What changed in this filing

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Item 2. Management’s Discussion and Analysis

2021-11-10 compared with 2021-08-12 · 81 added, 67 removed, 214 unchanged (41% of the section changed)

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The following discussion and analysis should be read in conjunction with the information contained in the unaudited condensed consolidated interim financial statements of Heritage Global Inc.

(together with its consolidated subsidiaries, “we”, “us”, “our” or the “Company”) and the related notes thereto for the three and six month periods ended June 30, 2021 and 2020, appearing elsewhere herein, and in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the Securities and Exchange Commission (“SEC”) on March 8, 2021 (the “Form 10-K”).

(together with its consolidated subsidiaries, “we”, “us”, “our” or the “Company”) and the related notes thereto for the three and nine month periods ended September 30, 2021 and 2020, appearing elsewhere herein, and in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the Securities and Exchange Commission (“SEC”) on March 8, 2021 (the “Form 10-K”).

Forward Looking Information

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In 2019, the Company formed Heritage Global Capital LLC (“HGC”), a wholly-owned subsidiary of HGI, in order to provide specialty financing solutions to investors in charged-off and nonperforming asset portfolios.

The organization chart below outlines our basic domestic corp orate structure as of June 30 , 2021 .

In 2021, HGI acquired certain assets and liabilities of American Laboratory Trading, one of the largest suppliers of premium refurbished lab equipment in North America and a key provider of surplus asset services for the life sciences.

As a result of this acquisition, American Laboratory Trading operates as one of our wholly-owned divisions, ALT.

The organization chart below outlines our basic domestic corp orate structure as of September 30 , 2021 .

Full service, global auction, appraisal and asset advisory company.

Asset liquidation company that acquires and monetizes distressed and surplus assets.

Mergers and acquisitions (M&A) advisory firm specializing in financially distressed businesses and properties.

Supplier of refurbished lab equipment.

Broker of charged-off receivables.

Specialty financing solutions for charged-off and nonperforming asset portfolios.

The novel coronavirus (“COVID-19”) pandemic had a negative impact on our performance during the first and second quarter of 2021 due to evolving travel and work restrictions, stimulus payments and credit policies impacting debt sales, and a delay in the sale of certain assets.

Going forward, and subject to the caveat below, we do not believe the COVID-19 pandemic will have material negative impacts on our financial performance, as our asset liquidation business is highly concentrated in distressed and surplus assets and we expects that there will be an increased supply of distressed and surplus assets as a result of the COVID-19 pandemic and any downward trends in the overall economy, resulting in more potential for principal and fee based deals.

The novel coronavirus (“COVID-19”) pandemic had a negative impact on our performance during the first three quarters of 2021 due to evolving travel and work restrictions, stimulus payments and credit policies impacting debt sales by financial institutions, and a delay in the typical process for the sale of certain industrial assets by manufacturing companies.

Going forward, and subject to the caveat below, we do not believe the COVID-19 pandemic will have material negative impacts on our financial performance, as our asset liquidation business is highly concentrated in distressed and surplus assets and we expect that there will be an increased supply of distressed and surplus assets as a result of the COVID-19 pandemic and any downward trends in the overall economy, resulting in more potential for principal and fee based deals.

We believe that the continuing disruptions to the global supply chain, particularly those involving industrial assets, will further increase demand for U.S.-based surplus assets.

Further, when stimulus payments conclude, we expect that the COVID-19 pandemic will have the following positive impacts:

Further, as stimulus payments conclude, we expect that the COVID-19 pandemic will have the following positive impacts:

• increased activity for NLEX and HGC due to expanding volumes of nonperforming and charged-off consumer loans;

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• incremental valuation opportunities for our valuation business as a result of greater focus on collateral on bank balance sheets.

A new Delta variant of COVID-19, which appears to be the most transmissible variant to date, has begun to spread in the United States and across the globe.

A new Delta variant of COVID-19, which appears to be the most transmissible variant to date, has spread in the United States and across the globe.

Further surges in COVID-19 infection rates could result in the continuation of stimulus payments and the implementation of additional credit policies impacting debt sales that may result in delayed revenues depending on the scope and magnitude of such policies.

