Collectors Universe, Inc.
Aug 28, 2014
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Collectors Universe Reports Record Revenues in Fourth Quarter of FY 2014

Service Revenues up 25% and Operating Income up 31% for Fiscal 2014

NEWPORT BEACH, Calif., Aug. 28, 2014 (GLOBE NEWSWIRE) -- Collectors Universe, Inc. (Nasdaq:CLCT), a leading provider of value-added authentication and grading services to dealers and collectors of high-value collectibles, today announced financial results for its fourth quarter and fiscal year 2014.

Operational and Financial Highlights:

Commentary and Outlook

Robert Deuster, Chief Executive Officer, stated, "I am very pleased to report our record results for fiscal 2014. All of the Collector Universe's authentication and grading businesses grew last year and our efforts to expand the PCGS coin grading brand was particularly successful, with strong service revenues each quarter, despite the seasonality that typically affects that business. Our sports business continued its multiyear growth trajectory. As we look ahead to fiscal 2015, our emphasis on serving the needs of collectors for information and superior authentication and grading services will be our main focus, to further reinforce our leadership position."               

Conference Call and Webcast

Collectors Universe will host a conference call to discuss results on Thursday, August  28, 2014 at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time. Interested parties may participate in the conference call by dialing 888-481-2844 or 719-457-2648, five to ten minutes prior to the initiation of the call. A replay of the conference call will be available through September 11, 2014 by dialing 888-203-1112 or 719-457-0820 and entering access code 5897533#. A live webcast of the conference call will also be available on the Collectors Universe website, under Investor Relations: Events and Presentations. The webcast will be archived for 12 months.

About Collectors Universe

Collectors Universe, Inc. is a leading provider of value-added services to the high-value collectibles markets. The Company authenticates and grades collectible coins, trading cards, event tickets, autographs and memorabilia ("collectibles"). The Company also compiles and publishes authoritative information about United States and world coins, collectible trading cards and sports memorabilia ("collectibles"), and operates its CCE dealer-to-dealer Internet bid-ask market for certified coins and its Expos trade show and conventions business. This information is accessible to collectors and dealers at the Company's website, and is also published in print.

Cautionary Statements Regarding Forward Looking Information

This news release contains statements regarding our expectations, beliefs or views about our future financial performance and trends in our business and in our markets, which constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward looking statements can often be identified by the use of words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," or future or conditional verbs such as "will," "would," "should," "could," or "may."

Due to a number of risks and uncertainties to which our business and our markets are subject, our future financial performance may differ, possibly significantly, from our expected financial performance as set forth in the forward-looking statements contained in this news release. Information regarding those risks and uncertainties, and their possible impact on our future financial performance, include, but are not limited to, the following: our continued dependence on our coin business which generated more than 60% of our consolidated revenues and a substantial portion of our operating income in the year ended June 30, 2014, making our operating results more vulnerable to conditions that could adversely affect or cause stagnation in the prices of precious metals and collectible coins; the risks that the economic recovery may remain weak or stall, or that economic conditions may deteriorate as a result of events outside of our control, including international tensions that could cause volatility in the prices of gold and silver, and therefore, could result in reductions in the demand for our collectibles authentication and grading services and, consequently, in our revenues and operating results; the risk that the economic recession from 2008 to 2010 and the weakness of the economic recovery in the United States will lead to longer-term changes in the spending habits of consumers and in the availability and use of credit by smaller businesses, such as collectibles dealers, to fund purchases of collectibles, which could lead to longer-term declines in collectibles commerce and, therefore, in the demand for our services; the risks that claims under our coin and trading card authentication and grading warranties will increase substantially and that the warranty reserves we maintain for such claims, will, as a result prove to be inadequate, which could cause our gross margin and operating results to decline or cause us to incur operating losses, the risk that our strategies of offering new services and expanding our collectibles authentication and grading business into new geographic areas, such as Europe and Asia will not be successful in enabling us to improve our profitability or may even cause us to incur significant losses; the risks and added complexity of conducting business overseas, the risk that it may become necessary for us to reduce the amount of, or suspend or discontinue the payment of cash dividends in the future, due to conditions or circumstances outside of our control, such as adverse economic or market conditions, as well as our future financial performance and the cash needs of our business in the future; and the risk that our continuing financial obligations with respect to two facilities in New York City, which we had leased for our subsequently discontinued jewelry businesses, will lead to reductions in cash flows and additional losses from discontinued operations in future periods.

Additional information regarding these risks and information regarding other risks and uncertainties to which our business is subject is contained in Item 1A, entitled "Risk Factors", in our Annual Report on Form 10-K for our fiscal year ended June 30, 2014 which we filed today with the Securities and Exchange Commission and readers of this news release are urged to review the discussion of those risks and uncertainties in that Report. Also, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as material to our business or operating results. Due to these risks and uncertainties, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release or in our Annual or Quarterly Reports filed with the Securities and Exchange Commission, which speak only as of their respective dates. We also disclaim any obligation to update or revise any of the forward-looking statements as a result of new information, future events or otherwise, except as may be required by law or NASDAQ rules.

