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Company History: Greg Manning Auctions, Inc.

Key Dates:
1966: The Greg Manning Company is founded.
1981: The company opens a 76,000-square-foot facility.
1993: Greg Manning Auctions, Inc. (GMAI) goes public.
1994: Sales reach $27 million.
1998: GMAI buys Teletrade and launches an Internet presence; the company's stock price increases tenfold.
1999: GMAI announces an alliance with eBay and buys Spectrum Numismatics.
2000: GMAI's joint venture with eBay is terminated, and the company rejects a purchase offer from Take to Auction.com.
2001: GMAI re-incorporates under Delaware state laws.
2003: The company makes significant international acquisitions; sales reach $118 million. The explosion of Web users in China served the company well: within one month, said Manning, "We had 10,000 registered users." At the same time, the Chinese market posed interesting challenges. Customers were accustomed to using cash, not credit; shipping was expensive; and shoppers were unused to making purchases sight unseen. GMAI-Asia.com worked around these obstacles by establishing kiosks where customers could place an order, then return several days later to examine and retrieve their purchases. Plans were laid for an additional partnership in Spain, to be called GMAI-Europe.com. In late 1999, GMAI acquired Spectrum Numismatics International, a leading coin wholesaler, for $25 million in stock. Spectrum Numismatics sold coins to auction houses and Internet distributors. Sales for the fiscal year rose to $39.6 million.
In early 2000, GMAI discontinued its partnership with eBay in favor of online retailer Amazon.com, citing disappointment with marketing for its eBay site and vowing to take joint responsibility for aggressively marketing the new venture to Amazon's 17 million registered customers. In August, the company received an unsolicited purchase offer from Take to Auction.com, a much smaller Web auctioneer, which offered $14 a share, or $140 million, in stock. The offer was rejected as too low by the GMAI board, which expressed optimism about its own prospects for growth. In December, GMAI announced the purchase of certain assets of World's Finest Comics and Collectibles, a dealer in comic books and art as well as movie posters and Disney collectibles. The Disney memorabilia alone was valued at $1 million.
In 2001, GMAI shareholders approved a plan to re-incorporate the company in Delaware to take advantage of the state's pro-business legal climate. In 2003, GMAI announced plans for a series of international acquisitions, including majority interests in Corinphila Auktionen of Switzerland, the Kohler group of auction houses in Germany, and Spanish auction house Auctentia Subastas. GMAI also announced its first major philatelic auction in Hong Kong.
By the end of the first quarter of fiscal year 2004 (which ended in September 2003), GMAI's aggregate sales had increased to $41.3 million for the quarter, a 41 percent increase over the previous year. Revenue was up 36 percent, to $34.5 million, and net income stood at $2.5 million, a company record. GMAI's forecast for the year's aggregate sales was pegged at $165 million, up from $118 million in 2003. Board Chairman Esteban Perez noted that GMAI's recent acquisitions had already had a decisive impact on results and revealed that the company was investigating a listing on Spain's Bolsa market in addition to its NASDAQ listing. As Perez stated, "We view fiscal 2004 as a platform for the future growth of GMAI, and as we further integrate our companies we fully expect that the synergies we have already achieved can only be beneficial to our long-term growth."

Founded: 1966 as The Greg Manning Company
NAIC: 541990 All Other Professional, Scientific, and Technical Services

One of the world's most important auction houses for stamps, Greg Manning Auctions, Inc. (GMAI), is also a major auctioneer of coins, sports cards, movie posters, comic books, and other specialty collectibles. Greg Manning does business across the price spectrum but focuses on high-end specialty markets where its expertise and customer service can serve to differentiate the company from the competition. The company has a strong presence in Europe and Asia through joint ventures in Spain and China.

Greg Manning began collecting stamps at the age of seven, and as a teenager he sold stamps through the mail, earning, by his account, "thousands of dollars per year." After high school, he set out to learn the auction business, realizing that auctions held more potential for profit than the lower-volume retail business. James Rasdale, of the Rasdale Stamp Company, later remembered the young Manning as "very polite, aggressive, and mature," as well as a good judge of people. In 1966, at the age of 20, he held his first public auction. By 1971, he had opened an office, and ten years later his business had grown to the point that he opened a 76,000-square-foot facility in Montville, New Jersey, to house his auctions. At the same time, he was operating a venture called International Postal Marketing, which was cited in 1981 by Inc. magazine as the fifth-fastest-growing private company in the United States. In 1993, Manning's ventures went public as Greg Manning Auctions, Inc. (GMAI), initiating a growth spurt fueled by a rapid series of acquisitions. Purchases including Ivy, Shreve, & Mader Philatelic Auctions; Harmer Rooke Galleries; and CEE JAY Auctions. Although GMAI branched out into auctioning sports cards and other collectibles, stamps remained its focus. The company stockpiled a huge inventory and carved out a niche selling major collections in their entirety, with the quality and enormous volume of material attracting dealers from all over the world. In 1994, GMAI auctioned a collection of envelopes printed with illustrations for $330,000, which was believed to be the largest sum ever paid for an individual stamp collection sold as a whole. The company's aggregate sales for the year rose to $27 million. By 1995, GMAI had 32 employees, a new facility in West Caldwell, New Jersey, and a second office in Manhattan. Manning himself was recognized as one of the world's leading authorities on stamps.

In 1998, GMAI moved into electronic auctions by purchasing Teletrade, Inc., an auction house that sold diamonds on the Web and by touchtone telephone, for $6 million. Teletrade's technology allowed customers to bid by computer or telephone keypad; their bids registered directly on the auctioneer's computer. Suddenly perceived as an Internet company, GMAI saw its stock leap from $2 to $21 per share. Within six months, Web sales accounted for more than 50 percent of GMAI revenue. In 1999, the company launched a partnership with the online auctioneer eBay. Daily auctions of GMAI goods were held on eBay's site, which boasted 3.8 million registered bidders. Unlike eBay, which bought buyers and sellers together but otherwise stayed aloof from transactions, GMAI continued to serve as a full-service intermediary for its clients, collecting payments, delivering purchases, and serving as a guarantor of authenticity. The company's offerings had expanded to include diamonds (via the Teletrade purchase), movie posters, music memorabilia, fine art, and coins.

Moving into the global market, the company held a 50 percent interest in GMAI-Asia.com, a Chinese Web auctioneer.

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