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In 2021, we increased our asset liquidation operations with our acquisition of certain assets and liabilities of American Laboratory Trading , a retailer of refurbished lab equipment and a key provider of surplus asset services for the life sciences.

As a result of the events and acquisitions outlined above, management believes that our expanded platform will allow us to achieve our long term industry leadership goals.

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We believe we have diversified business lines serving the financial and industrial asset liquidation market.

We have multiple revenue streams in our brokerage and principal based auction services, advisory services and

secured lending services.

We have multiple revenue streams in our brokerage and principal - based auction services, advisory services and secured lending services.

Further, our business is event- driven and we have repeat, forward-flow contracts in place with industry leading customers.

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On September 17, 2020, we entered into an Employment Agreement with Kirk Dove, the former President and Chief Operating Officer of the Company.

Upon his resignation, Kirk Dove will continue his employment with us in an advisory capacity until December 31, 2024.

Upon his resignation, Kirk Dove continued his employment with us in an advisory capacity under an agreement that runs through December 31, 2024.

Also during 2020, Nick Dove was appointed as President, Industrial Assets Division, and David Ludwig was appointed as President, Financial Assets Division.

Nick Dove previously served as Executive Vice President of Sales of Heritage Global Partners since August 2017.

David Ludwig previously served as President of NLEX, a wholly-owned subsidiary of the Company, and has served in such capacity since the Company acquired NLEX in 2014.

David Ludwig previously served as President of NLEX and has served in such capacity since the Company acquired NLEX in 2014.

Our Financial Assets Division

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Through HGC, we provide specialty financing solutions to investors in charged-off and nonperforming asset portfolios.

Since the inception of HGC in 2019, we have funded $23.6 million in total loans to investors by both self-funded loans and in partnership with our senior lenders.

Our portion of the total loans funded since inception was $8.7 million.

Since the inception of HGC in 2019, we have funded $27.0 million in total loans to investors by both self-funded loans and in partnership with senior lenders.

Our portion of the total loans funded since inception is $10.3 million.

Our income from secured lending consists of upfront fees, interest income, monthly monitoring fees and backend profit share.

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Our buyers consist of both end-users and dealers.

The acquisition of ALT further strengthens our service offering in the biotech and pharma sectors, which have been key verticals over the past decade.

Our management team has decades of domain expertise with the ability to leverage extensive industry relationships and has access to a real-time database of actual sales data across 28 industrial sectors.

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The critical accounting policies used in the preparation of our audited consolidated financial statements are discussed in our Form 10-K.

There have been no changes to these policies in the six months ended June 30, 2021.

There were no changes to these policies during the nine months ended September 30, 2021.

Management’s Discussion of Financial Condition

Liquidity and Capital Resources

We had working capital of $12.5 million and $13.0 million at June 30, 2021 and December 31, 2020, respectively.

We had working capital of $9.9 million and $13.0 million as of September 30, 2021 and December 31, 2020, respectively.

On October 6, 2020, we completed a public offering (the “2020 Public Offering”) of 5,462,500 shares of our common stock, at a public offering price of $1.75 per share, which included a full exercise of the underwriters’ option to purchase 712,500 additional shares of common stock from us.

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We intend and continue to use the net proceeds to provide additional funds for general corporate purposes, which may include, without limitation, the expansion of the businesses of HGC and HGP, working capital and growth capital.

Our current assets as of June 30, 2021 decreased to $22.0 million compared to $27.0 million as of December 31, 2020 primarily due to decreased cash as a result of cash used in operating activities during the six months ended June 30, 2021.

Our current liabilities as of June 30, 2021 decreased to $9.4 million compared to $14.0 million as of December 31, 2020 primarily due to the settlement of auction liabilities for certain auctions held in the fourth quarter of 2020.

During the six months ended June 30, 2021, our primary source of cash was the cash on hand plus the cash provided by our asset liquidation business.

Cash disbursements during the six months ended June 30, 2021 consisted primarily of lending activity of $4.8 million under HGC, payment of operating expenses, settlement of auction liabilities and investments in equity method investments.

Our current assets as of September 30, 2021 decreased to $19.8 million compared to $27.0 million as of December 31, 2020 primarily due to decreased cash as a result of cash used in operating activities during the nine months ended September 30, 2021 and the acquisition of certain assets and liabilities of American Laboratory Trading completed in the third quarter of 2021.

