Financial Data and Key Metrics Changes - Sadat Group reported its fifth consecutive quarter of positive net income and positive EBITDA in Q2 2025, marking a significant turnaround from previous losses as a restaurant-only concept [6][7] - Revenue for Sadat Agri Foods in Q2 2025 was $114.4 million, a decrease of $58.9 million or 34% compared to Q2 2024, primarily due to selective trading with more favorable margins [21] - Gross profit improved to 4.4% in Q2 2025 from 3.3% in Q2 2024, an increase of 100 basis points attributed to higher margin trades [21] - Net income attributable to Sadat Group was $400,000 in Q2 2025, with EBITDA reported at CAD 1.7 million [21] - The company had a cash balance of $400,000 and a working capital surplus of $24.2 million [22] Business Line Data and Key Metrics Changes - The company completed 26 transactions representing over 200,000 metric tons of product shipped in Q2 across seven different countries [21] - SG&A expenses increased to £2.8 million, up £1.1 million from the previous year, mainly due to reclassifying some expenses [22] Market Data and Key Metrics Changes - The company announced a strategic investment in a carbon project in Indonesia, assigning approximately $13.4 million of accounts receivable to acquire a 37.5% equity stake in a local entity focused on carbon credits [23] Company Strategy and Development Direction - Sadat Group's strategy focuses on five core pillars: geographic and vertical expansion, operational efficiency, margin improvement, technological integration, and leadership excellence [12][13] - The company aims to modernize its operations through AI and data-driven technologies, enhancing decision-making capabilities across the trading lifecycle [11][12] - Sadat Group is transitioning from a restaurant-focused business to a diversified technology-enabled global agribusiness [12][25] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges of transitioning from a restaurant company to a global agriculture player, emphasizing the importance of skilled personnel in finance and technology [30] - The company is committed to divesting its restaurant holdings to focus on core agricultural operations and drive long-term shareholder value [31] Other Important Information - The company raised $2.5 million due to delays in collecting receivables and closing the sale of restaurants, indicating a non-toxic equity deal without warrants [28] - Management expressed confidence in the company's ability to navigate tariff concerns, noting that only a small percentage of trades are conducted with the United States [29] Q&A Session Summary Question: What is the status on the sale of the restaurants? - Management expressed dissatisfaction with the slow progress but confirmed they are in the final stages of negotiations with strong candidates for acquisition [26][27] Question: Why did the company recently raise $2.5 million and what are the proceeds being used for? - The capital was raised due to delays in collecting receivables and closing the sale of restaurants, structured as a straight equity deal [28] Question: How do tariffs affect Sadat Group? - Management indicated that only a small percentage of trades are with the U.S., allowing flexibility to avoid tariffs by moving transactions globally [29] Question: Why have there been so many changes in the board and management? - The changes are part of the strategic pivot from a restaurant company to an international player in the food supply chain, requiring specific skill sets [30]

[Financial & Operational Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) Sadot Group achieved its fifth consecutive quarter of positive net income and EBITDA, reporting $114.3 million in consolidated revenues and a 4.4% gross margin Key Financial Metrics | Financial Metric | Value | | :--- | :--- | | Consolidated Revenues | $114.3 million | | Net Income | $0.4 million | | EBITDA | $1.7 million | | Dilutive EPS | $0.07 | | Gross Margin | 4.4% | | Working Capital Surplus | $24.2 million | - Achieved the **fifth consecutive quarter** of **positive net income and EBITDA**[4](index=4&type=chunk) - Completed **26 transactions**, trading over **200,000 metric tons** of agri-commodities across 7 countries[4](index=4&type=chunk) - Gross margins increased to **4.4%**, a **100 basis point** improvement, by focusing on specialty commodities[4](index=4&type=chunk) - Appointed **Haggai Ravid as CEO** (May 28, 2025) and **Paul Sansom as CFO** (August 1, 2025)[4](index=4&type=chunk) - Made a strategic investment, acquiring a **37.5% equity stake** in an Indonesian carbon project focused on peatland and mangrove restoration, expected to generate **1.1 to 1.2 million carbon credits** in its first cycle[4](index=4&type=chunk) [Financial Statements](index=3&type=section&id=Financial%20Statements) The company's financial statements show a decrease in total assets to $130.6 million and a reduction in commodity sales to $114.3 million for the quarter compared to the prior year [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $130.6 million while total liabilities also declined, leading to an increase in Sadot Group Inc. shareholders' equity to $33.0 million as of June 30, 2025 Condensed Consolidated Balance Sheets Summary | Balance Sheet Items ($'000) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | **118,719** | **152,679** | | **Total Assets** | **130,629** | **164,654** | | **Total Current Liabilities** | **94,526** | **132,170** | | **Total Liabilities** | **94,690** | **132,281** | | **Total Sadot Group Inc. Shareholders' Equity** | **32,980** | **29,193** | | **Total Liabilities and Stockholders' Equity** | **130,629** | **164,654** | [Condensed Consolidated Statement