Q3 2021 Dolphin Entertainment Inc Earnings Call
[music].
Good afternoon, ladies and gentlemen, and welcome to the Dolphin Entertainment third quarter 2021 earnings call. At this time, all participants have been placed on a listen only mode and we will open the floor for your questions and comments after the presentation.
My pleasure to turn the floor over to your host James Carbonara, Sir the floor is yours.
Thank you and once again welcome to Dolphin Entertainment's third quarter 2021 earnings call with me on the call are below doubt Chief Executive officer, and merits integrating chief financial Officer.
To begin the call by reading the Safe Harbor statement.
This statement is made pursuant to the Safe Harbor statement for forward looking statements described in the private Securities Litigation Reform Act of 1995.
Statements made on this call with the exception of historical facts may be considered forward looking statements within section 27 of Securities Act of 1933 and section 21 E of the screens Exchange Act of 1934, although the company believes that expectations and assumptions reflected in these forward looking statements.
Simple it makes no assurances that such expectations will prove to be incorrect actual results may differ materially from those expressed or implied in the forward looking statements due to various risks and uncertainties.
For a discussion of such risk factors, and uncertainties, which could cause actual results to differ from those expressed or implied in the forward looking statements. Please see risk factors detailed in the company's annual report on Form 10-K contained in subsequent filed reports on Form 10-Q as well as in other reports that the company files from time to time with the securities and exchange can.
Any forward looking statements included in this earnings call are made only as of the date of this call. We do not undertake any obligation to update or supplement any forward looking statements to reflect subsequent knowledge events or circumstances.
Now I would like to turn the call over to below doubt Chief Executive Officer of Dolphin Entertainment Bill. Please proceed.
Thanks, James and Hi, everyone. Good afternoon, and thank you for joining us today.
Always we will start with a review of some financial and operating highlights.
I would buy a full financial review and then open it up for Q&A.
So from a financial highlights perspective, the momentum from the first half of the year carried through to the third quarter looking at the P&L. We have set another new record with $9 4 million in revenue up.
Up 70% year over year, with an absolutely fantastic, 41% year over year organic growth from existing subsidiaries.
Note that this follows Q2, which set a record of $8 6 million in revenues, which filed with Q1, which itself had a set a record of $7 2 million in revenues.
Next looking at our operating income, which is the metric by which we gauge ourselves it's positive for the second consecutive quarter, even when including the non cash expenses of depreciation and amortization.
To reiterate positive operating income from a Microcap entertainment company, even including the DNA expense from our acquisitions.
What's also nice is that we are EBITDA positive through the first nine months of the year, even while investing in our two <unk> initiatives.
Okay, let's turn to the balance sheet, we have a record cash position of $12 7 million, which is an increase of 60% compared to December 31 2020.
Also we now have significantly more cash than all that combined including long term debt.
Furthermore, let's look at our working capital after reaching a peak working capital deficit at the end of 2019 of just under $16 million as we borrow to pursue our acquisition strategy to build our super groups.
We're now reporting.
A working capital surplus standing at $4 5 million, which is more than triple the working capital surplus as of June 30.
And of course since we're a cash positive company, we expect the surplus will only continue to grow.
Thus our balance sheet today less than two years removed from our peak working capital deficit.
Only be fairly described as possibly our biggest strength when compared to our micro cap peers.
I'd like to reiterate the reason this is so important to us is because that working capital surplus gives us the muscle on our balance sheet for the next set of acquisitions and two <unk> investments.
For acquisitions on the same terms of any of the six we've already done for example, we will be able to pay the cash component for any of them from cash currently on our balance sheet.
Furthermore, we have not needed to borrow money or do a drawdown on our S. Three to fund the development of our NSE business.
Short this perfectly illustrates the better mousetrap, we feel we've built with dolphin.
Our growing cash positive core business and dolphin, one pointed out that is capable of self funding. The majority of investments in development cost of the big potential upside opportunities of dolphin two points.
Now, let's move to some operational updates on our Super group the companies that are making those great numbers happen.
