Technology and Innovation - Loop Industries has successfully operated its Terrebonne Facility for five years, demonstrating effective monomer recovery and supplying virgin-quality PET resin and polyester fiber to customers[92]. - The Infinite Loop™ Technology allows for the recycling of a wide range of contaminated PET and polyester fiber waste into virgin-quality materials, operating at low temperatures without added pressure[104]. - Loop's depolymerization technology can recycle materials infinitely without degrading quality, addressing the limitations of mechanical recycling[105]. - Loop's technology is designed to handle more contaminated feedstock compared to existing depolymerization methods, enhancing scalability[103]. - The Infinite Loop™ Technology is positioned to respond to the global transition towards a circular economy, focusing on recycling waste polyester that would otherwise be discarded[134]. Business Development and Partnerships - The company is advancing towards constructing an Infinite Loop™ manufacturing facility in India with a planned production capacity of 70,000 tons per year of Loop branded PET resin and polyester fiber[93]. - Loop has sold its first technology license to Reed Management SAS for an initial down payment of €10 million, with additional milestone payments as the project progresses[93]. - The company has entered into an Amended Agreement with Reed Management SAS to develop Infinite Loop™ manufacturing facilities in Europe[108]. - Loop has signed a multi-year offtake agreement with Nike, Inc. to supply agreed minimum volumes of Twist™, a virgin-quality circular polyester resin made exclusively from textile waste[146]. - The Company announced a strategic alliance with Hyosung TNC to expand access to circular polyester through textile-to-textile supply chains[149]. Financial Performance - The Company reported total revenues of $86, an increase of $34 compared to $52 for the same period in 2024, primarily from engineering services provided to the India joint venture[158]. - For the nine-month period ended November 30, 2025, total revenues increased by $257 to $338, compared to $81 for the same period in 2024[165]. - The net loss for the three-month period ended November 30, 2025, decreased by $8,968 to $2,944, compared to $11,912 for the same period in 2024[162]. - The net loss for the nine-month period ended November 30, 2025, decreased by $12,345 to $9,595, compared to $21,940 for the same period in 2024[171]. Expenses and Cash Flow - Research and development expenses decreased by $410 to $967 for the three-month period ended November 30, 2025, compared to $1,377 for the same period in 2024[159]. - General and administrative expenses decreased by $648 to $1,500 for the three-month period ended November 30, 2025, compared to $2,148 for the same period in 2024[160]. - Research and development expenses for the nine-month period ended November 30, 2025, decreased by $2,377 to $3,182, compared to $5,559 for the same period in 2024[167]. - General and administrative expenses for the nine-month period ended November 30, 2025, decreased by $2,636 to $5,018, compared to $7,654 for the same period in 2024[168]. - The Company reported a net cash used in operating activities of $7,372 for the nine months ended November 30, 2025, an improvement from $8,635 in the same period of 2024[190]. Investments and Financing - Loop issued 1,044,430 shares of Series B Convertible Preferred Stock at $10.00 per share to Reed Circular Economy as part of the financing and licensing transactions[109]. - The Company issued 1,044,430 shares of Series B CPS at $10.00 per share, resulting in cash proceeds of $10,395 on December 23, 2024[178]. - The Financing Facility with Investissement Québec has a maximum obligation of $3,291, with total disbursements of $3,290 received by the Company[179]. - The interest rate on the Financing Facility was increased from 2.36% to 4.36% through multiple amendments, with the latest amendment on February 5, 2025[182]. - The Company has approximately $14.1 million of capacity remaining under the At-the-Market Equity Offering as of November 30, 2025[153].

Financial Performance - Kuvatris Therapeutics, Inc. reported a net loss of approximately $876,642 for the three months ended September 30, 2024, compared to a net loss of $5,049,218 for the same period in 2023, indicating a significant reduction in losses [128]. - Total operating expenses for the three months ended September 30, 2024, were approximately $887,937, down from $4,364,521 in the same period of 2023, reflecting a decrease of about 80.7% [128]. - General and administrative expenses for the nine months ended September 30, 2024, were approximately $5.6 million, down from $9.0 million in 2023, a decrease of about 37% [136]. - Net cash used in operating activities for the nine months ended September 30, 2024, was $5.0 million, compared to $8.2 million for the same period in 2023 [152][153]. - The company reported an accumulated deficit of approximately $59.6 million since inception, with no revenue generated from product sales [142]. Research and Development - Research and development expenses decreased to approximately $116,933 for the three months ended September 30, 2024, from $1,938,672 in 2023, a reduction of approximately 93% [130]. - Research and development expenses for the nine months ended September 30, 2023, totaled approximately $2.8 million, with $1.8 million related to HAT and $1.0 million to ASD [139]. - The estimated remaining aggregate costs for research and development and regulatory filing activities related to the NDA for Human African Trypanosomiasis (HAT) are approximately $2.6 million [133]. - Estimated remaining costs for the NDA filing for HAT are approximately $2.3 million [140]. - The company is pursuing the development of next-generation ATP product candidates, including KV-102, an intranasal formulation of suramin [116]. Future Outlook and Funding - The company expects to incur significant additional costs associated with the development and commercialization of KV-101 and other product candidates [122]. - The company anticipates incurring additional losses and may never become profitable, indicating a need for substantial additional funding [158]. - As of September 30, 2024, the company had a cash balance of approximately $0.4 million, raising substantial doubt about its ability to continue as a going concern [157]. - The company has commitments to pay $2.3 million for accounts payable and accrued expenses over the next twelve months [160]. Regulatory and Market Activities - A type-B meeting with the FDA was completed on October 26, 2023, discussing the PAX-HAT-301 study results, with NDA filing expected in the second half of 2026 [118]. - An exclusive distribution agreement with Vox Nova for KV-101 includes an upfront exclusivity fee of $0.5 million and potential additional payments of up to $2.0 million upon FDA approval [147]. - The company entered into a secondary public offering on November 20, 2023, selling 5,384,615 shares at $1.30 per share, resulting in net proceeds of approximately $6.1 million [148]. Shareholder Information - The company issued approximately 3.1 million shares of common stock due to warrant exercises during the nine months ended September 30, 2024 [150]. - The company is classified as a smaller reporting company under Rule 12b-2 of the Exchange Act and is not obligated to provide the detailed disclosures typically required for market risk [168].

