U.S. Global Investors, Inc.
), a boutique registered investment advisory firm specializing in natural resources, emerging markets, and domestic equities and municipal bonds, recorded a net loss of $1,165,207, or $0.08 per share loss, on operating revenues of $2.74 million for the quarter ended December 31, 2013.
Net income for the same quarter of the previous year was $165,985, or $0.01 per share, on operating revenues of $4.97 million.
Average assets under management were $1.11 billion for the quarter ended December 31, 2013, compared to an average of $1.68 billion for the same quarter a year ago, a decrease of about 34 percent. Period-end assets under management stood at $0.97 billion as of December 31, 2013, versus $1.61 billion under management as of December 31, 2012.
“A big external pressure affecting assets under management has been the fact that global gold equities declined three years in a row,” says Frank Holmes, U.S. Global Investors CEO. “Additionally, the close-to-zero federal funds rate created an industry-wide financial burden to support the yield of money market funds.”
In this challenging environment, the company has been focused on reducing costs and streamlining its products and services in the second fiscal quarter of 2014. Changes included converting a money market fund to an ultra-short government bond fund, closing the U.S. Treasury Securities Cash Fund and the Global Emerging Markets Fund, merging the Tax Free Fund into the Near-Term Tax Free Fund, reorganizing the MegaTrends Fund into the Holmes Growth Fund, and partnering with U.S. Bancorp for transfer agency services.
“Accomplishing these strategic changes was expensive and time-consuming. Time is money and the length of time associated with the legal and regulatory processes increased one-time costs,” says Holmes. “Moving forward from our period of transitioning, general and administrative expenses have been decreasing significantly in January 2014. The organization is leaner, now with less than 50 employees, and in a stronger financial position, especially as gold and resources look to rebound.”