Financial Performance - Net income for the year ended December 31, 2025, was $22.1 million, an increase of $7.0 million, or 46%, compared to $15.1 million in 2024[221] - Net income for the year ended December 31, 2025, was $22.1 million, or $1.21 per diluted common share, compared to $15.1 million, or $0.82 per diluted common share for 2024, reflecting a significant increase in profitability[229] - Noninterest income increased by $1.1 million, or 44%, to $3.6 million for the year ended December 31, 2025, compared to $2.5 million in 2024[221] - Noninterest income rose to $3.6 million for 2025, an increase of $1.1 million, or 44%, compared to $2.5 million in 2024, primarily driven by income from a minority investment[230] - Net interest income increased by $8.2 million, or 15%, to $63.8 million for the year ended December 31, 2025, compared to $55.6 million in 2024[221] - Net interest income for the year ended December 31, 2025 was $63.8 million, an increase of $8.2 million, or 15%, compared to $55.6 million for 2024[240] Asset and Loan Growth - Total assets increased to $2.29 billion at December 31, 2025, compared to $2.20 billion at December 31, 2024, an increase of $93.3 million[221] - Total loans increased by $71.0 million, or 4%, from December 31, 2024, to December 31, 2025, with nonperforming loans at 0.47% of total assets[221] - Total loans, net of fees, rose to $1.94 billion, an increase of $71.0 million or 4% from $1.87 billion in 2024[264] - Average loans receivable slightly decreased by $7.1 million to $1.86 billion for the year ended December 31, 2025, while the yield on average loans increased by 14 basis points to 5.85%[243] Deposit Growth - Total deposits rose by $126.7 million, or 7%, from December 31, 2024, to December 31, 2025, with noninterest-bearing deposits at $363.2 million[221] - Total deposits increased by $126.7 million, or 7%, to $2.00 billion at December 31, 2025, compared to $1.87 billion at December 31, 2024[263] - Noninterest-bearing demand deposits were $363.8 million at December 31, 2025, representing 18.2% of total deposits[304] - Core deposits, excluding wholesale deposits, rose by $91.6 million, or 6%, to $1.71 billion at December 31, 2025[304] - Wholesale deposits increased by $35.1 million, or 14%, to $285.0 million at December 31, 2025[305] Expense Management - Noninterest expense was $37.6 million for 2025, an increase of $1.8 million, or 5%, primarily due to increased salaries and benefits[221] - Noninterest expense was $37.6 million for 2025, an increase of $1.8 million, or 5%, from $35.8 million in 2024, mainly due to higher salaries and benefits[231] - Salaries and employee benefits expense increased by $1.4 million to $20.1 million, a rise of 7.3% from $18.8 million in 2024[261] Credit Quality - The provision for credit losses totaled $1.6 million in 2025, compared to $6 thousand in 2024, primarily due to an increase in total loans[221] - Nonperforming loans at December 31, 2025 totaled $10.9 million, or 0.48% of total assets, down from $12.9 million, or 0.58%, at December 31, 2024[251] - The ratio of nonperforming loans to total assets improved to 0.47% from 0.58% in 2024[271] - The allowance for credit losses on loans to NPLs increased to 172.86% at December 31, 2025, compared to 140.97% at December 31, 2024, indicating a more conservative approach to credit risk management[279] Capital and Equity - Total shareholders' equity at December 31, 2025, was $253.6 million, an increase of $18.2 million from $235.4 million at December 31, 2024[314] - The common equity tier 1 capital ratio was 14.37% at December 31, 2025, exceeding the minimum requirement of 7.00%[319] - Total risk-based capital was $296.6 million, representing a ratio of 15.38% at December 31, 2025, above the minimum requirement of 10.50%[319] - Tangible common equity increased to $246,305 thousand in 2025, up from $227,934 thousand in 2024, reflecting a stronger capital base[228] Investment and Securities - The investment securities portfolio's fair value decreased by $3.3 million, or 2%, to $153.2 million at December 31, 2025, from $156.5 million at December 31, 2024[294] - The effective duration of the investment securities portfolio was 5.25 years, which is within the industry average[295] Liquidity and Commitments - Liquid assets totaled $280.8 million at December 31, 2025, representing 12% of total assets, an increase from $247.4 million or 11% in 2024[325] - Unused commitments to fund loans and lines of credit were $225.1 million at December 31, 2025, compared to $196.7 million in 2024[338] - The Bank has a liquidity cushion and conducts stress tests under various scenarios to ensure sufficient resources to meet liquidity needs[329]

Financial Reporting - VEON Ltd. filed its report under Form 20-F for the month of March 2026[1] - The press release issued on March 16, 2026, contains important financial information[3] - The report is signed by Sebastian Rice, Group General Counsel, indicating compliance with the Securities Exchange Act[6]

