-Company Posts Profitable Operating Results,
with Strong Balance Sheet-
-Enters Beta Testing Phase for New Fintech
App, Expected Soft Launch Later this Calendar Year-
The Marygold Companies, Inc. (“TMC,” or the “Company”) (NYSE
American: MGLD), a diversified global holding firm, today reported
financial results for the second fiscal quarter and six months
ended December 31, 2022.
Net revenue for the second fiscal quarter of 2023 was $8.8
million, versus $9.4 million for the comparable prior year period.
Net income for the 2023 second fiscal quarter amounted to $181,794,
equal to approximately breakeven per share, compared with $1.0
million, or $0.03 per diluted share, for the same quarter of the
prior fiscal year.
For the first half of the current fiscal year, net revenue was
$17.7 million, versus $19.2 million a year ago. Net income for the
six months ended December 31, 2022 increased to $678,962, equal to
$0.02 per diluted share, compared with a net loss of 857,658, or a
net loss of $0.02 per share, in the same period a year ago, which
included a legal settlement of $2.5 million in last fiscal year’s
first quarter.
The Company’s balance sheet remained strong at December 31,
2022, with no debt. Cash and cash equivalents increased to $14.6
from $12.9 million at June 30, 2022. Total stockholders’ equity
rose to $29.8 million at December 31, 2022, from $29.0 million at
June 30, 2022, Total assets were $35.2 million at the close of the
second fiscal quarter of 2023, compared with $35.3 million at June
30, 2022, with the slight decrease principally reflecting currency
translation values in the Company’s foreign holdings.
“We are pleased to have achieved profitable operations during a
period in which continued investments were made in the late
development stages of our mobile fintech app at Marygold & Co.,
and when assets under management (AUM) at our largest subsidiary,
USCF Investments, were lower than in the prior year,” said David
Neibert, Chief Operations Officer of The Marygold Companies.
Average AUM at USCF Investments was approximately $3.8 billion in
the most recent quarter, compared with $4.2 billion for the end of
the comparable period last year.
“Our non-financial operations - Original Sprout, Gourmet Foods
and Brigadier Security Systems - felt the pressures of the
continued inflationary environment in the quarter, although each
was cash flow positive and posted operating income. Initiatives are
being implemented to enhance the performance of these business
units through changes in product mix and establishing new sales
channels,” Neibert added.
“All segments of our business are sound and performing on plan,
which we view as an outstanding achievement and a testament to our
dedicated team in today’s challenging economic climate,” said
Nicholas Gerber, TMC’s Chief Executive Officer. “At the same time,
we are making great strides completing the development of our
mobile fintech app to provide users with a unified platform for
spending, saving and investing, while offering detailed transaction
reporting coupled with ease of use. We expect to soft launch this
exciting product later this calendar year.”
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 12 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 in the development stage as it works
toward introduction of a fintech mobile banking app.
https://marygoldandco.com/.
