RLJ Entertainment, Inc. (NASDAQ: RLJE), today announced financial results for the quarter and year ended December 31, 2017.

Fourth Quarter 2017 Highlights

• Digital Channels paying subscribers increased over 50% from the fourth quarter of 2016 to over 680,000. Digital Channels segment revenues increased 50.4% to $7.8 million from $5.2 millionin fourth quarter 2016.

• Total net revenue increased 15.3% year-over-year to $32.7 million, primarily driven by the increase in Digital Channels revenue. Wholesale Distribution segment revenue increased 7.9% year-over-year.

• Gross profit increased 52.0% year-over-year to $14.4 million and Gross margin of 44.2% expanded over 10 percentage points from 33.5% last year. These profit improvements were driven by growth in our Digital Channels revenue.

• Equity Earnings from Agatha Christie Limited (ACL) increased 219.5% year-over-year to $2.8 million; ACL film and publishing business segments grew year-over-year, primarily driven by Murder on the Orient Express theatrical release.

• Net income was $3.8 million, an improvement of $8.1 million from net loss of $4.3 million in fourth quarter of 2016.

Full Year 2017 Highlights

• Digital Channels segment revenue increased 67.2% to $27.2 million on over 50% paying subscriber growth and was 31.5% of 2017 total net revenue compared to 20.3% of 2016 total net revenue.

• Total net revenue increased 7.6% to $86.3 million, primarily driven by the increase in Digital Channels revenue.

• Gross profit increased 40.7% to $37.1 million and gross margin increased over ten percentage points to 43.0% in 2017 from last year. Continued growth in Digital Channels, representing a larger portion of total revenue, drove the improvements in in gross profit and gross margin.

• Net loss improved by $15.7 million and was $6.1 million for the year compared to a net loss of $21.9 million last year. Net income adjusted for non-cash warrant expense and 2012 fair value step up amortization would have been positive $1.0 million for 2017 compared to loss of $10.6 million in 2016.

• Adjusted EBITDA improved 26.5% to $16.6 million from $13.1 million last year.

Robert L. Johnson, Chairman of RLJ Entertainment, stated, "2017 was a year of dynamic development for RLJ Entertainment in every sense as the Company wins its share of premium audiences demanding a la carte channels that offer targeted, compelling programming backed by direct marketing and expanding distribution. Given the success of this strategy as demonstrated by these strong results, the tremendous opportunity that the quickly expanding OTT landscape affords and the appeal of Acorn TV and UMC, we expect the Company's timely strategy of increasing investments to drive accelerating value creation for subscribers and investors."

Miguel Penella, Chief Executive Officer of RLJ Entertainment, stated, "2017 was an instrumental year of strategic, financial and operating achievement, benchmarking well against our long-term strategic growth plan. We delivered excellent results for the year, driving rapid Digital Channels subscriber and high-margin revenue growth, leveraging our IP licensing capability and benefiting from Agatha Christie's robust performance, and transforming our media distribution and wholesale business toward digital media distribution. Our 2018 plan is to further intensify our Digital Channels' investments in selective, compelling and original programming, supported by increasingly strong marketing with the objective of achieving our 1 million subscriber target within 12 months."

Nazir Rostom, Chief Financial Officer of RLJ Entertainment, commented, "Fourth quarter 2017 results demonstrate the power of our strategy and the skill of our execution, driving our third consecutive quarter of total top-line growth. Our gross margin and EBITDA margin is expected to continue to expand as Digital Channels revenue continues to grow. With a solid balance sheet and clear 2018 priorities, we enter 2018 with strong momentum to deliver another year of growth in revenue, gross margin and bottom-line profitability."

About RLJ Entertainment, Inc.

RLJ Entertainment, Inc. (NASDAQ: RLJE) is a premium digital channel company serving distinct audiences primarily through its popular OTT branded channels, Acorn TV (British TV) and UMC (Urban Movie Channel), which have rapidly grown through development, acquisition, and distribution of its exclusive rights to a large library of international and British dramas, independent feature films and urban content. RLJE's titles are also distributed in multiple formats including broadcast and pay television, theatrical and non-theatrical, DVD, Blu-ray, and a variety of digital distribution models (including EST, VOD, SVOD and AVOD) in North America, the United Kingdom, and Australia. Additionally, through Acorn Media Enterprises, its UK development arm, RLJE co-produces and develops new programs and owns 64% of Agatha Christie Limited. For more information, please visit RLJEntertainment.com, Acorn.tv, and UMC.tv.