Financial Performance - Consolidated net sales for Q3 2025 were $19.7 million, a decrease of $1.2 million, or 5.7%, compared to Q3 2024, primarily due to a 12.4% decrease in pounds shipped [100]. - Consolidated gross profit for Q3 2025 increased 94.2% to $5.8 million, or 29.7% of sales, compared to $3.0 million, or 14.4% of sales in Q3 2024 [102]. - Consolidated SG&A expenses for Q3 2025 increased to $6.3 million, or 31.7% of sales, compared to $5.0 million, or 24.1% of sales in Q3 2024 [103]. - Consolidated operating loss for Q3 2025 was $0.8 million, an improvement from an operating loss of $2.0 million in Q3 2024 [105]. - Consolidated net sales for the nine months ended September 30, 2025 were $56.2 million, a decrease of $6.5 million, or 10.3%, compared to the same period in 2024 [101]. - The company experienced a net loss from continuing operations of $(125,000) for the three months ended September 30, 2025, compared to $(7,801,000) in the same period of 2024 [116]. Cash Flow and Liquidity - The divestiture of American Stainless Tubing generated approximately $16 million in cash proceeds, with a preliminary pretax gain on sale of $4.6 million [95]. - The divestiture of Bristol Metals resulted in approximately $45 million in cash proceeds, with a pretax gain on sale of $2.5 million recognized in Q3 2025 [96][98]. - As of September 30, 2025, the company held $58.0 million in cash and cash equivalents and had $13.7 million of remaining available capacity on its revolving line of credit [118]. - Cash used in operating activities for the nine months ended September 30, 2025, was $(7,568,000), compared to $924,000 in the same period of 2024 [119]. - The company had no debt outstanding as of September 30, 2025, and December 31, 2024 [126]. - The current ratio improved to 6.4 as of September 30, 2025, compared to 2.8 at the end of 2024 [129]. Capital Management - The company repurchased 725,775 shares for a total cost of $8,897,903 during the nine months ended September 30, 2025, at an average price of $12.23 per share [128]. - Capital expenditures are expected to be as much as $1.6 million for the remainder of fiscal 2025 [130]. - The company’s liquidity management strategy includes a disciplined approach to capital allocation, focusing on investments that support business growth [117]. Tax and Economic Factors - The effective tax rate for continuing operations was 0.7% for Q3 2025, significantly lower than the U.S. statutory rate of 21.0% [113]. - The company continues to monitor macroeconomic trends, including material inflation and tariffs, which may impact future net sales and profitability [99]. Performance Metrics - EBITDA and Adjusted EBITDA are used as key measures for evaluating operating performance, although they are non-GAAP measures [114][115]. - Consolidated Adjusted EBITDA for the three months ended September 30, 2025, was $1,376,000, representing 7.0% of sales, compared to a loss of $709,000 and (3.4)% of sales in the same period of 2024 [116]. - Specialty Chemicals Adjusted EBITDA for the three months ended September 30, 2025, was $3,158,000, or 16.0% of segment sales, compared to $1,524,000 and 7.3% in the same period of 2024 [116].

Property and Investment Overview - As of September 30, 2025, the company owned 112 properties totaling 9.0 million square feet, with an investment of $2.5 billion and an additional commitment of $7.8 million for tenant improvements [160]. - The operating portfolio consisted of 109 properties, which were 95.8% leased with a weighted-average remaining lease term of 12.9 years [161]. - The company owned 112 properties in 19 states leased to 36 tenants as of September 30, 2025, with the largest property accounting for 5.5% of net real estate held for investment [187]. - The company has expanded its growth strategy to include a broader range of real estate investments due to challenging market dynamics in the regulated cannabis industry [161]. - The company has committed to a $100 million credit facility for IQHQ REIT, enhancing its investment capabilities in the life science sector [168]. Tenant Defaults and Legal Actions - The company declared defaults for certain tenants, including 4Front Ventures Corp. and Gold Flora, which collectively accounted for approximately 11.4% of the company's annualized contractual rent due, totaling $18.0 million, $4.6 million, and $4.4 million respectively [163]. - The company is actively pursuing legal actions against tenants who have defaulted on their lease obligations, including PharmaCann, which owes $21.4 million as of September 30, 2025 [165]. - Rental revenues for the three months ended September 30, 2025 decreased by $11.8 million, or 15%, to $64.3 million compared to $76.1 million for the same period in 2024, primarily due to tenant defaults [195]. - For the nine months ended September 30, 2025, rental revenues decreased by $31.4 million, or 14%, to $198.9 