Record results and significant operational progress in 2020 set the stage for a strong 2021

COS COB, CT – Chicken Soup for the Soul Entertainment, Inc. (Nasdaq: CSSE), one of the largest operators of streaming advertising-supported video-on-demand (AVOD) networks, today announced its financial results for the fourth quarter and full year ended December 31, 2020.

“The fourth quarter capped off a very successful 2020 as we continued to deliver growth in original and exclusive content on Crackle Plus and expanded our distribution to drive viewership growth into the future,” said William J. Rouhana Jr., chairman and chief executive officer of Chicken Soup for the Soul Entertainment. “Our strong 2020 results set the stage for what is shaping up to be a year of transformational growth in 2021. Our Distribution and Production business grew over 200% year-over-year and Crackle has seen strong viewership increases in the first quarter with continued increases in viewership of our original and exclusive content.”

“We are positioning Chicken Soup for the Soul Entertainment as a pure play AVOD network operator with a rich trove of content assets, differentiated production capabilities, a deep pipeline of exciting new original and exclusive content, and viewership that we expect to continue growing throughout the year as our new distribution touchpoints deliver results. We are building momentum toward our goal of creating the best AVOD experience.”

Fourth Quarter 2020 Financial Summary

• Gross revenue of $20.2 million, compared to $20.0 million in the third quarter of 2020, and $24.8 million in the year-ago period.
• Online Networks, which include Crackle and Popcornflix, gross revenue of $10.8 million, up 35% from $8.0 million in the third quarter of 2020, and compared to $15.9 million in the year-ago period. Gross revenue included intercompany revenue share payments of $1.7 million, $1.3 million, and $1.0 million, respectively. On a comparable basis, after the deduction of $5.6 million of revenue from the since-shuttered Playstation Vue, the year-over-year gross revenue grew from $10.1 million to $10.8 million, an increase of 7%.
• Distribution and Production revenue of $11.1 million compared to $13.3 million in the third quarter of 2020, and $9.9 million in the year-ago period.
• Net loss of $10.1 million compared to a net loss of $13.0 million in the third quarter of 2020, and a net loss of $12.4 million in the year-ago period; $8.9 million net loss before preferred dividends, compared to $12.1 million net loss in the third quarter 2020, and $11.4 million net loss before preferred dividends in the year-ago period.
• Adjusted EBITDA of $2.8 million, compared to $4.2 million in the third quarter 2020, and $5.9 million in the year-ago period.

Full Year 2020 Financial Summary

• Record gross revenue of $68.2 million, compared to $56.6 million in 2019.
• Online networks generated $35.3 million in gross revenue compared to $41.7 million in 2019. Gross revenue included intercompany revenue share payments of $5.2 million and $1.7 million, respectively. On a comparable basis, after the deduction of $0.3 million and $15.9 million of revenue from the since-shuttered Playstation Vue, the year-over-year gross revenue grew from $25.8 million to $35.0 million, an increase of 36%.
• Distribution & Production gross revenue was $38.0 million in revenue compared to $16.6 million in 2019.
• Net loss of $44.6 million compared to $35.0 million in 2019; $40.4 million net loss before preferred dividends, compared to $31.7 million net loss before preferred dividends in 2019.
• Adjusted EBITDA was $11.8 million, compared to $6.0 million in 2019.

Recent Business Highlights

• Continued to expand pipeline of Original & Exclusive content which represented nearly 20.0% of ad impressions for the fourth quarter and 18.5% for full year 2020.
• Increased distribution of Crackle Plus AVOD networks to 41 touchpoints and expanding this initiative with plans to reach a total of 64 consumer touchpoints.
• Signed agreement for Crackle-branded button to be included on approximately 2.5 million VIZIO SmartCast TV remotes in 2021.
• Obtained 100% ownership of Crackle Plus from Sony Pictures Television, strengthening relationship and positioning company for further growth.
• Strengthened balance sheet and enhanced liquidity with additional equity and long-term debt without covenants.

Gross profit for the year ended December 31, 2020 was $14.2 million, or 21% of net revenue, compared to $14.9 million, or 27% of net revenue in 2019.

Operating loss for the year ended December 31, 2020 was $44.3 million compared to an operating loss of $26.1 million in in 2019.

Net loss for the year ended December 31, 2020 was $44.6 million, or $3.62 per share, compared to a net loss of $35.0 million, or $2.92 per share, in the prior year. Excluding preferred dividends, the net loss in 2020 was $40.4 million, or $3.29 per share, compared to net loss of $31.7 million, or $2.64 per share, in the prior year.

Adjusted EBITDA for the year ended December 31, 2020 was $11.8 million, compared to $6.0 million in 2019.

As of December 31, 2020, the company had $14.7 million of cash and cash equivalents compared to $6.4 million at December 31, 2019, and outstanding debt of $33.6 million as of December 31, 2020 compared to $20.0 million as of December 31, 2019.

For a discussion of the financial measures presented herein which are not calculated or presented in accordance with U.S. generally accepted accounting principles (“GAAP”), see “Note Regarding Use of Non-GAAP Financial Measures” below and the schedules to this press release for additional information and reconciliations of non-GAAP financial measures.

The company presents non-GAAP measures such as Adjusted EBITDA and Pro Forma Adjusted EBITDA to assist in an analysis of its business. These non-GAAP measures should not be considered an alternative to GAAP measures as an indicator of the company's operating performance.