Annual Report for Fiscal Year Ending December 31, 2024 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the Financial Statements included in Item 8 of this report. This Item 7 contains forward-looking statements that involve risks and uncertainties. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date of this report. Actual results may differ materially from those expressed or implied in such forward-looking statements. Factors which could cause actual results to differ materially are discussed throughout this report and include, but are not limited to, those set forth at the end of this Item 7 under the heading "Cautionary Statement Regarding Forward Looking Statements." Additional factors are under the heading "Risk Factors".

Background

Certain Terms - Glossary

The following represents terms and statistics specific to our business and industry. They are used by management to evaluate and measure operations, results, productivity, and efficiency.

ACMI:	Service offering, whereby we provide outsourced cargo and passenger aircraft operating solutions, including the provision of an aircraft, crew, maintenance, and insurance, while customers assume fuel, demand and price risk. In addition, customers are generally responsible for landing, navigation and most other operational fees and costs.
Block Hour	The time interval between when an aircraft departs the terminal until it arrives at the destination terminal.
Charter	Service offering, whereby we provide cargo and passenger aircraft charter services to customers. The customer generally pays a fixed charter fee that includes fuel, insurance, landing fees, navigation fees and most other operational fees and costs.
Net Available Aircraft	The number of aircraft available each month reduced by (netted) days the aircraft is unavailable due to various maintenance events or deliveries during a month.
2Y Check	"Heavy" airframe maintenance checks, which are the most extensive in scope and are generally performed every two years and can take from 20 - 40 days to complete.
6Y Check	"Heavy" airframe maintenance checks, which are the most extensive in scope and are generally performed every six years and can take from 45 - 75 days to complete.
12Y Check	"Heavy" airframe maintenance checks, which are the most extensive in scope and are generally performed every six years and can take from 60 - 100 days to complete.
Heavy Maintenance	Scheduled maintenance activities that are extensive in scope and are primarily based on time or usage intervals, which include, but are not limited to 2Y Checks, 6Y Checks, 12Y checks and engine overhauls. In addition, unscheduled engine repairs involving the removal of the engine from the aircraft are considered to be Heavy Maintenance.
Line Maintenance	Maintenance events occurring during normal day-to-day operations.
Non-heavy Maintenance	Discrete maintenance activities for the overhaul and repair of specific aircraft components, including landing gear, auxiliary power units and engine thrust reversers.
Utilization	The average number of Block Hours operated per day per aircraft.

Business Overview

GlobalX operates a US Part 121 domestic flag and supplemental airline using the Airbus A320 family of aircraft. GlobalX's business model is to (1) provide services on an ACMI using wet lease contracts to airlines and non-airlines, and (2) on a Charter basis whereby we provide passenger aircraft charter services to customers by charging an "all-in" fee that includes fuel, insurance, landing fees, navigation fees and most other operational fees and costs. GlobalX operates within the United States, Europe, Canada, Central and South America.

Focused on becoming a market leader with differentiated, value-creating solutions

GlobalX intends to become the best-in-class U.S. narrow-body, ACMI charter airline, operating both passenger and cargo charter aircraft while recruiting and maintaining a dynamic team of customer-centric flight crews, ground and maintenance teams and management staff.

GlobalX operates its A320 family aircraft for airlines, tour operators, college and professional sports teams, incentive groups, resorts and casino groups and government agencies. It is our goal to deliver best in class on time performance and dispatch reliability, expand existing relationships and develop additional relationships with leading charter/tour operators to provide aircraft during their peak

seasons; and provide ad-hoc and track charter programs for non-airline customers, including hotels, casinos, cruise ship companies, tour operators.

Business Developments

The twelve months period ended December 31, 2024 for GlobalX was characterized by the achievement of significant regulatory milestones in addition to considerable investment in crew, staff, maintenance, and systems to build out our platform, bolster our infrastructure to prepare GlobalX to continue its rapid expansion through the delivery of additional aircraft in 2025. GlobalX is comprised of three key assets which allows us to generate income - our certifications, our aircraft, and our crew.

From a regulatory perspective GlobalX in the twelve months period ended December 31, 2024 has achieved the following:

From an aircraft perspective GlobalX in the twelve months period ended December 31, 2024 has achieved the following:

From a crew perspective GlobalX in the twelve months period ended December 31, 2024 has achieved the following:

In short, the twelve months period ended December 31, 2024 was a time when GlobalX invested in its people, prepared for its growth, and established a robust infrastructure for its future.

