What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-06 compared with 2025-11-06 · 85 added, 75 removed, 105 unchanged (60% of the section changed)

Management’s discussion and analysis of financial condition and results of operations

The following discussion should be read in conjunction with the unaudited consolidated financial statements and accompanying notes included in Part I, Item 1, of this Quarterly Report on Form 10-Q and the audited consolidated financial statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Annual Report on Form 10-K for the fiscal year ended May 25, 2025 (the “2025 Annual Report”).

The following discussion should be read in conjunction with the unaudited consolidated financial statements and accompanying notes included in Part I, Item 1, of this Quarterly Report on Form 10-Q and the audited consolidated financial statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Transition Report on Form 10-KT for the transition period ended December 31, 2025 (the “2025 Transition Report”).

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains forward-looking statements regarding future events and our future results that are subject to the safe harbor created under the Private Securities Litigation Reform Act of 1995 and other safe harbors under the Securities Act of 1933, as amended, and the Exchange Act.

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• our ability to comply with covenants under our credit agreements and to pay required interest and principal payments when due;

• our ability to fund any redemptions of shares of the outstanding Series A Redeemable Convertible Preferred Stock if requested by holders in accordance with their terms;

• our ability to raise additional capital for ongoing needs, including through equity financing, debt financing, collaborations, strategic alliances or licensing arrangements;

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Accordingly, our actual results could differ materially from those projected in the forward-looking statements for many reasons, including the risk factors referenced in Item 1A.

“Risk Factors” of this report.

All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements as well as others made in this report, the 2025 Annual Report, and hereafter in our other SEC filings and public communications.

“Risk Factors” of the 2025 Transition Report.

All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements as well as others made in this report, the 2025 Transition Report, and hereafter in our other SEC filings and public communications.

You should evaluate all forward-looking statements made by us in the context of all risks and uncertainties described with respect to our business.

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Lifecore is a fully integrated CDMO that offers highly differentiated clinical and commercial capabilities in the development, cGMP manufacturing and aseptic filling of complex formulations and highly viscous sterile injectable pharmaceutical drug or medical device products in syringes, vials and cartridges, across a wide variety of modalities.

We manufacture hyaluronic acid (“HA”) in bulk form as well as for use in formulated and filled syringes and vials for our customers’ injectable products used in treating a broad spectrum of medical conditions and procedures, including ophthalmic and orthopedic applications.

We manufacture pharmaceutical-grade, non-animal-sourced hyaluronic acid (“HA”) in bulk form as well as for use in formulated and filled syringes and vials for our customers’ injectable products used in treating a broad spectrum of medical conditions and procedures, including ophthalmic and orthopedic applications.

We also offer product development service capabilities to our customers that include analytical method development and validation, formulation development, sterile filtration, process scale-up, pilot studies, stability studies, process validation and production of materials for clinical studies.

Lifecore continues to make impactful improvements to operations, resulting in reduced operational expenses and improved productivity.

Through active management and targeted initiatives, the Company has improved workforce productivity by more than 20% over approximately the past year.

This achievement reflects the performance-driven culture at Lifecore and underscores the Company’s commitment to continuous improvement.

Lifecore plans to further maximize efficiencies and productivity via aggressive procurement and operational strategies.

The Company believes that a key catalyst in this effort will be the launch of its new enterprise resource planning (“ERP”) system, which is expected to go live in Q1 2026.

Since May 2024, Lifecore has continued to make impactful improvements to its operations and financial position:

• We have improved operations by expanding our revenue‑generating capacity, increasing our focus on manufacturing efficiency and cost management, and investing in systems and processes to support more effective execution.

In September 2024, the Company expanded its aseptic filling capabilities through the installation of a fully automated high‑speed, multi‑purpose 5‑head aseptic isolator filler.

In January 2026, Lifecore implemented a new enterprise resource planning (“ERP”) system designed to enhance inventory control, data visibility, and financial management.

Through these and other initiatives, the Company believes that it has improved workforce productivity, reflecting the performance-driven culture at Lifecore and underscoring the Company’s commitment to continuous improvement.

