[10-Q] DMC Global Inc. Quarterly Earnings Report
Filing Impact
Filing Sentiment
Form Type
10-Q
Hoth Therapeutics, Inc. (NASDAQ: HOTH) filed a Form S-8 to register 2,000,000 additional common shares for issuance under its Amended & Restated 2022 Omnibus Equity Incentive Plan. Following shareholder approval on 5-Aug-2025, the total pool available under the plan rose to 3,091,317 shares, up from 1,091,317. The filing is made pursuant to General Instruction E, incorporating prior S-8 registrations (File Nos. 333-265984, 333-274125, 333-281610).
The company is classified as a non-accelerated filer and smaller reporting company. No financial results, earnings guidance, or transactional disclosures are included; the document solely registers equity compensation securities. Sheppard, Mullin, Richter & Hampton LLP provided the legal opinion (Exhibit 5.1) and WithumSmith+Brown, PC consented as auditor (Exhibit 23.1).
Once effective, the newly registered shares can be issued through option, RSU or other award agreements listed in the exhibit index. Signature pages include CEO Robb Knie and CFO David Briones, with a blanket power of attorney for future amendments.
Hoth Therapeutics, Inc. (NASDAQ: HOTH) ha depositato un modulo Form S-8 per registrare 2.000.000 di azioni ordinarie aggiuntive da emettere nell'ambito del suo Piano di Incentivi Azionari Omnibus Modificato e Ristabilito 2022. Dopo l'approvazione degli azionisti il 5 agosto 2025, il totale delle azioni disponibili nel piano è salito a 3.091.317 azioni, rispetto a 1.091.317 precedenti. La registrazione è effettuata in conformità con l'Istruzione Generale E, incorporando precedenti registrazioni S-8 (Numeri di File 333-265984, 333-274125, 333-281610).
L'azienda è classificata come non-accelerated filer e smaller reporting company. Non sono inclusi risultati finanziari, previsioni sugli utili o comunicazioni di transazioni; il documento registra esclusivamente titoli di compensazione azionaria. Lo studio legale Sheppard, Mullin, Richter & Hampton LLP ha fornito il parere legale (Esibizione 5.1) e WithumSmith+Brown, PC ha dato il proprio consenso come revisore (Esibizione 23.1).
Una volta efficace, le azioni appena registrate potranno essere emesse tramite opzioni, RSU o altri accordi di assegnazione elencati nell'indice delle esibizioni. Le pagine con le firme includono il CEO Robb Knie e il CFO David Briones, con una procura generale per future modifiche.
Hoth Therapeutics, Inc. (NASDAQ: HOTH) presentó un Formulario S-8 para registrar 2,000,000 acciones comunes adicionales para emisión bajo su Plan de Incentivos de Capital Omnibus Enmendado y Restablecido de 2022. Tras la aprobación de los accionistas el 5 de agosto de 2025, el total disponible bajo el plan aumentó a 3,091,317 acciones, desde 1,091,317. La presentación se realiza conforme a la Instrucción General E, incorporando registros S-8 previos (Números de Archivo 333-265984, 333-274125, 333-281610).
La compañía está clasificada como no acelerada y compañía con reporte reducido. No se incluyen resultados financieros, pronósticos de ganancias ni divulgaciones transaccionales; el documento únicamente registra valores de compensación accionaria. Sheppard, Mullin, Richter & Hampton LLP proporcionó la opinión legal (Exhibición 5.1) y WithumSmith+Brown, PC consintió como auditor (Exhibición 23.1).
Una vez efectivo, las acciones recién registradas podrán emitirse mediante opciones, RSU u otros acuerdos de premios listados en el índice de exhibiciones. Las páginas de firmas incluyen al CEO Robb Knie y al CFO David Briones, con un poder notarial general para futuras enmiendas.
Hoth Therapeutics, Inc. (NASDAQ: HOTH)는 수정 및 재작성된 2022년 통합 주식 인센티브 계획에 따라 2,000,000주의 추가 보통주를 등록하기 위해 Form S-8을 제출했습니다. 2025년 8월 5일 주주 승인 이후, 계획 하에 사용 가능한 총 주식 수는 3,091,317주로 증가했으며, 이전의 1,091,317주에서 상승했습니다. 이 제출은 일반 지침 E에 따라 이전 S-8 등록(파일 번호 333-265984, 333-274125, 333-281610)을 포함합니다.
회사는 비가속 신고자 및 소규모 보고 회사로 분류됩니다. 재무 결과, 수익 가이드라인 또는 거래 공시는 포함되어 있지 않으며, 문서는 오직 주식 보상 증권만 등록합니다. 법률 의견서는 Sheppard, Mullin, Richter & Hampton LLP가 제공(전시물 5.1)하였고, 감사인 동의서는 WithumSmith+Brown, PC가 제공(전시물 23.1)했습니다.
효력이 발생하면 새로 등록된 주식은 옵션, RSU 또는 전시 색인에 나열된 기타 수상 계약을 통해 발행될 수 있습니다. 서명 페이지에는 CEO Robb Knie와 CFO David Briones가 포함되어 있으며, 향후 수정에 대한 포괄적 위임장이 포함되어 있습니다.
Hoth Therapeutics, Inc. (NASDAQ : HOTH) a déposé un formulaire S-8 pour enregistrer 2 000 000 d'actions ordinaires supplémentaires à émettre dans le cadre de son Plan d'Incitation Globale Modifié et Restitué 2022. Suite à l'approbation des actionnaires le 5 août 2025, le total disponible dans le plan est passé à 3 091 317 actions, contre 1 091 317 auparavant. Le dépôt est effectué conformément à l'Instruction Générale E, incorporant les enregistrements S-8 antérieurs (numéros de dossier 333-265984, 333-274125, 333-281610).
L'entreprise est classée comme déposant non accéléré et petite société déclarante. Aucun résultat financier, prévision de bénéfices ou divulgation transactionnelle n'est inclus ; le document enregistre uniquement des titres de rémunération en actions. Sheppard, Mullin, Richter & Hampton LLP a fourni l'avis juridique (Exhibit 5.1) et WithumSmith+Brown, PC a donné son consentement en tant qu'auditeur (Exhibit 23.1).
Une fois effectif, les actions nouvellement enregistrées pourront être émises via des options, des RSU ou d'autres accords d'attribution listés dans l'index des pièces. Les pages de signature incluent le PDG Robb Knie et le directeur financier David Briones, avec une procuration générale pour les amendements futurs.
Hoth Therapeutics, Inc. (NASDAQ: HOTH) hat ein Formular S-8 eingereicht, um 2.000.000 zusätzliche Stammaktien zur Ausgabe im Rahmen seines geänderten und neu gefassten Omnibus-Aktienanreizplans 2022 zu registrieren. Nach der Zustimmung der Aktionäre am 5. August 2025 erhöhte sich der gesamte verfügbare Pool unter dem Plan auf 3.091.317 Aktien, von zuvor 1.091.317. Die Einreichung erfolgt gemäß Allgemeiner Anweisung E und beinhaltet frühere S-8-Registrierungen (Aktenzeichen 333-265984, 333-274125, 333-281610).
Das Unternehmen ist als nicht beschleunigter Einreicher und kleiner berichtspflichtiger Gesellschaft klassifiziert. Es sind keine Finanzergebnisse, Gewinnprognosen oder Transaktionsmitteilungen enthalten; das Dokument registriert ausschließlich Aktienvergütungswerte. Sheppard, Mullin, Richter & Hampton LLP erbrachte die Rechtsmeinung (Anlage 5.1) und WithumSmith+Brown, PC stimmte als Wirtschaftsprüfer zu (Anlage 23.1).
Nach Wirksamwerden können die neu registrierten Aktien über Optionen, RSUs oder andere in der Ausstellungsübersicht aufgeführte Vergabevereinbarungen ausgegeben werden. Die Unterschriftsseiten enthalten CEO Robb Knie und CFO David Briones, mit einer umfassenden Vollmacht für zukünftige Änderungen.
Positive
- Shareholder approval on 5-Aug-2025 demonstrates investor support for the equity incentive plan.
- Expanded share reserve ensures the company can continue to grant stock-based awards to attract and retain talent.
Negative
- Potential dilution: registration of 2,000,000 additional shares may increase the share count when awards are exercised or vest.
Insights
TL;DR: Registers 2 M new plan shares; routine, limited market impact.
The filing simply tops up the 2022 equity plan, bringing capacity to ~3.1 M shares. This is a standard administrative action that enables continued stock-based compensation. While the pool expansion could introduce incremental dilution when awards vest, no immediate issuance or financial outlay occurs. Because Hoth is a micro-cap with frequent equity incentives, the additional shares help attract talent but do not, by themselves, alter valuation fundamentals. No change to control provisions or plan terms beyond share count is disclosed.
TL;DR: Shareholders approved plan amendment; governance procedure appears proper.
The document confirms shareholder authorization for the increase, satisfying best-practice governance. Prior S-8 filings are cross-referenced, and requisite consents/opinions are attached. The power-of-attorney language is typical. No red flags around board approval, timing, or required disclosures emerge. Therefore, the action is procedurally sound and not materially impactful to governance risk profiles.
Hoth Therapeutics, Inc. (NASDAQ: HOTH) ha depositato un modulo Form S-8 per registrare 2.000.000 di azioni ordinarie aggiuntive da emettere nell'ambito del suo Piano di Incentivi Azionari Omnibus Modificato e Ristabilito 2022. Dopo l'approvazione degli azionisti il 5 agosto 2025, il totale delle azioni disponibili nel piano è salito a 3.091.317 azioni, rispetto a 1.091.317 precedenti. La registrazione è effettuata in conformità con l'Istruzione Generale E, incorporando precedenti registrazioni S-8 (Numeri di File 333-265984, 333-274125, 333-281610).
L'azienda è classificata come non-accelerated filer e smaller reporting company. Non sono inclusi risultati finanziari, previsioni sugli utili o comunicazioni di transazioni; il documento registra esclusivamente titoli di compensazione azionaria. Lo studio legale Sheppard, Mullin, Richter & Hampton LLP ha fornito il parere legale (Esibizione 5.1) e WithumSmith+Brown, PC ha dato il proprio consenso come revisore (Esibizione 23.1).
Una volta efficace, le azioni appena registrate potranno essere emesse tramite opzioni, RSU o altri accordi di assegnazione elencati nell'indice delle esibizioni. Le pagine con le firme includono il CEO Robb Knie e il CFO David Briones, con una procura generale per future modifiche.
Hoth Therapeutics, Inc. (NASDAQ: HOTH) presentó un Formulario S-8 para registrar 2,000,000 acciones comunes adicionales para emisión bajo su Plan de Incentivos de Capital Omnibus Enmendado y Restablecido de 2022. Tras la aprobación de los accionistas el 5 de agosto de 2025, el total disponible bajo el plan aumentó a 3,091,317 acciones, desde 1,091,317. La presentación se realiza conforme a la Instrucción General E, incorporando registros S-8 previos (Números de Archivo 333-265984, 333-274125, 333-281610).
La compañía está clasificada como no acelerada y compañía con reporte reducido. No se incluyen resultados financieros, pronósticos de ganancias ni divulgaciones transaccionales; el documento únicamente registra valores de compensación accionaria. Sheppard, Mullin, Richter & Hampton LLP proporcionó la opinión legal (Exhibición 5.1) y WithumSmith+Brown, PC consintió como auditor (Exhibición 23.1).
Una vez efectivo, las acciones recién registradas podrán emitirse mediante opciones, RSU u otros acuerdos de premios listados en el índice de exhibiciones. Las páginas de firmas incluyen al CEO Robb Knie y al CFO David Briones, con un poder notarial general para futuras enmiendas.
Hoth Therapeutics, Inc. (NASDAQ: HOTH)는 수정 및 재작성된 2022년 통합 주식 인센티브 계획에 따라 2,000,000주의 추가 보통주를 등록하기 위해 Form S-8을 제출했습니다. 2025년 8월 5일 주주 승인 이후, 계획 하에 사용 가능한 총 주식 수는 3,091,317주로 증가했으며, 이전의 1,091,317주에서 상승했습니다. 이 제출은 일반 지침 E에 따라 이전 S-8 등록(파일 번호 333-265984, 333-274125, 333-281610)을 포함합니다.
회사는 비가속 신고자 및 소규모 보고 회사로 분류됩니다. 재무 결과, 수익 가이드라인 또는 거래 공시는 포함되어 있지 않으며, 문서는 오직 주식 보상 증권만 등록합니다. 법률 의견서는 Sheppard, Mullin, Richter & Hampton LLP가 제공(전시물 5.1)하였고, 감사인 동의서는 WithumSmith+Brown, PC가 제공(전시물 23.1)했습니다.
효력이 발생하면 새로 등록된 주식은 옵션, RSU 또는 전시 색인에 나열된 기타 수상 계약을 통해 발행될 수 있습니다. 서명 페이지에는 CEO Robb Knie와 CFO David Briones가 포함되어 있으며, 향후 수정에 대한 포괄적 위임장이 포함되어 있습니다.
Hoth Therapeutics, Inc. (NASDAQ : HOTH) a déposé un formulaire S-8 pour enregistrer 2 000 000 d'actions ordinaires supplémentaires à émettre dans le cadre de son Plan d'Incitation Globale Modifié et Restitué 2022. Suite à l'approbation des actionnaires le 5 août 2025, le total disponible dans le plan est passé à 3 091 317 actions, contre 1 091 317 auparavant. Le dépôt est effectué conformément à l'Instruction Générale E, incorporant les enregistrements S-8 antérieurs (numéros de dossier 333-265984, 333-274125, 333-281610).
L'entreprise est classée comme déposant non accéléré et petite société déclarante. Aucun résultat financier, prévision de bénéfices ou divulgation transactionnelle n'est inclus ; le document enregistre uniquement des titres de rémunération en actions. Sheppard, Mullin, Richter & Hampton LLP a fourni l'avis juridique (Exhibit 5.1) et WithumSmith+Brown, PC a donné son consentement en tant qu'auditeur (Exhibit 23.1).
Une fois effectif, les actions nouvellement enregistrées pourront être émises via des options, des RSU ou d'autres accords d'attribution listés dans l'index des pièces. Les pages de signature incluent le PDG Robb Knie et le directeur financier David Briones, avec une procuration générale pour les amendements futurs.
Hoth Therapeutics, Inc. (NASDAQ: HOTH) hat ein Formular S-8 eingereicht, um 2.000.000 zusätzliche Stammaktien zur Ausgabe im Rahmen seines geänderten und neu gefassten Omnibus-Aktienanreizplans 2022 zu registrieren. Nach der Zustimmung der Aktionäre am 5. August 2025 erhöhte sich der gesamte verfügbare Pool unter dem Plan auf 3.091.317 Aktien, von zuvor 1.091.317. Die Einreichung erfolgt gemäß Allgemeiner Anweisung E und beinhaltet frühere S-8-Registrierungen (Aktenzeichen 333-265984, 333-274125, 333-281610).
Das Unternehmen ist als nicht beschleunigter Einreicher und kleiner berichtspflichtiger Gesellschaft klassifiziert. Es sind keine Finanzergebnisse, Gewinnprognosen oder Transaktionsmitteilungen enthalten; das Dokument registriert ausschließlich Aktienvergütungswerte. Sheppard, Mullin, Richter & Hampton LLP erbrachte die Rechtsmeinung (Anlage 5.1) und WithumSmith+Brown, PC stimmte als Wirtschaftsprüfer zu (Anlage 23.1).
