LOS ANGELES, March 28 /PRNewswire-FirstCall/ -- AVP, Inc.
(OTC:AVPI) (BULLETIN BOARD: AVPI) , a lifestyle sports
entertainment company focused on professional beach volleyball,
today announced record financial results for its full year ended
December 31, 2007. AVP generated record revenue of $24.1 million in
2007, an increase of 12% year-over-year. 2007 Milestones: -- Record
annual revenue of $24.1 million, a 12% increase from $21.5 million
in 2006. -- AVP extended title sponsorship agreement with Crocs to
title AVP Crocs Tour through end of 2012 season. --
Sponsorship/advertising revenues up 11% year-over year. -- Added
MyNetwork TV as a television partner in 2007 to join NBC and Fox
Sports Net for domestic coverage; AVP was seen in over 125
countries internationally in 2007. -- Entered a five-year agreement
with Australian Volleyball Federation to begin promoting the
Australia tour in 2008 -- Partnered with Anschutz Entertainment
Group to produce first-ever indoor beach volleyball national tour
-- Hot Winter Nights in 2008 "The AVP continues its revenue growth
after a successful 2007 season. We are especially excited for our
AVP athletes shooting for gold in the 2008 Olympics in Beijing,
China," said Leonard Armato, Chief Executive Officer of AVP, Inc.
"We have 18 events scheduled for the 2008 Crocs AVP season. We also
continue to make solid progress attracting new sponsors and
advertisers and renewing and extending our existing agreements. Our
title sponsorship with Crocs, which is also sponsoring our
Australian series, has been extended to 2012. The Company continues
to have in place sponsorship agreements with Bud Light, Gatorade,
Nautica, Paul Mitchell, Jose Cuervo Tequila, Wilson, McDonald's
Nature Valley and Hilton." "Our promoter-based operating model
continues to increase our visibility and awareness in local key
markets. In 2008 we will again be working with pre-eminent sports
promoters such as the Brooklyn Sports & Entertainment Group,
Hicks Sports Marketing Group, Miami Heat Enterprises and San
Francisco's Giants Group Enterprises, to name a few. The transition
to a promoter model is enabling us to better extend our brand into
the local communities." "We remain focused on continued revenue
growth, managing our expenses and expanding our brand. We are
looking forward to an exciting 2008 schedule and increased exposure
to beach volleyball during the 2008 Olympics." 2007 Financial
Results Total revenue for 2007 reached a record $24.1 million, a
12% increase over total revenue of $21.5 million for 2006. During
the course of the entire year, the majority of AVP's revenues are
derived from sponsorship and advertising contracts with national
and local sponsors and advertisers along with local event revenue
and ancillary revenue. AVP recognizes sponsorship and advertising
revenue as well as event costs during the tour, as events occur.
The Company's 2007 beach volleyball tournament season began in
early April and continued through late September and as a result,
the majority of AVP's revenues were recognized in the second and
third quarters of the calendar year. The Company's net loss in 2007
was $(4.0) million, or $(0.20) per share, compared to a net loss of
$(0.34) million, or $(0.03) per share, for 2006. Our $(4.0) million
net loss is consistent with the company's net loss guidance as
previously provided. Total event costs for 2007 were $17.7 million
for 18 events, compared to $14.7 million in the same period last
year, which included 16 events. The average event cost during 2007
was $1.0 million, up 8% from $0.9 million in 2006. The cost
increase is primarily attributable to increases in the number of
events from 16 to 18, increases in network broadcast time and
television production cost and an increase in prize money. Total
operating expenses for 2007 were $10.5 million, an increase of 42%
from $7.4 million in 2006. Operating expenses increased primarily
from the proposed transaction with Shamrock Holdings, Inc. and
increases in sales and marketing expenses. Total operating expenses
for 2007, excluding stock based expenses, were $10.3 million. The
company had $2.3 million in cash and cash equivalents on December
31, 2007. About the AVP, Inc. AVP Pro Beach Volleyball Tour, Inc.
is a leading lifestyle sports entertainment company focused on the
production, marketing and distribution of professional beach
volleyball events worldwide. AVP operates the industry's most
prominent national touring series, the AVP Pro Beach Volleyball
Tour, which was organized in 1983. Featuring more than 200 of the
top American men and women competitors in the sport, AVP is set to
stage 18 events throughout the United States in 2008. AVP athletes
will once again be prominent representing the United States during
the 2008 Olympics in Beijing, China in August. In the last Olympics
in 2004 in Athens, Greece, AVP athletes won gold and bronze medals.