million compared to $230.2 million for the same period in 2024, driven by tenant defaults resulting in a $37.8 million decrease [197]. Financial Performance - Net income attributable to common stockholders for the three months ended September 30, 2025 was $28.3 million, down from $39.7 million in 2024, and for the nine months ended September 30, 2025, it was $83.7 million compared to $120.4 million in 2024 [194]. - Cash flows provided by operating activities for the nine months ended September 30, 2025 were $148.3 million, a decrease of $52.4 million from $200.6 million in 2024, primarily due to lower net income and tenant defaults [208]. - Total expenses for the three months ended September 30, 2025 increased to $35.3 million from $34.6 million in 2024, while total expenses for the nine months ended September 30, 2025 rose to $107.0 million from $102.0 million in 2024 [194]. Debt and Financing - As of September 30, 2025, the outstanding principal balance on the Notes due 2026 was $291.2 million, with plans to refinance these notes prior to maturity in May 2026 [220]. - The company has a liquidity covenant requiring a debt service coverage ratio of at least 2.0 to 1.0, measured at the end of each fiscal quarter [175]. - The company drew $50.0 million under the Revolving Credit Facility in connection with its investment in the IQHQ Credit Facility and initial investment in IQHQ Preferred Stock [222]. - The company’s Revolving Credit Facility has aggregate commitments increased to $87.5 million, maturing on October 23, 2026 [222]. Shareholder Returns and Stock Activity - The company declared dividends totaling $54.463 million for common stock and $1.017 million for Series A preferred stock during the nine months ended September 30, 2025 [227]. - The company has a share repurchase program authorized for up to $100.0 million, with 371,538 shares repurchased during the nine months ended September 30, 2025 [225]. - During the nine months ended September 30, 2025, the company sold 805,009 shares of Series A Preferred Stock for net proceeds of $19.1 million, with an aggregate offering price of up to $470.0 million remaining available under the ATM Program [221]. Market Conditions and Challenges - The company faces significant challenges due to reduced access to capital and mounting debt obligations in the regulated cannabis industry, impacting tenant stability [184]. - Recent changes in U.S. trade policy are expected to increase costs for cannabis cultivation and production, affecting tenants' operational costs [186]. - The competitive environment includes pressure from various market participants, which may affect the company's ability to acquire properties at favorable terms [189]. - Rising interest rates may increase the company's cost of capital, potentially resulting in a negative interest rate spread on certain investments [258]. Operational Structure and Employee Information - The company has 23 full-time employees as of September 30, 2025, indicating a stable operational structure [159]. - The company operates under a UPREIT structure, allowing for efficient management and ownership of its properties [159]. Investment and Dividend Structure - IQHQ Preferred Stock has a cumulative dividend structure with a 10.0% annual cash dividend and a 5.0% paid-in-kind (PIK) dividend, increasing by 1.25% on the fourth and fifth anniversaries of issuance [170]. - The investment in IQHQ Preferred Stock carries a fixed annual dividend rate of 15.0%, consisting of a 10.0% cash dividend and an initial 5.0% PIK dividend [258]. - The IQHQ Credit Facility bears interest at a fixed annual rate of 13.5%, with 12.0% payable in cash and 1.5% PIK, and has an initial term of three years [174].

Revenue and Financial Performance - Total revenues increased by $20.8 million, or 10.2%, to $225.2 million for the first quarter ended September 26, 2025, compared to $204.4 million for the same period in 2024[137]. - The increase in total revenue was primarily driven by C4I and other sensor applications, with increases of $26.2 million and $3.4 million, respectively[138]. - Net loss for the first quarter ended September 26, 2025, was $12,515,000, an improvement from a net loss of $17,525,000 for the same period in 2024[177]. - Adjusted EBITDA for the first quarter ended September 26, 2025, was $35,568,000, compared to $21,450,000 for the first quarter ended September 27, 2024, representing a 65.8% increase[177]. - Adjusted income for the first quarter ended September 26, 2025, was $15,560,000, with adjusted EPS of $0.26, compared to adjusted income of $2,444,000 and adjusted EPS of $0.04 for the same period in 2024[180]. - Free cash flow for the first quarter ended September 26, 2025, was $(4,366,000), a decrease from $(20,896,000) for the first quarter ended September 27, 2024[184]. - Net cash provided by operating activities for the first quarter ended September 26, 