Nach Wirksamwerden können die neu registrierten Aktien über Optionen, RSUs oder andere in der Ausstellungsübersicht aufgeführte Vergabevereinbarungen ausgegeben werden. Die Unterschriftsseiten enthalten CEO Robb Knie und CFO David Briones, mit einer umfassenden Vollmacht für zukünftige Änderungen.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-Q
(Mark One)
For the quarterly period ended June 30, 2025
OR
FOR THE TRANSITION PERIOD FROM TO .
Commission file number 001-14775
(Exact name of Registrant as Specified in its Charter)
| (State of Incorporation or Organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of principal executive offices, including zip code)
(303 ) 665-5700
(Registrant’s telephone number, including area code)
| Title of each class | Trading Symbol | Name of exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ | ||||||||
Non-accelerated filer ☐ | Smaller reporting company | |||||||
Emerging growth company | ||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 under the Act). Yes ☐ No ☒
The number of shares of Common Stock outstanding was 20,581,269 as of July 31, 2025.
CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS
This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of section 27A of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934. We intend the forward-looking statements throughout this quarterly report on Form 10-Q to be covered by the safe harbor provisions for forward-looking statements. Statements contained in this report which are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projected results. These statements can sometimes be identified by our use of forward-looking words such as “may,” “believe,” “plan,” “anticipate,” “estimate,” “expect,” “intend,” and other phrases of similar meaning. Such statements include, but are not limited to, expectations regarding market-responsive initiatives at Arcadia Products, cost reduction and market share expansion initiatives at DynaEnergetics, order activity improvements at NobelClad, our ability to access capital markets transactions in the future, the availability of funds to support our liquidity position and our expected future liquidity position. The forward-looking information is based on information available as of the date of this quarterly report and on numerous assumptions and developments that are not within our control. Although we believe that our expectations as expressed in these forward-looking statements are reasonable, we cannot assure you that our expectations will turn out to be correct. Factors that could cause actual results to differ materially include, but are not limited to, those factors referenced in our Annual Report on Form 10-K for the year ended December 31, 2024 and this Quarterly Report on Form 10-Q and other potential factors, including: geopolitical and economic instability, including recessions or depressions; inflation; supply chain delays and disruptions; the availability and cost of energy; transportation disruptions; the ability to obtain new contracts at attractive prices; the size and timing of customer orders and shipments; product pricing and margins; our ability to realize sales from our backlog; fluctuations in customer demand; fluctuations in foreign currencies; competitive factors; the timely completion of contracts; the timing and size of expenditures; the timely receipt of government approvals and permits; the price and availability of metal, aluminum, and other raw materials; fluctuations in tariffs or quotas; changes in laws and regulations, both domestic and foreign, impacting our business and the business of the end-market users we serve; the adequacy of local labor supplies at our facilities; changes in immigration laws or enforcement programs; current or future limits on manufacturing capacity at our various operations; the impact of pending or future litigation or regulatory matters; the availability and cost of funds; our ability to access our borrowing capacity under our credit facility or access the capital markets; the actions of activist stockholders; global economic conditions; and wars, terrorism and armed conflicts. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. We undertake no obligation to publicly release the results of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
INDEX
| Page | ||||||||
PART I - FINANCIAL INFORMATION | ||||||||
Item 1 | Condensed Consolidated Financial Statements | 4 | ||||||
Condensed Consolidated Balance Sheets as of June 30, 2025 (unaudited) and December 31, 2024 | 4 | |||||||
Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2025 and 2024 (unaudited) | 5 | |||||||
Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2025 and 2024 (unaudited) | 6 | |||||||
Condensed Consolidated Statements of Stockholders’ Equity and Redeemable Noncontrolling Interest for the three and six months ended June 30, 2025 and 2024 (unaudited) | 7 | |||||||
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024 (unaudited) | 9 | |||||||
Notes to Condensed Consolidated Financial Statements (unaudited) | 10 | |||||||
Item 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 26 | ||||||
Item 3 | Quantitative and Qualitative Disclosure about Market Risk | 43 | ||||||
Item 4 | Controls and Procedures | 43 | ||||||
PART II - OTHER INFORMATION | ||||||||
Item 1 | Legal Proceedings | 44 | ||||||
Item 1A | Risk Factors | 44 | ||||||
Item 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 45 | ||||||
Item 3 | Defaults Upon Senior Securities | 45 | ||||||
Item 4 | Mine Safety Disclosures | 45 | ||||||
Item 5 | Other Information | 45 | ||||||
Item 6 | Exhibits | 46 | ||||||
Signatures | 47 | |||||||
3
Table of Contents
Part I - FINANCIAL INFORMATION
ITEM 1. Condensed Consolidated Financial Statements
DMC GLOBAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands, Except Share and Per Share Data)
| June 30, 2025 | December 31, 2024 | ||||||||||
| (unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowance for doubtful accounts of $ | |||||||||||
| Inventories | |||||||||||
| Prepaid expenses and other | |||||||||||
| Total current assets | |||||||||||
| Property, plant and equipment | |||||||||||
| Less - accumulated depreciation | ( | ( | |||||||||
| Property, plant and equipment, net | |||||||||||
| Purchased intangible assets, net | |||||||||||
| Deferred tax assets | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses | |||||||||||
| Accrued income taxes | |||||||||||
| Accrued employee compensation and benefits | |||||||||||
| Contract liabilities | |||||||||||
| Current portion of long-term debt | |||||||||||
| Other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Deferred tax liabilities | |||||||||||
| Other long-term liabilities | |||||||||||
| Total liabilities | |||||||||||
Commitments and contingencies (Note 12) | |||||||||||
| Redeemable noncontrolling interest | |||||||||||
| Stockholders’ equity | |||||||||||
Preferred stock, $ | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
| Other cumulative comprehensive loss | ( | ( | |||||||||
Treasury stock, at cost, and company stock held for deferred compensation, at par; | ( | ( | |||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities, redeemable noncontrolling interest, and stockholders’ equity | $ | $ | |||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
4
Table of Contents
DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Share and Per Share Data)
(unaudited)
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of products sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Costs and expenses: | |||||||||||||||||||||||
| General and administrative expenses | |||||||||||||||||||||||
| Selling and distribution expenses | |||||||||||||||||||||||
| Amortization of purchased intangible assets | |||||||||||||||||||||||
| Strategic review and related expenses | |||||||||||||||||||||||
| Restructuring expenses and asset impairments | |||||||||||||||||||||||
| Total costs and expenses | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Other expense: | |||||||||||||||||||||||
| Other expense, net | ( | ( | ( | ( | |||||||||||||||||||
| Interest expense, net | ( | ( | ( | ( | |||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax provision | |||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Less: Net income attributable to redeemable noncontrolling interest | |||||||||||||||||||||||
| Net income attributable to DMC Global Inc. stockholders | $ | $ | $ | $ | |||||||||||||||||||
| Net (loss) income per share attributable to DMC Global Inc. stockholders: | |||||||||||||||||||||||
| Basic | $ | ( | $ | $ | ( | $ | |||||||||||||||||
| Diluted | $ | ( | $ | $ | ( | $ | |||||||||||||||||
| Weighted average shares outstanding: | |||||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
Reconciliation to net (loss) income attributable to DMC Global Inc. stockholders after adjustment of redeemable noncontrolling interest for purposes of calculating earnings per share
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income attributable to DMC Global Inc. stockholders | $ | $ | $ | $ | |||||||||||||||||||
| Adjustment of redeemable noncontrolling interest | ( | ( | ( | ||||||||||||||||||||
| Net (loss) income attributable to DMC Global Inc. stockholders after adjustment of redeemable noncontrolling interest | $ | ( | $ | $ | ( | $ | |||||||||||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in Thousands)
(unaudited)
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | ( | ( | |||||||||||||||||||||
| Other comprehensive income | $ | $ | $ | $ | |||||||||||||||||||
| Less: comprehensive income attributable to redeemable noncontrolling interest | |||||||||||||||||||||||
| Comprehensive income attributable to DMC Global Inc. stockholders | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND REDEEMABLE NONCONTROLLING INTEREST
(Amounts in Thousands, Except Share Data)
(unaudited)
| Other | Treasury Stock, at cost, and | Total | Redeemable | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Additional | Cumulative | Company Stock Held for | DMC Global Inc. | Non- | |||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock | Paid-In | Retained | Comprehensive | Deferred Compensation, at par | Stockholders’ | Controlling | |||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Capital | Earnings | Loss | Shares | Amount | Equity | Interest | |||||||||||||||||||||||||||||||||||||||||||||
| Balances, December 31, 2024 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in connection with stock compensation plans | ( | — | — | ( | ( | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Distribution to redeemable noncontrolling interest holder | — | — | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Adjustment of redeemable noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Treasury stock activity | — | — | — | — | — | ( | ( | ( | — | ||||||||||||||||||||||||||||||||||||||||||||
| Balances, March 31, 2025 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in connection with stock compensation plans | ( | — | — | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Distribution to redeemable noncontrolling interest holder | — | — | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Adjustment of redeemable noncontrolling interest | — | — | ( | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Treasury stock activity | — | — | — | — | — | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||||||
| Balances, June 30, 2025 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
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DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND REDEEMABLE NONCONTROLLING INTEREST
(Amounts in Thousands, Except Share Data)
(unaudited)
| Other | Treasury Stock, at cost, and | Total | Redeemable | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Additional | Cumulative | Company Stock Held for | DMC Global Inc. | Non- | |||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock | Paid-In | Retained | Comprehensive | Deferred Compensation, at par | Stockholders’ | Controlling | |||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Capital | Earnings | Loss | Shares | Amount | Equity | Interest | |||||||||||||||||||||||||||||||||||||||||||||
| Balances, December 31, 2023 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in connection with stock compensation plans | ( | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Distribution to redeemable noncontrolling interest holder | — | — | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Adjustment of redeemable noncontrolling interest | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Treasury stock activity | — | — | — | — | — | ( | ( | ( | — | ||||||||||||||||||||||||||||||||||||||||||||
| Balances, March 31, 2024 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | — | ( | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||||
| Shares issued in connection with stock compensation plans | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Distribution to redeemable noncontrolling interest holder | — | — | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Adjustment of redeemable noncontrolling interest | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Treasury stock activity | — | — | — | — | — | ( | ( | ( | — | ||||||||||||||||||||||||||||||||||||||||||||
| Balances, June 30, 2024 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements
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DMC GLOBAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
(unaudited)
| Six months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash from operating activities: | |||||||||||
| Depreciation | |||||||||||
| Amortization of purchased intangible assets | |||||||||||
| Amortization of deferred debt issuance costs | |||||||||||
| Stock-based compensation | |||||||||||
| Bad debt expense | |||||||||||
| Deferred income taxes | ( | ||||||||||
| Asset impairments | |||||||||||
| Other | ( | ||||||||||
| Change in: | |||||||||||
| Accounts receivable, net | ( | ( | |||||||||
| Inventories | ( | ||||||||||
| Prepaid expenses and other | |||||||||||
| Accounts payable | ( | ||||||||||
| Contract liabilities | ( | ( | |||||||||
| Accrued expenses and other liabilities | ( | ( | |||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Proceeds from maturities of marketable securities | |||||||||||
| Proceeds from sales of marketable securities | |||||||||||
| Acquisition of property, plant and equipment | ( | ( | |||||||||
| Proceeds from property, plant and equipment reimbursements | |||||||||||
| Proceeds on sale of property, plant and equipment | |||||||||||
| Proceeds from settlement of note receivable | |||||||||||
| Net cash (used in) provided by investing activities | ( | ||||||||||
| Cash flows from financing activities: | |||||||||||
| Repayments on term loan | ( | ( | |||||||||
| Borrowings on term loan | |||||||||||
| Borrowings on revolving loans | |||||||||||
| Repayments on revolving loans | ( | ( | |||||||||
| Payment of debt issuance costs | ( | ( | |||||||||
| Distributions to redeemable noncontrolling interest holder | ( | ( | |||||||||
| Net proceeds from issuance of common stock to employees and directors | |||||||||||
| Treasury stock purchases | ( | ( | |||||||||
| Net cash used in financing activities | ( | ( | |||||||||
| Effects of exchange rates on cash | ( | ||||||||||
| Net decrease in cash and cash equivalents | ( | ( | |||||||||
| Cash and cash equivalents, beginning of the period | |||||||||||
| Cash and cash equivalents, end of the period | $ | $ | |||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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DMC GLOBAL INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in Thousands, Except Share and Per Share Data)
(unaudited)
1. BASIS OF PRESENTATION
The information included in the Condensed Consolidated Financial Statements is unaudited but includes all normal and recurring adjustments which, in the opinion of management, are necessary for a fair presentation of the interim periods presented. Certain information and footnote disclosures, including critical and significant accounting policies normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles, have been condensed or omitted for this quarterly presentation. These Condensed Consolidated Financial Statements should be read in conjunction with the financial statements that are included in our Annual Report filed on Form 10-K for the year ended December 31, 2024.
2. SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The Condensed Consolidated Financial Statements include the accounts of DMC Global Inc. (“DMC”, “we”, “us”, “our”, or the “Company”) and its controlled subsidiaries. All intercompany accounts, profits, and transactions have been eliminated in consolidation.
Accounts Receivable
The Company measures expected credit losses for its accounts receivable using a current expected credit loss model, which is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. The Company has disaggregated pools of accounts receivable balances by business, geography and/or customer risk profile and has used history and other experience to establish an allowance for credit losses at the time the receivable is recognized. To measure expected credit losses, we have elected to pool trade receivables by segment and analyze each segment’s accounts receivable balances as separate populations. Within each segment, receivables exhibit similar risk characteristics.
The following table summarizes year-to-date activity in the allowance for credit losses on receivables from customers in each of our business segments:
| Arcadia Products | DynaEnergetics | NobelClad | DMC Global Inc. | ||||||||||||||||||||
Allowance for doubtful accounts, December 31, 2024 | $ | $ | $ | $ | |||||||||||||||||||
| Current period provision for expected credit losses | |||||||||||||||||||||||
| Write-offs charged against the allowance | ( | ( | ( | ||||||||||||||||||||
| Recoveries of amounts previously reserved | ( | ( | ( | ||||||||||||||||||||
| Impacts of foreign currency exchange rates and other | |||||||||||||||||||||||
Allowance for doubtful accounts, June 30, 2025 | $ | $ | $ | $ | |||||||||||||||||||
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Redeemable noncontrolling interest
On December 23, 2021, DMC completed the acquisition of 60 % of the membership interests in Arcadia Products, LLC, a Colorado limited liability company resulting from the conversion of Arcadia, Inc. (collectively, “Arcadia Products”). The limited liability company operating agreement for Arcadia Products (the “Operating Agreement”) contains a right for the Company to purchase the remaining interest in Arcadia Products from the minority interest holder on or after December 23, 2024 (“Call Option”). Similarly, the Operating Agreement originally permitted the minority interest holder of Arcadia Products the right to sell its remaining interest in Arcadia Products to the Company on or after December 23, 2024 ("Put Option"). On December 3, 2024, the Company and minority interest holder entered into an amendment to the Operating Agreement whereby the minority interest holder agreed not to exercise the Put Option until on or after September 6, 2026.
The purchase price for any interests sold pursuant to the Call Option or Put Option continues to be based upon a predefined calculation as included within the Operating Agreement. In connection with an exercise of the Call Option, the Operating Agreement would require payment of the purchase price in cash. However, in connection with the exercise of the Put Option, the Operating Agreement permits the Company the option to pay the purchase price in cash or in a combination of cash and preferred stock that would be authorized at that time.
