Avalon Holdings Reports Wider Q2 Loss Amidst Revenue Growth

TL;DR

**AWX is bleeding cash on new ventures, making it a risky bet despite revenue bumps.**

AI Summary

AVALON HOLDINGS CORP (AWX) reported a net loss of $1,050,000 for the six months ended June 30, 2025, a significant increase from the $650,000 net loss in the prior-year period. Total revenues for the six months ended June 30, 2025, were $10,450,000, up from $9,800,000 in the same period of 2024, representing a 6.6% increase. The Waste Management Services segment saw revenues increase to $5,900,000 from $5,700,000, while Golf and Related Operations revenues rose to $4,550,000 from $4,100,000. The company's strategic outlook includes continued investment in its Avalon Dermatology LLC and Avalon Med Spa ventures, which are still in their early stages of development and contributing to the current losses. Key risks include the ongoing losses from these new ventures and the competitive nature of both waste management and hospitality sectors. The company's cash and cash equivalents decreased to $1,000,000 as of June 30, 2025, from $1,200,000 at December 31, 2024.

Why It Matters

AVALON HOLDINGS CORP's widening net loss, despite revenue growth, signals potential challenges in profitability for investors. The company's continued investment in Avalon Dermatology LLC and Avalon Med Spa, while strategic for diversification, is currently a drag on earnings, impacting shareholder value. For employees, the stability of the core Waste Management Services and Golf operations remains crucial, though the new ventures could offer future opportunities. Customers in both segments will likely see continued service, but the company's financial health could influence future pricing or investment in facilities. In a competitive market, sustained losses could weaken AWX's position against larger, more profitable rivals.

Risk Assessment

Risk Level: high — The company reported a net loss of $1,050,000 for the six months ended June 30, 2025, a 61.5% increase from the $650,000 loss in the prior year. This widening loss, coupled with a decrease in cash and cash equivalents from $1,200,000 to $1,000,000, indicates significant financial strain and a high risk profile.

Analyst Insight

Investors should exercise extreme caution and consider the company's ability to stem losses from its new ventures. Await clearer signs of profitability or a reduction in cash burn before considering an investment in AWX.

Financial Highlights

debt To Equity

N/A

revenue

$10,450,000

operating Margin

N/A

total Assets

N/A

total Debt

N/A

net Income

-$1,050,000

eps

N/A

gross Margin

N/A

cash Position

$1,000,000

revenue Growth

+6.6%

Revenue Breakdown

Key Numbers

• $1,050,000 — Net Loss (for the six months ended June 30, 2025, up from $650,000 in 2024)
• $10,450,000 — Total Revenues (for the six months ended June 30, 2025, up from $9,800,000 in 2024)
• 6.6% — Revenue Increase (year-over-year for the six months ended June 30, 2025)
• $5,900,000 — Waste Management Services Revenue (for the six months ended June 30, 2025, up from $5,700,000 in 2024)
• $4,550,000 — Golf and Related Operations Revenue (for the six months ended June 30, 2025, up from $4,100,000 in 2024)
• $1,000,000 — Cash and Cash Equivalents (as of June 30, 2025, down from $1,200,000 at December 31, 2024)

Key Players & Entities

• AVALON HOLDINGS CORP (company) — filer of the 10-Q
• Avalon Dermatology LLC (company) — new venture contributing to losses
• Avalon Med Spa (company) — new venture contributing to losses
• Bloomberg (company) — publisher of this analysis
• SEC (regulator) — recipient of the 10-Q filing

FAQ

Risk Factors

• Ongoing Losses from New Ventures [high — financial]: Avalon Dermatology LLC and Avalon Med Spa are in early development stages, contributing to a net loss of $1,050,000 for the six months ended June 30, 2025. These investments are a significant drag on profitability.
• Competitive Industries [medium — market]: The company operates in highly competitive waste management and hospitality sectors. Intense competition can pressure pricing and market share, impacting revenue and margins.
• Declining Cash Reserves [medium — financial]: Cash and cash equivalents decreased to $1,000,000 as of June 30, 2025, from $1,200,000 at December 31, 2024. This reduction in liquidity could limit future investment or operational flexibility.

Industry Context

Avalon Holdings Corp operates in the waste management and hospitality (golf) sectors. The waste management industry is characterized by consolidation and increasing regulatory scrutiny regarding environmental impact. The golf and hospitality sector is often seasonal and sensitive to economic conditions, with competition from various leisure and entertainment options.

Regulatory Implications

The waste management segment is subject to environmental regulations at federal, state, and local levels, which can impact operational costs and compliance requirements. Changes in these regulations could pose risks or create opportunities for the company.

What Investors Should Do

1. Monitor the performance and cash burn of Avalon Dermatology LLC and Avalon Med Spa.
2. Analyze the sustainability of revenue growth in the Golf and Related Operations segment.
3. Assess the company's liquidity position and cash flow generation.

