The Marygold Companies Reports Financial Results for 2024 First Fiscal Quarter
SAN CLEMENTE, Calif., November 13, 2023--(BUSINESS WIRE)--The Marygold Companies, Inc. ("TMC," or the "Company") (NYSE American: MGLD), a diversified global holding firm, today reported financial results for the 2024 first fiscal quarter ended September 30, 2023.
Net revenues for the three months ended September 30, 2023 were $8.2 million, versus $8.9 million last year. The Company registered a net loss of $500 thousand, equal to a loss of $0.1 per share, for the fiscal 2024 first quarter, principally reflecting continued investment in the Marygold & Co. fintech app, compared with net income of $497 thousand, or $0.01 per share, last year.
TMC’s balance sheet remained strong at September 30, 2023. Cash and cash equivalents amounted to $7.0 million at the end of the quarter, and the Company has essentially no debt. Total assets at September 30, 2023, were $35.5 million, and total stockholders’ equity at the quarter’s end was $30.0 million.
"Good progress was made during the quarter on an operational basis, and the Company remains cash flow positive," said David Neibert, TMC’s Chief Operations Officer. "Net income at the operating subsidiary levels was slightly lower than the comparative year period, due to several factors, including: a strengthening of the US dollar in our foreign markets, reflecting a lower value in currency translation; marketing expenses in connection with the rollout of a new product line by our Original Sprout subsidiary; and, most impactfully, by higher expenses in connection with the final stages of development and initial marketing of our mobile fintech app by our Marygold & Co. subsidiary. Our USCF Investments subsidiary and our core businesses remain strong, with the revenue downturn for the first quarter well within our range of acceptable volatility. We plan to continue investing in the fintech space, which will continue to impact earnings for the short term, as we set the stage for TMC’s renewed focus on the financial services sector in the coming years."
Nicholas Gerber, TMC’s Chief Executive Officer, said, "While we strive to maintain cash flow neutral operating results as we calculate our investment in Marygold & Co., economic conditions beyond our control impacted our performance for the quarter ended September 30, 2023. Our goal is to successfully put the foundational building blocks together for a sustainable, profitable, long-term future, while remaining debt free and maintaining a high level of cash reserves. From our exciting new mobile fintech app and financial services offerings to the innovative new products and services produced and provided by our other operating units, our objective is to enhance long-term value for all of our stakeholders."
Business Units
The Company’s USCF Investments subsidiary, www.uscfinvestments.com, acquired in December 2016 and based in Walnut Creek, Calif., serves as manager, operator or investment adviser to 15 exchange traded products, structured as limited partnerships or investment trusts that issue shares trading on the NYSE Arca.
Gourmet Foods, https://gourmetfoodsltd.co.nz/, acquired in August 2015, is a commercial-scale bakery that produces and distributes iconic meat pies and pastries throughout New Zealand under the brand names Pat’s Pantry and Ponsonby Pies. Acquired by Gourmet Foods in July 2020, Printstock Products Limited https://www.printstocknz.com/, is a printer of specialized food wrappers and is located in Napier, New Zealand. Its operations are consolidated with those of Gourmet Foods.
Brigadier Security Systems, www.brigadiersecurity.com, acquired in June 2016 and headquartered in Saskatoon, Canada, provides comprehensive security solutions to homes and businesses, government offices, schools and other public buildings throughout the province under the brands Brigadier Security Systems in Saskatoon and Elite Security in Regina, Canada.
Acquired at the end of 2017, San Clemente, Calif.-based Original Sprout, www.originalsprout.com, produces and distributes a full line of vegan, safe, non-toxic hair and skin care products, including a "reef safe" sun screen, in the U.S. and its territories, the U.K., E.U., Turkey, Middle East, Africa, Taiwan, Mexico, South America, Singapore, Hong Kong, Malaysia, New Zealand, Australia and Canada among other areas.