Let's start with short fire media Dolphins industry, leading music PR firm, which is having an absolutely terrific year.
Sure fire helped to concert.
This relaunch by Publicising 40 quarters year to date from artist in all genres.
<unk> largest festival in Milwaukee summer fast and the reopening of nationally recognized venues, including New York's legendary Blue Note and the award winning Brooklyn Bowl Nashville.
<unk> hired client actually Kidjo was named one of times 100, most influential people Carole King and Todd Rundgren more inducted into the rock and roll Hall of Fame and <unk>.
Lastly, Chris Bosh was inducted into the NBA Naismith Hall of Fame.
Sure fires corporate clients, including North America's leading livestream shopping platform network Tech focused digital fan engagement company mandolin and reservations technology platform light have won best in Klas Awards recently in a SaaS company.
Forbes AD age Adweek and rolling stone, thanks to shore Fire's efforts.
Okay, how about 42 us Dolphins entertainment PR powerhouse.
While speaking of September that Japanese months and.
<unk> 42 us extraordinary range of work for programs in individuals'.
Put their clients and positioned to receive a total of 19 Emmy nominations just to highlight a couple.
Companies work on Amazon series, the boys led to multiple nominations, including for outstanding drama series.
Also as a result of 42 US campaign efforts the acclaimed music documentary Billy I wish the world's a little blurry earned a total of four nominations.
Turning to BHI the division of 40 to us with a particular focus on entertainment consumer products and gaming.
BHI was engaged by fandom, the world's largest stand platform. Our number one source for in depth information on pop culture Entertainment and gaming to execute comprehensive publicity efforts for increased brand awareness and overall business growth for.
For contacts fandom is an entertainment and gaming juggernaut.
More than 315 million unique visitors each month.
<unk> 250000 fan power communities with 30 million pages of content to get 30 billion page views per year.
Moving along to be social Dolphins Influencer marketing group.
The social losses showroom concept hosting a two day summer showroom in West Hollywood.
Participating brands included Bondi Sands high by direct meet the label and Pizza, Italy.
Many others with key creators in the beauty fashion and lifestyle spaces in attendance.
Those who follow our company closely know that I'm, a big fan of this initiative.
I've been asked how the Influencer showrooms work.
<unk> modeled the showroom concept is pretty simple brands pay a fee to be included in the showroom and work with the social on selecting products that are carefully tailored towards the influencers attending.
From there be social handles all event production in addition to spearheading influencer outreach.
The social uses their own in house roster of talent along with their teams longstanding influencer relationships to drive traffic to the event.
Influencers are gifted the products from each participating brand during the event and then be social monitors all social coverage secured from the event for a full month.
Each brand a tailored report outlining all social placement secured for their products as a result of the event.
Hopefully that helps provide context for the showroom concept.
We intend to scale in 2022.
Next up viewpoint creative Dolphins respected.
Creative Relations agency and video production boutique.
Viewpoint joined forces with the Leary firefighters foundation to create and distribute content commemorating 911, and the 20 years since the attacks.
Then attribute to the heroes, who felt that day the content recognized legacy firefighters.
The struggle with the fallout and how the fdny as improved systems and processes based on the events of 911.
We're always very proud and willing to highlight this type of work that viewpoint dose.
And last but not least let's talk about the door are leading culinary hospitality and lifestyle PR firm.
The integrated marketing division at the door is doing great work for their consumer products clients and the culinary and hospitality teams are fresh off promoting the New York City wine and food Festival last month.
But truth be told I saved the door for last in order to allow them to serve as a bridge into dolphin to point out since Charlie Lois on the entire door team.
An essential part in both of the two point our initiatives, we're going to talk about today.
So let's go let's talk about dolphin to point out.
As a reminder for anyone new on the call or to the Dolphin story, we define the work of our Super group under Dolphin. One point out is the very best marketing pop culture.
And we define what we call it off and to point out is using pop culture to market assets that we own.
What type of assets do we want to own easy ones, where our expertise in marketing gives us the greatest likelihood of success, we want to own what we know we can market better than anybody else.
