Business Context and Reporting Period
Company: GPGI, Inc. (formerly CompoSecure, Inc.)
Filing Type: Form 10-K (Annual Report)
Period: Fiscal year ended December 31, 2025
Reporting Status: Accelerated Filer; NYSE Ticker: GPGI (rebranded Jan 2026)
GPGI operates as a permanent capital platform managing high-quality businesses through Resolute Holdings Management, Inc. As of the reporting date, the Company's operations consisted primarily of the CompoSecure business (premium metal payment cards and secure authentication). The Company deconsolidated its operating subsidiary, GPGI Holdings, L.L.C. ("Holdings"), effective February 28, 2025, following a spin-off of Resolute Holdings. Consequently, Holdings is now accounted for using the equity method. The Company completed the acquisition of Husky Technologies Limited (Husky) on January 12, 2026, which is not reflected in the 2025 financial results.
Key Financial Metrics
Revenue and Profitability (GAAP):
- Net Sales: $59.8 million (2025) vs. $420.6 million (2024). The 86% decrease is due to the deconsolidation of Holdings; consolidated sales for Holdings post-spin-off were $402.2 million.
- Gross Profit: $28.7 million (2025) vs. $219.2 million (2024). Gross margin decreased from 52% to 48%.
- Net Loss: $136.0 million (2025) vs. Net Loss of $83.2 million (2024).
- Operating Loss: $13.7 million (2025) vs. Operating Income of $107.6 million (2024).
- Earnings in Equity Method Investment: $128.8 million (2025), representing the Company's share of Holdings' net income post-spin-off.
Non-GAAP Measures (Adjusted EBITDA):
- Adjusted EBITDA: $171.8 million (2025) vs. $151.4 million (2024).
- Adjusted Net Income: $120.8 million (2025) vs. $98.2 million (2024).
Liquidity and Capital Resources:
- Cash and Cash Equivalents: $114.6 million (Company) and $157.0 million (Holdings) as of Dec 31, 2025.
- Debt: Holdings had $186.3 million in total debt principal outstanding as of Dec 31, 2025. The Company had no direct debt on its balance sheet.
- Equity: Total Stockholders' Equity was $243.1 million as of Dec 31, 2025.
Material Changes vs. Prior Period
- Deconsolidation of Holdings: The most significant change was the shift from consolidation to equity method accounting for Holdings effective February 28, 2025. This resulted in a dramatic reduction in reported GAAP revenue and operating income, as Holdings' results are now captured in a single line item ("Earnings in equity method investment").
- Non-Cash Expenses: Other expenses increased to $212.1 million in 2025, driven primarily by $208.1 million in non-cash mark-to-market adjustments related to warrant and earnout liabilities.
- Income Tax Expense: Increased to $39.0 million in 2025 from $2.2 million in 2024, largely due to the Company becoming subject to tax on 100% of Holdings' taxable income following the Tungsten Transactions and a taxable gain on the Spin-Off.
- Warrant Redemption: All outstanding public warrants were redeemed or exercised in late 2025, eliminating the warrant liability on the balance sheet.
Guidance, Outlook, and Risks
Outlook and Recent Developments:
- Husky Acquisition: Completed on January 12, 2026, for approximately $4.976 billion. This transaction significantly expands the Company's scale and diversifies its operations into injection molding equipment.
- Refinancing: On January 14, 2026, Holdings refinanced approximately $2.1 billion of indebtedness assumed in the Husky transaction, including $900 million in senior secured notes and a $1.2 billion term loan.
- Dividends: A quarterly cash dividend of $0.0025 per share was declared in February 2026.
Key Risks and Contingencies:
- Management Agreements: The Company relies heavily on Resolute Holdings for management services under 10-year agreements. Resolute has substantial influence over strategy and operations, and the agreements do not create a fiduciary duty to the Company.
- Tax Receivable Agreement (TRA): The Company is obligated to pay 90% of realized tax benefits to TRA parties. The liability totaled $271.4 million as of Dec 31, 2025, with significant future payment obligations.
- Cybersecurity: Risks related to data breaches and the security of the Arculus digital asset platform. A past ransomware incident at Husky (March 2023) resulted in a payment to the threat actor.
- Customer Concentration: CompoSecure's two largest customers (JPMorgan Chase and American Express) represented approximately 55% of net sales in 2025.
- Regulatory Risks: Uncertainty regarding digital asset regulations (Arculus) and potential tariffs on imported raw materials.
Investor Verification Checklist
- Deconsolidation Impact: Verify the reconciliation between GAAP Net Loss and Adjusted EBITDA to understand the true operating performance of the underlying businesses versus the holding company structure.
- Husky Integration: Monitor the integration progress and financial impact of the Husky acquisition, which closed after the reporting period but significantly alters the capital structure and risk profile.
- TRA Liability: Assess the cash flow implications of the $271.4 million Tax Receivable Agreement liability and the Company's ability to fund these payments from tax savings.
- Customer Concentration: Evaluate the risk associated with the top two customers comprising 55% of CompoSecure's revenue.
- Debt Covenants: Review the terms of the new $2.1 billion debt facility established in January 2026 and the Company's compliance with financial covenants.