Skullcandy Reports Third Quarter 16% Net Sales Growth

PARK CITY, Utah, Nov. 5, 2015 (GLOBE NEWSWIRE) — Skullcandy, Inc. (NASDAQ:SKUL) today announced financial results for the third quarter ended September 30, 2015.

Third quarter 2015 reported results versus the same quarter a year ago

  • Net sales: $67.2 million vs. $58.1 million, up 16% (up 19% currency neutral)
  • Gross margin: 41.0% vs. 45.3%, down 430 basis points (down 272 basis points currency neutral)
  • Selling, general and administrative expense (SG&A): $24.5 million vs. $22.7 million, up 8%
  • SG&A expense as a percent of net sales: 36.4% vs. 39.2%
  • Operating income: $3.1 million vs. $3.6 million, down $0.5 million (up 29% currency neutral)
  • Earnings per share $0.08, up 8% (up 29% currency neutral)

“Our third quarter performance was highlighted by twenty two percent net sales growth in the U.S. and fourteen percent constant currency net sales growth in our international markets. Our product innovation, demand creation and distribution strategies are resonating with Skullcandy and Astro consumers around the world,” said Hoby Darling, President and Chief Executive Officer. “Our deep relationship with our consumer, coupled with our ability to be nimble and quick to market allows us to serve our consumer innovative and creative products that align with current trends. Our new Skullcandy wireless ear buds and headphones are a great example and an awesome addition to our existing product lineup that already includes several of the best-selling styles at retail. Strong sell-through of our new wireless products and increased year over year sales of our traditional wired products contributed to Skullcandy being the number one chosen headphones in the US for the fourth consecutive quarter. At the same time, Astro continues to dominate the high end of the gaming market with its leading portfolio of next-generation compatible headsets that now include Halo 5 and Call of Duty licensed editions. We remain very confident in the strategic course that we have set for the Company.”

Net sales in the third quarter of 2015 increased 16% to $67.2 million from $58.1 million in the same quarter a year ago, or an increase of 19% on a currency neutral basis. Domestic (U.S.) net sales increased 22% to $47.0 million from $38.5 million in the same quarter a year ago, due to increases in both Audio and Gaming categories. International (Non U.S.) net sales increased 3% to $20.2 million from $19.5 million in the same quarter a year ago, or an increase of 14% on a currency neutral basis, primarily due to increased audio product sales in India, Australia, China and increased gaming product sales in Europe.

Gross profit in the third quarter of 2015 increased 5% to $27.6 million from $26.3 million in the same quarter a year ago, or an increase of 12% on a currency neutral basis. Gross margin decreased to 41.0% in the third quarter of 2015 from 45.3% in the same quarter a year ago primarily due to approximately 160 basis points of negative foreign currency effects and product mix shift towards generally lower margin wireless and gaming products.

Selling, general and administrative (SG&A) expenses in the third quarter of 2015 increased 8% to $24.5 million from $22.7 million in the same quarter a year ago, or an increase of 10% on a currency neutral basis. The increase in SG&A expenses is primarily due to increases in demand creation, research and innovation, personnel, and in-store display depreciation expenses, partially offset by a decrease in foreign sales tax. As a percentage of net sales, SG&A expenses decreased 280 basis points to 36.4% as compared to 39.2% in the same quarter a year ago.

Operating income in the third quarter of 2015 was $3.1 million compared to $3.6 million in the same quarter a year ago, but was up 29% on a currency neutral basis. This slight decrease in operating income is due to a lower gross margin percentage and increased SG&A expenses to fund future growth, partially offset by net sales.

Net income in the third quarter of 2015 was $2.3 million, or $0.08 per share, based on 28.8 million weighted average diluted common shares outstanding. Net income in the same quarter a year ago was $2.1 million, or $0.07 per share, based on 28.5 million weighted average diluted common shares outstanding. On a currency neutral basis, net income increased 30%.

*”Currency neutral basis,” assumes the foreign exchange rates in effect for the three months ended September 30, 2015 were in effect for the three months ended September 30, 2014 and that neither period receives the effect of foreign currency related income or expense. See the supplemental financial information for additional information regarding currency neutral basis.