of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Operations%20and%20Other%20Comprehensive%20Income%2F%20%28Loss%29) Commodity sales decreased to $114.3 million for the three months ended June 30, 2025, resulting in lower gross profit and a net income of $0.4 million attributable to Sadot Group Inc Condensed Consolidated Statement of Operations Summary | Income Statement Items ($'000) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Commodity Sales | 114,338 | 173,293 | | Gross Profit | 4,987 | 5,788 | | Income from Operations | 1,770 | 2,074 | | Net Income Attributable to Sadot Group Inc. | 389 | 2,369 | | Diluted EPS (Continuing Operations) | $0.08 | $0.45 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities totaled $5.4 million for the six months ended June 30, 2025, leading to a decrease in the company's cash balance to $0.4 million Condensed Consolidated Statements of Cash Flows Summary | Cash Flow Items ($'000) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by / (used in) operating activities | (5,367) | 10,461 | | Net cash provided by investing activities | — | 3 | | Net cash provided by / (used in) financing activities | 3,978 | (1,940) | | **Net Increase (Decrease) in Cash** | **(1,364)** | **8,602** | | **Cash – end of period** | **422** | **9,956** | [Non-GAAP Financial Measures](index=7&type=section&id=Reconciliations%20of%20EBITDA%20and%20Other%20Non-GAAP%20Measures) The company presents a reconciliation of Net Income to EBITDA, with EBITDA attributable to Sadot Group decreasing to $1.7 million and EBITDA margin contracting to 1.4% for Q2 2025 EBITDA Reconciliation | Reconciliation to EBITDA ($'000) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income | 286 | 2,317 | | Depreciation and amortization | 27 | 92 | | Interest expense, net | 1,237 | 1,008 | | Income tax expense | — | 5 | | **EBITDA** | **1,550** | **3,422** | | **EBITDA attributable to Sadot Group Inc.** | **1,653** | **3,474** | | **EBITDA margin attributable to Sadot Group Inc.** | **1.4 %** | **2.0 %** | [About Sadot Group Inc.](index=2&type=section&id=About%20Sadot%20Group%20Inc.) Sadot Group Inc. operates in the global food supply chain, providing sustainable solutions through agri-commodity trading and farm operations in Southern Africa - Sadot Group is an emerging player in the **global food supply chain**, focused on **sustainable solutions**[7](index=7&type=chunk) - Operates in two main verticals: **global agri-commodity origination/trading** and **farm operations in Southern Africa**[8](index=8&type=chunk) - Connects producers from the **Americas, Africa, and the Black Sea** with consumers in **Southeast Asia, China, and the MENA region**[9](index=9&type=chunk) [Forward-Looking Statements](index=8&type=section&id=Forward-Looking%20Statements) This section provides a standard legal disclaimer regarding forward-looking statements, advising readers to consult SEC filings for associated risks and uncertainties - The press release includes forward-looking statements under the "safe harbor" provisions of U.S. law[19](index=19&type=chunk) - These statements are **not guarantees of future performance** and are **subject to risks and uncertainties**[19](index=19&type=chunk) - The company **does not undertake a duty to update these statements**[19](index=19&type=chunk)

PART I - FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) The unaudited condensed consolidated financial statements for Sadot Group Inc. as of June 30, 2025, reflect a strategic shift towards the Agri-Foods sector, with the restaurant business classified as discontinued operations [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of June 30, 2025, shows a decrease in total assets to $130.6 million from $164.7 million at year-end 2024, primarily due to a reduction in 'Other current assets' Condensed Consolidated Balance Sheet Highlights (in $'000) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Cash | 422 | 1,786 | (1,364) | | Accounts receivable, net | 44,136 | 18,014 | 26,122 | | Total current assets | 118,719 | 152,679 | (33,960) | | Total assets | 130,629 | 164,654 | (34,025) | | **Liabilities & Equity** | | | | | Accounts payable and accrued expenses | 34,419 | 28,019 | 6,400 | | Total current liabilities | 94,526 | 132,170 | (37,644) | | Total liabilities | 94,690 | 132,281 | (37,591) | | Total stockholders' equity | 35,939 | 32,373 | 3,566 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended June 30, 2025, commodity sales decreased 34% year-over-year to $114.3 million, leading to a net income of $0.3 million, down from $2.3 million in Q2 2024 Statement of Operations Summary (in $'000, except per share data) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Commodity sales | 114,338 | 173,293 | 246,506 | 279,800 | | Gross profit | 4,987 | 5,788 | 10,999 | 8,598 | | Income from operations | 1,770 | 2,074 | 3,246 | 2,605 | | Net income | 286 | 2,317 | 1,106 | 2,004 | | Net income attributable to Sadot Group Inc. | 389 | 2,369 | 1,327 | 2,104 | | Diluted EPS (Continuing Operations) | $0.08 | $0.45 | $0.23 | $0.62 | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) Total stockholders' equity increased from $32.4 million at year-end 2024 to $35.9 million as of June 30, 2025, driven by net income, stock-based compensation, and convertible loan conversions - Key equity changes in the first six months of 2025 include the conversion of **$1.55 million** in convertible loans into **1,239,111 shares** of common stock[21](index=21&type=chunk) - The number of common shares issued and outstanding increased from **5,225,147** at the end of 2024 to **6,810,403** as of June 30, 2025[21](index=21&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, the company experienced a significant negative shift in operating cash flow, using $5.4 