That's why last month, we announced a major dolphin to point out initiatives the acquisition of an ownership stake in midnight theater.
Contemporary variety theater, and restaurants that will anchor the $4 5 billion development from Brookfield known as Manhattan West.
It's across ninth Avenue for Moynihan station to the east and across 10th Avenue from Hudson yards to the west.
And only a short walk from the Javits Center.
New York's preeminent convention facility.
We feel the midnight theaters being built and the very best location in Manhattan.
Okay. So let's talk about the venue.
The Midnight Theatre features three distinct experiences for the guests the theatre itself.
Separate Pan Asian restaurant called hidden leaf and.
In a ground level cafe, let.
Let's take the variety theater <unk>.
It's an intimate luxury state of the art 160, <unk> theater, which is the name implies we will have a rotating schedule of a wide variety of performances across music <unk>.
Harmony Broadway and magic shows.
Midnight Theater also has built in live streaming capabilities, allowing for events inside the theater to expand beyond into People's homes and corporate offices.
Theater will be available at host livestream podcasts comedy specials music events corporate keynote events and more.
Didn't leaf is the modern Pan Asian restaurant concept on the second floor of the midnight theater space led by renowned restaurant's her Josh Cohen.
Many of you know several Josh as Brooklyn hotspots, including the Italian mainstay Lilly is one of the most in demand restaurants in all of New York City.
As of Midnight theater.
Hidden leaf will feature a 75 seat dining room 20 seat private dining room, and a 46 lounge bar area.
Hidden leaf will be open for lunch and dinner.
We'll incorporate world class food with interactive elements, such as Tableside prep wind consignments.
And memberships.
And the bars.
Where youll be able to find James Carbonara every Tuesday, Wednesday, Thursday, and Friday nights.
For Dolphin midnight theaters, the most exciting live venue concept, we have seen in a very long time.
It will be a truly modern variety theatre paired with fantastic restaurants.
Which is a combination that is missing in the cultural landscape today.
In the final stages of construction and we expect to open by the end of the first quarter of next year Dolphin will manage all aspects of publicity and marketing for the venue, both restaurant and theater as well as facilitate talent and commercial relationships within both the entertainment and culinary industries.
As we look to own assets, where in our specific marketing expertise will give us a greater likelihood of success.
It is hard to imagine anything more in our wheelhouse.
The World class restaurant for the door to publicize paired with a state of the art variety Theatre that will program musical performances Broadway cabarets comedy acts of Magic shows.
All of which shorten fire 40 to us currently promote.
And of course, we'll be sure to be social bring a steady stream of influencers as our guests and post about the great time they had afterwards.
Playing dolphins marketing strengths as with Dolphin to point out is all about.
Which is also why we launched our <unk> business in 2021.
I know many of you saw our big announcement this morning.
Before we talk about that specifically I would like to take us back through the two key milestones in the past three months that positioned us to make today possible.
First our partnership with MTX use, which we announced in August.
For any of that need reminding <unk> is a leading crypto currency exchange and wallet provider with over 1 million active users and over $10 billion of average trading volume per day.
With access to <unk> platform and wallet services, we can now aggressively pursue our ambition to develop a program global NFC collections targeting all of Dolphins verticals, including the sports film television music gaming esports culinary lifestyle and charity.
<unk>.
With the.
Nickel development well underway. We then turned our attention to the creative side of the coin and brought in award winning visual designer Anthony Francisco, a few weeks ago and the newly created post of creative director to develop and execute numerous NFC series involving original and existing IP.
Anthony came to us from Marvel Studios, where he was the senior visual development artists responsible for designing iconic characters across the Marvel cinematic universe.
Such as baby Groot.
Personal favorite of many of the Dolphins loci door in Malaga female warriors and Black Panther.
In short.
We feel we won the lottery for NFC business by securing <unk>, our technical partner and by bringing in Anthony Francisco as our creatively.
And together that is what enabled us this morning to announce the launch of creature chronicles exiled aliens Dolphins first generative NFC collection.
Which will feature 10000 unique custom crafted avatars of an ancient race of aliens designed by Anthony Francisco.