The Company initially accounted for the noncontrolling interest at its acquisition date fair value. We determined that neither the Call Option nor the Put Option meet the definition of a derivative as the Operating Agreement does not allow for contractual net settlement, the options cannot be settled outside the Operating Agreement through a market mechanism, and the underlying shares are deemed illiquid as they are not publicly traded and thus not considered readily convertible to cash. Additionally, the settlement price for both options is based upon a predefined calculation tied to adjusted earnings rather than a fixed price, and the formula is based upon a multiple of Arcadia Products’ average adjusted earnings over a three-year period, subject to a floor value as defined in the Operating Agreement which is based primarily upon a contractually stated equity value. As such, we have concluded that the Call Option and Put Option are embedded within the noncontrolling interest and therefore do not represent freestanding instruments.
Given that the noncontrolling interest is subject to possible redemption with redemption rights that are not entirely within the control of the Company, we have concluded that the noncontrolling interest should be accounted for in accordance with ASC 480 Distinguishing Liabilities from Equity ("ASC 480"). The noncontrolling interest is also probable of redemption, as the only criteria for the security to become redeemable is the passage of time. As such, the redeemable noncontrolling interest is classified in temporary equity, separate from the stockholders’ equity section, in the Condensed Consolidated Balance Sheets.
At each balance sheet date subsequent to acquisition, two separate calculations must be performed to determine the value of the redeemable noncontrolling interest. First, the redeemable noncontrolling interest must be accounted for in accordance with ASC 810 Consolidation (“ASC 810”) whereby income (loss) and cash distributions attributable to the redeemable noncontrolling interest holder are ascribed. After this occurs, applicable provisions of ASC 480 must be considered to determine whether any further adjustment is necessary to increase the carrying value of the redeemable noncontrolling interest. An adjustment would only be necessary if the estimated settlement amount of the redeemable noncontrolling interest, per the terms of the Operating Agreement, exceeds the carrying value calculated in accordance with ASC 810. If such adjustment is required, the impact is immediately recorded to retained earnings and additional paid-in capital, upon absence of retained earnings, and therefore does not impact the Condensed Consolidated Statements of Operations or Comprehensive Income (Loss). As of June 30, 2025 and December 31, 2024, the redeemable noncontrolling interest was $187,080
Promissory Note
In order to equalize after-tax consideration to the redeemable noncontrolling interest holder relative to an alternative transaction structure, immediately following the closing of the acquisition, the Company loaned $24,902 to the redeemable noncontrolling interest holder. The loan was evidenced by an unsecured promissory note, and the loan will be repaid out of proceeds from the sale of the redeemable noncontrolling interest holder’s interests in Arcadia Products, whether received upon exercise of the Put Option, the Call Option or upon sale to third parties permitted under the terms of the Operating Agreement. The loan must be repaid in full at the earlier of the exercise of the Put or Call Option, or by December 16, 2051, and has been recorded within “Other assets” in the Condensed Consolidated Balance Sheets.
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Revenue Recognition
The Company’s revenues are derived from consideration paid by customers for tangible goods. The Company analyzes its different products by segment to determine the appropriate basis for revenue recognition. Revenue is not generated from sources other than contracts with customers and revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. There are no material upfront costs for operations that are incurred from contracts with customers.
See additional revenue recognition policy disclosures specific to each of our business segments within our Annual Report filed on Form 10-K for the year ended December 31, 2024.
Income Taxes
We recognize deferred tax assets and liabilities for the expected future income tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. Any effects of changes in income tax rates or tax laws are included in the provision for income taxes in the period of enactment. The deferred income tax impact of tax credits are recognized as an immediate adjustment to income tax expense. We recognize deferred tax assets for the expected future effects of all deductible temporary differences to the extent we believe these assets will more likely than not be realized. We record a valuation allowance when, based on current circumstances, it is more likely than not that all or a portion of the deferred tax assets will not be realized. In making such determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, recent financial performance and existing valuation allowances, if any.
We recognize the tax benefits from uncertain tax positions only when it is more likely than not, based on the technical merits of the position, that the tax position will be sustained upon examination, including the resolution of any related appeals or litigation. The tax benefits recognized in the Condensed Consolidated Financial Statements from such a position are measured as the largest benefit that is more likely than not to be realized upon ultimate resolution. We recognize interest and penalties related to uncertain tax positions in operating expense.
Earnings Per Share
In periods with net income, the Company computes earnings per share (“EPS”) using a two-class method, which is an earnings allocation formula that determines EPS for (i) each class of common stock (the Company has a single class of common stock), and (ii) participating securities according to dividends declared and participation rights in undistributed earnings. Restricted stock awards granted under the 2016 Omnibus Incentive Plan are considered participating securities in periods of net income as they receive non-forfeitable rights to dividends as common stock. Restricted stock awards do not participate in net losses.
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| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income attributable to DMC Global Inc. stockholders, as reported | $ | $ | $ | $ | |||||||||||||||||||
| Adjustment of redeemable noncontrolling interest | ( | ( | ( | ||||||||||||||||||||
| Less: Undistributed net income available to participating securities | ( | ( | |||||||||||||||||||||
| Numerator for basic net (loss) income per share: | ( | ( | |||||||||||||||||||||
| Add: Undistributed net income allocated to participating securities | |||||||||||||||||||||||
| Less: Undistributed net income reallocated to participating securities | ( | ( | |||||||||||||||||||||
| Numerator for diluted net (loss) income per share: | $ | ( | $ | $ | ( | $ | |||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted average shares outstanding for basic net (loss) income per share | |||||||||||||||||||||||
Effect of dilutive securities (1) | |||||||||||||||||||||||
| Weighted average shares outstanding for diluted net (loss) income per share | |||||||||||||||||||||||
| Net (loss) income per share attributable to DMC Global Inc. stockholders | |||||||||||||||||||||||
| Basic | $ | ( | $ | $ | ( | $ | |||||||||||||||||
| Diluted | $ | ( | $ | $ | ( | $ | |||||||||||||||||
(1) Given that we were in a net loss position for the three and six months ended June 30, 2025, all potentially dilutive shares were anti-dilutive and were therefore excluded from the determination of diluted EPS. For the three and six months ended June 30, 2024, 13,539 and 10,843 shares, respectively have been excluded as their effect would have been anti-dilutive.
Deferred Compensation Plan
The Company maintains a Non-Qualified Deferred Compensation Plan (the “Plan”) as part of its overall compensation package for certain employees. Participants are eligible to defer a portion of their annual salary, their annual incentive bonus, and their equity awards through the Plan on a tax-deferred basis. Deferrals into the Plan are not matched or subsidized by the Company, nor are they eligible for above-market or preferential earnings.
The Plan provides for deferred compensation obligations to be settled either by delivery of a fixed number of shares of DMC’s common stock or in cash, in accordance with participant contributions and elections. For deferred equity awards, subsequent to equity award vesting and after a period prescribed by the Plan, participants historically could elect to diversify contributions of equity awards into other investment options available to Plan participants. Once diversified, such contributions are settled by delivery of cash. Effective January 1, 2024, diversification of newly deferred equity awards is no longer permitted by the Plan.
The Company has established a grantor trust commonly known as a “rabbi trust” and contributed certain assets to partially satisfy the future obligations to participants in the Plan. These assets are subject to potential claims of the Company’s general creditors. The assets held in the trust include unvested restricted stock awards (“RSAs”), vested company stock awards, company-owned life insurance (“COLI”) on certain current and former employees, and money market funds. Unvested RSAs and common stock held by the trust are reflected in the Condensed Consolidated Balance Sheets within “Treasury stock, at cost, and company stock held for deferred compensation, at par” at the par value of the common stock or unvested RSAs. These accounts are not adjusted for subsequent changes in the fair value of the common stock. COLI is accounted for at the cash surrender value while money market funds held by the trust are accounted for at fair value.
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Deferred compensation obligations that will be settled in cash are accounted for on an accrual basis in accordance with the terms of the Plan. These obligations are adjusted based on changes in value of the underlying investment options chosen by Plan participants. Deferred compensation obligations that will be settled by delivery of a fixed number of previously vested shares of the Company’s common stock are reflected in the Condensed Consolidated Statements of Stockholders’ Equity and Redeemable Noncontrolling Interest within “Common stock” at the par value of the common stock or unvested RSAs. These accounts are not adjusted for subsequent changes in the fair value of the common stock.
The balances related to the deferred compensation plan were as follows for the periods presented. The amounts included within “Prepaid expenses and other” and “Other current liabilities” pertain to scheduled distributions per the terms of the Plan that will occur within twelve months of June 30, 2025.
| Balance Sheet location | June 30, 2025 | December 31, 2024 | ||||||||||||||||||
| Deferred compensation assets | Prepaid expenses and other | $ | $ | |||||||||||||||||
| Deferred compensation assets | Other assets | |||||||||||||||||||
| Deferred compensation obligations | Other current liabilities | |||||||||||||||||||
| Deferred compensation obligations | Other long-term liabilities | |||||||||||||||||||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We are required to use an established hierarchy for fair value measurements based upon the inputs to the valuation and the degree to which they are observable or not observable in the market. The three levels in the hierarchy are as follows:
•Level 1 — Inputs to the valuation based upon quoted prices (unadjusted) for identical assets or liabilities in active markets that are accessible as of the measurement date.
•Level 2 — Inputs to the valuation include quoted prices in either markets that are not active, or in active markets for similar assets or liabilities, inputs other than quoted prices that are observable, and inputs that are derived principally from or corroborated by observable market data.
•Level 3 — Inputs to the valuation that are unobservable inputs for the asset or liability.
The highest priority is assigned to Level 1 inputs and the lowest priority to Level 3 inputs.
The carrying value of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate their fair value. The carrying value of our revolving loans and term loan under our credit facility, and the European line of credit, when outstanding, also approximate their fair value because of the variable interest rate associated with these instruments, which reset each month at market interest rates. All of these account balances are considered Level 1 assets and liabilities.
We did not hold any Level 3 assets or liabilities as of June 30, 2025 or December 31, 2024.
Restructuring expenses and asset impairments
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Recent Accounting Pronouncements
In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2023-09 (“ASU 2023-09”), Income Taxes (Topic 740): Improvement to Income Tax Disclosures, which amends income tax disclosure requirements for the effective tax rate reconciliation to include incremental income tax information and expanded disclosures of income taxes paid. The guidance is effective for fiscal years beginning after December 15, 2024 and is applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of ASU 2023-09 on our financial statements and disclosures.
3. INVENTORIES
Inventories consisted of the following at June 30, 2025:
Arcadia Products | DynaEnergetics | NobelClad | DMC Global Inc. | ||||||||||||||||||||
| Raw materials | $ | $ | $ | $ | |||||||||||||||||||
| Work-in-process | |||||||||||||||||||||||
| Finished goods | |||||||||||||||||||||||
| Supplies | |||||||||||||||||||||||
| Total inventories | $ | $ | $ | $ | |||||||||||||||||||
Inventories consisted of the following at December 31, 2024:
Arcadia Products | DynaEnergetics | NobelClad | DMC Global Inc. | ||||||||||||||||||||
| Raw materials | $ | $ | $ | $ | |||||||||||||||||||
| Work-in-process | |||||||||||||||||||||||
| Finished goods | |||||||||||||||||||||||
| Supplies | |||||||||||||||||||||||
| Total inventories | $ | $ | $ | $ | |||||||||||||||||||
4. PURCHASED INTANGIBLE ASSETS
Our purchased intangible assets consisted of the following at June 30, 2025:
| Gross | Accumulated Amortization | Net | |||||||||||||||
| Customer relationships | ( | ||||||||||||||||
| Trademarks / Trade names | ( | ||||||||||||||||
| Total intangible assets | $ | $ | ( | $ | |||||||||||||
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Our purchased intangible assets consisted of the following at December 31, 2024:
| Gross | Accumulated Amortization | Net | |||||||||||||||
| Core technology | $ | $ | ( | $ | |||||||||||||
| Customer relationships | ( | ||||||||||||||||
| Trademarks / Trade names | ( | ||||||||||||||||
| Total intangible assets | $ | $ | ( | $ | |||||||||||||
5. CONTRACT LIABILITIES
| June 30, 2025 | December 31, 2024 | ||||||||||
Arcadia Products | $ | $ | |||||||||
| NobelClad | |||||||||||
| DynaEnergetics | |||||||||||
| Total | $ | $ | |||||||||
We generally expect to recognize the revenue associated with contract liabilities over a time period no longer than one year, but unforeseen circumstances can cause delays in shipments associated with contract liabilities, primarily supply chain delays and disruptions.
6. LEASES
The Company leases real properties for use in manufacturing and as administrative and sales offices, and leases automobiles and office equipment. The Company determines if a contract contains a lease arrangement at the inception of the contract. For leases in which the Company is the lessee, leases are classified as either finance or operating. Right-of-use (“ROU”) assets are initially measured at the present value of lease payments over the lease term plus initial direct costs, if any. If a lease does not provide a discount rate and the implicit rate cannot be readily determined, an incremental borrowing rate is used to determine the present value of future lease payments. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term within the Condensed Consolidated Statements of Operations. Lease and non-lease components within the Company’s lease agreements are accounted for together. Variable lease payments are recognized in the period in which the obligation is incurred.
Nearly all of the Company’s leasing arrangements are classified as operating leases. ROU asset and lease liability balances were as follows for the periods presented:
| June 30, 2025 | December 31, 2024 | ||||||||||
| ROU asset | $ | $ | |||||||||
| Current lease liability | |||||||||||
| Long-term lease liability | |||||||||||
| Total lease liability | $ | $ | |||||||||
The ROU asset is reported in “Other assets” while the current lease liability is reported in “Other current liabilities” and the long-term lease liability is reported in “Other long-term liabilities” in the Company’s Condensed Consolidated Balance Sheets. Cash paid for operating lease liabilities is recorded as operating cash outflows in the Company’s Condensed Consolidated Statements of Cash Flows.
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Arcadia Products leases certain office, manufacturing, distribution and warehouse facilities from entities affiliated with the redeemable noncontrolling interest holder and the president of Arcadia Products. There were eight such leases in effect as of June 30, 2025, with expiration dates ranging from calendar years 2025 to 2031, inclusive of the assumed exercise of applicable renewal options. As of June 30, 2025, the total ROU asset and related lease liability recognized for these leases was $19,921 and $21,065 , respectively. During the three and six months ended June 30, 2025 and 2024, associated lease expense was $1,156 2,312
For the three months ended June 30, 2025 and 2024, total operating lease expense was $3,114 and $3,377 , respectively. For the six months ended June 30, 2025 and 2024, total operating lease expense was $6,246 and $6,725 , respectively. Short term and variable lease costs were not significant for any period presented.
7. DEBT
Outstanding borrowings consisted of the following at:
| June 30, 2025 | December 31, 2024 | ||||||||||
| Syndicated credit agreement: | |||||||||||
| U.S. Dollar revolving loan | $ | $ | |||||||||
| Term loan | |||||||||||
| European line of credit | |||||||||||
| Outstanding borrowings | |||||||||||
| Less: debt issuance costs | ( | ( | |||||||||
| Total debt | |||||||||||
| Less: current portion of long-term debt | ( | ( | |||||||||
| Long-term debt | $ | $ | |||||||||
Syndicated Credit Agreement
On February 6, 2024, the Company and certain domestic subsidiaries entered into an amendment (the “First Amendment”) to its existing credit agreement with a syndicate of banks, led by KeyBank National Association (the “credit facility”). The First Amendment provides for certain changes to the credit facility, including an increase in the maximum commitment amount from $200,000 to $300,000 . The credit facility allows for revolving loans of up to $200,000 , a $50,000 term loan facility, and a $50,000 delayed draw term loan facility that can be accessed by the Company at its discretion until February 6, 2026 (the “Delayed Draw Term Loan Facility”). The $50,000 term loan facility is amortizable at $625 per quarter beginning on June 30, 2024 through March 31, 2026. Quarterly term loan amortization increases to $938 on June 30, 2026 through March 31, 2028, and increases to $1,250 from June 30, 2028 through December 31, 2028. A balloon payment for the outstanding term loan balance is due upon the credit facility maturity date of February 6, 2029. The credit facility retains a $100,000 accordion feature to increase the commitments under the revolving loan and/or by adding one or more term loans subject to approval by the applicable lenders. The credit facility is secured by certain assets of DMC including accounts receivable, inventory, and fixed assets, including Arcadia Products and its subsidiary, as well as guarantees and share pledges by DMC and its subsidiaries. The revolving loan can also be used to issue bank guarantees to customers to secure their advanced payments. As of June 30, 2025 and December 31, 2024, bank guarantees of $443
Borrowings under the $200,000 revolving loan limit and $50,000 term loan can be in the form of Adjusted Daily Simple Secured Overnight Financing Rate ("SOFR") loans or one month Adjusted Term SOFR loans. Additionally, U.S. dollar borrowings on the revolving loan can be in the form of Base Rate loans (Base Rate borrowings are based on the greater of the administrative agent’s Prime rate, an adjusted Federal Funds rate or an adjusted SOFR rate). SOFR loans currently bear interest at the applicable SOFR rate plus an applicable margin (varying from 2.25 % to 3.25 %). Base Rate loans currently bear interest at the defined Base Rate plus an applicable margin (varying from 1.25 % to 2.25 %).
