One of the industry’s biggest players is OK with a few red marks as they look for long-term growth.
Dreams Inc., parent company of Mounted Memories, ProSportsMemorabilia.com, FansEdge and Schwartz Sports lost $1.4 million during the first six months of this year, but saw its revenues increase 28% to a record $32.2 million over the same time period in 2007.
The company announced its six-months and quarterly financial results Thursday. For the quarter, revenues rose 30%, to a record $13.7 million, compared to $10.5 million reported in the same quarter last year. Net losses for the quarter ended June 30, 2008 were $1.1 million, versus a loss of $873,000 for the same quarter last year.
"Our manufacturing/distribution segment revenues were up 41.2%, anchored by the Orange Bowl Stadium project revenues and the addition of Schwartz Sports," said Ross Tannenbaum, president and CEO of Dreams.
“While losses increased slightly for the three and six months ended June 30, 2008, they were consistent with our internal budgets, and we remain on target to achieve our record projected financial goals of $91 million in revenues and a fourth consecutive year of increasing profitability for the twelve months ending December 31," Tannenbaum stated. "Our business is cyclical and the second calendar quarter is typically the weakest quarter in our industry. Our historical business model generates a greater portion of our annual revenues and profits in the holiday quarter (October-December)."
“This was an eventful quarter with our execution of our multi-channel retailing strategy. That is, to drive one brand via multiple channels. Specifically, we added our first FansEdge store to be cross-marketed with the incredible success this brand has enjoyed on-line." Dreams opened a brick-and-mortar Fans Edge store in May at a suburban Chicago shopping mall and generated $100,000 in sales for the initial 40 days, according to the company. Additional FansEdge store locations have been identified and are targeted to open in the greater Chicago area to leverage the start of the 2008 holiday quarter.
“In addition, we recently announced the strong response we have received with the introduction of our Syndication services," Tannenbaum said. "Dreams Retail Solutions has rapidly built a clientele representing almost every sector of the sports industry. The prime example is Majestic Athletic, the official licensee of on-field apparel for Major League Baseball, for which we created and operate the Majestic Clubhouse Store. Other beneficiaries of our services include Pro Football Weekly, the Sporting News and Beckett. We are now positioned to grow this business through the addition of numerous sports-oriented companies looking to launch an e-commerce presence on the Internet or replace an existing online fan shop with a comprehensive, scalable e-commerce platform."