Q4 2021 Dolphin Entertainment Inc Earnings Call
[music].
Good afternoon, ladies and gentlemen, and welcome to the Dolphin Entertainment fourth quarter 2021 earnings call. At this time, all participants have been placed on listen only mode.
I'll open the floor for your questions and comments after the presentation. It is now 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 fourth quarter and full year 2021 earnings call with me on the call are below doubt Chief Executive officer, and merits immigrating Chief Financial Officer.
I'd like to begin the call by reading the Safe Harbor statement. The statement is made pursuant to the Safe Harbor statement for forward looking statements described in the private Securities Litigation Reform Act of 1995.
All statements made on this call with the exception of historical facts may be considered forward looking statements within section 27 of the Securities Act of 1933 and SEC.
21, the Securities Exchange Act of 1934, although the company believes that expectations and assumptions reflected in these forward looking statements are reasonable it makes no assurances that such expectations will prove to have been correct. Actual results may differ materially from those expressed or implied in the forward looking statements due to various risks and uncertainties for a discussion.
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 Bob reports on Form 10-Q , as well as in other reports that the company files from time to time with the Securities Exchange Commission.
Any forward looking statements included in the service all are made only as of the day 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 Bill O'dowd, Chief Executive Officer of Dolphin Entertainment Bill. Please proceed.
Thanks, James and Hi, everyone. Good afternoon, and thank you for joining US today as always we will start with a review of some financial and operating highlights followed by a full financial review and then we'll open it up for Q&A.
Overall 2021 will be remembered as a transformative year for dolphin, both respect to our balance sheet and operating income as well as in our evolution to make big investments in assets for which we believe our marketing expertise will greatly influence the likelihood of success.
Let's start with our financial statements the momentum from the first nine months of the year carried through to the fourth quarter looking at the P&L. We have set another new quarterly revenue record with $10 5 million in revenue up 57% year over year.
Each quarter of 'twenty 2021 set a then record for revenue Q1 reached $7 2 million in revenues a record broken in Q2, which reached $8 6 million in revenues, followed by Q3, which set a then record with $9 4 million in revenues now we've achieved $10 5 million in revenues.
Q4, all of these increases have been entirely organic and a result of the super groups growth and cross selling of services.
And with each successive quarter setting a new record in revenue.
Obviously, the full year set a new revenue record as well, reaching $35 8 million, which is an approximate 49% increase from the prior year.
Next we look at our operating income, which is the metric by which we gauge ourselves.
'twenty one was a milestone year in this regard as well as we turn to operating income positive after deducting non cash items of depreciation and amortization and a change in the fair value of contingent consideration. We are very proud of this achievement, especially since our expenses included investments in our two <unk> initiatives.
Finally, I'll make a comment on our balance sheet, while I know that we will be releasing the balance sheet. Upon the completion of the audit, which we expect to occur in the next few days I would be remiss, if I didn't point out and believe me that this feels great to say in 2021, we reached a working capital surplus with more cash on hand, and all remaining debt.
Including long term debt, which has allowed us to remove our going concern a tremendous milestone for any microcap public company.
Now, let's move to some operational updates on our Super group the companies that are making those great numbers happen.
We will start with short fire media.
Dolphins industry, leading music PR firms, which had a great 2021, punctuated by a fourth quarter working on clients and projects, who collectively earned 27 Grammy nominations, reflecting the breadth of the company's roster across RMB electronic global routes for jazz Blues Gospel contemporary Christian comedy and other job.
Sure fires leadership in music PR shows no sign of slowing down just last month's, helping the red carpet Bud Light Super Bowl Music Fest, three nights of all star talent, including Green day, and Miley Cyrus Blake Shelton in Glens defining with banking guidance policy and machine gun Kelly and other special guests.
