UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

 

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): September 2, 2020

 

 

 

ZEDGE, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   1-37782   26-3199071

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(IRS Employer

Identification No.)

 

22 Cortlandt Street (14th Floor), New York, NY   10007
(Address of principal executive offices)   (Zip Code)

 

Registrant’s telephone number, including area code: (330) 577-3424 

 

Not Applicable

(Former name or former address, if changed since last report.)

 

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Securities registered pursuant to Section 12(b)-2 of the Exchange Act:

 

Title of each class   Trading Symbol   Name of each exchange on which registered
Class B common stock, par value $.01 per share   ZDGE   NYSE American

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company ☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

 

 

Item 7.01 Regulation FD.

 

The slide presentation (the “Presentation”) attached hereto as Exhibit 99.1 will be provided to certain investors.

 

The Registrant is furnishing the information contained in this Report, including Exhibit 99.1, pursuant to Item 7.01 of Form 8-K promulgated by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC. In addition, the Presentations contain statements intended as “forward-looking statements” that are subject to the cautionary statements about forward-looking statements set forth in the Presentations. 

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.

  Document
99.1   Investor Presentation

 

1

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  ZEDGE, INC.
     
  By:

/s/ Jonathan Reich

  Name:   Jonathan Reich
  Title: Chief Executive Officer

 

Dated: September 2, 2020

 

2

 

 

EXHIBIT INDEX

 

Exhibit
Number

  Document
99.1   Investor Presentation

 

 

3

 

 

Exhibit 99.1

 

is the app you’ve never heard of with ~30 million monthly active users. Company Overview September 2020 ZEDGE, Inc. 2020

 

 

ZEDGE, Inc. 2020 This presentation contains statements that are, or may be considered to be, forward - looking statements. All statements that are not historical facts are forward - looking statements and such forward - looking statements are statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Examples of forward - looking statements include: • statements about Zedge’s future performance; • projections of Zedge’s results of operations or financial condition; • statements regarding Zedge’s plans, objectives or goals, including those relating to its strategies ,initiatives, competition, acquisitions, dispositions and/or its products; and Words such as "believe," "anticipate," "plan," "expect," "intend," "target," "estimate," "project," "predict," "forecast," "guideline," "aim," "will," "should," “likely,” "continue" and similar expressions are intended to identify forward - looking statements but are not the exclusive means of identifying such statements. Readers are cautioned not to place undue reliance on these forward - looking statements and all such forward - looking statements are qualified in their entirety by reference to the following cautionary statements. Forward - looking statements are based on Zedge’s current expectations, estimates and assumptions and because forward - looking statements address future results, events and conditions, they, by their very nature, involve inherent risks and uncertainties, many of which are unforeseeable and beyond Zedge’s control. Such known and unknown risks, uncertainties and other factors may cause Zedge’s actual results, performance or other achievements to differ materially from the anticipated results, performance or achievements expressed, projected or implied by these forward - looking statements. These factors include those discussed under the headings "Risk Factors" and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Zedge’s periodic reports filed with the Securities and Exchange Commission. Zedge cautions that such factors are not exhaustive and that other risks and uncertainties may cause actual results to differ materially from those in forward - looking statements. Forward - looking statements speak only as of the date they are made and are statements of current expectations concerning future results, events and conditions and Zedge is under no obligation to update any of the forward - looking statements, whether as a result of new information, future events or otherwise. 2 Safe Harbor Statement

 

 

ZEDGE, Inc. 2020 3 Large Customer Base ~30MM Monthly Active Users Valuable asset for lowering CAC Solid Financial Performance Cashflow positive for past 3 consecutive quarters. $4.6MM in cash, virtually no debt, no warrants Valuation Extremely low valuation relative to industry peers (Based on Market Cap / MAU) Popular App ~450MM organic installs and growing ‘Top 60’ app in Google Play Growth Opportunities Pipeline of new apps/features. Recently released “Shortz” an entertainment play Optionality Leader in mobile personalization, new focus on entertainment, and Premium marketplace for artists Company Overview We offer a state - of - the art digital publishing platform that powers our consumer - facing mobile apps focused on entertainment

