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What changed in Marygold Companies, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Marygold Companies, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+273 added−638 removedSource: 10-K (2024-09-18) vs 10-K (2023-09-25)

Top changes in Marygold Companies, Inc.'s 2024 10-K

273 paragraphs added · 638 removed · 128 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

58 edited+59 added−48 removed5 unchanged
Biggest changeUSCF Advisers as fund manager for each series within the USCF ETF Trust: USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund ("SDCI") Fund launched May 2018 USCF Midstream Energy Income Fund ("UMI") Fund launched March 2021 USCF Gold Strategy Plus Income Fund ("GLDX") Fund launched November 2021 USCF Dividend Income Fund ("UDI") Fund launched June 2022 USCF Sustainable Battery Metals Strategy Fund ("ZSB") Fund launched January 2023 USCF Energy Commodity Strategy Absolute Return Fund ("USE”) Fund launched May 2023 All commodity pools managed by USCF and each series of the ETF Trust managed by USCF Advisers are collectively referred to as the “Funds” hereafter.
Biggest changeUSCF Advisers as fund manager for the following series of the ETF Trust: USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund (“SDCI”) Fund launched in 2018 USCF Midstream Energy Income Fund (“UMI”) Fund launched in 2021 USCF Gold Strategy Plus Income Fund (“USG”) previous ticker (“GLDX”) Fund launched in 2021, Ticker symbol change in 2024 USCF Dividend Income Fund (“UDI”) Fund launched in 2022 USCF Sustainable Battery Metals Strategy Fund (“ZSB”) Fund launched in 2023 USCF Energy Commodity Strategy Absolute Return Fund (“USE”) Fund launched in 2023 USCF Sustainable Commodity Strategy Fund (“ZSC”) Fund launched in 2023 USCF Aluminum Strategy Fund (“ALUM”) Fund launched in 2023 USCF Investments’ revenue and expenses are primarily based upon and determined by the amount of AUM of the funds its subsidiaries manage.
Regulation In the U.S. our subsidiary, Original Sprout, is not required to have permits or inspections by regulatory agencies for the products it formulates and distributes in the U.S.; however, it has chosen to gain recognition from certain testing laboratories and other quasi-regulatory agencies for compliance with accepted standards for hair and skin care ingredients and lack of toxic chemicals in their formulas and processes.
Regulation Original Sprout is not required to have permits or inspections by regulatory agencies for the products it formulates and distributes in the U.S.; however, it has chosen to gain recognition from certain testing laboratories and other quasi-regulatory agencies for compliance with accepted standards for hair and skin care ingredients and lack of toxic chemicals in their formulas and processes.
Original Sprout is focused on promoting its own brand name as a recognized pioneer in 100% vegan, safe, effective, hair care products through the recruitment of additional distributors, contracts with additional nationwide retail stores, a continued emphasis on online sales either directly or through retail stores and an increased social media presence.
Original Sprout is focused on promoting its own brand name as a recognized pioneer in 100% vegan, safe, effective, hair care products through the recruitment of additional distributors, nationwide retail stores, a continued emphasis on online sales either directly or through retail stores and an increased social media presence.
For export, Original Sprout is often compelled to submit its products to foreign government agencies or certified laboratories for ingredient testing prior to being accepted for import as a “safe” product. We believe that Original Sprout products comply with all applicable regulations, both domestic and foreign, in areas where they are sold or distributed.
For export, Original Sprout is often required to submit its products to foreign government agencies or certified laboratories for ingredient testing prior to being accepted for import as a “safe” product. We believe that Original Sprout products comply with all applicable regulations, both domestic and foreign, in areas where they are sold or distributed.
Original Sprout formulates and packages various hair and skin care products that are 100% vegan, tested safe and non-toxic, and marketed globally through distribution networks to salons, resorts, grocery stores, health food stores, e-tail sites and on Original Sprout's website. Original Sprout operates from warehouse and sales offices located in San Clemente, CA, USA.
Original Sprout formulates and packages various hair and skin care products that are 100% vegan, tested safe and non-toxic, and marketed globally through distribution networks to salons, resorts, grocery stores, health food stores, e-tail sites and on Original Sprout’s website. Original Sprout operates from warehouse and sales offices located in San Clemente, California.
Competition Original Sprout manufactures and distributes only 100% vegan, safe and non-toxic, hair and skin care products which it believes differentiate it significantly from competitors that do not employ such standards.
Competition Original Sprout manufactures and distributes only 100% vegan, safe and non-toxic, hair and skin care products which it believes differentiates it significantly from competitors that do not employ such standards.
Original Sprout believes that these steps will allow for the continued growth of annual revenues and market share protection, though there can be no guarantees that such efforts will be sufficient to offset the effects of competition in the future.
Original Sprout believes that these steps will allow for the growth of annual revenues and market share protection, though there can be no assurance that such efforts will be sufficient to offset the effects of competition in the future.
As such, we are exempt from certain NYSE American rules requiring our Board of Directors to have a majority of independent members, a compensation committee composed entirely of independent directors and a nominating and governance committee composed entirely of independent directors.
As such, we are exempt from certain NYSE American rules requiring our Board of Directors to have a majority of independent members, a compensation committee composed entirely of independent directors and a nominating and governance committee composed entirely of independent directors. 10 Table of Contents
These cost increases, coupled with rising cost of labor, have negatively impacted Gourmet Foods profit margins and, in some instances, their ability to meet market demand in a timely manner. Although raw material availability has begun to return to normal levels, there remains a shortage of qualified labor for both the bakery and the printing sector at acceptable wage levels.
These cost increases, coupled with the rising cost of labor, have negatively impacted Gourmet Foods profit margins and, in some instances, its ability to meet market demand in a timely manner. Although raw material availability has begun to return to normal levels, there remains a shortage of qualified labor for both the bakery and the printing sector.
Under the terms of its authorized dealer contract with the monitoring company, Brigadier earns monthly payments during the term of the monitoring contract in exchange for performance of customer service activities on behalf of the monitoring company. 8 Table of Contents The Marygold Companies, through Brigadier, is partially dependent upon its contractual relationship with the alarm monitoring company that provides monitoring services to Brigadier’s customers.
Under the terms of its authorized dealer contract with the monitoring company, Brigadier earns monthly payments during the term of the monitoring contract in exchange for performance of customer service activities on behalf of the monitoring company. 7 Table of Contents Brigadier is partially dependent upon its contractual relationship with an alarm monitoring company that provides monitoring services to Brigadier’s customers.
Pursuant to the current Investment Advisory Agreements, USCF Advisers provides an investment program for each of series within the ETF Trust and manages the investment of the assets.
Pursuant to investment advisory agreements, USCF Advisers provides an investment program for each series of the ETF Trust and manages the investment of the funds’ assets.
While these major groups are comprised of different customers and supply chains, we consider the consolidation of Gourmet Foods with Printstock to be within the food industry as Printstock only supplies the food industry manufacturers, some of which are competitors to Gourmet Foods, and the inclusion of Printstock to the Gourmet Foods operations does not extend its presence beyond the food industry.
While these product lines are comprised of different customers and supply chains, we consider the consolidation of Gourmet Foods with Printstock to be within the food industry as Printstock only supplies its products to the manufacturers in the food industry, some of which are competitors to Gourmet Foods, and the inclusion of Printstock to the Gourmet Foods operations does not extend its presence beyond the food industry.
Prior to the pandemic Original Sprout relied heavily upon its wholesale distribution network to place products at retail locations and generally to make products available to consumers, whereas during the environment of social distancing and closures of retail businesses, consumers avoided traditional sales outlets.
Prior to the pandemic Original Sprout relied heavily upon its wholesale distribution network to place products at retail locations and generally to make products available to consumers, whereas during COVID-19 that resulted in social distancing and closures of retail businesses, consumers avoided traditional sales outlets.
Products and Customers As a result of the COVID-19 pandemic, Original Sprout has made adjustments to its primary distribution and marketing channels.
Products and Customers As a result of the COVID-19 pandemic, Original Sprout has adjusted its primary distribution and marketing channels.
USCF currently serves as the General Partner or the Sponsor to the following commodity pools, each of which is currently conducting a public offering of its shares pursuant to the Securities Act of 1933, as amended: USCF as General Partner for the following funds United States Oil Fund, LP (“USO”) Organized as a Delaware limited partnership in May 2005 United States Natural Gas Fund, LP (“UNG”) Organized as a Delaware limited partnership in November 2006 United States Gasoline Fund, LP (“UGA”) Organized as a Delaware limited partnership in April 2007 United States 12 Month Oil Fund, LP (“USL”) Organized as a Delaware limited partnership in June 2007 United States 12 Month Natural Gas Fund, LP (“UNL”) Organized as a Delaware limited partnership in June 2007 United States Brent Oil Fund, LP (“BNO”) Organized as a Delaware limited partnership in September 2009 5 Table of Contents USCF as fund Sponsor - each a series within the United States Commodity Index Funds Trust ("USCIF Trust") United States Commodity Index Fund (“USCI”) Series of the USCIF Trust created in April 2010 United States Copper Index Fund (“CPER”) Series of the USCIF Trust created in November 2010 USCF Advisers, a registered investment adviser, serves as the investment adviser to the funds listed below within the USCF ETF Trust (the “ETF Trust”) and has overall responsibility for the general management and administration for the ETF Trust.
Currently, USCF LLC serves as the general partner or sponsor of the following ETFs, each of which is conducting an ongoing public offering of its shares or interests pursuant to the Securities Act of 1933, as amended (“Securities Act”): USCF LLC as general partner of the following funds United States Oil Fund, LP (“USO”) Organized as a Delaware limited partnership in 2005 United States Natural Gas Fund, LP (“UNG”) Organized as a Delaware limited partnership in 2006 United States Gasoline Fund, LP (“UGA”) Organized as a Delaware limited partnership in 2007 United States 12 Month Oil Fund, LP (“USL”) Organized as a Delaware limited partnership in 2007 United States 12 Month Natural Gas Fund, LP (“UNL”) Organized as a Delaware limited partnership in 2007 United States Brent Oil Fund, LP (“BNO”) Organized as a Delaware limited partnership in 2009 4 Table of Contents USCF LLC is the sponsor of the following funds, each a series of the United States Commodity Index Funds Trust (“USCIF Trust”) United States Commodity Index Fund (“USCI”) Series of the USCIF Trust created in 2010 United States Copper Index Fund (“CPER”) Series of the USCIF Trust created in 2010 USCF Advisers, a registered investment adviser, is the investment adviser to the funds listed below each a separate series of the USCF ETF Trust (“ETF Trust”) and has overall responsibility for the general management and administration of the ETF Trust.
In the event this contract is terminated, Brigadier would be compelled to find an alternate source of alarm monitoring, or establish such a facility itself. Management believes that the contractual relationship is sustainable, and has been for many years, with alternate solutions available should the need arise.
In the event this contract is terminated, Brigadier would be compelled to find an alternate source of alarm monitoring or establish such a facility itself. Management believes that the contractual relationship is sustainable, and has been for many years, but that alternate solutions would be available if such monitoring company terminates its agreement with Brigadier.
Intellectual Property The formulations and ingredient percentages of the many products of Original Sprout are considered its intellectual property, though many cannot be patented, they are maintained as confidential. The names "Original Sprout", "D’Organiques Original Sprout" are registered trademarks of Original Sprout.
Intellectual Property The formulations and ingredient percentages of the many products of Original Sprout are considered its intellectual property, although many cannot be patented, they are maintained as confidential. The names “Original Sprout” and “D’Organiques Original Sprout” are registered trademarks of Original Sprout.
Sources and Availability of Materials Original Sprout is dependent upon its relationships with two product formulating and packaging companies who, at the direction of Original Sprout, produce its products in accordance with proprietary formulas, packages them in appropriate containers, and delivers the finished goods to Original Sprout for distribution to its customers.
Sources and Availability of Materials Original Sprout is reliant upon its relationships with two product formulating and packaging companies who, at the direction of Original Sprout, manufacture its products in accordance with proprietary formulas, package them in appropriate containers supplied by Original Sprout, and deliver the finished goods to Original Sprout for distribution to its customers.
The Company manages its operating businesses on a decentralized basis. There are no centralized or integrated operational functions such as marketing, sales, legal or other professional services and there is little involvement by the Company’s management in the day-to-day business affairs of its operating subsidiary businesses apart from oversight.
