Marygold Companies Inc

Previous wording

The following discussion and analysis should be read in conjunction with the unaudited financial statements and the accompanying notes thereto and is qualified in its entirety by the foregoing and by more detailed financial information appearing elsewhere in this quarterly report on Form 10-Q. See “Item 1 - Financial Statements.”

Current wording

The following discussion and analysis should be read in conjunction with the unaudited financial statements and the accompanying notes thereto and is qualified in its entirety by the foregoing and by more detailed financial information appearing elsewhere in this Report. See “Item 1 - Financial Statements (Unaudited).”

Previous wording

Consolidated revenue for the three months ended December 31, 2023 was $8.5 million representing a $0.3 million, or 4%, decrease from the three months ended December 31, 2022 revenue of $8.8 million. The decrease in consolidated revenue was primarily attributed to USCF Investments where Assets Under Management (“AUM”) for the three months ended December 31, 2023 was lower than 2022 which resulted in a revenue decrease of $0.3 million.

Current wording

Consolidated revenue for the three months ended March 31, 2024 was $7.9 million representing a $0.4 million, or 5%, decrease from the three months ended March 31, 2023 revenue of $8.3 million. The decrease in consolidated revenue was primarily attributed to USCF Investments where assets under management (“AUM”) for the three months ended March 31, 2024 was lower than the comparable prior year period which resulted in a revenue decrease of $0.6 million, offset by an increase in revenue of $0.1 million from each of our beauty products and security systems business segments.

Previous wording

The Company’s operating loss for the three months ended December 31, 2023 was ($1.0) million as compared to operating income of $0.1 million for the three months ended December 31, 2022. This represents a decrease in operating income of $1.1 million for the three months ended December 31, 2023 compared to the prior year. Apart from the $0.3 million decline in revenues, the remaining $0.8 million difference in operating income (loss) is primarily attributed to an increase in marketing and development expenses incurred at Marygold & Co. and Original Sprout.

Current wording

The Company’s operating loss for the three months ended March 31, 2024 was ($1.5) million as compared to operating income of $0.2 million for the three months ended March 31, 2023. This represents a decrease in operating income of approximately $1.6 million for the three months ended March 31, 2024 compared to the prior year. The decrease in operating income was attributable to the reduced revenue from the fund management business and an increase in operating expenses related to the roll out of our fintech business at Marygold & Co.

Previous wording

For the three months ended December 31, 2023 we had an other (expense) income, net of ($0.4 million) compared to an other income, net of $0.2 million for the three months ended December 31, 2022 which was primarily attributable to unrealized losses on investments.

Current wording

For the three months ended March 31, 2024 the Company had other income, net of $0.6 million compared to an other expense, net of less than ($0.1) million for the three months ended March 31, 2023. The $0.6 million increase compared to the prior year period was primarily attributable to unrealized gains on investments.

Previous wording

For the three months ended December 31, 2023 we had an income tax benefit of $0.2 million compared to an income tax provision of ($0.1) million for the comparable prior year period which was a function of reporting pre-tax income in the prior year period to reporting pre-tax losses in the current year period.

Current wording

For the three months ended March 31, 2024 we had an income tax benefit of $0.4 million compared to less than $0.1 million for the comparable period of the prior year which was a function of reporting a pre-tax loss in the current year period.

Previous wording

For the three months ended December 31, 2023, the Company generated a net loss of ($1.2 million) as compared to net income of $0.2 million for the three months ended December 31, 2022. The $1.4 million decrease in net income was primarily attributable to $0.9 million in lower profits at our fund management business and increased losses of $0.8 million in our financial services business as the Company continues to invest capital into our fintech subsidiary; partially offset by reductions in our corporate expenses of $0.3 million and improvement in profits of $0.2 million at our food products business.

Current wording

For the three months ended March 31, 2024, the Company generated a net loss of ($0.5 million) as compared to net income of $0.2 million for the three months ended March 31, 2023. The $0.7 million decrease in net income was attributable to $0.5 million in lower profits at our fund management business and increased losses of $0.4 million in our financial services business as the Company continues to invest capital into our fintech subsidiary, partially offset by reduced corporate costs of $0.2 million.