2025, was $2,182,000, compared to $(14,660,000) for the same period in 2024[184]. Expenses and Costs - Selling, general and administrative expenses rose by $12.7 million, or 38.4%, to $45.9 million, primarily due to higher compensation and litigation expenses[141]. - Research and development expenses decreased by $5.2 million, or 28.3%, to $13.2 million, mainly due to headcount reductions of approximately 230 employees[142]. - The company incurred $7,224,000 in litigation and settlement expenses for the first quarter ended September 26, 2025, compared to $1,394,000 in the same quarter of 2024[180]. - Stock-based and other non-cash compensation expense for the first quarter ended September 26, 2025, was $16,328,000, compared to $10,560,000 for the same period in 2024[180]. - The company expects to continue incurring expenses similar to those reflected in adjusted income and adjusted EPS adjustments[179]. Margins and Profitability - Gross margin improved to 27.9%, an increase of 260 basis points from 25.3% in the prior year, driven by favorable program mix and lower manufacturing adjustments[139]. - Total interest expense for the first quarter ended September 26, 2025, was $5,859,000, down from $8,362,000 in the same quarter of 2024[177]. Cash and Liquidity - Cash and cash equivalents at the end of Q1 2025 were $304.7 million, a decrease of $4.4 million from the previous quarter[162]. - Working capital increased by $9.0 million as of September 26, 2025, compared to June 27, 2025, indicating improved liquidity[155]. - The company has a $900.0 million Revolver with $591.5 million outstanding as of September 26, 2025, and is in compliance with all covenants[158]. Strategic Initiatives - Acquisition costs and related expenses were $0.6 million for Q1 2025, up from $0.2 million in Q1 2024, indicating increased efforts in seeking acquisition opportunities[146]. - The company continues to explore acquisitions or strategic alliances, with potential material acquisition costs expected in future periods[170]. - A new share repurchase program was authorized for up to $200.0 million of common stock, with no expiration date[172]. - The company expects to incur an additional $2.4 million in restructuring charges during the second quarter, primarily related to severance for 42 international positions[145]. Employee and Operational Metrics - The company has over 2,175 employees as of September 26, 2025, focusing on engineering and research to maintain technological leadership[132]. - Integrated solutions product grouping saw a decrease of $0.2 million, while modules and sub-assemblies increased by $20.4 million[138]. Interest and Other Financial Metrics - Interest income increased to $2.0 million from $0.5 million, while interest expense decreased to $7.9 million from $8.9 million[136]. - Interest income increased to $2.0 million in Q1 2025 from $0.5 million in Q1 2024, driven by higher average cash and cash equivalents[148]. - Interest expense decreased to $7.9 million in Q1 2025 from $8.9 million in Q1 2024, attributed to lower interest rates on the existing credit facility[149]. - Other expense, net rose to $2.1 million in Q1 2025 from $1.3 million in Q1 2024, including $0.9 million in financing costs and $0.8 million in foreign currency translation losses[150]. - Income tax benefits were $4.0 million on losses before income taxes of $16.5 million in Q1 2025, compared to $5.6 million on losses of $23.1 million in Q1 2024[151]. Market Risk - There were no material changes in the company's exposure to market risk from June 27, 2025, to September 26, 2025[187].

Financial Performance - Net earnings from continuing operations for the three months ended September 30, 2025, were $185.7 million, compared to $88.7 million for the same period in 2024, representing a 109% increase [182]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $856.3 million, compared to $839.8 million for the same period in 2024, reflecting a 2.9% increase [182]. - Adjusted Net Earnings for the three months ended September 30, 2025, were $128.3 million, compared to $115.7 million for the same period in 2024, an increase of 10.3% [185]. - Adjusted EPS for the three months ended September 30, 2025, was $0.87, compared to $0.79 for the same period in 2024, indicating a growth of 10.1% [185]. - For the three months ended September 30, 2025, net sales were $1,351.3 million, a 0.5% increase from $1,345.1 million in 2024; for the nine months, net sales decreased by 1.5% to $3,958.8 million from $4,019.8 million [195]. - Gross profit for the three months ended September 30, 2025, was $400.5 million, down 0.2% from $401.5 million in 2024; for the nine months, gross profit decreased by 1.6% to $1,198.4 million from $1,218.3 million [195]. - Net earnings from continuing operations for the three months ended September 30, 2025, were $185.7 million, a 109.4% increase from $88.7 million in 2024; for