million compared to providing $10.5 million in the same period of 2024 Cash Flow Summary (in $'000) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash from operating activities | (5,367) | 10,461 | | Net cash from investing activities | — | 3 | | Net cash from financing activities | 3,978 | (1,940) | | **Net Increase (Decrease) in Cash** | **(1,364)** | **8,602** | | **Cash – end of period** | **422** | **9,956** | [Notes to the Condensed Consolidated Financial Statements (Unaudited)](index=16&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) The notes detail the company's transformation into a global Agri-Foods business, with its former restaurant segment now classified as discontinued operations and held for sale - The company transformed from a U.S. restaurant business to a global Agri-Foods supply chain organization in late 2022. The restaurant segment (Sadot Food Services) is now classified as held for sale and reported as discontinued operations[29](index=29&type=chunk)[32](index=32&type=chunk) - The company is experiencing delays in converting receivables into cash, which may impact liquidity. It utilizes a factoring agreement to manage short-term needs, under which it can sell eligible receivables for an **85% upfront advance**[33](index=33&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) - Gains from the fair value remeasurement of certain financial instruments were reclassified from 'Other income' to 'Cost of goods sold' to better reflect their economic link to inventory and sales activities[43](index=43&type=chunk) - Subsequent to the quarter end, the company invested **$13.4 million** in a carbon credit project, raised **$2.5 million** through a public stock offering, amended several convertible notes, closed its Sadot Korea subsidiary, and appointed a new CFO[266](index=266&type=chunk)[267](index=267&type=chunk)[278](index=278&type=chunk)[279](index=279&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=61&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's transformation into a global Agri-Foods business, with the restaurant operations discontinued, focusing on strategic shifts and liquidity Q2 2025 vs Q2 2024 Performance (in $'000) | Metric | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Commodity Sales | 114,338 | 173,293 | (58,955) | (34.0)% | | Gross Profit | 4,987 | 5,788 | (801) | (13.8)% | | Income from Operations | 1,770 | 2,074 | (304) | (14.7)% | | Net Income (to Sadot) | 389 | 2,369 | (1,980) | (83.6)% | YTD 2025 vs YTD 2024 Performance (in $'000) | Metric | YTD 2025 | YTD 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Commodity Sales | 246,506 | 279,800 | (33,294) | (11.9)% | | Gross Profit | 10,999 | 8,598 | 2,401 | 27.9% | | Income from Operations | 3,246 | 2,605 | 641 | 24.6% | | Net Income (to Sadot) | 1,327 | 2,104 | (777) | (36.9)% | - The decrease in commodity sales is attributed to a strategic decision to not pursue trades with unfavorable margins[309](index=309&type=chunk)[322](index=322&type=chunk) - Working capital increased to **$24.2 million** from **$20.5 million** at year-end 2024, and the current ratio improved to **1.26** from **1.16**. However, the company notes operational challenges in converting receivables to cash[332](index=332&type=chunk)[335](index=335&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=83&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that this section is not applicable - The company has determined that quantitative and qualitative disclosures about market risk are not applicable for this reporting period[350](index=350&type=chunk) [Controls and Procedures](index=83&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of June 30, 2025, and concluded they were effective - Based on an evaluation as of June 30, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures are effective[351](index=351&type=chunk) - There were no changes during the period that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[352](index=352&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=84&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in two significant legal matters, a dispute with Cropit Farming Limited in Zambia and a complaint from Lombard Trading International Corp. in Florida - Sadot LLC is in a legal dispute with Cropit Farming Limited in Zambia over the validity of agreements, with claims and counterclaims filed. Damages sought by Cropit are approximately **$6.7 million**[355](index=355&type=chunk)[356](index=356&type=chunk) - The company is defending against a complaint from Lombard Trading International Corp. alleging unjust enrichment and fraud related to a commodities transaction, with the plaintiff seeking **$7.4 million** in damages[360](index=360&type=chunk) - Management believes it has strong defensible positions in these matters and has not recorded any material liabilities, as a loss is not considered probable or reasonably estimable at this time[358](index=358&type=chunk)[359](index=359&type=chunk) [Risk Factors](index=84&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the risk factors detailed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - For a discussion of risk factors, the company refers investors to its Annual Report on Form 10-K for the year ended December 31, 2024, filed on March 11, 2025[361](index=361&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=85&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first half of 2025, the company issued numerous unregistered shares of its common stock, primarily for note conversions, consultant compensation, and related-party consulting fees - The company issued common stock for services rendered to consultants and board members[362](index=362&type=chunk)[364](index=364&type=chunk)[366](index=366&type=chunk) - A significant number of shares were issued in exchange for the conversion or repayment of notes payable throughout the period[368](index=368&type=chunk)[369](index=369&type=chunk)[370](index=370&type=chunk) - On March 31, 2025, the company vested **79,342 shares** of common stock to Aggia as consulting fees earned during Q1 2025[367](index=367&type=chunk) [Defaults Upon Senior Securities](index=87&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - There were no defaults upon senior securities during the reporting period[379](index=379&type=chunk) [Mine Safety Disclosures](index=87&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company states that this section is not applicable - This item is not applicable to the company[380](index=380&type=chunk) [Other Information](index=87&type=section&id=Item%205.