We manage the operations of our subsidiaries and their related businesses on a decentralized basis. There are no centralized or integrated operational functions such as marketing, sales, legal or other professional services and there is little involvement by our executive management in the day-to-day business affairs of our operating subsidiary businesses apart from oversight.
In response to this trend, many of Original Sprout's domestic distributors became retailers by selling direct to consumers on e-tail platforms. Original Sprout, in defense of its brand and price points, was compelled to commence a transition from its wholesale distribution model to one wherein Original Sprout sells direct to retail outlets, or even direct to consumers, through online platforms.
In response to this trend, many of Original Sprout’s domestic distributors became retailers by selling direct to consumers on e-tail platforms. Original Sprout, in defense of its brand and price points, was compelled to transition from its wholesale distribution model to making direct sales to retail outlets and consumers through online platforms as well as through wholesalers.
USCF is a commodity pool operator (“CPO”) subject to regulation by the Commodity Futures Trading Commission (the "CFTC") and the National Futures Association (the “NFA”) under the Commodities Exchange Act of 1936, as amended (the “CEA”).
USCF is a commodity pool operator (“CPO”) subject to regulation by the Commodity Futures Trading Commission (“CFTC”) and the National Futures Association (“NFA”) under the Commodities Exchange Act of 1936, as amended (“CEA”). USCF Advisers is an investment adviser registered under the Investment Advisers Act and as a CPO under the CEA.
Regulation In New Zealand our subsidiary, Gourmet Foods, is required to have certain permits from health regulatory agencies and export permits for certain products it chooses to export. Gourmet Foods is also subject to local regulations as are usual and customary for those in the food processing, manufacturing and distribution business.
Regulation In New Zealand, Gourmet Foods is required to have certain permits from health regulatory agencies and export permits for certain products it exports. Gourmet Foods is also subject to local regulations customary in the food processing, manufacturing and distribution industry in New Zealand.
Therefore, for the purpose of segment reporting (Note 16), both revenue streams are considered part of the same "food industry" segment. Baking: Within the baking sector there are three major customer groups; 1) grocery, 2) gasoline convenience stores, and 3) independent retailers and cafes.
Therefore, for the purpose of segment reporting, both revenue streams are considered part of the same “food products” segment. Baking and Printing: Within the baking sector Gourmet Foods has three major customer groups: 1) grocery, 2) gasoline convenience stores, and 3) independent retailers and cafes.
We make available free of charge on or through our website our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as soon as reasonably practicable after we electronically file or furnish such materials to the SEC.
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act are available free of charge on our website as soon as reasonably practicable after the reports are filed with, or furnished to, the SEC.
All of Original Sprout’s products are currently produced by these two packaging companies. If these relationships were to terminate, Original Sprout believes that there are other similar packaging companies available to Original Sprout at competitive pricing.
All of Original Sprout’s products are currently produced by these two packaging companies. However, management of Original Sprout believes that, if either of these companies were unable to provide such services, there are other similar production and packaging companies available at competitive pricing.
The negative effects of this transition are being realized through reduced sales revenues as a result of cancellation of domestic distribution channels. This trend is expected to continue well into the coming fiscal year as Original Sprout engages new brand representation and secures reliable sales channels for its new and existing product lines.
The negative effects of this transition resulted in reduced sales and increased operating losses as a result of the cancellation of domestic distribution channels. This trend is expected to continue as Original Sprout engages in new brand representation and secures reliable sales channels for its new and existing product lines.
The series of the ETF Trust managed by USCF Advisers are registered investment companies under the Investment Company Act of 1940, as amended. Employees USCF Investments’ operating subsidiaries employ approximately 14 persons, a majority of whom are located in Walnut Creek, California.
Each series of the ETF Trust managed by USCF Advisers is registered as an investment company under the Investment Company Act. Employees USCF Investments’ operating subsidiaries have 14 full-time employees, a majority of whom are located in its Walnut Creek, California office.
Controlled Company Status Pursuant to a voting agreement, (the “Voting Agreement”), Nicholas Gerber and Scott Schoenberger, through their respective trusts, will represent 22,948,008, or 56.84% of the Voting Stock with respect to matters that may have a material impact on Company strategy and shareholder rights.
Controlled Company Status Pursuant to a voting agreement dated July 9, 2004, Nicholas Gerber and Scott Schoenberger, through their respective trusts, represent over 50% of the voting stock with respect to matters that may have a material impact on our strategy and shareholder rights.
Sources and Availability of Materials Gourmet Foods, including Printstock, is not dependent upon any one major supplier as many alternative sources are available in the local marketplace should the need arise. However, the aftereffects of the COVID-19 pandemic have resulted in increased cost of raw ingredients and local shipping.
The two largest customers in the printing sector represented 67% of printing sector revenue in fiscal 2024. Sources and Availability of Materials Gourmet Foods, including Printstock, is not dependent upon any one major supplier as many alternative sources are available locally. However, the after-effects of the COVID-19 pandemic have resulted in increased cost of raw ingredients and local shipping.
Original Sprout sells its products through 3 channels to market: 1) direct sales to end users via online shopping carts, 2) sales through international wholesale distributors who, in turn, sell to other international retailers or wholesalers, and 3) to retail stores selling to end users either from the shelf or online. 9 Table of Contents Original Sprout has thousands of customers and, from time to time, certain of them become significant during specific reporting periods, but may not be significant during other periods.
Original Sprout sells its products through three distribution channels: ● direct sales to end users via online shopping carts; ● sales through international wholesale distributors who, in turn, sell to other international retailers or wholesalers, and ● to retail stores selling to end users either from the shelf or online. 8 Table of Contents During the year ended June 30, 2024, Original Sprout did not have any significant customers; however, certain of Original Sprout’s customers may, from time to time, become significant during the reporting periods.
For the year ended June 30, 2023 approximately 73% of USCF Investments’ revenue were attributed to its three largest funds which were United States Oil Fund, LP, United States Natural Gas Fund, LP and United States Commodity Index Fund as compared to the year ended June 30, 2022 with approximately 73% of the revenue attributed to United States Oil Fund, LP, United States Natural Gas Fund, LP and United States Commodity Index Fund.
For the year ended June 30, 2023, 73% of USCF Investments’ revenue was attributable to its subsidiaries’ management of United States Oil Fund, LP; United States Natural Gas Fund, LP and United States Commodity Index Fund.
USCF Advisers is an investment adviser registered under the Investment Advisers Act of 1940, as amended, and is also registered as a CPO under the CEA.
USCF Advisers is also registered as an investment adviser with the Securities and Exchange Commission (“SEC”) under the Investment Advisers Act of 1940, as amended (“Investment Advisers Act”).
Brigadier bases its vendor selection on several criteria including: price, availability, shipping costs, quality, suitability for purpose and the technical support of the manufacturer. Brigadier is not reliant on any one supplier.
The manufacture of electronic items such as those sought by Brigadier has expanded to a global scale thus providing Brigadier with a broad choice of suppliers. Brigadier bases its vendor selection on several criteria including: price, availability, shipping costs, quality, suitability for purpose and the technical support of the manufacturer. Brigadier is not reliant on any one supplier.
Public offerings conducted by ETPs sponsored by USCF are required to be registered with the Securities and Exchange Commission (the “SEC”) in accordance with the Securities Act of 1933, as amended and each ETP has SEC reporting obligations under the Securities Exchange Act of 1934, as amended.
Ongoing public offerings of the shares or other interests by ETFs sponsored by USCF LLC are required to be registered with the SEC under the Securities Act and each ETF has SEC reporting obligations under the Securities Exchange Act of 1934, as amended (“Securities Exchange Act”).
Competition Although it holds a leading market position in the province of Saskatchewan, Brigadier faces competition from larger, better financed companies that offer similar products and services throughout Canada and globally. In addition, it is possible that Brigadier may face increasing competition as disruptive technologies enter the market.
Competition Brigadier competes with several larger, better financed companies that offer similar products and services in Saskatchewan and Canada generally as well as globally. In addition, Brigadier may face increasing competition as disruptive technologies enter the market.
USCF Investments’ operating subsidiaries may also retain third-parties to provide custody, distribution, fund administration, transfer agency, and all other non-distribution related services necessary for each fund to operate.
USCF Investments’ operating subsidiaries may also retain third-parties to provide custody, distribution, fund administration, transfer agency, and all other non-distribution related services necessary for each fund to operate. USCF Investments, through its operating subsidiaries, bears all of its own expenses associated with providing these advisory services such as the expenses of the members of the independent board of directors.
The use of organic and natural extracts is a growing trend in the U.S. and abroad, and other established brands are beginning to make products that directly compete with Original Sprout.
The use of organic and natural extracts is a growing trend in the U.S. and abroad, and other established brands are beginning to make products that directly compete with Original Sprout. As more entrants in the high-end, vegan, hair care segment come into existence, some may be better financed and have more brand recognition and resources than Original Sprout.
Gourmet Foods believes it has all necessary licenses and permits and is compliant in all material respects with New Zealand laws and local regulations. Employees Gourmet Foods, including Printstock, employs approximately 52 persons in New Zealand. Intellectual Property Gourmet Foods, Ponsonby Pies and Pat’s Pantry are all registered trademarks of Gourmet Foods, Ltd.
Gourmet Foods believes it has all necessary licenses and permits and is compliant in all material respects with New Zealand laws and local regulations. Employees Gourmet Foods, including Printstock, had 52 full-time employees in New Zealand as of June 30, 2024.
Brigadier provides comprehensive security solutions including access control, camera systems, fire alarm monitoring panels, and intrusion alarms to home and business owners as well as government offices, schools, and public buildings. Their experience as the provider of choice on many large notable sites shows a commitment to design, service and support.
Services, Products and Customers Brigadier is a leading electronic security company in the Province of Saskatchewan. Brigadier provides comprehensive security solutions including access control, camera systems, fire alarm monitoring panels, and intrusion alarms to home and business owners as well as government offices, schools, and public buildings.
Securities and Exchange Commission ("SEC") maintains an Internet site at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC, from which investors can electronically access The Marygold Companies' SEC filings.
The information on our website is not incorporated by reference in this Annual Report on Form 10-K or our other securities filings with the SEC. The SEC maintains an Internet site at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC, from which investors may electronically access our SEC filings.
Seasonality There is no significant seasonality for sales of products for Original Sprout, though sales will fluctuate around traditional holidays, and certain products, such as sunscreen, will be lower in winter months than in summer months. Overall, The Marygold Companies, on a consolidated basis, does not experience any material seasonality due to Original Sprout.
Seasonality There is no significant seasonality for sales of products for Original Sprout, although sales may fluctuate around traditional holidays, and certain products, such as sunscreen, are lower in winter months than in summer months.
Seasonality Brigadier, due to its location in the province of Saskatchewan, Canada, is far enough north that winter weather has a negative effect on its ability to complete some installations, particularly those involving new construction. For this reason, the period from November through March typically produces less revenue than comparison periods during other seasons of the year.
Seasonality Due to its location in Canada, winter weather may negatively affect its ability to complete some installations, particularly those involving new construction. For this reason, during the period from November through March Brigadier’s revenue is typically lower than during other months of the year. Employees Brigadier had 20 full-time employees in Canada as of June 30, 2024.
Printstock, in turn, also faces competition from other New Zealand-based printing companies who offer similar services to the food production industry. Seasonality The location of Gourmet Foods in the southern hemisphere provides it with a warm Christmas holiday season and some increased business as customers tend to be traveling and purchase more ready-to-eat foods.
Seasonality The location of Gourmet Foods in the southern hemisphere provides it with a warm Christmas holiday season and some increased business as customers tend to be traveling and purchase more ready-to-eat foods. Although this increase in sales is observable, it is not deemed significant.
The ability to successfully launch new funds competing with much larger financial institutions with greater financial and human capital will be challenging. Regulation USCF Investments’ operating subsidiaries, USCF and USCF Advisers, are subject to federal, state and local laws and regulations generally applicable to the investment services industry.
Regulation USCF Investments’ operating subsidiaries, USCF LLC and USCF Advisers, are subject to certain federal, state and local laws and regulations generally applicable to the investment services industry.
Brigadier has demonstrated a commitment to delivering outstanding quality to customers by the notable facilities, businesses, and homes they secure. Brigadier is an authorized SecurTek dealer. SecurTek is owned by SaskTel which is Saskatchewan's leading Information and Communications Technology (ICT) provider with over 1.4 million customer connections across Canada.