• We have strengthened our financial position through, among other actions, (i) raising $24.3 million in a private placement of Lifecore common stock in October 2024, (ii) a three-year term extension of our existing asset-based lending revolving credit facility with BMO in November 2024, (iii) the sale of certain excess capital equipment for $17 million in January 2025, (iv) the repayment of $19.7 million of borrowings on our outstanding revolving credit facility over the past 18 months, (v) reduced obligations with the payment of an aggregate amount of $4.7 million to the holders of the Redeemable Convertible Preferred Stock in full satisfaction of outstanding registration delay fees in November 2025, and (vi) the implementation of operational cost reductions, including overhead costs and professional fees associated with legal, accounting and consulting spend.

Lifecore expects to further improve efficiencies and productivity through additional procurement and operational strategies that will build upon the new capabilities and information available from our ERP system.

Lifecore expects this system to strengthen inventory control, support sharper financial management, and help reduce costs as the company grows.

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This newly created position will champion the Company’s efforts to improve its cost structure, to drive productivity, and gain efficiencies.

On August 1, 2025, the Company’s Board of Directors approved a change in the Company’s fiscal year that ends on the last Sunday of May to a fiscal year that corresponds with the calendar year, ending on December 31, effective for the fiscal year beginning May 26, 2025 and ending December 31, 2025.

The Fiscal Year Change is applied on a prospective basis and does not adjust operating results for prior periods.

As a result of the Fiscal Year Change, commencing with this Quarterly Report on Form 10-Q, the Company will be filing Quarterly Reports on Form 10-Q covering quarterly periods on a calendar year basis.

Also as a result of the Fiscal Year Change, the Company will file a Form 10-KT covering the “transition period” beginning May 26, 2025 and ending December 31, 2025, which will include separate reporting of the approximately one-month period from May 26 to June 30, 2025.

For periodic reports covering periods through and including June 30, 2026 (including this Quarterly Report on Form 10-Q), the Company will select comparative financial information in accordance with SEC rules that are applicable to the Fiscal Year Change.

Specifically, for balance sheet information, the Company will present information from the latest audited date, which for this Quarterly Report on Form 10-Q is May 25, 2025;

and for period-based information, the Company will present the most closely-comparable previously reported three-month period, which for this Quarterly Report on Form 10-Q is the three months ended August 25, 2024.

This comparative information is selected to provide meaningful context for evaluating the Company’s performance through and including June 30, 2026.

On August 1, 2025, our Board of Directors approved a change in the Company’s fiscal year from a fiscal year ending on the last Sunday of May to a calendar year ending on December 31.

Since September 30, 2025, the Company has been reporting calendar periods in its quarterly periodic reports.

In accordance with SEC rules, the Company is presenting current period results compared to the most closely-comparable previously-reported three-month period through June 30, 2026.

For this report, the most closely-comparable previously-reported period is the three-month period ended February 23, 2025.

It is not practicable or cost-justifiable for the Company to prepare equivalent calendar-based comparative periods because the Company’s previous fiscal calendar does not align to the new calendar periods.

Accordingly, readers should consider the differences in calendar timing when comparing results between periods.

The discussion and analysis that follows focuses on the Company’s financial condition, results of operations, and cash flows for the calendar quarter ended September 30, 2025, compared to the three-month period ended August 25, 2024.

Where applicable, management has highlighted material variances and provided commentary on key drivers of performance, including the impact of the fiscal year change.

Beginning September 30, 2026, the Company will provide calendar-based comparative periods.

Financial overview

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HA manufacturing includes the production and sale of pharmaceutical-grade, non-animal-sourced HA using our proprietary, fermentation-based HA process in bulk form.

The following costs are included in cost of goods sold:

The following costs are included in cost of sales:

raw materials (including packaging, syringes, fermentation supplies and purification supplies), direct labor, overhead (including indirect labor, depreciation, and facility-related costs), and shipping and shipping-related costs.

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Public company costs include compliance, audit, tax, insurance and investor relations.

The debt derivative liability, related party, is a set of embedded derivatives recorded at fair value each period.

The derivatives represent certain call and put premiums contained in the credit facility that can be exercised upon qualifying events of default or changes in control.

The debt derivative liability, related party, represents the fair value of various features in the credit facility that require bifurcation and accounting as a derivative instrument.

Changes in the fair value are recorded as non-operating income or expense.

