What changed in this filing

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Item 1. Financial Statements

2025-10-31 compared with 2025-08-08 · 100 added, 75 removed, 423 unchanged (29% of the section changed)

2 unchanged sentences

and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended June 30, Six Months Ended June 30,

Condensed Consolidated Statements of Comprehensive Loss

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands, except per share information) 2025 2024 2025 2024

6 unchanged sentences

Gain on sale-leaseback transactions ( 4,279 ) — ( 11,182 ) —

Loss on disposal of assets and other 207 220 330 192

Loss (gain) on disposal of assets and other ( 81 ) ( 85 ) 249 107

Total operating expenses 46,343 56,820 140,573 172,518

Operating income 14,683 7,934 23,487 11,134

Operating income (loss) ( 6,106 ) 8,916 17,381 20,050

Other expense (income)

5 unchanged sentences

Income tax expense 10,074 4,611 20,060 10,641

Net income (loss) $ 7,700 $ ( 6,696 ) $ 8,822 $ ( 17,011 )

Net loss $ ( 20,554 ) $ ( 14,815 ) $ ( 11,732 ) $ ( 31,826 )

Weighted average shares outstanding

1 unchanged sentence

Diluted 11,682 12,330 12,110 12,287

Earnings (loss) per share

Loss per share

Basic $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 )

1 unchanged sentence

Other comprehensive income (loss), net of tax of $ 0 :

Net income (loss) $ 7,700 $ ( 6,696 ) $ 8,822 $ ( 17,011 )

Net loss $ ( 20,554 ) $ ( 14,815 ) $ ( 11,732 ) $ ( 31,826 )

Change in foreign currency translation ( 4,308 ) 14,254 5,105 14,071

Gain (loss) on pension liability ( 4 ) 25 107 5

Comprehensive income (loss) $ 16,704 $ ( 6,080 ) $ 18,346 $ ( 17,214 )

Comprehensive loss $ ( 24,866 ) $ ( 536 ) $ ( 6,520 ) $ ( 17,750 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

Condensed Consolidated Balance Sheets

(in thousands, except share information) June 30, 2025 December 31, 2024

(in thousands, except share information) September 30, 2025 December 31, 2024

Current assets

41 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands) 2025 2024

Cash flows from operating activities

Net income (loss) $ 8,822 $ ( 17,011 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Net loss $ ( 11,732 ) $ ( 31,826 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation expense 10,547 12,660

Amortization of intangible assets 15,367 28,896

Impairment of property and equipment and other assets 4,406 —

Inventory write-down 17,407 3,313

Stock-based compensation expense 6,371 5,180

Loss on extinguishment of debt — 463

Deferred income taxes ( 3,264 ) ( 3,180 )

Gain on sale-leaseback transactions ( 11,182 ) —

Loss on extinguishment of debt — 2,302

Other 1,485 5,572

10 unchanged sentences

Proceeds from sale of property and equipment 163 236

Payments related to business acquisition, net of cash acquired — ( 150,086 )

Proceeds from sale-leaseback transactions 14,574 —

Payments related to business acquisition, net of cash acquired — ( 150,408 )

Net cash provided by (used in) investing activities 10,284 ( 155,907 )

4 unchanged sentences

Proceeds from issuance of Seller Term Loan — 59,677

Payment of Seller Term Loan — ( 1,250 )

Payment of capital lease obligations ( 1,413 ) ( 887 )

7 unchanged sentences

Cash, cash equivalents and restricted cash at end of period $ 31,693 $ 33,313

Forum Energy Technologies, Inc.

and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Continued)

Nine Months Ended September 30,

(in thousands) 2025 2024

Supplemental cash flow disclosures

11 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(in thousands) Common stock Additional paid-in capital Treasury stock Retained

16 unchanged sentences

Balance at June 30, 2025 $ 132 $ 1,422,138 $ ( 148,352 ) $ ( 825,975 ) $ ( 113,723 ) $ 334,220

Stock-based compensation expense — 2,781 — — — 2,781

Treasury stock — — ( 14,825 ) — — ( 14,825 )

Currency translation adjustment — — — — ( 4,308 ) ( 4,308 )

Change in pension liability — — — — ( 4 ) ( 4 )

Net loss — — — ( 20,554 ) — ( 20,554 )

Balance at September 30, 2025 $ 132 $ 1,424,919 $ ( 163,177 ) $ ( 846,529 ) $ ( 118,035 ) $ 297,310

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(in thousands) Common stock Additional paid-in capital Treasury stock Retained