Company Operations - The company operates 37,590 towers across five African countries and two Latin American countries, serving approximately 647 million people in emerging markets [541]. - The company has a colocation rate of 1.46x, supporting 54,874 tenants as of December 31, 2025 [543]. - The company has entered into a share purchase agreement to sell a 51.0% stake in I-Systems, subject to regulatory approvals [545]. - The company agreed to sell its Latin American tower and fiber operations for an enterprise value of approximately $952 million, including cash consideration of BRL3,550 million (approximately $683 million) [546]. - The company has entered into BRL2,415 million (approximately $441 million) of foreign exchange derivative instruments to hedge components of the sale prices denominated in Brazilian Real [548]. - The company is undergoing a merger with MTN Group Limited, with each outstanding ordinary share being cancelled in exchange for $8.50 in cash per share [549]. Revenue and Financial Performance - The company’s revenue is categorized into organic, inorganic, and non-core segments, with organic revenue driven by colocation and lease amendments [552][553]. - Revenue for the full year ended December 31, 2025, was $126.8 million, a significant recovery from a loss of $1,644.2 million in 2024 [626]. - Adjusted EBITDA for 2025 was $1,012.3 million, compared to $928.4 million in 2024, indicating a positive growth trend [626]. - Revenue from continuing operations for the year ended December 31, 2025 was $1,582.0 million, an increase of 3.6% year-on-year, with organic revenue increasing by $155.0 million (10.1%) despite a 3.8% inorganic revenue headwind [644]. - Revenue from the top three MNO customers accounted for 98.9% of the company's consolidated revenue for the year ended December 31, 2025 [601]. - Revenue for Nigeria increased by 7.0% year-on-year to $1,068.8 million, driven by organic revenue growth of $126.2 million (12.6%) [671]. - Revenue for the SSA segment increased by 6.1% year-on-year to $513.2 million, despite a 2.6% inorganic revenue headwind from the disposal of operations in Rwanda [675]. - Revenue for the Latam segment increased by 5.2% year-on-year to $193.5 million, driven by organic growth of 9.7% [681]. Costs and Expenses - Diesel pricing is the largest single operating expense, significantly impacting operating costs, especially in Nigeria due to low power grid availability [599]. - Cost of sales decreased by $28.2 million, or 3.8%, to $705.4 million for the year ended December 31, 2025, primarily due to lower impairment charges and reductions in power generation costs [648]. - Administrative expenses decreased by $40.6 million, or 14.7%, to $234.8 million for the year ended December 31, 2025, driven by a net reversal of impairment of withholding tax receivables [653]. - The spend associated with decommissioning a site ranges from $2,700 to $40,000, which helps eliminate ongoing maintenance costs at decommissioned towers [580]. - Administrative expenses include costs related to acquisition efforts and new business initiatives, impacting overall profitability [633]. Operational Efficiency and Strategy - The company aims to reduce Scope 1 and Scope 2 emissions intensity of its tower portfolio by 2030, using 2021 emissions data as the baseline [597]. - The company is pursuing operational efficiencies through productivity enhancements and cost reductions to counterbalance macroeconomic headwinds, particularly in Nigeria [607]. - The company does not engage in speculative building and only constructs New Sites after securing long-term lease commitments from tenants [573]. - Acquisitions of tower portfolios lead to immediate increases in revenue and expand the company's footprint in existing and new markets [581]. Foreign Exchange and Financial Risks - The company’s operations are impacted by fluctuations in foreign exchange rates, particularly the Naira, which necessitates continual reassessment of strategic and operational plans [586]. - The company faces foreign exchange risks from currencies such as BRL, NGN, and ZAR, which could adversely affect cash flow and profits [610]. - The Naira exchange rate to the U.S. dollar was relatively stable in 2025, positively impacting revenue and segment Adjusted EBITDA in Q4 2025 by $28.8 million and $18.2 million, respectively [640]. - The appreciation of the Naira in Q4 2025 resulted in unrealized foreign exchange gains of $49.2 million on U.S. dollar-denominated intercompany loans [640]. Capital Expenditure and Liquidity - Total capital expenditure for the year ended December 31, 2025, was $246.4 million, a decrease of 3.7% from $255.9 million in 2024, primarily due to lower capital expenditure in the Latam segment [686]. - Total liquidity as of December 31, 2025, was $1,227.1 million, including unrestricted cash of $853.3 million [717]. - Cash and cash equivalents at the end of 2025 were $853.3 million, reflecting an increase from $578.0 million at the beginning of the year [722]. - The company plans to optimize its funding profile and explore opportunities in global capital markets for refinancing [720]. Discontinued Operations - The loss from discontinued operations in the Latam segment increased to $477.6 million in 2025, up from $164.2 million in 2024, mainly due to impairments of non-current assets [664]. - The company announced agreements to sell its 51.0% stake in I-Systems and its Latin American tower operations, classified as held for sale at December 31, 2025 [643]. - The impairment of goodwill related to discontinued operations was $87.9 million for the IHS Latam tower business [713].