SecurTek is owned by SaskTel, Saskatchewan’s leading Information and Communications Technology (ICT) provider with over 1.4 million customer connections across Canada.
Located in nearby Napier, New Zealand, Printstock prints wrappers for food products, including those used by Gourmet Foods. Printstock is a wholly-owned subsidiary of Gourmet Foods and its operating results are consolidated with those of Gourmet Foods from July 1, 2020 onwards.
In 2020, Gourmet Foods acquired Printstock Products Limited (“Printstock”), a Flexographic printing company based in Napier, New Zealand that prints specialty wrappers for the food industry in Australia and New Zealand including those used by Gourmet Foods. Printstock’s operating results are consolidated with those of Gourmet Foods.
Gourmet Foods is focused on securing the best prices available for raw materials in the local market and recruiting experienced staff to replace those persons who failed to return to the workplace after the lifting of the COVID-19 restrictions during the current fiscal year. 7 Table of Contents Competition Gourmet Foods faces competition from other commercial-scale manufacturers of meat pies located in New Zealand and Australia.
Gourmet Foods is focused on securing the best prices available for raw materials in the local market and recruiting experienced staff. 6 Table of Contents Competition Gourmet Foods competes with other commercial-scale manufacturers of meat pies in New Zealand and Australia. Competitors’ products may be more effective, or more effectively marketed and sold, than products Gourmet Foods may commercialize.
The Company’s corporate management is responsible for capital allocation decisions, investment activities and selection and retention of the Chief Executive to head each of the operating subsidiaries. The Company’s executive management is also responsible for corporate governance practices, monitoring regulatory affairs, including those of its operating businesses and involvement in governance-related issues of its subsidiaries as needed.
Our executive management is also responsible for organizational accountability, corporate governance practices, monitoring regulatory affairs, including those of our operating businesses and involvement in governance-related issues of its subsidiaries as needed. We were incorporated in the state of Nevada on January 26, 2000. Our corporate headquarters are located in San Clemente, California.
Brigadier On June 2, 2016, we acquired all of the issued and outstanding stock in Brigadier, a Canadian corporation headquartered in Saskatoon, Saskatchewan. Brigadier sells and installs alarm monitoring and security systems to commercial and residential customers under the brand names "Brigadier Security Systems" and "Elite Security" throughout the province of Saskatchewan with offices in Saskatoon and Regina.
Brigadier has two hubs, one in Regina (Elite Security) and one in Saskatoon (Brigadier Security), in the Canadian Province of Saskatchewan. Brigadier sells and installs alarm monitoring, access controls, ULC approved fire monitoring panels, and security systems to commercial and residential customers under the brand names “Brigadier Security Systems” and “Elite Security” throughout the Province of Saskatchewan.
The Funds for which USCF is a general partner or sponsor have registered trademarks owned by USCF. Additionally, USCF was granted two patents Nos. 7,739,186 and 8,019,675, for systems and methods for an exchange traded fund (ETF) that tracks the price of one or more commodities. 6 Table of Contents Gourmet Foods Gourmet Foods, Ltd.
USCF LLC was granted two patents Nos. 7,739,186 and 8,019,675 by the PTO for systems and methods for an exchange traded fund (ETF) that track the price of one or more commodities. 5 Table of Contents Litigation Please refer to “Note 14. Commitments and Contingencies – Litigation” to the financial statements included in this Form 10-K.
Competition USCF Investments faces competition from other commodity fund managers, which include larger, better financed companies that offer products similar to USCF Investments. Many of these competitors have substantially greater financial, technical, and human resources than USCF Investments does, as well as greater experience in the discovery and development of products and the commercialization of those products.
Many of these competitors have substantially greater technical and human resources than USCF Investments does, as well as greater experience in the discovery, research and development of products and the commercialization of those products. Our competitors’ products may have better performance or are more effectively marketed and sold, than any products we may commercialize.
Gourmet Foods, located in Tauranga, New Zealand, sells substantially all of its goods to supermarkets and service station chains with stores located throughout New Zealand.
Gourmet Foods manufactures wholesale bakery products, meat pies, patisserie cakes and slices on a commercial scale under brand names Ponsonby Pies and Pats Pantry and distributes substantially all of its goods to supermarkets and service station chains with stores located throughout New Zealand.
Marygold UK is also planning to introduce the Marygold fintech app to its customers and, more broadly, to the population of the U.K. as the mobile app finalizes its commercial launch in the U.S. and banking relationships are established in the U.K.
Marygold UK is planning to introduce the Marygold Fintech app to its customers and, more broadly, in the U.K. within the coming fiscal year. Marygold UK employs nine persons full time in the U.K.
Sales to the largest customer, which includes contracts and recurring monthly support fees, totaled 42% and 52% of the total Brigadier revenues for the years ended June 30, 2023 and June 30, 2022, respectively.
Sales to its largest customer, which includes contracts and recurring monthly support fees, were 42% of Brigadier’s total revenue for each of the years ended June 30, 2024 and 2023. Sources and Availability of Materials Brigadier purchases alarm panels, digital and analog cameras, mounting hardware and accessory items needed to complete security installations from a variety of sources.
Brigadier specializes, and is certified, in several major manufacturers’ products: Honeywell Security, Panasonic, Avigilon and JCI/DSC/Kantech security products. Brigadier and its staff are recognized for dedication to customer service with annual awards from SecurTek including being recipients of the Customer Retention, Service Excellence, and overall best dealer with the President’s Award.
Its experience as the provider of choice for many large notable sites shows a commitment to design, service and support. Brigadier specializes and is certified to offer several major manufacturers’ products, including: Honeywell Security, Panasonic, Avigilon and JCI/DSC/Kantech security products. Brigadier is an authorized SecurTek dealer.
Across the Company and its subsidiaries the Company employs 101 people. Subsidiary Business Overview USCF Investments On December 9, 2016, we acquired all of the issued and outstanding stock in USCF Investments.
Subsidiary Business Overview Fund Management - USCF Investments In 2016, we acquired all of the issued and outstanding stock in USCF Investments , Inc. (“USCF Investments”). USCF Investments is a U.S. corporation organized in the state of Delaware.
In an effort to expand its market presence and limit competitive interference, Gourmet Foods from time to time attempts to acquire other commercial-scale manufacturers of meat pies or confections. Gourmet Foods has also collapsed a portion of its supply chain by acquiring Printstock, who prints the food wrappers utilized by Gourmet Foods.
Gourmet Foods has also improved a portion of its supply chain by acquiring Printstock, which prints the food wrappers utilized by Gourmet Foods. Printstock, in turn, also faces competition from other New Zealand-based printing companies who offer similar services to the food production industry.
Marygold employs six full time staff members and also subcontracts for a variety of services, both in the U.S. and internationally. These operating expenses are combined with those of The Marygold Companies in our Consolidated Financial Statements and segmented reports. Marygold launched its mobile app in June 2023 and thus had insignificant operations during the current year.
The underlying code compiled in its mobile banking app and other custom programs are proprietary and trade secrets of Marygold. Employees Marygold employs nine full time staff members, a varying number of independent contractors, and also subcontracts for a variety of services, both in the U.S. and internationally.
Removed
ITEM 1. BUSINESS. General The Marygold Companies, Inc., (the “Company” or "The Marygold Companies"), a Nevada corporation, operates through its wholly owned subsidiaries who are engaged in varied business activities. The operations of the Company’s wholly owned subsidiaries are more particularly described herein but are summarized as follows: ● USCF Investments, Inc.
Added
BUSINESS The Marygold Companies, Inc., a Nevada corporation (together with its subsidiaries, “we,” “us,” “our,” “Company,” or “The Marygold Companies), is a holding company which operates through its wholly owned subsidiaries engaged in certain diverse business activities listed below: ● Fund Management - USCF Investments, Inc., a Delaware corporation (“USCF Investments”), with corporate headquarters in Walnut Creek, California and its wholly-owned subsidiaries: ○ United States Commodity Funds, LLC, a Delaware limited liability company (“USCF LLC”), and ○ USCF Advisers, LLC, a Delaware limited liability company (“USCF Advisers”).
Removed
(“USCF Investments”), a U.S. based company, is the sole member of two investment services limited liability company subsidiaries that manages, operates or is an investment advisor to exchange traded funds organized as limited partnerships or investment trusts that issue shares which trade on the NYSE Arca stock exchange. ● Gourmet Foods, Ltd., a New Zealand based company, manufactures and distributes New Zealand meat pies on a commercial scale and its wholly-owned New Zealand subsidiary company, Printstock Products Limited, prints specialty wrappers for the food industry in New Zealand and Australia.
Added
The principal place of business for each of USCF LLC and USCF Advisers is in Walnut Creek, California. ● Food Products – Gourmet Foods, Ltd., a registered New Zealand company located in Tauranga, New Zealand and its wholly-owned subsidiary, Printstock Products Limited, a registered New Zealand company, with is principal manufacturing facility in Napier, New Zealand. ● Security Systems – Brigadier Security Systems (2000) Ltd., a Canadian registered corporation, with locations in Regina and Saskatoon, Saskatchewan, Canada. ● Beauty Products - Kahnalytics, Inc., a California corporation, doing business as “Original Sprout,” located in San Clemente, California. ● Financial Services – United States and Great Britain: ○ Marygold & Co., a Delaware corporation, based in Denver, Colorado, and its wholly-owned subsidiary, Marygold & Co.
Removed
(collectively "Gourmet Foods") ● Brigadier Security Systems (2000) Ltd.
Added
Advisory Services, LLC, a Delaware limited liability company, whose principal business office is in New Albany, Ohio; ○ Marygold & Co., (UK) Limited, a private limited company incorporated and registered in England and Wales, whose registered office is in London, England, and its wholly-owned subsidiaries: ■ Tiger Financial & Asset Management Limited, a company incorporated and registered in England and Wales, whose registered office is in Northampton, England; and ■ Step-By-Step Financial Planners Limited, a company incorporated and registered in England and Wales, whose registered office is in Staffordshire, England.
Removed
(“Brigadier”), a Canadian based company, sells and installs commercial and residential alarm monitoring systems. ● Kahnalytics, Inc. dba/Original Sprout (“Original Sprout”), a U.S. based company, is engaged in the wholesale distribution of hair and skin care products under the brand name Original Sprout on a global scale. ● Marygold & Co., a newly formed U.S. based company, together with its wholly-owned limited liability company, Marygold & Co.
Added
Our executive management team is primarily responsible for vision and strategy of the Company while effectively implementing capital allocation decisions, investment activities, leadership talent selection, development, performance and retention of the management executives to head each of the operating subsidiaries.
Removed
Advisory Services, LLC, (collectively "Marygold") was established by The Marygold Companies to explore opportunities in the financial technology ("Fintech") space, completed its development phase in June 2023, and launched its commercial services in June 2023. Through June 30, 2023, expenditures have been limited to developing the business model and the associated application development. ● Marygold & Co.
Added
Human capital and resources are an integral part of our businesses. Our business units employed 116 people located in various parts of the world such as, New Zealand, Canada, Great Britain and the United States through the fiscal year ended June 30, 2024.
Removed
(UK) Limited, a newly formed U.K. limited company, together with its newly acquired UK subsidiary, Tiger Financial and Asset Management, Ltd. (collectively “Marygold UK”) is an asset manager and registered investment advisor in the UK. Operations are included in these consolidated financial statements beginning on the acquisition date of June 20, 2022.
Added
This includes all full and part-time employees as well as executives at our corporate headquarters in San Clemente, California. Consistent with our decentralized management philosophy, our operating business units individually establish competitive compensation packages to attract, retain and reward people within their organizations.
Removed
USCF Investments wholly owns both USCF and USCF Advisers, which collectively operate 14 exchange traded products (“ETPs”) and exchange traded funds (“ETFs”), each of which has its shares listed on the NYSE Arca, Inc. ("NYSE Arca").
Added
Given the varied business activities, our business units have policies and practices to address, among other things, maintaining a safe working environment, eliminating workplace harm, both mental and physical, providing various health and retirement benefits, as well as incentives to recognize and reward performance on an individual and company goal performance basis.
Removed
The ETPs and ETFs managed by USCF and USCF Advisers have a total of approximately $3.5 billion in assets under management as of June 30, 2023. USCF Investments receives revenues as a result of its ownership of USCF and USCF Advisers, which provides investment management and advisory services in exchange for management fees charged against the ETPs and ETFs.