16 unchanged sentences

Balance at June 30, 2024 $ 130 $ 1,415,838 $ ( 142,057 ) $ ( 716,482 ) $ ( 115,439 ) $ 441,990

Stock-based compensation expense — 2,076 — — — 2,076

Currency translation adjustment — — — — 14,254 14,254

Change in pension liability — — — — 25 25

Net loss — — — ( 14,815 ) — ( 14,815 )

Balance at September 30, 2024 $ 130 $ 1,417,914 $ ( 142,057 ) $ ( 731,297 ) $ ( 101,160 ) $ 443,530

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Continued)

Notes to Condensed Consolidated Financial Statements

Organization and Basis of Presentation

6 unchanged sentences

In management's opinion, all adjustments, consisting of normal recurring adjustments, necessary for the fair statement of the Company’s financial position, results of operations and cash flows have been included.

Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025 or any other interim period.

Operating results for the three and nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025 or any other interim period.

These interim financial statements are unaudited and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting.

29 unchanged sentences

Such contract liabilities typically result from billings in excess of costs incurred on construction contracts and advance payments received on product sales.

The following table reflects the changes in our contract assets and contract liabilities balances for the six months ended June 30, 2025 (in thousands):

June 30, 2025 December 31, 2024 Increase

The following table reflects the changes in our contract assets and contract liabilities balances for the nine months ended September 30, 2025 (in thousands):

September 30, 2025 December 31, 2024 Increase

Accrued revenue $ 21 $ 752

4 unchanged sentences

Contract liabilities $ 24,979 $ 13,100 $ 11,879 91 %

During the six months ended June 30, 2025, our contract assets increased by $ 2.2 million and our contract liabilities increased $ 10.9 million primarily due to the timing of milestone billings for projects in our Subsea product line.

During the six months ended June 30, 2025, we recognized $ 8.5 million of revenue that was included in the contract liabilities balance at the beginning of the period.

During the nine months ended September 30, 2025, our contract assets increased by $ 4.0 million and our contract liabilities increased $ 11.9 million primarily due to the timing of milestone billings for projects in our Subsea product line.

During the nine months ended September 30, 2025, we recognized $ 10.7 million of revenue that was included in the contract liabilities balance at the beginning of the period.

Substantially all of our contracts are less than one year in duration.

As such, we have elected to apply the practical expedient which allows an entity to exclude disclosures about its remaining performance obligations if such obligation is part of a contract that has an original expected duration of one year or less.

The Company's significant components of inventory at June 30, 2025 and December 31, 2024 were as follows (in thousands):

June 30, 2025 December 31, 2024

The Company's significant components of inventory at September 30, 2025 and December 31, 2024 were as follows (in thousands):

September 30, 2025 December 31, 2024

Raw materials and parts $ 94,361 $ 99,185

4 unchanged sentences

Inventories, net $ 248,255 $ 265,487

During the nine months ended September 30, 2025, we recognized $ 16.5 million of inventory write-downs related to the Company’s strategic decision to consolidate facilities and discontinue certain products.

Forum Energy Technologies, Inc.

2 unchanged sentences

Goodwill and Intangible Assets

The changes in the carrying amount of goodwill from December 31, 2024 to June 30, 2025, were as follows (in thousands):

The changes in the carrying amount of goodwill from December 31, 2024 to September 30, 2025, were as follows (in thousands):

Artificial Lift and Downhole

2 unchanged sentences

local currency translation 2,126

Goodwill, June 30, 2025 $ 65,222

Goodwill, September 30, 2025 $ 63,779

Goodwill is not amortized and is tested for impairment at least annually or when events and circumstances indicate that fair value may be below its carrying value.

Intangible Assets

Intangible assets consisted of the following as of June 30, 2025 and December 31, 2024, respectively (in thousands):

June 30, 2025

Intangible assets consisted of the following as of September 30, 2025 and December 31, 2024, respectively (in thousands):

September 30, 2025

Gross Carrying Amount Accumulated Amortization Net Intangibles Amortization Period (In Years)

13 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Continued)

Debt as of June 30, 2025 and December 31, 2024 consisted of the following (in thousands):

June 30, 2025 December 31, 2024

Debt as of September 30, 2025 and December 31, 2024 consisted of the following (in thousands):

September 30, 2025 December 31, 2024

2029 Bonds $ 100,000 $ 100,000

16 unchanged sentences

The 2029 Bonds are also subject to negative covenants as set forth in the Bond Terms.

As of June 30, 2025, the Company was in compliance with all of its 2029 Bonds financial covenants.

As of September 30, 2025, the Company was in compliance with all of its 2029 Bonds financial covenants.