Revenue and Performance - For the year ended December 31, 2025, total revenues increased to $502.5 million, up by $171.0 million or 51.6% compared to $331.5 million in 2024[237]. - The Railroad business accounted for 34% of total revenue, while the Power and Gas business contributed 36%, and Ports and Terminals contributed 19%[227]. - Adjusted EBITDA is utilized as the key performance measure, reflecting operational performance and resource allocation decisions[234]. - The Power revenues reached $156.2 million, marking a significant contribution as it was not present in the previous year[237]. - Total revenues increased by $171.0 million, primarily due to higher revenues in the Power and Gas and Jefferson Terminal segments[239]. - Adjusted EBITDA increased by $233.6 million, primarily due to the changes noted above[249]. - Adjusted EBITDA for 2025 was reported at $232.99 million, a significant increase from $40.25 million in 2024, reflecting the positive impact of the acquisition and operational improvements[276]. Expenses and Losses - Operating expenses rose to $299.6 million, an increase of $51.9 million or 20.9% from $247.7 million in 2024[237]. - Total expenses increased by $63.6 million, driven by higher operating expenses, general and administrative expenses, acquisition and transaction expenses, and depreciation and amortization[241]. - Acquisition and transaction expenses rose by $21.7 million, mainly due to increased consulting and legal fees related to the acquisition of GCM's interest in Long Ridge Energy & Power LLC[242]. - Depreciation and amortization increased by $53.1 million, reflecting the acquisition of 100% of Long Ridge in February 2025[243]. - Total expenses increased by $118.8 million, primarily due to a $60.2 million rise in operating expenses and a $54.2 million increase in depreciation and amortization expenses related to the same acquisition[274]. - Total expenses increased by $14.6 million to $98.3 million in 2025, driven by higher acquisition and transaction expenses and general and administrative expenses[286]. Net Income and Loss - Net loss attributable to stockholders before preferred stock dividends was $207.4 million, a decrease of $87.1 million or 29.6% from a loss of $294.5 million in 2024[237]. - Net income attributable to stockholders before preferred stock dividends was $109.82 million in 2025, a recovery from a loss of $29.20 million in 2024[272]. - Net loss attributable to stockholders in the Jefferson Terminal Segment was $46.0 million in 2025, an increase of $1.4 million from 2024[257]. - Net loss attributable to stockholders before series B preferred stock dividend was $30,765,000 for 2025, compared to $17,586,000 for 2024, an increase of $13,179,000[265]. - The net loss attributable to stockholders before preferred stock dividends was $259,238 in 2025, compared to a loss of $171,377 in 2024, reflecting a change of $87,861[284]. Assets and Liabilities - The company had total consolidated assets of $5.7 billion and redeemable preferred stock and equity of $944.0 million as of December 31, 2025[228]. - The company has significant debt obligations totaling $3.8 billion in principal and $1.3 billion in interest payments, with $1.6 billion of principal and $248.9 million of interest due within the next twelve months[305]. - Operating and finance lease obligations totaled $295.5 million as of December 31, 2025, with $12.2 million due within the next twelve months[306]. - Goodwill as of December 31, 2025, was recorded at $365.6 million across various segments, with annual impairment assessments conducted to ensure recoverability[312]. Cash Flow and Investments - Cash used for investments was $1.1 billion in 2025, compared to $118.1 million in 2024 and $147.1 million in 2023, indicating a substantial increase in investment activities[296]. - Net cash provided by financing activities increased by $1.2 billion in 2025, primarily due to an increase in proceeds from debt of $1.3 billion and the issuance of redeemable preferred stock of $1.0 billion[301]. - Net cash used in operating activities increased by $102.7 million in 2025, reflecting a decrease in net loss and various adjustments including an increase in asset impairment of $67.9 million[299]. Interest and Taxation - Interest expense increased by $143.8 million, attributed to an increase in average outstanding debt of approximately $1.7 billion[246]. - The benefit from income taxes increased by $6.6 million due to the partial release of the valuation allowance in connection with the acquisition of GCM's interest in Long Ridge Energy & Power LLC[244]. - The benefit from income taxes rose by $7.5 million, primarily due to the partial release of the valuation allowance associated with the acquisition[275]. - A hypothetical 100-basis point increase in variable interest rates would result in an increase of approximately $12.9 million in interest expense over the next 12 months[329]. Regulatory and Market Considerations - The company is monitoring regulatory reforms related to benchmark indices that could impact interest rates and financial instruments tied to variable interest rates[326]. - The expansion of refineries in the Beaumont/Port Arthur area is expected to increase demand for storage on the U.S. Gulf Coast[317]. - The company expects to continue investing in infrastructure sectors with high barriers to entry and stable cash flows[228].

