1). BALANCE SHEETS
2). INCOME STATEMENTS
3). SHAREHOLDER'S EQUITY
4). STATEMENTS OF CASH FLOW
Please note that these year-end results reflect adjustments made following the 2012 / 2013 audits (including changes in capitalization of expenses, realization of officer deferrals, allowances for deferred income taxes and adjustments for net sales vs. gross shipments, as described in the Form 10). Also, please note that the formatting of this Google-hosted BLOG may have some of the financial columns askew. Assuredly, the 10k report and financials will align perfectly when published through the appropriate channels.
The 2014 results show a modest increase in both sales and profits over 2013, and both years reflect the "old" business model of only having a limited number of DVD / BluRay releases. Activity in 2015 for Hannover House - with the locomotive strength of six studios combined under Medallion Releasing - will show a far more robust dynamic and impressive results.
* * * * *
| Hannover House, Inc. | |||||
| Consolidated Balance Sheet | |||||
| At December 31, | |||||
| 2013 | 2014 | ||||
| ASSETS | |||||
| CURRENT ASSETS | |||||
| Cash & Cash Equivalents | $ | 1,476 | 16,125 | ||
| Accounts Receivable, Net | 2,713,351 | 2,878,972 | |||
| Prepaid Wages | 0 | 0 | |||
| Merchandise Inventory | 166,420 | 198,215 | |||
| Prepaid Advertising | 765,000 | 765,000 | |||
| Prepaid Producer Royalties | 1,637,941 | 2,138,178 | |||
| Producer Marketing Recoupment | 2,398,038 | 2,217,739 | |||
| Film Distribution Rights | 2,036,379 | 1,986,379 | |||
| Film Production Investments | 236,633 | 243,083 | |||
| Notes Receivable and Net Recoupment | - | - | |||
| TOTAL CURRENT ASSETS | 9,955,238 | 10,443,691 | |||
| PROPERTY & EQUIPMENT | |||||
| Office Furnishings, Equipment & Film Gear | 155,081 | 155,081 | |||
| Less Accumulated Depreciation | (39,356) | (39,356) | |||
| Vehicles | 22,500 | 22,500 | |||
| Less Accumulated Depreciation | (5,000) | (7,500) | |||
| Real Property | 0 | 0 | |||
| TOTAL PROPERTY & EQUIPMENT | 133,225 | 130,725 | |||
| OTHER ASSETS | |||||
| FILM & TELEVISION LIBRARY | 22,315,337 | 22,315,337 | |||
| TOTAL OTHER ASSETS | 22,315,337 | 22,315,337 | |||
| $ | 32,403,800 | 32,889,753 | |||
| LIABILITIES & SHAREHOLDER'S EQUITY | |||||
| 2013 | 2014 | ||||
| CURRENT LIABILITIES | |||||
| Accounts Payable | $ | 148,522 | 107,522 | ||
| Accrued Royalties | 303,829 | 220,406 | |||
| Acquisition Advances Due | 187,450 | 41,000 | |||
| Accrued Wages | 0 | 20,760 | |||
| Payroll Taxes Payable | 5,585 | 23,847 | |||
| Deferred Income Tax Payable | 732,598 | 1,044,108 | |||
| NB Cal AFIL P&A Loan | 316,478 | 249,306 | |||
| Hounddog P&A Note (Weinreb) | 731,025 | 731,025 | |||
| Interest on Weinreb note | 139,437 | 200,369 | |||
| Graham Financial Service note | 80,000 | 80,000 | |||
| Interest on Graham note | 11,592 | 3,268 | |||
| Bank of Fayetteville note | 15,000 | 15,000 | |||
| Interest on B.O.F. note | 3,582 | 4,604 | |||
| TOTAL CURRENT LIABILITIES | 2,675,098 | 2,741,215 | |||
| LONG-TERM LIABILITIES | |||||
| Long-Term Payables | 2,378,991 | 2,168,536 | |||
| TCA Global Master Fund | 300,000 | 314,384 | |||
| Mortgage Note Payable | 0 | 0 | |||
| Executive Salary Deferrals | 843,561 | 488,561 | |||
| Officer Notes Payable | 137,913 | 201,455 | |||
| TOTAL LONG-TERM LIABILITIES | 3,660,465 | 3,172,936 | |||
| TOTAL OF ALL LIABILITIES | 6,335,563 | 5,914,151 | |||
| SHAREHOLDER'S EQUITY | |||||
| Common Stock | 25,020,646 | 25,349,493 | |||
| Retained Earnings | 1,047,591 | 1,626,109 | |||
| TOTAL SHAREHOLDER'S EQUITY | 26,068,237 | 26,975,602 | |||
| $ | 32,403,800 | 32,889,753 |
_______________________________________________________________
| HANNOVER HOUSE, INC. | |||||||||
| CONSOLIDATED STATEMENT OF INCOME | |||||||||
| FOR THE YEARS ENDED DECEMBER 31, | |||||||||
| 2012 | 2013 | 2014 | |||||||
| REVENUES | $ | 2,373,065 | $ | 2,677,061 | $ | 2,802,392 | |||
| COST OF SALES | |||||||||
