Great Elm Group, Inc. · NASDAQ:GEG
Great Elm — Q2 2023 Earnings Presentation
18 slides from Great Elm's earnings presentation, Feb 14, 2023
Slide 1: Fiscal Second Quarter Ended December 31, 2022
February 13, 2023 Fiscal Second Quarter Ended December 31, 2022 NASDAQ: GEG
Slide 2: Focus on Scaling Alternative Asset Management
Focus on Scaling Alternative Asset Management Fiscal Q2 2023 marks a transformative period anchored by two successful transactions in December 2022 and January 2023. GEG is Now Solely Sale of Majority Sale of DME Focused on Scaling Interest in Forest for + Business for = Alternative Asset $45 Millio
Slide 3: Transformative Transactions
Transformative Transactions Sale of Majority Interest in Forest for $45 Million Forest GEG is Solely Focused on • $27 million from the right to put the remaining 19% ownership interest in Scaling Alternative Asset Forest in January 2023 GECC Management BDC • $18 million from sale of 61% of the DME •
Slide 4: Combined the Transactions
Combined the Transactions: Provide significant Simplify the Add $70 million+ organization and capital to accelerate of cash to GEG’s reporting balance sheet growth of alternative asset management structure February 13, 2023 4
Slide 5: Summary Pro Forma Financial Position
Summary Pro Forma Financial Position GEG December 31 balance sheet as adjusted for January DME Sale and Forest Transaction $ Million 12/31/2022 PF Cash and Cash Equivalents $ 89.9 Current Liabilities $ 7.9 Investments 30.0 Long-Term Debt 25.7 Other Current and LT Assets 19.6 Convertible Notes 36.1 O
Slide 6: DME Sale Pro Forma Cash
DME Sale Pro Forma Cash $26.3 Total Consideration Preferred Stock Minority Shareholder Proceeds Debt Assumption Other Net Cash Proceeds Repayment Distributions Received in Stock February 13, 2023 6
Slide 7: Pro Forma Simplified Organizational Structure
Pro Forma Simplified Organizational Structure Streamlined Organization Focused on Scaling an Alternative Asset Management Business GEG GECC GECM Monomoy Public BDC with SEC Registered Private Industrial REIT $232 million of Investment with $370 million of real Fee-Paying AUM1 Advisor estate assets a
Slide 8: Fiscal 2023 Second Quarter Highlights
Fiscal 2023 Second Quarter Highlights February 13, 2023 8
Slide 9: Financial Highlights
Financial Highlights Revenue Net Income Adjusted EBITDA1 • FY 2Q23 revenue up 84% vs • Net income of $29.7 million • FY 2Q23 Adjusted EBITDA of FY 2Q22 to $1.9 million for FY 2Q23, compared to a ($1.2) million, approximately net loss of $4.2 million in FY unchanged from FY 2Q22 • Increase primarily
Slide 10: Assets Under Management
Assets Under Management AUM FPAUM 700 500 $607 $619 $437 450 $408 600 400 500 2% 350 7% 400 300 250 300 200 200 150 100 100 50 0 0 6/30/2022 12/31/2022 6/30/2022 12/31/2022 $619 million of Assets Under Management $437 million of Fee-Paying AUM (“FPAUM”), (“AUM”), up 2% since June 30, 2022 up 7% sinc
Slide 11: Results By Quarter
Results By Quarter (in thousands) Three Months Ended December 31, September 30, June 30, March 31, December 31, 2022 2022 2022 2022 2021 Total revenues $ 1,879 $ 1,860 $ 1,524 $ 988 $ 1,021 Net income (loss) from continuing operations - GAAP $ 29,693 $ (9,503) $ (5,240) $ (6,445) $ (4,790) Interest
Slide 12: Results Year-Over-Year
Results Year-Over-Year (in thousands) Three Months Ended Six Months Ended December 31, December 31, December 31, December 31, 2022 2021 2022 2021 Net income (loss) from continuing operations - GAAP $ 29,693 $ (4,790) $ 20,190 $ (7,539) Interest expense 1,955 1,293 3,929 2,586 Dividend income on inve
Slide 13: Financial Review: FY 2Q23 Balance Sheet
Financial Review: FY 2Q23 Balance Sheet (in thousands) December 31, June 30, 2022 2022 ASSETS Cash and cash equivalents $ 18,971 $ 22,281 Receivables from managed funds 2,318 2,445 Investments at fair value 54,536 48,042 Investments at fair value, consolidated funds - 2,543 Prepaid and other current
Slide 14: Financial Review: FY 2Q23 Income Statement
Financial Review: FY 2Q23 Income Statement (in thousands) Three M onths Ende d Six Months Ended Dece mber 31, December 31, December 31, Dece mber 31, 2022 2021 2022 2021 Revenues 1,879 1,021 3,739 2,004 Operating costs and e xpenses: Investment management expenses 2,311 1,969 4,300 3,156 Depreciatio
Slide 15: Appendix
Appendix February 13, 2023 15
Slide 16: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation (in thousands) Three Months Ended Six Months Ended December 31, December 31, December 31, December 31, 2022 2021 2022 2021 Net income (loss) from continuing operations - GAAP $ 29,693 $ (4,790) $ 20,190 $ (7,539) Interest expense 1,955 1,293 3,929 2,586 Dividend inc
Slide 17: Appendix: Contact Information
Appendix: Contact Information Investor Relations Contact geginvestorrelations@greatelmcap.com February 13, 2023 17
Slide 18: Disclaimer
Disclaimer Statements in this press release that are “forward-looking” statements, including statements regarding expected growth, profitability, acquisition opportunities and outlook involve risks and uncertainties that may individually or collectively impact the matters described herein. Investors