A-Mark Precious Metals Inc (AMRK) 2020 Q4 法說會逐字稿

Good afternoon, and welcome to A-Mark Precious Metals conference call for the fiscal fourth quarter and full year ended June 30, 2020. My name is Devin, and I will be your operator this afternoon.

Before this call, A-Mark issued its results for the fourth quarter and full year 2020 in a press release, which is available in the Investor Relations section of the company's website at amark.com. You can find a link in the Investor Relations section at the top of the home page.

Joining us for the call today are A-Mark's CEO, Greg Roberts; President, Thor Gjerdrum; and CFO, Kathleen Simpson-Taylor. Following the 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 will be available for replay via a link available in the Investor Relations section of A-Mark's website.

And now I would like to turn the call over to A-Mark's CEO, Mr. Greg Roberts. Sir, please go ahead.

Thanks, Devin, and good afternoon to everybody. Thank you for joining our fiscal fourth quarter and full year 2020 earnings call. I want to take a moment to thank our employees and our shareholders for their support in what has been a historically challenging year.

The fourth quarter capped off a truly record year for A-Mark, both from a financial results and operational efficiency standpoint. Following the global macroeconomic events in mid-March that spurred the unprecedented volatility in the precious metals market, A-Mark's fiscal fourth quarter was characterized by sustained and heightened demand and related product volumes. This consistency helped to drive sequential improvements in our key financial metrics, including a 25% increase in gross profit to $28 million and a 58% increase in net income to $17.8 million, or $2.49 per diluted share for the quarter. And full year, our net income of $30.5 million, or $4.31 per diluted share.

Putting it all together, we produced a company-wide return on equity of 18% for Q4 and 30% for the fiscal year. These figures and metrics not only demonstrate the scalability of our platform but also the incredible demand for our physical products, which increased significantly during the second half of fiscal 2020. They also reflect the attractiveness of our business model, which is structured to generate continuing revenue streams in normal market conditions and outsized profitability during volatile market periods, which we experienced in Q3 and Q4.

A real differentiator for A-Mark is our ecosystem of synergistic turnkey solutions, which has allowed us to capture significant value across the precious metals market, and enabled us to be more effectively take advantage of supply constraints and volatile market conditions like those we witnessed in the second half of the year. The strategic investments we've made over the last several years to expand capacity and operational capabilities have ideally positioned A-Mark to continue to capitalize on the current market conditions while increasing our market share and driving growth over the long term.

Before I continue, I'm going to turn the speaker over to our CFO, Kathleen Simpson-Taylor, to walk us through the financial highlights for the fourth quarter and the full fiscal year. Kathleen?

Thank you, Greg, and good afternoon, everyone. Our revenues for fiscal Q4 2020 increased 96% to $1.67 billion from $850.2 million in Q4 of last year. For the full year, our revenues increased 14% to $5.46 billion from $4.78 billion in the same year ago period. The increase for both Q4 and the full year was primarily due to an increase in the total amount of gold and silver ounces sold and higher selling prices of gold and silver. For the full year, this increase was partially offset by lower forward sales.

Gross profit for fiscal Q4 2020 increased 335% to $28 million or 1.68% of revenue from $6.5 million or 0.76% of revenue in Q4 of last year. For the full year, gross profit increased 110% to $67 million or 1.23% of revenue from $32 million or 0.67% of revenue in the same year ago period. The increase in gross profit for both Q4 and the full year was due to the higher gross profit from the Wholesale Trading & Ancillary Services and Direct Sales segments.

Now looking at our expenses. SG&A expenses for fiscal Q4 2020 increased 21% to $10.2 million from $8.4 million in Q4 of last year. The increase was primarily due to increases in compensation expense, including performance-based accruals of $1.8 million, advertising expense of $0.1 million, consulting costs of $0.2 million and computer software expense of $0.2 million. These were partially offset by decreases in operating expenses of $0.5 million associated with the company's Direct Sales segment.