the nine months, net earnings increased by 47.0% to $396.8 million from $269.9 million [195]. - The company reported a net earnings per common share (basic) of $1.73 for the three months ended September 30, 2025, a 174.6% increase from $0.63 in 2024; for the nine months, it was $3.14, up 67.9% from $1.87 [195]. Segment Performance - Food segment sales on an organic basis for the first nine months of 2025 increased slightly compared to 2024, driven by pricing actions, despite a marginal volume decline, particularly in North America [176]. - Protective segment sales on an organic basis declined in the first nine months of 2025 compared to 2024 due to volume declines and unfavorable pricing, primarily in North America [176]. - For the Food segment, net sales increased by $12 million, or 1%, for the three months ended September 30, 2025, while for the nine months, net sales decreased by $2 million, or less than 1% [201][202]. - In the Protective segment, net sales decreased by $5 million, or 1%, for the three months ended September 30, 2025, and by $59 million, or 4%, for the nine months [204]. - Segment Adjusted EBITDA for the Food segment increased by 4.2% to $214.5 million in Q3 2025 compared to $205.9 million in Q3 2024 [248]. - Segment Adjusted EBITDA for the Protective segment decreased by 6.8% to $229.9 million in the nine months ended September 30, 2025, compared to $246.8 million in the same period of 2024 [248]. Cash Flow and Debt - Net cash provided by operating activities was $334.4 million for the nine months ended September 30, 2025, a decrease of $149.4 million compared to $483.8 million in 2024 [271]. - Net cash used in financing activities was $362.7 million for the nine months ended September 30, 2025, compared to $281.7 million in 2024 [281]. - The company's total debt as of September 30, 2025, was $4,173.6 million, down from $4,403.9 million at December 31, 2024, resulting in a non-GAAP net debt of $3,891.1 million [269]. - Cash and cash equivalents as of September 30, 2025, were $283 million, with approximately 91% located outside the U.S. [257]. - Total cash and cash equivalents decreased from $371.8 million at December 31, 2024, to $282.5 million by September 30, 2025 [258]. Expenses and Cost Management - Cost of sales for Q3 2025 increased by $7 million, or 1%, compared to Q3 2024, with a percentage of net sales rising from 70.2% to 70.4% [206]. - For the nine months ended September 30, 2025, cost of sales decreased by $41 million, or 1%, remaining consistent at 69.7% of net sales compared to 2024 [207]. - Selling, general and administrative (SG&A) expenses decreased by $12 million, or 6%, in Q3 2025 compared to Q3 2024, and by $18 million, or 3%, for the nine months [216][218]. - Amortization expense of intangible assets decreased by $1 million in Q3 2025 and by $2 million for the nine months, primarily due to lower amortization of capitalized software [219][220]. Tax and Special Items - The Adjusted Tax Rate for the three months ended September 30, 2025, was 23.9%, compared to 24.0% for the same period in 2024 [187]. - Effective income tax rate for Q3 2025 was (61)%, significantly improved from 26% in Q3 2024, primarily due to the reversal of accruals for uncertain tax positions related to an IRS audit [231][240]. - The company reported a pre-tax impact of Special Items amounting to $53.0 million for the three months ended September 30, 2025 [182]. - The company recognized a termination fee of $7 million as other income during the nine months ended September 30, 2025, from a lease termination [227]. - A pre-tax loss of $5 million was recognized during the nine months ended September 30, 2025, related to debt redemption and refinancing activities [229]. - Net decreases in unrecognized tax positions were $150 million for Q3 2025, primarily due to the resolution of the IRS audit [235]. Strategic Initiatives - The CTO2Grow Program is expected to deliver annualized savings of $160 million by year-end 2025, with the entire budget already allocated across approved projects [222]. - The company plans to continue monitoring foreign currency impacts and adjusting strategies accordingly, as these fluctuations can significantly affect financial results [196]. Other Financial Metrics - The current ratio improved to 1.3x as of September 30, 2025, compared to 1.2x at December 31, 2024 [284]. - The leverage ratio was 3.16 to 1.00 as of September 30, 2025, below the maximum covenant requirement of 4.50 to 1.00 [264]. - The company paid dividends of $89 million through the first nine months of both 2025 and 2024 [283]. - The company’s non-GAAP Consolidated Adjusted EBITDA from continuing operations was $287.5 million for the three months ended September 30, 2025, a 4.2% increase from $276.0 million in 2024 [195]. - Adjusted EBITDA margin for the Non-GAAP Consolidated Adjusted EBITDA was 21.3% in Q3 2025, up from 20.5% in Q3 2024 [248].