Revenue and Income - 2025 revenue increased by 7% year-over-year to $614.9 million, up from $573.7 million in 2024[9] - Total revenue for 2025 was $614.85 million, an increase of 7.4% from $573.70 million in 2024[37] - 2025 net income was $5.1 million, a decrease from $7.8 million in 2024, impacted by an $18.5 million accrual for an arbitration judgment liability[11] - Net income for 2025 was $5.12 million, down from $7.81 million in 2024, reflecting a decrease of 34.5%[29] Profitability Metrics - Gross profit for 2025 rose by 30% to $105.6 million, with a gross profit margin of 17.2%, an increase of 300 basis points from 14.2% in 2024[10] - Adjusted EBITDA for 2025 increased by 42% to $56.4 million compared to $39.7 million in 2024[12] - Adjusted EBITDA for 2025 was $56.42 million, compared to $39.71 million in 2024, representing a 42.2% increase[35] - The company reported an Adjusted EBITDA margin of 9.2% for 2025, compared to 6.9% in 2024[35] - Adjusted gross profit for 2025 was $113.30 million, up from $91.44 million in 2024, reflecting a growth of 23.9%[37] Operating Expenses and Liabilities - Total operating expenses in 2025 were $72.1 million, up from $67.2 million in 2024, driven by higher legal services expenses[11] - Total liabilities increased to $118.61 million in 2025 from $96.59 million in 2024, marking a rise of 22.8%[26] Cash and Equivalents - Cash, cash equivalents, and cryptocurrencies as of December 31, 2025, totaled $76.6 million, significantly up from $31.0 million at the end of 2024[7] - Cash and cash equivalents at the end of 2025 were $65.63 million, up from $29.47 million at the end of 2024, indicating a significant increase of 122.5%[29] Special Items and Adjustments - The year ended December 31, 2025, includes an accrual of $18.5 million related to an arbitration ruling, a $1.9 million legal settlement, and a special bonus of $1.9 million[38] - The year ended December 31, 2024, includes a special performance bonus of $0.7 million and professional services fees[38] - The company incurred an unrealized loss on cryptocurrencies of $2.58 million in 2025[29] Market and Future Outlook - The company expects core business revenue in 2026 to decline by 30% to 40% due to regulatory uncertainties[13] - Bitcoin Depot acquired Kutt, a peer-to-peer social betting platform, marking its entry into the P2P social betting market[2] Quarterly Performance - Fourth quarter 2025 revenue was $116.0 million, down from $136.8 million in Q4 2024, primarily due to new state regulations[3] - Fourth quarter 2025 gross profit was $15.3 million, with a gross profit margin of 13.2%, down from 17.2% in Q4 2024[4]

Financial Performance - The company reported a net loss of $102.8 million, or $(3.70) per diluted share, for the year ended December 31, 2025, an increase in loss of $86.3 million from the previous year [122][123]. - Net sales decreased by $47.0 million, or 5.2%, to $861.3 million in 2025, with the Control Devices segment down 6.2% and Electronics segment down 7.0% [124][142]. - Operating loss increased significantly to $38.6 million in 2025 from a loss of $0.4 million in 2024, primarily due to lower sales levels and higher business realignment costs [152]. - Gross margin decreased to 19.9% in 2025 from 20.8% in 2024, with material costs as a percentage of net sales decreasing by 0.8% to 56.8% [148]. - Selling, general and administrative expenses increased by $8.1 million, primarily due to higher professional services and business realignment costs [128][142]. Segment Performance - The Control Devices segment's net sales decreased by $18.1 million due to declines in the North American automotive market and the China automotive market [125][142]. - The Electronics segment's net sales decreased by $39.6 million, primarily due to lower production volumes in North American and European commercial vehicle markets, partially offset by higher MirrorEye sales [126][143]. - Stoneridge Brazil segment net sales increased by 21.6% to $60.4 million, driven by higher OEM product sales [127][142]. - Total net sales decreased by $47.0 million (5.2%) from $908.3 million in 2024 to $861.3 million in 2025, with North America experiencing a decline of $54.8 million (12.3%) [144]. Cash and Debt Management - Cash and cash equivalents decreased to $66.3 million at December 31, 2025, down from $71.8 million in 2024, mainly due to repayments of Credit Facility borrowings [129]. - As of December 31, 2025, the Credit Facility had an outstanding balance of $180.9 million, with a maximum borrowing capacity reduced to $175.0 million effective January 30, 2026 [168]. - The Credit Facility borrowing capacity was reduced from $225.0 million to $175.0 million following the sale of the Control Devices business [172]. - The Company has approximately $94.1 million of undrawn commitments under the Credit Facility as of December 31, 2025, resulting in total undrawn commitments and cash balances of more than $160.3 million [181]. - The expiration date of the Credit Facility was extended from November 2, 2026, to July 1, 2027 [175]. Tax and Regulatory Matters - The provision for income tax expense was $47.4 million in 2025, resulting in an effective tax rate of (85.4)% [158]. - As of December 31, 2025, the valuation allowance related to deferred tax assets was $44,324 million in the United States and $15,630 million in several international jurisdictions [198]. - The company has accrued taxes of $5,869 million related to undistributed earnings from foreign subsidiaries in China and Estonia [199]. Market Outlook and Strategic Initiatives - The company expects continued expansion in Vision and Safety systems, including new product introductions like connected trailers and surround-view capabilities [130]. - The company anticipates a 6.0% increase in European and a 9.8% increase in North American commercial vehicle end market volumes in 2026 [133]. - The company plans to increase net design and development spending in 2026 to support quality improvement and next-generation product development [135]. Currency and Commodity Exposure - A 10.0% unidirectional change in currency exchange rates relative to the U.S. dollar would have changed income before income taxes for the year ended December 31, 2025, by approximately $3.5 million [211]. - The company is exposed to commodity price fluctuations related to purchases of copper, steel, zinc, and resins, which may impact cost recovery through pricing [212]. - The company has previously used foreign currency forward contracts to mitigate exposure to fluctuations in foreign currency exchange rates [210]. - The company is subject to translation risk due to significant operations in various countries, affecting the comparability of financial results [209]. Accounting and Compliance - The adoption of ASU No. 2023-09 will result in incremental disclosures in the company's financial statements starting in fiscal years after December 15, 2024 [200]. - The company is currently evaluating the impact of several recently issued accounting standards on its annual consolidated financial statements and disclosures [201][202][203][204][205][206][207]. - The company intends to maintain valuation allowances until it is more likely than not that deferred tax assets will be realized, influenced by economic conditions in automotive and commercial vehicle markets [198].

