On March 3, 2025, B. Riley Financial Inc (RILY, Financial) released its 8-K filing detailing preliminary unaudited financial results for the fourth quarter of 2024. The diversified financial services company, which operates across various segments including Capital Markets, Wealth Management, and Financial Consulting, reported an expected net income available to common shareholders ranging from $48 million to $68 million, translating to $1.57 to $2.22 per diluted share.
Company Overview
B. Riley Financial Inc is a diversified financial services company offering a wide array of services such as investment banking, asset disposition, valuation, and capital advisory. The company operates through multiple segments, including Capital Markets, Wealth Management, Financial Consulting, Auction and Liquidation, Communications, and Consumer Products, serving clients in the United States, Canada, and Europe.
Performance and Challenges
The preliminary results indicate a net loss from continuing operations between $178 million and $187 million. This loss is primarily attributed to impairment charges on goodwill and intangible assets, trading losses, and realized and unrealized losses on investments. These challenges highlight the volatility and risks inherent in the financial services industry, particularly in managing investments and asset valuations.
Financial Achievements
Despite the challenges, B. Riley Financial Inc achieved significant milestones, including reducing debt by over $700 million since January 2024. This strategic move allowed the company to retire its Nomura facility, positioning it for future growth. The company's core businesses, particularly B. Riley Securities, ended the year on a strong note, indicating robust operational performance.
Key Financial Metrics
The company's operating adjusted EBITDA from continuing operations is projected to be between $12 million and $14 million. This metric is crucial as it provides insight into the company's operational efficiency and profitability, excluding non-operational expenses. Additionally, income from discontinued operations, primarily from the divestiture of a majority interest in the Great American businesses, is expected to contribute significantly to the net income.
Bryant Riley, Chairman and Co-Chief Executive Officer, stated, “This quarter reflects a demarcation line from managing the losses in our principal investments to moving forward with our core businesses as the primary focus. While we recognize we have work to do, we do believe the worst is behind us and remain confident in the future based on the underlying strength of our core businesses.”
Analysis and Outlook
The preliminary earnings report underscores B. Riley Financial Inc's strategic focus on strengthening its core operations while addressing financial challenges. The reduction in debt and strong performance of B. Riley Securities are positive indicators of the company's resilience and potential for growth. However, the significant net loss from continuing operations highlights the need for continued strategic management and operational adjustments.
Investors and stakeholders will be keenly observing the company's upcoming annual report and investor call for further insights into its financial health and strategic direction. The company's ability to navigate its current challenges and leverage its core strengths will be critical in maintaining investor confidence and achieving long-term growth.
Explore the complete 8-K earnings release (here) from B. Riley Financial Inc for further details.
