GAAP loss per diluted share narrows
GAAP Net Loss of $11.5 million verse $8.2 million in the prior quarter
Adjusted EBITDA loss improves by $2 million
Cash Provided by Operations improves by 13%
ATLANTA, May 12, 2010 (GLOBE NEWSWIRE) -- Premier Exhibitions, Inc. (Nasdaq:PRXI), a premier developer of touring museum-quality exhibits, today announced financial results for the fourth quarter and full fiscal year ended February 28, 2010.
Highlights for the fourth quarter of fiscal 2010 versus the prior year period included:
- Total revenue increased $0.2 million to $10.3 million despite fewer shows on tour indicating improved fourth quarter productivity.
- Gross profit remained flat at $2.8 million.
- General and Administrative expenses decreased 41% to $5.2 million driven primarily by lower compensation expense and savings related to legal and professional fees.
- GAAP loss per diluted share narrowed to ($0.25) from ($0.28) a year ago. During the period the GAAP net loss was ($11.5) million including ($7.5) million in charges representing one of the last of the legacy issues. The charges included $4.4 million for the restructuring of a ten year lease at the Luxor Resort and Casino in Las Vegas, NV and a $3.1 million tax expense incurred related to the GAAP valuation of the Company's Net Operating Loss carry-forward.
- Adjusted EBITDA, a non-GAAP measure (1), improved by $2 million to a loss of ($2.2) million. (1) Reconciled GAAP and non-GAAP financial measures are provided in the tables below.
- Cash provided by operations improved 13% to $3.5 million.
- On February 28, 2010, total cash and investments were $13.6 million. The Company currently has approximately $13.9 million in cash and marketable securities on hand and no debt.
- Total days of operation decreased 10% to 1,412 for the period, primarily reflecting management's decision to eliminate the Star Trek Exhibition and one Dialog in the Dark Exhibition in fiscal 2010.
- Average daily attendance decreased 22% to 590, as total attendance for the period decreased 30% to 833,150. These results were in line with reduced days of operation.
Chris Davino, Premier Exhibition's Chief Executive Officer, stated, "Our strategic and financial turnaround is well underway as evidenced by increased revenue on fewer operating days, a significant improvement in our adjusted EBITDA loss, and increasing cash balances. Although we would have liked to see better GAAP performance for the period, we understand the need to incur these non-cash charges and take another step toward resolving legacy issues." Davino continued, "Looking forward, we are cautiously optimistic about fiscal 2011 as we invest in new content and transform our business model to one that stresses profitability. As part of that effort, we believe Premier Exhibitions is ideally positioned for new market opportunities that complement our exhibition business, and we look forward to updating our growing shareholder base on developments throughout the year."
John Stone, Premier's Chief Financial Officer, said, "Adjusted EBITDA is the measure that we believe best reflects the underlying operating health of our business and we were pleased to see improvement in the fourth quarter. Simply put, we believe continued progress on this line item will be a key determinant of our equity value going forward. To that point, as we shift our model to one that's more bottom-line oriented, we will continue to be prudent with our capital and evaluate more efficient ways to capture the public's imagination, increase attendance at our exhibitions, and maximize profit we derive from each visitor."
4Q10 Conference Call Information
Company management will host its fourth quarter fiscal 2010 conference call on May 13, 2010 at 9:00 a.m. (EDT). Interested parties can access the call by dialing 1 (877) 723-9523 in the U.S. and 1 (719) 325-4879 internationally. Callers should reference confirmation code 4134557. A transcript of the conference call will be made available on the Company's website: www.prxi.com.
(1) Adjusted EBITDA
See Table 4 below for reconciliations of Adjusted EBITDA to GAAP Net income (loss).
This press release contains certain financial measures that are not prepared in accordance with GAAP (generally accepted accounting principles in the U.S.). Such financial measures are referred to herein as "non-GAAP" and are presented in this press release in accordance with Regulation G as promulgated by the Securities and Exchange Commission. A reconciliation of each such non-GAAP measure to its most directly comparable GAAP financial measure, together with an explanation of why management believes each such non-GAAP financial measure provides useful information to investors, is provided below.
