U.S. Global Investors Q2 2025 Earnings Report

U.S. Global Investors EPS Results

• Actual EPS: -$0.01
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

U.S. Global Investors Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

U.S. Global Investors Announcement Details

• Quarter: Q2 2025
• Date: 2/12/2025
• Time: After Market Closes
• Conference Call Date: Thursday, February 13, 2025
• Conference Call Time: 8:30AM ET

U.S. Global Investors (NASDAQ:GROW) is a publicly owned investment manager. It primarily provides its services to investment companies. The firm is a large advisory firm, an investment adviser to an investment company which provides portfolio management for investment companies. The firm manages and launches equity/balanced funds, fixed income funds and other funds. It also manages hedge funds. The firm primarily invests in no-load mutual funds and exchange traded funds (ETFs). U.S. Global Investors, Inc. is based in San Antonio, Texas.

U.S. Global Investors Q2 2025 Earnings Call Transcript

Presentation

[Operator]

You have joined the meeting as an attendee and will be muted throughout the meeting.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

As seen on Slide number two, the presenters for today's program are Frank Holmes, U. S. Global Investors' CEO and Chief Investment Officer Lisa Callicott, Chief Financial Officer and myself, Holly Schoenfeld, Director of Marketing. On Slide number three, during this webcast, we may make forward looking statements about our relative business outlook. Any forward looking statements and all other statements made during this webcast that don't pertain to historical facts are subject to risks and uncertainties that may materially affect actual results.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Please refer to our press release and corresponding Form 10 Q filing for more detail on factors that could cause actual results to differ materially from any described today and in forward looking statements. Any such statements are made as of today and U. S. Global accepts no obligation to update them in the future. On Slide number four, as always to our loyal shareholders, we invite you to email us at infousfunds dot com and we would love to send you one of our hats seen here.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

So just shoot us a message with your mailing address and we're happy to get you some USGI swag. All right. Now on Slide number five, I will briefly review our company. U. S.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Global Investors is an innovative investment manager with vast experience in global markets and specialized sectors. We are well known for expertise in gold and precious metals, commodities, the global travel industry and luxury goods. The company was originally founded as an investment club becoming a registered investment advisor in 1968. The company has a long standing history of global investing and launching first of their kind investment products, including the first no load gold fund. Finally, we are pioneers in SmartBeta two point zero thematic products.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Our investment team combines stock picking and portfolio construction to develop new products with thousands of hours of backtesting and fine tuning on a quarterly basis. Moving on to slide number six. This is a graphic we always like to begin our presentations with, the DNA of volatility. It acts as a reminder to investors about how various asset classes, especially the ones that we invest in, can move up or down over time. And this is where I want to hand the presentation over to CEO and CIO, Frank Holmes, to dive in a little more on this and give us a macro overview of the last quarter.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Frank?

