FutureFuel Corp. 10-Q

Item 1. Financial Statements. FutureFuel Corp. Consolidated Balance Sheets (Dollars in thousands, except per share amounts) (Unaudited) As Adjusted (Note 1) June 30, 2026 December 31, 2025 Assets Cash and cash equivalents $ 34,366 $ 51,316 Accounts receivable, net of allowances for expected credit losses of $ 36 and $ 28 , respectively 20,104 9,405 Inventory, net 40,692 29,334 Income tax receivable 77 88 Prepaid expenses 2,101 4,077 Other current assets 18,930 14,383 Total current assets 116,270 108,603 Property, plant and equipment, net 93,462 86,797 Other assets 5,309 4,922 Total noncurrent assets 98,771 91,719 Total Assets $ 215,041 $ 200,322 Liabilities and Stockholders’ Equity Accounts payable $ 23,351 $ 10,633 Accounts payable – related parties 41 40 Deferred revenue – current 661 1,519 Dividends payable 574 2,761 Accrued expenses and other current liabilities 3,994 2,783 Total current liabilities 28,621 17,736 Deferred revenue – noncurrent 11,978 11,644 Dividends payable - noncurrent 206 196 Noncurrent deferred income taxes 1,118 1,055 Other noncurrent liabilities 20,036 7,048 Total noncurrent liabilities 33,338 19,943 Total liabilities 61,959 37,679 Commitments and contingencies Preferred stock, $ 0.0001 par value, 5,000,000 shares authorized, none issued and outstanding - - Common stock, $ 0.0001 par value, 75,000,000 shares authorized, 43,863,318 and 43,863,507 issued and outstanding as of June 30, 2026 and December 31, 2025, respectively 4 4 Additional paid in capital 203,438 203,771 Retained earnings (accumulated deficit) ( 50,360 ) ( 41,132 ) Total stockholders’ equity 153,082 162,643 Total Liabilities and Stockholders’ Equity $ 215,041 $ 200,322 The accompanying notes are an integral part of these consolidated financial statements. 1 FutureFuel Corp. Consolidated Statements of Operations and Net Income (Loss) (Dollars in thousands, except per share amounts) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, As Adjusted (Note 1) As Adjusted (Note 1) 2026 2025 2026 2025 Revenue $ 78,726 $ 35,673 $ 110,627 $ 53,211 Revenue – related parties - - 51 Cost of goods sold 62,620 47,387 109,632 79,572 Cost of goods sold – related parties 3 1 3 3 Distribution 1,080 641 1,878 1,131 Distribution – related parties - 37 - 86 Gross profit (loss) 15,023 ( 12,393 ) ( 835 ) ( 27,581 ) Selling, general, and administrative expenses Compensation expense 1,391 1,191 2,660 3,131 Other expense, net 1,562 868 4,307 1,651 Related party expense 127 169 258 330 Research and development expenses 692 933 1,532 2,324 Total operating expenses 3,772 3,161 8,757 7,436 Income (loss) from operations 11,251 ( 15,554 ) ( 9,592 ) ( 35,017 ) Interest income 209 1,068 507 2,305 Interest expense ( 30 ) ( 26 ) ( 59 ) ( 62 ) Other income 9 505 9 505 Other income, net 188 1,547 457 2,748 Income (loss) before taxes 11,439 ( 14,007 ) ( 9,135 ) ( 32,269 ) Income tax provision 69 183 77 15 Net income (loss) $ 11,370 $ ( 14,190 ) $ ( 9,212 ) $ ( 32,284 ) Earnings (loss) per common share Basic $ 0.25 $ ( 0.32 ) $ ( 0.21 ) $ ( 0.74 ) Diluted $ 0.25 $ ( 0.32 ) $ ( 0.21 ) $ ( 0.74 ) Weighted average shares outstanding Basic 44,029,003 43,803,243 44,027,914 43,803,243 Diluted 44,039,829 43,803,243 44,027,914 43,803,243 The accompanying notes are an integral part of these consolidated financial statements. 2 FutureFuel Corp. Consolidated Statements of Stockholders’ Equity (Dollars in thousands) (Unaudited) For the Six Months Ended June 30, 2026 Retained Additional Earnings Total Common Stock paid in (Accumulated Stockholders’ Shares Amount Capital Deficit) Equity Balance - December 31, 2025 43,863,507 $ 4 $ 203,771 $ ( 41,132 ) $ 162,643 Cash dividends declared, $ 0.01 per share - - ( 439 ) - ( 439 ) Stock based compensation - - 313 ( 8 ) 305 Net loss - - - ( 20,582 ) ( 20,582 ) Balance - March 31, 2026 43,863,507 $ 4 $ 203,645 $ ( 61,722 ) $ 141,927 Cash dividends declared, $ 0.01 per share - $ - ( 439 ) - ( 439 ) Stock based compensation ( 189 ) - 232 ( 8 ) 224 Net income - - - 11,370 11,370 Balance - June 30, 2026 43,863,318 $ 4 $ 203,438 $ ( 50,360 ) $ 153,082 For the Six Months Ended June 30, 2025 (As Adjusted (Note 1)) Retained Additional Earnings Total Common Stock paid in (Accumulated Stockholders’ Shares Amount Capital Deficit) Equity Balance - December 31, 2024 43,803,243 $ 4 $ 205,434 $ 383 $ 205,821 Change in accounting principle - - - 6,252 6,252 Balance - December 31, 2024, as adjusted 43,803,243 4 205,434 6,635 212,073 Stock based compensation - - 227 ( 1 ) 226 Net loss - - - ( 18,094 ) ( 18,094 ) Balance - March 31, 2025 43,803,243 $ 4 $ 205,661 $ ( 11,460 ) $ 194,205 Stock based compensation - - 237 - 237 Net loss - - - ( 14,190 ) ( 14,190 ) Balance - June 30, 2025 43,803,243 $ 4 $ 205,898 $ ( 25,650 ) $ 180,252 The accompanying notes are an integral part of these consolidated financial statements. 