UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2025 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-39852 Scilex Holding Company (Exact Name of Registrant as Specified in Its Charter) Delaware 92-1062542 (State or Other Jurisdiction of Incorp ...

[Financial Performance Overview](index=1&type=section&id=FOSSIL%20GROUP%2C%20INC.%20REPORTS%20SECOND%20QUARTER%202025%20FINANCIAL%20RESULTS) Fossil Group reported strong Q2 2025 results with positive operating income and raised full-year guidance, driven by its successful turnaround plan [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) Fossil Group reported positive operating income of $8 million for Q2 2025, a significant turnaround from the loss in the prior year. Despite a 15.2% decline in worldwide net sales to $220 million, gross margin expanded by 490 basis points to 57.5%. The company's strong performance led to an increase in its full-year 2025 guidance Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Change (YoY) | | :--- | :--- | :--- | | Worldwide Net Sales | $220 million | -15.2% | | Gross Margin | 57.5% | +490 bps | | Operating Income | $8 million | N/A (vs. loss in Q2 2024) | | Operating Margin | 3.9% | N/A (vs. negative margin in Q2 2024) | - The company has raised its financial guidance for the **full year 2025**[1](index=1&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) CEO Franco Fogliato attributed the outperformance to the company's turnaround plan, which has delivered a third consecutive quarter of positive adjusted operating income. He highlighted a comprehensive refinancing plan to strengthen the financial position and expressed confidence in the second half of the year, driven by key brand-building initiatives. This momentum supports the decision to raise the full-year 2025 outlook - The company's turnaround plan is showing strength, resulting in a **third consecutive quarter of positive adjusted operating income**[3](index=3&type=chunk) - A comprehensive refinancing plan was announced to strengthen the balance sheet and support growth plans[2](index=2&type=chunk)[3](index=3&type=chunk) - Focus for the second half of the year includes brand-building initiatives, such as a global campaign featuring celebrity brand ambassador Nick Jonas[3](index=3&type=chunk) [Detailed Financial Analysis](index=1&type=section&id=Detailed%20Financial%20Analysis) This section provides an in-depth analysis of Q2 2025 operating results, including sales performance, profitability, and key balance sheet metrics [Second Quarter 2025 Operating Results](index=1&type=section&id=Second%20Quarter%202025%20Operating%20Results) In Q2 2025, net sales fell 15.2% to $220.4 million, impacted by market softness, the exit from the smartwatch category, and store closures. Despite the sales decline, gross margin improved significantly to 57.5% from 52.6% YoY, driven by better product margins and lower freight costs. Operating expenses decreased by 30.8%, leading to an operating income of $8.5 million, a substantial improvement from a $34.0 million loss in Q2 2024. Net loss narrowed to $2.3 million from $38.8 million in the prior-year quarter Q2 2025 Net Sales Performance (Constant Currency) | Category | Change (YoY) | | :--- | :--- | | **By Region** | | | Americas | -19% | | Europe | -14% | | Asia | -12% | | **By Channel** | | | Wholesale | -6% | | Direct to Consumer | -30% | | **By Product** | | | Traditional Watches | -8% | | Leathers | -39% | | Jewelry | -22% | - The exit from the smartwatch category and store rationalization initiatives accounted for approximately **6 percentage points of the total sales decline**[4](index=4&type=chunk) Q2 2025 Profitability vs. Q2 2024 | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Gross Profit | $126.7M | $136.9M | | Gross Margin | 57.5% | 52.6% | | Operating Expenses | $118.2M | $170.9M | | Operating Income (Loss) | $8.5M | $(34.0)M | | Net Loss | $(2.3)M | $(38.8)M | | Diluted Loss Per Share | $(0.04) | $(0.73) | [Balance Sheet Summary](index=3&type=section&id=Balance%20Sheet%20Summary) As of July 5, 2025, Fossil Group maintained total liquidity of $110.6 million, primarily composed of $109.9 million in cash and cash equivalents. The company successfully reduced inventories by 11.9% year-over-year to $178.1 million. Total debt stood at $179.0 million Balance Sheet Highlights (as of July 5, 2025) | Metric | Amount | YoY Change | | :--- | :--- | :--- | | Total Liquidity | $110.6M | N/A | | Cash and Cash Equivalents | $109.9M | +4.8% | | Inventories | $178.1M | -11.9% | | Total Debt | $179.0M | +12.6% | [Outlook and Strategy](index=3&type=section&id=Outlook%20and%20Strategy) Fossil Group has raised its full-year 2025 financial guidance, reflecting improved sales decline forecasts and a positive adjusted operating margin outlook [Full Year 2025 Outlook](index=3&type=section&id=Full%20Year%202025%20Outlook) Reflecting strong year-to-date performance and progress on its turnaround plan, Fossil Group has raised its financial guidance for the full year 2025. The company now anticipates a smaller decline in net sales and has improved its adjusted operating margin forecast Updated Full Year 2025 Guidance | Metric | New Guidance | Prior Guidance | | :--- | :--- | :--- | | Worldwide Net Sales Decline | Mid-teens | Mid to high teens | | Adjusted Operating Margin | Break even to slightly positive | Negative low single digits | - The net sales guidance includes an expected negative impact of approximately **$45 million related to retail store closures**[9](index=9&type=chunk) [Supplemental Financial Data](index=5&type=section&id=Supplemental%20Financial%20Data) This section provides detailed consolidated financial statements, segment performance data, and reconciliations of GAAP to non-GAAP financial measures [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) This section presents the detailed unaudited consolidated income statements and balance sheets for the periods ended July 5, 2025, and June 29, 2024, providing a comprehensive view of the company's financial position and performance [Consolidated Income Statement](index=5&type=section&id=Consolidated%20Income%20Statement) This statement details the company's revenues, expenses, and net loss for the 13-week periods ended July 5, 2025, and June 29, 2024 Income Statement Summary (13 Weeks Ended) | ($ in millions) | July 5, 2025 | June 29, 2024 | | :--- | :--- | :--- | | Net sales | $220.4 | $260.0 | | Gross profit | $126.7 | $136.9 | | Operating income (loss) | $8.5 | $(34.0) | | Net loss attributable to Fossil Group, Inc. | $(2.3) | $(38.8) | | Diluted loss per share | $(0.04) | $(0.73) | [Consolidated Balance Sheet](index=6&type=section&id=Consolidated%20Balance%20Sheet) This statement provides a snapshot of the company's assets, liabilities, and equity as of July 5, 2025, and June 29, 2024 Balance Sheet Summary | ($ in millions) | July 5, 2025 | June 29, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $109.9 | $104.9 | | Inventories | $178.1 | $202.1 | | Total assets | $704.5 | $785.7 | | Total debt (Short & Long-term) | $179.0 | $159.1 | | Stockholders' equity | $133.9 | $187.1 | | Total liabilities and stockholders' equity | $704.5 | $785.7 | [Segment and Product Performance (Constant Currency)](index=6&type=section&id=Segment%20and%20Product%20Performance%20(Constant%20Currency)) On a constant currency basis for Q2 2025, net sales declined across all geographic segments, with the Americas showing the largest decrease. By product, the exit from smartwatches is evident in its sharp decline, while the core traditional watch category saw a single-digit decrease. Leathers and jewelry categories experienced significant double-digit declines Q2 Net Sales by Segment (Constant Currency) | ($ in millions) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Americas | $97.1 | $119.6 | -18.8% | | Europe | $64.2 | $74.8 | -14.2% | | Asia | $57.5 | $65.2 | -11.8% | | **Total** | **$218.9** | **$260.0** | **-15.8%** | Q2 Net Sales by Product (Constant Currency) | ($ in millions) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Traditional watches | $177.9 | $194.1 | -8.3% | | Smartwatches | $1.4 | $8.4 | -83.3% | | Leathers | $16.7 | $27.2 | -38.6% | | Jewelry | $18.8 | $24.2 | -22.3% | [Reconciliation of GAAP to Non-GAAP Measures](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) The company provides reconciliations for non-GAAP measures to offer a clearer view of underlying business performance by excluding items like restructuring costs and asset impairments. For Q2 2025, Adjusted Operating Income was $3.8 million, and Adjusted EBITDA was $7.0 million, both marking significant improvements from losses of $17.0 million and $11.7 million, respectively, in the prior-year quarter Adjusted EBITDA Reconciliation Summary | ($ in millions) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Income (loss) before income taxes | $4.1 | $(36.6) | | Adjustments (Interest, D&A, Restructuring, etc.) | +$2.9 | +$24.9 | | **Adjusted EBITDA** | **$7.0** | **$(11.7)** | Adjusted Operating Income Reconciliation Summary | ($ in millions) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Operating income (loss) (GAAP) | $8.5 | $(34.0) | | Restructuring Expenses | $7.3 | $16.7 | | Gains on Asset Divestitures | $(11.5) | - | | Other Long-Lived Asset Impairment | - | $0.6 | | **As Adjusted Operating Income (Loss)** | **$4.3** | **$(16.7)** | [Store Count Information](index=12&type=section&id=Store%20Count%20Information) As part of its store rationalization strategy, Fossil Group continued to reduce its physical retail footprint. The company closed 47 stores and opened 3, resulting in a net reduction of 44 stores. The total store count decreased from 258 at the end of Q2 2024 to 214 at the end of Q2 2025 Store Count by Region | Region | June 29, 2024 | Opened | Closed | July 5, 2025 | | :--- | :--- | :--- | :--- | :--- | | Americas | 120 | 0 | 19 | 101 | | Europe | 69 | 0 | 17 | 52 | | Asia | 69 | 3 | 11 | 61 | | **Total stores** | **258** | **3** | **47** | **214** |

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-41593 Oxley Bridge Acquisition Limited (Exact name of registrant as specified in its charter) | Cayman Islands | 98- 181002 | | ...

