(Mark
One)
|
|
ý
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
For
the quarter ended March 31, 2007
|
|
OR
|
|
q
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934 [NO FEE REQUIRED]
|
For
the transition period from _______ to _____
|
|
Commission
file number 0-27887
|
|
COLLECTORS
UNIVERSE, INC.
(Exact
name of Registrant as specified in its
charter)
|
Delaware
|
33-0846191
|
(State
or other jurisdiction of
|
(I.R.S.
Employer Identification No.)
|
Incorporation
or organization)
|
|
1921
E. Alton Avenue, Santa Ana, California 92705
|
|
(address
of principal executive offices and zip code)
|
|
Registrant's
telephone number, including area code: (949)
567-1234
|
Class
|
Outstanding
at April 25, 2007
|
||
Common
Stock $.001 Par Value
|
8,463,711
|
||
PART
I
|
Financial
Information
|
Page
|
|
Item
1.
|
|||
1
|
|||
2
|
|||
3
|
|||
4
|
|||
6
|
|||
Item
2.
|
25
|
||
25
|
|||
25
|
|||
26
|
|||
27
|
|||
28
|
|||
31
|
|||
36
|
|||
38
|
|||
39
|
|||
Item
3.
|
40
|
||
Item
4.
|
41
|
||
PART
II
|
Other
Information
|
||
Item
1A.
|
42
|
||
Item
2.
|
42
|
||
Item
6.
|
42
|
||
S-1
|
|||
E-1
|
|||
EXHIBITS
|
|||
Exhibit
31.1
|
Certifications
of Chief Executive Officer Under Section 302 of the Sarbanes-Oxley
Act of
2002
|
||
Exhibit
31.2
|
Certifications
of Chief Financial Officer Under Section 302 of the Sarbanes-Oxley
Act of
2002
|
||
Exhibit
32.1
|
Chief
Executive Officer Certification Under Section 906 of the Sarbanes-Oxley
Act of 2002
|
||
Exhibit
32.2
|
Chief
Financial Officer Certification Under Section 906 of the Sarbanes-Oxley
Act of 2002
|
March
31,
|
June
30,
|
||||||
2007
|
2006
|
||||||
ASSETS
|
|||||||
Current
assets:
|
|||||||
Cash
and cash equivalents
|
$
|
43,075
|
$
|
52,110
|
|||
Accounts
receivable, net of allowance for doubtful accounts of $67 (March)
and $37
(June)
|
1,609
|
1,753
|
|||||
Inventories,
net
|
467
|
437
|
|||||
Prepaid
expenses and other current assets
|
1,397
|
1,010
|
|||||
Customer
notes receivable, net of allowance of $22 (March) and $16
(June)
|
2,180
|
3,797
|
|||||
Deferred
tax assets
|
1,010
|
1,414
|
|||||
Receivables
from sale of net assets of discontinued operations
|
92
|
196
|
|||||
Current
assets of discontinued operations held for sale
|
54
|
83
|
|||||
Total
current assets
|
49,884
|
60,800
|
|||||
Property
and equipment, net
|
3,920
|
1,897
|
|||||
Goodwill
|
15,104
|
9,799
|
|||||
Intangible
assets, net
|
7,249
|
4,674
|
|||||
Note
receivable from sale of discontinued operations
|
252
|
321
|
|||||
Deferred
tax assets
|
810
|
342
|
|||||
Other
assets
|
519
|
388
|
|||||
$
|
77,738
|
$
|
78,221
|
||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
Current
liabilities:
|
|||||||
Accounts
payable
|
$
|
1,351
|
$
|
907
|
|||
Accrued
liabilities
|
2,045
|
2,043
|
|||||
Accrued
compensation and benefits
|
1,208
|
1,075
|
|||||
Income
taxes payable
|
5
|
496
|
|||||
Deferred
revenue
|
2,144
|
1,384
|
|||||
Current
liabilities of discontinued operations held for sale
|
7
|
8
|
|||||
Total
current liabilities
|
6,760
|
5,913
|
|||||
Deferred
rent
|
475
|
402
|
|||||
Other
long-term liabilities
|
40
|
-
|
|||||
Commitments
and contingencies
|
-
|
-
|
|||||
Stockholders'
equity:
|
|||||||
Preferred
stock, $.001 par value; 5,000 shares authorized; no shares issued
or
outstanding
|
-
|
-
|
|||||
Common
stock, $.001 par value; 45,000 shares authorized; 8,464 issued
and outstanding at March 31, 2007 and 8,350 (net of treasury shares)
at
June 30, 2006
|
9
|
8
|
|||||
Additional
paid-in capital
|
76,451
|
76,909
|
|||||
Accumulated
deficit
|
(5,997
|
)
|
(3,990
|
)
|
|||
Treasury
stock, at cost (125 shares)
|
-
|
(1,021
|
)
|
||||
Total
stockholders' equity
|
70,463
|
71,906
|
|||||
$
|
77,738
|
$
|
78,221
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
March
31,
|
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Net
revenues
|
$
|
11,081
|
$
|
10,022
|
$
|
29,772
|
$
|
26,294
|
|||||
Cost
of revenues
|
5,138
|
4,088
|
13,861
|
10,578
|
|||||||||
Gross
profit
|
5,943
|
5,934
|
15,911
|
15,716
|
|||||||||
Operating
expenses:
|
|||||||||||||
Selling
and marketing expenses
|
2,411
|
1,378
|
5,106
|
3,386
|
|||||||||
General
and administrative expenses
|
3,729
|
3,152
|
11,389
|
9,343
|
|||||||||
Amortization
of intangible assets
|
219
|
102
|
577
|
157
|
|||||||||
Total
operating expenses
|
6,359
|
4,632
|
17,072
|
12,886
|
|||||||||
Operating
income (loss)
|
(416
|
)
|
1,302
|
(1,161
|
)
|
2,830
|
|||||||
Interest
income, net
|
511
|
588
|
1,624
|
1,738
|
|||||||||
Other
income
|
2
|
8
|
8
|
24
|
|||||||||
Income
before income taxes
|
97
|
1,898
|
471
|
4,592
|
|||||||||
Provision
for income taxes
|
165
|
804
|
336
|
1,965
|
|||||||||
Income
(loss) from continuing operations
|
(68
|
)
|
1,094
|
135
|
2,627
|
||||||||
Income
from discontinued operations, net of gains on sales of
discontinued
businesses (net of income taxes)
|
99
|
-
|
190
|
169
|
|||||||||
Net
income
|
$
|
31
|
$
|
1,094
|
$
|
325
|
$
|
2,796
|
|||||
Net
income per basic share:
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
(0.01
|
)
|
$
|
0.13
|
$
|
0.02
|
$
|
0.31
|
||||
Income