For the full year, SG&A expenses increased 13% to $36.8 million from $32.5 million in the same year ago period. The increase was primarily due to increases in compensation expense, including performance-based accruals of $4.5 million, computer software expense of $0.5 million and depreciation and amortization expense of $0.4 million. These were partially offset by decreases in operating expenses of $1.1 million, associated with our Direct Sales segment and consulting expense of $0.4 million.

Interest income for fiscal Q4 2020 decreased 38% to $3.3 million from $5.3 million in the same year ago quarter. The aggregate decrease in interest income was primarily due to lower interest income earned by our Secured Lending segment. For the full year, interest income increased 10% to $21.2 million from $19.3 million in the same year ago period. The aggregate increase in interest income was primarily due to interest income earned by our Secured Lending segment and other finance product income.

Interest expense for fiscal Q4 2020 decreased 24% to $3.6 million from $4.7 million in Q4 of last year. The decrease in interest expense was primarily related to our trading credit facility and loan servicing fees, partially offset by an increase in interest expense related to our product financing arrangements and our liabilities on borrowed metals. Interest expense for the full year increased 10% to $18.9 million from $17.1 million in the same year ago period. The increase in interest expense was due to our notes payable, loan servicing fees, product financing arrangements and liabilities on borrowed metals, which was partially offset by reductions in interest expense related to our Trading Credit Facility and the Goldline Credit Facility.

Net income for the fourth quarter of fiscal 2020 totaled $17.8 million or $2.49 per diluted share this was a significant improvement compared to a net loss of $823,000 or $0.12 per diluted share in Q4 of last year. Our income tax expense for the fourth quarter of 2020 was $4 million compared to an income tax benefit of $128,000 in Q4 of last year.

For the full year, net income totaled $30.5 million or $4.31 per diluted share compared to net income of $2.2 million or $0.31 per diluted share in the same year ago period. Our income tax expense was $6.4 million for the fiscal year ended June 30, 2020, and $1 million for the fiscal year ended June 30, 2019. Our effective tax rate was 16.9% in fiscal year '20 and 31% in fiscal year '19. Our lower effective tax rate for the year ended June 30, 2020 is due primarily to the income tax benefit from the carryback of fiscal 2019 and 2018 net operating losses.

Now turning to our balance sheet. At fiscal year-end, we had $52.3 million of cash compared to $8.3 million at the end of fiscal year 2019. $26.7 million of our cash balance at fiscal year-end represented collateral for our asset-backed securitization.

Our tangible net worth at the end of the quarter was $91 million, up from $57.8 million at the end of fiscal year 2019. Last week, we expanded our existing credit facility from $220 million to $257.5 million. The expanded facility reflects the continued support from our lending partners and provides us with additional liquidity to address higher commodity prices and increased activity levels in the current environment. Additionally, I am pleased to announce that our Board of Directors approved a special dividend of $1.50 per common share. The special dividend will be paid on or about September 25, 2020, to stockholders of record as of September 21, 2020.

That completes my financial summary. Now I would like to turn the call over to Thor, who will provide an update on our key performance metrics. Thor?

Thank you, Kathleen. Our key operational metrics were strong across the board in the fourth quarter and full year fiscal 2020. Let's look at them in more detail. We sold 669,000 ounces of gold in Q4, which was up 32% from the prior quarter and up 91% from Q4 of last year. For the full year, we sold 2.2 million ounces in gold, which is up 21% from the same period last year. It was a particularly strong quarter in terms of silver sales, in which we sold 29.6 million ounces in Q4, up 15% from the prior quarter and up 136% from Q4 of last year. For the full year, we sold 90.4 million ounces of silver, which is up 34% from the same period last year.

It is important to understand these recent market conditions resulted in an expansion of premium spreads, which produced higher gross profits and gross profit percentages in the quarter. As Kathleen noted, the gross profit percentage increased from 0.76% in Q4 fiscal '19 to 1.68% in Q4 of fiscal 2020. These improved results relate primarily to the premiums earned over the spot prices. The recent conditions highlight our profit potential during periods of volatility, where the prices are trending higher or lower.

