B. Riley Financial(US:RILY) Zhi Tong Cai Jing·2025-12-16 05:42Core Viewpoint - B. Riley Financial Inc. has submitted its overdue Q2 report to the SEC, moving closer to meeting Nasdaq's listing requirements and avoiding delisting, with the stock rising over 40% in after-hours trading following the report submission [2][4]. Group 1: Financial Performance - The Q2 report indicates a turnaround from a loss in the previous year to a profit, with a net income of approximately $137.5 million, including gains from asset sales [2][4]. - The adjusted EBITDA for continuing operations rose significantly from $31.2 million to $38.5 million, while the profit from continuing operations was about $71.7 million compared to a loss of $449.2 million in the same quarter last year [4]. - The company has faced challenges in timely reporting, leading to Nasdaq's threats of delisting, but recent efforts have resulted in a temporary extension for overdue filings [4][5]. Group 2: Operational Challenges - B. Riley is currently dealing with significant investment losses and ongoing civil investigations related to its former key business partner, Brian Kahn, which have compounded its financial difficulties [3][5]. - The bankruptcy of Franchise Group, a critical long-term investment, has resulted in substantial write-downs for B. Riley, impacting its ability to submit timely reports [3][5]. - The company has been forced to delay debt repayments and has taken measures to improve its balance sheet, including asset disposals and reducing leverage [5][6]. Group 3: Market Position and Sentiment - B. Riley's stock has plummeted from approximately $60 at the beginning of 2022 to around $3.7, primarily due to exposure to Franchise Group and subsequent investigations by the SEC [6][7]. - The company has been labeled by some analysts as a potential delisting candidate, reflecting its struggles to maintain its status as a diversified financial services leader [5][6]. - The ongoing challenges have led to a suspension of preferred stock dividends and significant asset disposals, further suppressing market sentiment and valuation [7].