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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): November 12, 2024

 

SHF Holdings, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

(State or other jurisdiction of incorporation)

 

001-40524   86-2409612

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

1526 Cole Blvd., Suite 250

Golden, Colorado 80401

(Address of principal executive offices) (Zip Code)

 

Registrant’s telephone number, including area code (303) 431-3435

 

 

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
     
  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
     
  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
     
  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class   Trading Symbol(s)   Name of Each Exchange on Which Registered
Class A Common Stock, $0.0001 par value per share   SHFS   The Nasdaq Stock Market LLC
Redeemable Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share   SHFSW   The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

 

 

 

Item 2.02.

Results of Operations and Financial Condition.

 

On October 30, 2024, SHF Holdings, Inc. (the “Company”) issued a press release announcing that management would discuss its earnings and other financial results for the second quarter ended September 30, 2024 in a webcast conference call at 4:30 pm Eastern time on November 12, 2024 following the release of the Company’s financial results. On November 12, 2024 in conjunction with the release of the Company’s third quarter results, the Company issued its third quarter 2024 earnings release. The November 12, 2024 earnings release is attached as Exhibit 99.1.

 

Exhibit 99.1 is being furnished and will not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934 as amended (the “Exchange Act”), or otherwise be subject to the liabilities of that section, nor will it be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act.

 

Item 9.01.Financial Statements and Exhibits.

 

Exhibit No.   Description of Exhibit
99.1   Press Release dated November 12, 2024
104   Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit)

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  SHF HOLDINGS, INC.
     
Date: November 12, 2024 By: /s/ James Dennedy
    Chief Financial Officer

 

 

 

 

Exhibit 99.1

 

Safe Harbor Financial Reports Financial Results for Third Quarter and Nine Months Ended September 30, 2024

 

—Net Income increased to $0.4 million in the third quarter of 2024

 

—Loan Interest Income increased 48% and 143.5% year-over-year for three and nine months ended September 30, 2024, respectively

 

—Operating Expenses decreased 13% versus Q3 2023 and by 66.4% for the nine-month period in 2024

 

GOLDEN, Colo., November 12, 2024 — SHF Holdings, Inc., d/b/a/ Safe Harbor Financial (“Safe Harbor” or the “Company”) (NASDAQ: SHFS), a leader in facilitating financial services and credit facilities to the regulated cannabis industry, announced today its financial results for the third quarter and nine months ended September 30, 2024.

 

Third Quarter 2024 Financial and Operational Summary

 

Net Income increased to approximately $0.4 million, compared to a net loss of approximately $0.7 million in the same period of 2023;

 

Revenue was approximately $3.5 million, compared to approximately $4.3 million for the third quarter of 2023;

 

Operating Expenses decreased to $3.3 million, compared to $3.8 million in the third quarter of 2023;

 

Loan Interest Income increased 48.0% from approximately $900,000 in the third quarter of 2023 to approximately $1.3 million in the third quarter of 2024;

 

Adjusted EBITDA(1) decreased 27.4% to approximately $0.76 million, compared to approximately $1.1 million for the third quarter of 2023(1).

 

Nine-month 2024 Financial & Operational Summary

 

Net Income increased to approximately $3.3 million, compared to a net loss of approximately $19.8 million in the first nine months of 2023;

 

Revenue was approximately $11.6 million, compared to approximately $13.1 million for the first nine months of 2023;

 

Operating Expenses decreased to approximately $10.8 million, compared to approximately $32.1 million in the first nine months of 2023;

 

Loan Interest Income increased 143.5% from approximately $1.9 million in the first nine months of 2023 to approximately $4.8 million in the first nine months of 2024;

 

Adjusted EBITDA(1) increased 22.1% to approximately $2.8 million, compared to approximately $2.3 million for the first nine months of 2023(1).

 

(1) Adjusted EBITDA is a non-GAAP financial metric. A reconciliation of non-GAAP to GAAP measures is included below in this earnings release.

