Financial Performance - Non-GAAP Net Sales reached $119.6 million, a 10% increase compared to Q2 2024, driven by domestic demand growth[14] - Pro Forma Adjusted EBITDA increased by 26% to $46.3 million compared to Q2 2024, attributed to organic revenue growth and operational efficiencies[15] - The company is raising full year guidance for Non-GAAP Net Sales to approximately $455 million and Pro Forma Adjusted EBITDA to approximately $158 million[16] - Holdings Domestic Net Sales increased by 22% reaching $104.3 million in Q2 2025[66] - Holdings International Net Sales decreased by 35% reaching $15.3 million in Q2 2025[66] - Holdings Gross Margin increased by 588 bps reaching 57.5% in Q2 2025[66] Market and Strategic Positioning - Metal payment cards represent less than 1% of total payment card shipments per year, indicating a growth opportunity[10,40] - The company is focused on increasing its share of metal card issuance as overall payment card volumes expand[38] - The company is making strategic investments in personnel and manufacturing to support long-term growth[30] Product and Customer Wins - The company secured high-profile card program wins and upgrades, including Chase Sapphire Reserve, Crypto.com, Gemini, XP, and MGM[15,33] - The Coinbase One Card, powered by Arculus, launched as the first crypto card on the American Express network[15]

[EXPLANATORY NOTE REGARDING CHANGE TO EQUITY METHOD ACCOUNTING](index=4&type=section&id=EXPLANATORY%20NOTE%20REGARDING%20CHANGE%20TO%20EQUITY%20METHOD%20ACCOUNTING) The company transitioned to the equity method for CompoSecure Holdings, L.L.C. (Holdings) due to a spin-off and Management Agreement, effective February 28, 2025 - Effective **February 28, 2025**, CompoSecure Holdings, L.L.C. (Holdings) is no longer consolidated in the Company's financial statements due to the spin-off of Resolute Holdings and a related Management Agreement Holdings' results are now accounted for under the **equity method**[10](index=10&type=chunk) - Under the **equity method**, Holdings' accounts are not reflected in the Company's consolidated balance sheets and statements of operations Instead, the Company's share of Holdings' earnings is reported as '**earnings from equity method investment**,' and its carrying value as '**equity method investment**' on the balance sheet[10](index=10&type=chunk) [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=4&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENT) This report contains forward-looking statements based on management's beliefs and assumptions, inherently subject to various risks and uncertainties - This report contains forward-looking statements based on management's beliefs and assumptions, which are inherently subject to risks, uncertainties, and assumptions and are not guarantees of performance[12](index=12&type=chunk)[13](index=13&type=chunk) - Key factors that could cause actual results to differ materially include **rapidly evolving domestic and global economic conditions**, **failure to retain existing customers**, **data and security breaches**, **system outages**, **inability to recruit qualified personnel**, **challenges in developing and commercializing new products** (especially **Arculus technology**), **supply chain disruptions**, and risks related to the **management of the business by Resolute Holdings**[13](index=13&type=chunk)[15](index=15&type=chunk) [Part I. Financial Information](index=6&type=section&id=Part%20I.%20Financial%20Information) This section presents the company's financial information, including statements and management's discussion and analysis [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements of CompoSecure, Inc., including balance sheets, statements of operations, comprehensive income, stockholders' deficit, and cash flows, along with detailed notes The financial statements reflect significant changes due to the spin-off of Resolute Holdings and the subsequent accounting for CompoSecure Holdings, L.L.C. (Holdings) under the equity method, effective February 28, 2025 [Consolidated Balance Sheets (Unaudited)](index=7&type=section&id=Consolidated%20Balance%20Sheets%20(Unaudited)) The consolidated balance sheets reflect the company's financial position, highlighting assets, liabilities, and equity changes due to the spin-off | Metric | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------------------- | :----------------------------- | :------------------------------- | :---------------------- | :--------- | | Total assets | 317,296 | 473,918 | (156,622) | -33.05% | | Total liabilities | 423,672 | 617,364 | (193,692) | -31.37% | | Total stockholders' deficit | (106,376) | (143,446) | 37,070 | 25.84% | | Cash and cash equivalents | 4,808 | 77,461 | (72,653) | -93.79% | | Accounts receivables | — | 47,449 | (47,449) | -100.00% | | Inventories, net | — | 44,833 | (44,833) | -100.00% | | Equity method investment | 44,739 | — | 44,739 | N/A | - The **significant decrease** in **total assets** and **total liabilities** is primarily due to the **deconsolidation of Holdings** and its subsidiaries, which are now accounted for as an **equity method investment**[10](index=10&type=chunk)[18](index=18&type=chunk) [Consolidated Statements of Operations (Unaudited)](index=9&type=section&id=Consolidated%20Statements%20of%20Operations%20(Unaudited)) The consolidated statements of operations detail the company's financial performance, including net sales, gross profit, and net income, significantly impacted by deconsolidation | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Net sales | — | 108,567 | (108,567) | -100.00% | | Gross profit | — | 56,072 | (56,072) | -100.00% | | (Loss) income from operations | (2,656) | 31,793 | (34,449) | -108.36% | | Other income (expense), net | (64,140) | 2,062 | (66,202) | -3210.57% | | (Loss) income before income taxes | (66,796) | 33,855 | (100,651) | -297.30% | | Income tax benefit (expense) | 1,762 | (258) | 2,020 | -782.95% | | (Loss) income before earnings in equity method investment | (65,034) | 33,597 | (98,631) | -293.57% | | Earnings in equity method investment | 38,909 | — | 38,909 | N/A | | Net (loss) income | (26,125) | 33,597 | (59,722) | -177.79% | | Net (loss) income attributable to CompoSecure, Inc. | (26,125) | 11,099 | (37,224) | -335.38% | | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- |\ | Net sales | 59,824 | 212,577 | (152,753) | -71.86% | | Gross profit | 28,749 | 111,285 | (82,536) | -74.17% | | Income from operations | 3,388 | 62,928 | (59,540) | -94.61% | | Other income (expense), net | (36,532) | (12,836) | (23,696) | 184.60% | | (Loss) income before income taxes | (33,144) | 50,092 | (83,236) | -166.17% | | Income tax (expense) benefit | (25,242) | 578 | (25,820) | -4467.13% | | (Loss) income before earnings in equity method investment | (58,386) | 50,670 | (109,056) | -215.24% | | Earnings in equity method investment | 53,753 | — | 53,753 | N/A | | Net (loss) income | (4,633) | 50,670 | (55,303) | -109.14% | | Net (loss) income attributable to CompoSecure, Inc. | (4,633) | 17,041 | (21,674) | -127.19% | - The **100% decrease** in **net sales** and **gross profit** for the three months ended June 30, 2025, and **significant decreases** for the six-month period, are primarily due to the **deconsolidation of Holdings**, which is now accounted for under the **equity method**[19](index=19&type=chunk)[160](index=160&type=chunk)[171](index=171&type=chunk) - A new line item, '**Earnings in equity method investment**,' reflects Holdings' performance, contributing **$38,909 thousand** for Q2 2025 and **$53,753 thousand** for H1 2025[19](index=19&type=chunk) - The company reported a **net loss of $(26,125) thousand** for Q2 2025 and **$(4,633) thousand** for H1 2025, a **significant shift** from **net income** in the prior year periods[19](index=19&type=chunk) [Consolidated Statements of Comprehensive (Loss) Income (Unaudited)](index=10&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20(Loss)%20Income%20(Unaudited)) These statements present the company's comprehensive income or loss, including net income and other comprehensive income items | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Net (loss) income | (26,125) | 33,597 | (59,722) | -177.79% | | Total other comprehensive loss | — | (595) | 595 | -100.00% | | Comprehensive (loss) income | (26,125) | 33,002 | (59,127) | -179.16% | | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Net (loss) income | (4,633) | 50,670 | (55,303) | -109.14% | | Total other comprehensive loss | (502) | (143) | (359) | 251.05% | | Comprehensive (loss) income | (5,135) | 50,527 | (55,662) | -110.16% | - The company shifted from **comprehensive income** in 2024 to a **comprehensive loss** in 2025, mirroring the **net loss** reported, with a minor impact from unrealized loss on derivative interest rate swaps[20](index=20&type=chunk) [Consolidated Statements of Stockholders' Deficit (Unaudited)](index=11&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Deficit%20(Unaudited)) These statements outline changes in stockholders' deficit, reflecting the impact of the deconsolidation and spin-off | Metric | December 31, 2024 ($ in thousands) | June 30, 2025 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------------------- | :------------------------------- | :----------------------------- | :---------------------- | :--------- | | Total stockholders' deficit | (143,446) | (106,376) | 37,070 | 25.84% | | Additional paid-in-capital | 361,379 | 213,533 | (147,846) | -40.91% | | Accumulated deficit | (507,378) | (319,713) | 187,665 | 36.99% | - The **deconsolidation of CompoSecure Holdings, L.L.C.