%20Other%20Information) This section details significant leadership and board changes during and shortly after the quarter, including new CEO and CFO appointments and board resignations - Chagay Ravid was appointed as the new Chief Executive Officer on May 28, 2025[386](index=386&type=chunk) - Paul Sansom was appointed Chief Financial Officer, effective August 1, 2025, following the resignation of Jennifer Black[388](index=388&type=chunk) - The company experienced several changes to its Board of Directors, including the passing of one member and the resignation of two others, including the Chairman[381](index=381&type=chunk)[383](index=383&type=chunk) [Exhibits](index=88&type=section&id=Item%206.%20Exhibits) This section provides a list of all exhibits filed with the Form 10-Q, including agreements, corporate governance documents, and certifications

Financial Data and Key Metrics Changes - STADOT AgriFoods revenue was $132.2 million in Q1 2025, an increase of $25.7 million or 24.1% compared to Q1 2024 [6][7] - Net income attributable to Sadat Group improved to $900,000 in Q1 2025 from a net loss of $300,000 in Q1 2024, representing an improvement of $1.2 million [7] - EBITDA rose to $2.5 million compared to $100,000 in the prior period [7] - Basic and diluted earnings per share were positive at $0.018 per share compared to a negative $0.06 per share in the prior year [7] - SG&A expenses increased to $3.1 million, up over $1.7 million compared to last year [7][8] - Cash balance stood at $1.9 million with a working capital surplus of $21.9 million [8] Business Line Data and Key Metrics Changes - The company completed 76 transactions in Q1 across 17 different countries, indicating a broad operational reach [6] - The increase in SG&A expenses was primarily due to reclassifying some costs from cost of goods sold to SG&A, reflecting a more accurate cost structure [8] Market Data and Key Metrics Changes - Sadat Group's revenue is largely generated outside the United States, with minimal impact from U.S. tariffs [15][16] - The company has conducted agri commodity trades with 33 countries, indicating a diverse market presence [15] Company Strategy and Development Direction - The company aims to reinvest cash into the Agri Food commodity trading business to drive revenue growth and acquire strategic assets [8] - Sadat Group is focusing on improving gross margins by targeting higher-margin products like containerized specialty crops [20] - The company is exploring opportunities in the pet food ingredients processing business as part of its growth strategy [20][21] Management's Comments on Operating Environment and Future Outlook - Management believes that tariffs will not have a significant material impact on Sadat's business due to its global trading model [15][18] - The company is adapting to shifts in demand, particularly from China, by sourcing products from alternative markets [19] - Management acknowledges the need to improve the balance sheet and income statements within a controlled growth plan [10][11] Other Important Information - The restaurant division reported a positive net income of $107,000 in Q1, with ongoing expansion plans for the Pokemoto chain [23][24] - The sale of the restaurant division is progressing, with multiple interested parties and a new Letter of Intent being finalized [23] Q&A Session Summary Question: Can you comment with an update on the general tariff environment and how it affects Sadat's business? - Management stated that tariffs will not have a significant material impact on Sadat due to its global operations and revenue generation primarily outside the U.S. [15][18] Question: How have the tariffs between the U.S. and China impacted the business directly? - Management noted a shift in China's demand for products like soybeans from U.S. sources to other markets, which Sadat is studying to capitalize on new opportunities [19] Question: The company's gross margins have been less than 1%. How are you going to improve those margins? - Management is focusing on higher-margin products like specialty crops and has signed a management services agreement for a pet food ingredients processing business [20][21] Question: Please provide an update on the sale of the restaurant process. - Management indicated that while the sale is taking longer than expected, progress is being made with multiple interested parties and ongoing expansion of the Pokemoto chain [23][24]