Share Structure and Ownership - The company has a dual class share structure with 123,715,022,675 ordinary shares outstanding, including 111,851,094,785 Class A shares and 11,863,927,890 Class B shares, where Class B shares have ten votes per share compared to one vote for Class A shares[33]. - Golden Stream Ltd. owns all Class B shares, representing 9.59% of total outstanding share capital and 51.47% of the voting power, significantly influencing corporate decisions[34]. Operational Structure and Regulatory Compliance - The company operates primarily through its PRC subsidiaries and Current VIEs, consolidating their financial results under U.S. GAAP due to contractual arrangements[36]. - The Current VIEs have obtained all necessary business licenses and insurance agency operating licenses from PRC authorities, with no applications denied[41]. - The company is not required to undergo cybersecurity review as it does not control personal information of over one million users and is already listed on the Nasdaq Capital Market[42]. - The Overseas Listing Regulations require the company to fulfill filing procedures within three working days for any overseas securities offerings, which could impact its ability to offer securities[43]. - The company has not received any denials for requisite permissions from PRC authorities in connection with its operations or acquisitions[44]. - The VIE structure poses unique risks, including potential changes in PRC laws that could affect the enforceability of contractual arrangements[38]. - The company faces uncertainties regarding the enforcement of its contractual arrangements with Current VIEs, which may affect operational control and financial performance[39]. Financial Performance and Cash Management - Total operating revenues for the year ended September 30, 2025, amounted to RMB 365,267,000, with a gross profit of RMB 8,001,000[58]. - The company reported a net loss from continuing operations of RMB 748,414,000 for the year ended September 30, 2025[58]. - Cash and cash equivalents at the end of the year were RMB 15,879,000, an increase from RMB 13,085,000 at the beginning of the year[58]. - The total current liabilities reached RMB 949,168,000, with significant components including accounts payable of RMB 29,480,000 and accrued expenses of RMB 51,144,000[58]. - The accumulated deficit stood at RMB 4,605,215,000, indicating ongoing financial challenges[58]. - Operating expenses for the year totaled RMB 728,344,000, reflecting the company's investment in growth despite losses[58]. - The company experienced a net cash outflow from operating activities of RMB 11,698,000 for the year[58]. - The company has not received any notifications from authorities regarding compliance with cybersecurity regulations, indicating no material impact on operations as of the report date[123]. Dividend and Cash Transfer Policies - The company relies on dividends from its subsidiaries for cash requirements, which may be restricted by applicable laws and regulations[35]. - As of the date of the annual report, no dividends or distributions have been made between the holding company, XChange TEC.INC, its subsidiaries, and the consolidated VIEs, including to U.S. investors[51]. - Current PRC regulations permit Alpha Mind WFOE to pay dividends only out of its accumulated profits, which must be determined in accordance with Chinese accounting standards[51]. - The PRC government may impose restrictions on the ability to transfer cash and assets outside of the PRC, affecting operational funding[52]. - The withholding tax rate on dividends payable by Chinese companies to non-PRC-resident enterprises is generally 10%, but may be reduced to 5% under certain conditions for Hong Kong resident enterprises[51]. - The cash transfer among XChange TEC.INC, its subsidiaries, and the consolidated VIEs is typically conducted through payments for intercompany services or borrowings[52]. - There are no restrictions on foreign exchange for the Hong Kong subsidiary, allowing for cash transfers to U.S. investors[50]. Market and Competitive Risks - The company faces intense competition in the insurance agency market, with competitors having greater financial and marketing resources[94]. - The company is subject to customer concentration risk, with significant revenue derived from a limited number of clients and geographical regions[97]. - The company may not be able to maintain or improve profitability due to ongoing operational expansion and associated costs[81]. - The company launched its SaaS platform in 2023 to expand its insurance agency business from offline to online, with expectations of future revenue generation[104]. - The company has not yet generated revenue from the SaaS platform, and its success depends on market acceptance and regulatory requirements in China's insurance industry[104]. - The COVID-19 pandemic adversely affected the vehicle sales volume in the PRC automobile industry, impacting the company's automobile insurance business[109]. Cybersecurity and Data Privacy Risks - The company faces risks related to cybersecurity and data privacy, with increasing regulatory scrutiny in China that could impact its financial condition[120]. - The company may experience significant disruptions in services