** resulted in a **decrease of additional paid-in capital by $(138,443) thousand** and an **increase in accumulated deficit by $188,898 thousand** as of March 31, 2025[22](index=22&type=chunk) - The **spin-off of Resolute Holdings** led to a **decrease of additional paid-in capital by $(14,209) thousand** and an **increase in accumulated deficit by $3,400 thousand** as of March 31, 2025[22](index=22&type=chunk) [Consolidated Statements of Cash Flows (Unaudited)](index=13&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) These statements detail the company's cash inflows and outflows from operating, investing, and financing activities | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Net cash provided by operating activities | 3,048 | 66,000 | (62,952) | -95.38% | | Net cash used in investing activities | (60,690) | (3,520) | (57,170) | 1624.15% | | Net cash used in financing activities | (15,011) | (68,290) | 53,279 | -77.99% | | Net decrease in cash and cash equivalents | (72,653) | (5,820) | (66,843) | 1148.51% | | Cash and cash equivalents, end of period | 4,808 | 35,390 | (30,582) | -86.41% | - **Cash used in investing activities increased substantially** due to the **deconsolidation of Holdings cash ($50,303 thousand)** and **Resolute Holdings cash ($10,000 thousand)** as a result of the **Spin-Off** and **Management Agreement**[25](index=25&type=chunk) - **Net cash provided by operating activities decreased significantly**, primarily due to **lower net income**, non-cash charges, and the **equity in net income of Holdings**, partially offset by distributions from Holdings and changes in mark-to-market fair values[200](index=200&type=chunk) [Notes to Consolidated Financial Statements (Unaudited)](index=14&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(Unaudited)) These notes provide detailed explanations and disclosures supporting the consolidated financial statements [1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS](index=14&type=section&id=1.%20DESCRIPTION%20OF%20ORGANIZATION%20AND%20BUSINESS%20OPERATIONS) This note describes CompoSecure's business, recent corporate transactions, and the spin-off of Resolute Holdings - CompoSecure, Inc. manufactures and designs complex metal, composite, and proprietary financial transaction cards, and provides Arculus secure authentication and digital asset storage capabilities[26](index=26&type=chunk) - The company eliminated its dual-share class structure through the Tungsten Transactions on **September 17, 2024**, making Tungsten the majority owner with approximately **60% voting interest**[29](index=29&type=chunk) - On **February 28, 2025**, CompoSecure completed the **spin-off of Resolute Holdings** Following this, Holdings is no longer consolidated and is accounted for under the **equity method** due to a **Management Agreement** with Resolute Holdings[30](index=30&type=chunk)[33](index=33&type=chunk) - The **spin-off** resulted in an adjustment to the **warrant exercise price**, decreasing it from **$11.50 to $7.97 per share**, and the **redemption trigger price from $18.00 to $14.47 per share**[32](index=32&type=chunk) [2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=15&type=section&id=2.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the key accounting principles and policies applied in preparing the financial statements, including the new equity method for Holdings - The financial statements are prepared in conformity with U.S. GAAP and SEC rules, with all intercompany accounts and transactions eliminated[34](index=34&type=chunk) - Effective **February 28, 2025**, Holdings is accounted for under the **equity method** because it is now considered a Variable Interest Entity (VIE) for which CompoSecure is not the primary beneficiary, following the **Spin-Off** and **Management Agreement**[41](index=41&type=chunk) - **Revenue** is recognized when performance obligations are satisfied, typically upon transfer of control of goods to customers, and is measured net of variable consideration such as discounts and rebates[45](index=45&type=chunk)[48](index=48&type=chunk) - The Company is assessing the impact of ASU 2025-03 (determining accounting acquirer in VIE acquisition) and ASU 2024-03 (disaggregation of income statement expenses) ASU 2023-09 (income tax disclosures) was adopted on **January 1, 2025**, without material impact[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) [3. INVENTORIES](index=19&type=section&id=3.%20INVENTORIES) This note details the company's inventory composition and the impact of deconsolidation on its reporting | Inventory Class | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :---------------- | :----------------------------- | :------------------------------- | | Raw materials | — | 46,109 | | Work in process | — | 1,024 | | Finished goods | — | 505 | | Inventory reserve | — | (2,805) | | **Total** | **—** | **44,833** | - CompoSecure, Inc. no longer reports **inventories** on its consolidated balance sheet as of **June 30, 2025**, due to the change to **equity method accounting for Holdings**[59](index=59&type=chunk) [4. PROPERTY AND EQUIPMENT](index=19&type=section&id=4.%20PROPERTY%20AND%20EQUIPMENT) This note provides information on the company's property and equipment, net, and the effect of equity method accounting | Asset Class | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :------------------------------ | :----------------------------- | :------------------------------- | | Total gross property and equipment | — | 54,272 | | Less: Accumulated depreciation and amortization | — | (30,824) | | **Property and equipment, net** | **—** | **23,448** | - CompoSecure, Inc. no longer reports **property and equipment** on its consolidated balance sheet as of **June 30, 2025**, due to the adoption of **equity method accounting for Holdings**[60](index=60&type=chunk) [5. EQUITY METHOD INVESTMENT](index=19&type=section&id=5.%20EQUITY%20METHOD%20INVESTMENT) This note explains the company's investment in Holdings, accounted for under the equity method, and its financial performance - CompoSecure's **100% ownership in Holdings** is accounted for as an **equity method investment**, with a carrying value of **$44,739 thousand** as of **June 30, 2025**[61](index=61&type=chunk)[62](index=62&type=chunk) - The initial carrying value was **$0**, as Holdings waived collection of advances made to CompoSecure prior to deconsolidation[61](index=61&type=chunk) | Holdings Financials | Three Months Ended June 30, 2025 ($ in thousands) | Period from Feb 28, 2025 through June 30, 2025 ($ in thousands) | | :-------------------------- | :------------------------------------------ | :---------------------------------------------------------- | | Net sales | 119,592 | 163,657 | | Gross profit | 68,800 | 94,599 | | Income from operations | 41,018 | 56,740 | | Net income | 38,909 | 53,753 | | Holdings Financial Position | June 30, 2025 ($ in thousands) | | :-------------------------- | :----------------------------- | | Total assets | 243,432 | | Total liabilities | 248,836 | | Total members' deficit | (5,404) | [6. DEBT](index=21&type=section&id=6.%20DEBT) This note details the company's and Holdings' debt obligations, including credit facilities and interest rate swaps - All **$130,000 thousand of Exchangeable Notes** were surrendered and exchanged for **13,587,565 shares of Class A Common Stock** prior to **November 29, 2024**[66](index=66&type=chunk) - Holdings refinanced its credit facility on **August 7, 2024**, establishing a **$330,000 thousand 2024 Credit Facility**, comprising a **$200,000 thousand term loan** and a **$130,000 thousand revolving credit facility**, maturing on **August 7, 2029**[70](index=70&type=chunk) | Debt Balance (CompoSecure) | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :------------------------- | :----------------------------- | :------------------------------- | | Term loan balance | — | 197,500 | | Total long term debt | — | 184,389 | - Holdings was in compliance with all financial covenants (minimum interest coverage ratio, maximum total debt to EBITDA ratio, minimum fixed charge coverage ratio) as of **June 30, 2025**, and **December 31, 2024**[76](index=76&type=chunk) - Holdings has a **$125,000 thousand notional interest rate swap** (December 2023 Swap) designated as a **cash flow hedge**, set to expire in **December 2025**[78](index=78&type=chunk) [7. EQUITY STRUCTURE](index=24&type=section&id=7.%20EQUITY%20STRUCTURE) This note describes the company's equity structure, including common stock, warrants, and the impact of the spin-off - In **May 2025**, the Company increased its authorized **Class A Common Stock to 1,000,000,000 shares** and eliminated Class B Common Stock[80](index=80&type=chunk)[81](index=81&type=chunk) - As of **June 30, 2025**, there were **102,357,732 shares of Class A Common Stock** issued and outstanding[81](index=81&type=chunk) - The **warrant exercise price** was adjusted from **$11.50 to $7.97 per share**, and the **redemption trigger price from $18.00 to $14.47 per share**, effective **February 28, 2025**, due to the **spin-off of Resolute Holdings**[84](index=84&type=chunk) - As of **June 30, 2025**, there were **21,989,079 warrants outstanding**[84](index=84&type=chunk) - The Company no longer has a **non-controlling interest** as of **June 30, 2025**, and **December 31, 2024**, following the exchange of all Class B shares for Class A shares in the Tungsten Transactions[87](index=87&type=chunk) [8. EQUITY COMPENSATION](index=25&type=section&id=8.%20EQUITY%20COMPENSATION) This note outlines the company's stock-based compensation plans and related expenses | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Total stock-based compensation expense | 137 | 5,238 | (5,101) | -97.38% | | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Total stock-based compensation expense | 3,987 | 9,635 | (5,648) | -58.62% | - The **decrease in stock-based compensation expense** is primarily due to expenses related to Holdings and Resolute Holdings employees now being recognized at those entities post-Spin-Off[88](index=88&type=chunk) - Outstanding PSUs, RSUs, and stock options were adjusted due to the **Spin-Off** to maintain equal value for award holders, with no incremental compensation cost recognized[90](index=90&type=chunk) - The second phase of Earnouts (up to **3,750,000 shares**) will be earned if Class A Common Stock trades at or above **$17.10 per share** (adjusted from **$20.00**) for **20 trading days** within a **30-day period** ending **December 30, 2025**[96](index=96&type=chunk) [9. RETIREMENT PLAN](index=28&type=section&id=9.%20RETIREMENT%20PLAN) This note provides details on the company's retirement plan and associated expenses | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Retirement plan expense | — | 461 | (461) | -100.00% | | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Retirement plan expense | 563 | 1,052 | (489) | -46.48% | - Effective **January 1, 2025**, the Company increased its **401(k) matching contribution to 100% of the first 3%** and **50% of the next 2%** of employee contributions[98](index=98&type=chunk) [10. FAIR VALUE MEASUREMENTS](index=28&type=section&id=10.