For more information, please visit http://www.avp.com/. All
above-mentioned trademarks are the property of their respective
owners. Some of the information in this press release may contain
projections or other forward-looking statements regarding future
events or the future financial performance of the Company. We wish
to caution you that these statements involve risks and
uncertainties and actual results might differ materially from those
in the forward-looking statements, if we receive less sponsorship
and advertising revenue than anticipated, or if attendance is
adversely affected by unfavorable weather. Event-related expenses,
such as for the stadium, transportation and accommodations, or
security might be greater than expected; or marketing or
administrative costs might be increased by our hiring, not
currently planned, of a particularly qualified prospect. Additional
factors have been detailed in the Company's filings with the
Securities and Exchange Commission, including our recent filings on
Forms 10- KSB and 10-QSB. - Financial tables to follow - AVP, INC.
CONSOLIDATED BALANCE SHEETS December 31, December 31, 2007 2006
ASSETS CURRENT ASSETS Cash and cash equivalents $2,257,453
$5,052,636 Accounts receivable, net of allowance for doubtful
accounts of $149,748 and $25,193 2,008,253 2,653,473 Prepaid
expenses 388,649 242,007 Other current assets 116,393 301,477 TOTAL
CURRENT ASSETS 4,770,748 8,249,593 PROPERTY AND EQUIPMENT, net
392,447 340,054 OTHER ASSETS 115,496 105,373 TOTAL ASSETS
$5,278,691 $8,695,020 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT
LIABILITIES Accounts payable $908,020 $529,331 Accrued expenses
1,663,975 1,049,439 Deferred revenue 101,245 1,056,960 TOTAL
CURRENT LIABILITIES 2,673,240 2,635,730 NON-CURRENT LIABILITIES
96,419 190,766 TOTAL LIABILITIES 2,769,659 2,826,496 COMMITMENTS
AND CONTINGENCIES STOCKHOLDERS' EQUITY Preferred stock, 2,000,000
shares authorized: Series A convertible preferred stock, $.001 par
value, 1,000,000 shares authorized, no shares issued and
outstanding - - Series B convertible preferred stock, $.001 par
value, 250,000 shares authorized, 47,152 and 69,548 shares issued
and outstanding 48 70 Common stock, $.001 par value, 80,000,000
shares authorized, 20,490,096 and 19,751,838 shares issued and
outstanding 20,490 19,752 Additional paid-in capital 39,732,837
39,077,065 Accumulated deficit (37,244,343) (33,228,363) TOTAL
STOCKHOLDERS' EQUITY 2,509,032 5,868,524 TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $5,278,691 $8,695,020 - - AVP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS Year Ended December 31, 2007
2006 REVENUE Sponsorships/Advertising (1) $19,300,128 $17,388,458
Other 4,788,106 4,083,622 TOTAL REVENUE 24,088,234 21,472,080 EVENT
COST (2) 17,744,998 14,665,430 GROSS PROFIT 6,343,236 6,806,650
OPERATING EXPENSES Sales and Marketing (3) 3,381,577 2,573,500
Administrative (4) 7,155,897 4,847,155 TOTAL OPERATING EXPENSES
10,537,474 7,420,655 OPERATING LOSS (4,194,238) (614,005) OTHER
INCOME (EXPENSE) Interest expense (745) (23,659) Interest income
178,639 181,003 Gain on sale of asset 9,774 9,863 Gain on warrant
derivative - 111,042 TOTAL OTHER INCOME 187,668 278,249 LOSS BEFORE
INCOME TAXES (4,006,570) (335,756) INCOME TAXES (9,410) (800) NET
LOSS (4,015,980) (336,556) Deemed Dividend to Series B Preferred
Stock Shareholders - 91,973 Net Loss Available to Common
Shareholders $(4,015,980) $(428,529) Loss per common share: Basic
$(0.20) $(0.03) Diluted $(0.20) $(0.03) Shares used in computing
loss per share: Basic 20,171,918 16,918,490 Diluted 20,171,918
16,918,490 (1) Sponsorship/advertising includes $507,800 and
$252,482 in stock base contra revenue for the year ended December
31, 2007 and 2006, respectively. (2) Event costs include stock
based expenses of $0 and $1,000,000 for the year ended December 31,
2007 and 2006, respectively. (3) Sales and marketing expenses
includes stock based expenses of $94,381 and $119,942 for the year
ended December 31, 2007 and 2006, respectively. (4) Administrative
expenses includes stock based expenses of $214,233 and $293,190 for
the year ended December 31, 2007 and 2006, respectively.
DATASOURCE: AVP, Inc. CONTACT: Tom Torii, Interim CFO of AVP, Inc.,
+1-310-426-8000, Web site: http://www.avp.com/
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