In terms of wholesale trading ticket volume, which represents the total number of product orders processed by our trading desk, we saw a 44% decrease to 27,199 tickets from our prior quarter and a 12% increase from Q4 of last year. While the ticket volume decreased as compared to prior quarter, the average order size per ticket was higher in Q4. For the full year, trading ticket volume increased 19% to 142,690 tickets from the prior year. The increase in our trading ticket volume for the year is indicative of increased trading activity due to higher demand as compared to 2019.

The third key metric we closely evaluate is inventory turn, defined as the cost of sales divided by the average inventory during the relevant period. Inventory turnovers is a measure how quickly inventories moved during the period. For the fourth quarter, our inventory turnover ratio was 4.5%, which is up 50% from 3.0% in Q4 of last year. For the full year 2020, our inventory turnover ratio increased by 6% to 17.6% from 16.6% in 2019. The increase in our inventory turnover ratio was primarily due to higher volumes of ounces sold of precious metals, partially offset by lower volume of ounces sold on forward contracts as well as higher average inventory compared to the same period last year.

And finally, the number of secured loans at the end of the quarter totaled 717, which is up 67% from the prior quarter and down 74% from Q4 of last year. The dollar value for our loan portfolio totaled $63.7 million, which was up 28% from the prior quarter, but down 49% from Q4 of last year. Typically, the number of loans increased during periods of rising precious metals prices and decreased during periods of declining precious metals prices. As you may recall, numerous CFC loans were paid off during the third quarter when the market experienced a rapid and material drop in precious metals prices, primarily in silver. As silver prices rebounded in Q4, new loans were originated and acquired, increasing both the number and value of secured loan portfolio during the fourth quarter.

That concludes my prepared remarks. I will now turn it back over to Greg to talk about the progress we've been making on our key operational initiatives. Greg?

Thank you, Thor. In addition to our record financial results and KPIs, we made significant traction on our operational plan to enhance our organizational processes, improve efficiencies and expand on our overall capacity. Our successful execution on this plan has furthered A-Mark's position as one of the leading full-service providers to the global precious metals market.

In terms of our business segments, it was certainly a momentous year for our Wholesale Trading & Ancillary Services segment. As Thor highlighted, the significant improvements in product volumes and trading activities in the second half of the year helped to drive record financial results for fiscal 2020.

The moves we made earlier in the year to strengthen our trading team and overall capabilities, such as our 24/7 portal, couldn't have been timelier. We also continue to benefit from our majority stake in the SilverTowne Mint, which has provided us with better price stability as well as access to silver products that we have been able to distribute into the market even when supplies in the market were scarce.

The SilverTowne Mint has been operating at a maximum capacity since the first few weeks of Q4, reaching production levels of more than 500,000 ounces per week. Our continued success with the Mint and their ability to operate 24/7 and the broader impacts it provides gave us the confidence to invest in new machinery, which will increase the Mint's overall capacity and product quality over the coming months.

We saw our Secured Lending segment bounced back in Q4. As Thor noted, numerous loans were paid off during Q3 when the market experienced a rapid and material drop in silver prices. But since that time, we've seen a significant increase in demand, which we believe puts us on track to return to a $100 million bullion loan portfolio by mid-fiscal 2021.

Fiscal 2020 marked a tremendous turnaround for our Direct Sales segment, notably, Goldline. The marketing programs and initiatives we implemented earlier in the year provide -- proved to be successful and the driving force in turning around the business. On top of this, the decisive measures we've implemented over the last year, optimized Goldline's cost structure and made the segment much more efficient. This was evident in the segment's reported net income for the fiscal year of $2.1 million, which was a significant improvement over their net loss of $3.6 million, reported for fiscal year 2019.

Looking ahead, our operational and financial success in the fourth quarter allowed us to enter our new fiscal year with significant operating momentum. I'm encouraged to report that the market dynamics and trends we experienced in Q4 have continued to date in the first 2 months of fiscal Q1, highlighted by sustained demand and high volatility. These factors give us optimism for the year ahead as we look to take advantage of the opportunities in front of us. We believe our strong competitive position, robust platform, expanding customer base and diversified business model will help drive growth and profitability in the years ahead.

Operator, please provide the appropriate instructions for Q&A.

(Operator Instructions) Our first question comes from the line of Andrew Scutt with ROTH Capital.