Marygold & Co. (UK) Limited, formed in the U.K. during
August 2021, operates through its recently acquired subsidiary,
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 soft launch of the mobile fintech app later this
year, 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 28, 2022, 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)
December 31, 2022
June 30, 2022 (1)
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$
14,579,438
$
12,915,620
Accounts receivable, net
1,104,856
959,350
Accounts receivable - related parties
1,767,220
2,230,874
Inventories
2,583,935
2,200,742
Prepaid income tax and tax receivable
1,046,909
1,166,318
Investments, at fair value
4,346,998
5,065,931
Other current assets
735,834
699,547
Total current assets
26,165,190
25,238,382
Restricted cash
406,642
1,013,279
Property, plant and equipment, net
1,306,675
1,391,894
Operating lease right-of-use asset
1,216,302
1,357,686
Goodwill
2,307,202
2,307,202
Intangible assets, net
2,509,098
2,708,896
Deferred tax assets, net - United
States
753,078
753,078
Other assets, long - term
552,660
540,160
Total assets
$
35,216,847
$
35,310,577
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses
$
2,720,350
$
2,805,790
Expense waivers – related parties
163,576
70,199
Operating lease liabilities, current
portion
682,484
660,957
Purchase consideration payable
604,990
1,237,207
Loans - property and equipment, current
portion
33,384
33,496
Total current liabilities
4,204,784
4,807,649
LONG-TERM LIABILITIES
Loans - property and equipment, net of
current portion
427,490
459,178
Operating lease liabilities, net of
current portion
569,190
743,923
Deferred tax liabilities, net-foreign
260,553
260,553
Total long-term liabilities
1,257,233
1,463,654
Total liabilities
5,462,017
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 December 31, 2022 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 December 31, 2022 and at June 30, 2022
39,384
39,384
Additional paid-in capital
12,329,609
12,313,205
Accumulated other comprehensive loss
(214,600
)
(234,790
)
Retained earnings
17,600,388
16,921,426
Total stockholders' equity
29,754,830
29,039,274
Total liabilities and stockholders'
equity
$
35,216,847
$
35,310,577
(1)
Derived from audited financial
statements
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (LOSS)
(UNAUDITED)
Three Months Ended December
31, 2022
Three Months Ended December
31, 2021
Six Months Ended December 31,
2022
Six Months Ended December 31,
2021
Net revenue
Fund management - related party
$
5,266,171
$
5,701,384
$
10,685,606
$
11,358,411
Food products
1,932,304
2,108,257
3,869,752
4,468,402
Security systems
665,028
642,623
1,294,860
1,333,253
Beauty products
784,463
992,852
1,588,541
2,013,924
Financial services
124,282
-
257,775
-
Net revenue
8,772,248
9,445,116
17,696,534
19,173,990
Cost of revenue
2,230,954
2,417,798
4,255,969
5,068,538
Gross profit
6,541,294
7,027,318
13,440,565
14,105,452
Operating expense
Salaries and compensation
2,804,759
2,576,285
5,173,141
4,707,440
General and administrative expense
1,820,469
1,198,209
3,511,867
3,317,711
Fund operations
1,112,244
1,102,237
2,252,832
2,203,853
Marketing and advertising
555,939
690,831
1,328,749
1,409,486
Depreciation and amortization
147,769
133,191
296,985
287,849
Legal settlement
-
-
-
2,500,000
Total operating expenses
6,441,180
5,700,753
12,563,574
14,426,339
Income (loss) from operations
100,114
1,326,565
876,991
(320,887
)
Other income (expense):
Interest and dividend income
62,630
6,088
115,193
13,484
Interest expense
(3,596
)
(10,085
)
(11,403
)
(20,285
)
Other income (expense)
129,975
(214,981
)
31,761
(206,973
)
Total other income (expense), net
189,009
(218,978
)
135,551
(213,774
)
Income (loss) before income taxes
289,123
1,107,587
1,012,542
(534,661
)
Provision for income taxes
(107,329
)
(84,252
)
(333,580
)
(322,997
)
Net income (loss)
$
181,794
$
1,023,335
$
678,962
$
(857,658
)
Weighted average shares of common
stock
Basic
40,370,659
38,473,159
40,370,659
38,473,159
Diluted
40,370,659
38,473,159
40,383,722
38,473,159
Net income (loss) per common share
Basic and diluted
$
0.00
$
0.03
$
0.02
$
(0.02
)
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