3 FutureFuel Corp. Consolidated Statements of Cash Flows (Dollars in thousands) (Unaudited) Six Months Ended June 30, As Adjusted (Note 1) 2026 2025 Cash flows from operating activities Net loss $ ( 9,212 ) $ ( 32,284 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 5,331 4,739 Amortization of deferred financing costs 38 44 Provision for deferred income taxes 63 2 Change in fair value of derivative instruments ( 735 ) ( 281 ) Stock based compensation 529 462 Gain on disposal of property and equipment - ( 34 ) Change in allowance for credit losses 9 15 Change in inventory reserve 501 524 Noncash interest expense 18 18 Changes in operating assets and liabilities: Accounts receivable ( 10,708 ) 10,935 Inventory ( 11,859 ) 14,750 Income tax receivable 11 3 Prepaid expenses 1,976 1,882 Prepaid expenses – related parties - ( 12 ) Other assets ( 4,639 ) ( 2,941 ) Accounts payable 14,100 ( 2,367 ) Accounts payable – related parties 1 ( 96 ) Dividends payable 16 - Accrued expenses and other current liabilities 1,150 3,579 Deferred revenue ( 524 ) 3,142 Other noncurrent liabilities 12,707 ( 2,263 ) Net cash used in operating activities ( 1,227 ) ( 183 ) Cash flows from investing activities Collateralization of derivative instruments 726 859 Proceeds from the sale of property and equipment - 34 Capital expenditures ( 13,378 ) ( 9,478 ) Net cash used in investing activities ( 12,652 ) ( 8,585 ) Cash flows from financing activities Payment of dividends ( 3,071 ) ( 5,256 ) Deferred financing costs - ( 365 ) Net cash used in financing activities ( 3,071 ) ( 5,621 ) Net change in cash and cash equivalents ( 16,950 ) ( 14,389 ) Cash and cash equivalents at beginning of period 51,316 109,541 Cash and cash equivalents at end of period $ 34,366 $ 95,152 Cash paid for income taxes $ 3 $ 10 Noncash investing and financing activities ROU assets obtained in exchange for new operating lease liabilities $ 324 $ - Change in noncash capital expenditures $ ( 1,382 ) $ 1,333 The accompanying notes are an integral part of these consolidated financial statements. 4 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 1 ) SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared by FutureFuel Corp. (“FutureFuel” or “the Company”) in accordance and consistent with the accounting policies stated in the Company's 2025 Annual Report on Form 10 -K, inclusive of the audited consolidated financial statements, and should be read in conjunction with these consolidated financial statements. Certain reclassifications were made to prior year amounts to conform to the 2026 presentation. In the opinion of FutureFuel, all normal recurring adjustments necessary for a fair presentation have been included in the unaudited consolidated financial statements. The unaudited consolidated financial statements have been prepared in compliance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with instructions to Form 10 -Q adopted by the Securities and Exchange Commission (“SEC”). Accordingly, the unaudited consolidated financial statements do not include all the information and footnotes required by GAAP for complete financial statements and do include amounts that are based upon management estimates and judgments. Future actual results could differ from such current estimates. The unaudited consolidated financial statements include assets, liabilities, revenues, and expenses of FutureFuel and its direct and indirect wholly owned subsidiaries; namely, FutureFuel Chemical Company; FutureFuel Warehouse Company, L.L.C.; and Legacy Regional Transport, L.L.C. Intercompany transactions and balances have been eliminated in consolidation. Some of the Company's manufacturing equipment requires periodic, planned shutdowns of significant parts of our facility in order to perform necessary inspections, cleanings, and maintenance activities, referred to as turnarounds. The cost of turnarounds incurred for routine repairs and maintenance or unplanned outages at our facility are expensed as incurred. A component of Other expense, net, in the consolidated statement of operations and net income (loss) for the three and six months ended June 30, 2026, includes $ 260 and $ 1,617 , respectively, of incremental, non-recurring costs associated with the Winter Storm Fern freeze event, which caused a 30 -day shutdown for the majority of our manufacturing plant, and $ 281 and $ 281 , respectively, of incremental, non-recurring costs associated with a fire in our tank farm area that was promptly and safely contained. These expenditures primarily consisted of idle labor and emergency repairs and are abnormal to the Company's standard operations. 5 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) Effective January 1, 2026, the Company elected to change its method of accounting for certain inventory from last in, first out ("LIFO") to weighted average cost. The Company believes the change to weighted average cost is preferable because it provides a better matching of costs and revenues, conforms the Company's inventory to a single method of accounting and improves comparability with the Company's peers. Comparative financial statements for prior years have been adjusted to apply the new method retrospectively. The tables below illustrate the impacts for the prior three - and six -month periods ended June 30, 2025, had the Company reported under the weighted average cost basis of accounting: June 30, 2025 As Originally Condensed Balance Sheet Reported under LIFO As Adjusted Effect of Change Inventory, net $ 9,620 $ 11,742 $ 2,122 Total current assets 128,751 130,873 2,122 Total Assets 218,212 220,334 2,122 Noncurrent deferred income taxes 801 895 94 Total noncurrent liabilities 9,049 9,143 94 Total liabilities 39,988 40,082 94 Retained earnings (accumulated deficit) ( 27,678 ) ( 25,650 ) 2,028 Total stockholders' equity 178,224 180,252 2,028 Total Liabilities and Stockholders' Equity 218,212 220,334 2,122 Three months ended June 30, 2025 As Originally Condensed Statement of Operations and Net Loss Reported under LIFO As Adjusted Effect of Change Revenue $ 35,673 $ 35,673 $ - Cost of goods sold 43,761 47,387 3,626 Gross loss ( 8,767 ) ( 12,393 ) ( 3,626 ) Loss from operations ( 11,928 ) ( 15,554 ) ( 3,626 ) Loss before taxes ( 10,381 ) ( 14,007 ) ( 3,626 ) Income tax provision 35 183 148 Net loss ( 10,416 ) ( 14,190 ) ( 3,774 ) Loss per common share Basic $ ( 0.24 ) $ ( 0.32 ) $ ( 0.09 ) Diluted $ ( 0.24 ) $ ( 0.32 ) $ ( 0.09 ) 6 