Reducing Operational Costs

To control costs and maintain a competitive cost per Block Hour flown, GlobalX:

Marketing Plan

GlobalX plans to achieve its revenue goals by flying charter operations for a variety of client groups:

GlobalX Aircraft Fleet

Critical to GlobalX's business model is a fleet of modern and cost-effective aircraft. To achieve this objective, GlobalX has selected what it believes is the best overall single-aisle aircraft family to operate. This approach differs from traditional airlines, which purchase a variety of aircraft, often from different manufacturers, to achieve their operational flight sectors, resulting in increased training, operating and spare part costs. GlobalX conducted research to determine the best aircraft to fly in competition with other narrow-body charter airlines in the single-aisle seat market and GlobalX selected the A320 aircraft family.

The following factors support GlobalX's choice to operate the Airbus A320 and A321 aircraft versus the Boeing family of aircraft:

Cost and Operating factors: lower fuel burn, and better aircraft and cockpit crew pool availability.

Operational Capability: the A320 has a range advantage over the 737-800 and can fly non-stop from Miami to selected airports in North America, South America, the Caribbean, and between most major destinations in Europe. The A320 has excellent maintenance dispatch reliability and strong availability of spare parts and components, making the A320, in management's estimation, the most popular aircraft among low-cost airlines.

Passenger comfort: better seat width, cargo bin volume for carry-on baggage and cargo hold volume.

Aircraft Maintenance

Heavy maintenance checks are expected to be outsourced to FAA-approved service providers. The 6Y and 12Y checks will be primarily paid for using funds from the accrued maintenance reserves paid to lessors under operating leases.

Strategy to Address Competitive Response

We expect the existing charter operators based in the U.S. to respond to GlobalX's entry into the market by lowering their pricing to customers. The expected competitive response typically includes lowered ACMI rates for key contracts. We believe GlobalX's existing relationships with potential customers and the underserved demand in the U.S., coupled with our newer planes allowing for a more cost-efficient operation, will allow us to address any competitive pressure and grow as anticipated.

GlobalX Charter Service

GlobalX is a charter provider that currently focuses exclusively on providing customized, non-scheduled passenger air transport services with narrow-body Airbus A320 and A321 aircraft. We expect our primary line of business and focus to be commercial charter services throughout North and South America and the Caribbean, with established several key customer including the US Government, scheduled airlines, US colleges and indirect air carriers.

We provide our services through two contract structures: (1) ACMI and (2) Charter.

We believe operating charter flights will largely insulate our expected profitability from fluctuations in jet fuel prices, which are typically the largest and most volatile expense for an air carrier. Under the vast majority of our commercial passenger charter arrangements, our customers bear 100% of the cost of jet fuel. In addition, consistent with industry practice, we plan for those customers to pay us our contract price approximately two weeks in advance of their flights.

Because our ACMI customers are responsible for fuel costs, our expected commercial ACMI revenues would not be affected directly by fuel price changes. However, a significant increase in fuel prices would likely have an adverse effect on demand for the use of our aircraft, which could have a material adverse effect on our profitability and financial position.

Experienced management team

Our management team has extensive operating and leadership experience in the airfreight, airline, and aircraft leasing, maintenance, and management industries at companies such as Republic Airways, JetBlue Airways, Virgin America, Hawaiian Airlines, American Airlines, US Airways, Atlas Air, Emirates, North American Airlines, Miami Air, Spirit Airlines, Continental Airlines, Pan Am, Atlantic Coast Airlines, Alaska Airlines and Flair Airlines, as well as the United States Army, and Air Force. In addition, our management team has a diversity of experience from other industries at companies such as KBR, Carnival Cruise Lines, Palms Casino Resort, Teladoc, Halliburton, and the Burger King Corporation.

Business Strategy

GlobalX seeks to become the best-in-class U.S. narrow-body, ACMI and full services contract charter airline, operating both passenger and cargo charter aircraft while recruiting and maintaining a dynamic team of customer-centric flight crews, ground teams and management staff.

In launching a US 121 Domestic Flag and Supplemental charter airline in the United States, GlobalX has done the following:

Launch passenger charter flights with A320/A321 all passenger aircraft

GlobalX operates its A320 family aircraft under ACMI/Full Contract charter operations for major airlines, tour operators, college and professional sports teams, incentive groups, major resorts and casino groups.

