PSA is still facing a backlog of over one million trading cards in its system as the grading and authentication firm ramps back up following a temporary closure earlier this spring.
The division’s parent company, Collectors Universe, saw revenue and income drop during the third fiscal quarter of 2020, but attributed the decline to the impact of a sudden shutdown due to governmental stay at home orders in March. After nearly three weeks, the company reopened in mid-April with what it called “limited staff” in place.
The closure didn’t help ease the often lengthy turnaround times collectors and dealers have been experiencing for nearly two years. The company says it’s been implementing procedures aimed at getting a handle on the problem.
“Some of the early efforts made during our operational revamp are helping improve efficiency, but the PSA submission backlog continues to grow to unprecedented levels,” stated Collectors Universe President and CEO Joe Orlando in the company’s quarterly earnings call.
He said prior to the shutdown, PSA had three consecutive weeks in which it took in more than 100,000 units at its Southern California facility. That’s 32,000 more than where capacity stood last fall.
“Our receiving department was the first one tackled in our lean manufacturing revamp, and we are very pleased with the improvement. Of course, due to the challenges before us, it will take time to get back to that level of production, and we do expect to experience some inefficiencies as we ramp up the operation.”
Orlando says CU implemented numerous safety protocols in the wake of COVID-19 while increasing capacity as business restrictions began to ease last month.
“This has been achieved in part by limiting the number of people at the office at any given time. We have accomplished this by spreading out the staff through additional shifts as well as keeping those employees at home who can work remotely based on their job duties. So far, this approach has gone as well as we could have expected.”
PSA’s third quarter revenue actually went up despite the shutdown while CU’s coin grading division was down.
“There was an increase of $1.2 million or 17% in cards and autographs, more than fully offset by a decrease of $1.8 million or 16% in coins,” stated Joe Wallace, Senior Vice President and Chief Financial Officer. “The cards and autographs increase represented record third quarter revenues, and that business has achieved quarter-over-quarter revenue growth in 38 of the last 39 quarters, although the growth in this year’s third quarter was curtailed by COVID-19.”
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