Turning to <unk> 42, West Dolphins Entertainment PR powerhouse they were busy in the fourth quarter as well from the promotion of the latest James Bond movie to Steven Spielberg's adaptation of West side story to and just like that the heart stopping the revival of sex and the city if youre watching it chances are 42 us promoting it but you don't have to take my word for it the observer.
Just released its ranking of the best PR agencies in America 2022, a widely respected list of the 50, most powerful public relations firms in the nation 40 to US was ranked number two in the country. Once again, the highest ranking of any entertainment PR firm. The observer notes 40 to US led by CEO of Amanda Lundberg, yet again as recognized for.
Elite PR services for film TV, and corporate PR management with clients, including nearly every studio and streaming service several a list talent and impactful brands like fandom bond Turner and riot games, congratulations to everyone at 42 west for such an incredible recognition.
Moving along to be social Dolphins Influencer marketing group. It was a busy quarter that included partnerships with Japanese media franchise, Juggernaut Pokemon company B Social group talent Influencer campaigns also included Mcdonalds capital, one and Skims clothing line Cofounded by Kim Kardashian, and addition be social Influencer network worked on projects for fashionable footwear <unk>, which.
Made oprah's favorite things list as well as Ciroc Sports illustrated Swimsuit magazine and fashion collections for Nordstrom.
Moving to viewpoint creative Dolphins respected creative relations agency and video production boutique viewpoint brought home for Golden use awards in this year's international competition viewpoints worked with clients HBO Max.
AAA northeast delivery firefighters foundation and personal media one of the categories of video television program video insurance video documentary and video public service and activism respectively.
Finally, we will talk about the door are leading culinary hospitality and lifestyle PR firm during the fourth quarter of the door was busy promoting the New York City in wine and food Festival launching Rachael Ray's book this must be the place and Dan richer in Cape Parlors book Petroleum Pizza that sounds pretty good both of which became New York times category bestsellers, and finding a room to promote.
National Peppermint bark de for client Hagen Dazs, if youre eating drinking our making a reservation for it chances are the doors promoting it and once again you don't have to take my word for it. The door also made the observers widely respected ranking of 50, most powerful public relations firms in the nation. The observer notes the door led by co founder President.
Lowest najarian O'neill and co founder CEO , Charlie Doug Yellow was credited for overseeing the launch of dolphin centered.
Entertainment Center T studio last year, along with providing a unique integrated marketing approach for many high profile clients, including Williams Sonoma Citarella Hagen Dazs, Sir Kensington fast casual chain plant Burger the Francis Ford Coppola winery in the Expo to Dubai.
That is tremendous recognition from sustained observer and I'd also like to recognize Charlie lowest in the entire door team for playing an essential parts of the dolphin to no initiatives, we're going to talk about a few minutes.
Alright, 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 was the very best at marketing pop culture, and we define what we call it off and to point out was using pop culture to market assets that we own the whole point of assembling the Super group of entertainment marketing companies and putting them.
Within a public company. So that we can take ownership positions and assets, we create where in our form of marketing expertise will influence the likelihood of success simply put we want to own some of the types of things that we know we can market better than anybody else.
In terms of our business model broadly speaking there are two types of dolphin to point O initiatives ones, where we develop assets in the categories of content consumer products or live events and ones, where we receive ownership stakes in other people's companies that have assets in those three categories.
Let's talk about the second type of Dolphin 2.0 investments first I'll start with craft cocktails in December 2021, we announced a strategic partnership with craft cocktails of pioneering brand of ready to drink all natural classic cocktails created by World renowned <unk>, Charles Zhou Li and esteemed restaurant tour, Matt Lindner.
Real quality ingredients balanced cocktails and authenticity at every level have been hallmarks of the brand since day one.
Now, perhaps house cocktails as a company and Thats almost 10 years old they have an award winning product lines and they wanted to Super group led by the door to help market the products. They pay us a cash fee every month to do just that and we also receive an ownership stake in the company and return for the added value of the services and relationships extended by the entire Super group.
