Wilhelmina International, Inc. Reports Results for Third Quarter 2023

Third Quarter Financial Results

DALLAS, Nov. 09, 2023 (GLOBE NEWSWIRE) -- Wilhelmina International, Inc. (Nasdaq:WHLM) ("Wilhelmina" or the "Company") today reported revenues of $4.5 million and net income of $0.4 million for the three months ended September 30, 2023, compared to revenues of $4.4 million and net income of $1.9 million for the three months ended September 30, 2022. For the nine months ended September 30, 2023, Wilhelmina reported revenues of $13.4 million and net income of $0.5 million compared to revenue of $13.7 million and net income of $3.5 million for the nine months ended September 30, 2022. Net income for the three and nine months ended September 30, 2022 were significantly impacted by the full release of a previous $1.5 million valuation allowance against deferred tax assets.

Financial Results

Net income for the three months ended September 30, 2023 was $0.4 million or $0.07 per fully diluted share, compared to net income of $1.9 million, or $0.37 per fully diluted share, for the three months ended September 30, 2022. Net income for the nine months ended September 30, 2023 was $0.5 million, or $0.10 per fully diluted share, compared to $3.5 million, or $0.69 per fully diluted share, for the nine months ended September 30, 2022.

Pre-Corporate EBITDA was $0.8 million and $1.8 million for the three and nine months ended September 30, 2023, compared to Pre-Corporate EBITDA of $1.0 million and $3.6 million for the three and nine months ended September 30, 2022.

The following table reconciles reported total revenues under generally accepted accounting principles to Gross Billings, for the three and nine months ended September 30, 2023 and 2022.

Model costs include amounts owed to talent, including taxes required to be withheld and remitted directly to taxing authorities, commissions owed to other agencies, and related costs such as those paid for photography.

The following table reconciles reported net income under generally accepted accounting principles to EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA for the three and nine months ended September 30, 2023 and 2022.

Changes in net income, EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA for the three and nine months ended September 30, 2023, when compared to the three and nine months ended September 30, 2022, were primarily the result of the following:

• Total revenues for the three months ended September 30, 2023 increased 0.7% primarily due to increased commissions from model bookings. Total revenues for the nine months ended September 30, 2023 decreased by 1.8% primarily due to due to decreased commissions on bookings during the first half of the year;
  
• Salaries and service costs for the three and nine months ended September 30, 2023 increased by 3.3% and 7.4% primarily due to personnel hires and payroll changes to better align Wilhelmina staffing with the needs of each office and geographical region;
  
• Office and general expenses for the three and nine months ended September 30, 2023 increased by 17.8% and 40.9% primarily due to increased legal expense, rent expense, utilities, computer expenses, and other office related expenses;
  
• Amortization and depreciation expense for the three and nine months ended September 30, 2023 increased by 31.0% and 9.5%, primarily due to increased depreciation of capitalized furniture and leasehold assets at the Company’s New York City office; and
  
• Corporate overhead expenses for the three and nine months ended September 30, 2023 increased by 0.4% and 2.1%, primarily due to increased corporate travel expenses and the timing of audit costs incurred earlier than the prior year.
  

WILHELMINA INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

WILHELMINA INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
For the Three and Nine Months Ended September 30, 2023 and 2022
(In thousands, except for share and per share data)
(Unaudited)

WILHELMINA INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
For the Three and Nine Months Ended September 30, 2023 and 2022
(In thousands)

WILHELMINA INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
For the Nine Months Ended September 30, 2023 and 2022
(In thousands)
(Unaudited)

Non-GAAP Financial Measures

Gross Billings, EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA represent measures of financial performance that are not calculated and presented in accordance with U.S. generally accepted accounting principles (“non-GAAP financial measures”). The Company considers Gross Billings, EBITDA, Adjusted EBITDA and Pre-Corporate EBITDA to be important measures of performance because they:

• are key operating metrics of the Company's business;
• are used by management in its planning and budgeting processes and to monitor and evaluate its financial and operating results; and
• provide stockholders and potential investors with a means to evaluate the Company's financial and operating results against other companies within the Company's industry.
  

The Company's calculation of non-GAAP financial measures may not be consistent with similar calculations by other companies in the Company's industry. The Company calculates Gross Billings as the gross amounts billed to customers on behalf of its models and talent for services performed. The Company calculates EBITDA as net income plus interest expense, income tax expense, and depreciation and amortization expense. The Company calculates “Adjusted EBITDA” as EBITDA plus foreign exchange gain/loss, share-based payment expense and certain significant non-recurring items that the Company may include from time to time. There were no such non-recurring items during the nine months ended September 30, 2023 and 2022. The Company calculates “Pre-Corporate EBITDA” as Adjusted EBITDA plus corporate overhead expense, which includes director compensation, securities laws compliance costs, audit and professional fees, and other public company costs.

Non-GAAP financial measures should not be considered as alternatives to net and operating income as an indicator of the Company's operating performance or cash flows from operating activities as a measure of liquidity or any other measure of performance derived in accordance with generally accepted accounting principles.

Form 10-Q Filing

Additional information concerning the Company's results of operations and financial position is included in the Company's Form 10-Q for the third quarter ended September 30, 2023 filed with the Securities and Exchange Commission on November 9, 2023.

Forward-Looking Statements

This press release contains certain “forward-looking” statements as such term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relating to the Company are based on the beliefs of the Company’s management as well as information currently available to the Company’s management. When used in this report, the words “anticipate,” “believe,” “estimate,” “expect” and “intend” and words or phrases of similar import, as they relate to the Company or Company management, are intended to identify forward-looking statements. Such forward-looking statements include, in particular, projections about the Company’s future results, statements about its plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. Additionally, statements concerning future matters such as gross billing levels, revenue levels, expense levels, and other statements regarding matters that are not historical are forward-looking statements. Management cautions that these forward-looking statements relate to future events or the Company’s future financial performance and are subject to business, economic, and other risks and uncertainties, both known and unknown, that may cause actual results, levels of activity, performance, or achievements of its business or its industry to be materially different from those expressed or implied by any forward-looking statements. Should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. The Company does not undertake any obligation to publicly update these forward-looking statements. As a result, no person should place undue reliance on these forward-looking statements.

About Wilhelmina International, Inc. (www.wilhelmina.com):

Wilhelmina, together with its subsidiaries, is an international full-service fashion model and talent management service, specializing in the representation and management of leading models, celebrities, artists, photographers, athletes, and content creators. Established in 1967 by fashion model Wilhelmina Cooper, Wilhelmina is one of the oldest and largest fashion model management companies in the world. Wilhelmina is publicly traded on Nasdaq under the symbol WHLM. Wilhelmina is headquartered in New York and, since its founding, has grown to include operations in Los Angeles, Miami, and London. Wilhelmina also owns Aperture, a talent agency located in New York and Los Angeles. For more information, please visit www.wilhelmina.com and follow @WilhelminaModels.