from discontinued operations, net of gains on
sales
of discontinued businesses (net of income taxes)
|
0.01
|
-
|
0.02
|
0.02
|
|||||||||
Net
income
|
$
|
-
|
$
|
0.13
|
$
|
0.04
|
$
|
0.33
|
|||||
Net
income per diluted share:
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
(0.01
|
)
|
$
|
0.12
|
$
|
0.02
|
$
|
0.30
|
||||
Income
from discontinued operations, net of gains on
sales of
discontinued
businesses (net of income taxes)
|
0.01
|
-
|
0.02
|
0.02
|
|||||||||
Net
income
|
$
|
-
|
$
|
0.12
|
$
|
0.04
|
$
|
0.32
|
|||||
Weighted
average shares outstanding:
|
|||||||||||||
Basic
|
8,381
|
8,485
|
8,346
|
8,486
|
|||||||||
Diluted
|
8,587
|
8,822
|
8,612
|
8,807
|
|||||||||
Dividends declared per common share |
$
|
- | $ | - |
$
|
0.28
|
$
|
- |
Common
Stock
|
Additional
Paid-in
|
Retained
Earnings
(Accumulated
|
Treasury
Stock
|
|||||||||||||||||||
Shares
|
Amount
|
Capital
|
Deficit)
|
Shares
|
Amount
|
Total
|
||||||||||||||||
Balance
at June 30, 2004
|
6,338
|
$
|
6
|
$
|
42,215
|
$
|
(11,834
|
)
|
(125
|
)
|
$
|
(1,021
|
)
|
$
|
29,366
|
|||||||
Issuance
of common stock in public
offering (net of expenses)
|
2,196
|
2
|
35,655
|
-
|
-
|
-
|
35,657
|
|||||||||||||||
Exercise
of stock options
|
71
|
1
|
283
|
-
|
-
|
-
|
284
|
|||||||||||||||
Tax
benefit on exercise of
stock options
|
-
|
-
|
338
|
-
|
-
|
-
|
338
|
|||||||||||||||
Issuances
of stock under stock purchase plan and related compensation
expense
|
5
|
-
|
103
|
-
|
-
|
-
|
103
|
|||||||||||||||
Net
income
|
-
|
-
|
-
|
4,818
|
-
|
-
|
4,818
|
|||||||||||||||
Balance
at June 30, 2005
|
8,610
|
9
|
78,594
|
(7,016
|
)
|
(125
|
)
|
(1,021
|
)
|
70,566
|
||||||||||||
Exercise
of stock options
|
47
|
-
|
243
|
-
|
-
|
-
|
243
|
|||||||||||||||
Stock-based
compensation expense
|
-
|
-
|
670
|
-
|
-
|
-
|
670
|
|||||||||||||||
Tax
benefit on exercise of stock options
|
-
|
-
|
29
|
-
|
-
|
-
|
29
|
|||||||||||||||
Shares
repurchased and cancelled under the
Stock Repurchase Plan
|
(182
|
)
|
(1
|
)
|
(2,627
|
)
|
-
|
-
|
-
|
(2,628
|
)
|
|||||||||||
Net
income
|
-
|
-
|
-
|
3,700
|
-
|
-
|
3,700
|
|||||||||||||||
Dividends
paid to common stockholders
|
-
|
-
|
-
|
(674
|
)
|
-
|
-
|
(674
|
)
|
|||||||||||||
Balance
at June 30, 2006
|
8,475
|
8
|
76,909
|
(3,990
|
)
|
(125
|
)
|
(1,021
|
)
|
71,906
|
||||||||||||
Exercise
of stock options
|
147
|
1
|
228
|
-
|
-
|
-
|
229
|
|||||||||||||||
Tax
benefit on exercise of stock options
|
-
|
-
|
623
|
-
|
-
|
-
|
623
|
|||||||||||||||
Issuances
of restricted stock and related stock-based
compensation expense
|
39
|
-
|
104
|
-
|
-
|
-
|
104
|
|||||||||||||||
Repurchase
of common stock
|
(72
|
)
|
-
|
(949
|
)
|
-
|
-
|
-
|
(949
|
)
|
||||||||||||
Stock-based
compensation expense-options
|
-
|
-
|
557
|
-
|
-
|
-
|
557
|
|||||||||||||||
Dividends
paid to common stockholders
|
-
|
-
|
-
|
(2,332
|
)
|
-
|
-
|
(2,332
|
)
|
|||||||||||||
Retirement
of treasury shares
|
(125
|
)
|
-
|
(1,021
|
)
|
-
|
125
|
1,021
|
-
|
|||||||||||||
Net
income for nine months ended
March 31, 2007
|
-
|
-
|
-
|
325
|
-
|
-
|
325
|
|||||||||||||||
Balance
at March 31, 2007
|
8,464
|
$
|
9
|
$
|
76,451
|
$
|
(5,997
|
)
|
-
|
$
|
-
|
$
|
70,463
|
Nine
Months Ended
March
31,
|
|||||||
2007
|
2006
|
||||||
OPERATING
ACTIVITIES:
|
|||||||
Net
income
|
$
|
325
|
$
|
2,796
|
|||
Adjustments
to reconcile net income to net cash provided by (used in) operating
activities:
|
|||||||
Depreciation
and amortization
|
1,332
|
621
|
|||||
Loss
on disposal of fixed assets
|
-
|
3
|
|||||
Loss
on termination of sublease
|
-
|
83
|
|||||
Stock-based
compensation expense
|
661
|
398
|
|||||
Tax
benefit from exercising of stock options
|
623
|
-
|
|||||
Provision
for bad debts and credits
|
33
|
49
|
|||||
Provision
for inventory write down
|
1
|
47
|
|||||
Discontinued
operations
|
(190
|
)
|
(169
|
)
|
|||
Deferred
income taxes
|
(201
|
)
|
1,485
|
||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable
|
213
|
(32
|
)
|
||||
Inventories
|
(21
|
)
|
(46
|
)
|
|||
Prepaid
expenses and other current assets
|
(602
|
)
|
(302
|
)
|
|||
Income
taxes payable
|
(579
|
)
|
610
|
||||
Other
assets
|
(80
|
)
|
(36
|
)
|
|||
Accounts
payable
|
365
|
(174
|
)
|
||||
Accrued
liabilities
|
(44
|
)
|
-
|
||||
Deferred
rent and other long-term liabilities
|
74
|
(50
|
)
|
||||
Accrued
compensation and benefits
|
133
|
(343
|
)
|
||||
Deferred
revenue
|
295
|
487
|
|||||
Short-term
investments
|
-
|
(7,602
|
)
|
||||
Net
cash provided by (used in) operating activities
|
2,338
|
(2,175
|
)
|
||||
Net
cash provided by operating activities of discontinued
businesses
|
65
|
200
|
|||||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|||||||
Capital
expenditures
|
(2,590
|
)
|
(1,090
|
)
|
|||
Purchase
of businesses, net of cash acquired
|
(6,316
|
)
|
(14,554
|
)
|
|||
Advances
on customer notes receivable
|
(3,052
|
)
|
(3,524
|
)
|
|||
Proceeds
from collection of customer notes receivable
|
4,784
|
1,604
|
|||||
Purchase
of patents and other intangible assets
|
(352
|
)
|
-
|
||||
Capitalized
software
|
(1,184
|
)
|
(121
|
)
|
|||
Cash
received on sale of discontinued businesses
