Core Viewpoint - B. Riley Financial, Inc. has entered into a privately negotiated exchange agreement with an institutional investor, which will reduce the company's total outstanding debt by approximately $12 million [1][2]. Debt Exchange Details - The investor will exchange approximately $22 million in outstanding Senior Notes for $10 million in newly issued 8.00% Senior Secured Second Lien Notes due January 1, 2028 [2]. - The company is also issuing warrants to the investor for approximately 40,000 common shares at an exercise price of $10.00 per share, which are exercisable for a period of seven years from the issuance date [2]. Management Commentary - Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley Financial, stated that this exchange is a step forward in strengthening the company's capital structure and that the company will continue to utilize its Senior Secured Second Lien facility for further transactions to improve its balance sheet [3]. Company Overview - B. Riley Financial is a diversified financial services company that provides tailored solutions across various sectors, including investment banking, institutional brokerage, private wealth management, and corporate restructuring [5]. - The company aims to deliver collaborative solutions at every stage of the business life cycle and opportunistically invests to benefit its shareholders [5].

Core Viewpoint - B. Riley Financial, Inc. has entered into a privately negotiated exchange agreement with an institutional investor, which will reduce the company's total outstanding debt by approximately $35 million [1][2]. Debt Exchange Details - The investor will exchange approximately $123 million in outstanding Senior Notes for $88 million in newly issued 8.00% Senior Secured Second Lien Notes due January 1, 2028 [2]. - The outstanding Senior Notes consist of approximately $86 million in 5.5% Senior Notes due March 31, 2026 and approximately $37 million in 5.0% Senior Notes due December 31, 2026 [2]. - The company is also issuing warrants to the investor to purchase approximately 351,000 common shares at an exercise price of $10.00 per share, exercisable for seven years from the issuance date [2]. Management Commentary - Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley Financial, stated that this exchange is an important step in addressing the company's capital structure and that there are expectations for additional transactions to improve the balance sheet [3]. Advisory Roles - Moelis & Company LLC acted as financial advisor and Sullivan & Cromwell LLP acted as legal advisor to B. Riley Financial regarding the agreement [3]. - Seaport Global Securities LLC served as financial advisor to the institutional investor [3]. Company Overview - B. Riley Financial is a diversified financial services company that provides tailored solutions across various sectors, including investment banking, institutional brokerage, and financial consulting [5]. - The company aims to deliver collaborative solutions at every stage of the business life cycle and opportunistically invests to benefit its shareholders [5].

Core Insights - B. Riley Financial has merged its investment banking subsidiary, B. Riley Securities (BRS), with Cascadia Investments, allowing Cascadia investors to become minority shareholders in BRS [1][2] - BRS will operate under a new governance structure and will be quoted on the OTC Pink market under the ticker "BRLY," enhancing transparency and independent valuation [2][6] - The firm has a strong track record, having led over 250 capital markets transactions and raised more than $115 billion in debt and equity since acquiring FBR in 2017 [3] Company Structure and Ownership - Post-transaction, B. Riley Financial retains approximately 89% ownership of BRS, with the remaining shares held by BRS employees and certain existing Cascadia shareholders [5] - BRS will have its own board of directors, with four members appointed by B. Riley Financial, including two independent directors [6] Leadership and Strategy - The leadership team of BRS, led by Andy Moore and Jimmy Baker, aims to focus on serving the middle market with capital markets, research, and M&A advisory services [4] - The company is positioned to capitalize on an expected recovery in M&A and capital markets activity, with a debt-free balance sheet and a commitment to client service [4] Financial Performance - BRS has historically delivered steady EBITDA and strong cash flow, with expectations to return to and exceed previous levels of growth and profitability as a separate entity [4]

Core Insights - B. Riley (NASDAQ: RILY) announced preliminary Q4 results, estimating net income between $48 million to $68 million, translating to earnings per share of $1.57 to $2.22 [1] - The significant income is primarily attributed to $236 million to $247 million from discontinued operations related to a divestiture [1] Financial Performance - Estimated net income for Q4 ranges from $48 million to $68 million [1] - Earnings per share are projected between $1.57 and $2.22 [1] - Income from discontinued operations is expected to be between $236 million and $247 million [1]