Balance Sheet Highlights

As of September 30, 2015, cash, cash equivalents, and short-term investments totaled $13.9 million compared to $36.6 million as of December 31, 2014. This decrease mostly reflects the Company’s implementation of accelerated payment programs with certain contract manufacturers that began during the second quarter of 2015. In part due to the accelerated payment programs, our Accounts Payable and Accrued Liabilities decreased $11.6 million and $10.4 million from December 31, 2014 to September 30, 2015, respectively. The Company expects to realize product cost reductions and gross margin benefits as a result of such accelerated payment programs. Furthermore, the decrease in cash, cash equivalents, and short-term investments was also due to payments for in-store displays that were placed into service. The Company continued to have no outstanding debt. Accounts receivable, net decreased 12% to $65.5 million as of September 30, 2015 from $74.4 million as of December 31, 2014. Inventories, net increased 14% to $62.5 million as of September 30, 2015 from $55.0 million as of December 31, 2014.

2015 Full Year and Fourth Quarter Financial Outlook

For the full year 2015, the Company forecasts net sales to increase 10-11% over 2014 levels, or approximately 13% on a constant currency basis, and net income on a U.S. GAAP fully-diluted per share basis of a range of $0.37 to $0.39, an increase of 42% over 2014 levels, or approximately 82% on a constant currency basis.

For the fourth quarter of 2015, the Company forecasts net sales to increase 5-7% over 2014 levels, or approximately 9% on a constant currency basis, and net income on a U.S. GAAP fully-diluted per share basis of a range of $0.38 to $0.40, an increase of 49% over 2014 levels, or approximately 65% on a constant currency basis.

Call Information

A conference call to discuss the third quarter of 2015 results is scheduled for today, November 5, 2015, at 4:30 PM Eastern Time / 2:30 PM Mountain Time. A broadcast of the call will be available on the Company’s website, In addition, a replay of the call will be available shortly after the conclusion of the call and remain available through November 13, 2015. To access the telephone replay, listeners should dial (877) 870-5176 or (858) 384-5517 and entering conference ID number 116963.

About Skullcandy, Inc.

Skullcandy is the original lifestyle and performance audio brand inspired by the creativity and irreverence of youth culture. Skullcandy designs, markets and distributes audio and gaming headphones, earbuds, speakers and other accessories under the Skullcandy, Astro Gaming and 2XL brands. Skullcandy launched in 2003 and quickly became an international audio brand by bringing innovation, bold color, character and performance to an otherwise monochromatic audio space. Skullcandy products are sold and distributed through a variety of channels in the U.S. and approximately 80 countries worldwide, including the Company’s websites at and Skullcandy offers a wide array of styles and price points and are expanding into complementary audio products and categories such as sports performance, women’s and wireless offerings, as well as partnerships with leading manufacturers to license the Skullcandy brand.

Forward-Looking Statements

Certain statements in this press release and oral statements made from time to time by representatives of the Company are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In particular, statements regarding the Company’s anticipated future financial and operating results and any other statements about the Company’s future expectations, beliefs or prospects expressed by management are forward-looking statements. These forward-looking statements are based on management’s current expectations and beliefs, but they involve a number of risks and uncertainties that could cause actual results or events to differ materially from those indicated by such forward-looking statements. Important factors that could cause actual results to differ materially from expectations are disclosed under the “Risk Factors” section of the 2014 10-K filed with the Securities and Exchange Commission (“SEC”) on March 13, 2015 and our 2015 10-Qs. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company does not undertake any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

-Financial Tables Follow-

(in thousands of dollars)
Three months ended September 30,



% Change
% Change
Net sales$ 67,168$ 58,05516%19%
Gross profit27,55326,3245%12%
Selling, general and administrative expenses24,47122,7418%10%
Income from operations3,0823,583(14)%29%
Net income attributable to Skullcandy, Inc.$ 2,301$ 2,1069%30%
Diluted earnings per share$ 0.08$ 0.0714%29%

Skullcandy is a global company and reports financial information in U.S. dollars in accordance with generally accepted accounting principles in the United States (“GAAP”). Foreign currency exchange rate fluctuations impact the amounts reported by Skullcandy from translating its operating results into U.S. dollars, and from entering various transactions denominated in different currencies.

*These rate fluctuations can have a significant effect on reported operating results. As a supplement to our reported operating results, we present currency neutral financial information, which is a non-GAAP financial measure. Currency neutral financial information assumes a constant exchange rate between the periods being compared for purposes of currency translations into U.S. dollars (i.e., assumes the foreign exchange rates used to determine results for the three months ended September 30, 2015 apply to the period against which such results are being compared). We use currency neutral information to provide a framework to assess how our business performed.