Each <unk> alien Avatar will fall into a specific dalian hierarchy assigned trades and randomly generated the collection.
It is available for viewing today right now.
<unk> chronicles dot Io and is slated for minting in December.
Now, we intend increase or chronicle to be a multi season NFC event. After the release of exiled aliens the community and fan experiences will continue to evolve and grow while the storyline develops new NFC drops are released during upcoming seasons.
Dolphin will ensure that <unk> community members will enjoy a wide range of benefits, including limited edition entities Master classes with Anthony Francisco and friends creative competitions with incredible prizes.
Private events and future surprises.
All leveraging dolphins world class relationships across the creative community.
Furthermore, holders of exiled aliens avatars will receive priority status for the purchase of future seasons of creature chronicles.
We are pricing each textile to alien at $200, which includes both the NFC avatar and inclusion into the ongoing creature chronicles community with all the benefits I just mentioned.
Users can purchase exiled allianz directly on site.
Simple registration process, which establishes a proprietary <unk> wallet for each user.
<unk> wallet allows for payments to be made via credit and debit cards as well as a wide variety of crypto currencies, including soul ether in bitcoin.
The entities will be minted and stored on the so a lot of blockchain, a leading proof of steak blockchain that is recognized its faster more efficient lower cost and more environmentally friendly than it's proof of work competitors, notably a theory.
So there it is all of US at Dolphin are really excited to this day would come when.
When we can share our very first NFC collection designed to launch our first community.
We're obviously playing to the strengths of Anthony and he has delivered the graphic art within the exiled aliens collections, absolutely breathtaking and no offense to the aliens, but we don't believe theres, a better visual artists and our shared universe then Anthony.
We think this collection will appeal to the existing NFC enthusiasts, while also serving as an entry point to those who are curious about entities.
And want to dip their toe in with something really cool from a world class designer.
And quite frankly, we're excited to program for the community, which will allow us to play to our strengths and offer benefits and access to the worlds of entertainment and pop culture that are simply unique in the marketplace today.
To fund a midnight theater next out aliens and one conversation.
We're extremely pleased with these first two dolphin to point out initiatives and hopefully today's conversation shared some context to why they were chosen to lead off into this new era of ownership of assets that we're marketing.
Any dolphin to no opportunity as judged by its ability in success to serve as a major catalyst for our company.
We feel these first two certainly have tremendous growth potential with midnight theaters possibility to expand into other cities and with our plan to launch out of tea collections across all the industries at Dolphin companies currently market.
By the time, we jump on the earnings call for our 10-K, we would hope to have midnight theater open and everyone. On this call scheduling their first visit in one or two more NFC collections launched and community activities for all of them well underway.
And we're not stopping we are more two <unk> initiatives in the final stages of closing that we anticipate announcing before the end of the year.
Dolphin flywheel is turning and momentum is helping us to gain speed.
We feel that our marketing companies are the very best in their respective industries quite frankly, I think thats almost impossible to argue.
And there is no shortage of attractive partners and opportunities for us. The two point our pipeline is strong for NFC and non NFC opportunities alike, and we will pursue those first that we believe will create the most shareholder value.
In closing I would like to remind everyone that these two investments are on top of a growing one point out business that.
That has led to record revenues for three quarters in a row, including 70% year over year revenue growth here in the third quarter.
Two consecutive quarters of positive positive operating income even after the noncash expenses of depreciation and amortization from our acquisitions.
And a record level of cash on hand over $12 million in fact, which is approximately $3 million more than all remaining debt combined including the long term debt.
We are profitable and growing with a beautiful balance sheet and now we are launching dolphin to point out in earnest.
These are the days that we've been dreaming of since we uplifted to NASDAQ almost four years ago and began assembling the Super group.
Thank you for joining us to that and I will now turn it over to Mary.
Thank you Bill and good afternoon, everyone.
Now discuss results for the quarter ended September 32021.
Revenue for the quarter ended September 32021 was approximately $9 $4 million compared to approximately $5 5 million in the quarter ended September 32020.
