Falcon's Beyond (US:FBYD)2026-03-30 21:32Acquisitions and Investments - The Company acquired certain tangible assets and a portfolio of intellectual property from Oceaneering Entertainment Systems for $1.6 million, expanding its attractions services business [379]. - The Company has been engaged in expanding operations through equity method investments and acquiring businesses, despite incurring losses from operations [383]. - The Company has a 50% interest in the PDP joint venture, which operates one hotel resort and theme park in Mallorca, Spain [380]. - The Company recognized a $1.1 million gain on bargain purchase from the OES Acquisition for the year ended December 31, 2025 [432]. - The company recognized an other-than-temporary impairment charge of $5.3 million for its investment in PDP for the year ended December 31, 2025 [476]. - The fair value of the company's investment in Karnival was determined to be $4.2 million, with an impairment charge of $3.0 million recognized for the year ended December 31, 2025 [478]. Financial Performance - Revenue for the year ended December 31, 2025, was $14.896 billion, an increase of $8.151 billion compared to $6.745 billion in 2024 [417]. - The Company’s net income for the year ended December 31, 2025, was $6.312 million, a decrease of $143.169 million compared to $149.481 million in 2024 [417]. - Total segment loss from operations was $1.121 million for 2025, compared to a loss of $134, indicating a deterioration of $987 million [434]. - Falcon's Attractions segment reported a loss of $3.260 million in 2025, reflecting a significant operational challenge [440]. - The Company recognized a gain of $172.3 million related to the change in fair value of earnout liabilities for the year ended December 31, 2024 [413]. - The share of gain from equity method investments increased by $20.08 million for the year ended December 31, 2025, driven by a gain from the sale of a subsidiary [424]. Expenses and Costs - Selling, general and administrative expenses increased by $3.088 million for the year ended December 31, 2025, primarily due to payroll and marketing expenses [420]. - Interest expense increased by $1.486 million for the year ended December 31, 2025, primarily due to rising interest rates on debt [427]. - Project design and build expenses increased by $2.373 million for the year ended December 31, 2025, due to new attractions service contracts [418]. - The Company incurred $8.3 million in impairment losses for equity method investments during the year ended December 31, 2025 [406]. Cash Flow and Financing - Cash used in operating activities for the year ended December 31, 2025, was $24.6 million, an increase of $12.1 million compared to 2024 [459]. - Cash provided by investing activities increased to $24.2 million for the year ended December 31, 2025, primarily due to a $27.0 million dividend distribution from PDP [462]. - Cash provided by financing activities decreased to $3.7 million for the year ended December 31, 2025, compared to $12.9 million in 2024, with net repayments of $6.9 million of debt [463]. - The company issued $32.5 million of preferred stock, raising $11.8 million in cash and exchanging $20.5 million of outstanding debt to fund its attractions division expansion [384]. - The company issued $32.5 million of Series B Preferred Stock during 2025, raising $11.8 million in cash and exchanging $20.7 million of outstanding debt [447]. Working Capital and Debt - As of December 31, 2025, the Company reported a working capital deficiency of $18.1 million, including $0.6 million of matured debt [385]. - Total indebtedness as of December 31, 2025, was approximately $15.6 million, with $1.9 million in cash and $15.5 million available for borrowing [448]. - As of December 31, 2025, the company has $16.4 million in accrued expenses and current liabilities, including $14.4 million in transaction-related fees [450]. - The company has a total outstanding balance of $5.0 million with Infinite Acquisitions as of December 31, 2025 [456]. Future Outlook and Compliance - The Company expects research and development expenses to increase as it continues to invest in new product offerings across various sectors [401]. - The company expects its capital expenditures and working capital requirements to increase materially in the near future due to various operational factors [451]. - The Company is classified as an "emerging growth company" under the JOBS Act, allowing it to delay compliance with new accounting standards until they apply to private companies [482]. - The Company has elected to use the extended transition period for accounting standards under the JOBS Act, which may complicate financial statement comparisons with other public companies [483]. - The Company will maintain its status as an emerging growth company until it meets specific revenue or market value thresholds, including total annual revenue of at least $1.235 billion or a market value exceeding $700 million [484]. - The Company is also classified as a "smaller reporting company," which allows it to provide reduced disclosure obligations, including only two years of audited financial statements [485]. - The Company will retain its smaller reporting company status until it exceeds a market value of $250 million or annual revenue of $100 million, along with a market value exceeding $700 million [485]. - As a smaller reporting company, the Company is not required to provide certain market risk disclosures [486].