Good afternoon and thank you for joining us today for our webcast announcing U.S. Global Investors' results for the Third Quarter of Fiscal Year 2018. I'm Holly Schoenfeldt. If you have any question during the webcast, you can enter them in the questions area of the control panel sidebar which is normally to the right of your screen. Also, you may download a PDF of today's slides by clicking on the red handout button. The presenters for today's program are Frank Holmes, U.S. Global Investors' CEO and Chief Investment Officer; Susan McGee, President, General Counsel, and Chief Compliance Officer; and Lisa Callicotte, Chief Financial Officer. During this webcast, we may make forward-looking statements about our relative business outlook. Any forward-looking statement and all other statements made during this webcast that don't pertain to historical facts are subject to risks and uncertainties that may materially affect actual results. Please refer to our press release and corresponding Form 10-Q filing for more detail on factors that could cause actual results to differ materially from any described today in forward-looking statement. Any such statements are made as of today, and U.S. Global Investors accepts no obligation to update them in the future. A quick overview about U.S. Global Investors, U.S. Global is an innovative investment manager with vast experience and global market and specialized sector, it was founded as an investment club, the Company became a registered investment advisor in 1968 and has had a longstanding history of global investing and launching first of their kind investment products, including the first-no load gold fund, U.S. Global is well known for expertise in gold and precious metals, natural resources and emerging market. Now let's go to Frank Holmes, CEO and CIO, for an overview of the period. Frank?

Well I'll talk about the strengths, and I think that we strive to be a go-to-stock for exposure emerging markets, resources and now digital currencies, mining of digital currencies which has had a significant impact on our balance sheet and income statement and created for normal volatility, and I'll share the story little bit more as we go through the presentation. We remain debt free, we have a strong balance sheet and we have a very much reflexive cost structure. We maintained the monthly dividend and a return on equity discipline which has been a big challenge with Mutual Fund industry continue to shrink as a whole and money going into predominantly ETFs and predominately big cap ETFs and where fees are the number one driver not so much the performance, but fees. So we're in this of interesting place in the capital markets, but where we've shown the growth is in our new products, Lisa will highlight and talk a little bit more in detail. But I wanted to thank our top shareholders, the Royce funds have maintained with us that they are the largest shareholder then we had the Financial Investment Group, Management Group at Michigan. We have BlackRock Institutional Trust Company with the Vanguard, one of their indexes, and then we have Arbiter Partners Capital Management which showing up as a new investor. We want to thank them all and all the other shareholders that have been on this ride with us because in the past six months since we made the investment into HIVE Blockchain Technology, our stock and volume has gone up substantially, and so as the volatility of our stock price and I'll relate that more in detail as I talk about the Cryptocurrency world. Growth and dividends, we've been consistent 10 years. Currently…

Thank you, Frank. Good afternoon. Before I summarize our results of operations, I'd like to discuss the accounting treatment related to our direct and indirect investments in HIVE. USGI, through its wholly-owned subsidiaries, U.S. Global Investors Canada Limited, directly owns 10 million shares of HIVE. These shares are included in investment securities available for sale on our balance sheet. In unrealized gains and losses on available-for-sale securities are excluded from earnings, and recorded in other comprehensive income, as a separate component of shareholders' equity, until realized. USGI Canada also invest in the Galileo Partners Fund, and the Galileo Tech and Blockchain Fund. At March 31, 2018, USGI Canada owned approximately 26% of the Galileo Partners Fund and 20% of the Galileo Technology and Blockchain Fund, and the Partners Fund owned approximately 5 million shares of HIVE, while the Galileo Tech and Blockchain Fund on approximately 95,000 shares of HIVE.

And that excludes my investments, directly.

The investments in Galileo Funds are accounted for under the equity method of accounting and under this method, the Company's proportional share of the fund's net income and loss, which primarily consists of realized and unrealized gains and losses on investments decreased by fund expenses, is recognized in the Company's earnings. Now I'll discuss a result of operations for the quarter ending March 31, 2018. Beginning on Page 38, we recorded total operating revenues of $1.4 million for the quarter. This is a 15% decrease from the $1.7 million we reported for the same quarter last year. The decrease is primarily due to decrease in average assets under management, due to market depreciation and shareholder redemption, but were somewhat offset by an increase in ETF advisory fees as a result of increase ETF average assets. USGIF performance fees paid down the quarter also increased having a negative impact on our revenues. Our operating expenses for the quarter were $2 million. This is an increase of $147,000 or 8%. The increase is primarily due to increases in employee compensation and benefits due to increase in bonuses and increase in general and administrative expenses primarily due to increase ETF cost and travel expenses. We have an operating loss of $590,000 in the quarter versus an operating loss of $191,000 for the same quarter prior year. On Page 39, we see we have another loss of $643,000 for the quarter, compared to other income of $161,000 for the same quarter ending March 31, 2017. $927,000 of this decrease is related to our equity investment in the Galileo funds. This loss is somewhat offset by an increase in investment income of approximately $114,000. And then we have a loss in our equity method investment for the quarter due to the volatility of these investments.…

Thank you, Lisa. As you can see, a majority of our mutual fund assets are in emerging markets and natural resources, and we have about 30% in domestic equities and fixed income fund. And for distributions, more than three quarters of our assets are coming from retail investors and then the other quarter from institutional investors. Our sales and marketing efforts have continued to focus on our mutual funds, particularly that are concentrated on gold, natural resources and emerging markets and then we also focused on our exchange-traded funds. We're pleased that we have received Nemours awards again from Thomson Reuters Lipper of the year and we have been recognized by Morning Star. Investors can find more information about our funds on our website usfund.com. The Company and our funds also continue to receive invaluable amount of viral publicity which is gained through media interviews. Frank Holmes often shares his insights with financial outlets like CNBC Asia, Bloomberg Television, CNN TV in Canada to name a few. We continue to receive recommendations by influential financial newsletter writers and we are also able to share and syndicate our award-winning original content by third-party publishers. These newsletters have very loyal following, and they do receive millions of visitors each month. Frank Holmes our CEO Blog, Frank Talk, also continues to grow in popularity. His commentary is often featured by prominent publications including Forbes, Seeking Alpha, ValueWalk, and business insider, and these have millions of monthly visitors. We like to call Frank a globetrotter because he, along with others in our investment team, do travel around the world to share our thought leadership. We interact frequently with loyal followers on Facebook, Twitter, LinkedIn, Instagram, YouTube and Pinterest. In December, we launched a new video series that supplements our award-winning Frank Talk blog. Frank…

And just as a reminder, to our audience, you can enter your questions in the control panel on your screen. And we had a few already. Frank is going to direct the first one for you which is, “where do you see the price of gold going as we head into the second half of the year and what will that mean for growth?”

The biggest thing is the headwind has been rising interest rates in the U.S. and it looks like it will have one more rate rise. The Europe has not, the UK hasn't. PMI which I showed earlier versus manufacturers indexes has peeked and is rolled over is not crashing ending the slowdown, but I think the fact is pulled over will slow down this rate rise, but the demand for gold will remain robust. I think the GDP per capita of China and India for the Love Trade 6% of all gold demand is love and it's highly correlated to rising GDP per capita income in those two countries were 4% of the world's population. So I remain very bullish and I think that gold can easily test $1,500 this year.

Another one which you kind of already touched on Frank, but just to revisit it. “Do you think that in pending regulation of the digital currency space? Is that good or a bad thing, especially for company like HIVE?”

Well, HIVE gets pulled into the volatility because we validate coins. We don't have any AML risks or KYC issues nor your client rules et cetera, which have really slowed down banking the whole movement of money in capital. And so that's not our biggest issue, but we think that there's been a fraud and there's been some real sloppiness on these new ICOs, millennials don't want to speculate in the stock market because it's too difficult, it takes five minutes to open account on coin based, to ten minutes and it can take you a week up a brokerage account. And they're going to go and trade these currencies and coins very readily, and so speculate of money of $5 billion has gone into creation of 1,000 new coins last year, and still this year even with the regulatory for announcements there's been new coins of say $30 million or $100 million offering that are been successfully raised capital. George Soros has gone into the space. The Goldman Sachs has gone into the space. So I think that the issue is there some regulations for [indiscernible] disclosure of these ICOs that they cannot say there are a currency where they don't pass the tests and it's called the how we test, and it's a very specific test that says, that if you quack like a duck, and you walk like a duck, you are a duck. And you can't say that you're an eagle. And so that's been something that's positive for this overall industry.

Great. One last question and then we can close things out. Are there any business or product related update from Galileo that you'd like to share?

I think that all of us in the mutual fund world are struggling with costs and just tremendous cost to market. The cost of launching a product, a fintech product is substantially less than what we have to and what they can go and say and do. So I see that the proliferation, so I think the regulatory burden from audits or whatever you have is very expensive in Canada for mutual funds as it is here and the marketing costs et cetera is - and communicate with the public is also very, very expensive. And so I think that the growth will be in the ETF in the separate account business, and still exploring with a separate account opportunities because I think that that's where this industry is growing. But Susan, you're on the Board of ICI and there is no real growth in mutual funds.

No.

No. And the growth in ETS is basically three institutions that captured all and something like 50% of all their flows are indexes that are cheapest, but I do think we're going to get a hiccup when you have BlackRock and Vanguard owning 10% of 100 companies in the S&P index and all of a sudden there's big redemptions they have to sell, because we have seen that in a very mini-scale with the GDXJ unraveling and hitting the market. They brought in $5 billion and all of the sudden they owned too much of a company and they had to go and sell quickly $3 billion and they just crushed this time last year, the gold industry. So I think there's only a matter of time before it's going to happen with a big cap stocks and all of a sudden that something happens of that nature. And then separate account is just a much safer way to play. And I think the other thing we have recognized is, I've written about it is the Financial Times of the great story of it. The 70% of the trading today are [indiscernible]. And so one of things we've done for an help our fund performance is called quantamentals, where you using quantitative tools and that those disciplines couple fundamental analysts to look at fundamentals and that that process, a thought process was the backbone to launching jets, which is going to - everything has said we'll do and then GOAU.

Great. Thank you.

All right. This concludes the U.S. Global Investors webcast for the third quarter 2018. The presentation will be available on our website at www.usfunds.com. Thank you all for your participation today.