10q10k10q10k.net

What changed in LIVE VENTURES Inc's 10-K — 2022 vs 2023

vs

Paragraph-level year-over-year comparison of LIVE VENTURES Inc's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+274 added−246 removedSource: 10-K (2023-12-22) vs 10-K (2022-12-16)

Top changes in LIVE VENTURES Inc's 2023 10-K

274 paragraphs added · 246 removed · 185 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

55 edited+33 added−11 removed24 unchanged
Biggest changeInformation contained on our website is not incorporated into this Annual Report on Form 10-K. Products and Services Retail Segment Vintage Stock Vintage Stock is an award-winning, specialty entertainment retailer with 68 storefronts across the U.S. Vintage Stock enjoys a wide customer base comprised of electronic entertainment enthusiasts, avid collectors, female gamers, children, seniors and more.
Biggest changeAny information contained on our website or any other websites referenced in this Form 10-K is not incorporated by reference into this Form 10-K and should not be considered a part of this Form 10-K. Products and Services Retail-Entertainment Segment Vintage Stock, Inc. Vintage Stock, Inc. ("Vintage Stock") is an award-winning, specialty entertainment retailer with 70 storefronts across the U.S.
Vintage Stock’s industry is intensely competitive and subject to rapid changes in consumer preferences and frequent product introductions. Competition is based on the ability to adopt new technology, aggressive franchising, the establishment of brand names and quality of collections.
Competition Vintage Stock’s industry is intensely competitive and subject to rapid changes in consumer preferences and frequent product introductions. Competition is based on the ability to adopt new technology, aggressive franchising, the establishment of brand names and quality of collections.
(“Marquis”) is a leading carpet manufacturer and a manufacturer of innovative yarn products, as well as a reseller of hard surface flooring products. Over the last decade, Marquis has been an innovator and leader in the value-oriented polyester carpet sector. We focus on the residential, niche commercial, and hospitality end-markets and serve thousands of customers.
(“Marquis”) is a leading carpet manufacturer and a manufacturer of innovative yarn products, as well as a reseller of hard surface flooring products. Over the last decade, Marquis has been an innovator and leader in the value-oriented polyester carpet sector. Marquis focus on the residential, niche commercial, and hospitality end-markets and serve thousands of customers.
Notwithstanding the use of this open-source code, we do not believe our usage requires public disclosure of our own source code nor do we believe the use of open-source code will have a material impact on our business. 9 We register some of our product names, slogans and logos in the United States.
Notwithstanding the use of this open-source code, we do not believe our usage requires public disclosure of our own source code nor do we believe the use of open-source code will have a material impact on our business. We register some of our product names, slogans and logos in the United States.
All products are printed on high performance nylon and are soil and stain resistant. 4 Hard Surfaces The Marquis and Gulistan Floorcoverings Surface product lineup includes products designed for both residential and commercial end uses.
All products are printed on high performance nylon and are soil and stain resistant. Hard Surfaces The Marquis and Gulistan Floorcoverings Surface product lineup includes products designed for both residential and commercial end uses.
The largest industry served by Kinetic is the Tissue Industry with well in excess of 400 customers. Kinetic also serves 200 steel mills or steel service centers across the US and Canada.
The largest industry served by Kinetic is the tissue industry with in excess of 400 customers. Kinetic also serves 200 steel mills or steel service centers across the US and Canada.
Kinetic manufactures and sells steel perforation blades and tungsten carbine anvils for paper or tissue-converting machinery; fly knives for napkin folding machinery; cut-off blades for diaper machinery, wrapper knives for tissue, film, and foil wrapping machines, chopper blades used in tissue, towel, and printing machinery, and tube and core cutter blades, core saws, slitters, slitter anvils, sheeted knives, pulp cutters, guillotine blades, roll splitter blades to the tissue/paper industry.
Kinetic manufactures and sells steel perforation blades and tungsten carbide anvils for paper or tissue-converting machinery, fly knives for napkin folding machinery, cut-off blades for diaper machinery, wrapper knives for tissue, film, and foil wrapping machines, chopper blades used in tissue, towel, and printing machinery, and tube and core cutter blades, core saws, slitters, slitter anvils, sheeted knives, pulp cutters, guillotine blades, roll splitter blades to the tissue/paper industry.
With over 5,000 distinct size grade combinations in stock every day, Precision Marshall arms tool steel distributors with deep inventory availability and same day shipment to their place of business or often ships direct to their customer saving time and handling. The Kinetic Co., Inc. On June 28, 2022, Precision Marshall acquired The Kinetic Co., Inc. (“Kinetic”).
With over 5,000 distinct size grade combinations in stock every day, Precision Marshall arms tool steel distributors with deep inventory availability and same day shipment to their place of business or often ships direct to their customer saving time and handling. The Kinetic Co., Inc. In June 2022, Precision Marshall acquired The Kinetic Co., Inc. (“Kinetic”).
The Kinetic sales team consists of direct salespeople comprised of both employee Territory Sales Managers and outside sales representatives. This team of salespeople calls on customers and prospects located throughout the US. Kinetic also has a seasoned four-person inside sales team which is specialized in the market, and offers tremendous technological knowledge and insight to its customers.
The Kinetic sales team consists of direct salespeople comprised of both employee Territory Sales Managers and outside sales representatives. This team of salespeople calls on customers and prospects located throughout the US. Kinetic also has a seasoned six-person inside sales team which is specialized in the market, and offers tremendous technological knowledge and insight to its customers.
Since commencing operations in 1995, Marquis has built a strong reputation for outstanding value, styling, and customer service. Our innovation has yielded products and technologies that differentiate our brands in the flooring marketplace. Marquis’ state-of-the-art operations enable high quality products, unique customization, and exceptionally short lead-times.
Since commencing operations in 1995, Marquis has built a strong reputation for outstanding value, styling, and customer service. Our innovation has yielded products and technologies that differentiate its brands in the flooring marketplace. Marquis’ state-of-the-art operations enable high quality products, unique customization, and short lead-times.
Marquis is a fully integrated carpet mill, and, as a result, is able to produce carpet at the lowest cost possible for its target price point. Marquis is a one-stop shop for soft and hard surface products, allowing its customers to save time and receive exceptional service.
Marquis is a fully integrated carpet mill, and, as a result, is able to produce carpet at the lowest cost possible for its target price point. Marquis is a one-stop shop for soft and hard surface products, allowing its customers to save time and receive quality service.
Kinetic has a world class reputation and is a respected brand in the industries it serves. Kinetic differentiates itself from its competition being a one-stop-shop for grinding, machining, and heat treating. Much of the work done by Kinetic is very specialized and its customers demand high quality and reliable products to keep production lines running.
Kinetic has a strong reputation and is a respected brand in the industries it serves. Kinetic differentiates itself from its competition by being a one-stop-shop for grinding, machining, and heat treating. Much of the work done by Kinetic is specialized and its customers demand high quality and reliable products to keep production lines running.
Live Ventures was founded in 1968 and later refocused under our CEO and strategic investor, Jon Isaac. The Company’s current portfolio of diversified operating subsidiaries includes companies in the textile, flooring, tools, steel, entertainment, and financial services industries. Live's operating businesses are managed on a decentralized basis.
Live Ventures was founded in 1968 and later refocused under our Chief Executive Officer and strategic investor, Jon Isaac. The Company’s current portfolio of diversified operating subsidiaries includes companies in the textile, flooring, tools, steel, entertainment, and financial services industries. Live's operating businesses are managed on a decentralized basis.
Vintage Stock also uses guerrilla marketing by partnering and setting up booths with movie theaters for blockbuster releases, various trade fairs, and school donations. Our Market Vintage Stock . According to the Entertainment Software Association (“ESA”), today’s video games provide rich, engaging entertainment for players across all platforms.
Vintage 3 Table of Contents Stock also uses guerrilla marketing by partnering and setting up booths with movie theaters for blockbuster releases, various trade fairs, and school donations. Market According to the Entertainment Software Association (the “ESA”), today’s video games provide rich, engaging entertainment for players across all platforms.
The Kinetic Co., Inc. Kinetic primarily serves three industries or market segments, which include the tissue industry, steel industry, and contract work. The majority of Kinetic's revenues are derived from replacement knives or products specifically designed and manufactured to replace wear parts on cutting equipment.
The tool steel market is a niche market within the steel industry. The Kinetic Co., Inc. Kinetic primarily serves three industries or market segments, which include the tissue industry, steel industry, and contract work. The majority of Kinetic's revenues are derived from replacement knives or products specifically designed and manufactured to replace wear parts on cutting equipment.
Vintage Stock markets its stores primarily via social media apps, SMS text messages, including, but not limited to, individual store and corporate Facebook and Twitter accounts. We have an approximately 900,000-customer list for distribution of our digital new release catalog and promotion of online and brick and mortar sales and coupons.
Marketing Vintage Stock markets its stores primarily via social media apps, SMS text messages, including, but not limited to, individual store and corporate Facebook and Twitter accounts. It has an approximately 900,000-customer list for distribution of its digital new release catalog and promotion of online and brick and mortar sales and coupons.
We compete with mass merchants and regional chains; computer product and consumer electronics stores; other video game and PC software specialty stores; toy retail chains; direct sales by software publishers; and online retailers and game rental companies. However, we have established a presence in areas where we believe that we can take a greater portion of market share.
It competes with mass merchants and regional chains; computer product and consumer electronics stores; other video game and PC software specialty stores; toy retail chains; direct sales by software publishers; and online retailers and game rental companies. However, it has established a presence in areas where it believe that it can take a greater portion of market share.
Industry and Market Marquis is an integrated carpet manufacturer and distributor of carpet and hard-surface flooring within a fragmented industry composed of a wide variety of companies from small privately held firms to large multinationals. In 2021, the U.S. floor covering industry had an estimated $33.7 billion in sales.
Industry and Market Marquis is an integrated carpet manufacturer and distributor of carpet and hard-surface flooring within a fragmented industry composed of a wide variety of companies from small privately held firms to large multinationals. In 2022, the U.S. floor covering industry had an estimated $37.6 billion in sales.
Hard Surfaces Hard flooring surfaces, such as ceramic, luxury vinyl tile, hardwood, stone, and laminate, had shipments of approximately $20.7 billion in 2021. As with carpet and rugs, the market is split between residential and commercial and replacement and new construction, with residential replacement being the largest segment of the market.
Hard Surfaces Hard flooring surfaces, such as ceramic, luxury vinyl tile, hardwood, stone, and laminate, had shipments of approximately $24.9 billion in 2022. As with carpet and rugs, the market is split between residential and commercial and replacement and new construction, with residential replacement being the largest segment of the market.
Kinetic is a highly recognizable and regarded brand name in the production of industrial knives and hardened wear products for the tissue and metals industries and is known as a one-stop shop for in-house grinding, machining, and heat-treating. Kinetic was founded by the Masters family in 1948 and is headquartered in Greendale, Wisconsin.
Kinetic is a highly recognizable and regarded brand name in the production of industrial knives and hardened wear products for the tissue and metals industries and is known as a one-stop shop for in-house grinding, machining, and heat-treating. Kinetic is headquartered in Greendale, Wisconsin.
The following is a breakdown of each brand and the specialized products sold: Brand Products and/or Services Artisans Hospitality Carpets to commercial and hospitality markets Astro Carpet Mills Specialty printed carpet to the entertainment industry and artificial turf Better Backers Finishing Commission carpet coating and finishing services Constellation Industries Contract commission printing Gulistan Floorcoverings All forms of floor covering to residential dealers featuring patterned and branded carpets Lonesome Oak Residential carpet to dealers featuring PET and Nylon specials Lonesome Oak Manufactured Housing All forms of floor covering to manufactured housing factories Marquis Industries All forms of floor covering to dealers and home centers Omega Pattern Works Specialty printed carpet to the entertainment industry (bowling alleys, fun centers, movie theaters, and casinos) Products Carpets & Rugs Marquis produces innovative residential and commercial floorcovering products.
The following is a breakdown of each brand and the specialized products sold: Brands Products and/or Services Artisans Hospitality Carpets to commercial and hospitality markets Astro Carpet Mills Specialty printed carpet to the entertainment industry and artificial turf Better Backers Finishing Commission carpet coating and finishing services Constellation Industries Contract commission printing Gulistan Floorcoverings All forms of floor covering to residential dealers featuring patterned and branded carpets Kraus Carpet tile to the commercial and main street markets and vinyl and rigid core flooring Lonesome Oak Residential carpet to dealers featuring PET and Nylon specials Lonesome Oak Manufactured Housing All forms of floor covering to manufactured housing factories Marquis Industries All forms of floor covering to dealers and home centers Naturally Aged Flooring High End Hardwood Flooring Omega Pattern Works Specialty printed carpet to the entertainment industry (bowling alleys, fun centers, movie theaters, and casinos) Products Carpets & Rugs Marquis produces innovative residential and commercial floorcovering products.
Today, two in three Americans play video games at least weekly, and nine in 10 players say they spend as much or more time playing now as they did at the pandemic’s peak. According to the ESA, the following statistics show the benefits of video games. The average video game player is 33 years old.
Today, two in three Americans play video games at least weekly, and nine in 10 players say they spend as much or more time playing now as they did at the pandemic’s peak. According to the Video Game Industry Report, the average video game player is 33 years old.
We expect to receive adequate supply to service new and existing customers. Customers Marquis sells products to flooring dealers, home centers, other flooring manufacturers and directly to commercial end-users. The majority of sales are to a network of flooring dealers across several different end markets, geographies, and product lines.
Customers Marquis sells products to flooring dealers, home centers, other flooring manufacturers and directly to commercial end-users. The majority of sales are to a network of flooring dealers across several different end markets, geographies, and product lines.
Precision Marshall has led the industry with exemplary availability and value-added processing that saves distributors time and processing costs. Founded in 1948, Precision Marshall “The Deluxe Company” has built a reputation of high integrity, speed of service and doing things the “Deluxe Way”.
For over 75 years, Precision Marshall has served steel distributors through quick and accurate service. Precision Marshall has led the industry with availability and value-added processing that saves distributors time and processing costs. Founded in 1948, Precision Marshall “The Deluxe Company” has built a reputation of high integrity, speed of service and doing things the “Deluxe Way”.
Precision Marshall provides steel service centers and distributors with immediate availability, allowing customers to have access to all sizes and grades without having to make an inventory investment. Precision Marshall only sells to distributors and steel service centers and has a strict policy of not selling to end-users. The tool steel market is a niche market within the steel industry.
Precision Marshall is a fully-integrated manufacturer of the above-mentioned steel products. Precision Marshall provides steel service centers and distributors with immediate availability, allowing customers to have access to all sizes and grades without having to make an inventory investment. Precision Marshall only sells to distributors and steel service centers and has a strict policy of not selling to end-users.
On our website, anyone can obtain, free of charge, this year's and prior year's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all of our other filings with the SEC. Recent press releases are also available on our website. Live’s website also contains important information regarding our corporate governance practices.
On our website, anyone can obtain, free of charge, this year's and prior year's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all of our other filings with the SEC. Recent press releases and investor presentations are also available on our website.
Drill Rod Eight grades with over 800 diameter/grade combinations of polished round bars in lengths of 36, 72, and 144 inches are available for immediate shipment from the national distribution center. The Kinetic Co., Inc.
Drill Rod Nine grades with approximately 1,000 diameter/grade combinations of polished round bars in lengths of 36, 72, and 144 inches are available for immediate shipment from the national distribution center. 8 Table of Contents The Kinetic Co., Inc.
The national distribution center is strategically located and can service the tooling hub of the Midwest. The Company manufactures all products and holds the inventory for the Deluxe Alloy and Deluxe Tool Steel plate products at its corporate headquarters in Washington, Pennsylvania. Precision Marshall has more than 18 people selling, marketing, and distributing its products. The Kinetic Co., Inc.
Sales, Marketing, and Distribution Precision Industries, Inc. Precision Marshall has two distribution centers that hosts its products. The national distribution center is strategically located and can service the tooling hub of the Midwest. The Company manufactures all products and holds the inventory for the Deluxe Alloy and Deluxe Tool Steel plate products at its corporate headquarters in Washington, Pennsylvania.
A quality workforce of approximately 54 employees was transitioned as part of the purchase, and that workforce is critical to maintaining the high level of quality. At September 30, 2022, Marquis operated its business through nine brands, each specializing in a distinct area of the business. Marquis’ flooring source division is the largest of all of the brands.
A quality workforce of approximately 54 employees was transitioned as part of the purchase, and that workforce is critical to maintaining the high level of quality. 5 Table of Contents At September 30, 2023, Marquis operated its business through ten brands, each specializing in a distinct area of the business.
Corporate and Other Segment Our corporate and other segment consists of certain corporate general and administrative costs, Salomon Whitney LLC (“SW Financial”), a variable interest entity (“VIE”), and operations of certain legacy product and service offerings for which we are no longer accepting new customers.
Corporate and Other Segment Our corporate and other segment consists of certain corporate general and administrative costs and operations of certain legacy product and service offerings for which we are no longer accepting new customers.
Vintage Stock offers a large selection of entertainment products including new and pre-owned movies, video games, and music products, as well as additional products, such as books, comics, toys and collectibles—all available in a single location.
Vintage Stock enjoys a wide customer base comprised of electronic entertainment enthusiasts, avid collectors, gamers, children, seniors and more. Vintage Stock offers a large selection of entertainment products including new and pre-owned movies, video games, and music products, as well as additional products, such as books, comics, toys and collectibles—all available in a single location.
Marquis offers 65 running line styles under three brands, Marquis, Gulistan and Lonesome Oak, each of which provide outstanding quality and value. It also offers special value in polyester and nylon styles. Marquis products feature high twist yarns produced with ultra-soft fibers and are designed to perform well in high traffic areas.
Marquis offers over 200 running line styles under four brands, Marquis, Gulistan and Lonesome Oak, and Kraus, each of which provide quality and value. Marquis products feature high twist yarns produced with ultra-soft fibers, or high-performance commercial fibers, and are designed to perform well in high traffic areas.
The industry has two primary sub-markets, replacement and new construction, with the replacement market making up the larger portion of the sub-markets. Approximately 56.7% of industry shipments are made in response to residential replacement demand. Residential products consist of broadloom carpets and rugs in a broad range of styles, colors and textures.
The carpet and rugs industry has two primary markets, residential and commercial, with the residential market making up the largest portion of the industry. The industry has two primary sub-markets, replacement and new construction, with the replacement market making up the larger portion of the sub-markets. Approximately 56.7% of industry shipments are made in response to residential replacement demand.
