FRMO Corp. Announces Results for Fiscal 2018

FRMO Corp. (the “Company” or “FRMO”) (OTC Pink: FRMO) today reported its financial results for the fiscal year 2018, which ended May 31, 2018.

Financial Highlights

FRMO’s 2018 book value as of May 31, 2018 was $146.9 million ($3.34 per share on a fully diluted basis), including $27.6 million of non-controlling interests. The figure from the prior fiscal year-end as of May 31, 2017 was $114.2 million ($ 2.60 per share), which includes $10.9 million of non-controlling interests. Current assets, comprised primarily of cash and equivalents and investments available for sale, amounted to $93.2 million as of May 31, 2018, and $71.3 million as of May 31, 2017. Total liabilities were $13.5 million as of May 31, 2018, compared to $13.1 million as of May 31, 2017, the majority of each being deferred taxes. As a result of the new tax act, the Company reduced its previously recorded deferred tax liability by $4.5 million.

FRMO’s 2018 net income attributable to the Company for the fiscal year ended May 31, 2018 was $14,052,518 ($0.32 per share basic and diluted) compared to $3,493,948 ($0.08 per share basic and diluted) for the 2017 fiscal year. Income from operations for the 2018 fiscal year was $15,605,398, compared to $6,915,986, for the prior year. Comprehensive income attributable to the Company for the same periods was $14,835,607 up from $4,335,956.

As of May 31, 2018 and May 31, 2017, investments in limited partnerships and limited liability companies are valued using data inputs from March 31, 2018 and March 31, 2017, respectively, the dates of the most current available information.

Further details are available in the Company’s Consolidated Financial Statements for the fiscal year ended May 31, 2018. These statements and the Letter to Shareholders 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 2018 financial results and the outlook for the future. Board members will be available to answer questions.

Date:
Wednesday, September 12, 2018 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 25, 2018, 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,
		2018			2017
Assets
Current Assets:
Cash and cash equivalents		$	53,617		$	51,125
Bond and equity securities, available for sale, at fair value			38,522			18,933
Other current assets			1,095			1,219
Total Current Assets			93,234			71,277
Computer equipment, net of accumulated depreciation			76			-
Investment in South LaSalle Partners, LP			6,262			5,743
Investment in Winland Holdings Corporation, Inc.			773			739
Investments in managed funds			34,372			24,833
Investment in The Bermuda Stock Exchange			2,721			2,704
Investments in other stock exchanges			988			988
Investment in Digital Currency Group Inc.			76			76
Investment in cryptocurrency mining entities			113			-
Investment in Horizon Kinetics LLC			11,624			10,773
Participation in Horizon Kinetics LLC revenue stream			10,200			10,200
Total Assets		$	160,439		$	127,333
Liabilities and Stockholders' Equity
Current Liabilities:
Securities sold, not yet purchased		$	5,495		$	4,131
Other current liabilities			193			140
Total Current Liabilities			5,688			4,271
Deferred Tax Liability			7,757			8,842
Total Liabilities			13,445			13,113
Stockholders' Equity			146,994			114,220
Total Liabilities and Stockholders' Equity		$	160,439		$	127,333

Condensed Consolidated Statements of Operations
(amounts in thousands, except share data)
		Three Months Ended								Years Ended
		May 31,				May 31,				May 31,			May 31,
		2018				2017				2018			2017
		(Unaudited)
Revenue:
Consultancy and advisory fees		$	509			$	542			$	3,252		$	1,994
Equity earnings (loss) from partnerships
and limited liability companies			318				76				3,782			(21	)
Unrealized (loss) gain from investments			(6,508	)			(391	)			8,351			4,161
Equity earnings from investment in
The Bermuda Stock Exchange			3				2				17			62
Other			645				232				1,011			1,424
Total Revenue			(5,033	)			461				16,413			7,620
Total Expenses			198				172				808			704
(Loss) Income from Operations			(5,231	)			289				15,605			6,916
(Benefit) Provision for Income Taxes			(1,172	)			528				1,382			3,261
Net (Loss) Income			(4,059	)			(239	)			14,223			3,655
Less net income attributable to noncontrolling interests			206				77				171			161
Net (Loss) Income Attributable to FRMO Corporation		$	(4,265	)		$	(316	)		$	14,052		$	3,494
Diluted Net (Loss) Income per Common Share		$	(0.10	)		$	(0.01	)		$	0.32		$	0.08
Weighted Average Common Shares Outstanding
Basic			43,973,781				43,953,155				43,959,554			43,953,155
Diluted			43,973,781				43,998,274				44,007,828			44,000,015

About FRMO Corp.

FRMO Corp. invests in and receives revenues based upon consulting and advisory fee interests in the asset management sector.

FRMO had 43,973,781 shares of common stock outstanding as of May 31, 2018.

For more information, visit our website at www.frmocorp.com.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 – With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. Words like “believe,” “expect” and “anticipate” mean that these are our best estimates as of this writing, but that there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, the general economics of the financial industry, our ability to finance growth, our ability to identify and close acquisitions on terms favorable to the Company, and a sustainable market.

Further information on our risk factors is contained in our quarterly and annual reports as filed on our website www.frmocorp.com and on www.otcmarkets.com/stock/FRMO/filings.

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