Gold and Precious Metals

A-Mark Precious Metals Reports Q2 2024 Results, Reaffirms Dividend Policy

A-Mark Precious Metals Inc., a leading precious metals trading platform, delivered its fiscal second quarter results for the period ending December 31, 2023. The company reported a revenue increase of 7% to $2.079 billion, despite a softening demand in the precious metals market. This was partially offset by a decrease in gold and silver ounces sold which resulted in a 28% decrease in gross profit to $46.0 million. The diluted earnings stood at $0.57 per share with a non-GAAP EBITDA of $25.1 million.

Financial Highlights and Strategies

Throughout the quarter, A-Mark demonstrated strategic financial management. The company repurchased 440,092 shares and repaid its $100MM Asset Backed Securitization Notes Payable. Selling, general, and administrative expenses rose by 8%, while interest income increased by 27%, and interest expense rose by 41%. However, net income for the company was $13.8 million ($0.57 per diluted share), down from $33.5 million ($1.35 per diluted share) in the previous year’s quarter.

Performance in the First Half of Fiscal 2024

For the first six months of fiscal 2024, revenues increased by 19% to $4.563 billion, yet net income totaled to $32.6 million ($1.34 per diluted share), marking a decrease from the previous year. Despite these figures, A-Mark reaffirmed its regular quarterly cash dividend policy of $0.20 per share with the next expected payout in April 2024. This reaffirmation indicates the company’s confidence in its financial performance and commitment to providing consistent shareholder returns.

Strategic Moves and Future Outlook

A-Mark continues to pursue strategic opportunities, including mergers and acquisitions. The company has entered into a non-binding letter of intent with AMS Holding LLC for three transactions, including the proposed acquisition of LPM Group Limited, one of Asia’s largest precious metals dealers. This acquisition is an important step in growing A-Mark’s international presence, specifically in Asia. The company is also investing in logistics automation at its AMGL facility in Las Vegas aiming to support its growth strategy.

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