Upon the occurrence of certain change of control events, as specified in the Bond Terms, each holder of the 2029 Bonds will have the right to require that the Company repurchase all or some of such holder’s 2029 Bonds in cash at a purchase price equal to 101 % of the aggregate principal amount thereof.

14 unchanged sentences

Our borrowing capacity under the Credit Facility could be reduced or eliminated, depending on future fluctuations in our receivables and inventory.

As of June 30, 2025, our total borrowing base was $ 171.8 million, of which $ 62.4 million amount was drawn and $ 16.3 million was used as security for outstanding letters of credit, resulting in remaining availability of $ 93.1 million.

As of September 30, 2025, our total borrowing base was $ 160.0 million, of which $ 42.8 million amount was drawn and $ 31.5 million was used as security for outstanding letters of credit, resulting in remaining availability of $ 85.7 million.

Borrowings under the U.S.

3 unchanged sentences

The Canadian Line base rate is determined by reference to the greater of (i) the one-month CORRA plus 1.00 % per annum and (ii) the prime rate for Canadian dollar commercial loans made in Canada as reported by Thomson Reuters, subject to a floor of 0.00 %.

The weighted average interest rate under the Credit Facility was approximately 7.42 % and 8.45 % for the six months ended June 30, 2025 and 2024, respectively.

The weighted average interest rate under the Credit Facility was approximately 7.36 % and 8.37 % for the nine months ended September 30, 2025 and 2024, respectively.

The Credit Facility also provides for a commitment fee in the amount of (a) 0.375 % on the unused portion of revolving commitments if average usage of the Credit Facility is greater than 50 % and (b) 0.500 % on the unused portion of revolving commitments if average usage of the Credit Facility is less than or equal to 50 %.

13 unchanged sentences

and the occurrence of a Change of Control (as defined in the Credit Facility).

As of June 30, 2025, the Company was in compliance with all of its Credit Facility financial covenants.

As of September 30, 2025, the Company was in compliance with all of its Credit Facility financial covenants.

Forum Energy Technologies, Inc.

4 unchanged sentences

We execute letters of credit in the normal course of business to secure the delivery of product from specific vendors and also to guarantee our fulfillment of performance obligations relating to certain large contracts.

The Company had $ 16.3 million and $ 17.8 million in total outstanding letters of credit as of June 30, 2025 and December 31, 2024, respectively.

The Company had $ 31.5 million and $ 17.8 million in total outstanding letters of credit as of September 30, 2025 and December 31, 2024, respectively.

For interim periods, our income tax expense or benefit is computed based on our estimated annual effective tax rate and any discrete items that impact the interim periods.

For the three and six months ended June 30, 2025, the Company recorded a tax expense of $ 6.2 million and $ 10.0 million, respectively.

For the three and six months ended June 30, 2024, the Company recorded tax expense of $ 2.5 million and $ 6.0 million, respectively.

For the three and nine months ended September 30, 2025, the Company recorded a tax expense of $ 10.1 million and $ 20.1 million, respectively.

For the three and nine months ended September 30, 2024, the Company recorded tax expense of $ 4.6 million and $ 10.6 million, respectively.

The estimated annual effective tax rates for all periods were impacted by losses in jurisdictions where the recording of a tax benefit is not available.

Furthermore, the tax expense or benefit recorded can vary from period to period depending on the Company’s relative mix of earnings and losses by jurisdiction.

Finally, the Company believes that it is reasonably possible that a decrease of approximately $ 1.8 million of noncurrent unrecognized tax benefits may occur by the end of 2025 as a result of a lapse of the statute of limitations.

The Organization for Economic Co-operation and Development introduced Base Erosion and Profit Shifting (“BEPS”) Pillar 2 rules that impose a global minimum tax rate of 15%.

5 unchanged sentences

In making such a determination, we consider all available positive and negative evidence, including, but not limited to, our recent history of pretax losses over the prior three year period, the goodwill and intangible asset impairments for various reporting units, the future reversals of existing taxable temporary differences, the projected future taxable income or loss and tax-planning.

As of June 30, 2025, we do not anticipate being able to fully utilize all of the losses prior to their expiration in the following jurisdictions:

the U.S., the U.K., Singapore and China.

As a result, we have certain valuation allowances against our deferred tax assets as of June 30, 2025.

During the three months ended September 30, 2025, we recorded a valuation allowance reserve of $ 5.2 million on our deferred tax assets relating to certain net operating loss carryforwards that we will more than likely not be able to realize prior to their expiration.

