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Premier Exhibitions Inc. (PRXI)

F4Q12 Earnings Call

May 23, 2012 05:30 pm ET


Sam Weiser - Interim President & CEO

Michael Little - CFO & COO


Daniel Earle – TD Securities



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Good morning and welcome to the Premier Exhibitions’ Fiscal 2012 fourth quarter earnings results conference call. Today’s conference is being recorded. I would like to remind everyone that the company will be making forward-looking statements on today’s call. These forward-looking statements are based on current expectations and are subject to a number of risks and uncertainties and are not guarantees of future performance. Undue reliance should not be placed upon them as actual results may differ materially. Please refer to the risk factors identified in the company’s filings with the Securities and Exchange Commission for a more detailed discussion of the risks that may have a direct bearing on the company’s operating results, performance, and financial conditions.

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And now, I’d like to turn the call over to Mr. Sam Weiser, Interim Chief Executive Officer and President of Premier Exhibitions Inc. Please go ahead, sir.

Sam Weiser

Thank you, Operator and good afternoon everyone. As the operator stated, we remind everyone that today’s conference call may contain forward-looking statements which are based on our current expectations and are subject to risk and uncertainty. In addition, today we will discuss adjusted EBITDA, a non-GAAP financial measure which our company uses as a key metric for evaluating performance internally and which we believe provides investors additional information to facilitate the comparison of past and present performance. A detailed explanation of this non-GAAP measure can be found in our earnings release and Form 8-K filed today with the SEC. I want to begin with a discussion of our business including our fiscal fourth quarter and full-year results.

Then I will comment on the sale of the Titanic assets before turning the call over to Michael Little our Chief Financial Officer and Chief Operating Officer. Overall I am pleased with the progress we've made in streamlining our exhibition business to position the company for profitable ongoing operations following the sale of the Titanic assets. This past year was difficult as we reorganized and restructured to realign our headcount to focus more on revenue generation and put the company in position to maximize opportunities available with our legacy properties. I am also pleased with how our professionals have executed on various Titanic initiatives to expand our revenue opportunities and take advantage of the publicity, the 100


anniversary of the Titanic sailing and sinking has generated.

Our calendar for Titanic exhibitions is full for the foreseeable future and the exhibition will visit Dallas, Fort Worth, Kansas City, Detroit, San Diego, Houston, Bangkok, Thailand and a number of other cities during the current fiscal year, all of which will complement our permanent installations in Las Vegas, in Orlando. In Orlando we are just beginning to exploit the opportunities inherent in this prime tourist destination market with our current attendance trends generating revenue that exceeds what the exhibit was generating prior to our acquisition.

In January we installed 100 artifacts from our collection to enrich the experience for the millions of potential visitors who vacation in the Greater Orlando area on a yearly basis. And these enhancements have strengthened our retail opportunities by creating another outlet for our Titanic related merchandise. We continue to operate our Titanic exhibitions while we pursue a sale of the Titanic assets. While we hope to retain exhibition rights to the Titanic for some period of time following the sale, we can't be certain how new ownership will decide to fulfill the requirement for public display of the artifacts. We are however continuing to book engagements to meet demand since the current and future exhibitions may represent the final opportunities for the millions of Titanic fans to experience Titanic: The Artifact Exhibition.

In addition we continue to pursue new licensing and merchandising opportunities to secure new distribution channels for our Titanic merchandise and intellectual property. Since yearend our intellectual property from Expedition 2010 has been featured in the National Geographic cover story and a History Channel documentary about the groundbreaking scientific work performed on the 2010 expedition. While we didn't recover any artifacts on the most recent expedition, we did secure some amazing intellectual property that we are now introducing into our exhibitions. Our first installation was our New Atlanta Titanic exhibition and we intend to roll out more of this new exhibitory over the next six months.

We've also been working with a group at the Michigan State University to provide groundbreaking research on the Titanic Mapping Project and you can expect to hear more about this initiative in the coming months. As you might expect our e-commerce website offering Titanic theme merchandise has been showing strong results. Coupled with other merchandise related initiatives we have enjoyed an increase in merchandise revenue around the anniversary and sales continue to be strong. We have also seen a significant increase in our exhibition merchandise sales as our per cap sales increased 30% year over year in the fourth quarter.

Per cap sales refers to the amount of merchandise sold on average to everyone who attends the exhibitions. Moving forward our recent acquisition of the Arts & Exhibitions International assets has not only diversified our exhibition portfolio, but also added experienced professional talent and provided access to new content. The combination of the Premier and AEI businesses has positioned the company as an industry leader in the development and exhibition of unique content for education, entertainment and brand extension. Our focus is to establish Premier and its AEI subsidiary as the leading source for content owners to expand their brands through joint ventures and other licensing arrangements that provide the appropriate risk reward profile to generate profitable revenue growth.

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