Revenue and Growth - Total revenue for the three months ended September 30, 2025, was $10,227,000, representing a 15% increase from $8,925,000 in the same period of 2024[116]. - Annual Recurring Revenue (ARR) as of September 30, 2025, was approximately $38.7 million, reflecting a 7% year-over-year increase[107]. - Revenue from the Partner and Marketplace channel grew by 11% to $16,501,000 for the nine months ended September 30, 2025, while Enterprise channel revenue increased by 26% to $13,316,000[109]. - As of September 30, 2025, annual recurring revenue (ARR) was $38.7 million, representing a 7% year-over-year increase driven by growth in both Partner and Marketplace channel and Enterprise channel[135]. Customer Metrics - The number of customers decreased by 2% to approximately 123,000 as of September 30, 2025, down from 126,000 a year earlier[108]. Profitability - Gross profit for the three months ended September 30, 2025, was $7,915,000, an 11% increase from $7,102,000 in the prior year[120]. - The net loss for the three months ended September 30, 2025, was $554,000, a 54% improvement compared to a net loss of $1,202,000 in the same period of 2024[116]. Operating Expenses - Total operating expenses for the nine months ended September 30, 2025, were $24,288,000, a 9% increase from $22,249,000 in the same period of 2024[116]. - Selling and marketing expenses increased by 22% to $11,169,000 for the nine months ended September 30, 2025, compared to $9,122,000 in the prior year[112]. - Selling and marketing expenses increased by 16% to $3,649,000 for the three months ended September 30, 2025, and by 22% to $11,169,000 for the nine months ended September 30, 2025, compared to the prior year periods[123][124]. - Research and development expenses accounted for 16% of total revenue in the nine months ended September 30, 2025[111]. - Research and development expenses decreased by 3% to $1,118,000 for the three months ended September 30, 2025, and by 6% to $3,471,000 for the nine months ended September 30, 2025, compared to the prior year periods[125][126]. - General and administrative expenses decreased by 8% to $3,506,000 for the three months ended September 30, 2025, but increased by 16% to $10,998,000 for the nine months ended September 30, 2025, compared to the prior year periods[127][128]. Financial Position - Working capital as of September 30, 2025, was $(23,000), a decrease of $0.6 million from December 31, 2024, primarily due to a portion of the term loan classified as a current liability[136]. - The company had $4,550,000 in cash and cash equivalents as of September 30, 2025[136]. Cash Flow - In the nine months ended September 30, 2025, cash provided by operating activities increased to $2,220,000, primarily due to no payments towards contingent consideration in the current year[141]. Other Financial Metrics - The change in fair value of contingent consideration showed a significant increase of 11,150% to $(1,338,000) for the nine months ended September 30, 2025, due to a reduction in estimated earnout payable[129][130]. - Interest expense, net increased by 12% to $(236,000) for the three months ended September 30, 2025, and by 10% to $(709,000) for the nine months ended September 30, 2025, compared to the prior year periods[131][132]. Share Repurchase Program - The company adopted a share repurchase program in January 2025, authorizing the repurchase of up to $12.5 million of common stock, with $3.59 million utilized for repurchases by September 30, 2025[137].

Financial Performance - Year-to-date revenues for Cumberland Pharmaceuticals in 2025 totaled $30.8 million, representing a 12% increase compared to the first nine months of 2024[2] - For Q3 2025, net revenues were $8.3 million, including $1.2 million from Kristalose, $3.2 million from Sancuso, $2.6 million from Vibativ, and $0.9 million from Caldolor[17] - The company reported a year-to-date net loss of approximately $1.4 million and a Q3 net loss of approximately $1.9 million[18] - Net revenues for Q3 2025 were $8.29 million, a decrease of 8.7% compared to $9.09 million in Q3 2024[39] - The net loss attributable to common shareholders for Q3 2025 was $1.94 million, compared to a loss of $1.54 million in Q3 2024, reflecting an increase in losses of 25.7%[39] - For the nine months ended September 30, 2025, the net loss attributable to common shareholders was $1,424,436, or $0.09 per share, compared to a net loss of $4,575,956, or $0.32 per share for the same period in 2024[45] - Adjusted diluted earnings for the nine months ended September 30, 2025, were $1,918,675, or $0.13 per share, compared to an adjusted loss of $720,032, or $0.05 per share for the same period in 2024[45] Assets and Liabilities - Cumberland ended Q3 2025 with approximately $66 million in total assets, $40 million in liabilities, and $26 million in shareholders' equity[3] - Total assets decreased to $65.90 million as of September 30, 2025, down from $75.58 million at the end of 2024, representing a decline of 13.0%[37] - Total liabilities decreased to $40.10 million as of September 30, 2025, down from $53.04 million at the end of 2024, a reduction of 24.4%[37] - Cash and cash equivalents at the end of Q3 2025 were $15.20 million, down from $17.96 million at the beginning of the period, indicating a decrease of 15.5%[41] Clinical Developments - The Phase II FIGHT DMD trial for ifetroban showed a 5.4% improvement in cardiac function in patients with Duchenne muscular dystrophy[13] - Cumberland has ongoing clinical studies for ifetroban in patients with Systemic Sclerosis and Idiopathic Pulmonary Fibrosis[15][16] Partnerships and Product Launches - Cumberland announced a partnership with RedHill Biopharma to jointly commercialize Talicia, with Cumberland investing $4 million for a 30% ownership stake in the new company, Talicia Holdings, Inc.