Radiant Logistics, Inc: Form 10-Q for the period ended Dec 31, 2025

CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS

This report contains “forward-looking statements” within the meaning set forth in United States securities laws and regulations – that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business, financial performance and financial condition, and often contain words such as “anticipate,” “believe,” “estimates,” “expect,” “future,” “intend,” “may,” “plan,” “see,” “seek,” “strategy,” or “will” or the negative thereof or any variation thereon or similar terminology or expressions. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. We have developed our forward-looking statements based on management’s beliefs and assumptions, which in turn rely upon information available to them at the time such statements were made. Such forward-looking statements reflect our current perspectives on our business, future performance, existing trends and information as of the date of this report. These include, but are not limited to, our beliefs about future revenue and expense levels, growth rates, prospects related to our strategic initiatives and business strategies, along with express or implied assumptions about, among other things: our continued relationships with our strategic operating partners; the performance of our historic business, as well as the businesses we have recently acquired, at levels consistent with recent trends and reflective of the synergies we believe will be available to us as a result of such acquisitions; our ability to successfully integrate our recently acquired businesses; our ability to locate suitable acquisition opportunities and secure the financing necessary to complete such acquisitions; transportation costs remaining in line with recent levels and expected trends; our ability to mitigate, to the best extent possible, our dependence on current management and certain larger strategic operating partners; our compliance with financial and other covenants under our indebtedness; the absence of any adverse laws or governmental regulations affecting the transportation industry in general, and our operations in particular; our ability to continue to respond to macroeconomic factors that have recently had a negative effect on worldwide freight markets; the impact of any health pandemic or environmental event on our operations and financial results; continued disruptions in the global supply chain; higher inflationary pressures particularly surrounding the costs of fuel, labor, and other components of our operations; potential adverse legal, reputational and financial effects on the Company resulting from prior or future cyber incidents and the effectiveness of the Company’s business continuity plans in response to cyber incidents; the commercial, reputational and regulatory risks to our business that may arise as a consequence of our prior inability to remediate a material weakness in our internal control over financial reporting, and the further risks that may arise should we be unable to maintain an effective system of disclosure controls and internal control over financial reporting in the future; and such other factors that may be identified from time to time in our U.S Securities and Exchange Commission (“SEC”) filings and other public announcements including those set forth under the caption “Risk Factors” in Part 1 Item 1A of our Form 10-K for the year ended June 30, 2025. All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the foregoing. Readers are cautioned not to place undue reliance on our forward-looking statements, as they speak only as of the date made. We disclaim any obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

The following discussion and analysis of our financial condition and result of operations should be read in conjunction with the condensed consolidated financial statements and the related notes and other information included elsewhere in this report.

Overview

Radiant Logistics, Inc., and its consolidated subsidiaries (the “Company,” “we” or “us”), is a leading third-party logistics company, providing technology-enabled global transportation and value-added logistics services primarily in the United States, Canada, and Mexico. We service a large, broad, and diversified account base consisting of consumer goods, food and beverage, electronics and high-tech, aviation and automotive, military and government, and manufacturing and retail customers, which is supported by an extensive network of operating locations across North America as well as an integrated international service partner network located in other key markets around the globe. The Company provides these services through a multi-brand network, which includes over 100 operating locations. Included in these operating locations are a number of independent agents, who are also referred to as “strategic operating partners,” that operate exclusively on the Company's behalf, and approximately 30 Company-owned locations. As the operator of a third-party logistics business, the Company has a vast carrier network of asset-based transportation companies, including motor carriers, railroads, airlines and ocean lines in its carrier network. We believe shippers value our services because we are able to objectively arrange the most efficient and cost-effective means, type and provider of transportation service without undue influence caused by the ownership of transportation assets. In addition, our minimal investment in physical assets affords us the opportunity for a higher return on invested capital and generally stronger net cash flows than our asset-based competitors.

Through our operating locations across North America, we offer domestic and international freight forwarding and freight brokerage services, including air, ocean, truckload, less than truckload ("LTL"), and intermodal, which is the movement of freight in trailers or containers by combination of truck and rail. Our primary business operations involve arranging shipments, on behalf of our customers, of materials, products, equipment and other goods that are generally larger than shipments handled by integrated carriers of primarily small parcels, such as FedEx, DHL and UPS. Our services include arranging and monitoring all aspects of material flow activity utilizing advanced information technology systems. We also provide other value-added logistics services, including materials management and distributions ("MM&D"), customs house brokerage ("CHB") and global trade management ("GTM") solutions which complement our core transportation service offering.

