March 1, 2024

Goldmoney Inc. Reports Financial Results for Second Quarter of Fiscal 2024 for the Period Ending in September 30, 2023


Toronto, Ontario–(Newsfile Corp. – November 7, 2023) – Goldmoney Inc. (TSX: XAU) (US: XAUMF) (“Goldmoney” or the “Company”), today announced financial results for the financial quarter ended September 30, 2023. All amounts are expressed in Canadian dollars unless otherwise noted.

Financial Highlights

  • Group Tangible Capital of $143 million, an increase of $9.7 million, or 7% Year over Year (“YoY”).

  • Group Tangible Capital per Share increased to $10.38 from $8.94, an increase of $1.44 per share, or 16% YoY.

  • Group Precious Metal Position consisting of Coins, Bullion, and Bullion Denominated Loan of $23 million, representing 21.25% of Tangible Capital Exclusive of the Mene Inc. Shareholding.

  • Gold-Adjusted Tangible Capital per 1 Goldmoney Inc. share of 0.129 grams an increase of 16% YoY.

  • Repurchased a total of 155,500 shares at an average purchase price of $8.95 during the quarter, reducing the share count by 1.1%.

  • Quarterly Operating Income of $4.2 million, a decrease of 27% YoY.

  • Net Income of $2.0 million, a decrease of 46% YoY.

  • Basic Earnings per Share of $0.15.

  • Goldmoney.com Group Client Assets of $2 billion as at September 30, 2023.

  • Menē Inc. reported results for the quarter ended June 30, 2023, generating $5 million in revenue and $1.5 million gross profit.

  • The Company announced in September 2023 that it plans to sell its wholly-owned subsidiary Schiff Gold.

IFRS Consolidated Income Statement Data (1)
($000s, except earnings per share)
FY 2024 FY 2023 FY 2022
Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3
Precious metal revenue 9,965 14,652 21,195 17,959 21,574 24,117 48,378 21,814
Investment property rental income 1,060 1,028
Interest income 676 790 703 553 369 164 99 85
Total revenue 11,702 16,470 21,898 18,512 21,943 24,280 48,477 21,899
Precious metal operating expenses 7,483 10,823 16,694 13,651 16,202 18,579 42,718 19,574
Operating income 4,218 5,647 5,204 4,862 5,741 5,701 5,759 2,324
Expenses 1,611 2,382 11,130 1,490 1,871 2,673 15,244 1,565
Other (income) expenses 671 1,270 (2,350) (6,970) 31 7,708 (2,982) (1,814)
Net income (loss) 2,009 1,995 (3,973) 10,341 3,734 (4,680) (6,611) 2,574
Non-IFRS Adjusted Gain 2,841 3,646 2,819 2,993 4,358 4,131 4,622 1,622
Basic earnings (loss) per share 0.15 0.14 (0.27) 0.69 0.25 (0.31) (0.44) 0.17

 
(1) The above table excludes SchiffGold’s operating activity to allow users to evaluate the Company based on the results of its continuing operations.
 

Statement from Roy Sebag, CEO of Goldmoney Inc.

In the second quarter of fiscal year 2024, Goldmoney Inc. produced $2.0 million in IFRS Net income and $2.84 million in Non-IFRS Adjusted Gain. This is our eighth consecutive quarter of profitability using the Non-IFRS Adjusted Gain metric which excludes non-cash items such as precious metal and FX movements as well as depreciation and stock compensation.

Our financial accounts are presented excluding Schiff Gold, which is being treated as a business held for sale that is expected to close in the current quarter. We do not expect any meaningful impact to tangible capital per share given that 212,600 shares of Goldmoney Inc. will be cancelled as part of the transaction.

Our precious metals business continued to perform well producing $2.5 million of quarterly operating income. This result was achieved despite a weak environment for precious metals over the July 1 – September 30, 2023 period. We have seen an improved environment for precious metals since quarter end and expect our precious metals business to continue delivering consistent operating income and free cash flow.

Our property investment business is becoming increasingly more important with each passing quarter. Since acquiring our first property in June, we have collected two quarterly rent payments totaling $2.1 million. Virtually all this rental income flows to the bottom line.

Since quarter end, we closed on the acquisition of Wales Millennium Centre Phase II (also known as BBC Hoddinott Hall) in Cardiff, Wales. This acquisition will increase our property rental income next quarter by circa $675,000 and circa $2.7 million on an annual basis. Notably, this income is indexed to inflation with uncapped annual rent increases.

Our property investment portfolio is currently annualizing $7.0 million of net rental income with a remaining contractual term of 12.5 years across the two properties. This recurring cash flow, which will rise each year depending on the rate of inflation, will provide the purchasing power for further property acquisitions. We remain focused on growing our property investment business in the UK with the goal of reaching $10 million of annual rental income from investment properties by the end of calendar 2024. We are also growing confident that our timing will be rewarded given that, at the time of writing, it is becoming more likely that interest rates in the UK have peaked.