Marygold & Co., formed in the U.S. during 2019 and operating from offices in Denver, CO, together with its wholly owned subsidiary, Marygold & Co. Advisory Services, LLC, was established to explore opportunities in the financial technology sector. The company continues further development of a fintech mobile banking app., having completed the initial development stage and soft launch in the U.S. in June 2023. https://marygoldandco.com/
Marygold & Co. (UK) Limited, formed in the U.K. during August 2021, operates through its subsidiary acquired in 2022, Tiger Financial & Asset Management Limited ("Tiger"), a U.K. based investment adviser. Tiger’s core business is managing clients’ financial wealth across a diverse product range, including cash, national savings, individual savings accounts, unit trusts, insurance company products such as investment bonds and other investment vehicles. http://www.tfam.co.uk/
About The Marygold Companies, Inc.
The Marygold Companies, Inc., which changed its name from Concierge Technologies, Inc. in March 2022, was founded in 1996 and repositioned as a global holding firm in 2015. The Company currently has operating subsidiaries in financial services, food manufacturing, printing, security systems and beauty products, under the trade names USCF Investments, Tiger Financial & Asset Management Limited, Gourmet Foods, Printstock Products, Brigadier Security Systems and Original Sprout, respectively. Offices and manufacturing operations are in the U.S., New Zealand, U.K., and Canada. For more information, visit www.themarygoldcompanies.com.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of U.S. federal securities laws. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may" "will," "could," "should" "believes," "predicts," "potential," "continue" and similar expressions are intended to identify such forward-looking statements. These forward-looking statements, including, but not limited to, tangible benefits expected to be realized in the 2024 calendar year from current investments, involve significant risks and uncertainties that could cause actual results to differ materially from the expected results and, consequently, should not be relied upon as predictions of future events. These forward-looking statements, including the factors disclosed in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on September 25, 2023, and in the Company’s other filings with the Securities and Exchange Commission, are not exclusive. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Except as required by law, the Company disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this press release.
THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(UNAUDITED) | ||||||||
September 30, | June 30, 2023 | |||||||
ASSETS | ||||||||
CURRENT ASSETS | ||||||||
Cash and cash equivalents | $ | 6,987,062 | $ | 8,161,167 | ||||
Accounts receivable, net | 851,570 | 1,352,210 | ||||||
Accounts receivable - related parties | 1,669,886 | 1,673,895 | ||||||
Inventories | 2,194,827 | 2,254,139 | ||||||
Prepaid income tax and tax receivable | 1,350,165 | 991,797 | ||||||
Investments, at fair value | 13,261,783 | 11,480,981 | ||||||
Other current assets | 973,562 | 904,153 | ||||||
Total current assets | 27,288,855 | 26,818,342 | ||||||
Restricted cash | 413,454 | 425,043 | ||||||
Property, plant and equipment, net | 1,209,739 | 1,255,302 | ||||||
Operating lease right-of-use asset | 701,248 | 821,021 | ||||||
Goodwill | 2,307,202 | 2,307,202 | ||||||
Intangible assets, net | 2,220,755 | 2,329,970 | ||||||
Deferred tax assets, net - United States | 771,287 | 771,287 | ||||||
Other assets | 552,660 | 552,660 | ||||||
Total assets | $ | 35,465,200 | $ | 35,280,827 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
CURRENT LIABILITIES | ||||||||
Accounts payable and accrued expenses | $ | 3,491,543 | $ | 2,711,931 | ||||
Expense waivers – related parties | 107,213 | 58,685 | ||||||
Operating lease liabilities, current portion | 361,013 | 457,309 | ||||||
Purchase consideration payable | 604,990 | 604,990 | ||||||
