(Bloomberg) — B. Riley Financial Inc. missed the deadline for filing its annual report for a third year in a row, delaying its to return to a normal schedule as the firm deals with the aftermath of soured investments.
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The delay stems from the impact of discontinued operations on presentations of results from prior years, as well as efforts to finalize impairment charges for goodwill and intangible assets and the provision for income taxes, B. Riley said in a filing with the U.S. Securities and Exchange Commission.
The company expects to produce the missing report “as promptly as practical.” B. Riley caught up on its overdue quarterly filings just last month, putting to rest a threat from Nasdaq to delist the shares, but those efforts contributed to the delay for the full-year report, B. Riley said.
B. Riley has struggled to value its assets amid writedowns on several investments, most notably a stake in Franchise Group Inc. as the retailer of furniture, vitamins and pet supplies collapsed into bankruptcy last year. Earlier this month, the company carved out its investment-banking subsidiary as an independent business. B. Riley’s stock, which briefly traded above $40 a share last year, now hovers under $5.
Previous filings have included disclosure of material weaknesses in B. Riley’s reporting, and a US inquiry into B. Riley’s relations with Brian Kahn, the former head of Franchise Group and an ex-business partner of Chairman Bryant Riley.
The latest delay wasn’t a complete surprise, with Chief Financial Officer Phillip Ahn mentioning the possibility of seeking an extension during the firm’s March 3 earnings call while repeating prior vows “to resume our normal quarterly filing cadence” this year. The annual report carries more weight than the overdue quarterly data because the results are audited, and lenders sometimes can declare a default if a specified report misses a deadline.
Timely reporting was one of the tripwires in B. Riley’s old loan package arranged by Nomura Holdings Inc., and it’s still required in a new financing package from Oaktree Capital Management that replaced Nomura earlier this year. The Oaktree loan, however, cuts B. Riley some slack by saying that financial statements for 2024 will be considered timely if a draft is delivered by March 31.
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