 

 
 

 

“Throughout the third quarter of 2024, Safe Harbor Financial continued to make meaningful progress on our strategic priorities focused on innovation, operational excellence, and client service,” said Sundie Seefried, Chief Executive Officer of Safe Harbor Financial. “During the third quarter of 2024, we delivered strong loan interest income growth of 48% and improved net income by approximately 147%, year-over-year. We accomplished this while remaining intensely disciplined in expense management, resulting in a 13% decrease in operating expenses, compared to the same period last year.

 

“Subsequent to the quarter end, the Company originated an initial $1.07 million secured credit facility with a multi-state operator, representing the first tranche of a $5 million commitment, further solidifying our role as a trusted financial partner. Our recent executive team restructuring, contract extensions and ongoing expense management all underscore our commitment to long-term growth and shareholder value. While the current regulatory environment remains highly challenging for cannabis related business, we are confident that Safe Harbor is well-positioned to capitalize on the significant opportunities that lie ahead.”

 

Third Quarter 2024 Operational Highlights

 

 On July 9, 2024, the Company announced it successfully exited a $3.1 million loan in default, collecting 100% of principal, as well as over $200,000 in accrued interest.

 

 On July 25, 2024, Safe Harbor announced it was teaming up with BIPOCann to empower minority-owned cannabis businesses.

 

 On September 4, 2024, the Company announced it had secured key executive team members with strategic contract extensions.

 

Subsequent Operational Highlights

 

 On October 29, 2024, Safe Harbor announced it had originated a $1.07 million secured credit facility for a Missouri cannabis operator.

 

Third Quarter 2024 Financial Results

 

For the third quarter ended September 30, 2024, total revenue was $3.5 million, compared to $4.3 million in the prior year period. The decrease in revenue was due to a reduction in deposit, activity and onboarding income, which was primarily attributable to a decrease in the number of accounts related to the Abaca acquisition. In the three months ended September 30, 2024, PCCU accounted for $1,354,036 of the revenue generated from deposits, activities and client onboarding. Related to this revenue, the Company recognized $131,002 in account hosting expenses, in accordance with the PCCU CAA. In the three months ended September 30, 2023, PCCU contributed $1,287,669 to the revenue from similar sources, with account hosting expenses amounting to $54,729 as per the Loan Servicing Agreement provisions.

 

 
 

 

Operating expenses for the third quarter 2024 decreased to approximately $3.3 million, compared to approximately $3.8 million in the prior year period, which was comprised of the following:

 

 Compensation and employee benefits decreased in the three months ended September 30, 2024, compared to the three months ended September 30, 2023, as a result of stock-based compensation and the decrease in the headcount.

 

 Rent expenses decreased in the three months ended September 30, 2024, compared to the three months ended September 30, 2023, due to a reduction in the number of lease properties.

 

 (Benefit)/ Provision for credit losses increased in the three months ended September 30, 2024, compared to the three months ended September 30, 2023, due to an increase in loan portfolio amount.

 

 For the three months ended September 30, 2024, general and administrative expenses decreased across various categories including: i) approximately $177,069 in investment hosting fees due to a reduction in investment income, and (ii) approximately $128,014 in amortization and depreciation due to a reduction in the gross value of intangible assets from impairment recorded in 2023.

 

Third quarter 2024 net income was approximately $0.35 million, compared to a net loss of approximately $748,000 in the prior year period. The improvement in net income in the third quarter of 2024 was the result of lower expenses across the Company and a greater number of performing loans at better interest rates than the prior year period.