Previous wording

Consolidated revenue for the six months ended December 31, 2023 was $16.7 million representing a $1.0 million or 6% decrease from the six months ended December 31, 2022 revenue of $17.7 million. The decrease in consolidated revenue was primarily attributed to lower revenues by $0.6 million from lower AUM at USCF Investments, lower revenue by $0.2 million from our food products segment as we were transitioning to a more favorable product mix and refocused production capacity to higher profit margin customers, and lower revenue by $0.2 million at security systems due to the timing of certain commercial contracts.

Current wording

Consolidated revenue for the nine months ended March 31, 2024 was $24.6 million representing a $1.4 million or 6% decrease from the nine months ended March 31, 2023 revenue of $26.0 million. The decrease in consolidated revenue was attributed to lower revenues by $1.3 million from lower AUM at USCF Investments and lower revenue by $0.2 million from our food products segment as we were transitioning to a more favorable product mix and refocused production capacity to higher profit margin customers.

Previous wording

The Company’s operating loss for the six months ended December 31, 2023 was ($2.0) million as compared to operating income of $0.9 million for the six months ended December 31, 2022. This represents a decrease in operating income of $2.9 million which was primarily attributed to a $1.7 million increase in losses from financial services as we ramped up the development of our Fintech app and reduced profits by $0.8 million from lower AUM at USCF Investments.

Current wording

The Company’s operating loss for the nine months ended March 31, 2024 was ($3.1) million as compared to operating income of $1.1 million for the nine months ended March 31, 2023. This represents a decrease in operating income of $4.2 million which was attributed to reduced revenue of $1.3 million at USCF Investments from lower AUM and increased losses from our financial services business unit as we ramped up the development of our fintech app.

Previous wording

For the six months ended December 31, 2023 we had an income tax benefit of $0.5 million compared to an income tax provision of ($0.3) million for the comparable period of the prior year which was a function of reporting pre-tax income in the prior year period to reporting pre-tax losses in the current year period.

Current wording

For the nine months ended March 31, 2024 we had an income tax benefit of $0.9 million compared to an income tax provision of ($0.3) million for the comparable period of the prior year which was a function of reporting pre-tax income in the prior year period to reporting a pre-tax loss in the current year period.

Previous wording

For the six months ended December 31, 2023, the Company generated a net loss of ($1.7 million) as compared to net income of $0.7 million for the six months ended December 31, 2022. The $2.4 million decrease in net income was primarily attributable to lower profits at our fund management business and increased losses in our financial services business as the Company continues to invest capital into our fintech subsidiary.

Current wording

For the nine months ended March 31, 2024, the Company generated a net loss of ($2.2 million) as compared to net income of $0.8 million for the nine months ended March 31, 2023. The $3.0 million decrease in net income was attributable to lower profits of $1.3 million at our fund management business, increased losses of $2.1 million in our financial services business as the Company continues to invest capital into our fintech app, and increased losses of $0.4 million at our beauty products business as further described below, partially offset by reduced corporate costs of $0.7 million.

Previous wording

Fund Management – USCF Investments (59% and 60% of consolidated revenues for the three and six months ended December 31, 2023, respectively)

Current wording

Fund Management – USCF Investments (56% and 59% of consolidated revenues for the three and nine months ended March 31, 2024, respectively)

Previous wording

USCF currently serves as the General Partner or the Sponsor to the following commodity pools, each of which is currently conducting a public offering of its shares pursuant to the Securities Act of 1933, as amended:

Current wording

USCF currently serves as the General Partner or the Sponsor to the following commodity pools, each of which is currently conducting a public offering of its limited partnership shares pursuant to the Securities Act of 1933, as amended:

Previous wording

USCF Investments’ revenue and expenses are primarily driven by the amount of AUM of the Funds. USCF Investments earns monthly management and advisory fees based on agreements with each Fund as determined by the contractual basis point management fee structure in each agreement multiplied by the average AUM over the given period. Many of the company’s expenses are dependent upon the amount of AUM. These variable expenses include Fund administration, custody, accounting, transfer agency, marketing and distribution, and sub-adviser fees and are primarily determined by multiplying contractual fee rates by AUM.