Adjusted EBITDA is a non-GAAP financial measure that the Company defines as earnings before certain unusual and/or non-cash charges, depreciation and amortization, loss (gain) on sale of operating assets, impairment of intangible assets and goodwill, and non-cash compensation expenses. The Company uses Adjusted EBITDA to evaluate the performance of its operating segments. The Company believes that information about Adjusted EBITDA assists investors by allowing them to evaluate changes in the operating results of the Company's portfolio of businesses separate from non-operational factors that affect net income, thus providing insights into both operations and the other factors that affect reported results. Adjusted EBITDA is not calculated or presented in accordance with GAAP. A limitation on the use of Adjusted EBITDA as a performance measure is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenue in the Company's business. Accordingly, Adjusted EBITDA should be considered in addition to, and not as a substitute for, operating income (loss), net income (loss), and other measures of financial performance reported in accordance with GAAP. Furthermore, this measure may vary among other companies. Therefore, Adjusted EBITDA as presented herein may not be comparable to similarly titled measures of other companies.
About Premier Exhibitions
Premier Exhibitions, Inc. (Nasdaq:PRXI) develops and tours museum quality exhibitions. Presently the Company operates and/or presents and promotes three different types of exhibitions:
-
"Titanic: The Artifact Exhibition," and "Titanic Aquatic;"
-
"Bodies…The Exhibition," and "Bodies Revealed;"
- "Dialog in the Dark."
Additional information about Premier Exhibitions is available at www.prxi.com.
Forward Looking Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve certain risks and uncertainties. The actual results or outcomes of Premier Exhibitions, Inc. may differ materially from those anticipated. Although Premier Exhibitions believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any such assumptions could prove to be inaccurate. Therefore, Premier Exhibitions can provide no assurance that any of the forward-looking statements contained in this press release will prove to be accurate.
In light of the significant uncertainties and risks inherent in the forward-looking statements included in this press release, such information should not be regarded as a representation by Premier Exhibitions that its objectives or plans will be achieved. Included in these uncertainties and risks are, among other things, fluctuations in operating results, general economic conditions, uncertainty regarding the results of certain legal proceedings and competition. Forward-looking statements consist of statements other than a recitation of historical fact and can be identified by the use of forward-looking terminology such as "may," "intend," "expect," "will," "anticipate," "estimate" or "continue" or the negatives thereof or other variations thereon or comparable terminology. Because they are forward-looking, such statements should be evaluated in light of important risk factors and uncertainties. These risk factors and uncertainties are more fully described in Premier Exhibitions' most recent Annual and Quarterly Reports filed with the Securities and Exchange Commission, including under the heading entitled "Risk Factors." Premier Exhibitions does not undertake an obligation to update publicly any of its forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
| Table 1 | ||||
| Premier Exhibitions, Inc. | ||||
| Consolidated Balance Sheets | ||||
| (in thousands, except share data) | ||||
| February 28, | ||||
| Audited | ||||
| 2010 | 2009 | |||
| ASSETS | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ 10,339 | $ 4,685 | ||
| Certificates of deposit and other investments | 3,308 | 1,277 | ||
