For the quarterly period ended June 30, 2025 or ◻ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File Number: 0-24649 REPUBLIC BANCORP, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) (I.R.S. Em ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 28, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-13057 Ralph Lauren Corporation (Exact name of registrant as specified in its charter) Delaware 13-2622036 Indicate by check mark whether the registrant has submit ...

NEWS RELEASE Sempra Reports Second-Quarter 2025 Results SAN DIEGO, Aug. 7, 2025 — Sempra (NYSE: SRE) today reported second-quarter 2025 earnings, prepared in accordance with Generally Accepted Accounting Principles (GAAP), of $461 million or $0.71 per diluted share, compared to second-quarter 2024 GAAP earnings of $713 million or $1.12 per diluted share. On an adjusted basis, second-quarter 2025 earnings were $583 million or $0.89 per diluted share, compared to $567 million or $0.89 per diluted share in 202 ...

[Part I - Financial Information](index=4&type=section&id=Part%20I%20-%20FINANCIAL%20INFORMATION) This section presents the company's unaudited consolidated financial statements, management's analysis of financial condition and operations, market risk disclosures, and internal controls for the period ended June 30, 2025 [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company's unaudited consolidated financial statements for Q2 2025 show a decrease in total assets and revenue, offset by increased net income and stable shareholders' equity Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $345,721 | $611,639 | | Goodwill & Intangibles, net | $1,736,910 | $1,753,790 | | **Total Assets** | **$2,535,034** | **$2,831,036** | | **Total Current Liabilities** | $366,869 | $625,516 | | Long-term Debt | $1,433,459 | $1,466,021 | | **Total Liabilities** | **$1,896,366** | **$2,210,118** | | **Total Shareholders' Equity** | **$638,668** | **$620,918** | Consolidated Statements of Comprehensive Income Highlights (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | $521,262 | $537,816 | $1,057,733 | $1,072,770 | | Gross Profit | $279,264 | $288,790 | $560,311 | $572,327 | | Operating Income | $60,791 | $59,309 | $108,859 | $103,530 | | **Net Income** | $22,422 | $20,497 | $36,469 | $31,327 | | **Diluted EPS** | $0.50 | $0.46 | $0.80 | $0.70 | Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $101,374 | $66,222 | | Net cash used by investing activities | ($44,275) | ($43,938) | | Net cash used by financing activities | ($326,257) | ($398,609) | | **Net change in cash & equivalents** | **($267,674)** | **($380,029)** | [Note 2: New Accounting Pronouncements](index=9&type=section&id=Note%202%3A%20New%20Accounting%20Pronouncements) The company is evaluating the impact of new Accounting Standards Updates related to income tax, expense disaggregation, and credit losses, effective in future periods - The company is currently evaluating the potential impact of several new Accounting Standards Updates (ASUs) related to income tax disclosures (ASU 2023-09), disaggregation of income statement expenses (ASU 2024-03), and measurement of credit losses (ASU 2025-05), with these standards effective in future periods (2025, 2027, and 2026, respectively)[18](index=18&type=chunk)[19](index=19&type=chunk)[20](index=20&type=chunk) [Note 6: Acquisition and Divestitures](index=15&type=section&id=Note%206%3A%20Acquisition%20and%20Divestitures) The company acquired JPMorgan Chase Bank's CheckMatch business for $25 million and completed the exit of its U.S. and Canadian payroll services business in 2024 - On August 6, 2025, the company acquired certain assets of JPMorgan Chase Bank's CheckMatch electronic check conveyance service business for **$25 million in cash**, intended to enhance the market position and scale of the B2B Payments segment[31](index=31&type=chunk) - The company substantially completed the exit of its U.S. and Canadian payroll and human resources services business in 2024, resulting in a gain of **$23.0 million** in the first six months of 2024, with no corresponding gain in 2025[33](index=33&type=chunk)[34](index=34&type=chunk) [Note 8: Restructuring and Integration Expense](index=16&type=section&id=Note%208%3A%20Restructuring%20and%20Integration%20Expense) The company's multi-year 'North Star program' aims to accelerate EBITDA growth and reduce debt, incurring $108 million in expenses to date - The company is actively pursuing its "North Star program," a multi-year plan to accelerate EBITDA growth, increase cash flow, and reduce debt, involving organizational redesign, process automation, and consolidating back-office functions[39](index=39&type=chunk) Restructuring and Integration Expense (in thousands) | Period | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total Expense** | $4,236 | $11,029 | $12,656 | $25,766 | - To date, approximately **$108 million** in expenses have been incurred for the North Star program, with an additional **$5 million** expected in 2025, and the majority of associated employee reductions are expected to be completed by early 2026[39](index=39&type=chunk)[41](index=41&type=chunk) [Note 11: Debt](index=18&type=section&id=Note%2011%3A%20Debt) The company's total principal debt was $1.49 billion as of June 30, 2025, with compliance across all debt covenants and $390.1 million available under its revolving credit facility Debt Composition (in thousands) | Debt Instrument | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Senior secured term loan facility | $480,167 | $500,000 | | Senior unsecured notes | $475,000 | $475,000 | | Senior secured notes | $450,000 | $450,000 | | **Total Principal Amount** | **$1,487,667** | **$1,521,917** | - As of June 30, 2025, the company was in compliance with all debt covenants, which include maintaining specific consolidated total leverage, secured leverage, and interest coverage ratios[50](index=50&type=chunk)[51](index=51&type=chunk) - The company had **$390.1 million** available for borrowing under its **$400 million** revolving credit facility as of June 30, 2025[53](index=53&type=chunk) [Note 13: Business Segment Information](index=21&type=section&id=Note%2013%3A%20Business%20Segment%20Information) The company operates four reportable segments—Merchant Services, B2B Payments, Data Solutions, and Print—with performance evaluated based on adjusted EBITDA - The company operates four reportable segments: Merchant Services, B2B Payments, Data Solutions, and Print, with performance evaluated by the Chief Operating Decision Maker (CODM) based on adjusted EBITDA[66](index=66&type=chunk)[68](index=68&type=chunk)[70](index=70&type=chunk) Segment Revenue (Six Months Ended June 30, in thousands) | Segment | 2025 | 2024 | | :--- | :--- | :--- | | Merchant Services | $199,173 | $195,004 | | B2B Payments | $141,137 | $139,648 | | Data Solutions | $145,056 | $117,104 | | Print | $572,351 | $612,079 | | **Total Reportable Segments** | **$1,057,717** | **$1,063,835** | Segment Adjusted EBITDA (Six Months Ended June 30, in thousands) | Segment | 2025 | 2024 | | :--- | :--- | :--- | | Merchant Services | $43,115 | $40,625 | | B2B Payments | $28,937 | $27,273 | | Data Solutions | $40,060 | $30,665 | | Print | $181,186 | $184,819 | | **Total Reportable Segments** | **$293,298** | **$283,382** | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes H1 2025 results to North Star initiatives, showing decreased revenue but increased net income and adjusted EBITDA, with strong liquidity [Executive Overview](index=25&type=section&id=Executive%20Overview) The company's strategy, supported by the 'North Star program,' focuses on growth investments to accelerate profit growth, increase cash flow, and reduce debt - The company's strategy is focused on growth investments to drive scale and accelerate profit growth faster than revenue growth, supported by the "North Star program" which aims to enhance shareholder value by accelerating adjusted EBITDA growth, increasing cash flow, reducing debt, and improving the leverage ratio[81](index=81&type=chunk) Financial Highlights (First Half 2025 vs. First Half 2024) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Consolidated Revenue | $1.06 billion | $1.07 billion | ($15 million) | | Net Income | $36 million | $31 million | +$5 million | | Adjusted EBITDA | $207 million | $204 million | +$3 million | | Adjusted EBITDA Margin | 19.5% | 19.0% | +0.5 pts | | Net Cash from Operations | $101 million | $66 million | +$35 million | | Free Cash Flow | $52 million | $18 million | +$34 million | - The company is actively monitoring market conditions, including interest rates (**62% of debt is fixed-rate**), inflation (mitigated by price increases), and trends in consumer spending, which has shown some softness in discretionary categories[86](index=86&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk) [Consolidated Results of Operations](index=27&type=section&id=Consolidated%20Results%20of%20Operations) H1 2025 revenue decreased due to business exits and secular declines, while SG&A expenses decreased, and the effective income tax rate improved - Total revenue for H1 2025 decreased by **1.4%** YoY, driven by business exits (**$9 million** impact), soft demand for promotional products, and secular declines in checks and forms, partially offset by strong demand in data-driven marketing services, which grew by **$28 million**[93](index=93&type=chunk)[94](index=94&type=chunk) - SG&A expense decreased by **6.0%** in H1 2025 due to cost management actions, workforce adjustments, lower amortization, and a **$6 million** decrease in bad debt expense[100](index=100&type=chunk) - The effective income tax rate for H1 2025 decreased to **28.4%** from **33.7%** in H1 