Financial Data and Key Metrics Changes - STADOT AgriFoods revenue was $132.2 million in Q1 2025, an increase of $25.7 million or 24.1% compared to Q1 2024 [6] - Net income attributable to Sadat Group improved to $900,000 in Q1 2025 from a net loss of $300,000 in Q1 2024, marking an improvement of $1.2 million [7] - EBITDA rose to $2.5 million compared to $100,000 in the prior period [7] - Basic and diluted earnings per share were $0.018 compared to a loss of $0.06 per share in the prior year [7] - SG&A expenses increased to $3.1 million, up over $1.7 million compared to last year [7][8] - Cash balance was $1.9 million with a working capital surplus of $21.9 million [8] Business Line Data and Key Metrics Changes - The company completed 76 transactions in Q1 across 17 different countries, indicating a broad operational reach [6] - The increase in SG&A expenses was primarily due to reclassifying some costs from cost of goods sold to SG&A, reflecting a more accurate cost structure [8] Market Data and Key Metrics Changes - Sadat Group's revenue is largely generated outside the United States, with minimal impact from U.S. tariffs [16] - The company has conducted agri commodity trades with 33 countries, indicating a diverse market presence [16] Company Strategy and Development Direction - The company aims to reinvest cash into the Agri Food commodity trading business to drive revenue growth and acquire strategic assets [8] - The new CEO plans to improve the balance sheet and income statements within a controlled growth plan, focusing on operational efficiencies and cost-cutting [12][13] Management's Comments on Operating Environment and Future Outlook - Management believes that tariffs will not have a significant material impact on Sadat's business due to its global trading model [16][18] - The company is studying shifts in trade flows, particularly from the U.S. to other markets like Brazil, to capitalize on new opportunities [19] - There is a focus on improving gross margins through higher-margin products like containerized specialty crops [20] Other Important Information - The restaurant division reported a positive net income of $107,000 in Q1, with ongoing expansion plans [24] - The sale of the restaurant chain is progressing, with multiple interested parties and new locations opening [23][24] Q&A Session Summary Question: Can you comment with an update on the general tariff environment and how it affects Sadat's business? - Management stated that tariffs will not significantly impact Sadat due to its global operations and revenue generation outside the U.S. [16] Question: How have the tariffs between the U.S. and China impacted the business directly? - The company has a flexible trading model and is studying shifts in demand, particularly from China to other markets [19] Question: The company's gross margins have been less than 1%. How are you going to improve those margins? - The focus is on higher-margin products like pulses and specialty crops, along with a management services agreement for a pet food ingredients processing business [20][21] Question: Please provide an update on the sale of the restaurant process. - The sale is taking longer than expected, but there are multiple interested parties, and the restaurant division continues to expand [23][24]

[Form 8-K Filing Summary (April 28, 2025)](index=1&type=section&id=Form%208-K%20Filing) [Results of Operations, Financial Condition, and Regulation FD Disclosure](index=2&type=section&id=Item%202.02%20%26%207.01) Sadot Group Inc. released an updated investor presentation on April 28, 2025, detailing financial results and condition, furnished under Regulation FD and not deemed 'filed' - The company released an updated investor presentation on its website on April 28, 2025[5](index=5&type=chunk) - The presentation is furnished as Exhibit 99.1 to the Form 8-K and is incorporated by reference into Item 7.01[5](index=5&type=chunk) - The information in the report and exhibit is being furnished and is not deemed "filed" under the Securities Exchange Act of 1934, nor is it subject to the liabilities of Section 18[6](index=6&type=chunk) [Non-GAAP Financial Information](index=2&type=section&id=Non-GAAP%20Financial%20Information) The company utilizes non-GAAP financial measures like EBITDA and EBITDA Margin in its investor presentation, defining EBITDA as adjusted net profit/loss, while cautioning about their limitations and comparability - The company utilizes non-GAAP financial measures, including **EBITDA** and **EBITDA Margin**, in its presentation[7](index=7&type=chunk) - EBITDA is defined as Net Profit/Loss, adjusted for depreciation, amortization, interest income/(expense), and income taxes[7](index=7&type=chunk) - The company warns that its non-GAAP measures have limitations and may not be comparable to similar measures disclosed by other issuers[7](index=7&type=chunk) [Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits filed with the Current Report on Form 8-K, primarily Exhibit 99.1, the investor presentation, and the interactive data file Exhibit List | Exhibit No. | Description | | :--- | :--- | | 99.1 | Investor Presentation in use beginning April 18, 2025 | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

[Financial Information](index=4&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Condensed Consolidated Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) Q1 2025 financial statements reflect a strategic shift to agri-foods, with decreased assets, a net income turnaround, and negative operating cash flow [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets and liabilities significantly decreased, while stockholders' equity slightly increased Condensed Consolidated Balance Sheet Highlights (in $'000) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | 71,802 | 152,679 | | **Total Assets** | **83,744** | **164,654** | | **Total Current Liabilities** | 49,934 | 132,170 | | **Total Liabilities** | **50,039** | **132,281** | | **Total Stockholders' Equity** | **33,705** | **32,373** | - The significant decrease in current assets and liabilities is primarily linked to the settlement and revaluation of derivative contracts previously held on the balance sheet[11](index=11&type=chunk)[119](index=119&type=chunk)[146](index=146&type=chunk) [Condensed Consolidated Statement of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Operations) Q1 2025 saw a net income turnaround driven by increased commodity sales and gross profit, despite rising operating expenses Statement of Operations Highlights (in $'000) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Commodity sales** | 132,168 | 106,507 | | **Gross profit** | 6,012 | 2,810 | | **Income from operations** | 1,476 | 530 | | **Net income / (loss)** | 820 | (313) | | **Net income / (loss) attributable to Sadot Group Inc.