 

 

ZEDGE, Inc. 2020 Source: Google Analytics, Pushspring / comScore for US users 4 Highly Attractive User Base Meet The Users (A n d r oid) ~ 30,000,000 customers use the Zedge app, monthly, to personalize their phone BY AGE BY CONTINENT North Am e r ica 24% A sia 2 5 % E u r ope 26% R O W 25% AFFINITY AUDIENCES Video Streaming & Subscriptions Music Streaming & Subscriptions Photo & Video Enthusiasts Spo r ts Fans Social Influen c e r s Gamers 50% 100% TOP PERSONAS BY GENDER 38% 62% • Entertainment Addicts • Social Influencers • Sports Fans • Gamers OUR USERS ARE… 18 - 2 4 25 - 34 35 - 44 4 5 - 54 5 5+ 0% 2 5 % Sh oppe r s Comics and Animation Fans T e c hn ology Pet Lovers Cooking enthusiasts Social Media Enthusiasts 50% 100%

 

 

ZEDGE, Inc. 2020 5 Opportunities • Leverage efficient user acquisition channel • Offer new verticals that align with our existing customer demographics and have high frequency of use • Monetization via paid subscription, IAPs, and advertising which works well with a high frequency of use • Paid user acquisition is a possibility • Reinvigorate market growth in Tier 1 markets • Opens iOS market to growth Challenges • Changes our unique value proposition • Identifying the right verticals • Content acquisition • Establishing partnerships ~450MM Installs / ~50MM Active Installs* / ~30MM MAU Wallpapers Video Wallpapers Ringtones Notifications Stickers Indie Music? Features for ? ??? Zedge App Artists Brands Social Creators Low Frequency of Use Content Library Search & Dis c ov e r y Analytics / BI Marketplace Ma r k eting Tools Self Publishing Tools CMS Monetization/ eCommerce APIs Zedge Publishing Platform High Frequency of Use ASO Press SEO Shortz Chat Stories Zedge New App #2 Zedge New App #N Zedge Platform - 2020 * Active installs is the number of devices have an installed instance of the Zedge app.

 

 

We provide an easy to use, self - serve platform, where artists can manage their storefront, promote their art, generate royalty reports, and run marketing specials. Premium content promotion via: Homepage placement in app Push Notifications In app messages Video Interstitials Facebook and other social media Sample brands / artists promoting on Zedge Hollywood: Sony, Warner Brothers, Ilumination… Music: Nicki Minaj, Paul McCartney, Lil Wayne, 5SOS, Offset, Britney Spears… Other: Grump Cat, Popeye, Betty Boop… Video Wallpapers Dedicated Storefront "In addition to working with the music streaming companies, we chose Zedge to further engage with fans not only through music, but through art as well. Zedge has proven itself as a significant distribution channel for artists.” ~Mack Maine, President of Lil Wayne’s Young Money Records A Publishing Platform Made for Artists Reach Tens Of Millions Of Users A Week. Artists Start Making Money Immediately. No Strings Attached. Notification Sounds ZEDGE, Inc. 2020

 

 

Shortz - Extending Into Entertainment Serialized, Fictional, Short - Form Stories Delivered In A Text Messaging Like Interface Short form, serialized chat fiction Genres that lend themselves to spellbound storytelling Imagery and story summaries that provoke the Highly engaging, tap on screen to read each line of txt Cliffhanger chapter endings meant to prompt paid Subscription paywall to chapter and entire imagination subscriptions library 7 gain access to next ZEDGE, Inc. 2020

 

 

Opportunties 8 Cashflow positive for three consequitive quarters Revenue mix consists of: • Subscriptions - Close to 400K paying subscribers since Jan ’19 launch - Monthly and annual subscriptions - Prepaid benefit • Shortz - Chat Stories by Zedge - Extends Zedge’s value proposition into entertainment - Launched with subscriptions but tokens and advertising under development - Potential for ancillary revenue streams from exploiting highly popular content (ex. TV, Hollywood, print, etc.) - Relevant on iOS • Zedge Premium - Licensed content - Token economy Focusing on: • Diversifying the business with Shortz • Driving more subscription - based revenue • Better optimizing ad inventory • Unlocking value from emerging market install base Paid Subscribers - Cumulative (‘000) 0 100 200 300 400 ZEDGE, Inc. 2020