Congratulations on the extremely strong quarter, very impressive results. So my first question, just along the lines of trading volumes in the quarter, like I said, great numbers you guys reported. Do you see this continuing into the September quarter and particularly, on strength in silver that you guys saw in the quarter? Do you see that continuing on with strong silver returns year-to-date?

Yes. I mean I think in the first quarter, July and August were very busy for us. And our volumes and our ounces were extremely strong. The price of silver, generally, as it rises, we slowed down a little bit just because there is a bit of a stunt, and people that are used to buying products at $18, they slowed down a little bit when silver is $28. So I think that our market -- our business reacts a little differently to different movements in just the price of silver. Historically, we've made tremendous progress when silver drops. Currently, we're seeing a great deal of demand. And if you look at the inflows into the ETF, the SLB ETF, you're going to see in July and August, unprecedented inflows of silver.

So what we are witnessing in the current quarter is a very unusual and unprecedented demand for silver across all products, whether it be miners, whether it be the ETF and ETFs, and we have definitely seen as I said, in July and August, we saw some very good volumes. How that's going to play out in September and going forward, it's going to depend a lot on the appetite for people to add positions in the markets that we supplied as well as whether or not you see any pullbacks or any buying opportunities going forward. But I would say that the other thing, as Thor pointed out is we lost quite a few loans in Q3 when we had an incredible 48-hour period where silver went from $18 to $12, and we picked up a lot of income on trading and sale of silver, but we lost a lot of loans just due to payoffs. And what we're seeing in the last couple of months is silver is up, and we're seeing some good healthy rebound in our loan portfolio. So we never know exactly where it's going to come from or what's happening tomorrow. But like I said a moment ago, we feel really well positioned, and we feel like we're ready to take advantage of whatever the market can throw at us.

Great. Next question -- saw your comments on the SilverTowne, congrats on getting capacity up to about 500,000 ounces per week. So just doing some math here, that would equate to about a $6.5 million a quarter, which would be about 20% of the ounces you guys sell per quarter? So is that a mix you guys are targeting? Or do you have a certain contribution mix you guys are targeting in the long term?

I would say that the percentage isn't something that we focus too much on as it relates to our overall ounces because the mix of silver ounces that we sell comes from a lot of different products, not just the SilverTowne products. I think that the more impressive thing is that we are incredibly pleased with the job Jamie Meadows has done at SilverTowne. And the ability for that investment in that business of ours to ramp up from very quickly in January and February, they were probably running at about 150,000 ounces a week to where they currently are at the 500,000 a week level and their ability throughout this very challenging period that they have been running 24/7, 3 shifts a day, and they've just been able to keep the machines running. They've been able to keep the flow going. And that's really given A-Mark a huge advantage.

I think this last weekend, Labor Day weekend was the first weekend since March, where they actually were closed for 3 days. So it's just an incredible run. And then our traders' ability to move the metal necessary to the facility, the large bars that they use and have that metal showing up there every week so that Jamie can turn it into products, has just been an incredible accomplishment. I think that we've recently, as I said a few a moment ago, we've invested in a couple of new pieces of machinery that we believe are going to just continue to increase our production and make products that we've never made before there and offer them to our customers, the one specific piece of machinery, we are hoping to be online by the middle of November. So a lot of good things going on at SilverTowne Mint, and we're very pleased with what they've been able to do there.

Great. And yes, congrats with the significant ramp in a short period of time. It's great to hear. And my last question before I hop back in the queue. On the Secured Lending business, I believe I heard you said midyear 2020 should be back to about $100 million loan book. Can you just kind of give the puts and takes there for what it's going to take you guys to get back there after the sharp decline in 3Q with the drop in silver prices? And kind of just the cadence of what you guys see there?

I think the comment was that we felt we could be back at $100 million by the middle of fiscal year 2021. So I think that on the current trajectory that we're going, assuming things keep up. And again, it's very important to note that the silver price is a direct indicator of how fast we grow the book. If silver was to drop back below to $20, the growth, it will be slowed and we'll lose some loans. But if silver continues to move up, the pace could pick up a little bit.