Our current liabilities as of September 30, 2021 decreased to $10.0 million compared to $14.0 million as of December 31, 2020 primarily due to the settlement of auction liabilities for certain auctions held in the fourth quarter of 2020.

During the nine months ended September 30, 2021, our primary source of cash was the cash on hand plus the cash provided by our asset liquidation business.

Cash disbursements during the nine months ended September 30, 2021 consisted primarily of lending activity of $5.9 million under HGC, the acquisition of certain assets and liabilities of American Laboratory Trading for $4.3 million, the acquisition of real estate used in American Laboratory Trading ’s business for $1.3 million, payment of operating expenses, settlement of auction liabilities and investments in equity method investments.

We believe we can fund our operations and our debt service obligations for at least 12 months from the date of filing this quarterly report through a combination of cash flows from our on-going asset liquidation operations, proceeds from the 2020 Public Offering, and draws on our 2021 Credit Facility, as needed.

Our indebtedness consists of any amounts borrowed under our 2021 Credit Facility.

Our indebtedness consists of any amounts borrowed under our 2021 Credit Facility as well as the ALT Note, which was issued as part of the acquisition of certain assets and liabilities of American Laboratory Trading.

On May 11, 2021, the Company entered into a promissory note, business loan agreement, commercial security agreement and pledge agreement with C3bank, National Association (the “2021 Credit Facility”) for a $10.0 million revolving line of credit , which replaced the 2020 Credit Facility.

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We are permitted to use the proceeds from the 2021 Credit Facility solely for our business operations.

We had no outstanding borrowings under the 2021 Credit Facility as of June 30, 2021 .

We had no outstanding borrowings under the 2021 Credit Facility as of September 30, 2021 .

We owed $2.0 million on the ALT Note as of September 30, 2021.

Ownership Structure and Capital Resources

As of June 30, 2021, the Company had stockholders’ equity of $30.4 million, as compared to $29.9 million as of December 31, 2020.

On May 11, 2021, the Company entered into a promissory note, business loan agreement, commercial security agreement and pledge agreement with C3bank, National Association for a $10.0 million revolving line of credit , which replaced the 2020 Credit Facility.

As of September 30, 2021, the Company had stockholders’ equity of $31.6 million, as compared to $29.9 million as of December 31, 2020.

On May 11, 2021, the Company entered into the 2021 Credit Facility , which replaced the 2020 Credit Facility.

The 2021 Credit Facility has a maturity date of May 11, 2023.

We had no outstanding borrowings under the 2021 Credit Facility as of June 30, 2021.

We had no outstanding borrowings under the 2021 Credit Facility as of September 30, 2021.

On October 6, 2020, the Company completed the 2020 Public Offering of an aggregate of 5,462,500 shares of the Company’s common stock, which included 712,500 shares of common stock sold pursuant to the full exercise of the underwriter’s option to purchase additional shares.

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Cash Position and Cash Flows

Cash and cash equivalents as of June 30, 2021 were $17.5 million as compared to $23.4 million as of December 31, 2020, a decrease of approximately $5.9 million.

Cash used in operating activities.

Cash used in operations was $4.3 million during the six months ended June 30, 2021 as compared to $0.8 million during the same period in 2020.

The approximate $3.5 million increase in cash used in operations was attributable to a change of $3.8 million in operating assets and liabilities during the six months ended June 30, 2021 as compared to the same period in 2020.

The amount was offset due to a change in net income adjusted for noncash items, which was $0.3 million higher during the six months ended June 30, 2021 as compared to the same period in 2020.

The significant changes in operating assets and liabilities during the six months ended June 30, 2021 as compared to the same period in 2020 are primarily due to the nature of our operations.

Cash and cash equivalents as of September 30, 2021 were $13.2 million as compared to $23.4 million as of December 31, 2020, a decrease of approximately $10.2 million.

Cash (used in) provided by operating activities.

Cash used in operations was $4.1 million during the nine months ended September 30, 2021 as compared to cash provided by operating activities of $2.8 million during the same period in 2020.

