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8-K - FORM 8-K - U S GLOBAL INVESTORS INC | c11790e8vk.htm |
Exhibit 99.1
Contact: Ryan George Public Relations 210.308.1268 rgeorge@usfunds.com |
For Immediate Release
U.S. Global Investors reports 88 percent increase
in earnings per share for 2Q2011
Company reports more than $3 billion in assets under management
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in earnings per share for 2Q2011
Company reports more than $3 billion in assets under management
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SAN ANTONIOFebruary 2, 2011U.S. Global Investors, Inc. (NASDAQ: GROW), a boutique
registered investment advisory firm specializing in natural resources and emerging markets, today
reported that revenue increased 34 percent and earnings per share increased 88 percent on a
quarter-over-quarter basis for the quarter ended December 31, 2010. Year-over-year revenue
increased 32 percent and earnings per share increased 50 percent for the quarter.
In the second quarter of fiscal 2011, U.S. Global recorded net income of $2.3 million, or 15 cents
per diluted share, on revenue of $11.9 million.
This compares to net income of $1.3 million, or 8 cents per diluted share, on revenue of $8.9
million in the first quarter of fiscal year 2011. The company earned $1.5 million, or 10 cents per
diluted share, on revenue of $9.0 million for the same quarter a year earlier.
Assets under management for SEC-registered funds and other clients stood at $3.04 billion as of
December 31, 2010. Total assets under management during the latest quarter averaged $2.85 billion.
Average assets under management have increased 50 percent from the lows experienced during the
third quarter of fiscal year 2009.
Each of the companys new institutional class of funds experienced positive quarter-over-quarter
fund flows during the quarter. These funds were launched in March of 2010.
The midterm elections removed some uncertainty and negative sentiment from the marketplace and
based on money flows, it appears that investors are beginning to return to equity markets, says
Frank Holmes.
2Q11
earnings, Page 2
Feb 2, 2011
Feb 2, 2011
According to data from the Investment Company Institute, the velocity of industry fund flows
increased to over $5 billion in December, and equity funds have seen that figure roughly double to
more than $10 billion so far in 2011.
Globally, the resource sector has undergone significant consolidation activity over the past 18
months, particularly in the key producing regions of Australia and North America and our funds have
benefited, says Holmes.
The Global Resources Fund (PSPFX), the companys largest fund, was Lippers top-performing global
natural resources fund for total return in 2010. In 2009, the World Precious Minerals Fund (UNWPX)
was Lippers top-performing gold fund for total return, the second time in four years for that
achievement. In addition, both funds received 2007 and 2008 Lipper Fund Awards as the best overall
fund in their respective categories.
Overall, four of U.S. Globals emerging market and resource-oriented funds ranked among the top 45
funds (top 1 percent) for total return among the entire mutual fund universe for the past decade.
In addition, the Eastern European Fund (EUROX), the companys third-largest fund, was named one of
five top European Mutual Funds to own by Zacks Research. Zacks Research ranks funds by evaluating
the quality of the stocks in its underlying portfolio, as well as the firms expectations of the
funds performance relative to its peers. Zacks also recently named the Global Resources Fund as a
top five Energy Mutual Fund.
We expect commodity prices to remain both volatile and at historically strong levels over the next
12-18 months, says Holmes. This is because emerging market infrastructure growth should continue
to drive healthy demand and new supply sources of many commodities continue to be constrained.
For those investors with longer-term investment horizons and higher risk tolerance, we believe
emerging markets and resource equities still offer attractive relative value and growth
opportunities to consider, and this should continue to attract mainstream institutional investors,
says Holmes.
The company has scheduled a webcast for 7:00 a.m. Central time on Thursday, February 3, 2011, to
discuss the companys key financial results for the quarter. Frank Holmes, CEO and Chief Investment
Officer, will be accompanied on the webcast by Susan McGee, President and General Counsel, and
Catherine Rademacher, Chief Financial Officer. Click here to register.
2Q11
earnings, Page 3
Feb 2, 2011
Feb 2, 2011
Selected financial data (unaudited):
Three months ended | ||||||||
12/31/2010 | 12/31/2009 | |||||||
Revenues |
$ | 11,910,738 | $ | 9,028,605 | ||||
Expenses |
8,270,445 | 6,719,552 | ||||||
Income before taxes |
3,640,293 | 2,309,053 | ||||||
Tax expense |
1,310,007 | 801,001 | ||||||
Net income |
$ | 2,330,286 | $ | 1,508,052 | ||||
Earnings per share (basic) |
$ | 0.15 | $ | 0.10 | ||||
Earnings per share (diluted) |
$ | 0.15 | $ | 0.10 | ||||
Avg. common shares outstanding (basic) |
15,372,554 | 15,336,967 | ||||||
Avg. common shares outstanding
(diluted) |
15,372,554 | 15,340,847 | ||||||
Avg. assets under management (billions) |
$ | 2.85 | $ | 2.66 |
About U.S. Global Investors, Inc.
U.S. Global Investors, Inc. (www.usfunds.com) is a registered investment adviser that
focuses on profitable niche markets around the world. Headquartered in San Antonio, Texas, the
company provides advisory, transfer agency and other services to U.S. Global Investors Funds and
other clients.