Loans - property and equipment, current portion | 346,282 | 358,802 | ||||||
Total current liabilities | 4,911,041 | 4,191,717 | ||||||
LONG-TERM LIABILITIES | ||||||||
Loans - property and equipment, net of current portion | 82,543 | 88,516 | ||||||
Operating lease liabilities, net of current portion | 352,347 | 380,535 | ||||||
Deferred tax liabilities, net - foreign | 242,289 | 242,289 | ||||||
Total long-term liabilities | 677,179 | 711,340 | ||||||
Total liabilities | 5,588,220 | 4,903,057 | ||||||
STOCKHOLDERS’ EQUITY | ||||||||
Preferred stock, $0.001 par value; 50,000,000 shares authorized Series B: 49,360 shares issued and outstanding at September 30, 2023 and at June 30, 2023 | 49 | 49 | ||||||
Common stock, $0.001 par value; 900,000,000 shares authorized; 39,383,459 shares issued and outstanding at June 30, 2023 and at June 30, 2023 | 39,384 | 39,384 | ||||||
Additional paid-in capital | 12,490,352 | 12,396,722 | ||||||
Accumulated other comprehensive loss | (239,079 | ) | (144,840 | ) | ||||
Retained earnings | 17,586,274 | 18,086,455 | ||||||
Total stockholders’ equity | 29,876,980 | 30,377,770 | ||||||
Total liabilities and stockholders’ equity | $ | 35,465,200 | $ | 35,280,827 | ||||
THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME | ||||||||
(UNAUDITED) | ||||||||
Three Months | Three Months | |||||||
Net revenue | ||||||||
Fund management – related party | $ | 5,049,550 | $ | 5,419,435 | ||||
Food products | 1,730,527 | 1,937,426 | ||||||
Security systems | 553,719 | 628,892 | ||||||
Beauty products | 774,626 | 804,078 | ||||||
Financial services | 127,092 | 133,457 | ||||||
Net revenue | 8,235,514 | 8,923,288 | ||||||
Cost of revenue | 2,037,188 | 2,023,664 | ||||||
Gross profit | 6,198,326 | 6,899,624 | ||||||
Operating expense | ||||||||
Salaries and compensation | 2,589,949 | 2,368,368 | ||||||
General and administrative expense | 2,248,540 | 1,686,658 | ||||||
Fund operations | 1,270,128 | 1,140,588 | ||||||
Marketing and advertising | 972,011 | 777,710 | ||||||
Depreciation and amortization | 153,977 | 149,208 | ||||||
Total operating expenses | 7,234,605 | 6,122,532 | ||||||
(Loss) income from operations | (1,036,279 | ) | 777,092 | |||||
Other income (expense): | ||||||||
Interest and dividend income | 193,043 | 52,569 | ||||||
Interest expense | (3,559 | ) | (7,794 | ) | ||||
Other income (expense), net | 43,993 | (98,369 | ) | |||||
Total other income (expense), net | 233,477 | (53,594 | ) | |||||
(Loss) income before income taxes | (802,802 | ) | 723,498 | |||||
Benefit (Provision) of income taxes | 302,621 | (226,330 | ) | |||||
Net (loss) income | $ | (500,181 | ) | $ | 497,168 | |||
Weighted average shares of common stock | ||||||||
Basic | 40,397,375 | 40,370,659 | ||||||
Diluted | 40,397,375 | 40,399,873 | ||||||
Net (loss) income per common share | ||||||||
Basic | $ | (0.01 | ) | $ | 0.01 | |||
Diluted | $ | (0.01 | ) | $ | 0.01 | |||
THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME | ||||||||
(UNAUDITED) | ||||||||
Three Months | Three Months | |||||||
Net (loss) income | $ | (500,181 | ) | $ | 497,168 | |||
Other comprehensive (loss) income: | ||||||||
Foreign currency translation (loss) | (94,239 | ) | (313,759 | ) | ||||
Comprehensive (loss) income | $ | (594,420 | ) | $ | 183,409 | |||
THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||||||||||
FOR THE THREE MONTH PERIODS ENDED SEPTEMBER 30, 2023 AND SEPTEMBER 30, 2022 | ||||||||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||||||||
Period Ending | Preferred Stock | Common Stock | Additional | Accumulated | Total | |||||||||||||||||||||||||||
Number of | Amount | Number of | Par | Paid – in | Comprehensive | Retained | Stockholders’ | |||||||||||||||||||||||||
Balance at July 1, 2023 | 49,360 | $ | 49 | 39,383,459 | $ | 39,384 | $ | 12,396,722 | $ | (144,840 | ) | $ | 18,086,455 | $ | 30,377,770 | |||||||||||||||||
Loss on currency translation | - | - | - | - | - | (94,239 | ) | - | (94,239 | ) | ||||||||||||||||||||||
Stock-based compensation | - | - | - | - | 93,630 | - | - | 93,630 | ||||||||||||||||||||||||