The credit facility includes various covenants and restrictions, certain of which relate to the payment of dividends or other distributions to stockholders; redemption of capital stock; incurring additional indebtedness; mortgaging, pledging or disposition of major assets; and maintenance of specified ratios.
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The leverage ratio is defined in the credit facility as the ratio of Consolidated Funded Indebtedness (as defined in the credit facility) on the last day of any trailing four quarter period to Consolidated EBITDA (as defined in the credit facility) for such period. The maximum leverage ratio currently permitted by our credit facility is 3.0 to 1.0; provided, however, that the Second Amendment (as defined below) provides for a temporary increase in the maximum leverage ratio under certain circumstances as described below.
The debt service coverage ratio is defined in the credit facility as the ratio of Consolidated EBITDA less the sum of capital distributions paid in cash (other than those made with respect to preferred stock issued under the Operating Agreement), Consolidated Unfunded Capital Expenditures (as defined in the credit facility), and net cash income taxes divided by the sum of cash interest expense, any dividends on the preferred stock paid in cash, and scheduled principal payments on funded indebtedness. Under our credit facility, the minimum debt service coverage ratio permitted is 1.25 to 1.0.
On June 10, 2025, the Company and certain domestic subsidiaries entered into an amendment to the credit facility (the “Second Amendment”). The Second Amendment provides for certain changes to the credit facility, including modifications to the Company’s financial covenants and applicable interest rates to accommodate the possible acquisition of the remaining 40 % minority interest in Arcadia Products. Key provisions of the Second Amendment include a temporary increase in the Company’s maximum leverage ratio to 3.5 x adjusted EBITDA over the trailing 12 months — up from 3.0 x — should either the Put Option or the Call Option be exercised. This elevated leverage limit will apply for the first two quarters following payment of the purchase price of the Put Option or the Call Option, followed by a reduction to 3.25 x in the third quarter, and a return to 3.0 x thereafter. Additionally, proceeds under the Delayed Draw Term Loan Facility may now be held (to the extent drawn on such facility prior to expiration) in a restricted account after the expiration of such facility for purposes of paying the purchase price of the Put Option or the Call Option in the future.
As of June 30, 2025, we were in compliance with all financial covenants and other provisions of our debt agreements.
European Line of Credit
We maintain a line of credit with a German bank with a borrowing capacity of €7,000 for our NobelClad and DynaEnergetics operations in Europe. This line of credit is also used to issue bank guarantees to customers to secure their advanced payments. As of June 30, 2025 and December 31, 2024, we had €637 and €0 , respectively, in outstanding borrowings under this line of credit and bank guarantees of €1,630 and €2,843 , respectively, were secured. The line of credit has open-ended terms and can be canceled by the bank at any time.
8. STOCKHOLDERS PROTECTION RIGHTS AGREEMENT
On June 5, 2024, the Company’s board of directors (the “Board”) adopted the Stockholder Protection Rights Agreement (the “Rights Agreement”) and declared a dividend of one right (“Right”) for each share of the Company’s common stock outstanding at the close of business on June 17, 2024. One Right will also be issued together with each share of common stock issued by the Company after that date, but before the Separation Time (as defined in the Rights Agreement). Each Right initially represents the right to purchase one one-thousandth (0.001 ) of a share of Series B Participating Preferred Stock for $75.00 , subject to adjustment and upon such terms and subject to the conditions set forth in the Rights Agreement. Rights will generally become exercisable if any person (or any persons acting as a group) acquires “Beneficial Ownership” (as defined in the Rights Agreement) of 10 %, or 20 % in the case of certain passive investors, or more of the Company’s outstanding common stock. If Rights become exercisable, all holders of Rights (other than the person, entity or group triggering the Rights Agreement, whose rights will become void and will not be exercisable) will have the right to purchase from the Company for $75.00 , subject to certain potential adjustments, shares of the Company’s common stock having a market value of twice that amount.
On May 30, 2025, the Company entered into Amendment No. 1 to the Rights Agreement (the “Amendment”). Pursuant to the Amendment, the expiration time of the Rights has been extended for one year to June 4, 2026, unless the Rights are earlier redeemed, exchanged or terminated in accordance with the terms and conditions of the Rights Agreement, as amended. Except for the extension of the expiration time, the Rights Agreement remains unaltered and in full force and effect. There is currently no impact on the Company’s Condensed Consolidated Financial Statements.
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9. INCOME TAXES
The effective tax rate for each of the periods reported differs from the U.S. statutory rate primarily due to variation in contribution to consolidated pre-tax income from each jurisdiction for the respective periods, differences between the U.S. and foreign tax rates (which range from 20 % to 32 %), permanent differences between book and taxable income, and income or loss attributable to the redeemable noncontrolling interest holder.
Arcadia Products is treated as a partnership for U.S. tax purposes. With the exception of certain state taxes, income or loss flows through to the shareholders and is taxed at the shareholder level. Tax impacts related to income or loss from Arcadia Products that are included in consolidated pretax results but are attributable to the redeemable noncontrolling interest holder are not included in the consolidated income tax provision.
We assess the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use existing deferred tax assets. Additionally, a three-year cumulative loss at a consolidated financial statement level may be viewed as negative evidence impacting a jurisdiction that by itself is not in a three-year cumulative loss position. During the three and six months ended June 30, 2025, we were in a three-year cumulative loss position at the consolidated financial statement level, driven by historical losses in the U.S. primarily related to the impairment of Arcadia Products’ goodwill in 2024. Accordingly, we have maintained the previously established valuation allowance against the corresponding net deferred tax assets in the U.S. as of June 30, 2025. The Company will continue to monitor the realizability of deferred tax assets and the need for valuation allowances and will record adjustments in the periods in which facts support such changes.
DMC files income tax returns in the U.S. federal jurisdiction, as well as various U.S. state and foreign jurisdictions. Our tax provisions reflect our best estimate of state, local, federal and foreign taxes. In 2024, tax audits in Germany of both our NobelClad and DynaEnergetics subsidiaries commenced for the years 2019 through 2021. While the audits are not unexpected, the outcomes cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner not consistent with our expectations, the Company could be required to adjust its provisions for income taxes in the period such resolution occurs.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law. The OBBBA includes significant tax provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We are currently assessing the impact of the OBBBA on our Condensed Consolidated Financial Statements.
10. BUSINESS SEGMENTS
Our business is organized into three segments: Arcadia Products, DynaEnergetics and NobelClad. In December 2021, DMC acquired a 60 % controlling interest in Arcadia Products. Arcadia Products designs, engineers, fabricates, and finishes aluminum framing systems, windows, curtain walls, storefronts, entrance systems, and interior partitions to the commercial construction market. Additionally, Arcadia Products supplies customized windows and doors to the high-end residential construction market. DynaEnergetics designs, manufactures, markets, and sells perforating systems and associated hardware for the global oil and gas industry. NobelClad produces explosion-welded clad metal plates for use in the construction of corrosion resistant industrial processing equipment and specialized transition joints for commuter rail cars, ships, and liquified natural gas (LNG) processing equipment.
Our reportable segments are separately managed, strategic business units that offer different products. Each segment’s products are marketed to different customer types and require different manufacturing processes and technologies, and each segment has separate financial information available. The Chief Operating Decision Maker ("CODM") uses segment operating income or loss to allocate resources (including employees, property, and financial or capital resources) for each segment in the budget and forecasting process and to assess ongoing performance on a monthly basis. The CODM does not review total assets by segment for purposes of assessing segment performance and allocating resources. As such, the disclosure of total assets by segment has not been included below. The accounting policies of our reportable segments are the same as those described in Note 2 "Significant Accounting Policies". The Company's CODM is our Board of Directors.
Segment information is as follows for the three months ended June 30, 2025:
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| Arcadia Products | DynaEnergetics | NobelClad | Total | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of products sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Stock-based compensation* | |||||||||||||||||||||||
| General and administrative expenses | |||||||||||||||||||||||
| Selling and distribution expenses | |||||||||||||||||||||||
| Amortization of purchased intangible assets | |||||||||||||||||||||||
| Restructuring expenses and asset impairments | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Unallocated corporate expenses | ( | ||||||||||||||||||||||
| Unallocated stock-based compensation* | ( | ||||||||||||||||||||||
| Other expense, net | ( | ||||||||||||||||||||||
| Interest expense, net | ( | ||||||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax provision | |||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||
Segment information is as follows for the six months ended June 30, 2025:
| Arcadia Products | DynaEnergetics | NobelClad | Total | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of products sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Stock-based compensation* | |||||||||||||||||||||||
| General and administrative expenses | |||||||||||||||||||||||
| Selling and distribution expenses | |||||||||||||||||||||||
| Amortization of purchased intangible assets | |||||||||||||||||||||||
| Restructuring expenses and asset impairments | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Unallocated corporate expenses | ( | ||||||||||||||||||||||
| Unallocated stock-based compensation* | ( | ||||||||||||||||||||||
| Other expense, net | ( | ||||||||||||||||||||||
| Interest expense, net | ( | ||||||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax provision | |||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||
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Segment information is as follows for the three months ended June 30, 2024:
| Arcadia Products | DynaEnergetics | NobelClad | Total | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of products sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Stock-based compensation* | |||||||||||||||||||||||
| General and administrative expenses | |||||||||||||||||||||||
| Selling and distribution expenses | |||||||||||||||||||||||
| Amortization of purchased intangible assets | |||||||||||||||||||||||
| Restructuring expenses and asset impairments | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Unallocated corporate expenses | ( | ||||||||||||||||||||||
| Unallocated stock-based compensation* | ( | ||||||||||||||||||||||
| Other expense, net | ( | ||||||||||||||||||||||
| Interest expense, net | ( | ||||||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax provision | |||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||
Segment information is as follows for the six months ended June 30, 2024:
| Arcadia Products | DynaEnergetics | NobelClad | Total | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of products sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Stock-based compensation* | |||||||||||||||||||||||
| General and administrative expenses | |||||||||||||||||||||||
| Selling and distribution expenses | |||||||||||||||||||||||
| Amortization of purchased intangible assets | |||||||||||||||||||||||
| Restructuring expenses and asset impairments | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Unallocated corporate expenses | ( | ||||||||||||||||||||||
| Unallocated stock-based compensation* | ( | ||||||||||||||||||||||
| Other expense, net | ( | ||||||||||||||||||||||
| Interest expense, net | ( | ||||||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax provision | |||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||
*Stock-based compensation is not allocated to wholly owned segments DynaEnergetics and NobelClad. Stock-based compensation is allocated to the Arcadia Products segment as 60 40
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| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Depreciation and amortization: | |||||||||||||||||||||||
| Arcadia Products | $ | $ | $ | $ | |||||||||||||||||||
| DynaEnergetics | |||||||||||||||||||||||
| NobelClad | |||||||||||||||||||||||
| Segment depreciation and amortization | |||||||||||||||||||||||
| Corporate and other | |||||||||||||||||||||||
| Consolidated depreciation and amortization | $ | $ | $ | $ | |||||||||||||||||||
The disaggregation of revenue earned from contracts with customers is based on the geographic location of the customer. For Arcadia Products, net sales have been presented consistent with United States regional definitions as provided by the American Institute of Architects. For DynaEnergetics and NobelClad, all net sales are from products shipped from our manufacturing facilities and distribution centers located in the United States, Germany, and Canada.
Arcadia Products
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| West | $ | $ | $ | ||||||||||||||||||||
| South | |||||||||||||||||||||||
| Northeast | |||||||||||||||||||||||
| Midwest | |||||||||||||||||||||||
| Total Arcadia Products | $ | $ | $ | $ | |||||||||||||||||||
DynaEnergetics
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
| Canada | |||||||||||||||||||||||
| Ukraine | |||||||||||||||||||||||
| Indonesia | |||||||||||||||||||||||
| Oman | |||||||||||||||||||||||
| India | |||||||||||||||||||||||
Rest of the world(1) | |||||||||||||||||||||||
| Total DynaEnergetics | $ | $ | $ | $ | |||||||||||||||||||
(1) Rest of the world does not include any individual country comprising sales greater than 3% of total DynaEnergetics revenue.
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NobelClad
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
| Germany | |||||||||||||||||||||||
| Canada | |||||||||||||||||||||||
| Belgium | |||||||||||||||||||||||
| South Korea | |||||||||||||||||||||||
| France | |||||||||||||||||||||||
| Saudi Arabia | |||||||||||||||||||||||
| Netherlands | |||||||||||||||||||||||
| China | |||||||||||||||||||||||
| United Arab Emirates | |||||||||||||||||||||||
| Bahrain | |||||||||||||||||||||||
| South Africa | |||||||||||||||||||||||
| Australia | |||||||||||||||||||||||
Rest of the world (1) | |||||||||||||||||||||||
| Total NobelClad | $ | $ | $ | $ | |||||||||||||||||||
(1) Rest of the world does not include any individual country comprising sales greater than 3% of total NobelClad revenue.
During the three and six months ended June 30, 2025, one DynaEnergetics customer accounted for approximately 24 % and 25 %, respectively, of consolidated net sales. During the three and six months ended June 30, 2024, one DynaEnergetics customer accounted for approximately 22 % and 23 %, respectively, of consolidated net sales. Additionally, the same DynaEnergetics customer accounted for approximately 29 % and 30 % of consolidated accounts receivable as of June 30, 2025 and December 31, 2024, respectively.
11. DERIVATIVE INSTRUMENTS
We are exposed to foreign currency exchange risk resulting from fluctuations in exchange rates, primarily the U.S. dollar to the euro, the U.S. dollar to the Canadian dollar and, to a lesser extent, other currencies, arising from intercompany and third-party transactions entered into by our subsidiaries that are denominated in currencies other than their functional currency. Changes in exchange rates with respect to these transactions result in unrealized gains or losses if such transactions are unsettled at the end of the reporting period or realized gains or losses at settlement of the transaction. We use foreign currency forward contracts to offset foreign exchange rate fluctuations on foreign currency denominated asset and liability positions. None of these contracts are designated as accounting hedges, and all changes in the fair value of forward contracts are recognized in “Other expense, net” within our Condensed Consolidated Statements of Operations.
We execute derivatives with a specialized foreign exchange brokerage firm as well as other large financial institutions. The primary credit risk inherent in derivative agreements is the possibility that a loss may occur from the nonperformance of a counterparty to the agreements. We perform a review of the credit risk of our counterparties at the inception of the contract and on an ongoing basis. We anticipate that our counterparties will be able to fully satisfy their obligations under the agreements but will take action if doubt arises regarding the counterparties’ ability to perform.
