B RLY FINCL(US:RILYP)2025-12-15 21:18Financial Performance - The company reported total revenues of $225.3 million for the three months ended June 30, 2025, a 137.4% increase from $94.9 million in the same period of 2024[380]. - Operating income for the three months ended June 30, 2025, was $10.8 million, a significant turnaround from an operating loss of $232.6 million in the same period of 2024[377]. - Net income attributable to B. Riley Financial, Inc. was $139.5 million for the three months ended June 30, 2025, compared to a loss of $433.6 million in the prior year[377]. - Total revenues for the six months ended June 30, 2025, were $411.4 million, an increase of 4.8% compared to $392.5 million for the same period in 2024[419]. - The company generated net income of $129.5 million for the six months ended June 30, 2025, compared to a net loss of $482.8 million in the same period of 2024[457]. Revenue Breakdown - Wealth Management segment total revenues decreased to $38.6 million in Q2 2025 from $50.9 million in Q2 2024, a decline of 24%[383]. - The Capital Markets segment saw a revenue decrease of $46.3 million to $64.3 million, a decline of 41.9% from $110.6 million in the prior year[424]. - Communications segment revenues decreased by $34.9 million to $123.9 million, a decline of 22.0% from $158.8 million in the prior year[426]. - E-Commerce segment revenues increased by 27.0% to $3.5 million, up from $2.7 million in the previous year[422]. - Revenues from services and fees in the Communications segment decreased to $60.7 million in Q2 2025 from $77.7 million in Q2 2024, a decline of 22%[384]. Investment and Securities - As of June 30, 2025, the total securities and other investments owned amounted to $242.4 million, down from $282.3 million as of December 31, 2024, representing a decrease of approximately 14.1%[363][364]. - The carrying value of public equity securities was $88.9 million as of June 30, 2025, compared to $124.9 million as of December 31, 2024, indicating a decline of about 29%[364]. - The carrying value of private equity securities decreased to $97.9 million as of June 30, 2025, from $107.6 million as of December 31, 2024, reflecting a reduction of approximately 9.5%[364][368]. - The carrying value of Babcock & Wilcox Enterprises, Inc. common stock decreased from $45.0 million as of December 31, 2024, to $26.4 million as of June 30, 2025, a decline of approximately 41.1%[365]. - The carrying value of Double Down Interactive Co., Ltd common stock fell from $43.7 million as of December 31, 2024, to $34.5 million as of June 30, 2025, representing a decrease of about 21.1%[366]. Cash Flow and Financing - Cash used in operating activities was $25.4 million for the six months ended June 30, 2025, a decrease of $272.2 million compared to $246.8 million provided in the same period of 2024[469]. - Cash provided by investing activities was $289.2 million for the six months ended June 30, 2025, compared to $6.7 million in the same period of 2024, primarily due to proceeds from business sales[471]. - Cash used in financing activities was $252.4 million for the six months ended June 30, 2025, compared to $243.5 million in the same period of 2024, primarily due to increased debt-related payments[472]. - The Company had borrowings outstanding of $1.5 billion as of June 30, 2025, including $1.3 billion from senior notes with interest rates ranging from 5.00% to 8.00%[463]. - The company expects to utilize existing cash balances and cash generated from operations to fund debt service obligations over the next twelve months[459]. Expenses and Cost Management - Selling, general and administrative expenses decreased by $35.6 million to $142.4 million in Q2 2025 from $178.0 million in Q2 2024, a reduction of 20%[397]. - Total selling, general and administrative expenses decreased by $47.2 million to $309.8 million during the six months ended June 30, 2025, from $356.9 million in the same period of 2024, a reduction of 13.2%[439]. - Direct cost of services decreased by $42.4 million to $75.9 million, primarily due to a $32.9 million decrease in the Communications segment[437]. - Interest expense decreased by $56.0 million to $2.7 million during the six months ended June 30, 2025, from $58.7 million in the same period of 2024, due to a decrease in securities loaned and loan participations sold[447]. - The impairment charge for the Targus tradename was $1.5 million as of June 30, 2025, reflecting a decline in fair value due to market conditions[374]. Future Outlook and Strategic Initiatives - The Company plans to change its name to BRC Group Holdings, Inc., effective January 1, 2026[372]. - The Company anticipates variability in the sale of additional investments over the next twelve months based on economic value realization and liquidity needs[461]. - The company actively monitors interest rate risk and may consider entering into interest rate hedges to mitigate potential risks[476]. - The company maintains a portfolio of cash equivalents and short-term investments, including common stocks and loans receivable, to maximize income while preserving capital[477]. - The Company completed private exchange transactions on July 11, 2025, exchanging Exchanged Notes for approximately $24.6 million aggregate principal amount of New Notes[462].