Market Overview

FRMO Corp. Announces Results for Fiscal 2019

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FRMO Corp. (the "Company" or "FRMO") (OTC:FRMO) today reported its financial results for the fiscal year 2019, which ended May 31, 2019.

Financial Highlights

FRMO's book value as of May 31, 2019 was $174.9 million ($3.98 per share on a fully diluted basis), including $48.6 million of non-controlling interests. The figure from the prior fiscal year-end as of May 31, 2018 was $146.9 million ($3.34 per share), including $27.6 million of non-controlling interests. Current assets, comprised primarily of cash and equivalents and equity securities, amounted to $118.3 million as of May 31, 2019, and $93.2 million as of May 31, 2018. Total liabilities were $16.7 million as of May 31, 2019, compared to $13.5 million as of May 31, 2018, primarily securities sold, not yet purchased and deferred taxes.

FRMO's net income attributable to the Company for the fiscal year ended May 31, 2019 was $4,709,662 ($0.11 per share basic and diluted) compared to $14,052,518 ($0.32 per share) for the fiscal year ended May 31, 2018.

For the fiscal year 2019, comprehensive income attributable to the Company was $4,709,662 compared to $14,835,607 in the prior year.

FRMO's net income (loss) attributable to the Company excluding the effect of unrealized gain (loss) from equity securities net of taxes for the three months ended May 31, 2019 was $3,398,500 ($0.08 per diluted share) compared to $(4,265,263) ($(0.10) per share) for the three months ended May 31, 2018. For the year ended May 31, 2019, the amount was $9,027,157 ($0.21 per share) compared to $14,052,518 ($0.32 per share) for the same period in the prior year. Net income (loss) attributable to the Company excluding the effect of unrealized gains (losses) from equity securities net of taxes is a measure not based on GAAP and is defined and reconciled to the most directly comparable GAAP measures in "Information Regarding Non-GAAP Measures" at the end of this release.

As of May 31, 2019 and May 31, 2018, the Company held a 15.49% and 12.92% equity interest in Horizon Kinetics Hard Assets LLC ("HKHA"), a company formed by Horizon Kinetics LLC and certain officers, principal stockholders and directors of FRMO Corp.("the Company"). Due to the common control and ownership between HKHA and the Company's principal stockholders and directors, HKHA has been consolidated within the Company's financial statements. The noncontrolling interest of 84.51% and 87.08% in HKHA has been eliminated from results of operations for the periods ended May 31, 2019 and May 31, 2018.

Further details are available in the Company's Consolidated Financial Statements for the fiscal year ended May 31, 2019. These statements have been filed on the OTC Markets Group Disclosure and News Services, which may be accessed at www.otcmarkets.com/stock/FRMO/filings. These documents are also available on the FRMO website at www.frmocorp.com.

Annual Meeting Information

The Chairman, President, and Board of Directors of FRMO Corp. cordially invite shareholders to attend the Company's Annual Meeting of Shareholders at which the Chairman and President will review the Fiscal 2019 financial results and the outlook for the future. Board members will be available to answer questions.

Date:

Tuesday, September 10, 2019 at 3PM.

Location:

The Harvard Club of New York City

35 West 44th Street

New York, NY 10036

Admission to the FRMO Annual Meeting is limited to stockholders who owned Common Stock as of the close of business on July 26, 2019, the record date, or their duly appointed proxies, and one guest. Proof of ownership of FRMO stock and valid government-issued photo identification must be presented in order to be admitted to the Annual Meeting. Each guest must also present valid government-issued photo identification. If your shares are held in the name of a bank, broker, or other holder of record, you must bring a brokerage statement or other proof of ownership (or the equivalent proof of ownership as of the close of business on the record date of the stockholder who granted you the Proxy). If your shares are held in certificate form, ownership will be verified by consulting the list of Registered Shareholders as of the record date. Registration will begin at 2:00 p.m. No cameras, recording equipment, electronic devices, large bags, briefcases, or packages will be permitted in the Annual Meeting. Dress code for the Harvard Club is business casual (no jeans, sneakers, or athletic wear permitted).

 
Condensed Consolidated Balance Sheets
(in thousands)
May 31, May 31,

2019

 

2018

 
Assets
Current Assets:
Cash and cash equivalents

$ 53,081

$ 53,617

Equity securities, at fair value

63,565

38,522

Other current assets

1,639

1,095

Total Current Assets

118,285

93,234

Computer equipment, net of accumulated depreciation

95

76

Investment in limited partnerships and other
equity investments, at fair value

47,513

41,407

Investments in securities exchanges

3,641

3,709

Other investments

452

189

Investment in Horizon Kinetics LLC

11,488

11,624

Participation in Horizon Kinetics LLC revenue stream

10,200

10,200

Total Assets

$ 191,674

$ 160,439

 
Liabilities and Stockholders' Equity
Current Liabilities:
Securities sold, not yet purchased

$ 8,133

$ 5,495

Other current liabilities

161

193

Total Current Liabilities

8,294

5,688

Deferred Tax Liability

8,383

7,757

Total Liabilities

16,677

13,445

 
Stockholders' Equity:
Stockholders' Equity Attributable to the Company

126,384

119,411

Noncontrolling interests

48,613

27,583

Total Stockholders' Equity

174,997

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