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Thank you, Moholy, and welcome, shareholders, and thank you for your loyalty and support. And I was looking forward going into the details of the presentation and a recap of where I can give you more granularity with Lisa Caldicott, our CFO, I'm going to go through and start the sort of basic disclosure on volatility because volatility is so important to understand in capital markets. And each asset class and each stock has its own DNA of volatility. As you can see here the S and P and what that means is one Sigma means that it's a non event 68% or 70% of the time we rounded off for the market to go up or down 1% of the time and over ten days is 3%. Gold is about the same as the S and P 500.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And I can share with you that twenty five years ago, it was always substantially greater than daily volatility, the ten day volatility of $1,000,000,000 in the S and P. But now they're one. And Grow itself used to have a much higher daily volatility and they used to trade off of the crypto. And before that, they used to trade the volatility off the gold funds because they were so big and our investments in the creation of Hyve Digital and owning a big share position seemed to really tweak the volatility. And then it came along with Jets and Jets grew.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So it's important to see what assets our investments are. They drive the revenue and they also drive that volatility. The Dow Jones asset managers index is the same as the S and P, but over ten days it's more as plus or minus 4% and oil on a daily basis is much more volatile and jets as you can see is very strongly correlated with price of oil and that's because oil is our biggest line item for costs. So falling oil prices last year was extremely bullish for the airlines industry and most analysts basically had a negative cautious cautious throughout the whole year and the ETF was up 30 some odd percent. And certain airlines we own like United, it was up 130%.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So it's recognizing this DNA of volatility and what moves grow up and down. I'm happy to share with you that growth volatility over ten days is less than the Dow Jones Asset Managers Index and that's probably because of our total shareholder yield and that is the amount of stock buying back that we're doing especially in the down days. Next please. I want to thank the long term investors, in particular, Peric Capital who are experts in microcap stocks, the great fund group. And then Vanguard, this shows up in their index of asset management in microcap stocks.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. So I'm the CEO and the Chief Investment Officer, and I have about 19% of all our shares outstanding and I have approximately 99% of the Bodie Control. And the voting control is really a structure to protect investors, the fund investors, so that if there is a change of control of the investment advisor, all the fund shareholders have to know. And so that basically says that if Gro's shares trade more than 25% of shareholders in the course of a particular year, that you'd always be setting up proxy to the fund shareholders. So it was always structured that I would have the voting control or a family trust has the voting control like we have, say, with Franklin Funds.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. Strategy and tactics. Our strategy is to create thematic products that are sustainable and this is using the Smart Beta two point zero strategy. This requires rigorous backtesting and ongoing detailed analysis of data graphs. When you pull the data up every quarter, there's always glitches in the data pool.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And so you do have the sort of active way of looking at these particular products. And it does show itself that it's a very systematic way of running money, managing money, especially in thematic products. And I'm happy to say that when we've gone to create these products up against an index, over time they have shown other performance. At U. S.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Global Investors, our mission is to make people feel financially happy and secure. Their wealth is consistently growing. And that really comes into our investors. We have two types. We have a trader that comes in and out on technical factors.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And then we have a person as an asset allocator that buys our particular products. Strategically buyback stock as a company, we believe we're deeply undervalued and we have a disciplined algorithm for flattened down days. We manage to preserve cash for future growth opportunities and market corrections. We're always looking at M and A activity to acquire fund assets and grow our subscriber base and followers is really important from a marketing point of view because you can put a net present value on the number of followers you have. In YouTube, you have 1,000,000 followers, you can get revenue sharing, which can be up to $1,000,000 a year.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So that is a very important part metric for marketing is to show how the subscriber base is growing and it's been growing over the past year. Next please. So a big part is this sort of Board of Directors and the hardest part was to go out and actually find someone that had detailed experience of running the capital markets, understands what they call mutual funds and ETFs are under what they call the 40 Act, right, Act for Investment Advisors written in 1940. But a public company is, as those rules and regulations are called the SEC three thousand three hundred and thirty four Act. So it's really a challenge to find someone that has that tacit knowledge and that exquisite knowledge of managing a business in both of those highly regulatory rulemaking.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And so Bobby Duncan, I reached out to and he said, sure, I'd like to come back and be a Director at this time, not an executive, but he has lots of executive experience over seventeen years at U. S. Global. He was a CFO, he was a Chief Operating Officer, he was a CEO and he understands on this regulatory world we live in and the importance of the different departments. So it's a great addition to the team.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. So I'll try to explain the stock and the stock has had these incredible runs and surges and the last time we had this huge surge going in 2020, '20 '20 '1 was a combination of our high position being trading on big end shares and going up exponentially along with the growth in Jets. Jets ETF went from $40,000,000 in assets to a peak of $4,000,000,000 in assets. It was an incredible run. All those Reddit investors and people that follow on Twitter followers that trade these stocks.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

It's interesting that Warren Buffett capitulating got out of all the airlines in the first second quarter of twenty twenty with the COVID scare. And whereas millennials, they were coming in buying the stock and the stock went from 10 to 28 fell back to '28, '20 '19, now we're up to 25 again. So I think that our stock price is now highly correlated to the airline industry. But what we've shown here since 2019 before COVID, how the Russell Microcap Index is done and how is it grown done on a relative basis. So touch wood, we have over performed that overall index over a long period of time.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. Macro trend, the gap narrows between active and passive ETFs. This is very important for technical aspects of launching ETFs that they wanted to have, the people who are putting up the capital to see these ideas were really were strict about that they knew what the basket always was going to be. They didn't want it active. And I think that people like Ark and Cathie Woods really changed that landscape of active ETFs of more growing.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And we're pretty happy about it as though we launched our first Smart Beta two point zero, but it's an active view. But we create our own type of index and we have something to beat and track. But I think what's important here for investors is that as mutual fund redemptions continue, active ETFs are growing. And I think that this is very positive for fund groups like U. S.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Global. Next please. Warren Buffett highlights the value proposition of buying back one stock at a value accretive prices and it benefits all shareholders, not just the biggest holders. Warren Buffett celebrated his 90 birthday on August. Blowing and going, I was with one of his key executives, a program I do every year at Harvard with other CEOs.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And it's interesting, he said his brain is so sharp. He has a cane, he has to walk quickly. But his brain and the financials are following everything. I guess all that bridge playing is helping and being around very smart people. And one of those big parts of this very smart person is buying back your stock.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. So why do we buy back stock? Because the company believes the stock is undervalued and therefore buys back shares of growth when the price is flattered down from the previous trading day using an algorithm. This is part of the company's two pillar strategy to enhance shareholder value by increasing the dividend as well as the buyback because we know that any major surge in our assets would like we've seen in jets or go AU or our new one more can have a significant impact on the upside of the stock price. So if people are not betting like we are long term, that's okay.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