The contract business at Kinetic is a catchall segment consisting of a wide range of products and services ranging from plate grinding or milling for customers to countless specialized needs companies which require precision machining, grinding and heat treat applications. Competition Precision Industries, Inc.
The contract business at Kinetic is a catchall segment consisting of a wide range of products and services ranging from plate grinding or milling for customers to countless specialized needs for companies that require precision machining, grinding and heat treat applications. Precision Metal Works, Inc. Brackets and Structural Stampings Appliance manufacturers are the largest customers and longest-lasting relationships for PMW.
Kinetic has a customer base consisting of approximately 800 customers, and is very diversified, broad and stable. Ninety-five percent of Kinetic's revenues are from sales to companies located in the U.S. 7 Our Market Precision Industries, Inc.
Kinetic has a customer base consisting of approximately 800 customers that is diversified, broad and stable. Ninety-five percent of Kinetic's revenues are from sales to companies located in the U.S. Precision Metal Works, Inc. PMW is part of the metal stamping industry that supplies complex components to the appliance and transportation industries.
Marquis manufactures high quality products and offer unique customization with exceptionally short lead-times. Marquis’ investment in new yarn extrusion capacity will allow expansion into new markets while reducing production costs. The new equipment allows Marquis to reduce production costs and increase margins. Marketing Marquis has a team of 46 full-time salespeople, who deepen customer relationships throughout its markets.
Marquis manufactures high quality products and offers unique customization with short lead-times. Marquis’ investment in new yarn extrusion capacity will allow expansion into new markets while reducing production costs. The new equipment allows Marquis to reduce production costs and increase margins.
Deluxe Tool Steel Plate The De-Carb Free Tool Steel Plate Market in North America supplies pre-heat-treated plates that are commonly used to make tools, dies and industrial knives used in a variety of industries with a dominance in the automotive industry.
Deluxe Tool Steel Plate The De-Carb Free Tool Steel Plate Market in North America supplies pre-heat-treated plates that are commonly used to make tools, dies and industrial knives used in a variety of industries with a dominance in the automotive industry. 9 Table of Contents Precision Ground Flat Stock The Precision Ground Flat Stock market provides refined tool steel, alloy and stainless flat bars that are used to make tools, dies, holder blocks and industrial knives across all North American Manufacturing categories.
Kinetic has established long-term relationships with all of its foreign and domestic tool steel suppliers. Long lead times have become an added challenge in recent years, however, Kinetic does significant advanced planning to assure the timely receipt and stocking of inventory levels. Sales, Marketing, and Distribution Precision Industries, Inc. Precision Marshall has two distribution centers that hosts its products.
Kinetic has established long-term relationships with all of its foreign and domestic tool steel suppliers. Long lead times have become an added challenge in recent years, however, Kinetic does significant advanced planning to assure the timely receipt and stocking of inventory levels. Precision Metal Works, Inc. Metal suppliers are generally contracted by our customers as part of larger purchase.
Commercial products consist primarily of broadloom carpet and modular carpet tile for a variety of institutional applications including office buildings, restaurant chains, schools and other commercial establishments. The carpet industry also manufactures carpet for the automotive, recreational vehicle, small boat and other industries. The Carpet and Rug Institute (the “CRI”) is the national trade association representing carpet and rug manufacturers.
Residential products consist of broadloom carpets and rugs in a broad range of styles, colors and textures. Commercial products consist primarily of broadloom carpet and modular carpet tile for a variety of institutional applications including office buildings, restaurant chains, schools and other commercial establishments. The carpet industry also manufactures carpet for the automotive, recreational vehicle, small boat and other industries.
We also compete with sellers of pre-owned and value video game products. Additionally, we compete with other forms of entertainment activities, including casual and mobile games, movies, television, theater, sporting events and family entertainment centers. 3 Flooring Manufacturing Segment Marquis Industries, Inc. Marquis Industries, Inc.
It also competes with sellers of pre-owned and value video game products. Additionally, it competes with other forms of entertainment activities, including casual and mobile games, movies, television, theater, sporting events and family entertainment centers. Retail-Flooring Segment Flooring Liquidators, Inc. The Company acquired Flooring Liquidators, Inc. (“Flooring Liquidators“) in January 2023.
A number of companies compete with Kinetic in the tissue/paper industry. The primary competitors are International Knife and Saw (“IKS”), located in South Carolina, Everwear, located in Missouri, and TKM, located in Germany. Kinetic produces a wider range of products than its competitors in the tissue/paper industry.
The primary competitors are International Knife and Saw (“IKS”), located in South Carolina, Everwear, located in Missouri, and TKM, located in Germany. Kinetic produces a wider range of products than its competitors in the tissue/paper industry. Competitors in the steel industry include IKS, American Shear Knife (“ASKO”), which manufactures in Mexico, or overseas, and Modern Machine located in Indiana.
Kinetic distributes all of its products from its Greendale, Wisconsin headquarters facility. Kinetic will carry some finished goods inventory, which is located either in Greendale, or at a warehouse facility in Milwaukee, Wisconsin. The majority of Kinetic products are manufactured in Greendale and shipped upon completion.
Precision Marshall has more than 18 people selling, marketing, and distributing its products. The Kinetic Co., Inc. Kinetic distributes all of its products from its Greendale, Wisconsin headquarters facility. Kinetic carries some finished goods inventory from its headquarters or at a warehouse facility in Milwaukee, Wisconsin. The majority of Kinetic products are manufactured in Greendale and shipped upon completion.
The tool and die steel market in North America is highly competitive and requires a high investment in inventory, manufacturing, and service infrastructure. There are several long-standing competitors in each product segment. Precision Industries competes through speed of service by having high inventory availability and an easy to purchase customer experience. The Kinetic Co., Inc.
There are several long-standing competitors in each product segment. Precision Marshall competes through speed of service by having high inventory availability and an easy to purchase customer experience. The Kinetic Co., Inc. A number of companies compete with Kinetic in the tissue/paper industry.
Marquis’s specialty print brands offer printed patterned carpet designed for commercial applications. Patterns are tailored to a variety of end uses, such as fun centers, movies theatres, hotels, casinos and corporate.
Marquis Hard Surface currently offers engineered hardwood, dry-back, loose lay vinyl plank, click-and-lock rigid core plank and tile, and rolls of sheet vinyl flooring. Marquis’s specialty print brands offer printed patterned carpet designed for commercial applications. Patterns are tailored to a variety of end uses, such as fun centers, movies theatres, hotels, casinos and corporate.
Intellectual Property Our success will depend significantly on our ability to develop and maintain the proprietary aspects of our technology and operate without infringing upon the intellectual property rights of third parties. We currently rely primarily on a combination of copyright, trade secret and trademark laws, confidentiality procedures, contractual provisions, and similar measures to protect our intellectual property.
Intellectual Property Our success will depend significantly on our ability to develop and maintain the proprietary aspects of our technology and operate without infringing upon the intellectual property rights of third parties.
These de-carb-free heat treated, and annealed plates are square and within a .020 tolerance on the surface allowing distributors to save cutting time, kerf loss and machining time.
Deluxe Alloy Plate Precision Marshall provides three alloy plate products in sizes from 1/4 inch to 8 inches in thickness. These decarb-free heat treated, and annealed plates are square and within a .020 tolerance on the surface allowing distributors to save cutting time, kerf loss and machining time.
Floor covering sales are influenced by the homeowner remodeling and residential builder markets, existing home sales and housing starts, average house size and home ownership. In addition, the level of sales in the floor covering industry is influenced by consumer confidence, spending for durable goods, the condition of residential and commercial construction, and overall strength of the economy.
Floor covering sales are influenced by the homeowner remodeling and residential builder markets, existing home sales and housing starts, average house size and home ownership.
Steel Manufacturing Segment Precision Industries, Inc. The Company acquired Precision Industries, Inc. (“Precision Marshall”) in July 2020. Precision Marshall is the North American leader in providing and manufacturing pre-finished de-carb-free tool and die steel. For nearly 75 years, Precision Marshall has served steel distributors through quick and accurate service.
Marketing Marquis has a team of approximately 75 full-time salespeople, who deepen customer relationships throughout its markets. 7 Table of Contents Steel-Manufacturing Segment Precision Industries, Inc. The Company acquired Precision Industries, Inc. (“Precision Marshall”) in July 2020. Precision Marshall is the North American leader in providing and manufacturing pre-finished de-carb-free tool and die steel.
We estimate that reliance upon trade secrets and unpatented proprietary know-how will continue to be our principal method of protecting our trade secrets and other proprietary technologies. We generally own (or have permissive licenses for) the intellectual property provided by third-party contractors, even though we hire such contractors to help develop our proprietary software and to provide various fulfillment services.
We generally own (or have permissive licenses for) the intellectual property provided by third-party contractors, even though we hire such contractors to help develop our proprietary software and to provide various fulfillment services. Our proprietary software is not significantly dependent on any third-party software, although our software does utilize open-source code.
Marquis’ lean operating structure, plus investments in manufacturing equipment, computer systems and marketing strategy, contributes to its ability to provide exceptional value on the basis of performance, quality, style and service. 5 Raw Materials and Suppliers We believe that we will have access to an adequate supply of raw material on satisfactory commercial terms for the foreseeable future, as we are not dependent on any single supplier.
Marquis’ lean operating structure, plus investments in manufacturing equipment, computer systems and marketing strategy, contributes to its ability to provide value on the basis of performance, quality, style and service.
Vintage Stock sells its new and used movies, video games, music, and toys through http://www.vintagestock.com. Vintage Stock’s “Cooler Than Cash” program is its customer-reward program.
Vintage Stock sells its new and used movies, video games, music, and toys through http://www.vintagestock.com. Vintage Stock’s “Cooler Than Cash” program is its customer-reward program. When Vintage Stock customers bring in items to sell, they have two options: (i) sell their pre-owned products for cash or (ii) opt for store credit and receive a 50% bonus.
Ninety-seven percent of American players view games as beneficial in some ways and eighty-nine percent view games as useful for building skills. Eighty-eight percent of American players agree video games can bring different types of people together and ninety percent of American players agree video games can create accessible experiences for people with different abilities. Competition Vintage Stock .
Ages 18-34 make up 36% in the age breakdown and 76% of all players are over 18. 65% of American adults play video games, an increase from 45% in 2015. 97% of American players view games as beneficial in some ways and 89% view games as useful for building skills. 88% of American players agree video games can bring different types of people together and 90% of American players agree video games can create accessible experiences for people with different abilities.
Kinetic manufactures more than 90 types of knives and numerous associated parts with modifications and customizations available to each. Kinetic employs approximately 100 non-union employees. The company’s website is www.knifemaker.com. 6 Products Precision Industries, Inc. Deluxe Alloy Plate Precision Marshall provides three alloy plate products in sizes from 1/4 inch to 8 inches in thickness.
Kinetic manufactures more than 90 types of knives and numerous associated parts with modifications and customizations available to each. Kinetic employs approximately 100 non-union employees. Precision Metal Works, Inc. On July 20, 2023, the Company acquired Precision Metal Works, Inc. (“PMW”).
We believe that we have a good relationship with both our unionized and non-unionized employees. We recognize that attracting, motivating and retaining talent at all levels is vital to continuing our growth and success. We offer industry-competitive wages and benefits; we are committed to maintaining a workplace environment that promotes employee productivity and satisfaction. 10
We offer industry-competitive wages and benefits; we are committed to maintaining a workplace environment that promotes employee productivity and satisfaction.
Kinetic also manufactures profile knives, shear blades, scrap choppers, and side trimmers for the steel industry. Industry and Market Precision Industries, Inc. Precision Marshall is a fully-integrated manufacturer of the above-mentioned steel products.
Kinetic also manufactures profile knives, shear blades, scrap choppers, and side trimmers for the steel industry. Precision Metal Works, Inc. PMW manufactures and sells metal stampings and stamped part assemblies for assembly into consumer and commercial appliances and automotive tier one customers. The products are highly custom and manufactured on customer owned tools for a specific application.
Removed
When Vintage Stock customers bring in items to sell, they have two options: (i) sell their pre-owned products for cash or (ii) opt for store credit and receive a 50% bonus. 2 ApplianceSmart ApplianceSmart is a household appliance retailer in Columbus, Ohio with two product categories: one consisting of typical, commonly-available, innovative appliances, and the other consisting of affordable value-priced, niche offerings, such as close-outs, factory overruns, discontinued models, and special-buy appliances, including open box merchandise and others.
Added
Live’s website also contains important information regarding our corporate governance practices. Information contained on our website is not incorporated into this Annual Report on Form 10-K.
Removed
On December 9, 2019, ApplianceSmart filed a voluntary petition (the “Chapter 11 Case”) in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) seeking relief under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”).
Added
Flooring Liquidators is a leading retailer and installer of flooring, carpeting, cabinets, and countertops to consumers, builders, and contractors in California, operating 19 warehouse-format stores and design centers. Over the years, the company has established a strong reputation for innovation, efficiency and service in the home renovation and improvement market.
Removed
The bankruptcy affected Live Ventures’ indirect subsidiary ApplianceSmart only and did not affect any other subsidiary of Live Ventures, or Live Ventures itself.
Added
Flooring Liquidators serves retail and builder customers through two businesses: retail customers through its Flooring Liquidators retail stores, and builder and contractor customers through Elite Builder Services, Inc. On June 2, 2023, Flooring Liquidators acquired certain fixed assets and other intangible assets of Cal Coast Carpets, Inc. (“Cal Coast”), and its Shareholders.
Removed
On February 28, 2022, the court approved ApplianceSmart’s plan for reorganization (the “Plan”), discharging ApplianceSmart of certain debts according to the Plan resulting in the Company recording a gain of approximately $11.4 million, which includes a write-off or adjustment of approximately $11.5 million on the settlement of debts and other liabilities, offset by payments subject to the bankruptcy that were not included as debtor-in-possession liabilities of approximately $149,000.
Added
Products Flooring Liquidators is the go-to destination for a comprehensive selection of flooring, cabinets, and countertops. Its extensive range includes top-quality imported options in hardwood, laminate, and vinyl categories, along with strong partnerships with renowned brands like Shaw/Coretec, Mohawk, MSI, Mannington, and more.
Removed
As of April 1, 2022, we have ceased operations of its one existing location, and are in the process of winding down operations, which will be immaterial to the consolidated financial statements. Marketing Vintage Stock .
Added
With esteemed manufacturers such as Lions Flooring, Gaia, Phenix, Compass Hardwood, Johnson Hardwood, Republic, Eternity, and Koville on display, Flooring Liquidators provides its customers with access to the finest products available. Market Flooring Liquidators serves a diverse customer base consisting of homeowners, property managers, builders, and contractors.
Removed
Ages 18-34 make up 36% in the age breakdown and 76% of all players are over 18. This shows that growing numbers across age and gender are finding positive benefits of video game play. Sixty-five percent of American adults play video games, an increase from 45% in 2015.
Added
Homeowners have the flexibility to choose installation options, whether it's through the Flooring Liquidators team, their preferred installer, or a DIY approach. Its e-commerce platform offers cash and carry for most products, with exceptions made for customers within a specific radius of its retail stores.
Removed
Our Market Carpet and Rugs The carpet and rug industry had shipments of approximately $13.0 billion in 2021. The carpet and rugs industry has two primary markets, residential and commercial, with the residential market making up the largest portion of the industry.
Added
Competition and Competitive Advantage Flooring Liquidators’ primary competitors are big box brands like Home Depot and Lowes, as well as other prominent players such as Floor and Decor, LL Flooring, Empire, and regional flooring companies. 4 Table of Contents Flooring Liquidators’ competitive advantages are grounded in its commitment to providing the lowest prices on flooring, countertops, and a wide range of other products.
Removed
Precision Ground Flat Stock The Precision Ground Flat Stock market provides refined tool steel, alloy and stainless flat bars are used to make tools, dies, holder blocks and industrial knives across all North American Manufacturing categories.
Added
It achieves this by directly sourcing materials from manufacturers and leveraging its efficient logistics capabilities. By eliminating unnecessary intermediaries, Flooring Liquidators can pass on cost savings to its customers, enabling it to offer premium products at competitive prices. This cost advantage sets it apart in the market, ensuring that its customers receive value for their investment.
Removed
Competitors in the steel industry include IKS, American Shear Knife (“ASKO”), which manufactures in Mexico, or overseas, and Modern Machine located in Indiana. Small machine shops are competitors to the Kinetic contract segment. 8 Raw Material and Suppliers Precision Industries, Inc. There are a limited number of suppliers in the world market across each product category.
Added
Furthermore, Flooring Liquidators’ effective logistics and warehousing operations play a pivotal role in its ability to deliver service. Through streamlined processes and attention to detail, Flooring Liquidators ensures that products are efficiently managed and readily available for its customers. This allows it to meet customer demands while maintaining high levels of quality and prompt delivery.
Removed
Our proprietary software is not significantly dependent on any third-party software, although our software does utilize open-source code.
Added
Its focus on professionalism and operational excellence enables Flooring Liquidators to address its customers' needs with precision, reinforcing its reputation as a reliable and trusted provider. Sales and Marketing Flooring Liquidators’ success in attracting customers lies in its competitive pricing strategy, a driving force behind the increased traffic to its stores and website.
Removed
Human Capital Resources As of September 30, 2022, we had approximately 1,249 employees, of whom approximately 952 were full-time employees, in the United States. Collective bargaining agreements covering 49 employees at Precision Marshall were successfully renegotiated during 2021 without a work stoppage and were extended to 2026.
Added
The cost savings that it offers not only benefit its customers but also generates organic word-of-mouth marketing, amplifying its brand presence. To further expand its reach, it has expanded its social media footprint, utilizing platforms such as Facebook, Instagram, LinkedIn, and other channels. Additionally, its targeted paid search advertising leverages co-op funds from manufacturers, creating impactful co-branded campaigns.
Added
Adhering to a lean marketing approach, Flooring Liquidators carefully allocates its advertising budget, ensuring every dollar spent yields a return on investment. Continual monitoring allows it to maintain tight control over campaigns, avoiding any significant missteps that may hinder performance. Flooring-Manufacturing Segment Marquis Industries, Inc. Marquis Industries, Inc.
Added
On September 20, 2023, Marquis acquired the Harris Flooring Group® brands from Q.E.P., a designer, manufacturer, and distributor of a broad range of best-in-class flooring and installation solutions for commercial and home improvement projects. Specifically, Marquis acquired the Harris Flooring Group brands, inventory, and book of business and retained most sales representatives.
Added
Marquis’ flooring source division is the largest of all of the brands.