|
Accounts receivable, net of allowance for doubtful accounts of $697 and $1,193, respectively |
2,613 | 5,071 | ||
|
Merchandise inventory, net of reserve of $281 and $143, respectively |
845 | 431 | ||
| Income taxes receivable | 3,161 | 3,806 | ||
| Deferred income taxes | -- | 1,408 | ||
| Prepaid expenses and other current assets | 1,866 | 4,686 | ||
| Total current assets | 22,132 | 21,364 | ||
| Artifacts owned, at cost | 3,048 | 3,081 | ||
| Salvor's lien | 1 | 1 | ||
|
Property and equipment, net of accumulated depreciation of $11,453 and $7,503, respectively |
13,545 | 15,706 | ||
|
Exhibition licenses, net of accumulated amortization of $4,979 and $4,646, respectively |
3,269 | 7,225 | ||
| Goodwill, net | -- | 2,567 | ||
| Deferred income taxes | 927 | 2,685 | ||
| Other assets | 829 | 1,146 | ||
| $ 43,751 | $ 53,775 | |||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
| Current liabilities: | ||||
| Accounts payable and accrued liabilities | 5,518 | 11,712 | ||
| Deferred revenue | 1,705 | 2,340 | ||
| Total current liabilities | 7,223 | 14,052 | ||
| Long-Term liabilities: | ||||
| Lease abandonment | 3,666 | -- | ||
| Income taxes payable | 1,214 | 1,166 | ||
| Total long-term liabilities | 4,880 | 1,166 | ||
| Shareholders' equity: | ||||
|
Common stock; $.0001 par value; authorized 65,000,000 shares; issued 47,804,742 and 31,547,897 shares, respectively; outstanding 46,738,293 and 30,481,448 shares, respectively |
5 | 3 | ||
| Additional paid-in capital | 57,759 | 44,691 | ||
| (Accumulated deficit) retained earnings | (18,613) | 1,384 | ||
| Accumulated other comprehensive loss | (313) | (331) | ||
| Less treasury stock, at cost; 1,066,449 shares | (7,190) | (7,190) | ||
| Total shareholders' equity | 31,648 | 38,557 | ||
| $ 43,751 | $ 53,775 | |||
| Table 2 | ||||
| Premier Exhibitions, Inc. | ||||
| Condensed Consolidated Statements of Operations | ||||
| (in thousands, except share and per share data) | ||||
| Three Months Ended | Twelve Months Ended | |||
| Audited | ||||
| February 28, | February 28, | February 28, | February 28, | |
| 2010 | 2009 | 2010 | 2009 | |
| 4Q10 | 4Q09 | FY10 | FY09 | |
| Revenue: | ||||
| Exhibition revenues | $ 9,482 | $ 9,549 | $ 39,784 | $ 46,722 |
| Merchandise and other | 867 | 555 | 3,644 | 7,171 |
| Total revenue | 10,349 | 10,104 | 43,428 | 53,893 |
| Cost of revenue: | ||||
| Exhibition costs | 7,181 | 7,260 | 22,842 | 28,406 |
| Cost of merchandise | 423 | 87 | 1,228 | 2,835 |
|
Total cost of revenue (exclusive of depreciation and amortization shown separately below) |
7,604 | 7,347 | 24,070 | 31,241 |
| Gross profit | 2,745 | 2,757 | 19,358 | 22,652 |
| Operating expenses: | ||||
| General and administrative | 5,181 | 8,763 | 24,636 | 27,926 |
| Net (gain) loss on disposal of assets | (34) | 941 | (54) | 2,132 |
| Lease abandonment | 4,351 | -- | 4,351 | -- |
| Impairment of intangibles and goodwill | -- | 2,849 | 4,512 | 1,663 |
| Depreciation and amortization | 1,655 | 1,250 | 6,012 | 4,941 |
| Total operating expenses | 11,154 | 13,803 | 39,457 | 36,662 |
| Loss from operations | (8,409) | (11,046) | (20,099) | (14,010) |
| Other (expense) income | 5 | (117) | (250) | 182 |
| Loss before benefit from income taxes | (8,404) | (11,163) | (20,349) | (13,828) |
| Provision (benefit) from income taxes | 3,106 | (2,956) | 352 | 3,806 |
| Net loss | $ (11,510) | $ (8,207) | $ (19,997) | $ (10,022) |
| Basic and diluted loss per common share | $ (0.25) | $ (0.28) | $ (0.54) | $ (0.34) |
| Shares used in basic and diluted per share calculations | 46,691,549 | 29,333,332 | 36,841,296 | 29,213,768 |
| Table 3 | ||||||
| Premier Exhibitions, Inc. | ||||||
| Condensed Consolidated Statements of Cash Flows | ||||||
| (in thousands) | ||||||
| Three Months Ended | Twelve Months Ended | |||||
| February 28, | February 28, | |||||
