Contact:
Terry Badger
Director of Communications
210.308.1221
tbadger@usfunds.com
For Immediate Release
U.S. Global Investors opens FY07 with
strong quarter Asset management company
reports revenue up 81%, earnings rise 126%
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SAN ANTONIO--Nov. 9, 2006--U.S. Global Investors, Inc. (NASDAQ: GROW), a
boutique registered investment advisory firm specializing in natural resources
and emerging markets, reported today that earnings in the quarter ended
September 30, 2006, more than doubled from the same period in 2005.
The company recorded net income of $2.48 million, or 32 cents per diluted share,
on revenue of $11.91 million during the first three months of fiscal year 2007.
That compares to earnings of $1.10 million, or 14 cents per diluted share, on
revenue of $6.57 million during the same quarter a year earlier.
The company has scheduled a webcast for 10 a.m. Central time today to discuss
the company's key financial results for the quarter. Frank Holmes, CEO and chief
investment officer, will be accompanied on the webcast by Susan McGee, president
and general counsel, and Catherine Rademacher, chief financial officer.
The growth in revenue and earnings in the first fiscal quarter of 2007 compared
to the corresponding quarter in FY2006 is mostly due to increases in advisory
fee revenue associated with the near doubling in assets under management. Most
of those new assets were attracted to U.S. Global's natural resources and
emerging market funds.
"On a year-over-year basis, we are very happy that our assets under management
have grown as much as they have, even though natural resource and emerging
markets were very volatile in the quarter and assets declined temporarily for
the resource and emerging markets funds," said Frank Holmes, U.S. Global's CEO
and chief investment officer. "We remain bullish on the long-term growth
prospects for emerging markets and the need for natural resources to build, fuel
and feed the world's 6.5 billion people."
U.S. Global's fund assets under management averaged more than $4.79 billion for
the first fiscal quarter, compared to the average of $2.4 billion for the three
months ended September 30, 2005. The average assets under management for the
latest quarter include $198.7 million in offshore funds.
Selected financial data (unaudited) for the three months ended Sept. 30
2006 2005
Revenue $11,907,513 $6,574,522
Expenses $8,195,200 $4,859,052
Tax expense $1,232,608 $619,535
Net Income $2,479,705 $1,095,935
EPS (basic) $0.33 $0.15
EPS (diluted) $0.32 $0.14
Avg. common shares outstanding (basic) 7,573,776 7,492,493
Avg. common shares outstanding (diluted) 7,637,712 7,587,049
Avg. SEC-registered fund assets under mgmt $4.6 billion $2.4 billion
As of September 30, 2006, the U.S. Global Investors fund family had several
funds leading their peer groups and the overall mutual-fund sector in time
periods going back as far as five years, according to the rating company Lipper
Inc.
For the 12 months ended September 30, 2006, U.S. Global's Gold Shares Fund
(USERX) was ranked #1 by Lipper in total return among all domestic funds and the
company's World Precious Minerals Fund (UNWPX) was ranked #3.
For the five years ended September 30, 2006, the World Precious Minerals Fund
ranked #2 in total return among all domestic funds. U.S. Global's Eastern
European Fund (EUROX) was #3, the Global Resources Fund (PSPFX) was #5 and the
Gold Shares Fund was #7. No other fund family had as many funds in Lipper's top
50 for the period.
About U.S. Global Investors, Inc.
U.S. Global Investors, Inc. (www.us-global.com) is a registered investment
adviser that focuses on profitable niche markets around the world. Headquartered
in San Antonio, Texas, the company offers financial solutions and provides
transfer agency and other services to U.S. Global Investors Funds and U.S.
Global Accolade Funds.
With an average of more than $4.79 billion in assets under management for the
quarter ended September 30, 2006, U.S. Global Investors manages domestic and
offshore funds offering a variety of investment options, from emerging markets
to money markets. In general, trends in assets under management are the critical
drivers of revenue and earnings.
Please consider carefully the fund's investment objectives, risks, charges and
expenses. For this and other important information, obtain a fund prospectus by
visiting www.usfunds.com or by calling 1-800-US-FUNDS (1-800-873-8637). Read it
carefully before investing. Distributed by U.S. Global Brokerage Inc.
Performance data quoted above is historical. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
data quoted. The principal
value and investment return of an investment will fluctuate so that your shares,
when redeemed, may be worth more or less than their original cost. Performance
does not include the effect of any fees described in the fund's prospectus (e.g.
short-term trading fees) which, if applicable, would lower your total returns.
Obtain performance data current to the most recent month-end at www.usfunds.com
or 1-800-US-FUNDS, option 5.
All opinions expressed and data provided are subject to change without notice.
Some of these opinions may not be appropriate to every investor.
Foreign and emerging-market investing involves special risks, such as currency
fluctuation and less public disclosure, as well as economic and political risk.
Gold funds may be susceptible to adverse economic, political or regulatory
developments due to concentrating in a single theme. The price of gold is
subject to substantial price fluctuations over short periods of time and may be
affected by unpredicted international monetary and political policies. We
suggest investing no more than 3% to 5% of your portfolio in gold or gold
stocks.
Lipper ratings for Total Return reflect funds' historical total return
performance relative to peers as of Sept. 30, 2006. Although Lipper makes
reasonable efforts to ensure the accuracy and reliability of the data contained
herein, the accuracy is not guaranteed by Lipper. Users acknowledge that they
have not relied upon any warranty, condition, guarantee, or representation made
by Lipper. Any use of the data for analyzing, managing, or trading financial
instruments is at the user's own risk. This is not an offer to buy or sell
securities.
As of Sept. 30, 2006, according to Lipper, the Gold Shares Fund ranked #1 of 53,
#3 of 48, #2 of 38 and #23 of 24 among gold-oriented funds for total return for
the 1-, 3-, 5- and 10-year periods. The World Precious Minerals Fund ranked #3
of 53, #1 of 48, #1 of 38, and #17 of 24 among gold-oriented funds for total
return for the 1-, 3-, 5-, and 10-year periods. The Eastern European Fund ranked
#201 of 209, #2 of 177 and #2 of 143 among emerging-market funds for the 1-, 3-
and 5-year periods. The Global Resources Fund ranked #27 of 103, #3 of 76, #1 of
69 and #13 of 31 among natural resources funds for the 1-, 3-, 5- and 10-year
periods.
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