AMRK A Mark Precious Metals Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 06, 2024

 

 

A-MARK PRECIOUS METALS, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-36347	11-2464169
(State or Other Jurisdiction of Incorporation or organization)			(Commission File Number)	(IRS Employer Identification No.)
2121 Rosecrans Ave, Suite 6300
El Segundo, California				90245
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (310) 587-1477

 

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 par value		AMRK		Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02. Results of Operations and Financial Condition.

On November 6, 2024, A-Mark Precious Metals, Inc. (the “Company”) issued a press release regarding the Company’s financial results for its fiscal first quarter ended September 30, 2024. A copy of the Company’s press release is attached hereto as Exhibit 99.1.

The information contained in this Item 2.02 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits:

Exhibit		Description
99.1		Press Release issued by A-Mark Precious Metals, Inc., dated November 6, 2024.
104		Inline XBRL for the cover page of this Current Report on Form 8-K.

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

			A-MARK PRECIOUS METALS, INC.
Date:	November 7, 2024	By:	/s/ Carol Meltzer
		Name: Title:	Carol Meltzer General Counsel and Secretary

 

 

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Exhibit 99.1

 

A-Mark Precious Metals Reports Fiscal First Quarter 2025 Results

Diluted Earnings per Share of $0.37

 

Company Reaffirms Regular Quarterly Cash Dividend of $0.20 per share

$422.5MM Credit Facility Extended to September 2026

 

El Segundo, CA – November 6, 2024 – A-Mark Precious Metals, Inc. (NASDAQ: AMRK), a leading fully integrated precious metals platform, reported results for the fiscal first quarter ended September 30, 2024.

 

Management Commentary

 

“Our first quarter results reflect the continued strength of our fully-integrated platform,” said A-Mark CEO Greg Roberts. “Despite slower market conditions marked by elevated precious metals prices and subdued demand, we delivered $0.37 per diluted share and generated $17.8 million in non-GAAP EBITDA.

"We also took significant steps this quarter to continue to position the business for long-term success. We amended our $422.5 million Trading Credit Facility, extending its maturity date to September 30, 2026, providing the company with stable, long term access to capital for the business. We also made significant progress on our A-Mark Global Logistics (AMGL) facility expansion and logistics automation initiatives. The expected completion in the coming months is anticipated to increase operational capacity and produce efficiencies and long term cost savings. We are also advancing our reach in Asia and have made substantial progress towards establishing a trading office and DTC presence in Singapore and broadening our reach into the surrounding region.

“As noted in our recent press release, during October, Silver Towne Mint acquired all of the assets of Regency Mint Manufacturing, LLC, including its minting equipment and its customer list, further enhancing our minting capacity and expanding our customer base. We are pleased with our recent accomplishments and remain optimistic that our proven integrated business model will allow us to sustain profitability. We remain committed to exploring opportunities that enhance our market reach and deliver value to our shareholders over the long term.”

 

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		Three Months Ended September 30,
		2024					2023
		(in thousands, except Earnings per Share)
Selected Key Financial Statement Metrics:
Revenues		$	2,715,096				$	2,484,618
Gross profit		$	43,443				$	49,405
Depreciation and amortization expense		$	(4,709	)			$	(2,792	)
Net income attributable to the Company		$	8,984				$	18,827
Earnings per Share:
Basic		$	0.39				$	0.81
Diluted		$	0.37				$	0.77
Non-GAAP Measures (1):
Adjusted net income before provision for income taxes		$	14,784				$	26,779
EBITDA		$	17,782				$	30,448
(1) See Reconciliation of U.S. GAAP to Non-GAAP Measures below and on pages 17-18

 

 

A reconciliation of net income before provision for income taxes to adjusted net income before provision for income taxes for the three months ended September 30, 2024 and 2023 follows (in thousands):
		Three Months Ended September 30,
		2024					2023
Net income before provision for income taxes		$	10,173				$	23,935
Adjustments:
Contingent consideration fair value adjustments			(150	)				—
Acquisition costs			52					52
Amortization of acquired intangibles			3,864					2,165
Depreciation expense			845					627
Adjusted net income before provision for income taxes (non-GAAP)		$	14,784				$	26,779

 

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		Three Months Ended
		September 30, 2024					June 30, 2024
		(in thousands, except Earnings per Share)
Selected Key Financial Statement Metrics:
Revenues		$	2,715,096				$	2,524,955
Gross profit		$	43,443				$	42,971
Depreciation and amortization expense		$	(4,709	)			$	(2,845	)
Net income attributable to the Company		$	8,984				$	30,940
Earnings per Share:
Basic		$	0.39				$	1.35
Diluted		$	0.37				$	1.29
Non-GAAP Measures (1):
Adjusted net income before provision for income taxes		$	14,784				$	20,144
EBITDA		$	17,782				$	38,380
(1) See Reconciliation of U.S. GAAP to Non-GAAP Measures below and on pages 17-18

 

