Ladies and gentlemen. Thank you for standing by. Welcome to the Genius Brands International Second Quarter 2022 Business Update Call. At this time, all participants are in a listen-only mode. I would now like to turn the call over to David Waldman, Investor Relations. David, please go ahead.

Thank you. Good afternoon, everyone and welcome to Genius Brands' Second Quarter 2022 Financial Results and Investor Update Conference Call. On the call with us this afternoon is Andy Heyward, Chairman and CEO; Bob Denton, Chief Financial Officer; and Michael Hirsch, CEO of WOW!. The company issued a press release this morning. If you have not received a copy, you can view it on the company's website at gnusbrands.com. Before I turn the call over to Genius Brands' CEO, Andy Heyward, I would like to remind you that this call certain statements constitute forward-looking statements within the meaning of the federal securities laws. Words such as may, might, will, should, believe, expect, anticipate, estimate, continue, predict, forecast, project, plan, intend or similar expressions or statements regarding intent, belief or current expectations are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements which are based on information available to us on the date of this call. These forward-looking statements are based upon current estimates and assumptions, and are subject to various risks and uncertainties, including risk factors set forth in the Risk Factors section of the company's most recent annual report on Form 10-K and the company's subsequent filings with the Securities and Exchange Commission, not. Thus, actual results could differ materially from those reported. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law. Following their prepared remarks, the company will field the number of questions that investors have submitted in anticipation of the call. I'd now like to turn the call over to Genius Brands CEO, Andy Heyward. Please go ahead Andy.

Thank you, David and good morning, everyone. The second quarter was very strong for Genius Brands. We experienced significant top line growth with record revenues of $21 million, which we now expect to continue and accelerate. The assets currently now in-house and those being acquired and developed, we believe will lead to recurring positive cash flow, more growth and sustained profitability. During this last quarter, we've gone from a company with 100 employees to a company of over 900 employees, with offices in Los Angeles, New York, New Jersey, Toronto, Vancouver, Munich and London. We've grown our owned or controlled catalog of animated children's programs from 450 episodes to over 3,800 episodes and now have over 22,000 animated children's episodes under license to the Kartoon Channel! system. We have grown our Kartoon Channel! distribution footprint from just the US to now being seen in over 60 territories worldwide via satellite, cable and terrestrial, as well as streaming in Europe, the Middle East, Africa, Latin America and Asia. We've gone from a company producing 26 episodes of content at this time last year to producing over 200 half-hour episodes with over $135 million of production and a robust pipeline with significant committed contracts going forward for the next three years and beyond. Our programs are seen not only on our growing Kartoon Channel! but are additionally licensed to Netflix, Amazon, YouTube, Peacock, Paramount+, HBO Max and terrestrial and satellite broadcasters worldwide. We completed the transformational acquisition of WOW! Unlimited Media, signed a 20-year deal with Marvel Studios and the Walt Disney Company to license Stan Lee for use in feature films, television productions and Disney theme parks and experiences and we are in additional and material conversations with the Walt Disney Company on separate opportunities. Also during this quarter, we partnered…

Thank you, Andy. The integration of WOW! Unlimited Media consisted of Frederator Networks and Studio and Mainframe Studios into the Genius Brands family has been going extremely well. The transaction was expected to provide immediate and continuing financial benefits along with strong revenues as a result of significant contracted bookings into 2023 and beyond. Indeed WOW! has had a banner year and continues to see revenues increasing at an accelerated pace. We are currently producing over 183 episodes of animated content with production budgets in excess of $100 million. The company operates at a profit on a cash basis and we expect to see working with Genius to increase our margins and make a significant contribution to the overall Genius bottom-line. As a result of the combination, Genius Brands now has an end-to-end animation ecosystem that has produced many profitable titles including Cocomelon, the number one children series in the world today; as well as Barbie: It Takes Two, Octonauts: Above and Beyond and . While many of these are work for hire, we are also now doing our own original content and currently have shows in production for YouTube, Netflix, Sony, and elsewhere. Our series Team Zenko Go with DreamWorks Animation just launched its second season on Netflix and our new series Bee and PuppyCat will launch on Netflix on September 6th. Bee and PuppyCat has had tremendous support on Twitter with millions of views for our Netflix trailer as well as other social platforms from the show's enthusiastic fans. It represents a major success for the Frederator approach to developing a show first on a Tier 2 platform and then upon success migrating it to a more commercial platform that broadens the show's appeal. The addition of captive in-house animation production for Genius Brands is expected to drive significant cost synergies resulting in economies of scale, which will drive increased shareholder value as new brands have -- been brought to market and eventually the Kartoon Channel! and through the Genius Brands licensing organization. This transaction is a transformational event for Genius Brands as the company will continue to execute on its strategy to establish itself as a foremost producer, broadcaster and licenser of high-quality children's entertainment and children's consumer products on a global basis. There are very few asset classes with proven and enduring value as animated children's programming. And we are extraordinarily excited about what the future holds for this powerful combination. I would now like to turn the call over to Bob Denton, CFO -- to discuss the company's financial results for the quarter. Bob?