Certain amounts included in the calculations of currency neutral operating results, which constitute non-GAAP measures, are subject to management allocations and assumptions. The company believes the presentation of information on currency neutral basis is helpful to investors by making it easier to compare the company’s performance in one period to that of another period without the variability caused by fluctuations in currency exchange rates.

These currency neutral performance measures should be viewed in addition to, and not in lieu of or superior to, our operating performance measures calculated in accordance with GAAP. The currency neutral information presented may not be comparable to similarly titled measures reported by other companies.

(in thousands of dollars, except share and per share information)
Three months ended September 30,Nine months ended September 30,
Net sales$ 67,168$ 58,055$ 171,359$ 150,996
Cost of goods sold39,61531,731100,24982,280
Gross profit27,55326,32471,11068,716
Selling, general and administrative expenses24,47122,74170,65167,749
Income from operations3,0823,583459967
Other expense2619341,144729
Interest (income) expense(1)(9)(12)183
Income (loss) before income taxes and noncontrolling interest2,8222,658(673)55
Income tax expense (benefit)697507(116)(284)
Net income (loss)2,1252,151(557)339
Net income (loss) attributable to noncontrolling interest(176)45(344)124
Net income (loss) attributable to Skullcandy, Inc.$ 2,301$ 2,106$ (213)$ 215
Net income (loss) per common share attributable to Skullcandy, Inc.
Basic$ 0.08$ 0.07$ (0.01)$ 0.01
Weighted average common shares outstanding
(in thousands of dollars)
September 30,December 31,
Current assets:
Cash and cash equivalents$ 10,354$ 21,623
Short-term investments3,54115,010
Total cash, cash equivalents, and short-term investments13,89536,633
Accounts receivable, net65,47174,358
Inventories, net62,47854,981
Prepaid expenses and other current assets7,6284,050
Current deferred tax assets4,1633,052
Total current assets153,635173,074
Property and equipment, net14,62412,911
Deferred financing fees3441
Non-current deferred tax assets1,3903,459
Total assets$ 191,328$ 212,166
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable$ 15,700$ 27,309
Accrued liabilities18,71329,161
Current deferred tax liabilities524184
Total current liabilities34,93756,654
Non-current deferred tax liabilities1,2881,418
Other non-current liabilities1,008557
Total liabilities37,23358,629
Stockholders’ equity:
Common stock33
Treasury stock(43,294)(43,294)
Additional paid-in capital137,583136,132
Accumulated other comprehensive loss(960)(625)
Retained earnings60,56760,781
Total stockholders’ equity153,899152,997
Noncontrolling interest196540
Total Skullcandy stockholders’ equity154,095153,537
Total liabilities and Skullcandy stockholders’ equity$ 191,328$ 212,166
(in thousands of dollars)
Nine Months Ended
September 30,
Cash flows from operating activities:
Net income (loss)$ (557)$ 339
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization8,0027,020
Loss on disposal of property and equipment and intangible assets64690
Provision for doubtful accounts, net311618
Deferred income taxes843(2,419)
Non-cash interest expense7186
Amortization of stock-based compensation expense3,1782,591
Foreign currency remeasurement losses1,594382
Changes in operating assets and liabilities:
Accounts receivable7,6003,865
Prepaid expenses and other current assets(4,189)(2,286)
Accounts payable(10,485)17,133
Accrued liabilities(12,428)1,421
Net cash (used in) provided by operating activities(14,349)5,349
Cash flows from investing activities:
Purchase of property and equipment(8,206)(5,766)
Purchases of short-term investments(15,000)
Proceeds from sale of short-term investments11,488
Net cash provided by (used in) investing activities3,282(20,766)
Cash flows from financing activities:
Debt issuance costs(5)
Proceeds from exercise of stock options3591,777
Taxes paid related net share settlement of equity awards(462)
Income tax benefit (detriment) from share based compensation135(394)
Net cash provided by financing activities321,378
Effect of exchange rate changes on cash and cash equivalents(234)(78)
Net decrease in cash and cash equivalents(11,269)(14,117)
Cash and cash equivalents, beginning of period21,62338,835
Cash and cash equivalents, end of period$ 10,354$ 24,718
Supplemental cash flow information:
Cash paid for income tax$ 3,779$ 1,430
Supplemental non-cash activities:
Purchases of property and equipment financed through accounts payable$ 627$ —


We manage our business in two segments which are comprised of Domestic and International. The Domestic segment primarily consists of Skullcandy and Astro Gaming product sales to customers in the United States. The international segment primarily includes Skullcandy product sales to customers in Europe, Asia, Canada, Mexico (through the Company’s joint venture), and all other geographic areas outside the United States that are served by the Company’s International operations.