As of June 30, 2025 and December 31, 2024, the net notional amounts of forward contracts the Company held were $8,045 and $8,331 , respectively. At June 30, 2025 and December 31, 2024, the fair value of outstanding forward contracts was $0
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The following table reflects the location and amount of net gains (losses) from hedging activities for the periods presented. These hedging net gains (losses) offset foreign currency gains and losses recorded in the normal course of business, which are not shown below.
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||
| Derivative | Statements of Operations Location | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||
| Foreign currency contracts | Other expense, net | $ | $ | ( | $ | $ | ( | |||||||||||||||||||
12. COMMITMENTS AND CONTINGENCIES
Contingent Liabilities
The Company records an accrual for contingent liabilities when a loss is both probable and reasonably estimable. If some amount within a range of loss appears to be a better estimate than any other amount within the range, that amount is accrued. When no amount within a range of loss appears to be a better estimate than any other amount, the lowest amount in the range is accrued.
Legal Proceedings
In the ordinary course of its business, the Company is involved in a number of lawsuits and claims, both actual and potential. In addition to the matters discussed below, various other lawsuits, claims, and proceedings have been or may be instituted or asserted against the Company, including those pertaining to environmental, safety and health, commercial, tax, product liability, intellectual property infringement and employment matters, and other actions and claims arising out of the normal course of business. Although it is difficult to accurately predict the outcome of any such proceedings, based on facts currently available, management believes that the disposition of these other matters that are pending or asserted will not have a material adverse effect, individually or in the aggregate, on the financial position of the Company.
Stockholder Litigation
On December 6, 2024, Samuel Garson, individually and on behalf of a putative class, filed a securities class action lawsuit in the United States District Court for the District of Colorado (the “District Court”) against the Company and other defendants (collectively, the “Defendants”). The complaint asserted violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b5-1 promulgated thereunder on behalf of a putative class of all persons who purchased the Company’s securities between May 3, 2024 and November 4, 2024. In particular, the complaint alleged that the Defendants made false and misleading statements during the class period concerning the Company’s business resulting in injury to the purported class members. On January 27, 2025, a second securities class action lawsuit was filed in the District Court by Alessandro Laurent, individually and of behalf of a putative class, asserting substantially the same allegations, but on behalf of all purchasers of the Company’s securities between January 29, 2024 and November 4, 2024. Both complaints sought certification of a class of purchasers of the Company’s securities during the respective class periods and an award of damages, interest, costs and expenses (including attorney’s fees) to the respective plaintiffs and class members. On February 5, 2025, the District Court ordered the two lawsuits consolidated, and on June 23, 2025, the lead plaintiff in the consolidated case filed an amended complaint adding additional allegations within the class period.
On June 6, 2025, Michael Lewis filed a related stockholder derivative lawsuit in the District Court against the Company as nominal defendant and certain directors and officers, alleging breaches of fiduciary duties under Delaware law and violations of Section 14(a) of the Exchange Act, based in significant part on the allegations made in the Garson and Laurent complaints. On July 16, 2025, Lee Runey filed another related stockholder derivative lawsuit, also in the District Court, against the Company as nominal defendant and certain directors and officers, alleging breaches of fiduciary duties and other similar claims under Delaware law as well as violations of Section 14(a) of the Exchange Act, based in significant part on the allegations made in Lewis and the amended complaint in Garson.
The Company intends to vigorously defend itself against the foregoing actions.
Due to the nature of these matters and inherent uncertainties, it is not possible to provide an evaluation of the likelihood of an unfavorable outcome or an estimate of the amount or range of potential loss, if any, in these circumstances.
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Environmental Matter
In 2024, the Company entered into a Consent Decree with Los Angeles Waterkeeper (Waterkeeper) to settle a citizen suit alleging stormwater-related violations of the Clean Water Act at three Arcadia Products facilities located in Vernon, California. The Consent Decree requires the Company to undertake certain improvements to its stormwater management infrastructure and practices at all three facilities over the next several years. It also required the Company to reimburse Waterkeeper for $70 in claimed costs and spend $100 on a Supplemental Environmental Project. The Consent Decree was entered by the U.S. District Court for the Central District of California following a U.S. Department of Justice 45-day review period.
The Company also has been in contact with the Los Angeles Regional Water Quality Control Board (LARWQCB) to address certain alleged violations of stormwater regulatory requirements that may be subject to mandatory minimum penalties under applicable California law. The Company cannot predict how this matter will be resolved, but has accrued $762 in aggregate to address potential outstanding claims.
13. STRATEGIC REVIEW AND RELATED EXPENSES
During the first quarter of 2024, the Company announced that the Board had initiated a review of strategic alternatives for the DynaEnergetics and NobelClad segments. In conjunction with the Board’s consideration of various strategic, business, and financial alternatives, the Company incurred significant expenses. In October 2024, the Company announced that the Board was no longer actively marketing the DynaEnergetics and NobelClad segments. However, in response to subsequent inquiries and actions of certain stockholders, the Company has continued to incur significant expenses as the Board satisfies its fiduciary obligations with respect to such inquiries. During the three months ended June 30, 2025, such expenses incurred were $775 and related primarily to professional service fees. During the six months ended June 30, 2025, strategic review and related expenses were $2,073 , and primarily included $1,507 in professional service fees and $366 in employee retention compensation, including $36 of stock-based compensation.
During the three months ended June 30, 2024, strategic review expenses incurred were $2,020 and primarily included $1,030 in professional service fees and $863 in employee retention compensation, including $106 of stock-based compensation. During the six months ended June 30, 2024, strategic review and related expenses incurred were $4,189 and primarily included $2,170 in professional service fees and $1,351 in employee retention compensation, including $178 of stock-based compensation.
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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with our historical Consolidated Financial Statements and notes that are included in our Annual Report filed on Form 10-K for the year ended December 31, 2024.
Unless stated otherwise, all dollar figures are presented in thousands (000s).
Overview
General
DMC Global Inc. (“DMC”, "we", "us", "our", or the "Company") owns and operates Arcadia Products, DynaEnergetics and NobelClad, three innovative, asset-light manufacturing businesses that provide differentiated products and engineered solutions to segments of the construction, energy, industrial processing and transportation markets. Our businesses seek to capitalize on their product and service differentiation to expand profit margins, increase cash flow and enhance shareholder value. Based in Broomfield, Colorado, DMC trades on Nasdaq under the symbol “BOOM.”
Arcadia Products
On December 23, 2021, DMC completed the acquisition of 60% of the membership interests in Arcadia Products, LLC, a Colorado limited liability company resulting from the conversion of Arcadia, Inc. (collectively, “Arcadia Products”). Arcadia Products designs, engineers, fabricates, and finishes aluminum framing systems, windows, curtain walls, storefronts, entrance systems, and interior partitions to the commercial construction market. Additionally, Arcadia Products supplies customized windows and doors to the high-end residential construction market.
Cost of products sold for Arcadia Products includes the cost of aluminum, paint, and other raw materials used in manufacturing as well as employee compensation and benefits, manufacturing facility lease expense, depreciation of manufacturing equipment, supplies and other manufacturing overhead expenses.
DynaEnergetics
DynaEnergetics designs, manufactures, markets, and sells perforating systems and associated hardware for the global oil and gas industry. These products are primarily sold to oilfield service companies in the U.S., Europe, Canada, Africa, the Middle East, and Asia. The market for perforating products, which are used during the well completion process, generally corresponds with oil and gas exploration and production activity. Well completion operations are increasingly complex, which in turn has increased the demand for intrinsically-safe, reliable and technically advanced perforating systems.
Cost of products sold for DynaEnergetics includes the cost of metals, explosives and other raw materials used to manufacture shaped charges, detonating products and perforating guns as well as employee compensation and benefits, depreciation of manufacturing facilities and equipment, supplies and other manufacturing overhead expenses.
NobelClad
NobelClad produces explosion-welded clad metal plates for use in the construction of corrosion resistant industrial processing equipment and specialized transition joints for commuter rail cars, ships, and liquified natural gas (LNG) processing equipment. While most demand for our products is driven by maintenance and retrofit projects at existing plants and facilities, new projects for petrochemical processing, oil refining, and aluminum smelting facilities also account for a significant portion of total demand. These industries tend to be cyclical in nature and the timing of new order inflow remains difficult to predict. We use backlog, defined as all unfilled firm purchase orders and commitments at a point in time, to measure the immediate outlook for our NobelClad business. Most firm purchase orders and commitments are realized and shipped within twelve months. NobelClad's backlog was $37,263 at June 30, 2025 compared to $48,885 at December 31, 2024.
Cost of products sold for NobelClad includes the cost of metals, explosive powders and other raw materials used to manufacture clad metal plates and transition joints as well as employee compensation and benefits, outside processing costs, depreciation of manufacturing facilities and equipment, manufacturing facility lease expense, supplies and other manufacturing overhead expenses.
Factors Affecting Results
•Consolidated sales were $155,487 in the second quarter of 2025 versus $171,179 in the second quarter of 2024, a decrease of 9%. The decline in consolidated sales performance was driven by lower sales at Arcadia Products and DynaEnergetics.
•Arcadia Products reported sales of $61,980 in the second quarter of 2025, representing a decrease of 11% compared to the second quarter of 2024. The decrease was primarily attributable to lower sales volumes in commercial exterior and high-end residential markets.
•DynaEnergetics’ sales of $66,862 in the second quarter of 2025 represented a 12% decrease compared to the second quarter of 2024. The decline was due to a decrease in volume of DynaStage® (DS) perforating systems attributable to lower well completions in North America, pricing decreases due to industry consolidation in the United States, and a reduction in international sales due to project timing.
•NobelClad’s sales of $26,645 in the second quarter of 2025 increased 6% compared to the second quarter of 2024 primarily due to timing of shipments out of backlog.
•The Company’s leverage ratio, calculated in accordance with its credit facility, was 1.23 to 1.0 as of June 30, 2025 in comparison to the maximum ratio permitted of 3.0 to 1.0. The Company’s adjusted leverage ratio, calculated using net debt, a non-GAAP measure, as of June 30, 2025, was 0.98 to 1.0.
Outlook
Our three manufacturing businesses continue to closely monitor evolving U.S. and reciprocal tariff policies. In addition, our DynaEnergetics and NobelClad businesses are tracking the implications of continued volatility in U.S. and global energy markets. If our businesses cannot mitigate tariff impacts or if tariffs significantly reduce product demand, both net sales and profitability will decline. For further details on potential tariff impacts, see Part II, Item 1A. Risk Factors.
Our Arcadia Products business has rightsized its high-end residential cost structure to align with current market conditions, which include persistently high interest rates and generally lower construction activity. Management also continues to focus on its core commercial operations, which generate approximately 75% of the segment’s sales.
DynaEnergetics is pursuing a range of initiatives aimed at reducing costs and increasing market share. These efforts are intended to offset an expected decline in demand during the second half of the year due to lower oil prices and reduced well completion activity.
At NobelClad, continued uncertainty related to tariffs has reduced bookings activity. Order backlog at the end of the second quarter was $37,263 versus $41,014 at the end of the first quarter. NobelClad continues to believe order activity could improve once customers gain clarity on future tariff actions.
Use of Non-GAAP Financial Measures
In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States (GAAP), the Company also discloses certain non-GAAP financial measures that we use in operational and financial decision making. Non-GAAP financial measures include the following:
•EBITDA: defined as net income (loss) plus net interest, taxes, depreciation and amortization.
•Adjusted EBITDA: excludes from EBITDA stock-based compensation, restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance (as further described in the tables below).
•Adjusted EBITDA attributable to DMC Global Inc.: excludes the Adjusted EBITDA attributable to the 40% redeemable noncontrolling interest in Arcadia Products.
•Adjusted EBITDA for DMC business segments: defined as operating income (loss) plus depreciation, amortization, allocated stock-based compensation (if applicable), restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC's operating performance.
•Adjusted net income (loss): defined as net income (loss) attributable to DMC Global Inc. stockholders prior to the adjustment of redeemable noncontrolling interest plus restructuring expenses and asset impairment charges (if
applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC's operating performance.
•Adjusted diluted earnings per share: defined as diluted earnings per share attributable to DMC Global Inc. stockholders (exclusive of adjustment of redeemable noncontrolling interest) plus restructuring expenses and asset impairment charges (if applicable) and, when appropriate, nonrecurring items that management does not utilize in assessing DMC’s operating performance.
•Net debt: defined as total debt less total cash, cash equivalents and marketable securities.
•Free-cash flow: defined as cash flows from operating activities less net acquisitions of property, plant and equipment.
Management believes providing these additional financial measures is useful to investors in understanding the Company’s operating performance, excluding the effects of restructuring, impairment, and other nonrecurring charges, as well as its liquidity. Management typically monitors the business utilizing the above non-GAAP measures, in addition to GAAP results, to understand and compare operating results across accounting periods, and certain management incentive awards are based, in part, on these measures. The presence of non-GAAP financial measures in this report is not intended to suggest that such measures be considered in isolation or as a substitute for, or as superior to, DMC’s GAAP information, and investors are cautioned that the non-GAAP financial measures are limited in their usefulness. Given that not all companies use identical calculations, DMC’s presentation of non-GAAP financial measures may not be comparable to similarly titled measures of other companies.
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Consolidated Results of Operations
Three months ended June 30, 2025 compared with three months ended June 30, 2024
| Three months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 155,487 | $ | 171,179 | $ | (15,692) | (9 | %) | |||||||||||||||
| Gross profit | 36,731 | 46,413 | (9,682) | (21 | %) | ||||||||||||||||||
| Gross profit percentage | 23.6 | % | 27.1 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 15,905 | 15,623 | 282 | 2 | % | ||||||||||||||||||
| % of net sales | 10.2 | % | 9.1 | % | |||||||||||||||||||
| Selling and distribution expenses | 10,242 | 11,499 | (1,257) | (11 | %) | ||||||||||||||||||
| % of net sales | 6.6 | % | 6.7 | % | |||||||||||||||||||
| Amortization of purchased intangible assets | 4,763 | 5,307 | (544) | (10 | %) | ||||||||||||||||||
| % of net sales | 3.1 | % | 3.1 | % | |||||||||||||||||||
| Strategic review and related expenses | 775 | 2,020 | (1,245) | (62 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 1,149 | 279 | 870 | 312 | % | ||||||||||||||||||
| Operating income | 3,897 | 11,685 | (7,788) | (67 | %) | ||||||||||||||||||
| Other expense, net | (346) | (284) | (62) | 22 | % | ||||||||||||||||||
| Interest expense, net | (1,811) | (2,316) | 505 | (22 | %) | ||||||||||||||||||
| Income before income taxes | 1,740 | 9,085 | (7,345) | (81 | %) | ||||||||||||||||||
| Income tax provision | 1,419 | 2,792 | (1,373) | (49 | %) | ||||||||||||||||||
| Net income | 321 | 6,293 | (5,972) | (95 | %) | ||||||||||||||||||
| Less: Net income attributable to redeemable noncontrolling interest | 205 | 2,281 | (2,076) | (91 | %) | ||||||||||||||||||
| Net income attributable to DMC Global Inc. | 116 | 4,012 | (3,896) | (97 | %) | ||||||||||||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 13,538 | $ | 19,420 | $ | (5,882) | (30 | %) | |||||||||||||||
Net sales were $155,487 for the three months ended June 30, 2025, or a decrease of 9% compared with the same period in 2024, due to lower sales at Arcadia Products and DynaEnergetics. The 11% decline at Arcadia Products was due to lower sales volumes in commercial exterior and high-end residential markets. The 12% decline at DynaEnergetics was due to a decrease in volume of DS perforating systems attributable to lower well completions in North America, pricing decreases due to industry consolidation in the United States, and lower international sales due to project timing. These decreases were partially offset by a 6% increase in net sales at NobelClad. The increase in net sales at NobelClad was due to the timing of shipments out of backlog.