Current wording

USCF Investments’ revenue and expenses are driven by the amount of AUM of the Funds. USCF Investments earns monthly management and advisory fees based on agreements with each Fund as determined by the contractual basis point management fee structure in each agreement multiplied by the average AUM over the given period. Many of the Fund’s expenses are dependent upon the amount of AUM. These variable expenses include Fund administration, custody, accounting, transfer agency, marketing and distribution, and sub-adviser fees and are determined by multiplying contractual fee rates by AUM.

Previous wording

Average AUM for the three months ended December 31, 2023 was $3.5 billion as compared to $3.8 billion from the three months ended December 31, 2022 primarily due to a decrease in USO, USCI and BNO AUM, partially offset by an increase in UNG AUM. As a result, the revenues from management and advisory fees decreased by $0.3 million, or 5%, to $5.0 million for the three months ended December 31, 2023 as compared to the three months ended December 31, 2022 where revenues from management and advisory fees totaled $5.3 million.

Current wording

Average AUM for the three months ended March 31, 2024 was $3.0 billion as compared to $3.7 billion from the three months ended March 31, 2023, a decrease of $0.7 billion or 19%, due to a decrease in USO, UNG and BNO AUM, partially offset by an increase in UMI AUM. As a result, the revenues from management and advisory fees decreased by $0.6 million, or 12%, to $4.4 million for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 where revenues from management and advisory fees totaled $5.0 million.

Previous wording

USCF Investments total operating expenses for three months ended December 31, 2023 remained consistent at $3.7 million compared to the prior year quarter. Total variable expenses, as described above, were comparable quarter over quarter, with offsetting changes including a decrease in sub-advisory fees of $0.1 million due to a decrease in USCI and CPER AUM offset by an increase of $0.1 million in fund accounting and administration expenses due to an increase in the number of funds under management. Operations expenses increased by $0.1 million compared to the prior year quarter due to an increase in license and professional fees for new funds.

Current wording

USCF Investments total operating expenses for three months ended March 31, 2024 increased $0.5 million to $3.6 million, or 16%, from $3.1 million for the three months ended March 31, 2023. Total variable expenses, as described above, were comparable quarter over quarter, with offsetting changes including a decrease in sub-advisory fees of $0.1 million due to a decrease in USCI and CPER AUM offset by an increase of $0.1 million in fund accounting and administration expenses due to an increase in the number of funds under management. General and administrative (“G&A”) expenses increased $0.1 million to $0.6 million, or 18%, from $0.5 million due to an increase in professional fees. Operations expenses increased by $0.2 million to $1.3 million from $1.1 million compared to the prior year quarter and employee compensation expenses increased $0.2 million due to quarterly bonus accruals in anticipation of year-end bonuses.

Previous wording

Operating income decreased by $0.3 million to $1.3 million for the three months ended December 31, 2023 from $1.6 million for the three months ended December 31, 2022. The decrease was primarily due to lower revenue. Other income (expense) was ($0.4) million for the three months ended December 31, 2023 compared to $0.2 million for the three months ended December 31, 2022 resulting in a $0.6 million decrease due to unrealized losses ($0.5) million on equity investments in the current year quarter partially offset by $0.1 million in dividend and interest income. Pre-tax income for the three months ended December 31, 2023 decreased $0.9 million to $0.9 million compared to a $1.8 million for three months ended December 31, 2022 due to a $0.3 million decrease in revenue as a result of lower AUM and $0.6 million decrease in other income.

Current wording

Operating income decreased by $1.1 million to $0.8 million for the three months ended March 31, 2024 from $1.9 million for the three months ended March 31, 2023. The decrease was due to lower revenue as a result of lower AUM along with the increase in expenses as described above. Other income (expense) was $0.6 million for the three months ended March 31, 2024 compared to ($0.1) million for the three months ended March 31, 2023 resulting in a $0.6 million increase due to unrealized gains of $0.3 million on equity investments in the current period in addition to $0.2 million in dividend and interest income.

Previous wording

Average AUM for the six months ended December 31, 2023 was $3.5 billion as compared to $3.8 billion from the six months ended December 31, 2022 primarily due to a decrease in USO and USCI AUM, partially offset by an increase in UNG AUM. As a result, the revenues from management and advisory fees decreased by $0.6 million, or 6%, to $10.1 million for the six months ended December 31, 2023 as compared to the six months ended December 31, 2022 where revenues from management and advisory fees totaled $10.7 million.