We continue to buy back our stock for and the long term investor gets that benefit. Next please. So for the three months ended 12/31/2024, the company repurchased a total of 236,731 Class A shares using cash of approximately $587,000 Next please. As you can see, our buyback has gone from $192,000 up to $679,000 and then in 2024, dollars '8 hundred and '7 thousand. So we have been buying back stock as the stock has drifted lower.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And I believe it's the most of that drifting takes place because the JET's ETF, even though it has done so well, people keep redeeming and I think a sentiment on negative news is driving that. But if you look at the bookings, you can there's no low there used to be a high season or low season for travel. It's all high season or very high season. The price of tickets are still if you're lucky to buy a ticket for a year out, there are no discounts. And it's just recognizing the baked in revenue.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

But Wall Street is not bullish. They're always trying something to micromanage it. I have no idea. But there's none of these analysts caught United going to be up 130% last year and the spectacular growth of the industry. So I think that this is where smart investing comes along, growth at a reasonable price and our model, our SmartBeta two point zero demonstrates that it's very, very efficient and effective for someone who wants to play.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

An industry that is really quite remarkable because every day a million people around the world go to work to make the airlines function. But when you look at the growth of all the making the airplanes, the service providers, etcetera for the airline industry is close to 9% of global GDP. So it's really interesting that this one product, thematic product on the airlines industry can capture 9% of global activity. So I think it's very exciting and we've expanded the footprint in Latin America, in Colombia and Chile, Mexico. So the idea that if the dollar is strong, then tourism going to Latin America actually will go up.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

The Americans will still be traveling more. And I think these are you can see this in the bookings of these flights. Next please. Growing dividends, the yield is the share price of $2.45 is at 3.67 percent. It's slightly under the five year government bond yield.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

But with the stock buyback, let me call it, next slide, the total shareholder yield, it's extremely attractive value proposition. And so the shareholder yield model is dividends plus buybacks and debt reduction and we have no debt. So market cap wise, it's got a very high yield. Next slide please. Five year is 4.38%, ten year is 4.58% and buying back your stock, those dollars end up generating what they call a shareholder yield of 10%.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So it's a very attractive value proposition and that's why we continue to buy. Next please. So on a relative competitive nature, looking at WisdomTree, which is 100% ETFs and looking at their profit margins, they're higher, so they end up trading at a higher price to book and the returns on their assets have grown nicely, whereas U. S. Global is down from but it's still higher than where the infamous QQQ is.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So it just gives you an idea to try to explain the relative valuation metrics. The cash dividend at Invesco is higher, but buying back the stock on the total shareholder yield is lower. And if these thematic ideas that you believe in, then which I believe in, I think that there's a huge upside potential. Next, please. Company has a steady cash flow despite challenging macro numbers.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

The company has a strong balance sheet, which includes both cash and other investments to weather these downdrafts in capital markets. The company continues to buyback stock on flattened down days and pay of must be debited. Next, please. SmartBeta two point zero investing is our fundamental investment strategy, which combines cutting edge technology with robust data analysis to help optimize returns and manage risk effective for our shareholders. We believe the use of SmartBeta two point zero factors in our thematic fund lineup sets us apart from our competition.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