%20FAIR%20VALUE%20MEASUREMENTS) This note discusses the valuation of financial instruments, including warrants and earnout consideration | Liability | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :-------------------- | :----------------------------- | :------------------------------- | | Warrants | 137,440 | 104,231 | | Earnout consideration | 20,024 | 20,533 | - The derivative asset for interest rate swaps is no longer reflected on CompoSecure's balance sheet as of **June 30, 2025**, due to the **deconsolidation of Holdings**[100](index=100&type=chunk)[101](index=101&type=chunk) - The **warrant liability** was revalued, resulting in a **$35,515 thousand expense** for the six months ended **June 30, 2025**[103](index=103&type=chunk) - The **earnout consideration liability** was revalued, resulting in a **$(509) thousand income** for the six months ended **June 30, 2025**[105](index=105&type=chunk) **Key Assumptions for Earnout Consideration Valuation (June 30, 2025):** | Assumption | Value | | :---------------------- | :------ | | Valuation date share price | $14.09 | | Risk-free interest rate | 4.29 % | | Expected volatility | 42.5 % | | Expected dividends | 0 % | | Expected term (years) | 0.49 years | [11. GEOGRAPHIC INFORMATION AND CONCENTRATIONS](index=30&type=section&id=11.%20GEOGRAPHIC%20INFORMATION%20AND%20CONCENTRATIONS) This note provides insights into the company's net sales by region and customer/vendor concentrations | Net Sales by Region | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Domestic | — | 85,184 | (85,184) | -100.00% | | International | — | 23,383 | (23,383) | -100.00% | | **Total** | **—** | **108,567** | **(108,567)** | **-100.00%** | | Net Sales by Region | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Domestic | 54,480 | 177,974 | (123,494) | -69.39% | | International | 5,344 | 34,603 | (29,259) | -84.56% | | **Total** | **59,824** | **212,577** | **(152,753)** | **-71.86%** | - Holdings generated **$119,592 thousand of net sales** for the three months ended **June 30, 2025**, with **$104,300 thousand from domestic sales** and **$15,300 thousand from international sales**[160](index=160&type=chunk)[162](index=162&type=chunk)[163](index=163&type=chunk) - Four customers individually accounted for more than **10% of the Company's revenue**, totaling **70.0% of total revenue** for the six months ended **June 30, 2025**[107](index=107&type=chunk) - Three individual vendors accounted for more than **10% of purchases of supplies**, totaling approximately **31% of total purchases** for the six months ended **June 30, 2025**[108](index=108&type=chunk) [12. INCOME TAXES](index=31&type=section&id=12.%20INCOME%20TAXES) This note details the company's income tax provisions, effective tax rates, and the impact of the spin-off | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Income tax benefit (expense) | 1,762 | (258) | 2,020 | -782.95% | | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Income tax (expense) benefit | (25,242) | 578 | (25,820) | -4467.13% | - The **significant increase in income tax expense** for the six months ended **June 30, 2025**, was primarily related to a **taxable gain on appreciated property** resulting from the **Spin-Off**[113](index=113&type=chunk)[179](index=179&type=chunk) - The Company's estimated annual effective tax rate, before discrete items, was **32.4%** for the six months ended **June 30, 2025**, with discrete items impacting it by **67.0%**[111](index=111&type=chunk) [13. NET (LOSS) EARNINGS PER SHARE](index=31&type=section&id=13.%20NET%20(LOSS)%20EARNINGS%20PER%20SHARE) This note presents the calculation of basic and diluted net earnings per share, reflecting the recent accounting changes | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----- | | Net (loss) income per share—basic | $(0.26) | $0.44 | $(0.70) | | Net (loss) income per share—diluted | $(0.26) | $0.32 | $(0.58) | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----- | | Net (loss) income per share—basic | $(0.05) | $0.74 | $(0.79) | | Net (loss) income per share—diluted | $(0.05) | $0.49 | $(0.54) | - The shift to **net loss per share** is primarily due to the **deconsolidation of Holdings** and related accounting changes[19](index=19&type=chunk)[116](index=116&type=chunk) - Potentially dilutive securities, including **21,989,079 warrants**, **4,386,097 earnout consideration shares**, and **1,936,232 equity awards**, were excluded from diluted EPS calculation for the six months ended **June 30, 2025**, due to their anti-dilutive effect[117](index=117&type=chunk) [14. COMMITMENTS AND CONTINGENCIES](index=32&type=section&id=14.%20COMMITMENTS%20AND%20CONTINGENCIES) This note outlines the company's contractual obligations, including the Tax Receivable Agreement, and legal proceedings **Tax Receivable Agreement (TRA) Expected Payments:** | Year | Amount ($ in thousands) | | :------------------------------------------ | :---------------------- | | 2025 (excluding H1 2025) | 436 | | 2026 | 14,122 | | 2027 | 14,283 | | 2028 | 14,516 | | 2029 | 14,762 | | Later years | 190,851 | | **Total Payments** | **248,970** | - The Company made a **$4,735 thousand payment** related to the **tax receivable agreement liability** during the six months ended **June 30, 2025**[120](index=120&type=chunk) - As of **August 4, 2025**, the Company was not a party to any material pending legal proceedings, other than ordinary routine claims incidental to the business[216](index=216&type=chunk) [15. SEGMENT REPORTING](index=33&type=section&id=15.%20SEGMENT%20REPORTING) This note describes the company's operating and reportable segments, focusing on the equity method investment in Holdings - Subsequent to the **Spin-Off**, CompoSecure, Inc. has one operating segment and one reportable segment: the **equity method investment in Holdings**[124](index=124&type=chunk) - The Company's corporate entity is not considered an operating segment as its operations do not generate revenues and are limited to fair value adjustments related to warrant and earnout liabilities[125](index=125&type=chunk) - The Chief Operating Decision Maker (CODM), the CEO, evaluates Holdings' performance primarily based on **net sales**, **gross profit**, and **net (loss) income**[126](index=126&type=chunk) **Holdings' Results of Operations (Six Months Ended June 30, 2025):** | Metric | Amount ($ in thousands) | | :-------------------------- | :---------------------- | | Net sales | 163,657 | | Gross profit | 94,599 | | Income from operations | 56,740 | | Net income | 53,753 | [16. RELATED PARTY TRANSACTIONS](index=36&type=section&id=16.%20RELATED%20PARTY%20TRANSACTIONS) This note details transactions and agreements with related parties, including Resolute Holdings - Following the **Spin-Off**, CompoSecure and Resolute Holdings are under common control by Tungsten[129](index=129&type=chunk) - Under the **Management Agreement**, Holdings pays Resolute Holdings a quarterly **management fee** equal to **2.5% of Holdings' last twelve months' Adjusted EBITDA**[130](index=130&type=chunk) - The **Management Fee** for the three months ended **June 30, 2025**, was **$3,419 thousand**, and **$4,548 thousand** for the period from the **Spin-Off date to June 30, 2025**[131](index=131&type=chunk) - CompoSecure's primary sources of liquidity are its existing **cash and cash equivalents balances** and funding (distributions) from its wholly-owned subsidiary, Holdings[136](index=136&type=chunk) [17. SUBSEQUENT EVENT](index=37&type=section&id=17.%20SUBSEQUENT%20EVENT) This note discloses significant events occurring after the balance sheet date, such as new tax legislation - On **July 4, 2025**, the 'One Big, Beautiful Bill Act' was signed into law, permanently extending certain expiring provisions of the Tax Cuts and Jobs Act and restoring favorable tax treatment for some business provisions[138](index=138&type=chunk) - The Company is currently evaluating the potential effects of this new legislation on its tax positions and financial reporting[138](index=138&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on CompoSecure, Inc.'s financial condition and results of operations, highlighting the significant impact of the spin-off of Resolute Holdings and the subsequent equity method accounting for Holdings It details the company's business overview, recent developments, economic conditions, key components of results, and a comparative analysis of financial performance for the three and six months ended June 30, 2025, versus 2024, along with discussions on liquidity and capital resources [Overview](index=39&type=section&id=Overview) This section provides a general overview of CompoSecure's business, its market position, and customer base - CompoSecure, Inc., through its subsidiary Holdings, creates innovative, highly differentiated, and customized financial payment card products and provides next-generation payment technology, security, and authentication solutions[140](index=140&type=chunk) - The Company's customers primarily consist of leading international and domestic banks and other payment card issuers in the U.S., Europe, Asia, Latin America, Canada, and the Middle East[140](index=140&type=chunk) - CompoSecure has established a niche position in the financial payment card market with over **20 years of innovation** and experience[140](index=140&type=chunk) [Recent Developments](index=39&type=section&id=Recent%20Developments) This section highlights key recent events, including the spin-off of Resolute Holdings and its accounting implications - On **February 28, 2025**, CompoSecure completed the **spin-off of Resolute Holdings**, distributing its common stock pro rata to CompoSecure Class A Common Stockholders[141](index=141&type=chunk) - In connection with the **Spin-Off**, Holdings entered into a **Management Agreement** with Resolute Holdings, under which Resolute Holdings provides management services in exchange for quarterly **management fees** based on **2.5% of Holdings' Adjusted EBITDA**[141](index=141&type=chunk) - Following the **Spin-Off** and **Management Agreement**, CompoSecure no longer consolidates Holdings and now accounts for its investment