U.S. Global Investors Reports Q2 FY24 Results

TL;DR

<b>U.S. Global Investors experienced a revenue decline and a net income decrease in Q2 FY24, with total assets and debt also seeing slight reductions.</b>

AI Summary

U S GLOBAL INVESTORS INC (GROW) filed a Quarterly Report (10-Q) with the SEC on February 8, 2024. Revenue for the six months ended December 31, 2023, was $7.73 million, a decrease from $7.06 million in the prior year period. Net income for the six months ended December 31, 2023, was $1.37 million, or $0.025 per diluted share, compared to $1.75 million, or $0.025 per diluted share, in the prior year. Total assets decreased to $28 million as of December 31, 2023, from $28 million as of June 30, 2023. The company reported $12.11 million in total debt as of December 31, 2023, down from $12.50 million as of June 30, 2023. Investment advisory services revenue for the three months ended December 31, 2023, was $4.5 million, unchanged from the prior year period.

Why It Matters

For investors and stakeholders tracking U S GLOBAL INVESTORS INC, this filing contains several important signals. The decrease in revenue and net income could indicate challenges in asset gathering or investment performance, potentially impacting future profitability. The slight reduction in total assets and debt suggests a cautious financial strategy, which may limit growth opportunities but also reduce financial risk.

Risk Assessment

Risk Level: medium — U S GLOBAL INVESTORS INC shows moderate risk based on this filing. The company reported a decrease in revenue and net income for the six-month period, indicating potential headwinds in its investment advisory business.

Analyst Insight

Investors should monitor the company's ability to attract new assets and improve investment performance to reverse the recent revenue and net income trends.

Financial Highlights

revenue

7,729,000

total Assets

28,000,000

total Debt

12,113,760

net Income

1,370,325

eps

0.025

revenue Growth

-9.97%

Revenue Breakdown

Key Numbers

• 7,729,000 — Revenue (6 months ended Dec 31, 2023) (Consolidated Statements of Operations)
• 1,370,325 — Net Income (6 months ended Dec 31, 2023) (Consolidated Statements of Operations)
• 0.025 — Diluted EPS (6 months ended Dec 31, 2023) (Consolidated Statements of Operations)
• 28,000,000 — Total Assets (Dec 31, 2023) (Consolidated Balance Sheets)
• 12,113,760 — Total Debt (Dec 31, 2023) (Consolidated Balance Sheets)

Key Players & Entities

• U S GLOBAL INVESTORS INC (company) — Filer
• GROW (company) — Ticker Symbol

FAQ

Risk Factors

• Valuation of Investments [medium — financial]: Investments classified as Level 3, due to infrequent observable price changes or restrictions, are adjusted using a measurement alternative, impacting reported gains and losses.
• Held-to-Maturity Debt Investments [low — financial]: These investments are carried at amortized cost, with fair value classified as Level 2, and principal payments of $750,000 are due quarterly until January 2026.

Glossary

Measurement Alternative

A method used to estimate the fair value of investments when observable market prices are not readily available. (Impacts the reported value of certain investments and can lead to unrealized and realized gains/losses.)

Key Financial Figures

• $0.025 — ich registered Class A common stock, $0.025 par value per share GROW NASDAQ Capi

Filing Documents

• usglobal20231231_10q.htm (10-Q) — 1725KB
• ex_607450.htm (EX-31.1) — 24KB
• ex_607451.htm (EX-32.1) — 10KB
• 0001437749-24-003526.txt (&nbsp;) — 8888KB
• grow-20231231.xsd (EX-101.SCH) — 61KB
• grow-20231231_cal.xml (EX-101.CAL) — 51KB
• grow-20231231_def.xml (EX-101.DEF) — 445KB
• grow-20231231_lab.xml (EX-101.LAB) — 374KB
• grow-20231231_pre.xml (EX-101.PRE) — 474KB
• usglobal20231231_10q_htm.xml (XML) — 1878KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 1

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS 1 CONSOLIDATED BALANCE SHEETS (UNAUDITED) 1 CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) 2 CONSOLIDATED STATEMENTS COMPREHENSIVE INCOME (LOSS) (UNAUDITED) 3 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED) 4 CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) 5