A reconciliation of net income before provision for income taxes to adjusted net income before provision for income taxes for the three months ended September 30, 2024 and June 30, 2024 follows (in thousands):
		Three Months Ended
		September 30, 2024					June 30, 2024
Net income before provision for income taxes		$	10,173				$	33,975
Adjustments:
Remeasurement gain on pre-existing equity interest			—					(16,669	)
Contingent consideration fair value adjustments			(150	)				(370	)
Acquisition costs			52					363
Amortization of acquired intangibles			3,864					2,066
Depreciation expense			845					779
Adjusted net income before provision for income taxes (non-GAAP)		$	14,784				$	20,144

 

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Fiscal First Quarter 2025 Financial Highlights

 

 

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		Three Months Ended September 30,
		2024					2023
Selected Operating and Financial Metrics:
Gold ounces sold (1)			398,000					495,000
Silver ounces sold (2)			20,449,000					30,378,000
Number of secured loans at period end (3)			562					803
Secured loans receivable at period end		$	101,887,000				$	99,167,000
Direct-to-Consumer ("DTC") number of new customers (4)			55,300					39,100
Direct-to-Consumer number of active customers (5)			129,900					106,400
Direct-to-Consumer number of total customers (6)			3,122,100					2,387,400
Direct-to-Consumer average order value ("AOV") (7)		$	2,967				$	2,440
JM Bullion ("JMB") average order value (8)		$	2,198				$	2,239
CyberMetals number of new customers (9)			1,500					2,400
CyberMetals number of active customers (10)			1,700					2,500
CyberMetals number of total customers (11)			31,100					24,800
CyberMetals customer assets under management at period end (12)		$	8,300,000				$	6,000,000
(1) Gold ounces sold represents the ounces of gold product sold and delivered to the customer during the period, excluding ounces of gold recorded on forward contracts. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(2) Silver ounces sold represents the ounces of silver product sold and delivered to the customer during the period, excluding ounces of silver recorded on forward contracts. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(3) Number of outstanding secured loans to customers that are primarily collateralized by precious metals at the end of the period.
(4) DTC number of new customers represents the number of customers that have registered or set up a new account or made a purchase for the first time during the period within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(5) DTC number of active customers represents the number of customers that have made a purchase during any month during the period within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(6) DTC number of total customers represents the aggregate number of customers that have registered or set up an account or have made a purchase in the past within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(7) DTC AOV represents the average dollar value of product orders (excluding accumulation program orders) delivered to the customer during the period within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(8) JMB AOV represents the average dollar value of product orders delivered to JMB's customers during the period.
(9) CyberMetals number of new customers represents the number of customers that have registered or set up a new account or have made a purchase for the first time during the period on the CyberMetals platform.
(10) CyberMetals number of active customers represents the number of customers that have made a purchase during any month during the period from the CyberMetals platform.
(11) CyberMetals number of total customers represents the aggregate number of customers that have registered or set up an account or have made a purchase in the past from the CyberMetals platform.
(12) CyberMetals customer assets under management represents the total value of assets managed by the Company on behalf of CyberMetals customers.

 

 

 

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		Three Months Ended
		September 30, 2024					June 30, 2024
Selected Operating and Financial Metrics:
Gold ounces sold (1)			398,000					448,000
Silver ounces sold (2)			20,449,000					25,421,000
Number of secured loans at period end (3)			562					588
Secured loans receivable at period end		$	101,887,000				$	113,067,000
Direct-to-Consumer ("DTC") number of new customers (4)			55,300					570,300
Direct-to-Consumer number of active customers (5)			129,900					114,600
Direct-to-Consumer number of total customers (6)			3,122,100					3,066,800
Direct-to-Consumer average order value ("AOV") (7)		$	2,967				$	2,890
JM Bullion ("JMB") average order value (8)		$	2,198				$	2,639
CyberMetals number of new customers (9)			1,500					1,500
CyberMetals number of active customers (10)			1,700					1,900
CyberMetals number of total customers (11)			31,100					29,600
CyberMetals customer assets under management at period end (12)		$	8,300,000				$	7,300,000
(1) Gold ounces sold represents the ounces of gold product sold and delivered to the customer during the period, excluding ounces of gold recorded on forward contracts. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(2) Silver ounces sold represents the ounces of silver product sold and delivered to the customer during the period, excluding ounces of silver recorded on forward contracts. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(3) Number of outstanding secured loans to customers that are primarily collateralized by precious metals at the end of the period.
(4) DTC number of new customers represents the number of customers that have registered or set up a new account or made a purchase for the first time during the period within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(5) DTC number of active customers represents the number of customers that have made a purchase during any month during the period within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(6) DTC number of total customers represents the aggregate number of customers that have registered or set up an account or have made a purchase in the past within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(7) DTC AOV represents the average dollar value of product orders (excluding accumulation program orders) delivered to the customer during the period within the Direct-to-Consumer segment. SGB's metrics are included after the Company acquired a controlling interest on June 21, 2024.
(8) JMB AOV represents the average dollar value of product orders delivered to JMB's customers during the period.
(9) CyberMetals number of new customers represents the number of customers that have registered or set up a new account or have made a purchase for the first time during the period on the CyberMetals platform.
(10) CyberMetals number of active customers represents the number of customers that have made a purchase during any month during the period from the CyberMetals platform.
(11) CyberMetals number of total customers represents the aggregate number of customers that have registered or set up an account or have made a purchase in the past from the CyberMetals platform.
(12) CyberMetals customer assets under management represents the total value of assets managed by the Company on behalf of CyberMetals customers.