The table below summarizes information about reportable segments for the three and nine months ended September 30, 2015 and 2014 (in thousands):

Three months ended September 30,
20152014$ Change% Change
Net sales:
Domestic$ 46,976$ 38,521$ 8,45522%
Total net sales$ 67,168$ 58,055$ 9,11316%
Three months ended September 30,
20152014$ Change% Change
Gross profit:
Domestic$ 20,044$ 17,185$ 2,85917%
Total gross profit$ 27,553$ 26,324$ 1,2295%
Three months ended September 30,
20152014Basis Point Change
Gross margin %:
Total gross margin41.0%45.3%(430)
Nine Months Ended September 30,
20152014$ Change% Change
Net sales:
Domestic$ 119,380$ 104,102$ 15,27815%
Total net sales$ 171,359$ 150,996$ 20,36313%
Nine Months Ended September 30,
20152014$ Change% Change
Gross profit:
Domestic$ 50,478$ 47,120$ 3,3587%
Total gross profit$ 71,110$ 68,716$ 2,3943%
Nine Months Ended September 30,
20152014Basis Point Change
Gross margin %:
Total gross margin41.5%45.5%(400)
         Brendon Frey
         [email protected]

Mad Catz(R) Reports Fiscal 2016 Second Quarter Financial Results

SAN DIEGO, Nov. 5, 2015 (GLOBE NEWSWIRE) — Mad Catz Interactive, Inc. (“Mad Catz” or the “Company”) (NYSE MKT:MCZ) (TSX:MCZ), today announced financial results for the fiscal 2016 second quarter ended September 30, 2015.

Key Highlights of Fiscal 2016 Second Quarter and Subsequent:

  • Fiscal 2016 second quarter net sales increased 73% to $38.9 million, the highest second quarter net sales in the Company’s history;
  • Net sales growth driven by a 272% increase in net sales to the Americas, partially offset by an 11% decrease in net sales to EMEA and a 48% decrease in net sales to APAC;
  • Gross margin declined to 23.1% from 30.0% in the prior year quarter;
  • Total operating expenses increased 14% from the prior year period to $8.1 million;
  • Operating income was $0.9 million compared to an operating loss of $0.4 million in the prior year quarter;
  • Diluted loss per share was ($0.02) for the fiscal 2016 second quarter, compared to a diluted loss per share of ($0.01) last year;
  • Net position of bank loans, less cash, of $12.7 million at September 30, 2015, compared to $5.8 million at June 30, 2015 and $8.9 million at September 30, 2014;
  • Shipped Rock Band™ 4 Band-in-a Box™ Software Bundle, Wireless Fender™ Stratocaster™ Guitar Controller and Software Bundle, and stand-alone software for Xbox One and PlayStation™ 4 to retailers ahead of the October 6th launch date for Rock Band 4;
  • Announced F.R.E.Q.TE™ 7.1 surround sound gaming headset for Windows PC;
  • Announced pre-order availability of the first Street Fighter™ V licensed fightstick starting October 26, 2015;
  • Shipped R.A.T. PROX™ high-performance gaming mouse, a 2015 CES Innovation Award Honoree;
  • Shipped R.A.T. PROS™ tournament-grade gaming mouse; and,
  • Established an “At-the-Market” (“ATM”) equity offering program through which the Company may sell from time to time up to an aggregate of $25.0 million of our common stock.
Summary of Financials
(in thousands, except margins and per share data)
Three Months
Ended September 30,
Six Months
Ended September 30,
Net sales$38,918$22,46773%$51,892$39,21432%
Gross profit9,0066,73134%11,88411,7941%
Total operating expenses8,1477,15514%14,78713,34911%
Operating income (loss)859(424)(303%)(2,903)(1,555)87%
Net loss(1,611)(922)75%(5,576)(2,167)157%
Net loss per share, basic and diluted($0.02)($0.01)100%($0.08)($0.03)167%
Gross margin23.1%30.0%(690) bps22.9%30.1%(720) bps
Adjusted EBITDA (loss) (1)$1,391($111)(1,353%)($1,674)($557)201%
(1) Definitions, disclosures and reconciliations regarding non-GAAP financial information are included on page 8.