|
324
|
358
|
|||||
Net
cash used in investing activities
|
(8,386
|
)
|
(17,327
|
)
|
|||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|||||||
Proceeds
from exercise of stock options
|
229
|
132
|
|||||
Payments
for retirement of common stock
|
(949
|
)
|
(703
|
)
|
|||
Dividends
paid to common stockholders
|
(2,332
|
)
|
-
|
||||
Net
cash used in financing activities
|
(3,052
|
)
|
(571
|
)
|
|||
Net
decrease in cash and cash equivalents
|
(9,035
|
)
|
(19,873
|
)
|
|||
Cash
and cash equivalents at beginning of period
|
52,110
|
65,439
|
|||||
Cash
and cash equivalents at end of period
|
$
|
43,075
|
$
|
45,566
|
|||
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION:
|
|||||||
Interest
paid
|
$
|
15
|
$
|
12
|
|||
Income
taxes paid
|
$
|
868
|
$
|
93
|
Nine
Months Ended
March
31,
|
|||||||
2007
|
2006
|
||||||
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION (CONTINUED):
|
|||||||
Effective
July 14, 2005, the Company acquired CoinFacts.com in a transaction
summarized
as follows:
|
|||||||
Goodwill
|
$
|
-
|
$
|
515
|
|||
Purchase
price
|
$
|
-
|
$
|
515
|
|||
Effective
September 2, 2005, the Company acquired Certified Coin Exchange
(CCE) in
a transaction summarized as follows:
|
|||||||
Fair
value of net liabilities assumed
|
$
|
-
|
$
|
(18
|
)
|
||
Deferred
taxes recognized at acquisition
|
-
|
(379
|
)
|
||||
Intangible
assets
|
-
|
947
|
|||||
Fair
value of CTP, including net assets
|
-
|
600
|
|||||
Goodwill
|
-
|
1,200
|
|||||
Purchase
price, net of cash acquired
|
$
|
-
|
$
|
2,350
|
|||
Effective
November 8, 2005, the Company acquired Gem Certification & Appraisal
Lab (GCAL) in
a transaction
summarized as follows:
|
|||||||
Fair
value of net assets acquired
|
$
|
-
|
$
|
119
|
|||
Intangible
assets
|
-
|
53
|
|||||
Goodwill
|
-
|
3,067
|
|||||
Purchase
price, net of cash acquired
|
$
|
-
|
$
|
3,239
|
|||
Effective
December 22, 2005, the Company acquired the business of Gemprint
Corporation in
a transaction
summarized
as follows:
|
|||||||
Fair
value of net assets acquired
|
$
|
-
|
$
|
96
|
|||
Intangible
assets
|
-
|
3,444
|
|||||
Goodwill
|
1
|
5,021
|
|||||
Purchase
price, net of cash acquired
|
$
|
1
|
$
|
8,561
|
|||
Effective
July 1, 2006, the Company acquired Expos Unlimited, LLC (Expos) in
a
transaction summarized
as follows:
|
|||||||
Fair
value of net liabilities assumed
|
$
|
(470
|
)
|
$
|
-
|
||
Intangible
assets
|
988
|
-
|
|||||
Goodwill
|
1,907
|
-
|
|||||
Purchase
price, net of cash acquired
|
$
|
2,425
|
$
|
-
|
|||
Effective
August 18, 2006, the Company acquired American Gemological Laboratories,
Inc. (AGL)
in a transaction
summarized as follows:
|
|||||||
Fair
value of net liabilities assumed
|
$
|
(16
|
)
|
$
|
-
|
||
Deferred
tax liability recognized at acquisition
|
(137
|
)
|
-
|
||||
Intangible
assets
|
646
|
-
|
|||||
Goodwill
|
3,397
|
-
|
|||||
Purchase
price, net of cash acquired
|
$
|
3,890
|
$
|
-
|
|||
Business
|
Acquisition
Date
|
Purchase
Price
|
CoinFacts.com
|
July
14, 2005
|
$0.5
million
|
Certified
Coin Exchange
|
September
2, 2005
|
$2.4
million
|
Gem
Certification & Appraisal Lab, LLC
|
November
8, 2005
|
$3.3
million
|
Gemprint
Corporation
|
December
22, 2005
|
$8.6
million
|
Business
|
Acquisition
Date
|
Purchase
Price
|
Expos
Unlimited,
LLC
|
July
1, 2006
|
$2.5
million
|
American
Gemological Laboratories, Inc.
|
August
18, 2006
|
$3.9
million
|
Three
Months Ended
March
31,
(in
thousands)
|
Nine
Months Ended
March
31,
(in
thousands)
|
||||||||||||
2007
|
|
2006
|
|
2007
|
|
2006
|
|||||||
Included
in:
|
|||||||||||||
Cost of revenues
|
$
|
77
|
$
|
56
|
$
|
229
|
$
|
168
|
|||||
Selling
and marketing expenses
|
3
|
1
|
6
|
3
|
|||||||||
General
and administrative expenses(1)
|
161
|
76
|
426
|
227
|
|||||||||
Pre-tax
stock-based compensation expense
|
$
|
241
|
$
|
133
|
$
|
661
|
$
|
398
|
(1)
|
Includes
$66,000 and $104,000 in the three and nine months ended March 31,
2007,
respectively, and $0 for the three and nine months ended March 31,
2006
for amortization of deferred compensation expense related to issuance
of
restricted stock (see below).
|
Three
Months Ended
March
31
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Dividend
yield
|
3.4
|
%
|
-
|
2.5
|
%
|
-
|
|||||||
Expected
volatility
|
49.0
|
%
|
-
|
51.1
|
%
|
61.0
|
%
|
||||||
Risk-free
interest rate
|
4.7
|
%
|
-
|
4.6
|
%
|
3.9
|
%
|
||||||
Expected
lives
|
5.1
yrs.
|
-
|
5.1
yrs.
|
5.1
yrs.
|
Shares
|
Weighted
Average Exercise Price
|
Weighted
Average Remaining Contractual Term
|
Aggregate
Intrinsic
Value
|
||||||||||
Options:
|
|||||||||||||
Outstanding
at June 30, 2006
|
889,000
|
$
|
12.65
|
||||||||||
Granted
|
60,000
|
13.66
|
|||||||||||
Exercised
|
(14,000
|
)
|
3.87
|
||||||||||
Forfeited
or cancelled
|
(13,000
|
)
|
15.08
|
||||||||||
Outstanding
at March 31, 2007
|
922,000
|
$
|
12.82
|
6.64
yrs.
|
$
|
2,642,000
|
|||||||
Exercisable
at March 31, 2007
|
607,000
|
$
|
12.41
|
5.98
yrs.
|
$
|
2,328,000
|
|||||||
Unvested
at March 31, 2007
|
315,000
|
$
|
13.62
|
7.91
yrs.
|
$
|
314,000
|
|||||||
Expect
to vest at March 31, 2007
|
247,000
|
$
|
13.53
|
8.28
yrs.
