The Marygold Companies Reports Fiscal 2023/Q4 Financial Results

- Company Reports Profitable Performance, Maintains Strong Balance Sheet -

SAN CLEMENTE, Calif., September 25, 2023--(BUSINESS WIRE)--The Marygold Companies, Inc. ("TMC" or the "Company") (NYSE American: MGLD) (formerly Concierge Technologies, Inc.), a diversified global holding firm, today reported financial results for the fiscal year ended June 30, 2023.

Net revenues for the 2023 fiscal year amounted to $34.9 million, compared with $37.8 million for the 2022 fiscal year. Net income for fiscal 2023 rose slightly to $1.2 million, equal to $0.03 per fully diluted share, from $1.1 million, also equal to $0.03 per fully diluted share, in the prior fiscal year.

For the fourth quarter ended June 30, 2023, revenues were $8.9 million, compared with $9.9 million for the same period last year. Net income for the most recent fourth quarter was $326 thousand, equal to $.01 per share, compared with $1.1 million, or $0.3 per fully diluted share, for the prior year period.

The Company’s balance sheet remained strong at the close of the 2023 fiscal year. Total stockholders’ equity rose to $30.4 million at June 30, 2023, from $29.0 million a year ago. Total assets at fiscal year-end remained constant at $35.3 million. Cash and cash equivalents at the close of fiscal 2023 were $8.2 million, versus $12.9 million at June 30, 2022, with the decline principally attributable to a movement of cash to short term equity investments, which increased to $11.5 million versus $5.1 million in the prior year, as well as expenses associated with completing the development of the Company’s mobile fintech app, which recently was soft-launched by TMC’s subsidiary, Marygold & Co. TMC again ended the year essentially debt-free.

Lower assets under management (AUM) at TMC’s principal subsidiary, USCF Investments, along with new fund startup costs, impacted USCF’s revenues for fiscal 2023, which amounted to $20.9 million, versus $23.8 million for the prior year. USCF had average AUM of $3.7 billion for fiscal 2023, compared with $4.4 billion last year.

Results for The Marygold Companies’ other principal operating subsidiaries – Gourmet Foods, Brigadier Security Systems, Marygold & Co (UK), and Original Sprout – were impacted by a number of factors during fiscal 2023, including the inflationary pressures that affected the cost of raw materials, along with higher shipping and labor expenses and unfavorable currency translation at the Company’s New Zealand operation.

"Gourmet Foods, Brigadier Security Systems, and Marygold & Co (UK) were all profitable for the year, however Original Sprout sustained an operating loss, as it shifts its business model to address post-COVID-19 changes in consumer buying habits. While Original Sprout faced an erosion of profit margins and a fragmented sales channel during the past year due to online shopping trends effecting its long-standing domestic distribution model, management is in the final stages of correcting this situation and expects a return to growth in the new fiscal year.

"Additionally, we are anticipating moderate growth at Brigadier through new, focused management initiatives and partnering with local telecoms and contractors, and we expect Gourmet Foods to be operating more efficiently, as low margin products are eliminated and new channels to market are established," Neibert added.

Nicholas Gerber, TMC’s Chief Executive Officer, said, "Fiscal 2023 marked the completion of the initial development stage and the nationwide soft launch of our new mobile fintech app, an innovative digital platform that enables users to spend, invest and save with FDIC-insured accounts. The launch culminated nearly four years of development and more than $9 million of investments by TMC, entirely funded from internal cash flow, while our Company remained debt-free. We look forward to implementing marketing plans for the app in the new fiscal year."