Added
USCF Investments is the parent and sole member of two fund management limited liability companies formed in the state of Delaware: United States Commodity Funds, LLC (“USCF LLC”) and USCF Advisers, LLC (“USCF Advisers”). USCF LLC and USCF Advisers are each registered as a commodity pool operator, and each is a member of the National Futures Association.
Removed
The ETPs and ETFs managed by USCF and USCF Advisers invest in a broad base index or single commodity, particularly in oil, natural gas, gasoline and metals.
Added
USCF LLC and USCF Advisers, together with USCF Investments will be referred to hereafter as “USCF Investments.” USCF LLC and USCF Advisers provide investment fund management and advisory services and receive management and/or investment advisory fees for providing such services to each of the ETFs it manages.
Removed
Our competitors’ products may be more effective, or more effectively marketed and sold, than any products we may commercialize. USCF Investments will continue to develop and consider new fund opportunities identified through its research efforts and review of market needs. However, the cost of launching and seeding new funds is dependent upon existing and new capital resources.
Added
Currently, USCF LLC and USCF Advisers collectively manage and service 16 exchange traded funds (“ETFs”), the shares or other interests of which are listed and traded on the NYSE Arca, Inc. (“NYSE Arca”). The ETFs managed by USCF LLC and USCF Advisers have a combined total of $2.9 billion in assets under management (“AUM”) as of June 30, 2024.
Removed
USCF Investments, through its operating subsidiaries, bears all of its own costs associated with providing these advisory services and the expenses of the members of the board of directors of each fund who are affiliated with USCF Investments. Intellectual Property USCF Investments subsidiary USCF owns registered trademarks for USCF and USCF Advisers.
Added
USCF Investments’ subsidiaries each earn monthly management and advisory fees based on its agreements with each fund. The management fees for a fund are determined on the basis of the percentage management fee structure for such fund as forth in its advisory agreement with the fund multiplied by the average AUM of such fund over a given period.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

42 edited+51 added−13 removed49 unchanged
Biggest changeThese factors may include, among other thing, results of operations that vary from the expectations of securities analysts and investors; changes in expectations as to our or our industry's future financial performance, including financial estimates and investment recommendations by securities analysts and investors, and the publication of research reports regarding the same; 14 Table of Contents ● changes in general economic or market conditions or trends in our industry or markets; future issuances or sales or purchases of our common stock or other securities; ● the public's response to press releases or other public announcements by us or third parties, including our filings with the SEC; duck ● changes in senior management or other key personnel.
Biggest changeThe market price of our shares of common stock could be subject to wide fluctuations in response to many risk factors and many beyond our control, including: ● results of operations that vary from the expectations of securities analysts and investors ● changes in expectations as to our or our industries’ future financial performance, including financial estimates and investment recommendations by securities analysts and investors, and ● the publication of new or updated research reports by securities analysts; ● the public’s response to press releases or other public announcements by us or third parties, including our filings with the SEC; ● changes in our senior management or other key personnel; ● results and timing of our product development, including related to our Fintech app; ● share price and volume fluctuations attributable to inconsistent trading volume levels of our shares; ● litigation or regulatory action regarding our products or services, including litigation related to our investment advisory services and ETFs; ● disputes or other developments related to our proprietary rights, including patents, litigation matters, and our ability to obtain, maintain, defend or enforce proprietary rights relating to our products or technologies; ● sales of our shares by us, our insiders, or other stockholders; ● actual or anticipated fluctuations in our competitors’ operating results or changes in their growth rates; ● in the event our cash flows are insufficient to fund our operations, our ability to raise additional financing, including in connection with the development of our Fintech product or the acquisition of additional businesses; ● changes in general economic or market conditions or trends in our industries or markets; future issuances or sales or purchases of our common stock or other securities.
Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages, are in the early stages of the proceedings, and are subject to appeal.
Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages, are in the early stages of proceedings, and are subject to appeal.
Any of these risks could materially affect our results of operations and consolidated financial results. Future acquisitions or business opportunities could involve unknown risks that could harm our business and adversely affect our financial condition and results of operations. We are a holding company that owns interests in a number of different businesses.
Any of these risks could materially affect our consolidated results of operations and financial condition. Future acquisitions or business opportunities could involve unknown risks that could harm our business and adversely affect our financial condition and results of operations. We are a holding company that owns interests in a number of different businesses.
If the makeup of one or more of our board, nomination and governance committee or compensation committee changes such that we no longer comply with the independence standard of the NYSE American guidelines, then our stockholders may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the NYSE American rules.
If the makeup of one or more of our board, audit, nomination and governance committee or compensation committee changes such that we no longer comply with the independence standard of the NYSE American guidelines, then our stockholders may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the NYSE American rules.
Risks Related to Our Controlled Company Election and Status We are a " controlled company " within the meaning of the NYSE American rules and rely on exemptions from various corporate governance requirements that provide protection to stockholders of other companies.
Risks Related to Our Controlled Company Election and Status We are a “ controlled company ” within the meaning of the NYSE American rules and rely on exemptions from various corporate governance requirements that provide protection to stockholders of other companies.
We derive a substantial portion of our revenues from our USCF Investments subsidiary, as a result, our operating results are particularly exposed to investor sentiment toward investing in the ETPs and ETFs sponsored by USCF and advised by USCF Advisers.
We derive a substantial portion of our revenues from our USCF Investments subsidiary and, as a result, our operating results are particularly exposed to investor sentiment toward investing in the ETFs sponsored by USCF and advised by USCF Advisers.
The ability of our subsidiaries to distribute cash to us are and will remain subject to, among other things, restrictions that are contained in each subsidiaries’ financing agreements, availability of sufficient funds and applicable state laws and regulatory restrictions.
The ability of our subsidiaries to distribute cash to us are and will remain subject to, among other things, restrictions that are contained in each subsidiaries’ financing agreements, availability of sufficient funds and applicable laws and regulatory restrictions.
Gerber share power to vote or to direct the vote of the shares and share power to dispose or to direct the disposition of Common Stock beneficially owned or controlled by Mr. Gerber. Mr. Scott Schoenberger is a member of the Board of the Company. Mr.
Gerber share power to vote or to direct the vote of the shares and share power to dispose or to direct the disposition of Common Stock beneficially owned or controlled by Mr. Gerber. Mr. Scott Schoenberger is a member of the Board of Directors of the Company. Mr.
In addition, our financial condition, results of operations and the ability to service our debt may be adversely impacted depending on the specific risks applicable to any business we invest in or acquire and our ability to address those risks. 16 Table of Contents We could consume resources in researching acquisitions, business opportunities or financings and capital market transactions that are not consummated, which could materially adversely affect subsequent attempts to locate and acquire or invest in another business.
In addition, our financial condition, results of operations and the ability to service our debt may be adversely impacted depending on the specific risks applicable to any business we invest in or acquire and our ability to address those risks. 15 Table of Contents We could consume resources in researching acquisitions, business opportunities or financings and capital market transactions that are not consummated, which could materially adversely affect subsequent attempts to locate and acquire or invest in another business.
These independence standards are intended to ensure that directors who meet those standards are free of any conflicting interest that could influence their actions as directors. 15 Table of Contents The Company may elect in the future to use certain of these controlled company exemptions and the Company may continue to use all or some of these exemptions in the future for so long as the Company is a controlled company.
These independence standards are intended to ensure that directors who meet those standards are free of any conflicting interest that could influence their actions as directors. 14 Table of Contents The Company may elect in the future to use certain of these controlled company exemptions and the Company may continue to use all or some of these exemptions in the future for so long as the Company is a controlled company.
We are a "controlled company" as defined in section 801(a) of the NYSE American Company Guide because more than 50% of the combined voting power of all of our outstanding common stock is beneficially owned or controlled by Messrs. Gerber and Schoenberger.
We are a “controlled company” as defined in section 801(a) of the NYSE American Company Guide because more than 50% of the combined voting power of all of our outstanding common stock is beneficially owned or controlled by Messrs. Gerber and Schoenberger.
Schoenberger's shares of Common Stock are held by the Schoenberger Family Trust (the "Schoenberger Trust"). Mr. Schoenberger serves as the sole trustee of the Schoenberger Trust; As such, the Schoenberger Trust and Mr. Schoenberger share power to vote or to direct the vote of the shares and share power to dispose or to direct the disposition of these shares.
Schoenberger’s shares of Common Stock are held by the Schoenberger Family Trust (the “Schoenberger Trust”). Mr. Schoenberger serves as the sole trustee of the Schoenberger Trust. As such, the Schoenberger Trust and Mr. Schoenberger share power to vote or to direct the vote of the shares and share power to dispose or to direct the disposition of these shares.
This could result in limited growth or a reduction in the overall ETP market and result in our revenues not growing as rapidly as it has in the recent past or even in a reduction of revenues.
This could result in limited growth or a reduction in the overall ETP market and result in our revenue not growing as rapidly as it has in the recent past or even in a reduction of revenue.
Shares of our Common Stock held by Schoenberger Trust total 4,697,993 shares, representing 11.64% of the outstanding shares of Common Stock (giving effect to the conversion of all Series B Preferred Stock).
Shares of our Common Stock held by Schoenberger Trust total 4,697,993 shares, representing 11.6% of the outstanding shares of Common Stock (giving effect to the conversion of all Series B Preferred Stock).
Additionally, pursuant to a voting agreement, (the "Voting Agreement"), the Gerber Trust and Schoenberger Trust will continue to vote all shares of Voting Stock owned by them to elect each of Messrs. Gerber and Schoenberger to the Board along with other designees mutually agreed upon. By virtue of the Voting Agreement, Messrs.
Additionally, pursuant to a voting agreement (“Voting Agreement”), the Gerber Trust and Schoenberger Trust will continue to vote all shares of our voting stock owned by them to elect each of Messrs. Gerber and Schoenberger to the Board along with other designees mutually agreed upon. By virtue of the Voting Agreement, Messrs.
Mr. Gerber's Common Stock is held by the Nicholas and Melinda Gerber Living Trust (the "Gerber Trust"). Nicholas Gerber and Melinda Gerber serve as trustees of the Gerber Trust; As such, the Gerber Trust and Mr.
Mr. Gerber’s Common Stock is held by the Nicholas and Melinda Gerber Living Trust (the “Gerber Trust”). Nicholas Gerber and Melinda Gerber serve as trustees of the Gerber Trust. As such, the Gerber Trust and Mr.
Under the NYSE American rules, a company of which more than 50% of the voting power is held by another person or group of persons acting together is a controlled company and may elect not to comply with certain NYSE American corporate governance requirements, including the requirements that: ● A majority of the Company's Board of Directors consist of independent directors; ● the Company has a nominating committee that is composed entirely of independent directors with a written charter addressing the committee's purpose and responsibilities; duck ● the Company has a compensation committee that is composed entirely of independent directors with a written charter addressing the committee's purpose and responsibilities.
Under the NYSE American rules, a company of which more than 50% of the voting power is held by another person or group of persons acting together is a controlled company and may elect not to comply with certain NYSE American corporate governance requirements, including the requirements that: ● a majority of the Company’s Board of Directors consist of independent directors; ● the Company has an audit committee that is comprised of a minimum of three (3) independent directors with a written charter addressing the committee’s purpose and responsibilities; ● the Company has a nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; ● the Company has a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
The principal source of cash flow is distributions from our subsidiaries. Thus, our ability to finance future acquisitions or develop new projects is dependent on the ability of our subsidiaries to generate sufficient net income and cash flows to make upstream cash distributions to us.
Thus, our ability to finance future acquisitions or develop new projects is dependent on the ability of our subsidiaries to generate sufficient net income and cash flows to make upstream cash distributions to us.
In light of the inherent uncertainties involved in such matters, an adverse outcome in this litigation could materially adversely affect the Company’s financial condition, results of operations or cash flows in any particular reporting period. 11 Table of Contents Litigation could result in substantial costs and divert management’s attention and resources from a company’s business.
In light of the inherent uncertainties involved in such matters, an adverse outcome in this litigation could materially adversely affect our financial condition, results of operations or cash flows in any particular reporting period. Litigation could result in substantial costs and divert management’s attention and resources from our business.
Additionally, litigation could give rise to perceived uncertainties as to a company’s future, adversely affect its relationships with vendors and make it more difficult to attract and retain qualified personnel. Also, a company subject to litigation may be required to incur significant legal fees and other expenses related to any litigation.
Additionally, litigation could give rise to perceived uncertainties as to our future, adversely affect our relationships with investors in our funds, customers and vendors and make it more difficult to attract and retain qualified personnel. Also, a company subject to litigation may be required to incur significant legal fees and other expenses related to any litigation.