|
$
|
275,000
|
Non-Vested
Shares:
|
Shares
|
Weighted
Average
Grant-Date
Fair
Value
|
|||||
Non-vested
at June 30, 2006
|
-
|
$
|
-
|
||||
Granted
|
39,260
|
13.63
|
|||||
Vested
|
(3,265
|
)
|
13.40
|
||||
Forfeited
or Cancelled
|
-
|
-
|
|||||
Non-vested
at March 31, 2007
|
35,995
|
$
|
13.65
|
Coins
|
CGAL
&
Gemprint
|
AGL
|
Expos
|
CCE
and
Other
|
Total
|
||||||||||||||
Goodwill:
|
|||||||||||||||||||
Balance
at June 30, 2006
|
$
|
515
|
$
|
8,168
|
$
|
-
|
$
|
-
|
$
|
1,116
|
$
|
9,799
|
|||||||
Acquired
during FY2007:
|
|||||||||||||||||||
AGL
|
-
|
-
|
3,397
|
-
|
-
|
3,397
|
|||||||||||||
Expos
Unlimited
|
-
|
-
|
-
|
1,907
|
-
|
1,907
|
|||||||||||||
Purchase
price adjustment since June 30, 2006:
|
|||||||||||||||||||
Gemprint
|
-
|
1
|
-
|
-
|
-
|
1
|
|||||||||||||
Balance
at March 31, 2007
|
$
|
515
|
$
|
8,169
|
$
|
3,397
|
$
|
1,907
|
$
|
1,116
|
$
|
15,104
|
|||||||
Intangible
Assets, Net:
|
|||||||||||||||||||
Balance
at June 30, 2006
|
$
|
29
|
$
|
3,365
|
$
|
-
|
$
|
-
|
$
|
1,280
|
$
|
4,674
|
|||||||
Acquired
during FY2007 with indefinite lives:
|
|||||||||||||||||||
AGL
Acquisition
|
-
|
-
|
522
|
-
|
-
|
522
|
|||||||||||||
Expos
Unlimited
|
-
|
-
|
-
|
134
|
-
|
134
|
|||||||||||||
Acquired
during FY2007 with definite lives:
|
|||||||||||||||||||
AGL
|
-
|
-
|
124
|
-
|
-
|
124
|
|||||||||||||
Expos
Unlimited
|
-
|
-
|
-
|
854
|
-
|
854
|
|||||||||||||
Diamond
I.D.
|
-
|
332
|
-
|
-
|
-
|
332
|
|||||||||||||
CCE
|
-
|
-
|
-
|
-
|
2
|
2
|
|||||||||||||
Capitalized
software costs during FY2007
|
-
|
-
|
-
|
-
|
1,184
|
1,184
|
|||||||||||||
Less:
amortization for FY2007
|
(29
|
)
|
(220
|
)
|
(14
|
)
|
(66
|
)
|
(248
|
)
|
(577
|
)
|
|||||||
Balance
at March 31, 2007
|
$
|
-
|
$
|
3,477
|
$
|
632
|
$
|
922
|
$
|
2,218
|
$
|
7,249
|
2007
(for Q4)
|
$
|
275,000
|
||
2008
|
$
|
991,000
|
||
2009
|
$
|
966,000
|
||
2010
|
$
|
794,000
|
||
2011
|
$
|
429,000
|
2. |
BUSINESS
ACQUISITIONS
|
Expos
|
AGL
|
DID
|
Total
|
||||||||||
Cost
of Investment:
|
|||||||||||||
Purchase
Price
|
$
|
2,400
|
$
|
3,500
|
$
|
295
|
$
|
6,195
|
|||||
Other
direct costs
|
75
|
181
|
37
|
293
|
|||||||||
Investment
banking fees
|
-
|
50
|
-
|
50
|
|||||||||
Liability
assumed
|
-
|
214
|
-
|
214
|
|||||||||
2,475
|
3,945
|
332
|
6,752
|
||||||||||
Value
Assigned to Assets and Liabilities:
|
|||||||||||||
Current
assets
|
135
|
108
|
-
|
243
|
|||||||||
Current
liabilities
|
(147
|
)
|
(69
|
)
|
-
|
(216
|
)
|
||||||
Customer
deposits
|
(466
|
)
|
-
|
-
|
(466
|
)
|
|||||||
Property,
plant and equipment
|
57
|
-
|
-
|
57
|
|||||||||
Other
assets
|
1
|
-
|
-
|
1
|
|||||||||
Deferred
tax liabilities
|
-
|
(137
|
)
|
-
|
(137
|
)
|
|||||||
Intangible
Assets with Finite Lives:
|
|||||||||||||
Exhibitor
list
|
681
|
-
|
-
|
681
|
|||||||||
Website
|
25
|
25
|
-
|
50
|
|||||||||
Contract
|
49
|
-
|
-
|
49
|
|||||||||
Covenant
not to compete
|
-
|
81
|
32
|
113
|
|||||||||
Patent
|
-
|
-
|
300
|
300
|
|||||||||
Trade
name
|
99
|
18
|
-
|
117
|
|||||||||
Intangible
Assets with Indefinite Lives:
|
|||||||||||||
Database
|
134
|
-
|
-
|
134
|
|||||||||
Reference
set
|
-
|
500
|
-
|
500
|
|||||||||
Customer
list
|
-
|
22
|
-
|
22
|
|||||||||
Excess
of purchase price over fair value of net assets acquired
(goodwill)
|
$
|
1,907
|
$
|
3,397
|
$
|
-
|
$
|
5,304
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Revenue
|
$
|
11,081
|
$
|
10,705
|
$
|
29,849
|
$
|
28,175
|
|||||
Operating
income (loss)
|
(416
|
)
|
1,354
|
(1,161
|
)
|
2,751
|
|||||||
Interest
income, net
|
511
|
520
|
1,603
|
1,418
|
|||||||||
Other
income
|
2
|
10
|
8
|
26
|
|||||||||
Income
before provision for income taxes
|
97
|
1,884
|
450
|
4,195
|
|||||||||
Provision
for income taxes
|
165
|
798
|
328
|
1,799
|
|||||||||
Income
(loss) from continuing operations
|
(68
|
)
|
1,086
|
122
|
2,396
|
||||||||
Income
from discontinued operations
|
99
|
-
|
190
|
182
|
|||||||||
Net
income
|
$
|
31
|
$
|
1,086
|
$
|
312
|
$
|
2,578
|
|||||
Net
income per basic share:
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
(0.01
|
)
|
$
|
0.13
|
$
|
0.01
|
$
|
0.28
|
||||
Income
from discontinued operations
|
$
|
0.01
|
$
|
-
|
$
|
0.03
|
$
|
0.02
|
|||||
Net
income
|
$
|
-
|
$
|
0.13
|
$
|
0.04
|
$
|
0.30
|
|||||
Net
income per diluted share:
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
(0.01
|
)
|
$
|
0.12
|
$
|
0.01
|
$