We structured our relationship with Fanjuls another $2 two point of initiative that we announced in the first quarter of this year in the same way.
<unk> is a new online experiential platform, creating memorable interactions between fans and a curated list of premier talent to support their favorite causes the platform features Raphael and the Dol Aaron Judge tool Ashanti, Kevin O'leary, Josh Richards, Jen Selter, Daymond, John and Patrick Mahomes was 15 and the <unk> Foundation.
To attack a of Loews Miami got to be able to say that to a foundation and similar to craft house cocktails with Fanjul, we receive a monthly cash fee for services and we also receive an equity stake in their company and return for the added value of the services and relationships extended by the entire Super group.
With respect to these types of dolphin to point our initiatives, we typically look to receive somewhere between five and 10% of the equity in the respective company. In addition to the monthly cash fee.
With respect to the other types of dolphin to point out initiatives, wherein we developed assets that we are excited to market. We do not receive a monthly cash fee since we would often be simply paying it to ourselves, but correspondingly we take a larger ownership position in the product or venture. Examples of these types of dolphin to point of investments would be mid <unk>.
Theater in the NFC marketplace, we have been building.
Let's start with midnight on.
On October 12, 2021, we announced the acquisition of an ownership stake in Midnight theater.
Temporary variety theater, and restaurants that will anchor the $4 5 billion development from Brookfield known as Manhattan West.
As we've previously shared for dolphin the midnight theaters. The most exciting live venue concept, we have seen in a very very long time, it will be a truly modern variety theatre paired with a fantastic restaurant, which is which is a combination that is missing in the cultural landscape today.
We expect to open a restaurant in June of this year and be in previews. This summer with the theater with a grand opening in a full seven day a week theatrical calendar in the fall.
Dolphin will manage all aspects of publicity and marketing for the venue, both the restaurant and the theater as well as facilitate talent and commercial relationships within both the entertainment and culinary industries.
We're hopeful that midnight theater creates a relatively straightforward or predictable range of modeling because even though it has two components our restaurant by the way the restaurants call. It didn't leave in the theater Midnight Theater I should add it has a third component a bar named James Carbonara is landing spot.
It has many of the variables already defined for the model Y because there is a certain number of seats in each so you can model out and average ticket price and the number of turns in the restaurant you can do the same in the theater with an assumption of a number of shows per week and this will quickly get you to a revenue model and of course, we will look to operate the venue and a reason.
Profit margin standard in the industry and <unk>.
Success of course, we will look to add locations around the country and around the world you can quickly see how this opportunity came to become very exciting for our company at this stage dolphin in 2022.
We invested $1 million into the venture for a stake of approximately 13%. We also invested in the options for up to another.
Approximately 25%.
As you can tell we're very excited for midnight theater.
Now I'll turn to NFC.
As a reminder, last August we announced our partnership with <unk>, the leading crypto currency exchange and wallet provider with over 1 million active users and over $10 billion of average trading volume per day.
And that was as of last August I am sure. They are much higher now our goal is to create an program global NFC collections targeting all of Dolphins verticals, including sports film television music gaming esports culinary lifestyle would charity industries. We then brought in award winning visual designer Anthony Francisco from Marvel Studios, where he was the senior visual development artist responsible for.
Designing iconic characters across the Marvel cinematic universe following that in December we announced artwork had begun on creature chronicles exiled aliens Dolphins first generative NFC collection, which will feature 10000 unique custom crafted averaged avatars of an ancient race of aliens designed by Anthony himself.
In March of this year, we announced our partnership with flower Girls Flower Girls is a fine art female led NFC collection of 10000 unique flower girls by revered artist Barbara for <unk>.
Talking to vast launched in December of 2021, the flower girls has surpassed over $15 million in sales to date and is donating 20% of profits from both primary and secondary NFC sales to a variety of children's charities voted on by the community in February more than $400000 was donated across children's charities, including.