For the years ended June 30, 2023 and 2022, approximately 60% and 63% of our revenues, respectively, were derived from USCF Investments operations, which consists of the management of ETPs and ETFs by USCF and USCF Advisers.
For the years ended June 30, 2024 and 2023, 58% and 60% of our revenues, respectively, were derived from USCF Investments operations, which consists of the management of ETPs and ETFs by USCF and USCF Advisers.
Gerber, the President and Chief Executive Officer of the Company and Chairman of the Board of the Company, is the beneficial owner of approximately 18,250,015 shares of our common stock, par value $0.001 per share (the "Common Stock"), representing approximately 45.21% of our total issued and outstanding Common Stock (giving effect to the conversion of all Series B Preferred Stock) .
Gerber, the President and Chief Executive Officer of the Company and Chairman of the Board of the Company, is the beneficial owner of 18,418,766 shares of our common stock, par value $0.001 per share (the “Common Stock”), representing approximately 45.6% of our total issued and outstanding Common Stock (giving effect to the conversion of all Series B Preferred Stock) .
As a result, The Marygold Companies ’ principal source of cash flow is distributions from its subsidiaries and its subsidiaries may be limited by law and by contract in making distributions to The Marygold Companies. As a holding company, The Marygold Companies’ assets are its cash and cash equivalents, the equity interests in its subsidiaries and other investments.
Our subsidiaries may be limited by law and by contract from making distributions to us. As a holding company, our assets are cash and cash equivalents, equity interests in our subsidiaries and our other investments. The principal source of our cash flow is distributions from our subsidiaries.
In the past, we have expanded our business internationally. This expansion subjects us to increased operational, regulatory, financial and other risks. We face increased operational, regulatory, financial, compliance, reputational and foreign exchange rate risks as a result of our international expansion.
This expansion subjects us to increased operational, regulatory, financial and other risks. We face increased operational, regulatory, financial, compliance, reputational and foreign exchange rate risks as a result of our international expansion.
Moreover, even if a product liability or fraud claim is unsuccessful, has no merit, or is not pursued to conclusion, the negative publicity surrounding assertions against our products or processes could materially and adversely affect our product sales, financial condition, and operating results.
Moreover, even if a product liability or fraud claim is unsuccessful, has no merit, or is not pursued to conclusion, the negative publicity surrounding assertions against our products or processes could materially and adversely affect our product sales, financial condition, and operating results. 13 Table of Contents In the past, we have expanded our business internationally.
Although we may rely on NYSE American's controlled company exemptions in the future, we currently have an independent board, nomination and governance committee and compensation committee.
Although we may rely on NYSE American’s controlled company exemptions in the future, we currently have a board comprised of a majority of independent directors, audit committee, nomination and governance committee and compensation committee.
For these reasons, we are currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from, the matters described in “Item 3. Legal Proceedings” of this Annual Report on Form 10-K.
For these reasons, we are currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from, the matters described in “Item 3. Legal Proceedings” of this Form 10-K and “Note 14. Commitments and Contingencies – Legal Proceedings” to our consolidated financial statements included in this Form 10-K.
If our proprietary information is divulged to third parties, including our competitors, or our intellectual property rights are otherwise misappropriated or infringed, our business could be harmed or adversely affected.
If our proprietary information is divulged to third parties, including our competitors, or our intellectual property rights are otherwise misappropriated or infringed, our business could be harmed or adversely affected. Legal, Compliance and Regulatory Risks Our business is subject to extensive government regulation and oversight.
Any such event could consume significant management time and result in a loss to us of the related costs incurred, which could adversely affect our financial position and our ability to consummate other acquisitions and investments. We may fail to effectively integrate the businesses we acquire. Historically, a portion of our growth has come through acquisitions.
Any such event could consume significant management time and result in a loss to us of the related costs incurred, which could adversely affect our financial position and our ability to consummate other acquisitions and investments.
The Company ’ s business and operation could be negatively affected by any material litigation involving the Company or its subsidiaries. USCF, an indirect wholly-owned subsidiary of the Company, is currently subject to class action litigation. See “Item 3. Legal Proceedings” of this Annual Report on Form 10-K.
Litigation Risks The Company ’ s business and operation could be negatively affected by any material litigation involving the Company or its subsidiaries. USCF LLC, an indirect wholly-owned subsidiary, is currently the subject of class action litigation. See “Note 14. Commitments and Contingencies - Legal Proceedings” to our consolidated financial statements included in this Form 10-K.
We have implemented policies and procedures designed to help ensure compliance with applicable laws and regulations, but there can be no assurance that our employees, contractors, and agents will not violate such laws and regulations. We are dependent on certain key personnel, the loss of which may adversely affect our financial condition or results of operations.
We have implemented policies and procedures designed to help ensure compliance with applicable laws and regulations, but there can be no assurance that our employees, contractors, and agents will not violate such laws and regulations.
Risks Related to our Business and Structure The Marygold Companies is a holding company and its only material assets are its cash in hand, equity interests in its operating subsidiaries and its other investments.
Risks Related to our Business and Structure We are a holding company, and our only material assets are our cash in hand, equity and other interests in our operating subsidiaries, and our other investments. As a result, our principal sources of cash flow are distributions from our subsidiaries.
If we are unable to integrate acquired businesses successfully or realize anticipated synergies in a timely manner, our business and results of operations may be adversely affected. Integrating acquired businesses may be more difficult in a region or market where we have limited expertise.
We may fail to effectively integrate the businesses we acquire. Historically, a portion of our growth has come through acquisitions. If we are unable to integrate acquired businesses successfully or realize anticipated synergies in a timely manner, our business and results of operations may be adversely affected.
Our stock price may change significantly, and you may not be able to sell your shares of our common stock at or above the price you paid or at all, and you could lose all or part of your investment as a result. The stock market may routinely experience periods of large or extreme volatility.
Any of these factors or the expiration, termination, or invalidity of one or more of our patents may have a material adverse effect on our business. 16 Table of Contents Risks Related to Ownership of Our Shares Our stock price may change significantly, and you may not be able to sell your shares of our common stock at or above the price you paid or at all, and you could lose all or part of your investment as a result.
To the extent our cash flow is dependent on our subsidiaries ability to make distributions to us could materially limit our ability to grow, pursue business opportunities or make acquisitions that could be beneficial to our businesses. 12 Table of Contents Our business is subject to extensive government regulation and oversight.
To the extent our cash flow is dependent on our subsidiaries ability to make distributions to us could materially limit our ability to grow, pursue business opportunities or make acquisitions that could be beneficial to our businesses, including in connection with the development of our Fintech app. 11 Table of Contents We are dependent on certain key personnel, the loss of which may adversely affect our financial condition or results of operations.
Our subsidiaries require qualified and competent personnel to execute their business plans and continue servicing their clients, suppliers and other stakeholders. Our inability to attract and retain qualified personnel to operate our business subsidiaries could negatively impact our operating results and our overall financial condition that is important to our success and future growth.
Our subsidiaries require qualified and competent personnel to execute their business plans and continue servicing their clients, suppliers and other stakeholders.
A significant expansion of our business and operations, in terms of geography or magnitude, could strain our administrative and/or operational resources. Significant acquisitions may also require incurring debt. This could increase our interest expense and make it difficult for us to obtain financing for other significant acquisitions or capital investments in the future.
Integrating acquired businesses may be more difficult in a region or market where we have limited expertise. A significant expansion of our business and operations, in terms of geography or magnitude, could strain our administrative and/or operational resources. Significant acquisitions may also require incurring debt.
In some instances, this volatility is unrelated or disproportionate to the operating performance of particular companies. ● The trading price of our common stock may be adversely affected due to a number of factors, many of which we cannot control.
The stock market may routinely experience periods of large or extreme volatility. In some instances, this volatility is unrelated or disproportionate to the operating performance of particular companies.
Gerber has a relatively higher number of votes relative to other directors, in proportion to Mr. Gerber’s ownership interest in the Company. Cyber Security Risks The efficient operation of our businesses is dependent on computer hardware and software systems.
Gerber has a relatively higher number of votes relative to other directors, in proportion to Mr. Gerber’s ownership interest in the Company. General Business Risks Our business and financial performance may be adversely affected by information systems interruptions, cybersecurity attacks or other disruptions which could have a material adverse effect on our business and results from operations.
Additional risks and uncertainties that are presently unknown or are currently deemed immaterial may also impair our business operations. The following risk factors should be read in connection with the other information included in this annual report on Form 10-K, including Management’s Discussion and Analysis of Financial Condition and Results of Operations and our financial statements and the related notes.
Additional risks and uncertainties that are presently unknown or are currently deemed immaterial may also impair our business operations. If any of the events or circumstances described in the following risks occur, our business, financial condition and results of operations could suffer and the trading price of our shares of common stock could decline.
Sovereign debt downgrades, defaults, inability to access debt markets due to credit or legal constraints, liquidity crises, the breakup or restructuring of fiscal, monetary, or political systems such as the European Union, and other events or conditions that impair the functioning of financial markets and institutions also may adversely impact the demand for crude oil. 13 Table of Contents Abnormally wide bid/ask spreads and market disruptions that halt or disrupt trading or create extreme volatility could undermine investor confidence in the ETP investment structure and limit investor acceptance of ETPs.
Our inability to attract and retain qualified personnel to operate our business subsidiaries could negatively impact our operating results and our overall financial condition that is important to our success and future growth. 12 Table of Contents Abnormally wide bid/ask spreads and market disruptions that halt or disrupt trading or create extreme volatility could undermine investor confidence in the ETP investment structure and limit investor acceptance of ETPs.
COVID-19 Risk The Company may be impacted by certain continuing aftereffects from the economic disruption imposed by the COVID-19 pandemic, which was first detected in China in December 2019 and declared a pandemic by the World Health Organization in March 2020.
This could increase our interest expense and make it difficult for us to obtain financing for other significant acquisitions or capital investments in the future. COVID-19 Risk The Company may be impacted by certain continuing aftereffects from the economic disruption imposed by the COVID-19 pandemic.
Removed
ITEM 1A. RISK FACTORS The Marygold Companies and its subsidiaries (referred to herein as “we,” “us,” “our” or similar expressions) are subject to certain risks and uncertainties in its business operations which are described below. The risks and uncertainties described below are not the only risks we face.
Added
ITEM 1A. RISK FACTORS Our business operations, financial condition, results of operations, and stock price may be affected by a number of factors.
Removed
Risks related to commodity prices could materially and adversely affect USCF ’ s business. In 2020, in the context of the COVID-19 pandemic and disputes among oil-producing countries regarding potential limits on the production of crude oil, significant market volatility occurred and is continuing in the crude oil markets as well as the oil futures markets.
Added
In addition to the other information in this Annual Report on Form 10-K (“Form 10-K”), the following factors and the information contained under “Special Note Regarding Forward-Looking Statements” should be considered in evaluating our company and our businesses. The risks and uncertainties described below are not the only risks we face.
Removed
As a result of this, significant market volatility in the oil futures markets, the market price of the front month futures contract fell below zero for a period of time. Crude oil prices also vary depending on a number of factors affecting supply.
Added
Gerber and Schoenberger are entitled to 23,116,759 votes on matters submitted to our stockholders, or 57.3% of all votes on matters submitted to our stockholders for their approval.
Removed
For example, increased supply from the development of new oil supply sources and technologies to enhance recovery from existing sources tends to reduce crude oil prices to the extent such supply increases are not offset by commensurate growth in demand. Similarly, increases in industry refining or petrochemical manufacturing capacity may impact the supply of crude oil.
Added
We depend upon information technology, infrastructure, including network, hardware and software systems to conduct our businesses.
Removed
World oil supply levels can also be affected by factors that reduce available supplies, such as adherence by member countries to the Organization of the Petroleum Exporting Countries ("OPEC") production quotas and the occurrence of wars, hostile actions, natural disasters, disruptions in competitors' operations, or unexpected unavailability of distribution channels that may disrupt supplies.
Added
Despite our implementation of security measures, there are numerous and evolving risks to cybersecurity and privacy, including risks originating from intentional acts of criminal hackers, nation states and competitors, intentional and unintentional acts or omissions of customers, vendors, contractors, employees and other third parties that may result in damage, breakdown, or interruption from computer viruses, ransomware, malware, phishing, social engineering, fraudulent inducement, electronic fraud, wire fraud, human error or malfeasance, unauthorized access, natural disasters, and telecommunications and electrical failures.
