| Segment and Geographic Information |
SEGMENTS AND GEOGRAPHIC INFORMATION
The Company evaluates segment reporting in accordance with FASB ASC 280, Segment Reporting, each reporting period, including evaluating the organizational structure and the reporting package that is reviewed by the Chief Operating Decision Makers (“CODM”). The Company's operations are organized under three business segments — Wholesale Trading & Ancillary Services, Secured Lending, and Direct Sales.
Revenue
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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March 31, 2019 |
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March 31, 2018 |
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March 31, 2019 |
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March 31, 2018 |
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Revenue by segment (1)(2)
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Wholesale Trading & Ancillary Services (3)
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$ |
1,251,385 |
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$ |
1,977,273 |
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$ |
3,893,886 |
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$ |
5,782,135 |
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Direct Sales |
|
15,601 |
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(a) |
17,690 |
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(b) |
39,102 |
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(c) |
57,356 |
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(d) |
Total revenue |
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$ |
1,266,986 |
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$ |
1,994,963 |
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$ |
3,932,988 |
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$ |
5,839,491 |
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_________________________________ |
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(1) Intercompany purchases from and sales to the Direct Sales segment are transacted at Wholesale Trading & Ancillary Services segment's prices, which is consistent with arms-length transactions with third-parties. |
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(2) The Secured Lending segment earns interest income from its lending activity and earns no revenue from the sales of precious metals. Therefore, no amounts are shown for the Secured Lending segment in the above table. |
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(3) The elimination of intercompany sales are reflected in the Wholesale Trading & Ancillary Services segment. |
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(a) Includes $0.3 million of intercompany sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment. |
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(b) Includes $4.3 million of intercompany sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment. |
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(c) Includes $0.6 million of intercompany sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment. |
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(d) Includes $21.9 million of intercompany sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment. |
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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March 31, 2019 |
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March 31, 2018 |
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March 31, 2019 |
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March 31, 2018 |
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Revenue by geographic region
(as determined by the shipping address or where the services were performed):
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United States |
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$ |
1,148,787 |
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$ |
1,851,752 |
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$ |
3,493,306 |
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$ |
5,483,566 |
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Europe |
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47,997 |
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77,580 |
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186,758 |
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|
204,960 |
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North America, excluding United States |
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67,637 |
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64,463 |
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246,306 |
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146,237 |
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Asia Pacific |
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2,295 |
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|
684 |
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5,252 |
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2,410 |
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Africa |
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— |
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— |
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1 |
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1 |
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Australia |
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270 |
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|
484 |
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1,365 |
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2,317 |
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Total revenue |
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$ |
1,266,986 |
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$ |
1,994,963 |
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$ |
3,932,988 |
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$ |
5,839,491 |
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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March 31, 2019 |
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March 31, 2018 |
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March 31, 2019 |
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March 31, 2018 |
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Gross profit by segment(1)
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Wholesale Trading & Ancillary Services |
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$ |
6,934 |
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$ |
6,748 |
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$ |
21,150 |
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$ |
19,561 |
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Direct Sales |
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1,782 |
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|
679 |
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4,358 |
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4,088 |
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Total gross profit |
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$ |
8,716 |
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$ |
7,427 |
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$ |
25,508 |
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$ |
23,649 |
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Gross margin percentage by segment(1)
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Wholesale Trading & Ancillary Services |
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0.554 |
% |
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0.341 |
% |
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0.543 |
% |
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0.338 |
% |
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Direct Sales |
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11.422 |