Loan Performance - As of December 31, 2025, total nonperforming loans decreased to $11.32 million from $22.96 million in 2024, representing a reduction of approximately 50.7%[75] - The allowance for credit losses (ACL) decreased by $2.8 million to $39.0 million at the end of 2025, with a coverage ratio of 344.6% for nonperforming loans, up from 182.0% in 2024[76][77] - Nonaccrual loans as a percentage of loans held for investment improved to 0.27% in 2025 from 0.56% in 2024[75] Loan Growth - Total loans held for investment increased to $4.07 billion in 2025, compared to $3.99 billion in 2024, marking a growth of approximately 1.9%[75] Liquidity and Funding - Total sources of liquidity amounted to $3.08 billion as of December 31, 2025, with $810.8 million outstanding[86] - The bank's maximum borrowing capacity with the FHLB was $1.7 billion, with $159.2 million outstanding in borrowings as of December 31, 2025[84] - The bank's primary source of funds is deposit gathering, supplemented by investment activities and net income[81] Capital Adequacy - The Bank was classified as "well capitalized" based on its actual capital position as of December 31, 2025, with Common Equity Tier 1 capital at $440,852 thousand, representing a ratio of 11.03%[115] - The Bank's Tier 1 capital to risk-weighted assets ratio was 13.06%, exceeding the minimum requirement of 6.00%[115] - Total capital to risk-weighted assets for the Bank was 14.01%, above the minimum requirement of 8.00%[115] - The Bank's actual capital ratios at December 31, 2025, indicate it is well above the minimum capital adequacy requirements, with a total capital amount of $558,435 thousand[115] - The Company has a conservation buffer of 2.5% for Common Equity Tier 1 capital to risk-weighted assets, which increases the required capital ratios[115] - The Bank is subject to restrictions on capital distributions if it fails to hold capital above the minimum ratios and the capital conservation buffer[115] Regulatory Compliance - The Community Reinvestment Act compliance examination in 2024 resulted in a "satisfactory" rating for the Bank, which is crucial for maintaining operational flexibility[122] - The Bank is subject to various federal and state consumer protection laws, and failure to comply may result in penalties or delays in obtaining regulatory approvals for mergers or acquisitions[131][133] - The CFPB has authority over depository institutions with $10 billion or more in assets, while smaller institutions are examined by federal banking regulators for consumer compliance[134] - The Bank's mortgage origination activities must comply with multiple regulations, including the ECOA, HMDA, RESPA, and HOEPA, which set standards for loan origination and prohibit discrimination[135][136] - The federal regulatory agencies require the Bank to maintain written policies for extensions of credit secured by real estate, including prudent underwriting standards and loan portfolio diversification[138] Interest Rate Risk Management - The Bank utilizes interest rate risk models and derivatives to manage exposure to interest rate movements, ensuring stability in interest income and expense[121] - The company's exposure to interest rate risk (IRR) is primarily from lending, investing, and deposit gathering activities, with no exposure to foreign exchange or commodity price risk[439] - The ALCO's income simulation model measures the impact of interest rate shifts on net interest income over 24-month and 60-month horizons, ensuring stability and adequacy of earnings[442] - At December 31, 2025, net interest income simulations indicated that exposure to changing interest rates remained within established tolerance levels[443] - The interest rate risk position shifted to more asset-sensitive due to additional floating rate loans and an increase in fully sensitive interest-bearing cash[445] - Projected net interest income would increase by 0.6% with a 100 basis point increase in interest rates, while a 100 basis point decrease would result in a 1.2% decrease[447] - The ALCO regularly reviews various interest rate shift scenarios, including changes in the yield curve and parallel shifts of up to 400 basis points[446] Cybersecurity and Risk Management - The Bank must notify its primary federal regulator of significant cybersecurity incidents within 36 hours, and ongoing rulemaking under CIRCIA will require reporting of significant cyber incidents within 72 hours[147][148] Competition and Market Position - The bank faces significant competition from larger financial institutions and fintech companies, impacting its market share and deposit gathering efforts[92][93] - The bank emphasizes community involvement and customer relationships as key competitive advantages in a highly competitive market[94] Deposit Insurance and Funding - The FDIC deposit insurance coverage limit is $250,000 per depositor, with no current circumstances leading to termination of the Bank's deposit insurance[124][125] - The DIF is funded by assessments on banks based on average consolidated total assets minus average tangible equity, with total base assessment rates for institutions insured for at least five years ranging from 2.5 to 32 basis points for banks with less than $10 billion in assets[126] - Brokered deposits are limited unless the bank is "well capitalized," with new FDIC rules effective April 1, 2021, having no material impact on the Bank[143]