Results of Operations

The following discussion should be read in conjunction with our Financial Statements and other financial information appearing and referred to elsewhere in this report.

Years ended December 31, 2024 and 2023

Operating Revenue & Statistics

The following discussion should be read in conjunction with our Financial Statements and other financial information appearing and referred to elsewhere in this report.

The analysis of GlobalX results for the twelve months period ended on December 31, 2024 and 2023 requires an understanding of how the Company fundamentally evolved during that time period. 2023 was our second year of full operations and was a period where the company was focused on securing additional customers, entering new markets and flying to additional locations; primarily in the domestic and Caribbean markets and within the European market. As a growing company, we were also focused on operating effectively and efficiently.

By contrast in 2024, GlobalX expanded existing government agency relationships, acquired new partners, secured longer term Cargo contracts, expanded operations in the European ACMI market and continued operating for existing airlines. Our key metric is block hours flown and block hours flown per available aircraft, which is the measure by which we track commercial activity. While other airlines discuss available seat miles and revenue per available seat mile ("rasm"), cost per available seat mile ("casm"), these metrics are not germane to our business model as an ACMI and Charter operator. GlobalX charters the entire aircraft, does not take fuel risk, and does not take third party risk therefore all results are evaluated on a block hour basis.

The following table compares our Operating Fleet (average aircraft equivalents during the period) and total Block Hours operated:

		Year Ended December 31,
Operating Fleet		2024				2023				Inc/(Dec)				% Change
A319			1.0				0.3				0.7				233.3	%
A320			9.2				6.8				2.4				35.3	%
A321			6.2				3.5				2.7				77.1	%
Total Operating Average Aircraft Equivalents			16.4				10.6				5.8				54.7	%
Net Aircraft Available			14.3				9.7				4.6				47.4	%
Total Block Hours			26,629				18,072				8,557				47.3	%
Average Utilization per available aircraft			1,862				1,863				(1	)			-0.1	%

The following table describes the degree to which variations in revenues (in thousands) can be attributed to fluctuations in prices and nature of GlobalX services.

		Year Ended December 31,
Revenue		2024				2023				Inc/(Dec)				% Change
Charter		$	95,456			$	114,124			$	(18,668	)		-16.4%
ACMI			123,061				40,477				82,584			204.0%
Other			5,234				5,521				(287	)		-5.2%
Total		$	223,751			$	160,122			$	63,629			39.7%
Block Hours
Charter			6,030				8,852				(2,822	)		-31.9%
Sub-service Charter			1,552				1,690				(138	)		-8.2%
Total Charter			7,582				10,542				(2,960	)		-28.1%
ACMI			19,899				9,157				10,742			117.3%
Subservice ACMI			640				219				421			192.2%
Total ACMI			20,539				9,376				11,163			119.1%
Non Revenue			699				63				636			1009.5%
Total			28,820				19,981				8,839			44.2%
Revenue per Block Hour
Charter		$	12.6			$	10.8			$	1.8			16.7%
ACMI		$	6.0			$	4.3			$	1.7			39.5%

Charter revenue for the period decreased $18.7 million or 16.4 %, from $114.1 million in 2023 to $95.5 million in 2024. The rate for Charter flying increased 16.7% from $10,826 per block hour to $12,590 per block hour resulting in a $13.4 million increase. This was offset by a $32.1 million reduction due to charter block hours decreasing 28.1% from 10,542 to 7,582 block hours. The increase in the rate per block hour is primarily driven by high market demand and a supply shortage as competitors reduced capacity to increase demand, higher fuel and handling fees and the mix of flying. The decrease in charter block hours was due to the increased level of flying on an ACMI basis.

ACMI revenue for the period increased by $82.6 million or 204.0% from $40.5 million in 2023 to $123.1 million in 2024. This variance is driven by an increase from 9,376 block hours in 2023 to 20,539 block hours in 2024, an increase of 119.1% or 11,163 block hours. This volume accounted for 58.4% or $48.2 million of the increase. The average revenue per block hour increased $1,675 per block hours from $4,317 per block hour in 2023 to $5,992 per block hour in 2024 and accounted for $34.4 million or 41.6% of the revenue increase. The primary driver for the increase was related to both high market demand and ability to grow our government business which is primarily operated on an ACMI basis.

