Sadot Group Inc. 10-Q

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Preliminary Note The following Management’s Discussion and Analysis (“MD&A”), prepared as of November 19, 2025, should be read in conjunction with the Unaudited Condensed Consolidated Financial Statements of Sadot Group Inc. ("Sadot Group"), for the three and nine months ended September 30, 2025, together with the audited financial statements of the Company for the year ended December 31, 2024 and the accompanying MD&A for that fiscal year appearing in our Annual Report on 2024 Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 11, 2025. Unless otherwise indicated or the context otherwise requires, all references to the terms “Company,” “company,” "Sadot", “we,” “us,” “our”, “Group” and similar terms refer to Sadot Group Inc., together with its consolidated subsidiaries. Our website address is http://sadotgroupinc.com . The information on, or that can be accessed through, our website is not part of this Report. The SEC also maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Our filings with the SEC are also available to the public through the SEC’s website at www.sec.gov . This MD&A is the responsibility of management. Prior to its release, the Company’s Board of Directors (the “Board”) approved this MD&A on the Audit Committee’s recommendation. The Company presents its financial statements in U.S. Dollars. Amounts in this MD&A are stated in U.S. Dollars unless otherwise indicated. Forward-Looking Statements This Report contains forward-looking statements as defined in the federal securities laws. Forward-looking statements generally relate to future events or our future financial or operating performance. These forward-looking statements are not guarantees of future performance, conditions, or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside of Sadot Group Inc's management’s control. The words “may,” “will,” “expect,” “believe,” “anticipate,” “project,” “plan,” “forecast,” “model,” “proposal,” “should,” “may,” “intend,” “estimate,” and “continue,” and similar expressions (or the negative versions of such words or expressions), are intended to identify forward-looking statements. These forward-looking statements include, without limitation, information concerning Sadot’s possible or assumed future results of operations, business strategies, debt levels, competitive position, industry environment and possible growth opportunities . Such statements should be read in conjunction with the discussion of liquidity, capital resources, and management’s plans contained elsewhere in this Report, including the disclosure regarding substantial doubt about the Company’s ability to continue as a going concern. We caution you that these statements are not guarantees of future performance or events and are subject to a number of uncertainties, risks and other influences, many of which are beyond our control, which may influence the accuracy of the statements and the projections upon which the statements are based. Reference is made to “Factors That May Affect Future Results and Financial Condition” in this Item 2 for a discussion of some of the uncertainties, risks and assumptions associated with these statements. OVERVIEW Sadot Group Inc. is our parent company and is headquartered in Burleson, Texas. In late 2022, Sadot Group began a transformation from a U.S.-centric restaurant business into a global organization focused on the Agri-Foods supply-chain. As of September 30, 2025, Sadot Group consisted of 1 distinct operating unit and 1 discontinued operations. Sadot LLC (“Sadot Agri-Foods”): Sadot Group’s largest operating unit is a global Agri-Foods company engaged in farming, commodity trading and shipping of food and feed (e.g., soybean meal, wheat and corn) via dry bulk cargo ships across the globe. Sadot Agri-Foods competes with the ABCD commodity companies (ADM, Bunge, Cargill, Louis-Dreyfus) as well as many regional organizations. Sadot Agri-Foods operates, through a majority owned subsidiary, a roughly 5,000 acre crop producing farm in Zambia with a focus on major commodities such as wheat, soy and corn alongside high-value tree crops such as avocado and mango. Sadot Agri-Foods was formed as part of the Company’s diversification strategy to own and operate, through its subsidiaries, the business lines throughout the food supply chain. Sadot Agri-Foods seeks to diversify over time into a sustainable and forward-looking global agri-foods company. Following the financial performance in Q3 the management are in active discussions with the Board on alternatives to address this situation. All options are being assessed. The management continue to focus on monetizing the current assets of the Trading business as efficiently as possible. It should be highlighted that the risk of future impairments on current assets is a possibility in Q4. 54 Table of Contents Sadot Restaurant Group, LLC ("Sadot Food Services"): has three unique “healthier for you” concepts, including two fast casual restaurant concepts, Pokémoto and Muscle Maker Grill, plus one subscription-based fresh prep meal concept, SuperFit Foods. SuperFit Foods was sold in August 2024. This entire operating segment was identified as held for sale. Please see Note 4 – Assets held for sale and Note 5 – Discontinued operations for further details. Key Financial Definitions We review a number of financial and operating metrics, including the following key metrics and non-GAAP measures, to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions. Governmental and other economic factors affecting our operations may vary. Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 $’000 $’000 $’000 $’000 Commodity sales 272 200,906 246,778 480,706 Other revenues 17 — 69 — Cost of goods sold (6,630) (193,247) (242,189) (464,448) Gross profit / (loss) (6,341) 7,659 4,658 16,258 Depreciation and amortization expenses (22) (49) (76) (232) Stock-based expenses (584) (1,713) (2,431) (4,430) Sales, general and administrative expenses (7,388) (3,424) (13,240) (6,518) Income / (loss) from operations (14,335) 2,473 (11,089) 5,078 EBITDA (14,351) 2,858 (10,413) 6,288 EBITDA attributable to Sadot Group Inc. (14,278) 2,927 (10,119) 6,457 Our key business and financial metrics are explained in detail below. Revenues Our revenues are derived from Commodity sales. Revenues from commodity sales have declined substantially in Q3. The business has experienced significant trading difficulties around capital to support new trades, disputes on settlement of existing trades and a number of legal disputes on historic trades. As mentioned above there is an ongoing board review of the business model that will conclude in Q4. Impairments on assets of the Trading business cannot be excluded in Q4 Cost of Goods Sold Cost of goods sold includes commodity costs, labor, rent and other operating expenses. Reclassification During the three and nine months ended September 30, 2025, the Company reclassified gains previously recognized in Other income related to the fair value remeasurement of certain financial instruments into Cost of goods sold ("COGS"). The reclassification was made to better reflect the nature and function of these instruments, which are economically linked to the Company’s inventory procurement, sales activities and to be consistent with our competitors. Management determined that presenting the related gains in COGS more accurately reflects the impact of these instruments on the Company’s gross margin and provides more decision-useful information to financial statement users. This change in presentation had no impact on net income, total comprehensive income, or earnings per share for the period. Depreciation and Amortization Expenses Depreciation and amortization expenses primarily consist of the depreciation of property and equipment. 55 Table of Contents Stock-Based Expenses Stock-based expenses include all expenses that are paid with stock. This includes stock-based consulting fees due to Aggia and other consultants, stock compensation paid to our board of directors, and stock compensation paid to employees. The consulting fees due to Aggia are related to ongoing Sadot Agri-Foods and expansion of the global agri-foods commodities business. Based on the initial Services Agreement with Aggia LLC FZ, a Company formed under the laws of United Arab Emirates (“Aggia”), the consulting fees were calculated at approximately 80.0% of the Net Income generated by Sadot Agri-Foods through March 31, 2023. As of April 1, 2023, the consulting agreement was amended to calculate consulting fees on 40.0% of the Net income generated by Sadot LLC. Aggia waived the consulting fee of 40% on Net income generated by Sadot LLC for the three months ended September 30, 2025. Stock-based expenses were $0.6 million and $1.7 million, for the three months ended September 30, 2025 and 2024 and $2.4 million and $4.4 million, for the nine months ended September 30, 2025 and 2024, respectively, and are recorded in the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss). Sales, General and Administrative Expenses Sales, general and administrative expenses include expenses associated with corporate and administrative functions that support our operations, including wages, benefits, travel expense, legal and professional fees, training, investor relations and other corporate costs. We incur incremental Sales, general and administrative expenses as a result of being a publicly listed company on the NASDAQ capital market. Other (Expense) / Income Total Other (expense) / income listed below the Loss from operations in the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss) consists of Change in fair value of stock-based compensation, loss on debt extinguishment and Interest expense, net. Loss on debt extinguishment Loss on debt extinguishment consist of the loss related to the exchange of stock for debt repayment, which is calculated using the variance between the agreed upon price per share of stock and the fair value of the stock on the date of the exchange and the gain recognized due to writing off accounts payable that have passed the statue of limitations and no longer deemed payable. Income Tax Benefit / (Expense) Income tax benefit / (expense) represent federal, state and local current and deferred income tax expense. Net Income (Loss) Attributable to Non-controlling Interests Net loss attributable to non-controlling interests were $0.1 million and $0.1 million for the three months ended September 30, 2025 and 2024, respectively. and $0.3 million and $0.2 million