 

 

Fiscal First Quarter 2025 Operational Highlights

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Fiscal First Quarter 2025 Financial Summary

Revenues increased 9% to $2.72 billion from $2.48 billion in the same year-ago quarter. Excluding an increase of $217.4 million of forward sales, our revenues increased $13.1 million, or 0.9%, which was due to higher average selling prices of gold and silver, partially offset by a decrease in gold and silver ounces sold.

The Direct-to-Consumer segment contributed 18% and 13% of the consolidated revenue in the fiscal first quarters of 2025 and 2024, respectively. JMB’s revenue represented 11% of the consolidated revenues for the fiscal first quarter of 2025 compared with 12% for the prior year fiscal first quarter.

Gross profit decreased 12% to $43.4 million (1.60% of revenue) from $49.4 million (1.99% of revenue) in the same year-ago quarter. The decrease in gross profit was due to lower gross profits earned from the Wholesale Sales & Ancillary Services segment, partially offset by an increase in gross profits earned by the Direct-to-Consumer segment. The Direct-to-Consumer segment contributed 54% and 43% of the consolidated gross profit in the fiscal first quarters of 2025 and 2024, respectively. Gross profit contributed by JMB represented 37% of the consolidated gross profit in the fiscal first quarter of 2025 and 36% of the consolidated gross profit for the prior year fiscal first quarter.

Selling, general and administrative expenses increased 22% to $26.6 million from $21.8 million in the same year-ago quarter. The change was primarily due to an increase in compensation expense (including performance-based accruals) of $2.6 million, higher advertising costs of $0.7 million, an increase in consulting and professional fees of $0.2 million, an increase in information technology costs of $0.2 million, and an increase in insurance costs of $0.2 million. SG&A expenses for the three months ended September 30, 2024 include $5.3 million of expenses incurred by LPM and SGB, our recently consolidated subsidiaries which were not included in our prior year Q1 results.

Depreciation and amortization expense increased 69% to $4.7 million from $2.8 million in the same year-ago quarter. The change was primarily due to an increase in amortization expense of $2.2 million relating to intangible assets acquired through our acquisition of LPM and acquisition of a controlling interest in SGB, partially offset by a decrease in JMB intangible asset amortization of $0.5 million.

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Interest income increased 16% to $7.1 million from $6.1 million in the same year-ago quarter. The increase in interest income was primarily due to an increase in other finance product income of $0.6 million and an increase in interest income earned by our Secured Lending segment of $0.3 million.

Interest expense increased 2% to $10.0 million from $9.8 million in the same year-ago quarter. The increase in interest expense was primarily due to an increase of $0.7 million associated with our Trading Credit Facility due to increased borrowings as well as an increase in interest rates and an increase of $0.7 million related to product financing arrangements, partially offset by a decrease of $1.4 million related to the AMCF Notes (including amortization of debt issuance costs) due to their repayment in December 2023.

Earnings from equity method investments decreased 79% to $0.6 million from $2.7 million in the same year-ago quarter. The decrease was due to decreased earnings of our equity method investees.

Net income attributable to the Company totaled $9.0 million or $0.37 per diluted share, compared to net income of $18.8 million or $0.77 per diluted share in the same year-ago quarter.

Adjusted net income before provision for income taxes for the three months ended September 30, 2024 totaled $14.8 million, a decrease of $12.0 million or 45% compared to $26.8 million in the same year-ago quarter. The decrease was principally due to lower net income before provision for income taxes.

EBITDA for the three months ended September 30, 2024 totaled $17.8 million, a decrease of $12.6 million or 41% compared to $30.4 million in the same year-ago quarter. The net decrease was principally due to lower net income of $10.6 million.

 

Quarterly Cash Dividend Policy

A-Mark’s Board of Directors has re-affirmed its previously announced regular quarterly cash dividend policy of $0.20 per common share ($0.80 per share on an annual basis). The Company paid a $0.20 quarterly cash dividend on October 22, 2024 to stockholders of record as of October 8, 2024. It is expected that the next quarterly dividend will be paid in January 2025. The declaration of regular cash dividends in the future is subject to the determination each quarter by the Board of Directors, based on a number of factors, including the Company’s financial performance, available cash resources, cash requirements, alternative uses of cash and applicable bank covenants.

Conference Call

A-Mark will hold a conference call today (November 6, 2024) to discuss these financial results. A-Mark management will host the call at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) followed by a question-and-answer period. To participate, please call the conference telephone number 10 minutes before the start time and ask for the A-Mark Precious Metals conference call.

