B. Riley Financial(US:RILY)2026-01-14 21:23Financial Performance - Total revenues increased by $102.5 million to $277.9 million for the three months ended September 30, 2025, compared to $175.4 million for the same period in 2024, representing a 58.5% increase[368]. - Total revenues for the nine months ended September 30, 2025, were $689.2 million, an increase of 21.4% compared to $567.8 million for the same period in 2024[402]. - Net income attributable to common shareholders was $89.1 million, compared to a loss of $286.4 million in the same quarter of 2024, reflecting a change of $375.5 million[365]. - The company generated net income of $220.6 million for the nine months ended September 30, 2025, compared to a net loss of $767.2 million in 2024[439]. Revenue Breakdown - The Capital Markets segment saw a revenue increase of $34.9 million to $65.4 million, primarily due to a rise in corporate finance, consulting, and investment banking fees[370]. - The Wealth Management segment's revenues decreased by $15.0 million to $34.3 million, driven by a reduction in assets under management (AUM) from approximately $25.7 billion in 2024 to $13.3 billion in 2025[371]. - The Communications segment's revenues decreased by $6.9 million to $59.4 million, primarily due to a decline in subscription revenue[372]. - The E-Commerce segment reported no revenues for the three months ended September 30, 2025, following the deconsolidation of Nogin[373]. - Revenues from services and fees in All Other decreased by $11.7 million to $11.6 million for the three months ended September 30, 2025, compared to $23.3 million for the same period in 2024[374]. Investment and Securities - As of September 30, 2025, the total securities and other investments owned amounted to $315.5 million, an increase from $282.3 million as of December 31, 2024, representing a growth of approximately 11.5%[354][355]. - The carrying value of public equity securities was $149.7 million as of September 30, 2025, up from $124.9 million as of December 31, 2024, indicating a growth of about 19.8%[355]. - The carrying value of private equity securities decreased to $99.0 million as of September 30, 2025, down from $107.6 million as of December 31, 2024, reflecting a decline of approximately 7.9%[355][359]. - The carrying value of Babcock & Wilcox Enterprises, Inc. common stock increased to $79.6 million as of September 30, 2025, compared to $45.0 million as of December 31, 2024, marking a significant increase of 76.0%[356]. - The carrying value of Double Down Interactive Co., Ltd common stock decreased to $32.2 million as of September 30, 2025, from $43.7 million as of December 31, 2024, representing a decline of approximately 26.2%[357]. Operational Improvements - The Company aims to maximize free cash flow through operational improvements in acquired companies, targeting attractive risk-adjusted returns[342]. - The Company has a value-oriented investment approach, providing advisory services for complex transactions consistent with this philosophy[347]. - The Company plans to pursue future acquisitions in the Communications Segment to expand its portfolio of businesses[349]. Expenses and Costs - Total operating expenses decreased by $45.1 million to $212.5 million, a reduction of 17.5% compared to the previous year[365]. - Total selling, general and administrative expenses decreased by $64.4 million to $453.6 million, with significant reductions in the Wealth Management and Corporate segments[422]. - Selling, general and administrative expenses in the Capital Markets segment increased by $22.2 million to $53.4 million during the three months ended September 30, 2025, from $31.3 million in the same period of 2024[384]. - Interest expense decreased by 28.9% from $102.2 million in 2024 to $72.7 million in 2025, primarily due to lower debt balances[402]. Cash Flow and Liquidity - Cash used in operating activities was $85.9 million for the nine months ended September 30, 2025, compared to cash provided of $266.3 million for the same period in 2024, a decrease of $352.2 million[451]. - Cash provided by investing activities increased to $275.9 million for the nine months ended September 30, 2025, from $25.5 million in 2024, primarily due to proceeds from the sale of various businesses[452]. - Cash used in financing activities was $261.0 million for the nine months ended September 30, 2025, a decrease of $93.7 million compared to $354.7 million in 2024, mainly due to the suspension of dividends[453]. - The principal sources of liquidity include existing cash, cash flows from operations, and funds available under revolving credit facilities[450]. Changes and Future Outlook - The Company underwent a name change to BRC Group Holdings, Inc. effective January 1, 2026, while retaining its trading symbol "RILY"[360]. - The company expects that current cash, cash equivalents, and available credit will be sufficient to meet working capital and capital expenditure requirements for at least the next 12 months[445]. - Approximately $280.1 million of senior notes are due in the next twelve months, with $1.0 billion due thereafter[444]. - The company continues to monitor financial performance to ensure sufficient liquidity for operations and business plans[446].