for the nine months ended September 30, 2025 and 2024, respectively. During the year ended December 31, 2023 the Company created a joint-venture in which the Company has a 70% interest and the third-party equity ownership has a 30% Non-controlling interest. Non-GAAP Measures EBITDA and EBITDA Margin are non-GAAP measures. We define EBITDA as Net loss, adjusted for depreciation, amortization, interest income / (expense), and income taxes. We believe that EBITDA and EBITDA Margin, (collectively, the “Non-GAAP Measures”) are useful metrics for investors to understand and evaluate our operating results and ongoing profitability because they permit investors to evaluate our recurring profitability from our ongoing operating activities. EBITDA and EBITDA Margin, have certain limitations, and you should not consider them in isolation or as a substitute for analysis of our results of operations as reported under U.S. GAAP. We caution investors that amounts presented in accordance with our definitions of any of the Non-GAAP Measures may not be comparable to similar measures disclosed by other issuers, because some issuers calculate certain of the Non-GAAP Measures differently or not at all, limiting their usefulness as direct comparative measures. 56 Table of Contents Reconciliations of EBITDA and Other Non-GAAP Measures The following table presents a reconciliation of EBITDA from the most comparable U.S. GAAP measure, Net income and the calculations of the Net income Margin and EBITDA Margin for the three and nine months ended September 30, 2025 and 2024: Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 $’000 $’000 $’000 $’000 Net income / (loss) (15,262) 1,094 (14,156) 3,099 Adjustments to EBITDA: Depreciation and amortization expenses 22 49 76 232 Interest expense, net 887 1,712 3,665 2,948 Income tax expense 2 3 2 9 EBITDA (14,351) 2,858 (10,413) 6,288 EBITDA attributable to non-controlling interest 73 69 294 169 EBITDA attributable to Sadot Group Inc. (14,278) 2,927 (10,119) 6,457 Gross profit / (loss) (6,341) 7,659 4,658 16,258 Gross profit / (loss) attributable to Sadot Group Inc. (6,268) 7,728 4,952 16,427 Net income/ (loss) margin attributable to Sadot Group Inc. (5281.0) % 0.5 % (5.7) % 0.6 % EBITDA margin attributable to Sadot Group Inc. (4940.5) % 1.5 % (4.1) % 1.3 % 57 Table of Contents Unaudited Condensed Consolidated Results of Operations - Three Months Ended September 30, 2025 Compared to the Three Months Ended September 30, 2024 The following table represents selected items in our Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss) for the three months ended September 30, 2025 and 2024, respectively: Three Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Commodity sales 272 200,906 (200,634) (99.9) % Other revenues 17 — 17 NM Cost of goods sold (6,630) (193,247) 186,617 (96.6) % Gross profit / (loss) (6,341) 7,659 (14,000) (182.8) % Depreciation and amortization expenses (22) (49) 27 (55.1) % Stock-based expenses (584) (1,713) 1,129 (65.9) % Sales, general and administrative expenses (7,388) (3,424) (3,964) 115.8 % Income / (loss) from operations (14,335) 2,473 (16,808) (679.7) % Interest expense, net (887) (1,712) 825 (48.2) % Change in fair value of stock-based compensation — 1,001 (1,001) (100.0) % Income / (loss) for continuing operations before income tax (15,222) 1,762 (16,984) (963.9) % Income tax expense (2) (3) 1 (33.3) % Net income / (loss) for continuing operations (15,224) 1,759 (16,983) (965.5) % Net income / (loss) for discontinued operations (38) (665) 627 (94.3) % Net loss attributable to non-controlling interest 73 69 4 5.8 % Net income / (loss) attributable to Sadot Group Inc. (15,189) 1,163 (16,352) (1406.0) % NM= not meaningful The following table sets forth our results of operations as a percentage of total revenue for each period presented preceding: Three Months Ended September 30, 2025 2024 Commodity sales 94.1 % 100.0 % Other revenues 5.9 % — % Cost of goods sold (2294.1) % (96.2) % Gross profit / (loss) (2194.1) % 3.8 % Depreciation and amortization expenses (7.6) % — % Stock-based expenses (202.1) % (0.9) % Sales, general and administrative expenses (2556.4) % (1.7) % Income / (loss) from operations (4960.1) % 1.2 % Interest expense, net (306.9) % (0.9) % Change in fair value of stock-based compensation — % 0.5 % Income / (loss) for continuing operations before income tax (5267.1) % 0.9 % Income tax expense (0.7) % — % Net income / (loss) for continuing operations (5267.8) % 0.9 % Net income / (loss) for discontinued operations (13.1) % (0.3) % Net loss attributable to non-controlling interest 25.4 % — % Net income / (loss) attributable to Sadot Group Inc. (5255.7) % 0.6 % 58 Table of Contents Gross Profit / (Loss) Three Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Commodity sales 272 200,906 (200,634) (99.9) % Other revenues 17 — 17 NM Cost of goods sold (6,630) (193,247) 186,617 (96.6) % Gross profit / (loss) (6,341) 7,659 (14,000) (182.8) % NM= not meaningful Our gross (loss) profit totaled $6.3 million loss for the three months ended September 30, 2025, compared to $7.7 million profit for the three months ended September 30, 2024. The $14.0 million decrease is primarily attributed to a decrease in Commodity sales partially offset by a decrease in Cost of goods sold. We