Webcast: https://www.webcaster4.com/Webcast/Page/2867/51425

U.S. dial-in number: 1-888-506-0062

International number: 1-973-528-0011

Participant Access Code: 577563

The call will also be broadcast live and available for replay on the Investor Relations section of A-Mark’s website at ir.amark.com. If you have any difficulty connecting with the conference call or webcast, please contact A-Mark’s investor relations team at 1-949-574-3860.

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A replay of the call will be available after 7:30 p.m. Eastern time through November 20, 2024.

Toll-free replay number: 1-877-481-4010

International replay number: 1-919-882-2331

Participant Access Code: 51425

 

About A-Mark Precious Metals

Founded in 1965, A-Mark Precious Metals, Inc. is a leading fully integrated precious metals platform that offers an array of gold, silver, platinum, palladium, and copper bullion, numismatic coins, and related products to wholesale and retail customers via a portfolio of channels. The company conducts its operations through three complementary segments: Wholesale Sales & Ancillary Services, Direct-to-Consumer, and Secured Lending. The company’s global customer base spans sovereign and private mints, manufacturers and fabricators, refiners, dealers, financial institutions, industrial users, investors, collectors, e-commerce customers, and other retail customers.

A-Mark’s Wholesale Sales & Ancillary Services segment distributes and purchases precious metal products from sovereign and private mints. As a U.S. Mint-authorized purchaser of gold, silver, and platinum coins since 1986, A-Mark purchases bullion products directly from the U.S. Mint for sale to customers. A-Mark also has longstanding distributorships with other sovereign mints, including Australia, Austria, Canada, China, Mexico, South Africa, and the United Kingdom. The company sells more than 200 different products to e-commerce retailers, coin and bullion dealers, financial institutions, brokerages, and collectors. In addition, A-Mark sells precious metal products to industrial users, including metal refiners, manufacturers, and electronic fabricators.

A-Mark’s consolidated subsidiary, LPM Group Limited (LPM), is one of Asia’s largest precious metals dealers. LPM operates a consumer-facing showroom in Hong Kong’s Central Financial District, and offers a wide selection of products to its wholesale customers through its 24/7 online trading platform, including recently released silver coins, gold bullion, certified coins, and the latest collectible numismatic issues.

Through its A-M Global Logistics subsidiary, A-Mark provides its customers with a range of complementary services, including managed storage options for precious metals as well as receiving, handling, inventorying, processing, packaging, and shipping of precious metals and coins on a secure basis. A-Mark’s mint operations, which are conducted through its wholly owned subsidiary Silver Towne Mint, enable the company to offer customers a wide range of proprietary coin and bar offerings and, during periods of market volatility when the availability of silver bullion from sovereign mints is often product constrained, preferred product access.

A-Mark’s Direct-to-Consumer segment operates as an omni-channel retailer of precious metals, providing access to a multitude of products through its wholly owned subsidiaries, JM Bullion and Goldline. JMB owns and operates numerous websites targeting specific niches within the precious metals retail market, including JMBullion.com, ProvidentMetals.com, Silver.com, CyberMetals.com, GoldPrice.org, SilverPrice.org, BGASC.com, BullionMax.com, and Gold.com. Goldline markets precious metals directly to the investor community through various channels, including television, radio, and telephonic sales efforts. A-Mark is the majority owner of Silver Gold Bull, a leading online precious metals retailer in Canada, and also holds minority ownership interests in three additional direct-to-consumer brands.

The company operates its Secured Lending segment through its wholly owned subsidiary, Collateral Finance Corporation (CFC). Founded in 2005, CFC is a California licensed finance lender that originates and acquires loans secured by bullion and numismatic coins. Its customers include coin and precious metal dealers, investors, and collectors.

A-Mark is headquartered in El Segundo, CA and has additional offices and facilities in the neighboring Los Angeles area as well as in Dallas, TX, Las Vegas, NV, Winchester, IN, Vienna, Austria, and Hong Kong. For more information, visit www.amark.com.

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A-Mark periodically provides information for investors on its corporate website, www.amark.com, and its investor relations website, ir.amark.com. This includes press releases and other information about financial performance, reports filed or furnished with the SEC, information on corporate governance, and investor presentations.

Important Cautions Regarding Forward-Looking Statements

 

Statements in this press release that relate to future plans, objectives, expectations, performance, events and the like are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. These include statements regarding expectations with respect to future profitability and growth, international expansion, operational enhancements, and the amount or timing of any future dividends. Future events, risks and uncertainties, individually or in the aggregate, could cause actual results or circumstances to differ materially from those expressed or implied in these statements. Factors that could cause actual results to differ include the following: the failure to execute the Company’s growth strategy, including the inability to identify suitable or available acquisition or investment opportunities; greater than anticipated costs incurred to execute this strategy; government regulations that might impede growth, particularly in Asia; the inability to successfully integrate recently acquired businesses; changes in the current international political climate, which historically has favorably contributed to demand and volatility in the precious metals markets but also has posed certain risks and uncertainties for the Company, particularly in recent periods; potential adverse effects of the current problems in the national and global supply chains; increased competition for the Company’s higher margin services, which could depress pricing; the failure of the Company’s business model to respond to changes in the market environment as anticipated; changes in consumer demand and preferences for precious metal products generally; potential negative effects that inflationary pressure may have on our business; the inability of the Company to expand capacity at Silver Towne Mint; the failure of our investee companies to maintain, or address the preferences of, their customer bases; general risks of doing business in the commodity markets; and the strategic, business, economic, financial, political and governmental risks and other Risk Factors described in in the Company’s public filings with the Securities and Exchange Commission.