| Audited | ||||||
| 2010 | 2009 | 2010 | 2009 | |||
| Cash flows from operating activities: | ||||||
| Net loss | $ (11,510) | $ (8,207) | $ (19,997) | $ (10,022) | ||
|
Adjustments to reconcile net income to net cash provided (used) by operating activities: |
||||||
| Depreciation and amortization | 1,656 | 1,154 | 6,013 | 4,850 | ||
| Stock based compensation | (17) | 1,828 | 451 | 1,428 | ||
| Allowance for doubtful accounts | 92 | 339 | (496) | 815 | ||
| Lease abandonment | 4,351 | -- | 4,351 | -- | ||
| Impairment of intangibles | -- | 1,663 | 4,512 | 1,663 | ||
| Excess tax benefit on the exercise of employee stock options | (61) | 110 | (61) | 140 | ||
| Net (gain) loss on disposal of assets | (54) | 2,132 | (54) | 2,132 | ||
| Common stock issued for settlement of lawsuit | -- | -- | 50 | -- | ||
| Common stock issued for accrued interest | -- | -- | 247 | -- | ||
| Changes in operating assets and liabilities: | ||||||
| Decrease (increase) in accounts receivable | 401 | 1,825 | 3,000 | (2,281) | ||
| Decrease (ncrease) in merchandise inventories | (96) | 458 | (414) | (899) | ||
| (Increase) decrease in deferred income taxes | 3,237 | (1,571) | 3,273 | (1,693) | ||
| Decrease (increase) in prepaid expenses and other assets | 1,550 | (318) | 3,076 | 337 | ||
| Decrease (increase) in income tax receivable | 3,549 | (520) | 645 | (3,791) | ||
| Decrease (Increase) in deferred revenue | (236) | 700 | (635) | 1,385 | ||
| Decrease (increase) in accounts payable and accrued liabilities | 572 | 3,748 | (6,826) | 7,686 | ||
| Total adjustments | 14,944 | 11,548 | 17,132 | 11,772 | ||
| Net cash provided by operating activities | 3,434 | 3,341 | (2,865) | 1,750 | ||
| Cash flows used by investing activities: | ||||||
| Proceeds from Carpathia receivable | -- | -- | -- | 2,500 | ||
| Purchases of property and equipment | (304) | (2,638) | (1,790) | (11,612) | ||
| Purchase of exhibition licenses | -- | 22 | -- | (1,886) | ||
| Acquisition, net of cash received | -- | -- | -- | (2,101) | ||
| Net increase in marketable securities | 2,023 | (4) | -- | (222) | ||
| Purchase of certificates of deposit | (2,031) | -- | (2,031) | -- | ||
| Proceeds from disposal of assets | -- | 400 | -- | 400 | ||
| Note receivable | -- | (625) | -- | (625) | ||
| Net cash used by investing activities | (312) | (2,845) | (3,821) | (13,546) | ||
| Cash flows from financing activities: | ||||||
| Proceeds from convertible notes | -- | -- | 12,000 | -- | ||
| Proceeds from revolving line of credit | -- | 5,864 | -- | 9,833 | ||
| Payments on revolving line of credit | -- | (6,291) | -- | (9,833) | ||
| Excess tax benefit on the exercise of employee stock options | 61 | (110) | 61 | (140) | ||
| Proceeds from option and warrant exercises | -- | 27 | 261 | 256 | ||
| Net cash provided from financing activities | 61 | (510) | 12,322 | 116 | ||
| Effects of exchange rate changes on cash and cash equivalents | (4) | (10) | 18 | (61) | ||
| Net increase (decrease) in cash and cash equivalents | 3,178 | (24) | 5,654 | (11,741) | ||
| Cash and cash equivalents at beginning of period | 7,161 | 4,709 | 4,685 | 16,426 | ||
| Cash and cash equivalents at end of period | $ 10,339 | $ 4,685 | $ 10,339 | $ 4,685 | ||
| Supplemental disclosure of cash flow information: | ||||||
| Cash paid during the period for interest | $ 49 | $ -- | $ 49 | $ -- | ||
| Cash paid during the period for taxes | $ 138 | $ 1,529 | $ 138 | $ 1,529 | ||
| Supplement disclosure of non-cash operating activities: | ||||||
| Non-cash withholding taxes receivable | $ -- | $ 2,189 | $ -- | $ 2,189 | ||
| Non-cash withholding taxes payable | $ -- | $ (2,189) | $ -- | $ (2,189) | ||
| Uncertain tax provision | $ 1,214 | $ 1,166 | $ 1,214 | $ 1,166 | ||
| Supplemental disclosure of non-cash investing and financing activities: | ||||||
| Cashless exercise of stock options | $ -- | $ -- | $ 14 | $ -- | ||
