The Marketing Alliance Announces Financial Results for Fiscal Second Quarter Ended September 30, 2025

Rhea-AI Summary

The Marketing Alliance (OTC: MAAL) reported fiscal Q2 2026 results for the quarter ended Sept 30, 2025. Revenues were $4,668,836, down from $4,983,950 year‑over‑year, driven mainly by delays in the construction segment. Net income was $263,407, or $0.04 per share, versus $401,511 or $0.05 per share a year earlier. Operating income from continuing operations fell to $149,507 from $486,639. Operating EBITDA (ex‑investment income) was $202,480 versus $553,396 prior year. The company repurchased shares under an active program (319,506 shares repurchased as of Oct 15) and held $2.0M cash with shareholders' equity of $5.7M on Sept 30, 2025.

Positive

• Cash increased to $2.0M on Sept 30, 2025
• Repurchased 319,506 shares under buyback programs as of Oct 15, 2025
• Non‑operating investment gain of $155,417 supported net income

Negative

• Revenue declined to $4.67M from $4.98M (down ~6%) due to construction delays
• Net operating revenue (gross profit) fell by $603,264 year‑over‑year
• Operating income dropped to $149,507 from $486,639 (~69% decline)
• Operating EBITDA fell to $202,480 from $553,396 (~63% decline)
• Shareholders' equity declined to $5.7M from $6.4M (~10.9% decline)

ST. LOUIS, Nov. 14, 2025 (GLOBE NEWSWIRE) -- The Marketing Alliance, Inc. (OTC: MAAL) (“TMA” or the “Company”), announced its financial results today for its fiscal 2026 second quarter ended September 30, 2025.

Q2 2026 Financial Key Items (all comparisons to the prior year quarter)

• Revenues from operations were $4,668,836 compared to $4,983,950, a decrease of over 6% which was almost entirely in the construction business
• Operating income from continuing operations of $149,507 compared to $486,639 in the prior year quarter
• Net income was $263,407 or $0.04 per share in the quarter compared to $401,511 or $0.05 per share in the prior year quarter
• During the quarter the Company repurchased 166,146 shares, and subsequent to the end of quarter the Company repurchased an additional 50,000 shares. Repurchases under the program may be made through privately negotiated transactions when the Company is contacted directly or open market transactions (please see the Company’s April 2, 2025, press release for more information and important disclosures). The press release is available on the Company’s website

Management Comments
Timothy M. Klusas, TMA’s Chief Executive Officer, commented, “We continued to invest in the insurance distribution business but were not able to realize the benefit of anticipated growth in this quarter as insurance revenue remained flat. We finished the quarter with investments in business development and our call center that have the potential to show intended results in future quarters.

Further, as our business continues to evolve, in a previous quarter (ending December 2024) we elected to acknowledge the changing nature of our reimbursement and marketing revenues by recognizing them over their respective projected project lives (often the calendar year) instead of when agreed and billed. Historically the company treated non-refundable reimbursement and marketing fee revenue from carriers as earned when the agreed upon amount was invoiced. We acknowledged any timing differences of these payments as deferred revenue on the balance sheet. We continued to treat reimbursement and marketing revenue as a time-duration item and allocated revenue throughout its respective period and on the balance sheet as Deferred Revenue.

The construction business was affected by significant delays at a large project where we could not generate revenue despite incurring the labor and overhead costs of being onsite and committed to the project, as opposed to being able to work elsewhere on other projects. In prior periods we were able to balance multiple projects to be able to offset a delay such as this, but, unfortunately, this quarter we had no other alternatives. Our expectation at the end of this quarter was that revenue would be deferred into the next quarter as delays lessened”.

Second Quarter Fiscal Year 2026 Financial Review

• Revenues were $4,668,836 compared to $4,983,950 in the prior year quarter. Virtually all of the decline was in the construction business.
  
  
• Net operating revenue (gross profit) for the quarter was $851,155 compared to net operating revenue of $1,454,419 in the prior year quarter for a decrease of $603,264. The insurance distribution business accounted for 33% (or $197,955) of the decrease due to flat revenue matched with increased commissions costs from an adverse product mix and increased Business processing and distributor costs due in our call center and added business development expense. The construction business accounted for 67% (or $405,310) of the gross profit decrease due to uncontrollable delays with a large project resulting in costs in excess of revenues generated. Our employees were not able to make progress on a large job despite the costs of being onsite and committed to the project.
  
  
• Operating expenses were less this quarter than the prior year quarter, $701,648 compared to $967,780. An increase in compensation expense was offset by decreases in office and administrative expense and professional fees, as the Company hired employees that were previously its outsourced bookkeeping and administrative staff. Stock-based compensation expense also decreased from the prior year quarter.
  
  
• The Company reported operating income from continuing operations of $149,507 compared to $486,639, in the prior year quarter, with differences due to factors discussed above.
  
  
• Operating EBITDA (excluding investment portfolio income) of $202,480 was a decrease from the prior year quarter of $553,396. A note reconciling operating EBITDA to operating income can be found at the end of this release.
  