in Holdings using the **equity method**[144](index=144&type=chunk) - The **Spin-Off** resulted in an adjustment to the **warrant price**, decreasing it from **$11.50 to $7.97 per share**, and the **redemption trigger price from $18.00 to $14.47 per share**[142](index=142&type=chunk)[143](index=143&type=chunk) [Economic Conditions - globally and in the digital asset marketplace](index=40&type=section&id=Economic%20Conditions%20-%20globally%20and%20in%20the%20digital%20asset%20marketplace) This section discusses the global economic environment and its potential impact on the company's operations and the digital asset market - The Company operates in uncertain and volatile global economic conditions, including geopolitical conflicts (Ukraine, Israel-Gaza), sustained inflation, recession concerns, and supply chain disruptions, making future business activity forecasting difficult[145](index=145&type=chunk) - Potential for further U.S. tariffs or other trade restrictions, particularly with China, could **increase raw material costs** and **materially adversely affect** the Company's business, financial condition, and results of operations[146](index=146&type=chunk) - The rapidly evolving digital assets industry presents uncertainty for the anticipated ramp-up of the **Arculus technology**, leading the Company to take a measured approach to investments[147](index=147&type=chunk) [Key Components of Results of Operations](index=40&type=section&id=Key%20Components%20of%20Results%20of%20Operations) This section explains the primary drivers and components of the company's financial performance post-Spin-Off - Post-Spin-Off, CompoSecure's operations are limited to non-revenue generating activities such as stock market listing, public company compliance, **tax receivable agreement obligations**, and **earnout consideration**[149](index=149&type=chunk) - **Net sales** are primarily generated from the design and manufacturing of metal cards and Prelams, recognized net of discounts and allowances[150](index=150&type=chunk) - **Cost of sales** includes direct and indirect manufacturing costs, raw materials, labor, equipment, facilities, operational overhead, depreciation, amortization, and shipping[151](index=151&type=chunk) - **Earnings in Holdings Equity Method Investment** represents the **net income of Holdings** attributable to the Company, following the shift to **equity method accounting**[156](index=156&type=chunk) [Factors Affecting the Company's Operating Results](index=42&type=section&id=Factors%20Affecting%20the%20Company's%20Operating%20Results) This section outlines various internal and external factors that influence the company's operating performance and future success - The Company's performance and future success are dependent on various factors, including those discussed in the 'Risk Factors' and 'Cautionary Note Regarding Forward-Looking Statements' sections of this report[158](index=158&type=chunk) [Results of Operations](index=43&type=section&id=Results%20of%20Operations) This section provides a comparative analysis of the company's financial performance for the reported periods [Three Months Ended June 30, 2025 compared with Three Months Ended June 30, 2024](index=43&type=section&id=Three%20Months%20Ended%20June%2030,%202025%20compared%20with%20Three%20Months%20Ended%20June%2030,%202024) This section compares the company's financial results for the three months ended June 30, 2025, against the prior year period | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Net sales | — | 108,567 | (108,567) | -100.00% | | Gross profit | — | 56,072 | (56,072) | -100.00% | | Operating expenses | 2,656 | 24,279 | (21,623) | -89.06% | | Net (loss) income attributable to CompoSecure, Inc. | (26,125) | 11,099 | (37,224) | -335.38% | | Earnings in equity method investment | 38,909 | — | 38,909 | N/A | - **Net sales** and **gross profit decreased by 100% to $0** for Q2 2025, primarily due to the **deconsolidation of Holdings** on **February 28, 2025**[159](index=159&type=chunk)[160](index=160&type=chunk)[164](index=164&type=chunk) - **Other income (expense), net**, shifted from **$2.1 million income** in Q2 2024 to **$(64.1) million expense** in Q2 2025, mainly driven by a **$(53.4) million revaluation of warrant liability**[159](index=159&type=chunk)[167](index=167&type=chunk) - Holdings generated **$119.6 million of net sales** and **$68.8 million of gross profit** for the three months ended **June 30, 2025**[160](index=160&type=chunk)[164](index=164&type=chunk) [Six Months Ended June 30, 2025 compared with Six Months Ended June 30, 2024](index=46&type=section&id=Six%20Months%20Ended%20June%2030,%202025%20compared%20with%20Six%20Months%20Ended%20June%2030,%202024) This section compares the company's financial results for the six months ended June 30, 2025, against the prior year period | Metric | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | Change ($ in thousands) | Change (%) | | :------------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :---------------------- | :--------- | | Net sales | 59,824 | 212,577 | (152,753) | -71.86% | | Gross profit | 28,749 | 111,285 | (82,536) | -74.17% | | Operating expenses | 25,361 | 48,357 | (22,996) | -47.55% | | Net (loss) income attributable to CompoSecure, Inc. | (4,633) | 17,041 | (21,674) | -127.19% | | Earnings in equity method investment | 53,753 | — | 53,753 | N/A | - **Net sales decreased by $152.8 million (72%)** and **gross profit decreased by $82.5 million (74%)** for H1 2025, primarily due to the **deconsolidation of Holdings**[170](index=170&type=chunk)[171](index=171&type=chunk)[174](index=174&type=chunk) - **Income tax expense increased significantly** from a benefit of **$0.6 million** in H1 2024 to an expense of **$25.2 million** in H1 2025, primarily due to a **taxable gain on appreciated property** resulting from the **Spin-Off**[170](index=170&type=chunk)[179](index=179&type=chunk) - **Other expense, net**, increased from **$(12.8) million** in H1 2024 to **$(36.5) million** in H1 2025, mainly due to a **$(35.5) million revaluation of warrant liability**[170](index=170&type=chunk)[177](index=177&type=chunk) [Critical Accounting Policies and Estimates](index=53&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section discusses the accounting policies and estimates that require significant judgment and could materially affect financial results - Critical accounting policies are detailed in the Company's Annual Report on Form 10-K for the year ended **December 31, 2024**[194](index=194&type=chunk) - A new critical accounting policy is the **equity method of accounting for Holdings**, adopted effective **February 28, 2025**, as Holdings is now a Variable Interest Entity (VIE) for which CompoSecure is not the primary beneficiary[195](index=195&type=chunk) [Recently Adopted Accounting Policies](index=53&type=section&id=Recently%20Adopted%20Accounting%20Policies) This section provides information on new accounting pronouncements adopted by the company - Information concerning recent accounting pronouncements adopted since the filing of the Company's Annual Report on Form 10-K for the year ended **December 31, 2024**, is provided in Note 2 of the Notes to Financial Statements[196](index=196&type=chunk) [Liquidity and Capital Resources](index=54&type=section&id=Liquidity%20and%20Capital%20Resources) This section analyzes the company's ability to generate and manage cash, including its sources of liquidity and capital - CompoSecure, Inc.'s primary liquidity sources are its existing **cash and cash equivalents** and funding (distributions) from its wholly-owned subsidiary, Holdings[197](index=197&type=chunk) - Holdings' primary liquidity sources are its existing **cash and cash equivalents**, **cash flows from operations**, and borrowings on its term loan and revolving credit facility[197](index=197&type=chunk) | Metric | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :-------------------------------- | :----------------------------- | :------------------------------- | | CompoSecure Cash & Equivalents | 4,808 | 77,461 | | Holdings Cash & Equivalents | 91,700 | N/A | | Holdings Total Debt Principal | 192,500 | 197,500 | - The Company believes Holdings' **cash flows from operations**, available **cash ($91.7 million)**, and available **$130.0 million** under the 2024 Revolver are sufficient to meet liquidity needs for at least the next **12 months**[199](index=199&type=chunk) [Net Cash Provided by Operations](index=54&type=section&id=Net%20Cash%20Provided%20by%20Operations) This section details the cash generated or used by the company's core business activities - **Net cash provided by CompoSecure's operating activities decreased by $63.0 million**, from **$66.0 million** for the six months ended **June 30, 2024**, to **$3.0 million** for the six months ended **June 30, 2025**[200](index=200&type=chunk) - The decrease was primarily attributable to decreases in **net income ($55.3 million)**, non-cash charges (**$10.0 million**), and **equity in net income of Holdings ($53.8 million)**, partially offset by a **$15.9 million distribution from Holdings** and **$33.6 million in changes in mark-to-market fair values**[200](index=200&type=chunk) [Net Cash Used in Investing](index=54&type=section&id=Net%20Cash%20Used%20in%20Investing) This section outlines the cash flows related to the company's investment activities, including asset acquisitions and divestitures - **Cash used in CompoSecure's investing activities increased substantially to $60.7 million** for the six months ended **June 30, 2025**, compared to **$3.5 million** in the prior year[201](index=201&type=chunk) - This increase was primarily related to **$50.3 million of Holdings cash** and **$10.0 million of Resolute Holdings cash** deconsolidated as a result of the **Spin-Off** and **Management Agreement**[25](index=25&type=chunk)[201](index=201&type=chunk) [Net Cash Used in Financing](index=54&type=section&id=Net%20Cash%20Used%20in%20Financing) This section describes the cash flows associated with the company's financing activities, such as debt and equity transactions - **Cash used in CompoSecure's financing activities decreased to $15.0 million** for the six months ended **June 30, 2025**, from **$68.3 million** in the prior year[202](index=202&type=chunk) - For H1 2025, **cash used