Other revenue for the period decreased by $0.3 million from $5.5 million in 2023 to $5.2 million in 2024. The decrease is primarily driven by less ancillary services provided to our customers.

Operating Expenses

The following table compares our Operating Expenses (in thousands):

		Year Ended December 31,
Operating Expenses		2024				2023				Inc/(Dec)				% Change
Salaries, Wages, & Benefits		$	67,787			$	54,057			$	13,730				25.4	%
Aircraft Fuel			23,828				29,476				(5,648	)			-19.2	%
Maintenance, materials and repairs			13,210				8,603				4,607				53.6	%
Depreciation and amortization			6,271				2,293				3,978				173.5	%
Contracted ground and aviation services			19,599				20,507				(908	)			-4.4	%
Travel			11,174				8,334				2,840				34.1	%
Insurance			6,189				5,009				1,180				23.6	%
Aircraft Rent			57,677				33,632				24,045				71.5	%
Other			19,144				14,079				5,065				36.0	%
Total Operating Expenses		$	224,879			$	175,990			$	48,889				27.8	%

Salaries, wages, and benefits increased $13.7 million from $54.1 million to $67.8 million, or 25.4%, primarily due to the hiring and training of pilots and other airline personnel necessitated by the growing fleet and operations. The total number of employees grew 8.5% from 625 to 678 of which pilots increased from 138 to 142, or 2.9 %. Block hours increased 44.2% that without efficiency and scaling of the labor force would have resulted in a $23.9 million increase, however, increased efficiency and utilization of labor resulted in $10.2 million or reduction of effective labor rate per block hour of 13.1%.

Aircraft fuel decreased by $5.6 million, from $29.5 million to $23.8 or 19.2%, the volume of Charter hours decreased by 26.7% or $7.8 million. This was offset by an increase in base jet fuel of approximately 10.3% or $2.2 million.

Maintenance, materials, and repairs increased by $4.6 million, from $8.6 million to $13.2 million, or 53.6%. An increase of $0.6 million was due to a severe weather event that damaged two parked aircraft, multiple bird strikes across several aircraft and damage caused by a third-party vendor. Another $3.2 million cost increase was primarily due to volume from the increase in both the number of aircraft to 18 aircraft and the number of block hours flown which increased 8,556 or 47% from 18,072 to 26,628 block hours. Another, $0.8 million increase is due to a rate per block hour increase of 6.3% from $431 per block hour to $458 per block hour.

Depreciation and amortization increased $4.0 million, from $2.3 million to $6.3 million or 173.5%, driven by assets acquired to support our airport operations. These assets include, but are not limited to, aircraft deliveries secured on capital leases, computers, software, and rotable inventory.

Contracted ground and aviation services decreased by $0.9 million from $20.5 million to $19.6 million, or 4.4%. A rate increase of 32.5% per block hour drove an increase of $4.8 million. This was offset by lower charter block hours by 27.8%, which drove a reduction of $5.7 million.

Travel increased $2.8 million, from $8.3 million to $11.1 million or 34.1%. The primary driver of increased travel expense was the growth of our government agency business which required a greater than normal number of crews to be reposition and put in hotels than normal in order to rapidly respond to the demand. Throughout the year we expanded local hiring in those key bases and the reliance on travel dropped and is a cost that will be a continued focus in 2025.

Insurance increased $1.2 million, from $5.0 million to $6.2 million or 34.1%, primarily related to the increase in the number of aircraft.

Aircraft rent increased $24.0 million, from $33.6 million to $57.6 million or 71.5%, primarily due to the increase in the average number of aircraft from 10.6 to 16.4 aircraft in the fleet. $18.4 million or 76.5% of the increase is driven by the increase in the number of aircraft being leased, with the remaining $5.6 million or 23.5% due to rate increase per aircraft and short-term ACMI leases from other airlines due to flights sold exceeded capacity available during the period.