due to IT system failures, which could adversely affect its operations and profitability[112]. - The company is at risk of disintermediation as end customers may increasingly purchase insurance directly from insurance companies, impacting its business model[103]. - The company must continuously invest in IT and SaaS systems to keep up with technological developments, which may not always lead to increased profitability[113]. - The company faces potential reputational harm and regulatory sanctions due to misconduct by its in-house sales force and external referral sources[115]. Regulatory and Compliance Risks - The company has identified material weaknesses in internal control over financial reporting, specifically a lack of personnel knowledgeable in U.S. GAAP and SEC reporting requirements[130]. - As of September 30, 2025, the company concluded that its internal control over financial reporting was not effective, which could lead to errors in financial statements and loss of investor confidence[130]. - The company is subject to extensive regulation by the CBIRC, which has the authority to impose sanctions that could adversely affect business operations and profitability[134]. - Changes in regulations regarding insurance products and commission rates could materially impact the revenue and profitability of the company's insurance agency business[135]. - The company may face risks related to intellectual property infringement claims, which could divert resources and adversely affect business operations[125]. - The company must maintain various licenses and permits to conduct business, and failure to do so could materially impact operations[136]. - The company faces uncertainties regarding its VIE structure, which could be subject to regulatory changes that may affect its operations and financial performance[138]. - The company operates in China through contractual arrangements with Current VIEs, which are classified as foreign-invested enterprises under PRC laws[139]. - The PRC legal counsel believes that the contractual arrangements are valid and enforceable, but substantial uncertainties remain regarding PRC laws[140][141]. Economic and Political Risks - The company faces risks from changes in China's economic, political, or social conditions, which could adversely impact business and financial results[159][161]. - The PRC government exercises significant control over economic growth, which could adversely affect the company's business operations and financial condition[167]. - The PRC legal system presents uncertainties that could limit the reliability of legal protections available to the company and its subsidiaries[169]. Taxation and Currency Risks - The company may be treated as a PRC resident enterprise for tax purposes, potentially subjecting it to a 25% enterprise income tax on global income[183]. - Dividends payable to foreign investors may be subject to a 10% PRC withholding tax, affecting the value of investments in Class A Ordinary Shares[186]. - Indirect transfers of equity interests in PRC resident enterprises by non-PRC holding companies may be subject to PRC enterprise income tax at a rate of 10%[190]. - The PRC subsidiaries primarily rely on dividend payments in Renminbi to fund cash and financing requirements, which may be limited by governmental currency conversion controls[194]. - Significant revenue from PRC subsidiaries is denominated in Renminbi, and any restrictions on currency exchange may limit their ability to utilize cash for business activities outside of China[197]. - Fluctuations in the value of the Renminbi against the U.S. dollar may materially adversely affect investments, with potential appreciation or depreciation impacting conversion amounts[198][199]. - Limited hedging options are available in China to mitigate exposure to exchange rate fluctuations, and the company has not entered into material hedging transactions as of the report date[200]. Labor and Employment Risks - The enforcement of the PRC Labor Contract Law may adversely affect business operations, with specific provisions regarding employment contracts and severance payments[201][202]. - The company has accrued but not made full contributions to social insurance plans and housing provident funds, which may result in penalties or liabilities[204][205]. Market Performance and Compliance - The market price for the company's ADSs is volatile, influenced by factors such as regulatory developments, market conditions, and performance of other companies in the industry[218][219]. - The company received a notice from NASDAQ on November 8, 2024, indicating non-compliance with the minimum bid price requirement of US$1 per share, but regained compliance by November 26, 2024[221]. - On November 13, 2024, the company was notified of non-compliance with the minimum Market Value of Listed Securities (MVLS) of $35 million, which was regained by June 11, 2025[222][223]. - The company cannot assure compliance with all NASDAQ Listing Rules at all times, which could lead to delisting risks[224]. - Substantial future sales of ADSs in the public market could cause a decline in the market price of the ADSs[229]. - The company intends to retain most available funds and future earnings to fund business development and growth[227].