Three months ended September 30, 2025

Three months ended March 31, 2026

Revenues and gross profit

Three months ended Change

September 30,

2025 August 25,

(dollars in thousands) March 31,

2026 February 23,

2025 Amount %

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Gross profit percentage 19.2 % 28.0 % (8.8) %

The increase in revenues of $6.4 million was primarily due to a $4.8 million increase in HA manufacturing revenues primarily from increased demand from a customer due to its supply chain initiatives.

In addition, CDMO revenues increased $1.6 million , which was primarily from $2.6 million of higher sales volumes and $0.3 million of pricing and other revenue.

These gains were partially offset by $1.3 million of lower development revenue due to completion of a discrete development project in the prior comparable period and timing of customer project lifecycles.

The increase of $2.4 million in gross profit is due a $4.3 million increase in HA manufacturing gross profit due to increased sales volume and manufacturing absorption, partially offset by a $1.9 million decrease in CDMO gross profit.

The CDMO decline was due to lower development revenue of $1.4 million and a decrease in aseptic gross profit of $1.9 million due to product mix and costing, partially offset by favorable manufacturing absorption of $1.4 million.

The decrease in revenues of $12.0 million was primarily due to a $6.9 million decrease in HA manufacturing revenues primarily from the absence of increased demand in the prior period from a customer due to its supply chain initiatives.

In addition, CDMO revenues decreased $5.0 million , which was primarily from $2.9 million of lower sales volumes, $1.3 million of lower development revenue due to completion of discrete development projects in the prior comparable period and timing of customer project lifecycles, and a $0.9 million contractual take-or-pay arrangement in the prior period .

The decrease of $5.4 million in gross profit is due a $5.7 million decrease in HA manufacturing gross profit due to decreased sales volume and manufacturing absorption, partially offset by a $0.2 million increase in CDMO gross profit.

The CDMO increase was due to mix and costing and $0.9 million of higher prior year costs due to a customer termination resulting in write-off of inventory and equipment, partially offset by a $0.9 million contractual take-or-pay arrangement in the prior period .

Operating expenses

Three months ended Change

September 30,

2025 August 25,

(dollars in thousands) March 31

2026 February 23

2025 Amount %

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Selling, general and administrative 7,917 9,978 (2,061) (21) %

Loss on sale or disposal of assets, net of portion classified as cost of sales

— 6,851 (6,851) (100) %

Total operating expenses $ 9,134 $ 18,874 $ (9,740) (52) %

Research and development (“R&D”)

R&D expenses modestly declined reflecting a relatively consistent level of product development and commercialization activities.

R&D expenses declined primarily due to lower cost of sales allocations, as well as a reduction in stock-based compensation.

Selling, general, and administrative (“SG&A”)

The $5.9 million decrease in SG&A expenses includes a reduction of $2.2 million in recurring accounting, legal and consulting expenses and a net $3.7 million reduction in non-recurring expenses primarily related to legacy matters.

Included in SG&A for the current period is $1.6 million of non-recurring costs p rimarily related to legal expenses related to legacy matters and excess audit fees.

The prior period included $3.6 million of non-recurring expenses primarily related to incremental audit and consulting fees for the legacy financial restatement and legal expenses related to legacy matters, $1.2 million related to the stockholder activist settlement and $0.5 million of restructuring costs.

The $2.1 million decrease in SG&A expenses includes $1.6 million of lower recurring legal and accounting expenses, lower compensation and lower credit losses, as well as a $0.5 million net reduction in non-recurring expenses primarily related to legacy legal matters.

Included in SG&A for the current period is $1.6 million of non-recurring costs p rimarily related to legal expenses related to legacy matters and business transformation expenses.

The prior period included $2.1 million of non-recurring expenses primarily related to legal expenses related to legacy matters.

Loss on sale or disposal of assets

The $6.9 million loss on sale or disposal of assets in the prior period was primarily due to a $6.4 million loss on the sale of certain excess equipment that was primarily related to the write-off of historically capitalized interest costs, as well as $0.5 million related to capital projects that were abandoned.

Non-operating income or expense

Three months ended Change

September 30,

2025 August 25,

(dollars in thousands) March 31,

2026 February 23,

2025 Amount %

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Change in fair value of debt derivative liability, related party (3,155) (600) (2,555) n/m

Other expense, net 110 (203) 313 n/m

Other expense, net 110 333 (223) (67) %

Income tax (expense) benefit (43) 8 (51) n/m

Interest expense, net

The increase in interest expense, net of interest income, included an increase of $1.3 million related to the Alcon term loans, which will continue to grow due to accumulating interest paid-in-kind and amortization of the debt discount, partially offset by a $0.4 million decrease due to lower outstanding borrowings under the revolving credit facility.