generated Commodity sales of $0.3 million for the three months ended September 30, 2025, compared to $200.9 million for the three months ended September 30, 2024. This represented a decrease of $200.6 million, This decrease is due to Sadot Agri Foods being unable to enter into additional trades because of lack of working capital. We generated Other revenues of $17.0 thousand for the three months ended September 30, 2025, compared to nil for the three months ended September 30, 2024. This represented an increase of $17.0 thousand, which is attributable to management fees income due to a new management service offered. Cost of goods sold for the three months ended September 30, 2025, totaled $6.6 million compared to $193.2 million for the three months ended September 30, 2024. The $186.6 million or 96.6% change is a direct result of the decrease in sales, reclassifying Sadot Agri-Foods consulting fees to sales, general and administrative cost in 2025 and the reclass of gain on derivative contracts. Depreciation and Amortization Expenses Three Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Depreciation and amortization expenses (22) (49) 27 (55.1) % Depreciation and amortization expenses for the three months ended September 30, 2025, totaled $22.0 thousand compared to $49.0 thousand, for the three months ended September 30, 2024. The $27.0 thousand decrease is mainly attributed to Farm related assets being fully depreciated in 2024. Stock-Based Expenses Three Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Stock-based expenses (584) (1,713) 1,129 (65.9) % Stock-based expenses for the three months ended September 30, 2025, totaled $0.6 million compared to $1.7 million for the three months ended September 30, 2024. The $1.1 million decrease in Stock-based expenses is primarily the result Aggia waiving the 40% of the Net income due to them for consulting fees. Based on the servicing agreement with Aggia, the consulting fees are calculated at approximately 40.0% of the Net income generated by Sadot Agri-Foods. Thi s expense is paid in the vesting in restricted stock that was issued to Aggia in 2024 and this was waived by Aggia for the three months ended June 30, 2025. 59 Table of Contents Sales, General and Administrative Expenses Three Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Sales, general and administrative expenses (7,388) (3,424) (3,964) 115.8 % Sales, general and administrative expenses for the three months ended September 30, 2025, totaled $7.4 million compared to $3.4 million for the three months ended September 30, 2024. The $4.0 million increase was primarily attributable to an increase in consulting fees as a result of reclassifying Sadot Agri-Foods consulting fees from cost of goods sold in 2025. Other Income / (Expense) Three Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Total other income / (expense), net (887) (711) (176) 24.8 % Other income for the three months ended September 30, 2025, totaled $0.9 million expense compared to $0.7 million income for the three months ended September 30, 2024. The $0.2 million decrease in income was primarily attributable to a $1.0 million decrease in income due to the change in fair value of stock-based compensation due to Aggia waiving its consulting fees and vesting of stock and a $0.8 million decrease in interest expense. The following table represents selected items in our Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss) for the three months ended September 30, 2025, by our operating segments: Three Months Ended September 30, 2025 Sadot food service Sadot agri-foods Corporate adj. Consolidated $’000 $’000 $’000 $’000 Commodity sales — 272 — 272 Other revenues — 17 — 17 Cost of goods sold — (6,630) — (6,630) Gross profit / (loss) — (6,341) — (6,341) Depreciation and amortization expenses — (21) (1) (22) Stock-based expenses — — (584) (584) Sales, general and administrative expenses — (5,982) (1,406) (7,388) Loss from operations — (12,344) (1,991) (14,335) Interest expense, net — (424) (463) (887) Loss for continuing operations before income tax — (12,768) (2,454) (15,222) Income tax expense — — (2) (2) Net loss for continuing operations — (12,768) (2,456) (15,224) Loss for discontinued operations, net of income tax (38) — — (38) Net loss (38) (12,768) (2,456) (15,262) Net loss attributable to non-controlling interest — 73 — 73 Net loss attributable to Sadot Group Inc. (38) (12,695) (2,456) (15,189) Total assets 5,016 67,475 472 72,963 60 Table of Contents The following table represents selected items in our Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss) for the three months ended September 30, 2024, by our operating segments: Three Months Ended September 30, 2024 Sadot food service Sadot agri-foods Corporate adj. Consolidated $’000 $’000 $’000 $’000 Commodity sales — 200,906 — 200,906 Cost of goods sold — (193,247) — (193,247) Gross profit — 7,659 — 7,659 Depreciation and amortization expenses — (48) (1) (49) Stock-based expenses — — (1,713) (1,713) Sales, general and administrative expenses — (2,475) (949) (3,424) Income / (loss) from operations — 5,136 (2,663) 2,473 Interest expense , net — (1,267) (445) (1,712) Change in fair value of stock-based compensation — — 1,001 1,001 Income / (loss) for continuing operations before income tax — 