Current wording

Average AUM for the nine months ended March 31, 2024 was $3.3 billion as compared to $3.8 billion from the nine months ended March 31, 2023 due to a decrease in USO and USCI AUM, partially offset by an increase in UNG AUM. As a result, the revenues from management and advisory fees decreased by $1.3 million, or 8%, to $14.5 million for the nine months ended March 31, 2024 as compared to the nine months ended March 31, 2023 where revenues from management and advisory fees totaled $15.7 million.

Previous wording

USCF Investments total operating expenses for the six months ended December 31, 2023 decreased by $0.2 million to $7.0 million, or 3%, from $7.2 million for the six months ended December 31, 2022. Total variable expenses, as described above, decreased by $0.3 million due to a decrease in total AUM which included a $0.3 million decrease in variable marketing and distribution expenses, a decrease of $0.1 million in sub-advisory fees related to lower USCI and CPER AUM partially offset by a $0.1 million increase in fund accounting and administration expenses due to an increase in the number of funds under management. Employee compensation expenses were $2.5 million for the six months ended December 31, 2023 compared to $2.7 million for six months ended December 31, 2022 primarily due to lower bonus expenses. Operations expenses increased by $0.2 million due to an increase in license and professional fees for new funds.

Current wording

USCF Investments total operating expenses for the nine months ended March 31, 2024 increased by $0.4 million to $10.7 million, or 3%, from $10.3 million for the nine months ended March 31, 2023. Total variable expenses, as described above, decreased by $0.3 million due to a decrease in total AUM which included a $0.3 million decrease in variable marketing and distribution expenses, a decrease of $0.1 million in sub-advisory fees related to lower USCI and CPER AUM partially offset by a $0.1 million increase in fund accounting and administration expenses due to an increase in the number of funds under management. G&A expenses remained flat at $1.8 million for each nine-month period. Employee compensation expenses remained consistent at $3.7 million for the nine months ended March 31, 2024 compared to the nine months ended March 31, 2023. Operations expenses increased by $0.4 million due to an increase in license and director fees for new funds.

Previous wording

Food Products (23% and 22% of consolidated revenue for the three and six months ended December 31, 2023, respectively)

Current wording

Food Products (23% and 22% of consolidated revenue for the three and nine months ended March 31, 2024, respectively)

Previous wording

Food products (Gourmet Foods and Printstock) revenues for the three months ended December 31, 2023 and 2022 was flat at $1.9 million; however gross margin improved by 5% and net income of $0.2 million improved by $0.2 million from the comparative prior year quarter. The improved profitability was primarily a result of a more favorable product mix and refocusing production capacity to higher profit margin customers.

Current wording

Food products (Gourmet Foods and Printstock) revenues for the three months ended March 31, 2024 and 2023 was flat at $1.8 million; however net income improved by less than $0.1 million from the comparative prior year quarter as result of a more favorable product mix and refocusing production capacity to higher profit margin customers.

Previous wording

For the six months ended December 31, 2023, food products revenues declined by $0.2 million; however net income was flat at $0.2 million primarily due to operating efficiencies achieved during the current six-month period as compared to the prior year six-month period.

Current wording

For the nine months ended March 31, 2024, food products revenues declined by $0.2 million; however net income was flat at $0.2 million due to operating efficiencies achieved during the current nine-month period as compared to the prior year comparative period.

Previous wording

Beauty Products (10% of consolidated revenues for both the three and six months ended December 31, 2023)

Current wording

Beauty Products (11% and 10% of consolidated revenues for the three and nine months ended March 31, 2024, respectively)

Previous wording

For the quarter ended December 31, 2023, beauty products (Original Sprout) revenue increased by less than $0.1 million and net loss increased by less than $0.1 million. The increase in net loss was primarily due to increased expenses associated with new product development and marketing. For the six months ended December 31, 2023, beauty products revenues increased by less than $0.1 million and net loss increased by $0.4 million. The increase in net loss was primarily due to increased expenses associated with new product development and marketing.