The approximate $6.9 million change was primarily attributable to a change of $6.7 million in operating assets and liabilities during the nine months ended September 30, 2021 as compared to the same period in 2020.

The amount was further attributable to a change in net income adjusted for noncash items, which was $0.2 million lower during the nine months ended September 30, 2021 as compared to the same period in 2020.

The significant changes in operating assets and liabilities during the nine months ended September 30, 2021 as compared to the same period in 2020 are primarily due to the nature of our operations.

We earn revenue from discrete asset liquidation deals that vary considerably with respect to their magnitude and timing, and that can consist of fees, commissions, asset sale proceeds, or a combination thereof.

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Cash (used in) provided by investing activities.

Cash used in investing activities during the six months ended June 30, 2021 was $0.8 million compared to cash provided by investing activities of $0.5 million during the same period in 2020 .

The approximate $1.3 million change was primarily attributable to approximately $5.7 million cash received on transfer of notes receivable to partners and payments received on notes receivable in the six months ended June 30, 2020 compared to $4.5 million in the same period in 2021.

Cash used in financing activities.

Cash used in financing activities was $0.8 million during the six months ended June 30, 2021 compared to cash used in financing activities of $0.2 million during the six months ended June 30, 2020.

Financing activities during the six months ended June 30, 2021 consisted primarily of payments of tax withholdings related to cashless exercises of stock option awards, in excess of proceeds from issuance of common stock related to standard exercises of stock option awards.

Cash used in investing activities during the nine months ended September 30, 2021 was $7.3 million compared to cash provided by investing activities of $0.6 million during the same period in 2020 .

The approximate $7.9 million change was primarily attributable to the acquisition of certain assets and liabilities of American Laboratory Trading for $4.3 million and the acquisition of real estate used in American Laboratory Trading ’s business for $1.3 million in the third quarter of 2021.

The remaining $2.3 million change is primarily attributable to $0.7 million in additional transfers of notes receivable to partners and payments received on notes receivable in the prior period compared to the current period, and additional investments in notes receivable of $1.4 million in the current period compared to the prior period.

Cash provided by (used in) financing activities.

Cash provided by financing activities was $1.2 million during the nine months ended September 30, 2021 compared to cash used in financing activities of $0.4 million during the nine months ended September 30, 2020.

Financing activities during the nine months ended September 30, 2021 consisted primarily of $2.0 million in proceeds from the issuance of the ALT Note as part of the acquisition of certain assets and liabilities of American Laboratory Trading and payments of tax withholdings related to cashless exercises of stock option awards, in excess of proceeds from issuance of common stock related to standard exercises of stock option awards.

Financing activities during the same period in 2020 consisted of draws on the 2020 Credit Facility of $5.6 million and repayments of third party loans of $5.9 million (including $5.6 million on the 2020 Credit Facility).

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Our significant contractual obligations are our third party loans, client and partner asset liquidation settlement payments and lease obligations.

The loan and lease obligations are fully described in the notes to the financial statements included in our Form 10-K.

The loan and lease obligations are fully described in the notes to the condensed consolidated financial statements included in our Form 10-K.

On March 30, 2021, the Company and Scott West entered into a Separation Agreement and General Release (the “Separation Agreement”).

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West, and the Separation Agreement includes confidentiality, non-disparagement and other obligations.

On August 23, 2021, a wholly-owned subsidiary (“ALT Purchaser”) of HGI acquired (the “Transaction”) certain assets and liabilities of American Laboratory Trading , pursuant to the terms and conditions of an Asset Purchase Agreement (the “Asset Purchase Agreement”), dated August 18, 2021, among the Company, American Laboratory Trading and certain individuals named therein.

The aggregate purchase price paid to American Laboratory Trading was approximately $4.3 million, consisting of $2.3 million in cash, as adjusted for American Laboratory Trading 's working capital, and a $2.0 million subordinated promissory note with an interest rate of 3% per annum and a maturity date of August 23, 2025 (the “ALT Note”).

The Asset Purchase Agreement contains customary representations and warranties and covenants by each party.

American Laboratory Trading and ALT Purchaser are obligated, subject to certain limitations, to indemnify the other under the Asset Purchase Agreement for losses arising from certain breaches of the Asset Purchase Agreement and for certain other liabilities, subject to applicable limitations set forth in the Asset

Purchase Agreement.

