Good morning, and thank you for joining us today for our webcast announcing U.S. Global Investors Results for Fiscal Year 2019. I'm Holly Schoenfeldt. If you have any questions during the webcast, you can enter them in the questions area of the control panel side bar, which is normally to the right of your screen. Also, you may download a PDF of today's slides by clicking on the red handout button. The presenters for today's program are Frank Holmes, U.S. Global Investors’ CEO and Chief Investment Officer; Lisa Callicotte, Chief Financial Officer; and myself, Holly Schoenfeldt, Marketing and Public Relations Manager. During this webcast, we may make forward-looking statements about our relative business outlook. Any forward-looking statements and all other statements made during this webcast that don't pertain to historical facts are subject to risks and uncertainties that may materially affect actual results. Please refer to our press release and corresponding Form 10-K filing for more detail on factors that could cause actual results to differ materially from any described today in forward-looking statements. Any such statements are made as of today, and U.S. Global accepts no obligation to update them in the future. And moving on to Slide 4, quickly, about U.S. Global Investors. We are an innovative investment manager with vast experience in global markets and specialized sectors, founded as an investment club. The company became a registered investment adviser in 1968 and has a long-standing history of global investing and launching first-of-their-kind investment products, including the first no-load gold fund. U.S. Global is well known for expertise in gold and precious metals, natural resources and emerging markets. And now let's go to Frank Holmes, CEO and CIO, for an overview of the period. Frank?

Thank you, Holly. So when you look at the volatility of GROW stock, the two factors that drives that, in the 30 years, it appears, the history of the company are fund flows, are very significant. The direction of gold has a big impact. And now it's becoming also our investments, which we'll talk about that. And Lisa Callicotte, our CFO, will explain how some accounting changes have created volatility in our revenues and our cash flow or income statement, it sort of flows through. And this event has also taken place for other companies. But it's really, the direction of gold has been significant, fund flows is the real underpinning and there's investments. And so in that context, we strive to be that go-to stock for exposure in emerging markets resources. And gold, no doubt, and digital currencies. We're debt free. We have a strong balance sheet with a reflexive cost structure and monthly dividend return on equity discipline. We've been through very, very challenging times. Next slide, please. In this whole industry, and I'm not going to comment on that, the mutual fund industry as a whole. But I wanted to take this moment during this presentation to thank the Royce Fund, Perritt and other people that have been shareholders in, and maintained in our company. In particular, the other people that are in the mutual funds world, they've also experienced these sorts of challenges. And the next slide, please. So we consistently paid a dividend for 10 years. Our yield is modest. And we continue to work on everything we can do to improve our revenue and our cash flow, to maintain this discipline of being able to pay dividend. Next, please. The Board approved the repurchase of up to $2.75 million of outstanding common stock in…

This is still your section but...

Well, you want to talk about insights, that we're -- you're working on speaking at conferences and from television or going on to tell the story of what's happening in global markets, et cetera. Next, please. So the one-day volatility, as you can see, for bullion and the S&P are approximately the same whereas bitcoin, Ethereum, substantially greater. And there's still yet to be an ETF that allows you to buy bitcoin. The greatest concern we discovered couple of years ago was AML, anti-money laundering risks, et cetera. And so that's why we made investment in HIVE Blockchain, which has been a roller coaster event. Next, please. So major events are moving the price of bitcoin. It went through this, a couple of years ago, from a $7,000 up to $19,000, down to $3,000. Now it's back to $10,400. It's interesting that it peaked when the Chicago Board came up with, commodities exchange came out with their futures market. That was the peak in bitcoin. And the bottom took place when we had, JPMorgan was kept knocking bitcoin as a bad investment, and that bottom took place when they launched their stablecoin this year in February. And we've seen a modest climb at the beginning and then it start to accelerate. And then we had Facebook announced their global Libra coin. And there was bitcoin, then it explode on the upside. So it's interesting for me to share with all of you is that both Facebook and Google stopped allowing any type of advertising on their platforms while Facebook was busy creating their own stablecoin, and JPMorgan kept knocking digital money, well, until they came out with their stable coin. So these are positive trends that are taking place in that crypto space. Next, please. And what's important for me…

Thank you, Frank. Good morning. Before I summarize the results of operations, I'd like to discuss an accounting pronouncement that we adopted this year. Slide 44 notes changes in the accounting rules related to investments that have and are expected to continue to cause our earnings to be more volatile. We adopted accounting standards ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, effective July 1, 2018. This amended the guidance on the classification and measurement of investments and equity securities and certain disclosures. Starting this fiscal year, some of our corporate investments were accounted for differently than in the past. There is no longer an available-for-sale classification for equity securities. As part of the adoption of this new standard, we may require cumulative effect adjustment to reclassify $3.1 million in unrealized net gains and $1 million in related deferred tax expense out of accumulated comprehensive income and into retained earnings. Effective July 1, 2018, unrealized changes in our fair value of these investments, formerly classified as available-for-sale, are reported through earnings rather than equity. This includes any changes in the market value of our investment in HIVE. The related and realized losses for, on securities formerly classified as AFS for the year June 20, 2019, and was approximately $2 million. And this would have been in comprehensive income in the prior year, but this year was included in investment income. Due to the accounting change, it doesn't matter if the investments are short or long term in nature. The change in market value will be recorded quarterly, causing income to be more volatile. Slide 45 summarizes our investment in HIVE. As of June 30, 2019, we own 10 million shares of HIVE, which is approximately 3.1% of the outstanding shares, and it had a value of $3.6…