[Kezar Life Sciences Reports Second Quarter 2025 Financial Results and Provides Business Update](index=1&type=section&id=Kezar%20Life%20Sciences%20Reports%20Second%20Quarter%202025%20Financial%20Results%20and%20Provides%20Business%20Update) Kezar Life Sciences announced its Q2 2025 financial results and provided updates on clinical development and regulatory progress for zetomipzomib [Company Announcement & CEO Statement](index=1&type=section&id=Company%20Announcement%20%26%20CEO%20Statement) Kezar Life Sciences reported Q2 2025 financial results and business updates, with CEO Chris Kirk highlighting zetomipzomib's clinical development and regulatory submission progress for autoimmune hepatitis - Kezar Life Sciences, a clinical-stage biotechnology company, reported financial results for the second quarter ended June 30, 2025, and provided a business update on August 13, 2025[1](index=1&type=chunk)[2](index=2&type=chunk) - CEO Chris Kirk stated the company is on track with clinical development and regulatory submission for zetomipzomib in autoimmune hepatitis, proposing a registration-enabling study and anticipating a Type C meeting with the FDA[3](index=3&type=chunk) [Business Update](index=1&type=section&id=Business%20Update) This section details the clinical and regulatory advancements for zetomipzomib, corporate personnel changes, and upcoming medical conference presentations [Zetomipzomib Clinical & Regulatory Progress](index=1&type=section&id=Zetomipzomib%20Clinical%20%26%20Regulatory%20Progress) Kezar achieved significant milestones for zetomipzomib, including FDA's removal of a partial clinical hold on the PORTOLA Phase 2a trial for autoimmune hepatitis (AIH) and the submission of a Type C meeting request to discuss the AIH development plan - FDA removed partial clinical hold on PORTOLA Phase 2a trial evaluating zetomipzomib for autoimmune hepatitis (AIH) in July[5](index=5&type=chunk)[6](index=6&type=chunk) - Submitted Type C meeting request to the FDA to meet during Q4 2025 to discuss the AIH development plan for zetomipzomib[5](index=5&type=chunk)[6](index=6&type=chunk) - Submitted a complete response to the FDA Division of Rheumatology and Transplant Medicine with a request to remove the clinical hold on zetomipzomib in lupus nephritis[7](index=7&type=chunk) - PORTOLA Phase 2a trial results in relapsed or refractory AIH patients showed **36% (5 of 14) achieved a complete biochemical response (CR)** and clinically significant steroid taper to 5 mg/day or less by 6 months, compared to 0 of 7 placebo patients[6](index=6&type=chunk) - The median duration of response in zetomipzomib patients achieving CR was **27.6 weeks**, with no disease flares reported during the study[6](index=6&type=chunk) - A favorable safety profile was observed during the 6-month blinded treatment period[6](index=6&type=chunk) [Corporate & Personnel Updates](index=2&type=section&id=Corporate%20%26%20Personnel%20Updates) Zung To was promoted to Chief Development Officer in June 2025, bringing 35 years of industry experience and leading Kezar's development strategy - Zung To was promoted to Chief Development Officer in June 2025, bringing **35 years of industry experience**, including over 20 years in senior leadership roles in clinical development[8](index=8&type=chunk) [Medical Conference Presentations](index=2&type=section&id=Medical%20Conference%20Presentations) PORTOLA Phase 2a data and biomarker data have been selected for oral and poster presentations, respectively, at The Liver Meeting® 2025 in November - An abstract featuring PORTOLA Phase 2a data has been selected for an oral presentation at The Liver Meeting® 2025 (November 7-11, Washington, DC)[5](index=5&type=chunk)[10](index=10&type=chunk) - An abstract featuring PORTOLA biomarker data has been selected for poster presentation at The Liver Meeting® 2025[10](index=10&type=chunk) [Financial Results](index=2&type=section&id=Financial%20Results) This section presents Kezar's second quarter 2025 financial performance, including key income statement and balance sheet data [Summary of Q2 2025 Financial Performance](index=2&type=section&id=Summary%20of%20Q2%202025%20Financial%20Performance) Kezar reported a net loss of $13.7 million for Q2 2025, an improvement from $21.5 million in Q2 2024, driven by decreased R&D, G&A, and restructuring expenses Key Financial Highlights (Q2 2025 vs Q2 2024) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change (Millions) | | :-------------------------------- | :----------------- | :----------------- | :---------------- | | Cash, Cash Equivalents & Marketable Securities (as of period end) | $100.8 | $132.2 (Dec 31, 2024) | $(31.4) | | Research & Development (R&D) Expenses | $9.6 | $16.3 | $(6.7) | | General & Administrative (G&A) Expenses | $5.0 | $5.6 | $(0.6) | | Restructuring & Impairment Charges | $0.0 | $1.5 | $(1.5) | | Net Loss | $(13.7) | $(21.5) | $7.8 | | Net Loss per Share (Basic & Diluted) | $(1.87) | $(2.96) | $1.09 | - The decrease in R&D expenses was primarily due to reduced clinical activities from trial completion and closeout, lower personnel costs (including non-cash stock-based compensation), and decreased facility-related expenses[11](index=11&type=chunk) - The decrease in G&A expenses was mainly attributable to lower non-cash stock-based compensation and personnel-related expenses[11](index=11&type=chunk) - Restructuring and impairment charges decreased due to an impairment charge in 2024 related to a vacated floor in the company's leased office facility[11](index=11&type=chunk) [Selected Balance Sheets Data](index=3&type=section&id=Selected%20Balance%20Sheets%20Data) As of June 30, 2025, Kezar's cash, cash equivalents, and marketable securities totaled $100.8 million, a decrease from December 31, 2024, with all major balance sheet items also decreasing Selected Balance Sheets Data (as of June 30, 2025 vs. December 31, 2024) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :----------------------------------- | :------------ | :---------------- | :----- | | Cash, cash equivalents and marketable securities | $100,849 | $132,245 | $(31,396) | | Total assets | $109,123 | $144,682 | $(35,559) | | Total current liabilities | $14,365 | $20,329 | $(5,964) | | Total noncurrent liabilities | $2,972 | $7,437 | $(4,465) | | Total stockholders' equity | $91,786 | $116,916 | $(25,130) | [Summary of Operations Data](index=3&type=section&id=Summary%20of%20Operations%20Data) For Q2 2025, total operating expenses decreased significantly to $14.6 million, resulting in a reduced net loss of $13.7 million, with similar trends observed for the six-month period Summary of Operations Data (Three Months Ended June 30) | Metric (in thousands) | Q2 2025 | Q2 2024 | Change | | :------------------------------------------ | :------ | :------ | :----- | | Research and development | $9,583 | $16,298 | $(6,715) | | General and administrative | $5,016 | $5,603 | $(587) | | Restructuring and impairment charges | $0 | $1,482 | $(1,482) | | Total operating expenses | $14,599 | $23,383 | $(8,784) | | Loss from operations | $(14,599) | $(23,383) | $8,784 | | Interest income | $1,197 | $2,237 | $(1,040) | | Interest expense | $(302) | $(401) | $99 | | Net loss | $(13,704) | $(21,547) | $7,843 | | Net loss per common share, basic and diluted | $(1.87) | $(2.96) | $1.09 | | Weighted-average shares used to compute net loss per common share, basic and diluted | 7,311,032 | 7,284,587 | 26,445 | Summary of Operations Data (Six Months Ended June 30) | Metric (in thousands) | H1 2025 | H1 2024 | Change | | :------------------------------------------ | :------ | :------ | :----- | | Research and development | $21,763 | $33,470 | $(11,707) | | General and administrative | $10,465 | $12,142 | $(1,677) | | Restructuring and impairment charges | $0 | $1,482 | $(1,482) | | Total operating expenses | $32,228 | $47,094 | $(14,866) | | Loss from operations | $(32,228) | $(47,094) | $14,866 | | Interest income | $2,617 | $4,690 | $(2,073) | | Interest expense | $(649) | $(801) | $152 | | Net loss | $(30,260) | $(43,205) | $12,945 | | Net loss per common share, basic and diluted | $(4.14) | $(5.93) | $1.79 | | Weighted-average shares used to compute net loss per common share, basic and diluted | 7,308,360 | 7,282,289 | 26,071 | [About Kezar Life Sciences](index=3&type=section&id=About%20Kezar%20Life%20Sciences) This section provides an overview of Kezar Life Sciences as a clinical-stage biopharmaceutical company and its lead product candidate, zetomipzomib [Company Overview](index=3&type=section&id=Company%20Overview) Kezar Life Sciences is a clinical-stage biopharmaceutical company developing novel small molecule therapeutics for immune-mediated diseases, with zetomipzomib as its lead product candidate for autoimmune hepatitis - Kezar Life Sciences is a clinical-stage biopharmaceutical company developing novel small molecule therapeutics to treat unmet needs in immune-mediated diseases[12](index=12&type=chunk) - Zetomipzomib, a selective immunoproteasome inhibitor, is currently being evaluated for autoimmune hepatitis and has the potential to address multiple chronic immune-mediated diseases[12](index=12&type=chunk) [Cautionary Note on Forward-looking Statements](index=3&type=section&id=Cautionary%20Note%20on%20Forward-looking%20Statements) This section provides a disclaimer regarding forward-looking statements, outlining inherent risks and uncertainties that may affect actual results [Forward-looking Statements Disclaimer](index=3&type=section&id=Forward-looking%20Statements%20Disclaimer) This section serves as a disclaimer, indicating that the press release contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially - The press release contains forward-looking statements regarding clinical development programs, regulatory submission plans for zetomipzomib in AIH, and the likelihood of obtaining regulatory approval[13](index=13&type=chunk) - These statements involve risks and uncertainties, such as unexpected safety or efficacy data, difficulties in clinical trials, changes in competition or the regulatory environment, and the timing of the regulatory approval process, which could cause actual results to differ materially[13](index=13&type=chunk) - Kezar assumes no obligation to update any forward-looking statements contained herein to reflect any change in expectations, except as required by law[13](index=13&type=chunk)