|
0.27
|
||||
Income
from discontinued operations
|
$
|
0.01
|
$
|
-
|
$
|
0.03
|
$
|
0.02
|
|||||
Net
income
|
$
|
-
|
$
|
0.12
|
$
|
0.04
|
$
|
0.29
|
4. |
INVENTORIES
|
Inventories
consist of the following:
|
|||||||
(in
thousands)
|
|||||||
March
31,
|
June
30,
|
||||||
2007
|
2006
|
||||||
Coins
|
$
|
325
|
$
|
346
|
|||
Other
collectibles
|
31
|
37
|
|||||
Grading
raw materials consumable inventory
|
207
|
160
|
|||||
563
|
543
|
||||||
Less
inventory reserve
|
(96
|
)
|
(106
|
)
|
|||
Inventories,
net
|
$
|
467
|
$
|
437
|
Property
and equipment consist of the following:
|
|||||||
(in
thousands)
|
|||||||
March
31,
|
June
30,
|
||||||
2007
|
2006
|
||||||
Coins,
stamp and diamond grading reference sets
|
$
|
218
|
$
|
62
|
|||
Computer
hardware and equipment
|
1,563
|
1,271
|
|||||
Computer
software
|
1,022
|
972
|
|||||
Equipment
|
3,051
|
2,020
|
|||||
Furniture
and office equipment
|
1,016
|
793
|
|||||
Leasehold
improvements
|
1,497
|
607
|
|||||
Trading
card reference library
|
52
|
52
|
|||||
8,419
|
5,777
|
||||||
Less
accumulated depreciation and amortization
|
(4,499
|
)
|
(3,880
|
)
|
|||
Property and equipment, net
|
$
|
3,920
|
$
|
1,897
|
Accrued
liabilities consist of the following:
|
(in
thousands)
|
||||||
March
31,
|
June
30,
|
||||||
2007
|
2006
|
||||||
Warranty
costs
|
$
|
730
|
$
|
710
|
|||
Professional
fees
|
172
|
189
|
|||||
Other
|
1,143
|
1,144
|
|||||
$
|
2,045
|
$
|
2,043
|
(in
thousands)
|
|||||||
Nine
Months
Ended
March
31,
|
Nine
Months
Ended
March
31,
|
||||||
2007
|
2006
|
||||||
Warranty
reserve, beginning of period
|
$
|
710
|
$
|
609
|
|||
Charged
to cost of revenue
|
288
|
329
|
|||||
Payments
|
(268
|
)
|
(300
|
)
|
|||
Warranty
reserve, end of period
|
$
|
730
|
$
|
638
|
7. |
DISCONTINUED
OPERATIONS
|
(in
thousands)
|
(in
thousands)
|
||||||||||||
Three
Months Ended
March
31,
|
|
Nine
Months Ended
March
31,
|
|||||||||||
2007
|
|
2006
|
|
2007
|
|
2006
|
|||||||
Net
revenues
|
$
|
5
|
$
|
6
|
$
|
54
|
$
|
319
|
|||||
Income
(loss) before income taxes
|
22
|
(14
|
)
|
63
|
44
|
||||||||
Gain
on sale of discontinued businesses
|
101
|
14
|
252
|
313
|
|||||||||
123
|
-
|
315
|
357
|
||||||||||
Income
tax expense
|
(24
|
)
|
-
|
(125
|
)
|
(188
|
)
|
||||||
Income
from discontinued operations
|
$
|
99
|
$
|
-
|
$
|
190
|
$
|
169
|
(in
thousands)
|
|||||||
March
31,
2007
|
June
30,
2006
|
||||||
Current
assets:
|
|||||||
Accounts
receivable
|
$
|
-
|
$
|
10
|
|||
Inventories
|
16
|
37
|
|||||
Notes
receivable
|
38
|
36
|
|||||
$
|
54
|
$
|
83
|
||||
Current
liabilities:
|
|||||||
Consignors
payable
|
$
|
1
|
$
|
1
|
|||
Other
current liabilities
|
6
|
7
|
|||||
$
|
7
|
$
|
8
|
9. |
NET
INCOME PER SHARE
|
(in
thousands)
|
(in
thousands)
|
||||||||||||
Three
Months Ended
March
31,
|
|
Nine
Months Ended
March
31,
|
|||||||||||
2007
|
|
2006
|
|
2007
|
|
2006
|
|||||||
Income
(loss) from continuing operations
|
$
|
(68
|
)
|
$
|
1,094
|
$
|
135
|
$
|
2,627
|
||||
Income
from discontinued operations, net of gain on
sales
of discontinued businesses (net
of income taxes)
|
99
|
-
|
190
|
169
|
|||||||||
Net
income
|
$
|
31
|
$
|
1,094
|
$
|
325
|
$
|
2,796
|
|||||
NET
INCOME PER SHARE-BASIC:
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
(0.01
|
)
|
$
|
0.13
|
$
|
0.02
|
$
|
0.31
|
||||
Income
from discontinued operations, net of gain on
sales
of discontinued businesses (net
of income taxes)
|
$
|
0.01
|
$
|
-
|
$
|
0.02
|
$
|
0.02
|
|||||
Total
|
$
|
-
|
$
|
0.13
|
$
|
0.04
|
$
|
0.33
|
|||||
NET
INCOME PER SHARE-DILUTED:
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
(0.01
|
)
|
$
|
0.12
|
$
|
0.02
|
$
|
0.30
|
||||
Income
from discontinued operations, net of gain on
sales
of discontinued businesses (net
of income taxes)
|
$
|
0.01
|
$
|
-
|
$
|
0.02
|
0.02
|
||||||
Total
|
$
|
-
|
$
|
0.12
|
$
|
0.04
|
$
|
0.32
|
|||||
WEIGHTED
AVERAGE SHARES OUTSTANDING:
|
|||||||||||||
Basic
|
8,381
|
8,485
|
8,346
|
8,486
|
|||||||||
Effect
of dilutive shares
|
206
|
337
|
266
|
321
|
|||||||||
Diluted
|
8,587
|
8,822
|
8,612
|
8,807
|
10. |
BUSINESS
SEGMENTS
|
|
Three
Months Ended
March
31,
|
|
Nine
Months Ended
March
31,
|
||||||||||
Net
revenues from external customers:
|
|
2007
|
|
2006
|
|
2007
|
|
2006
|
|||||
Coins
|
$
|
6,793
|
$
|
6,511
|
$
|
17,279
|
$
|
16,814
|
|||||
Sportscards
|
2,156
|
2,177
|
6,507
|
6,247
|
|||||||||