But I believe that it's a fair estimate that by, I would say, January, calendar year 2021, we believe we can get back to the $100 million level, which is very important for us because we do have, as we've talked about before, we have this ABS facility. And when we lose loans, we're less profitable at CFC just because the ABS has to be filled, and it can be filled with cash or inventory or loans, we make the most money when it's filled with loans. So currently, we're just dealing with some headwinds there because as we build back up to that $100 million number, which is important to note because that's the total ABS facility, we're starting to gain some -- a little bit -- we're losing some of those headwinds as we get closer to the $100 million.

The other important factor is we've worked very hard, Thor has worked very hard in the last 60 days to increase our credit line, which we announced, which Kathleen announced, and we've added another $35 million, I believe it is, to our facility. Important to note that we are trying to prepare for all different scenarios and that $35 million from our lending group will allow us, if we do get the ABS filled and if we do see a big uptick in loans. And assuming that, that would happen, we have the liquidity and we have the ability to use that extra money in our credit facility to fund the loans. So I think we're super well positioned right now to take advantage if prices stay here and if they -- the trajectory we're seeing right now on the loan book continues. I think we're in a great position to fund those loans.

(Operator Instructions) Our next question comes from the line of Chris Sakai with Singular Research.

I just had a question on Goldline. How is the demand there? And how is it -- have you seen demand flow recently? Or is it still staying strong?

Obviously, the numbers speak for themselves. We had a very strong turnaround in Goldline. I would say that it lagged a little bit to the other customers of ours or other numbers we see are participants in the market, I think Goldline started to really see some big improvement in their numbers in April. And I would say that currently, Goldline is continuing to show very strong performance as well as what we've found most encouraging is a very large percentage of their sales today are to new customers, something we really haven't seen in the last couple of years, the percentage of new customers is higher than we've seen.

I think that the Goldline customer base is certainly in tune with the current stimulus and the incredible printing of money and the likelihood of some issues down the road as it relates to that as well as the Goldline customer base seems to be very focused on the election. And I think that what's going on in the pre-election months is certainly creating some anxiety with the Goldline customer base. But I -- we're all very pleased here. It was some hard work. We had a number of these calls over the last 1.5 years that weren't particularly positive as it relates to Goldline.

But again, the work that the people there have done and the work we've done here at A-Mark in helping them to have product when nobody else had product and to have product that's a very good deal for their customers, has really -- has worked out, and we're super optimistic about Goldline going forward. We feel that our timing and sizing that business and getting our costs in line, even though it took a little longer than we had hoped. Our timing coming out of December into the new year was perfect, and they were tight, and they were in great shape to take advantage of the increased volatility in volumes in April. So very happy with Goldline right now.

Okay. Great. And then I just wanted to get your sort of opinion on, I mean, recently, since August, the price of gold and silver has sort of been at a top, and it's sort of just been hovering around the same area. I wanted to get your opinion to see, is this good or bad for your business?

Well I think that you hit the nail on the head. I mean, we have seen some slowing of the activity in the last, I would say, 3 weeks. And that is probably directly correlated to gold and silver starting to get into a bit range bound. And you're seeing a little bit less volatility, although we'll occasionally see very active days, in particular, Tuesday and Wednesday of this week when you saw some significant reaction in the stock market. I think that had some effect on gold and silver. And the number -- the price started to move a little bit outside of the range, and we saw some more intraday volatility.

But I think that, right now, it seems that gold is very much being driven by the dollar and what's going on in the U.S. dollar versus the other currencies. And I think that you're going to continue to see gold and silver perform better on weak U.S. dollar days, and they're going to perform probably a little worse when the dollar is stronger. So we feel that there's a good runway ahead of us. And even if we stay range bound, we're still going to be fine, and we're going to do okay. And -- but if you see a break above $30 on silver and a break above $2,100 on gold, I think it's going to be really good for us.

Our next question comes from the line of Richard Greulich with REG Capital Market -- Capital Advisors.

This regards the thinking on the part of the Board regarding the dividend that was announced. It's terrific that the company has been able to make the earnings and the cash flow over the last couple of quarters that enables that special dividend. But I'm wondering if any consideration had been given to using those monies to repurchase shares instead of doing a cash dividend.