2024, benefiting from lower tax impacts from foreign operations and non-deductible compensation[106](index=106&type=chunk) Reconciliation of Net Income to Adjusted EBITDA (Six Months Ended June 30, in thousands) | Line Item | 2025 | 2024 | | :--- | :--- | :--- | | Net income | $36,469 | $31,327 | | Adjustments (Depreciation, Amortization, Interest, Taxes, etc.) | $170,163 | $172,517 | | **Adjusted EBITDA** | **$206,632** | **$203,844** | [Segment Results](index=33&type=section&id=Segment%20Results) Merchant Services, B2B Payments, and Data Solutions segments showed revenue and adjusted EBITDA margin growth, while Print revenue declined but improved its margin - **Merchant Services:** H1 2025 revenue grew **2.1%** to **$199.2 million**, and adjusted EBITDA margin improved to **21.6%** from **20.8%**, driven by pricing actions and volume growth from government and banking clients[123](index=123&type=chunk) - **B2B Payments:** H1 2025 revenue increased **1.1%** to **$141.1 million**, with adjusted EBITDA margin rising to **20.5%** from **19.5%**, due to new client onboarding and price increases[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) - **Data Solutions:** H1 2025 revenue saw strong growth of **23.9%** to **$145.1 million**, and adjusted EBITDA margin expanded to **27.6%** from **26.2%**, fueled by high demand for customer acquisition marketing from financial institutions[128](index=128&type=chunk) - **Print:** H1 2025 revenue declined **6.5%** to **$572.4 million** due to softer demand for promotional products and secular declines in checks, however, adjusted EBITDA margin increased to **31.7%** from **30.2%** due to pricing actions, cost management, and lower bad debt expense[130](index=130&type=chunk)[131](index=131&type=chunk)[132](index=132&type=chunk) [Cash Flows, Liquidity, and Capital Resources](index=35&type=section&id=Cash%20Flows%20and%20Liquidity%20and%20Capital%20Resources) Net cash from operating activities and free cash flow significantly increased in H1 2025, with a stable capital structure and available liquidity - Net cash from operating activities increased by **$35 million** in H1 2025 to **$101.4 million**, driven by pricing and cost actions, a **$15 million** reduction in employee bonuses, and lower restructuring spend[134](index=134&type=chunk) - Free cash flow for H1 2025 was **$52.1 million**, a significant increase from **$17.6 million** in H1 2024[134](index=134&type=chunk) Capital Structure (in thousands) | Component | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Fixed Interest Rate Debt | $925,000 | $925,000 | | Floating Interest Rate Debt | $562,667 | $596,917 | | **Total Debt Principal** | **$1,487,667** | **$1,521,917** | | Shareholders' Equity | $638,668 | $620,918 | | **Total Capital** | **$2,126,335** | **$2,142,835** | [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces interest rate risk from variable-rate debt, with a 1% change impacting interest expense by $3 million, while foreign currency risk is minimal - The company is exposed to interest rate risk from its variable-rate debt, where a one percentage point change in interest rates would result in a **$3 million** change in interest expense for the rest of the year as of June 30, 2025[145](index=145&type=chunk) - Foreign currency exchange rate risk is primarily related to Canadian dollar operations but is not considered material to earnings or cash flows[146](index=146&type=chunk) [Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective[147](index=147&type=chunk) - No material changes to internal control over financial reporting were identified during the quarter ended June 30, 2025[148](index=148&type=chunk) [Part II - Other Information](index=38&type=section&id=Part%20II%20-%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity security sales, and other disclosures for the reporting period [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company maintains adequate reserves for legal claims and does not anticipate any material impact on its financial position or results from current litigation - The company believes that recorded reserves for legal matters are adequate and does not expect any currently identified claims to have a material impact on its financial condition or results of operations[149](index=149&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) No significant changes to the company's risk factors have occurred since the Annual Report on Form 10-K for December 31, 2024 - No significant changes to the risk factors disclosed in the 2024 Form 10-K have occurred[150](index=150&type=chunk) [Unregistered Sales of Equity Securities and Issuer Purchases of Equity Securities](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company did not repurchase shares in Q2 2025, with $287 million remaining under its share repurchase authorization - No shares were repurchased in Q2 2025, and the company has **$287 million** remaining under its share repurchase authorization as of June 30, 2025[151](index=151&type=chunk) [Other Information](index=40&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the second quarter of 2025 - No directors or officers adopted or terminated a Rule 10b5-1 trading plan during the second quarter of 2025[154](index=154&type=chunk) [Signatures](index=41&type=section&id=Signatures) The report was duly signed on August 7, 2025, by the company's President, CEO, CFO, and Chief Accounting Officer

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Delaware 46-5706863 Identification Number) 2450 N Street N.W. Washington, D.C. 20037 (Address of Principal Executive Offices and Zip Code) (202) 295-4200 (Registrant's Telephone Numbe ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 28, 2025 ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File Number: 1-14222 SUBURBAN PROPANE PARTNERS, L.P. (Exact name of registrant as specified in its charter) (State or other jurisdiction of (I.R.S. Employer Delaware 22-341035 ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly period ended June 30, 2025 Commission file number 001-35296 FARMERS NATIONAL BANC CORP. (Exact name of registrant as specified in its charter) OHIO 34-1371693 (State or other jurisdiction of incorporation or or ...

[PART I FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents Chevron's comprehensive financial information, including consolidated statements, management's analysis, market risk disclosures, and internal controls [Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents Chevron's consolidated financial statements, including income, balance sheet, and cash flow, highlighting a decrease in net income and total assets for the first half of 2025 [Consolidated Statement of Income](index=4&type=section&id=Consolidated%20Statement%20of%20Income) Chevron reported a significant decrease in net income and diluted EPS for Q2 and the first six months of 2025, primarily due to lower revenues Consolidated Statement of Income Highlights (in Millions, except per-share amounts) | Metric | Q2 2025 | Q2 2024 | Change | Six Months 2025 | Six Months 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Revenues and Other Income** | $44,822 | $51,181 | -12.4% | $92,432 | $99,897 | -7.5% | | **Net Income Attributable to Chevron** | $2,490 | $4,434 | -43.8% | $5,990 | $9,935 | -39.7% | | **Diluted EPS** | $1.45 | $2.43 | -40.3% | $3.45 | $5.40 | -36.1% | [Consolidated Balance Sheet](index=6&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2025, Chevron's total assets and stockholders' equity decreased, primarily due to reduced cash and share repurchases, while total liabilities remained stable Consolidated Balance Sheet Highlights (in Millions) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $34,691 | $40,911 | | **Total Assets** | $250,820 | $256,938 | | **Total Current Liabilities** | $34,827 | $38,558 | | **Long-Term Debt** | $23,276 | $20,135 | | **Total Liabilities** | $103,562 | $103,781 | | **Total Chevron Stockholders' Equity** | $146,417 | $152,318 | [Consolidated Statement of Cash Flows](index=7&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) Net cash from operations increased slightly for the first half of 2025, while investing activities saw higher outflows due to the Hess acquisition, and financing outflows decreased Consolidated Statement of Cash Flows Highlights (Six Months Ended June 30, in Millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | **Net Cash Provided by Operating Activities** | $13,765 | $13,123 | | **Net Cash Used for Investing Activities** | ($9,050) | ($7,910) | | **Net Cash Used for Financing Activities** | ($7,649) | ($9,428) | | **Net Change in Cash** | ($2,887) | ($4,310) | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes reveal significant decreases in Upstream earnings, ongoing litigation, the completion of the Hess acquisition, and the issuance of new long-term debt - On July 18, 2025, the company completed the acquisition of Hess Corporation for an aggregate purchase price of approximately **$48 billion**, including assumed debt of **$8.8 billion**[101](index=101&type=chunk)[102](index=102&type=chunk) - The company is a defendant in **33 climate change-related lawsuits** across the U.S. and **37 coastal erosion lawsuits** in Louisiana, with a **$131 million** accrual for one case despite plans to appeal[59](index=59&type=chunk)[60](index=60&type=chunk) - In Q1 2025, the company issued **$5.5 billion** in new long-term debt, with maturities ranging from 2027 to 2035[99](index=99&type=chunk)[100](index=100&type=chunk) Earnings by Segment (Six Months Ended June 30, in Millions) | Segment | 2025 | 2024 | | :--- | :--- | :--- | | **Upstream** | $6,485 | $9,709 | | **Downstream** | $1,062 | $1,380 | | **All Other** | ($1,557) | ($1,154) | | **Net