Share Structure and Ownership - The company has a dual class share structure with 123,715,022,675 ordinary shares outstanding, including 111,851,094,785 Class A shares and 11,863,927,890 Class B shares, where Class B shares have ten votes per share compared to one vote for Class A shares [33]. - Golden Stream Ltd. owns all Class B shares, representing 9.59% of total outstanding share capital and 51.47% of voting power, significantly influencing corporate decisions [34]. VIE Structure and Regulatory Compliance - The company operates through a VIE structure, consolidating financial results of Current VIEs under U.S. GAAP, despite not owning equity interests in them [36]. - All Current VIEs have obtained valid business licenses from local SAMR, and no applications for such licenses have been denied [41]. - The company is not required to undergo cybersecurity review as it does not control personal information of over one million users and is already listed on the Nasdaq Capital Market [42]. - The Overseas Listing Regulations require the company to fulfill filing procedures within three working days for any overseas securities offerings, which could impact its ability to offer securities [43]. - The company has received all requisite permits and approvals from PRC authorities to conduct business operations in China, with no permissions denied or revoked [41]. - The VIE structure poses unique risks, including potential challenges in enforcing contractual arrangements due to jurisdictional and legal limitations [38]. - The company may face uncertainties regarding future PRC laws that could affect the enforceability of its contractual arrangements with Current VIEs [39]. - The company is advised that the Acquisition does not require filing with the CSRC or cybersecurity review, as it does not involve issuance or listing of shares [44]. Financial Performance - Total operating revenues for the year ended September 30, 2025, amounted to RMB 365,267,000, with a gross profit of RMB 8,001,000 [58]. - The company reported a net loss from continuing operations of RMB 748,414,000 for the year ended September 30, 2025 [58]. - Cash and cash equivalents at the end of the year were RMB 15,879,000, an increase from RMB 13,085,000 at the beginning of the year [58]. - The company has a significant accumulated deficit of RMB 4,605,215,000 as of September 30, 2025 [58]. - The company recorded a net loss of RMB 748.4 million (US$ 105.1 million) in FY 2025, with an accumulated deficit of RMB 4,605.2 million (US$ 646.9 million) as of September 30, 2025 [77]. - The company incurred operating expenses of RMB 728,344,000 for the year, leading to a loss from operations of RMB 720,343,000 [58]. - The effect of exchange rate changes resulted in a net decrease of RMB 3,807,000 in cash and cash equivalents [58]. Cash Management and Dividends - As of the date of the annual report, no dividends or distributions have been made between the holding company, XChange TEC.INC, its subsidiaries, and the consolidated VIEs, including to U.S. investors [51]. - Current PRC regulations permit Alpha Mind WFOE to pay dividends only out of its accumulated profits, which must be determined in accordance with Chinese accounting standards [51]. - The withholding tax rate on dividends payable by Chinese companies to non-PRC-resident enterprises is generally 10%, but may be reduced to 5% under certain conditions for Hong Kong resident enterprises [51]. - The statutory reserve requirement mandates that at least 10% of after-tax profits be set aside each year until it reaches 50% of registered capital [51]. - There are no restrictions on foreign exchange for the Hong Kong subsidiary, allowing for cash transfers to U.S. investors [50]. - As of the date of the report, there are no cash management policies in place for fund transfers within the organization [47]. Risks and Challenges - The company faces intense competition in the insurance agency market, which is highly fragmented, potentially impacting its market position [94]. - The company is subject to risks related to localized economic downturns and regulatory changes that could affect business in key provinces contributing over 50% of commission revenue [99]. - The company may not be able to maintain or renew contracts with insurance companies, which could adversely affect its revenue and operational results [86]. - The company faces risks related to cybersecurity and data privacy, with increasing regulatory scrutiny in China that could affect its financial condition [119]. - The company is subject to credit risks from customers, particularly insurance companies, which may impact its financial position and results of operations [117]. - The company faces potential legal and reputational risks due to misconduct by its in-house sales force and external referral sources, which could harm its business [115]. - The company faces risks from changes in China's economic, political, or social conditions that could materially affect operations and financial condition [159][161]. Future Outlook and Strategic Initiatives - The company launched its SaaS platform in 2023 to expand its insurance agency business from offline to online, with expectations of future revenue generation [104]. - The company has not yet generated revenue from the SaaS platform, and its success depends on market acceptance and regulatory requirements in China's insurance industry [104]. - The company intends to pay the remaining Notes using cash flow from operations or through debt or equity offerings, but may face challenges in obtaining favorable financing [79]. Regulatory Environment - The PRC legal counsel believes that the contractual arrangements are valid and enforceable, but substantial uncertainties remain regarding PRC laws [140][141]. - If regulators deem the corporate structure illegal, the company may need to modify its structure, potentially disrupting business operations [142]. - The company may need to obtain additional permits and approvals for operations, which could materially affect its business if not obtained [170]. - Non-compliance with Circular 37 could lead to fines and legal penalties for the company's PRC subsidiaries, affecting their ability to distribute profits [178]. - The PRC government may impose restrictions on the ability to transfer cash and assets outside of the PRC, affecting operational funding [52]. Market and Trading Conditions - The market price for the ADSs is volatile, influenced by factors such as regulatory developments, market conditions, and performance of other companies in the industry [218]. - The trading volume of the ADSs may be highly volatile due to various factors, including changes in financial estimates by analysts and negative publicity [219]. - The company received a notice from NASDAQ on November 8, 2024, indicating non-compliance with the minimum bid price requirement of US$1 per share, but regained compliance by November 26, 2024 [221]. - The company has adopted share incentive plans in 2019, 2022, 2024, and 2025, which may lead to dilution of ownership for existing ADS investors [230]. - The company cannot assure compliance with all NASDAQ Listing Rules at all times, which could lead to delisting [224].

Financial 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].