[Business and Strategic Update](index=1&type=section&id=Business%20and%20Strategic%20Update) Codexis reported strong Q2 2025 revenue, emphasizing ECO Synthesis® platform momentum and securing $27.3 million for expansion - The CEO highlighted a strategic shift with strong external validation for the ECO Synthesis® platform, noting over **30 ongoing opportunities** and a targeted fundraising to support growth and the development of **GMP-grade siRNA**[2](index=2&type=chunk) - The company strengthened its cash position by raising a total of **$27.3 million** from its at-the-market (ATM) facility and a loan agreement with Innovatus Capital Partners, LLC[1](index=1&type=chunk)[4](index=4&type=chunk) - The ECO Synthesis® platform received significant industry validation at the **TIDES USA Annual Meeting**, with presentations from CDMOs like Bachem, Nitto Avecia, and ST Pharm confirming the technology's transferability[2](index=2&type=chunk)[4](index=4&type=chunk) - **Cynthia Collins**, an expert in the CDMO landscape, was appointed to the **Board of Directors**, strengthening the company's strategic oversight[4](index=4&type=chunk) [Second Quarter 2025 Financial Highlights](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) Codexis achieved $15.3 million in Q2 2025 revenues, improving product gross margin to 72% and narrowing net loss Q2 2025 vs Q2 2024 Financial Performance | Financial Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $15.3 million | $8.0 million | +91.6% | | Product Gross Margin | 72% | 45% | +27 p.p. | | R&D Expenses | $13.8 million | $11.4 million | +21.1% | | SG&A Expenses | $12.3 million | $15.7 million | -21.7% | | Net Loss | $13.3 million | $22.8 million | Improved | | Net Loss Per Share | $0.16 | $0.32 | Improved | - The increase in total revenues was primarily attributed to the variability in customers' manufacturing schedules, clinical trial progression, higher revenue from legacy agreements, and a new licensing agreement[7](index=7&type=chunk) - As of June 30, 2025, the company maintained a cash, cash equivalents, and short-term investments balance of **$66.3 million**[7](index=7&type=chunk) [Upcoming Milestones](index=2&type=section&id=Upcoming%20Milestones) Codexis outlined key 2025 milestones: TIDES Europe presentation, pilot-scale GLP-grade siRNA, and GMP scale-up partner - Key upcoming milestones for 2025 include: - Presenting at the **TIDES Europe Annual Meeting** in November - Achieving pilot scale production of **GLP-grade siRNA material** via the ECO Synthesis Innovation Lab - Signing a **GMP scale-up partner** by year-end to enable larger scale siRNA production[7](index=7&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) This section presents unaudited consolidated financial statements: Operations, Comprehensive Loss, and Balance Sheets [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Total revenues nearly doubled to $15.3 million in Q2 2025, reducing loss from operations and net loss Condensed Consolidated Statements of Operations (In Thousands, Except Per Share Amounts) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | **Total revenues** | **$15,328** | **$7,979** | **$22,871** | **$25,052** | | Product revenue | $7,380 | $6,259 | $13,439 | $15,810 | | Research and development revenue | $7,948 | $1,720 | $9,432 | $9,242 | | **Total costs and operating expenses** | **$28,190** | **$30,711** | **$56,219** | **$59,672** | | Cost of product revenue | $2,098 | $3,462 | $4,830 | $8,317 | | Research and development | $13,775 | $11,413 | $26,717 | $22,659 | | Selling, general and administrative | $12,317 | $15,671 | $24,672 | $28,531 | | **Loss from operations** | **$(12,862)** | **$(22,732)** | **$(33,348)** | **$(34,620)** | | **Net loss** | **$(13,272)** | **$(22,755)** | **$(33,960)** | **$(34,260)** | | **Net loss per share, basic and diluted** | **$(0.16)** | **$(0.32)** | **$(0.40)** | **$(0.49)** | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets were $138.2 million, cash $66.3 million, liabilities $82.6 million, and equity $55.6 million Condensed Consolidated Balance Sheet Highlights (In Thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $26,761 | $19,264 | | Short-term investments | $39,569 | $54,194 | | Total current assets | $88,729 | $98,772 | | **Total assets** | **$138,246** | **$149,011** | | **Liabilities and Stockholders' Equity** | | | | Total current liabilities | $15,237 | $23,648 | | Long-term debt | $39,373 | $28,905 | | **Total liabilities** | **$82,615** | **$82,084** | | **Total stockholders' equity** | **$55,631** | **$66,927** | | **Total liabilities and stockholders' equity** | **$138,246** | **$149,011** | [About Codexis & Forward-Looking Statements](index=3&type=section&id=About%20Codexis%20%26%20Forward-Looking%20Statements) This section provides a corporate overview of Codexis's enzymatic solutions and platforms, with a forward-looking statements disclaimer - Codexis leverages its **CodeEvolver®** technology platform to develop high-performance enzymes for small molecule pharmaceuticals and nucleic acid synthesis, and is currently developing its **ECO Synthesis®** platform for manufacturing **RNAi therapeutics**[8](index=8&type=chunk) - The press release contains **forward-looking statements** concerning anticipated milestones, financial expectations, and the potential of its technology platforms, subject to **risks and uncertainties** detailed in the company's **SEC filings**[9](index=9&type=chunk)

[Corporate Updates & Highlights](index=1&type=section&id=Corporate%20Updates%20%26%20Highlights) Allogene reported significant progress in Q2 2025, advancing the pivotal ALPHA3 trial for cema-cel, initiating the RESOLUTION trial for ALLO-329 in autoimmune diseases, and aligning with the FDA on a pivotal path for ALLO-316 in solid tumors, ending the quarter with a strong cash position extending its runway into the second half of 2027 - Key strategic advancements include streamlining the ALPHA3 trial, initiating clinical enrollment for ALLO-329 in autoimmune indications, and aligning with the FDA on a pivotal path for ALLO-316 in solid tumors[3](index=3&type=chunk) - The company ended Q2 2025 with **$302.6 million** in cash, cash equivalents, and investments, with a projected cash runway into the **second half of 2027**[8](index=8&type=chunk)[10](index=10&type=chunk) [Program Updates](index=1&type=section&id=Program%20Updates) The company provided updates on its key clinical programs, including the pivotal Phase 2 ALPHA3 trial for cema-cel, the initiated Phase 1 RESOLUTION trial for ALLO-329 in autoimmune diseases, and the aligned pivotal trial design for ALLO-316 with the FDA [Cema-Cel: Pivotal Phase 2 ALPHA3 Trial in LBCL](index=1&type=section&id=Cema-Cel%3A%20Pivotal%20Phase%202%20ALPHA3%201L%20Consolidation%20Trial%20in%20LBCL) The ALPHA3 trial for cema-cel in Large B-Cell Lymphoma (LBCL) will now proceed as a two-arm randomized study, comparing cema-cel with standard fludarabine and cyclophosphamide (FC) lymphodepletion against observation, supported by early safety and biomarker data, with a futility analysis scheduled for the first half of 2026 and over 50 clinical sites activated - The ALPHA3 trial is now a randomized two-arm study comparing cema-cel with standard fludarabine and cyclophosphamide (FC) lymphodepletion to observation, the current standard of care[4](index=4&type=chunk) - The selection of the FC regimen is based on encouraging preliminary safety, MRD conversion rates, and operational benefits for community cancer centers[5](index=5&type=chunk) - A futility analysis comparing MRD conversion rates between the two arms is expected in **1H 2026**[6](index=6&type=chunk)[8](index=8&type=chunk) - **Over 50** clinical sites are activated across the U.S. and Canada, with international expansion underway[6](index=6&type=chunk)[8](index=8&type=chunk) [ALLO-329: Phase 1 RESOLUTION Trial in Autoimmune Disease (AID)](index=1&type=section&id=ALLO-329%3A%20Phase%201%20RESOLUTION%20Trial%20in%20Autoimmune%20Disease%20%28AID%29) The Phase 1 RESOLUTION basket trial for ALLO-329 was initiated in Q2 2025 for rheumatology indications like lupus and systemic sclerosis, featuring a first-in-class dual CAR T product incorporating Dagger® technology with initial proof-of-concept data expected in the first half of 2026 - The Phase 1 RESOLUTION basket trial was launched in **Q2 2025** for rheumatology, including conditions such as systemic lupus erythematosus, idiopathic inflammatory myopathies, and systemic sclerosis[7](index=7&type=chunk) - The trial features two lymphodepletion arms: one with cyclophosphamide alone and one with no lymphodepletion[7](index=7&type=chunk) - ALLO-329 is a first-in-class allogeneic CD19/CD70 dual CAR T product incorporating Dagger® technology to potentially reduce the need for lymphodepletion[9](index=9&type=chunk) - First clinical update with biomarker and proof-of-concept data is expected in **1H 2026**[7](index=7&type=chunk)[8](index=8&type=chunk) [ALLO-316: TRAVERSE Trial in RCC](index=1&type=section&id=ALLO-316%3A%20TRAVERSE%20Trial%20in%20RCC) Enrollment in the Phase 1b cohort for ALLO-316 in advanced Renal Cell Carcinoma (RCC) is complete, with updated data presented at ASCO 2025 showing clinical responses and robust cell expansion, leading to alignment with the FDA on a pivotal trial design that supports potential partnership discussions - Enrollment is complete for the Phase 1b cohort evaluating ALLO-316 in heavily pretreated advanced or metastatic Renal Cell Carcinoma (RCC)[9](index=9&type=chunk) - Updated Phase 1b results presented at **ASCO 2025** highlighted clinical responses and the potential of Dagger® technology[8](index=8&type=chunk)[9](index=9&type=chunk) - The company has aligned with the FDA on a pivotal trial design, setting the stage for potential partnership discussions[3](index=3&type=chunk)[8](index=8&type=chunk)[9](index=9&type=chunk) [Financial Results Summary](index=2&type=section&id=2025%20Second%20Quarter%20Financial%20Results) For the second quarter of 2025, Allogene reported a net loss of $50.9 million, ending the quarter with $302.6 million in cash, cash equivalents, and investments, with a projected cash runway into the second half of 2027 and full-year 2025 GAAP operating expenses expected to be approximately $230 million Key Financial Metrics for Q2 2025 | Metric | Value (USD) | | :--- | :--- | | Cash, Cash Equivalents, and Investments (as of June 30, 2025) | $302.6 million | | Research and Development Expenses | $40.2 million | | General and Administrative Expenses | $14.3 million | | Net Loss | $50.9 million | | Net Loss per Share | $0.23 | - Cash runway is expected to extend into the **second half of 2027**[10](index=10&type=chunk) - 2025 guidance includes an expected decrease in cash of approximately **$150 million** and GAAP Operating Expenses of approximately **$230 million**, including about **$45 million** in non-cash stock-based compensation[10](index=10&type=chunk) [Selected Financial Data](index=4&type=section&id=SELECTED%20FINANCIAL%20DATA) The detailed financial tables show a year-over-year decrease in operating expenses and net loss for Q2 2025, with the balance sheet reflecting a reduction in cash and total assets since the end of 2024, consistent with the company's operational spending [Statements of Operations](index=4&type=section&id=STATEMENTS%20OF%20OPERATIONS) For the three months ended June 30, 2025, Allogene reported total operating expenses of $56.8 million, a decrease from $71.4 million in the same period of 2024, resulting in a net loss of $50.9 million, or $0.23 per share, compared to a net loss of $66.4 million, or $0.35 per share, in Q2 2024 Consolidated Statements of Operations (Unaudited) | | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | | :--- | :--- | :--- | | Research and development | $40,156 | $50,355 | | General and administrative | $14,281 | $16,087 | | Total operating expenses | $56,819 | $71,431 | | Loss from operations | $(56,819) | $(71,431) | | Net loss | $(50,943) | $(66,358) | | Net loss per share, basic and diluted | $(0.23) | $(0.35) | [Selected Balance Sheet Data](index=4&type=section&id=SELECTED%20BALANCE%20SHEET%20DATA) As of June 30, 2025, Allogene had $302.6 million in cash, cash equivalents, and investments, a decrease from $373.1 million at the end of 2024, with total assets at $470.6 million and total stockholders' equity at $344.6 million Selected Balance Sheet Data (Unaudited) | | As of June 30, 2025 (in thousands) | As of December 31, 2024 (in thousands) | | :--- | :--- | :--- | | Cash, cash equivalents and investments | $302,630 | $373,149 | | Total assets | $470,593 | $548,710 | | Total liabilities | $126,032 | $126,531 | | Total stockholders' equity | $344,561 | $422,179 |