Adding $200000 to St. Jude Children's Research Hospital client that is also on Dolphin Entertainment's extensive roster. The flower girls also give an additional 5% of profits towards collecting children incentive T art supporting and empowering the next generation of ours.
Dolphin is activating its entire network of leading marketing and promotional agencies to amplify the flower girls charitable initiatives as well as expand community benefits and increased value for flower girls holders Dolphin will also leverage its unique position to explore meaningful and exciting new opportunities for brand growth across all lifestyle and <unk>.
Payment verticals, including but not limited to scripted and unscripted TV series digital and traditional publishing consumer products music gaming and events and of course, we will promote the living sugar out of future flower girls that have tea collections.
As a partner in the venture. So you can see that we have worked hard over the past several months to allow us to take advantage of our efforts in the NFC space. This coming summer, we expect to have other flower girls announcements in Q2, and the launch creature chronicles exiled aliens for sale in Q3.
Each of these collections will have a retail value in the seven figures, which allows the NFC each entity collection to represent significant potential upside for dolphin. Once we go on sale.
So I'll pause I'll pause there.
In summary, we're extremely pleased with these first $4 two point of initiatives and hopefully today's conversation provided some additional detail.
One year ago on December 31, 2020, we had not yet started.
Flooring dolphin to point out initiatives, we always talked about January one 2021 is the starting line for dolphin because by then we would have scale with our Super group, we had six companies.
It had been acquired and that we would begin to explore what we wanted to make investments in.
By December 31, 2021, we have launched the first three of these dolphin two <unk> initiatives. The NFC marketplace was being built midnight theater had been we had acquired an ownership stake in what you're obviously entered into a strategic partnership with craft cocktails. We added a fourth initiatives subsequent to year end, which is.
Fanjuls.
Social media App in closing I would like to also reiterate that these two investments are on top of a growing one point of a business that has led to record revenues for four quarters in a row, including more than 57% year over year revenue growth in the fourth quarter, we are profitable and growing.
<unk> with a pristine balance sheet and now we are at a point, where we can see dolphin to flourish. This.
Our thesis when we uplifted to NASDA Q4 years ago and began assembling Super group.
Thank you for joining us on this right and to that end ill now turn it over to Mary <unk>, Our Chief Financial Officer.
Thank you Bill and good afternoon, everyone.
I will now discuss results for the year ended December 31, 2021 revenues for the year were approximately $35 $7 million as compared to $24 million for the year ended December 31 2020.
Overall operating expenses for the year were approximately $41 2 million compared.
Compared to approximately $26 $7 million.
In the prior year.
Operating expenses are composed of direct costs payroll and benefits selling general general and administrative costs changes in the fair value of contingent consideration.
<unk> and amortization and legal and professional fees.
Direct costs for the year ended December 31, 2021 were approximately $3 9 million compared to $2 6 million in the prior year.
General and benefit costs.
The year ended December 31, 2021 were approximately $23 8 million compared.
Compared to $15 $9 million in the prior year.
Selling general and administrative expenses for the year ended December 31 2021.
Approximately $5 $8 million.
Third to $48 million in the prior year.
Legal and professional fees were approximately $2 million compared to $1 2 million.
Sure.
Operating loss was $5 4 million.
Including noncash items from depreciation and amortization.
<unk>, one $9 million and changes in the fair value of contingent consideration of approximately $3 $7 million.
This compared to an operating loss of approximately $2 6 million in the prior year, which included noncash items from depreciation and amortization.
$2 million.
Net loss was approximately $6 4 million, which included noncash changes in fair value of liability of approximately $3 1 million.
And approximately <unk> <unk>.
$3 million up again.
On extinguishment of debt.
This compared to a net loss of approximately $1 9 million, which was positively impacted by non cash changes in the fair value liability.
Approximately $9 million.
Gain on extinguishment of debt of approximately $3 3 million.