The Company undertakes no obligation to publicly update or revise any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements.

 

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Use and Reconciliation of Non-GAAP Measures

 

In addition to presenting the Company’s financial results determined in accordance with U.S. GAAP, management believes the following non-GAAP measures are useful in evaluating the Company’s operating performance: “adjusted net income before provision for income taxes” and “earnings before interest, taxes, depreciation and amortization” (“EBITDA”). Management believes the “adjusted net income before provision for income taxes” non-GAAP financial performance measure assists investors and analysts by facilitating comparison of period-to-period operational performance on a consistent basis by excluding items that management does not believe are indicative of the Company’s core operating performance. The items excluded from this financial measure may have a material impact on the Company’s financial results. Certain of those items are non-recurring, while others are non-cash in nature. Management believes the EBITDA non-GAAP liquidity measure assists investors and analysts by facilitating comparison of our business operations before investing activities, interest, and income taxes with other publicly traded companies. Non-GAAP measures do not have standardized definitions and should be considered in addition to, and not as a substitute for or superior to, the comparable measures prepared in accordance with U.S. GAAP, and should be read in conjunction with the financial statements included in the Company’s Quarterly Report on Form 10-Q to be filed with the SEC. Management encourages investors and others to review the Company’s financial information in its entirety and not to rely on any single financial or liquidity measure.

In the Company’s reconciliation from its reported U.S. GAAP “net income before provision for income taxes” to its non-GAAP “adjusted net income before provision for income taxes”, the Company eliminates the impact of the following five amounts: acquisition expenses; amortization expenses related to intangible assets acquired; depreciation expense; remeasurement gains or losses; and contingent consideration fair value adjustments. The Company’s reconciliations from its reported U.S. GAAP “net income before provision for income taxes” to its non-GAAP “adjusted net income before provision for income taxes”, and “net income” and “net cash provided by (used in) operating activities” to its non-GAAP “EBITDA” are provided below and are also included in the Company’s Quarterly Report on Form 10-Q to be filed with the SEC for the quarterly period ended September 30, 2024.

Company Contact:

 

Steve Reiner, Executive Vice President, Capital Markets & Investor Relations

A-Mark Precious Metals, Inc.

1-310-587-1410

sreiner@amark.com

Investor Relations Contact:

 

Matt Glover or Greg Bradbury

Gateway Group, Inc.

1-949-574-3860

AMRK@gateway-grp.com

 

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A-MARK PRECIOUS METALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except for share data)

 

		September 30, 2024				June 30, 2024
		(unaudited)
ASSETS
Current assets
Cash		$	46,924			$	48,636
Receivables, net			71,831				36,596
Derivative assets			108,721				114,720
Secured loans receivable			101,887				113,067
Precious metals held under financing arrangements			27,354				22,066
Inventories:
Inventories			735,555				579,400
Restricted inventories			541,744				517,744
			1,277,299				1,097,144
Income tax receivable			2,338				1,562
Prepaid expenses and other assets			9,188				8,412
Total current assets			1,645,542				1,442,203
Operating lease right of use assets			8,990				9,543
Property, plant, and equipment, net			20,008				20,263
Goodwill			199,937				199,937
Intangibles, net			97,807				101,663
Long-term investments			51,005				50,458
Other long-term assets			5,728				3,753
Total assets		$	2,029,017			$	1,827,820
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Liabilities on borrowed metals			39,487				31,993
Product financing arrangements			541,744				517,744
Accounts payable and other payables			10,712				18,831
Deferred revenue and other advances			327,556				263,286
Derivative liabilities			46,045				26,751
Accrued liabilities			17,378				16,798
Notes payable			6,694				8,367
Total current liabilities			989,616				883,770
Lines of credit			337,000				245,000
Notes payable			3,994				3,994
Deferred tax liabilities			22,293				22,187
Other liabilities			11,397				11,013
Total liabilities			1,364,300				1,165,964
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.01 par value, authorized 10,000,000 shares; issued and outstanding: none as of September 30, 2024 or June 30, 2024			—				—
Common stock, par value $0.01; 40,000,000 shares authorized; 24,196,095 and 23,965,427 shares issued and 23,184,059 and 22,953,391 shares outstanding as of September 30, 2024 and June 30, 2024, respectively			242				240
Treasury stock, 1,012,036 and 1,012,036 shares at cost as of September 30, 2024 and June 30, 2024, respectively			(28,277	)			(28,277	)
Additional paid-in capital			172,372				168,771
Accumulated other comprehensive income			167				61
Retained earnings			466,556				466,838
Total A-Mark Precious Metals, Inc. stockholders’ equity			611,060				607,633
Noncontrolling interests			53,657				54,223
Total stockholders’ equity			664,717				661,856
Total liabilities and stockholders’ equity		$	2,029,017			$	1,827,820