[Q2 2025 Earnings Release](index=1&type=section&id=Q2%202025%20Earnings%20Release) [Performance Highlights & Management Commentary](index=1&type=section&id=Performance%20Highlights%20%26%20Management%20Commentary) The company achieved record Q2 2025 revenue and deliveries, minimized its operating loss, and generated positive free cash flow through disciplined execution and strategic partnerships - Achieved record unit deliveries of **135 units** and record revenue of **$18.4 million** in Q2 2025[1](index=1&type=chunk)[4](index=4&type=chunk) - Posted the lowest operating loss since going public at **$7.1 million**, reflecting a **$4.7 million (35%) year-over-year reduction** in operating expenses[1](index=1&type=chunk)[4](index=4&type=chunk) - Generated the highest-ever positive free cash flow and net cash from operating activities of **$4.6 million**[1](index=1&type=chunk)[4](index=4&type=chunk) - Management emphasized a **"fleet-first" growth strategy** and diversification into a complete electrification platform, including powertrain systems and mobile charging Hubs[3](index=3&type=chunk)[5](index=5&type=chunk) [Financial Results](index=2&type=section&id=Financial%20Results) [Q2 2025 Financial Performance](index=2&type=section&id=Q2%202025%20Financial%20Performance) The company reported significant Q2 2025 revenue growth to $18.4 million and narrowed its net loss to $7.5 million, despite a lower gross margin from product mix changes Q2 2025 Key Financial Metrics (in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Revenues | $18.4 | $5.9 | $15.5 | | Gross Profit | $1.6 | $1.2 | $2.0 | | Loss from Operations | $(7.1) | $(9.3) | $(11.4) | | Net Loss | $(7.5) | $(10.2) | $(9.7) | - Gross margin for Q2 2025 was **8.8%**, a decrease from 20.6% in the previous quarter and 13.1% in Q2 2024, attributed to product mix and unfavorable inventory adjustments[4](index=4&type=chunk) Six Months Ended June 30 Financials (in thousands) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenues | $24,272 | $28,697 | | Gross Profit | $2,830 | $4,818 | | Loss from Operations | $(16,350) | $(21,611) | | Net Loss | $(17,691) | $(20,666) | [Balance Sheet](index=6&type=section&id=Balance%20Sheet) The company's balance sheet as of June 30, 2025, showed total assets of $80.3 million and cash of $8.8 million, with reductions in both assets and liabilities from year-end 2024 Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $8,785 | $10,996 | | Inventories | $31,012 | $36,567 | | Total Assets | $80,349 | $98,333 | | Total Liabilities | $62,021 | $64,723 | | Total Stockholders' Equity | $18,328 | $33,610 | [2025 Full-Year Outlook](index=2&type=section&id=2025%20Full-Year%20Outlook) The company maintained its 2025 revenue and delivery guidance but revised its Non-GAAP operating loss forecast upward due to changes in product mix and tariff costs 2025 Full-Year Guidance | Metric | Outlook | | :--- | :--- | | Revenue | $50.2 to $65.8 million | | Unit Deliveries | 320 to 420 units | | Non-GAAP operating loss | $26.9 to $24.4 million | - The Non-GAAP operating loss guidance was revised upward from a previous range of $14.0 to $17.2 million due to expected product mix changes and increased tariff-related costs[7](index=7&type=chunk)[8](index=8&type=chunk) [Non-GAAP Financial Measures & Reconciliations](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) The company's non-GAAP measures show improved operational performance, highlighted by a positive $4.6 million in Free Cash Flow and a narrowed Non-GAAP operating loss of $6.9 million - The company uses non-GAAP measures including Free Cash Flow (Operating cash flow less CapEx), Non-GAAP operating loss (adjusted for stock-based compensation and inventory items), and Non-GAAP gross profit (adjusted for inventory items)[14](index=14&type=chunk)[15](index=15&type=chunk) Reconciliation of Key Non-GAAP Measures (Q2 2025 vs Q2 2024, in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Free Cash Flow | $4,645 | $(26,113) | | Non-GAAP Operating Loss | $(6,860) | $(9,737) | | Non-GAAP Gross Profit | $266 | $2,027 | [Supplementary Information](index=3&type=section&id=Supplementary%20Information) This section provides details for the investor conference call, an overview of the company's business, and cautionary statements on forward-looking information - The company scheduled a conference call and webcast on August 13, 2025, to discuss the quarterly results[10](index=10&type=chunk) - Xos positions itself as a technology company, electric truck manufacturer, and fleet services provider for last-mile, back-to-base commercial vehicles[12](index=12&type=chunk) - The report includes a "Cautionary Statement Regarding Forward-Looking Statements" detailing numerous risks and uncertainties, including liquidity, supply chain issues, and industry competition, that could affect future results[17](index=17&type=chunk)[18](index=18&type=chunk)

[Unaudited Condensed Interim Consolidated Statements of Financial Position](index=2&type=section&id=Unaudited%20Condensed%20Interim%20Consolidated%20Statements%20of%20Financial%20Position) [Financial Position Overview](index=2&type=section&id=Financial%20Position%20Overview) As of June 30, 2025, Vox Royalty Corp. reported total assets of **$62.59 million**, an increase from **$51.38 million** at December 31, 2024, driven by increased royalty interests and a new credit facility, while total liabilities rose to **$20.26 million** from **$8.32 million**, and total equity slightly decreased to **$42.33 million** from **$43.06 million** Financial Position Summary | Metric | June 30, 2025 ($) | December 31, 2024 ($) | Change ($) | Change (%) | | :----------------------- | :------------------ | :-------------------- | :--------- | :--------- | | **Assets** | | | | | | Total current assets | 13,618,367 | 12,129,014 | 1,489,353 | 12.28% | | Royalty interests | 47,893,583 | 37,984,188 | 9,909,395 | 26.09% | | Total assets | 62,586,700 | 51,381,324 | 11,205,376 | 21.81% | | **Liabilities** | | | | | | Total current liabilities | 3,135,231 | 2,894,675 | 240,556 | 8.31% | | Credit facility | 11,700,000 | - | 11,700,000 | N/A | | Total liabilities | 20,258,032 | 8,321,125 | 11,936,907 | 143.45% | | **Equity** | | | | | | Total equity | 42,328,668 | 43,060,199 | (731,531) | -1.70% | [Unaudited Condensed Interim Consolidated Statements of Loss and Comprehensive Loss](index=3&type=section&id=Unaudited%20Condensed%20Interim%20Consolidated%20Statements%20of%20Loss%20and%20Comprehensive%20Loss) [Loss and Comprehensive Loss Overview](index=3&type=section&id=Loss%20and%20Comprehensive%20Loss%20Overview) For the three months ended June 30, 2025, net loss increased to **$387,957** from **$333,588** in the prior year, and for the six months, it widened to **$747,097** from **$574,975**, primarily due to higher depletion, interest, and income tax expenses despite increased other income Loss and Comprehensive Loss Summary | Metric | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :-------------------------------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Royalty revenue | 2,765,145 | 2,839,117 | 5,445,339 | 5,721,629 | | Depletion | (1,018,232) | (732,129) | (1,803,354) | (1,200,502) | | Gross profit | 1,746,913 | 2,106,988 | 3,641,985 | 4,521,127 | | Total operating expenses | (1,924,686) | (1,898,570) | (3,716,227) | (3,702,195) | | Income (loss) from operations | (177,773) | 208,418 | (74,242) | 818,932 | | Interest and finance expenses | (182,564) | (80,207) | (267,952) | (153,912) | | Other income | 200,208 | 149,000 | 273,941 | 112,906 | | Income (loss) before income taxes | (160,129) | 277,211 | (68,253) | 777,926 | | Income tax expense | (227,828) | (610,799) | (678,844) | (1,352,901) | | Net loss and comprehensive loss | (387,957) | (333,588) | (747,097) | (574,975) | | Basic Loss per share | (0.01) | (0.01) | (0.01) | (0.01) | | Diluted Loss per share | (0.01) | (0.01) | (0.01) | (0.01) | [Unaudited Condensed Interim Consolidated Statements of Changes in Equity](index=3&type=section&id=Unaudited%20Condensed%20Interim%20Consolidated%20Statements%20of%20Changes%20in%20Equity) [Changes in Equity Overview](index=3&type=section&id=Changes%20in%20Equity%20Overview) Total equity decreased from **$43.06 million** at January 1, 2025, to **$42.33 million** at June 30, 2025, mainly due to declared dividends and net loss, partially offset by share-based compensation and dividend reinvestment plan share issuances Changes in Equity | Metric | January 1, 2025 ($) | June 30, 2025 ($) | Change ($) | | :-------------------------- | :------------------ | :---------------- | :--------- | | Share Capital | 69,528,762 | 69,756,304 | 227,542 | | Equity Reserves | 4,722,776 | 5,779,683 | 1,056,907 | | Deficit | (31,191,339) | (33,207,319) | (2,015,980) | | Total Equity | 43,060,199 | 42,328,668 | (731,531) | - **Share issue costs:** **$(2,241)**[7](index=7&type=chunk) - **Dividends declared:** **$(1,268,883)**[7](index=7&type=chunk) - **Shares issued – dividends reinvestment plan:** **$9,152**[7](index=7&type=chunk) - **Settlement of RSUs:** **$0** (net effect on equity components)[7](index=7&type=chunk) - **Share-based compensation:** **$1,277,538**[7](index=7&type=chunk) - **Net loss and comprehensive loss:** **$(747,097)**[7](index=7&type=chunk) [Unaudited Condensed Interim Consolidated Statements of Cash Flows](index=4&type=section&id=Unaudited%20Condensed%20Interim%20Consolidated%20Statements%20of%20Cash%20Flows) [Cash Flows Overview](index=4&type=section&id=Cash%20Flows%20Overview) For the six months ended June 30, 2025, operating cash flows decreased to **$2.80 million**, investing activities used **$11.71 million** primarily for royalty acquisitions, and financing activities generated **$10.35 million** from a new credit facility, resulting in a **$1.44 million** increase in cash and cash equivalents to **$10.17 million** Cash Flow Summary | Metric | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :----------------------------------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Net cash flows from operating activities | 1,756,729 | 2,009,431 | 2,795,543 | 3,221,584 | | Net cash flows used in investing activities | (11,705,057) | (3,140,022) | (11,705,057) | (3,136,909) | | Net cash flows from (used in) financing activities | 10,982,327 | (628,191) | 10,351,788 | (1,611,849) | | Increase (decrease) in cash and cash equivalents | 1,033,999 | (1,758,782) | 1,442,274 | (1,527,174) | | Cash and cash equivalents, end of the period | 10,172,099 | 7,802,713 | 10,172,099 | 7,802,713 | - Acquisition of royalties significantly increased cash used in investing activities, reaching **$11,794,678** for the six months ended June 30, 2025, compared to **$3,165,173** in the prior year[9](index=9&type=chunk) - Proceeds from the credit facility of **$11,700,000** were a major contributor to cash flows from financing activities for the six months ended June 30, 2025[9](index=9&type=chunk) [Notes to the Unaudited Condensed Interim Consolidated Financial Statements](index=5&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Interim%20Consolidated%20Financial%20Statements) [1. Nature of operations](index=5&type=section&id=1.%20Nature%20of%20operations) Vox Royalty Corp. is a mining royalty company focused on expanding its royalty asset portfolio through accretive acquisitions, primarily in Australia, Canada, and the United States, with a strategic emphasis on producing or near-term producing assets - Vox Royalty Corp. is a mining royalty company focused on growing its royalty asset portfolio through accretive acquisitions[14](index=14&type=chunk) - Approximately **90%** of the Company's royalty assets by royalty count are located in Australia, Canada, and the United States[14](index=14&type=chunk) - The Company prioritizes acquiring royalties on producing or near-term producing assets (six months to three years from first production)[14](index=14&type=chunk) [2. Basis of preparation](index=5&type=section&id=2.