Biglari (BH_A) - 2025 Q2 - Quarterly Report

PART I – FINANCIAL INFORMATION This section presents the unaudited consolidated financial statements, management's analysis, market risk disclosures, and internal controls for Biglari Holdings Inc ITEM 1. FINANCIAL STATEMENTS Presents Biglari Holdings Inc.'s unaudited consolidated financial statements, notes on accounting policies, and segment performance for the specified periods Consolidated Balance Sheets Total Assets, Liabilities, and Shareholders' Equity | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--------------------------------- | :----------------------------- | :------------------------------- | | Total Assets | $863,579 | $866,133 | | Total Liabilities | $274,293 | $293,172 | | Biglari Holdings Inc. Shareholders' Equity | $589,286 | $572,961 | | Cash and cash equivalents | $32,766 | $30,709 | | Line of credit (current portion) | $19,000 | $35,000 | Consolidated Statements of Earnings Net Earnings (Loss) | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Second Quarter | $50,931 | $(48,190) | | First Six Months | $17,656 | $(25,611) | Total Revenues | Period | 2025 (in thousands) | 2024 (in thousands) | Change (YoY) | | :------------------- | :------------------ | :------------------ | :----------- | | Second Quarter | $100,619 | $91,141 | +10.4% | | First Six Months | $195,654 | $180,592 | +8.3% | Investment Partnership Gains (Losses) | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Second Quarter | $58,504 | $(79,890) | | First Six Months | $8,912 | $(57,905) | Net Earnings (Loss) per Average Equivalent Class A Share | Period | 2025 | 2024 | | :------------------- | :------- | :-------- | | Second Quarter | $194.57 | $(171.89) | | First Six Months | $67.26 | $(90.80) | Consolidated Statements of Comprehensive Income Comprehensive Income (Loss) | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Second Quarter | $51,941 | $(48,308) | | First Six Months | $19,136 | $(25,760) | Foreign Currency Translation | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Second Quarter | $1,010 | $(118) | | First Six Months | $1,480 | $(149) | Consolidated Statements of Cash Flows Cash Flow Activities (First Six Months) | Activity | 2025 (in thousands) | 2024 (in thousands) | | :------------------------------------------ | :------------------ | :------------------ | | Net cash provided by operating activities | $57,942 | $20,910 | | Net cash used in investing activities | $(27,161) | $(19,586) | | Net cash used in financing activities | $(28,778) | $(2,691) | | Increase (decrease) in cash, cash equivalents and restricted cash | $2,045 | $(1,374) | Consolidated Statements of Changes in Shareholders' Equity Shareholders' Equity Balances | Date | Total Shareholders' Equity (in thousands) | | :----------------- | :-------------------------------------- | | June 30, 2025 | $589,286 | | June 30, 2024 | $569,179 | | December 31, 2024 | $572,961 | | December 31, 2023 | $599,330 | - Net earnings (loss) for the second quarter of 2025 was $50,931 thousand, a significant improvement from a loss of $(48,190) thousand in the second quarter of 2024[21] Notes to Consolidated Financial Statements Note 1. Summary of Significant Accounting Policies - Biglari Holdings Inc. is a holding company with diverse business activities including property and casualty insurance and reinsurance, licensing and media, restaurants, and oil and gas[23] - Sardar Biglari, Chairman and CEO, makes all major investment and capital allocation decisions for the Company and its subsidiaries[24] - As of June 30, 2025, Mr. Biglari beneficially owns approximately 74.3% of the Company's voting interest[25] Note 2. Earnings Per Share Equivalent Class A Common Stock for EPS Calculation | Period | 2025 | 2024 | | :------------------------------------------ | :----- | :----- | | Equivalent Class A common stock outstanding | 620,592 | 620,592 | | Proportional ownership of Company stock held by investment partnerships | 358,832 | 340,232 | | Equivalent Class A common stock for earnings per share | 261,760 | 280,360 | Note 3. Investments Investment Gains (Losses) | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Second Quarter | $2,925 (gain) | $(2,729) (loss) | | First Six Months | $1,340 (gain) | $(1,016) (loss) | - Investment gains and losses, whether realized or unrealized, are considered non-operating[31] Note 4. Investment Partnerships Gains (Losses) from Investment Partnerships | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Second Quarter | $58,504 (gain) | $(79,890) (loss) | | First Six Months | $8,912 (gain) | $(57,905) (loss) | Carrying Value of Investment Partnerships | Date | Carrying Value (in thousands) | | :----------------- | :-------------------------- | | June 30, 2025 | $202,893 | | December 31, 2024 | $201,727 | - Biglari Holdings' ownership interest in The Lion Fund increased to 91.6% as of June 30, 2025, from 90.2% as of June 30, 2024. Ownership in The Lion Fund II increased to 87.8% from 87.3% over the same period[44] - No incentive reallocations were accrued during the first six months of 2025 and 2024[42] Note 5. Property and Equipment Property and Equipment, Net | Date | Amount (in thousands) | | :----------------- | :-------------------- | | June 30, 2025 | $365,262 | | December 31, 2024 | $376,155 | - The Company recorded an impairment of $1,251 thousand to restaurant long-lived assets related to underperforming stores in both the second quarter and first six months of 2025[47] - Abraxas Petroleum recorded gains of $794 thousand in Q2 2025 and $10,117 thousand in 6M 2025 from selling undeveloped reserves[49] Note 6. Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets | Asset Type | June 30, 2025 (in thousands) | December 31, 20