In This Article:
Release Date: February 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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A-Mark Precious Metals Inc (NASDAQ:AMRK) reported a 32% increase in revenues for fiscal Q2 2025, reaching $2.742 billion, driven by higher average selling prices of gold and silver.
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The company is nearing completion of its facility expansion and logistic initiatives at A-Mark Global Logistics in Las Vegas, which is expected to enhance operational efficiency.
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A-Mark Precious Metals Inc (NASDAQ:AMRK) has entered into a definitive agreement to acquire Spectrum Group International, expanding its presence into premium collectible markets and higher-margin luxury markets.
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The DTC segment showed strong performance, contributing 21% of consolidated revenue in fiscal Q2 2025, up from 18% in the previous year.
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The number of new customers in the DTC segment increased by 25% year-over-year, indicating successful marketing efforts and customer acquisition strategies.
Negative Points
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Gross profit for fiscal Q2 2025 decreased by 3% to $44.8 million, primarily due to lower profits from the wholesale sales and ancillary services segment.
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SG&A expenses increased by 15% to $25.8 million, driven by higher consulting and professional fees, advertising costs, and compensation expenses.
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Earnings from equity method investments decreased significantly, resulting in a loss of $2.4 million in Q2 2025 compared to earnings of $0.8 million in the previous year.
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Net income attributable to the company decreased to $6.6 million or $0.27 per diluted share, down from $13.8 million or $0.57 per diluted share in Q2 of the previous year.
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The number of secured loans decreased by 28% from the previous year, indicating potential challenges in the secured lending segment.
Q & A Highlights
Q: Greg, can you provide some historical context for the current low volatility and elevated gold prices? A: Greg Roberts, CEO: We are in uncharted waters with gold prices consistently reaching new highs. The current situation is reminiscent of 1980, particularly in silver, where market flow exceeded demand. Despite these challenges, A-Mark is effectively managing its operations and maintaining strong relationships with refiners.
Q: How should we view the countercyclicality of the numismatic and wine efforts from the SGI deal? A: Greg Roberts, CEO: Spectrum Wine Auctions is a collectible but not directly related to numismatics. However, we see synergies in cross-selling bullion products to Stax's customer base and leveraging JM Bullion's success in selling numismatic coins. Stax's revenue mix is impressive, and we believe their higher margins will complement A-Mark, especially when bullion margins are low.