 

 

9 Increasing Valuation Opportunities abound to grow our business and enrich our valuation Z edge PlutoTV Pinterest Snap Twitter Spoti f y Facebook $241.20 $ 1 2 4 . 00 $7 1 . 2 0 $63 . 7 0 $ 3 5 . 10 $2 8 . 30 $ 0 .56 * Based on Company estimates Online Business Valuations* Zedge Wallpapers and Ringtones Market Cap / MAU • Paid subscriptions • Ad stack optimizations • Growing Zedge Premium • Product and marketing initiatives to grow MAU in well - developed markets Shortz - Chat Stories by Zedge • Introduce new monetization models including ad - supported and token based economy • Shortcastz (i.e. mini podcasts) • Paid user acquisition Other • Continued focus on SG&A • Rich pipeline of new products ZEDGE, Inc. 2020

 

 

ZEDGE, Inc. 2020 O t h er 52% Institutional 21% Inside r s 27% Capital Structure Clean capital structure with NO warrants and almost ZERO debt Summary Balance Sheets ($ ‘000) Jul 31, 2019 Apr 30, 2020 Cash & cash equivalents $ 1 , 609 $ 4 , 630 Total current assets $ 3 , 225 $5 , 790 Total assets $ 9, 0 0 7 $ 1 0 ,963 Total current liabilites $ 2 , 0 4 7 $ 2 , 668 Total Liabilities $ 2 , 0 4 7 $ 3 ,0 31 Total Stockholders equity $ 6 ,960 $ 7 , 9 3 2 Total liabilities & stockholders’ equity $ 9, 0 0 7 $ 1 0 ,963 Liquidity Profile ($’000) Apr 30, 2020 Credit facility $ 2 ,500 Balan c e outstan din g - Undrawn portion of credit facility $2,500 C ash & cash equi v alents $ 4 , 630 Total liquidity $7,130 * On a fully diluted basis Board of Directors Michael Jonas Executive Chairman Howard Jonas Vice Chairman, Founder & Chairman IDT Corp. Mark Ghermezian Co - CEO, American Dream Elliot Gibber President & CEO, Deb El Food Products Paul Packer Founder, Globis Capital Advisors LLC Greg Suess Founding Partner, Activist Artists Management, LLC Insider Ownership* Michael Jonas, Chairman 15 . 2 % Howard Jonas, Vice Chairman 1 . 3 % Management & ESOP 8 . 5 % Board of Directors 2 . 1 % Insider Ow n e r ship 2 7 . 1 % * On a fully diluted basis 10

 

 

11 Financial Overview ($ ‘000) R e v enue $0 $ 1 , 000 $ 2 , 000 $ 3 , 000 SG & A $0 $ 1 , 000 $ 2 , 000 $ 3 , 000 $ 2 00 $0 ($ 2 00) ( $ 400) ($600) ($800) ( $ 1 , 000) ($1,200) $0 $ 3 , 000 $ 6 , 000 Cash + Net Receivables - Net Payables R ev enue • Subsc r iption s • Advertising optimizations SG&A • Personnel • Cloud services • Discretionary spend Other • NYSE American: ZDGE • Fiscal year starts on Aug 1 • Research coverage by National Securities Income / (Loss) from Operations ZEDGE, Inc. 2020

 

 

~30MM Monthly Active Users 4.5 Star Rating With 8MM Reviews Top 60 Free Apps Google Play (5 years) ~100MM Search Queries Monthly 400MM+ Installs Top 20 iTunes Ent. Best Apps Google Play 1.2MM Facebook Likes ZEDGE, Inc. 2020 Jonathan Reich, CEO +1 . 330 . 577 . 3424 jon atha n. re i ch @ze dge .n et Thank y o u ! 12