We know that when the application of that for like our luxury goods fund, we're the only one with a mutual fund luxury goods and it works. That fund has done a great job of outperforming any other luxury related products that are out there. Most of them are in Europe. So we're very happy with this sort of structured discipline. The quant approach is back tested for thousands of hours over decades of data to determine the optimized portfolio construction.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And that's what makes it special. It's not just the factors for picking the stocks like low PE or low cash flow or high free cash flow yield, it's also looking for momentum year over year revenue growth, cash flow growth. These factors that when you do portfolio construction, look at various industries, you have to have a system like a FactSet that does a backtesting and it gives you a data point after looking at forty quarters or six hundred months, a statistical meaningful analysis of this product is robust and up and down the cycles and naturally past performance no guarantee of future results. But it's so far, it works. It's a much better discipline before launching an idea of a product that you have a rigorous test.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And when you hire other young people that come along and work on the CFA, it's proven to be a great way for them to learn about capital markets and application of this sort of structured discipline. Next please. So introducing U. S. Global Technology and Aerospace and Defense ETF, WAR was launched in December 30, allows it to get picked up by the Morningstars.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

But really what took place is the journey. In the journey from knowing gold, we still have to try to launch the first Bitcoin ETF because the relation between gold and Bitcoin is very high. We couldn't do that in 2017. And it took to 2024 before it became the fastest growing ETF, but we would have waited all those years. And we went out and we created the first crypto mining company to go public, Hive.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And so it's an interesting journey. You don't realize that then we get into a gold mutual fund because we learn about from mutual funds when we go into luxury goods because gold is related to luxury and 60% of gold demand is actually called a love trade. And it's really quite remarkable that you learn along these steps. And launching Hive, it's a data center business and Bitcoin mining is all about data center business. And then you realize about cybersecurity and then Hive was buying all these NVIDIA chips for its mining of Ethereum and then the AI business has been building and then you realize that the airline industry or the overlap with aero defense and all of a sudden you say there is no product out there that is really focused on the application of AI to reinvigorate our base, our military bases and what we're doing for defense and cybersecurity.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And so in that process, we find out that data centers are key. Guess what? We started this product eighteen months ago and now data centers are the big boom spend along for NVIDIA chips and aerospace companies and drone companies are all buying GPU chips from companies like NVIDIA. So we believe this is a secular trend. So this particular ETF owns semiconductors, it owns data centers, it owns cybersecurity like the Palantiras of the world and it also owns major military aerospace and defense companies.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

But we apply this discipline every quarter to recalibrate and rebalance and go back, like I said earlier, 600 or 40 to see how it did in up and down cycles. And it was pretty compelling that we this is a really a technology product, but it's for cybersecurity protection along with military. And then in that research, we had a China fund we end up shutting down, we're the first to have a China Regent Fund and it has spectacular growth. And then all of a sudden we realized that no one's really interested in China and their dictator that comes in has really been a crackdown on the technology sector and he's had a very aggressive program of building ports around the world in particular using them for military and that's woken up that America is quite concerned about China's slow and predatory practices. This also lends into war, the war ETF and it also explains why we shut down our China Region Opportunity Fund because China in their predatory practices of brilliant marketing of One Belt, One Way and helping infrastructure spending for countries in Africa and Latin America, they end up supporting rogue nations, they end up supporting authoritarian regimes, they end up supporting anything that undermines democracy.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And we can see that a lot of these countries end up going anti America or they're anti Taiwan. And so we see that the landscape has sort of changed dramatically. Next slide. There's a huge spending going to take place in the military space over the next ten years. So we think this is just a great product that for those people that are cautious of a global economy and you have to look where money is being spent full of money, military spending will continue to grow and AI will applications to all the military is only going to accelerate.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. And this is why the new Red Cold War, three good looking guys, why invest in the defense industry because of their predatory practices. South Korea has the risk if Ukraine falls at the dictator of North Korea will invade South Korea. Then the dictator of China will invade Taiwan. So these are all real events that are taking place in real time.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

There is the thought process of cutting back on spending. I can't see that for many reasons. A classic would be China that does have nothing with the Arctic and all of a sudden builds three icebreakers and they're making claims of the Arctic supercargo and they try to build a military pace location port in Greenland. And so we've seen recently President Trump talk about Greenland and Panama that is and highly related to the China fear and the predatory practices of Xi Jinping. And Xi Jinping is now supporting military material for Putin and North Korea is testing its soldiers and have sent in soldiers to work in helping Putin's army fight in Ukraine.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So we're seeing a real change around the world and so I think the technology is a key part. Next please. Especially with military. China's growing influence on Latin America. You can see many of these countries, what they do in particular in Peru, they come in and they want you to buy their telecom, their software and then they try to support authoritarian leaders.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So you just have to be really aware when you look at this, how many places they're going to locate it. Next please. The five key industries shaping the defense sector semiconductors, aerospace, data centers, cybersecurity and homeland security. Next please. Global defense spending is on a rise to $2,400,000,000,000 If you really spent the money on purchasing power parity, China is we are way behind what China is spending.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