 

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A-MARK PRECIOUS METALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except for share and per share data; unaudited)

 

		Three Months Ended September 30,
		2024				2023
Revenues		$	2,715,096			$	2,484,618
Cost of sales			2,671,653				2,435,213
Gross profit			43,443				49,405
Selling, general, and administrative expenses			(26,617	)			(21,845	)
Depreciation and amortization expense			(4,709	)			(2,792	)
Interest income			7,087				6,102
Interest expense			(9,987	)			(9,823	)
Earnings from equity method investments			578				2,709
Other income, net			200				273
Unrealized gains (losses) on foreign exchange			178				(94	)
Net income before provision for income taxes			10,173				23,935
Income tax expense			(1,755	)			(4,952	)
Net income			8,418				18,983
Net (loss) income attributable to noncontrolling interests			(566	)			156
Net income attributable to the Company		$	8,984			$	18,827
Basic and diluted net income per share attributable    to A-Mark Precious Metals, Inc.:
Basic		$	0.39			$	0.81
Diluted		$	0.37			$	0.77
Weighted-average shares outstanding:
Basic			23,028,600				23,364,700
Diluted			23,979,500				24,532,600

 

 

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A-MARK PRECIOUS METALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands; unaudited)

 

		Three Months Ended September 30,
		2024				2023
Cash flows from operating activities:
Net income		$	8,418			$	18,983
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization			4,709				2,792
Amortization of loan cost			665				522
Share-based compensation			320				664
Earnings from equity method investments			(578	)			(2,709	)
Dividends and distributions received from equity method investees			169				269
Other			1,085				344
Changes in assets and liabilities:
Receivables, net			(35,235	)			928
Secured loans made to affiliates			(4,816	)			—
Derivative assets			5,999				(9,692	)
Income tax receivable			(776	)			—
Precious metals held under financing arrangements			(5,288	)			6,251
Inventories			(180,155	)			(19,166	)
Prepaid expenses and other assets			(987	)			(878	)
Accounts payable and other payables			(8,119	)			(16,665	)
Deferred revenue and other advances			64,270				(30,194	)
Derivative liabilities			19,294				12,341
Liabilities on borrowed metals			7,494				85
Accrued liabilities			(3,998	)			(10,686	)
Income tax payable			—				2,549
Net cash used in operating activities			(127,529	)			(44,262	)
Cash flows from investing activities:
Capital expenditures for property, plant, and equipment			(607	)			(1,886	)
Secured loans receivable, net			16,001				1,458
Other			87				—
Net cash provided by (used in) investing activities			15,481				(428	)
Cash flows from financing activities:
Product financing arrangements, net			24,000				53,784
Dividends paid			(4,633	)			(28,034	)
Borrowings under lines of credit			542,000				584,000
Repayments under lines of credit			(450,000	)			(549,000	)
Repayments on notes payable to related party			(1,672	)			(257	)
Repurchases of common stock			—				(4,904	)
Debt funding issuance costs			(2,640	)			(2,625	)
Proceeds from the exercise of share-based awards			3,281				960
Payments for tax withholding related to net settlement of share-based awards			—				(307	)
Net cash provided by financing activities			110,336				53,617
Net (decrease) increase in cash			(1,712	)			8,927
Cash, beginning of period			48,636				39,318
Cash, end of period		$	46,924			$	48,245

 

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Overview of Results of Operations for the Three Months Ended September 30, 2024 and 2023

Consolidated Results of Operations

The operating results for the three months ended September 30, 2024 and 2023 were as follows (in thousands, except per share data):

 

Three Months Ended September 30,		2024										2023										Change
		$					% of revenue					$					% of revenue					$					%
Revenues		$	2,715,096					100.000	%			$	2,484,618					100.000	%			$	230,478					9.3	%
Gross profit			43,443					1.600	%				49,405					1.988	%			$	(5,962	)				(12.1	%)
Selling, general, and administrative expenses			(26,617	)				(0.980	%)				(21,845	)				(0.879	%)			$	4,772					21.8	%
Depreciation and amortization expense			(4,709	)				(0.173	%)				(2,792	)				(0.112	%)			$	1,917					68.7	%
Interest income			7,087					0.261	%				6,102					0.246	%			$	985					16.1	%
Interest expense			(9,987	)				(0.368	%)				(9,823	)				(0.395	%)			$	164					1.7	%
Earnings from equity method investments			578					0.021	%				2,709					0.109	%			$	(2,131	)				(78.7	%)
Other income, net			200					0.007	%				273					0.011	%			$	(73	)				(26.7	%)
Unrealized gains (losses) on foreign exchange			178					0.007	%				(94	)				(0.004	%)			$	272					289.4	%
Net income before provision for income taxes			10,173					0.375	%				23,935					0.963	%			$	(13,762	)				(57.5	%)
Income tax expense			(1,755	)				(0.065	%)				(4,952	)				(0.199	%)			$	(3,197	)				(64.6	%)
Net income			8,418					0.310	%				18,983					0.764	%			$	(10,565	)				(55.7	%)
Net (loss) income attributable to noncontrolling interests			(566	)				(0.021	%)				156					0.006	%			$	(722	)				(462.8	%)
Net income attributable to the Company		$	8,984					0.331	%			$	18,827					0.758	%			$	(9,843	)				(52.3	%)
Basic and diluted net income per share attributable to  A-Mark Precious Metals, Inc.:
Per Share Data:
Basic		$	0.39									$	0.81									$	(0.42	)				(51.9	%)
Diluted		$	0.37									$	0.77									$	(0.40	)				(51.9	%)