% |
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3.838 |
% |
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11.145 |
% |
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7.127 |
% |
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Weighted average gross margin percentage |
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0.688 |
% |
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0.372 |
% |
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0.649 |
% |
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0.405 |
% |
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_________________________________ |
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(1) The Secured Lending segment earns interest income from its lending activity and earns no gross profit from the sales of precious metals. Therefore, no amounts are shown for the Secured Lending segment in the above table. |
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Operating income and (expenses)
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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March 31, 2019 |
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March 31, 2018 |
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March 31, 2019 |
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March 31, 2018 |
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Operating income and (expenses) by segment |
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Wholesale Trading & Ancillary Services |
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Selling, general and administrative expenses |
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$ |
(5,618 |
) |
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$ |
(5,216 |
) |
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$ |
(16,525 |
) |
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$ |
(16,002 |
) |
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Interest income |
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$ |
2,052 |
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$ |
1,564 |
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$ |
6,458 |
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$ |
3,620 |
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Interest expense |
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$ |
(2,401 |
) |
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$ |
(1,983 |
) |
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$ |
(7,255 |
) |
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$ |
(5,375 |
) |
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Other income, net |
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$ |
337 |
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$ |
67 |
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$ |
1,382 |
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$ |
817 |
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Secured Lending |
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Selling, general and administrative expenses |
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$ |
(394 |
) |
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$ |
(571 |
) |
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$ |
(1,083 |
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$ |
(1,302 |
) |
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Interest income |
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$ |
2,755 |
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$ |
2,523 |
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$ |
7,552 |
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$ |
6,896 |
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Interest expense |
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$ |
(1,838 |
) |
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$ |
(1,433 |
) |
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$ |
(4,850 |
) |
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$ |
(3,854 |
) |
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Other income, net |
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$ |
— |
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$ |
— |
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$ |
24 |
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$ |
— |
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Direct Sales |
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Selling, general and administrative expenses |
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$ |
(2,246 |
) |
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$ |
(3,636 |
) |
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$ |
(6,472 |
) |
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$ |
(8,444 |
) |
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Interest expense |
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$ |
— |
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$ |
(226 |
) |
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$ |
(342 |
) |
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$ |
(505 |
) |
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Other expense, net |
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— |
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— |
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$ |
(157 |
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$ |
— |
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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|
March 31, 2019 |
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March 31, 2018 |
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March 31, 2019 |
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March 31, 2018 |
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Net (loss) income before provision for income taxes by segment |
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Wholesale Trading & Ancillary Services |
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$ |
1,304 |
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$ |
1,180 |
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$ |
5,210 |
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$ |
2,621 |
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Secured Lending |
|
523 |
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|
519 |
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|
1,643 |
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|
1,740 |
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Direct Sales |
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(464 |
) |
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(3,183 |
) |
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(2,613 |
) |
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(4,861 |
) |
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Total net income (loss) before provision for income taxes
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$ |
1,363 |
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$ |
(1,484 |
) |
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$ |
4,240 |
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$ |
(500 |
) |
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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|
|
March 31, 2019 |
|
March 31, 2018 |
|
March 31, 2019 |
|
March 31, 2018 |
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Depreciation and amortization by segment |
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Wholesale Trading & Ancillary Services |
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$ |
(386 |
) |
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$ |
(386 |
) |
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$ |
(1,177 |
) |
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$ |
(1,170 |
) |
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Direct Sales |
|
(304 |
) |
|
(296 |
) |
|
(911 |
) |
|
(824 |
) |
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Total depreciation and amortization |
