No Big Bang as Collectors Universe Inc. Expands

In an exception to the spectacular stock market debuts by a number of Orange County Internet firms, Santa Ana-based Collectors Universe Inc. on Friday raised $24 million in a lackluster initial public offering.

The company, which authenticates collectibles such as coins and memorabilia and auctions them off over the Internet and in person, sold 4 million shares priced at $6 each, below its previously projected range of $7 to $9 a share.

The stock moved as high as $7.75 a share during trading but settled back to close unchanged at $6 on volume of 2.4 million shares on the Nasdaq market.

Collectors Universe already faces a crowded field with established online competitors such as eBay Inc. and Yahoo Inc. as well as traditional rivals such as Sotheby’s Inc. and Christie’s Inc.

For the year ended June 30, the company had a net profit of $387,000 on revenue of $22.6 million, but in its most recent quarter, the company lost $440,000 on revenue of $8.2 million as gross margins fell and operating costs rose.

More than 78% of the company’s revenues come from providing authentication services, but during the last fiscal year half of the company’s auction revenues came from the Internet.

With 24.4 million shares outstanding, the company is currently valued at $146 million. Company founder David Hall, who is chairman of the board, owns 34% of the company. No insiders sold stock on Friday.

The company, created in February by the combination of five companies in the collectibles and auction industry, said proceeds from the offering, which was underwritten by Needham & Co., will go toward increasing its advertising and marketing programs and to acquire collectibles for resale in the company’s auctions.

The company did not return calls for comment.