Jewelry
|
270
|
172
|
936
|
255
|
|||||||||
Other
|
1,862
|
1,162
|
5,050
|
2,978
|
|||||||||
Total
revenue
|
$
|
11,081
|
$
|
10,022
|
$
|
29,772
|
$
|
26,294
|
|||||
Amortization
and depreciation:
|
|||||||||||||
Coins
|
$
|
72
|
$
|
27
|
$
|
148
|
$
|
76
|
|||||
Sportscards
|
22
|
15
|
64
|
52
|
|||||||||
Jewelry
|
190
|
87
|
477
|
92
|
|||||||||
Other
|
121
|
157
|
408
|
198
|
|||||||||
Total
|
405
|
286
|
1,097
|
418
|
|||||||||
Unallocated
amortization and depreciation
|
75
|
74
|
235
|
203
|
|||||||||
Consolidated
amortization and depreciation
|
$
|
480
|
$
|
360
|
$
|
1,332
|
$
|
621
|
|||||
Stock-based
compensation:
|
|||||||||||||
Coins
|
$
|
55
|
$
|
29
|
$
|
168
|
$
|
88
|
|||||
Sportscards
|
3
|
2
|
23
|
7
|
|||||||||
Jewelry
|
2
|
-
|
4
|
-
|
|||||||||
Other
|
25
|
32
|
76
|
94
|
|||||||||
Total
|
85
|
63
|
271
|
189
|
|||||||||
Unallocated
stock-based compensation
|
156
|
70
|
390
|
209
|
|||||||||
Consolidated
stock-based compensation
|
$
|
241
|
$
|
133
|
$
|
661
|
$
|
398
|
|||||
Operating
income (loss) before unallocated expenses:
|
|||||||||||||
Coins
|
$
|
2,976
|
$
|
3,192
|
$
|
7,098
|
$
|
7,945
|
|||||
Sportscards
|
292
|
328
|
1,044
|
686
|
|||||||||
Jewelry
|
(1,845
|
)
|
(541
|
)
|
(3,387
|
)
|
(589
|
)
|
|||||
Other
|
186
|
3
|
333
|
(29
|
)
|
||||||||
Total
|
1,609
|
2,982
|
5,088
|
8,013
|
|||||||||
Unallocated
operating expenses
|
(2,025
|
)
|
(1,680
|
)
|
(6,249
|
)
|
(5,183
|
)
|
|||||
Consolidated
operating income (loss)
|
$
|
(416
|
)
|
$
|
1,302
|
$
|
(1,161
|
)
|
$
|
2,830
|
At
March 31,
|
At
June 30,
|
||||||
Identifiable
Assets:
|
2007
|
2006
|
|||||
Coins
|
$
|
2,385
|
$
|
2,647
|
|||
Sportscards
|
646
|
541
|
|||||
Jewelry
|
19,035
|
12,611
|
|||||
Other
|
7,923
|
6,284
|
|||||
Total
|
29,989
|
22,083
|
|||||
Unallocated
assets
|
47,749
|
56,138
|
|||||
Consolidated
assets
|
$
|
77,738
|
$
|
78,221
|
At
March 31,
|
At
June 30,
|
||||||
Goodwill:
|
2007
|
2006
|
|||||
Coins
|
$
|
515
|
$
|
515
|
|||
Jewelry
|
11,566
|
8,168
|
|||||
Other
|
3,023
|
1,116
|
|||||
Consolidated
goodwill
|
$
|
15,104
|
$
|
9,799
|
11. |
LINE
OF CREDIT
|
12. |
LEGAL MATTERS
|
13. |
SUBSEQUENT EVENT
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Net
revenues
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
|||||
Cost
of revenues
|
46.4
|
%
|
40.8
|
%
|
46.6
|
%
|
40.2
|
%
|
|||||
Gross
profit
|
53.6
|
%
|
59.2
|
%
|
53.4
|
%
|
59.8
|
%
|
|||||
Operating
expenses:
|
|||||||||||||
Selling
and marketing expenses
|
21.8
|
%
|
13.7
|
%
|
17.1
|
%
|
12.9
|
%
|
|||||
General
and administrative expenses
|
33.6
|
%
|
31.5
|
%
|
38.3
|
%
|
35.5
|
%
|
|||||
Amortization
of intangible assets
|
2.0
|
%
|
1.0
|
%
|
1.9
|
%
|
0.6
|
%
|
|||||
Total
operating expenses
|
57.4
|
%
|
46.2
|
%
|
57.3
|
%
|
49.0
|
%
|
|||||
Operating
income (loss)
|
(3.8
|
%)
|
13.0
|
%
|
(3.9
|
%)
|
10.8
|
%
|
|||||
Interest
income, net
|
4.6
|
%
|
5.9
|
%
|
5.5
|
%
|
6.6
|
%
|
|||||
Other
income
|
0.1
|
%
|
0.1
|
%
|
-
|
0.1
|
%
|
||||||
Income
before provision for income taxes
|
0.9
|
%
|
19.0
|
%
|
1.6
|
%
|
17.5
|
%
|
|||||
Provision
for income taxes
|
1.5
|
%
|
8.0
|
%
|
1.1
|
%
|
7.5
|
%
|
|||||
Income
from continuing operations after income taxes
|
(0.6
|
%)
|
11.0
|
%
|
0.5
|
%
|
10.0
|
%
|
|||||
Income
from discontinued operations, net of gain on sales
of
discontinued businesses (net of income taxes)
|
0.9
|
%
|
-
|
0.6
|
%
|
0.6
|
%
|
||||||
Net
income
|
0.3
|
%
|
11.0
|
%
|
1.1
|
%
|
10.6
|
%
|
Units
Processed
Three
Months Ended March 31,
|
Declared
Value (000)
Three
Months Ended March 31,
|
||||||||||||||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||||||||||||||
Coins
|
400,000
|
50.0
|
%
|
474,000
|
56.0
|
%
|
$
|
365,597
|
84.0
|
%
|
$
|
577,693
|
93.0
|
%
|
|||||||||||
Sportscards
|
321,600
|
41.0
|
%
|
315,000
|
37.0
|
%
|
22,503
|
5.0
|
%
|
18,288
|
3.0
|
%
|
|||||||||||||
Autographs
|
39,800
|
5.0
|
%
|
45,000
|
5.0
|
%
|
5,488
|
1.0
|
%
|
3,845
|
1.0
|
%
|
|||||||||||||
Stamps
|
16,900
|
2.0
|
%
|
10,000
|
1.0
|
%
|
3,077
|
1.0
|
%
|
5,430
|
1.0
|
%
|
|||||||||||||
Currency
|
9,000
|
1.0
|
%
|
9,000
|
1.0
|
%
|
8,201
|
2.0
|
%
|
8,208
|
1.0
|
%
|
|||||||||||||
Diamonds*
|
5,100
|
1.0
|
%
|
1,000
|
-
|
17,661
|
4.0
|
%
|
9,740
|
1.0
|
%
|
||||||||||||||
Colored
Gemstones*
|
800
|
-
|
-
|
-
|
13,924
|
3.0
|
%
|
-
|
-
|
||||||||||||||||
Total
|
793,200
|
100.0