%20Basis%20of%20preparation) These unaudited condensed interim consolidated financial statements are prepared in accordance with IAS 34, presented in United States dollars on a historical cost basis, and the Company is assessing the impact of the new IFRS 18 standard effective January 1, 2027 - Statements are prepared in accordance with International Accounting Standards 34, Interim Financial Reporting[15](index=15&type=chunk) - The financial statements are presented in United States dollars, which is the functional currency of the Company and its wholly-owned subsidiaries[17](index=17&type=chunk) - The Company is currently assessing the impact of IFRS 18 – Presentation and Disclosure in Financial Statements, which is effective for reporting periods beginning on or after January 1, 2027[21](index=21&type=chunk) [3. Significant judgments, estimates and assumptions](index=6&type=section&id=3.%20Significant%20judgments%2C%20estimates%20and%20assumptions) The preparation of financial statements requires management to make significant judgments, estimates, and assumptions, which are continuously evaluated based on experience and future expectations, with complex areas consistent with prior annual statements - Management makes judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses[22](index=22&type=chunk) - Estimates and assumptions are continuously evaluated and are based on management's experience and expectations of future events[22](index=22&type=chunk) - The areas involving a higher degree of judgment or complexity were the same as those applied to the Company's annual financial statements for the year ended December 31, 2024[23](index=23&type=chunk) [4. Accounts receivable](index=6&type=section&id=4.%20Accounts%20receivable) Accounts receivable totaled **$2,986,652** as of June 30, 2025, a slight increase from **$2,917,680** at December 31, 2024, with the majority consisting of royalties receivable typically collected within 45 days Accounts Receivable Summary | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :--------------- | :---------------- | :-------------------- | | Royalties receivable | 2,979,736 | 2,897,870 | | Sales tax recoverable | 6,916 | 19,810 | | **Total** | **2,986,652** | **2,917,680** | - Royalties receivable generally collected within **45 days** of quarter-end[24](index=24&type=chunk) [5. Royalty interests](index=7&type=section&id=5.%20Royalty%20interests) Total royalty interests significantly increased to **$47,893,583** at June 30, 2025, from **$37,984,188** at December 31, 2024, primarily due to the **$11,712,749** acquisition of the Kanmantoo copper-gold royalty, with Australia holding the largest share Royalty Interests by Country | Country | June 30, 2025 ($) | December 31, 2024 ($) | | :------------ | :---------------- | :-------------------- | | Australia | 40,384,292 | 30,452,281 | | Canada | 2,756,817 | 2,756,817 | | USA | 2,204,452 | 2,210,330 | | South Africa | 1,914,844 | 1,914,844 | | Brazil | 587,569 | 604,307 | | Peru | 45,609 | 45,609 | | **Total** | **47,893,583** | **37,984,188** | - On May 15, 2025, the Company acquired the producing Kanmantoo copper-gold royalty for a net purchase price of **$11,712,749**[28](index=28&type=chunk) - Deferred royalty acquisitions of **$26,987** as at June 30, 2025, relate to costs incurred prior to the execution and closing of a royalty acquisition[28](index=28&type=chunk) [6. Credit facility](index=8&type=section&id=6.%20Credit%20facility) The Company established a **$15 million** secured revolving credit facility with BMO, drawing **$11.7 million** by June 30, 2025, for the Kanmantoo royalty acquisition, and subsequently repaid **$5 million** while remaining compliant with all covenants - The Company has a **$15,000,000** secured revolving credit facility with BMO, with an accordion feature for an additional **$10,000,000**[29](index=29&type=chunk) - On May 14, 2025, an initial drawdown of **$11,700,000** was made under the BMO Facility, with proceeds allocated to the acquisition of the Kanmantoo copper-gold royalty[30](index=30&type=chunk) - Subsequent to June 30, 2025, the Company repaid **$5,000,000** of the outstanding Facility balance[31](index=31&type=chunk) Interest and Finance Expenses | Expense Category | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :-------------------------------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Amortization of Facility transaction costs | 64,295 | 58,879 | 128,589 | 107,646 | | Interest expense on Facility | 118,269 | 21,328 | 139,363 | 46,266 | | **Total Interest and finance expenses** | **182,564** | **80,207** | **267,952** | **153,912** | [7. Intangible assets](index=9&type=section&id=7.%20Intangible%20assets) Intangible assets, consisting solely of the Mineral Royalties Online (MRO) royalty database, decreased in net book value to **$896,861** at June 30, 2025, from **$988,631** at December 31, 2024, due to amortization - Intangible assets are comprised of the Mineral Royalties Online (MRO) royalty database[34](index=34&type=chunk) Intangible Assets Net Book Value | Metric | December 31, 2024 ($) | June 30, 2025 ($) | | :---------------------- | :-------------------- | :---------------- | | Cost | 1,837,500 | 1,837,500 | | Accumulated amortization | 848,869 | 940,639 | | **Net book value** | **988,631** | **896,861** | - Amortization expense for the six months ended June 30, 2025, was **$91,770**[35](index=35&type=chunk) [8. Accounts payable and accrued liabilities](index=9&type=section&id=8.%20Accounts%20payable%20and%20accrued%20liabilities) Accounts payable and accrued liabilities decreased to **$1,221,203** at June 30, 2025, from **$1,390,507** at December 31, 2024, primarily due to a reduction in accrued liabilities Accounts Payable and Accrued Liabilities | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :---------------------- | :---------------- | :-------------------- | | Trade payables | 123,585 | 118,481 | | Sales tax payable | 563,603 | 487,901 | | Accrued liabilities | 534,015 | 784,125 | | **Total** | **1,221,203** | **1,390,507** | [9. Share capital](index=9&type=section&id=9.%20Share%20capital) As of June 30, 2025, the Company had **50,756,371** common shares outstanding, renewed a Share Repurchase Program for up to **$1.5 million** without repurchases during the period, and declared quarterly dividends of **$0.0125** per share, with a Dividend Reinvestment Plan Common Shares Issued and Outstanding | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------------------------------------------- | :------------ | :---------------- | | Issued and outstanding common shares | 50,756,371 | 50,658,776 | | Share capital ($) | 69,756,304 | 69,528,762 | - The Board of Directors approved the renewal of a Share Repurchase Program (SRP) for up to **$1,500,000** of its common shares on March 12, 2025[40](index=40&type=chunk) - The Company did not repurchase any shares under the SRP during the six months ended June 30, 2025[42](index=42&type=chunk) Dividends Declared | Declaration date | Dividend per common share ($) | Record date | Payment date | Dividends declared ($) | | :--------------- | :---------------------------- | :---------- | :----------- | :--------------------- | | February 20, 2025 | 0.0125 | March 31, 2025 | April 14, 2025 | 634,426 | | May 15, 2025 | 0.0125 | June 30, 2025 | July 14, 2025 | 634,457 | | **Total** | **0.0250** | | | **1,268,883** | - Total dividends paid for the six months ended June 30, 2025, included **$9,152** paid in shares through the dividend reinvestment program (**3,740** common shares issued at a **5%** discount)[46](index=46&type=chunk) [10. Equity reserves](index=11&type=section&id=10.%20Equity%20reserves) Equity reserves include stock options, restricted share units (RSUs), and warrants, with **848,010** RSUs granted during the period and **6,407,883** warrants expiring unexercised in 2024 [10.1 Options](index=11&type=section&id=10.1%20Options) Stock option activity for the six months ended June 30, 2025, showed no new grants or cancellations, maintaining **1,346,838** options outstanding with a weighted average exercise price of **C$3.70**, all exercisable at period end Stock Option Activity | Metric | June 30, 2025 (Number) | June 30, 2024 (Number) | | :------------------------ | :--------------------- | :--------------------- | | Outstanding, beginning of period | 1,346,838 | 1,347,398 | | Granted | - | 240,000 | | Cancelled | - | (240,560) | | Outstanding, end of period | 1,346,838 | 1,346,838 | | Exercisable, end of period | 1,346,838 | 1,226,838 | Outstanding and Exercisable Options | Expiry date | Exercise price (C$) | Number of options outstanding | Weighted average remaining contractual life (Years) | Number of options exercisable | Weighted average remaining contractual life (Years) | | :---------- | :------------------ | :---------------------------- | :-------------------------------------------------- | :---------------------------- | :-------------------------------------------------- | | June 30, 2026 | 3.25 | 680,703 | 1.00 | 680,703 | 1.00 | | March 9, 2027 | 4.16 | 666,135 | 1.69 | 666,135 | 1.69 | | **Total** | | **1,346,838** | **1.34** | **1,346,838** | **1.34** | [10.2 Restricted Share Unit Plan](index=11&type=section&id=10.2%20Restricted%20Share%20Unit%20Plan) During the six months ended June 30, 2025, **848,010** Restricted Share Units (RSUs) were granted, increasing total outstanding RSUs to **2,063,216** and vested RSUs to **962,939**, with vesting schedules extending into 2027 - **829,915** RSUs were granted to directors, officers, and employees, vesting in **25%** increments on specific dates from July 2, 2025, to January 2, 2027[50](index=50&type=chunk) - An additional **18,095** RSUs were granted to an employee, vesting on September 16, 2025[50](index=50&type=chunk) Restricted Share Unit Activity | Metric | June 30, 2025 (Number) | June 30, 2024 (Number) | | :------------------------ | :--------------------- | :--------------------- | | Outstanding, beginning of period | 1,309,061 | 952,018 | | Granted | 848,010 | 968,448 | | Exercised | (93,855) | (230,652) | | Outstanding, end of period | 2,063,216 | 1,689,814 | | Vested, end of period | 962,939 | 761,591 | [10.3 Warrants](index=12&type=section&id=10.3%20Warrants) During the six months ended June 30, 2024, **6,407,883** warrants expired unexercised - **6,407,883** warrants expired unexercised during the six months ended June 30, 2024[52](index=52&type=chunk) [11. General and administration](index=12&type=section&id=11.%20General%20and%20administration) General and administration expenses for the six months ended June 30, 2025, were **$2,245,663**, a slight increase from **$2,229,205** in the prior year, with salaries and benefits remaining the largest component General and Administration Expenses | Expense Category | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :-------------------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Corporate administration | 320,198 | 293,039 | 574,639 | 561,516 | | Professional fees | 98,627 | 102,916 | 215,728 | 206,568 | | Salaries and benefits | 606,265 | 640,752 | 1,283,246 | 1,302,893 | | Director fees | 40,150 | 36,479 | 80,280 | 66,458 | | Amortization | 45,885 | 45,885 | 91,770 | 91,770 | | **Total** | **1,111,125** | **1,119,071** | **2,245,663** | **2,229,205** | [12. Other income](index=12&type=section&id=12.