With an average of $2.85 billion in assets under management in the quarter ended December 31, 2010,
U.S. Global Investors manages domestic and offshore funds offering a variety of investment options,
from emerging markets to money markets.
This news release may include certain forward-looking statements including statements relating to
revenues, expenses, and expectations regarding market conditions. These statements involve certain
risks and uncertainties. There can be no assurance that such statements will prove accurate and
actual results and future events could differ materially from those anticipated in such statements.
U.S. Global Investors routinely posts corporate filings and other important information on the
companys website, www.usfunds.com.
2Q11
earnings, Page 4
Feb 2, 2011
Feb 2, 2011
The Global Resources Fund (PSPFX) ranked #1 out of 131, #17 out of 54, and #1 out of 32 global
natural resources funds by Lipper for total return for the 1-, 5- and 10-year periods as of
December 31, 2010. The World Precious Minerals
Fund was ranked #24 of 83, #26 of 52 and #6 of 32 precious metals funds for total return by Lipper
for the 1-, 5- and 10-year periods ended December 31, 2010. The World Precious Minerals Fund was
ranked #1 of 71, #34 of 51 and #18 of 29 for total return among gold-oriented funds by Lipper for
the 1-, 5- and 10-year periods ended December 31, 2009. The Gold and Precious Metals Fund (USERX)
ranked #193 out of 21,767, #39 out of 14,636, and #13 out of 8,647 among all mutual funds by Lipper
for total return for the 1-, 5- and 10-year periods ended December 31, 2010. The World Precious
Minerals Fund (UNWPX) ranked #72 out of 21,767, #48 out of 14,636, and #7 out of 8,647 among all
mutual funds by Lipper for total return for the 1-, 5- and 10-year periods ended December 31, 2010.
The Eastern European Fund (EUROX) ranked #4,584 out of 21,767, #8,116 out of 14,636, and #40 out of
8,647 among all mutual funds by Lipper for total return for the 1-, 5- and 10-year periods ended
December 31, 2010. The Global Resources Fund (PSPFX) ranked #142 out of 21,767, #622 out of 14,636,
and #45 out of 8,647 among all mutual funds by Lipper for total return for the 1-, 5- and 10-year
periods ended December 31, 2010. Lipper Fund Awards are presented annually for consistent return
over 3-, 5- and 10-year periods. Consistent return incorporates risk-adjusted return and the
strength of the funds performance trend. Past performance does not guarantee future results.
Please consider carefully a funds investment objectives, risks, charges and expenses. For this and
other important information, obtain a fund prospectus by visiting www.usfunds.com or by calling
1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing. Distributed by U.S. Global
Brokerage, Inc.
Foreign and emerging market investing involves special risks such as currency fluctuation and less
public disclosure, as well as economic and political risk.
By investing in a specific geographic region, a regional funds returns and share price may be more
volatile than those of a less concentrated portfolio.
Gold, precious metals, and precious minerals funds may be susceptible to adverse economic,
political or regulatory developments due to concentrating in a single theme. The prices of gold,
precious metals, and precious minerals are subject to substantial price fluctuations over short
periods of time and may be affected by unpredicted international monetary and political policies.
We suggest investing no more than 5% to 10% of your portfolio in these sectors.
The Eastern European Fund invests more than 25% of its investments in companies principally engaged
in the oil & gas or banking industries. The risk of concentrating investments in this group of
industries will make the fund more susceptible to risk in these industries than funds which do not
concentrate their investments in an industry and may make the funds performance more volatile.
Because the Global Resources Fund concentrates its investments in a specific industry, the fund may
be subject to greater risks and fluctuations than a portfolio representing a broader range of
industries.
2Q11 earnings, Page 5
Feb 2, 2011
Feb 2, 2011
As of 12/31/10, the Eastern European Fund earned a Zacks Rank of 1 for the 1-year, 3-year, 5-year
and 10-year periods, out of 29 European Mutual Funds. As of 12/31/10, the Global Resources Fund
earned a Zacks Rank of 1 for the 1-year, 3-year, 5-year and 10-year periods, out
of 38 Energy Mutual Funds. Zacks assigns Zacks Mutual Fund Ranks [TM] on a scale from 1 to 5 where
1 is the best and 5 is the worst. Zacks Mutual Fund Ranks are based on an exclusive process created
by the Zacks Quantitative Research Department, evaluating the average Zacks Rank for the stocks
owned by a fund. Sales charges, loads and redemption fees are not considered when determining the
Zacks Mutual Fund Rank. Past Performance is not a guarantee of future results.
Although Lipper makes reasonable efforts to ensure the accuracy and reliability of the data
contained herein, the accuracy is not guaranteed by Lipper. Users acknowledge that they have not
relied upon any warranty, condition, guarantee, or representation made by Lipper. Any use of the
data for analyzing, managing, or trading financial instruments is at the users own risk. This is
not an offer to buy or sell securities.
All opinions expressed and data provided are subject to change without notice. Some of these
opinions may not be appropriate to every investor.