Yes. I mean we go through a number of asset allocation discussions at the Board level. And I think that over the last 9 months, 12 months, we've had discussions about dividends. We've had discussions about buybacks. We've had discussions about where we can invest capital and where we need capital. And I think that it's always a discussion that we spend quite a bit of time on. And I think that at the moment, we looked at where we were liquidity-wise. We looked at areas that we thought could put a strain on liquidity. And we felt that at the moment and at this moment in time, we felt that the dividend was appropriate.

I mean we have messaged historically that when we have a good quarter or when we have a good year, we will be inclined to dividend back money to shareholders where we see fit. But I think that we were very judicious in looking at the over $4, $4.30 a share that we made. We took a very -- what I felt was analytical approach and kind of looked at where we thought we would need liquidity going forward. And in the end, we -- the Board decided upon about 1/3 of what we made that we dividend it out. So that was -- we spent quite a bit of time on it.

But as you probably know, our shares are very closely held. We have -- 50% of the stock is held with 5 or 6 people. We have not a huge trading volume. And for the company to just go in and say, "we're going to buy x amount of shares," it's not always that easy. There's timing considerations, and then the stock actually has to be available. So I think unlike large companies that have hundreds of millions of shares trading, consideration to buybacks and dividends and asset allocation, we're just very careful on that.

If I can just interject a $0.02 worth. So I have a very small registered investment advisory firm, and I own the stock for clients. And the reason I purchased the stock was because I believe that over the next 2 years, we're going to have a terrific market in gold and silver, just as you mentioned, particularly once the breakout occurs, and your company is really in almost a unique position as an investment vehicle for investors. And I think repurchasing the shares, yes, the -- it doesn't trade a lot right now, but that's fine because once things really get going, it will trade a lot. And I think it will really leverage the effect on the future share price as opposed to the cash dividend really doesn't really do much for the current price. It's nice to have, nice that you were able to earn the money. But the real big money is going to be made over the next couple of years in the stock, I think, if you can leverage that share outstanding leverage, but my opinion, but thank you very much for your hard work.

Thank you. Thank you for your support, and thanks for your recommendation of our stock to your clients.

(Operator Instructions) Our next question comes from the line of Rich Fearon with Accretive Capital Partners.

Greg, your results are truly extraordinary. And I just want to say as shareholders of yours for more than a decade and at A-Mark specifically since the spinoff from Spectrum back in November of '13, these results today are just evidence of the viability of everything you've envisioned for a number of years, and it's impressive.

I wanted -- I really just have 1 question. And do you see any constraints operationally with respect to continuing these extraordinary results? And so the volatility of gold and silver, driving strong results being kind of the underlying assumption. And assuming that you have continued strong volatility, which we do think will continue for some time, are there other operational constraints you can address to maximize this strong volatility? Or are you bumping into anything that's kind of holding you back?

I mean the last 6 months has been an incredible challenge as it relates to what everybody here at A-Mark has had to do. I mean it has been really -- there were days where every single day, there was a challenge. I think that what we have realized from this increased demand and increased volume is that keeping our logistics facility and keeping the SilverTowne Mint functioning and keeping them open is a very high priority and probably something that we didn't really recognized prior to this COVID because the COVID really shut down almost all logistics and movement. When airplanes stop flying and mints stop producing, and people aren't going to work and Brink's drivers aren't driving, it is a real challenge when you're trying to move 600,000 ounces of silver around the world.

And that -- if you just think about the numbers and the ounces that we traded, that metal all has to move. And it doesn't -- it moves anywhere from London to Las Vegas. It moves from Las Vegas to Singapore. It moves from New York to Winchester, Indiana, where the SilverTowne Mint is. And it has to move from the refiners and the mines to places where we can sell it. So I think that -- we don't know what's coming next, but I will say that Brian Aquilino and his team in operations that really made us -- give us the ability to trade the product is something that we are aware of and we are committed and supporting to that logistics as well as the product supply chain.