|
%
|
854,000
|
100.0
|
%
|
$
|
436,451
|
100.0
|
%
|
$
|
623,204
|
100.0
|
%
|
Units
Processed
Nine
Months Ended March 31,
|
Declared
Value (000)
Nine
Months Ended March 31,
|
||||||||||||||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||||||||||||||
Coins
|
1,162,700
|
50.0
|
%
|
1,226,000
|
54.0
|
%
|
$
|
1,153,192
|
83.0
|
%
|
$
|
1,208,616
|
91.0
|
%
|
|||||||||||
Sportscards
|
938,700
|
41.0
|
%
|
873,000
|
38.0
|
%
|
66,666
|
5.0
|
%
|
53,358
|
4.0
|
%
|
|||||||||||||
Autographs
|
117,800
|
5.0
|
%
|
134,000
|
6.0
|
%
|
20,114
|
1.0
|
%
|
11,341
|
1.0
|
%
|
|||||||||||||
Stamps
|
47,200
|
2.0
|
%
|
26,200
|
1.0
|
%
|
8,433
|
1.0
|
%
|
13,752
|
1.0
|
%
|
|||||||||||||
Currency
|
25,200
|
1.0
|
%
|
23,300
|
1.0
|
%
|
24,096
|
2.0
|
%
|
31,433
|
2.0
|
%
|
|||||||||||||
Diamonds*
|
20,000
|
1.0
|
%
|
2,000
|
-
|
74,795
|
5.0
|
%
|
19,703
|
1.0
|
%
|
||||||||||||||
Colored
Gemstones*
|
1,000
|
-
|
-
|
-
|
44,111
|
3.0
|
%
|
-
|
-
|
||||||||||||||||
Total
|
2,312,600
|
100.0
|
%
|
2,284,500
|
100.0
|
%
|
$
|
1,391,407
|
100.0
|
%
|
$
|
1,338,203
|
100.0
|
%
|
Three
Months Ended March 31,
|
|||||||||||||||||||
2007
|
2006
|
Increase
|
|||||||||||||||||
Amount
|
%
of Net
Revenues
|
Amount
|
%
of Net
Revenues
|
Amount
|
%
of Net
Revenues
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
Grading
and authentication fees
|
$
|
9,526
|
86.0
|
%
|
$
|
8,981
|
89.6
|
%
|
$
|
545
|
6.1
|
%
|
|||||||
Other
related services
|
1,555
|
14.0
|
%
|
1,041
|
10.4
|
%
|
514
|
49.4
|
%
|
||||||||||
Total
net revenues
|
$
|
11,081
|
100.0
|
%
|
$
|
10,022
|
100.0
|
%
|
$
|
1,059
|
10.6
|
%
|
Nine
Months Ended March 31,
|
|||||||||||||||||||
2007
|
2006
|
Increase
|
|||||||||||||||||
Amount
|
%
of Net
Revenues
|
Amount
|
%
of Net
Revenues
|
Amount
|
%
of Net
Revenues
|
||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||
Grading
and authentication fees
|
$
|
25,296
|
85.0
|
%
|
$
|
23,637
|
89.9
|
%
|
$
|
1,659
|
7.0
|
%
|
|||||||
Other
related services
|
4,476
|
15.0
|
%
|
2,657
|
10.1
|
%
|
1,819
|
68.5
|
%
|
||||||||||
Total
net revenues
|
$
|
29,772
|
100.0
|
%
|
$
|
26,294
|
100.0
|
%
|
$
|
3,478
|
13.2
|
%
|
Three
Months Ended March 31,
|
|||||||||||||||||||||||||
2007
|
2006
|
2007
vs. 2006
|
|||||||||||||||||||||||
Increase
(Decrease)
|
|||||||||||||||||||||||||
|
%
of Net
|
|
|
|
%
of Net
|
|
Revenues
|
|
Units
Processed
|
||||||||||||||||
Amount
|
Revenues
|
Amount
|
Revenues
|
Amounts
|
Percent
|
Number
|
Percent
|
||||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||||
Coins
|
$
|
6,793
|
61.3
|
%
|
$
|
6,511
|
65.0
|
%
|
$
|
282
|
4.3
|
%
|
(74,000
|
)
|
(15.6
|
%)
|
|||||||||
Sportscards
|
2,156
|
19.5
|
%
|
2,177
|
21.7
|
%
|
(21
|
)
|
(1.0
|
%)
|
6,600
|
2.1
|
%
|
||||||||||||
Other
(1)
|
2,132
|
19.2
|
%
|
1,334
|
13.3
|
%
|
798
|
59.8
|
%
|
6,600
|
10.2
|
%
|
|||||||||||||
Net
Revenues
|
$
|
11,081
|
100.0
|
%
|
$
|
10,022
|
100.0
|
%
|
$
|
1,059
|
10.6
|
%
|
(60,800
|
)
|
(7.1
|
%)
|
Nine
Months Ended March 31,
|
|||||||||||||||||||||||||
2007
|
2006
|
2007
vs. 2006
|
|||||||||||||||||||||||
Increase
(Decrease)
|
|||||||||||||||||||||||||
%
of Net
|
|
|
|
%
of Net
|
|
Revenues
|
|
Units
Processed
|
|||||||||||||||||
Amount
|
Revenues
|
Amount
|
Revenues
|
Amounts
|
Percent
|
Number
|
Percent
|
||||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||||
Coins
|
$
|
17,279
|
58.0
|
%
|
$
|
16,814
|
63.9
|
%
|
$
|
465
|
2.8
|
%
|
(63,300
|
)
|
(5.2
|
%)
|
|||||||||
Sportscards
|
6,507
|
21.9
|
%
|
6,247
|
23.8
|
%
|
260
|
4.2
|
%
|
65,700
|
7.5
|
%
|
|||||||||||||
Other
(1)
|
5,986
|
20.1
|
%
|
3,233
|
12.3
|
%
|
2,753
|
85.1
|
%
|
25,700
|
14.0
|
%
|
|||||||||||||
Net
Revenues
|
$
|
29,772
|
100.0
|
%
|
$
|
26,294
|
100.0
|
%
|
$
|
3,478
|
13.2
|
%
|
28,100
|
1.2
|
%
|
(1)
|
Consists
of revenues from the authentication and grading of autographs, stamps,
currency businesses and our CFC dealer financing business during
all
periods presented. Also includes revenues from (i) the CCE
subscription business from September 2, 2005, (ii) the authentication
and
grading of diamonds from November 2005, when we completed our acquisition
of GCAL, (iii) the collectibles convention business from July 2006,
when we completed our acquisition of Expos, and (iv) the
authentication and grading of colored gemstones from August 2006,
when we
completed our acquisition of AGL.