The Company expects to grow its business organically and by completing acquisitions of other companies with complementary geographical and logistics service offerings. The Company’s organic growth strategy will continue to focus on strengthening existing and expanding new customer relationships leveraging the benefit of the Company’s technology platform, while continuing its efforts on the organic build-out of the Company’s network of strategic operating partner locations. In addition, as the Company continues to grow and scale its business, the Company believes that it is creating density in its trade lanes, enhances our ability to efficiently source and manage its transportation capacity.

In addition to its focus on organic growth, the Company will continue to search for acquisition candidates that bring critical mass from a geographic and purchasing power standpoint, along with providing complementary service offerings to the current platform. As the Company continues to grow and scale its business, it also remains focused on leveraging its back-office infrastructure and technology systems to drive productivity improvement across the organization.

Impact of Notable External Conditions

Global economic and trade conditions remain uncertain, due to inflationary pressures, tariff and trade policy uncertainty, geopolitical tensions, and shifts in consumer demand, which may adversely affect shipment volumes, pricing dynamics and operating margins, and our overall business and financial results.

Performance Metrics

Our principal source of income is derived from freight forwarding and freight brokerage services we provide to our customers. As a third-party logistics provider, we arrange for the shipment of our customers’ freight from point of origin to point of destination. Generally, we quote our customers a turnkey cost for the movement of their freight. Our price quote will often depend upon the customer’s time-definite needs (first day through fifth day delivery), special handling needs (heavy equipment, delicate items, environmentally sensitive goods, electronic components, etc.), and the means of transport (motor carrier, air, ocean or rail). In turn, we assume the responsibility for arranging and paying for the underlying means of transportation.

Our transportation revenue represents the total dollar value of services we sell to our customers. Our cost of transportation includes direct costs of transportation, including motor carrier, air, ocean, and rail services. Our adjusted gross profit, a non-GAAP financial measure, is gross revenue less the direct cost of transportation and other services (excluding depreciation and amortization, which are reported separately), and is used as an indicator of our ability to source, add value, and resell services provided by third-parties, and is considered by management to be a key performance measure. Adjusted gross profit percentage is adjusted gross profit as a percentage of our total revenue. In addition, management believes measuring its operating costs as a function of adjusted gross profit provides a useful metric, as our ability to control costs as a function of adjusted gross profit directly impacts operating results. We believe that these metrics provide investors with meaningful information to understand our results of operations and the ability to analyze financial and business trends on a period-to-period basis.

Our operating results will be affected as acquisitions occur. Since acquisitions are recorded using the acquisition method of accounting for business combinations, our financial statements will only include the results of operations and cash flows of acquired companies for periods subsequent to the date of acquisition.

Our GAAP-based net income will be affected by non-cash charges relating to the amortization of customer-related intangible assets and other intangible assets attributable to completed acquisitions. Under applicable accounting standards, purchasers are required to allocate the total consideration in a business combination to the identified assets acquired and liabilities assumed based on their fair values at the time of acquisition. The excess of the consideration paid over the fair value of the identifiable net assets acquired is to be allocated to goodwill, which is tested at least annually for impairment. Applicable accounting standards require that we separately account for and value certain identifiable intangible assets based on the unique facts and circumstances of each acquisition. As a result of our acquisition strategy, our net income will include material non-cash charges relating to the amortization of customer-related intangible assets and other intangible assets acquired in our acquisitions. Although these charges may increase as we complete more acquisitions, we believe we will be growing the value of our intangible assets (e.g., customer relationships). Thus, we believe that earnings before interest, income taxes, depreciation and amortization, or EBITDA, is a useful financial measure for investors because it eliminates the effect of these non-cash charges and provides an important metric for our business.