Current wording

For the quarter ended March 31, 2024, beauty products (Original Sprout) revenue increased by $0.1 million and net loss increased by less than $0.1 million. The increase in net loss was due to increased expenses associated with new product development and marketing. For the nine months ended March 31, 2024, beauty products revenues increased by $0.1 million and net loss increased by $0.4 million. The increase in net loss was due to increased expenses associated with new product development and marketing.

Previous wording

Security Systems (7% of consolidated revenue for both the three and six months ended December 31, 2023)

Current wording

Security Systems (8% and 7% of consolidated revenue for the three and nine months ended March 31, 2024, respectively)

Previous wording

For the quarter ended December 31, 2023, security systems (Brigadier) revenue declined by less than $0.1 million and net profit was flat compared to the prior year quarter. For the six months ended December 31, 2023, security systems revenues declined by less than $0.2 million primarily due to market timing and weather patterns and net profit declined by less than $0.1 million compared to the prior year period.

Current wording

For the quarter ended March 31, 2024, security systems (Brigadier) revenue increased by less than $0.1 million and net income was flat compared to the prior year quarter. For the nine months ended March 31, 2024, security systems revenues declined by $0.1 million due to market timing and weather patterns and net income declined by less than $0.1 million compared to the prior year period.

Previous wording

Marygold UK operates through its wholly owned subsidiary Tiger Financial & Asset Management Limited (“Tiger”), which was acquired in June 2022. Tiger acts as an investment advisor and financial planner to its clients and has two principal revenue streams which comprise ongoing fees for providing investment advice, and commissions for the intermediation of insurance-based products. Tiger does not provide investment management services directly, rather the clients’ assets are referred to third party investment managers, primarily discretionary investment managers. Tiger receives fees for the ongoing advice and financial planning services which are charged as a percentage of the assets under management, which as of June 30, 2023 was $40 million and as of December 31, 2023 was $42 million. The ratio of fees earned from investment advice as compared to commissions earned is generally 80:20, but may fluctuate for any given period.

Current wording

Marygold UK operates through its wholly owned subsidiary Tiger Financial & Asset Management Limited (“Tiger”), which was acquired in 2022. Tiger acts as an investment advisor and financial planner to its clients and has two principal revenue streams which comprise ongoing fees for providing investment advice, and commissions for the intermediation of insurance-based products. Tiger does not provide investment management services directly, rather the clients’ assets are referred to third party investment managers, discretionary investment managers. Tiger receives fees for the ongoing advice and financial planning services which are charged as a percentage of the assets under management, which as of June 30, 2023 and March 31, 2024 was $40 million. The ratio of fees earned from investment advice as compared to commissions earned is generally 80:20, but may fluctuate for any given period.

Previous wording

Revenues for the six months ended December 31, 2023 were unchanged at $0.3 million as compared to the six months ended December 31, 2022. Operating expenses for the six months ended December 31, 2023 were $0.4 million as compared to $0.2 million for the six months ended December 31, 2022 with the increase attributed to the hiring of additional staff and increased professional fees in connection with the development of the Marygold mobile fintech app in the UK.

Current wording

Revenues for the nine months ended March 31, 2024 were unchanged at $0.4 million as compared to the nine months ended March 31, 2023. Operating expenses for the nine months ended March 31, 2024 were $0.6 million as compared to $0.3 million for the nine months ended March 31, 2023 with the increase attributed to the hiring of additional staff and increased professional fees in connection with the development of the Marygold mobile fintech app in the UK.

Previous wording

Marygold & Co. is a financial technology company, not a bank, providing an all-in-one banking and payment services app offering FDIC-insured accounts with a Debit Mastercard®. Like a private banker on your phone, Marygold has introduced a secure way to send, receive, spend, save and invest with no banking fees or minimum balance requirements and aims to redefine mobile banking and payments, all in one app. Marygold completed its development phase in June 2023 and continues to devote considerable resources to the development and launch of its proprietary Fintech app. Revenue is earned from the Mastercard® interchange system with debit card spend by users and from asset management fees earned on investments through the use of Money Pools, which are goal based savings and investment accounts.