3,869 (2,107) 1,762 Income tax expense — — (3) (3) Net income / (loss) for continuing operations — 3,869 (2,110) 1,759 Loss for discontinued operations, net of income tax (665) — — (665) Net income / (loss) (665) 3,869 (2,110) 1,094 Net loss attributable to non-controlling interest — 69 — 69 Net income / (loss) attributable to Sadot Group Inc. (665) 3,938 (2,110) 1,163 Total assets 5,431 164,638 958 171,027 61 Table of Contents Unaudited Condensed Consolidated Results of Operations - Nine Months Ended September 30, 2025 Compared to the Nine Months Ended September 30, 2024 The following table represents selected items in our Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss) for the nine months ended September 30, 2025 and 2024, respectively: Nine Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Commodity sales 246,778 480,706 (233,928) (48.7) % Other revenues 69 — 69 NM Cost of goods sold (242,189) (464,448) 222,259 (47.9) % Gross profit / (loss) 4,658 16,258 (11,600) (71.3) % Depreciation and amortization expenses (76) (232) 156 (67.2) % Stock-based expenses (2,431) (4,430) 1,999 (45.1) % Sales, general and administrative expenses (13,240) (6,518) (6,722) 103.1 % Income / (loss) from operations (11,089) 5,078 (16,167) (318.4) % Interest expense, net (3,665) (2,948) (717) 24.3 % Change in fair value of stock-based compensation 778 2,691 (1,913) (71.1) % Loss on debt extinguishment (192) — (192) NM Income / (Loss) Before Income Tax (14,168) 4,821 (18,989) (393.9) % Income tax expense (2) (9) 7 (77.8) % Net income / (loss) for continuing operations (14,170) 4,812 (18,982) (394.5) % Net income / (loss) for discontinued operations 14 (1,713) 1,727 (100.8) % Net loss attributable to non-controlling interest 294 169 125 74.0 % Net income / (loss) attributable to Sadot Group Inc. (13,862) 3,268 (17,130) (524.2) % NM= not meaningful The following table sets forth our results of operations as a percentage of total revenue for each period presented preceding: Nine Months Ended September 30, 2025 2024 Commodity sales 100.0 % 100.0 % Other revenues — % — % Cost of goods sold (98.1) % (96.6) % Gross profit 1.9 % 3.4 % Depreciation and amortization expenses — % — % Stock-based expenses (1.0) % (0.9) % Sales, general and administrative expenses (5.4) % (1.4) % Income / (loss) from operations (4.5) % 1.1 % Interest expense, net (1.5) % (0.6) % Change in fair value of accrued compensation 0.3 % 0.6 % Loss on debt extinguishment (0.1) % — % Income / (loss) for continuing operations before income tax (5.7) % 1.0 % Income tax expense — % — % Net income / (loss) for continuing operations (5.7) % 1.0 % Net income / (loss) for discontinued operations — % (0.4) % Net loss attributable to non-controlling interest 0.2 % — % Net income / (loss) attributable to Sadot Group Inc. (5.6) % 0.7 % 62 Table of Contents Gross Profit / (Loss) Nine Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Revenues: Commodity sales 246,778 480,706 (233,928) (48.7) % Other revenues 69 — 69 NM Cost of goods sold (242,189) (464,448) 222,259 (47.9) % Gross profit / (loss) 4,658 16,258 (11,600) (71.3) % NM= not meaningful Our gross profit / (loss) totaled $4.7 million for the nine months ended September 30, 2025, compared to $16.3 million for the nine months ended September 30, 2024. The $11.6 million decrease is primarily attributed to a decrease in Cost of goods sold and an increase in other revenues, partially offset by a decrease in Commodity sales. We generated Commodity sales of $246.8 million for the nine months ended September 30, 2025. Commodity sales for the nine months ended September 30, 2024 was $480.7 million. This represented a decrease of $233.9 million, which is primarily due to the Company not taking on trades with unfavorable margins. We generated Other revenues of $0.1 million or the nine months ended September 30, 2025, compared to nil for the nine months ended September 30, 2024. This represented an increase of $0.1 million, which is attributable to management fees income due to a new management service offered. Cost of goods sold for the nine months ended September 30, 2025, totaled $242.2 million. The Cost of goods sold for the nine months ended September 30, 2024 was $464.4 million. The $222.3 million change is primarily due to a direct result of the decrease in sales, reclassifying Sadot Agri-Foods consulting fees to sales, general and administrative cost in 2025 and the reclass of gain on derivative contracts . Depreciation and Amortization Expenses Nine Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Depreciation and amortization expenses (76) (232) 156 (67.2) % Depreciation and amortization expenses for the nine months ended September 30, 2025 totaled $0.1 million compared to $0.2 million, for the nine months ended September 30, 2024. The $0.2 million decrease is mainly attributed to Farm related assets being fully depreciated in 2024. Stock-Based Expenses Nine Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Stock-based expenses (2,431) (4,430) 1,999 (45.1) % Stock-based expenses for the nine months ended September 30, 2025, totaled $2.4 million compared to $4.4 million for the nine months ended September 30, 2024. The $2.0 million decrease in Stock-based expenses is primarily the result Aggia waiving the 40% of the Net income due