HG Holdings Reports 30% Revenue Growth and Net Income Turnaround in Q2 2025

HG Holdings, Inc. reported a significant increase in financial performance for the second quarter of 2025, with total revenues reaching $4.06 million, up from $3.12 million in the same period last year, marking a 30% increase. For the first half of 2025, revenues totaled $6.78 million, compared to $5.82 million in the first half of 2024, reflecting a 16% growth. The company achieved a net income of $885,000 for the second quarter, a turnaround from a net loss of $258,000 in the prior year, while the first half of 2025 saw a net income of $628,000 compared to a loss of $239,000 in 2024.

The company’s improved performance can be attributed to several factors, including an increase in net premiums written, which rose to $1.998 million in the second quarter from $1.670 million a year earlier. Escrow and other title fees also saw an increase, totaling $812,704 in the second quarter, compared to $1.396 million in the same period last year. Management fees from related parties increased significantly, contributing to the overall revenue growth. The company noted that the increase in management fees was due to a new Services Agreement with HP Risk, effective June 1, 2025, which is expected to generate $6 million annually over three years.

Operationally, HG Holdings has made strategic changes, including a shift in its reportable segments to focus on Title Insurance and Corporate and Other, effective January 1, 2025. This restructuring reflects the evolving business mix and management's focus on performance monitoring. The company also completed a significant transaction involving the acquisition of a 39.1% equity interest in ACMAT Corporation, which was recorded as a $12.5 million investment. This transaction was part of a broader strategy to enhance its investment portfolio and leverage its net operating loss carryforwards.

As of June 30, 2025, HG Holdings reported total assets of $54.25 million, up from $42.17 million at the end of 2024. The company’s cash and cash equivalents decreased to $9.45 million from $12.15 million, while restricted cash increased to $11.07 million from $8.26 million. The total liabilities also rose to $13.15 million from $10.36 million, primarily due to increased escrow liabilities. The company’s stockholders’ equity increased to $41.22 million, reflecting the positive net income and strategic equity transactions.

Looking ahead, HG Holdings anticipates continued revenue growth driven by its title insurance operations, which are closely tied to real estate activity. However, the company acknowledges potential challenges due to fluctuating mortgage rates and overall market conditions. The management remains optimistic about leveraging its recent strategic developments and operational efficiencies to enhance shareholder value in the coming quarters.