 

First Nine Months 2024 Financial Results

 

For the nine-months ended September 30, 2024, total revenue was $11.6 million, compared to approximately $13.1 million in the prior year period. The decrease in revenue for the first nine months of 2024 was due to a reduction in deposit activity and onboarding income and was primarily attributable to a decrease in the number of accounts related to the Abaca acquisition. In the nine months ended September 30, 2024, PCCU accounted for $3,778,633 of the revenue generated from deposits, activities and client onboarding. Related to this revenue, the Company recognized $356,369 in account hosting expenses, in accordance with the CAA. For the nine months ended September 30, 2023, PCCU contributed $4,051,353 to the revenue from similar sources, with account hosting expenses amounting to $170,987 as per the Loan Servicing Agreement provisions.

 

First nine-months of 2024 operating expenses decreased to $10.8 million, compared to $32.1 million in the prior year period, which was comprised of the following:

 

 Compensation and employee benefits decreased in the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, as a result of stock-based compensation and also related to a reduction in force.

 

 Rent expenses decreased in the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, due to reduction in the number of lease properties.

 

 (Benefit)/ Provision for credit losses increased in the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, due to an increase in loan portfolio amount.

 

 For the nine months ended September 30, 2024, general and administrative expenses decreased across various categories including: i) approximately $ 604,080 in investment hosting fees due to a reduction in investment income, and ii) approximately $535,179 in amortization and depreciation due to the reduction in the gross value of intangible assets from impairment recorded in 2023.

 

Net income for the first nine-months of 2024 was approximately $3.3 million, compared to a net loss of approximately $19.8 million in the prior year period. The driver of net income produced in the first nine months of 2024 was lower expenses across the Company and a greater number of performing loans at better interest rates than the prior year period.

 

As of September 30, 2024, the Company had cash and cash equivalents of $5.9 million, compared to $4.9 million at December 31, 2023.

 

For more information on the Company’s third quarter 2024 financial results, please refer to our Form 10-Q for the quarter ended September 30, 2024 filed with the U.S. Securities & Exchange Commission (the “SEC”) and accessible at www.sec.gov.

 

 
 

 

SHF Holdings, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   September 30, 2024   December 31, 2023 
   (Unaudited)     
ASSETS          
Current Assets:          
Cash and cash equivalents  $5,861,475   $4,888,769 
Accounts receivable – trade   237,757    121,875 
Accounts receivable – related party   966,643    2,095,320 
Prepaid expenses – current portion   492,375    546,437 
Accrued interest receivable   15,601    13,780 
Forward purchase receivable   4,584,221    - 
Short-term loans receivable, net   13,091    12,391 
Other current assets   -    82,657 
Total Current Assets  $12,171,163   $7,761,229 
Long-term loans receivable, net   374,429    381,463 
Property, plant and equipment, net   5,151    84,220 
Operating lease right to use assets   742,609    859,861 
Goodwill   6,058,000    6,058,000 
Intangible assets, net   3,249,459    3,721,745 
Deferred tax asset   43,802,927    43,829,019 
Prepaid expenses – long term position   450,000    562,500 
Forward purchase receivable   -    4,584,221 
Security deposit   19,333    18,651 
Total Assets  $66,873,071   $67,860,909 
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current Liabilities:          
Accounts payable  $125,281   $217,392 
Accounts payable-related party   106,593    577,315 
Accrued expenses   788,052    1,008,987 
Contract liabilities   47,565    21,922 
Lease liabilities – current   159,408    132,546 
Senior secured promissory note – current portion   3,105,906    3,006,991 
Deferred consideration – current portion   2,984,533    2,889,792 
Forward purchase derivative liability   7,309,580    - 
Other current liabilities   64,686    41,639 
Total Current Liabilities  $14,691,604   $7,896,584 
Warrant liabilities   1,408,084    4,164,129 
Deferred consideration – long term portion   388,000    810,000 
Forward purchase derivative liability   -    7,309,580 
Senior secured promissory note—long term portion   8,662,724    11,004,175 
Net deferred indemnified loan origination fees   390,739    63,275 
Lease liabilities – long term   753,800    875,447 
Indemnity liability   1,225,660    1,382,408 
Total Liabilities  $27,520,611   $33,505,598 
Commitment and Contingencies (Note 13)          
Stockholders’ Equity          
Convertible preferred stock, $.0001 par value, 1,250,000 shares authorized, 111 and 1,101 shares issued and outstanding on September 30, 2024, and December 31, 2023, respectively   -    - 
Class A common stock, $.0001 par value, 130,000,000 shares authorized, 55,673,327 and 54,563,372 issued and outstanding on September 30, 2024, and December 31, 2023, respectively   5,569    5,458 
Additional paid in capital   108,437,941    105,919,674 
Retained deficit   (69,091,050)   (71,569,821)
Total Stockholders’ Equity  $39,352,460   $34,355,311 
Total Liabilities and Stockholders’ Equity  $66,873,071   $67,860,909 