Financial Data and Key Metrics Changes - For Q4 2024, the company expects net income available to common shareholders to be between $48 million and $68 million, including approximately $236 million to $247 million from discontinued operations related to the divestiture of Great American businesses [30][31] - Diluted net income per share is projected to be between $1.57 and $2.22, with a net loss from continuing operations estimated at $178 million to $187 million, primarily due to impairment charges and trading losses [31][32] - Operating adjusted EBITDA from continuing operations is expected to be between $12 million and $14 million, with total debt reported at $1.78 billion, a decline of $221 million from the previous quarter [32][33] Business Line Data and Key Metrics Changes - The company established a joint venture with Oaktree Capital Management, contributing its appraisal and valuation services, which resulted in approximately $203 million in cash and a 44% ownership interest in the new entity [9][10] - The Wealth Management business is expected to manage approximately $15 billion in client assets after the sale of a portion of its traditional W-2 business to Stifel Financial Corp [12][23] - GlassRatner, the advisory services business, had a record year in 2024, indicating strong performance in its core expertise areas [24][42] Market Data and Key Metrics Changes - The company reported a strong December for its broker-dealer segment, which is positioned as a top provider to the middle market segment, with expectations of substantial operating EBITDA in a normalized environment [20][21] - The telecom business continues to provide steady cash flow and EBITDA, contributing positively to the overall financial health of the company [46] Company Strategy and Development Direction - The company aims to focus on its core businesses, including B. Riley Securities, Wealth Management, and advisory services, while monetizing non-core assets to strengthen its balance sheet [17][16] - The strategic partnership with Oaktree is expected to enhance the company's ability to deliver financial products and services, leveraging Oaktree's expertise and scale [10][11] - The company plans to continue exploring strategic opportunities to unlock value within its core business segments [22][42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about emerging from a period of asset monetization and debt reduction, positioning the company as a more nimble and focused entity [17][66] - The management acknowledged the challenges faced due to principal investments but emphasized the potential for recovery and growth in core operations [27][66] - The company is committed to investing in its business and addressing outstanding debt maturities while limiting dilution for shareholders [36][38] Other Important Information - The company completed the full redemption of its February 2025 senior notes, retiring its only significant maturity for that year [14] - A new $160 million senior secured credit facility was established with Oaktree, providing greater financial flexibility [15] Q&A Session Summary Question: What are the plans for liquidity and balance sheet improvement in the next six months? - Management indicated a focus on investing in core businesses and proactively aligning the balance sheet, with ongoing asset monetization efforts [36][37] Question: Can you provide insights on the core business's EBITDA and cash flow potential? - Management highlighted the historical performance of core businesses and expressed confidence in their ability to generate operating EBITDA, despite recent challenges [38][42] Question: What is the current state of the Wealth Management business after the recent sale? - The remaining Wealth Management group now manages approximately $15 billion in assets, down from $24 billion prior to the sale [58] Question: Will future asset monetization primarily come from the Principal Investment Group? - Management confirmed a careful approach to monetizing non-core assets while focusing on growing core businesses [60][61]