 

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Overview of Results of Operations for the Three Months Ended September 30, 2024 and June 30, 2024

Consolidated Results of Operations

 

The operating results for the three months ended September 30, 2024 and June 30, 2024 were as follows (in thousands, except per share data):

 

Three Months Ended		September 30, 2024								June 30, 2024								Change
		$				% of revenue				$				% of revenue				$				%
Revenues		$	2,715,096				100.000	%		$	2,524,955				100.000	%		$	190,141				7.5	%
Gross profit			43,443				1.600	%			42,971				1.702	%		$	472				1.1	%
Selling, general, and administrative expenses			(26,617	)			(0.980	%)			(22,705	)			(0.899	%)		$	3,912				17.2	%
Depreciation and amortization expense			(4,709	)			(0.173	%)			(2,845	)			(0.113	%)		$	1,864				65.5	%
Interest income			7,087				0.261	%			8,073				0.320	%		$	(986	)			(12.2	%)
Interest expense			(9,987	)			(0.368	%)			(9,633	)			(0.382	%)		$	354				3.7	%
Earnings from equity method investments			578				0.021	%			764				0.030	%		$	(186	)			(24.3	%)
Other income, net			200				0.007	%			466				0.018	%		$	(266	)			(57.1	%)
Remeasurement gain on pre-existing equity interest			—				—	%			16,669				0.660	%		$	(16,669	)			(100.0	%)
Unrealized gains on foreign exchange			178				0.007	%			215				0.009	%		$	(37	)			(17.2	%)
Net income before provision for income taxes			10,173				0.375	%			33,975				1.346	%		$	(23,802	)			(70.1	%)
Income tax expense			(1,755	)			(0.065	%)			(3,040	)			(0.120	%)		$	(1,285	)			(42.3	%)
Net income			8,418				0.310	%			30,935				1.225	%		$	(22,517	)			(72.8	%)
Net loss attributable to noncontrolling interests			(566	)			(0.021	%)			(5	)			(0.000	%)		$	561				11,220.0	%
Net income attributable to the Company		$	8,984				0.331	%		$	30,940				1.225	%		$	(21,956	)			(71.0	%)
Basic and diluted net income per share attributable to    A-Mark Precious Metals, Inc.:
Per Share Data:
Basic		$	0.39							$	1.35							$	(0.96	)			(71.1	%)
Diluted		$	0.37							$	1.29							$	(0.92	)			(71.3	%)

 

 

 

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Reconciliation of U.S. GAAP to Non-GAAP Measures for the Three Months Ended September 30, 2024 and 2023

 

A reconciliation of net income before provision for income taxes to adjusted net income before provision for income taxes for the three months ended September 30, 2024 and 2023 follows (in thousands):

 

Three Months Ended September 30,		2024				2023				Change
		$				$				$					%
Net income before provision for income taxes		$	10,173			$	23,935			$	(13,762	)				(57.5	%)
Adjustments:
Contingent consideration fair value adjustment			(150	)			—			$	150					—	%
Acquisition costs			52				52			$	—					—	%
Amortization of acquired intangibles			3,864				2,165			$	1,699					78.5	%
Depreciation expense			845				627			$	218					34.8	%
Adjusted net income before provision for income taxes (non-GAAP)		$	14,784			$	26,779			$	(11,995	)				(44.8	%)

 

A reconciliation of net income to EBITDA, and operating cash flows to EBITDA for the three months ended September 30, 2024 and 2023 follows (in thousands):

 

