A-Mark Precious Metals, Inc.

Good afternoon and welcome to AMARC precious metals conference call for the fiscal second quarter ended December 31st, 2022. My name is John and I will be your operator this afternoon. Before this call, AMARC issued its results for the fiscal second quarter 2023 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 to the investor relations section at the top of the homepage. Joining us for today's call are AMARC's CEO, Greg Roberts, President Thor Gerdrum, and CFO Kathleen Simpson-Taylor. Following their remarks, we will open the call to 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 we 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 the call over to AMARC's CEO, Mr. Greg Roberts. Sir, please proceed.

Thank you and good afternoon, everyone. Thank you all for joining our call today. As you can see from our earnings release, the second quarter represented another solid quarter for AMARC with diluted EPS of $1.35 and EBITDA of nearly $49 million with a 6% quarterly return on equity. We generated these results despite the subdued market conditions that we experienced during the latter half of the quarter. demonstrating the strength of our fully integrated business model. Our DTC segment continued to contribute significantly to our overall results, generating 57% of our consolidated gross profit for the quarter, with 130 basis point increase in our DTC gross margin percentage year over year. Our total DTC customer base grew 15% year over year, New DTC customers for the quarter grew 230% year over year, and active DTC customers for the quarter grew 30% year over year. Approximately 55% of the new customers were acquired from our BJSC asset purchase in October 2022. We are encouraged by the performance of the now fully integrated BJSC brand and the customer base that we acquired. Our DTC segment continues to grow and remains a key contributor to our overall business. We remain active in seeking opportunities to strategically enhance our business. As we announced last month, we purchased a 12% minority interest in Texas Precious Metals, or TPM, a leading e-commerce precious metals retailer with a strong geographic presence in Texas. TPM has over 50,000 customers and we look forward to supporting their growth through our four-year extension of our exclusive supplier agreement. Last week, we also entered into a definitive agreement to acquire a 25% minority interest in Atkinson Bullion and Coin, a leading online retailer of precious metals, bullion, and coins based in the United Kingdom. This investment transaction is expected to close in the first quarter of calendar 23, and will expand our international footprint outside of North America. Another key driver of our performance continues to be our minting business, which provides us with ongoing access to supply with production levels continuing at near record levels for the second quarter. Now, I'll turn it over to our CFO, Kathleen Simpson-Taylor, to walk you through our financials in more detail. Then, President Thor Jerdrum will discuss our operating metrics Afterwards, I'll provide a further update on our business and growth strategy and take your questions. Kathleen?