Revenue Growth - Revenue grew 77% year-over-year to $46.8 million, driven by 105% growth in Security Solutions[2] - Total revenue for the year ended December 31, 2025, was $164.805 million, a 52.2% increase from $108.272 million in 2024[14] - Revenue for the year ended December 31, 2025, was $164,805 thousand, compared to $108,272 thousand in 2024, representing a year-over-year growth of 52.2%[25] - The company forecasts revenue for Q1 2026 to be between $44.0 million and $45.0 million, with a year-over-year growth of 44% to 47%[1] - Full-year revenue guidance for 2026 is projected to be between $187 million and $200 million, with a growth rate of 14% to 21%[1] Profitability Metrics - GAAP Gross Margin was 35.0%, while Cash Gross Margin was 41.9%, exceeding guidance[2] - Adjusted EBITDA increased $7.5 million year-over-year to $7.3 million, with an Adjusted EBITDA Margin of 15.6%[3] - Gross profit for the year ended December 31, 2025, was $61.017 million, compared to $34.429 million in 2024, reflecting a 77.0% increase[14] - Gross profit for the three months ended December 31, 2025, was $16,357 thousand, with a gross margin of 35.0%, compared to $10,618 thousand and a gross margin of 40.3% in 2024[24] - Cash gross profit for the year ended December 31, 2025, was $70,343 thousand, with a cash gross margin of 42.7%, compared to $47,335 thousand and a margin of 43.7% in 2024[24] Cash Flow - Cash Flow from Operations was $8.0 million, representing 17.1% of Revenue, and Free Cash Flow improved to $6.3 million or 13.4% of Revenue[3] - Cash flows from operating activities for the year ended December 31, 2025, were $30.182 million, compared to a cash outflow of $25.938 million in 2024[18] - Free cash flow for the three months ended December 31, 2025, was $6,270 thousand, compared to a negative free cash flow of $14,790 thousand in 2024, indicating a substantial improvement[25] - Operating cash flow margin for the three months ended December 31, 2025, was 17.1%, compared to a negative margin of 39.9% in 2024, indicating a positive turnaround[25] Expenses and Liabilities - The company approved a restructuring plan resulting in a $1.5 million charge, including $0.5 million in cost of sales[2] - Operating expenses for Q4 2025 were $34,865,000, compared to $20,545,000 in Q4 2024, representing a 69.3% increase[26] - Cash operating expenses (Non-GAAP) for the year ended December 2025 were $60,261,000, down from $68,216,000 in 2024, a reduction of 11.6%[26] - Total liabilities increased to $43.914 million as of December 31, 2025, compared to $31.098 million in 2024[16] - Total adjusted operating expenses for the year ended December 2025 were $55,477,000, down from $62,417,000 in 2024, a decrease of 11.5%[26] Impairments and Losses - The company recorded a $14.9 million non-cash goodwill impairment in Secure Networks[2] - The company reported a goodwill impairment of $14,916 thousand for the year ended December 31, 2025, which was not present in 2024, indicating a significant impact on financial results[23] - Net loss for the year ended December 31, 2025, was $36.546 million, an improvement from a net loss of $52.520 million in 2024[14] - For the three months ended December 31, 2025, the net loss was $16,311 thousand, compared to a net loss of $9,330 thousand for the same period in 2024, representing a year-over-year increase of 74.5%[20] - Operating loss for the year ended December 31, 2025, was $39.881 million, an improvement from $55.873 million in 2024[14] Shareholder Actions - Deployed $6.0 million to repurchase over one million shares at an average price of $5.78 per share in Q4 2025[2] - The company reported a weighted-average share count of 72.878 million for the year ended December 31, 2025[14] Research and Development - Research and development expenses for the year ended December 31, 2025, were $7.057 million, down from $8.442 million in 2024[14] Asset Management - Cash and cash equivalents as of December 31, 2025, were $53.180 million, slightly down from $54.578 million in 2024[16] - Total assets decreased to $139.864 million as of December 31, 2025, from $158.235 million in 2024[16] Depreciation and Amortization - Depreciation and amortization for the year ended December 2025 was $3,271,000, down from $5,463,000 in 2024, a decrease of 40.0%[26] - Capitalized software development costs for the year ended December 2025 were $8,055,000, compared to $11,262,000 in 2024, a decrease of 28.5%[26] - Impairment loss on intangible assets for the year ended December 2024 was $6,373,000, with no such loss recorded in 2025[26]

Financial Performance - The company incurred a net loss of $12.6 million and $13.0 million for the years ended December 31, 2025 and 2024, respectively, with an accumulated deficit of $333.6 million as of December 31, 2025 [263]. - The company has never generated commercial revenue and expects to continue incurring significant losses for the foreseeable future [263]. - As of December 31, 2025, the company had approximately $14.6 million in cash and cash equivalents, raising substantial doubt about its ability to continue as a going concern [268]. - The company’s financial condition and operating results may fluctuate significantly from quarter to quarter and year to year due to various factors [275]. - The company expects existing cash and cash equivalents, along with proceeds from a January 2026 private placement, to cover operating expenses and capital expenditures into Q1 2027 [277]. - Future capital requirements will depend on various factors, including the costs and results of clinical trials for product candidates APR-1051 and ATRN-119 [277]. - The company anticipates an increase in expenses related to planned operations and will finance cash needs through equity offerings, debt