Income Attributable to Chevron** | **$5,990** | **$9,935** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the decline in Q2 2025 earnings driven by Upstream factors, partially offset by Downstream gains, while highlighting strategic initiatives, a strong financial position, and capital management [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Q2 2025 saw a significant decline in Upstream earnings due to lower prices and affiliate contributions, while Downstream earnings improved, and 'All Other' charges increased Upstream Earnings (Q2 2025 vs Q2 2024, in Millions) | Segment | Q2 2025 Earnings | Q2 2024 Earnings | Key Drivers | | :--- | :--- | :--- | :--- | | **U.S. Upstream** | $1,418 | $2,161 | Lower liquids realizations (-$1.0B), partly offset by higher sales volumes (+$380M) | | **International Upstream** | $1,309 | $2,309 | Lower affiliate earnings at TCO (-$550M), lower liftings (-$320M), and lower liquids realizations (-$250M) | Downstream Earnings (Q2 2025 vs Q2 2024, in Millions) | Segment | Q2 2025 Earnings | Q2 2024 Earnings | Key Drivers | | :--- | :--- | :--- | :--- | | **U.S. Downstream** | $404 | $280 | Higher refined product margins (+$140M) and lower opex (+$100M), partly offset by lower CPChem earnings (-$150M) | | **International Downstream** | $333 | $317 | Higher refined product margins (+$190M), offset by unfavorable tax impacts (-$70M) and currency effects (-$101M) | - Net charges for 'All Other' increased by **$341 million** in Q2 2025 compared to Q2 2024, primarily due to an unfavorable fair market valuation adjustment for Hess shares, higher interest expense, and pension curtailment costs[170](index=170&type=chunk) [Liquidity and Capital Resources](index=43&type=section&id=Liquidity%20and%20Capital%20Resources) Chevron's liquidity includes $4.1 billion in cash, with total debt increasing to $29.5 billion, while the company generated strong operating cash flow, paid dividends, and continued share repurchases Key Financial Ratios and Metrics | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Debt** | $29.5 Billion | $24.5 Billion | | **Net Debt Ratio** | 14.8% | 10.4% | | **Free Cash Flow (H1)** | $6.1 Billion | $5.1 Billion (H1 2024) | - Capital expenditures for the first six months of 2025 were **$7.6 billion**, down from **$8.1 billion** in the same period of 2024[203](index=203&type=chunk) - The company repurchased **18.6 million shares** for **$2.6 billion** in Q2 2025 and expects to repurchase **$2.5-$3.0 billion** in Q3 2025[199](index=199&type=chunk) - Dividends of **$5.9 billion** were paid to common stockholders during the first six months of 2025, and a quarterly dividend of **$1.71 per share** was declared for Q3 2025[192](index=192&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=46&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes in its market risk disclosures for the six months ended June 30, 2025, compared to the information provided in its 2024 Annual Report on Form 10-K - Information about market risks for the six months ended June 30, 2025, does not differ materially from that discussed in Chevron's 2024 Annual Report on Form 10-K[207](index=207&type=chunk) [Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[208](index=208&type=chunk) - There were no material changes in the company's internal control over financial reporting during the quarter ended June 30, 2025[209](index=209&type=chunk) [PART II OTHER INFORMATION](index=47&type=section&id=PART%20II%20OTHER%20INFORMATION) This section details legal proceedings, new risk factors, equity security sales, and other general corporate information [Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) Chevron reports a new legal proceeding from the ECMC with a potential $1.0 million civil penalty, in addition to ongoing climate change and coastal erosion lawsuits - On June 26, 2025, the Colorado Energy & Carbon Management Commission (ECMC) issued a notice of alleged violations following a well control incident, which may result in a civil penalty of **$1.0 million or more**[212](index=212&type=chunk) - The report references Note 11 for details on other significant legal proceedings, including climate change and Louisiana coastal lawsuits[212](index=212&type=chunk) [Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) A new risk factor highlights the potential failure to successfully integrate the Hess acquisition and realize anticipated benefits, which could negatively impact financial results - A new risk factor has been added concerning the Hess acquisition, which closed in July 2025[214](index=214&type=chunk) - Key risks include the potential failure to successfully integrate Hess and realize anticipated benefits, such as cost synergies and production growth, which could disrupt plans and negatively affect financial results[214](index=214&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=47&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, Chevron repurchased 18.6 million shares for $2.6 billion as part of its $75 billion stock repurchase program, with $42.1 billion remaining authorized Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 11,783,184 | $140.41 | | May 2025 | 6,837,101 | $137.88 | | June 2025 | 635 | $144.01 | | **Total** | **18,620,920** | **$139.48** | - As of the end of Q2 2025, approximately **$42.1 billion** remained authorized for repurchase under the 2023 Program[216](index=216&type=chunk) [Other Information](index=48&type=section&id=Item%205.%20Other%20Information) The company reports that during the three months ended June 30, 2025, none of its directors or executive officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No directors or executive officers adopted, modified, or terminated a Rule 10b5-1 trading plan during the second quarter of 2025[217](index=217&type=chunk) [Exhibits](index=48&type=section&id=Item%206.%20Exhibits) This section lists filed exhibits, including the Restated Certificate of Incorporation, CEO and CFO certifications, and Interactive Data Files (Inline XBRL) - Filed exhibits include CEO and CFO certifications under Sarbanes-Oxley rules[218](index=218&type=chunk) - The report includes Interactive Data Files (Inline XBRL) as Exhibit 101[218](index=218&type=chunk)

[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section provides the unaudited consolidated financial information for Packaging Corporation of America [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20FINANCIAL%20STATEMENTS) This section presents PCA's unaudited consolidated financial statements, including income, balance sheets, cash flows, and equity changes, with detailed notes [Consolidated Statements of Income and Comprehensive Income](index=3&type=section&id=Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) This section presents the company's consolidated income and comprehensive income statements, detailing financial performance metrics Consolidated Statements of Income (Three Months Ended June 30) | Metric | 2025 (Millions $) | 2024 (Millions $) | Change ($M) | Change (%) | | :-------------------------------- | :---------------- | :---------------- | :---------- | :--------- | | Net sales | 2,171.3 | 2,075.3 | 96.0 | 4.6% | | Gross profit | 483.0 | 437.7 | 45.3 | 10.4% | | Income from operations | 333.7 | 276.0 | 57.7 | 20.9% | | Net income | 241.5 | 198.9 | 42.6 | 21.4% | | Basic EPS | 2.68 | 2.22 | 0.46 | 20.7% | | Diluted EPS | 2.67 | 2.21 | 0.46 | 20.8% | | Dividends declared per common share | 1.25 | 1.25 | 0.00 | 0.0% | Consolidated Statements of Income (Six Months Ended June 30) | Metric | 2025 (Millions $) | 2024 (Millions $) | Change ($M) | Change (%) | | :-------------------------------- | :---------------- | :---------------- | :---------- | :--------- | | Net sales | 4,312.3 | 4,054.8 | 257.5 | 6.4% | | Gross profit | 937.8 | 808.1 | 129.7 | 16.1% | | Income from operations | 614.0 | 472.0 | 142.0 | 30.1% | | Net income | 445.3 | 345.9 | 99.4 | 28.7% | | Basic EPS | 4.95 | 3.86 | 1.09 | 28.2% | | Diluted EPS | 4.93 | 3.84 | 1.09 | 28.4% | | Dividends declared per common share | 2.50 | 2.50 | 0.00 | 0.0% | [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific dates Consolidated Balance Sheet (As of June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (Millions $) | December 31, 2024 (Millions $) | Change ($M) | Change (%) | | :-------------------------------- | :------------------------- | :--------------------------- | :---------- | :--------- | | Total current assets | 3,336.6 | 3,233.0 | 103.6 | 3.2% | | Total assets | 9,041.2 | 8,833.2 | 208.0 | 2.4% | | Total current liabilities | 943.0 | 1,001.6 | (58.6) | -5.8% | | Total long-term liabilities | 3,466.1 | 3,427.6 | 38.5 | 1.1% | | Total stockholders' equity | 4,632.1 | 4,404.0 | 228.1 | 5.2% | | Total liabilities and stockholders' equity | 9,041.2 | 8,833.2 | 208.0 | 2.4% | [Consolidated Statements of Cash Flows](index=5&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section outlines the company's cash inflows and outflows from operating, investing, and financing activities Consolidated Statements of Cash Flows (Six Months Ended June 30) | Metric | 2025 (Millions $) | 2024 (Millions $) | Change ($M) | Change (%) | | :-------------------------------- | :---------------- | :---------------- | :---------- | :--------- | | Net cash provided by operating activities | 638.7 | 538.7 | 100.0 | 18.6% | | Net cash used for investing activities | (287.0) | (323.8) | 36.8 | -11.4% | | Net cash used for financing activities | (248.8) | (249.3) | 0.5 | -0.2% | | Net increase (decrease) in cash and cash equivalents | 102.9 | (34.4) | 137.3 | -399.1% | | Cash and cash equivalents, end of period | 787.9 | 613.6 | 174.3 | 28.4% | [Consolidated Statements of Changes in Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This section details the changes in the company's equity accounts, including common stock, retained earnings, and comprehensive income Changes in Stockholders' Equity (Six Months Ended June 30, 2025) | Metric | Common Stock (Shares) | Common Stock (Amount $) | Additional Paid in Capital ($) | Retained Earnings ($) | Accumulated Other Comprehensive Loss ($) | Total Stockholders' Equity ($) | | :-------------------------------- | :-------------------- | :---------------------- | :----------------------------- | :-------------------- | :--------------------------------------- | :----------------------------- | | Balance at January 1, 2025 | 89,802 | 0.9 | 669.8 | 3,776.7 | (43.4) | 4,404.0 | | Common stock withheld and retired to cover taxes on vested stock awards | (116) | — | (1.2) | (21.9) | — | (23.1) | | Common stock dividends declared | — | — | — | (226.6) | — | (226.6) | | Share-based compensation and other | 294 | — | 30.5 | — | — | 30.5 | | Comprehensive income | — | — | — | 445.3 | 2.0 | 447.3 | | Balance at June 30, 2025 | 89,980 | 0.9 | 699.1 | 3,973.5 | (41.4) | 4,632.1 | [Condensed Notes to Unaudited Quarterly Consolidated Financial Statements](index=7&type=section&id=Condensed%20Notes%20to%20Unaudited%20Quarterly%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited quarterly consolidated financial statements [1. Nature of Operations and Basis of Presentation](index=7&type=section&id=1.%20Nature%20of%20Operations%20and%20Basis%20of%20Presentation) This note describes PCA's business activities, segments, and the foundational principles used in preparing financial statements - Packaging Corporation of America (PCA) is a large diverse manufacturer of packaging and paper products, operating primarily in the United States. It reports business in **three segments**: Packaging, Paper, and Corporate and Other[23](index=23&type=chunk)[24](index=24&type=chunk) - On July 1, 2025, PCA announced an agreement to acquire Greif, Inc.'s containerboard business for **$1.8 billion in cash**, expected to close by the end of Q3. This acquisition includes **two containerboard mills (800,000 tons capacity)** and **eight sheet feeder/corrugated plants** across the U.S[25](index=25&type=chunk) [2. New and Recently Adopted Accounting Standards](index=7&type=section&id=2.%20New%20and%20Recently%20Adopted%20Accounting%20Standards) This note outlines the impact of recently adopted and upcoming accounting standards on the company's financial reporting - Effective **January 1, 2024**, PCA adopted ASU 2023-07, Segment Reporting, which improved reportable segment disclosure requirements, with no significant impact on the Company's disclosures[28](index=28&type=chunk) - New accounting standards not yet adopted include ASU 2024-03 (Expense Disaggregation Disclosures) and ASU 2023-09 (Income Tax Disclosures), both of which the Company is currently assessing for impact[29](index=29&type=chunk)[30](index=30&type=chunk) [3. Revenue](index=8&type=section&id=3.%20Revenue) This note details the company's revenue recognition policies and disaggregates revenue by product line Revenue Disaggregated by Product Line (Millions $) | Product Line | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Packaging | 2,005.9 | 1,908.3 | 3,976.3 | 3,706.5 | | Paper | 145.8 | 150.1 | 300.0 | 313.9 | | Corporate and Other | 19.6 | 16.9 | 36.0 | 34.4 | | **Total revenue** | **2,171.3** | **2,075.3** | **4,312.3** | **4,054.8** | - Revenue is recognized when control of goods or services is transferred to customers. For packaging and paper products, this occurs at the point of shipment from the mill or manufacturing facility[32](index=32&type=chunk)[34](index=34&type=chunk)[37](index=37&type=chunk) - Corporate and Other revenue primarily relates to Louisiana Timber Procurement Company, L.L.C. (LTP), a variable-interest entity consolidated by PCA[38](index=38&type=chunk) [4. Earnings Per Share](index=10&type=section&id=4.%20Earnings%20Per%20Share) This note provides the calculation of basic and diluted earnings per common share for the reporting periods Earnings Per Common Share (Six Months Ended June 30) | Metric | 2025 | 2024 | | :-------------------------------- | :--- | :--- | | Net income attributable to common shareholders (Millions $) | 442.3 | 343.4 | | Weighted average basic common shares outstanding (Millions) | 89.3 | 89.1 | | Weighted average diluted common shares outstanding (Millions) | 89.7 | 89.5 | | Basic income per common share ($) | 4.95 | 3.86 | | Diluted income per common share ($) | 4.93 | 3.84 | [5. Other Income (Expense), Net](index=10&type=section&id=5.%20Other%20Income%20(Expense),%20Net) This note details various non-operating income and expense items, including facilities closure costs and litigation impacts Other Income (Expense), Net (Millions $) | Component | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Facilities closure and other income (costs) | 25.3 | (0.1) | 23.0 | — | | Asset disposals and write-offs | (10.5) | (8.0) | (18.8) | (15.5) | | Acquisition and integration-related costs | (1.6) | — | (1.6) | — | | DeRidder litigation | — | (2.0) | — | (125.7) | | DeRidder litigation insurance recovery | — | 2.0 | — | 125.7 | | Jackson mill conversion-related activities | — | 0.6 | — | (7.6) | | Other | (9.3) | (4.7) | (11.8) | (11.7) | | **Total** | **3.9** | **(12.2)** | **(9.2)** | **(34.8)** | - For the three months ended June 30, 2025, total other income (expense), net, was **$3.9 million**, a significant improvement from a **$(12.2) million expense** in the prior year, primarily due to income from facilities closure and other income[43](index=43&type=chunk) - For the six months ended June 30, 2025, total other income (expense), net, was **$(9.2) million**, an improvement from **$(34.8) million** in the prior year, largely due to the absence of DeRidder litigation expenses and recoveries[43](index=43&type=chunk) [6. Income Taxes](index=10&type=section&id=6.%20Income%20Taxes) This note provides information on income tax expense, effective tax rates, and the impact of new tax legislation Income Tax Expense and Effective Tax Rate | Period | Income Tax Expense (Millions $) | Effective Tax Rate | | :-------------------------------- | :------------------------------ | :----------------- | | Three Months Ended June 30, 2025 | 79.1 | 24.7% | | Three Months Ended June 30, 2024 | 67.8 | 25.4% | | Six Months Ended June 30, 2025 | 142.7 | 24.3% | | Six Months Ended June 30, 2024 | 108.4 | 23.9% | - The decrease in the effective tax rate for the three months ended June 30, 2025, was primarily due to higher excess tax benefits from employee restricted stock and performance unit vests[44](index=44&type=chunk) - The increase in the effective tax rate for the six months ended June 30, 2025, was primarily due to lower excess tax benefits from employee restricted stock and performance unit vests[45](index=45&type=chunk) - Cash paid for taxes, net of refunds, increased to **$140.5 million** for the six months ended June 30, 2025, from **$110.3 million** in 2024, mainly due to higher forecasted taxable income[47](index=47&type=chunk) - The recently signed One Big Beautiful Bill Act (OBBBA) includes significant tax law changes, such as full expensing of certain depreciable property and R&D expenditures, which the Company is currently evaluating for impact[49](index=49&type=chunk) [7. Inventories](index=12&type=section&id=7.%20Inventories) This note details the composition of the company's inventories, including raw materials, work in process, and finished goods Inventories (Millions $) | Component | June 30, 2025 | December 31, 2024 | | :------------------ | :-------------- | :---------------- | | Raw materials | 356.4 | 356.6 | | Work in process | 17.4 | 15.5 | | Finished goods | 233.2 | 234.0 | | Supplies and materials | 537.7 | 518.8 | | **Total Inventories** | **1,144.7** | **1,124.9** | [8. Property, Plant, and Equipment](index=12&type=section&id=8.%20Property,%20Plant,%20and%20Equipment) This note provides a breakdown of the company's property, plant, and equipment, net of accumulated depreciation Property, Plant, and Equipment, Net (Millions $) | Component | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Land and land improvements | 216.4 | 203.4 | | Buildings | 1,234.3 | 1,140.0 | | Machinery and equipment | 7,547.0 | 7,368.8 | | Construction in progress | 350.9 | 397.2 | | Other | 200.2 | 195.8 | | Property, plant and equipment, at cost | 9,548.8 | 9,305.2 | | Less accumulated depreciation | (5,432.9) | (5,266.2) | | **Property, plant, and equipment, net** | **4,115.9** | **4,039.0** | - Depreciation expense for the three months ended June 30, 2025, was **$130.8 million**, up from **$118.7 million** in 2024. For the six months, it was **$258.9 million** in 2025, up from **$236.8 million** in 2024[51](index=51&type=chunk) [9. Goodwill and Intangible Assets](index=13&type=section&id=9.%20Goodwill%20and%20Intangible%20Assets) This note details the company's goodwill and other intangible assets, including customer relationships and trademarks - Goodwill remained constant at **$922.4 million** as of June 30, 2025, and December 31, 2024, entirely within the Packaging segment[53](index=53&type=chunk) Intangible Assets (Excluding Goodwill) (Millions $) | Component | June 30, 2025 Gross Carrying Amount | June 30, 2025 Accumulated Amortization | December 31, 2024 Gross Carrying Amount | December 31, 2024 Accumulated Amortization | | :-------------------------- | :---------------------------------- | :------------------------------------- | :------------------------------------ | :------------------------------------- | | Customer relationships | 546.0 | 380.2 | 546.0 | 362.4 | | Trademarks and trade names | 41.3 | 34.0 | 41.3 | 33.0 | | Other | 4.4 | 4.4 | 4.4 | 4.4 | | **Total intangible assets** | **591.7** | **418.6** | **591.7** | **399.8** | - Amortization expense for intangible assets was **$18.8 million** for the six months ended June 30, 2025, compared to **$18.9 million** in the prior year[54](index=54&type=chunk) [10. Accrued Liabilities](index=13&type=section&id=10.