HGI has guaranteed the obligations of ALT Purchaser under the terms of the Asset Purchase Agreement and the ALT Note.

On August 23, 2021, in connection with the Transaction, a wholly-owned subsidiary of HGI (“RE Purchaser”), acquired the real property used in American Laboratory Trading ’s business (the “Property”) pursuant to a Purchase and Sale Agreement (the “Real Estate Purchase Agreement” and together with the Purchase Agreement, the “Agreements”), dated August 18, 2021, between 12 Colton Road, LLC and RE Purchaser.

The purchase price for the Property was $1.3 million.

The Real Estate Purchase Agreement contains customary representations and warranties and covenants by each party.

The parties to the Real Estate Purchase Agreement are obligated, subject to certain limitations, to indemnify the other under the Real Estate Purchase Agreement for losses arising from certain breaches of the Real Estate Purchase Agreement and other liabilities, subject to applicable limitations set forth in the Real Estate Purchase Agreement.

Management’s Discussion of Results of Operations

The following table sets out the Company’s condensed consolidated results of operations for the three and six months ended June 30, 2021 and 2020 (dollars in thousands).

Three Months Ended June 30,

Six Months Ended June 30,

The following table sets out the Company’s condensed consolidated results of operations for the three and nine months ended September 30, 2021 and 2020 (dollars in thousands).

Three Months Ended September 30,

Nine Months Ended September 30,

Services revenue

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Interest and other expense, net

Income before income tax benefit

Income tax benefit

Income before income tax expense (benefit)

Income tax expense (benefit)

Our asset liquidation business model has several components:

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The following table sets forth certain financial information for the Company's reportable segments (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Industrial Assets Division:

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Net operating income

Three-Month Period Ended June 30, 2021 Compared to Three-Month Period Ended June 30, 2020

Revenues and cost of revenues – Revenues were $5.2 million during the three months ended June 30, 2021 compared to $6.1 million during the same period in 2020.

Costs of services revenue and asset sales were $1.3 million during the three months ended June 30, 2021 compared to $1.5 million during the same period in 2020.

The gross profit of these items was $3.8 million during the three months ended June 30, 2021 compared to $4.6 million during the same period in 2020, a decrease of approximately $0.8 million, or approximately 17%.

Three-Month Period Ended September 30, 2021 Compared to Three-Month Period Ended September 30, 2020

Revenues and cost of revenues – Revenues were $6.0 million during the three months ended September 30, 2021 compared to $7.6 million during the same period in 2020.

Costs of services revenue and asset sales were $1.8 million during the three months ended September 30, 2021 compared to $2.6 million during the same period in 2020.

The gross profit of these items was $4.2 million during the three months ended September 30, 2021 compared to $5.0 million during the same period in 2020, a decrease of approximately $0.8 million, or approximately 15%.

The decreased gross profit in the second quarter of 2021 reflects the vagaries of the timing and magnitude of asset liquidation transactions.

Selling, general and administrative expense – Selling, general and administrative expense was $3.7 million during the three months ended June 30, 2021 and June 30, 2020.

Significant components of selling, general and administrative expense for the three months ended June 30, 2021 and June 30, 2020 are shown below (dollars in thousands):

Three Months Ended June 30,

Selling, general and administrative expense – Selling, general and administrative expense was $3.5 million during the three months ended September 30, 2021 compared to $3.4 million during the same period in 2020.

Significant components of selling, general and administrative expense for the three months ended September 30, 2021 and September 30, 2020 are shown below (dollars in thousands):

Three Months Ended September 30,

Stock-based compensation

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Total selling, general & administrative expense

Although our total selling, general and administrative expense remained consistent during the three months ended June 30, 2021 compared to the same period in 2020, the Company incurred increased legal expense due to our annual shareholder meeting, offset by decreased compensation expense based on declined performance in our NLEX and HGP divisions.

Depreciation and amortization expense – Depreciation and amortization expense was $0.1 million during the three months ended June 30, 2021 and the same period in 2020, which consisted primarily of amortization expense related to intangible assets.