Three Months Ended December
31, 2022
Three Months Ended December
31, 2021
Six Months Ended December 31,
2022
Six Months Ended December 31,
2021
Net income (loss)
$
181,794
$
1,023,335
$
678,962
$
(857,658
)
Other comprehensive income (loss):
Foreign currency translation gain
(loss)
333,949
(14,442
)
20,190
(100,610
)
Comprehensive income (loss)
$
515,743
$
1,008,893
$
699,152
$
(958,268
)
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE THREE AND SIX MONTH
PERIODS ENDED DECEMBER 31, 2022 AND DECEMBER 31, 2021
(UNAUDITED)
Period Ending December 31, 2022
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, 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
Gain on currency translation
-
-
-
-
-
333,949
-
333,949
Stock-based compensation
-
-
-
-
9,704
-
-
9,704
Net income
-
-
-
-
-
-
181,794
181,794
Balance at December 31, 2022
49,360
$
49
39,383,459
$
39,384
$
12,329,609
$
(214,600
)
$
17,600,388
$
29,754,830
Period Ending December 31, 2021
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
-
-
-
-
-
(86,168
)
-
(86,168
)
Net loss
-
-
-
-
-
-
(1,880,993
)
(1,880,993
)
Balance at September 30, 2021
49,360
$
49
37,485,959
$
37,486
$
9,330,843
$
56,413
$
13,894,712
$
23,319,503
Loss on currency translation
-
-
-
-
-
(14,442
)
-
(14,442
)
Net income
-
-
-
-
-
-
1,023,335
1,023,335
Balance at December 31, 2021
49,360
$
49
37,485,959
$
37,486
$
9,330,843
$
41,971
$
14,918,047
$
24,328,396
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
For the Six Month Period
Ended
December 31,
2022
2021
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss)
$
678,962
$
(857,658
)
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation and amortization
296,985
287,849
Bad debt expense
582
-
Impairment to inventory value
288
3,478
Stock-based compensation
16,404
-
Unrealized gain on investments
(11,020
)
(29,251
)
Loss on disposal of equipment
-
37,189
Operating lease right-of-use asset -
non-cash lease cost
147,363
337,850
Decrease (increase) in current assets:
Accounts receivable, net
(199,029
)
(118,395
)
Accounts receivable - related party
463,654
256,020
Prepaid income taxes and tax
receivable
121,124
(324,699
)
Inventories
(360,765
)
(196,514
)
Other current assets
(33,427
)
(74,549
)
(Decrease) increase in current
liabilities:
Accounts payable and accrued expenses
(43,698
)
(486,835
)
Operating lease liabilities
(153,206
)
(341,411
)
Expense waivers - related party
93,378
59,064
Net cash provided by (used in) operating
activities
1,017,595
(1,447,862
)
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of property, plant and
equipment
(34,777
)
(3,988
)
Purchase consideration payable
(633,893
)
-
Proceeds from sale of investments
1,000,000
506,492
Purchase of investments
(266,680
)
(1,533,385
)
Net cash provided by (used in) investing
activities
64,650
(1,030,881
)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Repayment of property and equipment
loans
(7,099
)
(7,208
)
Principal payments of finance lease
liability
(5,573
)
(1,753
)
Issuance costs pursuant to planned stock
issuance
-
(249,720
)
Net cash used in financing activities
(12,672
)
(258,681
)
Effect of exchange rate change on cash and
cash equivalents
(12,392
)
(50,404
)
NET INCREASE (DECREASE) IN CASH, CASH
EQUIVALENTS AND RESTRICTED CASH
1,057,181
(2,787,828
)
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, BEGINNING BALANCE
13,928,899
16,086,944
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, ENDING BALANCE
$
14,986,080
$
13,299,116
Cash and cash equivalents
14,579,438
13,285,452
Restricted cash
406,642
13,664
Total cash, cash equivalents and
restricted cash shown in statement of cash flows
$
14,986,080
$
13,299,116
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Cash paid during the period for:
Interest paid
$
7,855
$
8,046
Income taxes paid, net
$
164,396
$
632,961
NON CASH INVESTING AND FINANCING
ACTIVITIES:
Acquisition of operating right-of-use
assets through operating lease liability
$
103,609
995,805
Acquisition of equipment through finance
lease liability
$
-
$
150,625
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/20230214005844/en/
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
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