Financial Data and Key Metrics Changes - For Q4 2024, the company expects net income available to common shareholders to be between $48 million and $68 million, including approximately $236 million to $247 million from discontinued operations related to the divestiture of a majority interest in Great American businesses [30] - Diluted net income per share is projected to be between $1.57 and $2.22, with a net loss from continuing operations estimated at $178 million to $187 million, primarily due to impairment charges and trading losses [31] - Operating adjusted EBITDA from continuing operations is expected to be between $12 million and $14 million, with total debt reported at $1.78 billion, a decline of $221 million from the previous quarter [32] Business Line Data and Key Metrics Changes - The company established a joint venture with Oaktree Capital Management, contributing its appraisal and valuation services, which provided approximately $203 million in cash and a 44% ownership interest in the new entity [9] - The company sold a portion of its traditional W-2 Wealth Management business to Stifel Financial Corp, with expected cash consideration of approximately $26 million [13] - The advisory services business, GlassRatner, had a record year in 2024, indicating strong performance in its core expertise areas [24] Market Data and Key Metrics Changes - The wealth management business's assets under management decreased from approximately $24 billion to $15 billion following the sale of a majority of W-2 employees [58] - The company continues to focus on its core businesses, including B. Riley Securities, Wealth Management, and advisory services, while also looking for opportunities to monetize non-core assets [17][16] Company Strategy and Development Direction - The company aims to emerge as a more nimble and focused entity, concentrating on its core businesses and reducing debt through asset monetization [17] - The management emphasized the importance of investing in its broker-dealer, wealth management, and advisory businesses to drive growth [36] - The company plans to continue monetizing non-core assets to strengthen its balance sheet and support future growth [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for recovery and growth, highlighting the strategic actions taken to improve the balance sheet and focus on core operations [66] - The management acknowledged the challenges faced due to past principal investments but is committed to moving forward and capitalizing on new opportunities [6][27] Other Important Information - The company completed the full redemption of its February 2025 senior notes, retiring its only significant maturity for that year [14] - A new $160 million senior secured credit facility was established with Oaktree, providing greater financial flexibility [15] Q&A Session Summary Question: What are the plans for liquidity and balance sheet improvement in the next six months? - Management indicated a focus on investing in core businesses and aligning the balance sheet, while remaining opportunistic in asset monetization [36] Question: Can you provide insights on the core business's EBITDA and cash flow potential? - Management suggested looking at historical performance, noting that while the company is smaller, there is still significant operating EBITDA potential [38][42] Question: What is the value and EBITDA generation potential of the telecom and advisory businesses? - Management emphasized the importance of investing in operating businesses and maintaining profitability in wealth management and advisory services [46] Question: Is there an ability to buy back debt under the new credit agreement? - Management clarified that the current senior facility does not allow for buying bonds in the open market [51] Question: What does the wealth management business look like now after the sale? - Management noted that assets under management decreased significantly, providing context for the remaining wealth management group's size [58] Question: Will future asset monetization primarily come from the Principal Investment Group? - Management stated that they will be selective in monetizing non-core assets while focusing on growing core businesses [61]

Core Insights - Moore Law, PLLC is investigating potential claims against B. Riley Financial, Inc. due to undisclosed information regarding a management buyout involving Franchise Group, Inc. [1][3] - The management buyout of Franchise Group, Inc. was valued at $2.8 billion and completed on August 21, 2023 [2]. - B. Riley Financial, Inc. is facing scrutiny for allegedly financing a transaction linked to Brian Kahn, who has been implicated in a conspiracy to defraud investors [3]. Company Overview - B. Riley Financial, Inc. (NASDAQ: RILY) has seen its stock price decline over 70% in the past 12 months [3]. - Franchise Group, Inc. is a holding company that primarily acquires and manages franchises, and it is a client of B. Riley Financial, Inc. [1]. Legal Context - Investors who purchased shares of B. Riley Financial, Inc. prior to May 2023 are encouraged to contact Moore Law for potential claims related to the management buyout and associated disclosures [1][4]. - The investigation suggests that B. Riley's positive statements about its business and prospects may have been materially misleading due to the undisclosed risks [3].

Financial Reporting - B. Riley Financial, Inc. reported preliminary estimated financial information for the fiscal quarter ended December 31, 2024[8]. - The press release regarding financial results was issued on March 3, 2025[8]. - The report includes a cover page interactive data file embedded within the Inline XBRL document[10]. Company Information - The company is listed on the Nasdaq Global Market under the trading symbol RILY[4]. - Phillip J. Ahn serves as the CFO & COO of B. Riley Financial, Inc.[13].

Core Viewpoint - B. Riley Financial has successfully sold Atlantic Coast Recycling, LLC for approximately $70 million, expecting a gain of around $30 million in the first quarter [1][2]. Company Overview - B. Riley Financial is a diversified financial services company that provides tailored solutions to meet the strategic, operational, and capital needs of clients [2]. - The company offers a wide range of services including investment banking, institutional brokerage, private wealth management, financial consulting, corporate restructuring, and more [2]. - B. Riley Financial has made opportunistic investments to benefit its shareholders and has affiliates that originate and underwrite senior secured loans for asset-rich companies [2].

Core Viewpoint - B. Riley Financial, Inc. has successfully completed the redemption of all issued and outstanding 6.375% Senior Notes due February 28, 2025, at 100% of their principal amount plus accrued interest [1][2]. Company Overview - B. Riley Financial is a diversified financial services company that provides tailored solutions to meet the strategic, operational, and capital needs of its clients [3]. - The company offers a wide range of services including investment banking, institutional brokerage, private wealth and investment management, financial consulting, corporate restructuring, operations management, risk and compliance, due diligence, forensic accounting, litigation support, appraisal and valuation, auction, and liquidation services [3]. - B. Riley also engages in opportunistic investments to benefit its shareholders and has affiliates that originate and underwrite senior secured loans for asset-rich companies [3].