-Company Continues to Post Profitable
Operating Results, with Strong Balance Sheet and Cash
Position-
The Marygold Companies, Inc. (“TMC,” or the “Company”) (NYSE
American: MGLD), a diversified global holding firm, today reported
financial results for the third fiscal quarter and nine-months
ended March 31, 2023.
Net revenue for the three months ended March 31, 2023 was $8.3
million, versus $8.9 million for the comparable prior year period.
The Company achieved net income of $153,294 for the current third
fiscal quarter, equal to breakeven per diluted share, compared with
$870,134 for the quarter ended March 31, 2022, or $0.02 per diluted
share.
For the first nine months of the current fiscal year, net
revenue was $15.7 million, versus $17.2 million in the comparable
period last year. Net income for the nine months ended March 31,
2023 increased to $832,256, equal to $0.02 per diluted share,
compared with $12,476, or breakeven per diluted share, in the same
period a year ago. Net income for last year’s nine-month period was
impacted by a $2.5 million legal settlement.
The Company maintained its strong balance sheet at March 31,
2023, with no debt. Cash and cash equivalents amounted to $9.9
million at the quarter’s end, compared with $12.9 million at June
30, 2022, with the decrease primarily reflecting continued
investments in the development of the Company’s new fintech app by
its subsidiary Marygold & Co. Total stockholders’ equity at
March 31, 2023 rose to $29.9 million, from $29.0 million at June
30, 2022. Total assets were $34.7 million at the close of the 2023
third fiscal quarter, compared with $35.3 million at June 30,
2022.
“The Company again achieved profitable operations for the third
fiscal quarter, as we continued to invest in the final stages of
development of our Marygold mobile fintech app,” said David
Neibert, Chief Operations Officer of The Marygold Companies. “Net
income and revenue also were impacted by lower assets under
management (AUM) at USCF Investments, which is our largest
subsidiary. Average AUM at USCF Investments was approximately $3.7
billion in the 2023 third quarter, compared with $4.4 billion last
year, with resulting lower management fees. The lower AUM is
attributed to the uncertain, and sometimes volatile, nature of the
commodities market in general and not an indication of any USCF
operating deficiencies.”
“Our non-financial operations – Food Products, Security Systems
and Beauty Products – were profitable overall for the third
quarter, with slightly increased revenues as a group. Inflationary
pressures again had an impact on margins at these business units,
and initiatives are progressing that are intended to enhance the
performance of these businesses through product mix changes and
entrance into new sales channels,” Neibert added.
Nicholas Gerber, TMC’s Chief Executive Officer, said,
“Notwithstanding the uncertain economic environment and turbulence
in the commercial banking and financial sector, TMC is performing
well and is on target to meet our objectives. We are optimistic
about the prospects for each of our operating units and
particularly excited by the early results of beta testing for our
Marygold mobile fintech app. Marygold has about 11,000 individuals
on a wait list who, during May and June, we intend to invite to
download and use the app. We expect a formal marketing campaign and
open commercial launch of the app in the near future. The entirety
of the Marygold app development has been accomplished by the use of
internal funds derived from existing profitable consolidated
operations. We are extremely proud of that accomplishment and that
TMC remains debt-free and without dilutive equity capital
raises.”