As of September 30, 2025, we do not anticipate being able to fully utilize all of the losses prior to their expiration in the following jurisdictions:

the U.S., United Kingdom ("U.K."), Singapore and China.

As a result, we have certain valuation allowances against our deferred tax assets as of September 30, 2025.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act ("OBBBA").

2 unchanged sentences

Fair Value Measurements

The Company had $ 62.4 million and $ 100.0 million borrowings outstanding under the Credit Facility and 2029 Bonds as of June 30, 2025, respectively.

The Company had $ 42.8 million and $ 100.0 million borrowings outstanding under the Credit Facility and 2029 Bonds as of September 30, 2025, respectively.

The Credit Facility incurs interest at a variable interest rate and therefore, the carrying amount approximates fair value.

1 unchanged sentence

The fair value of our 2029 Bonds is estimated using Level 2 inputs in the fair value hierarchy and is based on quoted prices for those or similar instruments.

At June 30, 2025, the fair value and the carrying value of our 2029 Bonds approximated $ 102.0 million and $ 94.1 million, respectively.

At September 30, 2025, the fair value and the carrying value of our 2029 Bonds approximated $ 102.0 million and $ 94.4 million, respectively.

At December 31, 2024, the fair value and the carrying value of our 2029 Bonds approximated $ 99.5 million and $ 94.6 million, respectively.

There were no other significant outstanding financial instruments as of June 30, 2025 and December 31, 2024 that required measuring the amounts at fair value on a recurring basis.

We did not change our valuation techniques associated with recurring fair value measurements from prior periods, and there were no transfers between levels of the fair value hierarchy during the six months ended June 30, 2025.

There were no other significant outstanding financial instruments as of September 30, 2025 and December 31, 2024 that required measuring the amounts at fair value on a recurring basis.

Forum Energy Technologies, Inc.

14 unchanged sentences

Summary financial data by segment follows (in thousands):

Three Months Ended June 30, 2025 Six Months Ended June 30, 2025

Three Months Ended September 30, 2025 Nine Months Ended September 30, 2025

Drilling and Completions Artificial Lift and Downhole Total Drilling and Completions Artificial Lift and Downhole Total

6 unchanged sentences

Selling, general and administrative expenses 23,040 18,970 42,010 66,631 58,758 125,389

Segment operating income $ 7,271 $ 10,391 $ 17,662 $ 16,650 $ 17,688 $ 34,338

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024

Segment operating income (loss) $ ( 13,551 ) $ 11,778 $ ( 1,773 ) $ 3,099 $ 29,466 $ 32,565

Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024

Drilling and Completions Artificial Lift and Downhole Total Drilling and Completions Artificial Lift and Downhole Total

11 unchanged sentences

A reconciliation of segment operating income to income (loss) before income taxes is as follows (in thousands):

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 2025 2024

4 unchanged sentences

Gain on sale-leaseback transactions ( 4,279 ) — ( 11,182 ) —

Loss on disposal of assets and other 207 220 330 192

Loss (gain) on disposal of assets and other ( 81 ) ( 85 ) 249 107

Interest expense 4,365 7,650 14,054 25,069

1 unchanged sentence

Loss on extinguishment of debt — 1,839 — 2,302

Income (loss) before income taxes $ 13,919 $ ( 4,194 ) $ 18,808 $ ( 10,981 )

Loss before income taxes $ ( 10,480 ) $ ( 10,204 ) $ 8,328 $ ( 21,185 )

A summary of consolidated assets by reportable segment is as follows (in thousands):

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Drilling and Completions $ 402,445 $ 418,583

3 unchanged sentences

Corporate assets primarily include cash, certain prepaid assets and deferred loan costs.

Forum Energy Technologies, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Continued)

The following table presents our revenues disaggregated by product line (in thousands):

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 2025 2024

8 unchanged sentences

Total revenue $ 196,231 $ 207,806 $ 589,274 $ 615,407

Forum Energy Technologies, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Continued)

The following table presents our revenues disaggregated by geography (in thousands):

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 2025 2024

9 unchanged sentences

Management has reviewed such pending judicial and legal proceedings, the reasonably anticipated costs and expenses in connection with such proceedings, and the availability and limits of insurance coverage, and has established reserves that are believed to be appropriate in light of those outcomes that are believed to be probable and can be estimated.

The reserves accrued at June 30, 2025 and December 31, 2024, respectively, are immaterial.

The reserves accrued at September 30, 2025 and December 31, 2024, respectively, are immaterial.

In the opinion of management, the Company’s ultimate liability, if any, with respect to these actions is not expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows.