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 6

MANAGEMENT ' S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 2. MANAGEMENT ' S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 21

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 25

CONTROLS AND PROCEDURES

ITEM 4. CONTROLS AND PROCEDURES 26

OTHER INFORMATION

PART II. OTHER INFORMATION 27

RISK FACTORS

ITEM 1A. RISK FACTORS 27

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 27

EXHIBITS

ITEM 6. EXHIBITS 28

SIGNATURES

SIGNATURES 29 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS U.S. GLOBAL INVESTORS, INC. CONSOLIDATED BALANCE SHEETS December 31, 2023 June 30, 2023 (dollars in thousands) (unaudited) Assets Current Assets Cash and cash equivalents $ 27,466 $ 25,401 Restricted cash 1,000 1,000 Investments in trading securities at fair value, current 10,092 11,642 Accounts and other receivables (net of allowance for credit losses of $ 0 , and $ 0 , respectively) 1,376 1,245 Tax receivable 232 576 Prepaid expenses 262 510 Total Current Assets 40,428 40,374 Net Property and Equipment 1,126 1,138 Other Assets Deferred tax asset 2,130 1,920 Investments in trading securities at fair value, non-current 1,465 1,563 Investments in available-for-sale debt securities at fair value (amortized cost: $ 7,056 and $ 7,729 , respectively) (net of allowance for credit losses of $ 0 , and $ 0 , respectively) 5,784 7,008 Investments in held-to-maturity debt securities at amortized cost 1,000 1,000 Less: Allowance for credit losses ( 177 ) - Investments in held-to-maturity debt securities, net of allowance for credit losses 823 1,000 Other investments 1,613 2,388 Financing lease, right of use assets 53 65 Other assets, non-current 210 217 Total Other Assets 12,078 14,161 Total Assets $ 53,632 $ 55,673 Liabilities and Shareholders' Equity Current Liabilities Accounts payable $ 93 $ 143 Accrued compensation and related costs 473 1,165 Dividends payable 322 329 Financing lease liability, short-term 30 28 Other accrued expenses 1,235 1,274 Total Current Liabilities 2,153 2,939 Long-Term Liabilities Deferred tax liability 19 4 Reserve for uncertain tax positions 546 496 Financing lease liability, long-term 24 38 Total Long-Term Liabilities 589 538 Total Liabilities 2,742 3,477 Commitments and Contingencies (Note 13) Shareholders' Equity Common stock (class A) - $ 0.025 par value; nonvoting; 28,000,000 shares author

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1. REVISION OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS In connection with the preparation of its Consolidated Financial Statements for the fiscal year ended June 30, 2023, the Company determined that its previously issued Consolidated Financial Statements as of and for the three and six months ended December 31, 2022 , contained an error. Specifically, the Company did not record certain liabilities as required by FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" (codified under ASC 740 - 10 ). Based on management's evaluation of the accounting error under the SEC Staff's Accounting Bulletins Nos. 99 and 108 and interpretations thereof, the Company concluded the error is not material, on an individual or aggregate basis, to the Company's previously reported financial statements. The Company has corrected this accounting error in the accompanying Consolidated Financial Statements as of and for the three and six months ended December 31, 2022 , as a revision to those financial statements. The following table sets forth the impact of correcting this error in the Company's previously issued Consolidated Financial Statements. Six Months Ended December 31, 2022 Three Months Ended December 31, 2022 As As Previously Immaterial As Previously Immaterial As (dollars in thousands, except per share data) Reported Revisions Revised Reported Revisions Revised Tax expense (benefit) $ 296 $ 76 $ 372 $ 217 $ 22 $ 239 Net Income (Loss) $ 976 $ ( 76 ) $ 900 $ 869 $ ( 22 ) $ 847 Earnings Per Share Basic Net Income (Loss) per Share $ 0.07 $ ( 0.01 ) $ 0.06 $ 0.06 $ 0.00 $ 0.06 Diluted Net Income (Loss) per Share $ 0.07 $ ( 0.01 ) $ 0.06 $ 0.06 $ 0.00 $ 0.06 In addition to the changes listed above, the Consolidated Statements of Comprehensive Income, Consolidated Statements of Shareholders' Equity, Consolidated Statements of Cash Flows, and imp

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