EBITDA is a non-GAAP financial measure of income and does not include the effects of interest, income taxes, and the “non-cash” effects of depreciation and amortization on long-term assets. Companies have some discretion as to which elements of depreciation and amortization are excluded in the EBITDA calculation. We exclude all depreciation charges related to property, technology, and equipment and all amortization charges (including amortization of leasehold improvements). We then further adjust EBITDA to exclude share-based compensation, costs unrelated to our core operations (primarily acquisition and litigation costs), allocation of earnings attributable to noncontrolling interests in subsidiaries, and other non-cash charges. While management considers EBITDA and adjusted EBITDA useful in analyzing our results, it is not intended to replace any presentation included in our condensed consolidated financial statements. The Company’s financial covenants with its lenders define an adjusted EBITDA as a key component of its covenant calculations. The Company’s ability to grow adjusted EBITDA is closely monitored by management as it’s directly tied to financial borrowing capacity and is a frequent point of discussion with its investors as well as the Company’s earnings calls.

Our operating results are also subject to seasonal trends when measured on a quarterly basis. The impact of seasonality on our business will depend on numerous factors, including the markets in which we operate, holiday seasons, consumer demand, and economic conditions. Since our revenue is largely derived from customers whose shipments are dependent upon consumer demand and just-in-time production schedules, the timing of our revenue is often beyond our control. Factors such as shifting demand for retail goods and/or manufacturing production delays could unexpectedly affect the timing of our revenue. As we increase the scale of our operations, seasonal trends in one area of our business may be offset to an extent by opposite trends in another area. We cannot accurately predict the timing of these factors, nor can we accurately estimate the impact of any particular factor, and thus we can give no assurance any historical seasonal patterns will continue in future periods.

Results of Operations

Three months ended December 31, 2025 and 2024 (unaudited)

The following table summarizes revenues, cost of transportation and other services, and adjusted gross profit by reportable operating segments for the three months ended December 31, 2025 and 2024:

(In thousands)

(1) Adjusted gross profit is revenues less the cost of transportation and other services.

Transportation revenue was $217.8 million and $252.1 million for the three months ended December 31, 2025 and 2024, respectively. The decrease of $34.3 million, or 13.6% is primarily attributable to meaningful project charter revenues in the prior year period, offset by incremental revenues generated from current and prior year acquisitions. Adjusted transportation gross profit was $54.2 million and $56.4 million for the three months ended December 31, 2025 and 2024, respectively. Net transportation margins increased from 22.4% to 24.9%, primarily due to project charter revenues in the prior year period, which have lower gross profit margin characteristics than other service levels.

Value-added services revenue was $14.3 million and $12.5 million for the three months ended December 31, 2025 and 2024, respectively. The increase is driven by higher volumes and incremental revenue from expanded warehouse operations in Canada. Adjusted value-added services gross profit was $9.2 million for the three months ended December 31, 2025, compared to $6.9 million for the comparable prior year period. Adjusted value-added services gross profit percentage increased from 55.2% to 64.7%.

The following table provides a reconciliation for the three months ended December 31, 2025 and 2024 of adjusted gross profit to gross profit, the most directly comparable GAAP measure:

(In thousands)

29

The following table compares condensed consolidated statements of comprehensive income data by reportable operating segments for the three months ended December 31, 2025 and 2024:

(In thousands)

(1) Adjusted gross profit is revenues less the cost of transportation and other services.

Operating partner commissions increased $1.0 million, or 5.3%, to $20.3 million for the three months ended December 31, 2025. The increase is primarily due to an increase of adjusted gross profit generated from our strategic operating partners, partially offset by the conversions of strategic operating partners to Company-owned locations who earned commissions in the prior year. As a percentage of adjusted gross profit, operating partner commissions increased 153 basis points to 32.0% from 30.5% for the three months ended December 31, 2025 and 2024, respectively, as a result of a higher mix of gross margin generated from strategic operating partners compared to Company-owned locations due to the project charter revenues in the prior year period.

Personnel costs increased $3.0 million, or 15.5%, to $22.6 million for the three months ended December 31, 2025. The increase is primarily due to an increase in headcount from recent acquisitions and the share-based compensation expense in the period compared to a benefit in the prior year period, offset by decreases in sales commissions and bonus expenses. As a percentage of adjusted gross profit, personnel costs increased 471 basis points to 35.6% from 30.9% for the three months ended December 31, 2025 and 2024, respectively.