Current wording

Marygold & Co. is a financial technology company, not a bank, providing similar banking services through an all-in-one banking and payment services app offering FDIC-insured accounts with a Debit Mastercard®. Like a private banker on your phone, Marygold has introduced a secure way to send, receive, spend, save and invest with no banking fees or minimum balance requirements and aims to redefine mobile banking and payments, all in one app. Marygold completed its development phase in June 2023 and continues to devote considerable resources to the development and launch of its proprietary Fintech app. Revenue is earned from the Mastercard® interchange system with debit card spend by users and from asset management fees earned on investments through the use of Money Pools, which are goal based savings and investment accounts.

Previous wording

Onboarding of new customers continued during the three months ended December 31, 2023 resulting in nominal revenue. Operating expenses for the three months ended December 31, 2023 increased $0.7 million to $1.4 million compared to $0.7 million in the prior year quarter. The increase was attributed to ongoing development of the app and continued ramping up for the product post launch. Increases from the prior year’s quarter included additional spend of $0.4 million in product development and app service provider infrastructure, as well as $0.1 million in advertising, marketing and employee compensation expenses.

Current wording

Onboarding of new customers continued during the three months ended March 31, 2024 resulting in nominal revenue. Operating expenses for the three months ended March 31, 2024 increased by $0.4 million to $1.4 million compared to $1.0 million in the prior year quarter. The increase was attributed to ongoing development of the app and continued ramping up for the product post launch. Increases from the prior year’s quarter included additional spend of $0.2 million in product development and app service provider infrastructure, as well as $0.1 million in advertising, marketing and professional fees.

Previous wording

Operating expenses for the six months ended December 31, 2023 increased $1.5 million to $2.9 million compared to $1.4 million in the prior year period. The increase was attributed to ongoing development of the app and continued ramping up for the product post launch. Increases from the prior year’s six-month period included additional spend in product development, advertising and marketing and employee compensation expenses.

Current wording

Operating expenses for the nine months ended March 31, 2024 increased $1.9 million to $4.2 million compared to $2.3 million in the prior year period. The increase was attributed to ongoing development of the app and continued ramping up for the product post launch. Increases from the prior year’s nine-month period included additional spend in product development, advertising and marketing and professional fees.

Previous wording

The Marygold Companies is a holding company that conducts its operations through its subsidiaries. At the holding-company level, its liquidity needs relate to operational expense, the funding of additional business acquisitions and new investment opportunities. Our operating subsidiaries’ principal liquidity requirements arise from cash used in operating activities, debt service, and capital expenditures, including purchases of equipment and services, operating costs and expenses, and income taxes. Cash is managed at the holding company or the subsidiary level. There are no limitations or constraints on the movement of funds between the entities.

Current wording

The Marygold Companies is a holding company that conducts its operations through its subsidiaries. At the holding-company level, its liquidity needs relate to operational expenses, the funding of additional business acquisitions and new investment opportunities. Our operating subsidiaries’ principal liquidity requirements arise from cash used in operating activities, debt service, and capital expenditures, including purchases of equipment and services, operating costs and expenses, and income taxes. Cash is managed at the holding company or the subsidiary level. There are no limitations or constraints on the movement of funds between the entities.

Previous wording

As of December 31, 2023, we had $6.2 million of cash and cash equivalents on a consolidated basis as compared to $8.2 million as of June 30, 2023, a decrease of $2.0 million or 24%. For the six months ended December 31, 2023, USCF Investments invested $3.0 million by seeding one new Fund and the Company made additional expenditures of $2.8 million in Marygold. The Company expects that Marygold will require additional expenditures over the coming 12 months. As the funding requirements become known, the Company will decide upon the source of the additional capital investment to be made as the need arises.

Current wording

As of March 31, 2024, we had $4.5 million of cash and cash equivalents on a consolidated basis as compared to $8.2 million as of June 30, 2023, a decrease of $3.7 million or 45%. For the nine months ended March 31, 2024, USCF Investments invested $3.0 million by seeding one new fund and we made additional expenditures of $4.1 million in Marygold. We have invested a total of $13.5 million in the fintech app since Marygold’s inception. We expect that Marygold will require additional expenditures over the coming 12 months. As the funding requirements become known, we will decide upon the source of the additional capital investment to be made as the need arises. During the quarter ended March 31, 2024, we made a deposit of $1.8 million in connection with the potential acquisition of a 9.9% equity interest in a domestic financial institution that is currently seeking certain regulatory approval.