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) Six months ended June 30, 2025 As Originally Condensed Statement of Operations and Net Loss Reported under LIFO As Adjusted Effect of Change Revenue $ 53,211 $ 53,211 $ - Cost of goods sold 75,321 79,572 4,251 Gross loss ( 23,330 ) ( 27,581 ) ( 4,251 ) Loss from operations ( 30,766 ) ( 35,017 ) ( 4,251 ) Loss before taxes ( 28,018 ) ( 32,269 ) ( 4,251 ) Income tax provision 41 15 ( 26 ) Net loss ( 28,059 ) ( 32,284 ) ( 4,225 ) Loss per common share Basic $ ( 0.64 ) $ ( 0.74 ) $ ( 0.10 ) Diluted $ ( 0.64 ) $ ( 0.74 ) $ ( 0.10 ) Six months ended June 30, 2025 As Originally Condensed Statements of Cash Flows Reported under LIFO As Adjusted Effect of Change Net loss $ ( 28,059 ) $ ( 32,284 ) $ ( 4,225 ) Provision (benefit) for deferred income taxes 28 2 ( 26 ) Inventory 10,499 14,750 4,251 Net Cash flows from Operating Activities ( 183 ) ( 183 ) - December 31, 2025 As Originally Condensed Balance Sheet Reported under LIFO As Adjusted Effect of Change Inventory, net $ 21,254 $ 29,334 $ 8,080 Total current assets 100,523 108,603 8,080 Total Assets 192,242 200,322 8,080 Noncurrent deferred income taxes 910 1,055 145 Total noncurrent liabilities 19,798 19,943 145 Total liabilities 37,534 37,679 145 Retained earnings (accumulated deficit) ( 49,067 ) ( 41,132 ) 7,935 Total stockholder's equity 154,708 162,643 7,935 Total Liabilities and Stockholder's Equity 192,242 200,322 8,080 7 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) The following tables summarize the effect of the change on the Company's financial condition as of, and results of operations for the three and six months ended, June 30, 2026. June 30, 2026 Condensed Balance Sheet As Computed under Weighted Average Cost As Computed under LIFO Effect of Change Inventory, net $ 40,692 $ 38,730 $ ( 1,962 ) Total current assets 116,270 114,308 ( 1,962 ) Total Assets 215,041 213,079 ( 1,962 ) Income tax payable - - - Total current liabilities 28,621 28,621 - Noncurrent deferred income taxes 1,118 498 ( 620 ) Total noncurrent liabilities 33,338 32,718 ( 620 ) Total liabilities 61,959 61,339 ( 620 ) Retained earnings (accumulated deficit) ( 50,360 ) ( 51,702 ) ( 1,342 ) Total stockholders' equity 153,082 151,740 ( 1,342 ) Total Liabilities and Stockholders' Equity 215,041 213,079 ( 1,962 ) Three months ended June 30, 2026 Condensed Statement of Operations and Net Income (Loss) As Computed under Weighted Average Cost As Computed under LIFO Effect of Change Revenue $ 78,726 $ 78,726 $ - Cost of goods sold 62,623 64,897 2,274 Gross profit 15,023 12,749 ( 2,274 ) Income from operations 11,251 8,977 ( 2,274 ) Income before taxes 11,439 9,165 ( 2,274 ) Income tax provision (benefit) 69 ( 631 ) ( 700 ) Net income 11,370 9,796 ( 1,574 ) Earnings per common share Basic $ 0.25 $ 0.21 $ ( 0.04 ) Diluted $ 0.25 $ 0.21 $ ( 0.04 ) 8 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) Six months ended June 30, 2026 Condensed Statement of Operations and Net Loss As Computed under Weighted Average Cost As Computed under LIFO Effect of Change Revenue $ 110,678 $ 110,678 $ - Cost of goods sold 109,635 111,597 1,962 Gross loss ( 835 ) ( 2,797 ) ( 1,962 ) Loss from operations ( 9,592 ) ( 11,554 ) ( 1,962 ) Loss before taxes ( 9,135 ) ( 11,097 ) ( 1,962 ) Income tax provision (benefit) 77 ( 543 ) ( 620 ) Net loss ( 9,212 ) ( 10,554 ) ( 1,342 ) Loss per common share Basic $ ( 0.21 ) $ ( 0.24 ) $ ( 0.03 ) Diluted $ ( 0.21 ) $ ( 0.24 ) $ ( 0.03 ) Six months ended June 30, 2026 Condensed Statements of Cash Flows As Computed under Weighted Average Cost As Computed under LIFO Effect of Change Net loss $ ( 9,212 ) $ ( 10,554 ) $ ( 1,342 ) Provision (benefit) for deferred income taxes 63 ( 557 ) ( 620 ) Inventory ( 11,859 ) ( 9,897 ) 1,962 Net Cash flows from Operating Activities ( 1,227 ) ( 1,227 ) - 9 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) Recently Adopted Accounting Standards In July 2025, the FASB issued Accounting Standards Update (“ASU”) 2025 - 05 “ Financial Instruments - Credit Losses (Topic 326 ): Measurement of Credit Losses for Accounts Receivable and Contract Assets. ” ASU 2025 - 05 permits the use of certain estimates and assumptions in developing forecasts used for determining expected credit losses on accounts receivable. This guidance was effective for us January 1, 2026 and did not materially impact our consolidated financial statements. Accounting Standards Issued, Not Yet Adopted In November 2024, the FASB issued ASU 2024 - 03 “ Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220 - 40 ): Disaggregation of Income Statement Expenses. ” ASU 2024 - 03 requires disaggregated disclosure of income statement expenses for public business entities. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. This guidance will be effective for us on January 1, 2027. The Company is currently evaluating the impact of the changes required by the new standard on the Company's financial statements and disclosures. In September 2025, the FASB issued ASU 2025 - 06 “ Intangibles – Goodwill and Other - Internal-Use Software (Subtopic 350 - 40 ): Targeted Improvements to the Accounting for Internal-Use Software. ” ASU 2025 - 06 eliminates the consideration of project development stages in determining whether a cost is eligible for capitalization. Instead, cost capitalization will be based on a “probable to complete” threshold. This guidance will be effective for us on January 1, 2028. We are evaluating the impact, if any, that the adoption of ASU 2025 - 06 may have on the Company's financial statements and disclosures. In December 2025, the FASB issued ASU 2025 - 10 “ Government Grants (Topic 832 ): Accounting for Government Grants Received by Business Entities. ” ASU 2025 - 10 finalizes proposed ASU No. 2024 - ED700 of the same name and establishes authoritative guidance for business entities on the recognition, measurement, and presentation of government grants. A government grant is defined, in part, as a transfer of a monetary asset from a government to a business entity. A government grant should not be recognized until it is probable that the business will comply with the conditions attached to the grant and that the grant will be received. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2029, and for interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The Company is evaluating this accounting standard and currently does not expect the adoption to have a material impact on its financial statements and disclosures. In May 2026, the FASB issued ASU 2026 - 02 “ Environmental Credits and Environmental Credit Obligations (Topic 818 ).” This update establishes comprehensive recognition, measurement, presentation, and disclosure guidance for participants in voluntary and compliance-based environmental credit programs, including Renewable Identification Numbers (“RINs”). Under the standard, internally generated environmental credits are measured initially at transaction or registration costs incurred, if any. The standard also expands disclosure requirements regarding an entity's involvement in environmental credit programs, including volumes generated, held, and transferred, as well as accounting policies for related compliance obligations. ASU 2026 - 02 is effective for the Company for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The standard permits adoption on a modified retrospective or prospective basis. While the Company historically does not allocate production costs to internally generated RINs, it is currently evaluating the impact of the new disclosure, measurement, and presentation requirements on its consolidated financial statements and footnote disclosures. 10 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 2 ) GOVERNMENT TAX CREDITS AND ASSET GRANTS Due to the lack of specific U.S. GAAP guidance for the following tax credits, the Company elected to follow International Accounting Standards (“IAS”) 20 principles (“Accounting for Government Grants”). Accordingly, the following credits were recognized as a reduction in the cost of goods sold, net of estimated selling expenses. In addition, the Company utilizes the deferral method for grants related to long-lived assets, whereby the grant is recognized as deferred income and amortized to Other expense, net, systematically over the asset's productive life. SMALL AGRI-BIODIESEL PRODUCER TAX CREDIT The Small Agri-Biodiesel Producer Tax Credit (“SPTC”) expired December 31, 2024. On July 4, 2025, the Budget Reconciliation Act of 2025 officially reinstated and extended the Small Producer's Tax Credit through December 31, 2026. This transferable, nonrefundable credit offers eligible producers—those with a capacity of 60 million gallons or less—$0.20 per gallon on the first 15 million gallons of fuel they produce. The benefit of this credit is recognized as a reduction in cost of goods sold following IAS 20. The Company recognized $ 1,490 and $ 1,845 in the three and six months ended June 30, 2026, respectively. CLEAN FUEL PRODUCTION TAX CREDIT The Clean Fuel Production Credit (“CFPC” or “45Z credit”), established by the Inflation Reduction Act of 2022 and extended through 2029 by the Budget Reconciliation Act of 2025, is a key incentive for low-emission transportation fuels. The Company’s biodiesel was approved for the CFPC in December 2024. This transferable, nonrefundable income tax credit uses a sliding scale based on the fuel's greenhouse gas emissions. The Company qualifies for an increased credit above the base of $0.20 per gallon for non-aviation fuel because it satisfies the prevailing wage and apprenticeship requirements. The Company recognized CFPC of $ 3,724 and $ 2,483 for the three months ended, and $ 4,888 and $ 2,483 for the six months ended, June 30, 2025 and 2026, respectively. TRANSFERABLE TAX CREDITS (SPTC and CFPC) The Company finalized an agreement in June 2026 to sell all 2025 SPTC and CFPC for $ 2,725 net of fees. These credits were previously estimated at December 31, 2025 at $ 2,654 . ASSET GRANT In conjunction with a facility expansion project in March 2011, the Company secured federal and state grants. The resulting asset, which has a 33 -year life, will have its value recognized as Other expense, net over the same period. 11 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 3 ) REVENUE RECOGNITION The majority of revenue is from short-term contracts with revenue recognized when a single performance obligation to transfer product under the terms of a contract with a customer is satisfied. Certain of the Company's custom chemical contracts within the chemical segment contain a material right as defined by ASC Topic 606 “Revenue from Contracts with Customers” (“ASC 606” ), from the provision of a customer option to purchase future goods or services at a discounted price as a result of upfront payments provided by customers. Each contract also has a performance obligation to transfer products with 30 -day payment terms. The Company recognizes revenue when the customer takes control of the inventory, either upon shipment or when the material is made available for pick up. If the customer is deemed to take control of the inventory prior to pick up, the Company recognizes the revenue as a bill-and-hold transaction in accordance with ASC 606. The Company applies the renewal option