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 formal marketing campaign and open commercial launch
of the app in the near future, 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)
March 31, 2023
June 30, 2022 (1)
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$
9,858,277
$
12,915,620
Accounts receivable, net
1,089,286
959,350
Accounts receivable - related parties
1,745,159
2,230,874
Inventories
2,386,259
2,200,742
Prepaid income tax and tax receivable
1,034,746
1,166,318
Investments, at fair value
8,703,490
5,065,931
Other current assets
1,138,291
699,547
Total current assets
25,955,508
25,238,382
Restricted cash
417,467
1,013,279
Property, plant and equipment, net
1,288,421
1,391,894
Operating lease right-of-use asset
1,040,356
1,357,686
Goodwill
2,307,202
2,307,202
Intangible assets, net
2,420,029
2,708,896
Deferred tax assets, net - United
States
753,078
753,078
Other assets, long - term
552,660
540,160
Total assets
$
34,734,721
$
35,310,577
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses
$
2,414,628
$
2,805,790
Expense waivers – related parties
28,970
70,199
Operating lease liabilities, current
portion
578,030
660,957
Purchase consideration payable
604,990
1,237,207
Loans - property and equipment, current
portion
33,307
33,496
Total current liabilities
3,659,925
4,807,649
LONG-TERM LIABILITIES
Loans - property and equipment, net of
current portion
417,694
459,178
Operating lease liabilities, net of
current portion
488,424
743,923
Deferred tax liabilities, net-foreign
260,553
260,553
Total long-term liabilities
1,166,671
1,463,654
Total liabilities
4,826,596
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 March 31, 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 March 31, 2023 and at June 30, 2022
39,384
39,384
Additional paid-in capital
12,359,500
12,313,205
Accumulated other comprehensive loss
(244,490
)
(234,790
)
Retained earnings
17,753,682
16,921,426
Total stockholders' equity
29,908,125
29,039,274
Total liabilities and stockholders'
equity
$
34,734,721
$
35,310,577
(1) Derived from audited financial
statements
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended March 31,
2023
Three Months Ended March 31,
2022
Nine Months Ended March 31,
2023
Nine Months Ended March 31,
2022
Net revenue
Fund management - related party
$
5,022,398
$
5,868,558
$
15,708,004
17,226,969
Food products
1,824,789
1,667,345
5,701,714
6,131,791
Security systems
576,248
555,006
1,870,986
1,888,362
Beauty products
745,468
702,779
2,334,009
2,716,702
Financial services
129,868
-
387,811
-
Net revenue
8,298,771
8,793,688
26,002,524
27,963,824
Cost of revenue
2,194,762
2,065,422
6,449,457
7,132,249
Gross profit
6,104,009
6,728,266
19,553,067
20,831,575
Operating expense
Salaries and compensation
2,354,903
1,969,998
7,530,000
6,677,378
General and administrative expense
1,750,148
1,651,057
5,268,952
4,973,337
Fund operations
1,080,834
1,171,282
3,333,666
3,375,135
Marketing and advertising
612,333
755,403
1,936,504
2,160,180
Depreciation and amortization
139,656
136,909
436,685
424,727
Legal settlement
-
-
-
2,500,000
Total operating expenses
5,937,874
5,684,649
18,505,807
20,110,757
Income from operations
166,135
1,043,617
1,047,260
720,818
Other income (expense):
Interest and dividend income
58,690
5,546
173,875
19,030
Interest expense
(4,887
)
(9,856
)
(16,315
)
(30,142
)
Other income (expense)
(96,390
)
251,767
(67,644
)
46,398
Total other income (expense), net
(42,587
)
247,457
89,916
35,286
Income before income taxes
123,548
1,291,074
1,137,176
756,104
Benefit (provision) of income taxes
29,746
(420,940
)
(304,920
)
(743,628
)
Net income
$
153,294
$
870,134
$
832,256
$
12,476
Weighted average shares of common
stock
Basic
40,370,659
38,831,576
40,370,659
38,561,536
Diluted
40,438,348
38,831,576
40,401,952
38,561,536
Net income per common share
Basic
$
0.00
$
0.02
$
0.02
$
0.00
Diluted
$
0.00
$
0.02
$
0.02
$
0.00
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
Three Months Ended March 31,
2023
Three Months Ended March 31,
2022
Nine Months
Ended March 31, 2023
Nine Months Ended March 31,
2022
Net income
$
153,294
$