financings, and collaborations [278]. - The company may face dilution of stockholder ownership if additional capital is raised through equity or convertible debt securities [278]. Clinical Development Challenges - The company has paused further patient enrollment in certain clinical trials as it explores combination approaches for its product candidates [272]. - The company relies on third parties for conducting clinical trials, which may not perform satisfactorily, potentially affecting the company's operations [257]. - The company is substantially dependent on the success of its product candidates APR-1051 and ATRN-119, which are still in early stages of clinical development [256]. - The company may face challenges in establishing sales and marketing capabilities necessary for the commercialization of its product candidates [260]. - Patient enrollment in clinical trials is critical, and delays or difficulties in enrollment could significantly impact the company's ability to obtain necessary marketing approvals [312]. - The company is exploring combination approaches for ATRN-119, but current pauses in patient enrollment may hinder timely development [306]. - The company has limited experience in conducting clinical trials, which may affect the timely completion of pivotal trials for its product candidates [308]. - The design of clinical trials can significantly impact the results, and flaws may not be apparent until trials are advanced [324]. - The company may need to conduct additional clinical trials if initial results are negative or inconclusive, leading to increased costs and delays [336]. - The company may face challenges in recruiting suitable patients for trials, which could delay the approval process [335]. Regulatory and Compliance Risks - The company has never obtained marketing approval for any product candidate, and the approval process is expected to be expensive, time-consuming, and uncertain [260]. - Disruptions at regulatory agencies like the FDA could delay product development and approval processes, negatively impacting operations [289]. - Regulatory authorities may change approval requirements, potentially leading to narrower indications or additional post-marketing testing requirements [338]. - Ongoing regulatory requirements will govern the manufacturing, packaging, marketing, and distribution of approved products, with non-compliance risking withdrawal of approval [368]. - The company faces risks related to regulatory compliance and may be impacted by external factors such as public health situations that could affect the approval timeline [447]. Intellectual Property and Competition - The company’s patent portfolio includes method-of-use and formulation claims, but lacks composition of matter patents for its key product eprenetapopt, which may affect competitive positioning [401]. - The company faces risks related to intellectual property, including potential litigation and the need to defend patents against third-party challenges [400]. - The company may face significant costs and time commitments in defending its patents against challenges, which could distract from its core operations [418]. - The company may struggle to obtain necessary third-party intellectual property rights, which could hinder the development of its product candidates [421]. - The company may face significant damages for infringement if a court finds that its products infringe third-party patents, which could include treble damages for willful infringement [433]. - The company may face claims regarding the wrongful use of trade secrets by employees or consultants, which could lead to significant legal expenses and distract management [440]. - The company may not be able to protect its intellectual property rights adequately, which could lead to challenges in building brand recognition and market identity [446]. Market and Economic Environment - The political and economic environment in the U.S. could materially impact the company's operations and financial performance, particularly due to regulatory changes [291]. - The company is currently operating in a period of global economic uncertainty, which may adversely affect its business and financial condition [280]. - Inflation and rising interest rates have led to declines in the trading value of government securities, potentially impacting liquidity for financial institutions [296]. - The company may face challenges in accessing adequate funding sources due to instability in the financial services industry [297]. - The company faces substantial competition in the cancer drug sector, with competitors having greater financial resources and expertise [349]. - The commercial opportunity could be reduced if competitors develop safer, more effective, or less expensive drugs [351]. Commercialization and Sales Strategy - The company lacks a sales and marketing infrastructure and experience in selling pharmaceutical drugs, which could hinder commercialization efforts [359]. - Establishing sales and marketing capabilities or entering into agreements with third parties is critical for successful commercialization of approved product candidates [358][362]. - Delays in the commercial launch of product candidates could result in unnecessary expenses and lost investments [361]. - The company may not achieve sufficient market acceptance for its product candidates, impacting revenue generation and profitability [346]. - The company plans to build commercial infrastructure to market its product candidates directly, but may still enter strategic collaborations with larger pharmaceutical companies [386].

