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- **Revenue Growth**: EBITDA up 20% YoY to $1.4 million despite macroeconomic uncertainty.
- **M&A Focus**: 75% of capital allocated to strategic acquisitions, $7.5M share buyback authorization.
- **Debt Reduction**: Completed payoff of $4.1M mortgage, $19.4M cash on hand.
- **Operational Efficiency**: 70%+ transactions under $100k due to large company capital expenditure delays.
- **Portfolio Progress**: 200+ accounts in workout process generating $1.2M interest income.

**【CEO Summary Section】**
- Reported EBITDA of $1.4 million for the quarter, up 20% year-over-year, driven by smaller-scale transactions due to a wait-and-see economy among larger companies.
- Highlighted progress on M&A strategy, focusing on accretive, operationally independent businesses with scalable processes.
- Noted strong balance sheet positioning ($66.5 million shareholders' equity) and completion of new San Diego facility.
- Emphasized long-term growth through lean manufacturing trends and regional bank asset liquidations.

**【CFO Financial Commentary】**
- Consolidated operating income of $1.3 million (down 13% YoY) with Industrial Assets division up 29% to $900,000 and Financial Assets down 11% to $1.6 million.
- Adjusted EBITDA of $1.6 million (down 16% YoY) and net income of $600,000 ($0.02 per share) due to tax adjustments.
- Cash balance of $19.4 million with $12.6 million net available cash post-payables.
- Completed payoff of ALT note and reduced debt to $4.1 million mortgage on new headquarters.
- Authorized $7.5 million share repurchase program but prioritizing M&A execution.

**【Q&A Key Highlights】**
- Capital allocation: 75% focus on M&A vs. 25% potential share buybacks, with $7.5M repurchase authorization.
- Industrial Assets trends: 70%+ of transactions under $100k due to large companies delaying capital expenditures.
- Heritage Capital progress: 200+ accounts in workout process with $1.2 million interest income generated.
- Debt reduction: Paid down $2.2 million of ALT note in Q3, completing full payoff in Q4.
- Liquidity: $10 million undrawn credit facility supporting M&A pipeline.


Heritage Global Inc. (HGBL) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

HGBL

HGBL fundamentals

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