- tables to follow - 

(In Thousands, except per share data)
  Three Months Ended
June 30,
Year Ended
June 30,
  2014 2013 2014 2013
Net revenues:        
Authentication, grading and related services $  16,512 $ 13,744 $ 60,468 $ 48,507
Product Sales   35  33  103  583
      16,547  13,777  60,571  49,090
Cost of revenues:        
Authentication, grading and related services    6,007  5,017  22,541  18,496
Product sales    49  17  122  572
       6,056   5,034  22,663  19,068
Gross profit     10,491  8,743  37,908  30,022
Operating expenses:        
Selling and marketing expenses 2,325  1,866 9,106 7,407
General and administrative expenses 4,357  3,565 16,326 13,121
Total operating expenses  6,682  5,431 25,432 20,528
Operating income  3,809  3,312 12,476 9,494
Interest income and other expense, net  12 18 39 97
Income before provision for income taxes  3,821 3,330 12,515 9,591
Provision for income taxes 1,418 1,328 5,081 3,803
Income from continuing operations     2,403  2,002 7,434  5,788
Loss from discontinued operations, net of income taxes   (15)  (19)  (75)  (58)
Net income $  2,388 $ 1,983 $ 7,359 $  5,730
Net income per basic share:        
Income from continuing operations $  0.29 $ 0.25 $  0.91 $  0.72
Loss from discontinued operations  -- -- (0.01) (0.01)
Net income per basic share $ 0.29 $ 0.25 $ 0.90 $ 0.71
Net income per diluted share:        
Income from continuing operations $ 0.29 $ 0.25 $ 0.90 $ 0.71
Loss from discontinued operations  -- (0.01) (0.01)  --
Net income per diluted share $ 0.29 $ 0.24 $ 0.89 $ 0.71
Weighted average shares outstanding:        
Basic 8,223 8,075 8,167 8,052
Diluted  8,334 8,105 8,247 8,101
Dividends declared per common share $ 0.325 $ 0.325 $ 1.30 $ 1.30


(In Thousands, except per share data)
ASSETS June 30,
June 30,
Current assets:    
Cash and cash equivalents $ 19,909 $ 18,711
Accounts receivable, net of allowance of $26 and $27 at June 30, 2014 and 2013, respectively 2,118  2,067
Inventories, net 1,888 1,656
Prepaid expenses and other current assets 1,367 964
Deferred income tax assets 1,719 1,328
Total current assets 27,001 24,726
Property and equipment, net 2,466 2,153
Goodwill 2,083 2,083
Intangible assets, net 1,272 1,477
Deferred income tax assets 2,204 2,003
Other assets 380 394
Non-current assets of discontinued operations 182 182
  $ 35,588 $ 33,018
Current liabilities:    
Accounts payable $  2,062 $ 1,608
Accrued liabilities 2,817 2,121
Accrued compensation and benefits 4,139 2,680
Income taxes payable 851 760
Deferred revenue 2,645 2,345
Current liabilities of discontinued operations 849 802
Total current liabilities 13,363 10,316
Deferred rent 461 474
Non-current liabilities of discontinued operations 1,124 1,666
Commitments and contingencies    
Stockholders' equity:    
Preferred stock, $.001 par value; 3,000 shares authorized; no shares issued or outstanding -- --
Common stock, $.001 par value; 20,000 shares authorized; 8,861 and 8,509 issued and outstanding at June 30, 2014 and 2013, respectively.  9 9
Additional paid-in capital 78,011 74,578
Accumulated deficit (57,380) (54,025)
Total stockholders' equity 20,640 20,562
  $ 35,588 $ 33,018
(in thousands)
  Year Ended June 30,
  2014 2013
Net income $ 7,359 $ 5,730
Adjustments to reconcile net income to net cash  provided by operating activities:    
(Income) loss from discontinued operations 75 58
Depreciation and amortization expense 1,256 1,044
Stock-based compensation expense 1,946 831
Provision for bad debts 25 8
Provision for inventory write-down 94 28
Provision for warranty 791 659
Loss (gain) on sale of property and equipment 4 (7)
Interest accrued on note receivables -- (6)
Changes in operating assets and liabilities:    
Accounts receivable (95) (318)
Inventories (326) 589
Prepaid expenses and other (402) (151)
Deferred income taxes (272) 764
Other assets 15 (225)
Accounts payable and accrued liabilities 379 (274)
Accrued compensation and benefits 1,459 217
Income taxes payable 90 569
Deferred revenue 300 23
Deferred rent (13) 27
Net cash provided by operating activities of continuing operations 12,685 9,566
Net cash used in operating activities of discontinued operations (569) (512)
Net cash provided by operating activities 12,116 9,054
Capital expenditures (1,166) (1,020)
Proceeds from sale of property and equipment 7 37
Patents and other intangibles (23) (65)
Proceeds from sale of business 18 37
Capitalized software development costs (191) (28)
Cash received from sale of net assets of discontinued operations -- 154
Net cash used in investing activities (1,355) (885)
Proceeds from exercise of stock options 1,354 143
Payments for retirement of common stock  (186) (14)
Dividends paid to common stockholders  (10,731)  (10,801)
Net cash used in financing activities (9,563) (10,672)
Increase (decrease) in cash and cash equivalents 1,198 (2,503)
Cash and cash equivalents at beginning of year 18,711 21,214
Cash and cash equivalents at end of year $19,909 $18,711
Income taxes paid during the period $ 5,217 $ 2,436
CONTACT: Joseph Wallace

         Chief Financial Officer

         Collectors Universe



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