approach in allocating the transaction price to these material rights and transfer of product. As a basis for allocating the transaction price to the material right and transfer of product, the Company estimates the expected life of the contract, the expected contractual volumes to be sold over that life, and the most likely expected sales price. Each estimate is updated quarterly on a prospective basis. The Company leases warehouse space to a third -party tenant under a short-term lease agreement with a term of twelve months. Lease revenue recognized under this agreement was $ 170 for both the three months and $ 340 for both the six months ended June 30, 2026 and 2025, respectively. Contract Assets and Liabilities: Contract assets consist of unbilled amounts typically resulting from revenue recognized through bill-and-hold arrangements. The contract assets at June 30, 2026 and December 31, 2025 consist of unbilled revenue from one customer and unbilled capital reimbursement from three customers and are recorded as accounts receivable in the consolidated balance sheets. Contract liabilities consist of advance payment arrangements related to material rights recorded as deferred revenue in the consolidated balance sheets. Increases to contract liabilities from cash received or due for a performance obligation of chemical segment plant expansions were $ 188 and $ 125 for the three months and $ 188 and $ 125 for the six months ended June 30, 2026 and 2025, respectively. Contract liabilities are reduced as the Company transfers product to the customer under the renewal option approach. Revenue recognized in the chemical segment from the contract liability reductions was $ 366 and $ 80 for the three months and $ 711 and $ 110 for the six months ended June 30, 2026 and 2025 , respectively. During the six months ended June 30, 2026 and 2025, the Company recognized revenue of $ 523 and $ 106 , respectively, that was included in the deferred revenue balances as of December 31, 2025 and 2024, respectively. These contract asset and liability balances are reported on the consolidated balance sheets on a contract-by-contract basis at the end of each reporting period. The following table provides the balance of receivables, contract assets, and contract liabilities from contracts with customers. Contract Assets and Liability Balances June 30, 2026 June 30, 2025 December 31, 2025 December 31, 2024 Trade receivables, included in accounts receivable* $ 16,696 $ 10,724 $ 8,660 $ 14,991 Contract assets, included in accounts receivable 608 222 745 222 Contract liabilities, included in deferred revenue - short-term 661 929 1,519 697 Contract liabilities, included in deferred revenue - long-term 11,978 3,076 11,644 3,293 * Exclusive of the blender's tax credit (which expired 12/31/2024 ) of $ 0 , $ 0 , $ 0 , and $ 6,683 , respectively, the CFPC and SPTC of $ 2,800 , $ 0 , $ 0 , and $ 0 , respectively, and net of allowances for expected credit losses of $ 36 , $ 44 , $ 28 , and $ 29 , respectively, as of the dates noted. 12 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) Transaction price allocated to the remaining performance obligations: At June 30, 2026 , approximately $ 26,272 of revenue is expected to be recognized from the remaining performance obligations. The Company expects to recognize this revenue ratably over the expected sales over the expected term of its long-term contracts ranging from two to ten years. Approximately 11 % of this revenue is expected to be recognized over the next 12 months, and 53 % is expected to be recognized in years two and three, and 36 % in years four through ten. These amounts are subject to change based upon changes in the estimated contract life and estimated quantities to be sold over the contract life. The Company applies the practical expedient in ASC 606 - 10 - 50 - 14 and excludes the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Disaggregation of revenue: The following tables provide revenue from customers disaggregated by the type of arrangement and by the timing of the recognized revenue. Contractual and non-contractual: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Contract revenue from customers with > one-year arrangements $ 14,122 $ 3,129 $ 24,511 $ 5,098 Contract revenue from customers with < one-year arrangements 64,604 32,488 86,167 48,002 Revenue from non-contractual arrangements - 56 - 111 Total revenue $ 78,726 $ 35,673 $ 110,678 $ 53,211 Timing of revenue : Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Bill-and-hold revenue $ 13,027 $ 9,845 $ 23,405 $ 14,435 Non-bill-and-hold revenue 65,699 25,828 87,273 38,776 Total revenue $ 78,726 $ 35,673 $ 110,678 $ 53,211 As of June 30, 2026 and December 31, 2025 , $ 4,357 and $ 5,106 , respectively, of bill-and-hold revenue had not shipped. 13 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 4 ) INVENTORY The carrying values of inventory were as follows as of: As Adjusted (Note 1) June 30, 2026 December 31, 2025 At average cost (approximates current cost) Finished goods $ 17,234 $ 14,771 Work in process 761 684 Raw materials 22,697 13,879 $ 40,692 $ 29,334 Effective January 1, 2026, the Company changed its method of accounting for inventory from the LIFO method to the weighted average cost method. See Note 1 for additional information on the prior year effect. 5 ) OTHER CURRENT ASSETS Other current assets consisted of the following at: June 30, 2026 December 31, 2025 Supplies and parts $ 9,727 $ 9,372 Clean Fuel Production Credit (1) 4,928 2,460 Collateralization of derivative instruments, net of fair value (2) 2,261 2,266 Small Producers Tax Credit (1) 1,845 194 Other 169 91 Total $ 18,930 $ 14,383 ( 1 ) See Note 2 for additional information. ( 2 ) On regulated fixed price futures commitments as shown in Note 6. 