Arq(US:ARQ)2025-08-11 20:31PART I. - FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements Unaudited consolidated financial statements and notes detail balance sheets, operations, equity, cash flows, organization, and accounting policies Condensed Consolidated Balance Sheets Assets and liabilities slightly increased, equity decreased, cash significantly reduced, and receivables/inventories rose from December 2024 to June 2025 Condensed Consolidated Balance Sheets Data | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :------------------------------- | | ASSETS | | | | Cash | $6,957 | $13,516 | | Receivables, net | $15,547 | $14,876 | | Inventories, net | $20,778 | $19,314 | | Total current assets | $50,664 | $52,356 | | Total Assets | $284,541 | $284,368 | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | Total current liabilities | $46,168 | $44,653 | | Total Liabilities | $67,773 | $67,092 | | Total Stockholders' Equity | $216,768 | $217,276 | Condensed Consolidated Statements of Operations The company reported improved net losses for both three and six months ended June 30, 2025, driven by increased revenue despite rising operating expenses Condensed Consolidated Statements of Operations Data | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Revenue | $28,584 | $25,405 | $55,831 | $47,145 | | Cost of revenue, exclusive of depreciation and amortization | $19,066 | $17,227 | $36,398 | $30,940 | | Selling, general and administrative | $5,918 | $7,011 | $11,971 | $14,677 | | Research and development | $2,697 | $929 | $3,571 | $2,554 | | Depreciation, amortization, depletion and accretion | $2,485 | $1,658 | $4,666 | $3,374 | | Operating loss | $(1,555) | $(1,420) | $(893) | $(4,400) | | Net loss | $(2,133) | $(1,968) | $(1,930) | $(5,387) | | Loss per common share (Basic) | $(0.05) | $(0.06) | $(0.05) | $(0.16) | | Loss per common share (Diluted) | $(0.05) | $(0.06) | $(0.05) | $(0.16) | Condensed Consolidated Statements of Changes in Stockholders' Equity Total stockholders' equity slightly decreased from January 1, 2025, to June 30, 2025, due to net loss, partially offset by stock-based compensation Condensed Consolidated Statements of Changes in Stockholders' Equity Data | Metric | Balances, January 1, 2025 (in thousands) | Balances, June 30, 2025 (in thousands) | Balances, January 1, 2024 (in thousands) | Balances, June 30, 2024 (in thousands) | | :------------------------ | :--------------------------------------- | :------------------------------------- | :--------------------------------------- | :------------------------------------- | | Total Stockholders' Equity | $217,276 | $216,768 | $178,400 | $189,600 | | Stock-based compensation (6 months) | N/A | $1,470 | N/A | $1,435 | | Net loss (6 months) | N/A | $(1,930) | N/A | $(5,387) | Condensed Consolidated Statements of Cash Flows Cash and restricted cash decreased due to increased operating cash outflow and reduced financing cash inflow, despite lower investing cash outflow Condensed Consolidated Statements of Cash Flows Data | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------ | :-------------------------------------------- | :-------------------------------------------- | | Net cash used in operating activities | $(5,276) | $(2,424) | | Net cash used in investing activities | $(5,530) | $(28,851) | | Net cash provided by financing activities | $3,995 | $14,319 | | Decrease in Cash and Restricted Cash | $(6,811) | $(16,956) | | Cash and Restricted Cash, end of period | $15,424 | $37,197 | Notes to Condensed Consolidated Financial Statements These notes provide detailed explanations and disclosures for the condensed consolidated financial statements, covering business, accounting policies, and specific financial line items Note 1 - Organization and Basis of Presentation Arq, Inc. is an environmental technology company focused on activated carbon products for air, water, and soil treatment, operating in the APT market - Arq, Inc. is an environmental technology company principally engaged in the sale of consumable air, water, and soil treatment solutions, primarily based on activated carbon (AC)22 - The company's primary products are powdered activated carbon (PAC) and granular activated carbon (GAC), and it owns the Five Forks Mine (lignite coal) and a manufacturing facility in Corbin, Kentucky23 Note 1 - Organization and Basis of Presentation Data | 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 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Loss per share - basic | $(0.05) | $(0.06) | $(0.05) | $(0.16) | | Loss per share - diluted | $(0.05) | $(0.06) | $(0.05) | $(0.16) | - Revenue is generally higher in the first and third fiscal quarters due to weather-dependent power generation and increased demand for water purification products during summer/rainy seasons3537 Note 2 - Inventories, net Total inventories, net, increased from $19,314 thousand at December 31, 2024, to $20,778 thousand at June 30, 2025, due to increases in product and raw material inventory Note 2 - Inventories, net Data | Inventory Type | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--------------------- | :----------------------------- | :------------------------------- | | Product inventory, net | $11,813 | $11,166 | | Raw material inventory | $8,965 | $8,148 | | Total inventories, net | $20,778 | $19,314 | Note 3 - Revenue All material revenue performance obligations were satisfied at a point in time, with trade receivables increasing and no material contract assets or liabilities outstanding - All material performance obligations related to revenue recognized were satisfied at a point in time43 Note 3 - Revenue Data | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------- | :----------------------------- | :------------------------------- | | Trade receivables, net | $1