Quarterly report pursuant to Section 13 or 15(d)

Segments and Geographic Information

v3.20.1
Segments and Geographic Information
9 Months Ended
Mar. 31, 2020
Segment Reporting [Abstract]  
Segments and Geographic Information

18.

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. The Company's operations are organized under three business segments — Wholesale Trading & Ancillary Services, Secured Lending, and Direct Sales. (See Note 1 for a description of the types of products and services from which each reportable segment derives its revenues.)

Revenue

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

Revenue by segment(1)(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services(3)

 

$

1,234,165

 

 

 

$

1,251,385

 

 

 

$

3,733,252

 

 

 

$

3,893,886

 

 

Direct Sales

 

 

24,557

 

(a)

 

 

15,601

 

(b)

 

 

62,074

 

(c)

 

 

39,102

 

(d)

 

 

$

1,258,722

 

 

 

$

1,266,986

 

 

 

$

3,795,326

 

 

 

$

3,932,988

 

 

 

(1)

Inter-segment 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.

(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.

(3)

The elimination of inter-segment sales are reflected in the Wholesale Trading & Ancillary Services segment.

(a)

Includes $9.7 million of inter-segment sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment.

(b)

Includes $0.3 million of inter-segment sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment.

(c)

Includes $22.8 million of inter-segment sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment.

(d)

Includes $0.6 million of inter-segment sales from the Direct Sales segment to the Wholesale Trading & Ancillary Services segment.

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Revenue by geographic region (as determined by the shipping

   address or where the services were performed):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

1,072,071

 

 

 

$

1,148,787

 

 

 

$

2,958,735

 

 

 

$

3,493,306

 

Europe

 

 

59,367

 

 

 

 

47,997

 

 

 

 

214,777

 

 

 

 

186,758

 

North America, excluding United States

 

 

110,676

 

 

 

 

67,637

 

 

 

 

577,908

 

 

 

 

246,306

 

Asia Pacific

 

 

14,291

 

 

 

 

2,295

 

 

 

 

33,226

 

 

 

 

5,252

 

Africa

 

 

 

 

 

 

 

 

 

 

31

 

 

 

 

1

 

Australia

 

 

2,317

 

 

 

 

270

 

 

 

 

10,649

 

 

 

 

1,365

 

 

 

$

1,258,722

 

 

 

$

1,266,986

 

 

 

$

3,795,326

 

 

 

$

3,932,988

 

Gross Profit and Gross Margin Percentage

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Gross profit by segment(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

19,749

 

 

 

$

6,934

 

 

 

$

33,106

 

 

 

$

21,150

 

Direct Sales

 

 

2,726

 

 

 

 

1,782

 

 

 

 

5,840

 

 

 

 

4,358

 

Total gross profit

 

$

22,475

 

 

 

$

8,716

 

 

 

$

38,946

 

 

 

$

25,508

 

Gross margin percentage by segment(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

 

1.600

%

 

 

 

0.554

%

 

 

 

0.887

%

 

 

 

0.543

%

Direct Sales

 

 

11.101

%

 

 

 

11.422

%

 

 

 

9.408

%

 

 

 

11.145

%

Weighted average gross margin percentage

 

 

1.786

%

 

 

 

0.688

%

 

 

 

1.026

%

 

 

 

0.649

%

 

(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.

Operating income and (expenses)

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Operating income (expense) by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(7,973

)

 

 

$

(5,618

)

 

 

$

(19,253

)

 

 

$

(16,525

)

Interest income

 

$

2,376

 

 

 

$

2,052

 

 

 

$

6,868

 

 

 

$

6,458

 

Interest expense

 

$

(2,946

)

 

 

$

(2,401

)

 

 

$

(8,215

)

 

 

$

(7,255

)

Other income, net

 

$

278

 

 

 

$

373

 

 

 

$

392

 

 

 

$

1,436

 

Unrealized income (loss) on foreign exchange

 

$

(45

)

 

 

$

(36

)

 

 

$

(42

)

 

 

$

(54

)

Secured Lending

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(666

)

 

 

$

(394

)

 

 

$

(1,398

)

 

 

$

(1,083

)

Interest income

 

$

3,591

 

 

 

$

2,755

 

 

 

$

11,099

 

 

 

$

7,552

 

Interest expense

 

$

(2,105

)

 

 

$

(1,838

)

 

 

$

(7,059

)

 

 

$

(4,850

)

Other income, net

 

$

186

 

 

 

$

 

 

 

$

275

 

 

 

$

24

 

Direct Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

$

(1,749

)

 

 

$

(2,246

)

 

 

$

(5,877

)

 

 

$

(6,472

)

Interest expense

 

$

 

 

 

$

 

 

 

$

 

 

 

$

(342

)