"As CEO, I appreciate the talent and hard work it has taken for us to reach this product development milestone," Gerber said. "As well, I wish to thank our shareholders for their patience and express my gratitude to the entire Marygold team throughout the world for their dedication to making our Company a success and for working collaboratively and diligently to position TMC for future growth and to create long-term value for of 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, a return to growth for the Original Sprout subsidiary, growth at Brigadier and implanting marketing plans for the Company’s new fintech mobile banking app, 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
CONSOLIDATED BALANCE SHEETS
		June 30, 2023				June 30, 2022
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	8,161,167			$	12,915,620
Accounts receivable, net			1,352,210				959,350
Accounts receivable - related parties			1,673,895				2,230,874
Inventories			2,254,139				2,200,742
Prepaid income tax and tax receivable			991,797				1,166,318
Investments, at fair value			11,480,981				5,065,931
Other current assets			904,153				699,547
Total current assets			26,818,342				25,238,382
Restricted cash			425,043				1,013,279
Property, plant and equipment, net			1,255,302				1,391,894
Operating lease right-of-use asset			821,021				1,357,686
Goodwill			2,307,202				2,307,202
Intangible assets, net			2,329,970				2,708,896
Deferred tax assets, net - United States			771,287				753,078
Other assets			552,660				540,160
Total assets		$	35,280,827			$	35,310,577
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses		$	2,711,931			$	2,805,790
Expense waivers – related parties			58,685				70,199
Operating lease liabilities, current portion			457,309				660,957
Purchase consideration payable			604,990				1,237,207
Loans - property and equipment, current portion			358,802				33,496
Total current liabilities			4,191,717				4,807,649
LONG-TERM LIABILITIES
Loans - property and equipment, net of current portion			88,516				459,178
Operating lease liabilities, net of current portion			380,535				743,923
Deferred tax liabilities, net - foreign			242,289				260,553
Total long-term liabilities			711,340				1,463,654
Total liabilities			4,903,057				6,271,303
STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par value; 50,000,000 shares authorized
Series B: 49,360 shares issued and outstanding at June 30, 2023 and at June 30, 2022			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, 2022			39,384				39,384
Additional paid-in capital			12,396,722				12,313,205
Accumulated other comprehensive loss			(144,840	)			(234,790	)
Retained earnings			18,086,455				16,921,426
Total stockholders' equity			30,377,770				29,039,274
Total liabilities and stockholders' equity		$	35,280,827			$	35,310,577

THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
		Year Ended June 30, 2023				Year Ended June 30, 2022
Net revenue
Fund management - related party		$	20,862,191			$	23,835,348
Food products			7,631,837				7,930,888
Security systems			2,832,531				2,533,098
Beauty products			3,033,100				3,529,789
Financial services			517,075				-
Net revenue			34,876,734				37,829,123
Cost of revenue			8,750,546				9,194,783
Gross profit			26,126,188				28,634,340
Operating expense
Salaries and compensation			10,042,155				8,812,081
General and administrative expense			7,075,639				6,794,645
Fund operations			4,387,004				4,600,535
Marketing and advertising			2,623,965				2,985,659
Depreciation and amortization			577,086				561,019
Legal settlement			-				2,500,000
Total operating expenses			24,705,849				26,253,939
Income from operations			1,420,339				2,380,401
Other income (expense):
Interest and dividend income			274,932				35,357
Interest expense			(19,940	)			(31,512	)
Other (expense), net			(81,313	)			(26,125	)
Total other income (expense), net			173,679				(22,280	)
Income before income taxes			1,594,018				2,358,121
Provision of income taxes			(428,989	)			(1,212,400	)
Net income		$	1,165,029			$	1,145,721
Weighted average shares of common stock
Basic			40,370,659				39,034,611
Diluted			40,403,999				39,034,611
Net income per common share
Basic		$	0.03			$	0.03
Diluted		$	0.03			$	0.03

THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
		Year Ended June 30, 2023				Year Ended June 30, 2022
Net income		$	1,165,029			$	1,145,721
Other comprehensive income:
Foreign currency translation gain (loss)			89,950				(377,371	)
Comprehensive income		$	1,254,979			$	768,350

THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED JUNE 30, 2023 AND 2022
Period Ending June 30, 2023		Preferred Stock (Series B)								Common Stock
		Number of Shares				Amount				Number of Shares				Par Value				Additional Paid - in Capital				Accumulated Other Comprehensive Income (Loss)				Retained Earnings				Total Stockholders' Equity
Balance at July 1, 2021			49,360			$	49				37,485,959			$	37,486			$	9,330,843			$	142,581			$	15,775,705			$	25,286,664
Loss on currency translation			-				-				-				-				-				(377,371	)			-				(377,371	)
Issuance of common stock in public offering, net of issuance costs $549,090			-				-				1,897,500				1,898				2,982,362				-				-				2,984,260
Net income			-				-				-				-				-				-				1,145,721				1,145,721
Balance at June 30, 2022			49,360			$	49				39,383,459			$	39,384			$	12,313,205			$	(234,790	)		$	16,921,426			$	29,039,274
Gain on currency translation			-				-				-				-				-				89,950				-				89,950
Stock-based compensation			-				-				-				-				83,517				-				-				83,517
Net income			-				-				-				-				-				-				1,165,029				1,165,029
Balance at June 30, 2023			49,360			$	49				39,383,459			$	39,384			$	12,396,722			$	(144,840	)		$	18,086,455			$	30,377,770

THE MARYGOLD COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
		For the Year Ended
		June 30,
		2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	1,165,029			$	1,145,721
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			577,086				561,019
Bad debt expense			1,427				4,350
Impairment of inventory value and provision			2,698				10,509
Deferred taxes			(36,474	)			51,689
Stock-based compensation			83,517				-
Unrealized loss (gain) on investments			125,570				(28,474	)
Gain on disposal of equipment			-				(17,455	)
Operating lease right-of-use asset - non-cash lease cost			656,600				764,311
Decrease (increase) in current assets:
Accounts receivable			(411,175	)			44,356
Accounts receivable - related party			556,979				(192,820	)
Prepaid income taxes and tax receivable			172,592				(431,005	)
Inventories			(81,868	)			(379,905	)
Other current assets			(204,417	)			(287,750	)
(Decrease) increase in operating liabilities:
Accounts payable, accrued expenses and legal settlement			(74,022	)			(1,048,279	)
Operating lease liabilities			(670,639	)			(777,082	)
Expense waivers - related party			(11,514	)			515
Net cash provided by (used in) operating activities			1,851,389				(580,300	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for acquisition of business, net			-				(508,851	)
Proceeds from sale of property, plant and equipment			-				31,612
Purchase of property, plant and equipment			(94,730	)			(44,041	)
Payment of purchase consideration payable			(623,592	)			-
Proceeds from sale of investments			9,281,197				508,122
Purchase of investments			(15,855,058	)			(3,712,250	)
Net cash used in investing activities			(7,292,183	)			(3,725,408	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of related party loans			-				(603,500	)
Repayment of property and equipment loans			(14,732	)			(41,884	)
Principal payments of finance lease liability			(5,573	)			-
Proceeds from issuance of common stock, net of issuance costs			-				2,984,260
Net cash (used in) provided by financing activities			(20,305	)			2,338,876
Effect of exchange rate change on cash and cash equivalents			118,410				(191,213	)
NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH			(5,342,689	)			(2,158,045	)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING BALANCE			13,928,899				16,086,944
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE		$	8,586,210			$	13,928,899
Cash and cash equivalents			8,161,167				12,915,620
Restricted cash			425,043				1,013,279
Total cash, cash equivalents and restricted cash shown in statement of cash flows		$	8,586,210			$	13,928,899
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest paid		$	15,493			$	16,401
Income taxes paid, net		$	231,693			$	1,704,970
NON CASH INVESTING AND FINANCING ACTIVITIES:
Purchase consideration payable		$	-			$	1,237,207
Acquisition of operating right-of-use assets through operating lease liability		$	103,603			$	1,057,965
Fair value of warrants of common stock issued to underwriters		$	-			$	132,000
Acquisition of equipment through finance lease liability		$	-			$	150,625

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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