Net (loss) | - | - | - | - | - | - | (500,181 | ) | (500,181 | ) | ||||||||||||||||||||||
Balance at September 30, 2023 | 49,360 | $ | 49 | 39,383,459 | $ | 39,384 | $ | 12,490,352 | $ | (239,079 | ) | $ | 17,586,274 | $ | 29,876,980 | |||||||||||||||||
Period Ending | Preferred Stock | Common Stock | Additional | Accumulated | Total | |||||||||||||||||||||||||||
Number of | Amount | Number of | Par | Paid – in | Comprehensive | Retained | Stockholders’ | |||||||||||||||||||||||||
Balance at July 1, 2022 | 49,360 | $ | 49 | 39,383,459 | $ | 39,384 | $ | 12,313,205 | $ | (234,790 | ) | $ | 16,921,426 | $ | 29,039,274 | |||||||||||||||||
Loss on currency translation | - | - | - | - | - | (313,759 | ) | - | (313,759 | ) | ||||||||||||||||||||||
Stock-based compensation | - | - | - | - | 6,700 | - | - | 6,700 | ||||||||||||||||||||||||
Net income | - | - | - | - | - | - | 497,168 | 497,168 | ||||||||||||||||||||||||
Balance at September 30, 2022 | 49,360 | $ | 49 | 39,383,459 | $ | 39,384 | $ | 12,319,905 | $ | (548,549 | ) | $ | 17,418,594 | $ | 29,229,383 | |||||||||||||||||
THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
For the Three Months Ended | ||||||||
September 30, | ||||||||
2023 | 2022 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net (loss) income | $ | (500,181 | ) | 497,168 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 153,977 | 149,208 | ||||||
Bad debt expense | 213 | - | ||||||
Stock-based compensation | 93,630 | 6,700 | ||||||
Net realized and unrealized (gains) losses on investments | (269,381 | ) | 111,855 | |||||
Operating lease right-of-use asset - non-cash lease cost | 128,403 | 231,070 | ||||||
Decrease (increase) in current assets: | ||||||||
Accounts receivable | 478,096 | (179,083 | ) | |||||
Accounts receivable - related party | 4,009 | 565,296 | ||||||
Prepaid income taxes and tax receivable | (359,021 | ) | 61,872 | |||||
Inventories | 34,198 | (194,695 | ) | |||||
Other current assets | (70,130 | ) | (34,814 | ) | ||||
(Decrease) increase in operating liabilities: | ||||||||
Accounts payable and accrued expenses | 668,487 | (149,343 | ) | |||||
Operating lease liabilities | (118,480 | ) | (233,992 | ) | ||||
Expense waivers - related party | 48,528 | 70,448 | ||||||
Purchase consideration payable | - | (22,493 | ) | |||||
Net cash provided by operating activities | 292,348 | 879,197 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Purchase of property, plant and equipment | (25,189 | ) | (9,418 | ) | ||||
Proceeds from sale of investments | 7,829,645 | - | ||||||
Purchase of investments | (9,341,066 | ) | (257,624 | ) | ||||
Net cash (used in) investing activities | (1,536,610 | ) | (267,042 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Repayment of property and equipment loans | (3,656 | ) | (3,476 | ) | ||||
Net cash (used in) by financing activities | (3,656 | ) | (3,476 | ) | ||||
Effect of exchange rate change on cash and cash equivalents | 62,224 | (237,331 | ) | |||||
NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (1,185,694 | ) | 371,348 | |||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING BALANCE | 8,586,210 | 13,928,899 | ||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE | $ | 7,400,516 | 14,300,247 | |||||
Cash and cash equivalents | 6,987,062 | 13,370,714 | ||||||
Restricted cash | 413,454 | 929,533 | ||||||
Total cash, cash equivalents and restricted cash shown in statement of cash flows | $ | 7,400,516 | 14,300,247 | |||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||||||||
Cash paid during the period for: | ||||||||
Interest paid | $ | 4,727 | 4,018 | |||||
Income taxes paid, net | $ | 86,978 | 70,557 | |||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
View source version on businesswire.com: https://www.businesswire.com/news/home/20231113014886/en/
Contacts
Media and investors, for more Information, contact:
Roger S. Pondel
PondelWilkinson Inc.
310-279-5965
rpondel@pondel.com
Contact the Company:
David Neibert, Chief Operations Officer
949-429-5370
dneibert@themarygoldcompanies.com
