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Quest Resource (QRHC) - 2025 Q1 - Quarterly Report

Financial Performance - Revenue for Q1 2025 was $68.4 million, a decrease of $4.2 million, or 5.8%, compared to $72.7 million in Q1 2024[82] - Gross profit for Q1 2025 was $10.9 million, with a gross profit margin of 16.0%, down from $14.0 million and 19.3% in Q1 2024[85] - Net loss for Q1 2025 was $10.4 million, compared to a net loss of $0.7 million in Q1 2024, resulting in a loss per share of $(0.50) versus $(0.03) in the prior year[96][98] - Adjusted net income (loss) for Q1 2025 was $(2.9) million, a decrease from $1.7 million in Q1 2024[103] - Reported net loss for Q1 2025 was $(10.4) million, compared to $(0.7) million in Q1 2024[104] - Adjusted net income (loss) per diluted share for Q1 2025 was $(0.14), down from $0.08 in Q1 2024[104] Operating Expenses - Operating expenses increased to $19.1 million in Q1 2025 from $12.2 million in Q1 2024, primarily due to higher selling, general, and administrative expenses[88] - Adjusted EBITDA for Q1 2025 decreased 69.6% to $1.6 million from $5.1 million in Q1 2024[100] - The company recorded a $1.7 million impairment charge for certain customer relationship intangible assets in Q1 2025[92] Revenue Changes - New clients contributed approximately $11.0 million in revenue, while lost customers accounted for a $7.0 million decline in revenue[83] - The company experienced a $4.4 million loss on the sale of assets related to its mall business, with a total selling price of approximately $5.0 million[92] Cash Flow and Working Capital - Working capital as of March 31, 2025, was $21.6 million, down from $30.7 million as of December 31, 2024[105] - Net cash used in operating activities for Q1 2025 was $(1.1) million, an improvement from $(1.7) million in Q1 2024[109] - Cash provided by investing activities for Q1 2025 was $4.5 million, primarily from the sale of business assets[112] - Net cash used in financing activities for Q1 2025 was $(2.5) million, primarily due to repayments of notes payable[113] - Company has $1.4 million in cash and cash equivalents and $45.0 million available under its ABL Facility as of March 31, 2025[107] - Company believes existing cash and expected operational cash flow will be sufficient to fund operations for the next 12 months[107] - Company has no off-balance sheet debt or similar obligations[118] Interest and Cost Management - Interest expense decreased to $2.3 million in Q1 2025 from $2.5 million in Q1 2024, primarily due to lower interest rates[93] - The company anticipates realizing cost savings from headcount reductions beginning in Q2 2025 as part of operational efficiency initiatives[89]