… 19 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

65 edited+25 added−15 removed100 unchanged
Biggest changeAs of September 30, 2022, we had approximately $86.3 million of total consolidated indebtedness outstanding consisting of (in 000's): Bank of America Revolver Loan, variable interest rate, matures January 2025 $ 10,143 Texas Capital Bank Revolver Loan, variable interest rate, matures November 2023 9,391 Fifth-Third Bank Revolver, variable interest rate, matures January 2027 23,573 Fifth-Third Bank Term Loan, variable interest rate, matures January 2027 3,167 Fifth-Third Bank Term Loan, variable interest rate, matures January 2027 3,857 Fifth-Third Bank Special Advance Term Loan, SOFR + 375 basis points, matures June 2025 917 Note Payable to the Sellers of Kinetic, 7.0% interest rate, matures September 2027 3,000 Note #3 Payable to Banc of America Leasing & Capital LLC, 4.8% interest rate, matures December 2023 751 Note #4 Payable to Banc of America Leasing & Capital LLC, 4.9% interest rate, matures December 2023 231 Note #5 Payable to Banc of America Leasing & Capital LLC, 4.7% interest rate, matures December 2024 1,406 Note #6 Payable to Banc of America Leasing & Capital LLC, 4.7% interest rate, matures July 2024 471 Note #7 Payable to Banc of America Leasing & Capital LLC, 3.2% interest rate, matures February 2027 3,542 Note #8 Payable to Banc of America Leasing & Capital LLC, 4.0% interest rate, matures September 2027 2,500 Note #9 Payable to Banc of America Leasing & Capital LLC, 3.75% interest rate, matures December 2026 4,815 Note payable to the Sellers of Precision Marshall, no state or implied interest rate, buyer holdback 2,500 Note Payable to Store Capital Acquisitions, LLC, 9.3% interest rate, matures June 2056 9,171 Note payable to individual, 11.0% interest rate, payable on 90-day written notice 207 Note payable to individual, 10.0% interest rate, payable on 90-day written notice 500 Note payable to individual, noninterest bearing, monthly payments of $19 through March 2023 139 Note payable to individual, 7.0% interest rate, five-year notes, unsecured 198 Note payable RSSI/(VSSS), no stated or implied interest rate, matures March 2023 130 Notes payable JCM Holdings, 6.0% interest rate, matures January 2030 1,656 Total notes payable 82,265 Isaac Capital Group, LLC, 12.5% interest rate, matures May 2025 2,000 Spriggs Investments, LLC, 10% interest rate, matures July 2023 2,000 Total notes payable to related parties 4,000 Total indebtedness $ 86,265 These financial obligations may have significant negative consequences for us, including: • limiting our ability to satisfy our obligations; • increasing our vulnerability to general adverse economic and industry conditions; 12 • limiting our flexibility in planning for, or reacting to, changes in our businesses and the markets in which we operate; • placing us at a competitive disadvantage compared to competitors that have less debt; • increasing our vulnerability to, and limiting our ability to react to, changing market conditions, changes in our industry and economic downturns; • limiting our ability to obtain additional financing to fund working capital requirements, capital expenditures, debt service, acquisitions, general corporate or other obligations; • subjecting us to a number of restrictive covenants that, among other things, limit our ability to pay dividends and distributions, make acquisitions and dispositions, borrow additional funds and make capital expenditures and other investments; • restricting our and our wholly-owned subsidiaries ability to make dividend payments and other payments; • limiting our ability to use operating cash flow in other areas of our business because we must dedicate a significant portion of these funds to make principal and/or interest payments on our outstanding debt; • exposing us to interest rate risk due to the variable interest rate on borrowings under certain of our credit facilities; and • causing our failure to comply with the financial and restrictive covenants contained in our current or future indebtedness, which could cause a default under such indebtedness and which, if not cured or waived, could have a material adverse effect on us.
Biggest changeAs of September 30, 2023, we had approximately $152.8 million of total consolidated principal indebtedness outstanding consisting of (in 000's): Notes Payable Revolver loans $ 56,779 Equipment loans 15,486 Term loans 14,290 Other notes payable 15,789 Subtotal notes payable 102,344 Related Party Notes Payable Isaac Capital Group, LLC, 12.5% interest rate, matures May 2025 $ 2,000 Spriggs Investments, LLC, 10% interest rate, matures July 2024 2,000 Spriggs Investments, LLC for Flooring Liquidators, 12% interest rate, matures July 2024 1,000 Isaac Capital Group, LLC revolver, 12% interest rate, matures April 2024 1,000 Isaac Capital Group, LLC for Flooring Liquidators, 12% interest rate, matures January 2028 5,000 Subtotal related party notes payable 11,000 Sellers Notes Payable - Related Party Seller of Flooring Liquidators, 8.24% interest rate, matures January 2028 34,000 Seller of PMW, 8.0% interest rate, matures July 2028 2,500 Seller of Kinetic, 7.% interest rate, matures September 2027 3,000 Subtotal sellers notes payable 39,500 Total indebtedness $ 152,844 These financial obligations may have significant negative consequences for us, including: • limiting our ability to satisfy our obligations; • increasing our vulnerability to general adverse economic and industry conditions; • limiting our flexibility in planning for, or reacting to, changes in our businesses and the markets in which we operate; • placing us at a competitive disadvantage compared to competitors that have less debt; • increasing our vulnerability to, and limiting our ability to react to, changing market conditions, changes in our industry and economic downturns; • limiting our ability to obtain additional financing to fund working capital requirements, capital expenditures, debt service, acquisitions, general corporate or other obligations; 13 Table of Contents • subjecting us to a number of restrictive covenants that, among other things, limit our ability to pay dividends and distributions, make acquisitions and dispositions, borrow additional funds and make capital expenditures and other investments; • restricting our and our wholly-owned subsidiaries ability to make dividend payments and other payments; • limiting our ability to use operating cash flow in other areas of our business because we must dedicate a significant portion of these funds to make principal and/or interest payments on our outstanding debt; • exposing us to interest rate risk due to the variable interest rate on borrowings under certain of our credit facilities; and • causing our failure to comply with the financial and restrictive covenants contained in our current or future indebtedness, which could cause a default under such indebtedness and which, if not cured or waived, could have a material adverse effect on us.
Outages due to power outages, weather, pandemics (including the Covid-19 pandemic), or machine outages affect its capability to produce at the level necessary to meet customer demand or at all. 22 It is also possible that operations may be disrupted due to other unforeseen circumstances, such as union and other foreign tariffs, free trade agreements, trade regulations, laws, and policies.
Outages due to power outages, weather, pandemics (including the COVID-19 pandemic), or machine outages affect its capability to produce at the level necessary to meet customer demand or at all. It is also possible that operations may be disrupted due to other unforeseen circumstances, such as union and other foreign tariffs, free trade agreements, trade regulations, laws, and policies.
In addition, we cannot provide assurance that courts will always uphold our intellectual property rights or enforce the contractual arrangements that we have entered into to obtain and protect our proprietary technology. 14 Third parties, including our partners, contractors, or employees may infringe or misappropriate our copyrights, trademarks, service marks, trade dress, and other proprietary rights.
In addition, we cannot provide assurance that courts will always uphold our intellectual property rights or enforce the contractual arrangements that we have entered into to obtain and protect our proprietary technology. Third parties, including our partners, contractors, or employees may infringe or misappropriate our copyrights, trademarks, service marks, trade dress, and other proprietary rights.
In addition, public announcements of the results of hearings, motions or other interim proceedings or developments in the litigation could be perceived negatively by investors, and thus have an adverse effect on the trading price of our common stock. 15 Data breaches involving customer or employee data stored by us could adversely affect our reputation and revenues.
In addition, public announcements of the results of hearings, motions or other interim proceedings or developments in the litigation could be perceived negatively by investors, and thus have an adverse effect on the trading price of our common stock. Data breaches involving customer or employee data stored by us could adversely affect our reputation and revenues.
As a result, you may not receive any return on an investment in our common stock unless you sell your common stock for a price greater than your purchase price. 25 Certain provisions of Nevada law, in our organizational documents and in contracts to which we are party may prevent or delay a change of control of our company.
As a result, you may not receive any return on an investment in our common stock unless you sell your common stock for a price greater than your purchase price. Certain provisions of Nevada law, in our organizational documents and in contracts to which we are party may prevent or delay a change of control of our company.
Our future liquidity and capital requirements will depend on numerous factors, including: • the pace of expansion of our operations; • our response to competitive pressures; and • future acquisitions of complementary products, technologies or businesses. 13 The sale of equity or convertible debt securities could result in additional dilution to existing stockholders.
Our future liquidity and capital requirements will depend on numerous factors, including: • the pace of expansion of our operations; • our response to competitive pressures; and • future acquisitions of complementary products, technologies or businesses. The sale of equity or convertible debt securities could result in additional dilution to existing stockholders.
The acquisition of a company or business is accompanied by a number of risks, including: • failure of due diligence during the acquisition process; • adverse short-term effects on reported operating results; • the potential loss of key partners or key personnel in connection with, or as the result of, a transaction; • the impairment of relationships with clients of the acquired business, or our own customers, partners or employees, as a result of any integration of operations or the expansion of our offerings; • the recording of goodwill and intangible assets that will be subject to impairment testing on a regular basis and potential periodic impairment charges; • the diversion of management’s time and resources; • the risk of entering into markets or producing products where we have limited or no experience, including the integration or removal of the acquired or disposed products with or from our existing products; and • the inability properly to implement or remediate internal controls, procedures and policies appropriate for a public company at businesses that prior to our acquisition were not subject to federal securities laws and may have lacked appropriate controls, procedures and policies.
The acquisition of a company or business is accompanied by a number of risks, including: • failure of due diligence during the acquisition process; • adverse short-term effects on reported operating results; • the potential loss of key partners or key personnel in connection with, or as the result of, a transaction; • the impairment of relationships with clients of the acquired business, or our own customers, partners or employees, as a result of any integration of operations or the expansion of our offerings; 17 Table of Contents • the recording of goodwill and intangible assets that will be subject to impairment testing on a regular basis and potential periodic impairment charges; • the diversion of management’s time and resources; • the risk of entering into markets or producing products where we have limited or no experience, including the integration or removal of the acquired or disposed products with or from our existing products; and • the inability properly to implement or remediate internal controls, procedures and policies appropriate for a public company at businesses that prior to our acquisition were not subject to federal securities laws and may have lacked appropriate controls, procedures and policies.
We may retain future earnings, if any, for future operation, expansion, and debt repayment and, with the exception of dividends payable on shares of our Series E Preferred Stock, we have no current plans to pay cash dividends for the foreseeable future.
We may retain future earnings, if any, for future operation, expansion, and debt repayment and, with the exception of dividends payable on shares of our Series E Preferred Stock, we have no current plans to pay cash dividends on our common stock for the foreseeable future.
As a result, our sales and earnings could decline. 18 Vintage Stock may not compete effectively as browser, mobile and social video viewing and gaming becomes more popular. Listening to music, gaming, and viewing video and digital content continues to evolve rapidly.
As a result, our sales and earnings could decline. Vintage Stock may not compete effectively as browser, mobile and social video viewing and gaming becomes more popular. Listening to music, gaming, and viewing video and digital content continues to evolve rapidly.
We store confidential information with respect to our customers and employees. A compromise of our data security systems or those of businesses with which we interact could result in information related to our customers or employees being obtained by unauthorized persons.
We collect and store confidential information with respect to our customers and employees. A compromise of our data security systems or those of businesses with which we interact could result in information related to our customers or employees being obtained by unauthorized persons.
Also, the interpretation and enforcement of data protection laws in the United States are uncertain and, in certain circumstances, contradictory. These laws may be interpreted and enforced in a manner that is inconsistent with our policies and practices.
Also, the interpretation and enforcement of data protection laws in the United States and abroad are uncertain and, in certain circumstances, contradictory. These laws may be interpreted and enforced in a manner that is inconsistent with our policies and practices.
We are also subject to regular reviews, examinations, and audits by the Internal Revenue Service and other taxing authorities with respect to our tax filings. Although we believe our tax estimates are reasonable, if a taxing authority disagrees with the positions we have taken, we could face additional tax liability, including interest and penalties.
We are also subject to regular reviews, examinations, and audits by the Internal Revenue Service and other state and local taxing authorities with respect to our tax filings. Although we believe our tax estimates are reasonable, if a taxing authority disagrees with the positions we have taken, we could face additional tax liability, including interest and penalties.
Our steel manufacturing segment depends on skilled or trainable drug-free labor for the manufacture of its products. Its continued success depends on the active participation of its key employees. Our steel manufacturing segment, like other companies that reply on a trained blue-collar workforce, receives pressure from other manufacturers regarding the labor pool.
Our steel manufacturing segment depends on skilled or trainable drug-free labor for the manufacture of its products. Its continued success depends on the active participation of its key employees. Our steel manufacturing segment, like other companies that rely on a trained blue-collar workforce, receives pressure from other manufacturers regarding the labor pool.
These laws and regulations concern the generation, storage, transportation, disposal, emission or discharge of pollutants, contaminants and hazardous substances into the environment, the reporting of such matters, and the general protection of public health and safety, natural resources, wildlife and the environment. Steel producers in the EU are subject to similar laws.
These laws and regulations concern the generation, storage, transportation, disposal, emission or discharge of pollutants, contaminants and hazardous substances into the environment, the reporting of such matters, and the general protection of public health and safety, natural resources, wildlife and the environment. Steel producers in the European Union ("EU") are subject to similar laws.
Any further expansion will also place a significant strain on our existing management, operational, and financial resources. Additionally, due to changing conditions in financial markets, financing may be more difficult to obtain at rates and terms that are acceptable to the Company.
Any further expansion will also place a significant strain on our existing management, operational, and financial resources. Additionally, due to changing conditions in financial markets, financing may be more difficult or expensive to obtain at rates and terms that are acceptable to the Company.
Failure to manage our new store openings effectively could lower our sales and profitability. Our growth strategy depends in part upon Vintage Stock opening new stores and operating them profitably. Their ability to open new stores and operate them profitability depends upon a number of factors, some of which may be beyond our control.
Failure to manage our new store openings effectively could lower our sales and profitability. Our growth strategy depends in part upon opening new stores and operating them profitably. Their ability to open new stores and operate them profitability depends upon a number of factors, some of which may be beyond our control.
We use inventory replenishment systems to track sales and inventory. Our ability to rapidly process incoming shipments of new products and deliver them to all of our stores enables us to meet peak demand and replenish our stores to keep them in stock at optimum levels and to move inventory efficiently.
We use inventory replenishment systems to track sales and inventory. Our ability to rapidly process incoming shipments of new products and deliver them to all of our stores enables us to meet peak demand and replenish our stores to keep them in stock at optimal levels and to move inventory efficiently.
Our steel manufacturing segment has implemented strategic initiatives to produce more viable results during periods of economic and market downturns; but, this may not be enough to mitigate the effect that the volatility inherent in the steel industry has on our results of operations.
Our steel manufacturing segment has implemented strategic initiatives to produce more variable results during periods of economic and market downturns; but, this may not be enough to mitigate the effect that the volatility inherent in the steel industry has on our results of operations.
Our steel manufacturing segment and other steel producers have periodically faced problems obtaining sufficient raw materials in a timely manner, and sometimes at all, due to a limited number of suppliers, delays, defaults, severe weather conditions, force majeure events (including public health crises, such as the COVID-19 pandemic and general national supply chain issues), shortages, or transportation problems (such as shortages of barges, vessels, rail cars or trucks, or disruption of rail lines, waterways, or natural gas transmission lines), resulting in production curtailments.
Our steel manufacturing segment and other steel producers have periodically faced problems obtaining sufficient raw materials in a timely manner, and sometimes at all, due to a limited number of suppliers, delays, defaults, severe weather conditions, force majeure events (including public health crises, such as the COVID-19 pandemic and global supply chain issues and disruptions), shortages, or transportation problems (such as shortages of barges, vessels, rail cars or trucks, or disruption of rail lines, waterways, or natural gas transmission lines), resulting in production curtailments.
If these consoles and other advances in technology continue to expand our customers’ ability to access and download the current format of video, music and games and incremental content from their games and videos through these and other sources, our customers may no longer choose to purchase videos, DVDs, video games and music in our stores or they may reduce their purchases in favor of other forms of video, digital, and game delivery.
If these consoles and other advances in technology continue to expand our customers’ ability to access and download the current format of video, music and games and incremental content from their games and videos through these and other 18 Table of Contents sources, our customers may no longer choose to purchase videos, DVDs, video games and music in our stores or they may reduce their purchases in favor of other forms of video, digital, and game delivery.
These factors include, but are not limited to: • the timing and allocations of new product releases; • the timing of new store openings or closings; • shifts in the timing or content or certain promotions or service offerings; • the effect of changes in tax rates in the jurisdictions in which we are operating; • acquisition costs and the integration of companies we acquire or invest in; and • the costs associated with the exit of unprofitable markets or stores.
These factors include, but are not limited to: • the timing and allocations of new product releases; • the timing of new store openings or closings; 19 Table of Contents • shifts in the timing or content or certain promotions or service offerings; • the effect of changes in tax rates in the jurisdictions in which we are operating; • acquisition costs and the integration of companies we acquire or invest in; and • the costs associated with the exit of unprofitable markets or stores.
There can be no assurance that payment of such additional amounts upon final adjudication of any disputes will not have a material impact on our results of operations and financial position. We also need to comply with new, evolving or revised tax laws and regulations.
There 16 Table of Contents can be no assurance that payment of such additional amounts upon final adjudication of any disputes will not have a material impact on our results of operations and financial position. We also need to comply with new, evolving or revised tax laws and regulations.
International events could delay or prevent the delivery of products to our suppliers. Some of Vintage Stock’s suppliers rely on foreign sources to manufacture a portion of the products or raw materials that we purchase from them.
International events could delay or prevent the delivery of products to our suppliers. Some of our suppliers rely on foreign sources to manufacture a portion of the products or raw materials that we purchase from them.
Moreover, such a concentration of voting power could have the effect of delaying or preventing a third party from acquiring us. This significant concentration of share ownership may also adversely affect the trading price for our common stock because investors may perceive disadvantages in owning stock in companies with concentrated stock ownership.
Moreover, such a concentration of voting power could have the effect of delaying or preventing a third party from acquiring us. This significant concentration of share ownership may also adversely affect the trading price 24 Table of Contents for our common stock because investors may perceive disadvantages in owning stock in companies with concentrated stock ownership.
We may be subject to investigations, arbitration proceedings, audits, regulatory inquiries and similar actions, including matters related to intellectual property, employment, securities laws, disclosures, tax, accounting, class action and product liability, as well as regulatory and other claims related to our business and our industry, which we refer to collectively as legal proceedings.
We have been, and may continue to be subject to investigations, arbitration proceedings, audits, regulatory inquiries and similar actions, including matters related to intellectual property, employment, securities laws, disclosures, tax, accounting, class action and product liability, as well as regulatory and other claims related to our business and our industry, which we refer to collectively as legal proceedings.
Technological advances in the delivery and types of video, video games and PC entertainment software, as well as changes in consumer behavior related to these new technologies, could lower Vintage Stock’s sales.
Technological advances in the delivery and types of video, video games and PC entertainment software, as well as changes in consumer behavior related to these new technologies, could lower sales.
If those automakers do not introduce a new model in any given year, our sales may decrease which will have a negative impact on our business, financial condition (including, without limitation, our liquidity), results of operations, and cash flows and, indirectly, ours.
If those automakers do not introduce a new model in any given year, our sales may decrease which will have a negative impact on 21 Table of Contents our business, financial condition (including, without limitation, our liquidity), results of operations, and cash flows and, indirectly, ours.
We cannot predict the outcome of any particular proceeding, or whether ongoing investigations will be resolved favorably or ultimately result in charges or material damages, fines or other penalties, enforcement actions, bars against serving as an officer or director, or practicing before the SEC, or civil or criminal proceedings against us or members of our senior management.
We cannot predict the outcome of any particular proceeding, or whether ongoing investigations will be resolved favorably or ultimately result in charges or material damages, fines or other penalties, enforcement actions, bars against serving as an officer or director, or regulation by the SEC, or civil or criminal proceedings against us or members of our senior management.
These provisions of Nevada law and our articles of incorporation and bylaws could prohibit or delay mergers or other takeover or change of control of our company and may discourage attempts by other companies to acquire us, even if such a transaction would be beneficial to our stockholders. ITEM 1B. Unres olved Staff Comments None. 26
These provisions of Nevada law and our articles of incorporation and bylaws could prohibit or delay mergers or other takeover or change of control of our company and may discourage attempts by other companies to acquire us, even if such a transaction would be beneficial to our stockholders. ITEM 1B. Unresolved Staff Comments None.
In addition, such claims or litigation could force us to do one or more of the following: • cease selling or using any of our products and services that incorporate the subject intellectual property, which would adversely affect our revenue; • attempt to obtain a license from the holder of the intellectual property right alleged to have been infringed or misappropriated, which license may not be available on reasonable terms, if at all; and • attempt to redesign or, in the case of trademark claims, rename our products or services to avoid infringing or misappropriating the intellectual property rights of third parties, which may be costly and time-consuming.
In addition, such claims or litigation could force us to do one or more of the following: • cease selling or using any of our products and services that incorporate the subject intellectual property, which would adversely affect our revenue; • attempt to obtain a license from the holder of the intellectual property right alleged to have been infringed or misappropriated, which license may not be available on reasonable terms, if at all; and 15 Table of Contents • attempt to redesign or, in the case of trademark claims, rename our products or services to avoid infringing or misappropriating the intellectual property rights of third parties, which may be costly and time-consuming and fail to gain market acceptance.