14 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 6 ) DERIVATIVE INSTRUMENTS The Company records all derivative instruments at fair value. Fair value is determined by using the closing prices of the derivative instruments on the New York Mercantile Exchange at the end of an accounting period. Changes in the fair value of derivative instruments are recognized at the end of each accounting period and recorded in the statements of operations as a component of cost of goods sold. These instruments use inputs considered Level 1 holdings. Fair value accounting pronouncements include a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability developed based on market data obtained from sources independent of FutureFuel. Unobservable inputs are inputs that reflect FutureFuel’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances. The hierarchy is broken down into three levels. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. In order to manage commodity price risk caused by market fluctuations in feedstock and biofuel prices, future purchases of feedstock used in biodiesel production, physical feedstock, finished product inventories attributed to the process, and other petroleum products purchased or sold, the Company may enter into exchange-traded commodity futures and options contracts. The Company accounts for these derivative instruments in accordance with ASC Topic 815 - 20 - 25 “Derivatives and Hedging”, (“ASC 815” ). Under this standard, the accounting for changes in the fair value of a derivative instrument depends upon whether it has been designated as an accounting hedging relationship and, further, on the type of hedging relationship. To qualify for designation as an accounting hedging relationship, specific criteria must be met and appropriate documentation maintained. The Company had no derivative instruments that qualified under these rules as designated accounting hedges in 2026 or 2025 . The Company has elected the normal purchase and normal sales exception for certain feedstock purchase contracts and supply agreements. Total gains and losses on derivative instruments and changes in fair value of the derivative instruments are recorded in the consolidated statements of operations as a component of cost of goods sold and amounted to a net gain of $ 1,840 (including loss settlements of $ 1,383 ) and a net loss of $ 9,788 (including loss settlements of $ 10,523 ) for the three and six months ended June 30, 2026 , respectively, and net gains of $ 617 (includin g gain settlements of $ 77 ) and $ 450 (including gain settlements of $ 169 ) for the three and six months ended June 30, 2025 , respectively. The volumes and carrying values of FutureFuel’s derivative instruments were as follows at: Asset (Liability) June 30, 2026 December 31, 2025 Contract Quantity Fair Value Contract Quantity Fair Value Regulated fixed price future commitments, included in other current assets (in thousand barrels) 124 $ 721 165 $ ( 13 ) The margin account maintained with a broker to collateralize these derivative instruments carried an account balance of $ 1,540 and $ 2,266 at June 30, 2026 and December 31, 2025 , respectively, and was classified as other current assets in the consolidated balance sheets. The carrying values of the margin account and of the derivative instruments are included net in other current assets. 15 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 7 ) ACCRUED EXPENSES AND OTHER LIABILITIES Accrued expenses and other current liabilities consisted of the following at: June 30, 2026 December 31, 2025 Accrued employee liabilities $ 1,955 $ 1,386 Accrued property, franchise, motor fuel and other taxes 1,646 1,059 Lease liability, current 61 - Other 332 338 Total $ 3,994 $ 2,783 Other noncurrent liabilities consisted of the following at: June 30, 2026 December 31, 2025 Federal and state railroad grants $ 2,697 $ 2,809 Employment tax credit 3,055 2,737 Refundable deposits (1) 12,500 - Asset retirement obligation 1,521 1,502 Lease liability, noncurrent 263 - Total $ 20,036 $ 7,048 ( 1 ) Upfront payment received for plant expansion as part of a contract with a customer 8 ) BORROWINGS On February 21, 2025, the Company, with FutureFuel Chemical Company as the borrower and certain of the Company’s other subsidiaries as guarantors, amended and restated its credit agreement, as further amended effective as of June 30, 2025 and December 22, 2025 ( the “Credit Agreement”), originally entered into on April 16, 2015 with the lenders party thereto, Regions Bank as administrative agent and collateral agent, and PNC Bank, N.A., as syndication agent. The Credit Agreement consists of a five -year revolving credit facility in a dollar amount of up to $ 35,000 , which includes a sublimit of $ 30,000 for letters of credit and $ 15,000 for swingline loans (collectively, the “Credit Facility”). The Credit Facility expires on February 21, 2030. The interest rate floats at the following margins over Secured Overnight Financing Rate ("SOFR") or base rate based upon our consolidated leverage ratio. Adjusted SOFR Rate Loans and Consolidated Leverage Ratio Letter of Credit Fee Base Rate Loans Commitment Fee < 1.00:1.0 1.00 % 0.00 % 0.15 % ≥ 1.00:1.0 And < 1.50:1.0 1.25 % 0.25 % 0.15 % ≥ 1.50:1.0 And < 2.00:1.0 1.50 % 0.50 % 0.20 % ≥ 2.00:1.0 And < 2.50:1.0 1.75 % 0.75 % 0.20 % ≥ 2.50:1.0 2.00 % 1.00 % 0.25 % The terms of the Credit Facility contain certain negative covenants and conditions including a maximum consolidated leverage ratio and a minimum consolidated interest coverage ratio. There were no borrowings under the Credit Agreement at June 30, 2026 or December 31, 2025 . 