 

 
 

 

SHF Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

   For the three months ended
September 30,
   For the nine months ended
September 30,
 
   2024   2023   2024   2023 
                 
Revenue  $3,482,630   $4,332,974   $11,570,964   $13,085,861 
                     
Operating Expenses                    
Compensation and employee benefits  $1,839,244   $2,069,910   $6,384,213   $8,269,761 
General and administrative expenses   929,406    1,482,792    2,915,390    4,874,255 
Impairment of goodwill   -    -    -    13,208,276 
Impairment of finite-lived intangible assets   -    -    -    3,680,463 
Professional services   463,452    361,804    1,428,129    1,431,785 
Rent expense   66,170    87,951    199,805    246,694 
Provision (benefit) for credit losses   7,449    (200,932)   (158,586)   377,614 
Total operating expenses  $3,305,721   $3,801,525   $10,768,951   $32,088,848 
Operating income/ (loss)  $176,909   $531,449   $802,013   $(19,002,987)
Other income /(expenses)                    
Change in the fair value of deferred consideration   (68,811)   (197,307)   327,259    (581,315)
Interest expense   (161,716)   (159,533)   (484,718)   (963,464)
Change in fair value of warrant liabilities   414,272    (860,735)   2,756,045    (417,798)
Total other income/ (expenses)  $183,745   $(1,217,575)  $2,598,586   $(1,962,577)
Net income/ (loss) before income tax   360,654    (686,126)   3,400,599    (20,965,564)
Income tax benefit/ (expense), net   (6,837)   (61,941)   (55,579)   1,199,483 
Net income/ (loss)  $353,817   $(748,067)  $3,345,020   $(19,766,081)
Weighted average shares outstanding, basic   55,501,354    49,257,988    55,382,066    38,725,273 
Basic net income/ (loss) per share  $0.01   $(0.02)  $0.06   $(0.51)
Weighted average shares outstanding, diluted   56,550,287    49,257,988    56,430,999    38,725,273 
Diluted income / (loss) per share  $0.01   $(0.02)  $0.06   $(0.51)

 

 
 

 

SHF Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

 

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024

 

   Preferred Stock   Class A
Common Stock
   Additional
Paid-in
   Retained   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
Balance, June 30, 2024   111         -    55,431,001   $5,545   $107,900,303   $(69,444,867)  $   38,460,981 
Issuance of equity for marketing services   -    -    242,326    24    149,976    -    150,000 
Restricted stock units (net of tax)   -    -    -    -    33,127    -    33,127 
Stock compensation cost   -    -    -    -    354,535    -    354,535 
Net income   -    -    -    -    -    353,817    353,817 
Balance, September 30, 2024   111    -    55,673,327   $5,569   $108,437,941   $(69,091,050)  $39,352,460 

 

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2023

 