Previous wording

Based on our current operating plan, we believe existing cash resources will be sufficient to meet our working capital requirements for the next twelve months. If sufficient funds are not available to finance our business and operations, including our investment in Marygold, we may need to raise additional financing through one or more debt or an equity financing to meet our operating and cash needs. There can be no assurance we will be able to raise additional financing or upon terms that are acceptable to us.

Current wording

Based on our current operating plan, we believe existing cash resources will be sufficient to meet our working capital requirements for the next twelve months. If sufficient funds are not available to finance our business and operations, including our investment in Marygold, we may need to raise additional financing through one or more debt or an equity financing to meet our operating and cash needs. There can be no assurance we will be able to raise additional financing or obtain terms that are acceptable to us.

Previous wording

The Company has various operating leases for offices, warehouses and manufacturing facilities. The total amount due under these obligations was $1.4 million and $1.0 million as of December 31, 2023 and June 30, 2023, respectively. The obligations will reduce over the passage of time through periodic lease payments. See Note 11 for further analysis of this obligation.

Current wording

The Company has various operating leases for offices, warehouses and manufacturing facilities. The total amount due under these obligations was $1.1 million and $1.0 million as of March 31, 2024 and June 30, 2023, respectively. The obligations will reduce over the passage of time through periodic lease payments. See Note 11 for further analysis of this obligation.

Previous wording

As of December 31, 2023, we had $0.4 million of third-party indebtedness as compared to $0.3 million of third-party and related-party indebtedness as of June 30, 2023. Brigadier owes $0.4 million under a loan that is secured with the land and building in Canada. The initial principal balance was $0.6 million as of the loan date in July 2019 with an annual interest rate of 4.14% maturing June 30, 2024. Interest on the loan is expensed or accrued as it becomes due.

Current wording

As of March 31, 2024, we had $0.4 million of third-party indebtedness as compared to $0.3 million of third-party and related-party indebtedness as of June 30, 2023. Brigadier owes $0.3 million under a loan that is secured with the land and building in Canada. The initial principal balance was $0.6 million as of the loan date in 2019 with an annual interest rate of 4.14% maturing June 30, 2024. Interest on the loan is expensed or accrued as it becomes due.

Previous wording

In addition, Gourmet Foods has a finance lease liability of $0.2 million related to a solar energy system as December 31, 2023 and June 30, 2023, respectively, and are included under loans - property and equipment on our consolidated balance sheets.

Current wording

In addition, Gourmet Foods has a finance lease liability of $0.1 million related to a solar energy system as March 31, 2024 and June 30, 2023, respectively, and are included under loans - property and equipment on our consolidated balance sheets.

Previous wording

USCF Investments, from time to time, provides initial investments in the creation of ETP funds that USCF Investments manages. USCF Investments classifies these investments as current assets as these investments are generally sold within one year from the balance sheet date. As of December 31, 2023, USCF Investments held investment positions in four of its 40 Act funds, GLDX, ZSB, USE and ZSC of $1.3 million, $0.5 million, $2.7 million, and $2.6 million, respectively. As of June 30, 2023 USCF held positions in GLDX, ZSB, and USE of $1.3 million, $1.9 million, and $2.6 million, respectively. These investment positions along with other investments, as applicable, are described further in Note 7 to our Financial Statements.

Current wording

USCF Investments, from time to time, provides initial investments in the creation of ETP funds that USCF Investments manages. USCF Investments classifies these investments as current assets as these investments are generally sold within one year from the balance sheet date. As of March 31, 2024, USCF Investments held investment positions in four of its 40 Act funds, USG (renamed from GLDX in March 2024), ZSB, USE and ZSC of $1.3 million, $0.4 million, $3.2 million, and $2.3 million, respectively. As of June 30, 2023 USCF held positions in USG, ZSB, and USE of $1.3 million, $1.9 million, and $2.6 million, respectively. These investment positions along with other investments, as applicable, are described further in Note 7 to our Financial Statements.