In addition, neither entity may be able to enter into new leases on favorable terms or at all, or may not be able to locate suitable alternative sites or additional sites for new store expansion in a timely manner.
In addition, we may not be able to enter into new leases on favorable terms or at all, or may not be able to locate suitable alternative sites or additional sites for new store expansion in a timely manner.
Results of operations may fluctuate from quarter to quarter. Vintage Stock’s results of operations may fluctuate from quarter to quarter depending upon several factors, some of which are beyond our control.
Results of operations may fluctuate from quarter to quarter. Results of operations may fluctuate from quarter to quarter depending upon several factors, some of which are beyond our control.
While Vintage Stock takes steps to comply with these laws, there can be no assurance that they will be in compliance, and failure to comply with these laws could result in penalties that could have a negative impact on their respective businesses, financial condition, and results of operations, cash flows and liquidity.
While we take steps to comply with these laws, there can be no assurance that they will be in compliance, and failure to comply with these laws could result in penalties that could have a negative impact on their respective businesses, financial condition, and results of operations, cash flows and liquidity.
As a result, any event causing a disruption of imports, including natural disasters or the imposition of import restrictions or trade restrictions in the form of tariffs or quotas, could increase the cost and reduce the supply of products available to Vintage Stock, which could lower their sales and profitability and, indirectly, ours.
As a result, any event causing a disruption of imports, including natural disasters, supply chain disruptions or the imposition of import restrictions or trade restrictions in the form of tariffs or quotas, could increase the cost and reduce the supply of products available, which could lower their sales and profitability and, indirectly, ours.
These and other factors could affect their respective businesses, financial condition and results of operations, cash flows and liquidity, and this makes the prediction of our financial results on a quarterly basis difficult. Also, it is possible that our quarterly financial results may be below the expectations of public market analysts.
These and other factors could affect its business, financial condition and results of operations, cash flows and liquidity, and this makes the prediction of our financial results on a quarterly basis difficult. Also, it is possible that our quarterly financial results may be below the expectations of public market analysts.
RISKS RELATED TO OUR RETAIL SEGMENT Economic conditions in the U.S. could adversely affect demand for the products we sell. Sales of products by Vintage Stock are driven, in part, by discretionary spending by consumers. Consumers are typically more likely to make discretionary purchases, including purchasing movies, games, music, and other discretionary products when there are favorable economic conditions.
RISKS RELATED TO OUR RETAIL-ENTERTAINMENT AND RETAIL-FLOORING SEGMENTS Economic conditions in the U.S. could adversely affect demand for the products we sell. Sales of products are driven, in part, by discretionary spending by consumers. Consumers are typically more likely to make discretionary purchases, including purchasing movies, games, music, flooring, and other discretionary products when there are favorable economic conditions.
As a result, our sales of those games may decrease, which could negatively impact our results of operations. As a seller of certain consumer products, Vintage Stock is subject to various federal, state, and local laws, regulations, and statutes related to product safety and consumer protection.
As a result, our sales of those games may decrease, which could negatively impact our results of operations. As a seller of certain consumer products, we are subject to various federal, state, and local laws, regulations, and statutes related to product safety and consumer protection.
GENERAL RISK FACTORS Adverse developments in our ongoing proceeding or future legal proceedings could have a material adverse effect on our business operations and prospects, reputation, financial condition, results of operations, or stock price.
Adverse developments in our ongoing legal proceedings or future legal proceedings could have a material adverse effect on our business operations and prospects, reputation, financial condition, results of operations, or stock price.
As of December 8, 2022, Isaac Capital Group LLC (“ICG”), together with Jon Isaac, our President and CEO and the President and sole member of ICG, control approximately 50.2% of the outstanding voting power of our company (assuming the exercise of all outstanding and exercisable warrants held by them).
As of December 11, 2023, Isaac Capital Group LLC (“ICG”), together with Jon Isaac, our President and CEO and the President and sole member of ICG, control approximately 48.8% of the outstanding voting power of our company (assuming the exercise of all outstanding and exercisable warrants held by them).
Their revenues and earnings may decline if they fail to maintain existing store locations, enter into new leases, locate alternative sites, or find additional sites for new store expansion. 19 An adverse trend in sales during the winter and holiday selling season could impact our financial results.
Its revenues and earnings may decline if it fails to maintain existing store locations, enter into new leases, locate alternative sites, or find additional sites for new store expansion. An adverse trend in sales during the winter and holiday selling season could impact our financial results.
Such factors include the following: • fluctuating demand for our products and services; • changes in economic conditions and the amount of consumers’ discretionary spending; • changes in technologies favored by consumers; • customer refunds or cancellations; • our ability to continue to bill our customers through existing means; • market acceptance of new or enhanced versions of our services or products; • new product offerings or price competition (or pricing changes) by us or our competitors; • with respect to our retail segment, the opening of new stores by competitors in our markets; • with respect to our manufacturing segment, changes in import tariffs; • the amount and timing of expenditures for the acquisition of new businesses and the expansion of our operations, including the hiring of new employees, capital expenditures, and related costs (including wage cost increases due to historically low unemployment); • recent steep increases at the consumer-level (CPI), including rising prices for gasoline, may dampen consumer spending at our retail establishments; • the COVID-19 pandemic and resulting adverse economic conditions has had and may continue to have a negative impact on our business, financial condition and results of operations; • technical difficulties or failures affecting our systems in general; and • the fixed nature of a significant amount of our operating expenses. 11 Our obligations under our consolidated indebtedness are significant.
Such factors include the following: • fluctuating demand for our products and services; • changes in economic conditions and the amount of consumers’ discretionary spending; • changes in technologies favored by consumers; • customer refunds or cancellations; • our ability to continue to bill our customers through existing means; • market acceptance of new or enhanced versions of our services or products; • new product offerings or price competition (or pricing changes) by us or our competitors; • with respect to our retail segment, the opening of new stores by competitors in our markets; • with respect to our manufacturing segment, changes in import tariffs; • the amount and timing of expenditures for the acquisition of new businesses and the expansion of our operations, including the hiring of new employees, capital expenditures, and related costs (including 12 Table of Contents wage cost increases due to historically low unemployment rates and staffing shortages in certain industries); • inflationary trends, including recent steep increases in the costs of consumer goods (as measured by CPI), including rising prices for gasoline, may dampen consumer spending at our retail establishments; • the COVID-19 pandemic and the resulting adverse economic conditions the pandemic has had and may continue to have on our business, financial condition and results of operations; • technical difficulties or failures affecting our technical and operating systems in general; and • the fixed nature of a significant amount of our operating expenses.
If we are unable to renew or enter into new leases on favorable terms, our revenue growth may decline. All of Vintage Stock’s retail stores are located in leased premises. If the cost of leasing existing stores increases, neither entity can be certain that either will be able to maintain their respective existing store locations as leases expire.
If we are unable to renew or enter into new leases on favorable terms, our revenue growth may decline. All of our retail stores are located in leased premises. If the cost of leasing existing stores increases, we can't be certain that we will be able to maintain its existing store locations as leases expire.
Steel consumption is highly cyclical and generally follows economic and industrial conditions both worldwide and in regional markets. This volatility makes it difficult to balance the procurement of raw materials and energy with global steel prices, our steel production and customer product demand.
The steel industry is highly cyclical, which may have an adverse effect on our results of operations. Steel consumption is highly cyclical and generally follows economic and industrial conditions both worldwide and in regional markets. This volatility makes it difficult to balance the procurement of raw materials and energy with global steel prices, our steel production and customer product demand.
On September 7, 2022, the court denied the motions to dismiss. 16 RISKS RELATED TO OUR BUSINESS STRATEGY We may not be able to identify, acquire or establish control of, or effectively integrate previously acquired businesses, which could materially adversely affect our growth.
RISKS RELATED TO OUR BUSINESS STRATEGY We may not be able to identify, acquire or establish control of, or effectively integrate previously acquired businesses, which could materially adversely affect our growth.
Our operating results have historically fluctuated significantly, and we could continue to experience fluctuations or revert to declining operating results due to factors that may or may not be within our control.
RISKS RELATING TO OUR COMPANY GENERALLY Our results of operations could fluctuate due to factors outside of our control. Our operating results have historically fluctuated significantly, and we could continue to experience fluctuations or declining operating results due to factors that may or may not be within our control.
Marquis faces competition from a number of manufacturers and independent distributors, many of whom have more resources than it. Maintaining its competitive position may require substantial investments in its product development efforts, manufacturing facilities, distribution network, and sales and marketing activities. Competitive pressures may also result in decreased demand for our products or force it to lower its prices.
Marquis faces competition from a number of manufacturers and independent distributors, many of whom have greater financial and operational resources than it. Maintaining its competitive position may require substantial investments in its product development efforts, manufacturing facilities, distribution network, and sales and marketing activities.
If tariffs were to rise disproportionally on raw materials compared to finished tools, we would be at risk for manufacturers to cease purchasing the products from it and instead purchasing products from third parties who are not subject to such tariffs, trade agreements, laws, and/or policies. 23 The steel industry is highly cyclical, which may have an adverse effect on our results of operations.
If tariffs were to rise disproportionally on raw materials compared to finished goods, we would be at risk for manufacturers to cease purchasing the products from it and instead purchasing products from third parties who are not subject to such tariffs, trade agreements, laws, and/or policies.
We are involved in an ongoing SEC investigation, which could divert management’s focus, result in substantial investigation expenses and have an adverse impact on our reputation, financial condition, results of operations and cash flows. On February 21, 2018, the Company received a subpoena from the SEC and a letter from the SEC stating that it is conducting an investigation.
We are involved in an ongoing SEC investigation, which could divert management’s focus, result in substantial investigation expenses and have an adverse impact on our reputation, financial condition, results of operations and cash flows.
If we fail to remediate a material weakness, or are otherwise unable to maintain effective internal control over financial reporting, management could be required to expend significant resources and we could fail to meet our public reporting requirements on a timely basis, and be subject to fines, penalties, investigations or judgements, all of which could negatively affect investor confidence and adversely impact our stock price.
Also, projections of any evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 14 Table of Contents If we fail to remediate a material weakness, or are otherwise unable to maintain effective internal control over financial reporting, management could be required to expend significant resources and we could fail to meet our public reporting requirements on a timely basis, and be subject to fines, penalties, investigations or judgements, all of which could negatively affect investor confidence and adversely impact our stock price.
In addition, if operations in any of our distribution centers were to shut down or be disrupted for a prolonged period of time or if these centers were unable to accommodate the continued store growth in a particular region, our business would suffer. 20 We may record future goodwill impairment charges or other asset impairment charges which could negatively impact our future results of operations and financial condition.
In addition, if operations in any of our distribution centers were to shut down or be disrupted for a prolonged period of time or if these centers were unable to accommodate the continued store growth in a particular region, our business would suffer.
Precision Marshall relies on raw material sources in the EU and U.S. Tightening of those requirements in the EU and/or sources in the U.S. could deter steel produces from producing the raw material for our products or result in significant price increases of our raw material.
Tightening of those requirements in the EU and/or sources in the U.S. could deter steel produces from producing the raw material for our products or result in significant price increases of our raw material. GENERAL RISK FACTORS We depend on key persons and the loss of any key person could adversely affect our operations.
During such periods of time, the occurrence of such events may materially adversely affect Marquis’ business, financial condition, and results of operations and, indirectly, ours. 21 RISKS RELATED TO OUR STEEL MANUFACTURING SEGMENT The demand for steel manufacturing segment's products may decrease if manufacturing in North America declines or if automakers, who manufacture their products in the U.S., do not introduce new models or their sales decline.
RISKS RELATED TO OUR STEEL MANUFACTURING SEGMENT The demand for steel manufacturing segment's products may decrease if manufacturing in North America declines or if automakers, who manufacture their products in the U.S., do not introduce new models or their sales decline.
Due to our current borrowings against our floating rate credit facilities, or if we were to increase our floating rate credit borrowings, a significant increase in interest rates generally could have an adverse effect on our financial condition and results of operations.
Due to our current borrowings under our floating rate credit facilities, or if we were to increase our floating rate credit borrowings, an increase in interest rates could have an adverse effect on our financial condition and results of operations. As of the year ended September 30, 2023, our amount of floating rate credit borrowings was approximately $56.8 million.
Future negotiations prior to the expiration of the collective bargaining agreements may result in labor unrest for which a strike or work stoppage is possible. Strikes and/or work stoppages could negatively affect Precision Marshall’s operational and financial results and may increase operating expenses and, indirectly, ours.
Future negotiations prior to the expiration of the collective bargaining agreements may result in labor unrest for which a strike or work stoppage is possible.
There have been in the past, and may be in the future, periods of time during which increases in these costs cannot be recovered.
There have been in the past, and may be in the future, periods of time during which increases in these costs cannot be recovered. During such periods of time, the occurrence of such events may materially adversely affect Marquis’ business, financial condition, and results of operations and, indirectly, ours.
Complying with these laws and regulations subjects us to substantial expense and non-compliance could expose us to significant liabilities. We could suffer losses from these and similar cases, and the amount of such losses or costs could be significant.
We could suffer losses from these and similar cases, and the amount of such losses or costs could be significant.
To the extent that the goodwill arising from the acquisitions carried on the financial statements does not pass the annual goodwill impairment test, excess goodwill will be charged to, and reduce, future earnings. 17 Because we do not intend to use our own employees or members of management to run the daily operations at our acquired companies, business operations might be interrupted if employees at the acquired businesses were to resign, or be terminated.
Because we do not intend to use our own employees or members of management to run the daily operations at our acquired companies, business operations might be interrupted if employees at the acquired businesses were to resign, or be terminated.
We have expanded our Company over the past few years through the acquisition of different businesses in different industries. We intend to acquire additional businesses (possibly in different sectors) in the future.
If we do not effectively manage our growth and business, our management, administrative, operational, and financial infrastructure and results of operations may be materially and adversely affected. We have expanded our Company over the past few years through the acquisition of different businesses in different industries. We intend to acquire additional businesses (possibly in different sectors) in the future.
In addition, our steel manufacturing segment outsources all disposal of waste material, non-compliance by third party providers could result in additional costs to defend environmental claims or additional costs to replace the outsourced entities.
The amount and timing of environmental expenditures is difficult to predict, and, in some cases, liability may be imposed without regard to contribution or to whether we knew of, or caused, the release of hazardous substances. 23 Table of Contents In addition, our steel manufacturing segment outsources all disposal of waste material, non-compliance by third party providers could result in additional costs to defend environmental claims or additional costs to replace the outsourced entities.
Furthermore, compliance with the environmental permitting and approval requirements may be costly and time consuming and could result in delays or other adverse impacts on planned projects, our results of operations and cash flows. 24 Increasing pressure to reduce greenhouse gas (GHG) emissions from steelmaking operations to comply with EU regulations as well as societal expectations could increase costs to manufacture future raw materials or reduce the amount of materials being manufactured.
Increasing pressure to reduce greenhouse gas (GHG) emissions from steelmaking operations to comply with U.S. and EU regulations as well as societal expectations could increase costs to manufacture future raw materials or reduce the amount of materials being manufactured. Precision Marshall relies on raw material sources in the EU and U.S.
We have previously recorded significant goodwill as a result of our acquisition of Vintage Stock. Because we have grown in part through acquisitions, goodwill and other acquired intangible assets represent a substantial portion of our assets.
We may record future goodwill impairment charges or other asset impairment charges which could negatively impact our future results of operations and financial condition. We have previously recorded significant goodwill. Because we have grown in part through acquisitions, goodwill and other acquired intangible assets represent a substantial portion of our assets.
Compliance with existing and new environmental regulations, environmental permitting and approval requirements may result in delays or other adverse impacts on planned projects, our results of operations and cash flows. Steel producers in the U.S., along with their customers and suppliers, are subject to numerous federal, state, and local laws and regulations relating to the protection of the environment.
Steel producers in the U.S., along with their customers and suppliers, are subject to numerous federal, state, and local laws and regulations relating to the protection of the environment.
We rely on third parties for transportation services, and increases in costs or the availability of transportation may adversely affect our business and operations Our steel manufacturing segment’s business depends on the transportation of a large number of products. It relies primarily on third parties for transportation of its products, as well as delivery of its raw materials.
Strikes and/or work stoppages could negatively affect Precision Marshall’s operational and financial results and may increase operating expenses and, indirectly, ours. 22 Table of Contents We rely on third parties for transportation services, and increases in costs or the availability of transportation may adversely affect our business and operations Our steel manufacturing segment’s business depends on the transportation of a large number of products.
As a result, downturns, or volatility in any of the markets served could adversely affect our steel manufacturing segment’s financial position, results of operations and cash flows and, indirectly, ours. We are subject to foreign currency risks, which may negatively impact our profitability and cash flows.
As a result, downturns, or volatility in any of the markets served could adversely affect our steel manufacturing segment’s financial position, results of operations and cash flows and, indirectly, ours. Compliance with existing and new environmental regulations, environmental permitting and approval requirements may result in delays or other adverse impacts on planned projects, our results of operations and cash flows.
Moreover, a strong U.S. dollar, combined with lower fuel costs, may contribute to more attractive pricing for imports that compete with Marquis’ products, which may put pressure on its pricing. The occurrence of one or more of these factors could materially adversely affect its business, financial condition, and results of operations and, indirectly, ours.
Competitive pressures may also result in decreased demand for our products or force it to lower its prices. Moreover, a strong U.S. dollar, combined with lower fuel costs, may contribute to more attractive pricing for imports that compete with Marquis’ products, which may put pressure on its pricing.
Removed
ITEM 1A. Risk Factors The following are certain risks that could affect our business and our results of operations. The risks identified below are not all encompassing but should be considered in establishing an opinion of our future operations. RISKS RELATING TO OUR COMPANY GENERALLY Our results of operations could fluctuate due to factors outside of our control.
Added
ITEM 1A. Risk Factors In the following paragraphs, the Company describes some of the principal risks and uncertainties that could adversely affect its business, results of operations, financial condition (including capital and liquidity), or prospects or the value of or return on an investment in the Company.
Removed
As of the year ended September 30, 2022, the amount of floating rate credit borrowings is approximately $51.0 million. If we do not effectively manage our growth and business, our management, administrative, operational, and financial infrastructure and results of operations may be materially and adversely affected.
Added
These risks and uncertainties, however, are not the only ones faced by the Company. Other risks and uncertainties that are not presently known to the Company that it has failed to identify, or that it currently considers immaterial may adversely affect the Company as well.
Removed
Also, projections of any evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Added
Except where otherwise noted, the risk factors address risks and uncertainties that may affect the Company as well as its subsidiaries. These risk factors should be read in conjunction with Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Notes to the Financial Statements located in Item 8 of this Form 10-K.
Removed
On October 1, 2018, the Company received a letter from the SEC requesting information regarding a potential violation of Section 13(a) of the Securities Exchange Act of 1934, based upon the timing of the Company’s Form 8-K filed on February 14, 2018.
Added
Our obligations under our consolidated indebtedness are significant.
Removed
On August 12, 2020, three of the Company’s corporate executive officers (together, the “Executives”) each received a “Wells Notice” from the Staff of the SEC relating to the Company’s SEC investigation. On October 7, 2020, the Company received a “Wells Notice” from the Staff of the SEC relating to the Company’s previously-disclosed SEC investigation.
Added
Complying with these laws and regulations subjects us to substantial expense and non-compliance could expose us to significant liabilities. We have previously been subject to litigation regarding certain of these matters and may be subject to similar cases in the future.
Removed
On August 2, 2021, the SEC Complaint was filed and, on August 13, 2021, the Sieggreen Class Action was filed. On October 1, 2021, the Company filed a motion to dismiss the SEC Complaint. The SEC filed its response opposing the motions on November 1, 2021. The defendants filed their reply responses to the SEC’s opposition on November 15, 2021.
Added
On August 2, 2021, the SEC filed a civil complaint in the United States District Court for the District of Nevada naming the Company and two of its executive officers - Jon Isaac, the Company’s current President and Chief Executive Officer, and Virland Johnson, the Company’s former Chief Financial Officer, as defendants (collectively, the “Company Defendants”) as well as certain other related third parties (the “SEC Complaint”).
Removed
The video game industry is cyclical and affected by the introduction of next-generation consoles, two of which were released in Fall 2020. The introduction of these new consoles could negatively impact the demand for existing products or Vintage Stock’s pre-owned business model.
Added
The SEC Complaint alleges various financial, disclosure, and reporting violations related to income and earnings per share data, purported undisclosed stock promotion and trading, purported inaccurate disclosure regarding beneficial ownership of common stock, and undisclosed executive compensation from 2016 through 2018.
Removed
The video game industry is cyclical in nature because of the introduction and maturation of new technology: Two new consoles were introduced in November 2020; following the introduction of the new video game consoles, sales of these consoles and related software and accessories generally increase due to initial demand, while sales of older platforms and related products generally decrease as customers migrate to the new platforms.