Operating expenses for the third quarter of 2021 were approximately $9 4 million compared.
Compared to approximately $6 million in the quarter and into <unk>.
Third quarter of 2020.
Operating expenses are comprised of direct comp payroll and benefit selling general and administrative costs, depreciation and amortization and legal and professional fees.
For the third quarter of 2021 were approximately $992000 compared to approximately $575000 in the same period in the prior year.
Payroll costs were approximately $5 $9 million in the third quarter of 2021 as compared to approximately $3 $6 million in the third quarter of 2020.
Selling general and administrative expenses for the third quarter of 2021.
And that would be one $5 million compared to approximately $950000 in the third.
Third quarter of 2020.
Legal and professional fees of approximately $499000 in the third quarter of 2021 compared to approximately 373000 in the third quarter at 2020.
Operating income for the quarter ended September 32021 of approximately $38000 included noncash items from depreciation and amortization.
$475000 as compared to an operating loss of approximately $493000, which included noncash items from depreciation and amortization of approximately $514000 for the same period in the prior year.
Net income for the quarter ended September 32021 with approximately $142000.
Parents, one net loss of approximately $138000 for the quarter ended September 32020.
For the three months ended September 32021, we had basic and fully diluted earnings per share of two cents per share based on $70 million 740085 weighted average shares outstanding.
For the three months ended September 32020, we had basic loss per share of <unk> per share based on $6 million 676405 weighted average shares and fully diluted loss per share of four cents per share based on 6.912 million 11.
Weighted average shares outstanding.
Cash and cash equivalents were $12 7 million as of September 32021, compared to $7 $9 million as of December 31st 2020, not including restricted cash of approximately $542000 and $714000 in each period.
Got it.
That concludes my financial remarks, I will now ask the operator to open the phone line for Q&A. Operator can you. Please poll for questions.
Absolutely. Thank you ladies and gentlemen, the floor is now open for questions. If you have any questions or comments. Please press star one on your Touchtone phone pressing star to remove you from the queue should your question to be answered and lastly, we are posing your question. Please pick up your handset if was listening on speaker phone to provide optimum sound quality.
Please hold while we poll for questions.
Okay. Your first question is coming from Alan Klee.
From Maxim Group your line is live.
Good afternoon, congratulations on a strong quarter.
I wanted to start off with the N F tease it really seems like you've.
You've put a business together now of that this could have.
Have an impact mix next year.
Hi.
How do you think about kind of.
Is there a way to think about like how how the opportunities here. Thank you.
Sure. So thank you all and thanks for the kind words yet.
We are thrilled with the progress I'm, even since Q2 on the numbers.
She is getting stronger.
NFC is yeah, it's an exciting business I think we really wanted this announcement before we did our earnings call.
I'll talk about and let people go check out some EMS up them and they're today to see.
What we've been building with on the technological side with SPX to allow us to sell directly on our own sites.
Each branded sites, if you will and be able to take credit cards.
As well as every form of crypto not just the.
The single form on the blockchain that we're using.
We're thrilled that it's so lana.
Thanks, Falana has so many advantages in his speech.
Speed and environmentally friendly are two big ones for us but.
We're excited for today.
In terms of scaling.
You can see.
That this type of product is very exciting for us the idea of a community based NFC system.
So 10000 memberships, if you will and get a whole bunch of cool stuff, we think that plays to our strength.
We can program the cool stuff part if you're interested in.
The animation graphic design, who better than somebody like an Anthony Francisco.
To do master classes with program around imagine if we did special screens with any of the Moody's in Anthonys worked on and he talked you behind the scenes what.
He did for them and some of the story decisions imagine so.
<unk> Stakes and prizes that result in all expense paid trips to comic Con, where we have teams of people at every summer.
You can imagine when we go to other verticals, whether its music movies TV sports what we can do we're already at the Grammys the Emmys the Oscars the Super Bowl.
I think we think of the NFC business.
Community based.
And I think if you talk to people on the inside.
I'm talking the blockchain the.
The competitive marketplaces et cetera.