%20Accrued%20Liabilities) This note provides a breakdown of various accrued liabilities, including compensation, taxes, and litigation settlements Accrued Liabilities (Millions $) | Component | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Compensation and benefits | 134.3 | 168.5 | | Medical insurance and workers' compensation | 30.3 | 29.1 | | Franchise, property, sales and use taxes | 29.1 | 18.7 | | Customer rebates and other credits | 26.4 | 33.9 | | Severance, retention, and relocation | 4.4 | 3.4 | | Environmental liabilities and asset retirement obligations | 2.0 | 3.2 | | DeRidder litigation and other litigation | — | 96.2 | | Other | 11.7 | 9.9 | | **Total** | **238.2** | **362.9** | - Total accrued liabilities decreased significantly from **$362.9 million** at December 31, 2024, to **$238.2 million** at June 30, 2025, primarily due to the payment of DeRidder litigation and other litigation settlements[55](index=55&type=chunk) [11. Debt](index=13&type=section&id=11.%20Debt) This note details the company's outstanding debt, including fixed-rate senior notes and interest payment information - Cash payments for interest decreased to **$46.7 million** for the six months ended June 30, 2025, from **$53.9 million** in 2024[56](index=56&type=chunk) - As of June 30, 2025, PCA had **$2,492.4 million** of fixed-rate senior notes outstanding, with a fair value estimated at **$2,128.7 million**[58](index=58&type=chunk) [12. Cash, Cash Equivalents, and Marketable Debt Securities](index=15&type=section&id=12.%20Cash,%20Cash%20Equivalents,%20and%20Marketable%20Debt%20Securities) This note provides details on the company's cash, cash equivalents, and available-for-sale marketable debt securities Cash, Cash Equivalents, and AFS Debt Securities (Millions $) | Category | June 30, 2025 Fair Value | December 31, 2024 Fair Value | | :-------------------------------- | :----------------------- | :------------------------- | | Cash and cash equivalents | 784.7 | 684.8 | | Short-term marketable debt securities | 92.4 | 102.0 | | Long-term marketable debt securities | 75.6 | 65.2 | | **Total** | **955.9** | **852.2** | - The Company invests in highly rated, investment-grade securities with maturities generally ranging from **one to two years** for long-term marketable debt securities, aiming to minimize principal loss[63](index=63&type=chunk) - As of June 30, 2025, and December 31, 2024, no impairments related to marketable debt securities were considered credit losses, and all unrealized gains and losses were recorded in other comprehensive income (OCI)[65](index=65&type=chunk) [13. Employee Benefit Plans and Other Postretirement Benefits](index=17&type=section&id=13.%20Employee%20Benefit%20Plans%20and%20Other%20Postretirement%20Benefits) This note outlines the net periodic benefit costs for the company's pension plans and related contributions Net Periodic Benefit Cost for Pension Plans (Millions $) | Component | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Service cost | 2.6 | 3.1 | 5.2 | 6.3 | | Interest cost | 14.3 | 13.9 | 28.6 | 27.7 | | Expected return on plan assets | (15.6) | (16.5) | (31.2) | (32.9) | | Net amortization of unrecognized amounts | 1.4 | 1.6 | 2.8 | 3.1 | | **Net periodic benefit cost** | **2.7** | **2.1** | **5.4** | **4.2** | - PCA makes pension plan contributions sufficient to fund actuarially determined costs, generally the minimum required by ERISA. **No contributions** were made to qualified pension plans during the three and six months ended June 30, 2025 and 2024[67](index=67&type=chunk) [14. Share-Based Compensation](index=17&type=section&id=14.%20Share-Based%20Compensation) This note details the company's share-based compensation expense and available shares for future equity grants - As of June 30, 2025, **2.5 million shares** were available for future grants under the long-term equity incentive plan, which was amended in February 2024 to extend its term to May 8, 2034, and increase authorized shares by **2.4 million**[70](index=70&type=chunk)[71](index=71&type=chunk) Share-Based Compensation Expense (Millions $) | Component | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Restricted stock | 6.1 | 6.0 | 20.0 | 19.9 | | Performance units | 4.2 | 3.9 | 8.1 | 9.3 | | **Total share-based compensation expense** | **10.3** | **9.9** | **28.1** | **29.2** | | Income tax benefit | (2.6) | (2.5) | (7.0) | (7.3) | | **Net of tax benefit** | **7.7** | **7.4** | **21.1** | **21.9** | - Unrecognized compensation expense for all share-based awards totaled **$74.0 million** at June 30, 2025, with a remaining weighted average recognition period of **2.7 years**[74](index=74&type=chunk) [15. Stockholders' Equity](index=20&type=section&id=15.%20Stockholders'%20Equity) This note provides information on dividends paid, stock repurchases, and changes in accumulated other comprehensive income - PCA paid **$224.7 million in dividends** during the six months ended June 30, 2025. A quarterly cash dividend of **$1.25 per share** was declared on May 7, 2025, totaling **$112.5 million**[75](index=75&type=chunk) - **No common stock repurchases** were made during the three months ended June 30, 2025. **$436.0 million** remained available under the **$1 billion repurchase authorization** as of June 30, 2025[77](index=77&type=chunk) Changes in Accumulated Other Comprehensive Income (Loss) (AOCI) (Millions $) | Component | Balance at January 1, 2025 | Other comprehensive loss before reclassifications, net of tax | Amounts reclassified from AOCI, net of tax | Balance at June 30, 2025 | | :-------------------------------- | :------------------------- | :---------------------------------------------------------- | :----------------------------------------- | :----------------------- | | Unrealized Loss On Foreign Exchange Contracts | (0.1) | — | — | (0.1) | | Unrealized Loss on Marketable Debt Securities | 0.2 | 0.1 | — | 0.3 | | Unfunded Employee Benefit Obligations | (43.5) | — | 1.9 | (41.6) | | **Total** | **(43.4)** | **0.1** | **1.9** | **(41.4)** | [16. Transactions With Related Parties](index=20&type=section&id=16.%20Transactions%20With%20Related%20Parties) This note describes transactions with related parties, including the consolidated Louisiana Timber Procurement Company - Louisiana Timber Procurement Company, L.L.C. (LTP), **50% owned by PCA** and **50% by Boise Cascade**, is consolidated by PCA as the primary beneficiary. LTP procures wood and fiber for both companies in Louisiana[79](index=79&type=chunk) - LTP sales to Boise Cascade were **$32.8 million** for the six months ended June 30, 2025, down from **$41.1 million** in 2024. Fiber purchases from related parties were **$4.0 million** in 2025, down from **$5.7 million** in 2024[79](index=79&type=chunk)[80](index=80&type=chunk) [17. Segment Information](index=22&type=section&id=17.%20Segment%20Information) This note provides disaggregated financial information for the company's Packaging, Paper, and Corporate and Other segments - PCA operates in **three reportable segments**: Packaging, Paper, and Corporate and Other, each managed separately due to distinct products, services, and operating/marketing strategies[81](index=81&type=chunk) Segment Sales to External Customers (Millions $) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Packaging | 2,005.9 | 1,902.0 | 3,976.3 | 3,695.4 | | Paper | 145.8 | 150.1 | 300.0 | 313.9 | | Corporate and Other | 19.6 | 23.2 | 36.0 | 45.5 | | **Total** | **2,171.3** | **2,075.3** | **4,312.3** | **4,054.8** | Segment Income (Loss) from Operations (Millions $) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Packaging | 346.3 | 279.8 | 624.4 | 483.6 | | Paper | 25.8 | 26.7 | 61.4 | 56.4 | | Corporate and Other | (38.4) | (30.5) | (71.8) | (68.0) | | **Total** | **333.7** | **276.0** | **614.0** | **472.0** | [18. Commitments, Guarantees, Indemnifications and Legal Proceedings](index=24&type=section&id=18.