%20Other%20income) Other income for the six months ended June 30, 2025, significantly increased to **$273,941** from **$112,906** in the prior year, primarily driven by a foreign exchange recovery offsetting decreased interest income Other Income Breakdown | Category | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :-------------------------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Interest income | 106,262 | 124,531 | 198,546 | 246,182 | | Foreign exchange recovery (expense) | 93,946 | 24,469 | 75,395 | (133,276) | | **Total** | **200,208** | **149,000** | **273,941** | **112,906** | [13. Related party transactions](index=13&type=section&id=13.%20Related%20party%20transactions) Key management personnel compensation for the six months ended June 30, 2025, totaled **$2,189,595**, a decrease from **$2,333,060** in the prior year, encompassing short-term employee benefits and share-based compensation Key Management Personnel Compensation | Compensation Type | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :------------------------ | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Short-term employee benefits | 480,253 | 530,542 | 1,052,271 | 1,068,879 | | Share-based compensation | 607,480 | 668,817 | 1,137,324 | 1,264,181 | | **Total** | **1,087,733** | **1,119,359** | **2,189,595** | **2,333,060** | [14. Commitments and contingencies](index=13&type=section&id=14.%20Commitments%20and%20contingencies) The Company is involved in legal proceedings, including a Mt Ida settlement and ongoing claims for Red Hill and against Titan Minerals, alongside commitments for lease and consulting payments, and contingent milestone payments totaling over **$9.4 million** for royalty acquisitions [14.1 Litigation matter](index=13&type=section&id=14.1%20Litigation%20matter) Vox Australia settled a claim regarding the Mt Ida royalty asset, is defending a claim related to the Red Hill royalty assignment, and is pursuing a claim against Titan Minerals Limited for replacement royalties or damages - Vox Australia discontinued its claim in the Supreme Court of Western Australia regarding the Mt Ida royalty asset after reaching a settlement agreement on May 28, 2025[59](index=59&type=chunk) - Vox Australia is a second defendant in a claim regarding the Red Hill royalty assignment, with the plaintiff alleging a breach of a right of first refusal; the Company denies the claim and will defend the action[61](index=61&type=chunk)[62](index=62&type=chunk) - SilverStream filed a claim against Titan Minerals Limited to enforce its rights to be issued replacement royalties and/or damages for Titan's failure to maintain mining concessions in Peru, which led to the impairment of four royalties in 2023[64](index=64&type=chunk)[65](index=65&type=chunk) [14.2 Commitments](index=14&type=section&id=14.2%20Commitments) The Company has minimum annual lease payments of **$3,872** and consulting agreement payments of **$58,797** for the period July 1, 2025, to June 30, 2026 Annual Commitments | Category | July 1, 2025 to June 30, 2026 ($) | | :------------------ | :-------------------------------- | | Leases | 3,872 | | Consulting agreements | 58,797 | | **Total** | **62,669** | [14.3 Contingencies](index=14&type=section&id=14.3%20Contingencies) The Company is committed to potential milestone payments totaling **$9,443,332** for various royalty acquisitions, payable upon achieving specific thresholds and mostly settleable in cash or common shares at the Company's election Contingent Milestone Payments | Royalty | Milestone Payment ($) | | :------------------ | :-------------------- | | Limpopo | 6,523,492 | | Brits | 1,250,000 | | Bullabulling | 655,941 | | Koolyanobbing | 327,970 | | El Molino | 450,000 | | Uley | 144,307 | | Other | 91,622 | | **Total** | **9,443,332** | - Most milestone payments may be settled in either cash or common shares of the Company, at the Company's election[67](index=67&type=chunk)[68](index=68&type=chunk) [15. Supplemental cash flow information](index=15&type=section&id=15.%20Supplemental%20cash%20flow%20information) Supplemental cash flow information details non-cash working capital changes, including adjustments for accrued other assets, deferred royalty acquisitions, royalty interests, interest expense on the credit facility, and share issue costs Supplemental Cash Flow Adjustments | Category | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :------------------------------------ | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Change in accrued other assets | - | (24,594) | (2,615) | (271,029) | | Change in accrued deferred royalty acquisitions | (3,438) | 10 | 12,057 | 12,940 | | Change in accrued royalty interests | - | 5,500 | - | 5,500 | | Change in accrued interest expense on Facility | 29,655 | (3,610) | 29,186 | 21,328 | | Change in accrued share issue costs | - | (23,599) | - | - | [16. Segment information](index=15&type=section&id=16.%20Segment%20information) The Company operates in a single reportable segment of royalty interest acquisition, with Australia remaining the primary source of revenue and holding the largest share of non-current assets for the six months ended June 30, 2025 - The Company operated in one reportable segment: the acquisition of royalty interests[70](index=70&type=chunk) Revenue by Geographic Location | Geographic Location | Six months ended June 30, 2025 (Revenue $) | Six months ended June 30, 2024 (Revenue $) | | :------------------ | :--------------------------------------- | :--------------------------------------- | | Australia | 5,396,544 | 5,701,312 | | Brazil | 33,290 | 4,812 | | USA | 15,505 | 15,505 | | **Total** | **5,445,339** | **5,721,629** | Non-current Assets by Geographic Location | Geographic Location | June 30, 2025 (Non-current assets $) | December 31, 2024 (Non-current assets $) | | :------------------ | :----------------------------------- | :--------------------------------------- | | Australia | 40,384,292 | 30,452,281 | | Canada | 2,934,706 | 3,036,308 | | USA | 2,204,452 | 2,210,330 | | South Africa | 1,914,844 | 1,914,844 | | Cayman Islands | 896,861 | 988,631 | | Brazil | 587,569 | 604,307 | | Peru | 45,609 | 45,609 | [17. Income taxes](index=16&type=section&id=17.%20Income%20taxes) Income tax expense for the six months ended June 30, 2025, was **$678,844**, a decrease from **$1,352,901** in the prior year, primarily due to lower current tax expense and a deferred tax recovery Income Tax Expense Breakdown | Tax Component | Three months ended June 30, 2025 ($) | Three months ended June 30, 2024 ($) | Six months ended June 30, 2025 ($) | Six months ended June 30, 2024 ($) | | :---------------------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Current tax expense | 178,517 | 587,235 | 682,493 | 1,178,386 | | Deferred tax expense (recovery) | 49,311 | 23,564 | (3,649) | 174,515 | | **Income tax expense** | **227,828** | **610,799** | **678,844** | **1,352,901** | [18. Financial instruments](index=16&type=section&id=18.%20Financial%20instruments) The Company's financial instruments are exposed to credit, liquidity, currency, interest rate, and commodity/share price risks, which are managed through various strategies including maintaining cash in high-quality institutions and not hedging future revenue [18.1 Credit risk](index=16&type=section&id=18.1%20Credit%20risk) Credit risk primarily arises from cash and cash equivalents and royalty receivables, mitigated by maintaining cash in high-quality financial institutions and closely monitoring royalty receivable balances - The Company's credit risk is primarily attributable to its liquid financial assets, including cash and cash equivalents and royalty receivables[74](index=74&type=chunk) - To mitigate credit risk, the Company maintains cash in high-quality financial institutions and closely monitors royalty receivable balances[74](index=74&type=chunk) [18.2 Liquidity risk](index=16&type=section&id=18.2%20Liquidity%20risk) The Company manages liquidity risk by ensuring sufficient funds to meet obligations, holding **$10,172,099** in cash and cash equivalents and **$10,483,136** in working capital as of June 30, 2025 - The Company's approach to managing liquidity is to ensure it will have sufficient liquidity to meet liabilities when due[75](index=75&type=chunk) Cash and Working Capital | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :-------------------------- | :---------------- | :-------------------- | | Cash and cash equivalents | 10,172,099 | 8,754,391 | | Working capital | 10,483,136 | 9,234,339 | [18.3 Currency risk](index=16&type=section&id=18.3%20Currency%20risk) The Company is exposed to foreign currency risk from Canadian and Australian dollar-denominated financial instruments, where a 10% fluctuation would impact net loss and comprehensive loss by approximately **$418,000** - Financial instruments denominated in Canadian and Australian dollars expose the Company to foreign currency risk[76](index=76&type=chunk) - A **10%** increase (decrease) of the value of the Canadian and Australian dollar relative to the United States dollar would increase (decrease) net loss and other comprehensive loss by **$418,000**[76](index=76&type=chunk) [18.4 Interest rate risk](index=17&type=section&id=18.4%20Interest%20rate%20risk) The Company is exposed to interest rate risk from its floating-rate credit facility, with a 1% rate change impacting net loss by approximately **$75,000**, and manages this by investing excess cash in short-term interest-bearing securities without using derivatives - The Company is exposed to interest rate risk due to the Facility being subject to floating interest rates[77](index=77&type=chunk) - A **1%** increase (decrease) in nominal interest rates would have increased (decreased) net loss and other comprehensive loss by approximately **$75,000** for the period ended June 30, 2025[77](index=77&type=chunk) - The Company's policy is to invest excess cash in cash accounts or short-term interest-bearing securities and does not use derivative instruments to reduce interest rate risk[78](index=78&type=chunk) [18.5 Commodity and share price risk](index=17&type=section&id=18.5%20Commodity%20and%20share%20price%20risk) The Company's royalties and profitability are significantly affected by fluctuations in underlying commodity market prices, particularly precious and base metals, with all future revenue unhedged to provide full shareholder exposure - The Company's royalties are subject to fluctuations from changes in market prices of the underlying commodities, which are the primary drivers of profitability and free cash flow[79](index=79&type=chunk) - All of the Company's future revenue is not hedged to provide shareholders with full exposure to changes in market prices of commodities[79](index=79&type=chunk) [18.6 Fair value of financial instruments](index=17&type=section&id=18.6%20Fair%20value%20of%20financial%20instruments) The carrying amounts of cash, receivables, payables, and income taxes payable approximate their fair value due to their limited term, and the Company had no financial instruments measured at fair value after initial recognition as of June 30, 2025, and December 31, 2024 - The carrying amounts for cash and cash equivalents, accounts receivables, accounts payable and accrued liabilities, and income taxes payable approximate fair value[81](index=81&type=chunk) - As at June 30, 2025, and December 31, 2024, the Company does not have any financial instruments measured at fair value after initial recognition[82](index=82&type=chunk) [18.7 Capital management](index=17&type=section&id=18.7%20Capital%20management) The Company's primary capital management objective is to maximize shareholder returns through accretive royalty acquisitions and an optimized capital structure, regularly reviewing cash flow forecasts and ensuring credit facility covenant compliance - The Company's primary objective when managing capital is to maximize returns for its shareholders by growing its asset base through accretive acquisitions of royalty interests, while optimizing its capital structure[83](index=83&type=chunk) - As at June 30, 2025, the capital structure consists of **$42,328,668** of total equity[83](index=83&type=chunk) - The Company is not subject to any externally imposed capital requirements other than those disclosed for the Facility[84](index=84&type=chunk) [19. Subsequent events](index=17&type=section&id=19.%20Subsequent%20events) Subsequent to June 30, 2025, the Company repaid **$5,000,000** of its credit facility on July 14, 2025, and declared a quarterly dividend of **$0.0125** per common share on August 13, 2025, payable on October 14, 2025 - On July 14, 2025, the Company repaid **$5,000,000** of the outstanding balance owing under the Facility[85](index=85&type=chunk) - On August 13, 2025, the Board of Directors declared a quarterly dividend of **$0.0125** per common share, payable on October 14, 2025[85](index=85&type=chunk)