Financial 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]. - Operating income improved to $65.4 million from a loss of $82.2 million, marking a significant turnaround[365]. - Net income attributable to common shareholders was $89.1 million, compared to a loss of $286.4 million in the prior year, reflecting a 131.1% improvement[365]. - 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 for the nine months ended September 30, 2025, was $220.0 million, a substantial increase from a net loss of $769.3 million in 2024[402]. Revenue Breakdown - The Capital Markets segment saw a revenue increase of $34.9 million to $65.4 million, primarily driven by a $32.6 million rise in corporate finance, consulting, and investment banking fees[370]. - The Wealth Management segment's revenues from services and fees decreased by $15.0 million to $34.3 million, attributed to a reduction in assets under management (AUM) from approximately $25.7 billion to $13.3 billion[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 Consumer Products segment reported a decrease in sales of goods by $2.8 million, contributing to overall revenue declines in certain areas[369]. - The Capital Markets segment saw a revenue decrease of $11.4 million to $129.7 million, primarily due to declines in corporate finance and investment banking fees[407]. 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 rise 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 76.5%[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 Strategy - The Company operates in five reportable segments: Capital Markets, Wealth Management, Communications, Consumer Products, and E-Commerce, focusing on diversified financial services and investments[344]. - 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 to expand its Communications Segment, which includes several cloud and telecommunications businesses[349]. 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, reflecting 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, up 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 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]. - The company reported a net decrease in cash, cash equivalents, and restricted cash of $71.2 million for the nine months ended September 30, 2025[451]. Expenses and Impairments - Total selling, general and administrative expenses decreased by $17.2 million to $143.9 million during the three months ended September 30, 2025, from $161.1 million in the same period in 2024[383]. - 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 in 2024[384]. - The company recognized an impairment charge of $1.5 million for the Targus tradename due to potential impairment indicators[362]. - Selling, general and administrative expenses decreased by $64.4 million to $453.6 million, with notable reductions in the Wealth Management and Corporate segments[422]. - Wealth Management segment's selling, general and administrative expenses decreased by $27.9 million to $120.7 million for the nine months ended September 30, 2025, from $148.6 million in 2024, primarily due to a $26.1 million decrease in employee compensation and benefits[424].

Financial 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]. - Operating income improved to $65.4 million from a loss of $82.2 million in the prior year, marking a significant turnaround[365]. - Net income attributable to common shareholders was $89.1 million, compared to a loss of $286.4 million in the same quarter last year, reflecting a 131.1% improvement[365]. - 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 for the nine months ended September 30, 2025, was $220.0 million, compared to a net loss of $769.3 million in 2024[402]. Revenue Breakdown - The Capital Markets segment saw a revenue increase of $34.9 million to $65.4 million, primarily driven by a rise in corporate finance, consulting, and investment banking fees[370]. - The Wealth Management segment's revenues from services and fees decreased by $15.0 million to $34.3 million, attributed to a reduction in assets under management (AUM) from approximately $25.7 billion to $13.3 billion[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 Consumer Products segment reported a decrease in sales of goods by $2.8 million, contributing to the overall revenue decline in certain areas[369]. - The Capital Markets segment saw a revenue decrease of $11.4 million to $129.7 million, primarily due to declines in corporate finance and investment banking fees[407]. Investment and Assets - 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 Babcock & Wilcox Enterprises, Inc. common stock increased to $79.6 million as of September 30, 2025, from $45.0 million as of December 31, 2024, reflecting a rise of 76.4%[356]. - The carrying value of private equity securities was $99.0 million as of September 30, 2025, down from $107.6 million as of December 31, 2024, representing a decrease of 8.0%[359]. 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, reflecting 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, up 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 from $354.7 million in 2024, mainly due to the suspension of dividends and a net increase in debt-related proceeds[453]. - The company expects current cash, cash equivalents, and available credit facilities to meet working capital and capital expenditure requirements for at least the next 12 months[445]. Expenses and Impairments - Total selling, general and administrative expenses decreased by $17.2 million to $143.9 million during the three months ended September 30, 2025, from $161.1 million in the same period of 2024[383]. - 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]. - The company recognized an impairment charge of $1.5 million for the Targus tradename due to potential impairment indicators[362]. - Selling, general and administrative expenses decreased by $64.4 million to $453.6 million, with notable reductions in the Wealth Management and Communications segments[422]. Debt and Dividends - As of September 30, 2025, total borrowings outstanding were $1.4 billion, including $1.3 billion from senior notes due between March 31, 2026, and August 31, 2028, with interest rates ranging from 5.00% to 8.00%[444]. - The company did not pay any cash dividends on common stock during the three months ended September 30, 2025, and suspended dividends in August 2024 to prioritize debt reduction[447]. - Dividends in arrears for Series A Preferred Stock amounted to $4.5 million as of September 30, 2025, and for Series B Preferred Stock, $2.9 million[448][449]. Future Outlook and Strategy - The Company aims to maximize free cash flow through operational improvements in acquired companies, targeting attractive risk-adjusted returns[342]. - The Company plans to pursue future acquisitions to expand its Communications Segment, which includes several cloud and telecom service providers[349]. - The company continues to monitor financial performance to ensure sufficient liquidity for operations and business plans[446]. - The Company underwent a name change to BRC Group Holdings, Inc. effective January 1, 2026, while retaining its trading symbol "RILY"[360].