[5] - Vibativ was launched in Saudi Arabia through an agreement with Tabuk Pharmaceutical Manufacturing Company, which has exclusive distribution rights in Saudi Arabia and Jordan[8] - Cumberland's ibuprofen injection product received regulatory approval in Mexico, with PiSA Farmaceutica responsible for its registration and commercialization[8] Financial Adjustments and Management Insights - The adjusted loss for Q3 2025 was $0.8 million, or $0.06 per share, while adjusted earnings for the first nine months were $1.9 million, or $0.13 per diluted share[18] - Management emphasizes the importance of adjusted financial measures as they provide insight into the company's operating performance excluding non-core items[48] - The company utilizes net operating loss carryforwards to minimize income tax expenses, reflecting a strategic approach to financial management[48] - Adjusted earnings are defined as net income (loss) adjusted for income taxes, depreciation, amortization, share-based compensation, interest income, and interest expense[49] - The company believes that presenting supplemental financial measures offers greater transparency and consistency in evaluating operating performance across reporting periods[48] - Management encourages investors to review the complete consolidated financial statements for a comprehensive understanding of the company's financial position[47]

Financial Performance - Total revenue for Q3 2025 reached $1,001.3 million, a 120.6% increase compared to $453.8 million in Q3 2024, driven by the acquisition of Marel which contributed $536.5 million[154] - Gross profit for the quarter was $359.8 million, with a gross profit margin of 35.9%, consistent with the same period last year[157] - Operating income for Q3 2025 was $102.1 million, reflecting a 118.2% increase from $46.8 million in Q3 2024[154] - Net income for the quarter was $66.0 million, a 69.7% increase compared to $38.9 million in the same quarter last year[154] - Adjusted EBITDA for Q3 2025 was $170.9 million, compared to $81.7 million in Q3 2024, representing an increase of 109.2%[165] - Total revenue for the nine months ended September 30, 2025, increased by $1,541.8 million or 123.5% compared to the same period in 2024[170] - JBT revenue for the nine months ended September 30, 2025, was $1,328.2 million, a 6.4% increase from $1,248.4 million in 2024[168] - Marel revenue contributed $1,462.0 million in the nine months ended September 30, 2025, with a favorable foreign currency translation impact of approximately $19.3 million[170] - Adjusted EBITDA from continuing operations for Q3 2025 was $170.9 million, significantly up from $81.7 million in Q3 2024, and for the nine months ended September 30, 2025, it reached $439.3 million compared to $202.8 million in 2024[189] Expenses and Costs - Selling, general and administrative expenses increased by $110.4 million to $222.0 million, primarily due to the Marel acquisition, but as a percentage of revenue, it decreased to 22.2% from 24.6%[158] - Research and development expenses rose by $23.3 million to $28.7 million, largely due to costs associated with the Marel business[159] - Selling, general and administrative expenses increased by $428.4 million, with expenses as a percentage of revenue rising to 27.0% from 26.1% year-over-year[172] - Research and development expenses increased by $75.6 million, primarily due to costs associated with the Marel acquisition[173] - Interest expense increased by $87.8 million due to a higher average debt balance and interest rates related to the Marel acquisition[178] Income and Loss - Income from continuing operations for Q3 2025 was $66.8 million, up from $38.1 million in Q3 2024, an increase of 75.3%[164] - Loss from continuing operations for the nine months ended September 30, 2025, was $102.8 million, compared to income of $91.5 million in 2024, a decrease of $194.3 million[181] - Income from continuing operations for Q3 2025 was $66.8 million, compared to $38.1 million in Q3 2024, while the nine-month loss from continuing operations was $(102.8) million, down from $91.5 million in the same period last year[189] Cash Flow and Liquidity - Free cash flow for the nine months ended September 30, 2025, was $163.0 million, an increase of $83.8 million compared to $79.2 million in the same period of 2024[195] - Total operating cash flows from continuing operations for the nine months ended September 30, 2025, were $224.3 million, with expectations of generating positive cash flows for the full year[203] - Cash provided by continuing operating activities for the nine months ended September 30, 2025 was $224.3 million, a $120.4 million increase from $103.9 million in 2024[208] - Cash required by continuing investing activities surged to $1,811.3 million in 2025, compared to only $31.8 million in 2024, primarily due to the acquisition of Marel[209] - Cash provided by financing activities was $490.9 million in 2025, a significant increase from cash required of $23.1 million in 2024, driven by net proceeds from Term Loan B and convertible notes[210] - As of September 30, 2025, the company had $114.9 million in cash and cash equivalents, with $102.8 million held by foreign subsidiaries[206] - Liquidity as of September 30, 2025, was $1.9 billion, including cash and borrowing ability under existing revolving credit facilities[203] - As of September 30, 2025, the company had $62.7 million drawn on its revolving credit facility with $1.7 billion available[211] - The company was in compliance with all covenants in its Second A&R Credit