So I think we're ready for it. I mean we're one of the few companies out there the last 6 months that have been able to have product available and to get product to our customers in a timely fashion so that they could deliver it to their customers. So I feel like we're well positioned, and I don't really feel like we missed a beat. I mean I don't think there was a day -- I don't think there was a day in the last 6 months where we were unable to ship packages out from our Las Vegas facility, and we were constrained on a few days just by Brink's, in particular. Brink's was dealing with a number of other issues as it related to the COMEX and as it related to some of the ETFs, and we had to take some fairly creative moves to get our product moving. But we did it and it's hard to predict what's going to happen in the future, but I feel like we can -- we're ready to do. We're ready to go, whatever pitch is thrown our way.

Yes. And you've proved yourself capable of doing it probably the most extraordinary times you could have imagined. I always have thought about the business as your core business being an ability really to capitalize on widening spreads and the trading opportunities when periods of volatility create that widening of spreads. And what you've done in a very intelligent way is overlaid really 3 high-margin businesses with finance, storage and transportation. And it sounds like of those 3, it was really just the transportation that was constrained. But as we return to normalcy, even that is back in full swing. Is that fair to say?

Yes. I mean we took some extraordinary measures, and we were prepared for almost anything. I think logistics is very important to us. Logistics, being able to have the liquidity and have the ability to borrow against our inventory, to move our inventory to places that it is eligible for our credit facility. Thor did an incredible job. Kathleen helped Thor. The two of them were up late, many nights, just making sure the metal ended up in a place where we needed it.

So I think that we were prepared, though. I mean we've -- one thing we've never done before is because it was never profitable, but it worked for A-Mark as we moved silver from Europe to New York on an airplane. That was a first in my history, never happened. We talked about moving silver on a boat. We investigated owning our own 18-wheeler. So we were very well prepared for whatever was thrown on our way. And I think what we've learned and what we were able to put in place the last 6 months, really sets us up to do more volume going forward. I think we could -- there is no doubt we can sell -- buy and sell more gold and silver ounces if the market lets us do it. So I think we're there.

Well the business you've created, Greg, is really strong at this point, and we're very appreciative of low your hard work and congratulations on great results and happy to be shareholders.

Well Rick, you've been listening to this for 10 years now. And like we've always said, we're going to go through periods of quiet time, but we build the business so that when the market gives us an opportunity to take advantage of it, we're going to hit a home run. And that's kind of what you've been -- questions you've been asking and your support for the last 10 years, I can't thank you enough. So I'm very pleased to be able to deliver on our promise to you.

At this time, this concludes our question-and-answer session. I'd now like to turn the call back over to Mr. Roberts for his closing remarks.

Thanks, everyone, for joining us on our call today. And thank you for your continued support and confidence in our mission. Everybody, have a great rest of the afternoon or evening. Thank you very much.

Before we conclude today's call, I would like to provide A-Mark's safe harbor statement that includes important cautions regarding forward-looking statements made during this call.

During today's call, there are forward-looking statements made regarding future events. Statements that relate to A-Mark's future plans, objectives, expectations, performance, events and the like of are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. Future events, risks and uncertainties, individually or in aggregate, could cause actual results to differ materially from those expected or implied in these statements.

Factors that could cause actual results to differ include the following: the failure to execute the company's growth strategy as planned; greater-than-anticipated costs incurred to execute the strategy; changes in the current domestic and international political climate; increased competition for A-Mark's higher-margin services, which could depress pricing; the failure of the company's business model to respond to changes in the market environment as anticipated; general risk of doing business in the commodity markets and other businesses, economic, financial and governmental risks as described in the company's public filings with the Securities and Exchange Commission.

The words should, believe, estimate, expect, intend, anticipate, foresee, plan and similar expressions and variations thereof identify certain of these forward-looking statements, which speak only as of the date on which they were made. Additionally, any statements related to future improved performance and estimates of revenue and earnings per share are forward-looking statements. The company undertakes no obligation to publicly update or revise any forward-looking statements. Readers are cautioned not to place any undue reliance on these forward-looking statements.

Finally, I would like to remind everyone that a recording of today's call will be available for replay via a link in the Investors section of the company's website. Thank you for joining us today for A-Mark's earnings call. You may now disconnect.