The increase in interest expense, net of interest income, included an increase of $1.4 million related to the Alcon term loans, which will continue to grow due to accumulating interest paid-in-kind and amortization of the debt discount.

Change in fair value of debt derivative liability, related party

The $1.3 million change from income to expense was primarily due to a decrease in discount rates in the 2024 period and the passage of time in the 2025 period.

The $2.6 million increase in expense was primarily attributable to changes in key valuation inputs during the period, including a higher discount rate caused by a decline in the Company’s synthetic credit rating, as well as the passage of time.

Other expense, net

The change from expense to income was primarily caused by the absence of $0.3 million of estimated expense accrued for monetary penalties to the preferred stockholders following the filing of registration statements in October 2024.

The decrease in other expense, net was immaterial.

Income tax benefit or expense

The change from income to expense of $0.4 million was primarily caused by the passage of new Federal tax laws in the 2025 period that resulted in higher deferred tax expense.

The new tax laws caused a one-time acceleration of various tax deductions which did not result in income due to the establishment of valuation allowances on all deferred tax assets.

At the same time, that acceleration reduced deductions available to offset future deferred tax liabilities, causing an increase to deferred tax expense.

The income tax benefit or expense primarily consists of current state income tax obligations and a schedule of net deferred federal tax attributes that are substantially offset by valuation allowances and net operating loss carryforwards.

Changes in the income tax benefit or expense are driven by the mix of these various items and were not significant for the periods presented.

Liquidity and capital resources

As of September 30, 2025, the Company had cash of $18.9 million.

In June 2025, the Company received $10.0 million cash from the early payment of principal under its note receivable from the sale of equipment in fiscal year 2025.

In June 2025, the Company repaid $2.5 million of borrowings on the outstanding revolving credit facility .

Based on the borrowing base at September 30, 2025, the Company had approximately $23.6 million available for borrowing under the Revolving Credit Facility of the $40.0 million maximum committed amount.

Under the Revolving Credit Facility, the Company is subject to a springing fixed charge ratio covenant of 1:1 generally in the event that the Company's available liquidity under the Revolving Credit Facility falls below $2.5 million.

As of September 30, 2025, the Company was in compliance with all financial covenants under the Term Loan Credit Facility and Revolving Credit Facility.

As of March 31, 2026, the Company had cash of $20.8 million and $17.3 million available for borrowing (together, “consolidated liquidity”) under its $40.0 million Revolving Credit Facility, with no amounts outstanding as of March 31, 2026.

As of March 31, 2026, the Company had approximately $194.2 million in total indebtedness with Alcon, with $188.6 million outstanding under the Term Loan Credit Facility.

The Company is subject to minimum liquidity covenants under its credit agreements, the most restrictive of which requires the Company to maintain at least $4.0 million of consolidated liquidity, as adjusted for any excess payables, at the end of each fiscal quarter.

As of March 31, 2026, the Company was in compliance with all financial covenants under the Term Loan Credit Facility and Revolving Credit Facility.

See “Part I, Item 1.

Note 9 – Debt” in this Quarterly Report on Form 10-Q for a summary of the Term Loan Credit Facility and Revolving Credit Facility.

Cash flow improved by $1.6 million in the three months ended September 30, 2025 compared to the three months ended August 25, 2024 period for the following reasons:

The following table presents comparative summary cash flows for the three months ended March 31, 2026 and February 23, 2025 :

Three months ended Change

(in thousands)

March 31, 2026 February 23, 2025

Net cash provided by (used in):

Operating activities

$ 4,700 $ 1,199 $ 3,501

Investing activities

(1,118) 1,544 (2,662)

Financing activities

(256) (6,783) 6,527

$ 3,326 $ (4,040) $ 7,366

Cash flow improved by $7.4 million in the three months ended March 31, 2026 compared to the three months ended February 23, 2025 for the following reasons:

• Operating cash flows improved $3.5 million.

In the 2024 period, earnings as adjusted for non-cash items used cash of $8.1 million, which was partially funded by $7.5 million of favorable working capital changes primarily related to net receivable collections and extension of accounts payable.