   Preferred Stock   Class A
Common Stock
   Additional
Paid-in
   Retained   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
Balance, June 30, 2023   4,221   $    -    46,265,317   $4,627   $97,923,103   $(70,577,990)  $   27,349,740 
Conversion of PIPE shares   (410)   -    328,000    33    358,717    (358,750)   - 
Stock option conversion   -    -    -    -    388,559    -    388,559 
Restricted stock units   -    -    -    -    33,735    -    33,735 
Net loss   -    -    -    -    -    (748,067)   (748,067)
Balance, September 30, 2023   3,811   $-    46,593,317   $4,660   $98,704,114   $(71,684,807)  $27,023,967 

 

 
 

 

SHF Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

 

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024

 

   Preferred Stock   Class A
Common Stock
   Additional
Paid-in
   Retained   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
Balance, December 31, 2023   1,101   $          -    54,563,372   $5,458   $105,919,674   $(71,569,821)  $   34,355,311 
Conversion of PIPE shares   (990)   -    792,000    79    866,170    (866,249)   - 
Issuance of equity for marketing services   -    -    242,326    24    149,976    -    150,000 
Restricted stock units (net of tax)   -    -    75,629    8    54,280    -    54,288 
Stock compensation cost   -    -    -    -    1,447,841    -    1,447,841 
Net Income   -    -    -    -    -    3,345,020    3,345,020 
Balance, September 30, 2024   111    -    55,673,327    5,569    108,437,941    (69,091,050)   39,352,460 

 

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023

 

   Preferred Stock   Class A
Common Stock
   Additional
Paid-in
   Retained   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Capital   Deficit   Equity 
Balance, December 31, 2022   14,616   $      1    23,732,889   $2,374   $44,806,031   $(39,695,281)  $      5,113,125 
Cumulative effect from adoption of CECL   -    -    -    -    -    (581,321)   (581,321)
Conversion of PIPE shares   (10,805)   (1)   10,394,200    1,039    11,641,086    (11,642,124)   - 
Stock option conversion   -    -    -    -    1,707,763    -    1,707,763 
Restricted stock units   -    -    1,266,228    127    1,243,446    -    1,243,573 
Reversal of deferred underwriting cost   -    -    -    -    900,500    -    900,500 
Issuance of shares to PCCU (net of tax)   -    -    11,200,000    1,120    38,405,288    -    38,406,408 
Net loss   -    -    -    -    -    (19,766,081)   (19,766,081)
Balance, September 30, 2023   3,811   $-    46,593,317   $4,660   $98,704,114    (71,684,807)  $27,023,967 

 

 
 

 

SHF Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

   For the nine months ended
September 30,
 
   2024   2023 
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net income/ (loss)  $3,345,020   $(19,766,081)
Adjustments to reconcile net income/ (loss) to net cash provided by/ (used in) operating activities:          
Depreciation and amortization expense   551,356    1,086,535 
Marketing expense settled via equity   25,000    - 
Stock compensation expense (net of RSU tax adjustment)   1,502,129    2,951,336 
Amortization of net deferred indemnified loan origination fees   (75,135)   - 
Interest expense   -    963,464 
(Benefit)/ provision for credit losses   (158,586)   377,614 
Lease expense   22,467    110,273 
Impairment of goodwill   -    13,208,276 
Impairment of finite-lived intangible assets   -    3,680,463 
Deferred tax expense/(benefit), net   36,562    (1,199,483)
Change in the fair value of deferred consideration   (327,259)   581,315 
Change in fair value of warrant   (2,756,045)   417,798 
Changes in operating assets and liabilities:          
Accounts receivable – trade   (115,882)   10,858 
Accounts receivable – related party   1,128,677    78,079 
Contract assets   -    19,055 
Prepaid expenses   291,562    84,478 
Accrued interest receivable   (1,824)   (83,017)
Deferred underwriting payable   -    (550,000)
Other current assets   82,657    150,817 
Other current liabilities   12,574    61,621 
Accounts payable   (92,114)   (1,874,633)
Accounts payable – related party   (470,722)   (43,105)
Accrued expenses   (220,930)   (552,395)
Contract liabilities   25,643    62,406 
Net deferred indemnified loan origination fees   402,601    - 
Security deposit   (682)   (706)
Net cash provided by (used in) operating activities   3,207,069    (225,032)
CASH FLOWS PROVIDED BY INVESTING ACTIVITIES:          
Purchase of property and equipment   -    (208,434)
Net repayment of loans   8,173    991,914 
Net cash provided by investing activities   8,173    783,480 
CASH FLOWS USED IN FINANCING ACTIVITIES:          
Repayment of senior secured promissory note   (2,242,536)   - 
Net cash used in financing activities   (2,242,536)   - 
           