Commenting on the Company’s fiscal 2016 second quarter results, Darren Richardson, President and Chief Executive Officer of Mad Catz, said, “We are very pleased to announce record second quarter sales driven by the successful launch of Rock Band 4. As expected, we started shipping product to retailers at the end of September, ahead of the October 6th launch date, and we expect Rock Band 4 to contribute to significant sales growth, improved operating leverage, and increased cash flow in Fiscal 2016.”

Summary of Key Sales Metrics
Three Months
Ended September 30,
Six Months
Ended September 30,
(in thousands)20152014Change20152014Change
Net Sales by Geography
Sales by Platform as a % of Gross Sales
Next gen consoles (a)73%21%61%17%
PC and Mac17%43%25%45%
Smart devices3%11%5%10%
Legacy consoles (b)1%5%1%6%
Sales by Category as a % of Gross Sales
Specialty controllers69%25%59%24%
Mice and keyboards7%22%10%23%
Games and other5%1%4%1%
Sales by Brand as a % of Gross Sales
Mad Catz75%34%64%34%
(a) Includes products developed for Xbox One, PlayStation 4 and Wii U.
(b) Includes products developed for Xbox 360, PlayStation 3 and Wii.

Karen McGinnis, Chief Financial Officer of Mad Catz, commented, “We are pleased with our return to top-line growth for the quarter and year-to-date and remain confident that our business strategy, product offerings and financial position will help us return to sales growth and profitability in fiscal 2016. We remain focused on effectively managing our inventory, expenses and accounts receivable while positioning the Company to benefit from the upcoming holiday season.”

The Company will host a conference call and simultaneous webcast on November 5, 2015, at 5:00 p.m. ET, which can be accessed by dialing (303) 223-4376. Following its completion, a replay of the call can be accessed for 30 days at the Company’s Web site (, select “About Us/Investor Relations”) or via telephone at (800) 633-8284 (reservation #21783853) or, for International callers, at (402) 977-9140.

About Mad Catz

Mad Catz Interactive, Inc. (“Mad Catz”) (NYSE MKT:MCZ) (TSX:MCZ) is a global provider of innovative interactive entertainment products marketed under its Mad Catz® (gaming), Tritton® (audio), and Saitek® (simulation) brands. Mad Catz products cater to passionate gamers across multiple platforms including in-home gaming consoles, handheld gaming consoles, Windows® PC and Mac® computers, smart phones, tablets and other mobile devices. Mad Catz distributes its products through its online store as well as distribution via many leading retailers around the globe. Headquartered in San Diego, California, Mad Catz maintains offices in Europe and Asia. For additional information about Mad Catz and its products, please visit the Company’s website at

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Safe Harbor

Information in this press release that involves the Company’s expectations business prospects, plans, intentions or strategies regarding its future are forward-looking statements that are not facts and that involve substantial risks and uncertainties. You can identify these statements by the use of words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “should,” “plan,” “goal,” “believe,” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Among the factors that could cause the Company’s actual future results to differ materially from those expressed in the forward-looking statements set forth in this release are the following: the ability to maintain or renew the Company’s licenses; competitive developments affecting the Company’s current products; first-party price reductions; availability of capital under our credit facilities; commercial acceptance of new in-home gaming consoles; the ability to successfully market both new and existing products domestically and internationally; difficulties or delays in manufacturing; unanticipated product delays; or a downturn in the market or industry. A further list and description of these and other factors, risks, uncertainties and other matters can be found in the Company’s most recent annual report, and any subsequent quarterly reports, filed with the U.S. Securities and Exchange Commission and the Canadian Securities Administrators. The forward-looking statements in this release are based upon information available to the Company as of the date of this release, and the Company assumes no obligation to update any such forward-looking statements as a result of new information or future events or developments, except as may be require by applicable law. Forward-looking statements believed to be true when made may ultimately prove to be incorrect. These statements are not guarantees of the future performance of the Company and are subject to risks, uncertainties and other factors, some of which are beyond its control and may cause actual results to differ materially from current expectations.

