Great Elm Group Inc Reports Substantial Revenue Growth and Net Income Turnaround in Q1 Fiscal 2024
Great Elm Group Inc (NASDAQ:GEG) reports a 78% increase in total revenue for Q1 fiscal 2024, reaching $3.3 million.
Net income from continuing operations shows a significant positive shift to $2.8 million, compared to a net loss of ($9.5) million in the prior-year period.
Fee paying assets under management rose to $451.4 million, marking a 5% year-over-year increase.
GEG's Board of Directors approves a stock repurchase program of up to $10 million.
Great Elm Group Inc (NASDAQ:GEG), an alternative asset manager, has released its financial results for the first quarter of fiscal year 2024, ending September 30, 2023. The company has reported a substantial increase in total revenue and a significant turnaround from a net loss to net income in its continuing operations.
Fiscal First Quarter 2024 Performance
For the quarter ended September 30, 2023, GEG's total revenue surged by 78% to $3.3 million, up from $1.9 million in the same period last year. This increase was primarily attributed to a $1.3 million incentive fee collected from Great Elm Capital Corp. (GECC). The company's net income from continuing operations was $2.8 million, a stark contrast to the net loss of ($9.5) million reported in the prior-year period. Adjusted EBITDA also saw a positive movement, reaching $1.7 million, compared to $0.7 million for the previous year.
Financial Position and Stock Repurchase Program
As of September 30, 2023, GEG held approximately $76 million in cash and marketable securities. Additionally, the Board of Directors has authorized a stock repurchase program, allowing the company to buy back up to $10 million of its outstanding common stock.
Management's Outlook
CEO Jason Reese expressed satisfaction with the company's progress, highlighting the successful performance of GECC and the expansion of the Monomoy portfolio. Reese emphasized the company's focus on scaling core businesses, launching new fund products, and deploying capital into new opportunities with compelling risk-adjusted returns.
Detailed Financial Tables
The condensed consolidated balance sheets show total assets of $136.242 million as of September 30, 2023, with current assets including $41.077 million in cash and cash equivalents and $34.783 million in marketable securities. The condensed consolidated statements of operations reveal a net income of $2.774 million for the three months ended September 30, 2023, with basic and diluted net income per share from continuing operations at $0.09 and $0.08, respectively.
Adjusted EBITDA Reconciliation
The reconciliation from net income from continuing operations to Adjusted EBITDA for the quarter ended September 30, 2023, shows an Adjusted EBITDA of $1.724 million, considering interest expense, income tax expense, depreciation and amortization, non-cash compensation, and other adjustments.
In conclusion, Great Elm Group Inc (NASDAQ:GEG) has demonstrated a robust financial performance in the first quarter of fiscal 2024, with significant revenue growth and a turnaround to profitability in its continuing operations. The company's strategic focus on asset management and growth initiatives, coupled with a strong balance sheet and a new stock repurchase program, positions it well for future success. Investors and stakeholders can look forward to GEG's continued progress as it capitalizes on new opportunities and strives to enhance shareholder value.
For more detailed information on Great Elm Group Inc's financial results, please visit www.greatelmgroup.com or access the full earnings report and conference call presentation through the links provided in the earnings release.
Explore the complete 8-K earnings release (here) from Great Elm Group Inc for further details.
This article first appeared on GuruFocus.