Removed
Technological change can also alter the relative costs for companies in the petroleum industry to find, produce, and refine oil and to manufacture petrochemicals, which in turn may affect the supply of and demand for oil. The demand for crude oil also correlates closely with general economic growth rates.
Added
Each of our businesses directly or indirectly store, collect and transmit sensitive data, including intellectual property, confidential information, proprietary business information, customer or personal data. The secure processing of such data, maintenance, and transmission of such data is important to our operations. We face increased cybersecurity risks due to our reliance on internet technology.
Removed
The occurrence of recessions or other periods of low or negative economic growth will typically have a direct adverse impact on crude oil prices.
Added
We may not be able to anticipate all types of security threats or be able to implement security measures effective against all such threats or implement preventive measures effective against all such threats. The techniques used by cybercriminals change frequently and may not be recognized until launched and can originate from a wide variety of sources, as discussed above.
Removed
Other factors that affect general economic conditions in the world or in a major region, such as changes in population growth rates, periods of civil unrest, pandemics (including COVID-19), government austerity programs, or currency exchange rate fluctuations, can also impact the demand for crude oil.
Added
Even if identified, we may not be able to adequately investigate or remediate incidents or breaches due to attacks increasingly using tools and techniques that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.
Removed
Gerber and Schoenberger will represent 22,948,008, or 56.84% of the Voting Stock with respect to matters that may have a material impact on Company strategy and shareholder rights.
Added
Accordingly, our data protection efforts and related security measures may not be adequate to protect against highly targeted sophisticated cyber-attacks, or other improper disclosures of confidential and/or sensitive information.
Removed
Unauthorized computer infiltration, denial-of-service attacks, phishing efforts, unauthorized access, malicious software codes, computer viruses or other such harmful computer campaigns may negatively impact our business causing significant disruptions to our business operations.
Added
Additionally, we may have access to confidential or other sensitive information of our customers. suppliers, or services providers which despite our efforts to protect, may be vulnerable to security breaches, theft, or improper disclosure any of which could have a material adverse effect on our competitive position, results of operations, cash flows or financial condition.
Removed
We expect that we may be subject to a cyber-attack in some form or fashion in the future as such attacks become more sophisticated and frequent to all industries and all businesses of every size.
Added
The increase in personnel working remotely during and after the recent pandemic has increased the risk for our and our vendors and suppliers’ security breaches and incidents.
Removed
There can be no assurance that our cyber-security measures and technology will adequately protect us from these and other risks, including external risks such as natural disasters and power outages and internal risks such as insecure coding and human error.
Added
If a security breach or other incident results in the unauthorized access to or use, disclosure, release, or other processing of confidential or proprietary information, we could incur liability and it may be necessary to notify persons, governmental authorities, supervisory bodies, the media and other parties pursuant to privacy and security laws.
Removed
Although we have undertaken steps to prevent and mitigate cyber risks, there is no guarantee that our efforts will prevent cyber-attacks perpetrated against our information systems which could result in loss of assets and critical information, theft of intellectual property or inappropriate disclosure of confidential information and could expose us to remediation costs and reputational damage which could adversely affect our business in ways that cannot be predicted at this time.
Added
Any such access, disclosure or other loss of information could result in legal claims, proceedings, liability under laws that protect the privacy of personal information of our employees or others, and any such event could disrupt our operations, damage our reputation, and cause loss of confidence in us.
Added
Our contracts with our customers, suppliers, or services providers may not contain limitation of liability and there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to privacy, data protection, or data security.
Added
Further, we can give no assurance that our insurance coverage will be adequate or sufficient to cover the financial, legal, business or reputational losses that may result from an interruption or breach of our systems, that such coverage will continue to be available on commercially reasonable terms or at all, or that such coverage will pay future claims.
Added
We may not accurately predict revenue streams while we consume capital resources in acquiring new business opportunities or financings and capital market transactions or maintaining current capital investments which could materially and adversely impact our ability to meet operating expenses and capital requirements. We are a holding company with a business focus on investment management and financial technology industries.
Added
Our entry into financial technology through our Marygold subsidiary launched its fintech app in June 2023 and it is not a mature business. The financial technology industry is heavily occupied with well financed competition with extensive capital resources to fund prolific marketing campaigns of competing fintech apps.
Added
Our resources to fund our business objectives and ongoing operations are dependent on those of our subsidiaries. If a decision is made to finance and continue to make capital investments in our fintech subsidiary there is no guarantee of success and revenue generation. Our ability to predict revenue generation from our subsidiaries may not be accurate from time to time.
Added
Our efforts to continue to make capital investments in our fintech subsidiary could have a detrimental effect on our operations and negatively impact our financial condition or results of operations of our businesses where our ability to accurately predict future revenue generation occurs and this could hinder the ability of our business and our other subsidiaries to effectively compete in the various industries in which we operate.
Added
Our business may be impacted by political events, war, terrorism, public health issues, natural disasters and other circumstances that are not within our control.
Added
War, terrorism, geopolitical uncertainties, public health issues, and other business interruptions have caused and could cause damage or disruption to international commerce and the global economy, and thus could have a material adverse effect on us, our suppliers, and manufacturing vendors.
Added
Our business operations are subject to interruption by natural disasters, fire, power shortages, nuclear power plant accidents, terrorist attacks, and other hostile acts, labor disputes, public health issues, and other events beyond our control.
Added
Such events could decrease demand for our products, make it difficult or impossible for us to make and deliver products or services to our customers, or to receive products from our suppliers, and create delays and inefficiencies in our supply chain.
Added
If major public health issues, including pandemics, arise, we could be adversely affected by more stringent employee travel restrictions, additional limitations in freight services, governmental actions limiting the movement of products between regions, delays in production ramps of new products, and disruptions in the operations of our vendors and suppliers.
Added
In the event of a natural disaster, we could incur significant losses, require substantial recovery time and experience significant expenditures in order to resume operations. Our intellectual property may not be adequately protected.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe Company does not own any other plants or real property. Facilities Administrative offices are co-located in the facility leased by our subsidiary, Original Sprout, whose mailing address is 120 Calle Iglesia, San Clemente, California 92672. Our wholly-owned subsidiary, Brigadier, owns its land and buildings in Saskatoon and rents facilities in Regina, Canada.
Biggest changeFacilities Administrative offices are co-located in the facility leased by Original Sprout, whose mailing address is 120 Calle Iglesia, San Clemente, California 92672. Brigadier owns its land and buildings in Saskatoon and rents facilities in Regina, Canada. Gourmet Foods rents facilities in Tauranga and in Napier, New Zealand. USCF Investments leases office space in Walnut Creek, California.
We believe that the facilities described herein are adequate for our current and immediately foreseeable operating needs.
Marygold & Co. rents office space in Centennial, Colorado. Marygold UK rents office space in Croydon and Rugeley, England. We believe that the facilities described herein are adequate for our current and immediately foreseeable operating needs.
Removed
ITEM 2. PROPERTIES On July 2, 2019, Brigadier finalized the purchase of its office facility and land located in Saskatoon for CAN $750,000 (Approximately US$566,194), funded by a bank loan of CAN$525,000 (approximately US$396,336) and CAN$225,000 (US approximately $169,858) in cash. The bank loan matures in 2024 and bears interest at the annual rate of 4.14%.
Added
ITEM 2. PROPERTIES In 2019, Brigadier purchased its office facility and land located in Saskatoon for $0.6 million through cash and a loan. The bank loan matured and was paid off in July 2024. The Company does not own any other plants or real property.
Removed
Our wholly-owned subsidiary, Gourmet Foods, rents facilities in Tauranga and in Napier, New Zealand. Our wholly-owned subsidiary, USCF Investments, leases office space in Walnut Creek, California. Our wholly-owned subsidiary Marygold & Co. rents office space in Centennial, Colorado. Our wholly-owned subsidiary Marygold UK rents office space in Croydon, England.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+3 added−4 removed0 unchanged
Biggest changeITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Our Common Stock presently trades on the New York Stock Exchange ("NYSE")-American. The high and low bid prices, as reported by NYSE American, are as follows for fiscal years ended June 30, 2023 and 2022.
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market for our Shares Our common trades on the New York Stock Exchange-American (“NYSE American”) under the symbol “MGLD.” Holders On September 5, 2024, there were approximately 364 registered holders of record of our shares of common stock.
Under Nevada law, a company - such as our company - can pay dividends only • from retained earnings, and • no distribution can be made, if after giving it effect, • the corporation would not be able to pay its debts as they become due in the usual course of business; or • except as otherwise specifically allowed by the articles of incorporation, the corporation's total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of stockholders whose preferential rights are superior to those receiving the distribution.
Under Nevada law, a company can pay dividends only: ● from retained earnings, and ● no distribution can be made, if after giving it effect, the corporation would not be able to pay its debts as they become due in the usual course of business; or ● except as otherwise specifically allowed by the articles of incorporation, the corporation’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of stockholders whose preferential rights are superior to those receiving the distribution.
Under Nevada law, dividends may be paid to the extent that a corporation's assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business.
Our ability to pay dividends is subject to limitations under Nevada law. Under Nevada law, dividends may be paid to the extent that a corporation’s assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business.
Our strategy on dividends is to declare and pay dividends only from retained earnings and only when our Board of Directors deems it prudent and in the best interests of the company to declare and pay dividends. 20 Table of Contents Recent Sales of Unregistered Securities; Shares Issued for Services; Outstanding Stock Options The Company neither sold or issued any unregistered shares of any class of stock within the last two years up to and including June 30, 2023.
Our strategy on dividends is to declare and pay dividends only from retained earnings and only when our board of directors deems it prudent and in the best interests of the Company to declare and pay dividends. 19 Table of Contents Recent Sales of Unregistered Securities; Shares Issued for Services; Outstanding Stock Options We did not issue or sell any unregistered shares of any class of stock during the year ended June 30, 2024.
Removed
The quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.
Added
In addition, we have an aggregate of 49,360 shares of Series B Preferred Stock held by two persons that entitle such holders to convert each share of Series B Preferred Stock into 20 shares of common stock and to vote such shares on an “as if converted” basis.
Removed
High Low Calendar 2021 3rd Quarter $ 4.78 $ 1.75 4th Quarter $ 3.96 $ 2.60 Calendar 2022 1st Quarter $ 7.11 $ 1.77 2nd Quarter $ 2.3 $ 0.97 3rd Quarter $ 1.85 $ 1.10 4th Quarter $ 1.57 $ 1.08 Calendar 2023 1st Quarter $ 2.03 $ 1.26 2nd Quarter $ 1.90 $ 1.03 Holders On September 20, 2023, there were approximately 354 registered holders of record of our common stock.
Added
Dividends We have never declared or paid a cash dividend on our common stock or preferred stock and do not anticipate paying cash dividends on our common stock in the foreseeable future.
Removed
Dividends We have declared no dividends for the current year, nor do we expect to in the foreseeable future. Our ability to pay dividends is subject to limitations imposed by Nevada law.
Added
Payment of future cash dividends, if any, will be at the discretion of our board of directors and will depend on our financial condition, results of operations, contractual restrictions and covenants included under any bank or other indebtedness that we may enter into, capital requirements, business prospects and other factors that our board of directors considers relevant.
Removed
On August 25, 2021, the Company adopted the 2021 Omnibus Equity Incentive Plan (the "Plan") and issued stock and stock options during the current fiscal year as detailed in Note 12, Stockholders' Equity .

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

22 edited+31 added−443 removed3 unchanged
Biggest changeThe financial risk to future operations is largely unknown, (refer to Part I, Item 1A, for further details.) 21 Table of Contents Critical Accounting Policies We have chosen accounting policies that we believe are appropriate to report accurately and fairly our operating results and financial position, and we apply those accounting policies in a consistent manner.
Biggest changeAdvisory Services, LLC, a Delaware limited liability company, whose principal business office is in New Albany, Ohio; ○ Marygold & Co., (UK) Limited, a private limited company incorporated and registered in England and Wales, whose registered office is in London, England, and its wholly-owned subsidiaries: ■ Tiger Financial & Asset Management Limited, a company incorporated and registered in England and Wales, whose registered office is in Northampton, England; and ■ Step-By-Step Financial Planners Limited, a company incorporated and registered in England and Wales, whose registered office is in Staffordshire, England. 20 Table of Contents Critical Accounting Policies We have chosen accounting policies that we believe are appropriate to report accurately and fairly our operating results and financial position, and we apply those accounting policies in a consistent manner.