Thank you, Lisa. So as you can see, a majority of our mutual fund assets are in emerging markets and natural resources while 33% are in domestic equities and fixed income. As for distribution, more than ¾ of assets come from retail investors with 18% coming from institutional investors. Our sales and marketing efforts have continued to focus on our mutual funds, including those concentrated on gold, natural resources and emerging markets as well as our exchange traded funds. The company and our funds continue to receive an invaluable amount of viral publicity gained through media interview. Frank Holmes often shares his insights with financial outlets like Fox Business, Bloomberg Radio and Kitco News, just to name a few. We also continue to receive recommendations by influential financial newsletter writers as well along with sharing and syndication of our award-winning original content by third-party publishers. The newsletters have loyal followings and receive millions of visitors each month. Frank Holmes' CEO blog, Frank Talk, continues to grow in popularity as well. His commentary is often featured by prominent publications including Forbes, Seeking Alpha, Kitco and equities.com, all with millions of monthly visitors. One of our core values at U.S. Global is curiosity to learn and improve. We believe that providing educational materials to investors is one of many ways to achieve this. And some of our a widely read pieces include the What's Driving Energy? handout pictured here along with our Fear Trade and Love Trade white paper. Both of which are available for download on our website usfunds.com. Kitco News, the biggest gold website in the world with an audience of over 30 million monthly visitors in partnership with thestreet.com continues to feature the Gold Game Film show with Frank Holmes' gold market analysis. Since the show's beginning, 168 episodes…

Frank, I'd like to direct this first one to you which says, if the U.S. recession and a bear market is imminent, how might this impact GROW?

Well, the most important part for us is how well does our products grow, and bad news is good news. And that is the central banks around the world have all gone to pushing for negative real interest rates. And this is very good for gold, and we have a product, GO GOLD, which has tremendous global reach. And the reason why I say that is because the -- all the regulations in the past 20 years, you've seen that foreigners cannot buy mutual funds in the U.S. They used to be able to. And -- but they can go and buy a gold equity ETFs on the New York Stock Exchange. So if they're in Germany or they're in Hong Kong or Singapore, so that global reach means that we have the best quant approach to picking gold stocks with stellar performance. I think that, that has the capacity to be a big in lower asset class. So the worry of a slowdown globally just means more money printing and lower interest rates, which is a big factor for propelling gold substantially higher. We have now -- I think it's $17 trillion of government bonds around the world with negative rates. We have -- the U.S. looks like it's going to be dropping out rates by 100 basis points over the next 9 months. It's unprecedent that you have a president, it's a question I also asked yesterday at the conference, that looks at the stock exchange as a barometer of future global -- for future economic growth and job creation to is he doing well or not. And no ever -- no other president has ever done that was the responses I received yesterday. From people that worked in the administrations going back to President Clinton and Obama administration and another one who worked in the Reagan administration and the Bush administration, none of them said that they saw that Reagan or anyone really talked about the stock market as a future part. So I think that you're going to see President Trump's going to do everything he can to make sure the stock market's doing well, which means the economy is doing well. And we have -- Holly, what really shocked me yesterday, usually, when we have such big debt loads in America and deficit spending, it's attributed to either being in a recession or being at war. Those 2 factors usually drive massive deficit spending and printing of money. We're in neither, and we have record deficit spending and record debt levels. So if we do get that recession, then the debasement of currencies, just like the Black Box CIO talked today, we're going to see gold propel higher, and I think we're positioned with good products like GOAU to really perform well.

Great. Thank you, Frank. I have another question here that may be Lisa can address. It says that previously you've mentioned owning your own building along with plans to rent out the space to more tenants. Is that still the plan?

Yes. We've got a couple of -- sorry. Go ahead, Lisa.

Fine, go ahead, Frank.

No. Lisa, go ahead.

Okay. We do have a couple of tenants right now. And then in October, we're expecting another one. So, even though these are kind of small spaces that we are renting out, we are able to offset some of our occupancy costs by renting that out. So we are keeping our options open and kind of considering additional tenants.

Great. I think that answers it. Frank, we have time for one more question. So I'm going to direct this at you. It says, in the presentation this morning, you discussed the struggle faced by mutual funds along with the great success of your GOAU ETF. And with that in mind, do you have plans to shift your focus at all from mutual funds, focusing more on that current ETF, your current ETF lineup or even new ETF products?

Well, I think the growth in mutual fund industry is coming through acquisitions. The ability to get organic growth is that you basically have to give away your funds. And the regulatory burden and cost when I moved to Texas 30 years ago and bought U.S. Global, the cost of waiving all your fees, because we had a money fund we did that with successfully, it's just too expensive. It's just an outrageously expensive exercise. And so we're going to focus on specialty products. We're going to keep continuously taking a look for acquisitions as I've done in New York is kind of see bankers that specialize boutiques in acquisitions and look for these types of products. In talking to people yesterday, when they go to launch a product, I thought it was interesting that they usually get a family officer, a hedge fund, that puts up at least $100 million. Because you can't get on these platforms unless you have like $50 million and you're trading $1 million a day of stock. So you're seeing more and more barriers to entry within the industry itself, and that's making the bigger challenge just coming with ETFs. So you have to have, if we go out with a new product, then we have to go get some real sponsors that believe in that vision, like luxury goods, which we're looking at the launch. But it's such a cost to, and it's very expensive and difficult. It's difficult doing marketing of these products. So mutual funds, it's hard to grow organically. So your best thing is to go and acquire and roll them into your assets, and so we're pursuing that, and, b, is the focus on GOAU. It should be a $1 billion product. We had lots of creates yesterday, again,…

Wonderful. Thank you, Frank. And that concludes U.S. Global Investors’ webcast for fiscal year 2019. This presentation will be available on our website at usfunds.com. Thank you all for your participation today.