Understanding the Impact of RILY Stock Decline on the Company

Following the release of the financial services company’s most recent preliminary earnings data to investors, B. Riley Financial shares declined on Tuesday.

• There is a $14 to $15 net loss per share according to these preliminary data.
• This is because it lost between $435 million and $475 million on net during the quarter.

B. Riley Financial, on the other hand, is acting to guarantee the stability of its balance sheet. This also applies to the dividend’s suspension. Additionally, it plans to refocus on its primary financial services operations.

B. Riley Reports Significant Losses Amid $330 Million Investment Impairment

These losses coincide with the company’s expectation that its $330 million to $370 million investment in Freedom VCM will result in an impairment charge. Additionally, it anticipates receiving a $25 million valuation allowance for deferred income taxes and a $28 million impairment charge from Targus.

Our second quarter results were negatively impacted by non-cash losses, the overwhelming majority of which relate to performance of our investment in Franchise Group, Inc. (“FRG”) and our Vintage Capital loan receivable, which is primarily collateralized by equity interests in FRG. The substantial write-down during the quarter was driven by a confluence of recent events, including the impact of a meaningfully weaker consumer spending environment on FRG’s businesses and its investments.

B. Riley Financial chairman and co-CEO Bryant Riley

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