[Part I - Financial Information](index=6&type=section&id=Part%20I%20-%20Financial%20Information) This section presents the company's unaudited condensed consolidated financial statements, management's analysis of operations, market risk disclosures, and internal controls [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) The unaudited condensed consolidated financial statements present the company's financial performance for the three and six months ended June 30, 2025, and 2024. Key statements include the income statement, balance sheet, and cash flow statement, which show revenue growth, an increase in total assets driven by intangible assets from acquisitions, and significant cash usage in investing activities [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) This statement details the company's revenue and net income performance for the three and six months ended June 30, 2025 and 2024 - For the six months ended June 30, 2025, **total revenues increased to $114.1 million** from $99.2 million year-over-year, driven by higher commission income, with **net income rising to $15.9 million** from $13.5 million in the prior year period[16](index=16&type=chunk) Condensed Consolidated Statements of Income (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total revenues** | **$60,308** | **$53,011** | **$114,131** | **$99,155** | | Commission income | $54,562 | $48,662 | $103,347 | $91,207 | | Operating income | $7,363 | $7,521 | $13,093 | $14,825 | | **Net income** | **$9,000** | **$6,918** | **$15,853** | **$13,547** | | Net income attributable to TWFG, Inc. | $1,957 | $— | $3,295 | $— | | **Basic EPS** | **$0.13** | **N/A** | **$0.22** | **N/A** | | **Diluted EPS** | **$0.13** | **N/A** | **$0.22** | **N/A** | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement outlines the company's financial position, including assets, liabilities, and equity, as of June 30, 2025, and December 31, 2024 - **Total assets increased to $342.8 million** as of June 30, 2025, from $323.4 million at December 31, 2024, primarily due to a significant increase in **intangible assets from $73.0 million to $125.9 million**, reflecting recent acquisition activity, while **cash and cash equivalents decreased from $195.8 million to $159.8 million**[20](index=20&type=chunk) Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $159,827 | $195,772 | | Intangible assets, net | $125,901 | $72,978 | | **Total assets** | **$342,849** | **$323,428** | | Total liabilities | $53,878 | $48,142 | | **Total stockholders' equity** | **$279,210** | **$275,286** | | **Total liabilities, redeemable noncontrolling interest and equity** | **$342,849** | **$323,428** | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement summarizes the company's cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 - For the six months ended June 30, 2025, **net cash provided by operating activities was $25.3 million**, while **net cash used in investing activities was significant at $46.7 million**, primarily for the purchase of intangible assets, and **net cash used in financing activities was $12.9 million**, largely due to distributions to members[26](index=26&type=chunk) Condensed Consolidated Cash Flows (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **$25,260** | **$17,154** | | **Net cash used in investing activities** | **($46,706)** | **($21,223)** | | Purchase of intangible assets | ($47,226) | ($21,241) | | **Net cash used in financing activities** | **($12,876)** | **($5,886)** | | Distributions to members | ($13,263) | ($7,099) | | **Net change in cash, cash equivalents and restricted cash** | **($34,322)** | **($9,955)** | [Notes to the Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures regarding the condensed consolidated financial statements, including significant acquisitions and revenue breakdown - During the six months ended June 30, 2025, the company completed **asset acquisitions totaling $36.8 million for intangible assets**, and acquired a **50.1% equity interest in TWFG MGA FL, LLC for $9.7 million**, recognizing a customer relationship asset of $19.4 million[43](index=43&type=chunk)[44](index=44&type=chunk) - The Progressive Corporation was a major customer, accounting for **11% and 13% of total revenues** for the three and six months ended June 30, 2025, respectively[42](index=42&type=chunk) Disaggregation of Revenues by Offerings (in thousands) | Offering | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Insurance Services | | | | Agency-in-a-box | $39,316 | $75,312 | | Corporate Branches | $11,393 | $19,615 | | TWFG MGA | $9,233 | $18,428 | | Other | $366 | $776 | | **Total revenues** | **$60,308** | **$114,131** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results, highlighting a 13.8% increase in total revenues for Q2 2025 and a 15.1% increase for H1 2025, primarily driven by higher commission income from increased premium rates and business growth. The discussion covers performance by business segment, key performance indicators like Total Written Premium (which grew 14.4% in Q2), an analysis of non-GAAP measures such as Organic Revenue Growth (10.6% in Q2), and the company's liquidity position, which remains strong following the IPO despite significant cash use for acquisitions [Results of Operations](index=27&type=section&id=Results%20of%20Operations) This section analyzes the company's revenue and expense trends, highlighting key factors influencing financial performance for the reported periods - For Q2 2025, **total revenues increased by 13.8% YoY to $60.3 million**, driven by a 12.1% increase in commission income and a 61.6% increase in contingent income, while for H1 2025, **total revenues grew 15.1% YoY to $114.1 million**, with commission income up 13.3%[119](index=119&type=chunk)[139](index=139&type=chunk) - **Salaries and employee benefits expense increased 39.3% in Q2 2025**, which included $1.5 million in stock-based compensation and costs from recent Corporate Branch acquisitions, and **other administrative expenses rose 44.2%** due to business growth and increased costs as a public company[131](index=131&type=chunk)[133](index=133&type=chunk) Total Revenues by Offering - Q2 Comparison (in thousands) | Offering | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Insurance Services | $50,709 | $43,773 | 15.8% | | TWFG MGA | $9,233 | $8,830 | 4.6% | | **Total revenues** | **$60,308** | **$53,011** | **13.8%** | [Key Performance Indicators](index=34&type=section&id=Key%20Performance%20Indicators) This section reviews key operational metrics such as Total Written Premium and retention rates, providing insights into business growth and performance - **Total Written Premium increased by 14.4% to $450.3 million in Q2 2025** and by **14.9% to $821.3 million in H1 2025** compared to the prior year periods, driven by increases in both new and renewal business[162](index=162&type=chunk)[165](index=165&type=chunk) - **Consolidated written premium retention decreased to 89% for Q2 2025** from 93% in Q2 2024, attributed to carriers moderating rate increases and opening up for new business after a period of restricted capacity[163](index=163&type=chunk)[164](index=164&type=chunk) Total Written Premium by Offering (in thousands) | Offering | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Total Insurance Services | $389,397 | $706,971 | | TWFG MGA | $60,891 | $114,280 | | **Total written premium** | **$450,288** | **$821,251** | [Non-GAAP Financial Measures](index=35&type=section&id=Non-GAAP%20Financial%20Measures) This section presents and reconciles non-GAAP financial measures, including Organic Revenue Growth, Adjusted Net Income, and Adjusted EBITDA, for performance assessment - The company uses several non-GAAP measures, including Organic Revenue, Adjusted Net Income, and Adjusted EBITDA, to evaluate performance, with **Organic Revenue Growth at 10.6% for Q2 2025 and 12.4% for H1 2025**, reflecting underlying business growth excluding recent large acquisitions[175](index=175&type=chunk)[178](index=178&type=chunk) Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income | $9,000 | $6,918 | $15,853 | $13,547 | | EBITDA | $11,838 | $10,503 | $20,926 | $20,818 | | **Adjusted EBITDA** | **$15,133** | **$10,758** | **$27,321** | **$19,765** | | **Adjusted EBITDA Margin** | **25.1%** | **20.3%** | **23.9%** | **19.9%** | Reconciliation of Net Income to Adjusted Net Income (Revised Methodology, in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income | $9,000 | $6,918 | $15,853 | $13,547 | | **Adjusted Net Income** | **$11,519** | **$9,822** | **$20,746** | **$17,921** | | **Adjusted Net Income Margin** | **19.1%** | **18.5%** | **18.2%** | **18.1%** | [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) This section evaluates the company's cash position, credit facilities, and capital structure, detailing the impact of IPO proceeds on liquidity - As of June 30, 2025, the company had **cash and cash equivalents of $159.8 million**, having received approximately **$192.9 million in net proceeds from its July 2024 IPO**, which was used to repay debt and for general corporate purposes[197](index=197&type=chunk) - The company has a **$50.0 million revolving credit facility** which was fully unutilized as of June 30, 2025, and the outstanding balance on its Term Loan C was $5.0 million[198](index=198&type=chunk) Comparative Cash Flows (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $25,260 | $17,154 | | Net cash used in investing activities | ($46,706) | ($21,223) | | Net cash used in financing activities | ($12,876) | ($5,886) | | **Net change in cash, cash equivalents and restricted cash** | **($34,322)** | **($9,955)** | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risk from insurance premium pricing cycles and interest rate fluctuations. A soft insurance market could negatively affect commissions, while a hard market could be beneficial. Interest rate risk affects both investment income on cash balances and interest expense on variable-rate debt. The company uses derivative instruments to mitigate interest rate risk on its term loans - The company's primary market risks are related to the cyclical nature of P&C insurance premium pricing and interest rate risk on its cash holdings and variable-rate debt[215](index=215&type=chunk)[216](index=216&type=chunk) - As of June 30, 2025, the company had **$171.0 million in cash and cash equivalents**, where a hypothetical **100 basis point change