Consolidated Statements of Operations
(in thousands, except share and per share data)
Three Months
Ended September 30,
Six Months
Ended September 30,
Net sales$38,918$22,467$51,892$39,214
Cost of sales29,91215,73640,00827,420
Gross profit9,0066,73111,88411,794
Operating expenses:
Sales and marketing4,4573,4777,1735,889
General and administrative2,6382,7225,5325,873
Research and development9418461,8621,368
Amortization of intangible assets111110220219
Total operating expenses8,1477,15514,78713,349
Operating income (loss)859(424)(2,903)(1,555)
Other expense:
Interest expense, net(364)(167)(621)(325)
Foreign currency exchange loss, net(154)(382)(93)(417)
Change in fair value of warrant liabilities(871)74(917)55
Other income (expense)10(2)2279
Total other expense(1,379)(477)(1,609)(608)
Loss before income taxes(520)(901)(4,512)(2,163)
Income tax expense(1,091)(21)(1,064)(4)
Net loss($1,611)($922)($5,576)($2,167)
Net loss per share:
Shares used in per share computations:
Consolidated Balance Sheets
(in thousands)
September 30,
March 31,
Current assets:
Accounts receivable, net27,6597,823
Other receivables992560
Deferred tax assets1,5662,245
Income taxes receivable341967
Prepaid expenses and other current assets1,8971,293
Total current assets72,57033,509
Deferred tax assets7,6067,605
Other assets686418
Property and equipment, net3,8263,376
Intangible assets, net2,4902,584
Total assets$87,178$47,492
Current liabilities:
Bank loans$19,638$7,920
Accounts payable38,75516,404
Accrued liabilities13,6474,196
Notes payable9191,015
Income taxes payable557141
Total current liabilities73,51629,676
Notes payable, less current portion9736
Warrant liabilities2,1041,187
Deferred tax liabilities4343
Deferred rent738762
Total liabilities76,49831,704
Shareholders’ equity:
Common stock63,39063,128
Accumulated other comprehensive loss(4,917)(5,123)
Accumulated deficit(47,793)(42,217)
Total shareholders’ equity10,68015,788
Total liabilities and shareholders’ equity$87,178$47,492
Consolidated Statements of Cash Flows
(in thousands)
Six Months
Ended September 30,
Cash flows from operating activities:
Net loss($5,576)($2,167)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization1,0381,060
Accrued and unpaid interest expense on note payable10
Amortization of deferred financing fees18936
Loss on disposal of assets66
Stock-based compensation262240
Change in fair value of warrant liabilities917(55)
Provision for deferred income taxes67844
Changes in operating assets and liabilities:
Accounts receivable(19,790)(4,195)
Other receivables(431)205
Prepaid expenses and other current assets(357)(319)
Other assets85187
Accounts payable22,2804,332
Accrued liabilities9,602285
Deferred rent(24)
Income taxes receivable/payable1,045(330)
Net cash used in operating activities(7,701)(3,738)
Cash flows from investing activities:
Purchases of intangible assets(25)
Purchases of property and equipment(1,245)(686)
Net cash used in investing activities(1,270)(686)
Cash flows from financing activities:
Borrowings on bank loans41,95529,220
Repayments on bank loans(30,248)(24,297)
Payment of financing fees(720)(50)
Borrowings on notes payable95
Repayments on notes payable(160)(469)
Proceeds from exercise of stock options236
Payment of expenses related to issuance of common stock(164)
Net cash provided by financing activities10,7584,640
Effects of foreign currency exchange rate changes on cash41(46)
Net increase in cash1,828170
Cash, beginning of period5,1421,496
Cash, end of period$6,970$1,666
Supplementary Data
Adjusted EBITDA (Loss) Reconciliation (non-GAAP)
(in thousands)
Three Months
Ended September 30,
Six Months
Ended September 30,
Net loss($1,611)($922)($5,576)($2,167)
Depreciation and amortization5525801,0381,096
Stock-based compensation124117262240
Change in fair value of warrant liabilities871(74)917(55)
Interest expense, net364167621325
Income tax expense1,091211,0644
Adjusted EBITDA (loss)$1,391($111)($1,674)($557)
Adjusted EBITDA (loss), a non-GAAP (“Generally Accepted Accounting Principles”) financial measure, represents net loss before interest, taxes, depreciation and amortization, stock-based compensation and change in the fair value of warrant liabilities. Adjusted EBITDA is not intended to represent cash flows for the period, nor is it being presented as an alternative to operating or net loss as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. As defined, Adjusted EBITDA is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. Our management believes, however, that in addition to the performance measures found in our financial statements, Adjusted EBITDA is a useful financial performance measurement for assessing our Company’s operating performance. Our management uses Adjusted EBITDA as a measurement of operating performance in comparing our performance on a consistent basis over prior periods, as it removes from operating results the impact of our capital structure, including the interest expense resulting from our outstanding debt, and our asset base, including depreciation and amortization of our capital and intangible assets. In addition, Adjusted EBITDA is an important measure for our lender.
CONTACT: Karen McGinnis
         Chief Financial Officer
         Mad Catz Interactive, Inc.
         [email protected] or (858) 790-5040
         Joseph Jaffoni, Norberto Aja, Jim Leahy
         [email protected] or (212) 835-8500