| Note receivable | $ (0) | $ (625) | $ (0) | $ (625) | ||
| Conversion of convertible notes to common stock | $ 12,000 | $ -- | $ 12,000 | $ -- | ||
| Table 4 | |||
| Adjusted EBITDA | |||
| (In thousands) | |||
| Three Months Ended | |||
| February 28, | February 28, | November 30, | |
| 2010 | 2009 | 2009 | |
| 4Q10 | 4Q09 | 3Q10 | |
| Net loss | $ (11,510) | $ (8,207) | $ (2,170) |
| (Benefit) provision from income taxes | 3,106 | (2,956) | (1,305) |
| Other expenses | (5) | 117 | 46 |
| Gain on disposal | (34) | 941 | (21) |
| Impairment of intangibles and goodwill | -- | 2,849 | -- |
| Lease abandonment | 4,351 | -- | -- |
| Depreciation & Amortization | 1,655 | 1,250 | 1,412 |
| Litigation Expense | 222 | -- | -- |
| Stock Compensation | (18) | 1,826 | 157 |
| Adjusted EBITDA(1) | $ (2,232) | $ (4,180) | $ (1,881) |
(1) Non – GAAP Measure:
Adjusted EBITDA is defined as earnings before certain unusual and/or non-cash charges, depreciation and amortization, loss (gain) on sale of operating assets, impairment of intangible assets and goodwill, and non-cash compensation expense. Adjusted EBITDA should be considered in addition to, and not as a substitute for, operating income (loss), net income (loss), and other measures of financial performance reported in accordance with GAAP.
| Table 5 | ||
| Summary of General & Administrative expense | ||
| (In thousands) | ||
| Three Months Ended | ||
| February 28, 2010 | February 28, 2009 | |
| 4Q10 | 4Q09 | |
| Compensation, excluding stock based compensation | $ 2,135 | $ 2,347 |
| Stock-based compensation | (18) | 1,826 |
| Bad Debt Expense | 269 | 363 |
| Legal and other professional fees | 1,142 | 1,957 |
| Rent and other office expenses | 408 | 352 |
| Other | 1,245 | 1,918 |
| General & Administrative expense | $ 5,181 | $ 8,763 |
| Table 6 | ||||||
| Exhibition Revenues & Operating Statistics | ||||||
| (In thousands) | ||||||
| Three Months Ended | ||||||
| February 28, | November 30, | February 28, | November 30, | February 29, | November 30, | |
| 2010 | 2009 | 2009 | 2008 | 2008 | 2007 | |
| 4Q10 | 3Q10 | 4Q09 | 3Q09 | 4Q08 | 3Q08 | |
| Admissions revenue | $ 8,300 | $ 6,933 | $ 8,668 | $ 5,977 | $ 14,891 | $ 8,998 |
| Non-refundable license fees for future exhibitions | -- | -- | -- | 4,590 | 500 | 6,183 |
| Non-refundable license fees for current exhibitions | 1,182 | 1,016 | 881 | 718 | 1,033 | 1,130 |
| Total exhibition revenues | $ 9,482 | $ 7,949 | $ 9,549 | $ 11,285 | $ 16,424 | $ 16,311 |
| Total operating days | 1,412 | 1,361 | 1,565 | 1,641 | 1,582 | 1,254 |
| Total attendance (in 000's) | 833 | 820 | 1,184 | 967 | 1,334 | 1,388 |
| Average attendance per day | 590 | 602 | 757 | 589 | 843 | 1,106 |
During the first quarter of fiscal 2010, the Company entered into an amendment to an existing multiple element agreement with promoters that modified certain of the terms and conditions of the agreement. Although these modifications had no impact on revenue recognized in this fiscal year or prior periods, the amendments modify our analysis and computation of the fair value of the undelivered elements in such a way that we will no longer be able to support the fair value of the undelivered elements in a multiple element arrangement as required by U.S. GAAP. As a result, during fiscal 2010 and in the future the Company will no longer recognize payment of non-refundable exhibition license revenue upon execution of an agreement or upon cash collection as a separate deliverable, but rather will defer such amounts until the time that the exhibition occurs, or the allowed time period for such an exhibition has passed and no remaining obligation to host such exhibition exists. This first quarter change had no impact on revenue recognized in prior periods, including non-refundable exhibition license revenue that was recognized.