At Menē, our 24-karat jewelry business, a new management team has taken the reigns. The company is currently undergoing a significant restructuring of its operations and business model. The entire Goldmoney board is supportive of these actions and has confidence in the new leadership team and their vision. Some of their actions are already making an impact. For example, we now expect that Goldmoney Inc.’s circa $10 million of precious metal loans to Menē may be fully repaid over the coming months. Menē is a company still in its infancy but on its way to becoming a globally recognized luxury brand. Consequently, we view our shareholding in Menē as a long-term investment with tremendous potential.

Goldmoney repurchased 155,000 shares or over 1.1% of the company during the quarter. Because we believe our shares to be undervalued, we are repurchasing as many shares as we are allowed. But the restrictions on NCIB’s in Canada make this task more difficult (at least to our minds when viewed relative to other countries) than it should be. Shareholders should note that the outstanding shares for Goldmoney Inc, will decline by a further 212,600 shares following the closing of the Schiff Gold sale, after which the pro-forma total shares outstanding will be circa 13,555,000.

In sum, this was another solid quarter of operating performance for Goldmoney Inc. The decisions we have taken over the course of 2023 continue to bear fruit, and we believe that our operations and control of expenses are now well positioned to build up a significant amount of capital over the medium to long-term. Once this becomes evident in our financial statements, we believe that the discount between our company’s tangible book value per share of $10.38 and our current share price of $8.40 will disappear.

Financial Information and IFRS Standards

The selected financial information included in this release is qualified in its entirety by, and should be read together with, the Company’s consolidated financial statements for the quarter and fiscal year ended March 31, 2023 and prepared in accordance with International Financial Reporting Standards (“IFRS”) and the corresponding management’s discussion and analysis, which are available under the Company’s profile on SEDAR at www.sedar.com.

Non-IFRS Measures

This news release contains non-IFRS financial measures; the Company believes that these measures provide investors with useful supplemental information about the financial performance of its business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating its business. Although management believes these financial measures are important in evaluating the Company’s performance, they are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with IFRS. These non-IFRS financial measures do not have any standardized meaning and may not be comparable with similar measures used by other companies. For certain non-IFRS financial measures, there are no directly comparable amounts under IFRS. These non-IFRS financial measures should not be viewed as alternatives to measures of financial performance determined in accordance with IFRS. Moreover, presentation of certain of these measures is provided for year-over-year comparison purposes, and investors should be cautioned that the effect of the adjustments thereto provided herein have an actual effect on the Company’s operating results.

Tangible Capital is a non-IFRS measure. This figure excludes from total shareholder equity (i) intangibles, and (ii) goodwill, and is useful to demonstrate the tangible capital employed by the business.

For a full reconciliation of non-IFRS financial measures used herein to their nearest IFRS equivalents, please see the section entitled “Reconciliation of Non-IFRS Financial Measures” in the Company’s MD&A for the quarter ended September 30, 2023.

About Goldmoney Inc.

Founded in 2001, Goldmoney (TSX: XAU) is a TSX listed company invested in the real economy. The leading custodians and traders of precious metals, Goldmoney Inc. also owns and operates businesses in jewelry manufacturing, coin retailing, and property investment. For more information about Goldmoney, visit goldmoney.com.

Media and Investor Relations inquiries:

Mark Olson
Chief Financial Officer
Goldmoney Inc.
+1 647 250 7098

Forward-Looking Statements

This news release contains or refers to certain forward-looking information. Forward-looking information can often be identified by forward-looking words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “estimate”, “may”, “potential” and “will” or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. All information other than information regarding historical fact, which addresses activities, events or developments that the Goldmoney Inc. believes, expects or anticipates will or may occur in the future, is forward-looking information. Forward-looking information does not constitute historical fact but reflects the current expectations the Company regarding future results or events based on information that is currently available. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking information will not occur. Such forward-looking information in this release speak only as of the date hereof.

Forward-looking information in this release includes, but is not limited to, statements with respect to: service times for transactions on the Goldmoney network, future business plans, including joint ventures and acquisitions of real estate, future plans to diversify the Company’s business, expectations on growth of the Company’s business, expected results of operations, and the market for the Company’s products and services and competitive conditions. This forward-looking information is based on reasonable assumptions and estimates of management of the Company at the time it was made, and involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others: the Company’s operating history; history of operating losses; future capital needs and uncertainty of additional financing; fluctuations in the market price of the Company’s common shares; the effect of government regulation and compliance on the Company and the industry; legal and regulatory change and uncertainty; jurisdictional factors associated with international operations; foreign restrictions on the Company’s operations; product development and rapid technological change; dependence on technical infrastructure; protection of intellectual property; use and storage of personal information and compliance with privacy laws; network security risks; risk of system failure or inadequacy; the Company’s ability to manage rapid growth; competition; the ability to identify opportunities for growth internally and through acquisitions and strategic relationships on terms which are economic or at all; effectiveness of the Company’s risk management and internal controls; use of the Company’s services for improper or illegal purposes; uninsured and underinsured losses; theft & risk of physical harm to personnel; real estate acquisition and maintenance risks; volatility of real estate prices & markets; precious metal trading risks; volatility of precious metals prices & public interest in precious metals investment; global financial conditions and the viability of the Company’s business strategy in response to them; and those risks set out in the Company’s most recently filed annual information form, available on SEDAR. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to update or revise any forward-looking information, except as required by law.

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