Financial Performance - For the year ended December 31, 2024, the company reported a net loss of $12.366 million, compared to a net loss of $11.047 million in 2023, representing an increase in loss of approximately 11.97%[426]. - Revenue for the year ended December 31, 2024, was $142.408 million, down from $154.943 million in 2023, indicating a decrease of about 8.06%[426]. - The company reported an operating profit of $3.472 million for 2024, compared to $1.117 million in 2023, reflecting an increase of approximately 211.5%[426]. - The company’s accumulated deficit increased from $11.339 million in 2023 to $23.705 million in 2024, representing a growth of approximately 109.5%[425]. - The net loss for the year ended December 31, 2024, was $12,366,000, compared to a net loss of $11,047,000 for 2023, representing an increase in loss of approximately 11.9%[433]. - The Company recorded a net revenue of $8.064 million from discontinued operations for the year ended December 31, 2024, down from $11.393 million in 2023, representing a decrease of approximately 29.5%[449]. - The net loss from discontinued operations, after income taxes, was $5.833 million for 2024, compared to a loss of $5.479 million in 2023, reflecting an increase in loss of approximately 6.4%[449]. Assets and Liabilities - The company's total current assets decreased from $49.867 million in 2023 to $41.338 million in 2024, a decline of approximately 17.3%[425]. - Total liabilities decreased from $115.307 million in 2023 to $109.391 million in 2024, a reduction of about 5.3%[425]. - The company’s cash and cash equivalents increased from $6.537 million in 2023 to $12.099 million in 2024, an increase of approximately 85.5%[425]. - Accounts receivable, net decreased to $19.8 million as of December 31, 2024, down from $30.2 million in 2023[491]. - Total current liabilities held for sale were $2.443 million as of December 31, 2024, compared to $3.818 million in 2023, showing a decrease of approximately 36%[450][451]. - Total accrued liabilities decreased from $23,850 thousand in 2023 to $17,993 thousand in 2024, representing a reduction of about 24.6%[545]. Cash Flow and Financing - Cash used in operating activities for 2024 was $5,227,000, a significant increase from $1,535,000 in 2023[433]. - The Company incurred interest expense of $0.6 million related to the Secured Borrowing Facility in 2023, which was eliminated in 2024[547]. - The outstanding balances payable under the Secured Borrowing Facility decreased from $0.1 million in 2023 to $0 in 2024[547]. - The Company repaid a total of $1.9 million under the Term Loan A Facility, $0.4 million under the Term Loan B Facility, and $6.4 million under the Revolving Credit Facility during the year ended December 31, 2024[551]. - The maturity of the Revolving Credit Facility was further extended to August 31, 2025 on May 10, 2024[551]. Operational Challenges - The company is uncertain about achieving continued and sustained profitability[17]. - The company may need to raise debt or equity financing, which could be on unfavorable terms[18]. - The company's revenues are highly dependent on the banking and finance industries, and any decrease in demand could reduce revenues[24]. - The company faces significant competition, including from clients who may choose to perform business processes in-house[22]. - The company relies on ETI, which is a highly leveraged company facing substantial doubt about its ability to continue as a going concern[18]. - The company may not be able to offset increased costs with increased fees under its contracts[22]. - The company is subject to regular client and third-party security reviews, and failure to pass these may adversely impact operations[27]. - The invasion of Ukraine by Russia and the resulting sanctions have caused significant economic disruption[31]. Shareholder Information - The company does not expect to declare any dividends in the foreseeable future[34]. - The company reported a total of 30,166,102 shares of common stock outstanding following the business combination[444]. - The weighted average common shares outstanding increased from 22,535,920 in 2023 to 30,166,102 in 2024[515]. - Basic and diluted loss per share for continuing operations improved from $(0.25) in 2023 to $(0.22) in 2024[515]. Expenses and Costs - The company incurs significant increased expenses and administrative burdens as a result of being a public company[35]. - The Company recognized stock-based compensation expense of $1,611,000 in 2024, compared to no such expense in 2023[433]. - Research and development expenses were $0.6 million for the year ended December 31, 2024, down from $0.9 million in 2023[502]. - Advertising expenses increased to $0.2 million in 2024 from $0.1 million in 2023[500]. - Restructuring charges for the years ended December 31, 2024 and 2023 were $1.1 million and $4.3 million, respectively[504]. Currency and Translation Adjustments - Foreign currency translation adjustments resulted in a gain of $1.890 million in 2024, compared to a loss of $2.995 million in 2023[429]. - Foreign exchange losses were $2.5 million in 2024, compared to $0.6 million in 2023[512]. - The company’s foreign currency translation adjustment resulted in a loss of $1,416,000 for the year ended December 31, 2023[431]. Goodwill and Impairment - The Company recorded an impairment charge of $0.1 million related to goodwill for the year ended December 31, 2024[449]. - The impairment of goodwill recorded in 2024 was due to the classification of certain operations as held for sale, indicating a significant strategic shift[449]. - The Company recorded a goodwill impairment of $0.1 million in discontinued operations for the year ended December 31, 2024[473].
XBP Europe (XBP) - 2024 Q4 - Annual Report