Good afternoon. Welcome to B. Riley Financial Second Quarter 2018 Earnings Conference Call. My name is Sabi and I will be your conference operator today. B. Riley Financial had issued a press release with financial results for the second quarter 2018 earlier today, which can be found in the Investor Relations section of the company’s website. Joining us for today to discuss the company’s Q2 results are B. Riley’s Financial Chairman and Co-CEO, Bryant Riley; Tom Kelleher, Co-CEO; and Phil Ahn, CFO and COO. After the speaker’s remarks, we will open the line for question-and-answer session. And before we conclude today’s call, I’ll provide the necessary cautions regarding the forward-looking statements made by management during this call. As a reminder, today’s call will be recorded and a replay will be made available on B. Riley’s website at ir.brileyfin.com. And now, I’d like to pass the call over to Mr. Bryant Riley. Mr. Riley, please proceed.

Thanks, operator, and thanks to everyone joining us for our call this afternoon. This is an exciting time for B. Riley Financial. As you can see from our results, we experienced strength in most of our businesses, which we believe speaks to the power of our combined platform and the diverse revenue streams up from offers. Our Q2 results exceeded our previous guidance with $41.4 million in adjusted EBITDA and $17 million in net income, which we’ve previously estimated to be in the range of $38 million to $40 million for adjusted EBITDA and $14.3 million to $15.3 million for net income. We’ve emphasized our B. Riley FBR and Great American retail liquidations division as the primary contributors to our second quarter results and our guidance. However, it’s important to note that each of our segments contributed to the strength in our Q2 results. We continue to see steady growth in our Appraisal businesses and cash flow generated by United Online business. These contributions combined with our continued focus on expense management helped improve our overall profit margins. We’re seeing more opportunities than ever through our combined platform, which has allowed us to create unique opportunities on both multiple parts of our businesses. Examples like Bon Ton, Toys "R" Us and most recently our participation in Vintage Capital’s acquisition of Rent-A-Center demonstrate our ability to be effective in this strategy. Taken together, we believe these results speak to the collective efforts our team has taken to build on our franchise and to drive momentum across our B. Riley Financial platform. And with some of that momentum, we’ve recently announced some executive leadership changes to help continue the strength in our position as we look forward. Andy Moore is now CEO of B. Riley FBR, our investment banking and institutional brokerage…

Thanks, Bryant, and welcome, everyone. Our revenues for the second quarter of 2018 totaled $125.5 million, up from $66.7 million for the same year ago period. The significant year-over-year increase reflects contributions related to our – from our acquisitions of FBR and Wunderlich Securities, which we completed in June and July of last year, respectively. Now turning to our revenue mix by segment. Our Capital Market segment is primarily driven by results from our combined investment banking and institutional brokerage business of B. Riley FBR as well as results from Wunderlich Securities, which we have recently predate B. Riley Wealth Management. Our Capital Markets segment also includes results from our asset management and securities lending businesses. For the second quarter of 2018, Capital Markets segment revenues totaled $77.8 million, which includes $71.2 million in revenues generated from services and fees as well as $6.6 million in revenues generated from interest income via our securities lending business. Revenues for this segment increased from $23.9 million from the same year ago period. Segment income of $12 million for the second quarter of 2018 compares to a loss of $4.8 million in the same year ago period. Again, the year-over-year increase for this segment is primarily driven by the addition of revenues associated with our acquisitions of FBR and Company and Wunderlich Securities in 2017. Next is our Auction and Liquidation segment. This segment is primarily driven by results from our Great American retail liquidations division. Total revenues for this segment increased to $26.8 million, up from $21.8 million from the same year ago period and $15.5 million in the first quarter of 2018. This increase was primarily driven by our participation in large retail liquidation projects in the second quarter. Segment income increased to $16.3 million for the second quarter of 2018…