Thank you, Greg, and good afternoon, everyone. Our revenues for fiscal Q2 2023 increased 0.2% to $1.95 billion from $1.946 billion in Q2 of last year. The increase was due to an increase in silver ounces sold partially offset by a decrease in gold ounces sold and lower average selling prices of gold and silver. The DTC segment contributed 23% of the consolidated revenue in fiscal Q2 2023 and 28% of the consolidated revenue in Q2 of last year. Revenue contributed by JMB represented 21% of the consolidated revenues for fiscal Q2 of 2023 compared to 25% in Q2 of last year. For the six-month period, our revenues decreased 3% to $3.85 billion from $3.96 billion in the same year-ago period. The decrease was due to a decrease in gold ounces sold and lower average selling prices of gold and silver, partially offset by an increase in silver ounces sold. The DTC segment contributed 23% and 27% of the consolidated revenue for the six months ended December 31, 2022 and 2021, respectively. Revenue contributed by JMB represented 21% of the consolidated revenues for the six-month period ended December 31, 2022, compared to 24% in the same year-ago period. Gross profit for fiscal Q2 2023 decreased 3% to $64 million, or 3.28% of revenue, from 65.9 million or 3.39% of revenue in Q2 of last year. The decrease in gross profit was due to lower gross profits earned from the wholesale sales and ancillary services and DTC segments. Gross profit contributed by the DTC segment represented 57% of the consolidated gross profit in fiscal Q2 2023 compared to 56% in the same year-ago period. Gross profit contributed by JMB represented 51% of the consolidated gross profit in fiscal Q2 2023 compared to 45% in Q2 of last year. For the six-month period, gross profit increased 15% to $140.6 million, or 3.65% of revenue, from 121.9 million or 3.08% of revenue in the same year-ago period. The gross profit increase was due to higher gross profits earned from the wholesale sales and ancillary services and DTC segments. Gross profit contributed by the DTC segment represented 56% of the consolidated gross profit in the six-month period ended December 31, 2022 compared to 55% in the same year-ago period. Gross profit contributed by JMB represented 49% and 45% of consolidated gross profit for the six months ended December 31, 2022 and 2021, respectively. SG&A expenses for fiscal Q2 2023 increased 11% to $20.8 million from $18.7 million in Q2 of last year. The increase was primarily due to an increase in compensation expense, including performance-based accruals of $1.5 million, higher advertising costs of $1.2 million, an increase in insurance costs of $0.8 million, and an increase in computer-related expenses of $0.3 million, partially offset by lower consulting and professional fees of $1.7 million. For the six-month period, SG&A expenses increased 9% to $38.6 million from $35.4 million in the same year-ago period. The increase was primarily due to an increase in compensation expense, including performance-based accruals, of 2.5 million, higher advertising costs of 1.9 million, an increase in computer-related expenses of 0.4 million, an increase in insurance costs of 0.2 million, partially offset by lower consulting and professional fees of 2.3 million. Depreciation and amortization expense for fiscal Q2 2023 decreased 61% to $3.3 million from $8.3 million in Q2 of last year. The decrease was primarily due to a $5 million decrease in amortization of acquired intangibles related to J&B. For the six-month period, depreciation and amortization expense decreased 61% to $6.4 million from $16.5 million in the same year-ago period. The decrease was primarily due to a $10.1 million decrease in amortization of acquired intangibles related to JMV. Interest income for fiscal Q2 2023 decreased 5% to $5 million from $5.3 million in Q2 of last year. The aggregate decrease in interest income was primarily due to lower interest income earned by our secured lending segment, offset by higher Other Finance Products income. For the six-month period, interest income decreased 7% to $10.1 million from $10.8 million in the same year-ago period. The aggregate decrease in interest income was primarily due to lower interest income earned by our secured lending segment and lower other finance product income. Interest expense for fiscal Q2 2023 increased 34% to $7.2 million from $5.4 million in Q2 of last year. The increase was primarily driven by $1.2 million associated with the company's trading credit facility and the AMCF notes, including amortization of debt issuance costs, $0.7 million related to product financing arrangements, $0.2 million in interest associated with liabilities on borrowed metals, and this was offset by a decrease of $0.2 million of loan servicing fees. For the six-month period, interest expense increased 23% to $13.4 million from $10.9 million in the same year-ago period. The increase was primarily driven by $1.8 million associated with our trading credit facility and the AMCF notes, including amortization of debt issuance costs, $0.8 million related to product financing arrangements, $0.3 million in interest associated with liabilities on borrowed metals, and this was offset by a decrease of $0.4 million of loan servicing fees. Earnings from equity method investments in Q2 2023 increased 283% to $4.7 million from $1.2 million in the same year-ago quarter. The net increase was primarily due to our additional 40% ownership interest in Silver Gold Bull, which was acquired in June 2022. For the six-month period, earnings from equity method investments increased 171% to $7.3 million from $2.7 million in the same year-ago period. The net increase was primarily due to our additional 40% ownership interest in Silver Gold Bull, which we acquired in June 2022. Net income attributable to the company for the second quarter of fiscal 2023 totaled $33.5 million, or $1.35 per diluted share. This compares to net income attributable to the company of $31.8 million, or $1.30 per diluted share, in Q2 of last year, as adjusted for the effect of the two-for-one stock split in June 2022. Our diluted EPS for the fiscal second quarter of 2023 is based on weighted average diluted shares outstanding of $24.7 million, compared with 24.4 million weighted average diluted shares outstanding during the second quarter of last year, as adjusted for the effect of the two-for-one stock split that occurred in June 2022. For the six-month period, net income attributable to the company totaled $78.6 million, or $3.18 per diluted share, which compares to net income attributable to the company of $57.8 million or $2.39 per diluted share in the same year-ago period, as adjusted for the effect of the two-for-one stock split that occurred in June 2022. Our diluted EPS for the six-month period is based on weighted average diluted shares outstanding of $24.7 million, compared with 24.2 million weighted average diluted shares outstanding during the same year-ago period, which has been adjusted for the effect of the two-for-one stock split that occurred in June 2022. Adjusted net income before provision for income taxes, a non-GAAP financial measure, which excludes acquisition expenses, amortization, and depreciation, for Q2 fiscal 2023 totaled $46.5 million, a decrease of 5% compared to $49 million in the same year-ago quarter. Adjusted net income before provision for income taxes for the six-month period totaled $107.7 million, a 20% increase from $90.1 million in the same year-ago period. EBITDA, a non-GAAP liquidity measure for Q2 fiscal 2023, totaled $48.7 million, a 1% decrease compared to $49.1 million in Q2 fiscal 2022. EBITDA for the six-month period totaled $110.9 million, a 23% increase compared to $90.1 million in the same year-ago period. Turning to our balance sheet, at quarter end, we had $72.5 million of cash compared to $37.8 million at the end of last fiscal year 2022. Our tangible net worth at the end of the quarter was $371.6 million up from $321.6 million at the end of the prior fiscal year. Our AMCF notes have a maturity date of December 15, 2023, and are now reported as a current liability of $94.5 million on our balance sheet. Finally, as we announced in a prior press release, AMAR's Board of Directors reaffirmed its previously announced regular quarterly cash dividend policy of $0.20 per common share, which the company paid in January. It is expected that the next quarterly dividend will be declared and paid in April 2023. The declaration of regular cash dividends in the future is subject to the determination each quarter by the Board of Directors based on a number of factors. including the company's financial performance, available cash resources, cash requirements, and the alternative uses of cash and our applicable bank covenants. That completes my financial summary. Now I will turn the call over to Thor, who will provide an update on our key operating metrics. Thor?