16 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 9 ) INCOME TAX PROVISION The following table summarizes the income tax provision. Three Months Ended June 30, Six Months Ended June 30, As Adjusted (Note 1) As Adjusted (Note 1) 2026 2025 2026 2025 Income tax provision $ 69 $ 183 $ 77 $ 15 Effective tax rate 0.6 % ( 1.3 )% ( 0.8 )% 0.0 % The Company’s income tax provision for the three and six months ended June 30, 2026 and 2025, was comprised primarily of an increase in the valuation allowance against net deferred assets, plus immaterial state taxes and miscellaneous items. 10 ) LEASE COMMITMENTS During the second quarter of 2026, the Company entered into a new, five -year operating lease for a railroad locomotive. The lease fees are fixed with no option to purchase and no upfront fees or residual value guarantees. The Company determines lease existence and classification at inception when an agreement conveys the right to control the identified property for a period of time in exchange for consideration. As operating leases do not provide a readily determinable implicit interest rate, the Company uses an incremental borrowing rate based on information available at the commencement date in determining present value of the lease payments. The discount rate per annum was 5.6 %. The remaining term of the lease is four years and nine months. At June 30, 2026, an operating right-of-use asset of $ 324 was recorded in other assets, a current operating lease liability of $ 61 was recorded in accrued expenses and other current liabilities, and a noncurrent operating lease liability of $ 263 was recorded in other noncurrent liabilities. Operating lease expense for both the three and six months ended June 30, 2026, was $ 19 . Following are maturities of the lease liability at June 30, 2026. Remainder of 2026 $ 39 2027 77 2028 77 2029 and beyond 175 Total undiscounted lease payments 368 Less: imputed interest ( 44 ) Total lease liability $ 324 During the year ended December 31, 2025, the Company entered into a supply agreement with a third party that obligates the third party to construct a nitrogen plant to be used solely by the Company. The third party is also obligated to make certain capital improvements during the term of the agreement. The Company is obligated to provide and maintain related infrastructure and utilities and pay a monthly fee. The arrangement for the use of the nitrogen plant meets the definition of a lease under ASC Topic 842, Leases , as the Company will receive all output associated with it. Based on terms outlined in the agreement, the Company expects the lease with an estimated amount of $ 8,950 to $ 10,900 to be classified as a finance lease when the nitrogen plant is placed in service, which is expected to occur in 2027. 17 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 11 ) EARNINGS PER SHARE The Company computes earnings per share using the two -class method in accordance with ASC Topic No. 260, "Earnings per Share”, ("ASC 260” ). The two -class method is an allocation of earnings between the holders of common stock and a company’s participating security holders. The Company has outstanding Restricted Stock Units ("RSUs”) granted on September 3, 2024, for 750,000 shares which provide the holder with a non-forfeitable right to receive dividends on the full amount, even prior to vesting. The RSUs, and related dividends, vest in five equal installments on each anniversary of the award date. These RSUs are considered participating securities and require the use of the two -class method for computing basic and diluted earnings per share ("EPS”), pursuant to ASC 260 . There were no other outstanding RSUs for the periods ended June 30, 2026 and 2025. Basic and diluted earnings per common share were computed as follows: Three Months Ended June 30, Six Months Ended June 30, As Adjusted (Note 1) As Adjusted (Note 1) 2026 2025 2026 2025 Numerator: Net income (loss) $ 11,370 $ ( 14,190 ) $ ( 9,212 ) $ ( 32,284 ) Income allocated to participating securities (RSUs) 168 - - - Net income (loss) attributable to common stockholders $ 11,202 $ ( 14,190 ) $ ( 9,212 ) $ ( 32,284 ) Denominator: Weighted average shares outstanding – basic 44,029,003 43,803,243 44,027,914 43,803,243 Effect of dilutive securities: Stock options and other awards 10,826 - - - Weighted average shares outstanding – diluted 44,039,829 43,803,243 44,027,914 43,803,243 Basic income (loss) per share $ 0.25 $ ( 0.32 ) $ ( 0.21 ) $ ( 0.74 ) Diluted income (loss) per share $ 0.25 $ ( 0.32 ) $ ( 0.21 ) $ ( 0.74 ) The calculation of diluted earnings per share in the six months ended June 30, 2026 excludes the effect of incremental shares from the unvested RSUs and options to purchase the Company's stock, as their inclusion would be anti-dilutive due to the reported net loss. In the three and six months ended June 30, 2025, all of the prorated RSU's were excluded in the computation of earnings per share as all were anti-dilutive. Certain options to purchase the Company's common stock were not included in the computation of diluted earnings per share for the three and six months ended June 30, 2026 and 2025, respectively, because they were anti-dilutive in the period. The weighted number of options excluded was 119,174 and 124,587 for the three and six months ended June 30, 2026, respectively, and 50,000 and 45,000 for the three and six months ended June 30, 2025, respectively. 