to them for consulting fees. Based on the servicing agreement with Aggia, the consulting fees are calculated at approximately 40.0% of the Net income generated by Sadot Agri-Foods. Thi s expense is paid in the vesting in restricted stock that was issued to Aggia in 2025 and this was waived by Aggia for the three months ended June 30, 2025 63 Table of Contents Sales, General and Administrative Expenses Nine Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Sales, general and administrative expenses (13,240) (6,518) (6,722) 103.1 % Sales, general and administrative expenses for the nine months ended September 30, 2025 totaled $13.2 million, compared to $6.5 million, for the nine months ended September 30, 2024. The $6.7 million increase was primarily attributable to an increase in consulting fees as a result of reclassifying Sadot Agri-Foods consulting fees from cost of goods sold. Total Other Income, Net Nine Months Ended September 30, Variance 2025 2024 $ % $’000 $’000 $’000 Total other income / (expense), net (3,079) (257) (2,822) 1098.1 % Total other income / (expense), net for the nine months ended September 30, 2025 totaled $3.1 million compared to $0.3 million loss, for the nine months ended September 30, 2024. The $2.8 million decrease in Total other income / (expense), net was attributable to a $0.7 million increase in Interest expense and a $0.2 million increase on Loss on extinguishment of debt, partially offset by a decrease of $1.9 million gain in the Change in fair value of accrued compensation. The following table represents selected items in our Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss) for the nine months ended September 30, 2025 and 2024, by our operating segments: Nine Months Ended September 30, 2025 Sadot food service Sadot agri-foods Corporate adj. Consolidated $’000 $’000 $’000 $’000 Commodity sales — 246,778 — 246,778 Other revenues — 69 — 69 Cost of goods sold — (242,189) — (242,189) Gross profit — 4,658 — 4,658 Depreciation and amortization expenses — (73) (3) (76) Stock-based expenses — — (2,431) (2,431) Sales, general and administrative expenses — (9,444) (3,796) (13,240) Loss from operations — (4,859) (6,230) (11,089) Interest expense, net — (2,116) (1,549) (3,665) Change in fair value of stock-based compensation — — 778 778 Loss on debt extinguishment — — (192) (192) Loss for continuing operations before income tax — (6,975) (7,193) (14,168) Income tax expense — — (2) (2) Net loss for continuing operations — (6,975) (7,195) (14,170) Income for discontinued operations, net of income tax 14 — — 14 Net income / (loss) 14 (6,975) (7,195) (14,156) Net loss attributable to non-controlling interest — 294 — 294 Net income / (loss) attributable to Sadot Group Inc. 14 (6,681) (7,195) (13,862) Total assets 5,016 67,475 472 72,963 64 Table of Contents Nine Months Ended September 30, 2024 Sadot food service Sadot agri-foods Corporate adj. Consolidated $’000 $’000 $’000 $’000 Commodity sales — 480,706 — 480,706 Cost of goods sold — (464,448) — (464,448) Gross profit — 16,258 — 16,258 Depreciation and amortization expenses — (230) (2) (232) Stock-based expenses — — (4,430) (4,430) Sales, general and administrative expenses — (4,052) (2,466) (6,518) Income / (loss) from operations — 11,976 (6,898) 5,078 Interest expense , net — (1,451) (1,497) (2,948) Change in fair value of stock-based compensation — — 2,691 2,691 Income / (loss) for continuing operations before income tax — 10,525 (5,704) 4,821 Income tax expense — — (9) (9) Net income / (loss) for continuing operations — 10,525 (5,713) 4,812 Loss for discontinued operations, net of income tax (1,713) — — (1,713) Net income / (loss) (1,713) 10,525 (5,713) 3,099 Net loss attributable to non-controlling interest — 169 — 169 Net income / (loss) attributable to Sadot Group Inc. (1,713) 10,694 (5,713) 3,268 Total assets 5,431 164,638 958 171,027 Liquidity and Capital Resources Working Capital We measure our liquidity in a number of ways, including the following: As of September 30, 2025 December 31, 2024 $’000 $’000 Cash 581 1,786 Accounts Receivable, net 29,054 18,014 Inventory 154 717 Other current assets (1) 12,864 126,966 Assets held for sale (2) 5,016 5,196 Total current assets 47,669 152,679 Accounts payable and accrued expenses 35,432 28,019 Notes payable, net 11,540 7,390 Other current liabilities (3) 26 94,428 Liabilities held for sale (4) 2,142 2,333 Total current liabilities 49,140 132,170 Working capital (5) (1,471) 20,509 Current ratio (6) 0.97 1.16 (1) Consists of VAT, prepaid expenses, derivative assets, derivative contracts, Notes receivable, current, deposit on farmland and deposit on acquisition. (2) See Note 4 for additional information (3) Consists of Operating lease liability, current, derivative liability, current and derivative contracts (4) See Note 4 for additional information (5) Working Capital is defined as Total current assets less Total current liabilities 65 Table of Contents (6) Current ratio is defined as Total current assets divided by Total current liabilities Availability of Additional Funds Our main financial objectives are to prudently manage financial risk, ensure access to liquidity and minimize cost of capital in order to efficiently finance our business and maintain balance sheet strength. We generally finance