AIX Access Integr Tech A

Revenue Growth Continues, $9.3 Million Debt Conversion Strengthens Balance Sheet MORRISTOWN, N.J., Nov. 14 /PRNewswire-FirstCall/ -- Access Integrated Technologies, Inc. ("AccessIT" or the "Company") (AMEX:AIX) today reported revenues of $3,902,000, an EBITDA(1) (defined below) loss of $1,051,000 and a net loss of $2,698,000 or a loss of $0.21 per diluted share, excluding one-time debt conversion expenses and related charges for its second quarter ended September 30, 2005. The Company converted our $7.6 million 7 percent convertible debentures and our $1.7 million 6 percent convertible debentures into equity which was accompanied by one-time non-cash expenses totaling $6,562,000 or $0.50 per share. With this change, the loss came to $9,260,000 or $0.71 per share. Second Fiscal Quarter Highlights * Quarterly revenues increased by 78.6%, to $3,902,000 from $2,185,000 in the comparable year ago period. Revenues for the six months ended September 30, 2005 also increased by 79.1%, to $7,873,000, from $4,396,000 in the comparable year ago period. * Quarterly net loss available to common stockholders was $9,260,000 compared to a loss of $1,705,000 in the comparable year ago period. Net loss available to common stockholders for the six months ended September 30, 2004 was $11,750,000 compared to a loss of $2,671,000 in the comparable year ago period. The loss reported in both the three and six months ended included the impact of increased interest and non-cash interest expenses and the early conversion of the company's outstanding $7.6 million, 4-year Convertible Debentures and exercise of all related common stock warrants. Collectively, these items accounted for $7,033,000 and $7,650,000 for the three and six month periods, respectively. * EBITDA for the three and six month periods ended September 30, 2005 was a loss of $1,051,000, and $1,575,000, respectively, compared to EBITDA losses of $828,000, and $893,000 in the comparable year ago periods. Adjusted EBITDA(1) (defined below), which also excludes non-cash stock based compensation and non-recurring items, for the three and six month periods ended September 30, 2005 was unchanged from EBITDA and Adjusted EBITDA in the comparable prior year periods was a loss of $329,000 and $390,000. * Loss from operations in the September 2005 quarter was $2,386,000, compared to a loss of $1,682,000 in the September 2004 quarter. Loss from operations for the six months ended September 2005, was $4,323,000, compared to a loss of $2,581,000 in September 2003. The increase was due to higher selling, general and administrative expenses due to increased headcount and office expenses; public company expenses; research & development; and to higher depreciation and amortization resulting from the increased asset base. Bud Mayo, Chief Executive Officer of AccessIT, stated: "During the second quarter, AccessIT achieved many objectives that will very significantly help define the future of its business. In August, the company announced its first studio commitment, securing the invaluable support of Disney for our digital rollout plan. Based upon this commitment and the high-level of interest expressed by other studios and exhibitors, we expanded our original plan to now reach 4,000 screens. In a further commitment to investing in the long-term future of the company, we redeemed all of our outstanding convertible debt and related warrants, greatly strengthening our balance sheet while generating approximately $2.5 million in cash. Lastly, but certainly not least, we were joined by Chuck Goldwater former CEO of Hollywood's digital cinema consortium, Digital Cinema Initiatives. As President and CEO of our newly formed Christie/AIX subsidiary, Chuck's longtime personal relationships with industry leaders and in-depth knowledge of the business of Hollywood is a major asset, allowing us to accelerate our efforts to bring digital cinema to audience nationwide." CONFERENCE CALL NOTIFICATION AccessIT will host a conference call to discuss its financial results at 10:30 a.m. EST today, Monday, November 14, 2005. The conference can be accessed by dialing 617-597-5342, passcode 79934430 at least five minutes before the start of the call. The conference call will also be webcast simultaneously and will be accessible via the web on AccessIT's Web site, http://www.accessitx.com/. A replay of the call will be available at 617-801-6888, passcode 39695082 through Tuesday, November 22, 2005. Access Integrated Technologies, Inc. (AccessIT) is an industry leader in offering a fully managed storage and electronic