Hot Stock under Review: Collectors Universe Inc. (NASDAQ: CLCT)

Collectors Universe, Inc. (CLCT), a leading provider of value-added authentication and grading services to dealers and collectors of high-value collectibles, recently declared financial results for its fourth quarter and year ended June 30, 2018.

Operational and Financial Highlights:

  • Revenues in the fourth quarter of fiscal 2018 were $17.10M, down 5% from the record fourth quarter revenues of $18.00M in fiscal 2017.  For fiscal year 2018, revenues were $68.40M, down 2% from the record $70.20M in fiscal year 2017.
  • Our cards and autograph service revenues increased by $0.90M, in the fourth quarter and by $3.10M, in fiscal 2018 which represented increases of 18% in both periods and record quarterly and annual revenues for that business.
  • Our total coin revenues reduced by $1.70M, or 15%, in the fourth quarter and by $4.70M, or 10%, in fiscal 2018.  The lower coin revenues in the fourth quarter, mainly reflected a decrease in modern coin revenues in the United States and China. The lower coin revenues in fiscal 2018 mainly reflected a $6.40M or 17% decrease in U.S. coin revenues because of the formerly revealed general slowness in the domestic coin market, partially offset by a $1.70M or 18% increase in total overseas coin revenues (which included a boost of $1.10M or 16% in China).
  • Operating income was $2.20M and $9.00M in the fourth quarter and fiscal 2018, as contrast to $1.20M and $13.20M, in the same periods of 2017.  Non-cash stock-based compensation expense was $0.50M and $1.40M in the fourth quarter and fiscal 2018, as contrast to $3.70M and $4.00M in the same periods of fiscal 2017. The lower operating income in the current year periods, when adjusted for non-cash stock-based compensation, mainly reflects the decreases in U.S. coin revenues as discussed above. In addition, we incurred $0.60M in moving and lease exit costs for the relocation of our operations and headquarters to a new facility, in fiscal 2018.
  • The resulting income from continuing operations was $1.00M, or $0.11 per diluted share, and $6.10M, or $0.70 per diluted share, in the fourth quarter and fiscal 2018 as contrast to $1.00M, or $0.12 per diluted share, and $8.50M, or $0.99 per diluted share, in the same periods of fiscal 2017.  The provisions for income taxes in the current year periods, reflect federal income taxes at a blended rate of 28% arising from the Tax Cuts and Jobs Act that was enacted into law in December 2017. In the fourth quarter of fiscal 2018, we incurred overseas withholding taxes and finalized the write down of our deferred tax assets to our go forward federal tax rate of 21%.
  • The Company’s cash position as of June 30, 2018 was $10.60M, as contrast to $9.80M at June 30, 2017 and $9.20M at March 31, 2018.  Net cash generated of $0.80M in fiscal 2018 included $11.90M of cash generated from continuing operations and $3.00M of borrowings under our term loan, partially offset by $9.10M used to pay cash dividends to stockholders, $4.80M used for capital expenditures and capitalized software costs (which are inclusive of expenditures for our new operations and headquarter facility), and $0.20M used for suspended operations.

The Company offered net profit margin of 7.20% while its gross profit margin was 55.90%. ROE was recorded as 32.60% while beta factor was 0.82. The stock, as of recent close, has shown the weekly downbeat performance of -1.93% which was maintained at -50.21% in this year.

Penny Cook

Penny Cook is passionate about business and finance news with over 5 years in the industry starting as a writer working her way up into senior positions. She is the driving force behind www.nasdaqjournal.com with a vision to broaden the company’s readership throughout 2016. Cook is an editor and reporter of “Services” Category.

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