Great Elm (US:GEG)2023-05-07 02:09Financial Data and Key Metrics Changes - For the quarter, revenues increased by 92% year-over-year, driven by higher assets under management and management fees related to GECC and Monomoy [29] - Adjusted EBITDA loss for the quarter was $1.2 million compared to $1.6 million in the prior year period [15] - The company reported a net loss from continuing operations of $0.5 million compared to a net loss of $6.5 million in the prior year period, primarily due to $2 million in net realized and unrealized gains on investments [29] Business Line Data and Key Metrics Changes - Assets under management (AUM) reached $631 million as of March 31, 2023, a 2% increase from the prior quarter and a 4% increase fiscal year-to-date [29] - Fee-paying AUM grew to $439 million, up 1% quarter-to-date and over 8% fiscal year-to-date [29] Market Data and Key Metrics Changes - The company completed two significant transactions, generating over $70 million of cash to GEG's balance sheet from the sale of its interests in Forest Investments and the DME business [21] - The company has not seen a credit crunch affecting its ability to fund transactions, instead identifying more opportunities due to banks pulling out of the market [16] Company Strategy and Development Direction - The company has transformed from a diversified holding company to a focused alternative asset manager, aiming to grow assets under management, improve profitability, and expand its platform [20] - The management highlighted a healthy pipeline of new business opportunities and a clean liquid balance sheet to execute upon them [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of Monomoy properties despite a slowdown in transactions due to high cap rates in the industrial space [17] - The company is well-positioned to achieve its strategic goals and is focused on proving its ability to grow and improve profitability [20] Other Important Information - The company announced the resignation of its CEO, with Jason Reese appointed as the new CEO [4] - The company has a strong institutional back office capable of servicing its growing platform [20] Q&A Session Summary Question: What is the impact of the credit crunch on spreads at GECC and the company's ability to fund transactions? - Management indicated that they have not seen a credit crunch affecting their funding capabilities and are actually seeing more opportunities for transactions [16] Question: What is the growth strategy now that Great Elm does not have a significant NOL? - Management acknowledged that while they still have an NOL, it is not as large as before, and they are optimistic about the Monomoy space despite current market conditions [17]