Business Context and Reporting Period
This Form 8-K is filed by B. Riley Financial, Inc. (RILY) on April 1, 2025, covering events occurring through April 4, 2025. The filing addresses material impairments related to a subsidiary, a delisting notice from Nasdaq due to a delayed 10-K filing, and the completion of a strategic divestiture in its Wealth Management division.
Key Financial Metrics and Events
- Impairment Charges: Estimated goodwill and intangible asset impairments for Nogin Commerce, LLC range from $68 million to $74 million for the year ended December 31, 2024.
- Divestiture Proceeds: Completed sale of a portion of the traditional Wealth Management business to Stifel Financial Corp. for $26.0 million in cash.
- Assets Under Management (AUM): Post-transaction Wealth Management AUM stands at approximately $15 billion, managed by approximately 240 financial advisors.
- Subsidiary Assets: Nogin Commerce assets transferred to an assignee were valued at approximately $9 million as of December 31, 2024.
Material Changes and Operational Updates
- Nogin Commerce Restructuring: On March 31, 2025, Nogin signed a Deed of Assignment for the Benefit of Creditors. The Company no longer controls or owns Nogin's assets, and its results will no longer be consolidated in future financial statements.
- Wealth Management Sale: The sale to Stifel involved 36 financial advisors representing $4.0 billion in AUM. This reduces the total advisor count and AUM from pre-transaction levels.
- Reporting Delay: The Company is currently delinquent in filing its Annual Report on Form 10-K for the year ended December 31, 2024.
Guidance, Risks, and Contingencies
- Nasdaq Delisting Risk: The Company received a notice from Nasdaq on April 3, 2025, citing non-compliance with Listing Rule 5250(c)(1) due to the late 10-K filing. The Company has 60 days (until June 2, 2025) to submit a compliance plan. If accepted, it may have up to 180 days from the original due date (until September 29, 2025) to file the report.
- Impairment Drivers: The impairment of Nogin was driven by challenges in executing growth plans, impacting current and projected operating results.
- Management Commentary: Management states it is working diligently to complete the Annual Report and file it as promptly as possible to regain compliance.
Investor Verification Checklist
- Verify the final approved impairment charge amount in the upcoming Form 10-K to confirm if it falls within the $68 million to $74 million estimate.
- Monitor the Company's submission of a compliance plan to Nasdaq by June 2, 2025, to assess the risk of delisting.
- Confirm the filing date of the Form 10-K for the year ended December 31, 2024, to ensure it meets the extended deadline of September 29, 2025.
- Review the impact of the Nogin divestiture on future revenue streams and the integration of remaining Wealth Management operations.