RHLD

Resolute Holdings Management, Inc. (RHLD) - 10-K Summary

Business Context and Reporting Period

This Annual Report on Form 10-K covers the fiscal year ended December 31, 2025. Resolute Holdings Management, Inc. ("Resolute Holdings") is a management company that provides operating services to GPGI Holdings, L.L.C. (formerly CompoSecure Holdings) and, following a transaction closed in January 2026, Husky Holdings LLC. Resolute Holdings does not own equity in these managed companies but consolidates GPGI Holdings as a Variable Interest Entity (VIE) under ASC 810. The company generates revenue primarily through management fees calculated as a percentage of the managed companies' Adjusted EBITDA.

Key corporate events during the period included a spin-off from GPGI, Inc. on February 28, 2025, and a subsequent transfer of listing from Nasdaq to the New York Stock Exchange in September 2025. The company redomiciled from Delaware to Nevada in March 2026.

Key Financial Metrics (Year Ended Dec 31, 2025)

Note: Consolidated Net Income is largely attributable to non-controlling interests (GPGI Holdings). Resolute Holdings common stockholders reported a net loss due to the elimination of intercompany management fees and specific tax/expense allocations.

Material Changes vs. Prior Period

• Revenue Growth: Net sales increased 10% to $462.1 million, driven by a 16% increase in domestic sales of premium metal payment cards. International sales declined 19% due to lower new program orders.
• Margin Expansion: Gross margin improved to 56% from 52%, attributed to higher volumes, product mix, and operational efficiencies from the Resolute Operating System.
• Expense Increase: Operating expenses rose 26% to $117.0 million, primarily due to incremental salaries, bonuses, and equity-based compensation for new hires at Resolute Holdings.
• Interest Expense Reduction: Other expense decreased 49% to $8.4 million, largely due to the extinguishment of GPGI Holdings' Exchangeable Notes in late 2024.
• Stock Repurchases: The company repurchased 25,304 shares in 2025 at an average price of $162.14 per share, totaling approximately $4.1 million.

Outlook, Risks, and Subsequent Events

Subsequent Events (Husky Transaction): On January 12, 2026, GPGI completed the acquisition of Husky Technologies Limited for approximately $4.976 billion. Resolute Holdings entered into a management agreement with Husky Holdings on terms identical to the CompoSecure agreement. This transaction significantly expands the company's scale and leverage. GPGI Holdings refinanced its debt in January 2026, assuming approximately $2.1 billion in debt and issuing $900 million in Senior Secured Notes.

Liquidity: As of December 31, 2025, Resolute Holdings had $4.4 million in cash and a $5.0 million revolving credit facility (refinanced to $30.0 million in February 2026). GPGI Holdings held $157.0 million in cash and had a $130.0 million revolver available (refinanced to $400.0 million in January 2026).

Key Risks:

• Concentration Risk: Results are substantially dependent on two managed businesses (CompoSecure and Husky). Two customers (JPMorgan Chase and American Express) represented 55% of CompoSecure's net sales in 2025.
• Management Fee Dependency: Revenue is derived solely from management fees based on Adjusted EBITDA; poor performance by managed companies directly reduces Resolute's revenue.
• Regulatory & Cybersecurity: Significant risks exist regarding digital asset regulations (Arculus platform) and cybersecurity threats affecting payment card and authentication solutions.
• Accounting Complexity: The VIE consolidation structure and non-GAAP fee calculations require complex judgments and assumptions.

Investor Verification Checklist

• Fee Calculation: Verify the definition of "Management Agreement Adjusted EBITDA" in the CompoSecure and Husky Management Agreements to understand the revenue base.
• Non-Controlling Interest: Review the allocation of Net Income to non-controlling interests to understand why consolidated net income differs significantly from income attributable to common stockholders.
• Husky Integration: Monitor the integration of Husky Holdings and the impact of the new $2.1 billion debt load on future cash flows and management fee generation.
• Customer Concentration: Assess the stability of relationships with JPMorgan Chase and American Express, which drive the majority of CompoSecure revenue.
• Digital Asset Exposure: Evaluate the regulatory risks associated with the Arculus Cold Storage Wallet and authentication solutions.