Full Press Release Details
NEW MOTION, INC. / MPLC, INC. REPORTS FULL YEAR 2006
AND FOURTH QUARTER RESULTS
80% INCREASE IN FULL YEAR EPS ON 219% INCREASE IN NET SALES TO $18.7 MILLION
89% INCREASE IN FOURTH QUARTER NET SALES
IRVINE, CA, APRIL 2, 2007 -- New Motion Inc. (OTCBB: MNPC), a leading digital
entertainment company providing a broad range of digital and mobile products and
services to consumers, today announced financial results for the fourth quarter
and full year ended December 31, 2006. MPLC, Inc. is the publicly traded parent
For the full year 2006, net sales increased 219% to $18,721,000, compared with
net sales for 2005 of $5,867,000. This increase is the result of new billings
through the Company's partners and an expansion in the popularity of its Music
Trivia service, as well as a significantly larger billable customer base in 2006
when compared to 2005. The Company's gross profit margin for 2006 was 97%
compared with 95% for the comparable period a year ago. The Company posted net
income of $677,000, or $0.09 per share, in 2006. This compares with net income
of $387,000, or $0.05 per share, in 2005.
"New Motion's significant top-line growth in 2006 is a result of our continued
ability to efficiently acquire consumers across a range of interactive mobile
services," said Burton Katz, chief executive officer.
Net sales in the fourth quarter increased 89% to $6,178,000, compared with net
sales in the fourth quarter of 2005 of $3,277,000. The growth in net sales
reflected the Company's larger billable customer base in the fourth quarter of
2006 compared to 2005. Operating expenses in the fourth quarter of 2006
increased 135% to $6,717,000, compared with $2,857,000 in the fourth quarter of
the prior year. The increase in fourth quarter 2006 operating expenses, compared
with 2005, was a result of higher selling and marketing expenses incurred with
the objective of increasing the Company's subscriber base and also reflected
costs incurred to improve the Company's customer service capabilities. As a
result of the increase in operating expenses, the Company reported a net loss of
$397,000, or $0.05 per share, in the fourth quarter of 2006, compared with a net
income of $180,000, or $0.02 per share, in the fourth quarter of 2005.
Commenting on the fourth quarter, Katz stated, "We continue to capitalize on our
market leading position in the rapidly evolving digital entertainment space by
launching a range of new products, growing our subscriber base, and establishing
a capital platform - via our recent reverse merger and subsequent financing - to
be the leader in the US digital media entertainment market."
For further information related to the Company's operations and financial
results for the fiscal year ended December 31, 2006, please refer to the
Company's Annual Report on Form 10-KSB filed with the SEC on April 2, 2007.
"Building on our significant growth in 2006, this year we will concentrate our
efforts on several key areas that we believe will increase shareholder value,"
said Mr. Katz. "These include continuing to publish a diversified portfolio of
high-quality entertainment applications, strengthening and expanding our
distribution channels, expanding our technology assets, and enhancing our
organizational infrastructure through quality employees and best-in-class
operations. We believe that we are poised for significant growth and a
"In order to maintain our sales momentum and exploit our leading position in the
emerging mobile entertainment market, we are investing in our people and
customer service capabilities and making incremental improvements in our
organizational infrastructure" said Allan Legator, chief financial officer. "The
recent close in $20 million of gross equity financing strengthens our corporate
standing and positions New Motion as a leading publicly traded mobile digital
entertainment company," Legator concluded.
MPLC, Inc. operates through its wholly owned subsidiary, New Motion, Inc. New
Motion is a digital entertainment company providing a broad range of digital and
mobile products and services to consumers. New Motion combines the power of the
Internet, the latest in mobile technology, and traditional marketing /
advertising methodologies in their brands: MobileSidewalk(TM), one of the
largest U.S. based mobile entertainment companies; RingtoneChannel, a mobile
storefront provider; Bid4Prizes, a low-bid mobile auction game; and GatorArcade,
an online and mobile game site. Headed by a seasoned team of Internet, new
media, entertainment and technology professionals, New Motion was founded in
2005 and is headquartered in Irvine, California with a branch office in Los
Angeles. Wired Magazine recently declared New Motion's mobile content
capabilities a "rival to those of their mainstream-media counterparts," Wireless
Business Forecast named New Motion "a company to watch," and RCR Wireless News
noted that New Motion is "gaining traction in the direct-to-consumer ring." For
more information, please visit www.newmotioninc.com.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, about MPLC and New Motion.
Forward-looking statements are statements that are not historical facts. Such
forward-looking statements, based upon the current beliefs and expectations of
MPLC's management, are subject to risks and uncertainties, which could cause
actual results to differ from the forward looking statements. The following
factors, among others, could cause actual results to differ from those set forth
in the forward-looking statements: changing interpretations of generally
accepted accounting principles; continued compliance with government
regulations; legislation or regulatory environments, requirements or changes
adversely affecting the businesses in which New Motion engaged; demand for the
products and services that New Motion provides, general economic conditions;
geopolitical events and regulatory changes, as well as other relevant risks
detailed in MPLC's filings with the Securities and Exchange Commission. The
information set forth herein should be read in light of such risks. MPLC assumes
no obligation to update the information contained in this press release.
COMPANY CONTACT INVESTOR CONTACT
------------------------------------- ------------------------------------
Allan Legator Dean Oakey
New Motion, Inc. (213) 253-2282
Chief Financial Officer and Secretary
MPLC, INC. AND SUBSIDIARIES
SELECTED BALANCE SHEETS ITEMS
Cash ............................................................ $ 544
Accounts receivable, net ........................................ $ 3,527
Total current assets ............................................ $ 4,965
Total Assets .................................................... $ 5,494
Accounts payable and accrued expenses ........................... $ 3,707
Total liabilities ............................................... $ 4,271
Total stockholders' equity ...................................... $ 1,223