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Premier Exhibitions Inc. (PRXI)
Q3 2012 Earnings Call
January 12, 2012 9:00 am ET
Samuel Weiser – Chief Executive Officer (interim), President
Michael Little – Chief Financial Officer, Chief Operating Officer
Brian Wainger - Counsel
Tony Basonich (sp) – BGI Capital
Previous Statements by PRXI
» Premier Exhibitions CEO Discusses F2Q 2012 Results - Earnings Call Transcript
» Premier Exhibitions CEO Discusses F1Q 2012 Results - Earnings Call Transcript
» Premier Exhibitions CEO Discusses Q4 2011 Results - Earnings Call Transcript
And now, I’d like to turn the conference over to Mr. Sam Weiser, Interim Chief Executive Officer and President of Premier Exhibitions Inc. Please go ahead, sir.
Thank you, Operator. Good morning everyone. About six weeks ago as part of our strategic realignment, I assumed the role of Interim Chief Executive Officer and President, managing Premier’s overall business operations while Michael Little, our Chief Financial Officer, also added to his plate the responsibility of serving as our Chief Operating Officer. Chris Davino is now President of RMS Titanic and focusing his efforts exclusively on strategic transactions involving this content subsidiary and the Titanic artifacts collection.
This new organizational hierarchy is an outgrowth of separating our operations into two divisions: a content subsidiary in RMST and an exhibition management subsidiary in Premier Exhibition Management. In other words, each unit is now acting independently of the other and pursuing the best business opportunities available to it.
With that in mind, I would like to begin today’s discussion with our recent announcement regarding the planned auction of our Titanic artifact collection and related intellectual property and then provide a general update on the overall state of the business.
Those of you who have followed us for some time are certainly aware that we have spent countless hours, dollars and resources to ensure that Titanic is well preserved for future generations, and it is for this reason that we were granted stewardship of the complete collection of more than 5,000 artifacts that had been recovered from the wreck site 2.5 miles below the ocean surface. We are therefore pleased to be working with Guernsey’s auction house to identify worthy stewards of the Titanic artifact collection and are confident that we are going to do so in a manner consistent with our role as steward of the collection and wreck site. We are fully committed to complying with the covenants and conditions imposed by the court and are seeking potential buyers we believe the court will view as acceptable new stewards of the collection and wreck site.
So why have we decided to auction these Titanic artifacts at this time? Because a successful auction process affords us the unique opportunity to preserve the artifacts within the public domain while at the same time meeting our obligations to you, our shareholders, to realize the value of these unique, one-of-a-kind assets. However, in achieving this objective, it is essential that we put these artifacts in capable hands that can care for them in perpetuity without the pressures of asset monetization and continued shareholder expectations.
Back in 2007, the artifact catalogue coupled with the work product, intellectual property, and certain undertakings of the Company including the cost of salvage, lab operations, and exhibition rights were appraised at approximately $189 million; however, this appraised value has not been updated since that time and does not include the intellectual property acquired from the 2010 expedition. In addition, this appraisal does not ascribe any value to our rights as salvor and steward of the wreck site or consider the court’s covenants and conditions.
We expect to identify a buyer capable of serving as a proper steward of the collection and wreck site while continuing to build upon the work that RMST and its partners in the oceanographic and archeological communities have achieved in documenting and preserving the wreck site. Given these relationships with the oceanographic community, the artifacts and our archives of data relating to the recovery, restoration and maintenance of the collection, we are delivering to a potential buyer a real brand around this property that is beloved worldwide.
We intend to announce the auction result on or around April 11, 2012 in New York City. Participants in the auction must be pre-cleared by Guernsey’s and the Company and are required to comply with all covenants and conditions set by the court. In accordance with our longstanding commitment to protect and preserve the Titanic, assuming a suitable buyer is identified, we will direct a portion of the proceeds generated by the sale to the Titanic Preservation Trust, and endowment fund created by the Company for future conservation and maintenance of the artifacts removed from the wreck site.
While we pursue the auction, we continue to pursue various initiatives we have undertaken for Titanic to expand the revenue opportunities and build the brand, taking advantage of the publicity the 100th anniversary will generate. In addition, demand for Titanic exhibitions is accelerating as we approach the anniversary, and pursuit of a new steward for the collection will not impact the way we operate our exhibitions.