** | 938 | (265) | | **Diluted EPS from continuing operations** | $0.16 | $0.20 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating activities used cash due to increased receivables, while financing activities provided inflow, slightly increasing the cash balance Cash Flow Summary (in $'000) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by / (used in) operating activities** | (2,950) | 2,507 | | **Net cash provided by investing activities** | — | 29 | | **Net cash provided by / (used in) financing activities** | 3,114 | (2,761) | | **Net Increase (Decrease) in Cash** | 154 | (140) | | **Cash – end of period** | 1,940 | 1,214 | [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the company's transformation to agri-foods, reclassification of fair value gains, liquidity reliance on factoring, legal proceedings, and related-party transactions - The company has transformed from a U.S. restaurant business into a global agri-food commodity supply chain organization. The restaurant segment is now classified as discontinued operations held for sale[28](index=28&type=chunk)[31](index=31&type=chunk)[101](index=101&type=chunk) - The company reclassified fair value gains on certain financial instruments from 'Other income' to 'Cost of goods sold' to better reflect their economic link to inventory and sales activities. For Q1 2024, this increased gross profit by **$3.25 million**[44](index=44&type=chunk)[45](index=45&type=chunk) - The company is involved in two significant legal proceedings: one initiated by Cropit Farming in Zambia seeking **$6.7 million** in damages, and another by Lombard Trading in Florida seeking **$7.4 million**. The company is vigorously defending against both claims[165](index=165&type=chunk)[167](index=167&type=chunk)[172](index=172&type=chunk) - Significant related-party transactions exist with Aggia LLC, which owns **11.2%** of the company. In Q1 2025, this included **$1.0 million** in stock-based consulting fees and **$0.8 million** in reimbursed operating costs[230](index=230&type=chunk)[231](index=231&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=54&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A discusses the company's agri-foods transformation, increased commodity sales and gross profit, but highlights liquidity pressures from receivables and rising operating expenses [Results of Operations](index=58&type=section&id=Results%20of%20Operations) Q1 2025 results show increased commodity sales and gross profit driven by market expansion, despite substantial rises in SG&A and net interest expenses Results of Operations Comparison (in $'000) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Variance $ | Variance % | | :--- | :--- | :--- | :--- | :--- | | **Commodity sales** | 132,168 | 106,507 | 25,661 | 24.1% | | **Gross profit** | 6,012 | 2,810 | 3,202 | 114.0% | | **Sales, general and administrative expenses** | (3,081) | (1,393) | (1,688) | 121.2% | | **Income from operations** | 1,476 | 530 | 946 | 178.5% | | **Net income / (loss) attributable to Sadot Group Inc.** | 938 | (265) | 1,203 | 454.0% | - The increase in commodity sales is attributed to expanded operations in new markets that were not active in the prior year[272](index=272&type=chunk) - The increase in SG&A expenses was primarily due to higher consulting fees related to trades in Latin America, Brazil, and Canada, and entry into the South Korean market[276](index=276&type=chunk) [Liquidity and Capital Resources](index=66&type=section&id=Liquidity%20and%20Capital%20Resources) Working capital increased, but liquidity is challenged by delayed receivables conversion, necessitating reliance on factoring and potential future capital raises Working Capital (in $'000) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | 71,802 | 152,679 | | **Total current liabilities** | 49,934 | 132,170 | | **Working capital** | **21,868** | **20,509** | | **Current ratio** | 1.44 | 1.16 | - The company faces liquidity challenges due to delays in converting receivables into cash, despite having sufficient working capital on paper[281](index=281&type=chunk)[283](index=283&type=chunk) - The company relies on a factoring agreement for liquidity, where it can sell certain receivables with recourse for an **85%** upfront advance[283](index=283&type=chunk) - Management states the need to raise additional capital, warning that failure to do so could require selling business lines or assets and could result in significant shareholder dilution[285](index=285&type=chunk)[286](index=286&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=69&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable, indicating no material market risk disclosures are required for this smaller reporting company filing - Not applicable for this filing[297](index=297&type=chunk) [Controls and Procedures](index=69&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of March 31, 2025, the company's disclosure controls and procedures were effective[298](index=298&type=chunk) - No material changes were made to the internal control over financial reporting during the first quarter of 2025[299](index=299&type=chunk) [Other Information](index=70&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Legal Proceedings](index=70&type=section&id=Item%201.