Associated Capital Group(AC) - 2024 Q2 - Quarterly Report

Financial Performance - Total revenues for Q2 2024 were $2.6 million, an increase from$ 2.4 million in Q2 2023, with GAMCO International SICAV revenues rising to $1.3 million from$ 1.0 million[103]. - Net income attributable to shareholders for Q2 2024 was $2.985 million, down from$ 3.371 million in Q2 2023, representing a decrease of about 11.4%[102]. - Total revenues for the six months ended June 30, 2024, were $5.6 million, an increase of 16.7% compared to$ 4.8 million in the same period of 2023[107]. - Interest and dividend income increased to $7.9 million in the 2024 quarter from$ 6.0 million in the 2023 quarter, driven by higher sustained interest rates[106]. - Net cash provided by operating activities was $28.6 million for the six months ended June 30, 2024, compared to$ 179.4 million in the same period of 2023[119][120]. Expenses - Total expenses increased to $6.269 million in Q2 2024 from$ 5.853 million in Q2 2023, marking an increase of approximately 7.1%[102]. - Compensation expenses rose to $3.942 million in Q2 2024 from$ 3.789 million in Q2 2023, primarily due to higher stock-based compensation[105]. - Management fee expense for Q2 2024 was $0.442 million, down from$ 0.544 million in Q2 2023, indicating a decrease of about 18.7%[102]. - Other operating expenses increased to $4.1 million during the six months ended June 30, 2024, compared to$ 3.0 million in the prior year, driven by marketing expenses on the newly realigned SICAV[109]. - Compensation expenses rose to $7.8 million for the six months ended June 30, 2024, compared to$ 7.4 million in the prior year, primarily due to higher stock-based compensation[109]. Assets and Equity - Average assets under management (AUM) decreased to $1,446 million in Q2 2024 from$ 1,640 million in Q2 2023, reflecting a decline of approximately 11.8%[95]. - The company ended Q2 2024 with approximately $880.6 million in cash and investments, providing flexibility for strategic objectives[99]. - Total shareholders' equity increased to$ 915.5 million as of June 30, 2024, up from $907.0 million at the end of 2023, reflecting a growth of approximately 0.6%[100]. - Assets under management decreased to$ 1.4 billion as of June 30, 2024, down from $1.6 billion at December 31, 2023, primarily due to investor outflows[112]. - Total AUM for Merger Arbitrage decreased by 14.1% from$ 1.312 billion at December 31, 2023, to $1.127 billion at June 30, 2024[113]. Legal Matters - The company is not currently subject to any legal proceedings that involve claims exceeding 10% of its consolidated assets[127]. - Management believes that potential legal matters are not material to the company's financial condition, operations, or cash flows as of June 30, 2024[127]. - The condensed consolidated financial statements include necessary provisions for probable and estimable losses related to legal actions[127]. - The company evaluates reasonably possible losses and makes necessary disclosures if material[127]. - The company may be named in legal actions seeking substantial or indeterminate compensatory damages[127]. - The company is subject to governmental or regulatory examinations that could result in adverse judgments or settlements[127]. - Legal actions may seek punitive damages or injunctive relief[127]. - The company has provisions for losses that it believes are probable[127]. - Management assesses the materiality of potential losses from legal proceedings[127]. - The company is not currently facing any material legal challenges that could impact its financial performance[127]. Operating Loss - The company reported an operating loss of$ 3.674 million for Q2 2024, compared to an operating loss of $3.471 million in Q2 2023[102]. Tax Rate - The effective tax rate for the three months ended June 30, 2024, was 19.1%, significantly lower than 35.8% in the same period of 2023, due to deferred tax benefits from a foreign investment[107]. Investment Performance - Investment losses were$ 0.2 million in the 2024 quarter, a decline from gains of $3.3 million in the comparable 2023 quarter[106]. Book Value - Book value per share increased to$ 42.87 as of June 30, 2024, compared to $41.41 as of June 30, 2023, reflecting a growth of approximately 3.5%[95].