Collectors Universe Acquires American Gemological Laboratories (AGL) and Enters
the Colored Gemstone Market for Third Party Authentication and Grading
NEWPORT BEACH, Calif., Aug. 21 /PRNewswire-FirstCall/ -- Collectors Universe, Inc.
(Nasdaq: CLCT), a leading provider of value-added authentication and grading services
to dealers and collectors of high-value collectibles and to sellers and purchasers
of diamonds and other high value assets, today reported that it has acquired American
Gemological Laboratories (AGL), an international forensic colored gemstone certification
and grading laboratory. AGL is one of the leading third party authentication and
grading services for colored gemstones, including colored gemstones that are sold
at auction through Sotheby's and Christies and by jewelry retailers such as Cartier
and Fred Leighton. The Company paid an aggregate acquisition price of $3.5 million
in cash for AGL, and, depending on the future financial performance of AGL, may
become obligated to make contingent payments of up to an aggregate of an additional
$3.5 million over the next five years.
AGL was founded by C.R. "Cap" Beesley, who is a Graduate Gemologist of Gemological
Institute of America and a recipient of numerous awards including the prestigious
Antonio C. Bonanno Award for Excellence in Gemology from the Accredited Gemologists
Association, given annually to the individual who has made significant contributions
to the field. Mr. Beesley, President of AGL since its founding in 1977, is joining
Collectors Universe as President of AGL, which will be operated as a wholly-owned
subsidiary of the Company. Prior to founding AGL, Mr. Beesley held positions for
more than nine years with the Gemological Institute of America where he developed
the first colored stone grading course and curriculum.
Chief Executive Officer of Collectors Universe, Michael Haynes commented, "The acquisition
of AGL represents a further step in the implementation of our strategic plan to
enter the diamond and colored gemstone authentication and grading businesses, the
two primary high value jewelry markets. We are extremely pleased to be able to execute
on this strategy by acquiring AGL, which is one of the most highly regarded companies
in the colored gemstone market. Additionally, we have been able to secure Cap Beesley's
unmatched experience and knowledge as president of AGL. With AGL joining our diamond
authentication and grading service, we are continuing our 'best of breed' philosophy
in our operations and leadership in all of our existing markets. We believe, moreover,
that with the addition of the knowledge and experience of AGL and Cap Beesley to
our existing expertise in diamond grading and authentication, we now have assembled
the intellectual capital and jewelry market recognition to further extend our expertise
into the major markets and distribution channels of the jewelry business."
The certification of colored gemstones requires not only the color and clarity examinations
required for diamond certification, but also analyses for the enhancements on and
determinations of the country of origin of the colored gemstones. Unlike diamonds,
almost all colored gemstones have received some form of enhancement and the nature
and quality of the enhancement can have a dramatic effect on the value of a colored
gemstone and, therefore, are important disclosure elements in the grading process.
Country of origin also can have a dramatic effect on the value of a colored gemstone,
with value differences of up to 300% based on the country of origin. With the acquisition
of AGL, Collectors Universe now has one of the largest colored gemstone reference
collections, with over 5,000 colored gemstones from various countries and specimens
demonstrating the various enhancements and treatments, which is critical to the
ability to accurately evaluate the nature and quality of colored gemstone enhancements
and to determine the country of origin.
During calendar 2004, the U.S. Gemological Survey, through the U.S. Census Bureau,
reported imports of 15.2 million carats of cut but unset emeralds, rubies and sapphires
into the United States, which compares with U.S. imports in 2004 of 18.4 million
carats of cut but unset diamonds. Other precious and semi-precious colored gemstones
imported into the U.S. include amethysts, aquamarines, garnets, iolites, opals,
peridots, spinels, tanzanites, topaz, and tourmalines.
Cap Beesley remarked, "I am very excited to join Collectors Universe and to have
AGL become a Collectors Universe company. Throughout my career, I have always been
an advocate of improved consumer information and disclosure and have had success
influencing the markets with our third party certification. Now with the substantial
resources, both financial and technological, and the reputation for integrity of
Collectors Universe, I am confident that together we will bring the benefits of
third party certification to many more thousands of retail transactions each year.
I also am confident that the entire jewelry market will benefit from the application
of the high operational standards and systems of internal controls that have been
implemented and are employed by Collectors Universe through all of its divisions."
About Collectors Universe
Collectors Universe, Inc. is a leading provider of value added services to the high-value
collectibles and diamond markets. The Company authenticates and grades collectible
coins, sports cards, autographs, stamps, currency and diamonds and, with its acquisition
of AGL, now also authenticates and grades colored gemstones. The Company also compiles
and publishes authoritative information about United States and world coins, collectible
sports cards and sports memorabilia, collectible stamps and diamonds. This information
is accessible to collectors and dealers at the Company's web site, www.collectors.com,
and is also published in print.
Cautionary Statements Regarding Forward Looking Information
This news release contains statements regarding our expectations, beliefs and views
about our future financial performance which are "forward-looking statements" as
defined in the Private Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by the use of words such as "believe," "expect," "anticipate,"
"intend," "plan," "estimate," "project," or future or conditional verbs such as
"will," "would," "should," "could," or "may."
Due to a number of risks and uncertainties to which our business is subject, our
actual financial performance in the future may differ, possibly significantly, from
our expected financial performance as set forth in the forward looking statements
contained in this news release. Information regarding those risks and uncertainties,
and their possible impact on our future financial performance, including, but not
limited to the risks that our strategy to expand into new collectibles and other
high value asset markets, such as the diamond and colored gemstone markets, and
to offer new services in our existing markets will not be successful in enabling
us to improve our profitability or may even cause us to incur losses, is contained
in our Annual Report on Form 10-K for our fiscal year ended June 30, 2005 which
we filed with the Securities and Exchange Commission on September 13, 2005 and our
Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2006, which
was filed with the Securities and Exchange Commission on May 10, 2006. Due to such
risks and uncertainties, readers are cautioned not to place undue reliance on the
forward-looking statements contained in this news release, which speak only as of
its date, or to make predictions about future performance based solely on historical
financial performance. We also disclaim any obligation to update forward-looking
statements contained in this news release or in our Annual or Quarterly Reports
filed with the Securities and Exchange Commission.
SOURCE: Collectors Universe, Inc. 08/21/2006
Joe Wallace, Chief Financial Officer of Collectors Universe, +1-949-567-1245, email@example.com;
or Investor Relations, Brandi Piacente of The Piacente Group, Inc., +1-212-481-2050,
firstname.lastname@example.org, for Collectors Universe, Inc.
Web site: http://www.collectors.com
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:
Statements in this press release regarding Collectors Universe Inc's business which
are not historical facts are "forward-looking statements" that involve risks and
uncertainties. For a discussion of such risks and uncertainties, which could cause
actual results to differ from those contained in the forward-looking statements,
see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently
ended fiscal year.