… 25 more changes not shown on this page.

Item 2. Properties

Properties — owned and leased real estate

2 edited+4 added−3 removed0 unchanged
Biggest changeThe following is a breakdown by state and brand of Vintage Stock retail stores: State Retail Stores Brand(s) Arkansas 2 Vintage Stock Colorado 3 EntertainMart Idaho 2 EntertainMart Illinois 1 Vintage Stock Kansas 6 Vintage Stock and EntertainMart Missouri 19 Vintage Stock, V-Stock and EntertainMart Nebraska 1 EntertainMart New Mexico 1 EntertainMart Oklahoma 12 Vintage Stock Texas 19 Movie Trading Co. and EntertainMart Utah 2 EntertainMart Flooring Manufacturing Segment Marquis owns or leases all of the land, and owns all of the improvements on such leased land, as described in the following table, which also provides information regarding the general location and use at September 30, 2022: Property Location Coating Plant Chatsworth, Georgia Corporate Offices and Warehouse Chatsworth, Georgia Distribution Chatsworth, Georgia Eton Tufting Facility Eton, Georgia Machine Storage and Forklift Chatsworth, Georgia Office and Storage Chatsworth, Georgia Printing Facility Calhoun, Georgia Sales Offices, Showroom and Warehouse Chatsworth, Georgia Storage and Extrusion Dalton, Georgia Tufting Department Chatsworth, Georgia Twist and Heat Set Facility Chatsworth, Georgia Warehouse Chatsworth, Georgia Yarn Processing Facility Dalton, Georgia Yarn Winding Facility Chatsworth, Georgia 27 Steel Manufacturing Segment At September 30, 2022, Precision Marshall leases the buildings for its two locations in Illinois and Pennsylvania, and Kinetic leases the buildings for its two locations in Wisconsin.
Biggest changeThe following is a breakdown of Flooring Liquidator's retail stores by city and state: City State Locations Brand(s) Arroyo Grande California 1 FL Retail Bakersfield California 2 FL Retail Clovis California 2 FL Retail Fresno California 2 FL Retail, A&M Retail Merced California 1 FL Retail Modesto California 2 FL Retail, House of Carpets Rancho Cordova California 1 FL Retail Roseville California 1 FL Retail Sacramento California 1 FL Retail San Diego California 1 FL Retail San Marcos California 1 FL Retail Santa Clara California 1 FL Retail Stockton California 1 FL Retail Tulare California 1 FL Retail Yuba City California 1 FL Retail Flooring Manufacturing Segment Marquis owns or leases all of the land, and owns all of the improvements on such leased land, as described in the following table, which also provides information regarding the general location and use at September 30, 2023: Property Location Coating Plant Chatsworth, Georgia Corporate Offices and Warehouse Chatsworth, Georgia Distribution Chatsworth, Georgia Eton Tufting Facility Eton, Georgia Machine Storage and Forklift Chatsworth, Georgia Office and Storage Chatsworth, Georgia Printing Facility Calhoun, Georgia Sales Offices, Showroom and Warehouse Chatsworth, Georgia Storage and Extrusion Dalton, Georgia Tufting Department Chatsworth, Georgia Twist and Heat Set Facility Chatsworth, Georgia Warehouse Chatsworth, Georgia Yarn Processing Facility Dalton, Georgia Yarn Winding Facility Chatsworth, Georgia Steel Manufacturing Segment At September 30, 2023, Precision Marshall leased the buildings for its two locations in Illinois and Pennsylvania, and its corporate office is also located in Pennsylvania.
Retail Segment Vintage Stock At September 30, 2022, Vintage Stock leased all 68 of its stores under agreements that vary as to rental amounts, expiration dates, renewal options and other rental provisions. Vintage Stock leased its corporate offices in Joplin, Missouri.
Properties At September 30, 2023, we leased approximately 16,500 square feet of space located in Las Vegas, Nevada which we utilize as principal executive and administrative offices. 25 Table of Contents Retail-Entertainment Segment Vintage Stock At September 30, 2023, Vintage Stock leased all 70 of its stores under agreements that vary as to rental amounts, expiration dates, renewal options and other rental provisions.
Removed
ITEM 2. Properties At September 30, 2022, we leased approximately 16,500 square feet of space located in Las Vegas, Nevada which we utilize as principal executive and administrative offices.
Added
Vintage Stock leases its corporate offices in Joplin, Missouri.
Removed
SW Financial leases approximately 5,000 square feet of office space in Melville, New York, as its principal executive and administrative offices, and an additional 3,900 square feet of administrative office space in New York City, New York.
Added
The following is a breakdown by state and brand of Vintage Stock retail stores: State Retail Stores Brand(s) Arkansas 3 Vintage Stock Colorado 4 EntertainMart Idaho 3 EntertainMart Illinois 1 Vintage Stock Kansas 6 Vintage Stock and EntertainMart Missouri 20 Vintage Stock, V-Stock, and EntertainMart Nebraska 1 EntertainMart New Mexico 1 EntertainMart Oklahoma 12 Vintage Stock Texas 17 Movie Trading Co. and EntertainMart Utah 2 EntertainMart 26 Table of Contents Retail-Flooring Segment As of September 30, 2023, Flooring Liquidators leased all 19 of its retail stores and warehouses under agreements that vary as to rental amounts, expiration dates, renewal options and other rental provisions.
Removed
Precision Marshall’s corporate office is located in Pennsylvania.
Added
Flooring Liquidators leases its corporate offices in Modesto, California, as well as its distribution center in Plymouth, MN.
Added
Kinetic leases the buildings for its two locations in Wisconsin. PMW leases the buildings for its three locations in Kentucky. 27 Table of Contents

