Delaware
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1-14761
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13-4007862
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(State or Other Jurisdiction
of Incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.)
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191 Mason Street, Greenwich, CT
One Corporate Center, Rye, NY
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06830
10580
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of each class
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Trading Symbol
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Name of each exchange on which registered
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Class A Common Stock, .001 par value
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GBL
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New York Stock Exchange
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Item 2.02.
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Results of Operations and Financial Condition.
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Item 9.01.
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Financial Statements and Exhibits.
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Exhibit
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Number
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Description
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99.1
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GAMCO's Press Release, dated August 4, 2020
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Exhibit
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Number
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Description
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99.1
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GAMCO's Press Release, dated August 4, 2020
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For Immediate Release:
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Contact:
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Howard Green
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SVP of Corporate Development
(914) 921-7729
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For further information please visit
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www.gabelli.com
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-
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Second quarter net income was $11.3 million vs. $24.0 million a year ago
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-
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Fully diluted second quarter earnings were $0.42 per share versus $0.88 per share a year ago
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-
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June 30, 2020 AUM was $29.4 billion versus March 31, 2020 AUM of $27.5 billion
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Over the past several months, our business contingency plans have functioned well, allowing teammates to stay close to the companies we invest in and, at the same time, to focus on our clients. Our investment in technology has enabled the majority of our teammates to work-from-home to ensure their safety and health while allowing us to meet our clients’ needs.
Financial Highlights (Unaudited)
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||||||||
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Three Months Ended
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|||||||
(In thousands, except per share data)
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June 30, 2020
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June 30, 2019
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||||||
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||||||||
U.S. GAAP Basis
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||||||||
Revenues
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$
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57,559
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$
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76,407
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||||
Operating income
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18,763
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26,760
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||||||
Net income
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11,290
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24,017
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||||||
Diluted earnings per common share
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$
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0.42
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$
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0.88
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||||
Weighted average diluted shares outstanding
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26,656
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27,413
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||||||
Shares outstanding
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27,630
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27,743
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||||||
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||||||||
Assets Under Management
|
||||||||
AUM - average (in millions)
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$
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29,135
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$
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37,011
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||||
AUM - end of period (in millions)
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29,356
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36,924
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-
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Total revenues for the second quarter of 2020 were $57.6 million compared with $76.4 million in the second quarter of 2019.
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-
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Investment advisory fees were $51.5 million in the second quarter of 2020 versus $68.0 million in the second quarter of 2019:
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-
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Gabelli Funds’ revenues were $35.8 million compared to $44.2 million in the second quarter of 2019.
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-
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Institutional and Private Wealth Management revenues, which are generally billed on portfolio values at the beginning of the quarter, were $14.5 million compared to $22.2 million in the
year ago quarter.
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-
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SICAV revenues were $1.2 million versus $1.6 million in last year’s second quarter.
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-
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Distribution fees from our equity mutual funds and other income were $6.1 million for the quarter versus $8.4 million in 2019.
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-
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As a result of the COVID-19 pandemic, the majority of our teammates are working remotely. However, there has been no material impact of remote work arrangements on our operations, including
our financial reporting systems, internal control over financial reporting, and disclosure controls and procedures, and there has been no material challenge in implementing our business continuity plan.
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-
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On April 2nd, we hosted our 6th Annual Waste & Environmental Services Symposium via webcast. The timely conference featured presentations by leading companies.
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-
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Gabelli Funds filed the registration statement for the Gabelli ActiveShares ETFs in May. These actively managed ETFs will have the same tax and operating cost advantages of mindless ETFs
and will be priced intraday.
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-
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On May 15th, we hosted our 35th GAMCO Investor Client Symposium with over 500 clients and prospects attending on a virtual basis.
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-
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On June 4th, the 12th Annual Entertainment & Broadcasting Symposium hosted virtual presentations from more than a dozen companies in media and entertainment.