Net increase in cash and cash equivalents   972,706    558,449 
Cash and cash equivalents – beginning of period   4,888,769    8,390,195 
Cash and cash equivalents – end of period  $5,861,475   $8,948,644 
Supplemental disclosure of cash flow information          
Interest paid  $416,852   $- 
Non-Cash transactions:          
Marketing expense settled via common stock  $125,000   $- 
Shares issued for the settlement of PCCU debt obligation   -    38,406,408 
Cumulative effect from adoption of CECL   -    581,321 
Interest payment on senior secured promissory note   -    260,007 
Reversal of deferred underwriting cost   -    900,500 

 

 
 

 

Reconciliation of Net income (loss) to non-GAAP EBITDA and Adjusted EBITDA

(Unaudited)

 

Safe Harbor Financial discloses EBITDA and Adjusted EBITDA, both of which are non-GAAP financial measures and are calculated as net income before taxes and depreciation and amortization expense in the case of EBITDA and further adjusted to exclude non-cash, unusual and/or infrequent costs in the case of Adjusted EBITDA. Management of the Company uses this information in evaluating period over period performance because it believes that EBITDA and Adjusted EBITDA present important metrics regarding the Company’s ongoing operating performance. Investors should consider non-GAAP financial measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.

 

A reconciliation of net income to non-GAAP EBITDA and Adjusted EBITDA is as follows:

 

  

Three Months Ended

September 30,

  

Nine Months Ended

September 30,

 
   2024   2023   2024   2023 
Net (loss)/income  $353,817   $(748,067)  $3,345,020   $(19,766,081)
Interest expense   161,716    159,533    484,718    963,464 
Depreciation and amortization   160,857    288,871    551,356    1,086,535 
Taxes   6,837    61,941    55,579    (1,199,483)
EBITDA  $683,227   $(237,722)  $4,436,673   $(18,915,565)
                     
Other adjustments –                    
(Benefit)/ Provision for credit losses   7,449    (200,932)   (158,586)   377,614 
Change in the fair value of warrants   (414,272)   860,735    (2,756,045)   417,798 
Change in the fair value of deferred consideration   68,811    197,307    (327,259)   581,315 
Stock based compensation   387,662    422,294    1,551,923    2,951,336 
Impairment of goodwill and finite-lived intangible assets   -    -    -    16,888,739 
Loan origination fees and costs   31,408    11,431    78,581    12,178 
Adjusted EBITDA  $764,285   $1,053,113   $2,825,287   $2,313,415 

 

For the three and nine months ended September 30, 2024, our EBITDA income improved primarily as a result of decrease in General and Administrative expenses. This reduction was driven by lower investment hosting fees, decreased amortization and depreciation expenses, and reduced business insurance costs. Additionally, there were decreases in compensation, employee benefits, marketing expenses, and other insurance costs. These factors contributing to our financial performance are further discussed in the “Discussion of our Results of Operations” section below. Other adjustments include estimated future credit losses not yet realized, including amounts indemnified to PCCU for loans funded by them. The Company has entered into a Commercial Alliance Agreement with PCCU (referred to as “PCCU CAA”), pursuant to which the Company agreed to indemnify PCCU for claims associated with CRB activities including any loan default related losses for loans funded by PCCU. Deferred loan origination fees and costs represent the change in net deferred loan origination fees and costs. When included with a new loan origination, we receive an upfront loan origination fee in conjunction with new loans funded by our financial institution partners and incur costs associated with originating a specific loan. For accounting purposes, the cash received for loan origination fees and costs is initially deferred and recognized as interest income utilizing the interest method.