Regulatory Environment - The company operates primarily in Hong Kong through two subsidiaries, with significant regulatory oversight from the PRC government potentially impacting operations and share value [33]. - The PRC government may impose future restrictions on currency transfer and earnings distribution, which could hinder business expansion outside of Hong Kong [40]. - Compliance with evolving PRC laws regarding data privacy and cybersecurity may incur significant costs and affect the company's financial condition [47]. - The company faces uncertainties regarding the interpretation and enforcement of PRC laws, which could affect business operations and legal compliance [37]. - Regulatory actions in Mainland China may lead to increased operational costs and management attention, potentially affecting overall business performance [39]. - Future changes in PRC laws could require the company to alter its business practices, potentially decreasing demand for its services and impacting revenues [40]. - The evolving nature of PRC laws and regulations may materially and adversely affect the company's financial condition and results of operations [62]. - Any future requirements imposed by the PRC government could significantly limit the company's ability to offer securities to investors [64]. - There is uncertainty regarding future PRC government approvals for offering securities to foreign investors [55]. - The company is not required to obtain regulatory approval from PRC authorities for its operations in Hong Kong, but future changes in regulations could impose new compliance requirements [45]. Financial Performance - As of August 31, 2025, the company reported net current liabilities of US$837,491, raising substantial doubt about its ability to continue as a going concern [75]. - The company generated a negative cash flow from operating activities of US$1,267,366 for the year ended August 31, 2025, indicating significant operational challenges [76]. - The company does not expect to pay cash dividends in the foreseeable future, relying on subsidiary distributions for funding [146]. - Future cash flow may be restricted by potential limitations imposed by the PRC government on transferring funds from subsidiaries, impacting the company's ability to operate and grow [145][149]. - The company intends to retain all remaining funds and future earnings for business operation and expansion, with no anticipated dividends in the foreseeable future [199]. Operational Challenges - The company plans to focus on improving operational efficiency and cost reductions while seeking additional capital through private placement or public offering [76]. - The company faces risks related to maintaining sales and profitability of existing restaurants, which are critical for revenue growth [81]. - The company may encounter delays or failures in opening new restaurants, which could adversely affect its growth strategy and financial results [84]. - The company is subject to licensing requirements from the FEHD, which may delay restaurant openings and expansion plans [85]. - The company may face challenges in hiring and retaining qualified employees in new markets, which could impact operational efficiency [86]. - Employee turnover and recruitment challenges have led to increased labor costs, impacting operational efficiency and service quality [121]. - The company is exposed to potential compliance costs and operational disruptions due to stringent licensing requirements in Hong Kong [114]. Market and Competition - The company operates all its restaurants under two brands, "Thai Pot" and "Gyu! Gyu! Shabu Shabu," and its future success heavily relies on brand recognition and customer loyalty [80]. - The company faces intense competition in the hotpot restaurant market, which may adversely affect its business and results of operations [119]. - The profitability of restaurants is heavily dependent on location, and the company may struggle to find commercially viable locations in Hong Kong [94]. - The company plans to open new restaurants in markets with little or no operating experience, which may lead to lower profitability compared to existing markets [86]. - The global economic downturn and geopolitical tensions, such as the situation in Ukraine, could adversely impact the company's operations and financial condition [128]. Corporate Governance and Share Structure - The dual-class share structure concentrates voting power with the controlling shareholder, Happy City Group Limited, which holds 97.08% of the voting power [150][152]. - The concentration of ownership by Happy City Group Limited may delay or prevent changes in control, affecting shareholder opportunities for premium sales [155]. - The dual-class share structure may lead to exclusion from major indices like the Russell 2000 and S&P 500, potentially impacting the attractiveness and market price of Class A Ordinary Shares [156]. - As a controlled company under Nasdaq rules, the company may exempt itself from certain corporate governance requirements, which could adversely affect public shareholders [157]. - The company is classified as a foreign private issuer, exempt from certain U.S. securities regulations, which may affect the level of information available to shareholders [205]. - The company is an "emerging growth company," allowing it to take advantage of reduced disclosure requirements, which may make its shares less attractive to investors [214]. Audit and Compliance Risks - The independent auditor, AOGB CPA LIMITED, is subject to PCAOB inspections, but recent developments may hinder full cooperation with PCAOB requests [173]. - If the PCAOB cannot inspect the auditor for two consecutive years, the company's Class A Ordinary Shares may face delisting risks under the HFCAA [172]. - The PCAOB reported it is unable to inspect or investigate public accounting firms in Mainland China and Hong Kong due to local authorities' positions, impacting companies using these firms [179]. - The trading price of Class A Ordinary Shares has been volatile, influenced by market factors and the performance of other Chinese companies listed in the U.S. [182]. - The company may face significant consequences if it fails to meet Nasdaq's continued listing standards, including potential delisting and reduced liquidity [192]. Risks Related to Supply Chain and Operations - The company relies on a limited number of suppliers, and any significant interruption in their operations could negatively impact the availability and quality of supplies [106]. - Fluctuations in ingredient costs and supply chain inputs may lead to declines in margins and operating results, impacting overall profitability [91]. - Food safety is a top priority, but risks of food contamination could adversely affect the quality of food served, leading to potential liability claims and negative publicity [87]. - The successful integration of two distinct hotpot brands into a single location involves logistical and operational complexities that could affect profitability [97]. Shareholder Rights and Legal Risks - There is uncertainty regarding the enforceability of U.S. court judgments in the BVI and Hong Kong, which may complicate legal recourse for shareholders [161][162]. - Minority shareholders in the BVI have limited protections compared to U.S. shareholders, affecting their recourse options [166]. - The company may choose to follow home country governance practices, potentially providing less protection for shareholders than U.S. regulations [169].