our ongoing operations with cash flows generated from operations, borrowings under various credit facilities and term loans. On September 30, 2025, current ratio, which equals Total current assets divided by Total current liabilities, was 0.97, a decrease of 0.19, compared to current ratio of 1.16 on December 31, 2024. On September 30, 2025, working capital deficit, which equals Total current assets less Total current liabilities, was $1.5 million a decrease of $22.0 million, compared to a working capital surplus of $20.5 million on December 31, 2024. The decrease in current ratio and working capital was primarily due to an increase in Accounts receivable and an increase in Accounts payable and accrued expenses partially offset by a decrease in Other current liabilities, a decrease in Other current assets, and a decrease in Assets held for sale. While the Company maintains a base of current assets, including inventories and receivables, the timing and certainty of converting these assets into cash has presented operational challenges and led the business to increase borrowing to cover collection delays. During Q3 the company increased its borrowing by $1.3 million. Subsequent to Q3 the business has entered into further borrowing agreements These are referred to in Note 24 – Subsequent events. These short-term borrowings, together with the equity line of credit, are expected to provide interim credit support. The Company is currently experiencing delays in converting receivables into cash, which has impacted the timing of available liquidity. Management continues to actively manage collections, review credit facilities, and negotiate repayment arrangements with certain creditors to support liquidity requirements. In the event we are required to obtain additional financing—whether through borrowings, private placements, public offerings, or strategic transactions such as mergers or asset sales—there can be no assurance that such efforts will be successful. Failure to obtain adequate funding could require us to sell one or more business lines or assets, enter into a business combination, or reduce or cease operations. Any such transactions, to the extent available, could result in significant dilution to existing shareholders or the loss of their investment in our Company. We will need to raise additional capital. Such additional capital may not be available nor may the terms of such capital be generally acceptable. In addition, any future sale of our equity securities could dilute the ownership and control of your shares and could be at prices substantially below prices at which our shares currently trade. We may seek to increase our cash reserves through the sale of additional equity or debt securities. The sale of convertible debt securities or additional equity securities could result in additional and potentially substantial dilution to our shareholders. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations and liquidity. In addition, our ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all. Any failure to raise additional funds on favorable terms could have a material adverse effect on our liquidity and financial condition. Management has performed a going concern assessment covering a period of twelve months from the issuance date of these unaudited condensed consolidated financial statements. While there is no assurance that existing borrowings and the equity line of credit will provide sufficient funding to support operations for the full assessment period, management believes it remains appropriate to prepare the financial statements on a going-concern basis. Management believes the actions described above, if successfully executed, will provide sufficient liquidity to meet obligations as they become due. However, there can be no assurance that such plans will be realized or that additional financing will be available on acceptable terms. Accordingly, substantial doubt exists about the Company’s ability to continue as a going concern within one year after the date these financial statements are issued. The accompanying unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability or classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty. 66 Table of Contents Sources and Uses of Cash for the Nine Months Ended September 30, 2025 and 2024 For the nine months ended September 30, 2025, Net cash used in operating activities from continuing operation was $7.2 million compared to $1.4 million provided by operating activities for the nine months ended September 30, 2024. Net cash used in operating activities from discontinued operations was $11.0 thousand and Net cash provided by operating activities from discontinued operations was $0.6 million, respectively, for the nine months ended September 30, 2025 and 2024. Our Net cash used for the nine months ended September 30, 2025, was primarily attributable to our Net loss of $14.2 million, adjusted for net non-cash income in the aggregate amount of $9.0 million and $2.1 million of Net cash used by changes in the levels of operating assets and liabilities. Our Net cash provided for the nine months ended September 30, 2024, was primarily attributable to our Net income of $3.1 million, adjusted for net non-cash income in the aggregate amount of $3.2 million and $4.9 