PCGS Warranty Loss Questions
OregonCityGold
Posts: 427
Noticed this in footnote 1 on p. 45 of the Collectors Universe September 30, 2008 10-K SEC disclosure... Link
"A $3,254,000 decrease in operating income generated by our coin grading business in fiscal 2008, as compared to fiscal 2007, which was due primarily to a decline in trade show revenues of approximately $1,500,000 in fiscal 2008, and higher costs of sales, which included warranty costs of $822,000 recognized in the second quarter of fiscal 2008 as a result of certain significant coin warranty claims."
Anyone know what those "signifcant warranty claims" might have been? Any chance such warranty claims are the reason for tighter grading standards lately? If the warranty is one of the main reasons for CLCT losing money, and if it causes a gun-shy PCGS to undergrade coins, and if it forces PCGS to charge more for grading, does the warranty really help dealers and collectors?
"A $3,254,000 decrease in operating income generated by our coin grading business in fiscal 2008, as compared to fiscal 2007, which was due primarily to a decline in trade show revenues of approximately $1,500,000 in fiscal 2008, and higher costs of sales, which included warranty costs of $822,000 recognized in the second quarter of fiscal 2008 as a result of certain significant coin warranty claims."
Anyone know what those "signifcant warranty claims" might have been? Any chance such warranty claims are the reason for tighter grading standards lately? If the warranty is one of the main reasons for CLCT losing money, and if it causes a gun-shy PCGS to undergrade coins, and if it forces PCGS to charge more for grading, does the warranty really help dealers and collectors?
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<< <i>Noticed this in footnote 1 on p. 45 of the Collectors Universe September 30, 2008 10-K SEC disclosure... Link
"A $3,254,000 decrease in operating income generated by our coin grading business in fiscal 2008, as compared to fiscal 2007, which was due primarily to a decline in trade show revenues of approximately $1,500,000 in fiscal 2008, and higher costs of sales, which included warranty costs of $822,000 recognized in the second quarter of fiscal 2008 as a result of certain significant coin warranty claims."
Anyone know what those "signifcant warranty claims" might have been? Any chance such warranty claims are the reason for tighter grading standards lately? If the warranty is one of the main reasons for CLCT losing money, and if it causes a gun-shy PCGS to undergrade coins, and if it forces PCGS to charge more for grading, does the warranty really help dealers and collectors? >>
Of course the warranty helps. In the short term it might hurt now and again, but in the long term it has to help. Without the warranty, the PCGS opinion value slips significantly, as does the potential value of holdered coins. As to what coins were sent in for review, the insiders might know, so I hope one of them posts.
PCGS just laid off 15, including graders. Their stock price is down almost 80% from the 52 week high. I would think that a lot of the warranty stuff was the whole bullion grading fiasco in which it was promoted as a good idea, and then the milk spots reared their ugly heads.
...........yeah! whatever happened to the milkspot mystery? wasn't there some people working on solutions/fixes/rewards for solutions to the problem?
<< <i>...........yeah! whatever happened to the milkspot mystery? wasn't there some people working on solutions/fixes/rewards for solutions to the problem?
Believe me, there's been no solution or we'd know about it on here
That's not to say there aren't a few among us probably experimenting in our basements for a solution! (Not me though).
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