At the holding-company level, its liquidity needs relate to operational expense, the funding of additional business acquisitions and new investment opportunities. Our operating subsidiaries' principal liquidity requirements arise from cash used in operating activities, debt service, and capital expenditures, including purchases of equipment and services, operating costs and expenses, and income taxes.
At the holding-company level, its liquidity needs relate to operational expenses, the funding of additional business acquisitions and new investment opportunities. Our operating subsidiaries’ principal liquidity requirements arise from cash used in operating activities, debt service, and capital expenditures, including purchases of equipment and services, operating costs and expenses, and income taxes.
See "Consolidated Financial Statements." In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Some of the numbers included herein have been rounded for the convenience of presentation.
See “Consolidated Financial Statements.” In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Some of the numbers included herein have been rounded for the convenience of presentation.
Our significant policies are summarized in Note 2 to the Consolidated Financial Statements. The preparation of financial statements in conformity with U.S. generally accepted accounting principals ("US GAAP" or "GAAP") requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities.
Our significant policies are summarized in Note 2 to the Consolidated Financial Statements. The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP” or “GAAP”) requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with the financial statements and the accompanying notes thereto and is qualified in its entirety by the foregoing and by more detailed financial information appearing elsewhere in this Annual Report on Form 10-K.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with our consolidated financial statements and the accompanying notes thereto included in this Form 10-K and is qualified in its entirety by the foregoing and by more detailed financial information appearing elsewhere in this Form 10-K.
Business Combinations - Purchase Price Allocation We are a diversified holding company whose activities involve the acquisition of operating companies through stock purchase or asset purchase transactions. We account for business combinations using the acquisition method of accounting.
Business Combinations - Valuation of Intangible Assets We are a diversified holding company whose activities involve the acquisition of operating companies through stock purchase or asset purchase transactions. We account for business combinations using the acquisition method of accounting.
Off-Balance Sheet Arrangements At June 30, 2023, and as of September 25, 2023, we have not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated with us under which we have: ● An obligation under a guarantee contract, ● A retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to such entity for such assets, ● An obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by, and material to, us where such entity provides financing, liquidity, market risk or credit risk support to, or engages in leasing, hedging, or research and development services with us.
Off-Balance Sheet Arrangements At June 30, 2024, and through the date of this Annual Report on Form 10-K, we have not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated with us under which we have: ● An obligation under a guarantee contract, ● A retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to such entity for such assets, ● An obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by, and material to, us where such entity provides financing, liquidity, market risk or credit risk support to, or engages in leasing, hedging, or research and development services with us.
Dividends Our strategy on dividends is to declare and pay dividends only from retained earnings and only when our Board of Directors deems it prudent and in the best interests of the Company to declare and pay dividends. We paid no dividends during the years ended June 30, 2023 and 2022.
Dividends Our strategy on dividends is to declare and pay dividends only from retained earnings and only when our Board of Directors deems it prudent and in the best interests of the Company to declare and pay dividends. We paid no dividends during fiscal 2024 and 2023.
Cash is managed at the holding company or the subsidiary level. There are no limitations or constraints on the movement of funds between the entities. As of June 30, 2023, we had $8.2 million of cash and cash equivalents, excluding $0.4 million in restricted cash, on a consolidated basis as compared to $12.9 million as of June 30, 2022.
Cash is managed at the holding company and the subsidiary level. There are no limitations or constraints on the movement of funds between the entities. As of June 30, 2024, we had $5.5 million of cash and cash equivalents on a consolidated basis as compared to $8.2 million as of June 30, 2023, a decrease of $2.7 million or 33%.
The obligations will reduce over the passage of time through periodic lease payments. See Note 15 for further analysis of this obligation. 27 Table of Contents Borrowings As of June 30, 2023, we had $0.3 million of third-party indebtedness on a consolidated basis as compared to $0.4 million of third-party and related-party indebtedness as of June 30, 2022.
The obligations will reduce over the passage of time through periodic lease payments. See Note 14 to our Financial Statements for further analysis of this obligation. 24 Table of Contents Borrowings As of June 30, 2024, we had $0.4 million of third-party indebtedness on a consolidated basis.
In the case of continued support services, such as warranty or extended contracts, the company makes an assessment at each reporting period as to the significance of the cost of such support or warranty.
We carefully monitor the outgoings of product shipments and service completions to ensure revenues are properly recorded. In the case of continued support services, such as warranty or extended contracts, the company makes an assessment at each reporting period as to the significance of the cost of such support or warranty.
Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those discussed in the "Special Note Regarding Forward Looking Statements" found on page 4 of this Annual Report on Form 10-K.
Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those discussed in the “Special Note Regarding Forward Looking Statements” found on page 4 of this Form 10-K. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.
All the assets acquired, liabilities assumed and amounts attributable to intangible assets, including goodwill, are recorded at their respective fair values at the date of acquisition. The determination of fair values of identifiable assets and liabilities involves estimates and the use of valuation techniques when market value is not readily available.
All the assets acquired, liabilities assumed and amounts attributable to intangible assets, including goodwill, are recorded at their respective fair values at the date of acquisition. Determination of fair value involves estimates and assumptions which can be complex, most notably with respect to intangible assets.
Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles. Introduction The Marygold Companies, Inc. ("The Marygold Companies" or the "Company") conducts business through its wholly-owned operating subsidiaries operating in the U.S., New Zealand and Canada.
Introduction The Marygold Companies, Inc. (“The Marygold Companies” or the “Company”) conducts business through its wholly-owned operating subsidiaries operating in the U.S., New Zealand and Canada.
We use various techniques to determine fair value in such instances, including the income approach and use of independent valuation firms. Significant estimates used in determining fair value include, but are not limited to, the amount and timing of future cash flows, growth rates, discount rates and useful lives.
Critical estimates used in the valuation of intangible assets include, but are not limited to, the amount and timing of projected cash flows, useful lives, and discount rates.
The tax position is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement.
The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.
USCF Investments classifies these investments as current assets as these investments are generally sold within one year from the balance sheet date. As of June 30, 2023, USCF Investments held investment positions in three of its 40 Act funds, GLDX, ZSB and USE of $1.3 million, $1.9 million and $2.6 million, respectively.
Investments USCF Investments, from time to time, provides initial investments in the creation of ETP funds that USCF Investments manages. USCF Investments classifies these investments as current assets as these investments are generally sold within one year from the balance sheet date.
The operations of the Company's wholly-owned subsidiaries are more particularly described herein but are summarized as follows: ● USCF Investments, Inc.
The operations of the Company’s wholly-owned subsidiaries are more particularly described herein but are summarized as follows: ● Fund Management - USCF Investments, Inc., a Delaware corporation (“USCF Investments”), with corporate headquarters in Walnut Creek, California and its wholly-owned subsidiaries: ○ United States Commodity Funds, LLC, a Delaware limited liability company (“USCF LLC”), and ○ USCF Advisers, LLC, a Delaware limited liability company (“USCF Advisers”).
The company recognizes the revenue when the product or service is delivered, or the ownership of the product is deemed to have been transferred to the buyer. We carefully monitor the outgoings of product shipments and service completions to ensure revenues are properly recorded.
Revenue Recognition Our operating subsidiaries derive revenues from a number of sources including sales of hardware, services, food items, printing, financial services, and consumer products. The company recognizes the revenue when the product or service is delivered, or the ownership of the product is deemed to have been transferred to the buyer.
The Company has one finance lease wherein ownership of the underlying asset will be transferred to the Company at the end of the lease term. The underlying asset of the finance lease is a solar energy system at our Gourmet Foods subsidiary in New Zealand that is included with property, plant and equipment on the Consolidated Balance Sheets.
Brigadier owed $0.3 million under a loan that was secured with the land and building in Canada. In July 2024, Brigadier repaid the loan in full. In addition, Gourmet Foods has a finance lease liability of $0.1 million related to a solar energy system which is included under Loans - property and equipment on our consolidated balance sheets.
As of June 30, 2022 USCF Investments had a $1.3 million position in GLDX. These investments along with other investments, as applicable, are described further in Note 7 to our Financial Statements.
As of June 30, 2024, USCF Investments held investment positions totaling $7.5 million in four of its registered Investment Company Act funds. These investments along with other investments, as applicable, are described further in “Note 5 – Investments” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Other Operating expenses decreased by $0.2 million primarily due to lower sub-adviser fees as result of lower AUM for USCI, and lower fund accounting and administration expense due to lower average AUM from other funds.
Operating income decreased by $2.7 million or 36% driven by the decrease in average AUM as described above and increased fund operations expenses of $0.8 million or 17% as a result of increased licenses and fees as well as fund accounting and administration costs due to an increase in the number of funds managed.
Removed
("USCF Investments"), a U.S. based company, is the sole member of two investment services limited liability company subsidiaries that manages, operates or is an investment advisor to exchange traded funds organized as limited partnerships or investment trusts that issue shares that trade on the NYSE Arca stock exchange. ● Gourmet Foods, Ltd., a New Zealand based company, manufactures and distributes New Zealand meat pies on a commercial scale and its wholly-owned New Zealand subsidiary company, Printstock Products Limited, prints specialty wrappers for the food industry in New Zealand and Australia.
Added
The principal place of business for each of USCF LLC and USCF Advisers is in Walnut Creek, California. ● Food Products – Gourmet Foods, Ltd., a registered New Zealand company located in Tauranga, New Zealand and its wholly-owned subsidiary, Printstock Products Limited, a registered New Zealand company, with is principal manufacturing facility in Napier, New Zealand. ● Security Systems – Brigadier Security Systems (2000) Ltd., a Canadian registered corporation, with locations in Regina and Saskatoon, Saskatchewan, Canada. ● Beauty Products - Kahnalytics, Inc., a California corporation, doing business as “Original Sprout,” located in San Clemente, California. ● Financial Services – United States and Great Britain: ○ Marygold & Co., a Delaware corporation, based in Denver, Colorado, and its wholly-owned subsidiary, Marygold & Co.
Removed
(collectively "Gourmet Foods") ● Brigadier Security Systems (2000) Ltd.
Added
While management’s estimates of fair value are based on assumptions that are believed to be reasonable, these assumptions are inherently uncertain as they pertain to forward-looking views of our business and market conditions. The judgments made in this valuation process could materially impact our consolidated financial statements.
Removed
("Brigadier"), a Canadian based company, sells and installs commercial and residential alarm monitoring systems. ● Kahnalytics, Inc. dba/Original Sprout ("Original Sprout"), a U.S. based company, is engaged in the wholesale distribution of hair and skin care products under the brand name Original Sprout on a global scale. ● Marygold & Co., a newly formed U.S. based company, together with its wholly-owned limited liability company, Marygold & Co.
Added
Impairments Goodwill and other intangible assets are tested for impairment at the reporting unit level on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.
Removed
Advisory Services, LLC, ( collectively "Marygold") was established by The Marygold Companies to explore opportunities in the financial technology ("Fintech") space, completed its development phase in June 2023, and launched its commercial services in June 2023. Through June 30, 2023, expenditures have been limited to developing the business model and the associated application development. ● Marygold & Co.
Added
These events or circumstances could include a significant change in the business climate, legal factors, operating performance indicators, competition, or sale or disposition of a significant portion of a reporting unit. Application of the goodwill and other intangible assets impairment test requires judgment in the determination of the fair value of each reporting unit.
Removed
(UK) Limited, a newly formed U.K. limited company, together with its newly acquired UK subsidiary, Tiger Financial and Asset Management, Ltd. (collectively "Marygold UK") is an asset manager and registered investment advisor in the UK. Operations began on June 20, 2022.
Added
The fair value of each reporting unit is estimated primarily through the use of a discounted cash flow methodology.
Removed
Because the Company conducts its businesses through its wholly-owned operating subsidiaries, the risks related to our wholly-owned subsidiaries are also risks that impact the Company's financial condition and results of operations. See," Note 2. Summary of Significant Accounting Policies / Major Customers and Suppliers - Concentration of Credit Risk " in the consolidated financial statements for more information.
Added
This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital.
Removed
The emergence of a novel coronavirus on a global scale, known as COVID-19, and related geopolitical events could lead to increased market volatility, disruption to U.S. and world economies and markets and may have significant adverse effects on the Company and its wholly-owned subsidiaries.