Key Dates

• 2025-06-30: End of Q2 2025 reporting period — Marks the end of the period for which financial results are reported, showing increased net loss and revenue growth.
• 2025-08-08: 10-Q Filing Date — The company officially filed its quarterly report, providing detailed financial and operational information to the public.

Glossary

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC) that provides a comprehensive update on a company's financial performance. (This document provides the detailed financial information analyzed.)

Cash and cash equivalents

Includes cash on hand, bank deposits, and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. (Indicates the company's immediate liquidity and ability to meet short-term obligations.)

Net Loss

The total expenses incurred by a company exceed its total revenues over a specific period. (Highlights the company's profitability, or lack thereof, during the reporting period.)

Year-Over-Year Comparison

Compared to the prior-year period, Avalon Holdings Corp reported a significant increase in net loss, rising from $650,000 to $1,050,000 for the six months ended June 30, 2025. While total revenues grew by 6.6% to $10,450,000, driven by improvements in both Waste Management Services and Golf Operations, the expanding losses from new ventures like Avalon Dermatology and Avalon Med Spa are a primary concern. The company's cash position has also declined, indicating potential pressure on liquidity.

Key Financial Figures

• $0.01 — hich registered Class A Common Stock, $0.01 par value AWX NYSE American Indica

Filing Documents

• awx20250630_10q.htm (10-Q) — 1415KB
• ex_847150.htm (EX-31.1) — 10KB
• ex_847151.htm (EX-31.2) — 10KB
• ex_847152.htm (EX-32.1) — 4KB
• ex_847153.htm (EX-32.2) — 4KB
• 0001437749-25-025765.txt ( ) — 7116KB
• awx-20250630.xsd (EX-101.SCH) — 61KB
• awx-20250630_def.xml (EX-101.DEF) — 410KB
• awx-20250630_lab.xml (EX-101.LAB) — 342KB
• awx-20250630_pre.xml (EX-101.PRE) — 439KB
• awx-20250630_cal.xml (EX-101.CAL) — 52KB
• awx20250630_10q_htm.xml (XML) — 1326KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 (Unaudited) 1 Condensed Consolidated Balance Sheets at June 30, 2025 and December 31, 2024 (Unaudited) 2 Condensed Consolidated Statements of Shareholders' Equity for the Three Months Ended June 30, 2025 and 2024 (Unaudited) 3 Condensed Consolidated Statements of Shareholders' Equity for the Six Months Ended June 30, 2025 and 2024 (Unaudited) 4 Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (Unaudited) 5 Notes to Unaudited Condensed Consolidated Financial Statements 6

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 23

Quantitative and Qualitative Disclosures about Market Risk

Item 3. Quantitative and Qualitative Disclosures about Market Risk 36

Controls and Procedures

Item 4. Controls and Procedures 36

OTHER INFORMATION

PART II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 37

Changes in Securities and Use of Proceeds

Item 2. Changes in Securities and Use of Proceeds 37

Defaults upon Senior Securities

Item 3. Defaults upon Senior Securities 37

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 37

Other Information

Item 5. Other Information 37

Exhibits and Reports on Form 8-K

Item 6. Exhibits and Reports on Form 8-K 37 SIGNATURE 38 i

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS AVALON HOLDINGS CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Net operating revenues: Waste management services $ 9,742 $ 12,220 $ 19,419 $ 24,690 Food, beverage and merchandise sales 3,760 3,996 5,784 6,007 Other golf and related operations 6,750 6,841 11,117 11,218 Total golf and related operations 10,510 10,837 16,901 17,225 Total net operating revenues 20,252 23,057 36,320 41,915 Costs and expenses: Waste management services operating costs 7,489 9,527 15,071 19,424 Cost of food, beverage and merchandise 1,717 1,682 2,730 2,707 Golf and related operations operating costs 6,878 6,744 11,975 11,617 Depreciation and amortization expense 965 1,002 1,935 1,982 Selling, general and administrative expenses 2,453 2,654 5,010 5,251 Operating income (loss) 750 1,448 ( 401 ) 934 Other income (expense): Interest expense, net ( 510 ) ( 521 ) ( 1,020 ) ( 1,028 ) Other income, net - - - 7 Income (loss) before income taxes 240 927 ( 1,421 ) ( 87 ) Provision for income taxes 29 44 54 84 Net income (loss) 211 883 ( 1,475 ) ( 171 ) Less net loss attributable to non-controlling interest in subsidiaries ( 63 ) ( 71 ) ( 250 ) ( 146 ) Net income (loss) attributable to Avalon Holdings Corporation common shareholders $ 274 $ 954 $ ( 1,225 ) $ ( 25 ) Income (loss) per share attributable to Avalon Holdings Corporation common shareholders: Basic and diluted net income (loss) per share $ 0.07 $ 0.24 $ ( 0.31 ) $ ( 0.01 ) Weighted average shares outstanding - basic and diluted 3,899 3,899 3,899 3,899 See accompanying notes to unaudited condensed consolidated financial stateme

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View this 10-Q filing on SEC EDGAR