Company: HGBL
Filing Date: 2025-03-13
Form Type: 10-K
Source: 0000950170-25-038691
Chunk: 58

Company: Heritage Global Inc.
Filing Date: 2025-03-13
Form: 10-K
Item: Item 1
Chunk 58
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    Heritage GlobalPartners, Inc.(California) (2)
     
    Heritage Global LLC(Delaware) (3)
     
    National LoanExchange, Inc.(Illinois) (5)
     
    Heritage Global Capital LLC(Delaware) (6)

    100%

    Heritage ALTLLC(Delaware) (4)

(1)Registrant.

(2)Auction and Liquidation.

(3)Holding Company.

(4)Refurbishment & Resale.

(5)Brokerage.

(6)Specialty Lending.

Employees

As of December 31, 2024, we had 86 total and full-time employees, broken down by segment as follows: 34 are employed by HGP, 19 by NLEX, 22 by ALT, 5 by HGC and 6 by HG.

Industry and Competition

Our business consists primarily of the auction, appraisal, refurbishment and asset advisory services provided by our Industrial Assets division and the charged-off receivable brokerage and specialty financing services provided by our Financial Assets division, each of which is further described below. Our business also includes the purchase and sale, including at auction, of industrial machinery and equipment, real estate, inventories, charged-off receivable and distressed debt. The market for all of these services and assets is highly fragmented. To acquire auction or appraisal contracts, or assets for resale, we compete with other liquidators, auction companies, dealers and brokers. We also compete with them for potential purchasers and lenders. Some competitors have significantly greater financial and marketing resources and name recognition.

We believe that our business is positioned to grow in all economic cycles. As the economy encounters situations of recession, flattening yield curves and rising credit costs, our business may experience wider margins on principal asset sales, a favorable lending cycle for charged-off and nonperforming asset portfolios, higher volumes of nonperforming assets and building surplus inventories and bankruptcies. In times of economic growth, our business has demonstrated its ability to experience growth based on our competitive advantages in the industry, including our domain expertise related to deal sourcing and execution capabilities, our diversification of integrated service platforms and our experience across underserved markets. We intend to continue to leverage our competitive advantages to grow within each segment and across platforms through increasing synergies, maintaining high incremental margins, improving earnings predictability, strengthening financial metrics reflected on our balance sheet and managing expenses.

Our business strategy in the Specialty Lending and Auction and Liquidation segments includes the option of partnering with one