For further disclosure regarding certain litigation matters, refer to Note 12 of the notes to the consolidated financial statements included in Item 8 of the Company’s 2024 Annual Report on Form 10-K filed with the SEC on March 3, 2025.

Forum Energy Technologies, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Continued)

Earnings (Loss) Per Share

The calculation of basic and diluted earnings (loss) per share for each period presented was as follows (dollars and shares in thousands, except per share amounts):

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2025 2024 2025 2024

Net income (loss) $ 7,700 $ ( 6,696 ) $ 8,822 $ ( 17,011 )

Net loss $ ( 20,554 ) $ ( 14,815 ) $ ( 11,732 ) $ ( 31,826 )

Weighted average shares outstanding - basic 11,682 12,330 12,110 12,287

1 unchanged sentence

Weighted average shares outstanding - diluted 11,682 12,330 12,110 12,287

Earnings (loss) per share

Loss per share

Basic $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 )

Diluted $ ( 1.76 ) $ ( 1.20 ) $ ( 0.97 ) $ ( 2.59 )

Forum Energy Technologies, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Continued)

For the three and six months ended June 30, 2025, the diluted earnings per share excludes approximately 28 thousand and 19 thousand shares, respectively, because they were anti-dilutive.

For the three and six months ended June 30, 2024, we excluded all potentially dilutive stock options and restricted stock in calculating diluted earnings per share as the effect was anti-dilutive due to net losses incurred for these periods.

For the three and nine months ended September 30, 2025, we excluded approximately 8 thousand and 15 thousand shares, respectively, and for the three and nine months ended September 30, 2024, we excluded approximately 153 thousand and 94 thousand shares, respectively, of potentially dilutive stock options and restricted stock in calculating diluted earnings per share as the effect was anti-dilutive due to net losses incurred for these periods.

Diluted earnings per share was calculated using treasury stock method for the stock options and restricted stock.

1 unchanged sentence

Restricted Stock and Time-Based Restricted Stock Units

During the six months ended June 30, 2025, the Company granted 190,392 time-based restricted stock units to employees that vest after three years .

Also, during the six months ended June 30, 2025, the Company granted 41,938 time-based restricted stock and 8,557 time-based restricted stock units to non-employee members of the Board of Directors that vest after one year .

During the nine months ended September 30, 2025, the Company granted 190,392 time-based restricted stock units to employees that vest ratably over three years .

Also, during the nine months ended September 30, 2025, the Company granted 41,938 time-based restricted stock and 8,557 time-based restricted stock units to non-employee members of the Board of Directors that vest after one year .

Performance Share Awards

During the six months ended June 30, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's total shareholder return compared to the total shareholder return of a group of peer companies over three different performance periods.

During the nine months ended September 30, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's total shareholder return compared to the total shareholder return of a group of peer companies over three different performance periods.

The performance periods run from January 1, 2025 through December 31, 2025, January 1, 2025 through December 31, 2026 and January 1, 2025 through December 31, 2027, and one-third of each award is allocated to each performance period.

The performance restricted stock units may settle for between 0 % and 200 % of the target units granted.

During the six months ended June 30, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's free cash flow over three different performance periods.

During the nine months ended September 30, 2025, the Company granted 95,197 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's free cash flow over three different performance periods.

The performance restricted stock units may settle for between 0 % and 200 % of the target units granted.

During the six months ended June 30, 2025, the Company granted 114,000 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's minimum stock price threshold of $ 21.91 per share, for 20 consecutive trading days during the period commencing on grant date of March 5, 2025 and ending on the third anniversary thereof.

Forum Energy Technologies, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Continued)

During the nine months ended September 30, 2025, the Company granted 114,000 performance restricted stock units (assuming target performance) to employees that vest based upon the Company's minimum stock price threshold of $ 21.91 per share, for 20 consecutive trading days during the period commencing on grant date of March 5, 2025 and ending on the third anniversary thereof.

Related Party Transactions

6 unchanged sentences

The related assets were removed from property and equipment and the appropriate operating lease assets and liabilities of approximately $ 7.6 million were recorded in the consolidated balance sheets.

In August 2025, the Company sold and leased back land and buildings with a net book value of approximately $ 2.3 million and received net proceeds of $ 6.5 million.

The initial annual rent for the assets is $ 0.6 million with an initial term of 18 years, subject to annual increases.

The transactions met the requirements of sale-leaseback accounting.

The related assets were removed from property and equipment and the appropriate operating lease assets and liabilities of approximately $ 7.2 million were recorded in the consolidated balance sheets.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements