Premier Exhibitions Inc. (PRXI, Financial) filed Quarterly Report for the period ended 2009-08-31.
Premier Exhibitions Inc. is a major provider of museum quality touring exhibitions throughout the world. It is Premier Exhibitions Inc. the parent company of RMS Titanic Inc. has developed two new touring exhibitions called Bodies...The Exhibition and Bodies Revealed. Premier Exhibitions Inc. has a market cap of $32.92 million; its shares were traded at around $1.47 with and P/S ratio of 0.61.
Operating expenses. Our general and administrative expenses of $7.5 million increased by $2.7 million or 58% during the quarter ended August 31, 2009 as compared to the quarter ended August 31, 2008. Our compensation expense decreased by $2.7 million this quarter compared to the same quarter last year primarily due to the resignation of certain senior management, officers and directors; however, this decrease is offset by stock compensation expense this quarter of $0.1 million compared to a reduction in stock compensation for the same quarter last year of $2.6 million due to the resignation of those same senior management, officers and directors. We recorded $0.4 million in exhibition licensing fees for those exhibitions not being displayed during the quarter ended August 31, 2009, and bad debt expense, consulting expense and legal fees increased this quarter compared to the same quarter last year by $1.4 million, $0.5 million and $0.6 million, respectively.
Our exhibition costs decreased by $3.9 million or 28% to $9.9 million for our six months this year as compared to the same six months in fiscal year 2009. Our exhibition costs as a percentage of exhibition revenue was 44% for the six months ending August 31, 2009 compared to 53% for the same period last year. Exhibition licensing fees decreased by $1.9 million or 42% to $2.6 million. Marketing expense decreased by $2.2 million or 68% to $1.0 million during our six months ended August 31, 2009 as compared to our six months ended August 31, 2008.
Gross profit. During the six months ended August 31, 2009, our gross profit decreased by $1.0 million or 7% to $14.0 million as compared to the six months ended August 31, 2008. Exhibition gross profit increased by $0.2 million on $3.6 million less revenues for the six months ended August 31, 2009 compared to the same period last year. Gross profit for merchandise decreased by $1.3 million to $1.6 million for the six months ended August 31, 2009 compared to the same period last year primarily due to the disposition of the live music aspect of our merchandising business.
Operating expenses. Our general and administrative expenses of $14.8 million increased by $2.0 million or approximately 16% during the six months ended August 31, 2009 as compared to the six months ended August 31, 2008. Compensation, including stock based compensation, decreased by $2.7 million for the six months ended August 31, 2009 compared to the same six months last year; however, we recorded $1.0 million in exhibition licensing fees for those exhibitions not being displayed, and legal fees, consulting fees and bad debt expense increased by $2.1 million, $1.0 million and $1.5 million, respectively.
On May 6, 2009, we entered into a convertible note purchase agreement with Sellers Capital Master Fund, Ltd. (Sellers Capital), pursuant to which we sold our unsecured convertible promissory notes (the Notes) in the aggregate principal amount of $12.0 million. Sellers Capital acquired Notes in the principal amount of $11.55 million and SAF Capital Fund LLC acquired Notes in the principal amount of $0.45 million. The Notes bore interest at an initial rate of 6.0% per annum, payable monthly in cash, and would have become due in three years from the issue date, if not prepaid by us or converted prior to such date. The Notes were convertible into shares of our common stock at a conversion price of $0.75 per share, a premium of approximately 7.1% to the closing price of our common stock on the NASDAQ Global Market immediately preceding the execution of the convertible note purchase agreement. On September 30, 2009 and October 1, 2009, we exercised our right to convert the Notes into common stock because the closing price of our common stock exceeded $1.00 for a period of five successive trading days as reported on the NASDAQ Global Market. A total of 16,328,878 shares of our common stock will be issued in accordance with this conversion, which includes the outstanding Notes principal and accrued interest at a conversion price of $0.75 per share.
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Premier Exhibitions Inc. is a major provider of museum quality touring exhibitions throughout the world. It is Premier Exhibitions Inc. the parent company of RMS Titanic Inc. has developed two new touring exhibitions called Bodies...The Exhibition and Bodies Revealed. Premier Exhibitions Inc. has a market cap of $32.92 million; its shares were traded at around $1.47 with and P/S ratio of 0.61.
Highlight of Business Operations:
Our exhibition costs decreased by $2.4 million to $5.1 million for our second quarter this year as compared to the same quarter in fiscal year 2009. Our exhibition costs as a percentage of exhibition revenue was 40% for the three months ending August 31, 2009 compared to 59% for the same period last year. During the second quarter of this year, cost of opening exhibitions decreased by $1.0 million because we opened six exhibitions compared to 12 exhibitions in the second quarter last year. Additionally, our marketing and exhibition licensing costs declined by $0.9 million and $1.3 million, respectively, due to managements assessment that the amount of human anatomical displays it has to exhibit is greater than the addressable market resulting in reducing the number of human anatomical displays. These reductions in costs were offset by higher rent, primarily in Las Vegas, of $0.9 million.Operating expenses. Our general and administrative expenses of $7.5 million increased by $2.7 million or 58% during the quarter ended August 31, 2009 as compared to the quarter ended August 31, 2008. Our compensation expense decreased by $2.7 million this quarter compared to the same quarter last year primarily due to the resignation of certain senior management, officers and directors; however, this decrease is offset by stock compensation expense this quarter of $0.1 million compared to a reduction in stock compensation for the same quarter last year of $2.6 million due to the resignation of those same senior management, officers and directors. We recorded $0.4 million in exhibition licensing fees for those exhibitions not being displayed during the quarter ended August 31, 2009, and bad debt expense, consulting expense and legal fees increased this quarter compared to the same quarter last year by $1.4 million, $0.5 million and $0.6 million, respectively.
Our exhibition costs decreased by $3.9 million or 28% to $9.9 million for our six months this year as compared to the same six months in fiscal year 2009. Our exhibition costs as a percentage of exhibition revenue was 44% for the six months ending August 31, 2009 compared to 53% for the same period last year. Exhibition licensing fees decreased by $1.9 million or 42% to $2.6 million. Marketing expense decreased by $2.2 million or 68% to $1.0 million during our six months ended August 31, 2009 as compared to our six months ended August 31, 2008.
Gross profit. During the six months ended August 31, 2009, our gross profit decreased by $1.0 million or 7% to $14.0 million as compared to the six months ended August 31, 2008. Exhibition gross profit increased by $0.2 million on $3.6 million less revenues for the six months ended August 31, 2009 compared to the same period last year. Gross profit for merchandise decreased by $1.3 million to $1.6 million for the six months ended August 31, 2009 compared to the same period last year primarily due to the disposition of the live music aspect of our merchandising business.
Operating expenses. Our general and administrative expenses of $14.8 million increased by $2.0 million or approximately 16% during the six months ended August 31, 2009 as compared to the six months ended August 31, 2008. Compensation, including stock based compensation, decreased by $2.7 million for the six months ended August 31, 2009 compared to the same six months last year; however, we recorded $1.0 million in exhibition licensing fees for those exhibitions not being displayed, and legal fees, consulting fees and bad debt expense increased by $2.1 million, $1.0 million and $1.5 million, respectively.
On May 6, 2009, we entered into a convertible note purchase agreement with Sellers Capital Master Fund, Ltd. (Sellers Capital), pursuant to which we sold our unsecured convertible promissory notes (the Notes) in the aggregate principal amount of $12.0 million. Sellers Capital acquired Notes in the principal amount of $11.55 million and SAF Capital Fund LLC acquired Notes in the principal amount of $0.45 million. The Notes bore interest at an initial rate of 6.0% per annum, payable monthly in cash, and would have become due in three years from the issue date, if not prepaid by us or converted prior to such date. The Notes were convertible into shares of our common stock at a conversion price of $0.75 per share, a premium of approximately 7.1% to the closing price of our common stock on the NASDAQ Global Market immediately preceding the execution of the convertible note purchase agreement. On September 30, 2009 and October 1, 2009, we exercised our right to convert the Notes into common stock because the closing price of our common stock exceeded $1.00 for a period of five successive trading days as reported on the NASDAQ Global Market. A total of 16,328,878 shares of our common stock will be issued in accordance with this conversion, which includes the outstanding Notes principal and accrued interest at a conversion price of $0.75 per share.
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