U.S. Global Investors, Inc. (NASDAQ: GROW) (the “Company”), a
registered investment advisory firm with longstanding experience in
global markets and specialized sectors from gold mining to emerging
markets, today reported operating income of $730,000 for the
quarter ended March 31, 2023, on total revenues of $3.6 million.
The Company recorded net income of $1.6 million, or $0.11 per
share, representing an 89% increase over the previous quarter’s net
income.
Average assets under management (AUM) for the three-month period
ended March 31, 2023, were $2.5 billion, while total AUM at
period-end was $2.3 billion.
“As a reminder, we were delayed in submitting our financial
results for the quarters ended December 31, 2022, and March 31,
2022, due to prior period restatements. The restatement process
took longer than expected, but now that the March 2023 quarter
results have been filed, we expect to be back on track reporting
quarterly and annual financial statements in a timely manner,” says
Frank Holmes, the Company’s CEO and Chief Investment Officer. “We
remained profitable in the first calendar quarter of 2023 as key
industries that we track ended the period in positive territory,
from gold to airlines to luxury goods. Our Global Luxury Goods Fund
(USLUX) performed well during the quarter, led by strong advances
by Tesla, the fund’s number one holding. In the March quarter,
Tesla’s Model Y was the world’s best-selling vehicle, the first
time a purely electric automobile took the top spot.1 Shares of
European-listed luxury goods manufacturers and retailers also moved
higher on hopes that China’s economic reopening following pandemic
lockdowns would increase sales. In April, giant luxury conglomerate
LVMH became Europe’s most valuable company when its market cap
exceeded $500 billion, the first European company to do so.2 In
all, I believe we’re very well-positioned for future growth as
inflation continues to cool.”
Air Travel Volumes Have Returned to Pre-Pandemic
Levels
The Company’s largest fund, the U.S. Global Jets ETF (JETS),
ended the first calendar quarter on a strong footing as the number
of commercial air passengers continued to increase heading into the
busy summer travel season. On June 16, the U.S. Transportation
Security Administration (TSA) reported that it screened over 2.78
million people at airports, which is the most since 2019, before
the pandemic.3
“Leisure travel has already fully recovered to pre-pandemic
levels, and there are now estimates that business travel won’t be
too far behind,” continues Mr. Holmes. “Based on ticketing data
analyzed by ForwardKeys, a travel intelligence and consultancy
firm, global business travel is set to overtake leisure in July,
and the gap may widen in the autumn and beyond.4 I believe this is
bullish for the airline industry, and JETS in particular, since
business travel has historically been a more lucrative source of
revenue than leisure.
“As you may have read in the Investor Alert and Frank Talk, we
believe the airline industry is a leading indicator of economic
activity, the implication being that the overall economy is robust,
despite the negative headlines. Airfares remain near the high end,
and yet some airlines have reported record advance bookings for
summer travel.5 I have been traveling quite a bit lately, and every
airport is packed and nearly every flight is operating at full
capacity.”
Healthy Liquidity and Capital Resources
As of March 31, 2023, the Company had net working capital of
approximately $36.9 million, an increase of $3.0 million, or 8.7%,
since June 30, 2022. Total assets, including various corporate
investments, stood at $55.7 million. With approximately $24.9
million in cash and cash equivalents, an increase of $2.6 million,
or 11.8% since June 30, 2022, the Company has adequate liquidity to
meet its current obligations.
Substantial Increase in Share Repurchases While
Maintaining Monthly Dividend Policy
For the three months ended March 31, 2023, the Company
repurchased 193,040 class A shares at a net cost of $556,000, a
substantial increase from the 19,487 shares that were repurchased
during the same period a year earlier.
The Company believes that its stock is undervalued, making the
buybacks an attractive opportunity on flat or down days in
anticipation of a potential rebound. The repurchase program has
been in place since December 2012, and the Board of Directors (the
“Board”) has renewed the repurchase program each calendar year.
The Company is also pleased to announce that it will continue
its payment of monthly dividends. The Board approved payment of the
$0.0075 per share per month dividend beginning in July 2023 and
continuing through September 2023. The record dates are July 10,
August 14 and September 11, and the payment dates will be July 24,
August 28 and September 25.
At the June 20, 2023, closing price of $2.75, the $0.0075
monthly dividend equals a 3.27% yield on an annualized basis.