Six -Month Period Ended June 30, 2021 Compared to Six -Month Period Ended June 30, 2020

Revenues and cost of revenues – Revenues were $12.3 million during the six months ended June 30, 2021 compared to $10.4 million during the same period in 2020.

Costs of services revenue and asset sales were $3.3 million during the six months ended June 30, 2021 compared to $2.1 million during the same period in 2020.

The gross profit of these items was $9.0 million during the six months ended June 30, 2021 compared to $8.3 million during the same period in 2020, an increase of approximately $0.7 million, or approximately 8%.

The increased gross profit in the current year reflects the vagaries of the timing and magnitude of asset liquidation transactions.

Selling, general and administrative expense – Selling, general and administrative expense was $7.6 million during the six months ended June 30, 2021 and $7.1 million during the same period in 2020.

Six Months Ended June 30,

Although our total selling, general and administrative expense remained relatively consistent during the three months ended September 30, 2021 compared to the same period in 2020, the Company incurred increased compensation, accounting and legal fees due to the acquisition of ALT ’s business, offset by decreased compensation expense based on declined performance in our NLEX divisions.

Depreciation and amortization expense – Depreciation and amortization expense was $0.1 million during the three months ended September 30, 2021 and the same period in 2020, which consisted primarily of amortization expense related to intangible assets.

Nine-Month Period Ended September 30, 2021 Compared to Nine-Month Period Ended September 30, 2020

Revenues and cost of revenues – Revenues were $18.3 million during the nine months ended September 30, 2021 compared to $17.9 million during the same period in 2020.

Costs of services revenue and asset sales were $5.1 million during the nine months ended September 30, 2021 compared to $4.7 million during the same period in 2020.

The gross profit of these items was $13.2 million during the nine months ended September 30, 2021 and the same period in 2020.

Although consistent this quarter, changes can result due to the vagaries of the timing and magnitude of asset liquidation transactions.

Selling, general and administrative expense – Selling, general and administrative expense was $11.1 million during the nine months ended September 30, 2021 and $10.5 million during the same period in 2020.

Nine Months Ended September 30,

Stock-based compensation

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Total selling, general & administrative expense

As compared to the six months ended June 30, 2020, there was an increase in selling, general and administrative expense during the six months ended June 30, 2021 due to increased compensation expense within our HGI and HGP divisions as a result of improved financial performance and a one-time expense related to the Separation Agreement.

This increase was partially offset by decreased compensation expense within our NLEX division as a result of declined financial performance, and decreased travel expense as a result of travel restrictions related to the COVID-19 pandemic.

Depreciation and amortization expense – Depreciation and amortization expense was $0.2 million during the six months ended June 30, 2021 and the same period in 2020, which consisted primarily of amortization expense related to intangible assets.

As compared to the nine months ended September 30, 2020, there was an increase in selling, general and administrative expense during the nine months ended September 30, 2021 due to increased compensation expense within our HGI and HGP divisions as a result of improved financial performance, increased compensation, accounting and legal fees due to the acquisition of ALT ’s business, and a one-time expense related to the Separation Agreement.

This increase was partially offset by decreased compensation expense within our NLEX division as a result of declined financial performance.

Depreciation and amortization expense – Depreciation and amortization expense was $0.3 million during the nine months ended September 30, 2021 and the same period in 2020, which consisted primarily of amortization expense related to intangible assets.

Key Performance Indicators

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Management believes that the presentation of EBITDA and Adjusted EBITDA, when considered together with our GAAP financial statements and the reconciliation to the most directly comparable GAAP financial measure, is useful in providing investors a more complete understanding of the factors and trends affecting the underlying performance of the Company on a historical and ongoing basis.

Our use of EBITDA and Adjusted EBITDA is not meant to be, and should not be, considered in isolation or as a substitute for,

or superior to, any GAAP financial measure.

Our use of EBITDA and Adjusted EBITDA is not meant to be, and should not be, considered in isolation or as a substitute for, or superior to, any GAAP financial measure.

You should carefully evaluate the financial information below, which reconciles our GAAP reported net income to EBITDA and Adjusted EBITDA for the periods presented (in thousands).

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Depreciation and amortization

Interest and other expense, net

Income tax benefit

Income tax expense (benefit)

Management add back:

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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 2. Management’s Discussion and Analysis