NOVATO, Calif., May 14, 2020 /PRNewswire/ -- Hennessy
Advisors, Inc. (NASDAQ:HNNA) reported results for its second
fiscal quarter of 2020, which ended March
31, 2020, and announced a quarterly dividend of $0.1375 per share, which represents an annualized
dividend yield of 7.1%.* The dividend will be paid on June
9, 2020, to shareholders of record as of May 26, 2020.
"I hope this communication finds you and your loved ones safe
and healthy. Our hearts go out to the healthcare workers and first
responders here at home and in communities most affected by
COVID‑19. It may feel like the world has been turned upside down,
with schools, stores, restaurants, and businesses closed,
cancellations of every conceivable kind, and so many people
suddenly finding themselves unemployed or working from home. It may
even feel like the whole world is holding its breath, but here at
Hennessy, we are not. We quickly activated our established business
continuity plan, and our employees are working safely and
productively from home. Hennessy Advisors entered this crisis in a
solid financial position, and we paid off our debt during the
quarter to be prepared for whatever might come our way in the
future," said Neil Hennessy,
Chairman and CEO.
"This is an unprecedented global event, and the full extent of
the economic impact is unknown," Mr. Hennessy continued. "But
while the short-term effects have certainly been significant, even
brutal, I do not believe that they are terminal. Over my 41-year
history in the industry, I have witnessed extreme volatility and
economic uncertainty, and this current quarter was flush with both.
The major U.S. market indices hit all‑time highs in mid‑February,
but then lost over one-third of their value within just a matter of
weeks to end the quarter down approximately 20 - 25%, more than
cancelling the positive returns achieved over the prior 12 months.
Unemployment was at historic lows, but as shelter-in-place orders
rippled through the nation, unemployment claims skyrocketed. We
don't know what will happen as we reopen the economy, but as I look
at history, our economy and financial markets have always rebounded
and recovered. Since 1980, including some very tough economic
times, we've had just seven down years in the market, averaging a
loss of 9.2%, and 33 up years in the market, averaging a return of
18.5%.
"I trust that our government, community, and corporate leaders
are working diligently to get our economy back on the solid track
it was on before COVID-19. We at Hennessy fully understand that
this market volatility and economic uncertainty is jarring to many
investors, and while it may get worse before it gets better, I
firmly believe that it will get better. As always, but especially
in these trying times, we are here to support our Hennessy
Advisors, Inc. shareholders, the shareholders of our 16 funds, and
one another," added Mr. Hennessy.
"This worldwide pandemic presented some unparalleled challenges
over the past quarter. We experienced net outflows, and our assets
under management were significantly impacted by negative market
returns due to COVID-19, which in turn negatively affected our
financial results," said Teresa
Nilsen, President and Chief Operating Officer. "Our
operations are uninterrupted, and we remain focused on building our
company for the future through increased marketing and sales
activity and continuing to search for strategic acquisitions. I
want to thank our directors for their unwavering support and our
employees for remaining steadfast in helping our investors,
communities, and each other as we navigate this global crisis," she
added.
Summary Highlights (compared to the prior comparable
quarter ended March 31, 2019):
- Fully diluted earnings per share decreased 27% to $0.27.
- Total revenue decreased 15% to $8.9
million.
- Total assets under management decreased 35% to $3.3 billion.
- Average assets under management, upon which revenue is earned,
decreased 15% to $4.4 billion.
Financial
Highlights
|
|
|
|
Three Months Ended
March 31,
|
|
Change
|
|
|
2020
|
|
2019
|
|
Dollar
|
|
Percent
|
Total
revenue
|
|
$
8,879,000
|
|
$
10,455,504
|
|
$
(1,576,504)
|
|
-15.1%
|
Net income
|
|
1,970,207
|
|
2,900,445
|
|
(930,238)
|
|
-32.1%
|
Earnings per share
(diluted)
|
|
0.27
|
|
0.37
|
|
(0.10)
|
|
-27.0%
|
Average assets under
management
|
|
4,377,503,224
|
|
5,140,314,889
|
|
(762,811,665)
|
|
-14.8%
|
Weighted average
shares outstanding (diluted)
|
|
7,393,167
|
|
7,922,408
|
|
(529,241)
|
|
-6.7%
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2020
|
|
March 31,
2019
|
|
|
|
|
Cash and cash
equivalents
|
|
$
6,996,827
|
|
$
25,071,779
|
|
$
(18,074,952)
|
|
-72.1%
|
Gross loan
balance
|
|
-
|
|
19,687,502
|
|
(19,687,502)
|
|
-100.0%
|
Total assets under
management
|
|
3,319,932,075
|
|
5,135,936,999
|
|
(1,816,004,924)
|
|
-35.4%
|
|
* Based on the
closing stock price of $7.78 on May 13, 2020, and an annualized
dividend of $0.55 per share.
|
About Hennessy Advisors, Inc.
Hennessy Advisors, Inc.
is a publicly traded investment manager offering a broad range of
domestic equity, multi-asset, and sector and specialty mutual
funds. Hennessy Advisors, Inc. is committed to providing superior
service to shareholders and employing a consistent and disciplined
approach to investing based on a buy‑and‑hold philosophy that
rejects the idea of market timing.
Supplemental Information
Nothing in this press release
shall be considered a solicitation to buy or an offer to sell a
security to any person in any jurisdiction where such offer,
solicitation, purchase, or sale would be unlawful under the
securities laws of such jurisdiction.
Forward-Looking Statements
This press release
contains "forward-looking statements" for which Hennessy Advisors,
Inc. claims the protection of the safe harbor contained in the
Private Securities Litigation Reform Act of
1995. Forward-looking statements relate to expectations and
projections about future events based on currently available
information. Forward‑looking statements are not a guarantee of
future performance or results and are not necessarily accurate
indications of the times at which, or means by which, such
performance or results may be achieved. Forward-looking
statements are subject to risks, uncertainties, and assumptions,
including those described in the sections entitled "Risk Factors"
and elsewhere in the reports that Hennessy Advisors, Inc. files
with the Securities and Exchange Commission. Unforeseen
developments could cause actual performance or results to differ
substantially from those expressed in, or suggested by, the
forward‑looking statements. Hennessy Advisors, Inc. management does
not assume responsibility for the accuracy or completeness of the
forward-looking statements and undertakes no responsibility to
update any such statement after the date of this press release to
conform to actual results or to changes in expectations.
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SOURCE Hennessy Advisors, Inc.