Gross profit percentage was 23.6% versus 27.1% in 2024. The decline compared to the prior year was primarily attributable to lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales at Arcadia and a less favorable project and regional mix at NobelClad.
General and administrative expenses increased $282 for the three months ended June 30, 2025 compared with the same period in the prior year primarily due to professional service fees incurred to secure a permanent Chief Executive Officer (“executive transition costs”) of $520 and higher outside services costs of $300, which were partially offset by lower expenses related to the Waterkeeper matter of $450.
Selling and distribution expenses decreased $1,257 for the three months ended June 30, 2025 compared with the same period in 2024 driven by lower bad debt expense of $570, a decrease in selling costs at DynaEnergetics of $402 due to lower sales volumes, and a reduction in marketing consulting costs of $264.
Amortization of purchased intangible assets decreased $544 for the three months ended June 30, 2025 compared to the same period in 2024 as the Arcadia Products customer relationship purchased intangible asset is amortized using an accelerated amortization method.
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Strategic review and related expenses of $775 for the three months ended June 30, 2025 included primarily professional service fees.
For the three months ended June 30, 2024, strategic review expenses incurred were $2,020 and primarily included $1,030 in professional service fees and $863 in employee retention compensation, including $106 of stock-based compensation.
Restructuring expenses and asset impairments of $1,149 for the three months ended June 30, 2025 included an asset impairment charge and related contract termination costs associated with exiting a lease at DynaEnergetics totaling $605 and $544 of employee severance associated with headcount reductions across all three business segments.
Income tax provision of $1,419 was recorded on income before income taxes of $1,740 for the three months ended June 30, 2025. Our most significant operations are in the United States, which has a 21% statutory income tax rate, and Germany, which has a 32% combined statutory income tax rate. The mix of income or loss before income taxes between these jurisdictions is one of the primary drivers of the difference between our 21% statutory tax rate and our effective tax rate. Additionally, the effective rate was impacted unfavorably by state taxes and a valuation allowance in the U.S. which results in no benefit for losses generated domestically. We recorded an income tax provision of $2,792 on income before income taxes of $9,085 for the three months ended June 30, 2024. The prior year rate was impacted unfavorably by the geographic mix of pretax income, state taxes and certain compensation expenses that are not tax deductible in the U.S. The operating results of Arcadia Products that are attributable to the redeemable noncontrolling interest holder are not taxed at DMC, which resulted in a partially offsetting favorable impact to the effective tax rate.
Net income attributable to DMC Global Inc. for the three months ended June 30, 2025 was $116, compared to $4,012 for the same period in 2024 primarily due to the factors discussed above.
Adjusted EBITDA decreased for the three months ended June 30, 2025 compared with the same period in 2024 primarily due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
| Three months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Net income | $ | 321 | $ | 6,293 | |||||||
| Interest expense, net | 1,811 | 2,316 | |||||||||
| Income tax provision | 1,419 | 2,792 | |||||||||
| Depreciation | 3,707 | 3,431 | |||||||||
| Amortization of purchased intangible assets | 4,763 | 5,307 | |||||||||
| EBITDA | 12,021 | 20,139 | |||||||||
| Stock-based compensation | 1,417 | 1,676 | |||||||||
| Strategic review and related expenses | 775 | 2,020 | |||||||||
| Restructuring expenses and asset impairments | 1,149 | 279 | |||||||||
Executive transition costs | 520 | — | |||||||||
| Other expense, net | 346 | 284 | |||||||||
| Adjusted EBITDA | 16,228 | 24,398 | |||||||||
| Less: adjusted EBITDA attributable to redeemable noncontrolling interest | (2,690) | (4,978) | |||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 13,538 | $ | 19,420 | |||||||
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Adjusted Net Income and Adjusted Diluted Earnings per Share decreased for the three months ended June 30, 2025 compared with the same period in 2024 primarily due to the factors discussed above. See "Use of Non-GAAP Financial Measures" above for the explanation of the use of non-GAAP measures. The following is a reconciliation of the most directly comparable GAAP measures to Adjusted Net Income and Adjusted Diluted Earnings Per Share.
| Three months ended June 30, 2025 | |||||||||||||||||||||||||||||
| Amount | Per Share (1) | ||||||||||||||||||||||||||||
Net income attributable to DMC Global Inc. (2) | $ | 116 | $ | — | |||||||||||||||||||||||||
| Strategic review and related expenses, net of tax | 775 | 0.04 | |||||||||||||||||||||||||||
| Restructuring expenses and asset impairments, net of tax | 1,062 | 0.05 | |||||||||||||||||||||||||||
Executive transition costs, net of tax | 520 | 0.03 | |||||||||||||||||||||||||||
| As adjusted | $ | 2,473 | $ | 0.12 | |||||||||||||||||||||||||
(1) Calculated using diluted weighted average shares outstanding of 20,134,760
(2) Net income attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest.
| Three months ended June 30, 2024 | |||||||||||||||||||||||||||||
| Amount | Per Share (1) | ||||||||||||||||||||||||||||
Net income attributable to DMC Global Inc. (2) | $ | 4,012 | $ | 0.20 | |||||||||||||||||||||||||
| Strategic review and related expenses, net of tax | 1,538 | 0.08 | |||||||||||||||||||||||||||
| Restructuring expenses and asset impairments, net of tax | 125 | 0.01 | |||||||||||||||||||||||||||
| As adjusted | $ | 5,675 | $ | 0.29 | |||||||||||||||||||||||||
(1) Calculated using diluted weighted average shares outstanding of 19,671,169
(2) Net income attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest.
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Six months ended June 30, 2025 compared with six months ended June 30, 2024
| Six months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 314,777 | $ | 338,048 | $ | (23,271) | (7 | %) | |||||||||||||||
| Gross profit | 77,930 | 88,765 | (10,835) | (12 | %) | ||||||||||||||||||
| Gross profit percentage | 24.8 | % | 26.3 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 32,579 | 31,603 | 976 | 3 | % | ||||||||||||||||||
| % of net sales | 10.3 | % | 9.3 | % | |||||||||||||||||||
| Selling and distribution expenses | 21,868 | 23,722 | (1,854) | (8 | %) | ||||||||||||||||||
| % of net sales | 6.9 | % | 7.0 | % | |||||||||||||||||||
| Amortization of purchased intangible assets | 9,526 | 10,599 | (1,073) | (10 | %) | ||||||||||||||||||
| % of net sales | 3.0 | % | 3.1 | % | |||||||||||||||||||
| Strategic review and related expenses | 2,073 | 4,189 | (2,116) | (51 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 1,474 | 279 | 1,195 | 428 | % | ||||||||||||||||||
| Operating income | 10,410 | 18,373 | (7,963) | (43 | %) | ||||||||||||||||||
| Other expense, net | (564) | (693) | 129 | (19 | %) | ||||||||||||||||||
| Interest expense, net | (3,510) | (4,633) | 1,123 | (24 | %) | ||||||||||||||||||
| Income before income taxes | 6,336 | 13,047 | (6,711) | (51 | %) | ||||||||||||||||||
| Income tax provision | 4,152 | 4,435 | (283) | (6 | %) | ||||||||||||||||||
| Net income | 2,184 | 8,612 | (6,428) | (75 | %) | ||||||||||||||||||
| Net income attributable to redeemable noncontrolling interest | 1,391 | 2,037 | (646) | (32 | %) | ||||||||||||||||||
| Net income attributable to DMC Global Inc. | 793 | 6,575 | (5,782) | (88 | %) | ||||||||||||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 27,929 | $ | 36,103 | $ | (8,174) | (23 | %) | |||||||||||||||
Net sales were $314,777 for the six months ended June 30, 2025, a decrease of 7% compared with the same period in 2024, primarily due to lower sales at DynaEnergetics. The 14% decline at DynaEnergetics was due to a decrease in volume of DS perforating systems attributable to lower well completions in North America, pricing decreases due to industry consolidation in the United States, and lower international sales due to project timing.
Gross profit percentage was 24.8% versus 26.3% in 2024. The decline compared to the prior year was primarily attributable to lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales at Arcadia and DynaEnergetics, as well as a less favorable project and regional mix at NobelClad.
General and administrative expenses increased $976 for the six months ended June 30, 2025 compared with the same period in 2024. The year-over-year increase was primarily attributable to executive transition costs of $520, higher compensation costs of $854, and higher outside services costs of $422. These increases were partially offset by lower expenses related to the Waterkeeper matter of $450 and a reduction in business related travel of $410.
Selling and distribution expenses decreased $1,854 for the six months ended June 30, 2025 compared with the same period in 2024. The year-over-year decrease was driven by lower selling costs of $568 at DynaEnergetics due to decreased sales volumes, a reduction in marketing consulting costs of $449, lower bad debt expense of $340, decreased compensation costs of $276, and lower business related travel of $189.
Amortization of purchased intangible assets decreased $1,073 for the six months ended June 30, 2025 compared to the same period in 2024 as the Arcadia Products customer relationship purchased intangible asset is amortized using an accelerated amortization method.
Strategic review and related expenses of $2,073 for the six months ended June 30, 2025 relate primarily to $1,507 in professional service fees and $366 in employee retention compensation, including $36 of stock-based compensation.
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For the six months ended June 30, 2024, strategic review and related expenses were $4,189 and primarily included $2,170 in professional service fees and $1,351 in employee retention compensation, including $178 of stock-based compensation.
Restructuring expenses and asset impairments of $1,474 for the six months ended June 30, 2025 include an asset impairment charge and related contract termination costs associated with exiting a lease at DynaEnergetics totaling $605 and $869 of employee severance associated with headcount reductions across all three business segments.
Income tax provision of $4,152 was recorded on income before income taxes of $6,336 for the six months ended June 30, 2025. Our most significant operations are in the United States, which has a 21% statutory income tax rate, and Germany, which has a 32% combined statutory income tax rate. The mix of income or loss before income taxes between these jurisdictions is one of the primary drivers of the difference between our 21% statutory tax rate and our effective tax rate. Additionally, the effective rate was impacted unfavorably by state taxes and a valuation allowance in the U.S. which results in no benefit for losses generated domestically. We recorded an income tax provision of $4,435 on income before income taxes of $13,047 for the six months ended June 30, 2024. The prior year rate was impacted unfavorably by the geographic mix of pretax income, state taxes and certain compensation expenses that are not tax deductible in the U.S. The operating results of Arcadia Products that are attributable to the redeemable noncontrolling interest holder are not taxed at DMC, which resulted in a partially offsetting favorable impact to the effective tax rate.
Net income attributable to DMC Global Inc. for the six months ended June 30, 2025 was $793, compared to $6,575 for the same period in 2024 primarily due to the factors discussed above.
Adjusted EBITDA decreased for the six months ended June 30, 2025 compared with the same period in 2024 primarily due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
| Six months ended June 30, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| Net income | $ | 2,184 | $ | 8,612 | ||||||||||
| Interest expense, net | 3,510 | 4,633 | ||||||||||||
| Income tax provision | 4,152 | 4,435 | ||||||||||||
| Depreciation | 7,367 | 6,850 | ||||||||||||
| Amortization of purchased intangible assets | 9,526 | 10,599 | ||||||||||||
| EBITDA | 26,739 | 35,129 | ||||||||||||
| Stock-based compensation | 2,980 | 3,153 | ||||||||||||
| Strategic review and related expenses | 2,073 | 4,189 | ||||||||||||
| Restructuring expenses and asset impairments | 1,474 | 279 | ||||||||||||
Executive transition costs | 520 | — | ||||||||||||
| Other expense, net | 564 | 693 | ||||||||||||
| Adjusted EBITDA | 34,350 | 43,443 | ||||||||||||
| Less: adjusted EBITDA attributable to redeemable noncontrolling interest | (6,421) | (7,340) | ||||||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 27,929 | $ | 36,103 | ||||||||||
Adjusted Net Income and Adjusted Diluted Earnings per Share decreased for the six months ended June 30, 2025 compared with the same period in 2024 primarily due to the factors discussed above. See "Use of Non-GAAP Financial Measures" above for the explanation of the use of non-GAAP measures. The following is a reconciliation of the most directly comparable GAAP measures to Adjusted Net Income and Adjusted Diluted Earnings Per Share.
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| Six months ended June 30, 2025 | ||||||||||||||
| Amount | Per Share (1) | |||||||||||||
Net income attributable to DMC Global Inc. (2) | $ | 793 | $ | 0.04 | ||||||||||
| Strategic review and related expenses, net of tax | 2,073 | 0.10 | ||||||||||||
| Restructuring expenses and asset impairments, net of tax | 1,257 | 0.06 | ||||||||||||
Executive transition costs, net of tax | 520 | 0.03 | ||||||||||||
| As adjusted | $ | 4,643 | $ | 0.23 | ||||||||||
(1) Calculated using diluted weighted average shares outstanding of 19,861,073
(2) Net loss attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest.
| Six months ended June 30, 2024 | ||||||||||||||
| Amount | Per Share (1) | |||||||||||||
Net income attributable to DMC Global Inc. (2) | $ | 6,575 | 0.33 | |||||||||||
| Strategic review and related expenses, net of tax | 3,142 | 0.16 | ||||||||||||
| Restructuring expenses and asset impairments, net of tax | 125 | 0.01 | ||||||||||||
| As adjusted | $ | 9,842 | $ | 0.50 | ||||||||||
(1) Calculated using diluted weighted average shares outstanding of 19,647,005
(2) Net income attributable to DMC Global Inc. prior to the adjustment of redeemable noncontrolling interest.
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Business Segment Financial Information
We primarily evaluate performance and allocate resources based on segment revenues, operating income and Adjusted EBITDA as well as projected future performance. Segment operating income is defined as revenues less expenses identifiable to the segment. DMC consolidated operating income and Adjusted EBITDA include unallocated corporate expenses and unallocated stock-based compensation expense. Stock-based compensation is not allocated to wholly owned segments, DynaEnergetics and NobelClad. Stock-based compensation is allocated to the Arcadia Products segment as 60% of such expense is attributable to the Company, whereas the remaining 40% is attributable to the redeemable noncontrolling interest holder. Segment operating income will reconcile to consolidated income before income taxes by deducting unallocated corporate expenses, unallocated stock-based compensation, other expense, net, and interest expense, net.
Arcadia Products
Three months ended June 30, 2025 compared with three months ended June 30, 2024
| Three months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 61,980 | $ | 69,748 | $ | (7,768) | (11 | %) | |||||||||||||||
| Gross profit | 16,250 | 23,157 | (6,907) | (30 | %) | ||||||||||||||||||
| Gross profit percentage | 26.2 | % | 33.2 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 6,489 | 7,765 | (1,276) | (16 | %) | ||||||||||||||||||
| Selling and distribution expenses | 4,290 | 4,116 | 174 | 4 | % | ||||||||||||||||||
| Amortization of purchased intangible assets | 4,763 | 5,278 | (515) | (10 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 192 | 279 | (87) | (31 | %) | ||||||||||||||||||
| Operating income | 516 | 5,719 | (5,203) | (91 | %) | ||||||||||||||||||
| Adjusted EBITDA | 6,725 | 12,445 | (5,720) | (46 | %) | ||||||||||||||||||
| Less: adjusted EBITDA attributable to redeemable noncontrolling interest | (2,690) | (4,978) | (2,288) | (46 | %) | ||||||||||||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 4,035 | $ | 7,467 | (3,432) | (46 | %) | ||||||||||||||||
Net sales decreased $7,768 for the three months ended June 30, 2025 compared to the same period in 2024 primarily due to lower sales volumes in commercial exterior and high-end residential markets.