In contrast, in the 2025 period, earnings as adjusted for non-cash items generated $1.1 million of cash, and changes in working capital of $0.6 million;

• Investing cash outflows decreased by $1.7 million from lower capital spending in the 2025 period compared to the 2024 period;

• Financing cash flows decreased $2.5 million as a result of the absence of $1.9 million of net proceeds under the revolving credit facility in the 2024 period and due to higher cash payments of $0.6 million under employee stock plans.

In the 2025 period, earnings as adjusted for non-cash items generated $3.6 million, which was partially offset by $2.4 million of net working capital changes.

In contrast, in the 2026 period, earnings as adjusted for non-cash items used $0.8 million of cash, offset by changes in working capital of $5.5 million primarily related to receivable collections;

• Investing cash flows decreased by $2.7 million due to the absence of $7.0 million cash from the sale of certain excess equipment in the 2025 period, partially offset by lower capital spending in the 2026 period compared to the 2025 period;

• Financing cash outflows decreased $6.5 million primarily from the absence of a net $6.0 million of repayments under the revolving credit facility in the 2025 period.

The Company’s future capital requirements will depend on numerous factors, including our future capital expenditure requirements;

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the effectiveness of customers’ activities and arrangements;

demand for redemption of the Redeemable Convertible Preferred Stock and payment of the accrued and unpaid liquidation preference on shares of the Convertible Preferred Stock, if required;

any redemptions of the Redeemable Convertible Preferred Stock and payment of the accrued and unpaid liquidation preference on shares of the Convertible Preferred Stock, if required;

payments required under the Term Loan Credit Facility and Revolving Credit Facility;

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There can be no assurance that additional funds, if required, will be available to the Company on favorable terms, if at all.

The Company’s principal sources of liquidity consist of its existing cash, cash generated by operations (if any), proceeds from the sale of certain excess equipment, and availability under its Revolving Credit Facility.

The Company’s principal sources of liquidity consist of its existing cash, any additional cash generated by operations, and availability under its Revolving Credit Facility.

The Company expects these sources will be sufficient to finance its current operational and capital requirements for at least the next twelve months.

There is no assurance that our cash, cash generated from operations, if any, and available borrowing under the Revolving Credit Facility will be sufficient to fund our anticipated capital needs and operating expenses, particularly if we do not generate revenues in the amounts currently anticipated or if our operating costs are greater than anticipated.

Cash obligations relating to Series A Redeemable Convertible Preferred Stock

On January 9, 2023, the Company issued 38,750 shares of Series A Convertible Preferred Stock, par value $0.001 per share, that accrues dividends and that is, in certain cases, redeemable at the option of the holder as discussed further below.

Cash obligations relating to Redeemable Convertible Preferred Stock

On January 9, 2023, the Company issued 38,750 shares of Redeemable Convertible Preferred Stock for a purchase price of $1,000 per share (the stated value) and gross proceeds of $38.8 million.

The Redeemable Convertible Preferred Stock accrues dividends and is redeemable at the option of the holder as discussed further below.

The holders of Redeemable Convertible Preferred Stock are entitled to dividends at a rate of 7.5% per annum, or $75 per share, payable in-kind and compounding quarterly.

The holders are also entitled to participate in dividends declared or paid on the Common Stock on an as-converted basis.

At September 30, 2025, there were $0.9 million of dividends in arrears that had not yet been paid-in-kind in the form of additional shares of Redeemable Convertible Preferred Stock, representing $12.50 per preferred share.

The Redeemable Convertible Preferred Stock is redeemable by the holders after the earlier of June 29, 2026 or the termination or waiver of the restriction on cash dividends and/or redemptions that is set forth in the Company’s credit agreements.

At March 31, 2026 , there were $0.9 million of dividends in arrears that had not yet been paid-in-kind in the form of additional shares of Redeemable Convertible Preferred Stock, representing $18.75 per preferred share.

Each holder of outstanding shares of Redeemable Convertible Preferred Stock has the right to require the Company to redeem all or part of such holder’s outstanding Redeemable Convertible Preferred Stock beginning on June 29, 2026.

To make such cash redemption payments the Company would be required to obtain a consent to such cash redemption payments or waiver of the restriction on cash dividends and/or redemptions set forth in each of the Company’s credit agreements.