Selling, general and administrative (“SG&A”) expenses decreased $2.4 million, or 19.9%, to $9.6 million for the three months ended December 31, 2025. The decrease is primarily due to $1.1 million of lease termination costs in the prior year period due to relocating from an existing warehouse facility prior to the conclusion of the lease term to a new and larger facility to expand existing operations, decreased technology spending, and a decrease in the allowance for credit losses. As a percentage of adjusted gross profit, SG&A decreased 381 basis points to 15.1% from 19.0% for the three months ended December 31, 2025 and 2024, respectively.

Depreciation and amortization costs decreased $1.4 million, or 29.2%, to $3.6 million for the three months ended December 31, 2025. The decrease is primarily attributable to amortization of intangible assets from acquisitions that are now fully amortized, partially offset by amortization of intangible assets from acquisitions that have occurred since the prior year period. As a percentage of adjusted gross profit, depreciation and amortization costs decreased 234 basis points to 5.6% from 8.0% for the three months ended December 31, 2025 and 2024, respectively.

Our decrease in net income is driven by increased personnel costs, offset by decreases to SG&A, depreciation and amortization, and income tax expense.

Our future financial results may be impacted by amortization of intangible assets resulting from acquisitions, and gains or losses from changes in fair value of contingent consideration, which are difficult to predict.

The following table provides a reconciliation for the three months ended December 31, 2025 and 2024 of adjusted EBITDA to net income (loss), the most directly comparable GAAP measure:

(In thousands)

(1) Other includes costs unrelated to our core operations (primarily acquisition and litigation costs), and other non-cash charges.

(2) Adjusted gross profit is revenues less the cost of transportation and other services.

Six months ended December 31, 2025 and 2024 (unaudited)

The following table summarizes revenues, cost of transportation and other services, and adjusted gross profit by reportable operating segments for the six months ended December 31, 2025 and 2024:

(In thousands)

(1) Adjusted gross profit is revenues less the cost of transportation and other services.

Transportation revenue was $430.9 million and $443.9 million for the six months ended December 31, 2025 and 2024, respectively. The decrease of $13.0 million, or 2.9%, is primarily attributable to meaningful project charter revenues in the prior year period, offset by incremental revenues generated from current and prior year acquisitions. Adjusted transportation gross profit was $105.2 million and $107.2 million for the six months ended December 31, 2025 and 2024, respectively. Net transportation margins increased from 24.1% to 24.4%, primarily due to project charter revenues in the prior year period, which have lower gross profit margin characteristics than other service levels.

Value-added services revenue was $27.9 million and $24.2 million for the six months ended December 31, 2025 and 2024, respectively. The increase is driven by higher volumes and incremental revenue from expanded warehouse operations primarily in our Canadian segment compared to the prior year period. Adjusted value-added services gross profit was $17.8 million for the six months ended December 31, 2025, compared to $13.7 million for the comparable prior year period. Adjusted value-added services gross profit percentage increased from 56.4% to 63.6%.

The following table provides a reconciliation for the six months ended December 31, 2025 and 2024 of adjusted gross profit to gross profit, the most directly comparable GAAP measure:

(In thousands)

32

The following table compares condensed consolidated statements of comprehensive income data by reportable operating segments for the six months ended December 31, 2025 and 2024:

(In thousands)

(1) Adjusted gross profit is revenues less the cost of transportation and other services.

Operating partner commissions increased $2.2 million, or 5.8%, to $40.3 million for the six months ended December 31, 2025. The increase in commissions is primarily due to an increase of adjusted gross profit generated from our strategic operating partners, partially offset by the conversions of strategic operating partners to Company-owned locations who earned commissions in the comparable prior year period. As a percentage of adjusted gross profit, operating partner commissions increased 127 basis points to 32.8% from 31.5% for the six months ended December 31, 2025 and 2024, respectively, as a result of a higher mix of adjusted gross profit generated from strategic operating partners compared to Company-owned locations due to the project charter revenues in the prior year period.

Personnel costs increased $5.0 million, or 12.7%, to $44.2 million for the six months ended December 31, 2025. The increase is primarily due to an increase in headcount from acquisitions in the current and prior year and the share-based compensation expense in the current period compared to a benefit in the prior year period, offset by decreases in sales commissions and bonus expenses. As a percentage of adjusted gross profit, personnel costs increased 351 basis points to 35.9% from 32.4% for the six months ended December 31, 2025 and 2024, respectively.