  
• Investment gain (loss), net (from non-operating investment portfolio) for the quarter was $155,417 as compared with $61,203 in the previous year quarter.
  
  
• Net income was $263,407, or $0.04 per share, compared to $401,511 or $0.05 per share in the previous year quarter.
  
  
• During the first fiscal quarter, on April 2, the Company announced that its Board of Directors had authorized a share repurchase program to repurchase up to 800,000 shares of the Company's issued and outstanding common stock, effective immediately and concluding March 31, 2026. As of October 15, the Company had repurchased 319,506 shares under this program. The April 2 announcement followed the successful completion of an 800,000 share repurchase program announced in October 2024 and completed March 2025.
  
  

Balance Sheet Information

• TMA’s balance sheet on September 30, 2025, reflected cash and cash equivalents of $2.0 million; working capital of $5.3 million; and shareholders’ equity of $5.7 million; compared to cash and cash equivalents of $1.4 million, working capital of $6.1 million, and shareholders’ equity of $6.4 million as of September 30, 2024.
  

About The Marketing Alliance, Inc.

Headquartered in St. Louis, MO, TMA provides support to independent insurance brokerage agencies, with a goal of integrating insurance and “insuretech” engagement platforms to provide members value-added services on a more efficient basis than they can achieve individually.

Investor information can be accessed through the shareholder section of TMA’s website at: http://www.themarketingallianceinc.com.

TMA’s common stock is quoted on the OTC Markets (http://www.otcmarkets.com) under the symbol “MAAL”.

Forward Looking Statement
Investors are cautioned that forward-looking statements involve risks and uncertainties that may affect TMA's business and prospects. Examples of forward-looking statements include, among others, statements we make regarding our expectations of growth based upon our investments in our business, our recently announced stock repurchase program, our plans to reduce expenses, and our ability to undertake more suitable jobs and generate earnings, or reduce expenses, from our construction business. Any forward-looking statements contained in this press release represent our estimates, expectations or intentions only as of the date hereof, or as of such earlier dates as are indicated, and should not be relied upon as representing our views as of any subsequent date. These statements involve a number of risks and uncertainties, including, but not limited to, expectations of the economic environment, material adverse changes in economic conditions in the markets we serve and in the general economy; the ways that insurance carriers may react in their underwriting policies and procedures to the continuing risks they perceive from public health matters; our reliance on a limited number of insurance carriers and any potential termination of those relationships or failure to develop new relationships; privacy and cyber security matters and our ability to protect confidential information; future state and federal regulatory actions and conditions in the states in which we conduct our business; our ability to work with carriers on marketing, distribution and product development; pricing and other payment decisions and policies of the carriers in our insurance distribution business, changes in the public securities markets that affect the value of our investment portfolio; and weather and environmental conditions in the areas served by our construction business. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so.
.

Contact:
The Marketing Alliance, Inc.	-OR-	The Equity Group Inc.
Timothy M. Klusas, President		Jeremy Hellman, Vice President
(314) 275-8713		(212) 836-9626
tklusas@themarketingalliance.com www.TheMarketingAlliance.com		jhellman@equityny.com

CONSOLIDATED STATEMENTS OF OPERATIONS
		Three Months Ended								Six Months Ended
		September 30,								September 30,
		2025				2024				2025				2024
Insurance commission and fee revenue	$	4,391,678			$	4,391,680			$	9,071,982			$	8,752,271
Construction revenue		277,158				592,270				456,744				689,722
Total revenues		4,668,836				4,983,950				9,528,726				9,441,993
Insurance distributor related expenses:
Distributor bonuses and commissions		2,959,217				2,852,956				6,147,299				5,874,359
Business processing and distributor costs		539,130				446,389				1,058,756				837,784
Depreciation		864				1,913				1,728				4,834
		3,499,211				3,301,258				7,207,783				6,716,977
Costs of construction:
Direct and indirect costs of construction		271,344				165,346				413,371				296,778
Depreciation		47,126				62,927				87,626				125,189
		318,470				228,273				500,997				421,967
Total costs of revenues		3,817,681				3,529,531				7,708,780				7,138,944
Net operating revenue		851,155				1,454,419				1,819,947				2,303,049
Total general and administrative expenses		701,648				967,780				1,420,173				1,767,554
Operating income from continuing operations		149,507				486,639				399,773				535,495
Other income (expense):
Other		-				-				-				4,938
Investment gains (losses), net		155,417				61,203				258,000				23,983
Interest		(5,018	)			(31,331	)			(22,841	)			(74,658	)
Income from continuing operations before provision		299,907				516,511				634,932				489,758
for income taxes
Income tax expense		36,500				115,000				95,900				138,100
Net Income	$	263,407			$	401,511			$	539,032			$	351,658
Average Shares Outstanding		7,188,088				8,210,266				7,188,088				8,210,266
Operating Income from continuing operations per Share	$	0.02			$	0.06			$	0.06			$	0.07
Net Income per Share	$	0.04			$	0.05			$	0.07			$	0.04

