FRMO Corp. (the “Company” or “FRMO”) (OTC Pink:FRMO) today reported its financial results for the 2016 third quarter, which ended February 29, 2016 (May Fiscal Year).
Financial Highlights
FRMO’s 2016 book value was $93.0 million ($2.12 per share on a fully diluted basis) as of February 29, 2016, compared with $102.2 million ($2.32 per share) as of May 31, 2015, the prior fiscal year-end. Current assets, comprised primarily of cash and equivalents and investments available for sale, amounted to $86.164 million as of February 29, 2016, and $94.5 million as of May 31, 2015. Total liabilities were $17.6 million as of February 29, 2016, compared to $16.5 million as of May 31, 2015, the majority of each being deferred taxes.
FRMO’s net income for the three months ended February 29, 2016 was $189,395 ($0.00 per share basic and diluted) compared to $1,328,204 ($0.03 per share basic and diluted) for the same three month period in 2015. Income from operations for the third quarter of fiscal 2016 was $407,546, compared to $2,047,023, for the same period in the prior year. Comprehensive income for the same periods, which includes unrealized investment losses, was ($5,240,692), down from $175,768.
For the nine months ended February 29, 2016, net income was $2,792,308 ($0.06 per share basic and diluted) compared to $3,156,843 ($0.07 per share basic and diluted) in the prior year, and income from operations was $5,138,061 up from $4,921,886 for the same period in 2015. Comprehensive income for the same periods, which includes unrealized investment losses, was ($9,856,984) down from $3,068,178.
Further details are available in the Quarterly Report of the Company’s Consolidated Financial Statements for the quarter ended February 29, 2016. These statements have been filed on the OTC Markets Group Disclosure and News Services, which may be accessed at www.otcmarkets.com/stock/FRMO/filings. These documents are also available on the FRMO web site at www.frmocorp.com.
Conference Call
Murray Stahl, Chairman and CEO, and Steven Bregman, President and CFO, will host a conference call on Tuesday, April 19, 2016 at 4:15 p.m. EST. Only questions submitted to info@frmocorp.com before 1:00 p.m. on the day of the call will be considered. The call can be accessed by dialing 1-888-430-8694 (domestic toll free) or 1-719-325-2323 (international toll) and entering the following conference ID: 1153946. A replay will be available from 7:15 p.m. on the day of the teleconference until May 19, 2016. To listen to the archived call, dial 1-888-203-1112 (domestic toll free) or 1-719-457-0820 (international toll), and enter conference ID number 1153946.
| Condensed Consolidated Balance Sheets | ||||||
| (in thousands) | ||||||
| February 29, | May 31, | |||||
| 2016 | 2015 | |||||
| (Unaudited) | ||||||
| Assets | ||||||
| Current Assets: | ||||||
| Cash and cash equivalents | $ | 47,160 | $ | 44,745 | ||
| Investments, available for sale, at fair value | 36,011 | 48,008 | ||||
| Other | 2,993 | 1,743 | ||||
| Total Current Assets | 86,164 | 94,496 | ||||
| Investment in HK Hard Assets LLC | 157 | - | ||||
| Investment in Digital Currency Group Inc | 76 | - | ||||
| Investment in Canadian Securities Exchange | 214 | - | ||||
| Investment in The Bermuda Stock Exchange | 2,638 | 2,639 | ||||
| Investment in Horizon Kinetics LLC | 10,935 | 11,200 | ||||
| Participation in Horizon Kinetics LLC revenue stream | 10,200 | 10,200 | ||||
| Investment in OneChicago LLC | 246 | - | ||||
| Other assets | - | 138 | ||||
| Total Assets | $ | 110,630 | $ | 118,673 | ||
| Liabilities and Stockholders' Equity | ||||||
| Current Liabilities: | ||||||
| Deferred Tax Liability | $ | 5,814 | $ | 10,286 | ||
| Other current liabilities | 7,463 | 1,949 | ||||
| Total Current Liabilities | 13,277 | 12,235 | ||||
| Deferred Tax Liability - non-current | 4,320 | 4,274 | ||||
| Total Liabilities | 17,597 | 16,509 | ||||
| Stockholders' Equity | 93,033 | 102,164 | ||||
| Total Liabilities and Stockholders' Equity | $ | 110,630 | $ | 118,673 | ||
| Condensed Consolidated Statements of Income | ||||||||||||
| (amounts in thousands, except share data) | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| February 29, | February 28, | February 29, | February 28, | |||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Revenue: | ||||||||||||
| Consultancy and advisory fees | $ | 763 | $ | 758 | $ | 2,030 | $ | 2,480 | ||||
| Income (loss) from investment partnerships | ||||||||||||
| and limited liability companies | (1,771) | 426 | 908 | 761 | ||||||||
| Income (loss) from unconsolidated subsidiary | (30) | 9 | (1) | 70 | ||||||||
| Other | 1,614 | 975 | 2,726 | 2,089 | ||||||||
| Total Revenue | 576 | 2,168 | 5,663 | 5,400 | ||||||||
| Total Expenses | 169 | 121 | 525 | 478 | ||||||||
| Income from Operations | 407 | 2,047 | 5,138 | 4,922 | ||||||||
| Provision for Income Taxes | 218 | 719 | 2,346 | 1,765 | ||||||||
| Net Income | $ | 189 | $ | 1,328 | $ | 2,792 | $ | 3,157 | ||||
| Diluted Earnings per Common Share | $ | 0.00 | $ | 0.03 | $ | 0.06 | $ | 0.07 | ||||
| Weighted Average Common Shares Outstanding | ||||||||||||
| Basic | 43,865,463 | 43,680,405 | 43,775,491 | 43,617,908 | ||||||||
| Diluted | 43,914,548 | 44,092,725 | 43,828,423 | 44,037,496 | ||||||||
About FRMO Corp.
FRMO Corp. invests in and receives revenues based upon consulting and advisory fee interests in the asset management sector.
FRMO has 43,953,155 shares of common stock outstanding as of February 29, 2016.
For more information, visit our Web site at www frmocorp.com.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 – With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. Words like “believe,” “expect” and “anticipate” mean that these are our best estimates as of this writing, but that there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, the general economics of the financial industry, our ability to finance growth, our ability to identify and close acquisitions on terms favorable to the Company, and a sustainable market.
Further information on our risk factors is contained in our quarterly and annual reports as filed on our website www.frmocorp.com and on www.otcmarkets.com/stock/FRMO/filings.
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