%20Legal%20Proceedings) The company is defending against two significant legal proceedings, one in Zambia for $6.7 million and another in Florida for $7.4 million, both related to commodity transactions - Cropit Farming Limited has sued Sadot LLC in Zambia, seeking rescission of agreements and damages of approximately **$6.7 million**. Sadot LLC has denied the allegations and filed counterclaims[302](index=302&type=chunk)[303](index=303&type=chunk) - Lombard Trading International Corp. has sued the company in Florida for **$7.4 million** related to a commodities transaction, alleging unjust enrichment, fraud, and theft. The company denies the allegations[307](index=307&type=chunk) - Management believes it has strong defensible positions in both matters and has not recorded any material liabilities, as a loss is not considered probable or reasonably estimable at this time[305](index=305&type=chunk)[306](index=306&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=70&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company issued unregistered common stock in Q1 2025, primarily for consulting services and to its related party, Aggia - On March 25, 2025, the company issued **34,074** shares of common stock to consultants for services rendered[314](index=314&type=chunk) - On March 31, 2025, the company vested **79,342** shares of common stock to its related party, Aggia, as consulting fees earned during Q1 2025[315](index=315&type=chunk) - The company also issued shares in Q1 2024 for board compensation, conversion of notes payable, and other consulting services[309](index=309&type=chunk)[310](index=310&type=chunk)[312](index=312&type=chunk) [Other Information](index=71&type=section&id=Item%205.%20Other%20Information) The company experienced significant changes in its board and executive leadership, including director resignations, a board member's passing, and a CEO transition - Two directors, Kevin Mohan and Chairman Mark McKinney, resigned from the Board effective May 8, 2025[319](index=319&type=chunk) - Board member Marvin Yeo passed away unexpectedly on April 27, 2025[320](index=320&type=chunk) - CEO Catia Jorge resigned effective June 1, 2025, and David Hanna was appointed Interim CEO for a **90-day** period[321](index=321&type=chunk)

Financial Data and Key Metrics Changes - For Q4 2024, the company generated consolidated revenue of $216.2 million, achieving net income of $0.7 million and EBITDA of $2.2 million [9][10] - For the full year ended December 31, 2024, consolidated revenue was $700.9 million, with net income of $4 million and EBITDA of $8.9 million, representing substantial improvements from 2023 [10][20] - Q4 net income improved by $2.6 million and EBITDA improved by $4.3 million compared to Q4 2023 [11] - Full year net income improved by $11.8 million and EBITDA improved by $15.1 million over 2023 [11] Business Line Data and Key Metrics Changes - Sadot agri foods revenue was $216.2 million in Q4 and $700.9 million for the full year, with 75 trade-related transactions in Q4 across 20 countries and 144 transactions for the full year across 33 countries [19][20] - SG&A expenses were reduced by $1.3 million to $9 million in Q4 due to reclassifying certain expenses to discontinued operations [21] Market Data and Key Metrics Changes - The company is exposed to market risk primarily due to the volatility in prices of food and feed commodities, and it manages these risks through forward sales contracts and hedges [22][23] - The mark-to-market gain on derivative transactions contributed approximately $5.1 million in income for Q4 and $17.1 million for the year [23] Company Strategy and Development Direction - The company aims to drive operational efficiencies, strengthen investor relations, expand into new markets, diversify its commodity portfolio, and pursue strategic growth initiatives [28][29] - The CEO emphasized the opportunity to grow Sadot into a significant player in the nearly $2 trillion global agri commodities market [17][30] Management's Comments on Operating Environment and Future Outlook - Management believes positive changes are occurring across the business, with a focus on scaling operations and optimizing the supply chain to maximize margins [24][28] - The CEO noted that the current tariff situation between the U.S. and Canada is not expected to materially affect operations [25][26] Other Important Information - The company completed its Form 10-K filing with the SEC on March 11, 2025, detailing its financial results [19] - The CEO introduced herself and highlighted her extensive experience in the agri commodities sector, indicating a strong leadership direction for the company [12][14] Q&A Session Summary Question: Update on the sale of the restaurants - The restaurant sale process is ongoing, with multiple parties in advanced stages of negotiations, and the focus is on divesting the restaurants to concentrate on the global food supply chain [35][36] Question: Impact of tariffs on Sadot - Most trades are initiated outside the U.S. and are not subject to recent U.S. trade tariffs, and the company has a flexible trading model to capitalize on changes in trade flows [38] Question: Changes in board and executive management - Recent changes align with the company's divestment from the U.S. restaurant business and focus on the global agri commodities supply chain, bringing in industry-specific experts [40][42] Question: Enhancing investor relations and public relations efforts - The company plans to increase investor relations efforts, enhance shareholder communication, and drive awareness through various channels [45][48] Question: Next steps for Sadot and market focus - The company will strengthen its presence in Brazil and Argentina while expanding into growing consumption markets like MENA and Asia [52] Question: Growing in a competitive market - The CEO sees tremendous opportunity due to the company's size, team, and global presence, with plans to streamline operations and increase shareholder value [54]