Three Months Ended September 30,		2024				2023				Change
		$				$				$				%
Net income		$	8,418			$	18,983			$	(10,565	)			(55.7	%)
Adjustments:
Interest income			(7,087	)			(6,102	)		$	985				16.1	%
Interest expense			9,987				9,823			$	164				1.7	%
Amortization of acquired intangibles			3,864				2,165			$	1,699				78.5	%
Depreciation expense			845				627			$	218				34.8	%
Income tax expense			1,755				4,952			$	(3,197	)			(64.6	%)
			9,364				11,465			$	(2,101	)			(18.3	%)
Earnings before interest, taxes, depreciation, and amortization (non-GAAP)		$	17,782			$	30,448			$	(12,666	)			(41.6	%)
Reconciliation of Operating Cash Flows to EBITDA:
Net cash used in operating activities		$	(127,529	)		$	(44,262	)		$	83,267				188.1	%
Changes in operating working capital			142,317				65,127			$	77,190				118.5	%
Interest expense			9,987				9,823			$	164				1.7	%
Interest income			(7,087	)			(6,102	)		$	985				16.1	%
Income tax expense			1,755				4,952			$	(3,197	)			(64.6	%)
Dividends and distributions received from equity method investees			(169	)			(269	)		$	(100	)			(37.2	%)
Earnings from equity method investments			578				2,709			$	(2,131	)			(78.7	%)
Share-based compensation			(320	)			(664	)		$	(344	)			(51.8	%)
Amortization of loan cost			(665	)			(522	)		$	143				27.4	%
Other			(1,085	)			(344	)		$	741				215.4	%
Earnings before interest, taxes, depreciation, and amortization (non-GAAP)		$	17,782			$	30,448			$	(12,666	)			(41.6	%)

 

 

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Reconciliation of U.S. GAAP to Non-GAAP Measures for the Three Months Ended September 30, 2024 and June 30, 2024

 

A reconciliation of net income before provision for income taxes to adjusted net income before provision for income taxes for the three months ended September 30, 2024 and June 30, 2024 follows (in thousands):

 

Three Months Ended		September 30, 2024				June 30, 2024					Change
		$				$					$					%
Net income before provision for income taxes		$	10,173				33,975				$	(23,802	)				(70.1	%)
Adjustments:
Remeasurement gain on pre-existing equity interest			—				(16,669	)			$	16,669					100.0	%
Contingent consideration fair value adjustments			(150	)			(370	)			$	(220	)				(59.5	%)
Acquisition costs			52				363				$	(311	)				(85.7	%)
Amortization of acquired intangibles			3,864				2,066				$	1,798					87.0	%
Depreciation expense			845				779				$	66					8.5	%
Adjusted net income before provision for income taxes (non-GAAP)		$	14,784			$	20,144				$	(5,360	)				(26.6	%)

 

A reconciliation of net income to EBITDA, and operating cash flows to EBITDA for the three months ended September 30, 2024 and June 30, 2024 follows (in thousands):

 

Three Months Ended		September 30, 2024					June 30, 2024					Change
		$					$					$					%
Net income		$	8,418				$	30,935				$	(22,517	)				(72.8	%)
Adjustments:
Interest income			(7,087	)				(8,073	)			$	(986	)				(12.2	%)
Interest expense			9,987					9,633				$	354					3.7	%
Amortization of acquired intangibles			3,864					2,066				$	1,798					87.0	%
Depreciation expense			845					779				$	66					8.5	%
Income tax expense			1,755					3,040				$	(1,285	)				(42.3	%)
			9,364					7,445				$	1,919					25.8	%
Earnings before interest, taxes, depreciation, and amortization (non-GAAP)		$	17,782				$	38,380				$	(20,598	)				(53.7	%)
Reconciliation of Operating Cash Flows to EBITDA:
Net cash (used in) provided by operating activities		$	(127,529	)			$	82,850				$	(210,379	)				(253.9	%)
Changes in operating working capital			142,317					(68,064	)			$	210,381					309.1	%
Interest expense			9,987					9,633				$	354					3.7	%
Interest income			(7,087	)				(8,073	)			$	(986	)				(12.2	%)
Income tax expense			1,755					3,040				$	(1,285	)				(42.3	%)
Dividends received from equity method investees			(169	)				(281	)			$	(112	)				(39.9	%)
Earnings from equity method investments			578					764				$	(186	)				(24.3	%)
Remeasurement gain on pre-existing equity interest			—					16,669				$	(16,669	)				(100.0	%)
Share-based compensation			(320	)				(321	)			$	(1	)				(0.3	%)
Deferred income taxes			—					2,690				$	(2,690	)				(100.0	%)
Amortization of loan cost			(665	)				(619	)			$	46					7.4	%
Other			(1,085	)				92				$	(1,177	)				(1,279.3	%)
Earnings before interest, taxes, depreciation, and amortization (non-GAAP)		$	17,782				$	38,380				$	(20,598	)				(53.7	%)

 

 

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v3.24.3

Document And Entity Information	Nov. 06, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 06, 2024
Entity Registrant Name	A-Mark Precious Metals, Inc.
Entity Central Index Key	0001591588
Entity Emerging Growth Company	false
Entity File Number	001-36347
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	11-2464169
Entity Address, Address Line One	2121 Rosecrans Ave, Suite 6300
Entity Address, City or Town	El Segundo
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90245
City Area Code	(310)
Local Phone Number	587-1477
Entity Information, Former Legal or Registered Name	Not Applicable
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	AMRK
Security Exchange Name	NASDAQ

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