Financial Performance - For Q3 2025, net sales reached $472.6 million, a 3% increase from $456.6 million in Q3 2024, while year-to-date net sales totaled $1.41 billion, up 8.6% from $1.29 billion in the same period last year [15]. - Gross profit for Q3 2025 was $207.7 million, compared to $196.6 million in Q3 2024, reflecting a gross margin improvement [15]. - Operating loss for Q3 2025 was $11.1 million, a decline from an operating income of $8.3 million in Q3 2024 [15]. - The company reported a net loss of $87.2 million for Q3 2025, compared to a net loss of $65.5 million in Q3 2024 [15]. - Adjusted EBITDA for the three months ended September 30, 2025, was $30,299,000, a decrease of 37.5% from $48,595,000 in the same period of 2024 [16]. - The total net loss from continuing operations for the nine months ended September 30, 2025, was $217,251,000, a decrease from $257,350,000 in the same period of 2024, showing a 15.6% improvement [19][20]. - The company reported an EBITDA of $54.794 million for the nine months ended September 30, 2025, compared to a negative EBITDA of $40.123 million in 2024, showing a turnaround in operational performance [19][20]. Assets and Liabilities - Total current assets as of September 30, 2025, were $1.01 billion, an increase from $964.8 million at the end of 2024 [13]. - Total liabilities increased to $2.93 billion as of September 30, 2025, compared to $2.77 billion at the end of 2024 [13]. - Cash and cash equivalents stood at $61.1 million as of September 30, 2025, up from $59.7 million at the end of 2024 [13]. Expenses - Selling, general and administrative expenses rose to $179.3 million in Q3 2025, compared to $146.0 million in Q3 2024, indicating increased operational costs [15]. - Total interest expense for the three months ended September 30, 2025, was $66,721,000, significantly higher than $31,620,000 in the same period of 2024, reflecting a 111% increase [16]. - The company incurred $9,715,000 in distributions paid on preferred shares for the three months ended September 30, 2025, compared to $6,345,000 in 2024, marking a 53% increase [16]. - Corporate expenses for the nine months ended September 30, 2025, were $99.493 million, up from $65.068 million in the same period of 2024, indicating a significant increase in corporate overhead [22]. - Interest expense for the nine months ended September 30, 2025, totaled $136.668 million, compared to $86.483 million in 2024, reflecting increased borrowing costs [19][20]. Impairment and Adjusted Earnings - The impairment expense recorded for the nine months ended September 30, 2025, was $31,515,000, compared to $8,182,000 in the same period of 2024, indicating a significant increase in impairment losses [16]. - The adjusted earnings for the three months ended September 30, 2025, were $(52,725,000), compared to $(12,172,000) in the same period of 2024, reflecting a substantial decline in performance [16]. - The company incurred an impairment expense of $31.515 million in 2025, which was not present in the previous year, impacting overall profitability [19][20]. Segment Performance - The total branded consumer segment reported an Adjusted EBITDA of $128.637 million for the nine months ended September 30, 2025, compared to $113.784 million in 2024, reflecting a 13.1% increase [22]. - The niche industrial segment's Adjusted EBITDA increased to $93.207 million for the nine months ended September 30, 2025, from $88.299 million in 2024, marking a 5.4% growth [22]. - Branded Consumer segment net sales for the nine months ended September 30, 2025, were $839.2 million, up from $732.3 million in 2024, reflecting a year-over-year increase of 14.6% [26]. - The Honey Pot Co. generated pro forma net sales of $34.7 million for the three months ended September 30, 2025, compared to $31.5 million in 2024, indicating a growth of 6.9% [26]. - Niche Industrial segment net sales for the three months ended September 30, 2025, totaled $191.0 million, compared to $183.4 million in 2024, marking a year-over-year increase of 4.3% [26]. - Altor Solutions reported net sales of $79.8 million for the three months ended September 30, 2025, significantly up from $52.1 million in 2024, representing a growth of 52.9% [26]. - Arnold Magnetics experienced a decline in net sales to $37.7 million for the three months ended September 30, 2025, down from $46.1 million in 2024, a decrease of 18.5% [26]. - Sterno's net sales for the three months ended September 30, 2025, were $73.5 million, down from $85.2 million in 2024, reflecting a decrease of 13.5% [26]. Future Outlook - The company is focused on executing strategic priorities to enhance profitability and drive performance across its subsidiaries [2]. - Future outlook remains positive with expectations of continued growth in both branded consumer and niche industrial segments, supported by strategic initiatives and potential acquisitions [26].