The continuation of future cash dividends will be determined by
the Board, at its sole discretion, after review of the Company's
financial performance and other factors, and is dependent on
earnings, operations, capital requirements, general financial
condition of the Company and general business conditions.
Selected Financial Data (unaudited):
(dollars in thousands, except per share
data)
|
Three months ended |
|
03/31/2023 |
|
03/31/2022 |
|
Operating Revenues |
$3,624 |
|
$6,175 |
|
Operating Expenses |
2,894 |
|
3,658 |
|
Operating Income |
730 |
|
2,517 |
|
|
|
|
|
Total Other Income (Loss) |
1,216 |
|
(3,609 |
) |
Income (Loss) Before Income Taxes |
1,946 |
|
(1,092 |
) |
|
|
|
|
Income Tax Expense (Benefit) |
306 |
|
(246 |
) |
Net Income (Loss) |
$1,640 |
|
$(846 |
) |
|
|
|
|
Net income (loss) per share (basic and diluted) |
$0.11 |
|
$(0.06 |
) |
|
|
|
|
Avg. common shares outstanding (basic) |
14,747,537 |
|
15,010,630 |
|
Avg. common shares outstanding (diluted) |
14,747,637 |
|
15,011,582 |
|
|
|
|
|
Avg. assets under management (billions) |
$2.5 |
|
$4.1 |
|
About U.S. Global Investors, Inc.The story of
U.S. Global Investors goes back more than 50 years when it began as
an investment club. Today, U.S. Global Investors, Inc.
(www.usfunds.com) is a registered investment adviser that focuses
on niche markets around the world. Headquartered in San Antonio,
Texas, the Company provides investment management and other
services to U.S. Global Investors Funds and U.S. Global ETFs.
Forward-Looking Statements and DisclosureThis
news release and other statements by U.S. Global Investors may
include certain “forward-looking statements,” including statements
relating to revenues, expenses and expectations regarding market
conditions. You can identify these forward-looking statements by
the use of words such as “outlook,” “believes,” “expects,”
“potential,” “opportunity,” “seeks,” “anticipates” or other
comparable words. Such statements involve certain risks and
uncertainties and should be read with corporate filings and other
important information on the Company’s website, www.usfunds.com, or
the Securities and Exchange Commission’s website at
www.sec.gov.
These filings, such as the Company’s annual report and Form
10-Q, should be read in conjunction with the other cautionary
statements that are included in this release. Future events could
differ materially from those anticipated in such statements and
there can be no assurance that such statements will prove accurate
and actual results may vary. The Company undertakes no obligation
to publicly update or review any forward-looking statements,
whether as a result of new information, future developments or
otherwise.
Shares of any ETF are bought and sold at market price (not NAV),
may trade at a discount or premium to NAV and are not individually
redeemed from the funds. Brokerage commissions will reduce returns.
Stock markets can be volatile and share prices can fluctuate in
response to sector-related and other risks as described in the fund
prospectus. Foreign and emerging market investing involves special
risks such as currency fluctuation and less public disclosure, as
well as economic and political risk. Companies in the consumer
discretionary sector are subject to risks associated with
fluctuations in the performance of domestic and international
economies, interest rate changes, increased competition and
consumer confidence.
All opinions expressed and data provided are subject to change
without notice. Some of these opinions may not be appropriate to
every investor.
________________________1 Munoz, J. F. (2023, May 25). Tesla
Model Y Was The World’s Best-Selling Car In Q1
2023. Motor1.com.2 Reid, J. (2023, April 25). Luxury goods
giant LVMH becomes the first European company to surpass $500
billion in market value. CNBC.3 Shepardson, D. (2023, June
20). U.S. screens highest number of air passengers since
2019. Reuters. 4 Adriana. (2023). Business travel set to
overtake leisure. ForwardKeys.5 Bomey, N. (2023, April 13).
Delta reports record advance bookings as summer travel season
approaches. Axios.
Contact:Holly SchoenfeldtDirector of
Marketing 210.308.1268hschoenfeldt@usfunds.com
US Global Investors (NASDAQ:GROW)
Historical Stock Chart
From Aug 2024 to Sep 2024
US Global Investors (NASDAQ:GROW)
Historical Stock Chart
From Sep 2023 to Sep 2024