 

Conference Call Details:

 

The Company’s Chief Executive Officer, Sundie Seefried, and Chief Financial Officer, Jim Dennedy, will host a conference call and webcast at 4:30 pm ET / 1:30 pm PT on November 12, 2024, to discuss the Company’s financial results and provide investors with key business highlights.

 

For those interested in listening in to the conference call, please dial in and ask to join the Safe Harbor Financial call.

 

  Date: Tuesday, November 12, 2024
  Time: 4:30 p.m. ET / 1:30 p.m. PT
  Live webcast and replay: https://edge.media-server.com/mmc/p/e4nodwhb
  Participant Dial-In: 646-307-1963 or 800-715-9871 (Toll Free)
  Passcode: 1606405

 

 
 

 

About Safe Harbor

 

Safe Harbor is among the first service providers to offer compliance, monitoring and validation services to financial institutions, providing traditional banking services to cannabis, hemp, CBD, and ancillary operators, making communities safer, driving growth in local economies, and fostering long-term partnerships. Safe Harbor, through its financial institution clients, implements high standards of accountability, transparency, monitoring, reporting and risk mitigation measures while meeting Bank Secrecy Act obligations in line with FinCEN guidance on cannabis-related businesses. Over the past eight years, Safe Harbor has facilitated more than $23 billion in deposit transactions for businesses with operations spanning over 41 states and US territories with regulated cannabis markets. For more information, visit www.shfinancial.org.

 

Cautionary Statement Regarding Forward-Looking Statements

 

Certain information contained in this press release may contain “forward-looking statements’’ within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included herein may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Forward-looking statements may include, but are not limited to, statements with respect to trends in the cannabis industry, including proposed changes in U.S and state laws, rules, regulations and guidance relating to Safe Harbor’s services; Safe Harbor’s growth prospects and Safe Harbor’s market size; Safe Harbor’s projected financial and operational performance, including relative to its competitors and historical performance; new product and service offerings Safe Harbor may introduce in the future; the impact volatility in the capital markets, which may adversely affect the price of Safe Harbor’s securities; the outcome of any legal proceedings that may be instituted against Safe Harbor; and other statements regarding Safe Harbor’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “outlook,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject, are subject to risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Safe Harbor’s filings with the U.S. Securities and Exchange Commission. Safe Harbor undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

 

Contact Information

 

Safe Harbor Media

Nick Callaio, Marketing Manager

720.951.0619

Nick@SHFinancial.org

 

Safe Harbor Investor Relations

ir@SHFinancial.org

 

KCSA Strategic Communications

Phil Carlson

safeharbor@kcsa.com

 

 

 

v3.24.3
Cover
Nov. 12, 2024
Document Type 8-K
Amendment Flag false
Document Period End Date Nov. 12, 2024
Entity File Number 001-40524
Entity Registrant Name SHF Holdings, Inc.
Entity Central Index Key 0001854963
Entity Tax Identification Number 86-2409612
Entity Incorporation, State or Country Code DE
Entity Address, Address Line One 1526 Cole Blvd.
Entity Address, Address Line Two Suite 250
Entity Address, City or Town Golden
Entity Address, State or Province CO
Entity Address, Postal Zip Code 80401
City Area Code 303
Local Phone Number 431-3435
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company true
Elected Not To Use the Extended Transition Period false
Class A Common Stock, $0.0001 par value per share  
Title of 12(b) Security Class A Common Stock, $0.0001 par value per share
Trading Symbol SHFS
Security Exchange Name NASDAQ
Redeemable Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share  
Title of 12(b) Security Redeemable Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share
Trading Symbol SHFSW
Security Exchange Name NASDAQ

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