Thanks, Tom. As mentioned in my earlier remarks, we believe our overall results speak to the continued momentum in our business, which accelerated around this time last year when we added FBR and Wunderlich to our B. Riley Financial. Since then we’ve continued to focus on consolidating internal operations and vendors, efforts which have contributed to greater efficiencies across the business and significantly improved our profit margins. But for us, most notably, our team is in focus on driving collaboration to partner on opportunities that has the potential to benefit all of our companies. Our success from this effort is evidenced by a number of recent high-impact engagements that our teams have collaborated on by leveraging the resources, relationships and collective expertise offered across the B. Riley Financial network. Moving to the brokerage side of our Capital Markets segment. In Q2, we successfully completed two large SPAC IPOs for Trinity Merger Corp. and LF Acquisition Corp, which represented $500 million of gross proceeds raised by B. Riley FBR as the sole bookrunner on both these deals. Trinity was our largest sold IPO to date bringing proceeds of $345 million. We also closed a major restructuring deal in Q2 and saw strong performance from our aftermarket or ATM business, which also contributed to our results for the quarter. Our 19th Annual Investor Conference in May was our largest and most successful conference to date. We believe this is a testament to B. Riley FBR’s commitment to our clients and research segments, despite a challenging backdrop for our active small cap investor clients, as it relates to secondary revenue. Despite this trend, we continue to demonstrate our commitment to providing an outlet for our research and we will be hosting our inaugural Healthcare Conference in New York on September 4. On the…

[Operator Instructions]. Our first question comes from Wes Cummins with Nokomis Capital. Please go ahead.

Hey, thanks. Hey, Bryant, I got just a couple of questions. One, on Bon Ton, you don’t really recognize any of the revenue until the full process is completed. Am I thinking about that right? Or do you recognize some as you go through the process?

So very little. The Bon Ton is so different and that we’ve really acquired the whole company, so we own the real estate, we own the inventory, we own the IP. So what we mentioned on the call that the inventory sale will end at the end of August, the real estate could go on for another six months and there is other assets throughout the company that will be sold over a period of time. So that one’s a little trickier. Usually, in general, liquidation, we do not recognize anything until either we’re far into profitability and it swings over a quarter or until it’s over. Phil anything you want to add to that?

No, I think that’s right. The liquidation sale, the inventory liquidation sale is set to conclude at the end of August, but the real estate sales will continue beyond there.

Okay. And then I know you can’t comment on the actual process, but the Rent-A-Center is kind of a big deal and may be a different deal than I’ve seen that you guys do in the past. May be if you could just comment if that – you think that opens up more opportunity in that area?

So I think we’ve talked about previously that one of the things that we think makes us unique is our willingness to use our balance sheet to create opportunities, whether it’s Principal Investments or whether it’s back stopping a transaction And now, given our direct lending fund and distribution through institutions and obviously the wealth management with over $8 billion of assets, the ability for us to be able to do that is extensive. And if you look at our balance sheet, Wes, we still got $70 million in net cash. And if you take our trailing 12 months and you add in magicJack’s public numbers, you’ve got $120 million of EBITDA there. So we think we have lots of room in our balance sheet to do some interesting things. We will be aggressive looking for ways to create value for our shareholders, and we think that, that area of creating a – using our balance sheet to create some of those dynamics and really interesting investments is absolutely something we will do more of.

Okay. thanks.

All right. Thanks, Wes.

[Operator Instructions]. There are no more questions at this time. At this time...

Sorry, go ahead.

We have a question from Heath Winter with ArbitrOption. Please go ahead.

Hi. Heath Winter with ArbitrOption Capital calling. A quick question for you. With regard to the magicJack transaction and where we stand in the process at this point. Is this where you expected it to be, or are things taking longer than you’d anticipated?

I would like to tell you exactly how I feel about magicJack. And if I knew the answer as to what I can tell you, I would. It’s obviously a public company and I have been told that anything around the public company transaction, I just can’t speak to. And I say that honestly, I say that I wish I could, but I just have been told not to speak to the actual process. I apologize.

At this time, this concludes our question-and-answer session. I’d now like to turn the call back to over to Mr. Bryant Riley for his closing remarks.

Okay. Well thanks, again, everyone who joined on the call and a special thanks to our employees, partners and investors for your continued support. We look forward to updating you on your next call. Thank you, everyone.

This concludes today’s conference call. You may now disconnect your lines. Thank you for participating and have a nice day.