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Gross
profit
|
$
|
5,943,000
|
$
|
5,934,000
|
$
|
15,911,000
|
$
|
15,716,000
|
|||||
Gross
profit margin
|
53.6
|
%
|
59.2
|
%
|
53.4
|
%
|
59.8
|
%
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Selling
and marketing expenses
|
$
|
2,411,000
|
$
|
1,378,000
|
$
|
5,106,000
|
$
|
3,386,000
|
|||||
Percent
of net revenue
|
21.8
|
%
|
13.7
|
%
|
17.1
|
%
|
12.9
|
%
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
General
and administrative expenses
|
$
|
3,729,000
|
$
|
3,152,000
|
$
|
11,389,000
|
$
|
9,343,000
|
|||||
Percent
of net revenues
|
33.6
|
%
|
31.5
|
%
|
38.3
|
%
|
35.5
|
%
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Amortization
expense
|
$
|
219,000
|
$
|
102,000
|
$
|
577,000
|
$
|
157,000
|
|||||
Percent
of net revenues
|
2.0
|
%
|
1.0
|
%
|
1.9
|
%
|
0.6
|
%
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
Included
in:
|
2007
|
2006
|
2007
|
2006
|
|||||||||
Cost
of revenues
|
$
|
77,000
|
$
|
56,000
|
$
|
229,000
|
$
|
168,000
|
|||||
Selling
and marketing expenses
|
3,000
|
1,000
|
6,000
|
3,000
|
|||||||||
General
and administrative expenses
|
161,000
|
76,000
|
426,000
|
227,000
|
|||||||||
$
|
241,000
|
$
|
133,000
|
$
|
661,000
|
$
|
398,000
|
FY
2007 (Q4)
|
$
|
245,000
|
||
FY
2008
|
854,000
|
|||
FY
2009
|
486,000
|
|||
FY
2010
|
175,000
|
|||
FY
2011
|
38,000
|
|||
Total
|
$
|
1,798,000
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Interest
income, net
|
$
|
511,000
|
$
|
588,000
|
$
|
1,624,000
|
$
|
1,738,000
|
|||||
Percent
of net revenue
|
4.6
|
%
|
5.9
|
%
|
5.5
|
%
|
6.6
|
%
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Income
tax expense
|
$
|
165,000
|
$
|
804,000
|
$
|
336,000
|
$
|
1,965,000
|
|||||
Percent
of net revenues
|
1.5
|
%
|
8.0
|
%
|
1.1
|
%
|
7.5
|
%
|
Three
Months Ended
March
31,
|
Nine
Months Ended
March
31,
|
||||||||||||
2007
|
2006
|
2007
|
2006
|
||||||||||
Income
from discontinued operations, net of gain on sales of discontinued
businesses (net of income taxes).
|
$
|
99,000
|
$
|
-
|
$
|
190,000
|
$
|
169,000
|
|||||
Percent
of net revenues
|
0.9
|
%
|
0.0
|
% |
0.6
|
%
|
0.6
|
%
|
Fiscal
Year
|
||||
2007 (remaining
3 months)
|
$
|
443,000
|
||
2008
|
1,693,000
|
|||
2009
|
1,710,000
|
|||
2010
|
804,000
|
|||
2011
|
364,000
|
|||
Thereafter
|
1,756,000
|
|||
$
|
6,770,000
|
Dividend
|
Amounts
|
||||||||||||
Declaration
Date
|
|
Record
Date
|
|
Payment
Date
|
|
Per
Share
|
|
Total
|
|||||
May
31, 2006
|
June
14, 2006
|
|
|
June
28, 2006
|
$
|
0.08
|
$
|
674,000
|
|||||
August
15, 2006
|
August
29, 2006
|
|
|
September
12, 2006
|
$
|
0.08
|
$
|
668,000
|
|||||
November
15, 2006
|
November
29, 2006
|
|
|
December
13, 2006
|
$
|
0.08
|
$
|
665,000
|
|||||
December
4, 2006
|
January
3, 2007
|
|
|
January
17, 2007
|
$
|
0.12
|
$
|
999,000
|
|||||
May
10, 2007
|
May
24, 2007
|
|
|
June
7, 2007
|
$
|
0.12
|
$
|
1,016,000
|
· |
changes
in general economic conditions or changes in conditions in the
collectibles or high-value assets markets in which we operate, such
as a
possible decline in the popularity of some high-value collectibles
or
assets, either of which could reduce the volume of authentication
and
grading submissions and, therefore, the grading fees we generate;
|
· |
a
lack of diversity in our sources of revenues and, more particularly,
our
dependence on collectible coin authentication and grading for a
significant percentage of our total revenues, which makes us more
vulnerable to adverse changes in economic conditions, including declines
in the value of precious metals or recessionary or other conditions
that
could lead to reduced coin and other collectibles submissions that
would,
in turn, result in reductions in our revenues and income;
|
· |
our
dependence on certain key executives and experts, the loss of the
services
of any of which could adversely affect our ability to obtain
authentication and grading submissions and, therefore, could harm
our
operating results;
|
· |
the
fact that for the year ended June 30, 2006 and the three and nine
months
ended March 31, 2007 our top 5 customers accounted for approximately
22%
and 15%, respectively, of our net revenues, which means that the
loss of
any of those customers, or a reduction in their grading submissions
to us,
would result in a decline in our revenues and a reduction in our
operating
income;
|
· |
increased
competition from other collectibles’ authentication and grading companies
that could result in reductions in collectibles submissions to us
or could
require us to reduce the prices we charge for our services, either
of
which could result in reductions in our revenue and income;
|
· |
the
risk that we will incur unanticipated liabilities under our authentication
and grading warranties that would increase our operating expenses;
|
· |
the
risk that new collectibles service offerings and business initiatives,
such as stamp and paper currency grading services, diamonds and colored
gemstones, and our dealer financing program, will not gain market
acceptance or will be unsuccessful and will, as a result, increase
our
operating expenses and reduce our overall profitability or cause
us to
incur losses;
|
· |
the
risks involved in acquiring existing or commencing new authentication
and
grading businesses, including the risks that we will be unable to
successfully integrate new businesses into our operations; that our
new
businesses (in particular our diamond and colored gemstone businesses)
may
not gain market acceptance; that business expansion may result in
a costly
diversion of management time and resources from our existing businesses
and increase our operating expenses; that acquisition-related goodwill
and
intangible assets may become impaired, which could adversely impact
our
financial statements and results of operations; and that we will
not
achieve adequate returns on the investments we may make in acquiring
other
or establishing new businesses, any of which would harm our profitability
or cause us to incur losses;
|
· |
the
risks that we will encounter problems with or failures of our computer
systems that would interrupt our services or result in loss of data
that
we need for our business; and
|
· |
the
potential of increased government regulation of our businesses that
could
cause operating costs to increase.
|
(a)
|
Exhibits:
|
|
Exhibit
31.1
|
Certification
of Chief Executive Officer Under Section 302 of the Sarbanes-Oxley
Act of
2002
|
|
Exhibit
31.2
|
Certification
of Chief Financial Officer Under Section 302 of the Sarbanes-Oxley
Act of
2002
|
|
Exhibit
32.1
|
Chief
Executive Officer Certification Under Section 906 of the Sarbanes-Oxley
Act of 2002
|
|
Exhibit
32.2
|
Chief
Financial Officer Certification Under Section 906 of the Sarbanes-Oxley
Act of 2002
|
COLLECTORS
UNIVERSE, INC.
|
||
Date: May
10, 2007
|
/s/
MICHAEL R. HAYNES
|
|
Michael
R. Haynes
|
||
Chief
Executive Officer
|
COLLECTORS
UNIVERSE, INC.
|
||
Date: May
10, 2007
|
/s/
JOSEPH J. WALLACE
|
|
Joseph
J. Wallace
|
||
Chief
Financial Officer
|
Number
|
Description
|
Exhibit
31.1
|
Certification
of Chief Executive Officer Under Section 302 of the Sarbanes-Oxley
Act of
2002
|
Exhibit
31.2
|
Certification
of Chief Financial Officer Under Section 302 of the Sarbanes-Oxley
Act of
2002
|
Exhibit
32.1
|
Chief
Executive Officer Certification Under Section 906 of the Sarbanes-Oxley
Act of 2002
|
Exhibit
32.2
|
Chief
Financial Officer Certification Under Section 906 of the Sarbanes-Oxley
Act of 2002
|