How long pure art for Art's sake.
Will last is an open question, but the few everyone agrees that the future of Nf Ts is in utility.
But the NFC allows you to do something or receive something and.
And I think that's exactly.
Why we built what we've built and where we just quite frankly feel we have tremendous advantages and.
Entertainment related MFP community.
We have access to and can program better than anybody.
So that's what we're excited to roll out to the market.
Along the way by the way are art is going to look really really cool.
Denis.
And so.
That's that's what we're launching today and and then the question. After this initial launch will be the frequency and the.
And the speed that we can get the other verticals up and running.
But as we get into the first half of next year all the major verticals. We would've wanted we will want to have launched so we're in it for the long haul, but we're excited to start in each of the verticals that we already have expertise.
Is it reasonable to think that the N F T product.
It should be.
A high margin product.
I mean, it seems that way to me, but could you explain it.
Sure and if I could.
As I was trying to say in our numbers.
Really is illustrative of what we hope is considered a better mouse trap by the market I mean, we have the optionality in a huge catalyst and NFC is right I would argue that entities the dolphin.
Represent potential upside or more.
Many of the highest return.
Investments out there from biotech or wherever else if they work, but we feel our catalyst is as good as anybody else's.
But we're profitable along the way we've been building this technology and our ability to offer this product to market.
And have been EBITDA positive in both the second and third quarters.
So.
Therefore that should pretty much tell you what the margin can be.
You know obviously people have already received numerous calls so that people see the quick math 10000, avatars to $200 each of the $2 million product.
And youre starting in communities and so that means you can engage with our community every week Dale.
Daily hourly on social media, but.
And then as we this product was designed to be an event multi season event, so you're going to have more drops more.
More contests, and sweepstakes and and that's what allows you to to build and sustain that community that we'll have future drops in the future. So you might have another $2 million product.
Six months from now et cetera et cetera.
It scales very quickly.
And then of course, once we have multiple verticals going imagine a product and music.
Film one in sports, one and charity one in culinary.
One in gaming.
Right now that's up to six and you start cross selling with each other.
So you cross pollinate your communities and of course, you can have more than one community inside each vertical I mean using itself you're not going to one music community.
Multiple so for different types of music right. So it's an exciting world for us and we needed we needed the robustness.
If I just coined the term im not sure.
Of FCS and their wallet to allow for both the acceptance of credit cards.
The speed.
The strength of being able to build on the blockchain for those that volume of.
Offering globally.
So some of our programs, including Anthonys are going to appeal to an international audience very much.
Aliens no no national boundaries right. So.
It's an exciting it's an exciting day and I think it opens a glimpse to those who are interested in dolphin for our NFC capabilities.
To really get a sense of what we what we can accomplish.
And just to confirm that I understand the N F T market right.
You have the potential is it true that you have the potential to get recurring revenue if youre the creator of an NFC because every time, there's a secondary sale can you get.
A piece of that.
Yes. Thank you I'm sorry to go back to your previous question I'll answer in three parts the new question with that.
Yes, it's a very well sorry.
Sorry, My fault.
It's a very high margin business because.
Especially ex out aliens because this is an internal dolphin developed property.
100% of it and it's.
It is exciting for us to launch with that tend to show our creative drops.
And why we took the time to build an entire storyline around it there's a there's a.
<unk> got here.
Fans are going to want to be a part of an imagined.
Issue number one of one of the classic D C or Marvel Comics right, if you're a collector you're able to collect all episodes.
And that's exciting for us that's what I mean by future NFC drops, but secondly, you know, yes, we have recurring potential for recurring revenue and a couple of ways. One are those future drops to the same community.
We haven't decided on the number of episodes of exiled aliens, but whatever number it might be.
As we are refining that now.
Those are that's that's revenue you can go to the same community and give them a <unk>.
Added value.
Along the way and secondly, each NFC that we sell if it resales in the open market because new people want to be part of the community or certain of these entities are going to be very rare and valuable for a moment number one.
And yes, as they resell dolphin keeps seven 5% of the revenue.
In perpetuity across all sales.
