Goldmoney Inc. Reports Financial Results for Third Quarter 2021

Rhea-AI Summary

Goldmoney Inc. (TSX:XAU) (US:XAUMF) reported Q3 financial results for the quarter ended December 31, 2020. Key highlights include a 13% increase in quarterly gross profit to $4.9 million and a 304% rise in fee revenue, reaching a record $2.9 million. Net income surged 173% YoY to $4.2 million, with earnings per share of $0.05. However, total revenue declined 10% YoY to $97.6 million. Client assets increased 18% to $2.5 billion. Overall, the company demonstrated operational efficiencies despite typical seasonal challenges.

Positive

• Gross profit increased by 13% YoY to $4.9 million.
• Fee revenue surged 304% YoY to $2.9 million, a new record.
• Net income increased by $10 million (173%) YoY to $4.2 million.
• Client assets grew 18% YoY to $2.5 billion.

Negative

• Total revenue declined by 10% YoY to $97.6 million.

Goldmoney Inc. (TSX:XAU) (US:XAUMF) (“Goldmoney” or the “Company”), a precious metal financial service and technology company, today announced financial results for the third quarter ended December 31, 2020. All amounts are expressed in Canadian dollars unless otherwise noted.

Quarterly Highlights

• Quarterly Gross Profit of $4.9 million, an increase of 13% Year-over-Year (“YoY”).
• Fee Revenue increased by 304% YoY to a new company record of $2.9 million.
• Net and Comprehensive Income of $4.2 million, a $10 million (173%) increase YoY.
• Basic and Diluted Earnings per share of $0.05. Earnings in gold weight of 0.66 grams per 1,000 Goldmoney shares (based on December 31, 2020 London Bullion Market 15:00 London BST gold price).
• Revenue of $97.6 million, a decrease of 10% YoY.
• Goldmoney.com reported a 274% increase in Operating Income, 14% increase in Gross Profit and 76% in Gross Margin YoY.
• Goldmoney.com Group Client Assets increased 18% YoY to $2.5 billion as at December 31, 2020.
• SchiffGold Revenue increased $4.1 million or 10% YoY, and Operating Income increased $0.2 million or 108% YoY.
• Investee Company Menē Inc. (TSXV:MENE) continued to grow its client and revenue base, reporting record Annual Revenue of $21.3 million, or 64% increase YoY, for its Fiscal Year 2020 in unaudited preliminary results.
• Corporate Metal Position consisting of Coins, Bullion, and Bullion Denominated Loan increased by $5.3 million, or 11% Quarter-over-Quarter (“QoQ”) to $51.9 million as at December 31, 2020, a new company record.
• Tangible Capital increased 4% QoQ to $128.1 million.

IFRS Consolidated Income
Statement Data
($000s, except earnings per share)		FY 2021				FY 2020								FY 2019
		Q3		Q2		Q1		Q4		Q3		Q2		Q1		Q4
Revenue		97,592		243,609		173,500		164,441		108,161		127,154		59,116		64,171
Gross margin		3,401		7,566		5,981		4,390		2,469		2,501		1,517		1,393
Fee revenue		2,905		1,776		2,351		2,489		719		599		606		591
Interest income		195		217		239		374		461		536		555		416
Gross profit Excl. revaluation of precious metals inventories		6,501		9,558		8,570		7,253		3,649		3,633		2,682		2,782
Gross profit Incl. revaluation of precious metals inventories		4,917		10,421		10,615		8,157		4,369		5,636		4,104		2,069
Net income (loss)		4,041		7,509		6,049		(7,892)		(2,958)		1,054		83		(2,313)
Basic earnings (loss) per share		0.05		0.10		0.08		(0.10)		(0.04)		0.01		0.00		(0.03)

Refer to “Use of Non-IFRS Financial Measures” and “Reconciliation of Non-IFRS Financial Measures” in the MD&A

Statement from Roy Sebag, Chairman and Chief Executive Officer:

Goldmoney continues to execute on its long-term strategy presented in the shareholder letter from 2020. While the calendar fourth quarter is always the weakest in our business, operational efficiencies and discipline contributed to the superior operating results and profitability year over year. Importantly, this is now our third consecutive quarter of producing IFRS net income and earnings per share. Another milestone from the shareholder letter was reached in calendar 2020 and that is of course our precious metal bullion position which stood at $51.9 million at year end. We continue to feel strongly about our ability to grow this position over both the short and long term through our diversified business streams, thus achieving a high return on metal weight for shareholders. Finally, I believe we may be on the precipice of a significant move into precious metals by the public and private sector. Goldmoney intends to serve these clients with our best-in-class technology platform, vaulting network, and trusted brand.

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 ended December 31, 2020 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.

Investor Questions

Shareholders of Goldmoney are encouraged to submit questions to management by emailing ir@goldmoney.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.

Gross profit excluding gain/loss on revaluation of inventories is a non-IFRS measure, calculated as gross profit less gain/(loss) on revaluation of precious metals. The closest comparable IFRS financial measure is gross profit. Fluctuations in the value of its precious metal inventories caused by fluctuations in market prices are included in gross profit. Management believes that excluding such fluctuations more clearly illustrates the Company’s business operations.

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 December 31, 2020.

About Goldmoney Inc.

Goldmoney Inc. (TSX:XAU) is a precious metal focused global business. Through its ownership of various operating subsidiaries, the company is engaged in precious metal sales to its clients, including arranging delivery and storage of precious metals for its clients, coin retailing, and lending. Goldmoney clients located in over 150 countries hold approximately $2.5 billion in precious metal assets. The company’s operating subsidiaries include: Goldmoney.com, SchiffGold.com and Goldmoney Lend & Borrow. In addition to the Company’s principal business segments, the Company holds a significant interest in Menē Inc., which crafts pure 24-karat gold and platinum investment jewelry that is sold by gram weight. Through these businesses and other investment activities, Goldmoney gains long-term exposure to precious metals. For more information about Goldmoney, visit goldmoney.com.

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; 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; precious metal trading risks; and volatility of precious metals prices & public interest in precious metals investment; 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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FAQ

What were Goldmoney's Q3 financial results for 2020?

Goldmoney reported Q3 2020 financial results with a gross profit of $4.9 million and total revenue of $97.6 million, a 10% decline YoY.

How much did Goldmoney's fee revenue increase in Q3 2020?

Goldmoney's fee revenue increased by 304% YoY to a record $2.9 million for Q3 2020.

What is Goldmoney's net income for Q3 2020?

The net income for Goldmoney in Q3 2020 was $4.2 million, reflecting a 173% increase YoY.

What was Goldmoney's earnings per share in Q3 2020?

Goldmoney reported basic and diluted earnings per share of $0.05 for Q3 2020.

What are the client assets for Goldmoney as of December 31, 2020?

As of December 31, 2020, Goldmoney's client assets reached $2.5 billion, an increase of 18% YoY.