Transaction Overview - B Riley Financial has sold its financial advisory services business GlassRatner [1] - The buyer is Canadian private equity firm TorQuest Partners [1]

Core Points - B. Riley Financial, Inc. received a notification from Nasdaq regarding non-compliance due to delayed filings of its Annual Report on Form 10-K for the period ended December 31, 2024, and Quarterly Report on Form 10-Q for the period ended March 31, 2025 [1] - The company expects to return to a normal filing cadence by Fall 2025 [3] - Nasdaq has granted an exception allowing the company to regain compliance with the filing requirements by September 29, 2025 [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 [4] - The company offers a wide range of services including investment banking, institutional brokerage, private wealth management, financial consulting, corporate restructuring, and more [4] - 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 [4]

Core Viewpoint - B. Riley Financial, Inc. has entered into a privately negotiated exchange agreement that will reduce its total outstanding debt by approximately $46 million and eliminate more than $100 million in 2026 maturities [1][3]. Group 1: Debt Exchange Agreement - The agreement involves the exchange of approximately $139 million in outstanding Senior Notes for $93 million in newly issued 8.00% Senior Secured Second Lien Notes due January 1, 2028 [2]. - The outstanding Senior Notes include $30 million in March 2026 notes, $75 million in December 2026 notes, and $35 million in January 2028 notes [2]. - The company is also issuing warrants to the investor to purchase approximately 372,000 common shares at an exercise price of $10.00 per share, exercisable for seven years [2]. Group 2: Management Commentary - Bryant Riley, Chairman and Co-CEO, stated that the company has made significant progress in addressing its capital structure, negotiating three bond exchanges to reduce total outstanding debt by approximately $93 million [3]. - The current exchange is noted as the largest to date and represents a significant reduction in near-term debt, marking an important step forward for the company [3]. - The company plans to opportunistically utilize the remaining capacity under its Senior Secured Second Lien facility to further improve its balance sheet [3]. Group 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 leverages cross-platform expertise to deliver collaborative solutions at every stage of the business life cycle [5].

Core Viewpoint - B. Riley Securities Holdings, Inc. has provided a business and financial update following its carve-out from B. Riley Financial, Inc., emphasizing a commitment to financial transparency and long-term value creation despite macroeconomic uncertainties [1][2]. Financial Performance - For the year 2024, B. Riley Securities reported total revenue of $217.7 million and adjusted net income of $33.1 million, while experiencing a net loss of $14.5 million [4][12]. - The adjusted financials reflect contributions from Cascadia Investments Inc. and other subsidiaries as if they had been completed on January 1, 2024 [5][11]. Debt and Cash Position - The company is now completely debt-free, having repaid all $12.4 million of its outstanding debt, and holds $68 million in cash and securities as of the carve-out effective date [6][5]. Operational Highlights - In 2024, B. Riley Securities raised $16.5 billion in debt and equity for clients and expanded its capabilities in key areas such as Convertibles and Liability Management [3]. - The advisory practice has been realigned to better serve core clients, focusing on Capital Markets [3]. Strategic Focus - The company aims to enhance visibility into its strategy and vision for value creation, positioning itself for sustainable growth and maximizing shareholder value [2][3].

Core Viewpoint - B. Riley Financial has appointed Scott Yessner as the new Chief Financial Officer, effective June 3, 2025, succeeding Phillip Ahn, who is leaving for another opportunity [1][3]. Group 1: Appointment Details - Scott Yessner has been a strategic advisor for B. Riley Financial for the past two months prior to his appointment [1]. - Phillip Ahn has been with B. Riley for over a decade and has played a significant role in the company's executive team [3]. Group 2: Scott Yessner's Background - Mr. Yessner has extensive experience as a CFO, having previously improved EBITDA by $40 million at CEMCO and $45 million at Universal Technical Institute, with the latter seeing a 250% increase in stock price during his tenure [2][4]. - He has also held executive roles at Wells Fargo Advisors and MUFG Union Bank, and has experience advising private equity firms [5]. Group 3: Company Insights - B. Riley Financial is a diversified financial services company that provides a wide range of solutions including investment banking, private wealth management, and corporate restructuring [6]. - The company aims to deliver tailored solutions to meet the strategic, operational, and capital needs of its clients [6].

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]