Yeah.
Thank you.
Look at some of your dolphin, one point or businesses.
They should all be benefiting from.
Post pandemic recovery.
And I was wondering if you could kind of give us a sense of kind of.
What inning, we are in the recovery for some of these I know for example, like live nation.
On their third quarter call I think they said that there.
That there is some their tickets for major festivals were selling out and overall sales were up 10% versus 2019, which was pretty amazing. So I'm just carrying for yourself for yourselves.
How are you thinking about where you are in the recovery and the potential just just of and some of the areas just getting back to kind of where you were.
Sure Yeah. This growth has been accomplished without.
A full recovery, we've had some recovery, which is great and it's only going to continuing to build momentum, but the two big areas motion Pictures I've started to come back in theaters, which is great.
Obviously, we had James bond.
Earlier this month be around enhancing before it we have some others coming up.
But it's still not where it was.
It will we expect the motion picture business will be and hope that it will be where it was but the second quarter of next year and it's.
Growing up until that point.
The one that's still out there that hasn't recovered yet is the restaurant business.
<unk>.
There are signs of shoots coming up from out of the ground.
Trickling in but that's going to be a nice recovery play for us in 2022, I don't know if its first quarter, if it's going to take till the spring, but that will meaningfully impact our numbers.
Growth's been accomplished without that business being back.
And by the way that's really attribute to our subs you know I really included that line, yes, we're up 70% year over year, that's 41% organic growth from the existing subs.
That's tremendous growth and we have more to go as we get both the recovery play, but then also as longtime fans of the stock now.
Hum.
The companies are just getting stronger and stronger cross selling with each other we have more and more joint projects Youll joke I made when we had 42 west alone in the group.
Three years ago.
As you can't cross sell with yourself, [laughter], but now where youre up to six companies in this.
This golf and one point, though is only going to continue to grow.
Because we can cross sell and and recover so it's exciting times.
Gone from seven point something to eight point something to nine point something in successive quarters of record revenue. So that's got to say something to somebody.
And.
Social is.
It's kind of fascinating how that can kind of touch everything.
How do you think about kind of how that expands next year.
Well, it's funny, you say that Alan because in.
And those who remembered from the Q2 of 2020 remember.
The joke. We made then was it how the holidays came early when it be social joined the group because every one of our.
Market, leading PR firms wanted a sister company that was graded influencer marketing.
Dolphin one point, though.
You know I'm not going to.
Under emphasize.
Adding the social to the group and what it's meant but for dolphin to point out it's probably about touching everything as I highlighted I mean midnight theater yep. They can use be social both for the restaurant in a theater.
Fluent through marketing campaigns are marketing 101 today for any restaurant opening as the door.
Or hotel opening.
But then also.
With entities I mean, how do you get the word out and online about a new.
Offering and I think the fact that you know of.
A strong Influencer marketing campaign as we go forward and go into 2022, we're certainly looking.
For and.
Engaging be social on it on a consistent basis to help with these launches because they bring a lot of the word of mouth in a lot of the cool factor to it.
B, social sort of very important strategic part of our company and it couldnt be nicer people ran a nice cocktail that with them last Thursday in Los Angeles.
Yes.
Feel very lucky that the.
The social since at the Dolphin family.
That's great in terms of midnight theater will will there be a point next year, where we can get a sense of.
What the contribution could be I know, it's too early now but.
Yeah, I think so.
Get the opening we're going to have a lot of metrics for that.
Very confident.
And that investment we think it's going to do very well and it has a lot of room for growth I can get to in a second but lots of metrics probably by the time, we speak on the K call because we'll.
We will have.
With a theater you have advanced ticket sales.
We'll know pre opening numbers will probably nowhere post opening numbers.
Well have a sense.
How it does.
And if I could or how it's doing I think the the aspect of the variety of theater is really cool and I think it may.
It made the advantages of that may be missed.
By the casual investor.
A true.
A classic let's call It Broadway theater.
Rides into.
Entirely on whichever shows in a theater so here the Richard Rogers and you've got Hamilton, you're feeling great, but if you don't.
