Quest Resource (US:QRHC)2025-11-10 21:01Revenue Performance - Revenue for Q3 2025 was $63.3 million, a decrease of $9.5 million or 13.0% compared to $72.8 million in Q3 2024[86] - For the nine months ended September 30, 2025, revenue was $191.3 million, down $27.3 million or 12.5% from $218.6 million in the same period of 2024[86] - The decline in Q3 revenue was primarily due to the divestiture of the mall-related business and softness in the industrial end market, reducing revenue by approximately $3.0 million and $6.0 million, respectively[87] Profitability - Gross profit for Q3 2025 was $11.5 million, compared to $11.7 million in Q3 2024, with a gross profit margin improvement to 18.1% from 16.1%[91] - Net loss for Q3 2025 was $(1.3) million, an improvement from a net loss of $(3.4) million in Q3 2024[104] - Adjusted EBITDA for the three months ended September 30, 2025, increased by 15.9% to $2.94 million from $2.53 million in the same period of 2024, while it decreased by 43.9% to $7.18 million for the nine months ended September 30, 2025, from $12.79 million in 2024[108][110] Expenses - Operating expenses for Q3 2025 were $10.4 million, down from $12.6 million in Q3 2024, reflecting efficiency initiatives[94] - Selling, general, and administrative expenses for Q3 2025 were $9.2 million, down from $10.3 million in Q3 2024, due to lower labor-related costs[95] - Interest expense decreased to $2.4 million in Q3 2025 from $2.7 million in Q3 2024, primarily due to lower interest rates[101] Asset and Cash Management - The company recognized a $4.4 million loss on the sale of assets in the nine months ended September 30, 2025, related to the mall-related business[99] - Net cash provided by operating activities was $8.5 million for the nine months ended September 30, 2025, compared to net cash used of $(1.3) million for the same period in 2024[117] - Cash provided by investing activities for the nine months ended September 30, 2025, was $3.9 million, primarily from $5.0 million in proceeds from the sale of mall-related business assets[120] - Net cash used in financing activities for the nine months ended September 30, 2025, was $(11.7) million, primarily from $4.7 million in repayments of notes payable and net repayments of $7.0 million on the ABL Facility[121] Working Capital and Financial Position - As of September 30, 2025, working capital was $13.2 million, including $1.1 million of cash and cash equivalents, down from $30.7 million as of December 31, 2024[113] - The company believes existing cash and cash equivalents, along with borrowing availability under the $45.0 million ABL Facility, will be sufficient to fund operations for the next 12 months[115] Impairment and Losses - The company recorded a $1.7 million impairment charge in Q1 2025 associated with certain customer relationship intangible assets[100] - The company experienced a non-cash impairment loss of $1.7 million and a loss on the sale of assets of $4.3 million during the nine months ended September 30, 2025[124] - Net loss attributable to common stockholders was $(1.35) million for the three months ended September 30, 2025, compared to $(3.39) million for the same period in 2024, and $(13.73) million for the nine months ended September 30, 2025, compared to $(5.56) million for the same period in 2024[106][124] Shareholder Information - The weighted average number of shares outstanding was approximately 21.03 million for the three months ended September 30, 2025, compared to 20.67 million for the same period in 2024[107][112] - Adjusted net loss for the three months ended September 30, 2025, was $(0.4) million, compared to $(1.1) million for the same period in 2024, and $(4.1) million for the nine months ended September 30, 2025, compared to $1.2 million for the same period in 2024[111][112]