Financial Data and Key Metrics Changes - For Q4 2024, the company generated consolidated revenue of $216.2 million, achieving net income of $0.7 million and EBITDA of $2.2 million [9][10] - For the full year ended December 31, 2024, consolidated revenue was $700.9 million, with net income of $4 million and EBITDA of $8.9 million, representing substantial improvements from 2023 [10][20] - Q4 net income improved by $2.6 million and EBITDA improved by $4.3 million compared to Q4 2023 [11] - Full year net income improved by $11.8 million and EBITDA improved by $15.1 million compared to 2023 [11] Business Line Data and Key Metrics Changes - The company completed 75 trade-related transactions in Q4 across 20 different countries and 144 transactions for the full year across 33 countries [19] - SG&A expenses were reduced by $1.3 million to $9 million in Q4, mainly due to reclassifying certain expenses to discontinued operations [21] Market Data and Key Metrics Changes - The company had a cash balance of $1.8 million and a working capital surplus of $20.5 million [22] - The mark-to-market gain on derivative transactions contributed approximately $5.1 million in income for Q4 and $17.1 million for the year [23] Company Strategy and Development Direction - The company aims to drive operational efficiencies, strengthen investor relations, expand into new markets, diversify its commodity portfolio, and pursue strategic growth initiatives [28][29] - The CEO emphasized the opportunity to grow within the nearly $2 trillion global agri commodities market [17][30] Management's Comments on Operating Environment and Future Outlook - Management believes positive changes are occurring across the business and remains focused on advancing core agri commodity operations [24][30] - The CEO noted that the current tariff situation between the U.S. and Canada is not expected to materially affect operations [25][26] Other Important Information - The company is in the process of divesting its restaurant business, which is a top priority to focus on the global food supply chain [36] - The company is evaluating its current IR and PR strategy to enhance awareness and communication with investors [48] Q&A Session Summary Question: Update on the sale of the restaurants - The restaurant sale process is moving forward, with multiple parties in advanced stages of negotiations [36] Question: Impact of tariffs on Sadot - Most trades are initiated outside the U.S. and are not subject to recent U.S. trade tariffs, making tariffs a non-material event [38] Question: Changes in board and executive management - Recent changes align with the company's focus on the global agri commodities supply chain and bring in industry-specific experts [40] Question: Enhancing IR and PR efforts - Plans include more frequent announcements, non-deal roadshows, and evaluating the current IR and PR strategy [46][48] Question: Next steps for Sadot and market focus - The company will strengthen its presence in Brazil and Argentina while expanding into growing consumption markets like MENA and Asia [52] Question: Growing in a competitive market - The CEO sees opportunities due to the company's size, team, and global presence, focusing on streamlining operations [54]

Financial Performance - Q4 2024 net income increased to $0.7 million, compared to a net loss of $1.9 million in the prior year period [4] - FY 2024 net income reached $4.0 million, a significant improvement from a net loss of $7.8 million in FY 2023 [4] - Net income for 2024 was $3,736,000 compared to a net loss of $8,042,000 in 2023 [22] - The company reported a diluted EPS of $0.86 for FY 2024, compared to a diluted EPS loss of $2.24 in 2023 [4] - Net income margin attributable to Sadot Group Inc. improved to 0.5% in 2024 from a loss margin of (1.1)% in 2023 [22] EBITDA and Revenue - FY 2024 EBITDA rose to $8.9 million, compared to a loss of $6.2 million in the prior year [4] - EBITDA for 2024 was $8,647,000, a significant improvement from a negative EBITDA of $6,446,000 in 2023 [22] - EBITDA margin attributable to Sadot Group Inc. increased to 1.3% in 2024 from (0.9)% in 2023 [22] - Consolidated revenue for FY 2024 was $700.9 million, down from $717.5 million in FY 2023 [15] Operational Changes - The company converted all owned locations to franchise operations, resulting in operational savings [5] - Sadot Group launched operations in Canada and entered the pet food ingredient market in 2024 [5][6] - The company completed 144 transactions of over 1.7 million metric tons of agri-commodities across 33 countries in 2024 [5] Leadership and Management - Catia Jorge was appointed CEO, bringing extensive experience from Cargill and Olam to lead the company's growth [5] Assets and Expenses - Total current assets increased to $152.7 million in FY 2024 from $112.9 million in FY 2023 [13] - Depreciation and amortization expenses decreased to $259,000 in 2024 from $1,143,000 in 2023 [22] - Interest expense, net rose significantly to $4,649,000 in 2024 from $468,000 in 2023 [22] Future Outlook - The company anticipates future growth but acknowledges risks and uncertainties that may affect actual results [23] - Forward-looking statements are based on reasonable assumptions but are subject to various risks [23] Investor Relations - Investor relations contact is available at IR@sadotco.com [24]