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed0 unchanged
Biggest changeITEM 3. Le gal Proceedings The information in response to this item is included in Note 17, Commitments and Contingencies, to the Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. ITEM 4 . Mine Safety Disclosures Not applicable. 28 PART II
Biggest changeITEM 3. Legal Proceedings The information in response to this item is included in Note 17, Commitments and Contingencies, to the Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. ITEM 4 . Mine Safety Disclosures Not applicable. 28 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+4 added−7 removed1 unchanged
Biggest changeOur declaration and payment of cash dividends in the future and the amount thereof will depend upon our results of operations, financial condition, cash requirements, prospects, limitations imposed by credit agreements and/or indentures governing debt securities and other factors deemed relevant by our Board of Directors. 29 Issuer Purchases of Equity Securities On February 20, 2018, the Company announced a $10 million common stock repurchase plan.
Biggest changePresently, we do not pay dividends on shares of our common stock. Our declaration and payment of cash dividends in the future and the amount thereof will depend upon our results of operations, financial condition, cash requirements, prospects, limitations imposed by credit agreements and/or indentures governing debt securities and other factors deemed relevant by our Board of Directors.
We have no record of the number of holders of our common stock who hold their shares in “street name” with various brokers. Dividend Policy We have two classes of authorized preferred stock. As of September 30, 2022, our Series E Preferred Stock had 47,840 shares issued and outstanding.
We have no record of the number of holders of our common stock who hold their shares in “street name” with various brokers. Dividend Policy We have one class of authorized preferred stock. As of September 30, 2023, our Series E Preferred Stock had 47,840 shares issued and outstanding.
The following table provides information regarding repurchases of our common stock during the period of October 1, 2020 through September 30, 2022.
The following table provides information regarding repurchases of our common stock during the period of October 1, 2021 through September 30, 2023.
Each share of Series E Preferred Stock is entitled to and receives a dividend of $0.015 per year. During the year ending September 30, 2022, dividends of approximately $720 were paid to holders of Series E Preferred Stock. At September 30, 2022, the Company had accrued and unpaid preferred stock dividends totaling an aggregate of approximately $200.
Each share of Series E Preferred Stock is entitled to and receives a dividend of $0.015 per year. During the year ending September 30, 2023, dividends of approximately $900 were paid to holders of Series E Preferred Stock. At September 30, 2023, the Company had no accrued and unpaid preferred stock dividends.
Removed
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our Common Stock Our common stock is traded on the Nasdaq Capital Market under the symbol “LIVE”. The following table sets forth the quarterly high and low trading prices per share of our common stock during the last two fiscal years.
Added
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Holders of Record As of September 30, 2023, there were (i) 198 holders of record of our common stock, and (ii) 29 holders of record of our Series E Preferred Stock.
Removed
Quarter Ended High ($) Low ($) 2021 October 1 – December 31, 2020 $ 13.90 $ 7.93 January 1 – March 31, 2021 $ 36.00 $ 11.50 April 1 – June 30, 2021 $ 75.25 $ 23.65 July 1 – September 30, 2021 $ 66.48 $ 24.84 2022 October 1 – December 31, 2021 $ 45.20 $ 29.13 January 1 – March 31, 2022 $ 45.00 $ 23.74 April 1 – June 30, 2022 $ 43.87 $ 23.37 July 1 – September 30, 2022 $ 36.80 $ 23.82 Holders of Record As of September 30, 2022, there were (i) 197 holders of record of our common stock, (ii) 29 holders of record of our Series E Preferred Stock, and (iii) no holders of record of our Series B Convertible Preferred Stock (“Series B Preferred Stock”).
Added
Issuer Purchases of Equity Securities On February 20, 2018, the Company announced a $10 million common stock repurchase plan.
Removed
As of September 30, 2022, our Series B Preferred Stock had no shares issued and outstanding.
Added
Period Number of Shares Average Purchase Price Paid Number of Shares Purchased as Part of a Publicly Announced Plan or Program Maximum Amount that May be Purchased Under the Announced Plan or Program Balance Forward as September 2022 504,921 11.62 504,921 4,034,751 October 2022 14,224 25.14 14,224 3,677,127 November 2022 6,596 25.25 6,596 3,510,595 December 2022 3,890 25.07 3,890 3,413,066 January 2023 674 25.30 674 3,396,012 May 2023 193 25.64 193 3,391,064 June 2023 13,413 25.70 3,509 3,302,316 July 2023 102 25.79 102 3,299,685 August 2023 — — — 3,299,685 September 2023 — — — 3,299,685 Totals 544,013 534,109 29 Table of Contents On June 13, 2023, Tony Isaac, a member of the Company's board of directors exercised stock options for which he received 9,904 shares of the Company's common stock, which was repurchased by the Company (see Note 13).
Removed
Our Series B Preferred Stock is entitled to receive a dividend in the aggregate amount of $1.00 to be allocated on a pro rata basis among all of the then-issued and outstanding shares of such Series, if, when, and as our Board of Directors shall have declared it.
Added
Securities Authorized for Issuance under Equity Compensation Plans See “Item 11 – Executive Compensation – Executive Compensation Plan Information.” Recent Sales of Unregistered Securities None. ITEM 6. [Reserved] 30 Table of Contents
Removed
The Board of Directors shall not declare, pay or set aside any dividends on shares of any other class or series of capital stock of our Company unless that $1.00 dividend has been declared and paid. Presently, we do not pay dividends on shares of our common stock or shares of our Series B Preferred Stock.
Removed
Period Number of Shares Average Purchase Price Paid Number of Share Purchases as Part of a Publicly Announced Plan or Program Maximum Amount that May be Purchased Under the Announced Plan or Program Balance Forward as of September 2020 383,035 7.52 383,035 7,150,845 October 2020 16,489 10.51 16,489 6,969,189 November 2020 11,029 11.27 11,029 6,842,649 December 2020 6,408 11.49 6,408 6,768,059 April 2021 1,009 24.92 1,009 6,742,651 August 2021 500 24.98 500 6,729,997 January 2022 8,420 24.70 8,420 6,520,120 February 2022 31,021 29.83 31,021 5,561,677 March 2022 26,227 34.73 26,227 4,646,772 May 2022 9,602 34.13 9,602 4,316,652 June 2022 4,558 24.94 4,558 4,201,907 July 2022 1,800 24.86 1,800 4,156,713 August 2022 711 25.00 711 4,138,725 September 2022 4,112 24.96 4,112 4,034,751 Totals 504,921 504,921 Securities Authorized for Issuance under Equity Compensation Plans See “Item 11 – Executive Compensation – Executive Compensation Plan Information.” Recent Sales of Unregistered Securities None.
Removed
ITEM 6. Selec ted Financial Data Not applicable. 30

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

2 edited+0 added−0 removed0 unchanged
Biggest changeFinancial Statements and Supplementary Data 41 Reports of Independent Registered Public Accounting Firms F- 1 Consolidated Financial Statements: Consolidated Balance Sheets at September 30, 2022 and 2021 F- 3 Consolidated Statements of Income for the Years Ended September 30, 2022 and 2021 F- 4 Consolidated Statements of Stockholders' Equity for the Years Ended September 30, 2022 and 2021 F- 5 Consolidated Statements of Cash Flows for the Years Ended September 30, 2022 and 2021 F- 6 Notes to Consolidated Financial Statements F- 8
Biggest changeFinancial Statements and Supplementary Data 40 Reports of Independent Registered Public Accounting Firms F- 1 Consolidated Financial Statements: Consolidated Balance Sheets at September 30, 202 3 and 202 2 F- 3 Consolidated Statements of ( Loss) Income for the Years Ended September 30, 202 3 and 202 2 F- 4 Consolidated Statements of Stockholders' Equity for the Years Ended September 30, 202 3 and 202 2 F- 5 Consolidated Statements of Cash Flows for the Years Ended September 30, 202 3 and 202 2 F- 6 Notes to Consolidated Financial Statements F- 8
Item 6. Selected Financial Data 30 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 31 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 40 Item 8.
Item 6. [Reserved] 30 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 31 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 39 Item 8.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