Financial Performance - Cash and cash equivalents increased to CAD 61,082,045 in 2025 from CAD 32,057,647 in 2024, representing an increase of 90.5%[10] - Total assets rose to CAD 143,438,689 in 2025, up from CAD 106,253,494 in 2024, marking a growth of 35%[10] - Operating loss for the year was CAD 37,171,127 in 2025, compared to CAD 25,955,653 in 2024, reflecting an increase of 43.5%[12] - Loss and comprehensive loss for the year amounted to CAD 31,738,497 in 2025, up from CAD 20,649,147 in 2024, indicating a rise of 53.6%[12] - Cash used in operating activities was CAD 32,281,037 in 2025, compared to CAD 21,144,413 in 2024, an increase of 52.6%[14] - The company reported a basic and diluted loss per common share of CAD 0.38 in 2025, compared to CAD 0.28 in 2024[12] Exploration and Evaluation - Exploration and evaluation expenses increased to CAD 25,198,442 in 2025 from CAD 17,875,317 in 2024, a growth of 40.6%[12] - The company’s exploration and evaluation assets are subject to impairment testing based on technical feasibility and commercial viability[26] - Management assesses the recoverability of exploration and evaluation assets, which are not intended to reflect present or future values[36] - Exploration and evaluation assets increased to $80,356,492 as of December 31, 2025, from $71,329,535 in 2024[64] - The company recognized flow-through premium liability additions of $8,087,400 during the year ended December 31, 2025[92] Capital and Share Issuance - Share capital increased to CAD 285,981,680 in 2025 from CAD 224,362,471 in 2024, an increase of 27.4%[13] - The company issued 5,351,500 common shares in 2025, raising CAD 30,138,300[13] - The Company issued 269,806 common shares for RSUs and 252,062 shares for stock options, raising $684,805 in proceeds during the year ended December 31, 2025[76][77] - The Company closed a bought deal financing on October 23, 2025, raising gross proceeds of $33,973,000 by issuing 4,646,000 shares[78] - The Company completed the acquisition of the Kinskuch Property by issuing 1,351,963 common shares valued at $5,178,018[69] - The Company issued 486,072 common shares valued at $2,245,653 for the acquisition of four properties from MTB Metals Corp.[71] - The Company has a total of 605,636 RSUs outstanding as of December 31, 2025, after granting and settling during the year[87] - The Company has authorized an Omnibus Plan allowing for the issuance of stock options up to 10% of the issued and outstanding common shares[88] - As of December 31, 2025, the company had 2,694,876 outstanding stock options with a weighted average exercise price of $3.36[90] - The total share-based payments expense recognized for the year ended December 31, 2025, was $1,085,228, down from $1,461,500 in 2024[90] Liabilities and Working Capital - The total liabilities increased to CAD 11,010,736 in 2025 from CAD 4,399,889 in 2024, a rise of 150.8%[10] - As of December 31, 2025, the company has sufficient working capital to maintain operations for the next fiscal year[16] - The company had cash and cash equivalents of $61,082,045 to settle current liabilities of $4,005,783 as of December 31, 2025[105] Tax and Deferred Assets - The expected income tax recovery for the year ended December 31, 2025, was $8,569,000, reflecting the loss incurred[110] - The Company reported unrecognized deferred tax assets totaling $26,937,000 as of December 31, 2025, an increase from $23,251,000 in 2024, reflecting a growth of approximately 11.5%[111] - Non-capital losses available for future periods increased to $60,886,000 in 2025 from $50,453,000 in 2024, representing a growth of about 20.4%[111] - The total deferred tax assets for the Company reached $26,937,000 in 2025, up from $23,251,000 in 2024, marking an increase of about 16.5%[111] Mergers and Acquisitions - Dolly Varden Silver Corporation completed a merger agreement with Contango ORE, Inc, where Contango will acquire all outstanding shares of Dolly Varden at an exchange ratio of 0.1652 shares of Contango for each Dolly Varden share[18] - The company acquired 100% of Homestake Resource Corporation on February 25, 2022, enhancing its mineral property interests in British Columbia[16] - The Company completed the acquisition of a 100% interest in the Homestake Ridge property for $50,000 annual advanced minimum royalty obligations and will issue approximately 17,300 shares to NSR holders after commercial production begins[66] - The Company acquired the Big Bulk property by issuing 68,750 common shares valued at $222,750 to Libero Copper & Gold Corporation[67] Financial Reporting and Standards - The company’s consolidated financial statements are prepared in accordance with IFRS Accounting Standards effective for the year ended December 31, 2025[19] - The company is currently assessing the impact of IFRS 18, effective January 1, 2027, on its consolidated financial statements[58] - The company’s financial assets measured at amortized cost are subject to the expected credit loss model[47] - The company recognizes decommissioning liabilities based on expected future cash flows, which are discounted to present value, reflecting current market assessments[31] Other Financial Metrics - The company incurred total related party transactions amounting to $3,706,339 for the year ended December 31, 2025, compared to $4,419,136 in 2024[97] - The company has no capital restrictions other than anti-dilution rights in favor of Hecla and Fury, both holding over 10% interest[96] - The company is dependent on capital markets for operating capital, with no changes to its capital management approach during the year ended December 31, 2025[96] - Share issuance costs increased to $5,529,000 in 2025 from $3,454,000 in 2024, reflecting a significant rise of about 60%[111] - The investment tax credit remained stable at $711,000 with no expiry date as of December 31, 2025[111] - Property and equipment temporary differences rose to $1,096,000 in 2025 from $905,000 in 2024, indicating an increase of approximately 21%[111] - The Company has no net deferred tax assets recorded as of December 31, 2025, consistent with the previous year[111]