in interest rates would impact interest income by approximately $0.4 million**[218](index=218&type=chunk) - The company had approximately **$5.0 million of variable-rate debt** outstanding under its Term Loan Credit Agreement as of June 30, 2025, with the impact of a hypothetical 10% change in interest rates on this debt not considered material[219](index=219&type=chunk) [Item 4. Controls and Procedures](index=45&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of June 30, 2025. They concluded that these controls were effective at a reasonable assurance level. There were no material changes to the internal control over financial reporting during the quarter - Based on an evaluation as of June 30, 2025, the Principal Executive Officer and Principal Financial Officer concluded that the company's **disclosure controls and procedures were effective** at the reasonable assurance level[222](index=222&type=chunk) - No material changes in the company's internal control over financial reporting occurred during the six months ended June 30, 2025[223](index=223&type=chunk) [Part II - Other Information](index=46&type=section&id=Part%20II%20-%20Other%20Information) This section provides disclosures on legal proceedings, updated risk factors, equity sales, and other material information not covered in Part I [Item 1. Legal Proceedings](index=46&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings that are expected to have a material adverse effect on its business, financial condition, or results of operations - The company is not presently a party to any litigation that it believes would have a material adverse effect on its business, operating results, cash flows, or financial condition[224](index=224&type=chunk) [Item 1A. Risk Factors](index=46&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - There have been no material changes to the risk factors disclosed in the company's Annual Report[225](index=225&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales of equity securities. It details the use of the approximately $192.9 million in net proceeds from its IPO, which included acquiring LLC Units from its holding company, which in turn used the funds to pay IPO expenses and repay $41.0 million of outstanding debt under its Revolving Facility - The company received approximately **$192.9 million in net proceeds from its IPO**, a portion of which was used by its subsidiary, TWFG Holding, to repay in full the outstanding debt of **$41.0 million under the Revolving Facility**[227](index=227&type=chunk) [Item 5. Other Information](index=46&type=section&id=Item%205.%20Other%20Information) The company reported no other material information during the period. Additionally, no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement - No other significant information was reported for the period, and no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement[229](index=229&type=chunk) [Item 6. Exhibits](index=47&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the quarterly report, including the Certificate of Incorporation, By-Laws, and certifications from the CEO and CFO as required by the Sarbanes-Oxley Act - The exhibits filed with the report include the Amended and Restated Certificate of Incorporation, Amended and Restated By-Laws, CEO and CFO Certifications (Sections 302 and 906 of Sarbanes-Oxley Act), and XBRL Interactive Data Files[230](index=230&type=chunk)

Part I. Financial Information [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) For the six months ended June 30, 2025, Churchill Capital Corp IX reported a net income of $3.56 million, primarily driven by $6.18 million in interest income from its Trust Account, offset by $2.62 million in general and administrative expenses [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, the company's total assets were $303.15 million, a slight increase from $299.12 million at year-end 2024, primarily due to interest earned on marketable securities held in the Trust Account Condensed Consolidated Balance Sheet Highlights | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash | $426,052 | $2,412,564 | | Marketable securities and cash held in Trust account | $302,301,272 | $296,122,647 | | **Total Assets** | **$303,150,506** | **$299,124,430** | | Total Liabilities | $10,607,067 | $10,137,500 | | Class A ordinary shares subject to possible redemption | $301,301,272 | $296,122,647 | | **Total Shareholders' Deficit** | **$(8,757,833)** | **$(7,135,717)** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three and six months ended June 30, 2025, the company reported net income of $842,372 and $3,556,509, respectively, primarily from interest earned on the Trust Account Statement of Operations Summary (Unaudited) | Period | General & Administrative Expenses | Interest Income on Trust Account | Net Income | | :--- | :--- | :--- | :--- | | **Three Months Ended June 30, 2025** | $2,338,661 | $3,181,033 | $842,372 | | **Three Months Ended June 30, 2024** | $298,162 | $2,260,889 | $1,962,727 | | **Six Months Ended June 30, 2025** | $2,622,116 | $6,178,625 | $3,556,509 | | **Six Months Ended June 30, 2024** | $322,254 | $2,260,889 | $1,938,635 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash used in operating activities was $1.99 million, primarily due to non-cash interest income and increases in prepaid and accrued expenses Cash Flow Summary for Six Months Ended June 30 | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(1,986,512) | $(1,061,243) | | Net cash used in investing activities | $0 | $(287,500,000) | | Net cash provided by financing activities | $0 | $290,232,495 | | **Net Change in Cash** | **$(1,986,512)** | **$1,671,252** | | **Cash – End of period** | **$426,052** | **$1,671,252** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's SPAC status, its IPO, the establishment of a $287.5 million Trust Account, and the signing of a definitive merger agreement with Plus Automation, Inc - The company is a SPAC incorporated on December 18, 2023, and consummated its Initial Public Offering of **28,750,000 units** on May 6, 2024, raising gross proceeds of **$287.5 million**[23](index=23&type=chunk)[26](index=26&type=chunk) - On June 5, 2025, the company entered into a definitive Merger Agreement with Plus Automation, Inc. ("PlusAI"), with a deadline to complete the initial Business Combination by **August 8, 2026**[36](index=36&type=chunk)[29](index=29&type=chunk) - A mandatory liquidation if a Business Combination is not completed by the deadline raises substantial doubt about the company's ability to continue as a going concern[44](index=44&type=chunk) - The company has significant contingent liabilities, including a **$10.06 million** deferred underwriting fee and a potential **$7 million** advisory fee with Citigroup, payable upon completion of a Business Combination[89](index=89&type=chunk)[90](index=90&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's status as a blank check company, its primary activity of seeking a business combination, and the execution of a merger agreement with PlusAI on June 5, 2025 - The company is a blank check company whose activities since its December 2023 inception have been organizational, preparing for its IPO, and identifying a target for a Business Combination[120](index=120&type=chunk)[128](index=128&type=chunk) - On June 5, 2025, the Company entered into a definitive Merger Agreement with Plus Automation, Inc. (PlusAI), marking a significant step towards its initial Business Combination[124](index=124&type=chunk) Results of Operations Highlights | Period | Net Income | Key Drivers | | :--- | :--- | :--- | | **Q2 2025** | $842,372 | $3.18M interest income offset by $2.34M G&A costs | | **Q2 2024** | $1,962,727 | $2.26M interest income offset by $298k G&A costs | | **H1 2025** | $3,556,509 | $6.18M interest income offset by $2.62M G&A costs | | **H1 2024** | $1,938,635 | $2.26M interest income offset by $322k G&A costs | - The company's mandatory liquidation if a Business Combination is not completed by the deadline (currently **August 8, 2026**) raises substantial doubt about its ability to continue as a going concern[142](index=142&type=chunk) [Quantitative and Qualitative Disclosures Regarding Market Risk](index=26&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20Regarding%20Market%20Risk) The company is a smaller reporting company and is therefore not required to provide the information for this item - As a smaller reporting company, the registrant is not required to provide quantitative and qualitative disclosures about market risk[153](index=153&type=chunk) [Controls and Procedures](index=26&type=section&id=Item%204.%20Controls%20and%20Procedures) Management evaluated the company's disclosure controls and procedures, concluding they were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation, the company's Certifying Officers concluded that disclosure controls and procedures were effective as of the end of the fiscal quarter ended June 30, 2025[156](index=156&type=chunk) - There were no material changes to the company's internal control over financial reporting during the quarter[158](index=158&type=chunk) Part II. Other Information [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that there is no material litigation currently pending or contemplated against the company, its subsidiaries, or its officers and directors - To the knowledge of management, there is no material litigation currently pending or contemplated against the company[161](index=161&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) The company states there have been no material changes to its previously disclosed risk factors, except for new risks specifically related to the pending merger with PlusAI - New risk factors have been introduced related to the pending Initial Business Combination with PlusAI[162](index=162&type=chunk) - Key risks include the potential for the merger not to be consummated, the incurrence of significant expenses regardless of the outcome, and restrictions on pursuing alternative transactions[163](index=163&type=chunk)[164](index=164&type=chunk) - The issuance of Class A common stock upon closing the transaction will cause dilution to existing shareholders[165](index=165&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=29&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no sales of unregistered securities during the quarter ended June 30, 2025, and no material change in the planned use of IPO proceeds - There were no sales of unregistered securities during the quarterly period[169](index=169&type=chunk) - There has been no material change in the planned use of proceeds from the Initial Public Offering[170](index=170&type=chunk) [Defaults Upon Senior Securities](index=30&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - None[171](index=171&type=chunk) [Mine Safety Disclosures](index=30&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[172](index=172&type=chunk) [Other Information](index=30&type=section&id=Item%205.%20Other%20Information) During the quarter, none of the company's directors or officers adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement - No directors or officers adopted or terminated any "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the quarter[173](index=173&type=chunk) [Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the quarterly report, including the Merger Agreement with PlusAI and various officer certifications - Exhibits filed with the report include the Agreement and Plan of Merger with Plus Automation, Inc., related sponsor and support agreements, and officer certifications[176](index=176&type=chunk)