delivery service for owners and distributors of digital content to movie theaters and other venues. Supported by its robust platform of fail-safe Internet data centers, AccessIT is able to leverage the market-leading role of its Theatrical Distribution System (TDS) with its innovative digital delivery capabilities and in-theatre software systems to provide the highest level of technology available to enable the emerging Digital Cinema industry to transition from film without changing workflows. For more information on AccessIT, visit http://www.accessitx.com/. Safe Harbor Statement Investors and readers are cautioned that certain statements contained in this document, as well as some statements in periodic press releases and some oral statements of AccessIT officials during presentations about AccessIT, along with AccessIT 's filings with the Securities and Exchange Commission, including AccessIT 's registration statements, quarterly reports on Form 10-QSB and annual report on Form 10-KSB, are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Forward-looking statements include statements that are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "expects," "anticipates," "intends," "plans," "could," "might," "believes," "seeks," "estimates" or similar expressions. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible future actions, which may be provided by AccessIT's management, are also forward-looking statements as defined by the Act. Forward-looking statements are based on current expectations and projections about future events and are subject to various risks, uncertainties and assumptions about AccessIT, its technology, economic and market factors and the industries in which AccessIT does business, among other things. These statements are not guarantees of future performance and AccessIT undertakes no specific obligation or intention to update these statements after the date of this release. (1) EBITDA is defined by the Company to be earnings before interest, taxes, depreciation and amortization, and other income/(expense), net, and non-recurring items. Adjusted EBITDA is defined by the Company to be earnings before interest, taxes, depreciation and amortization, other income/(earnings), net, non-recurring items, and non-cash stock-based compensation. EBITDA and Adjusted EBITDA are presented because management believes it provides additional information with respect to the performance of its fundamental business activities. A reconciliation of EBITDA to GAAP net income is included in the table attached to this release. EBITDA is a measure of cash flow typically used by many investors, but is not a measure of earnings as defined under Generally Accepted Accounting Principles, and may be defined by others. Contact: Suzanne Tregenza Moore Michael Glickman AccessIT The Dilenschneider Group 55 Madison Avenue 212.922.0900 Suite 300 Morristown, NJ 07960 973.290.0080 http://www.accessitx.com/ ACCESS INTEGRATED TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except for share and per share data) (unaudited) Three Months Ended September 30, 2004 2005 Revenues: Media services $ 661 $ 2,266 Data center services 1,524 1,636 Total revenues 2,185 3,902 Costs of revenues (exclusive of depreciation and amortization shown below): Media services 219 1,686 Data center services 1,031 1,206 Total costs of revenues 1,250 2,892 Gross profit 935 1,010 Operating expenses: Selling, general and administrative 1,182 2,041 Provision for doubtful accounts 527 12 Research and development 120 154 Depreciation and amortization 788 1,189 Total operating expenses 2,617 3,396 Loss from operations (1,682) (2,386) Interest income -- 81 Interest expense (91) (1,091) Non-cash interest expense (66) (1,109) Debt conversion expense -- (6,083) Other expense, net 56 1,250 Loss before income tax benefit (1,783) (9,338) Income tax benefit 78 78 Net loss $ (1,705) $ (9,260) Net loss available to common stockholders per common share: Basic and diluted $ (0.18) $ (0.71) Weighted average number of common shares outstanding: Basic and diluted 9,586,018 13,047,151 Access Integrated Technologies, Inc. EBITDA and Adjusted EBITDA (as defined) Reconciliation to GAAP Net Income (In thousands) (unaudited) Three Months Ended September 30, September 30, 2004 2005 Net loss $(1,705) $(9,260) Add Back: Depreciation and amortization 788 1,189 Amortization of software development 66 146 Interest income -- (81) Interest expense 91 1,091 Non-cash interest expense 66 1,109 Income tax benefit (78) (78) Debt conversion expense -- 6,083 Other expense, net (56) (1,250) EBITDA (as