Talking Blizzcon With Michele Morrow

Talking Blizzcon With Michele Morrow 3

With Blizzcon kicking off, all eyes will be on Michele Morrow, who will be co-hosting the Virtual Ticket, Blizzcon’s answer to the question “what if I want to attend Blizzcon from the comfort of my couch?” Michele Morrow started her career as a horror movie actress, with more than a dozen titles to her name, and when she made the leap from horror to gaming she quickly rose to the top as one of the most in-demand hosts for video games and nerd culture. CGMagazine sat down to talk to her about her role as Alleria Windrunner, as well as her experiences with hosting Blizzcon’s Virtual Ticket.

Michele Morrow - Photo Credit, Isaac Sterling (7)CGMagazine: So, just to begin, tell me a little about your career. How did you get started and what made you want to go from being an actress to getting into voice acting?

Michele: Well I’ve done voice acting for many years; I booked commercials and stuff back in maybe the mid-2000’s. I moved to LA in 2000 and just did some voice over acting, a bunch of different stuff, but it wasn’t until about 2007 that I had a really bad accident and unfortunately was in a neck brace for about a year. I had a small fracture in a facet joint and I had a really bad sprain. So they removed my first rib, and it made it so I couldn’t really do anything, so I got really into video games. I started playing a lot more (I played a lot as a kid, but I kind of rediscovered them) and got back into gaming. So that sort-of led to more video game voice overs as opposed to just commercial voice overs. 

CGMagazine: What was it like voicing Alleria Windrunner? Were there other influences within the Blizzard universe that you wanted to model or did you bring your own thing to her?

Michele: Well Alleria is one of my favorite characters in all of Blizzard lore, so to be able to voice her in Hearthstone was just a dream come true. And I mean, I auditioned for it, I went through many phases of it, they changed the way they wanted her to sound a few times so we went through the direction. Alleria is a character who really hates orcs, she’s extremely rebellious and cocky, she’s a master marksman so you really have to bring a little bit more of that grit. She is a High-Elf so normally you’d have a little bit more of that regal sense about her; she still has that regality but she’s been missing for a very long time from the universe. This is her very first appearance…ever, really since Warcraft 2, so it’s really cool to give her life and bring my own spin to it, but also what Warcraft and the directors wanted from it.

CGMagazine: Do you feel you reflect a little bit of Alleria’s personality?

Michele: I mean, I like to think so! You know, her sister Sylvanas Windrunner is what really got me attached to World of Warcraft. That was the original thing, because Sylvanas had lost her body. She was the banshee queen and she had gone to great lengths to get her body back. So that was a story that really resonated with me because at the time, I was in a neck brace, at home, banished to a life on the couch. So I would read Sylvanas’ story and I found it to be really inspirational. And I really liked her, and I attached to her greatly; so when it’s the opportunity to voice her older sister who has been missing from the lore, who Sylvanas loved so much, and has done so much for Azeroth it was a great honor. I think we did a really great job on it and I’m excited about it.

CGMagazine: And are you, potentially, going to voice any other characters in the Blizzard universe?