primarily related to $15.3 million in payments for taxes** related to net share settlement of equity awards and **$4.7 million for tax receivable agreement liability payments**, partially offset by **$4.9 million from warrant exercises**[202](index=202&type=chunk)[203](index=203&type=chunk) - For H1 2024, **cash used included $26.2 million in distributions to non-controlling interest holders**, **$15.6 million in special distributions**, **$9.4 million in term loan payments**, and **$8.9 million in dividends to Class A shareholders**[203](index=203&type=chunk) [Contractual Obligations](index=55&type=section&id=Contractual%20Obligations) This section summarizes the company's material outstanding contractual commitments and payment obligations - A summary of Holdings' material outstanding contractual commitments, including long-term contractual obligations and estimated purchase obligations, is included in the Company's Annual Report on Form 10-K for the year ended **December 31, 2024**[204](index=204&type=chunk) - CompoSecure, Inc. itself did not have any material contractual obligations[204](index=204&type=chunk) [Financing](index=55&type=section&id=Financing) This section provides details on the company's financing arrangements, including credit facilities - Holdings is party to the **2024 Credit Facility** with various banks, with more information available in Note 6 to the Company's financial statements and its Annual Report on Form 10-K for the fiscal year ended **December 31, 2024**[205](index=205&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the Company's exposure to market risks, primarily focusing on interest rate risk related to Holdings' variable rate debt Holdings uses an interest rate swap to hedge against fluctuations [Interest Rate Risk](index=55&type=section&id=Interest%20Rate%20Risk) This section assesses the company's exposure to fluctuations in interest rates, particularly on its variable-rate debt - Holdings is exposed to **interest rate risk** on its **variable rate debt obligations**, with **$192.5 million in debt** outstanding under the **2024 Credit Facility** as of **June 30, 2025**[206](index=206&type=chunk) - A sensitivity analysis indicates that a **100 basis point increase or decrease** in the applicable interest rate would cause an approximate **$1.9 million increase or decrease** in annual interest expense[207](index=207&type=chunk) - Holdings uses an **interest rate swap agreement** (December 2023 Swap) with a notional amount of **$125,000 thousand**, designated as a **cash flow hedge**, to manage **interest rate risk**[208](index=208&type=chunk)[209](index=209&type=chunk) [Item 4. Controls and Procedures](index=56&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of CompoSecure's disclosure controls and procedures, concluding their effectiveness as of June 30, 2025 It also confirms no material changes in internal control over financial reporting during the quarter [Evaluation of Disclosure Controls and Procedures](index=56&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section describes management's assessment of the effectiveness of the company's disclosure controls and procedures - As of **June 30, 2025**, management, including the principal executive and financial officers, concluded that disclosure controls and procedures were functioning effectively to provide reasonable assurance for timely and accurate reporting[212](index=212&type=chunk) - The Company acknowledges that no control system can provide absolute assurance that all objectives are met or that all control issues and instances of fraud are detected[213](index=213&type=chunk) [Changes in Internal Control Over Financial Reporting](index=56&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) This section reports on any material changes in the company's internal control over financial reporting during the quarter - There have been no changes in the Company's internal control over financial reporting during the quarter ended **June 30, 2025**, that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting[214](index=214&type=chunk) [Part II. Other Information](index=57&type=section&id=Part%20II.%20Other%20Information) This section covers other information, including legal proceedings, risk factors, and equity security details [Item 1. Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) This section states that CompoSecure, Inc. was not involved in any material legal proceedings as of August 4, 2025 - As of **August 4, 2025**, the Company was not a party to, nor were any of its properties the subject of, any material pending legal proceedings, other than ordinary routine claims incidental to the business[216](index=216&type=chunk) [Item 1A. Risk Factors](index=57&type=section&id=Item%201A.%20Risk%20Factors) This comprehensive section outlines substantial risks associated with investing in CompoSecure's securities It categorizes risks related to the Company's business operations, the Tungsten Transaction, the Management Agreement with Resolute Holdings, the Company's indebtedness, and general risks related to the ownership of its securities, emphasizing potential adverse effects on business, financial condition, and results of operations [Summary of Risk Factors](index=57&type=section&id=Summary%20of%20Risk%20Factors) This section provides a concise overview of the substantial risks associated with investing in the company's securities - An investment in CompoSecure's securities involves **substantial risk**, with various factors potentially causing a **material adverse effect** on business, cash flows, financial condition, and results of operations[217](index=217&type=chunk)[218](index=218&type=chunk) - Key risk categories include those related to business operations (e.g., economic conditions, customer retention, data breaches, new products, digital assets), the Tungsten Transaction, the Management Agreement, indebtedness, and ownership of securities[217](index=217&type=chunk)[221](index=221&type=chunk) [Risks Related to Our Business](index=58&type=section&id=Risks%20Related%20to%20Our%20Business) This section details various risks that could materially affect the company's business operations and financial performance - **Rapidly evolving domestic and global economic conditions**, including geopolitical conflicts, inflation, and supply chain disruptions, are beyond the Company's control and could **materially adversely affect** its business[220](index=220&type=chunk) - The Company's **revenue growth rate may not be sustainable** due to factors like slowing demand, increased competition, or inability to engage and retain customers[222](index=222&type=chunk) - The Company relies heavily on two largest customers (JPMorgan Chase and American Express), which represented approximately **63%** and **71% of net sales** for 2024 and 2023, respectively, posing a risk if these relationships are adversely affected[223](index=223&type=chunk) - **Data and security breaches** could compromise systems and confidential information, causing reputational and financial damage, and increasing litigation risks[227](index=227&type=chunk)[230](index=230&type=chunk) - Future growth depends on the ability to develop, introduce, manufacture, and commercialize new products, which is a lengthy and complex process, especially for the **Arculus technology** in the rapidly evolving digital assets industry[234](index=234&type=chunk)[237](index=237&type=chunk)[241](index=241&type=chunk) - Regulatory uncertainty surrounding the digital asset environment, including potential classification of digital assets as securities, could restrict the use of the **Arculus Cold Storage Wallet**, impose significant costs, or lead to regulatory enforcement actions[245](index=245&type=chunk)[257](index=257&type=chunk)[261](index=261&type=chunk)[262](index=262&type=chunk) - Escalating U.S. tariffs or other trade restrictions on imported raw materials could drive up costs and **materially harm revenue, margins, and overall results of operations**[277](index=277&type=chunk) [Risks Related to the Resolute Holdings Management Agreement](index=69&type=section&id=Risks%20Related%20to%20Management%20Agreement) This section outlines risks arising from the management agreement with Resolute Holdings, including influence and potential conflicts - CompoSecure's business is managed by Resolute Holdings, which exercises **substantial influence** over its business, operations, and strategy, including establishing objectives, financing, management oversight, and M&A activities[282](index=282&type=chunk)[284](index=284&type=chunk) - The Company relies heavily on the skill and expertise of Resolute Holdings' management team, and the loss of key personnel could **adversely affect operations and profitability**[286](index=286&type=chunk) - The **Management Agreement** does not create a mutually exclusive relationship, meaning Resolute Holdings' resources are not fully dedicated to CompoSecure and may be diverted to other managed companies or new business activities[287](index=287&type=chunk) - The **Management Agreement** can be terminated, potentially requiring a **significant termination fee** payable by Holdings, which could **materially adversely affect financial results** or **dilute Class A Common Stockholders**[288](index=288&type=chunk) - Resolute Holdings maintains a contractual, not fiduciary, relationship with Holdings, has limited liability under the **Management Agreement**, and is indemnified for certain acts, meaning CompoSecure may experience poor performance or losses for which Resolute Holdings is not liable[289](index=289&type=chunk) - Potential **conflicts of interest** may arise with Resolute Holdings and its affiliates, as they may engage in other activities that conflict with CompoSecure's business[290](index=290&type=chunk) [Risks Related to the Tax Receivable Agreement](index=71&type=section&id=Risks%20Related%20to%20the%20Tax%20Receivable%20Agreement) This section discusses risks associated with the company's obligations under the Tax Receivable Agreement, including substantial payments - CompoSecure's only significant asset is its ownership interest in Holdings, and its ability to meet financial obligations, including those under the **Tax Receivable Agreement (TRA)**, depends on distributions from Holdings[292](index=292&type=chunk) - Payments