defined) $ (828) $(1,051) Add Back: Non-cash stock-based compensation -- -- Provision for customer related unbilled revenue 499 -- Adjusted EBITDA (as defined) $ (329) $(1,051) ACCESS INTEGRATED TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except for share and per share data) (unaudited) Six Months Ended September 30, 2004 2005 Revenues: Media services $ 1,196 $ 4,626 Data center services 3,200 3,247 Total revenues 4,396 7,873 Costs of revenues (exclusive of depreciation and amortization shown below): Media services 342 3,334 Data center services 2,040 2,295 Total costs of revenues 2,382 5,629 Gross profit 2,014 2,244 Operating expenses: Selling, general and administrative 2,286 3,792 Provision for doubtful accounts 576 35 Research and development 167 287 Non-cash stock-based compensation 4 -- Depreciation and amortization 1,562 2,453 Total operating expenses 4,595 6,567 Loss from operations (2,581) (4,323) Interest income -- 83 Interest expense (188) (1,524) Non-cash interest expense (113) (1,293) Debt conversion expense -- (6,083) Other expense, net 45 1,234 Loss before income tax benefit and minority interest (2,837) (11,906) Income tax benefit 156 156 Net loss before minority interest in subsidiary (2,681) (11,750) Minority interest in loss of subsidiary 10 -- Net loss $ (2,671) $ (11,750) Net loss available to common stockholders per common share: Basic and diluted $ (0.29) $ (1.00) Weighted average number of common shares outstanding: Basic and diluted 9,304,008 11,730,966 Access Integrated Technologies, Inc. EBITDA and Adjusted EBITDA (as defined) Reconciliation to GAAP Net Income (In thousands) (unaudited) Six Months Ended September 30, September 30, 2004 2005 Net loss $(2,671) $(11,750) Add Back: Depreciation and amortization 1,562 2,453 Amortization of software development 126 296 Interest income -- (84) Interest expense 188 1,524 Non-cash interest expense 113 1,293 Income tax benefit (156) (156) Minority interest (10) -- Debt conversion expense -- 6,083 Other expense, net (45) (1,234) EBITDA (as defined) $ (893) $ (1,575) Add Back: Non-cash stock-based compensation 4 -- Provision for customer related unbilled revenue 499 -- EBITDA (as defined) $ (390) $ (1,575) Access Integrated Technologies, Inc. Consolidated Balance Sheets (In thousands, except share data) (unaudited) March 31, September 30, 2005 2005 Assets Current assets Cash and cash equivalents $ 4,779 $14,136 Accounts receivable, net 947 1,034 Prepaid and other current assets 762 667 Unbilled revenue 550 1,119 Total current assets 7,038 16,956 Property and equipment, net 14,261 19,341 Intangible assets, net 3,337 2,544 Capitalized software costs, net 1,622 1,428 Goodwill 10,363 9,310 Deferred costs 726 217 Unbilled revenue, net of current portion 69 53 Security deposits 361 386 Total assets $37,777 $50,235 Liabilities, redeemable stock and stockholders' equity Current liabilities Accounts payable and accrued expenses $ 2,415 $ 3,873 Current portion of notes payable 1,415 1,174 Current portion of customer security deposits 116 194 Current portion of capital leases 432 191 Current portion of deferred revenue 884 819 Current portion of deferred rent expense 42 39 Total current liabilities 5,304 6,290 Notes payable, net of current portion 12,682 2,193 Common stock warrants -- 3,490 Customer security deposits, net of current portion 161 88 Deferred revenue, net of current portion 95 80 Capital leases, net of current portion 6,058 6,029 Deferred rent expense, net of current portion 970 984 Deferred tax liability 1,210 1,053 Total liabilities 26,480 20,206 Commitments and contingencies Redeemable Class A common stock, issued and outstanding 53,534 and 0 shares, respectively 250 -- Stockholders' Equity: Class A common stock, $0.001 par value per share; 40,000,000 shares authorized; shares issued 9,433,328 and 14,422,905, respectively shares outstanding -9,381,888 and 14,371,465, respectively 9 14 Class B common stock, $0.001 par value per share; 15,000,000 shares authorized; shares issued and outstanding, 965,811 and 925,811 shares, respectively 1 1 Additional paid-in capital 32,696 63,424 Treasury Stock, at cost; 51,440 shares (172) (172) Accumulated deficit (21,487) (33,238) Total stockholders' equity 11,047 30,029 Total Liabilities, Redeemable Stock and Stockholders' Equity $37,777 $50,235 DATASOURCE: Access Integrated Technologies, Inc. CONTACT: Suzanne Tregenza Moore of AccessIT, +1-973-290-0080; or Michael Glickman of The Dilenschneider Group for AccessIT, +1-212-922-0900 Web site: http://www.accessitx.com/

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