54 edited+23 added−25 removed8 unchanged
Biggest changeAs companies often define non-GAAP financial measures differently, Adjusted EBITDA, as calculated by Live Ventures Incorporated, should not be compared to any similarly titled measures reported by other companies 33 Results of Operations The following table sets forth certain statement of income items and as a percentage of revenue, for the periods indicated (in $000’s): Year Ended Year Ended September 30, 2022 September 30, 2021 Selected Data: Revenues $ 286,913 $ 272,981 Cost of revenues 189,086 173,518 General and administrative expenses 54,531 52,246 Sales and marketing expenses 12,459 11,427 Impairment expense 4,910 — Interest expense, net 4,209 5,205 Provision for income taxes 6,875 8,662 Net income $ 24,741 $ 31,017 Adjusted EBITDA (a) Retail business $ 14,054 $ 18,173 Flooring Manufacturing business 17,043 23,744 Steel Manufacturing business 10,230 6,615 Corporate and Other (2,943 ) (4,009 ) Total Adjusted EBITDA $ 38,384 $ 44,523 Adjusted EBITDA as a percentage of revenue Retail business 16.3 % 20.5 % Flooring Manufacturing business 13.0 % 18.2 % Steel Manufacturing business 16.9 % 13.4 % Corporate and Other -31.7 % -86.9 % Consolidated adjusted EBITDA as a percentage of revenue 13.4 % 16.3 % The following table sets forth revenues by segment (in $000’s): Year Ended Year Ended September 30, 2022 September 30, 2021 Net % of Total Net % of Total Revenue Revenue Revenue Total Revenue Revenues Retail $ 86,156 30.0 % $ 88,845 32.5 % Flooring manufacturing 130,850 45.6 % 130,223 47.7 % Steel manufacturing 60,617 21.1 % 49,302 18.1 % Corporate and other 9,290 3.2 % 4,611 1.7 % Total Revenue $ 286,913 100.0 % $ 272,981 100.0 % 34 The following table sets forth gross profit and gross profit as a percentage of total revenue by segment (in $000’s): Year Ended Year Ended September 30, 2022 September 30, 2021 Gross Gross Profit % Gross Gross Profit % Profit of Total Revenue Profit of Total Revenue Gross Profit Retail $ 45,583 15.9 % $ 48,059 17.6 % Flooring manufacturing 31,908 11.1 % 37,893 13.9 % Steel manufacturing 16,878 5.9 % 11,954 4.4 % Corporate and other 3,458 1.2 % 1,557 0.6 % Total Gross Profit $ 97,827 34.1 % $ 99,463 36.4 % Revenues Revenues increased by approximately $13.9 million to approximately $286.9 million for the year ended September 30, 2022 as compared to the year ended September 30, 2021 of approximately $273.0 million.
Biggest changeResults of Operations The following table sets forth certain statement of income items and as a percentage of revenue, for the periods indicated (in $000’s): Year Ended September 30, 2023 Year Ended September 30, 2022 % of Total Revenue % of Total Revenue Selected Data Revenue $ 355,171 $ 286,913 Cost of revenue 239,605 67.5 % 189,086 65.9 % General and administrative expenses 86,670 24.4 % 54,531 19.0 % Sales and marketing expenses 13,447 3.8 % 12,459 4.3 % Impairment expense — — % 4,910 1.7 % Interest expense, net 12,741 3.6 % 4,209 1.5 % Provision for income taxes 1,571 0.4 % 6,875 2.4 % Net (loss) income $ (102) — % $ 24,741 8.6 % Adjusted EBITDA (a) Retail - Entertainment $ 10,581 $ 14,054 Retail - Flooring 3,321 — Flooring Manufacturing 10,100 17,043 Steel Manufacturing 12,210 10,230 Corporate and other (4,674) (2,943) Total adjusted EBITDA $ 31,538 $ 38,384 Adjusted EBITDA as a percentage of revenue Retail - Entertainment 13.5 % 16.3 % Retail - Flooring 4.4 % NA Flooring Manufacturing 9.2 % 13.0 % Steel Manufacturing 13.7 % 16.9 % Corporate and other NA NA Consolidated adjusted EBITDA as a percentage of revenue 8.9 % 13.4 % 33 Table of Contents The following table sets forth revenues by segment (in $000’s): Year Ended September 30, 2023 Year Ended September 30, 2022 Net Revenue % of Total Revenue Net Revenue % of Total Revenue Revenue Retail - Entertainment $ 78,124 22.0 % $ 86,156 30.0 % Retail - Flooring 75,872 21.4 % — — % Flooring Manufacturing 109,770 30.9 % 130,850 45.6 % Steel Manufacturing 88,912 25.0 % 60,617 21.1 % Corporate and other 2,493 0.7 % 9,290 3.2 % Total revenue $ 355,171 100.0 % $ 286,913 100.0 % The following table sets forth gross profit and gross profit as a percentage of total revenue by segment (in $000’s): Year Ended September 30, 2023 Year Ended September 30, 2022 Gross Profit Gross Profit % of Total Revenue Gross Profit Gross Profit % of Total Revenue Gross Profit Retail - Entertainment $ 42,751 37.0 % $ 45,583 46.6 % Retail - Flooring 27,769 24.0 % — — % Flooring Manufacturing 23,891 20.7 % 31,908 32.6 % Steel Manufacturing 20,023 17.3 % 16,878 17.3 % Corporate and other 1,132 1.0 % 3,458 3.5 % Total revenue $ 115,566 100.0 % $ 97,827 100.0 % Critical Accounting Policies Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
With over 5,000 distinct size grade combinations in stock every day, Precision Marshall arms tool steel distributors with deep inventory availability and same day shipment to their place of business or often ships direct to their customer saving time and handling. On June 28, 2022, Precision Marshall acquired Kinetic.
With over 5,000 distinct size grade combinations in stock every day, Precision Marshall arms tool steel distributors with deep inventory availability and same day shipment to their place of business or often ships direct to their customer saving time and handling. Kinetic On June 28, 2022, Precision Marshall acquired Kinetic.
Management’s Discussion and Analysis of Financial Condition and Results of Operations For a description of our significant accounting policies and an understanding of the significant factors that influenced our performance during the year ended September 30, 2022, this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (hereafter referred to as “MD&A”) should be read in conjunction with the consolidated financial statements, including the related notes, appearing in Part II, Item 8 of this Annual Report on Form 10-K for the fiscal year ended September 30, 2022 (this “Form 10-K”).
Management’s Discussion and Analysis of Financial Condition and Results of Operations For a description of our significant accounting policies and an understanding of the significant factors that influenced our performance during the year ended September 30, 2023, this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (hereafter referred to as “MD&A”) should be read in conjunction with the consolidated financial statements, including the related notes, appearing in Part II, Item 8 of this Annual Report on Form 10-K for the fiscal year ended September 30, 2023 (this “Form 10-K”).
Cash Flows from Investing Activities Our cash flows used in investing activities of approximately $40.0 million for the year ended September 30, 2022 consisted primarily of purchases of property and equipment and our acquisitions of Kinetic and Better Backers.
Our cash flows used in investing activities of approximately $40.0 million for the year ended September 30, 2022 consisted primarily of purchases of property and equipment and our acquisitions of Kinetic and Better Backers.
It is, however, a measurement that the Company believes is useful to investors in analyzing its operating performance. Accordingly, Adjusted EBITDA should be considered in addition to, but not as a substitute for, net income, cash flow provided by operating activities, and other measures of financial performance prepared in accordance with GAAP. Adjusted EBITDA is a non-GAAP financial measure.
It is, however, a measurement that the Company believes is useful to investors in analyzing its operating performance. Accordingly, Adjusted EBITDA should be considered in addition to, but not as a substitute for, net income, cash flow provided by operating activities, and other measures of financial performance prepared in accordance with GAAP.
The amount, nature and timing of any borrowings or sales of debt or equity securities will depend on our operating performance and other circumstances; our then-current commitments and obligations; the amount, nature and timing of our capital requirements; any limitations imposed by our current credit arrangements; and overall market conditions.
The amount, nature and timing of any borrowings or sales of debt or equity securities will depend on our 37 Table of Contents operating performance and other circumstances; our then-current commitments and obligations; the amount, nature and timing of our capital requirements; any limitations imposed by our current credit arrangements; and overall market conditions.
Some accounting policies have a significant and material impact on amounts reported in these financial statements. Estimates and assumptions are based on management's experience and other information available prior to the issuance of our financial statements. Our actual realized results may differ materially from management’s initial estimates as reported.
Preparation of these statements requires us to make judgments and estimates. Some accounting policies have a significant and material impact on amounts reported in these financial statements. Estimates and assumptions are based on management's experience and other information available prior to the issuance of our financial statements. Our actual realized results may differ materially from management’s initial estimates as reported.
Kinetic is a highly recognizable and regarded brand name in the production of industrial knives and hardened wear products for the tissue, metals, and wood industries and is known as a one-stop shop for in-house grinding, machining, and heat-treating. Kinetic was founded by the Masters family in 1948 and is headquartered in Greendale, Wisconsin.
Kinetic is a highly recognizable and regarded brand name in the production of industrial knives and hardened wear products for the tissue, metals, and wood industries and is known as a one-stop shop for in-house grinding, machining, and heat-treating. Kinetic is headquartered in Greendale, Wisconsin.
Adjusted EBITDA We evaluate the performance of our operations based on financial measures such as revenue and “Adjusted EBITDA.” Adjusted EBITDA is defined as net income (loss) before interest expense, interest income, income taxes, depreciation, amortization, stock-based compensation, and other non-cash or nonrecurring charges.
Adjusted EBITDA We evaluate the performance of our operations based on financial measures such as “Adjusted EBITDA,” which is a non-GAAP financial measure. We define Adjusted EBITDA as net income (loss) before interest expense, interest income, income taxes, depreciation, amortization, stock-based compensation, and other non-cash or nonrecurring charges.
Cash Flows from Financing Activities Our cash flows provided by financing activities of approximately $25.4 million for the year ended September 30, 2022 primarily consisted in net proceeds from revolver loans of approximately $21.6 million, and approximately $17.0 million in proceeds from the issuance of notes payable, partially offset by payments on notes payable and finance leases of approximately $10.6 million, and purchases of treasury stock of approximately $2.7 million.
Our cash flows provided by financing activities of approximately $33.6 million for the year ended September 30, 2022 primarily consisted in net proceeds from revolver loans of approximately $21.6 million, approximately $17.0 million in proceeds from the issuance of notes payable, and proceeds from a failed sales and leaseback transaction of approximately $8.2 million, partially offset by payments on notes payable and finance leases of approximately $10.6 million, and purchases of treasury stock of approximately $2.7 million.
Adjusted EBITDA is also a measure that is customarily used by financial analysts to evaluate a company’s financial performance, subject to certain adjustments.
Adjusted EBITDA is also a measure that is customarily used by financial analysts to evaluate a 32 Table of Contents company’s financial performance, subject to certain adjustments.
Precision Marshall has led the industry with exemplary availability and value-added processing that saves distributors time and processing costs. Founded in 1948, Precision Marshall “The Deluxe Company” has built a reputation of high integrity, speed of service and doing things the “Deluxe Way”.
For over 75 years, Precision Marshall has served steel distributors through quick and accurate service. Precision Marshall has led the industry with exemplary availability and value-added processing that saves distributors time and processing costs. Founded in 1948, Precision Marshall “The Deluxe Company” has built a reputation of high integrity, speed of service and doing things the “Deluxe Way”.
Vintage Stock Vintage Stock Holdings LLC, Vintage Stock, V-Stock, Movie Trading Company and EntertainMart (collectively, “Vintage Stock”) is an award-winning specialty entertainment retailer that offers a large selection of entertainment products, including new and pre-owned movies, video games and music products, as well as ancillary products, such as books, comics, toys and collectibles, in a single location.
Vintage Stock is an award-winning specialty entertainment retailer that offers a large selection of entertainment products, including new and pre-owned movies, video games and music products, as well as ancillary products, such as books, comics, toys and collectibles, in a single location.
With its integrated buy-sell-trade business model, Vintage Stock buys, sells and trades new and pre-owned movies, music, video games, electronics and collectibles through 68 retail locations strategically positioned across Arkansas, Colorado, Idaho, Illinois, Kansas, Missouri, Nebraska, New Mexico, Oklahoma, Texas, and Utah.
With its integrated buy-sell-trade business model, Vintage Stock buys, sells and trades new and pre-owned movies, music, video games, electronics and collectibles through 70 retail locations strategically positioned across Arkansas, Colorado, Idaho, Illinois, Kansas, Missouri, Nebraska, New Mexico, Oklahoma, Texas, and Utah. Retail-Flooring Segment Our Retail-Flooring Segment is composed of Flooring Liquidators, Inc. (“Flooring Liquidators”).
Provision (Benefit) for Income Taxes For the year ended September 30, 2022, the Company recorded an income tax provision of approximately $6.9 million, compared to a tax provision of approximately $8.7 million for the year ended September 30, 2021.
Provision for Income Taxes For the year ended September 30, 2023, the Company recorded a provision for income tax of approximately $1.6 million, compared to a provision for income tax of approximately $6.9 million for the year ended September 30, 2022.
Cash Flows from Operating Activities The Company’s cash and restricted cash at September 30, 2022 was approximately $4.6 million compared to approximately $4.7 million at September 30, 2021, a decrease of approximately $100,000.
Cash Flows from Operating Activities The Company’s cash at September 30, 2023 was approximately $4.3 million compared to approximately $4.6 million at September 30, 2022, a decrease of approximately $300,000.
Additionally, we have an unsecured revolving line of credit with Isaac Capital Group (“ICG Revolver”), a related party, which is utilized by the Company. 38 As of September 30, 2022, we had total cash and restricted cash of approximately $4.6 million as well as approximately $26.4 million of available borrowing under our revolving credit facilities.
Additionally, we have an unsecured revolving line of credit with Isaac Capital Group (“ICG Revolver”), a related party, which is utilized by the Company. As of September 30, 2023, we had total cash availability of approximately $37.1 million, comprised of approximately $4.3 million in cash, as well as approximately $32.8 million of available borrowing under our revolving credit facilities.
Cost of revenue as a percentage of revenue was 75.7% for the year ended September 30, 2022, as opposed to 70.9% for the year ended September 30, 2021. The increase is primarily due to increases in raw material costs, as compared to the prior year.
Cost of revenue as a percentage of revenue was 78.2% for the year ended September 30, 2023, as opposed to 75.6% for the year ended September 30, 2022, and was primarily due to increases in raw material costs, as compared to the prior year.
We have the following three asset-based revolver lines of credit: (i) Texas Capital Bank Revolver Loan (“TCB Revolver”) utilized by Vintage Stock, (ii) Bank of America Revolver Loan (“BofA Revolver”) utilized by Marquis, and (iii) Fifth Third Revolver Loan (“Fifth Third Revolver”) utilized by Precision Marshall.
We have the following five asset-based revolver lines of credit: (i) Texas Capital Bank Revolver Loan (“TCB Revolver”) utilized by Vintage Stock, (ii) Bank of America Revolver Loan (“BofA Revolver”) utilized by Marquis, (iii) two Fifth Third Bank Revolver Loans (“Fifth Third Revolvers”), one utilized by Precision Marshall and the other by PMW, and (iv) Eclipse Business Capital Revolver Loan (“Eclipse Revolver”) utilized by Flooring Liquidators.
Cost of Revenues Cost of revenues increased by approximately $15.6 million, or 9.0% for the year ended September 30, 2022 as compared to the year ended September 30, 2021. Cost of revenue as a percentage of revenues was 65.9% for the year ended September 30, 2022, as compared to 63.6% for the year ended September 30, 2021.
Cost of Revenue Cost of revenue increased by approximately $50.5 million, or 26.7% for the year ended September 30, 2023 as compared to the year ended September 30, 2022. Cost of revenue as a percentage of revenues was 67.5% for the year ended September 30, 2023, as compared to 65.9% for the year ended September 30, 2022.
Our principal offices are located at 325 E. Warm Springs Road, Suite 102, Las Vegas, Nevada 89119, our telephone number is (702) 939-0231, and our corporate website (which does not form part of this report Form 10-K) is located at www.liveventures.com.
Warm Springs Road, Suite 102, Las Vegas, Nevada 89119, our telephone number is (702) 939-0231, and our corporate website (which does not form part of this report Form 10-K) is located at www.liveventures.com. Our common stock trades on the Nasdaq Capital Market under the symbol “LIVE”.
Marquis is a leading carpet manufacturer and distributor of carpet and hard-surface flooring products. Over the last decade, Marquis has been an innovator and leader in the value-oriented polyester carpet sector, which is currently the market’s fastest-growing fiber category. Marquis focuses on the residential, niche commercial, and hospitality end-markets and serves thousands of customers.
Over the last decade, Marquis has been an innovator and leader in the value-oriented polyester carpet sector, which is currently the market’s fastest-growing fiber category. Marquis focuses on the residential, niche commercial, and hospitality end-markets and serves thousands of customers. Since commencing operations in 1995, Marquis has built a strong reputation for outstanding value, styling, and customer service.
Proceeds from borrowings under revolver loans and the issuance of notes payable was primarily associated with the acquisition of Kinetic.
Proceeds from borrowings under revolver loans, the issuance of notes payable and related party notes payable was primarily associated with the acquisitions of Flooring Liquidators and PMW.
Any financing obtained may further dilute or otherwise impair the ownership interest of our existing stockholders.
Other sources of financing may include stock issuances and additional loans; or other forms of financing. Any financing obtained may further dilute or otherwise impair the ownership interest of our existing stockholders.
Adjusted EBITDA Reconciliation The following tables present a reconciliation of Adjusted EBITDA from net income for the years ended September 30, 2022 and 2021 (in $000’s): Year Ended September 30, 2022 September 30, 2021 Net income $ 24,741 $ 31,017 Depreciation and amortization 7,168 6,791 Stock-based compensation 37 489 Interest expense, net 4,209 5,205 Income tax expense 6,875 8,662 Gain on bankruptcy settlement (11,352 ) (1,765 ) Gain/loss on extinguishment of debt 84 (6,150 ) Non-recurring loan costs — 274 Acquisition costs 1,470 — Write-off of fixed assets 438 — Impairment of goodwill and intangibles 4,910 — Other non-recurring noncash items (196 ) — Adjusted EBITDA $ 38,384 $ 44,523 Adjusted EBITDA decreased by approximately $6.1 million, or 13.8%, for the year ended September 30, 2022, as compared to the prior year period.
Adjusted EBITDA Reconciliation The following table presents a reconciliation of Adjusted EBITDA to net income, its nearest GAAP measure, for the years ended September 30, 2023 and 2022 (in $000’s): For the Year Ended September 30, 2023 2022 Net (loss) income $ (102) $ 24,741 Depreciation and amortization 14,257 7,168 Stock-based compensation 446 37 Interest expense, net 12,741 4,209 Income tax expense 1,571 6,875 Gain on bankruptcy settlement — (11,352) Loss on extinguishment of debt — 84 SW Financial settlement gain (2,750) — Disposition of SW Financial 1,697 — Acquisition costs 3,554 1,470 Write-off of fixed assets — 438 Impairment of goodwill and intangibles — 4,910 Other non-recurring company initiatives 124 (196) Adjusted EBITDA $ 31,538 $ 38,384 Adjusted EBITDA decreased by approximately $6.8 million, or 17.8%, for the year ended September 30, 2023, as compared to the prior year period.
(“Precision Marshall”), and its wholly-owned subsidiary The Kinetic Co., Inc. (“Kinetic”) . 32 Precision Marshall is the North American leader in providing and manufacturing, pre-finished de-carb free tool and die steel. For nearly 75 years, Precision Marshall has served steel distributors through quick and accurate service.
Steel Manufacturing Segment Our Steel Manufacturing segment is comprised of Precision Industries, Inc. (“Precision Marshall”), its wholly-owned subsidiary The Kinetic Co., Inc. (“Kinetic”), and Precision Metal Works, Inc. (“PMW”) . Precision Marshall Precision Marshall is the North American leader in providing and manufacturing, pre-finished de-carb free tool and die steel.
Our primary sources of cash inflows are from customer receipts from sales on account, factored accounts receivable proceeds, receipts for securities sales commissions, and net remittances from directory services customers processed in the form of ACH billings.
The reclassification decreased fiscal year 2022 cash generated from operating activities from $14.6 million as previously reported to $6.4 million as adjusted. Our primary sources of cash inflows are from customer receipts from sales on account, factored accounts receivable proceeds, and net remittances from directory services customers processed in the form of ACH billings.
Gain on Bankruptcy Settlement During the year ended September 30, 2022, we recorded a gain of approximately $11.4 million due to the discharge of certain obligations relating to the ApplianceSmart bankruptcy as discussed above. During the year ended September 30, 2021, the Company recorded a gain of approximately $1.8 million due to the discharge of certain payables from bankruptcy proceedings.
Gain on Bankruptcy Settlement During the year ended September 30, 2022, we recorded a gain of approximately $11.4 million due to the discharge of certain obligations relating to the ApplianceSmart bankruptcy. No similar gains or losses were recognized during the year ended September 30, 2023.
Cost of revenue as a percentage of revenue was 47.1% for the year ended September 30, 2022, as opposed to 45.9% for the year ended September 30, 2021. This increase is due to inflationary pressures and product mix.
Cost of revenue as a percentage of revenue was 45.3% for the year ended September 30, 2023, as opposed to 47.1% for the year ended September 30, 2022. This decrease was primarily due to a higher percentage of used product sales, which generate higher margins.
Our cash flows used in investing activities of approximately $17.4 million for the year ended September 30, 2021 consisted of purchases of property and equipment and our investment in SW Financial.
Cash Flows from Investing Activities Our cash flows used in investing activities of approximately $64.0 million for the year ended September 30, 2023 consisted primarily of purchases of property and equipment and our acquisitions of Flooring Liquidators, PMW, and Cal Coast Carpets.
Contractual Obligations The following table summarizes our contractual obligations consisting of operating lease agreements and debt obligations and the effect such obligations are expected to have on our future liquidity and cash flows (in $000's): Payments due by Period Less Than One Year One to Three Years Three to Five Years More Than Five Years Total Notes payable $ 18,935 $ 18,075 $ 35,609 $ 9,646 $ 82,265 Notes Payable - related party 2,000 2,000 — — 4,000 Lease obligations 11,998 19,385 14,001 91,435 136,819 Total $ 32,933 $ 39,460 $ 49,610 $ 101,081 $ 223,084 Off-Balance Sheet Arrangements At September 30, 2022, we had no off-balance sheet arrangements, commitments or guarantees that require additional disclosure or measurement.
Contractual Obligations The following table summarizes our contractual obligations consisting of debt obligations and lease agreements and the effect such obligations are expected to have on our future liquidity and cash flows (in $000's): Payments due by Period Less Than One Year One to Three Years Three to Five Years More Than Five Years Total Notes payable $ 23,077 $ 34,275 $ 34,017 $ 10,418 $ 101,787 Notes payable - related party 4,000 2,000 4,914 — 10,914 Seller notes - related party — 500 38,498 — 38,998 Lease obligations 18,984 31,864 22,846 134,998 208,692 Total $ 46,061 $ 68,639 $ 100,275 $ 145,416 $ 360,391 Off-Balance Sheet Arrangements At September 30, 2023, we had no off-balance sheet arrangements, commitments or guarantees that require additional disclosure or measurement.
Steel Manufacturing Segment Revenue for the year ended September 30, 2022 increased by approximately $11.3 million, or 23%, as compared to the prior year, due to increased sales prices resulting from passing on product cost increases to customers, as well as the acquisition of Kinetic during June 2022.
Steel Manufacturing Segment Revenue for the year ended September 30, 2023 increased by approximately $28.3 million, or 46.7%, as compared to the prior year, primarily due to the acquisitions of Kinetic during June 2022 and PMW during July 2023.
