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
airlines, today reported operating revenues of $2.6 million in the
quarter ended March 31, 2024. Net income was mostly flat as the
Company saw a decrease in advisory fees, lower investment income
and lower assets under management (AUM) compared to the previous
quarter and the same quarter a year earlier.
For the three-month period ended March 31, 2024, average AUM was
$1.8 billion, while AUM as of March 31, 2024, were $1.7
billion.
The Company’s shareholder yield at the end of the period was
8.32%,1 which exceeded the yields on the five-year and 10-year
Treasury. This represents the Board of Directors’ commitment to
returning value to shareholders through a combination of monthly
dividends and share repurchases.
“We consider GROW a deep-value stock, especially with the
Federal Reserve keeping rates higher for longer,” says Frank
Holmes, the Company’s CEO and Chief Investment Officer. “Higher
borrowing costs affect companies of all sizes, but they put
substantial pressure on small and microcap stocks, which are
generally more sensitive to economic shifts and smaller financial
cushions.”
Quarterly Share Repurchases
The Company repurchased a total of 211,282 of its own shares
during the quarter ended March 31, 2024, at a net cost of
approximately $577,000. This marks a 9.4% increase from the same
period a year earlier and represents the most shares that the
Company has bought back in a single quarter in the past few
years.
London-Listed JETS Merges with TRIP, Increasing AUM
Fivefold
As was covered in a previous press release,2 the Company
announced that its Europe-domiciled airlines ETF, the U.S. Global
Jets UCITS ETF (JETS), merged into the Travel UCITS ETF (TRIP),
effective April 19, 2024. This move is expected to increase JETS’
AUM fivefold, providing a larger base to grow assets and further
solidifying the Company’s position as a leader in thematic
investing.
“We’re pleased and extremely excited about the recent merger of
our smart beta 2.0 JETS ETF, listed on the London Stock Exchange,
into TRIP,” says Mr. Holmes. “TRIP presents a unique opportunity
for the company to increase assets from around $5 million to $20
million. We’re confident that our expertise in the quantamental
investment space has unlocked new avenues for shareholders, both
domestically and internationally, as evidenced in this merger.”
The Company maintains its bullishness on the travel industry as
airline executives predict that a record number of passengers will
fly this summer.3 Checkpoint volumes provided by the Transportation
Security Administration (TSA) are off to a record start in 2024,
with carriers in the U.S. handling an average of 2.26 million
passengers each day, a 5.6% increase over the same period in 2019,
before the pandemic.
GOAU Responding Well to ATH Gold Prices as Central Bank
Demand Perseveres
The price of gold recently hit a record high on geopolitical
uncertainty and fears that persistently sticky inflation will
convince the Federal Reserve to keep rates higher for longer. The
metal traded above $2,400 per ounce for the first time ever on
Friday, April 12. Meanwhile, the first quarter of 2024 saw central
banks purchase a net 290 tons of gold, a record amount for the
start to a year.4
“Gold’s recent surge isn’t just a U.S. dollar story. The
precious metal is also making historic breakouts in various
currencies around the world, from the Japanese yen to the Chinese
yuan and Indian rupee,” says Mr. Holmes. “This global phenomenon
underscores gold’s broad appeal as a store of value and a means of
preserving purchasing power. It’s also constructive for our U.S.
Global GO GOLD and Precious Metal Miners ETF (NYSE: GOAU), which
takes a quantitative approach to picking gold mining stocks. We’re
happy to see that the smart-beta 2.0 ETF has been performing as
expected with gold near all-time highs.”
Healthy Liquidity and Capital Resources
As of March 31, 2024, the Company had net working capital of
approximately $38.6 million, an increase of $1.2 million from June
30, 2023. With approximately $27.5 million in cash and cash
equivalents, plus investments in our funds and other securities,
the Company has adequate liquidity to meet its current
obligations.
Tune In to the Earnings
Webcast
The Company has scheduled a webcast for 7:30 a.m. Central time
on Friday, May 10, 2024, to discuss the Company’s key financial
results for the quarter. Frank Holmes will be accompanied on the
webcast by Lisa Callicotte, chief financial officer, and Holly
Schoenfeldt, marketing and public relations manager. Click
here to register for the earnings webcast or visit
www.usfunds.com for more information.
Selected Financial Data (unaudited):
(dollars in thousands, except per share
data)
|
Three months ended |
|
3/31/2024 |
3/31/2023 |
Operating Revenues |
$ |
2,593 |
|
$ |
3,624 |
Operating Expenses |
|
3,081 |
|
|
2,894 |
Operating Income (Loss) |
|
(488 |
) |
|
730 |
|
|
|
Total Other Income |
|
528 |
|
|
1,216 |
Income Before Income
Taxes |
|
40 |
|
|
1,946 |
|
|
|
Income Tax Expense |
|
75 |
|
|
326 |
Net Income (Loss) |
$ |
(35 |
) |
$ |
1,620 |
|
|
|
Net Income Per Share (Basic
and Diluted) |
$ |
0.00 |
|
$ |
0.11 |
|
|
|
Avg. Common Shares Outstanding
(Basic) |
|
14,077,042 |
|
|
14,747,537 |
Avg. Common Shares Outstanding
(Diluted) |
|
14,077,042 |
|
|
14,747,637 |
|
|
|
Avg. Assets Under Management
(Billions) |
$ |
1.8 |
|
$ |
2.5 |
|
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 Disclosure
This 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.
Please consider carefully a fund’s investment objectives, risks,
charges and expenses. For this and other important information,
obtain a statutory and summary prospectus for JETS
here, GOAU here and for SEA here. Read it carefully
before investing.
Investing involves risk, including the possible loss of
principal. 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. Because the funds concentrate their investments in
specific industries, the funds may be subject to greater risks and
fluctuations than a portfolio representing a broader range of
industries. The funds are non-diversified, meaning they may
concentrate more of their assets in a smaller number of issuers
than diversified funds.
The funds invest in foreign securities which involve
greater volatility and political, economic and currency risks and
differences in accounting methods. These risks are greater for
investments in emerging markets. The funds may invest in the
securities of smaller-capitalization companies, which may be more
volatile than funds that invest in larger, more established
companies.
The performance of the funds may diverge from that of
the index. Because the funds may employ a representative sampling
strategy and may also invest in securities that are not included in
the index, the funds may experience tracking error to a greater
extent than funds that seek to replicate an index. The funds are
not actively managed and may be affected by a general decline in
market segments related to the index.
Airline Companies may be adversely affected by a
downturn in economic conditions that can result in decreased demand
for air travel and may also be significantly affected by changes in
fuel prices, labor relations and insurance costs. Gold, precious
metals, and precious minerals funds may be susceptible to adverse
economic, political or regulatory developments due to concentrating
in a single theme. The prices of gold, precious metals, and
precious minerals are subject to substantial price fluctuations
over short periods of time and may be affected by unpredicted
international monetary and political policies. We suggest investing
no more than 5% to 10% of your portfolio in these
sectors.
Foreign and emerging market investing involves special risks
such as currency fluctuation and less public disclosure, as well as
economic and political risk. By investing in a specific geographic
region, such as China and/or Taiwan, a regional ETFs returns and
share price may be more volatile than those of a less concentrated
portfolio.
Fund holdings and allocations are subject to change at any time.
Click to view fund holdings for JETS and GOAU.
Distributed by Quasar Distributors, LLC. U.S. Global Investors
is the investment adviser to JETS and GOAU.
The Russell Microcap Index measures the performance of the
microcap segment of the U.S. equity market. It makes up less than
3% of the U.S. equity market.
_____________________________
1 The Company calculates shareholder yield by adding the
percentage of change in shares outstanding to the dividend yield
for the 12 months ending March 31, 2024. The Company did not have
debt; therefore, no debt reduction was included.
2 U.S. Global Investors announces merger of Europe-Domiciled
Airlines ETF into the Travel UCITS ETF (TRIP), expanding and
diversifying investment opportunities in global travel industry.
USGI. (2024, April 23).
https://www.usfunds.com/resource/u-s-global-investors-announces-merger-of-europe-domiciled-airlines-etf-into-the-travel-ucits-etf-trip-expanding-and-diversifying-investment-opportunities-in-global-travel-industry/
3 Josephs, L. (2024, April 18). Airline executives predict a
record summer and even more demand for First class. CNBC.
https://www.cnbc.com/2024/04/17/airline-execs-predict-record-summer-even-more-demand-for-first-class.html
4 Gold demand trends Q1 2024. World Gold Council. (2024, April
30).
https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-q1-2024
Contact:Holly SchoenfeldtDirector of
Marketing210.308.1268hschoenfeldt@usfunds.com
Photos accompanying this announcement are available
at:https://www.globenewswire.com/NewsRoom/AttachmentNg/af421562-6bd8-45e7-8c43-08983c981e94
https://www.globenewswire.com/NewsRoom/AttachmentNg/06b1720e-a52a-4db9-987e-637fc6b1dc91
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