Michele: I sure hope so! I mean, the new expansion is coming out, but they haven’t announced any kind of castings or anything like that, so we’re just kind-of waiting to know that stuff. But, yeah I would voice anything in the Blizzard universe and all the games! I’m a huge fan, as well as I’ve hosted conventions but I’m just such a massive fan. And it’s just exciting to do!

CGMagazine: You gotta keep your ears open for that Starcraft: Ghost resurrection.

Michele: Right!? That would be great. Not many people know about that little thing.

Alleria Windrunner - Hearthstone
Alleria Windrunner – Hearthstone

CGMagazine: So tell me a little bit about your experiences with Blizzcon. Did you go there before you were a host?

Michele: Oh yeah! I was a huge fan, so it was really weird because I love co-hosting the Virtual Ticket, for sure, it’s a great time! I get to interview every major dev and just really be in the middle of the action. Last year was my first year; this year will be my returning year, and one of the things I really miss is just being able to go the panels. I mean, I can watch them, but there’s a certain charm to being there. Like, I was there for Red Shirt Guy at the lore panel! There were things where I would go every year. I think I started going in 2009. So just as a fan, moving over to the host position was a dream come true. I was actually in the middle of a raid the first time I found out that I had actually been accepted to host. I thought for sure I wasn’t going to get it, and I did and everything changed.

CGMagazine: Well that leads in perfectly to my next question: what’s it like hosting the Virtual Ticket?Michele Morrow - PHOTO CREDIT: ISAAC STERLING

Michele: It’s a lot of work; it really is. We have a lot of developers who come up to the desk and we have community members coming up, too. We want to make sure we cover every single game; that we answer the community’s questions, making sure we’re covering everything about the franchises and asking intelligent questions to everybody that comes up to the desk. So there’s a lot of preparation that goes into it. Pretty much my life for the past month, my “job,” has been playing video games non-stop; which is totally fine with me! So it’s been a lot of prep, and when you’re actually on it and doing it, I mean this is old-hat for me, I’m used to it, being broadcasted live is not something I’m totally unfamiliar with, so this was a very easy transition coming from the acting side of things, and the improv side of things. I had been hosting for a little while with different outlets, so to go into this was not too far of a jump for me. The broadcast part isn’t difficult, but the prep and planning…I’m such a perfectionist with all of it. I love the lore and all the games and all the IPs and everybody who works there, so I just want to do the best job I can.

CGMagazine: As well as conventions, do you enjoy hosting eSports events? Would you do more? Are there any more that you’re going to be a part of?

Michele: Well, there are some things I can’t talk about, but I will say that hosting Heroes of the Dorm on ESPN2 in April was life-changing. It was changing for me; it was life-changing for eSports in general, at least here in America. We finally saw live collegiate eSports on television, on a major network! They had shown canned parts of Dota 2 on there, so that had been done before, but not quite at this level. This level of hitting into the mainstream was fascinating. And seeing the reaction from the people back home, because people back home would turn on ESPN2 and they’re like, “so why is there a dragon fighting on my screen?” It was awesome to read through the tweets and see how everyone was engaging and people would say, “I don’t know what the hell I’m watching, but I can’t takes my eyes off it!” And that’s people who don’t even know what the game is. The people who know what the game is were losing their minds!

So standing backstage on the finals, game five, it was UC Berkeley vs. Arizona and they ended up picking up a very unlikely hero, The Lost Vikings, and I’ve never seen the game director Dustin Browder so excited; he was just jumping up and down with excitement at the fact that The Lost Vikings had been chosen. So it’s interesting to see these students who are all competing for their college tuition and it was cool to see them really get into it and find different metas within the game, be excited about it, and the whole deal. I think eSports is going to BLOW UP in 2016. And I’d be stoked to be a part of it.

The Epic Full Length WarCraft Trailer is Here

The Epic Full Length WarCraft Trailer is Here 3

The Warcraft movie has been in development for a while now, in production since 2014, the film is planned to be a fantasy epic. Telling the story of the epic war between Orcs and Humans, the film directed by Duncan Jones is sure to be a feast for the eyes.

This week, Legendary Pictures gave us the first taste of what the film will look like, now they have let loose the full trailer. Filed with as much action as you would expect in 2:14 minutes, it gives us a better feel for what the full length movie will be like.

I know I am excited, finally a videogame based movie that has a budget, a good director and a level of quality sorely lacking from all but few films in the genre. Let’s hope the final product is as exciting as the trailer was.