%20Commitments%2C%20Guarantees%2C%20Indemnifications%20and%20Legal%20Proceedings) This note details the company's legal proceedings, including the DeRidder mill lawsuit and a new class action alleging price fixing - As of June 30, 2025, the settlement amount for the DeRidder mill lawsuit has been paid, and **no amounts remain outstanding**. Previously, a **$59.2 million liability** and corresponding receivable were recorded[92](index=92&type=chunk) - PCA was named as a defendant in a purported class action lawsuit on **July 29, 2025**, alleging conspiracy to raise containerboard prices and restrict capacity from **November 1, 2020**, to present. PCA believes the allegations are without merit and will vigorously defend the lawsuit[93](index=93&type=chunk) - The Company believes it is not reasonably possible that any other legal actions will have a material adverse effect on its financial condition, results of operations, or cash flows[94](index=94&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on PCA's financial performance, condition, and future outlook [Overview](index=26&type=section&id=Overview) This section provides a general description of PCA's business, its market position, and primary product offerings - PCA is the third largest producer of containerboard products and a leading producer of UFS paper in North America, operating eight mills and 85 corrugated products manufacturing plants[97](index=97&type=chunk) - The company's products include linerboard and corrugating medium for corrugated products, a wide variety of corrugated packaging, retail merchandise displays, honeycomb protective packaging, and communication-based papers[97](index=97&type=chunk) [Executive Summary](index=26&type=section&id=Executive%20Summary) This section highlights key financial results and strategic developments, including the Greif acquisition, for the reporting period Key Financial Highlights (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 (Millions $) | Q2 2024 (Millions $) | Change ($M) | Change (%) | | :-------------------------------- | :------------------- | :------------------- | :---------- | :--------- | | Net sales | 2,170 | 2,080 | 90 | 4.3% | | Net income | 242 | 199 | 43 | 21.6% | | Diluted EPS | 2.67 | 2.21 | 0.46 | 20.8% | | Net income (excl. special items) | 224 | 199 | 25 | 12.6% | | Diluted EPS (excl. special items) | 2.48 | 2.20 | 0.28 | 12.7% | - The increase in net income was primarily driven by higher prices and mix in the Packaging segment, lower fiber costs, higher prices and mix in the Paper segment, and a lower tax rate[99](index=99&type=chunk) - Packaging segment operating income increased to **$346 million** in Q2 2025 from **$280 million** in Q2 2024, with corrugated plant shipments up **1.7%** per day[99](index=99&type=chunk) - Paper segment operating income slightly decreased to **$26 million** in Q2 2025 from **$27 million** in Q2 2024, mainly due to higher operating costs and lower volumes, partially offset by higher prices[100](index=100&type=chunk) - PCA announced the acquisition of Greif's containerboard business for **$1.8 billion**, expected to close by Q3, which will add **800,000 tons** of production capacity and **eight plants**[104](index=104&type=chunk) [Industry and Business Conditions](index=28&type=section&id=Industry%20and%20Business%20Conditions) This section discusses trends in North American corrugated products and UFS paper markets, including shipment volumes and pricing - North American industry-wide corrugated products shipments were down **2.6%** in total and **1.0%** per workday in Q2 2025 YoY. Industry containerboard production decreased **5.2%**[105](index=105&type=chunk) - Containerboard export shipments were down **16.2%** in Q2 2025 YoY. Reported index prices for linerboard and corrugating medium increased **$40 per ton** in February 2025[105](index=105&type=chunk) - North American UFS paper shipments were down **8.5%** in the first six months of 2025 YoY. Average prices for cut size office papers increased by **$47 per ton (3.2%)** in Q2 2025 YoY[106](index=106&type=chunk) [Outlook](index=28&type=section&id=Outlook) This section provides the company's expectations for future performance, including corrugated shipments, pricing, and operating costs - For Q3, PCA expects higher corrugated shipments and containerboard production, but lower export containerboard sales due to the global trade environment[107](index=107&type=chunk) - Packaging segment prices and mix are expected to be relatively flat with Q2 levels. Paper segment pricing is also expected to be flat, with production and sales increasing due to the completed International Falls mill outage and seasonal back-to-school orders[107](index=107&type=chunk) - Maintenance outage expense is expected to be lower in Q3, with **no scheduled outages**. Freight costs will be higher due to rail rate increases, while operating costs are expected to be near Q2 levels and fiber costs slightly lower[107](index=107&type=chunk) - Overall, PCA expects Q3 earnings to be higher than Q2 earnings, excluding special items, with this outlook not including any impact from the pending Greif acquisition[107](index=107&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) This section provides a detailed comparative analysis of the company's financial performance for the current and prior periods [Three Months Ended June 30, 2025, compared to Three Months Ended June 30, 2024](index=29&type=section&id=Three%20Months%20Ended%20June%2030,%202025,%20compared%20to%20Three%20Months%20Ended%20June%2030,%202024) This section analyzes the company's financial performance for the second quarter of 2025 compared to the same period in 2024 Q2 2025 vs. Q2 2024 Financial Performance (Millions $) | Metric | Q2 2025 | Q2 2024 | Change ($M) | Change (%) | | :-------------------------------- | :------ | :------ | :---------- | :--------- | | Net sales | 2,171.3 | 2,075.3 | 96.0 | 4.6% | | Income from operations | 333.7 | 276.0 | 57.7 | 20.9% | | Net income | 241.5 | 198.9 | 42.6 | 21.4% | | Net income excluding special items | 224.2 | 198.6 | 25.6 | 12.9% | | Consolidated EBITDA | 474.4 | 404.5 | 69.9 | 17.3% | | Packaging EBITDA excluding special items | 452.9 | 400.0 | 52.9 | 13.2% | | Paper EBITDA excluding special items | 30.3 | 30.6 | (0.3) | -1.0% | - Packaging net sales increased **$98 million (5.1%)** due to higher containerboard and corrugated products prices and mix (**$107 million**), partially offset by lower volume (**$9 million**). Domestic containerboard prices were **10.8% higher**, and export prices were **10.4% higher**[111](index=111&type=chunk) - Paper net sales decreased **$4 million (2.9%)** due to lower volume (**$8 million**), partially offset by higher prices and mix (**$4 million**)[112](index=112&type=chunk) - Gross profit increased **$45 million**, driven by higher prices/mix in Packaging and Paper, and lower fiber costs, partially offset by higher operating costs, maintenance outage expense, and lower volumes[113](index=113&type=chunk) - SG&A expenses increased **$4 million**, primarily due to higher employee-related expenses and insurance[114](index=114&type=chunk) - Packaging segment operating income increased **$66 million**, mainly from higher prices/mix (**$119 million**) and lower fiber costs (**$18 million**), despite higher operating/converting costs, maintenance outage expenses, and lower volumes[117](index=117&type=chunk) - Paper segment operating income decreased **$1 million**, primarily due to higher operating costs and lower volumes, partially offset by higher prices/mix[118](index=118&type=chunk) - Interest expense, net, increased **$3 million** due to higher interest expense from the November 2023 debt refinancing[120](index=120&type=chunk) [Six Months Ended June 30, 2025, compared to Six Months Ended June 30, 2024](index=31&type=section&id=Six%20Months%20Ended%20June%2030,%202025,%20compared%20to%20Six%20Months%20Ended%20June%2030,%202024) This section analyzes the company's financial performance for the first half of 2025 compared to the same period in 2024 H1 2025 vs. H1 2024 Financial Performance (Millions $) | Metric | H1 2025 | H1 2024 | Change ($M) | Change (%) | | :-------------------------------- | :------ | :------ | :---------- | :--------- | | Net sales | 4,312.3 | 4,054.8 | 257.5 | 6.4% | | Income from operations | 614.0 | 472.0 | 142.0 | 30.1% | | Net income | 445.3 | 345.9 | 99.4 | 28.7% | | Net income excluding special items | 432.4 | 353.2 | 79.2 | 22.4% | | Consolidated EBITDA | 892.6 | 728.9 | 163.7 | 22.5% | | Packaging EBITDA excluding special items | 862.1 | 726.2 | 135.9 | 18.7% | | Paper EBITDA excluding special items | 70.5 | 71.2 | (0.7) | -1.0% | - Packaging net sales increased **$270 million (7.3%)** due to higher prices/mix (**$202 million**) and higher volume (**$68 million**). Domestic containerboard prices were **7.1% higher**, and export prices were **11.7% higher**[125](index=125&type=chunk) - Paper net sales decreased **$14 million (4.4%)** due to lower volume (**$20 million**), partially offset by higher prices/mix (**$6 million**)[126](index=126&type=chunk) - Gross profit increased **$130 million**, driven by higher prices/mix and sales volumes in Packaging, lower fiber costs, and higher prices/mix in Paper, partially offset by higher operating costs and maintenance outage expense[127](index=127&type=chunk) - SG&A expenses increased **$13 million**, primarily due to higher employee-related expenses, insurance, and bad debt expense[128](index=128&type=chunk) - Packaging segment operating income increased **$141 million**, mainly from higher prices/mix (**$210 million**), lower fiber costs (**$27 million**), and higher sales/production volumes (**$16 million**), despite increased operating costs and maintenance outage expenses[131](index=131&type=chunk) - Paper segment operating income increased **$5 million**, benefiting from **no special items in 2025** (vs. **$6 million expense** in 2024), higher prices/mix, and lower fixed/freight expenses, partially offset by lower volumes and higher operating/maintenance costs[132](index=132&type=chunk) - Interest expense, net, increased **$6 million** due to higher interest expense from the November 2023 debt refinancing and lower interest income[134](index=134&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's sources and uses of cash, borrowing capacity, and capital investment plans - Primary liquidity sources are net cash from operating activities and available borrowing capacity under the revolving credit facility. As of June 30, 2025, PCA had **$788 million in cash**, **$168 million in marketable debt securities**, and **$323 million in unused borrowing capacity**[136](index=136&type=chunk) Summary of Cash Flows (Six Months Ended June 30, Millions $) | Activity | 2025 | 2024 | Change ($M) | | :-------------------------------- | :----- | :----- | :---------- | | Operating activities | 638.7 | 538.7 | 100.0 | | Investing activities | (287.0) | (323.8) | 36.8 | | Financing activities | (248.8) | (249.3) | 0.5 | | **Net increase (decrease) in cash and cash equivalents** | **102.9** | **(34.4)** | **137.3** | - Net cash provided by