under the **TRA** are expected to be **substantial**, representing **90% of the realized benefits** from additional tax depreciation or amortization deductions[294](index=294&type=chunk) - **TRA payments may be accelerated** in certain changes of control or early termination, potentially **significantly exceeding actual tax benefits** and impairing liquidity or change of control transactions[295](index=295&type=chunk)[298](index=298&type=chunk) [Risks Related to Indebtedness](index=73&type=section&id=Risks%20Related%20to%20Indebtedness) This section highlights risks stemming from Holdings' substantial debt, including limited flexibility and increased vulnerability - Holdings has **substantial indebtedness ($197.5 million as of December 31, 2024)**, which limits operating flexibility, increases vulnerability to adverse economic conditions, and requires a substantial portion of cash flow for debt servicing[300](index=300&type=chunk)[302](index=302&type=chunk) - The **debt outstanding** under Holdings' credit facility has a **variable interest rate based on SOFR**, which may increase borrowing costs and has unpredictable consequences[303](index=303&type=chunk) - An event of default in Holdings' credit facility could lead to acceleration of payments and foreclosure against the collateral, which includes substantially all of Holdings' assets[301](index=301&type=chunk) - The Holdings credit facility contains restrictive operating and financial covenants that may impair its ability to conduct business, raise additional financing, or take advantage of new business opportunities[304](index=304&type=chunk) [General Risks Related to Ownership of our Securities](index=74&type=section&id=General%20Risks%20Related%20to%20Ownership%20of%20our%20Securities) This section covers risks pertinent to owning the company's securities, such as stock price volatility and dilution - CompoSecure, Inc. has no direct operations and depends on its subsidiaries' profitability for debt repayment, public company expenses, and dividends[306](index=306&type=chunk) - Provisions in the Company's Charter and Delaware law may inhibit takeovers, potentially limiting the price investors are willing to pay for Class A Common Stock and entrenching management[307](index=307&type=chunk)[308](index=308&type=chunk)[309](index=309&type=chunk) - The Company incurs **significant costs as a public company**, which will increase after it ceases to be an 'emerging growth company' at the end of **2025**[310](index=310&type=chunk)[311](index=311&type=chunk) - The trading price of the Company's securities could be **volatile** and subject to wide fluctuations due to various factors, including financial results, competition, market expectations, and general economic conditions[319](index=319&type=chunk)[320](index=320&type=chunk) - **Warrants may not remain 'in the money'** and could expire worthless; their terms can be amended adversely to holders with majority approval; and they may be redeemed prior to exercise at a disadvantageous time[321](index=321&type=chunk)[323](index=323&type=chunk)[324](index=324&type=chunk) - The exercise of outstanding warrants (**21,989,079 shares as of June 30, 2025**) could increase the number of shares eligible for future resale and result in **dilution to stockholders**[325](index=325&type=chunk) - Tungsten's beneficial ownership of approximately **50.5% of Class A Common Stock** allows it to influence major corporate decisions, potentially leading to **conflicts of interest** with other stockholders[332](index=332&type=chunk)[333](index=333&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=81&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section confirms no unregistered sales of equity securities during the quarter and details the Company's share repurchase program, which had no activity in the quarter but retains $100.0 million in authorization [Unregistered Sales of Equity Securities](index=81&type=section&id=Unregistered%20Sales%20of%20Equity%20Securities) This section reports on any unregistered sales of equity securities during the period - There were no unregistered sales of equity securities during the quarter ended **June 30, 2025**[341](index=341&type=chunk) [Repurchases of Equity Securities](index=81&type=section&id=Repurchases%20of%20Equity%20Securities) This section details the company's share repurchase program and any activity during the quarter - The Board authorized a **repurchase program** in **March 2024** (increased to **$100.0 million** in **February 2025**) for Class A Common Stock or warrants, effective through **March 7, 2027**[342](index=342&type=chunk) - There was no repurchase activity during the quarter ended **June 30, 2025**[343](index=343&type=chunk) - As of **June 30, 2025**, **$100.0 million** of the repurchase authorization remained available under the program[343](index=343&type=chunk) [Item 3. Defaults Upon Senior Securities](index=82&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there were no defaults upon senior securities during the quarter ended June 30, 2025 - There were no defaults upon senior securities during the quarter ended **June 30, 2025**[344](index=344&type=chunk) [Item 4. Mine Safety Disclosures](index=82&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company - This item is not applicable to the Company[345](index=345&type=chunk) [Item 5. Other Information](index=82&type=section&id=Item%205.%20Other%20Information) This section discloses a Rule 10b5-1 trading plan entered into by an officer during the quarter and confirms no other such plans were adopted or terminated by directors or officers [Rule 10b5-1 Trading Plans](index=82&type=section&id=Rule%2010b5-1%20Trading%20Plans) This section discloses any Rule 10b5-1 trading plans adopted or terminated by directors or officers - On **June 12, 2025**, Adam Lowe, Chief Product & Innovation Officer, entered into a **Rule 10b5-1 trading plan** for the potential sale of **55,521 shares of Class A Common Stock**, scheduled to terminate by **June 30, 2026**[346](index=346&type=chunk) - No other directors or officers adopted or terminated **Rule 10b5-1** or non-Rule 10b5-1 trading arrangements during the quarter ended **June 30, 2025**[346](index=346&type=chunk) [Item 6. Exhibits](index=82&type=section&id=Item%206.%20Exhibits) This section provides a list of exhibits filed with the Form 10-Q, including amendments to corporate governance documents, equity incentive plans, various agreements, and certifications - Exhibits include the Third Amended and Restated Certificate of Incorporation, amendments to the 2021 Equity Incentive Plan, an Amended and Restated Waiver Agreement, a Transition and Consulting Agreement, the Fifth Amended and Restated Non-Employee Director Compensation Policy, and certifications from the CEO and CFO[347](index=347&type=chunk)[348](index=348&type=chunk) [SIGNATURES](index=84&type=section&id=SIGNATURES) This section contains the official signatures of the company's principal executive and financial officers - The report was signed on **August 7, 2025**, by Jonathan C. Wilk, President and Chief Executive Officer, and Timothy Fitzsimmons, Chief Financial Officer[352](index=352&type=chunk)

[Executive Summary](index=1&type=section&id=Executive%20Summary) CompoSecure achieved record Q2 2025 results, surpassing expectations with strong growth and improved profitability driven by its operating system [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%202025%20Highlights) CompoSecure achieved record Q2 2025 financial results, surpassing expectations with strong top-line growth and enhanced profitability from the CompoSecure Operating System - Operating results exceeded expectations across all **key metrics**[3](index=3&type=chunk) - **Strong top-line growth** driven by domestic programs from traditional banks and fintechs[3](index=3&type=chunk) - **Record profitability** demonstrates early results from CompoSecure Operating System[3](index=3&type=chunk) - **Raising previously issued full-year 2025 guidance**[3](index=3&type=chunk) [Management Commentary & Strategic Focus](index=1&type=section&id=Management%20Commentary%20%26%20Strategic%20Focus) CEO Jon Wilk highlighted accelerating sales, improved profitability, robust domestic demand, and growth across traditional banks and fintechs, with the Arculus platform achieving a net positive quarter and new customer launches - Strong second quarter driven by **accelerating sales and improved profitability**, fueled by robust domestic demand and growth across both traditional banks and fintechs[2](index=2&type=chunk) - Generated another **net positive quarter for Arculus**[2](index=2&type=chunk) - Saw exciting customer launches including Chase Sapphire Reserve, XP Legacy, Crypto.com, MGM Rewards, and Gemini[2](index=2&type=chunk) - The Arculus team announced the **new Coinbase One Card**, the first crypto card on the American Express network[2](index=2&type=chunk) - Anticipate sustained market demand as the company focuses on **accelerating growth, delivering innovation, and executing against strategic priorities**[2](index=2&type=chunk) - Focus on establishing **operational excellence through the CompoSecure Operating System (COS)** and building a high-performance culture is starting to deliver improved profitability[2](index=2&type=chunk) [2025 Financial Outlook](index=4&type=section&id=2025%20Financial%20Outlook) CompoSecure raised its full-year 2025 guidance, projecting Non-GAAP Net Sales of approximately $455 million and Pro Forma Adjusted EBITDA of approximately $158 million, reflecting strong commercial and operational momentum Updated Full-Year 2025 Financial Outlook | Metric | New Guidance | Prior Guidance | | :----------------------- | :------------- | :------------- | | Non-GAAP Net Sales | ~$455 million | Mid-single digit growth | | Pro Forma Adjusted EBITDA | ~$158 million | Mid-single digit growth | [Financial Performance](index=2&type=section&id=Financial%20Performance) Details CompoSecure's Q2 2025 financial results, covering accounting changes, Non-GAAP operating results, financial condition, and GAAP performance [Accounting Changes and Presentation](index=2&type=section&id=Accounting%20Changes%20and%20Presentation) Effective February 28, 2025, CompoSecure adopted equity method accounting for CompoSecure Holdings L.L.C. due to a