Operating loss decreased $14.7 million, from an operating loss of $15.8 million to $1.1 million, or an 84.7% improvement. In addition, operating loss as a percentage of revenue improved from (9.9%) to (0.5%), a 9.4% improvement. This was a direct result of GlobalX's ability to grow its revenue faster than its cost structure as the airline works towards achieving scale and profitability. There are a few factors driving the improved margins. The first factor is rates as the Company was able to secure higher rates for both ACMI and Charter contracts. The Company's ACMI rate grew 39.5%, from $4,317 per block hour to $5,992 per block hour, while Charter rate per block hour is up 16.7% from $10,826 per block hour to $12,590 per block hour. The second factor is scale. As an example, when measured on a per block hour basis, Salaries, wages, and benefits dropped from $2,705 to $2,352 per block hour, an 13.1% reduction. There were also savings on a per block hour basis in travel, insurance, and general overhead expenses (other) which combined with the other factors

drove the improvement. This improvement was, in spite of the impact of the events in September, that effectively took almost 35% of the passenger fleet offline for almost two weeks. This included a severe weather event damaging two parked aircraft, multiple bird strikes across three different aircraft and a third-party vendor who severely damaged an aircraft during a routine check. A number of these are insurable events, but the impact to revenue was significant and the estimated impact to operating loss is over $5.0 million. Also, negatively impacting results. Our Cargo business continued to underperform which also served as a multimillion dollar drag to earnings in 2024. In addition, there were $2.9 million in costs incurred related to the return of one aircraft and the guarantee of the Canada Jetlines aircraft that negatively impacted the operating loss and will not be repeated in 2025.

Non-operating Expenses (Income)

The following table compares our Non-operating Expenses (Income):

		Year Ended December 31,
Non-Operating Expenses (Income)		2024				2023				Inc/(Dec)				% Change
Interest Expense		$	8,955			$	4,916			$	4,039				82.2	%
Total Non-Operating Expenses (Income)		$	8,955			$	4,916			$	4,039				82.2	%

Interest expense, net increased $4.0 million from $4.9 million to $8.9 million driven mainly by the interest payable on the debentures issued in 2023.

Net Loss

Net Loss due to events noted above, decreased by $9.4 million or 45.2%, from a net loss of $20.8 million in 2023 to $11.4 million in 2024.

Liquidity and Capital Resources

The most significant liquidity events during 2024 were as follows:

Operating Activities.For 2024, net cash provided by operating activities increased $9.5 million to $8.1 million, consisting primarily of $21.2 million in noncash adjustments for depreciation and amortization of fixed assets, operating lease right of use assets and debt issue costs, $5.3 million of increase in accounts payable, $3.2 million of decrease in accounts receivable, $0.4 million of decrease in prepaid expenses and other current assets, $3.0 million in interest on finance leases, $1.7 million of share-based payments and $0.5 million of credit losses. These were partially offset by $14.4 million of increase in operating leases obligations, $1.3 million of decrease in accrued liabilities and other liabilities, $0.4 million of increase of assets held for sale and $11.4 million of net loss. For 2023, net cash used in operating activities decreased $2.2 million to $1.4 million, consisting primarily of $11.4 million in noncash adjustments for depreciation and amortization of fixed assets, operating lease right of use assets and debt issue costs, $17.4 million of increase in accrued liabilities and other liabilities, $2.4 million of increase of accounts payables, $1.7 million of decrease in assets held for sale, $2.5 million of share-based payments and $0.4 million in interest on finance leases. These were partially offset by $20.8 million of net loss, $7.7 million of increase in accounts receivable, $7.9 million of increase in operating lease obligations and $0.3 million of increase in prepaid expenses and other current assets.

As of December 31, 2024, the Company had approximately $12.3 million in unrestricted cash and cash equivalents and approximately $1.7 million in restricted cash, an increase and decrease of approximately $0.7 million and $4.4 million, respectively, from December 31, 2023. The changes were primarily due to new aircraft deliveries, deposits, and net loss in operations. Management is confident that the augmented cash and cash equivalents, coupled with the anticipated rise in sales linked to the Company's strategies to attract more funds, will adequately address the Company's liquidity requirements. Management is actively assessing various options to procure additional funds, including exploring opportunities for additional equity or debt financing.

The Company has significant fixed and noncancelable lease commitments of aircraft, equipment and related maintenance checks. As of December 31, 2024, the Company had total of $19.9 million due in the next 12 months of future minimum lease payments under finance and operating leases. As of December 31, 2024, the Company had total of $100.3 million due after 12 months from the balance sheet date of future minimum lease payments under finance and operating leases, respectively, and approximately $29.7 million in notes payable included in the non-current liabilities presented in the Company's Consolidated Balance Sheet. The Company finished 2024 with fourteen passenger aircraft and four cargo aircraft and expects the fleet to increase to nineteen passenger aircraft and remain at four cargo aircraft by the end of 2025. To achieve the number of aircraft deliveries in 2025, the Company currently has four aircrafts under

lease with partial or total deposits paid and one aircraft under binding agreements that are subject to execution of definitive lease documentation and fulfillment of certain closing conditions.

