The Marygold Companies Reports Financial Results for 2024 First Fiscal Quarter

SAN CLEMENTE, Calif.--(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, 2023			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 Ended September 30, 2023			Three Months Ended September 30, 2022
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 Ended September 30, 2023			Three Months Ended September 30, 2022
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 September 30, 2023	Preferred Stock (Series B)				Common Stock				Additional		Accumulated Other						Total
	Number of Shares		Amount		Number of Shares		Par Value		Paid – in Capital		Comprehensive (Loss)			Retained Earnings			Stockholders’ Equity
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 September 30, 2022	Preferred Stock (Series B)				Common Stock				Additional		Accumulated Other					Total
	Number of Shares		Amount		Number of Shares		Par Value		Paid – in Capital		Comprehensive (Loss)			Retained Earnings		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

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.