When China goes and spends $100,000,000,000 their output is so much greater because the cost of living is so much less and what they have to pay their workers. So we do have a catch up and it was interesting seeing Japan recently rocketing up in their spend because they're cautious and worried about which China is doing in Asia. They're building islands to basically say that within 12 miles of their land, they're waterways and they're trying to take over The Philippines water rights. So that would have a big impact in Japan. So you are seeing these changes and it's good to have, I think, a product like this that is focused on military and technology.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. Jets, our biggest product continues to show record number of people flying. It's interesting to see that this year the airlines are continuing to show positive developments. And if you look at year out, you can see that there's no discount. So it's baked in high revenue growth in these stocks traded at basically one quarter of the S and P PE ratio cash flow multiples.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

So PPN are valued. Thanks, please. So JetPeat's the market. We're very, very happy about our SmartBeta two point zero. When we created it, we want to beat the New York Stock Exchange ARCA Global Airline Index.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And as you can see, it's done that by a wide margin. And last year, it also outperformed the S and P 500, which was a big thrill for us. Next please. Jeff, confused to open for the market airline index over different time period here. As you can see, since August, it's had a huge run.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

We did a webcast and it's interesting people were blah, blah and the funds just took off and then I had calls and people talking to me saying, I'm sorry we didn't listen. You nailed it. The industry has so much disclosure and bookings, as I mentioned earlier, are strong for next year. So I think the airline industry, which trades at under 10 times earnings versus the market trades over 20 times earnings is offering great growth and a reset button. Next please.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

This is Jeff's has outperformed since COVID. As you can see, This is interesting for me because if we go to the bottom of the of COVID, so COVID had its crisis, the jets fell and then the rebound has been pretty strong, pretty strong performance, especially in the past year. Now what really helps drive a lot of this is last year was the price of oil was down. So we do find a huge shareholder base of oil trading investors strategically will buy jets with inverse to the movement of oil. Oil is rising, they're out.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Oil is falling, they're in. Next please. Average annual gold price, this always shocks people, has advanced 84% of the century. That is because I believe that the G20 countries are practicing modern monetary theory, which is the value in countries' currencies all over the world, in particular the U. S.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Dollar and it lends itself that you should have this 10% weighting and rebalancing share. Next please. There's been a way of looking at it as gold is money and in various currencies, how much is gold appreciated. As you can see that in Chinese Yuan, it's appreciated 11.6% and U. S.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Dollar is 10.5% and British pound it's up 8% against the euro it's up 7% and against the Japanese yen it's up 5%. So the global theme is pretty strong that gold is rising in all countries' currencies, having a 10% weighting in this asset class is only why it's supported. Next please. Billy, you beating gold mining stocks in 2024. Next please.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

And since inception, SmartBeta two point zero has done a great job. Our other product called Sea, it was interesting I shared with you the yield is 18%. So the overall investor yield last year was positive 2.4% because the yield the dividend yield paid off was so high. Next please. So Grohez's investment in Hyve is slowly getting paid down and it pays 8% plus principal every quarter.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Next please. So Gro's approximately $2.45.1500000.0 dollars in assets, $2,200,000 quarterly operating revenue. Next please. Earnings per share, Lisa will give you more granularity, why we lost a penny. Next please.

[Frank Holmes, CEO & Chief Investment Officer at U.S. Global Investors]

Now I'm going to turn it over to hardworking Lisa Kalakau.

[Lisa Callicotte, Chief Financial Officer at U.S. Global Investors]

Thank you, Frank. Good morning. First, I'll start with our financial highlights on the next slide. As you can see, our average assets under management were $1,500,000,000 operating revenues were $2,200,000 and we did have a net loss of $86,000 On the next slide, it talks a little bit more about our earnings. So we have both operational earnings and we have investment earnings.