Investing Activities. For 2024, net cash used for investing activities decreased $3.2 million to $10.0 million, consisting of $2.8 million of decrease of deposit, deferred costs and other assets and $7.2 million of purchases of property and equipment. For 2023, net cash used for investing activities increased $8.0 million to $13.2 million, consisting of $9.1 million of increase of deposit, deferred costs and other assets and $4.0 million of purchases of property and equipment.

Financing Activities. For 2024, net cash used in financing activities was $1.7 million, consisting of $1.8 million of Principal payments on finance leases and $0.2 million of Noncontrolling interest dividends paid, partially offset by $0.3 million from Proceeds on issuance of shares. For 2023, net cash provided by financing activities was $26.8 million, consisting primarily of net proceeds of approximately $24.9 million from note payable, and $1.9 million from Proceeds on issuance of shares.

The Company continuously seeks to identify external sources of capital from time to time depending on our cash requirements, assessment of current and anticipated market conditions, and the after-tax cost of capital. Our access to capital markets can be adversely impacted by prevailing economic conditions and by financial, business and other factors, some of which are beyond our control. Additionally, the Company's borrowing costs are affected by market conditions and may be adversely impacted by a tightening in credit markets.

The Company regularly assesses our anticipated working capital needs, debt and leverage levels, debt maturities, capital expenditure requirements and future investments or acquisitions to maximize shareholder return, efficiently finance our ongoing operations and maintain flexibility for future strategic transactions. The Company also regularly evaluates its liquidity and capital structure to ensure financial risks, adequate liquidity access and lower cost of capital are efficiently managed.

Off-Balance Sheet Arrangements

As of December 31, 2024, the Company had no off-balance sheet arrangements.

Critical Accounting Estimates

The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures in the financial statements. Management considers an accounting estimate to be critical if:

We base our estimates and judgments on our experience, our current knowledge, our beliefs of what could occur in the future, our observation of trends in the industry, information provided by our customers and information available from other resources. Actual results may differ from the estimates under different assumptions or conditions. We have identified the following policies and estimates as those that we believe are most critical to our financial condition and results of operations and that require management's most subjective and complex judgments in estimating the effect of inherent uncertainties: allowance for credit losses, fair value measurements for stock-based compensation and deferred tax valuation allowance. See footnote 2 of the Company's consolidated financial statements for significant accounting policies.

Recently Issued Accounting Standards

In November 2023, the FASB issued ASU 2023-07 - Improvements to Reportable Segment Disclosures - Amendments in this update improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted the provisions of ASU 2023-07 as of December 31, 2024, which did not materially impact the Company's consolidated financial statements. Refer to our significant accounting policies below for the impact of adoption.

In December 2023, the FASB issued ASU 2023-09 - Improvements to Income Tax Disclosures - Amendments in this update require: that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional

information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income [or loss] by the applicable statutory income tax rate). All entities disclose on an annual basis the following information about income taxes paid: 1. The amount of income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes 2. The amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received). All entities disclose the following information: 1. Income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign 2. Income tax expense (or benefit) from continuing operations disaggregated by federal (national), state, and foreign. The amendments in this Update eliminate the requirement for all entities to (1) disclose the nature and estimate of the range of the reasonably possible change in the unrecognized tax benefits balance in the next 12 months or (2) make a statement that an estimate of the range cannot be made. The amendments in this Update remove the requirement to disclose the cumulative amount of each type of temporary difference when a deferred tax liability is not recognized because of the exceptions to comprehensive recognition of deferred taxes related to subsidiaries and corporate joint ventures. The amendments in this Update replace the term public entity as currently used in Topic 740 with the term public business entity as defined in the Master Glossary of the Codification. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2024. Management expects no significant impact after adoption of the new standard.



In March 2024, the FASB issued ASU 2024-01 - Compensation-Stock Compensation - Amendments to improve generally accepted accounting principles (GAAP) by adding an illustrative example to demonstrate how an entity should apply the scope guidance in paragraph 718-10-15-3 to determine whether profits interest and similar awards ("profits interest awards") should be accounted for in accordance with Topic 718, Compensation-Stock Compensation. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2024. Management expects no significant impact after adoption of the new standard.