which we monetize across multiple streams. And so there are just so many variables, but I think when we think about our business, we talk about their -- And I do this, and when I'm -- and Chris does this when we're making our investor presentation -- we talk about 4 legs on the stool of what we're doing, our home entertainment distribution business, and we're going to continue to add customers like the WWE and the NFL and Shell Factory and et cetera. We think about our new acquisition and releasing business theatrically and into the home markets, so we're going to continue to be acquiring movies. We talked about we have 6 more coming and a number of discussions from new acquisitions in the pipeline, our channels. And then as Chris talked about, where appropriate and opportunistic, disciplined strategic M&A. And all of those will drive our business forward and create significant growth. And the combination and the timing in all those, and they all fit each other, and where and how you drive it, it's too hard to speculate a few years out. But I think what we're telling you is the channel business today, obviously, doesn't contribute any revenues, and we think it's one of the main core businesses of the business over the next 24 to 36 months, so it's going to grow to be a big piece of that.

Kris Tuttle - SoundView Research

Right. I mean, I know it's impossible to guide something like that and hard to take a stab at. I was just curious, if it's one of the legs of the stool, does that mean it's maybe 5% to 10%? Is that kind of how you think about it? I'm just kind of, and since you're a little closer to it, I just figured you might have a, maybe a swag?

Adam M. Mizel

I just want to be very...

Christopher J. McGurk

We, no, we shouldn't be swagging. That's a term of art, so...

Kris Tuttle - SoundView Research

All right, that's fair. I mean, I think, there's some industry data out there that I'm sure is applicable. But it's, obviously, it's an exciting strategy there everybody is excited about.

Operator

[Operator Instructions] Our next question comes from the line of Paul Gordon, private investor.

Unknown Attendee

A couple of questions. The movie Short Term 12, was that produced in-house or was it [indiscernible] at some film festival? And what was the company's exposure to it? And was it profitable?

Adam M. Mizel

We acquired Short Term 12 as we do all of the movies we release. We acquired that one at South by Southwest last year. And we do not produce and create new movies in-house. And we don't disclose the cost of acquiring movies and what we invest. We generally say -- have said in the past is that we think our investments in both acquisition and marketing costs on any single release has typically not been much above $1 million at most per picture and sometimes a lot less than that. In Short Term 12's case, we got a partner, so we collectively met our financial investment goals with the partner doing the other piece of it. And that movie, we expect to be profitable and has it performed as we would've hoped? So far. I mean, it's only 6 or 8 months into our first 5-year ultimate cycle, and it's performing as we would've hoped.

Unknown Attendee

And the movie with Jesse Eisenberg and Dakota Fanning, when does that get released?

Adam M. Mizel

Sorry, your line is completely breaking up.

Unknown Attendee

You have a movie coming out with Jesse Eisenberg and Dakota Fanning, when does that get released?

Adam M. Mizel

I think we're targeting a May release for that movie.

Unknown Attendee

Okay, and then another question, with the Comic-Con channel, which looks promising, any chance of getting a tie-in with the Big Bang Theory? Wouldn't that be good exposure, or could that happen?

Adam M. Mizel

I mean, I think there are a lot of opportunities and one of the exciting things is all of the talent that goes to these conventions, speaking to their fans. We've talked to a lot of people already who are in that talent community, who are really excited about participating in the channel and helping see it succeed. It's a new way for them to connect with their fans and a new economic opportunity. So there's going to be a lot of those potential ways to create value in that channel.

Operator

This does conclude the question-and-answer session of today's program. I'd like to hand the program back for any further remarks.

Christopher J. McGurk

Okay, just very briefly, we think it's a very exciting time here, and we thank you all for your continued interest and support, and we look forward to talking to you again very soon. So thank you, all.

Operator

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program, you may now disconnect. Good day.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!