operating activities increased by **$100 million** to **$639 million** in H1 2025, primarily due to higher income from operations and favorable changes in prepaid expenses and accounts receivable[139](index=139&type=chunk)[141](index=141&type=chunk) - Cash used for investing activities decreased to **$287 million** in H1 2025 from **$324 million** in H1 2024. Capital investments were **$318 million** in H1 2025[140](index=140&type=chunk) - Expected capital investments for 2025 are in the range of **$840 million to $870 million**, including approximately **$24 million** for environmental compliance[142](index=142&type=chunk) - Net cash used for financing activities remained stable at **$249 million** in H1 2025. Dividends paid were **$225 million**, and **$23 million** was withheld for employee restricted stock taxes[143](index=143&type=chunk) [Non-GAAP Financial Measures](index=35&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations and explanations for non-GAAP financial measures used to evaluate company performance - PCA uses non-GAAP financial measures such as earnings per diluted share excluding special items, net income excluding special items, EBITDA, and segment EBITDA to evaluate performance and provide meaningful comparisons, as these are used by management and investors[146](index=146&type=chunk) Earnings Per Diluted Share Reconciliation (Non-GAAP, $) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | As reported in accordance with GAAP | 2.67 | 2.21 | 4.93 | 3.84 | | Total special items | (0.19) | — | (0.14) | 0.08 | | **Excluding special items** | **2.48** | **2.20** | **4.79** | **3.92** | Net Income Reconciliation (Non-GAAP, Millions $) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | As reported in accordance with GAAP | 241.5 | 198.9 | 445.3 | 345.9 | | Total special items | (17.3) | (0.3) | (12.9) | 7.3 | | **Excluding special items** | **224.2** | **198.6** | **432.4** | **353.2** | EBITDA Reconciliation (Non-GAAP, Millions $) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | 241.5 | 198.9 | 445.3 | 345.9 | | Non-operating pension income | — | (1.1) | — | (2.2) | | Interest expense, net | 13.1 | 10.4 | 26.0 | 19.9 | | Income tax provision | 79.1 | 67.8 | 142.7 | 108.4 | | Depreciation, amortization, and depletion | 140.7 | 128.5 | 278.6 | 256.9 | | **EBITDA** | **474.4** | **404.5** | **892.6** | **728.9** | | Total special items | (23.6) | (0.5) | (20.8) | 8.3 | | **EBITDA excluding special items** | **450.8** | **404.0** | **871.8** | **737.2** | [Market Risk and Risk Management Policies](index=38&type=section&id=Market%20Risk%20and%20Risk%20Management%20Policies) This section outlines the company's exposure to market risks, including commodity prices and interest rates, and its mitigation strategies - PCA is exposed to commodity price changes, interest rate changes, and market value fluctuations of financial instruments. It may use derivatives, such as physical natural gas supply contracts, which qualify for the normal purchase normal sale exception[152](index=152&type=chunk) - As of June 30, 2025, **100%** of PCA's outstanding debt has fixed interest rates[153](index=153&type=chunk) [Off-Balance-Sheet Activities](index=38&type=section&id=Off-Balance-Sheet%20Activities) This section confirms the absence of any off-balance sheet arrangements as of the reporting date - The Company does not have any off-balance sheet arrangements as of June 30, 2025[154](index=154&type=chunk) [Environmental Matters](index=38&type=section&id=Environmental%20Matters) This section refers to the environmental matters disclosure from the previous annual report, noting no material changes - There have been **no material changes** to the environmental matters disclosure from the 2024 Annual Report on Form 10-K[155](index=155&type=chunk) [Critical Accounting Policies and Estimates](index=39&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section highlights the significant accounting policies and estimates requiring management judgment in financial reporting - PCA's financial statements require estimates and judgments related to business combinations, pensions, goodwill, intangible assets, long-lived asset impairment, environmental liabilities, and income taxes[156](index=156&type=chunk) - **No changes** to critical accounting estimates occurred during the first six months of 2025[157](index=157&type=chunk) [New and Recently Adopted Accounting Standards](index=39&type=section&id=New%20and%20Recently%20Adopted%20Accounting%20Standards) This section directs readers to Note 2 for details on new and recently adopted accounting standards - For details on new and recently adopted accounting standards, refer to Note 2 of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements[158](index=158&type=chunk) [Forward-Looking Statements](index=39&type=section&id=Forward-Looking%20Statements) This section cautions that the report contains forward-looking statements subject to various risks and uncertainties - The report contains forward-looking statements regarding future liquidity, earnings, expenditures, and financial condition, which are subject to numerous risks and uncertainties[159](index=159&type=chunk) - Key factors that could cause actual results to differ materially include general economic conditions, impacts of acquired businesses, industry conditions (competition, demand, pricing, input costs), fluctuations in fiber and energy costs, unplanned outages, and governmental actions[161](index=161&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section refers to the market risk disclosures detailed in Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations - For a discussion of market risks related to PCA, refer to the 'Market Risk and Risk Management Policies' section within Item 2 of this Quarterly Report on Form 10-Q[162](index=162&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of PCA's disclosure controls and procedures and reports no material changes in internal control over financial reporting - PCA's disclosure controls and procedures were evaluated and deemed **effective** at the reasonable assurance level as of June 30, 2025[164](index=164&type=chunk) - **No material changes** in internal control over financial reporting occurred during the quarter ended June 30, 2025[165](index=165&type=chunk) [PART II OTHER INFORMATION](index=41&type=section&id=PART%20II%20OTHER%20INFORMATION) This section provides additional information not covered in the financial statements, including legal proceedings and equity security details [Item 1. Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) This section incorporates legal proceedings disclosures from Note 18, detailing the DeRidder Mill incident and a new class action lawsuit - The disclosure on legal proceedings is incorporated from Note 18, Commitments, Guarantees, Indemnifications and Legal Proceedings, in Part I, Item 1 of this Form 10-Q[168](index=168&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) This section confirms no material changes to the risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K - **No material changes** to the risk factors disclosed in the 2024 Annual Report on Form 10-K have occurred[169](index=169&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details common stock repurchases and shares withheld for taxes on equity awards during the three months ended June 30, 2025 Issuer Purchases of Equity Securities (Three Months Ended June 30, 2025) | Period | Total Number of Shares Purchased (a) | Average Price Paid Per Share ($) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (Millions $) | | :---------------- | :--------------------------------- | :------------------------------- | :----------------------------------------------------------------- | :--------------------------------------------------------------------------------- | | April 1-30, 2025 | 39,303 | 183.48 | — | 436.0 | | May 1-31, 2025 | 43 | 188.71 | — | 436.0 | | June 1-30, 2025 | 2,189 | 186.46 | — | 436.0 | | **Total** | **41,535** | **183.65** | **—** | **436.0** | - All shares purchased were withheld from employees to cover income and payroll taxes on vested equity awards[170](index=170&type=chunk) [Item 3. Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section confirms that no defaults upon senior securities occurred during the reporting period - **No defaults** upon senior securities[171](index=171&type=chunk) [Item 4. Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that mine safety disclosures are not applicable to the company's operations - Mine safety disclosures are **not applicable** to the Company[172](index=172&type=chunk) [Item 5. Other Information](index=41&type=section&id=Item%205.%20Other%20Information) This section confirms no Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers during the quarter - **No directors or officers** adopted or terminated any Rule 10b5-1 trading arrangements during the three months ended June 30, 2025[173](index=173&type=chunk) [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including certifications and XBRL documents List of Exhibits | Exhibit Number | Description | | :------------- | :---------- | | 31.1 | Certification of Chief Executive Officer, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. † | | 31.2 | Certification of Chief Financial Officer, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. † | | 32 | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. §1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. † | | 101.INS | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. † | | 101.SCH | Inline XBRL Taxonomy Extension Schema Document. † | | 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). † |