Added
Changes in these estimates and assumptions could materially affect the determination of fair value and impairment for each reporting unit. Legal and Other Contingencies The outcomes of legal proceedings and claims brought against us are subject to significant uncertainty.
Removed
The excess of the purchase consideration over fair values of identifiable assets and liabilities is recorded as goodwill. See Note 8 for further detail on goodwill.
Added
We evaluate developments in these matters on a regular basis and a contingency loss is accrued by a charge to income when we believe it is both probable that a loss has been incurred and the amount can be reasonably estimated.
Removed
Management's estimate of fair value is based on assumptions believed to be reasonable, and are supported by independent valuations where possible, but nevertheless remain subjective and subject to future adjustment if actual results differ from the estimates. Foreign Subsidiaries We currently have three wholly-owned subsidiaries that are domiciled in foreign countries. In the future we may acquire additional foreign subsidiaries.
Added
In determining whether a loss should be accrued, we evaluate among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss. Changes in these factors could materially impact our consolidated financial statements.
Removed
The financial statements of our foreign subsidiaries are kept in accordance with their respective local jurisdictions and require adjustment in order to conform to U.S. GAAP. Additionally, local currencies of these subsidiaries require conversion to our US dollar in accordance with ASC 830, Foreign Currency Matters .
Added
Income Taxes The objectives of accounting for income taxes are to recognize the amount of taxes payable or refundable for the current year, and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in an entity’s financial statements or tax returns.
Removed
Due to changing currency translation rates, the value of our assets and liabilities held in foreign jurisdictions are inherently volatile in nature and may vary significantly despite our use of averages and estimates. Revenue Recognition Our operating subsidiaries derive revenues from a number of sources including sales of hardware, services, food items, printing, financial services, and consumer products.
Added
We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.
Removed
Plan of Operation for the Next Twelve Months Our plan of operation for the next twelve months is to apply necessary resources, which may include experienced personnel, cash, or synergistic acquisitions made with cash, equity or debt, into growing each of our business units to their potential.
Added
Accounting literature also provides guidance on derecognition of income tax assets and liabilities, classification of deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. Judgment is required in assessing the future tax consequences of events that have been recognized in our consolidated financial statements or tax returns.
Removed
Original Sprout has found it necessary to alter its approach through domestic distribution channels. Due to the effects of the COVID-19 pandemic on consumer shopping habits, many domestic distributors have found it advantageous to sell direct to consumers online, thus becoming retailers in lieu of distributors.
Added
Variations in the actual outcome of these future tax consequences could materially impact our consolidated financial statements. 21 Table of Contents SUMMARY RESULTS OF OPERATIONS (in thousands, except percentages) Fiscal 2024 Fiscal 2023 Percentage Change Revenue $ 32,836 $ 34,877 -6% Cost of revenue 8,720 8,751 0% Gross profit 24,116 26,126 -8% Operating expenses 30,372 24,706 23% (Loss) income from operations (6,256 ) 1,420 -541% Other income, net 808 174 364% (Loss) income before income taxes (5,448 ) 1,594 -442% Benefit (provision) of income taxes 1,379 (429 ) -421% Net (loss) income $ (4,069 ) $ 1,165 -449% Fiscal Year 2024 Compared with Fiscal Year 2023 Revenue decreased by $2.0 million or 6% for fiscal 2024 driven by reduced average Assets Under Management (“AUM”) in our fund management business.
Removed
The result has been an erosion of profit margins and a fragmented sales channel which have slowed the product roll out plans of Original Sprout. They are in the final stages of correcting this situation and, in spite of incurring losses as a result, expect to realize significant growth in sales volume and profits in the coming fiscal year.
Added
Average AUM for fiscal 2024 was $3.3 billion compared to $3.7 billion for fiscal 2023. The reduction in AUM in fiscal 2024 was due to commodity price fluctuations, rising interest rate environment as well as geopolitical and economic uncertainty.
Removed
Additionally, we are expecting moderate growth in Brigadier through focused management initiatives and partnering with local telecoms and contractors. Similarly, we expect Gourmet Foods to be operating more efficiently as low margin products are eliminated, new channels to market are established, and the printing and sale of food wrappers by their subsidiary, Printstock, continue to improve.
Added
Gross profit decreased by $2.0 million or 8% for the reasons described above for the reduced revenue as cost of revenue was relatively flat from fiscal 2024 at $8.7 million compared to fiscal 2023 at $8.8 million. Operating expenses increased by $5.7 million or 23% as a result of the following.
Removed
USCF Investments will continue to develop innovative and new fund products to grow its portfolio.
Added
General and administrative expenses, including marketing and advertising, increased by $2.4 million or 25% driven by increased costs associated with our Fintech app development including additional software and security infrastructure.
Removed
In addition to our long-term mission that is an acquisition strategy based upon identifying and acquiring profitable, mature, companies of a diverse nature and with in-place management that produces increased revenue streams, the Company is also focused upon building expertise and developing Fintech opportunities in the financial services sector through its subsidiary Marygold and Co.
Added
We recorded a $1.4 million impairment charge relating to the goodwill and other intangible assets in our beauty products unit as a result of increased losses resulting from pandemic-related changes in its distribution channels and increased costs from the introduction of new product lines.
Removed
To augment that effort, the Company established a subsidiary in England, Marygold UK, who acquired a registered UK investment advisor, Tiger Financial and Asset Management ("Tiger"). We hope to leverage the client list, industry experience, and banking relationships of Tiger to project our Marygold & Co fintech offerings in the UK during the coming fiscal year.
Added
Salaries and compensation increased by $1.1 million or 11% compared to fiscal 2023 driven by increased hiring for the buildout of our mobile Fintech app. Fund operations increased by $0.8 million or 17% driven by increased costs associated with managing more funds. Other income, net increased by $0.6 million or 364% driven by unrealized gains on investments.
Removed
In a more general sense, the Company is characterizing its business in two categories: 1) financial services and 2) other consumer-based operating units. The purpose is to isolate the cyclical, and sometimes volatile, nature of the financial services business from our other industry segments.
Added
Income tax went from a provision of $0.4 million in fiscal 2023 to a tax benefit of $1.4 million in fiscal 2024 as a result of generating pre-tax income in the prior year to incurring a pre-tax loss in the current year.
Removed
As revenues from financial services fluctuate over time due to varying performance of the commodities markets, our other operations are expected to be stable and sustainable by comparison.
Added
Net loss of $4.1 million generated in fiscal 2024 compared to net income of $1.2 million in fiscal 2023 was driven by the increased costs associated with the investment in our mobile Fintech app, the increased losses including the impairment charge relating to our beauty products unit and the decreased profits from our fund management business due to lower AUM. 22 Table of Contents SEGMENT RESULTS OF OPERATIONS (in thousands, except percentages) Fiscal 2024 Fiscal 2023 Percentage Change Revenue Fund management - related party $ 18,965 $ 20,862 -9% Food products 7,271 7,632 -5% Beauty products 3,296 3,033 9% Security systems 2,655 2,833 -6% Financial services 649 517 26% Total revenue $ 32,836 $ 34,877 -6% Operating (Loss) Income Fund management - related party $ 4,773 $ 7,462 -36% Food products 321 283 13% Beauty products (2,138 ) (285 ) 650% Security systems 325 599 -46% Financial services (5,943 ) (3,367 ) 77% Corporate headquarters (3,594 ) (3,272 ) 10% Total operating (loss) income $ (6,256 ) $ 1,420 -541% Reportable Segments Fiscal Year 2024 Compared with Fiscal Year 2023 Fund Management - USCF Investments Revenue decreased by $1.9 million or 9% driven by reduced average Assets Under Management (“AUM”) in our fund management business.
Removed
By these initiatives we seek to: ● continue to gain market share for our wholly-owned subsidiaries' areas of operation, 22 Table of Contents ● increase our revenues and realize net operating profits, ● lower our operating costs by unburdening certain selling expenses to third party distributors, ● have sufficient cash reserves to pay down accrued expenses. ● attract parties who have an interest in selling their privately held companies to us, ● achieve efficiencies in accounting and reporting through adoption of standards used by all subsidiaries on a consistent basis, ● strategically pursue additional company acquisitions, and ● expand launch of services by Marygold & Co., Marygold UK, and Marygold & Co.
Added
Average AUM for fiscal 2024 was $3.3 billion compared to $3.7 billion for fiscal 2023. The reduction in AUM in fiscal 2024 was due to commodity price fluctuations, rising interest rate environment as well as geopolitical and economic uncertainty.
Removed
Advisory Services LLC, and the creation of new corporate entities as focused subsidiary holdings.
Added
Food Products - Gourmet Foods Revenue decreased by $0.4 million or 5% and operating income increased slightly driven by changing our product mix and refocusing production capacity to higher profit margin customers.
Removed
Results of Operations For the Year Ended June 30, 2023 Compared to the Year Ended June 30, 2022 Revenue, Expenses and Operating Income Consolidated revenues for the year ended June 30, 2023 were $34.9 million representing approximately a $3.0 million or 8% decrease from the prior year revenue of $37.8 million.
Added
Beauty Products – Original Sprout Revenue increased by $0.3 million or 9% and operating loss increased by $1.9 million or 650% driven by a $1.4 million impairment charge relating to the goodwill and other intangible assets in our beauty products unit as a result of increased losses resulting from pandemic-related changes in its distribution channels and increased costs from the introduction of new product lines.
Removed
The decrease in consolidated revenues is primarily attributed to the decrease in annual revenues of USCF Investments. USCF Investments' average Assets Under Management ("AUM") for the year ended June 30, 2023 was lower than that of 2022, which resulted in a revenue decrease of approximately $3.0 million.
Added
Security Systems - Brigadier Revenue decreased by $0.2 million or 6% and operating income decreased by $0.3 million or 46% driven by market timing and weather patterns. 23 Table of Contents Financial Services – Marygold US and Marygold UK Revenue increased by $0.1 million or 26% driven by increased revenues at Tiger and the incremental revenue from Step-By-Step which was acquired in April 2024.
Removed
The other non-financial subsidiaries combined for a total decrease in revenues of approximately $0.5 million or approximately 4%, offset by $0.5 million in revenue from our UK financial services subsidiary which did not have a full year of operations during the prior year.
Added
Operating loss increased by $2.6 million or 77% driven by increased costs incurred in connection with the launch, marketing and roll-out of our mobile Fintech app in June 2023.
Removed
Consolidated operating expenses for the year ended June 30, 2023 were $33.5 million, a decrease of $2.0 million from the prior year expense of $35.5 million primarily due to the $2.5 million legal settlement incurred by USCF Investments in the prior year.
Added
Corporate Headquarters Operating loss for the corporate headquarters increased by $0.3 million or 10% driven by higher stock-based compensation expenses as we began granting equity awards in fiscal 2023 and increased the grants in fiscal 2024. Liquidity and Capital Resources The Marygold Companies is a holding company that conducts its individual business operations through its subsidiaries.
Removed
The Marygold Companies produced operating income for the year ended June 30, 2023 of $1.4 million as compared to $2.4 million for the year ended June 30, 2022. This represents a decrease in operating income of $1.0 million for the year ended June 30, 2023 when compared to the year ended June 30, 2022 or approximately 33%.
Added
Our cash used in operating activities for fiscal 2024 was $1.9 million. For fiscal 2024, USCF Investments invested $3.0 million by seeding one new fund and we made additional expenditures of $5.7 million in Marygold for the mobile Fintech app. We have invested a total of $15.1 million in the Fintech app since Marygold’s inception.
Removed
Apart from the $3.0 million decline in revenues, the difference in operating income is attributed to the expenses incurred by our subsidiary, Marygold & Co., in development of its mobile fintech app, which amounted to approximately $3.4 million, and a legal settlement of $2.5 million incurred by our USCF Investments subsidiary in the prior year.
Added
We expect that Marygold will require additional capital to fund its losses over the coming 12 months. As the funding requirements become known, we will decide upon the source of the additional capital investment to be made as the need arises.
Removed
Other Income (Expenses) Other income (expense) for the years ended June 30, 2023 and 2022 were $174 thousand and ($22) thousand, respectively, resulting in income before income tax of $1.6 million and $2.4 million, respectively.
Added
During fiscal 2024, we made a deposit of $1.8 million in connection with the potential acquisition of a 9.9% equity interest in a domestic financial institution that is currently seeking certain regulatory approval. Despite these cash investments and expenses, our working capital position remains strong at $19.0 million as of June 30, 2024.

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