And a loss of approximately one $5 million on the deconsolidation of variable interest entities for the year ended December 31st 2020.
Basic and fully diluted loss per share was <unk> 85 per share.
Just on $7 million 614774 weighted average shares outstanding.
This compares to 35.
Basic loss per share.
Based on $5 million 619969 weighted average shares.
And 58.
Fully diluted loss per share.
Just on 6.382 million 937 weighted average shares outstanding last year.
Yes.
Cash and cash equivalents as.
As of December 31, 2021 were seven 7 million.
Seven $9 million last year.
That concludes my financial remarks, I will now ask the operator to open the phone lines for Q&A.
Later would you please poll for questions.
Absolutely. Thank you, ladies and gentlemen, if you have any questions or comments. Please indicate so by pressing star one on your Touchtone phone pressing star two will remove you from the queue should your question to be answered and lastly, while posing your question. Please pickup your handset listening on speaker phone to provide optimum sound quality. Please hold while we poll for questions once again.
And Thats Star one if you have a question or comment.
First question is coming from Allen Klee with Maxim Group your.
Your line is live.
Yes, hi, congrats.
Good deed on my numbers for the quarter.
Good momentum.
So the questions that I have starting off if I look at what's your revenue was for the quarter.
How.
Was all of this revenue from the Super groups or was any of it from the.
2.0, so far.
All of it was from the Super Group, we Havent recognized any two point no revenue until this summer.
Got it okay.
And then you said just the timing of just to make sure I got it got it correct did you say that midnight theater, the restaurant will start in.
At <unk> in June and then the.
The theater in the fall flower girls will be in <unk>.
<unk> Q and exiled Alley Allianz will be in.
<unk>.
Yes, Alan Thats right, except that one more caveat to that the restaurant will open in <unk>.
First of all thank you for the kind words at the start of your comments as well.
Very happy with our quarter as well so thank you.
The midnight theater the restaurant, we anticipated opening in June we'll start that theater and previews, we have a variety of different acts.
Looking now.
For the summer.
It's a fully.
The immersive theater experience it'll be a really great spot for music for Broadway cap raise for comedy acts for a wide berth magic acts a wide variety of entertainment will.
We will be doing previews of different types of acts over the summer we have some pretty exciting announcements coming over the next several weeks and then the whole theater, while the grand opening in the fall.
With.
A full seven day, a week schedule of entertainment to go with the theater with excuse me with the restaurant.
So.
And that's the timing for Midnight Theater, Yes, and then the and then in terms of the NFC collections.
We've been building our ability to.
We have now finished our ability to sell NFC collections, taking a credit card we're excited for that.
Have the flower girls partnership that we're extremely excited by we expect to flowers girl announcement, we're excited to share here in Q2, maybe.
Be on look out for that and then we expect to have XL. The aliens. The creature chronicles collection from Anthony Francisco finished it on sale in Q3.
And when you said you expected seven figure.
Revenues from the <unk>.
Was that referring to the X io to alien drop and the and the flower girl drop each one of them.
Yes, each collection will have the total retail value in the MLR seven figures.
No.
That's the that's the.
The expectation from your mouth to God's ears, Alan as we embark on this journey, but but flower girls. The first collection did sell out.
They achieved a $2 million initial sale.
The excuse me $2 million of the.
Revenues from the initial collection and then they've generated over $13 million of secondary sale sense for total collection revenue of over $15 million.
Great, Okay, and then any and any commentary on the outlook for.
2022, I mean, when I look at too.
Simplistically I would think that your super groups business should be.
Should be better.
As the economy opens up.
Door recovers.
There should be some.
And cross selling that.
That should probably be up year over year, then for for a 2.0, it's kind of just the timing of when it's all going to kick in but but if theres anything you could add.
And if theres any seasonality to think about the business.
Sure Yeah no. Thank you we think so too first quarter is always the slowest.