Thanks, Michael. As Andy mentioned earlier, total revenues for the quarter ended June 30, 2022 were $22.1 million largest quarterly revenues in the history of the company, an increase of $19.7 million or 843% from $2.3 million in the same quarter last year. These increases are primarily due to the addition of Ameba in January and the acquisition of WOW! at the beginning of the quarter. Expenses for the quarter increased primarily due to an increase in direct operating costs an increase in general and administrative expenses including the onetime charge professional fees associated with the acquisition of WOW! and its subsidiaries, an increase in incentive compensation expense, which is a non-cash expense and the inclusion of WOW! general and administrative expenses for the three months ended June 30, 2022. The net loss attributable to Genius Brands for the quarter ended June 30, 2022 was $13.3 million or $0.04 per share compared to $7.4 million or $0.02 per share for the three months ended June 30, 2021. This increase is directly related to the increase in expenses noted above. Turning to the balance sheet. As of June 30, 2022 we had current assets of $150.3 million including cash, cash equivalents and marketable securities of $105.2 million, working capital of $63.6 million and total stockholders' equity of $143.1 million. We are closely managing our cash balances which we consider the most important indicator for the company as we integrate and build our combined businesses and increase our assets with the goal of increasing earnings and becoming cash positive. Our acquisition and investments are indications of our commitment to continue creating top-tier children's content, creating a global and enduring animation catalog and the expansion of our Kartoon Channel! distribution system. We believe that it is the best and smartest deployment of our capital and that in the long-term it will ultimately yield the most value for our shareholders. I would now like to turn the call back over to Andy for some final comments. Andy?

Thank you, Bob. First I want to thank all of our investors for participating in the call today and for your support over the years as we've transformed Genius into a powerhouse within the children's entertainment industry. We are growing across key units, increasing market share building timeless assets and all signs point to that momentum continuing and accelerating. We are now in year two since the launch of Kartoon Channel! and as I said at the beginning top-line revenue growth this quarter of more than 800% to over $22 million broke all records. We will continue to make decisions to grow our asset base and reach sustainable and growing profitability. As we continue to build on the substantial progress, I look forward to speaking with everyone again in keeping you informed of initiatives how we are building best programs for children license products from those programs and the most effective distribution programs. But as they say the best is yet to come. Last but not least I am particularly excited about our upcoming series Shaq's Garage and the strong vehicle-based consumer products program that we anticipate will come from it. Shaq’s Garage is a series we are very proud of because it has extraordinary entertainment, which we think will be a huge performer but also it shows extremely positive value to kids in a diverse and responsible world. Shaquille O'Neal has been personally hands-on throughout and he's very committed to the positive storytelling that the series will embrace alongside the humor and hygiene. The pilot episode will enjoy a sneak peek on Kartoon Channel! effective immediately. It's up now and lasting for 48 hours. I encourage everyone to go see it. And not only see Shaq but also his costar Rob Gronkowski. Now we want to take this opportunity to answer questions that were previously submitted to the company. David I think you have the questions?

Yeah. Thank you, Andy. Sorry. In our conference call announcement press release, we suggested interested parties submit their questions in advance. We'd like to address those questions for you now. Some of them were duplicative, so we did our best to reconcile those where possible. If you have further questions after the call please feel free to follow up with Investor Relations and we'll be sure to respond as quickly as possible. Our first question from investors is the following. Given the company's revenue growth at what point do you expect to turn profitable?

Good question. We're not prepared to give formal guidance right now. But as we continue to grow, we do expect to turn profitable in the not distant future and generate quite significant cash flow. In the meantime, we're carefully managing expenses expect to generate significant cost synergies from the WOW! acquisition and the path to sustained and reliable and continuing earnings is from the build-out of our global animation catalog and our global distribution system. We're building Genius to become a dominant force in kid’s entertainment. And in order to do that, we must invest wisely to maximize long-term value for our shareholders.

Thank you Andy. Our next question is, how are you managing the rapid growth now to a company of over 900 people?

Good question. Our Board member, Tony Thomopoulos has graciously agreed to now serve as Vice Chairman of the Genius Brands Board of Directors. Tony brings a distinguished career of experience coming from being President of ABC Entertainment and ABC Broadcast Group, Chairman of United Artists Pictures, and President of Steven Spielberg's, Amblin Television. Tony will not only lead our greenlight committee but will also focus on unifying the many pieces of the company now and working with all of the units to help ensure they stay on their growth and earnings targets. We're very fortunate to indeed have his wisdom and experience. He's already instituted protocols and disciplines. He's been working with Bob Denton and Mike Jaffa to help ensure we hit our targets and good governance remains a top priority.