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Table I: Assets Under Management and Fund Flows - 2nd Quarter 2020 (in millions)
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||||||||||||||||||||
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Fund
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|||||||||||||||||||
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Market
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distributions,
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||||||||||||||||||
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March 31,
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appreciation/
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Net cash
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net of
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June 30,
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|||||||||||||||
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2020
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(depreciation)
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flows
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reinvestments
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2020
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|||||||||||||||
Equities:
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||||||||||||||||||||
Mutual Funds
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$
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7,798
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$
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1,171
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$
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(310
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)
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$
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(8
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)
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$
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8,651
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||||||||
Closed-end Funds
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6,084
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1,005
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(97
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)
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(133
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)
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6,859
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|||||||||||||
Institutional & PWM (a)
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10,185
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1,518
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(1,248
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)
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-
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10,455
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||||||||||||||
SICAV
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480
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37
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(66
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)
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-
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451
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||||||||||||||
Total Equities
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24,547
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3,731
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(1,721
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)
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(141
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)
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26,416
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|||||||||||||
Fixed Income:
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||||||||||||||||||||
100% U.S. Treasury Fund
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2,938
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4
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(21
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)
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-
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2,921
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||||||||||||||
Institutional & PWM
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20
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-
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(1
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)
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-
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19
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||||||||||||||
Total Fixed Income
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2,958
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4
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(22
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)
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-
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2,940
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||||||||||||||
Total Assets Under Management
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$
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27,505
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$
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3,735
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$
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(1,743
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)
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$
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(141
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)
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$
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29,356
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||||||||
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||||||||||||||||||||
(a) Includes $263 and $252 of 100% U.S. Treasury Fund AUM at March 31, 2020 and June 30, 2020, respectively.
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||||||||||||||||||||
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Table II
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||||||||||||||||
GAMCO INVESTORS, INC.
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||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
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||||||||||||||||
(In thousands, except per share data)
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||||||||||||||||
|
||||||||||||||||
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Three Months Ended
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Six Months Ended
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||||||||||||||
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June 30
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June 30
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||||||||||||||
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2020
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2019
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2020
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2019
|
||||||||||||
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||||||||||||||||
Investment advisory and incentive fees
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$
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51,470
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$
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67,990
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$
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113,743
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$
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133,878
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||||||||
Distribution fees and other income
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6,089
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8,417
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13,383
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16,865
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||||||||||||
Total revenues
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57,559
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76,407
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127,126
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150,743
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||||||||||||
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||||||||||||||||
Compensation costs (a) (b)
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25,516
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30,216
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54,766
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60,563
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||||||||||||
Management fee expense (a)
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2,060
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4,709
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3,725
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6,158
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||||||||||||
Distribution costs
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6,634
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8,605
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14,264
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17,275
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||||||||||||
Other operating expenses
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4,586
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6,117
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10,288
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11,374
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||||||||||||
Total expenses
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38,796
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49,647
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83,043
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95,370
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||||||||||||
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||||||||||||||||
Operating income
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18,763
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26,760
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44,083
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55,373
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||||||||||||
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||||||||||||||||
Investment income / (loss)
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424
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5,979
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(9,269
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)
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4,808
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|||||||||||
Interest expense
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(647
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)
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(655
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)
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(1,294
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)
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(1,310
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)
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||||||||
Non-operating income / (loss)
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(223
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)
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5,324
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(10,563
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)
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3,498
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||||||||||
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||||||||||||||||
Income before income taxes
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18,540
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32,084
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33,520
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58,871
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||||||||||||
Provision for income taxes
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7,250
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8,067
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10,985
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14,962
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||||||||||||
Net income
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$
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11,290
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$
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24,017
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$
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22,535
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$
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43,909
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||||||||
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||||||||||||||||
Net income:
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||||||||||||||||
Basic
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$
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0.42
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$
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0.88
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$
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0.85
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$
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1.57
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||||||||
Diluted
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$
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0.42
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$
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0.88
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$
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0.84
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$
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1.57
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||||||||
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||||||||||||||||
Weighted average shares outstanding:
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||||||||||||||||
Basic
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26,629
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27,357
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26,658
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27,929
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||||||||||||
Diluted
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26,656
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27,413
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26,713
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27,973
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||||||||||||
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||||||||||||||||
Actual shares outstanding (c)
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27,630
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27,743
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27,630
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27,743
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||||||||||||
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||||||||||||||||
(a) For the six months ended June 30, 2019, the CEO waiver reduced compensation costs and management
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||||||||||||||||
fee expense by $12,178 and $1,689, respectively.