million of Net cash used in changes in the levels of operating assets and liabilities. For the nine months ended September 30, 2025, Net cash used in investing activities was nil . For the nine months ended September 30, 2024, Net cash used in investing activities from continuing operations was $1.0 thousand, consisting of $13.0 thousand, which was used in the purchase of property and equipment, partially offset by $12.0 thousand, which was provided by the disposal of property and equipment. Net cash provided by investing activities from discontinued operations was $1.0 million. For the nine months ended September 30, 2025, Net cash provided by financing activities from continuing operations was $6.1 million, consisting of proceeds from notes payable of $12.1 million and proceeds from issuance of common stock of $2.4 million, partially offset by repayments of various other notes payable of $8.4 million. Net cash used in financing activities from discontinued operations was nil and $0.1 million, respectively, for the nine months ended September 30, 2025 and 2024. For the nine months ended September 30, 2024, Net cash used in financing activities was $2.1 million, consisting of repayments of various other notes payable of $6.2 million partially offset by $4.1 million of proceeds from notes payable. Critical Accounting Policies and Estimates Our accounting policies are more fully described in Note 3 – Significant accounting policies to our consolidated financial statements included as part of this Annual Report on Form 10-K. As disclosed in Note 3, the preparation of financial statements in conformity with U.S. GAAP requires management to make substantial judgment or estimation in their application that may significantly affect reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ significantly from those estimates. We believe the following discussion addresses our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require management's most difficult, subjective and complex judgments. Recently Issued Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures (Topic 280). The standard requires incremental disclosures related to reportable segments, including disaggregated expense information and the title and position of the company's chief operating decision maker ("CODM"), as identified for purposes of segment determination. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Entities must adopt the changes to the segment reporting guidance on a retrospective basis. Early adoption is permitted. The adoption of this guidance on December 31, 2024 did not have a material impact on the Company's Consolidated Financial Statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, which focuses on income tax disclosures by requiring public business entities, on an annual basis, to disclose specific categories in the rate reconciliation, provide information for reconciling items that meet a quantitative threshold, and certain information about income taxes paid. The standard is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The amendments should be applied on a prospective basis. Retrospective application is permitted. The adoption of this guidance on December 31, 2024 did not have a material impact on the Company's Consolidated Financial Statements and related disclosures. 67 Table of Contents In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) ("ASU 2024-03"). The standard is intended to enhance transparency of income statement disclosures, primarily through additional disaggregation of relevant expense captions. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim reporting periods within fiscal years beginning after December 15, 2027. Entities can adopt the change prospectively or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the impact of the standard on its consolidated financial statements. In September 2025, the FASB issued ASU No. 2025-07, Derivatives and Hedging and Revenue from Contracts with Customers - Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (“ASC 2025-07”) which applies to all entities that enter into non-exchange-traded contracts with underlyings based on operations or activities specific to one of the parties to the contract. The new guidance excludes from derivative accounting non-exchange-traded contracts with underlyings that are based on operations or activities specific to one of the parties to the contract. ASU 2025-07 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating the impact of the standard on its consolidated financial statements. Seasonality There is a degree of seasonality in the growing cycles, procurement and transportation of crops. The farming industry in general historically experiences seasonal fluctuations in revenues and net income. Typically, the Company has lower sales and net income during the non-harvest seasons and higher sales and net income during the harvest season and as such, must have sufficient working capital to fund its operations at a reduced level. The failure to generate or obtain sufficient working capital during the winter may have a material adverse effect on the Company. Off-Balance Sheet Arrangements We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors. Item 3. Quantitative and Qualitative Disclosures About Market Risk Not applicable.