Agreement as of September 30, 2025[212] Restructuring and Integration - The total cost of the 2022/2023 restructuring plan was $17.5 million, completed by March 31, 2024, while the JBT Marel 2025 Integration restructuring plan is estimated to cost between $30.0 million and $35.0 million[196][197] - Cumulative cost savings from the JBT Marel 2025 Integration restructuring plan are expected to be between $50.0 million and $60.0 million, with approximately $10.0 million expected to be realized during the remainder of 2025[198] - The company closed the Marel Transaction on January 2, 2025, acquiring approximately 97.5% of Marel's equity for $983.7 million in cash consideration[202] Market and Orders - Orders remained strong, particularly in the poultry, pharmaceutical, and pet food markets, indicating healthy demand[151] - The Marel Transaction, completed on January 2, 2025, aims to create a leading global food and beverage technology solutions provider[150] Tax and Regulatory - The effective tax rate for income from continuing operations was 20.4% for Q3 2025, slightly up from 20.0% in Q3 2024[163] - The company anticipates that 2025 performance will be affected by evolving tariff costs and is taking proactive measures to mitigate these impacts[152] Debt and Hedging - Approximately 50% of the total gross outstanding debt of $1,937.0 million was variable rate debt as of September 30, 2025[218] - The company entered into five cross-currency swaps with a combined notional amount of $696.5 million to hedge the impact of variability in exchange rates on U.S. dollar denominated debt[219] - A hypothetical 10% adverse movement in currency exchange rates underlying the cross-currency swaps would have resulted in a loss in value of $65.9 million[225] - The company entered into a series of cross-currency swaps with an aggregate notional amount of $2.1 billion to hedge currency exchange components of net investments in foreign subsidiaries[226]

Financial Performance - Net sales for the three months ended September 30, 2025, increased by 22.1% to $285.3 million compared to $233.7 million in the same period of 2024[87] - Gross profit for the same quarter rose by 23.9% to $115.4 million, up from $93.2 million year-over-year[87] - Net income for the three months ended September 30, 2025, was $51.8 million, reflecting a 27.7% increase from $40.6 million in the prior year[87] - EBITDA for the third quarter of 2025 was $86.4 million, a 27.2% increase compared to $67.9 million in the same quarter of 2024[87] - For the nine months ended September 30, 2025, net sales were $1.01 billion, a 3.0% increase from $983.8 million in the same period of 2024[87] - Net income for the nine months ended September 30, 2025, was $188.1 million, a decrease of 13.2% from $216.6 million in the prior year[87] - Total net sales for the nine-month period increased by $29.3 million, or 3%, to $1,013.1 million, primarily driven by products introduced within the last 36 months[100] - Total EBITDA for the nine-month period decreased by 9.3% to $300.5 million compared to $331.4 million in the 2024 period, driven by lower gross profit and higher expenses[108] Expenses and Costs - Selling, general and administrative expenses increased by $6.1 million, or 15.8%, to $45.0 million, representing 15.8% of net sales in the 2025 quarter[97] - Selling, general and administrative expenses for the nine-month period increased by $16.1 million, or 11.5%, to $156.8 million, representing 15.5% of net sales[104] - Gross profit for the nine-month period decreased by $19.6 million, or 4.6%, to $411.3 million, with a gross margin of 40.6% compared to 43.8% in the 2024 period[101] Capital Expenditures - Capital expenditures for the nine months ended September 30, 2025, totaled $188 million, primarily for the Arkansas manufacturing facility and digital transformation initiatives[87] - Capital expenditures for the nine months ended September 30, 2025, totaled $188 million, including $144.2 million for the Arkansas manufacturing facility and $8.3 million for digital transformation[111] - The company anticipates capital expenditures of $210 million to $220 million for 2025, focusing on internal growth, manufacturing cost reductions, and strategic acquisitions[128] - The company has invested $519 million of the anticipated $550 million on the Arkansas facility as of the reporting date[129] Cash Flow and Debt - Net cash provided by operating activities was $292.6 million for the nine-month period, compared to $152.4 million in the 2024 period[109] - Cash provided by operations increased by $140.2 million to $292.6 million for the nine months ended September 30, 2025, compared to $152.4 million in the same period of 2024, primarily due to a decrease in inventories[110] - As of September 30, 2025, the company had $111.3 million in borrowings outstanding under its revolving credit facility, with total availability of $435.6 million after accounting for outstanding letters of credit[125] - The company is in compliance with all debt covenants as of September 30, 2025, which is crucial for maintaining its borrowing capacity[126] Product Development and Market Expansion - The company launched the Trex® Deck Railing Designer, an interactive design tool aimed at simplifying the railing selection process for consumers and contractors[86] - Trex expanded its market presence in the Western U.S. through a partnership with International Wood Products, LLC, which will stock Trex products in Salt Lake City, Utah[86] Warranty and Claims Management - The company’s warranty period for products sold after January 1, 2023, includes a 50-year warranty for Transcend® decking and a 35-year warranty for Select® decking[132] - The company continues to monitor and settle warranty claims related to decking products manufactured prior to 2007, maintaining a warranty reserve for these claims[135] Seasonal Demand Management - Seasonal demand fluctuations are managed through incentive programs for distributors to build inventory before peak demand periods[136] Taxation - The effective tax rate for the 2025 quarter was 26.5%, up from 25.3% in the 2024 quarter, primarily due to a reduction in allowable deductions[98]