SG&A expenses decreased $0.6 million, or 2.9%, to $21.7 million for the six months ended December 31, 2025. The decrease is primarily due to $1.1 million of lease termination costs in the prior year period due to relocating from an existing warehouse facility prior to the conclusion of the lease term to a new and larger facility to expand existing operations, lower travel and entertainment, and lower professional service fees, partially offset by an increase to the allowance for credit losses and facilities costs from acquisitions. As a percentage of adjusted gross profit, SG&A decreased 83 basis points to 17.6% from 18.5% for the six months ended December 31, 2025 and 2024, respectively.

Depreciation and amortization costs decreased $2.7 million, or 27.9%, to $7.1 million for the six months ended December 31, 2025. The decrease is primarily attributable to amortization of intangible assets from acquisitions that are now fully amortized, partially offset by amortization of intangibles from acquisitions that have occurred since the prior year period. As a percentage of adjusted gross profit, depreciation and amortization costs decreased 237 basis points to 5.8% from 8.1% for the six months ended December 31, 2025 and 2024, respectively.

Our decrease in net income is driven principally by increased operating partner commissions and personnel costs, partially offset by decreases to depreciation and amortization and income tax expense compared to the comparable prior year period.

Our future financial results may be impacted by amortization of intangible assets resulting from acquisitions, and gains or losses from changes in fair value of contingent consideration, which are difficult to predict.

The following table provides a reconciliation for the six months ended December 31, 2025 and 2024 of adjusted EBITDA to net income (loss), the most directly comparable GAAP measure:

(In thousands)

(1) Depreciation and amortization for the purposes of calculating adjusted EBITDA, a non-GAAP financial measure, includes depreciation expenses recognized on certain computer software as a service.

(2) Other includes costs unrelated to our core operations (primarily acquisition and litigation costs), and other non-cash charges.

(3) Adjusted gross profit is revenues less the cost of transportation and other services.

Liquidity and Capital Resources

Generally, our primary sources of liquidity are cash generated from operating activities and borrowings under our Revolving Credit Facility, as described below. These sources also fund a portion of our capital expenditures and contractual contingent consideration obligations. Our level of cash and financing capabilities along with cash flows from operations have historically been sufficient to meet our operating and capital needs. As of December 31, 2025, we have $31.9 million in unrestricted cash and cash equivalents on hand available for working capital and general corporate purposes.

Net cash provided by operating activities was $14.8 million and $15.9 million for the six months ended December 31, 2025 and 2024, respectively. The cash provided primarily consisted of net income adjusted for depreciation and amortization and changes in accounts receivable, prepaid expenses, accounts payable, operating partner commissions payable, and accrued expenses and other liabilities. Cash flow from operating activities for the six months ended December 31, 2025 decreased by $1.1 million, compared with the same period in fiscal year 2025, primarily due to decreased net income, offset by net changes in operating assets and liabilities.

Net cash used for investing activities was $6.9 million and $19.4 million for the six months ended December 31, 2025 and 2024, respectively. Cash paid for acquisitions were $5.2 million and $15.9 million for the six months ended December 31, 2025 and 2024, respectively. Cash paid for purchases of property, technology, and equipment were $2.2 million and $3.6 million for the six months ended December 31, 2025 and 2024, respectively. Proceeds from sale of property, technology, and equipment were $0.5 million and $0.1 million for the six months ended December 31, 2025 and 2024, respectively.

Net cash provided by financing activities was $1.1 million and net cash used for financing activities was $1.4 million for the six months ended December 31, 2025 and 2024, respectively. Net proceeds from the Revolving Credit Facility were $10.0 million and $0.0 million for the six months ended December 31, 2025 and 2024, respectively. Repayments of notes payable and finance lease liabilities were $0.1 million and $0.4 million for the six months ended December 31, 2025 and 2024, respectively. Repurchases of common stock were $3.5 million and $0.7 million for the six months ended December 31, 2025 and 2024, respectively. Distributions to noncontrolling interest were less than $0.1 million for each of the six months ended December 31, 2025 and 2024, respectively. Proceeds from exercise of stock options were $0.3 million and $0.4 million for the six months ended December 31, 2025 and 2024, respectively. Payments of employee tax withholdings related to restricted stock units and stock options were $0.5 million and $0.6 million for the six months ended December 31, 2025 and 2024, respectively.