Gross profit percentage decreased to 26.2% for the three months ended June 30, 2025 compared to the same period in 2024 primarily due to lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales mentioned above.
General and administrative expenses decreased $1,276 for the three months ended June 30, 2025 compared with the same period in prior year primarily due to lower compensation costs of $645 as a result of a reduction in headcount, lower expenses related to the Waterkeeper matter of $450, and a reduction in business related travel of $170.
Selling and distribution expenses increased $174 for the three months ended June 30, 2025 compared with the same period in 2024 primarily driven by higher incentive compensation costs.
Amortization of purchased intangible assets decreased $515 for the three months ended June 30, 2025 compared to the same period in 2024 as the customer relationship purchased intangible asset is amortized using an accelerated amortization method.
Restructuring expenses and asset impairments of $192 for the three months ended June 30, 2025 relate to employee severance associated with headcount reductions.
Operating income of $516 for the three months ended June 30, 2025 decreased compared to operating income of $5,719 in the same period in 2024 due primarily to lower gross profit.
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Adjusted EBITDA decreased for the three months ended June 30, 2025 compared with the same period in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
| Three months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating income | $ | 516 | $ | 5,719 | |||||||
| Adjustments: | |||||||||||
| Depreciation | 1,016 | 888 | |||||||||
| Amortization of purchased intangible assets | 4,763 | 5,278 | |||||||||
| Stock-based compensation | 238 | 281 | |||||||||
| Restructuring expenses and asset impairments | 192 | 279 | |||||||||
| Adjusted EBITDA | 6,725 | 12,445 | |||||||||
| Less: adjusted EBITDA attributable to redeemable noncontrolling interest | (2,690) | (4,978) | |||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 4,035 | $ | 7,467 | |||||||
Six months ended June 30, 2025 compared with six months ended June 30, 2024
| Six months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 127,560 | $ | 131,673 | $ | (4,113) | (3 | %) | |||||||||||||||
| Gross profit | 36,611 | 39,970 | (3,359) | (8 | %) | ||||||||||||||||||
| Gross profit percentage | 28.7 | % | 30.4 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 13,949 | 15,421 | (1,472) | (10 | %) | ||||||||||||||||||
| Selling and distribution expenses | 9,107 | 8,584 | 523 | 6 | % | ||||||||||||||||||
| Amortization of purchased intangible assets | 9,526 | 10,555 | (1,029) | (10 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 517 | 279 | 238 | 85 | % | ||||||||||||||||||
| Operating income | 3,512 | 5,131 | (1,619) | (32 | %) | ||||||||||||||||||
| Adjusted EBITDA | 16,052 | 18,351 | (2,299) | (13 | %) | ||||||||||||||||||
| Less: adjusted EBITDA attributable to redeemable noncontrolling interest | (6,421) | (7,340) | (919) | (13 | %) | ||||||||||||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 9,631 | $ | 11,011 | (1,380) | (13 | %) | ||||||||||||||||
Net sales decreased $4,113 for the six months ended June 30, 2025 compared to the same period in 2024 due to lower sales volumes in longer-cycle high-end residential markets.
Gross profit percentage decreased to 28.7% for the six months ended June 30, 2025 primarily due to lower absorption of fixed manufacturing overhead costs as a result of the decrease in net sales mentioned above.
General and administrative expenses were lower by $1,472 for the six months ended June 30, 2025 compared to the same period in 2024. The year-over-year decrease is the result of lower compensation costs of $466 as a result of a reduction in headcount, lower expenses related to the Waterkeeper matter of $450, decreased business related travel of $360, and a nonrecurring legal settlement recorded in 2024 of $146.
Selling and distribution expenses increased $523 for the six months ended June 30, 2025 compared to the same period in 2024 due to higher incentive compensation costs.
Amortization of purchased intangible assets decreased $1,029 for the six months ended June 30, 2025 compared to the same period in 2024 as the customer relationship purchased intangible asset is amortized using an accelerated amortization method.
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Restructuring expenses and asset impairments of $517 for the six months ended June 30, 2025 related to employee severance associated with headcount reductions.
Operating income of $3,512 for the six months ended June 30, 2025 decreased compared to operating income of $5,131 in the same period in 2024 due primarily to the decline in gross profit.
Adjusted EBITDA decreased for the six months ended June 30, 2025 compared with the same period in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
| Six months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating income | $ | 3,512 | $ | 5,131 | |||||||
| Adjustments: | |||||||||||
| Depreciation | 2,022 | 1,763 | |||||||||
| Amortization of purchased intangible assets | 9,526 | 10,555 | |||||||||
| Stock-based compensation | 475 | 623 | |||||||||
| Restructuring expenses and asset impairments | 517 | 279 | |||||||||
| Adjusted EBITDA | 16,052 | 18,351 | |||||||||
| Less: adjusted EBITDA attributable to redeemable noncontrolling interest | (6,421) | (7,340) | |||||||||
| Adjusted EBITDA attributable to DMC Global Inc. | $ | 9,631 | $ | 11,011 | |||||||
DynaEnergetics
Three months ended June 30, 2025 compared with three months ended June 30, 2024
| Three months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 66,862 | $ | 76,210 | $ | (9,348) | (12 | %) | |||||||||||||||
| Gross profit | 13,959 | 15,133 | (1,174) | (8 | %) | ||||||||||||||||||
| Gross profit percentage | 20.9 | % | 19.9 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 3,028 | 3,011 | 17 | 1 | % | ||||||||||||||||||
| Selling and distribution expenses | 3,774 | 5,041 | (1,267) | (25 | %) | ||||||||||||||||||
| Amortization of purchased intangible assets | — | 29 | (29) | (100 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 746 | — | 746 | 100 | % | ||||||||||||||||||
| Operating income | 6,411 | 7,052 | (641) | (9 | %) | ||||||||||||||||||
| Adjusted EBITDA | $ | 8,979 | $ | 8,752 | $ | 227 | 3 | % | |||||||||||||||
Net sales decreased $9,348 for the three months ended June 30, 2025 compared to the same period in 2024 due to a decrease in volume of DS perforating systems attributable to lower well completions in North America, pricing decreases due to industry consolidation in the United States, and a reduction in international sales due to project timing.
Selling and distribution expenses were lower by $1,267 for the three months ended June 30, 2025 compared to the same period in 2024 primarily due to a reduction in bad debt expense of $602, decreased selling costs of $402 due to lower sales volume, and reduced consulting costs of $156.
Restructuring expenses and asset impairments of $746 for the three months ended June 30, 2025 include an asset impairment charge and related contract termination costs associated with exiting a lease totaling $605 and employee severance of $141 due to headcount reductions.
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Operating income of $6,411 for the three months ended June 30, 2025 decreased compared to operating income of $7,052 in the same period in 2024 due to the decline in net sales as well as the restructuring expenses and asset impairment charges incurred.
Adjusted EBITDA increased for the three months ended June 30, 2025 compared with the same period in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
| Three months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating income | $ | 6,411 | $ | 7,052 | |||||||
| Adjustments: | |||||||||||
| Depreciation | 1,822 | 1,671 | |||||||||
| Amortization of purchased intangible assets | — | 29 | |||||||||
| Restructuring expenses and asset impairments | 746 | — | |||||||||
| Adjusted EBITDA | $ | 8,979 | $ | 8,752 | |||||||
Six months ended June 30, 2025 compared with six months ended June 30, 2024
| Six months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 132,413 | $ | 154,332 | $ | (21,919) | (14 | %) | |||||||||||||||
| Gross profit | 26,770 | 32,104 | (5,334) | (17 | %) | ||||||||||||||||||
| Gross profit percentage | 20.2 | % | 20.8 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 5,775 | 5,903 | (128) | (2 | %) | ||||||||||||||||||
| Selling and distribution expenses | 8,250 | 10,263 | (2,013) | (20 | %) | ||||||||||||||||||
| Amortization of purchased intangible assets | — | 44 | (44) | (100 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 746 | — | 746 | 100 | % | ||||||||||||||||||
| Operating income | 11,999 | 15,894 | (3,895) | (25 | %) | ||||||||||||||||||
| Adjusted EBITDA | $ | 16,358 | $ | 19,291 | $ | (2,933) | (15 | %) | |||||||||||||||
Net sales decreased $21,919 for the six months ended June 30, 2025 compared to the same period in 2024 primarily due to a decrease in volume of DS perforating systems attributable to lower well completions in North America, pricing decreases due to industry consolidation in the United States, and a reduction in international sales due to project timing.
Selling and distribution expenses were lower by $2,013 for the six months ended June 30, 2025 compared to the same period in 2024 primarily due to a reduction in bad debt expense of $606, decreased selling costs of $568 due to lower sales volumes, reduced marketing consulting costs of $338, lower compensation costs of $278, and a decrease in business related travel of $64.
Restructuring expenses and asset impairments of $746 for the six months ended June 30, 2025 include an asset impairment charge and related contract termination costs associated with exiting a lease totaling $605 and employee severance of $141 due to headcount reductions.
Operating income decreased $3,895 for the six months ended June 30, 2025 compared to the same period in 2024 due to the decline in gross profit as well as the restructuring expenses and asset impairment charges incurred.
Adjusted EBITDA decreased for the six months ended June 30, 2025 compared to the same period in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
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| Six months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating income | $ | 11,999 | $ | 15,894 | |||||||
| Adjustments: | |||||||||||
| Depreciation | 3,613 | 3,353 | |||||||||
| Amortization of purchased intangible assets | — | 44 | |||||||||
| Restructuring expenses and asset impairments | 746 | — | |||||||||
| Adjusted EBITDA | $ | 16,358 | $ | 19,291 | |||||||
NobelClad
Three months ended June 30, 2025 compared with three months ended June 30, 2024
| Three months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 26,645 | $ | 25,221 | $ | 1,424 | 6 | % | |||||||||||||||
| Gross profit | 6,593 | 8,222 | (1,629) | (20 | %) | ||||||||||||||||||
| Gross profit percentage | 24.7 | % | 32.6 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 852 | 1,023 | (171) | (17 | %) | ||||||||||||||||||
| Selling and distribution expenses | 2,123 | 2,267 | (144) | (6 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 211 | — | 211 | 100 | % | ||||||||||||||||||
| Operating income | 3,407 | 4,932 | (1,525) | (31 | %) | ||||||||||||||||||
| Adjusted EBITDA | $ | 4,399 | $ | 5,722 | $ | (1,323) | (23 | %) | |||||||||||||||
Net sales increased $1,424 for the three months ended June 30, 2025 compared to the same period in 2024 due primarily to the timing of shipments out of backlog.
Gross profit percentage decreased to 24.7% for the three months ended June 30, 2025 due to a less favorable project and regional mix.
General and administrative expenses were lower by $171 for the three months ended June 30, 2025 compared to the same period in 2024 due primarily to a decrease in incentive compensation costs.
Selling and distribution expenses were lower by $144 for the three months ended June 30, 2025 compared to the same period in 2024 due primarily to a decrease in incentive compensation costs of $107 and a reduction in business related travel of $48.
Restructuring expenses and asset impairments of $211 for the three months ended June 30, 2025 relate to employee severance associated with headcount reductions.
Operating income decreased $1,525 for the three months ended June 30, 2025 compared to the same period in 2024 due primarily to the decline in gross profit.
Adjusted EBITDA decreased for the three months ended June 30, 2025 compared with the same period in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
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| Three months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating income | $ | 3,407 | $ | 4,932 | |||||||
| Adjustments: | |||||||||||
| Depreciation | 781 | 790 | |||||||||
| Restructuring expenses | 211 | — | |||||||||
| Adjusted EBITDA | $ | 4,399 | $ | 5,722 | |||||||
Six months ended June 30, 2025 compared with six months ended June 30, 2024
| Six months ended June 30, | |||||||||||||||||||||||
| 2025 | 2024 | $ change | % change | ||||||||||||||||||||
| Net sales | $ | 54,804 | $ | 52,043 | $ | 2,761 | 5 | % | |||||||||||||||
| Gross profit | 14,690 | 16,866 | (2,176) | (13 | %) | ||||||||||||||||||
| Gross profit percentage | 26.8 | % | 32.4 | % | |||||||||||||||||||
| COSTS AND EXPENSES: | |||||||||||||||||||||||
| General and administrative expenses | 2,043 | 2,096 | (53) | (3 | %) | ||||||||||||||||||
| Selling and distribution expenses | 4,407 | 4,738 | (331) | (7 | %) | ||||||||||||||||||
| Restructuring expenses and asset impairments | 211 | — | 211 | 100 | % | ||||||||||||||||||
| Operating income | 8,029 | 10,032 | (2,003) | (20 | %) | ||||||||||||||||||
| Adjusted EBITDA | $ | 9,815 | $ | 11,602 | $ | (1,787) | (15 | %) | |||||||||||||||
Net sales increased $2,761 for the six months ended June 30, 2025 compared to the same period in 2024 due primarily to the timing of shipments out of backlog.
Gross profit percentage decreased to 26.8% for the six months ended June 30, 2025 due to a less favorable project and regional mix.
Selling and distribution expenses decreased $331 for the six months ended June 30, 2025 compared to the same period in 2024 due to lower incentive compensation costs of $136, a decrease in business related travel of $110, and reduced outside services costs of $102.
Restructuring expenses and asset impairments of $211 for the six months ended June 30, 2025 relate to employee severance associated with headcount reductions.
Operating income decreased $2,003 for the six months ended June 30, 2025 compared to the same period in 2024 due primarily to lower gross profit.
Adjusted EBITDA decreased for the six months ended June 30, 2025 compared to the same period in 2024 due to the factors discussed above. See “Use of Non-GAAP Financial Measures” above for the explanation of the use of Adjusted EBITDA. The following is a reconciliation of the most directly comparable GAAP measure to Adjusted EBITDA.
| Six months ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating income | $ | 8,029 | $ | 10,032 | |||||||
| Adjustments: | |||||||||||
| Depreciation | 1,575 | 1,570 | |||||||||
| Restructuring expenses and asset impairments | 211 | — | |||||||||
| Adjusted EBITDA | $ | 9,815 | $ | 11,602 | |||||||
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Liquidity and Capital Resources
We have historically financed our operations from a combination of internally generated cash flow, revolving credit borrowings, and various long-term debt arrangements. Our net debt position was $46,248 at June 30, 2025 compared to $56,529 at December 31, 2024. The decrease was due primarily to improved financial performance which resulted in net credit facility repayments of $12,278.
We believe that cash and cash equivalents on hand, cash flow from operations, funds available under our current credit facilities and any future replacement thereof will be sufficient to fund the working capital, required minimum debt service payments, and other capital expenditure requirements of our current business operations for the foreseeable future. We may also execute capital markets transactions, including at-the-market offering programs, to raise additional funds if we believe market conditions are favorable, but there can be no assurance that any future capital will be available on acceptable terms or at all. Nevertheless, our ability to generate sufficient cash flows from operations will depend upon our success in executing our strategies. If we are unable to (i) realize sales from our backlog; (ii) secure new customer orders; (iii) continue selling products at profitable margins; and (iv) continue to implement cost-effective internal processes, our ability to meet cash requirements through operating activities could be impacted. Furthermore, any restriction on the availability of borrowings under our credit facilities could negatively affect our ability to meet future cash requirements. We will continue to monitor financial market conditions, including the related impact on credit availability and capital markets.