Financial Performance - Third quarter revenue increased by 27.6% year-over-year to $200.1 million, compared to $156.8 million in the same quarter of 2024[4] - Revenue less ancillary services increased by 28.2% to $194.1 million in Q3 2025, compared to $151.4 million in Q3 2024[6] - Flywire reported Q3 2025 revenue of $200.1 million, a 27.5% increase from $156.8 million in Q3 2024[24] - Net income for Q3 2025 was $29.6 million, a decrease of 23.4% compared to $38.9 million in Q3 2024[34] - Adjusted EBITDA increased to $57.1 million in Q3 2025, compared to $42.2 million in Q3 2024, with an adjusted EBITDA margin of 29.4%[6] - Adjusted EBITDA for Q3 2025 reached $57.1 million, up 35.2% from $42.2 million in Q3 2024[34] - Net income for the nine months ended September 30, 2025, was $13.464 billion, down from $18.799 billion in 2024, representing a decrease of approximately 28.5%[28] - Revenue for the nine months ended September 30, 2025, increased to $465.5 million, a 24.2% increase from $374.6 million in 2024[30] - Adjusted gross profit for the nine months ended September 30, 2025, was $287.9 million, compared to $237.3 million in 2024, reflecting a growth of 21.4%[30] Client Acquisition and Growth - The company signed over 200 new clients across all verticals in Q3 2025, excluding Sertifi properties[6] - Sertifi contributed $12.9 million to revenue in Q3 2025, adding 8 points of revenue growth year-over-year[4] - Flywire anticipates FX-neutral revenue less ancillary services growth of 23-25% year-over-year for FY 2025[8] Expenses and Liabilities - Total operating expenses for Q3 2025 were $167.9 million, up from $136.5 million in Q3 2024, representing a 22.9% increase[24] - Flywire's total liabilities rose to $430.7 million as of September 30, 2025, compared to $307.7 million at the end of 2024[26] - The company paid down $45 million of debt related to the Sertifi acquisition, with $15 million remaining as of the end of Q3 2025[6] Cash Flow and Investments - Cash flows from operating activities for the nine months ended September 30, 2025, were $95.289 million, down from $127.221 million in 2024, a decrease of approximately 25.1%[28] - The company reported a net cash used in investing activities of $191.168 million for the nine months ended September 30, 2025, compared to $204.582 million in 2024[28] - The company acquired businesses net of cash acquired for $324.921 million during the nine months ended September 30, 2025, significantly higher than $45.438 million in 2024[28] Share Repurchase and Stock Performance - The company repurchased approximately 0.8 million shares for about $10 million, with $192 million remaining in the share repurchase program[6] - The company repurchased common stock amounting to $64.319 million during the nine months ended September 30, 2025, compared to $22.883 million in 2024[28] Market Outlook and Strategy - Flywire raised its FY 2025 revenue guidance by 400 bps at midpoint and adjusted EBITDA margin guidance by 75 bps at midpoint[1] - Flywire's Adjusted EBITDA margin growth expectations remain positive despite current market challenges[21] - The company is focusing on cross-border expansion and enhancing its client base in the business-to-business sector[21] - Flywire plans to continue developing new solutions and services to meet anticipated technology needs in the financial services sector[21]

Commodity Price Risk - The company reported a significant exposure to commodity price risk, with potential unrealized gains or losses impacting pre-tax net earnings by up to $54 million for a 10% increase in oil prices and $51 million for a 10% decrease [290]. - The company is focused on managing ongoing market risk exposures related to oil, NGL, and natural gas prices, as well as foreign currency exchange rates and interest rates [289]. - The company may enter into various derivative financial instruments to mitigate exposure to commodity price risk, governed by formal policies established by the Board of Directors [289]. Foreign Exchange Risk - The company experienced a foreign exchange impact, with a potential unrealized gain of $34 million and a loss of $42 million from a 10% fluctuation in foreign currency exchange rates [296]. - The company has not entered into any U.S. dollar denominated currency swaps as of September 30, 2025, to mitigate foreign exchange risks [294]. - The company’s financial results are significantly affected by fluctuations in the exchange rate between the U.S. and Canadian dollars, given its operations in both countries [291]. Interest Rate Risk - As of September 30, 2025, the company had floating rate borrowings of $360 million, with a sensitivity of $4 million for each 1% change in interest rates [298]. Operating and Capital Expenses - The company’s capital investment decreased by $1 million and transportation and processing expenses decreased by $3 million compared to the previous period [293]. - The company’s operating expenses decreased by $1 million, while administrative expenses decreased by $3 million compared to the same period last year [293]. - The company’s depreciation, depletion, and amortization expenses decreased by $1 million for the three months ended September 30, 2025 [293].