| Commisions | 50,140 | 10,000 | 170 | ||||||
| Sales and marketing | 28,438 | 9,416 | 19,836 | ||||||
| Video manufacturing | 27,148 | 22,177 | 43,537 | ||||||
| Film and Book Royalties | - | 27,623 | 83,498 | ||||||
| Freight | 21,103 | 12,738 | 8,199 | ||||||
| Other expenses | 1,073,901 | 1,564,403 | 1,337,760 | ||||||
| TOTAL COST OF SALES | 1,200,730 | 1,646,357 | 1,493,000 | ||||||
| GROSS PROFIT | 1,172,335 | 1,030,704 | 1,309,392 | ||||||
| GENERAL AND ADMINISTRATIVE EXP. | 428,118 | 330,695 | 318,744 | ||||||
| INCOME FROM OPERATIONS | 744,217 | 700,009 | 990,648 | ||||||
| OTHER INCOME(EXPENSE) | - | (409) | (100,620) | ||||||
| INCOME BEFORE INCOME TAXES | 744,217 | 699,600 | 890,028 | ||||||
| PROVISION FOR INCOME TAXES | 290,245 | 272,844 | 311,510 | ||||||
| NET INCOME | $ | 453,972 | $ | 426,756 | $ | 578,518 | |||
______________________________________________________________________
| Hannover House, Inc. | |||||||
| Statement of Changes in Stockholder Equity | |||||||
| Common Stock | Retained | ||||||
| Shares | Amount | Earnings | Total | ||||
| Balance at December 31, 2012 | 489,965,532 | $ 24,951,053 | $ 620,835 | $ 25,571,888 | |||
| - | 69,593 | ||||||
| Net Income | 426,756 | 426,756 | |||||
| Balance at December 31, 2013 | 583,732,365 | 25,020,646 | 1,047,591 | 26,068,237 | |||
| - | 328,847 | ||||||
| Net Income | 578,518 | 578,518 | |||||
| Balance at December 31, 2014 | 663,227,212 | $ 25,349,493 | $ 1,626,109 | $ 26,975,602 | |||
_________________________________________________________________________________
| Hannover House, Inc. | ||||||||
| Consolidated Statement of Cash Flow | ||||||||
| For the year ended December 31, | ||||||||
| 2013 | 2014 | |||||||
| Cash flows from operating activities | ||||||||
| Net Income | $ | 426,756 | $ | 578,518 | ||||
| Adjustments to reconcile net income | ||||||||
| to cash provided by (used in) | ||||||||
| operations | ||||||||
| Depreciation | (5,000) | - | ||||||
| Accounts receivable | (926,747) | (165,621) | ||||||
| Inventory | (34,110) | (31,785) | ||||||
| Prepaid advertising | - | 180,299 | ||||||
| Producer marketing recoupment | 147,569 | (500,237) | * | |||||
| Prepaid producer royalties | 97,326 | (522,447) | ||||||
| Film distribution rights | 10,000 | 40,000 | ||||||
| Accounts payable | (317,384) | (41,000) | ||||||
| Weinreb P&A interest | (49,283) | (60,932) | ||||||
| Graham Financial interest | (5,992) | 8,324 | ||||||
| Bank of Fayetteville Interest | (969) | (1,022) | ||||||
| Long Term Payables | 303,071 | (210,455) | ||||||
| Real Estate Mortgage Payable | - | - | ||||||
| TCA Global Master Fund | (300,000) | (14,384) | ||||||
| Accrued royalties | 6,487 | 83,423 | ||||||
| Deferred income tax payable | 272,844 | 311,510 | ||||||
| Accrued wages | 8,670 | 20,760 | ||||||
| Payroll taxes due | (22,515) | 18,262 | ||||||
| Executive salary deferral | (80,000) | (355,000) | ||||||
| Cash used in operations | (469,277) | (661,787) | ||||||
| Cashflows from investing activities | ||||||||
| Film production investments | 31,450 | 56,155 | ||||||
| Furnishings, Equipment, Truck | 1,903 | (19,052) | ||||||
| Weinreb / Hounddog P&A note | - | - | ||||||
| Graham Financial Services note | - | - | ||||||
| Bank of Fayetteville note | - | - | ||||||
| Acquisition Advances Payable | 428,530 | 183,717 | ||||||
| NB Cal loan (AFIL) | (37,266) | (67,172) | ||||||
| Real Estate Valuation | - | 150,000 | ||||||
| Officer notes payable | 45,000 | 83,549 | ||||||
| Cash provided by investing activities | 469,617 | 387,197 | ||||||
| Cash flows from financing activities | ||||||||
| (See Supplemental Information Note) | - | 289,239 | ||||||
| Increase in cash | 340 | 14,649 | ||||||
| Cash, beginning of period | 1,136 | 1,476 | ||||||
| Cash, end of period | $ | 1,476 | $ | 16,125 | ||||
| * Producer Marketing Recoupment includes journal-entry adjustment for unrecouped P&A | ||||||||
| incurred for the release of the film "TWELVE." | ||||||||