12 ) RELATED PARTY TRANSACTIONS FutureFuel enters into transactions with companies affiliated with or controlled by a director and significant shareholder. Expenses, prepaid amounts, and unpaid amounts related to these transactions are captured in the accompanying consolidated financial statements as related party line items. Related party cost of goods sold and distribution are the result of net sales and purchases of blended biodiesel with these related parties along with the associated expense from storage and terminalling services provided by these related parties. 18 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) 13 ) SEGMENT INFORMATION FutureFuel has two reportable segments organized along similar product groups – chemicals and biofuels. The chief operating decision maker ("CODM”) is Roeland Polet, our chief executive officer. The CODM reviews the significant components for each of our segments. The CODM evaluates the performance of each reportable segment and decides how to allocate resources based on segment gross profit (loss), which includes the revenue and expenses that are directly attributable to management of each segment. The CODM uses segment gross profit (loss) to assess the income generated by each reportable segment and to decide which reportable segment to reinvest profits or pay dividends. Segment gross profit (loss) is also used to analyze performance against the budget and the Company’s competitors. Chemicals FutureFuel’s chemical segment manufactures diversified chemical products that are sold externally to third party customers. This segment is composed of two components: “custom manufacturing” (manufacturing chemicals for specific customers) and “performance chemicals” (multi-customer specialty chemicals). Biofuels FutureFuel’s biofuel segment primarily manufactures and markets biodiesel. Biodiesel revenues are generated through the sale of biodiesel to customers through the Company’s distribution network at the Batesville plant and through a network of remotely located tanks. Biofuel revenues also include the sale of biodiesel blends with petrodiesel, petrodiesel with no biodiesel added, internally generated RINs, biodiesel production byproducts, and revenue and profits from Legacy Regional Transport. Biodiesel selling prices and profitability can at times fluctuate based on the timing of unsold, internally generated RINs. FutureFuel does not allocate production costs to internally generated RINs. The benefit derived from the eventual sale of the RINs is not reflected in results of operations until such time as the RINs sale has been completed, which may lead to variability in reported operating results. As of June 30, 2026 , FutureFuel held 0.1 million RINs with a fair market value of $ 210 . Comparatively, at June 30, 2025 , FutureFuel held 0.5 million RINs with a fair market value of $ 604 and at December 31, 2025 , 0.4 million RINs were held with a fair market value of $ 379 . The fair value of RINs is considered a Level 1 input and has no cost. Summary of business by segment Three Months Ended June 30, 2026 Six months ended June 30, 2026 Chemical Biofuel Total Chemical Biofuel Total Revenue $ 25,849 $ 52,877 $ 78,726 $ 45,481 $ 65,197 $ 110,678 Less: Cost of goods sold 20,593 42,029 62,623 42,387 67,247 109,635 Distribution 319 761 1,080 676 1,202 1,878 Segment gross profit (loss) $ 4,937 $ 10,087 $ 15,023 $ 2,418 $ ( 3,252 ) $ ( 835 ) Reconciliation of Segment gross profit (loss) to Net income (loss) before income taxes: Selling, general, and administrative expenses $ 3,080 $ 7,225 Research and development expenses 692 1,532 Other income, net ( 188 ) ( 457 ) Net income (loss) before income taxes $ 11,439 $ ( 9,135 ) 19 Notes to Consolidated Financial Statements of FutureFuel Corp. (Dollars in thousands, except per share and per gallon amounts) (Unaudited) Three Months Ended June 30, 2025 (As Adjusted (Note 1)) Six months ended June 30, 2025 (As Adjusted (Note 1)) Chemical Biofuel Total Chemical Biofuel Total Revenue $ 16,619 $ 19,054 $ 35,673 $ 25,984 $ 27,227 $ 53,211 Less: Cost of goods sold 15,211 32,177 47,388 30,351 49,224 79,575 Distribution 294 384 678 534 683 1,217 Segment gross profit (loss) $ 1,114 $ ( 13,507 ) $ ( 12,393 ) $ ( 4,901 ) $ ( 22,680 ) $ ( 27,581 ) Reconciliation of Segment gross profit (loss) to Net loss before income taxes: Selling, general, and administrative expenses $ 2,228 $ 5,112 Research and development expenses 933 2,324 Other income, net ( 1,547 ) ( 2,748 ) Net loss before income taxes $ ( 14,007 ) $ ( 32,269 ) Depreciation is allocated to segment cost of goods sold based on plant usage. The total assets and capital expenditures of FutureFuel have not been allocated to individual segments as large portions of these assets are shared to varying degrees by each segment, causing such an allocation to be of little value. 14 ) LEGAL MATTERS From time to time, FutureFuel and its subsidiaries are parties to, or targets of, lawsuits, claims, investigations, regulatory matters, and proceedings, which are being handled and defended in the ordinary course of business. While FutureFuel is unable to predict the outcomes of these matters, it does not believe, based upon currently available facts, that the ultimate resolution of any such pending matters will have a material adverse effect on its overall financial condition, results of operations, or cash flows. 15 ) SUBSEQUENT EVENTS The Company evaluated subsequent events that would require an adjustment to the Company’s consolidated financial statements or require disclosure in the notes to the consolidated financial statements through the date of issuance of the consolidated financial statements and determined no such events were required to be disclosed herein. 20