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||||||||||||||||
(b) For the six months ended June 30, 2020, compensation costs were reduced by $1,409 due to indexing
|
||||||||||||||||
of deferred compensation to the GBL stock price.
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||||||||||||||||
(c) Includes 1,031 RSA shares at June 30, 2020 and 668 RSA shares at June 30, 2019.
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||||||||||||||||
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Table III
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||||||||||||
GAMCO INVESTORS, INC.
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||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
|
||||||||||||
(In thousands, except per share data)
|
||||||||||||
|
||||||||||||
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June 30,
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December 31,
|
June 30,
|
|||||||||
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2020
|
2019
|
2019
|
|||||||||
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||||||||||||
ASSETS
|
||||||||||||
Cash and cash equivalents
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$
|
58,117
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$
|
86,136
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$
|
52,008
|
||||||
Investments in U.S. Treasury Bills
|
49,963
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-
|
-
|
|||||||||
Investments in securities
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20,669
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34,273
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36,811
|
|||||||||
Receivable from brokers
|
4,677
|
989
|
4,188
|
|||||||||
Other receivables
|
22,501
|
41,557
|
28,176
|
|||||||||
Deferred tax asset and income tax receivable
|
9,032
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16,389
|
18,250
|
|||||||||
Other assets
|
9,353
|
10,542
|
10,923
|
|||||||||
Total assets
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$
|
174,312
|
$
|
189,886
|
$
|
150,356
|
||||||
|
||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||||||
Payable to brokers
|
$
|
-
|
$
|
-
|
$
|
99
|
||||||
Income taxes payable and deferred tax liabilities
|
4,740
|
757
|
1,935
|
|||||||||
Compensation payable
|
30,947
|
64,279
|
65,335
|
|||||||||
Accrued expenses and other liabilities
|
37,978
|
45,942
|
36,189
|
|||||||||
Sub-total
|
73,665
|
110,978
|
103,558
|
|||||||||
Senior Notes (due June 1, 2021)
|
24,203
|
24,191
|
24,180
|
|||||||||
Total liabilities
|
97,868
|
135,169
|
127,738
|
|||||||||
|
||||||||||||
Stockholders' equity (a)
|
76,444
|
54,717
|
22,618
|
|||||||||
|
||||||||||||
Total liabilities and stockholders' equity
|
$
|
174,312
|
$
|
189,886
|
$
|
150,356
|
||||||
|
||||||||||||
(a) Shares outstanding of 27,630, 27,380, and 27,743, respectively.
|
||||||||||||
|
Management believes the use of non-GAAP measures provides relevant information to allow investors to view operating trends, perform analytical comparisons and benchmark performance between periods for its
core operating results. Management uses non-GAAP measures in its financial, investing and operational decision-making process, for internal reporting and as part of its forecasting and budgeting processes. GAMCO’s calculation of non-GAAP
measures may not be comparable to other companies due to potential differences between companies in the method of calculation. Non-GAAP measures should not be considered a substitute for related U.S. GAAP measures.
|
|
Three Months Ended
|
|||
(Unaudited)
|
June 30, 2019
|
|||
(In thousands, except per share data)
|
||||
Net income, U.S. GAAP basis
|
$
|
24,017
|
||
Impact of DCCAs on expenses and taxes (a):
|
||||
Compensation costs
|
(603
|
)
|
||
Management fee expense
|
1,030
|
|||
Provision for income taxes
|
(102
|
)
|
||
Total impact of DCCAs on expenses and taxes
|
325
|
|||
Net income, as adjusted
|
$
|
24,342
|
||
|
||||
Per fully diluted share:
|
||||
Net income, U.S. GAAP basis
|
$
|
0.88
|
||
Impact of DCCAs
|
$
|
0.01
|
||
Net income, as adjusted
|
$
|
0.89
|
||
|
||||
(a) The non-GAAP adjustments relate to multiple DCCAs.
|