Premier Exhibitions, Inc. (PRXI) F1Q13 Earnings Call July 12, 2012 9:00 am ET Executives Samuel S. Weiser – President and Chief Executive Officer Michael Little – Chief Financial Officer and Chief Operating Officer Analysts William Vlahos – Odyssey Value Advisors LLC Presentation Operator
I would like to begin with a discussion of our business and afterwards, I will turn the call over to Michael Little, our Chief Financial Officer and Chief Operating Officer to review our financial performance in greater detail. In our view, fiscal 2013 should be an exciting year for our business. First, we look forward to completing the sale of the Titanic assets. Second, we are beginning to realize the benefits of prior year cost saving and management initiatives. Lastly, we are building our operating business both organically and through acquisitions to position the company for sustainable profitability quarter-to-quarter.Our first quarter results indicate that we are off to a pretty good start in building a platform for sustainable top line growth and profitable ongoing operations. As the first quarter results suggest, we made progress along several different fronts including increasing revenue, expanding gross profit, generating substantially more operating cash flow, and diversifying our exhibition portfolio. Our acquisition of AEI has solidified Premier as the industry leader in the development and exhibition of unique content for education, entertainment, and brand extension. The integration of AEI is progressing smoothly and a number of the new content opportunities we obtained are quickly taking shape. While many of these projects will require a time, we expect that this new content will be accretive to earnings in fiscal 2014. In the meantime, we are exploring ways to extract additional revenue from the existing properties we acquired, which coupled with the management fees we earn under our agreement with AEG will be accretive to the company in this fiscal year. The AEI acquisition immediately diversified our exhibition portfolio. Additionally, we believe the revenue potential embedded in the content of the Tut, Cleopatra, Real Pirates and America I Am brands can be more fully exploited by the combined enterprise. The AEI transaction also added experienced professionals who brought strong industry relationships and compelling new exhibition opportunities to our organization that we believe will fully demonstrate our industry leadership and help us to transform the exhibition industry.
The new fiscal year also introduced a new strategic vision for Premier. One in which we intend to extend the exhibition experience beyond the four walls of the exhibition hall. We are pursuing digital strategies that will deliver our content in varied ways to multiple constituencies of consumers. Many of these new strategic initiatives will be introduced this year, and should also be accretive to our bottom line. We are also focused on continuing to build our core business by introducing Premier and AEI to content owners, looking to expand their brands through join ventures and other licensing arrangements.Furthermore, we are open to exploring other strategic acquisition opportunities that are accretive to our business along with fee-for-service arrangements with content owners looking to develop, construct and tour exhibitions built around their content. Bookings for existing exhibitions and the newly acquired properties have been strong. Our calendar has fall and we continue to see demand for our unique content. Our business model is unique with both touring and semi-permanent installations. Our semi-permanent installations in Los Vegas, New York, Orlando and Atlanta continue to provide significant contributions to our gross margin. Our recently acquired venue in Orlando has shown increasing attendance trends and drastically improved the merchandise sales. While the 100 th anniversary didn’t hurt, our marketing in Orlando is beginning to create awareness of the venue as a destination, which should keep these attendance trends in tact . The touring segment of our business was also strong, as our Titanic shows benefited from the 100 th anniversary of Titanic’s inaugural and only voyage. As Michael explained, the results in our second quarter will better reflect the strength of the attendance at our touring exhibitions during the first quarter. Read the rest of this transcript for free on seekingalpha.com