ma
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from __________ to __________
Commission File Number:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
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(Address of principal executive offices) |
(Zip Code) |
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Registrant’s telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of July 31, 2022, the registrant had
table of contents
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1 |
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PART I. |
3 |
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Item 1. |
3 |
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3 |
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4 |
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Condensed Consolidated Statements of Comprehensive Income (Loss) |
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6 |
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8 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
25 |
Item 3. |
35 |
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Item 4. |
35 |
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PART II. |
36 |
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Item 1. |
36 |
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Item 1A. |
36 |
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Item 2. |
36 |
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Item 3. |
37 |
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Item 4. |
37 |
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Item 5. |
37 |
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Item 6. |
38 |
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40 |
forward-looking statements
This Quarterly Report on Form 10-Q contains forward-looking statements regarding future events and the future results of Vivid Seats Inc. that are based on our current expectations, estimates, forecasts and projections about the industries in which we operate and the beliefs and assumptions of our management. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Words such as “expect,” “anticipate,” “target,” “goal,” “project,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “likely,” “may,” “designed,” “would,” “future,” “can,” “could,” and other similar expressions which are predictions of, indicate future events and trends or which do not relate to historical matters, are intended to identify such forward-looking statements. These statements involve a number of risks, uncertainties and assumptions that are difficult to predict.
For example, we may use forward-looking statements when addressing topics such as:
1
Actual results may differ materially and adversely from those expressed in any forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document, or in the case of statements incorporated by reference, on the date of the document incorporated by reference. While we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.
Factors that might cause or contribute to such differences include, but are not limited to, those discussed in this Quarterly Report on Form 10-Q, under the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which was filed with the Securities and Exchange Commission (the “SEC”) on March 15, 2022, under the section entitled “Risk Factors,” in our press releases, and in our other filings with the SEC.
Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained in this Quarterly Report on Form 10-Q, whether as a result of new information, future events, or risks. New information, future events, or risks may cause the forward-looking events we discuss in this report not to occur.
2
VIVID SEATS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data) (Unaudited)
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June 30, |
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December 31, |
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2022 |
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2021 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Accounts receivable – net |
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Inventory – net |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment – net |
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Right-of-use assets – net |
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Intangible assets – net |
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Goodwill |
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Other non-current assets |
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Total assets |
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$ |
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$ |
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Liabilities and shareholders’ deficit |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses and other current liabilities |
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Deferred revenue |
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Current maturities of long-term debt – net |
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Total current liabilities |
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Long-term debt – net |
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Long-term lease liabilities |
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Other liabilities |
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Total long-term liabilities |
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Redeemable noncontrolling interests |
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Shareholders' deficit |
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Class A common stock, $ |
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Class B common stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
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( |
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( |
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Total Shareholders' deficit |
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( |
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Total liabilities, Redeemable noncontrolling interests, and Shareholders' deficit |
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$ |
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$ |
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The accompanying notes are an integral part of these financial statements.
3
VIVID SEATS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share data) (Unaudited)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2022 |
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2021 |
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2022 |
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2021 |
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Revenues |
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$ |
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$ |
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$ |
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$ |
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Costs and expenses: |
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Cost of revenues (exclusive of depreciation and amortization shown separately below) |
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Marketing and selling |
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General and administrative |
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Depreciation and amortization |
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Income from operations |
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Other (income) expense: |
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Interest expense – net |
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Loss on extinguishment of debt |
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Other income |
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( |
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( |
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Income (loss) before income taxes |
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Income tax expense |
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Net income (loss) |
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Net income (loss) attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization |
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Net income attributable to redeemable noncontrolling interests |
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Net income attributable to Class A Common Stockholders |
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$ |
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$ |
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$ |
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$ |
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Income per Class A Common Stock(1): |
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Basic |
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$ |
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$ |
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Diluted |
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$ |
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$ |
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Weighted average Class A Common Stock outstanding(1): |
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Basic |
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Diluted |
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(1)
The accompanying notes are an integral part of these financial statements.
4
VIVID SEATS INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in thousands) (Unaudited)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2022 |
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2021 |
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2022 |
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2021 |
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Net income (loss) |
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$ |
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$ |
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$ |
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$ |
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Other comprehensive income (loss): |
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Unrealized gain on derivative instruments |
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Comprehensive income (loss), net of taxes |
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$ |
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$ |
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$ |
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$ |
( |
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Comprehensive income (loss) attributable to Hoya Intermediate, LLC shareholders prior to reverse recapitalization |
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( |
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Comprehensive income attributable to redeemable noncontrolling interests |
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Comprehensive income attributable to Class A Common Stockholders |
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$ |
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$ |
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$ |
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$ |
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The accompanying notes are an integral part of these financial statements.
5
VIVID SEATS INC.
CONDENSED CONSOLIDATED STATEMENTS OF DEFICIT
(in thousands, except share/unit data) (Unaudited)
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Redeemable Senior preferred units |
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Redeemable Preferred units |
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Common units |
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Units |
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Amount |
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Units |
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Amount |
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Units |
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Amount |
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Additional paid-in capital |
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Accumulated deficit |
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Accumulated other comprehensive income (loss) |
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Total members' deficit |
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Balances at January 1, 2021 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
( |
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$ |
( |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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Unrealized gain on derivative instruments |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Deemed contribution from former parent |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Accretion of senior preferred units |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
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Balances at March 31, 2021 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
( |
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$ |
( |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Unrealized gain on derivative instruments |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Deemed contribution from former parent |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Accretion of senior preferred units |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
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Balances at June 30, 2021 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
( |
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$ |
( |
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6
VIVID SEATS INC.
CONDENSED CONSOLIDATED STATEMENTS OF DEFICIT
(in thousands, except share/unit data) (Unaudited)
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Class A Common Stock |
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Class B Common Stock |
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Redeemable noncontrolling interests |
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Shares |
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Amount |
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Shares |
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Amount |
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Additional paid-in capital |
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Accumulated deficit |
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Total shareholders' deficit |
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Balances at January 1, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
( |
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Net income |
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— |
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— |
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— |
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— |
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— |
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Issuance of shares |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Deemed contribution from former parent |
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— |
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— |
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— |
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— |
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— |
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Equity-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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Subsequent remeasurement of Redeemable noncontrolling interests |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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Balances at March 31, 2022 |
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$ |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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Net income |
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— |
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— |
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— |
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— |
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— |
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Issuance of shares |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Deemed contribution from former parent |
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— |
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— |
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— |
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— |
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— |
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Equity-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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Distributions to non-controlling interest |
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