A-Mark Precious Metals, Inc.

Good afternoon and welcome to AMARC's Precious Metals conference call for the fiscal second quarter ended December 31st, 2020. My name is Laura and I will be the operator this afternoon. Before this call, AMARC issued its results for the fiscal second quarter 2021 in a press release, which is available in the investor relations section of the company's website at www.amarc.com. You can find the link in the investor relations section at the top of the homepage. Joining us for today's call are AMARC CEO Greg Roberts, President Thor Geerdrum, CFO Kathleen Simpson-Taylor, as well as JM Bullion's co-founder and CEO Michael Whitmire. Following the remarks, we will open the call for your questions. Then, before we conclude the call, I'll provide the necessary cautions regarding the forward-looking statements made by management during this call. I would like to remind everyone that this call is being recorded and will be made available for replay via a link available in the investor relations section of AMARC's website. Now, I would like to turn this call over to AMARC's CEO, Mr. Greg Roberts. Sir, please proceed.

Thank you, Laura. Good afternoon, and thank you for joining AMARC's conference call. Today is a truly exciting and transformative day for AMARC, and I'm looking forward to sharing a number of updates with you. As you may have seen, after the market closed today, we issued a press release announcing AMARC's agreement to acquire JM Bullion. We also issued a press release with our financial results for the second quarter and first six months of fiscal 2021, which I'll touch base on before getting into the acquisition. Q2 was another solid quarter for AMARC and reflects the profitability we continue to see during these market conditions. Following the unprecedented volatility in the precious metals markets during Q1, which produced record profitability for AMARC, the second quarter was characterized by slightly lower but still strong product demand, volumes, and premium spreads. Taken together, these market dynamics allowed us to realize another strong financial performance this quarter, including generating $8.9 million in net income attributable to the company, which contributed to the most profitable first half of any fiscal year in AMARC's history. Our financial results continue to demonstrate the benefits of our unique business model, which is designed to generate steady and diverse revenue streams in normal market conditions and outsized profitability during more volatile market periods, which we have been experiencing the last few quarters. We've intentionally built AMARC with three complementary business segments, which support one another and drive incremental and organic business across the platform. A good example of this is our minting operations, which is anchored by our investment in Silvertown Mint. Silvertown provides AMARC, Goldline, and JM Bullion with improved supply during supply-constrained periods, which we've seen over the last few quarters. This tightly integrated and synergistic model also provides us with multiple growth avenues, including cross-selling opportunities for continued expansion. The resulting effect is our continued ability to capture increasing value across the precious metals market. As I mentioned earlier, in addition to strong financial results for the second quarter, we also issued a press release today announcing the definitive agreement we have signed with JM Bullion, a leading e-commerce retailer of precious metals, to acquire the remaining 79.5% of the issued and outstanding shares of JM Bullion not currently owned by AMARC. Before discussing JMB and the strategic rationale, I think it's important to provide some context. A key driver of our exceptional financial results over the last several quarters are the strategic investments we have made to expand AMARC's direct sales segment. This area of our business has grown considerably over the last several quarters and has contributed to increasing profitability. AMARC has been a leader in precious metals since 1965. Over that time, we've established a robust wholesale business with a marquee institutional customer list. We've been able to grow our position in the market thanks to the high caliber team we've assembled that has more than 100 years of industry experience in various commodity cycles and market conditions. Several years ago, we recognized the evolving customer buying patterns and how the internet and e-commerce was dramatically changing the retail precious metals market. In response, we expanded AMARC's presence and position in the retail market, initially through our minority investment in JM Bullion back in 2014, and more recently through minority investments in two other precious metals e-commerce businesses, each of which serve differentiated customer bases. Over the past six years, we have been able to make further investments in JM Bullion and have enjoyed a highly synergistic relationship together. We are now very excited to add JM Bullion and its management team to our business, as the combination of AMART and JM Bullion will create the industry's preeminent fully integrated Precious Metals platform. Since its founding in 2011, JM Bullion has experienced tremendous success. JM's co-founder and CEO Michael Whitmire, who is on the call with us today, leveraged his team's expertise in e-commerce and search engine optimization to establish JM Bullion as a lead player in the Precious Metals industry. Based on this success, AMARC became increasingly comfortable with our minority investment as Michael and his team proved our thesis that e-commerce was transforming how retail investors bought and sold precious metals. Over the past several quarters, we've watched JM Bullion execute exceptionally well to take advantage of favorable market conditions as well as manage unprecedented volume, packages, and ounces sold. And we reached the conclusion that our respective businesses would be even stronger as a combined platform. And as the saying goes, we truly believe one plus one is equal to three. With that, I will turn it over to Michael to introduce himself, his company, and the value he sees in joining AMARC. Michael, welcome to the team. Take it away.

Thank you, Greg, and good afternoon, everyone. Thanks for having me join the call. Today is a very exciting day in JM's history and evolution. It wasn't that long ago that JM was just two co-founders operating out of a basement in Lancaster, Pennsylvania, which really puts into perspective how far the company has been able to come over the last nine years. Since our founding, we have established our company as an industry price leader, exceeding customer expectations with fast, secure shipping and award-winning customer service. We've been able to do that through the dedicated efforts of our team, along with the support of high quality partners like Greg and Amark, who have helped JM pursue our mission to create one of the largest and fastest growing online retailers of precious metals in the world. For those of you who aren't familiar with JM, our company enables individual investors to easily and efficiently purchase physical precious metals over the internet. We offer a broad selection of gold, silver, platinum, palladium, and copper products through our various company-owned websites and marketplaces. Today, we operate five uniquely branded websites targeting specific niches within the precious metals market. These include jmbullion.com, providentmetals.com, silver.com, goldprice.org, silverprice.org, along with our JM eBay marketplace. We've experienced tremendous demand lately on our sites and for our products. particularly silver products as retail investors look to gain exposure to silver. Direct-to-consumer suppliers like JM have had a difficult time keeping up with the level of demand, which is at multiples from what we typically see. Now, by partnering even more closely with Greg and the AMARC team, JM will be able to leverage AMARC's unmatched capabilities in product sourcing and minting to be even better positioned to serve our growing customer base's demand for precious metals products. Thank you again, everyone, and I will now turn it back over to Greg.