Other income (expense), net

 

$

 

 

 

$

 

 

 

$

(219

)

 

 

$

(157

)

 

Net income (loss) before provision for income taxes

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Net income (loss) before provision for income taxes by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

11,439

 

 

 

$

1,304

 

 

 

$

12,856

 

 

 

$

5,210

 

Secured Lending

 

 

1,006

 

 

 

 

523

 

 

 

 

2,917

 

 

 

 

1,643

 

Direct Sales

 

 

977

 

 

 

 

(464

)

 

 

 

(256

)

 

 

 

(2,613

)

 

 

$

13,422

 

 

 

$

1,363

 

 

 

$

15,517

 

 

 

$

4,240

 

 

Depreciation and Amortization

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Depreciation and amortization by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

(375

)

 

 

$

(386

)

 

 

$

(1,175

)

 

 

$

(1,177

)

Secured Lending

 

 

(281

)

 

 

 

 

 

 

 

(316

)

 

 

 

 

Direct Sales

 

 

(227

)

 

 

 

(304

)

 

 

 

(726

)

 

 

 

(911

)

 

 

$

(883

)

 

 

$

(690

)

 

 

$

(2,217

)

 

 

$

(2,088

)

 

Advertising expense

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Advertising expense by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

(294

)

 

 

$

(115

)

 

 

$

(362

)

 

 

$

(383

)

Secured Lending

 

 

(6

)

 

 

 

(5

)

 

 

 

(11

)

 

 

 

(9

)

Direct Sales

 

 

(456

)

 

 

 

(499

)

 

 

 

(1,192

)

 

 

 

(1,465

)

 

 

$

(756

)

 

 

$

(619

)

 

 

$

(1,565

)

 

 

$

(1,857

)

 

Precious metals held under financing arrangements

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Precious metals held under financing arrangements by segment

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

187,005

 

 

$

208,792

 

 

Inventories

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Inventories by segment

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

382,225

 

 

$

268,383

 

Secured Lending

 

 

23,079

 

 

 

16,867

 

Direct Sales

 

 

7,825

 

 

 

7,611

 

 

 

$

413,129

 

 

$

292,861

 

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Inventories by geographic region

 

 

 

 

 

 

 

 

United States

 

$

399,645

 

 

$

280,924

 

Europe

 

 

11,273

 

 

 

3,944

 

North America, excluding United States

 

 

2,016

 

 

 

7,452

 

Asia

 

 

195

 

 

 

541

 

 

 

$

413,129

 

 

$

292,861

 

 

Total Assets

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Assets by segment

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

775,967

 

 

$

561,902

 

Secured Lending

 

 

143,467

 

 

 

130,143

 

Direct Sales

 

 

21,523

 

 

 

13,317

 

 

 

$

940,957

 

 

$

705,362

 

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Assets by geographic region

 

 

 

 

 

 

 

 

United States

 

$

926,749

 

 

$

689,287

 

Europe

 

 

11,997

 

 

 

8,082

 

North America, excluding United States

 

 

2,016

 

 

 

7,452

 

Asia

 

 

195

 

 

 

541

 

 

 

$

940,957

 

 

$

705,362

 

 

Long-term Assets

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Long-term assets by segment

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

35,886

 

 

$

32,816

 

Secured Lending

 

 

1,408

 

 

 

280

 

Direct Sales

 

 

3,984

 

 

 

3,416

 

 

 

$

41,278

 

 

$

36,512

 

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Long-term assets by geographic region

 

 

 

 

 

 

 

 

United States

 

$

41,225

 

 

$

36,459

 

Europe

 

 

53

 

 

 

53

 

 

 

$

41,278

 

 

$

36,512

 

 

Capital Expenditures for Property, Plant, and Equipment

 

in thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Nine Months Ended

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

 

 

March 31,

2020

 

 

 

March 31,

2019

 

Capital expenditures on property, plant, and equipment by segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

225

 

 

 

$

26

 

 

 

$

600

 

 

 

$

164

 

Secured Lending

 

 

4

 

 

 

 

91

 

 

 

 

76

 

 

 

 

91

 

Direct Sales

 

 

3

 

 

 

 

35

 

 

 

 

10

 

 

 

 

35

 

 

 

$

232

 

 

 

$

152

 

 

 

$

686

 

 

 

$

290

 

 

Goodwill and Intangible Assets

 

in thousands

 

 

 

 

 

 

 

 

 

 

March 31,

2020

 

 

June 30,

2019

 

Goodwill and Intangibles by segment

 

 

 

 

 

 

 

 

Wholesale Trading & Ancillary Services

 

$

11,902

 

 

$

12,087

 

Direct Sales

 

 

2,213

 

 

 

2,646

 

 

 

$

14,115

 

 

$

14,733