4Kids Entertainment Reports 2010 First Quarter Results

4Kids Entertainment, Inc. (NYSE: KDE), the global children’s entertainment and merchandise licensing company, today announced financial results for the first quarter ended March 31, 2010.

Net revenues for the three months ended March 31, 2010 totaled $4.2 million, compared to $9.3 million for the same period in 2009. The Company’s net loss attributable to 4Kids Entertainment for the three months ended March 31, 2010 was $(3.5) million, or $(0.26) per diluted share, as compared to a net loss of $(2.0) million, or $(0.15) per diluted share, for the same period in 2009.

As of March 31, 2010, the Company had approximately $9.3 million in cash and $11.7 million in investment securities at their fair market value.

The Company announced that it had received a non-binding indication of interest from a third party to acquire 4Kids for a price representing a premium over the recent closing prices for the Company’s common stock, subject to the satisfactory completion of due diligence and negotiation of definitive agreements during a requested exclusivity period. The Special Committee of the Board of Directors formed in 2009 in connection with the Board of Directors’ evaluation of strategic alternatives has authorized the Company’s management to provide the potential acquirer with due diligence information regarding the Company’s assets and operations and intends to enter into discussions with the potential acquirer regarding exclusivity and the acquirer’s indication of interest. There can be no assurance that any transaction with the potential acquirer will be concluded.

The Company also announced that its market capitalization had slipped below the minimum $15 million market capitalization that New York Stock Exchange listed companies are required to maintain in order to remain listed and that the Company’s shares could be delisted at any time.

“In the first quarter of 2010, our revenue decreased from the comparable period in 2009 due to lower licensing revenue and reduced television advertising revenue. Although first quarter 2010 Yu-Gi-Oh! revenues were essentially flat, the Company received reduced licensing revenues from several properties formerly represented by the Company," said Alfred R. Kahn, Chairman and Chief Executive Officer of 4Kids Entertainment.