To the extent consents or waivers are not obtained under each of the Company’s credit agreements, the Company would be in breach thereof if such payments in cash were made.

The redemption price for each share of Redeemable Convertible Preferred Stock is an amount equal to its liquidation preference.

As of September 30, 2025 and May 25, 2025, the aggregate liquidation preference of the Redeemable Convertible Preferred Stock was $47.5 million and $46.3 million, respectively.

Lifecore’s internally generated cash is not expected to be sufficient to fund all or any significant portion of the Series A liquidation preference and Lifecore is considering its financing alternatives, which would be dependent upon the amount of any redemptions and may include supplementing any cash generated from operations or borrowing under its existing credit facilities with other financing transactions such as equity financing, debt financing, collaborations, strategic alliances or licensing arrangements, or other means.

As of March 31, 2026 and December 31, 2025, the aggregate liquidation preference of the Redeemable Convertible Preferred Stock was $49.3 million and $48.4 million, respectively.

The Company estimates that the accrued and unpaid liquidation preference for all such shares of Redeemable Convertible Preferred Stock, assuming no earlier conversions or redemptions, will be $50.2 million on June 29, 2026.

If the Company does not redeem all shares of Redeemable Convertible Preferred Stock that are submitted for redemption, we must pay the holder cash interest at a rate of 1% per month (equivalent to 12% per annum) in respect of that holder’s unredeemed shares of Redeemable Convertible Preferred Stock until paid in full.

Lifecore’s internally generated cash is not expected to be sufficient to fund all or any significant redemptions of the Redeemable Convertible Preferred Stock.

Lifecore’s financing alternatives would be dependent upon the amount of any redemptions and may include supplementing any cash generated from operations and borrowing under its existing credit facilities with financing transactions such as equity financing, debt financing, collaborations, strategic alliances or licensing arrangements, or other means.

In November 2025, the Company paid an aggregate amount of $4.7 million to the holders of the Redeemable Convertible Preferred Stock in full satisfaction of the outstanding registration delay fees.

See “Part I, Item 1.

Note 10 – Equity ” in this Quarterly Report on Form 10-Q for a description of this obligation.

Contractual and other cash obligations

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– Debt” elsewhere in this Quarterly Report on Form 10-Q for a description of the terms of outstanding indebtedness, including the Term Loan Credit Facility and Revolving Credit Facility, which is incorporated herein by reference.

As of September 30, 2025 the Company had $179.6 million in borrowings outstanding under the Term Loan Credit Facility at an effective annual interest rate of 20.9%, which includes the amortization of the debt discount.

As of March 31, 2026 the Company had $188.6 million in borrowings outstanding under the Term Loan Credit Facility at an effective annual interest rate of 20.9%, which includes the amortization of the debt discount.

The stated annual interest rate is 10%, which is payable-in-kind until May 2026, following which interest is payable at a fixed rate of 3% per annum in cash with the remainder payable-in-kind.

The obligations under the Term Loan Credit Facility mature on May 22, 2029.

Interest paid-in-kind under the Term Loan Credit Facility for the three months ended September 30, 2025 was $4.4 million.

As of September 30, 2025, the Company had no borrowings outstanding under the Revolving Credit Facility.

The Company repaid $2.5 million of borrowings in June 2025, and this repayment was a condition to the Company being able to access any other borrowings under the Revolving Credit Facility.

Interest paid-in-kind under the Term Loan Credit Facility for the three months ended March 31, 2026 was $4.5 million.

As of March 31, 2026, the Company had no outstanding borrowings under the Revolving Credit Facility.

The obligations under the Revolving Credit Facility mature on November 26, 2027.

Interest paid under the Revolving Credit Facility for the three months ended September 30, 2025 was negligible.

Interest paid under the Revolving Credit Facility for the three months ended March 31, 2026 was negligible.

Critical accounting estimates

There have been no material changes to the Company’s critical accounting estimates from those disclosed in the Company’s 2025 Annual Report.

For a discussion of our critical accounting estimates, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Use of Estimates” in Part II, Item 7 of the Company’s 2025 Annual Report.

There have been no material changes to the Company’s critical accounting estimates from those disclosed in the Company’s 2025 Transition Report.

Quantitative and qualitative disclosures about market risk

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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