[Lisa Callicotte, Chief Financial Officer at U.S. Global Investors]

Both the operational earnings and our realized earnings kind of hit our cash flow where our unrealized earnings don't. But both because our operational earnings are based on our advisory services and then our investment earnings are really the realized and unrealized gains, they both are affected by stock market forces. So that's what you'll see is some of the fluctuation and volatility in our income. On the next slide, this is part of our income statement and you can see that our total revenues were $2,200,000 for the quarter, which was a decrease of $587,000 or 21% from the $2,800,000 the same quarter last year. This decrease is primarily due to a decrease in assets under management, especially in our JETS ETF.

[Lisa Callicotte, Chief Financial Officer at U.S. Global Investors]

And our operating expenses for the quarter were $2,800,000 This was an increase of $144,000 or 5% and it was mainly due to an increase in employee compensation and benefits and was partially offset by a decrease in general and administrative expenses. On the next slide, we see our operating loss for the quarter was $539,000 and it was an unfavorable change of $731,000 compared to the same period last year. Other income decreased $1,100,000 compared to the prior year, and it was mainly due to unrealized losses on equity and debt securities in the current period of $221,000 compared to unrealized gains in the prior period of $414,000 We also had realized foreign currency losses of $239,000 compared to $92,000 gains in the prior period. Net loss after taxes for the quarter was $86,000 or $0.01 per share, which was an unfavorable change of $1,300,000 compared to the net income of $1,200,000

[Lisa Callicotte, Chief Financial Officer at U.S. Global Investors]

or $0.09

[Lisa Callicotte, Chief Financial Officer at U.S. Global Investors]

per share for the same quarter and fiscal year twenty twenty four. Moving to the next slide, you can see we still have a strong balance sheet. It includes high levels of cash, which will allow us to weather through this lower asset period. Cash and cash equivalents was $26,000,000 and we had current investments of $9,700,000 On the next slide is the detail of our other assets and included in there are some other investments, which totaled $9,600,000 On the next slide, our liabilities decreased from June 2024 approximately $134,000 and we still have no long term debt. On the next slide, you see our stockholders' equity detail.

[Lisa Callicotte, Chief Financial Officer at U.S. Global Investors]

At 12/31/2024, the company had a net working capital of $38,000,000 which increased $182,000 since June 2024, and we had a current ratio of twenty:one. With that, I'll pass it over to Holly to discuss marketing and distribution initiatives.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Thank you, Lisa. On this slide, we are proud to report that we continue to provide original timely market insight through our YouTube channel. We have numerous new videos here and on our TikTok channel that we invite you to explore.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

We know one of the best ways to reach new and existing shareholders is increasingly through education, but in particular in the form of videos. So if you haven't checked out our YouTube channel yet, I highly recommend that you do so. All right. On the next slide, I want to highlight that our most popular piece is now available on our website. This is the periodic table of commodity returns for 2024 that shows exactly how various commodities fared in the prior year.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

This is an interactive feature as well as a downloadable PDF, so I encourage you to check it out on our website if you haven't done so already. And on this slide, in case you missed it, as Frank mentioned earlier in the presentation, our new Aerospace and Defense ETF, ticker symbol WAR, launched in the last quarter on December 30. And then on January 9, we hosted a webcast with Frank and it was co hosted by Lieutenant General retired John Evans, seen here, about the state of the global defense market and how war can offer a diversified way to gain exposure. So you can request a copy of the replay by sending us an email at infousfunds dot com. On the next slide, we always like to recap the most read Frank Talk blog posts during each quarter.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

As you can see here, the top themes seem to focus on gold and precious metals as gold was continuing to reach a new all time high as well as defense and cybersecurity. If you aren't a subscriber already, be sure to visit usfunds.com and sign up. It's completely free. So finally, on my last slide, I do encourage you to follow U. S.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Global across social media. We are on Twitter or X, LinkedIn, YouTube, Instagram and Facebook. So wherever you prefer to get your news, be sure to check us out. This way you're up to date with what's going on with Gro, our funds and the broader market insights. All right.

[Holly Schoenfeldt, Public Relations Leader at U.S. Global Investors]

Just as a reminder to our audience today, if you have any questions, you can email those to infousfunds dot com and we will gladly follow-up with you to get anything clarified that you may need more information on. So thank you for tuning in today. That concludes our webcast summarizing the second quarter fiscal year twenty twenty five.

Participants

Executives

• Holly Schoenfeldt, Public Relations Leader
• Frank Holmes, CEO & Chief Investment Officer
• Lisa Callicotte, Chief Financial Officer