For many of our subsidiaries. So it wasn't really surprising that last year. The same same was true the first quarter was the lowest but the growth has been.
Steady and as I mentioned at the top it's all organic and there were no acquisitions that affected those numbers.
They are.
Our last acquisition was effective as of January 1st of last year at the vendor helper. So.
<unk>.
It really quite frankly, we feel validated proved the thesis for dolphin, one point out that our acquisitions can cross sell with each other and the fact when you have the leading.
Are the leaders in their respective fields I mean, let's just brag about 40 to us for a hot second to be ranked the second most powerful PR firm in the country.
Right in any industry.
Again, the leader in Entertainment, then Youre going to receive your fair share of the growth of the industry and the advent of these streaming services I think probably everybody on this call subscribes to more than one streaming service as we like to say back in 2018 in 2019 or putting the Super group together and I was on the road.
Going to be all this content coming some but he's got to promote it right. So this organic growth the cross selling its working we are growing.
And then why do we think we built a better mousetrap was that we could take our profits and invest in owning some assets that we could take a obviously a much bigger upside if we owned the assets that we're promoting and I'd be remiss if I didn't point out that craft House. Cocktails example, here's an example of what we can also do there are a lot of companies out there.
Have consumer products or live events that would want this group of marketing leaders to market their products. So we can better monetize our services by taking a cash fee every month like we would normally do and taking an equity stake in the venture to be able to access the 42 west and the shore fires and the <unk>.
<unk> socials, because they know that that if we market their products or services that they're more likely to achieve their goals, whether it's too.
Do a fundraising round to sell the company to just grow the company.
<unk> have some type of liquidation event in the future. So that's exciting for us with those types of deals are equally exciting.
For Us and then when you add to that the huge optionality, if something like a midnight theater or an NFC business. Then that's what we mean by we think we have a better mousetrap, we have the optionality of big swings like biotech companies or others, but we're not bleeding cash along the way we are actually making cash along the way.
That's I think our outlook for 2022 is the satisfaction of getting to this point too.
Two point I was going to generate revenue in just a couple of months.
Theaters open flower girls will have an announcement will up creature chronicles on sale, that's all very exciting for us.
That's great and that in June on average the margins will be higher than your company average for two boy now is that reasonable yes.
Yes.
And then Super groups, I think to point out will be higher than.
Super groups.
Yes, yes, I mean, we have a very very solid provide services business right as we can see and people that know our story you've seen us being built over four years, but as someone who made who did 20 years of content ownership.
Often before.
In success, if you own the asset you are marketing Youre, just going to make a much much higher margin by definition right.
You can provide great marketing services for James Bond, but I promise you the people that own James bond or making more than we are.
Picking absurd example, right well, it's the same across every every layer.
It's a food festival, if it's music festival, if it's a consumer product if you own the product youre going to make a lot more and there are certain I guess, that's the underlying assumption of our thesis to Atwood.
There are certain products, where the marketing makes a bigger difference to whether theyre going to succeed.
<unk>.
Yes.
Think of marketing liquor or think of marketing beauty and cosmetics products or think of marketing perfume or think of marketing whatever you have.
As an example in your head where.
Having the ability to market it and create consumer adoption is far more valuable than say doing the same thing for an automotive automobile right.
The quality of the product matters a lot on the automobile right. So I think that's what we're looking for it and use.
Use our marketing to the greatest monetary advantage for ourselves and our shareholders.
Okay.
Four four.
For items.
<unk> that you can create a brand that has.
Becomes an annuity that you do.
Continuing stories continuing drops.
What do you think is reasonable for how many like drops can be done in a year.
Well.
Part of that's a great question Alan.
We have a lot of experts in house on how it works in the analog world.
For marketing collectibles to the consumer.
Theres no one knows the NFC collections started really less than a year ago today.
So.
Youre always going to get a transparent answer and and the truth is we're going to experiment.
We think that the market can hold at least two drops per year per brand.