General and administrative expenses increased by approximately $1.9 million, or 33.9%, primarily due to an increase in 37 compensation costs, as well as the acquisition of Kinetic. Operating income was approximately $9.0 million and approximately $5.9 million, for the years ended September 30, 2022 and 2021, respectively.
General and administrative expenses increased by approximately $4.0 million, or 54.4%, primarily due to the acquisitions of Kinetic and PMW, partially offset by reduced compensation expense at Precision Marshall. Operating income was approximately $8.0 million and $9.0 million, for the years ended September 30, 2023 and 2022, respectively.
Corporate and Other revenue increased by approximately $4.7 million, or 101.5%, to approximately $9.3 million for the year ended September 30, 2022, as compared to approximately $4.6 million for the year ended September 30, 2021. The increase is due to the addition of SW Financial as a VIE during June 2021.
Corporate and Other revenue decreased by approximately $6.8 million, or 73.2%, to approximately $2.5 million for the year ended September 30, 2023, as compared to approximately $9.3 million for the year ended September 30, 2022. The decrease was primarily due to the shutdown and deconsolidation of SW Financial in May 2023.
Net cash provided by operations was approximately $14.6 million for the year ended September 30, 2022, as compared to net cash provided by operations of approximately $29.2 million for the same period in 2021. The decrease is primarily due to purchases of inventory and the timing of payments of income taxes and trade accounts payable.
Net cash provided by operations was approximately $26.0 million for the year ended September 30, 2023, as compared to net cash provided by operations of approximately $6.4 million for the same period in 2022.
Our critical and significant accounting policies include Trade and Other Receivables, Inventories, Goodwill, Revenue Recognition, Fair Value Measurements, Stock Based Compensation, Income Taxes, Segment Reporting and Concentrations of Credit Risk.
Our critical and significant accounting policies include Trade and Other Receivables, Inventories, Goodwill, Revenue Recognition, Fair Value Measurements, Income Taxes, Segment Reporting and Concentrations of Credit Risk. Revenue Revenue increased by approximately $68.3 million to approximately $355.2 million for the year ended September 30, 2023 as compared to approximately $286.9 million for the year ended September 30, 2022.
General and administrative expenses increased by approximately $1.2 million, and is primarily attributable to inflationary cost pressures and new stores opened in fiscal year 2022. Operating income for the year ended September 30, 2022 was approximately $12.6 million, as compared to approximately $16.3 million during the prior year period primarily due to those factors discussed above.
Operating income for the year ended September 30, 2023 was approximately $6.1 million, as compared to operating income of approximately $14.2 million for the prior year period primarily due to those factors discussed above.
Revenues and operating income for our directory services business continue to decline due to decreasing renewals. We expect revenue and operating income from this segment to continue to decrease in the future. We are no longer accepting new customers in our directory services business.
Operating loss for the year ended September 30, 2023 was approximately $7.6 million, as compared to a loss of approximately $9.7 million in the prior year. Revenues and operating income for our legacy directory services business continue to decline due to decreasing renewals. We expect revenue and operating income from this segment to continue to decrease in the future.
Currently, the Company is not issuing common shares for liquidity purposes. We prefer to use asset-based lending arrangements and mezzanine financing together with Company provided capital to finance acquisitions and have done so historically. Occasionally, as our Company history has demonstrated, we will issue stock and derivative instruments linked to stock for services and/or debt settlement.
Proceeds from borrowings under revolver loans and the issuance of notes payable was primarily associated with the acquisition of Kinetic. Currently, the Company is not issuing common shares for liquidity purposes. We prefer to use asset-based lending arrangements and mezzanine financing together with Company provided capital to finance acquisitions and have done so historically.
Interest Expense, net Interest expense, net decreased by approximately $1.0 million or 19.1%, for the year ended September 30, 2022 as compared to the year ended September 30, 2021.
Flooring Manufacturing revenue decreased by approximately $21.1 million, or 16.1%, to approximately $109.8 million for the year ended September 30, 2023, as compared to approximately $130.9 million for the year ended September 30, 2022.
The year over year decrease is primarily due to a bankruptcy gain exclusion, in the amount of $2.8 million, applicable to the gain recorded in connection with the ApplianceSmart bankruptcy. 36 Results of Operations by Segment The following table sets forth the results of operations by segment (in $000’s): Year Ended September 30, 2022 Year Ended September 30, 2021 Flooring Steel Corporate & Flooring Steel Corporate & Retail Manufacturing Manufacturing Other Total Retail Manufacturing Manufacturing Other Total Revenues $ 86,156 $ 130,850 $ 60,617 $ 9,290 $ 286,913 $ 88,845 $ 130,223 $ 49,302 $ 4,611 $ 272,981 Cost of Revenue 40,573 98,942 43,739 5,832 189,086 40,786 92,330 37,348 3,054 173,518 Gross Profit 45,583 31,908 16,878 3,458 97,827 48,059 37,893 11,954 1,557 99,463 General and Administrative Expense 32,312 6,522 7,444 8,253 54,531 31,131 7,614 5,558 7,943 52,246 Selling and Marketing Expense 643 11,232 568 16 12,459 588 10,076 527 236 11,427 Impairment Expense — — — 4,910 4,910 — — — — — Operating Income (Loss) $ 12,628 $ 14,154 $ 8,866 $ (9,721 ) $ 25,927 $ 16,340 $ 20,203 $ 5,869 $ (6,622 ) $ 35,790 Retail Segment Revenue for the year ended September 30, 2022 decreased by approximately $2.7 million, or 3.0%, as compared to the prior year, primarily due to reduced demand partially offset by price increases as a result of inflationary factors and supply chain issues, offset by increased retail pricing and additional locations added at Vintage Stock.
The year over year decrease is primarily due to a decrease in net income due to overall reduced customer demand as a result of general economic conditions. 35 Table of Contents Results of Operations by Segment The following table sets forth the results of operations by segment (in $000’s): For the Year Ended Sep 30, 2023 For the Year Ended Sep 30, 2022 Retail-Entertainment Retail-Flooring Flooring Manufacturing Steel Manufacturing Corporate & Other Total Retail-Entertainment Retail-Flooring Flooring Manufacturing Steel Manufacturing Corporate & Other Total Revenue $ 78,124 $ 75,872 $ 109,770 $ 88,912 $ 2,493 $ 355,171 $ 86,156 $ — $ 130,850 $ 60,617 $ 9,290 $ 286,913 Cost of Revenue 35,373 48,103 85,879 68,889 1,361 239,605 40,573 — 98,942 43,739 5,832 189,086 Gross Profit 42,751 27,769 23,891 20,023 1,132 115,566 45,583 — 31,908 16,878 3,458 97,827 General and Administrative Expense 32,751 27,640 6,330 11,490 8,459 86,670 32,312 — 6,522 7,444 8,253 54,531 Selling and Marketing Expense 735 421 11,500 555 236 13,447 643 — 11,232 568 16 12,459 Impairment Expense — — — — — — — — — — 4,910 4,910 Operating Income (Loss) $ 9,265 $ (292) $ 6,061 $ 7,978 $ (7,563) $ 15,449 $ 12,628 $ — $ 14,154 $ 8,866 $ (9,721) $ 25,927 Retail-Entertainment Segment Revenue for the year ended September 30, 2023 decreased by approximately $8.0 million, or 9.3%, as compared to the prior year, primarily due to a deterioration in economic conditions.
Our cash flows used in financing activities of approximately $16.1 million for the year ended September 30, 2021 primarily consisted of approximately $16.8 million for payments of notes payable, approximately $1.4 million in net payments under revolver loans, and approximately $421,000 for the purchase of treasury stock, partially offset by the issuance of notes payable of approximately of $2.3 million from proceeds received from the issuance of notes payable, and proceeds of approximately $323,000 from stock options exercised.
Cash Flows from Financing Activities Our cash flows provided by financing activities of approximately $37.6 million for the year ended September 30, 2023 primarily consisted of approximately $15.8 million in proceeds from the issuance of notes payable, net proceeds from revolver loans of approximately $13.7 million, proceeds from failed sales and leaseback transactions of $12.7 million, and proceeds from the issuance of related party debt of $7.0 million, partially offset by payments on notes payable and finance leases of approximately $10.5 million, and purchases of treasury stock of approximately $1.0 million.
Sales and marketing expenses increased by approximately $1.2 million primarily due to increased convention and trade show activity, as well as increased compensation associated with the Marquis sales force. Operating income for the year ended September 30, 2022 was approximately $14.0 million, as compared to operating income of approximately $20.2 million for the prior year period.
Selling and Marketing Expense Selling and marketing expense increased by approximately $1.0 million for the year ended September 30, 2023 as compared to the year ended September 30, 2022 primarily due to convention and trade show activity in our Flooring Manufacturing segment and Retail-Flooring segment due to the acquisition of Flooring Liquidators.
We currently have three segments to our business: Retail, Flooring Manufacturing, Steel Manufacturing, and Corporate & Other. Under the Live Ventures brand, we seek opportunities to acquire profitable and well-managed companies. We work closely with consultants who help us identify target companies that fit within the criteria we have established for opportunities that will provide synergies with our businesses.
We work closely with consultants who help us identify target companies that fit within the criteria we have established for opportunities that will provide synergies with our businesses. Our principal offices are located at 325 E.
The increase is primarily due to the net assets received from the acquisitions of Kinetic and Better Backers, increases in accounts receivable and inventories, and decreases in debtor-in-possession 39 liabilities and accrued liabilities, partially offset by increases in the current portion of long-term debt and the current portion of operating lease obligations.
The increase is primarily due to the net assets received from the acquisitions of Flooring Liquidators and PMW, increases in accounts receivable and inventories, partially offset by increases in accounts payable, accrued liabilities, the current portion of long-term debt and the current portion of operating lease obligations. 38 Table of Contents Future Sources of Cash; New Products and Services We may require additional debt financing or capital to finance new acquisitions, refinance existing indebtedness or other strategic investments in our business.
Our Company Live Ventures Incorporated is a holding company of diversified businesses, which, together with our subsidiaries, we refer to as the “Company”, “Live Ventures”, “we”, “us” or “our”. We acquire and operate companies in various industries that have historically demonstrated a strong history of earnings power.
The following discussion includes forward-looking statements. Please refer to the Forward-Looking Statements section of this Form 10-K for important information about these types of statements. Our Company Live Ventures Incorporated is a holding company of diversified businesses, which, together with our subsidiaries, we refer to as the “Company”, “Live Ventures”, “we”, “us” or “our”.
The decrease is primarily due to decreases in revenue and gross profit, as discussed above.
The decrease was primarily due to an overall decrease in operating income, as discussed above.
Steel Manufacturing revenue increased by approximately $11.3 million, or 23.0%, to approximately $60.6 million for the year ended September 30, 2022, as compared to approximately $49.3 million for the year ended September 30, 2021.
The decrease was due to reduced customer demand as a result of general economic conditions. 34 Table of Contents Steel Manufacturing revenue increased by approximately $28.3 million, or 46.7%, to approximately $88.9 million for the year ended September 30, 2023, as compared to approximately $60.6 million for the year ended September 30, 2022.
Cost of revenue as a percentage of revenue was 72.2% for the year ended September 30, 2022, as opposed to 75.8% for the year ended September 30, 2021. The decrease is due to improved manufacturing efficiencies, increased revenue due to price increases, and the acquisition of Kinetic.
Cost of revenue as a percentage of revenue was 77.5% for the year ended September 30, 2023, as opposed to 72.2% for the year ended September 30, 2022. The increase was primarily due to the acquisition of PMW, which has historically generated lower margins.
Retail segment revenue decreased by approximately $2.7 million, or 3.0%, to approximately $86.2 million for the year ended September 30, 2022, as compared to $88.8 million for the year ended September 30, 2021.
Retail-Entertainment segment revenue decreased by approximately $8.0 million, or 9.3%, to approximately $78.1 million for the year ended September 30, 2023, as compared to $86.2 million for the year ended September 30, 2022, and was primarily due to reduced demand caused by a deterioration in economic conditions. Our Retail-Flooring segment consists of Flooring Liquidators, which we acquired in January 2023.
Since commencing operations in 1995, Marquis has built a strong reputation for outstanding value, styling, and customer service. Its innovation has yielded products and technologies that differentiate its brands in the flooring marketplace. Marquis’s state-of-the-art operations enable high quality products, unique customization, and exceptionally short lead-times.
Its innovation has yielded products and technologies that differentiate its brands in the flooring marketplace. 31 Table of Contents Marquis’s state-of-the-art operations enable high quality products, unique customization, and short lead-times. Furthermore, the Company has recently invested in additional capacity to grow several attractive lines of business, including printed carpet and yarn extrusion.
Cost of revenue for the year ended September 30, 2022 increased proportionately with revenue due to inflationary pressures and the consolidation of SW Financial in June 2021. Operating loss for the year ended September 30, 2022 was approximately $9.7 million, as compared to a loss of approximately $6.6 million in the prior year.
Revenue for the year ended September 30, 2023 was approximately $75.9 million, and cost of revenue as a percentage of revenue was 63.%. Operating loss for the year ended September 30, 2023 was approximately $290,000.
Corporate and Other Segment Results for Corporate and Other includes our directory services business and our investment in SW Financial. Revenues for the year ended September 30, 2022 increased by approximately $4.7 million primarily due to the addition of SW Financial as a VIE during June 2021.
Corporate and Other Segment Revenues for the year ended September 30, 2023 decreased by approximately $6.8 million. The decrease was primarily due to the shutdown and deconsolidation of SW Financial in May 2023. Cost of revenue was 54.6% for the year ended 36 Table of Contents September 30, 2023, as opposed to 62.8% for the year ended September 30, 2022.
Working Capital We had working capital of approximately $78.4 million as of September 30, 2022 as compared to approximately $33.8 million as of September 30, 2021.
Occasionally, as our Company history has demonstrated, we will issue stock and derivative instruments linked to stock for services and/or debt settlement. Working Capital We had working capital of approximately $85.0 million as of September 30, 2023 as compared to approximately $78.4 million as of September 30, 2022.
Removed
Note about Forward-Looking Statements This Form 10-K includes statements that constitute “forward-looking statements.” These forward-looking statements are often characterized by the terms “may,” “believes,” “projects,” “intends,” “plans,” “expects,” or “anticipates,” and do not reflect historical facts.
Added
We acquire and operate companies in various industries that have historically demonstrated a strong history of earnings power. We currently have five segments to our business: Retail-Entertainment, Retail-Flooring, Flooring Manufacturing, Steel Manufacturing, and Corporate & Other. Under the Live Ventures brand, we seek opportunities to acquire profitable and well-managed companies.
Removed
Specific forward-looking statements contained in this portion of the Annual Report include, but are not limited to: (i) statements that are based on current projections and expectations about the markets in which we operate, (ii) statements about current projections and expectations of general economic conditions, (iii) statements about specific industry projections and expectations of economic activity, (iv) statements relating to our future operations, prospects, results, and performance, (v) statements about the Chapter 11 Case, (vi) statements that the cash on hand and additional cash generated from operations together with potential sources of cash through issuance of debt or equity will provide the Company with sufficient liquidity for the next 12 months, and (vii) statements that the outcome of pending legal proceedings will not have a material adverse effect on business, financial position and results of operations, cash flow or liquidity.
Added
Retail-Entertainment Segment Our Retail-Entertainment Segment is composed of Vintage Stock, Inc., doing business as Vintage Stock, V-Stock, Movie Trading Company and EntertainMart (collectively, “Vintage Stock”).
Removed
Forward-looking statements involve risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. This Form 10-K identifies those factors and risks that could affect our results, our future performance, and our capital requirements under Item 1A “Risk Factors”.
Added
Flooring Liquidators is a leading retailer and installer of flooring, carpeting, and countertops to consumers, builders, and contractors in California and Nevada, operating 19 warehouse-format stores and design centers. Over the years, the company has established a strong reputation for innovation, efficiency and service in the home renovation and improvement market.
Removed
There are also other factors that we are currently unable to identify or quantify, but that may exist in the future, that could similarly affect us. In addition, any or all of the factors identified in this Form 10-K may generally affect our business, results of operations, and financial position.
Added
Flooring Liquidators serves retail and builder customers through two businesses: retail customers through its Flooring Liquidators retail stores, and builder and contractor customers through Elite Builder Services, Inc. Flooring Manufacturing Segment Our Flooring Manufacturing segment is comprised of Marquis Industries, Inc. (“Marquis”). Marquis is a leading carpet manufacturer and distributor of carpet and hard-surface flooring products.
Removed
Forward-looking statements speak only as of the date the statements were made. We do not undertake and specifically decline any obligation to update any forward-looking statements. Any information contained on our website, www.liveventures.com, or any other websites referenced in this Annual Report, are not part of this Annual Report.
Added
On July 1, 2022, Marquis acquired certain assets and intellectual property related to the carpet-backing operations of Better Backers, a Georgia corporation. On September 20, 2023, Marquis acquired the Harris Flooring Group® brands from Q.E.P., a designer, manufacturer, and distributor of a broad range of best-in-class flooring and installation solutions for commercial and home improvement projects.
Removed
Our common stock trades on the Nasdaq Capital Market under the symbol “LIVE”. 31 Retail Segment Our Retail Segment is composed of Vintage Stock and ApplianceSmart.
Added
Kinetic manufactures more than 90 types of knives and numerous associated parts with modifications and customizations available to each. Kinetic employs approximately 100 non-union employees. PMW On July 20, 2023, Precision Marshall acquired PMW. Founded nearly 76 years ago in 1947 in Louisville, Kentucky, PMW manufactures and supplies highly engineered parts and components across 400,000 square feet of manufacturing space.
Removed
ApplianceSmart ApplianceSmart is a household appliance retailer with two product categories: one consisting of typical and commonly available, innovative appliances, and the other consisting of affordable value-priced, offerings such as close-outs, factory overruns, discontinued models, and special-buy appliances, including open box merchandise and others.
Added
PMW offers world-class metal forming, assembly, and finishing solutions across diverse industries, including appliance, automotive, hardware, electrical, electronic, medical products, and devices.
Removed
On December 9, 2019, ApplianceSmart filed a voluntary petition (the “Chapter 11 Case”) in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) seeking relief under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”).
Added
Corporate and Other Segment Our Corporate and Other segment consists of certain corporate general and administrative costs, Salomon Whitney LLC, which was shut down during the three months ended June 30, 2023, and operations of certain legacy products and service offerings for which we are no longer accepting new customers.
Removed
The bankruptcy affected Live Ventures’ indirect subsidiary ApplianceSmart only and did not affect any other subsidiary of Live Ventures, or Live Ventures itself.
Added
As companies often define non-GAAP financial measures differently, Adjusted EBITDA, as calculated by the Company, should not be compared to any similarly titled measures reported by other companies. A reconciliation of net income, the closest GAAP measure, to Adjusted EBITDA is provided below.
Removed
On February 28, 2022, the court approved ApplianceSmart’s plan for reorganization (the “Plan”), discharging ApplianceSmart of certain debts according to the Plan resulting in the Company recording a gain of approximately $11.4 million, which includes a write-off or adjustment of approximately $11.5 million on the settlement of debts and other liabilities, offset by payments subject to the bankruptcy that were not included as debtor-in-possession liabilities of approximately $149,000.
Added
Revenue for the year ended September 30, 2023 was approximately $75.9 million. During the year ended September 30, 2023, Flooring Liquidators acquired certain assets of Cal Coast Carpet Warehouse, Inc.
Removed
As of April 1, 2022, we have ceased operations of its one existing location, and are in the process of winding down operations, which will be immaterial to the consolidated financial statements. Flooring Manufacturing Segment Our Flooring Manufacturing segment is comprised of Marquis. Marquis Affiliated Holdings LLC and wholly-owned subsidiaries (“Marquis”).
Added
The increase is primarily due to the acquisitions of Kinetic during June 2022 and PMW during July 2023, partially offset by a decrease of $6.4 million from Precision Marshall. The decrease by Precision Marshall was due to reduced customer demand as a result of general economic conditions.
Removed
Furthermore, the Company has recently invested in additional capacity to grow several attractive lines of business, including printed carpet and yarn extrusion. On July 1, 2022, Live acquired certain assets and intellectual property of Better Backers, a Georgia corporation, which was accomplished through an Asset Purchase Agreement. Steel Manufacturing Segment Our Steel Manufacturing segment is comprised of Precision Industries, Inc.
Added
The increase was primarily attributable to inflationary cost increases, as well as the acquisition of PMW, which historically has generated lower margins, partially offset by the acquisition of Flooring Liquidators, which historically has generated higher margins.
Removed
Kinetic manufactures more than 90 types of knives and numerous associated parts with modifications and customizations available to each. Kinetic employs approximately 100 non-union employees. Critical Accounting Policies Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Preparation of these statements requires us to make judgments and estimates.
Added
General and Administrative Expense General and administrative expense increased by approximately $32.1 million or 58.9%, for the year ended September 30, 2023 as compared to the year ended September 30, 2022, primarily due to the acquisitions of Kinetic in June 2022, Flooring Liquidators in January 2023, and PMW in July 2023, which collectively contributed $33.8 million of general and administrative expense.

… 22 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed0 unchanged
Biggest changeWe believe we are not subject in any material way to other forms of market risk, such as foreign currency exchange risk or foreign customer purchases or commodity price risk. 40
Biggest changeWe believe we are not subject in any material way to other forms of market risk, such as foreign currency exchange risk or foreign customer purchases or commodity price risk. 39 Table of Contents
ITEM 7A. Quantitative and Quali tative Disclosures about Market Risk As of September 30, 2022, we did not participate in any market risk-sensitive commodity instruments for which fair value disclosure would be required.
ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk As of September 30, 2023, we did not participate in any market risk-sensitive commodity instruments for which fair value disclosure would be required.

Other LIVE 10-K year-over-year comparisons