YouthStream Media Networks, Inc. Reports Results of Operations for the Year Ended September 30, 2004

YouthStream Media Networks, Inc. Reports Results of Operations for the Year Ended September 30, 2004 NEW YORK, Jan. 18 /PRNewswire-FirstCall/ -- YouthStream Media Networks, Inc. (BULLETIN BOARD: YSTM) (the "Company") announced the results of its operations for the year ended September 30, 2004, reporting a net loss of $2,366,000, as compared to a net loss of $3,128,000 for the year ended September 30, 2003. The loss from continuing operations for the year ended September 30, 2003 of $831,000 or $0.02 per share was net of a gain on settlement of debt of $2,800,000 or $0.07 per share. Included in the net loss for the year ended September 30, 2004 was a loss from discontinued operations of $550,000, as compared to a loss from discontinued operations of $2,997,000 for the year ended September 30, 2003. The net loss from discontinued operations of $550,000 for the year ended September 30, 2004 consisted of a net loss from discontinued operations of $1,050,000, reduced by a gain from the reduction of a prior accrual with respect to the closing of retail stores of $500,000. Also included in the net loss for the year ended September 30, 2004 was a loss on disposal of discontinued operations of $822,000, as compared to a gain on disposal of discontinued operations of $700,000 for the year ended September 30, 2003. Net loss per common share for the years ended September 30, 2004 and 2003 is summarized as follows: Years Ended September 30, ------------------------- 2004 2003 ------ ------ Loss from continuing operations $(0.03) $(0.02) Loss from discontinued operations (0.01) (0.08) Gain (loss) on disposal of discontinued operations (0.02) 0.02 ---- ---- Loss per common share - Basic and diluted $(0.06) $(0.08) ==== ==== Weighted average number of common shares outstanding - Basic and diluted 39,242,000 37,987,000 ========== ========== From October 1, 2003 through February 25, 2004, the Company conducted its business operations through its wholly-owned subsidiary, Beyond the Wall, Inc. ("BTW"), which consisted of the sale of decorative wall posters through on-campus sales events, retail stores and internet sales, primarily to teenagers and young adults. As previously reported, effective February 25, 2004, the Company sold substantially all of the assets and operations of BTW, as a result of which the Company no longer has any revenue-generating business operations. The Company recorded a loss of $822,000 with respect to this transaction for the year ended September 30, 2004. In addition and as previously reported, effective July 18, 2004, the Company entered into a preliminary letter of intent with KES Holdings, LLC ("KES Holdings") to acquire KES Acquisition, LLC ("KES Acquisition"). KES Acquisition owns a steel mini-mill located in Ashland, Kentucky. In conjunction with the proposed acquisition, the Company will form a new subsidiary in which it will own 80.01% of the total outstanding common stock and 100% of the voting common stock, and will capitalize that subsidiary with $500,000. In connection with the acquisition, the new subsidiary is expected to issue to the owners of KES Acquisition in exchange for 100% of their equity interest in KES Acquisition (i) $25,000,000 of its non-convertible non-voting redeemable preferred stock with a redemption price equal to $25,000,000 and a 13% annual cumulative dividend and (ii) senior subordinated promissory notes in the aggregate principal amount of $40,000,000 with an annual interest rate of 8%. As part of this transaction, the remaining 19.99% common stock interest in the new subsidiary will be owned by the former owners of KES Acquisition. The letter of intent is subject to, among other conditions, negotiation, preparation and execution of definitive transaction documents, preparation of consolidated financial statements, compliance with state and federal securities laws and regulations, and receipt of requisite corporate approvals. The transaction is expected to close in the first calendar quarter of 2005. However, as a result of the foregoing uncertainties, there can be no assurances that the transaction will be completed. Furthermore, even if the transaction is completed, there can be no assurances that the future operations of the steel mini-mill will be successful. Cautionary Statement Pursuant to Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995: This news release contains "forward-looking" statements, which are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among others, statements of expectations, beliefs, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. The forward-looking statements in this news release are subject to risks and uncertainties that could cause actual results to differ materially from those results expressed in or implied by the statements contained herein. The Company undertakes no obligations to revise or update any forward-looking statements contained herein in order to reflect events or circumstances that may arise after the date of this news release. Source: YouthStream Media Networks, Inc. CONTACT: Investor Relations of YouthStream Media Networks, Inc., +1-212-883-0083 ------- Profile: International Entertainment