CONSOLIDATED BALANCE SHEETS
		As of September 30,
		2025				2024
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,011,640			$	1,373,965
Equity securities		2,269,490				2,768,917
Restricted cash		-				2,098,557
Accounts receivable		7,946,925				6,937,248
Current portion of notes receivable		-				541,860
Prepaid expenses and other current assets		198,460				172,557
Total current assets		12,426,515				13,893,104
PROPERTY AND EQUIPMENT, net		553,965				762,452
OTHER ASSETS
Notes receivable, net due to the allowance		-				63,614
Operating lease right-of-use assets		534,037				115,183
Total other assets		534,037				178,797
	$	13,514,517			$	14,834,353
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses		6,452,621				4,897,940
Deferred Revenue		380,020				82,075
Current portion of notes payable		114,812				2,604,804
Current portion of finance lease liability		-				119,946
Current portion of operating lease liability		154,261				76,956
Liablities related to discontinued operations		677				677
Total current liabilities		7,102,391				7,782,398
LONG-TERM LIABILITIES
Notes payable, net of current portion and debt issuance costs		179,262				291,174
Operating lease liability, net of current portion		384,524				35,951
Deferred taxes		149,200				313,000
Total long-term liabilities		712,986				640,125
Total liabilities		7,815,377				8,422,523
COMMITMENTS AND CONTINGENCIES (NOTE 13)
SHAREHOLDERS' EQUITY
Common stock, no par value; 50,000,000 shares authorized,
8,210,266 shares issued and outstanding September 30, 2024
7,188,088 shares issued and outstanding September 30, 2025	$	1,176,441			$	1,173,061
Treasury Stock		(209,112	)			-
Retained earnings		4,731,812				5,238,769
Total shareholders' equity		5,699,140				6,411,830
	$	13,514,517			$	14,834,353

Note – Operating EBITDA (excluding investment portfolio income) 

		Three Months Ended						Six Months Ended
EBITDA Calculation		September 30,						September 30,
		2025			2024			2025			2024
Operating Income from Continuing Operations	$	149,507		$	486,639		$	399,773		$	535,495
Add:
Depreciation/Amortization Expense	$	52,972		$	66,757		$	99,319		$	141,508
EBITDA (Excluding Investment Portfolio Income)	$	202,480		$	553,396		$	499,092		$	677,003

The Company elects not to include investment portfolio income because the Company believes it is non-operating in nature.

The Company uses Operating EBITDA as a measure of operating performance. However, Operating EBITDA is not a recognized measurement under U.S. generally accepted accounting principles, or GAAP, and when analyzing its operating performance, investors should use Operating EBITDA in addition to, and not as an alternative for, income as determined in accordance with GAAP. Because not all companies use identical calculations, its presentation of Operating EBITDA may not be comparable to similarly titled measures of other companies and is therefore limited as a comparative measure. Furthermore, as an analytical tool, Operating EBITDA has additional limitations, including that (a) it is not intended to be a measure of free cash flow, as it does not consider certain cash requirements such as tax payments; (b) it does not reflect changes in, or cash requirements for, its working capital needs; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and Operating EBITDA does not reflect any cash requirements for such replacements, or future requirements for capital expenditures or contractual commitments. To compensate for these limitations, the Company evaluates its profitability by considering the economic effect of the excluded expense items independently as well as in connection with its analysis of cash flows from operations and through the use of other financial measures.

The Company believes Operating EBITDA is useful to an investor in evaluating its operating performance because it is widely used to measure a company’s operating performance without regard to certain non-cash or unrealized expenses (such as depreciation and amortization) and expenses that are not reflective of its core operating results over time. The Company believes Operating EBITDA presents a meaningful measure of corporate performance exclusive of its capital structure, the method by which assets were acquired, and non-cash charges and provides additional useful information to measure performance on a consistent basis, particularly with respect to changes in performance from period to period.

FAQ

What were MAAL revenues for fiscal Q2 2026 and how do they compare to Q2 2025?

MAAL reported $4,668,836 in revenues for Q2 2026, down from $4,983,950 in Q2 2025 (a decline driven mainly by the construction business).

How much net income did MAAL report for the quarter ended Sept 30, 2025 (MAAL)?

MAAL reported net income of $263,407, or $0.04 per share, for the quarter ended Sept 30, 2025.

What caused MAAL's operating income decline in Q2 2026 (MAAL)?

The decline was driven by construction project delays that reduced revenue while incurring onsite labor and overhead, plus flat insurance revenue with higher commission and call‑center costs.

How many shares has MAAL repurchased under its buyback program as of Oct 15, 2025?

As of Oct 15, 2025, MAAL had repurchased 319,506 shares under the current repurchase authorization.

What was MAAL's cash and shareholders' equity on Sept 30, 2025?

MAAL reported $2.0M in cash and cash equivalents and $5.7M in shareholders' equity on Sept 30, 2025.