We'll see if we're right.
And in part of that is going to be how well you can engage the community. These people are buying and ftes to participate many of them in online communities around the around the brand and and where we think we have a big advantages that we can deliver a lot of community benefits we have experiences.
We can share with our communities, we have prizes and giveaways. We can we can supply that that quite frankly very few others. If any can provide because of backstage or.
Invitations to venues and et cetera et cetera. So.
And then what we're also excited about something like flower girls is there there is a great brand right. It's got great art, it's family friendly its charitable.
And what can you do with the word flower girls.
There are a lot of brand extensions for that type of a.
Community and in many of those brand extensions and I don't want to give away anything that we may be working on there will have to announce shortly.
Fall into the areas of expertise of our companies.
So that's exciting for us and that's why we selected that female fronted NFC collection to partner with we're very excited about that collection and they've done very well they sold they sold out like I said.
That's fantastic so.
For for Midnight Theater.
I'm just trying to remember there.
Midnight Theater is.
It's a hydrogen 60 seat venue.
Venue.
And then the restaurant is 75 seats, plus 26, private dining 40 seat bar lounge.
Yeah.
Are there any public company that you could point us to to think about what reasonable Mike.
You said that we could model this based on you know.
Number of seats and assumptions do you know if theres any industry rule of thumb that you could point us to for that.
Yeah, and without getting into specific guidance preopening or anything.
Ryan.
It's a tricky one I'm excited to talk a lot more about midnight theater over the subsequent earnings calls I will say if you think about.
No.
For lack of a better word I'll say cool spots like that do you look at certain groups that have that type of pedigree, whether it be Tao, obviously that was bought by Madison square garden or others that could create locations around the country and around the globe that we.
Think we have a difference of course is that our venue will have that high quality restaurants high quality bar, but it's got a theater right for live performance and.
And as you can imagine we think we're uniquely positioned to not just promote the acts that come in there but.
To facilitate the relationships with the industry.
Or the industries. So there really is no direct comp because you.
Could say in the old days, How's the blues, but I'm not sure. They would have thought of themselves in the same vein on the restaurant and bar side.
They were for music only.
So what would you consider to be something similar but.
And we also think that's a huge opportunity right. Many people on this call are in New York City.
Very very few places can offer.
A full night out in one location.
No.
And we can and of course thats within our.
Drop dead gorgeous complex I mean, it takes two city blocks with Brookfield built it's incredible and right across the plaza from us as the other restaurant that Danny Meyer's restaurants. It's just got nominated for James Beard Award right, but if you want entertainment and a high quality restaurant at the same venue. Then we think we have something unique so.
But I think when you start modeling around those types of comps I think you'd get pretty close.
Okay, Great and do you have so much on your plate.
Does producing movies still still fit in there or is that maybe or however, you think about that.
Oh Allen. Thank you just have to wait a very short period of time for that for that vertical to open up for us.
Okay.
Going back to 2.0.
We've we've been consistent in saying that the four legs of that stool for us will be taking ownership stakes in other people's companies, So thats craft house.
Thats fanjul, it will be our own content, which hasnt started yet but.
Patients it will be our own consumer products, which has started to us thats entities in a weird way midnight theater.
Because I mean that data practically encompasses all the categories and then of course around live events. So I think it's fair to say that we expect to content vertical to open up shortly.
And in the live events, probably closer to the end of the year.
For obvious reasons since we're coming out of Covid, we're feeling good music tours that our clients are booked are holding music festivals are opened up so when the world the world Hungry for live entertainment.
So we think we can get into live events by the end of the year.
Content sooner.
Great.
And I know you.
We're not really giving you are not giving guidance, but any thoughts on like.
How youre thinking about the financial discipline of managing revenue growth relative to expense growth.
Sure well I mean, if I, if I could give merit and the team at Dolphin, a big Pat on the back I mean, we were on this call a year ago and said, we're going to manage ourselves to make the two point, though investments in 2021 out of the cash that we're generating and I feel really good about where we ended when you show on that piece.