Revolving Credit Facility

The Company entered into a $200 million syndicated, revolving credit facility (the “Revolving Credit Facility”) pursuant to a Credit Agreement dated as of August 5, 2022, and amended as of September 27, 2023. The Revolving Credit Facility is segregated into two tranches, a $150 million tranche that may be loaned in U.S. Dollars and a $50 million tranche that may be loaned in either U.S. Dollars or Canadian Dollars. The Revolving Credit Facility includes a $75 million accordion feature to support future acquisition opportunities. The Revolving Credit Facility was entered into with Bank of America, N.A. and BMO Capital Markets Corp. as joint book runners and joint lead arrangers, Bank of America, N.A. as Administrative Agent, Swingline Lender and Letter of Credit Issuer, Bank of Montreal as syndication agent, KeyBank National Association and MUFG Union Bank, N.A. as co-documentation agents and Bank of America, N.A., Bank of Montreal, KeyBank National Association, MUFG Union Bank, N.A. and Washington Federal Bank, National Association as lenders (such named lenders are collectively referred to herein as “Lenders”).

The Revolving Credit Facility matures on August 5, 2027 and is collateralized by a first-priority security interest in the accounts receivable and other assets of the Company and our subsidiaries, including, without limitation, all of the capital stock of our subsidiaries. Borrowings in U.S. Dollars accrue interest (at the Company’s option) at a) the Lenders’ base rate plus 0.50% to 1.50%; b) Term Secured Overnight Financing Rate (“SOFR”) plus 1.40% to 2.40%; or c) Term SOFR Daily Floating Rate plus 1.40% to 2.40%. Borrowings in Canadian Dollars accrue interest (at the Company’s option) at a) Term Canadian Overnight Repo Rate Average (“CORRA”) plus 0.29547% to 0.32138% depending on the term, plus 1.40% to 2.40%; or b) Daily Simple CORRA plus 0.29547% plus 1.40% to 2.40%. Rates are adjusted based on the Company’s consolidated net leverage ratio. The Company’s U.S. and Canadian subsidiaries are guarantors of the Revolving Credit Facility.

For borrowings under the Revolving Credit Facility, the Company is subject to the maximum consolidated net leverage ratio of 3.00 and minimum consolidated interest coverage ratio of 3.00. Additional minimum availability requirements and financial covenants apply in the event the Company seeks to use advances under the Revolving Credit Facility to pursue acquisitions or repurchase its common stock.

As of December 31, 2025, borrowings outstanding on the Revolving Credit Facility were $30.0 million. The Company was in compliance with its covenants.

We are exposed to market risks in the ordinary course of business. These risks are primarily related to foreign exchange risk. We have currency exposure arising from both sales and purchases denominated in foreign currencies, as well as intercompany transactions. Significant changes in exchange rates between foreign currencies in which we transact business and the U.S. dollar may adversely affect our results of operations and financial condition. Historically, we have not entered into any hedging activities, and, to the extent that we continue not to do so in the future, we may be vulnerable to the effects of currency exchange rate fluctuations. A portion of our business is conducted in Canada and Mexico. If foreign exchange rates were 1.0% higher or lower, our net income for the six months ended December 31, 2025 would have changed by approximately $0.15 million. A fluctuation in foreign exchange rates could have a modest impact on the contingent consideration payments that could be due under our acquisition of Weport, S.A. de C.V.

We are also subject to risks related to an increase in interest rates. For every $1.0 million outstanding on our Revolving Credit Facility, we will incur approximately $0.05 million of interest expense. For every 1.0% increase in interest rates, our interest expense per $1.0 million in borrowings will increase by approximately $0.01 million.

Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure.

An evaluation of the effectiveness of our “disclosure controls and procedures” (as such term is defined in Rules 13a-15(e) or 15d-15(e) of the Exchange Act) as of December 31, 2025 was carried out by our management under the supervision and with the participation of our CEO and CFO. Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of December 31, 2025.

Management believes that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows as of and for the periods presented, in accordance with U.S. GAAP.

Changes in Internal Control over Financial Reporting

There have not been any changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the three months ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

There have been no material changes in the risk factors disclosed by us under Part I, Item 1A. Risk Factors contained in the Annual Report on Form 10-K for the fiscal year ended June 30, 2025.