spin-off, presenting Non-GAAP consolidated results for historical comparability - CompoSecure is required to account for CompoSecure Holdings L.L.C. under the **equity method**, effective February 28, 2025, due to the spin-off of Resolute Holdings Management, Inc[4](index=4&type=chunk) - **GAAP results for Q2 2025 reflect the conversion to equity method accounting**[5](index=5&type=chunk) - The Company is presenting full Q2 results on a **consolidated Non-GAAP basis** for clarity and comparability with historical presentation[5](index=5&type=chunk) [Q2 2025 Operating Results (Non-GAAP)](index=2&type=section&id=Q2%202025%20Operating%20Results%20(Non-GAAP)) CompoSecure reported a 10% increase in Non-GAAP Net Sales to $119.6 million, with Gross Profit rising to $68.8 million and gross margin expanding to 57.5% due to improved efficiencies and favorable product mix Q2 2025 Non-GAAP Operating Results (vs. Q2 2024) | Metric | Q2 2025 (Non-GAAP) | Q2 2024 (Non-GAAP) | Change (YoY) | | :-------------------------- | :----------------- | :----------------- | :----------- | | Net Sales ($ in millions) | $119.6 | $108.6 | +10% | | Gross Profit ($ in millions) | $68.8 | $56.1 | +22.6% | | Gross Margin (%) | 57.5% | 51.6% | +5.9 pp | | Pro-Forma Adjusted EBITDA ($ in millions) | $46.3 | $36.7 | +26.2% | | Adjusted EPS - Diluted | $0.25 | $0.23 | +8.7% | - **Non-GAAP Net Sales increased 10% to $119.6 million**, driven by strong domestic demand and growth across both traditional financial institutions and fintech partners[7](index=7&type=chunk) - **Gross margin expansion reflects improved manufacturing efficiencies** driven by the CompoSecure Operating System, along with favorable product mix[7](index=7&type=chunk) [Financial Condition (Non-GAAP)](index=3&type=section&id=Financial%20Condition%20(Non-GAAP)) As of June 30, 2025, CompoSecure's Non-GAAP financial condition showed $96.5 million in cash, $192.5 million in Total Debt, and a Net Debt leverage ratio of 0.66x, significantly improved from the prior year Non-GAAP Financial Condition (as of June 30) | Metric | June 30, 2025 (Non-GAAP) | June 30, 2024 (Non-GAAP) | Change | | :-------------------------- | :----------------------- | :----------------------- | :------- | | Cash and cash equivalents ($ in millions) | $96.5 | $35.4 | +$61.1M | | Total Debt ($ in millions) | $192.5 | $330.9 | -$138.4M | | Net Debt ($ in millions) | $96.0 | $295.5 | -$199.5M | | Net Debt leverage ratio | 0.66x | 2.15x | -1.49x | [GAAP Financial Performance](index=3&type=section&id=GAAP%20Financial%20Performance) CompoSecure reported a GAAP Net Loss of ($26.1) million in Q2 2025, primarily due to non-cash revaluation of warrant and earnout liabilities, resulting in a diluted EPS of $(0.26) Q2 2025 GAAP Financial Performance (vs. Q2 2024) | Metric | Q2 2025 (GAAP) | Q2 2024 (GAAP) | | :------------------------------------------ | :------------- | :------------- | | Net (Loss) Income ($ in millions) | $(26.1) | $33.6 | | Earnings Per Share - Diluted | $(0.26) | $0.32 | - The **net loss was driven by non-cash items** relating to the revaluation of warrant and earnout liabilities[11](index=11&type=chunk) [Company Overview & Innovation](index=4&type=section&id=Company%20Overview%20%26%20Innovation) Overview of CompoSecure's metal payment card and security solutions, highlighting product innovations and strategic partnerships [About CompoSecure](index=4&type=section&id=About%20CompoSecure) Founded in 2000, CompoSecure is a technology partner specializing in metal payment cards, security, and authentication solutions, aiming to deliver elegant, simple, and secure experiences - **Founded in 2000**, CompoSecure is a technology partner to market leaders, fintechs, and consumers[15](index=15&type=chunk) - Specializes in **metal payment cards, security, and authentication solutions**[1](index=1&type=chunk) - Combines elegance, simplicity, and security to deliver **exceptional experiences and peace of mind** in the physical and digital world[15](index=15&type=chunk) [Product and Partnership Highlights](index=4&type=section&id=Product%20and%20Partnership%20Highlights) CompoSecure's Arculus platform integrates security into payment card technology, highlighted by the Coinbase One Card launch with American Express, bridging Web3 and traditional finance, and four ICMA Élan Awards - **Arculus security and authentication capabilities** deliver unique, premium branded experiences[15](index=15&type=chunk) - Arculus partnered with Coinbase, Cardless, and American Express to launch **Coinbase One Card—the first crypto card on the American Express network**—aimed at bridging the gap between Web3 and traditional finance[16](index=16&type=chunk) - **Received four prestigious ICMA (International Card Manufacturers Association) Élan Awards**[16](index=16&type=chunk) [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) Explains the rationale for Non-GAAP measures, providing comparability, representing standalone business performance, and offering operational insights [Rationale for Non-GAAP Presentation](index=5&type=section&id=Rationale%20for%20Non-GAAP%20Presentation) Non-GAAP measures are presented to provide greater comparability to historical financial data and better represent standalone business performance following the spin-off and shift to equity method accounting - **Non-GAAP measures are presented** due to the spin-off of Resolute Holdings Management, Inc. and the resulting shift to equity method accounting under GAAP beginning February 28, 2025[18](index=18&type=chunk) - The presentation aims to provide investors with financial information that allows for **greater comparability with historical financial presentation** and better represents the underlying performance of the standalone business[18](index=18&type=chunk) - Non-GAAP measures provide **valuable insight into operational efficiency, ongoing profitability**, and a clearer view by excluding non-recurring and non-operational items[19](index=19&type=chunk) - These Non-GAAP measures are **used internally to establish forecasts, budgets, operational goals**, and evaluate historical performance[19](index=19&type=chunk) [Financial Statements & Reconciliations](index=8&type=section&id=Financial%20Statements%20%26%20Reconciliations) Presents detailed GAAP and Non-GAAP financial statements, including balance sheets, operations, cash flows, and EPS reconciliations for Q2 2025 [Balance Sheets](index=8&type=section&id=Balance%20Sheets) The balance sheets provide CompoSecure's financial position as of June 30, 2025, under GAAP and Non-GAAP frameworks, detailing cash, assets, liabilities, and shareholders' deficit Selected Balance Sheet Data (in thousands) | Metric | June 30, 2025 (GAAP) | June 30, 2025 (Non-GAAP) | Dec 31, 2024 (GAAP) | | :---------------------------------- | :------------------- | :--------------------- | :------------------ | | Cash and cash equivalents | $4,808 | $96,474 | $77,461 | | Total current assets | $5,905 | $214,205 | $173,902 | | Total assets | $317,296 | $515,989 | $473,918 | | Total current liabilities | $51,820 | $116,402 | $76,322 | | Long-term debt, net | — | $177,071 | $184,389 | | Total liabilities | $423,672 | $672,508 | $617,364 | | Shareholders' deficit | $(106,376) | $(156,519) | $(143,446) | [Statements of Operations](index=9&type=section&id=Statements%20of%20Operations) The statements of operations present GAAP and Non-GAAP results for Q2 2025, showing Non-GAAP Net Sales of $119.6 million and a GAAP net loss of $(26.1) million due to non-cash revaluation items Selected Statements of Operations Data (Three Months Ended June 30, in thousands) | Metric | Q2 2025 (GAAP) | Q2 2025 (Non-GAAP) | Q2 2024 (GAAP) | | :------------------------------------------ | :------------- | :----------------- | :------------- | | Net sales | $— | $119,592 | $108,567 | | Cost of sales | $— | $50,792 | $52,495 | | Gross profit | $— | $68,800 | $56,072 | | Selling, general and administrative expenses | $2,656 | $30,438 | $24,279 | | Revaluation of warrant liability | $(53,436) | $(53,436) | $5,604 | | Revaluation of earnout consideration liability | $(10,721) | $(10,721) | $1,928 | | Net (loss) income | $(26,125) | $(26,125) | $33,597 | | Pro Forma Adjusted EBITDA | | $46,322 | $36,705 | [Statements of Cash Flows](index=11&type=section&id=Statements%20of%20Cash%20Flows) The statements of cash flows detail cash movements for the six months ended June 30, 2025, showing Non-GAAP net cash provided by operating activities of $51.8 million and ending cash of $96.5 million Selected Statements of Cash Flows Data (Six Months Ended June 30, in thousands) | Metric | 2025 (GAAP) | 2025 (Non-GAAP) | 2024 (GAAP) | | :------------------------------------------ | :------------ | :-------------- | :------------ | | Net (loss) income | $(4,633) | $(4,633) | $50,670 | | Net cash provided by operating activities | $3,048 | $51,830 | $66,000 | | Net cash used in investing activities | $(60,690) | $(2,798) | $(3,527) | | Net cash used in financing activities | $(15,011) | $(30,019) | $(68,298) | | Net (decrease) increase in cash and cash equivalents | $(72,653) | $19,013 | $(5,825) | | Cash and cash equivalents, end of period | $4,808 | $96,474 | $35,391 | [Earnings Per Share Reconciliation](index=13&type=section&id=Earnings%20Per%20Share%20Reconciliation) This section reconciles GAAP net income to Adjusted Net Income and Adjusted EPS for Q2 2025, reporting a Non-GAAP Adjusted Net Income of $28.4 million and an Adjusted Diluted EPS of $0.25 Adjusted Net Income and EPS (Three Months Ended June 30, in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------------ | :------ | :------ | | Net (loss) income (GAAP) | $(26,125) | $33,597 | | Adjusted net income | $28,391 | $22,448 | | Adjusted net income per share - basic | $0.28 | $0.28 | | Adjusted net income per share - diluted | $0.25 | $0.23 | | Total Shares outstanding used in computing adjusted earnings per share Diluted | 114,894 | 104,735 | - **Adjustments include mark-to-market adjustments**, stock-based compensation, Proforma Management fees, Spin-off costs, and secondary offering transaction costs[28](index=28&type=chunk) [Additional Information](index=4&type=section&id=Additional%20Information) Provides Q2 2025 earnings call details, forward-looking statements with risks, and corporate and investor relations