PART I [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements.) Aemetis, Inc.'s Q2 2025 unaudited financials reflect decreased assets, increased current liabilities from debt reclassification, an improved net loss, and a 'going concern' warning due to significant debt and lender reliance [Consolidated Condensed Balance Sheets](index=4&type=section&id=CONSOLIDATED%20CONDENSED%20BALANCE%20SHEETS) As of June 30, 2025, total assets were $240.0 million, a decrease from $259.3 million at year-end 2024, with current liabilities sharply rising to $321.9 million from $144.0 million due to debt reclassification, worsening the total stockholders' deficit to $289.3 million Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $20,086 | $44,696 | | **Total Assets** | $240,016 | $259,302 | | **Total Current Liabilities** | $321,927 | $143,968 | | **Total Liabilities** | $529,271 | $523,230 | | **Total Stockholders' Deficit** | $(289,255) | $(263,928) | [Consolidated Condensed Statements of Operations](index=5&type=section&id=CONSOLIDATED%20CONDENSED%20STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20INCOME%20(LOSS)) For the three months ended June 30, 2025, revenues decreased to $52.2 million from $66.6 million year-over-year, resulting in a worsening gross loss of $3.4 million, though the net loss improved to $23.4 million, or ($0.41) per share, primarily due to lower SG&A expenses Q2 2025 vs Q2 2024 Performance (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Revenues** | $52,243 | $66,561 | | **Gross Loss** | $(3,355) | $(1,806) | | **Operating Loss** | $(10,674) | $(13,606) | | **Net Loss** | $(23,395) | $(29,174) | | **Net Loss Per Share (Basic)** | $(0.41) | $(0.66) | Six Months 2025 vs 2024 Performance (in thousands, except per share data) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | **Revenues** | $95,129 | $139,195 | | **Gross Loss** | $(8,435) | $(2,418) | | **Operating Loss** | $(26,229) | $(23,068) | | **Net Loss** | $(47,924) | $(53,405) | | **Net Loss Per Share (Basic)** | $(0.87) | $(1.24) | [Consolidated Condensed Statements of Cash Flows](index=6&type=section&id=CONSOLIDATED%20CONDENSED%20STATEMENTS%20OF%20CASH%20FLOWS) For the six months ended June 30, 2025, net cash used in operating activities significantly improved to $5.6 million, while net cash provided by financing activities was $11.3 million, primarily from stock sales and new borrowings, leading to an overall increase of $0.8 million in cash and cash equivalents Six-Month Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net Cash Used in Operating Activities** | $(5,577) | $(15,372) | | **Net Cash Used in Investing Activities** | $(4,939) | $(5,935) | | **Net Cash Provided by Financing Activities** | $11,268 | $18,743 | | **Net Change in Cash** | $759 | $(2,538) | [Notes to Consolidated Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Condensed%20Financial%20Statements) The notes detail the company's operational segments, accounting policies, and financial position, including significant debt obligations and a critical disclosure on liquidity and going concern, highlighting substantial operational and financial risks - The company operates in three main segments: California Ethanol, California Dairy Renewable Natural Gas (RNG), and India Biodiesel, while also developing projects in Sustainable Aviation Fuel (SAF), Renewable Diesel (RD), and Carbon Capture and Underground Sequestration (CCUS)[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) - Total debt stood at **$344.2 million** as of June 30, 2025, with a significant portion of **$270.6 million** due within the next twelve months, highlighting near-term refinancing risk[45](index=45&type=chunk)[58](index=58&type=chunk) - The company has concluded that there is substantial doubt about its ability to continue as a going concern due to its significant debt, reliance on its senior lender, and expected near-term cash flow shortfalls[112](index=112&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management discusses a **21.5% decrease** in Q2 2025 revenue, primarily from India Biodiesel, offset by strong California Dairy RNG growth, while liquidity remains a critical concern due to debt and lender reliance, despite outlined strategies for cash flow improvement - The company is focused on building a circular bioeconomy using agricultural products and waste to produce low-carbon renewable fuels[115](index=115&type=chunk) - Key strategic initiatives to improve liquidity include constructing a Mechanical Vapor Recompression (MVR) system to reduce natural gas use, building new dairy digesters for RNG production, and monetizing new Section 45Z tax credits for both ethanol and RNG[101](index=101&type=chunk)[105](index=105&type=chunk)[102](index=102&type=chunk) - Despite plans to improve liquidity, management reiterates that substantial doubt exists about the company's ability to continue as a going concern due to its debt levels and reliance on its senior lender[112](index=112&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Comparing Q2 2025 to Q2 2024, total revenues fell by $14.3 million (**21.5%**) to $52.2 million, driven by a $12.9 million decrease in India Biodiesel sales, while California Dairy RNG revenue grew by $1.5 million (**90.9%**), and the total gross loss increased to $3.4 million Revenues by Segment - Q2 2025 vs Q2 2024 (in thousands) | Segment | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | California Ethanol | $37,288 | $40,132 | (7.1)% | | California Dairy RNG | $3,051 | $1,598 | 90.9% | | India Biodiesel | $11,904 | $24,831 | (52.1)% | | **Total** | **$52,243** | **$66,561** | **(21.5)%** | Gross Profit (Loss) by Segment - Q2 2025 vs Q2 2024 (in thousands) | Segment | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | California Ethanol | $(3,806) | $(3,921) | (2.9)% | | California Dairy RNG | $855 | $(136) | (728.7)% | | India Biodiesel | $(404) | $2,251 | (117.9)% | | **Total** | **$(3,355)** | **$(1,806)** | **85.8%** | - The decrease in SG&A expense was primarily due to a one-time **$3.6 million** loss on an asset write-off in Q2 2024, which was not repeated in Q2 2025[140](index=140&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity position is precarious, with cash and cash equivalents at only $1.6 million and a current ratio of 0.06 as of June 30, 2025, relying heavily on equity sales and debt, including **$225.7 million** with its senior lender, Third Eye Capital, with significant maturities in 2026 - Cash and cash equivalents were **$1.6 million** at June 30, 2025, with a current ratio of **0.06**, indicating severe short-term liquidity pressure[152](index=152&type=chunk) - The company is highly dependent on its senior lender, Third Eye Capital, for continued financing and amendments to its debt facilities, with debt totaling **$225.7 million** as of June 30, 2025, including **$45.6 million** due on demand and **$152.4 million** due in April 2026[157](index=157&type=chunk)[159](index=159&type=chunk) - During the six months ended June 30, 2025, the company sold **10.0 million** shares of common stock for net proceeds of **$18.0 million** through its at-the-market offering[164](index=164&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk.) This item is marked as 'Not applicable' in the report, indicating no new or materially changed information to disclose regarding market risk compared to the last annual report - The company has indicated that this section is not applicable for this reporting period[168](index=168&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures.) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025, due to previously identified material weaknesses in IT general controls and financial reporting systems, with remediation plans currently in progress - The CEO and CFO concluded that disclosure controls and procedures were not effective as of the end of the period[169](index=169&type=chunk) - The ineffectiveness is due to material weaknesses related to IT general controls and financial reporting systems, as identified in the 2024 Form 10-K[169](index=169&type=chunk)[171](index=171&type=chunk) - Remediation plans to address the material weaknesses are in progress[171](index=171&type=chunk) PART II [Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings.) The company reported no legal proceedings for the period - None reported[172](index=172&type=chunk) [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors.) This item is marked as 'Not applicable,' indicating no material changes from the risk factors previously disclosed in the company's Annual Report on Form 10-K - Not applicable[173](index=173&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) During the second quarter of 2025, the company issued warrants to two subordinated lenders to purchase **113,000 shares** of common stock at $0.01 per share in connection with debt extensions, and also issued **29,240 shares** to a vendor for services, with these issuances exempt from registration under Section 4(2) of the Securities Act of 1933 - Issued warrants to purchase **113,000 shares** to subordinated lenders as part of debt extension agreements[174](index=174&type=chunk) - Issued **29,240 shares** of common stock to a vendor for services[175](index=175&type=chunk) [Defaults Upon Senior Securities](index=44&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities.) The company reported no unresolved defaults on its senior securities during the six months ended June 30, 2025 - No unresolved defaults on senior securities occurred during the period[176](index=176&type=chunk) [Signatures](index=46&type=section&id=Signatures) - The report was signed on August 7, 2025, by Eric A. McAfee, Chairman and CEO, and Todd A. Waltz, Executive Vice President and CFO[183](index=183&type=chunk)