You know that's at risk here.
It's an all or nothing proposition.
For a variety of theater, you have a variety of Max.
And you have a variety of different audiences that you can bring in because of those acts in something like an intimate 160 seat theater that they've got a lot of seats to.
To fill that theater, and you don't need to fill it to be profitable but to.
To sell tickets there you're not it's not a heavy lift.
A variety of theater gives you a broad broad audience to go after there something literally for everyone.
Over a short period of time.
Challenge a variety of theaters, you can say well why doesn't everybody do a variety of theater theres a shortage of them.
There's two challenges you have to be able to program. It and you got to be able to market all of those different.
Tax well, that's where one plus one hopefully equals 11.
What do we have the ability to do we have the ability to market all of those different acts we already do.
From a wide variety of musical letting short buyer is the biggest and most expansive music PR firm in the world.
Types of acts that short buyer has.
In the roster.
Every genre of music.
It's not just pop.
It's rock.
<unk> is RMB.
Classic it's everyday and.
Any of those actually played midnight theater, so you get the.
A double win of both marketing and helping the program and so as.
As I mentioned on the prepared remarks, you know, whether it's a comedy whether its Broadway cabarets, whether its magic we already promote.
One of our PR agencies are already promotes those individual types of apps. So we have that expertise and if you can market it.
Then it then.
You've eliminated what's usually the challenge and Youre left with what's usually the positive.
And then of course every one of those axes are new audiences to the restaurant.
And new audiences, you can market to in the future.
Get all that data of what programs well jazz does it work and does it work on Tuesdays and Thursdays Saturdays et cetera, and you get smarter and smarter with each passing month.
So yes, it's exciting and then of course for the upside.
Yes.
You had this great venue and it's gorgeous location I mean for those who aren't familiar with Manhattan West that live in New York, you should really check it out.
I mean, it's brand new and $4 5 billion.
City block right, but.
But there's no reason why in success you cant take that concept to other cities.
And then the scaling of those economics is just gorgeous.
Whether it's Los Angeles, whether it's London, whether it's Nashville, whether it's Miami.
I mean, that's when we talk about catalysts, New York alone would be a catalyst for a company our size you start scaling it.
A whole different ball game, so that's why.
Midnight theaters was extremely attractive to us.
Okay. My last question find it somewhat financial.
How do you feel about your expense structure now.
Staffing and whatever tech spending.
Relative to your revenue growth do you do you think that there is operating leverage at this point in the business model.
I think so we have that.
Preparing for this day right. So we're close to full staffing needed to really would be.
To be able to expand the NFC business I assume thats.
But most people wanted to talk about past.
Uh huh.
This one collection into a series of collections will want to add one or two more people.
On the.
In that division, but.
A bulk of what we needed we have in the house now so that's exciting for us and to your original question on the NFC business.
It's not only a high margin business and the success, it's the highest margin business. So we have so.
It's.
But I would hope it would be a meaningful contributor in 2022.
[laughter].
Excuse me.
Yes.
Great. Thank you so much.
Sure.
I'd now like to turn the floor back to below doubt CEO of Dolphin Entertainment for closing remarks.
Oh man.
Oh, it's so sure it's going to get more questions well.
Thank you everybody and.
To that last point on Alan's question I should also say that's also why you saw we managed ourselves to the.
You know to EBITDA positive operating income positive even while we were.
Staffing up in investing.
Which is really fantastic. So thank you everybody for the time today and hope everybody has a great holiday season, I know, we will speak again in 2022, hopefully sooner than even the 10-K call. We'll look for an opportunity to do so but in the meantime, I think it could be looking for a couple of more announcements from us.
For the end of the year and we're excited for what this call represents our first two two point of initiatives and market.
So and if youre looking for something to do when.
When spring time rolls around in New York comes with a hidden leap in and have a drink with James Carbonara.
Thanks, everybody talk to you later.
Thank you ladies and gentlemen, this does conclude today's conference call. You may disconnect. Your phone lines at this time and have a wonderful day. Thank you for your participation.