On that P&L.
Subtracting the noncash items depreciation and amortization.
And the change in the fair value of the contingent consideration.
We landed income operating income positive after making the investments in the NFC market.
<unk> and others. So I feel good about that I think we will start to see our revenue exceed.
Continue to grow is what I'm trying to say sorry.
The operating income continue to grow and then with some of these opportunities it's always been.
Just what are the opportunities that present themselves to us.
Do we want to do we want to take them and if so.
How we manage our own cash accordingly, but.
We're profitable and we're growing and I think we will continue to stay so even while we're making these investments.
Obvious growing within a very short period of time. The two investments we expect will generate outsized returns right. So just be a matter of investing at a fraction of what we're making right now we're choosing carefully because we're growing our profits this year than last year. This year and next year as we are.
The first of the investment.
Excellent Okay. That's it for me. Thanks. Thank you so much congratulations.
Thank you Alan and very much.
Is there any remaining questions. Please indicate so by pressing star one up next we have Gregg Greenberg private investor Greg Your line is live.
Greg can you hear us your line is live.
Greg seems to be having technical difficulties.
Please press star one.
Kind of put you back in the queue.
All right next we have Brian Swift with Security Research Associates, Brian Your line is live.
Hi.
Last year, you had a lot of noncash type charges.
Which I assume were from our message made prior you said you only did one deal in January of this year.
Other than the fact that you may do more deals.
And 'twenty two.
Do you how do you envision those types of charges is that like a nonrecurring tanger or are we going to see more of that because it kind of made a major year end statement it looks like here.
Losing a lot of money instead of.
The positive cash flow this year.
That you talked about.
Sure no. Thank you for the question, Brian We had some of those fair value instruments that are expiring are ending.
The puts and after last year and that that created large fair value.
Swings in.
In any given quarter or any given year.
When we bought the companies for the Super Group.
Provided the bulk of these acquisitions have earn outs.
The contingent consideration proud to say.
How well the companies did in making the earn outs, which is what you want to see I think but they create noncash swings as well so we're pretty much through that after last year. There was only one company left with an earn out that will be earned we anticipate by the end of this year. So a lot of these noncash items are expiring.
Almost and it's quite possible that all of them will.
By the end of this calendar year. So we're almost through those noncash items depreciation and amortization will stay with us as you can imagine.
For a while but the.
The bigger numbers that created the bigger swings like in last year of the noncash items should be we should be finished by the end of this year.
Okay. That's good alright, thank you.
Sure. Thank you Brian .
Okay next.
We have Gregg Greenberg, Greg can you hear us your line is live.
Greg Please check your mute button.
Okay.
Having technical difficulties, we can't hear you from our side Greg.
If there are any remaining questions. Please press star one at this time.
Okay. We have no further questions in queue I'd like to turn the floor back to Bill Odowd for any closing remarks.
Well, thank you and Greg if youre out there feel free to reach out to James Carbonara and be happy to line up the call.
I'm sure, it's frustrating not to be able to get the tech to work.
And obviously James does a great job for us and it was our honor to named Bart.
After.
Just kidding.
But.
Thank you again to everyone that that has followed our story obviously, we were very proud of the last year.
Hit some really nice milestones on a financial perspective.
But that's only the start.
<unk> is why we built this company we're.
We're excited for the investments we've made.
We're excited for both types of two point no investments the ones, where we take smaller ownership stakes in other people's companies and the ones, where we take a more active role in a larger stake in.
And developing assets.
We think that combination of a profitable company a profitable base that's growing with those types of upsides is what makes us a little different and hopefully.
Something that gets people excited to be to invest in and be a part of the journey. So thank you for those who are and I'll look forward to speaking to everybody again in just a few short weeks.
So thank you everybody for the time.
Alright.
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.