Dreams Inc., parent company of Mounted Memories and other sports memorabilia properties, is preparing to expand in the wake of a revenue increase for the last quarter of 2007.
Dreams, Inc. (AMEX:DRJ) has reported an increase in revenue from the same time a year ago and the Florida based sports memorabilia giant is also planning to build up its physical presence in the world of autographed and licensed products.
Revenues for the last quarter were up 47% to a record $36.5 million, compared to the quarter ended December 31, 2006 while revenues for the nine-months were up 44% to a record $59.7 million, compared to the nine-months ended December 31, 2006. Net income for the quarter was up 14% to $2.4 million, compared to the quarter ended December 31, 2006; while net income for the nine-months was $792,000; down from $1.4 million for the nine months ended December 31, 2006.
"These were record-breaking periods for Dreams as we continue to manage our impressive growth, integrate our acquisitions and invest in future revenue producing initiatives," claimed Ross Tannenbaum, Dreams’ President & CEO.
"In analyzing our results, our core models continued to produce historical gross margins. However, due to some softening in retail, we chose to give up 2% to 3% in gross margins by offering special promotional items at our main Internet site, FansEdge.com, during the six weeks from Thanksgiving to year-end. The $20 million in Internet sales we achieved during this period helped us produce record revenues for the quarter and reduce inventory amounts to targeted levels.
"Also, with investments in technology and other depreciable assets to support our growth, we had $928,000 in depreciation and amortization expense for the nine-months ended December 31, 2007, versus $515,000 for the same period last year. Interest expense increased to $708,000 for the nine-months ended December 31, 2007, versus $390,000 for the same period last year. The interest increase is a result of carrying higher loan balances on our credit facility to support the higher inventory levels and the servicing of new notes payable from our Schwartz Sports acquisition.
"While each of these costs/expenses contributed to the reduction in the reporting period net income results, we expect these investments to provide for future benefits influencing both revenues and profits.
Tannenbaum says the company’s financial goal for 2008 is $91 million in consolidated revenues.
Dreams will open its first FansEdge brick & mortar store in the Chicago market scheduled to open this month. Dreams Inc. is also the parent company of one of the largest sellers of sports autographs online, ProSportsMemorabilia.com.
"This strategy of positioning our FansEdge brand by adding stores to the web presence will result in our becoming the first multi-channel, fan focused retailer in the industry," Tannenbaum said. Additional FansEdge store openings are planned for later this year.
The company has targeted Las Vegas–its highest volume market– for the opening of new Field of Dreams and FansEdge stores. They will also expand their 365 Live model which features athletes appearing and signing autographs in several locations.
In the second half of last year, Dreams purchased the Chicago Sun Times Show as well as Schwartz Sports, a Chicago based provider of authentic, autographed sports memorabilia. They also purchased four Florida based Field of Dreams locations in June & July 2007.
"Our record results validate our ability to successfully grow both organically and via strategic acquisitions now and into the future. This trend advances our objective of becoming the dominant player in the $14 billion per year licensed sports products industry," concluded Tannenbaum.