|
$ |
(690 |
) |
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$ |
(682 |
) |
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$ |
(2,088 |
) |
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$ |
(1,994 |
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Advertising expense
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in thousands |
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Three Months Ended |
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Nine Months Ended |
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|
March 31, 2019 |
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March 31, 2018 |
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March 31, 2019 |
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March 31, 2018 |
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Advertising expense by segment |
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Wholesale Trading & Ancillary Services |
|
$ |
(115 |
) |
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$ |
(157 |
) |
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$ |
(383 |
) |
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$ |
(441 |
) |
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Secured Lending |
|
(5 |
) |
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(7 |
) |
|
(9 |
) |
|
(26 |
) |
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Direct Sales |
|
(499 |
) |
|
(797 |
) |
|
(1,465 |
) |
|
(2,070 |
) |
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Total advertising expense |
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$ |
(619 |
) |
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$ |
(961 |
) |
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$ |
(1,857 |
) |
|
$ |
(2,537 |
) |
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in thousands |
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March 31, 2019 |
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June 30, 2018 |
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Precious metals held under financing arrangements by segment |
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Wholesale Trading & Ancillary Services |
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$ |
212,622 |
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$ |
262,566 |
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Total precious metals held under financing arrangements |
|
$ |
212,622 |
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$ |
262,566 |
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in thousands |
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March 31, 2019 |
|
June 30, 2018 |
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Inventories by segment |
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Wholesale Trading & Ancillary Services |
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$ |
258,937 |
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$ |
272,034 |
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Direct Sales |
|
7,482 |
|
|
8,082 |
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Total inventories |
|
$ |
266,419 |
|
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$ |
280,116 |
|
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in thousands |
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March 31, 2019 |
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June 30, 2018 |
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Inventories by geographic region |
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United States |
|
$ |
253,074 |
|
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$ |
273,008 |
|
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Europe |
|
3,797 |
|
|
1,965 |
|
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North America, excluding United States |
|
9,225 |
|
|
4,976 |
|
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Asia |
|
323 |
|
|
167 |
|
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Total inventories |
|
$ |
266,419 |
|
|
$ |
280,116 |
|
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|
|
|
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in thousands |
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|
March 31, 2019 |
|
June 30, 2018 |
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Assets by segment |
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Wholesale Trading & Ancillary Services |
|
$ |
528,277 |
|
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$ |
616,522 |
|
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Secured Lending |
|
116,312 |
|
|
111,304 |
|
|
Direct Sales |
|
13,183 |
|
|
15,175 |
|
|
Total assets |
|
$ |
657,772 |
|
|
$ |
743,001 |
|
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|
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in thousands |
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|
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|
March 31, 2019 |
|
June 30, 2018 |
|
Assets by geographic region |
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United States |
|
$ |
643,043 |
|
|
$ |
733,131 |
|
|
Europe |
|
5,181 |
|
|
4,727 |
|
|
North America, excluding United States |
|
9,225 |
|
|
4,976 |
|
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Asia |
|
323 |
|
|
167 |
|
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Total assets |
|
$ |
657,772 |
|
|
$ |
743,001 |
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in thousands |
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|
March 31, 2019 |
|
June 30, 2018 |
|
Long-term assets by segment |
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Wholesale Trading & Ancillary Services |
|
$ |
32,597 |
|
|
$ |
31,328 |
|
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Secured Lending |
|
197 |
|
|
102 |
|
|
Direct Sales |
|
3,685 |
|
|
4,588 |
|
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Total long-term assets |
|
$ |
36,479 |
|
|
$ |
36,018 |
|
|
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|
|
|
|
|
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|
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in thousands |
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|
|
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|
|
March 31, 2019 |
|
June 30, 2018 |
|
Long-term assets by geographic region |
|
|
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United States |
|
$ |
36,426 |
|
|
$ |
35,965 |
|
|
Europe |
|
53 |
|
|
53 |
|
|
Total long-term assets |
|
$ |
36,479 |
|
|
$ |
36,018 |
|
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Capital Expenditures for Property and Equipment
|
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|
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|
|
|
|
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|
in thousands |
|
|
|
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|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
March 31, 2019 |
|
March 31, 2018 |
|
March 31, 2019 |
|
March 31, 2018 |
|
Capital expenditures on plant, property and equipment by segment |
|
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|
|
Wholesale Trading & Ancillary Services |
|
$ |
26 |
|
|
$ |
404 |
|
|
$ |
164 |
|
|
$ |
673 |
|
|
Secured Lending |
|
91 |
|
|
— |
|
|
91 |
|
|
— |
|
|
Direct Sales |
|
35 |
|
|
— |
|
|
35 |
|
|
148 |
|
|
Total capital expenditures on property and equipment |
|
$ |
152 |
|
|
$ |
404 |
|
|
$ |
290 |
|
|
$ |
821 |
|
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|
|
|
|
|
|
|
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Goodwill and Intangible Assets
|
|
|
|
|
|
|
|
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|
|
in thousands |
|
|
|
|
|
|
|
March 31, 2019 |
|
June 30, 2018 |
|
Goodwill and Intangibles by segment |
|
|
|
|
|
Wholesale Trading & Ancillary Services |
|
$ |
12,196 |
|
|
$ |
12,516 |
|
|
Direct Sales |
|
2,790 |
|
|
3,226 |
|
|
Total goodwill and intangible assets |
|
$ |
14,986 |
|
|
$ |
15,742 |
|
|
|