Great. Thank you Andy. The next question is what are the company's plans to buy back stock?

I would say that given the volatility in the market and the importance of preserving capital, we've not undertaken a buyback up to this point, but we have and will continue to evaluate all our options of which that is one.

Okay. Thank you. Our next question, is Genius Brands affected by interest rates, energy or inflation?

Good question. Well, we're not really an energy consumer. You don't use energy to build automated cartoons. We use creative energy. So if I could be a little whimsical, I would say we could be said to be an energy supplier not a user. Interest rates, we have minimal exposure to interest rates. We have a lot of cash in the company right now. And while we do have some production based borrowing that's not really effective for us.

Great. Thank you. Our next question, does Genius have exposure to China through its productions or otherwise?

Good question. We enjoy good relations, because of our super stroke kindergarten series now being broadcast with our Chinese partner, Alibaba on their Youku platform. That's the most robust kid's platform in China. And to the best of my knowledge we're the only American supplier of children's content to Alibaba. We are paid cash for our programs we sell to China in US dollars. At the same time, our exposure to commercial pressures from China is minimal because we've migrated the bulk of our nation production from Chinese animation studios to Indonesia and the Philippines where pricing is currently much more favorable and production quality remains high.

Thank you. Our next question, can you provide an update on Shaq’s Garage and what you think sets it apart from other productions?

I've talked a little bit about it earlier, but the current plan for Shaq’s Garage is to begin delivering episodes in the fourth quarter of this year. All of the scripts are written, both Shaquille and Rob Gronkowski have recorded 90% of their voices. The show we consider to be a PAW Patrol with cars. It's very cool. The music is very cool. The stories are aspirational and fun, more cool cars than you can ever imagine. We're also excited about a show within a show that will appear in many of the episodes. It's a segment called Baby Shaq. I'm not going to say more about it now only that if you like Baby Shark, you're going to love Baby Shaq. We're going to do a sneak peek of the first episode. It will be on for 48 hours only. It's up now on Kartoon Channel!.

Great. Our next question is given the growing importance of ESG, what if any steps is Genius taking including environmental measures?

Okay. So our management has decided to take a leadership role in the entertainment industry on how we can best protect the environment as corporate citizens, as we tell stories to depict positive environmental steps for our children. Our Chief Diversity Officer, Michael Riley has now been given the additional role and responsibility of Chief Environmental Officer and the company has put a number of specific initiatives in place to make us a more environmentally friendly company and a leader in social responsibility overall. These range from carpooling incentives, adding LED energy light saving -- saving lights to having environmental lessons in our shows for the kids to learn from. We have an all-company electronic recycling day coming shortly. We have toxin reduction programs and we have a conservation program promoting company-wide steps of reduce reuse and recycle. These are all on our website starting today for all our clients and shareholders to see. We understand the importance of stepping forth on environmental issues. We embrace this responsibility in the stories we tell, as well as broadcast on our channels. And the impact it has on children as well as the concrete steps that we've taken to make the company more environmentally friendly. We believe that our company will continue to grow and flourish not in spite of our commitments to sustainability and social responsibility, but because of it. Next question, David.

Great. Thank you. Can you talk about the merchandising strategy and when we can expect to see toys and other products on the shelves?

The kids merchandise business is unpredictable. But every year there are some very, very big hits. We don't know which of our characters if any will catch fire, but we believe we have several very good shots. Many of our brands have pre-sold market value and existing businesses associated with them that will drive sampling. Wolfgang Puck, for example, as I said earlier, it's currently a $650 million a year business. We would be very excited to have a kids version, which is a fraction of that. Stan Lee merchandise will be coming very shortly and you can expect a significant announcement on that in the near future. The Disney merchandise of Stan Lee, which will appear in the parks and theme park experiences will be forthcoming on their schedule. I believe they're very enthusiastic about this and look forward to having Stan be an important part of their Marvel experience. We have a variety of brands with different activities in different stages, including Llama has an ongoing staple and Rainbow Rangers, which we are going to reboot with a new master toy licensee because we believe in it. Shaq’s Garage we think is a natural on many fronts. It has the same play has some very successful products like Hot Wheels, Pixar's Cars and PAW Patrol. However, we think the creative premise is very special and differentiated. There are a number of products now coming out of Frederator and Mainframe, which we have the potential to become significant in merchandising for us as well. Bee and PuppyCat which was first incubated on YouTube and has developed a large audience and will debut next month on Netflix is one of them.

Great. Thank you Andy. That does conclude the questions. We appreciate everybody's support, and we look forward to providing further updates. Thank you.

Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.