10-K - Advanced Flower Capital Inc. | StockGist

AI Analysis

AI-generated analysis. Always verify with the original filing.

Advanced Flower Capital Inc. reported a net loss of $20.7 million for FY 2025, a significant decline from the net income of $16.8 million in FY 2024. The loss was driven by a substantial $22.6 million provision for current expected credit losses and $7.9 million in unrealized losses on loans at fair value, which overwhelmed net interest income of $24.6 million. Despite the net loss, the company generated $11.2 million in net cash from operating activities. Key challenges included placing several loans on nonaccrual status and ongoing litigation related to the Subsidiary of Private Company G credit facility. The company completed a strategic transition to a Business Development Company (BDC) effective January 1, 2026, which will subject it to a new regulatory framework and is expected to broaden its investment focus beyond cannabis industry loans.

Key Takeaways

1Reported a net loss of $20.7M, a $37.5M negative swing from prior year net income of $16.8M.

2Recorded a $22.6M provision for current expected credit losses, significantly impacting profitability.

3Generated $11.2M in net cash from operating activities despite the reported net loss.

4Held $46.1M in current expected credit loss reserve against $253.6M of loans at carrying value.

5Elected to be regulated as a Business Development Company (BDC) effective January 1, 2026.

Key Financial Metrics

EPS

-$1.00

Not provided for prior year

Net Income

-$20.7M

-223.2%

free cash flow

$11.2M