U.S. Global Investors, Inc. (NASDAQ:GROW) Q1 2019 Earnings Conference Call Transcript

Nov 09, 2018 • 08:30 am ET


U.S. Global Investors, Inc. (NASDAQ:GROW) Q1 2019 Earnings Conference Call Transcript


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Holly Schoenfeldt

Good morning and thank you for joining us today for our webcast announcing U.S. Global Investors' results for the first quarter of fiscal year 2019. I'm Holly Schoenfeldt. If you have any questions during the webcast, you can enter them in the questions area of the control panel side bar, which is normally to the right of your screen. Also, you may download a PDF of today's slides by clicking on the red handout button.

The presenters for today's program are Frank Holmes, U.S. Global Investors' CEO and Chief Investment Officer; Lisa Callicotte, CFO; and myself, Holly Schoenfeldt, marketing and public relations Manager.

(Forward-Looking Cautionary Statements)

Now let's go to Frank Holmes, CEO and CIO, for an overview of the period, but really briefly let me go over about GROW before I pass it on. U.S. Global Investors is an innovative investment manager with vast experience in global markets and specialized sectors. We were founded as an investment club, and the company became a registered investment adviser in 1968 and has had a long-standing history of global investing and launching first of their kind investment products, including the first no-load gold fund.

U.S. Global is well known for expertise in gold and precious metals, natural resources and emerging markets.

Frank Holmes

Thank you, Holly. I give you an interesting history taking place in San Antonio, Texas, is USAA, which is a fantastic company, had sold their fund business their mutual fund business, and I think what's interesting is that they started a gold fund because they had so many military people call them and ask them about our gold fund because our gold fund, the first no-load gold fund, was created by a Colonel from the Air Force, who fought in World War II, Colonel Clark Aylsworth and he had built this investment club that became a mutual fund is a big believer in gold. And I think it's so interesting that now we are still here and USAA is getting out of fund business. But it's been a tough go. I'm going to try to talk through some of our strengths and challenges we're all dealing with in the fund industry as a whole, but the big strengths for our survivorship is we strive to be the go-to stock for exposure in emerging markets and resources and then expanded that into digital currencies, which has become as -- gold is always a form of money, the fourth most liquid asset class in the world -- digital currencies has grown, still only a dwarf compared to the gold markets or the cash markets, but growing.

We're debt-free. We have a strong balance sheet and we have this reflexive cost structure and we have a monthly dividend and return on equity discipline. I want to thank our top institutional holders, particularly Royce Funds, have been up and down and they themselves have experienced the contraction in active fund management that has taken place. And I'm going to comment about cheaper is not better, and