contact information [Earnings Conference Call Details](index=4&type=section&id=Earnings%20Conference%20Call%20Details) CompoSecure's Q2 2025 results will be discussed during a conference call on Thursday, August 7, 2025, at 5:00 p.m. Eastern Time, with a webcast available on the Investor Relations website - **Date: Thursday, August 7, 2025**[14](index=14&type=chunk) - **Time: 5:00 p.m. Eastern time**[14](index=14&type=chunk) - A **live webcast and replay** of the conference call will be available on the Investor Relations section of the Company's website at https://ir.composecure.com/news-events/events[13](index=13&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements based on management's beliefs, subject to inherent risks and uncertainties, and the company disclaims any obligation to update them except as required by law - Statements are based on the **beliefs and assumptions of management** and are inherently subject to risks, uncertainties, and assumptions[17](index=17&type=chunk) - **Factors that could affect future results** include the ability to grow and manage growth profitably, maintain customer relationships, competition, global economic factors, legal proceedings, future exchange and interest rates, and changes in accounting[17](index=17&type=chunk) - CompoSecure undertakes **no obligation to update or revise publicly any forward-looking statements**, whether as a result of new information, future events or otherwise, except as required by law[17](index=17&type=chunk) [Corporate and Investor Relations Contacts](index=7&type=section&id=Corporate%20and%20Investor%20Relations%20Contacts) Contact information for CompoSecure's Head of Communications, Anthony Piniella, and Investor Relations contact, Sean Mansouri of Elevate IR, is provided for inquiries - **Corporate Contact: Anthony Piniella**, Head of Communications, CompoSecure, (917) 208-7724, apiniella@composecure.com[20](index=20&type=chunk) - **Investor Relations Contact: Sean Mansouri**, CFA, Elevate IR, (720) 330-2829, CMPO@elevate-ir.com[20](index=20&type=chunk)

Core Insights - Resolute Holdings reported a second quarter loss per share of ($0.07) and Non-GAAP Fee-Related Earnings per share of $0.08 for the fiscal second quarter ending June 30, 2025 [1][4][5] - The CEO expressed satisfaction with the early results from the implementation of the operating system at CompoSecure and highlighted ongoing evaluations of acquisition opportunities [2][3] - The company is focused on improving operations and driving organic growth while committing to necessary investments for long-term potential [3] Financial Performance - Management fees for the three months ended June 30, 2025, were $3.419 million, while selling, general and administrative expenses were $3.804 million [4] - The net loss attributable to common stockholders for the six months ended June 30, 2025, was ($3.977 million), with a diluted net income per share of ($0.47) [4][17] - Fee-Related Earnings for the second quarter were $0.699 million, translating to Fee-Related Earnings per share of $0.08 [5][24] Operational Highlights - The company is implementing a Resolute Operating System aimed at enhancing value creation across managed businesses [10] - There is a commitment to evaluating a growing list of acquisition opportunities aligned with core investment criteria [3] - The financial results reflect the consolidation of CompoSecure Holdings in accordance with U.S. GAAP, which may not fully represent the standalone business model of Resolute Holdings [3][12] Balance Sheet Overview - As of June 30, 2025, total assets were reported at $253.291 million, an increase from $201.792 million as of December 31, 2024 [15][27] - Current liabilities totaled $63.876 million, with long-term debt net of deferred financing costs at $177.071 million [15][27] - The total stockholders' equity was $4.141 million, a significant improvement from a deficit of ($36.630 million) at the end of 2024 [15][27] Cash Flow Analysis - Net cash provided by operating activities for the six months ended June 30, 2025, was $67.288 million, compared to $71.760 million for the same period in 2024 [20] - Cash and cash equivalents at the end of the period were $99.862 million, up from $71.589 million at the beginning of the period [21] - The company reported net cash used in financing activities of ($36.217 million) for the six months ended June 30, 2025 [20]

Group 1 - CompoSecure, Inc. will host a conference call on August 7, 2025, at 5:00 p.m. EDT to discuss its financial results for Q2 2025 [1][2] - The conference call will be led by Executive Chairman David Cote, President & CEO Jon Wilk, and CFO Tim Fitzsimmons, followed by a Q&A session [2] - A live webcast and replay of the conference call will be available on the company's investor relations website [2] Group 2 - CompoSecure, founded in 2000, specializes in metal payment cards, security, and authentication solutions, serving fintechs and consumers globally [3] - The company focuses on delivering premium branded experiences through innovative payment card technology and Arculus security capabilities [3] - CompoSecure aims to ensure trust at the point of transaction, enhancing user experience in both physical and digital environments [3]

Ms. Corbin Loree stated: "I'm excited to be part of CompoSecure's Board as the company enters its next phase of growth. Drawing on my experience in capital markets and investor relations, I aim to support the team in driving long-term value and strengthening the company's market presence." "Rebecca and Kevin bring exceptional strategic and financial insight that will be instrumental as we continue to scale," said Jon Wilk, President and CEO of CompoSecure. "Their global experience and operational expertise ...

Core Insights - CompoSecure, Inc. (CMPO) has a strong track record of exceeding earnings estimates, particularly in the last two quarters, with an average surprise of 30.08% [1][5] - The company reported earnings of $0.19 per share for the most recent quarter, which was a surprise of 31.58% against an expected $0.25 per share [2] - For the previous quarter, CompoSecure reported $0.27 per share, surpassing the consensus estimate of $0.21 per share by 28.57% [2] Earnings Estimates and Predictions - Recent estimates for CompoSecure have been trending upward, with a positive Earnings ESP (Expected Surprise Prediction) indicating a likelihood of an earnings beat [5][8] - The current Earnings ESP for CompoSecure is +7.81%, suggesting analysts are optimistic about the company's earnings prospects [8] - Stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have a nearly 70% chance of producing a positive surprise [6][8] Earnings ESP Explanation - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate reflecting the latest analyst revisions [7] - A positive Earnings ESP indicates that analysts have recently become more bullish, while a negative value does not necessarily predict an earnings miss [8][10]

Core Insights - CompoSecure, Inc. has won six honors at the 2025 Élan Awards of Excellence, including four awards and two finalist positions, recognizing its leadership in metal payment cards and security solutions [1][3]. Company Overview - CompoSecure, founded in 2000, specializes in metal payment cards and security solutions, serving fintechs and consumers globally [4][5]. - The company has a total of 22 Élan Awards and has been a finalist 23 times, showcasing its consistent innovation and excellence in the card manufacturing industry [3]. Award Details - The awards received by CompoSecure include: - "Feature Card – Metal" for the FAB Islamic Emirati metal card, which features a three-dimensional falcon design [4]. - "Supplier/Vendor – New Product, Service or Innovation" for the Ellipse EVC marketing card, which has a dynamic security code to enhance fraud protection [4]. - "Manufacturer – Loyalty, Promotional, Gift Cards" for the Qantas Lifetime Platinum card, made from 65% post-consumer recycled stainless steel [4]. - "Feature Card – Metal" for the JCB The Class metal credit card, known for its intricate engraving and elegant design [4]. - "Manufacturer – Unique Innovation" for the Robinhood Gold Card, crafted from a solid block of gold with advanced security features [4]. Industry Context - The Élan Awards, organized by the International Card Manufacturers Association (ICMA), celebrate design innovation, security, and technical achievements in the card industry [2][3]. - ICMA has been a resource for card manufacturers and related industry participants for 35 years, addressing various industry issues [6].

I've had my eye on CompoSecure, Inc. ( CMPO ) for some time now (I’ll be honest: metal cards look pretty sleek), and I keep coming back to the same conclusion. The company doesn’t look like a typical hardwareI’m Emmanuel Onwusah—a financial analyst, writer, and recovering engineer. I hold FMVA® and BIDA® certifications from the Corporate Finance Institute, and I spend most of my time creating pitch decks, building models, analyzing companies, and trying to make sense of where value meets narrative. My backg ...

Core Points - CompoSecure, Inc. announced the retirement of its Chief Financial Officer, Tim Fitzsimmons, after over 13 years of service, with a successor expected to be named in the second half of 2025, no later than January 1, 2026 [1][6] - Tim Fitzsimmons will serve as a consultant to ensure a smooth transition until January 1, 2027 [1][6] - The company reaffirms its full year 2025 guidance, projecting mid-single digit growth in both Consolidated Net Sales and Pro Forma Adjusted EBITDA [3][6] Company Leadership Transition - Jon Wilk, President and CEO, acknowledged Tim Fitzsimmons' significant contributions, including supporting critical corporate transactions and building a strong lending group for debt financing [2] - Fitzsimmons expressed gratitude for the opportunity to lead the Finance and IT teams and emphasized the transformation of CompoSecure from a family-owned business to a publicly traded company [2] - Executive Chairman Dave Cote highlighted Fitzsimmons' lasting impact on the company and his central role in building the foundation of the business [2] Financial Guidance - CompoSecure's guidance for 2025 includes the payment of the Resolute Holdings management fee on a pro forma basis for 2024 and 2025 [3]