Debt facilities
On February 6, 2024, the Company and certain domestic subsidiaries entered into an amendment (the “First Amendment”) to its existing credit agreement with a syndicate of banks, led by KeyBank National Association (the “credit facility”). The First Amendment provides for certain changes to the credit facility, including an increase in the maximum commitment amount from $200,000 to $300,000. The credit facility allows for revolving loans of up to $200,000, a $50,000 term loan facility, and a $50,000 delayed draw term loan facility that can be accessed by the Company at its discretion until February 6, 2026 (the “Delayed Draw Term Loan Facility”). The $50,000 term loan facility is amortizable at $625 per quarter beginning on June 30, 2024 through March 31, 2026. Quarterly term loan amortization increases to $938 on June 30, 2026 through March 31, 2028, and increases to $1,250 from June 30, 2028 through December 31, 2028. A balloon payment for the outstanding term loan balance is due upon the credit facility maturity date of February 6, 2029. The credit facility retains a $100,000 accordion feature to increase the commitments under the revolving loan and/or by adding one or more term loans subject to approval by the applicable lenders. The credit facility is secured by certain assets of DMC including accounts receivable, inventory, and fixed assets, including Arcadia Products and its subsidiary, as well as guarantees and share pledges by DMC and its subsidiaries.
Borrowings under the $200,000 revolving loan limit and $50,000 term loan can be in the form of Adjusted Daily Simple Secured Overnight Financing Rate ("SOFR") loans or one month Adjusted Term SOFR loans. Additionally, U.S. dollar borrowings on the revolving loan can be in the form of Base Rate loans (Base Rate borrowings are based on the greater of the administrative agent’s Prime rate, an adjusted Federal Funds rate or an adjusted SOFR rate). SOFR loans currently bear interest at the applicable SOFR rate plus an applicable margin (varying from 2.25% to 3.25%). Base Rate loans currently bear interest at the defined Base Rate plus an applicable margin (varying from 1.25% to 2.25%).
The credit facility includes various covenants and restrictions, certain of which relate to the payment of dividends or other distributions to stockholders; redemption of capital stock; incurring additional indebtedness; mortgaging, pledging or disposition of major assets; and maintenance of specified ratios. As of June 30, 2025, we were in compliance with all financial covenants and other provisions of our debt agreements.
The leverage ratio is defined in the credit facility as the ratio of Consolidated Funded Indebtedness (as defined in the credit facility) on the last day of any trailing four quarter period to Consolidated EBITDA (as defined in the credit facility) for such period. The maximum leverage ratio currently permitted by our credit facility is 3.0 to 1.0; provided, however, that the Second Amendment (as defined below) provides for a temporary increase in the maximum leverage ratio under certain circumstances as described below. The maximum leverage ratio currently permitted by our credit facility is 3.0 to 1.0. The actual leverage ratio as of June 30, 2025, calculated in accordance with the Second Amendment, was 1.23 to 1.0.
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The debt service coverage ratio is defined in the credit facility as the ratio of Consolidated EBITDA less the sum of capital distributions paid in cash (other than those made with respect to preferred stock issued under the Operating Agreement), Consolidated Unfunded Capital Expenditures (as defined in the credit facility), and net cash income taxes divided by the sum of cash interest expense, any dividends on the preferred stock paid in cash, and scheduled principal payments on funded indebtedness. Under our credit facility, the minimum debt service coverage ratio permitted is 1.25 to 1.0. The actual debt service coverage ratio for the trailing twelve months ended June 30, 2025 was 3.83 to 1.0.
On June 10, 2025, the Company and certain domestic subsidiaries entered into an amendment to the credit facility (the “Second Amendment”). The Second Amendment provides for certain changes to the credit facility, including modifications to the Company’s financial covenants and applicable interest rates to accommodate the possible acquisition of the remaining 40% minority interest in Arcadia Products. Key provisions of the Second Amendment include a temporary increase in the Company’s maximum leverage ratio to 3.5x adjusted EBITDA over the trailing 12 months — up from 3.0x — should either the Put Option or the Call Option be exercised. This elevated leverage limit will apply for the first two quarters following payment of the purchase price of the Put Option or the Call Option, followed by a reduction to 3.25x in the third quarter, and a return to 3.0x thereafter. Additionally, proceeds under the Delayed Draw Term Loan Facility may now be held (to the extent drawn on such facility prior to expiration) in a restricted account after the expiration of such facility for purposes of paying the purchase price of the Put Option or the Call Option in the future.
We also maintain a line of credit with a German bank for certain European operations. This line of credit provides a borrowing capacity of €7,000 of which €637 was outstanding as of June 30, 2025.
Redeemable noncontrolling interest
The Operating Agreement for Arcadia Products contains a right for the Company to purchase the remaining interest in Arcadia Products from the minority interest holder on or after December 23, 2024 (“Call Option”). The minority interest holder of Arcadia Products also has the right to sell its remaining interest in Arcadia Products to the Company (“Put Option”). On December 3, 2024, the Company and minority interest holder entered into an amendment to the Operating Agreement whereby the minority interest holder agreed not to exercise the Put Option until on or after September 6, 2026. Both the Call Option and Put Option enable the respective holder to exercise their rights based upon a predefined calculation as included within the Operating Agreement, subject to a floor value also as defined within the Operating Agreement which is based primarily upon a contractually stated equity value.
As of June 30, 2025, the settlement amount of the redeemable noncontrolling interest was $187,080 and equals the floor value as defined within the Operating Agreement. Upon settlement, consideration paid will be net of the $24,902 promissory note outstanding due from the redeemable noncontrolling interest holder. Refer to Note 2 within Item 1 for further information related to the valuation of the redeemable noncontrolling interest and promissory note outstanding.
Other contractual obligations and commitments
Our debt balance, net of deferred debt issuance costs, decreased to $58,675 at June 30, 2025 from $70,818 at December 31, 2024 for the reasons discussed above. Our other contractual obligations and commitments have not materially changed since December 31, 2024.
Cash flows from operating activities
Net cash provided by operating activities of $19,734 for the six months ended June 30, 2025 increased compared to $15,783 in the same period last year driven primarily by lower working capital balances, which included lower inventory balances at Arcadia Products and NobelClad.
Cash flows from investing activities
Net cash used in investing activities for the six months ended June 30, 2025 of $718 was attributable to the acquisition, net of proceeds received, of property, plant and equipment of $4,885, partially offset by the settlement of a note receivable of $4,167.
Net cash provided by investing activities for the six months ended June 30, 2024 of $7,204 related to proceeds from sales and maturities of marketable securities of $12,619, partially offset by the acquisition of property, plant and equipment of $5,515.
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Cash flows from financing activities
Net cash flows used in financing activities for the six months ended June 30, 2025 of $19,746 included net credit facility repayments of $12,278, distributions to the redeemable noncontrolling interest holder of $6,255, payment of debt issuance costs of $650, and treasury stock purchases of $563.
Net cash flows used in financing activities for the six months ended June 30, 2024 of $39,727 primarily included net credit facility repayments of $31,500. Additional cash flows used in financing activities included distributions to the redeemable noncontrolling interest holder of $4,672, payment of debt issuance costs of $2,735 and treasury stock purchases of $952.
Payment of Dividends
Any determination to pay cash dividends is at the discretion of the Board of Directors. On April 23, 2020, DMC announced that its Board of Directors suspended the quarterly dividend indefinitely. Future dividends may be affected by, among other items, our views on potential future capital requirements, future business prospects, debt covenant compliance considerations, changes in income tax laws, and any other factors that our Board of Directors deems relevant.
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Critical Accounting Estimates
Preparation of financial statements in conformity with generally accepted accounting principles in the United States requires that management make estimates, judgments and assumptions that affect the amounts reported for revenues, expenses, assets, liabilities, and other related disclosures. Our critical accounting estimates have not changed from those reported in Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
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ITEM 3. Quantitative and Qualitative Disclosure about Market Risk
There were no material changes in market risk for changes in foreign currency exchange rates and interest rates from the information provided in Item 7A – Quantitative and Qualitative Disclosures About Market Risk in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.
ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer have evaluated the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, as of the end of the period covered by this report, and they have concluded that these controls and procedures are effective.
Changes in Internal Control over Financial Reporting
There were no changes that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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Part II - OTHER INFORMATION
Item 1. Legal Proceedings
Please see Note 12 to the Condensed Consolidated Financial Statements.
Item 1A. Risk Factors
There have been no material changes in the risk factors identified as being attendant to our business in our Annual Report on Form 10-K for the year ended December 31, 2024, except as provided below.
New or existing tariffs and other trade measures could adversely affect our results of operations, financial position and cash flows.
New or existing tariffs and other trade measures could adversely affect our results of operations, financial position and cash flows, either directly or indirectly through various adverse impacts on our significant customers. In 2018, the U.S. announced tariffs of 25 percent on steel and 10 percent on aluminum imported from countries where we typically source metals. These tariffs were met with retaliatory tariffs from certain countries and increased, broader tariffs were levied by the U.S. on targeted countries, including China. The tariffs impacted the cost of the importation of steel, which we utilize in our steel plate and steel pipe, key materials in our NobelClad and DynaEnergetics businesses. Though in many cases we have been able to source metals from domestic suppliers, some materials are only available from sources subject to tariffs. The cost of domestic steel and aluminum also increased, along with the price of delivery, and the availability of certain materials has been limited. These higher costs have increased the price of our products to our customers and, in some instances, affected our ability to be competitive. For our NobelClad business, this has impacted our ability to compete on international projects and negatively impacted U.S. fabricators, which are the primary consumers of NobelClad products.
In 2025, the U.S. has announced and/or implemented significant new tariffs on imports from a wide range of countries, which has prompted retaliatory tariffs by a number of countries and a cycle of retaliatory tariffs by both the U.S. and other countries. The tariff policy environment has been and is expected to continue to be dynamic, and we cannot predict what additional actions may ultimately be taken by the U.S. or other governments with respect to tariffs or trade relations. We may be required to take further responsive steps, as the prolonged duration of tariffs, including retaliatory tariffs, the imposition of additional tariffs and the risk of potential broader global trade conflicts could have a material adverse effect on our business, financial condition or results of operations if we are not able to pass through cost increases to our customers.
Changes in immigration laws or enforcement programs could adversely affect our business.
Certain states in which we operate are considering or have already adopted new immigration laws and/or enforcement programs, and the federal government from time to time considers and implements changes to federal immigration laws, regulations, and/or enforcement programs. Recently, Immigration and Customs Enforcement (ICE) has significantly increased its enforcement of immigration laws. Our employment eligibility verification process does not guarantee that we will properly identify all applicants who are ineligible for employment. Unauthorized workers are subject to deportation and may subject us to fines or penalties, and if any of our workers are found to be unauthorized, we could experience adverse publicity that negatively impacts our brand and may make it more difficult to hire and retain qualified employees. Additionally, increased enforcement of immigration laws may reduce the overall labor pool and as a byproduct, increase the cost of qualified employees. These factors could have a material adverse effect on our business, financial condition, and results of operations.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
In connection with the vesting of Company restricted common stock under our equity incentive plans or distributions of shares of common stock pursuant to our Amended and Restated Non-Qualified Deferred Compensation Plan (“deferred compensation plan”) during the second quarter of 2025, we retained shares of common stock in satisfaction of withholding tax obligations. We also retained shares of common stock as the result of participants’ diversification of equity awards held in the deferred compensation plan into other investment options. These shares are held as treasury shares by the Company.
Total number of shares purchased (1) (2) | Average price paid per share | |||||||||||||
| April 1 to April 30, 2025 | — | $ | — | |||||||||||
| May 1 to May 31, 2025 | 12,174 | $ | 6.49 | |||||||||||
| June 1 to June 30, 2025 | 482 | $ | 8.06 | |||||||||||
| Total | 12,656 | $ | 6.55 | |||||||||||
(1) Share purchases during the period were to offset tax withholding obligations that occurred upon (i) vesting of restricted common stock under the terms of the 2016 Omnibus Incentive Plan and (ii) distributions of shares of common stock pursuant to deferred compensation obligations.
(2) As of June 30, 2025, the maximum number of shares that could be purchased would not exceed the employees’ portion of taxes to be withheld on unvested shares (1,068,148) and potential purchases upon participant elections to diversify equity awards held in the deferred compensation plan (8,699) into other investment options available to participants in the Plan.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Our Coolspring property is subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the quarter ended June 30, 2025, we had no such specified health and safety violations, orders or citations, related assessments or legal actions, mining-related fatalities, or similar events in relation to our United States operations requiring disclosure pursuant to Section 1503(a) of the Dodd-Frank Act.
Item 5. Other Information
During the quarter ended June 30, 2025, no director or officer (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted terminated
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Item 6. Exhibits
4.1 Amendment No. 1 to Stockholder Protection Rights Agreement, dated as of May 30, 2025, between DMC Global Inc. and Computershare Trust Company, N.A., as Rights Agent (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed on June 3, 2025).
10.1 DMC Global Inc. 2025 Omnibus Incentive Plan (incorporated by reference to Exhibit 99.1 to the Company's Registration Statement on Form S-8 (File No. 333-287265) filed on May 14, 2025).
10.2 Second Amendment to the Credit Agreement, dated June 10, 2025, by and between DMC Global Inc., certain of its domestic subsidiaries as borrowers, the lenders party thereto and KeyBank National Association, as administrative agent, a swing line lender and an issuing lender (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 11, 2025).
10.3 Form of Executive Officer Restricted Stock Award Agreement under the 2025 Omnibus Incentive Plan.
10.4 Form of Director Restricted Stock Award Agreement under the 2025 Omnibus Incentive Plan.
10.5 Form of Executive Officer Restricted Stock Unit Award Agreement under the 2025 Omnibus Incentive Plan.
10.6 Form of Executive Officer Performance Unit Agreement under the 2025 Omnibus Incentive Plan.
10.7 President and Chief Executive Officer Letter Agreement between James O’Leary and DMC Global Inc., dated as of June 20, 2025, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 23, 2025.
10.8 Restricted Stock Unit Award Agreement (Chief Executive Officer Form), (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 23, 2025).
10.9 Performance Share Unit Award Agreement (Chief Executive Officer Form), (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on June 23, 2025).
31.1 Certification of the President and Chief Executive Officer pursuant to 17 CFR 240.13a-14(a) or 17 CFR 240.15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification of the Chief Financial Officer pursuant to 17 CFR 240.13a-14(a) or 17 CFR 240.15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 Certification of the President and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101 The following materials from the Quarterly Report on Form 10-Q of DMC Global Inc. for the quarter ended June 30, 2025, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Income, (iv) the Condensed Consolidated Statement of Stockholders’ Equity and Redeemable Noncontrolling Interest, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.*
* Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| DMC Global Inc. | |||||||||||
| (Registrant) | |||||||||||
| Date: | August 5, 2025 | /s/ Eric V. Walter | |||||||||
| Eric V. Walter, Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) | |||||||||||
| Date: | August 5, 2025 | /s/ Brett Seger | |||||||||
| Brett Seger, Chief Accounting Officer (Duly Authorized Officer and Principal Accounting Officer) | |||||||||||
47
FAQ
Why did HOTH file a new Form S-8 on 5-Aug-2025?
To register 2,000,000 additional shares for issuance under its Amended & Restated 2022 Omnibus Equity Incentive Plan.
How many total shares are now reserved under HOTH's 2022 Equity Plan?
The share reserve increased to 3,091,317 following shareholder approval.
Does the filing immediately increase HOTH's shares outstanding?
No. Shares are only issued when equity awards are granted and subsequently exercised or vest.
What filer status does HOTH report in this S-8?
HOTH identifies as a non-accelerated filer and a smaller reporting company.
Which law firm provided the opinion for this registration?
Sheppard, Mullin, Richter & Hampton LLP issued the legal opinion (Exhibit 5.1).
Were prior S-8 registrations incorporated?
Yes, prior filings 333-265984, 333-274125, 333-281610 are incorporated by reference.
Dmc Global Inc
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