Marygold Companies, Inc. (MGLD)·Q1 2025 Earnings Summary

Executive Summary

• Q1 FY2025 (quarter ended September 30, 2024): Revenue was $7.91M and diluted EPS was $(0.04), compared to $8.24M and $(0.01) in the prior-year period; sequentially vs Q4 FY2024 revenue of $8.30M and EPS of $(0.05) shows lower sales but a slightly smaller per-share loss than Q4 .
• Management reiterated continued near‑term losses tied to investments in the proprietary mobile fintech app and a YoY decline in average AUM at USCF to $3.1B, pressuring fee revenue .
• Balance sheet remained solid at quarter-end with cash of $6.67M and equity of $25.53M; total assets were $35.88M .
• No formal quantitative guidance was issued in the press materials; near‑term narrative centers on cost discipline and fintech rollout milestones rather than targets .
• Subsequent quarters (for trend context): management flagged plans to “significantly reduce expenses” at Marygold & Co. (Q2), ramp U.K. app launch (Q3), and later paused U.S. app marketing while eliminating debt via a business sale and gain (Q1 FY2026), which shape expectations for estimate revisions and stock catalysts beyond Q1 FY2025 .

What Went Well and What Went Wrong

• What Went Well

  • Expense control remained a strategic focus, with management emphasizing long‑term value creation as the company refocuses on financial services; CEO: “We are continuing to put the foundational building blocks together as we transform [the] primary focus to financial services… plan for the rollout of our mobile fintech app in the U.K.” .
  • Balance sheet resilience: Cash and cash equivalents rose to $6.67M from $5.46M at June 30, 2024; total assets increased to $35.88M; stockholders’ equity was $25.53M .
  • Diversification: Non-fintech subsidiaries (USCF, Gourmet Foods, Original Sprout, Brigadier at this time) continued to contribute revenue streams; segment detail underscores fund management and consumer products as key pillars .

• What Went Wrong

  • Revenue decline: $7.91M, down from $8.24M in Q1 FY2024 due largely to lower average AUM at USCF, weighing on management fees .
  • Increased losses YoY: Net loss widened to $(1.59)M vs $(0.50)M in Q1 FY2024 as fintech investment spending persisted .
  • Macro sensitivity: Management cited commodity price fluctuations, higher rates, and geopolitical/economic uncertainty impacting average AUM and, therefore, fund-management fees .

Financial Results

• P&L summary vs prior year and prior quarter

• Operating structure and cost context

• Segment revenue (Q1 FY2025 vs Q1 FY2024)

• KPIs and balance sheet snapshot

Sequential context beyond Q1 FY2025 (for trend analysis):

• Q2 FY2025: Revenue $8.00M; Net loss $(1.75)M; EPS $(0.04) .
• Q3 FY2025: Revenue $7.03M; Net loss $(1.01)M; EPS $(0.02) .

Guidance Changes

• No formal quantitative guidance (revenue, EPS, margins, OpEx, or tax rate) was provided in the Q1 FY2025 press materials; management framed outlook in terms of continued fintech investment and AUM sensitivity rather than numeric targets .

Earnings Call Themes & Trends

Note: No Q1 FY2025 earnings call transcript was located in the company filings/press materials.

Management Commentary

• Strategy and focus: “We are continuing to put the foundational building blocks together as we transform [the company’s] primary focus to financial services and plan for the rollout of our mobile fintech app in the U.K.” — Nicholas Gerber, CEO .
• Profitability path: “Moving into fiscal 2025, additional investments in TMC’s strategic transformation and emphasis on financial services are expected to continue to negatively impact our bottom line” — David Neibert, COO .
• Macro and AUM sensitivity: “Commodity price fluctuations and the high-interest rate environment, along with geopolitical and economic uncertainty, likely affected average AUM, which amounted to $3.1 billion for the most recent quarter vs. $3.5 billion a year ago” — David Neibert, COO .

Q&A Highlights

• Not applicable; no earnings call transcript was provided in the company’s filings/press materials for Q1 FY2025.

Estimates Context

• We were unable to retrieve S&P Global consensus estimates for Q1 FY2025 revenue and EPS; comparisons to Wall Street estimates are therefore omitted. Management did not provide quantitative guidance in press materials .

Key Takeaways for Investors

• Near‑term P&L remains investment‑led: Q1 FY2025 diluted EPS of $(0.04) reflects continued fintech spending; expect earnings volatility tied to app rollout cadence and AUM swings at USCF .
• Balance sheet flexibility: Cash of $6.67M and equity of $25.53M provide operating runway; later actions in FY2025–FY2026 (financing, cost reductions, divestiture) suggest incremental de‑risking beyond Q1 FY2025 .
• Macro lever on revenues: USCF fee revenue remains sensitive to commodity prices and rates; AUM averaged ~$3.1B in Q1 FY2025, a key KPI to monitor for top‑line trajectory .
• Execution milestones: Watch for U.K. fintech adoption KPIs, expense reductions at Marygold & Co., and any monetization of non-core assets (as executed post‑period with Brigadier) to inform the path to profitability .
• Catalysts: Cost discipline and simplification (e.g., debt elimination, pause of U.S. marketing later in FY2026 Q1) can drive sentiment and reduce cash burn risk even without explicit revenue/EPS guidance .
• Risk balance: Continued investment without near‑term revenue uplift, plus commodity volatility impacting USCF AUM, remain the primary downside risks to earnings power .

Appendix: Additional quarterly context (post Q1 FY2025, for trend)

• Q2 FY2025: Revenue $8.00M; EPS $(0.04); management anticipated reducing Marygold & Co. expenses; $4M note entered; equity raise steps completed later .
• Q3 FY2025: Revenue $7.03M; EPS $(0.02); U.K. app launch ramp; avg AUM down to ~$2.6B; public offering raised ~$1.8M net .
• Q1 FY2026: Revenue $7.0M; net loss $(0.36)M ($(0.01)/sh); $0.5M gain on sale of Brigadier; debt retired; avg AUM ~$2.9B; USCF profitable .