Financial Performance - Net revenues for Q3 2025 were $472.6 million, a 3% increase from $456.6 million in Q3 2024[22] - Gross profit for Q3 2025 was $207.7 million, compared to $196.6 million in Q3 2024, reflecting a gross margin improvement[22] - Operating loss for Q3 2025 was $(11.1) million, a decrease from an operating income of $8.3 million in Q3 2024[22] - Net loss for Q3 2025 was $(87.2) million, compared to a net loss of $(65.5) million in Q3 2024, indicating a worsening financial performance[22] - Basic loss per common share attributable to Holdings for Q3 2025 was $(1.21), compared to $(0.62) in Q3 2024[22] - The company reported a comprehensive loss of $(86.2) million for Q3 2025, compared to $(64.1) million in Q3 2024[25] - The company reported a net loss of $74,015,000 for the quarter ending July 1, 2025, indicating a worsening financial position compared to previous periods[29] - The net loss for the quarter ending September 30, 2024, is $36,032,000, compared to a net loss of $28,922,000 in the previous quarter, indicating an increase in losses of about 24%[29] - The company reported a net loss from continuing operations of $(73.492) million for the three months ended September 30, 2025, compared to $(35.536) million for the same period in 2024[155] Assets and Liabilities - Total current assets increased to $1,010.8 million as of September 30, 2025, up from $964.8 million at December 31, 2024[20] - Total liabilities rose to $2,928.8 million as of September 30, 2025, compared to $2,766.8 million at December 31, 2024[20] - Total stockholders' equity attributable to Holdings decreased to $519.2 million as of September 30, 2025, from $678.6 million at December 31, 2024[20] - The company has a total stockholders' equity of $318,366,000 as of September 30, 2025, which is a decrease from $519,217,000, indicating a decline of approximately 38.7%[29] - Cash and cash equivalents increased to $61.1 million as of September 30, 2025, from $59.7 million at December 31, 2024[20] - The company's property, plant, and equipment totaled $491.8 million as of September 30, 2025, down from $498.3 million at the end of 2024[76] - Inventory increased to $602.2 million as of September 30, 2025, compared to $571.2 million at the end of 2024, marking a rise of 5.4%[77] Cash Flow and Investments - Cash used in operating activities for continuing operations was $53,834 thousand for the nine months ended September 30, 2025, compared to $144,343 thousand in 2024, indicating a significant reduction in cash outflow[32] - Total cash used in investing activities for the nine months ended September 30, 2025, was $33,084 thousand, a decrease from $352,251 thousand in 2024, reflecting improved cash management[32] - The company reported a gain on the sale of discontinued operations of $2,326 thousand in 2025, compared to $3,345 thousand in 2024, reflecting ongoing divestiture activities[32] - Cash and cash equivalents at the end of the period were $61,139 thousand in 2025, a decrease from $71,879 thousand in 2024, indicating a tightening liquidity position[34] Financing Activities - Proceeds from the issuance of Trust preferred shares were $58,998 thousand in 2025, compared to $26,944 thousand in 2024, showing a substantial increase in financing through preferred shares[34] - Borrowings from the revolving credit facility amounted to $98,000 thousand in 2025, down from $349,000 thousand in 2024, indicating a reduction in reliance on short-term debt[34] - The company issued $300 million of 5.000% Senior Notes due 2032, with interest payable semi-annually[111] - The company also issued $1,000 million of 5.250% Senior Notes due 2029, with interest payable semi-annually[113] - The total outstanding long-term debt as of September 30, 2025, was $1.88 billion, with significant components including $1.02 billion in 2029 Senior Notes and $305.3 million in 2032 Senior Notes[127] Acquisitions and Divestitures - The Company acquired The Honey Pot Company on January 31, 2024, through a merger and stock purchase agreement, making it a wholly-owned subsidiary[56] - The Company completed the sale of Ergobaby during Q4 2024, with results reported as discontinued operations for the three and nine months ended September 30, 2024[48] - The Company recorded a pre-tax gain of $6.1 million from the sale of Ergobaby, with total proceeds of approximately $99.1 million received at closing[68] - The sale of Crosman Corporation resulted in a loss of $24.6 million, with net proceeds of approximately $61.9 million used to repay intercompany credit[70] Segment Information - As of September 30, 2025, Compass Diversified Holdings controls nine operating segments, including 5.11 Acquisition Corp. and The Honey Pot Co.[37] - The Company operates nine reportable operating segments, each representing a platform acquisition with distinct products and services[217] - 5.11 specializes in technical apparel and gear for law enforcement and military professionals, emphasizing innovation and user collaboration[217] - The Honey Pot Co. offers plant-derived feminine care products and is available in over 33,000 stores across the U.S.[218] Legal and Compliance - The Company is subject to ongoing investigations by the SEC and DOJ due to the withdrawal of reliance on its financial statements for 2024, 2023, and 2022[192] - The Company intends to vigorously defend itself against claims and believes it has strong defenses available[184] - The Company has identified potential defaults under the Credit Agreement due to irregularities at its subsidiary, Lugano, leading to a Forbearance Agreement with lenders[101] Management and Governance - The Company has an at-the-market equity offering program allowing for the issuance of up to $500 million in common shares, refreshed on September 5, 2024[133] - Management fees paid by the LLC to Compass Group Management LLC are limited to $10.5 million per fiscal quarter[103] - The Company suspended quarterly cash distributions to common shareholders on May 27, 2025, to preserve cash amid the Lugano Investigation[141]