Compton Petroleum Corporation (CMZ)
F4Q10 (Qtr End 02/28/10) Earnings Call Transcript
May 13, 2010 9:00 am ET
Chris Davino – President and CEO
John Stone – CFO
Brian Wainger – General Counsel
Norman Klein [ph]
Neilla Swann [ph]
Brian Novelline – DRW Investments
Niraj Gupta – GCI Partners
Richard Alton [ph] – Brightridge Capital [ph]
Stephanie Haggerty – Register Financial
Premier Exhibitions, Inc. F2Q10 (Qtr End 08/31/09) Earnings Call Transcript
» Premier Exhibitions Inc F3Q09 (Qtr End 30/11/2008) Earnings Call Transcript
» CA Q4 2010 Earnings Call Transcript
Good day and welcome to the Premier Exhibitions, Inc. fourth quarter and fiscal year 2010 earnings results conference call. Just a reminder that today’s conference is being recorded. And now for opening remarks and introductions, I would like to turn the conference over to Mr. Chris Davino, President and CEO. Please go ahead, sir.
Good morning everyone. I'm going to first turn the call over to John, who will describe the financial results and then I will make a few Brief comments, and then we will turn it over to Q&A. John.
Thank you, Chris, and hello everyone. Thank you for joining us today. Before we review the financial results for the fourth quarter, I need to remind everyone that we’ll be making forward-looking statements on today’s call. These forward-looking statements are based on our current expectations and are subject to a number of uncertainties and risks. Actual results may differ materially. Please refer to the risk factors identified in our Form 10-K for the period ended February 28, 2009, and our subsequent filings with the Securities and Exchange Commission.
Moving on to results fiscal 2010 was a period of continued transition, a time when we stabilized the business, worked to put legacy issues behind us, and moved to reposition the company for growth. We are pleased with the progress in all these fronts, our results for the fourth quarter saw our GAAP net loss increase year-over-year, although the GAAP loss per diluted share narrowed.
Our adjusted EBITDA improved by $2 million and our cash provided by operations increased 13% year-over-year. The GAAP net loss in particular was disappointing, but it is important to note that the year-to-date decline was primarily the function of one-time non-cash expenses hitting our income statement.
In a broader sense, our financial condition is more stable than a year ago and key financial metrics are moving in the right direction. Therefore, we have turned our focus back to growing the business. For us to succeed, the company must have a stronger foundation. A strong foundation requires us to invest in the exhibition business in fiscal 2011 and beyond. These investments will require between $5 million and $7 million in fiscal 2011. Without these investments, our existing exhibitions will continue to lack the interactive and experimental elements we believe are necessary to drive future attendance and enhance customer satisfaction.
So cash currently on the balance sheet and estimated positive cash flow generated in fiscal 2011 would be directed towards these uses, which will reduce expected profitability in fiscal 2011, but we believe we will markedly improve our earnings power, and position the company to expand its presence in the exhibition business, and ultimately grab more market share.
Now turning back to the fourth quarter, exhibition revenue was $9.5 million down 1% on a year-over-year basis. We see this as a positive outcome given that we have three fewer bodies exhibition to tour in the fourth quarter of fiscal 2010 as compared to the fourth quarter of 2009; as well we had fewer Star Trek and Dialog in the Dark shows.
As you may recall, revenues can fluctuate based on variables such as the type of shows exhibited, whether the exhibition is promoted by a partner or museum as opposed to self run exhibition, and the creativity and frankly confidence of those third parties when we do elect to join forces.
To fully understand the underlying dynamics of revenue, we need to review the operating statistics. First let us begin with operating days. This is the number of days we were open to the general public for all of our shows during the fourth quarter. The theoretical maximum during the fourth quarter was 1890 days, which is calculated by multiplying the 21 possible shows on tour by the 90 calendar days of the period. This theoretical maximum does not account for the time it takes to tear down a show, pack it up, and moved it the next location and reopen.
Given these considerations, we would be very pleased if our exhibitions were open or utilized for 20%, 80% and 85% of the time. By dividing the actual operating days in the fourth quarter of 1412, by the theoretical maximum of 1890 we derive a 74% utilization rate, which compares favorably to the 63% utilization rate the company experienced in the fourth quarter of 2009. We are pleased with 11 point gain here, and we believe that there is still room to improve.
To truly understand how attendance drives the business let us look at average daily attendance. That is the average number of attendees per operating there, as reflected on table 6 in yesterday's release. Turning to the fourth quarter of fiscal 2010, average daily attendance dropped by 173 people per show compared to the year ago period. To illustrate the impact of this decline in average daily attendance, if 173 people had come through our doors over the 1412 operating days in this quarter, we would have realized approximately $3.7 million in incremental box office revenue, assuming an average ticket price of around $15.
Given that our operating costs are largely fixed, most of the additional revenue would have fallen directly to the bottom line, which is why improving attendance through investment in the properties is such a critical part of our focus in the upcoming year. We attribute the decline in average daily attendance due to exhibitions that lack appeal in today's multimedia world, and the lack of top tier markets in which we were able to operate in the fourth quarter.