Company: FRHC
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0000924805-25-000041
Chunk: 323

Company: Freedom Holding Corp.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 8
Chunk 323
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 ended September 30, 2025, total expenses, net in our insurance segment increased mainly due to $46.2 million increase in insurance claims incurred, net of reinsurance due to claims paid in the class of  compulsory motor third-party liability (MTPL), a $8.1 million increase in stock compensation expense due to new stock grants, a $4.0 million increase in provisions for credit loses primarily driven by higher premium receivables, reflecting growth in written premiums during the period, a $2.3 million increase in payroll and bonuses expense due to the increase in headcount. The increase was partially offset by a $31.7 million decrease in fee and commission expense, a $8.7 million decrease in general and administrative expense, and a $1.8 million decrease in interest expense due to repurchase agreement obligations as a result of changes in securities portfolio.

              Other Segment

•In the six months ended September 30, 2025, the increase in our Other segment's total expenses, net was driven by an increase in payroll and bonuses, interest expense, cost of sales, advertising and sponsorship expense, general and administrative expense, and professional services. There was a $22.6 million increase in payroll and bonuses and $10.0 million in general and administrative expense in our Other segment which was mostly attributable to the overall growth of our operations as well as the addition of new subsidiaries. Cost of sales increased by $19.5 million due to a higher sales volume, which reflects our expansion into the telecommunications sector as well as increased customer activity and order volume at Arbuz. Interest expense increased by $20.3 million, mainly attributable to an increase in interest expense from the debt securities issued by Freedom SPC. Additionally, our 

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advertising and sponsorship expense increased by $4.8 million due to expanded marketing expenditures to third party contractors at Freedom Advertising and Aviata and several sponsorship contributions made through our subsidiaries. Stock compensation expense increased by $6.5 million, which is attributable to new stock grants awarded and the partial amortization of stock grants which were awarded during 2025 and 2024 fiscal years.

LIQUIDITY AND CAPITAL RESOURCES

During the periods covered in this quarterly report, our operations were primarily funded through a combination of existing cash on hand, cash generated from operations, returns generated from our proprietary trading and proceeds from the sale of bonds and other borrowings.

We regularly monitor and manage our leverage and liquidity risk through various committees and processes we have established to maintain