870,134
$
832,256
$
12,476
Other comprehensive (loss) income:
Foreign currency translation (loss)
gain
(29,890
)
79,394
(9,700
)
(21,216
)
Comprehensive income (loss)
$
123,404
$
949,528
$
822,556
$
(8,740
)
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE THREE AND NINE MONTH
PERIODS ENDED MARCH 31, 2023 AND MARCH 31, 2022
(UNAUDITED)
Period Ending March 31,
2023
Preferred Stock (Series
B)
Common Stock
Number of Shares
Amount
Number of Shares
Par Value
Additional Paid - in
Capital
Accumulated Other
Comprehensive (Loss) Income
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
Loss on currency translation
-
-
-
-
-
(29,890
)
-
(29,890
)
Stock-based compensation
-
-
-
-
29,891
-
-
29,891
Net income
-
-
-
-
-
-
153,294
153,294
Balance at March 31, 2023
49,360
$
49
39,383,459
$
39,384
$
12,359,500
$
(244,490
)
$
17,753,682
$
29,908,125
Period Ending March 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, 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
Gain on currency translation
-
-
-
-
-
79,394
-
79,394
Issuance of common stock in public
offering, net of issuance costs of $545,090
-
-
1,897,500
1,897
2,982,363
-
-
2,984,260
Net income
-
-
-
-
-
-
870,134
870,134
Balance at March 31, 2022
49,360
$
49
39,383,459
$
39,383
$
12,313,206
$
121,365
$
15,788,181
$
28,262,184
THE MARYGOLD COMPANIES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
For the Nine Month Period
Ended
March 31,
2023
2022
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income
$
832,256
$
12,476
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
436,685
424,727
Bad debt expense
1,378
3,175
Impairment of inventory value
2,698
3,478
Stock-based compensation
46,295
-
Unrealized loss (gain) on investments
76,604
(116,148
)
Loss on disposal of equipment
-
37,189
Operating lease right-of-use asset -
non-cash lease cost
432,089
494,375
Decrease (increase) in current assets:
Accounts receivable, net
(143,455
)
57,416
Accounts receivable - related party
485,715
(308,514
)
Prepaid income taxes and tax
receivable
130,860
43,440
Inventories
(187,849
)
(341,966
)
Other current assets
(437,582
)
(551,815
)
(Decrease) increase in current
liabilities:
Accounts payable, accrued expenses and
legal settlement
(382,048
)
(979,332
)
Operating lease liabilities
(433,306
)
(500,857
)
Expense waivers - related party
(41,229
)
(51,891
)
Net cash provided by (used in) operating
activities
819,111
(1,774,247
)
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of property, plant and
equipment
(73,982
)
(5,224
)
Purchase consideration payable
(616,180
)
-
Proceeds from sale of investments
4,276,765
506,492
Purchase of investments
(7,983,971
)
(1,501,980
)
Net cash (used in) investing
activities
(4,397,368
)
(1,000,712
)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Repayment of property and equipment
loans
(10,737
)
(11,159
)
Principal payments of finance lease
liability
(5,573
)
(4,167
)
Payment of issuance cost of common
stock
-
(545,090
)
Proceeds from issuance of common stock,
net of underwriter discounts
-
3,529,350
Net cash (used in) provided by financing
activities
(16,310
)
2,968,934
Effect of exchange rate change on cash and
cash equivalents
(58,588
)
(86,305
)
NET (DECREASE) INCREASE IN CASH, CASH
EQUIVALENTS AND RESTRICTED CASH
(3,653,155
)
107,670
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, BEGINNING BALANCE
13,928,899
16,086,944
CASH, CASH EQUIVALENTS AND RESTRICTED
CASH, ENDING BALANCE
$
10,275,744
$
16,194,614
Cash and cash equivalents
9,858,277
15,181,335
Restricted cash
417,467
1,013,279
Total cash, cash equivalents and
restricted cash shown in statement of cash flows
$
10,275,744
$
16,194,614
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Cash paid during the period for:
Interest paid
$
11,687
$
12,264
Income taxes paid, net
$
195,439
$
833,901
NON CASH INVESTING AND FINANCING
ACTIVITIES:
Fair value of warrants of common stock
issued to underwriters
$
-
$
132,000
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/20230515005798/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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