What happened
For the past several weeks, MoviePass owner Helios and Matheson Analytics (HMNY) has issued press releases describing the health of its business -- mostly in terms other than dollars and cents. Some of the news has been good. Some of the news...hasn't.
Last night, though, Helios finally gave investors a close look at its actual financial statements when it filed its 10-Q quarterly earnings report with the SEC. How did it do?
Here's one hint: Helios and Matheson stock is down 17.6% as of 11:20 a.m. EDT.
Image source: Getty Images.
So what
So what did the owner of MoviePass report? Sales for the fiscal second quarter of 2018 surged 6,500% year over year to $74.2 million. That sounds like good news, but Helios's cost of revenue -- mainly the cost of buying tickets from movie theaters to hand out to its subscribers -- galloped 19,400% ahead to $178.8 million.
Thus, MoviePass ended the quarter with a $104.6 million gross loss on its business. That's before accounting for $22 million in operating expenses, after which the company ended up with a $126.6 million operating loss for the quarter. On the bottom line, MoviePass recorded an $83.7 million net loss, and the portion of that loss "attributable to Helios and Matheson Analytics" was $63.3 million, or $132.47 per share.
Which is rather a lot of money to lose, given that each of those shares currently sells for just a little more than $0.04.
Now what
Probably the biggest news of the quarter, though, is this: By the end of June, Helios and Matheson was down to just $15.5 million in cash reserves. The company has obviously made some funding moves since then, so Helios's cash position is probably a slightly different number today.
Still, Helios confirmed that it has burned through more than $219 million in negative free cash flow since 2018 began, which is in line with what the company reported in a separate press release that came out today: "MoviePass has purchased over $450 million worth of tickets in the last 12 months."
At this rate, $15.5 million in cash (if Helios still has it) would be enough to fund just 26 days' worth of Helios and Matheson's business. If you were wondering, then, why MoviePass moved to change its business model last week, now you know.
