Note 17 - Restatement of Quarterly Financial Information (Unaudited)

12 Months Ended

Dec. 31, 2024

Quarterly Financial Information [Text Block]

17. Restatement of Quarterly Financial Information (Unaudited)

Prior to the filing of the Company’s December 31, 2024 Form 10-K, management determined that there was an error in the reported gain on sale of its joint venture in Brazil during the quarter ended June 30, 2024, which resulted in the gain being overstated and additional paid in capital being understated (the “Original Adjustment”). Management determined that there was an error in the reported gain on sale of its joint venture in Brazil during the quarter ended June 30, 2024, which resulted in the gain being overstated and additional paid in capital being understated. The Company’s management and the audit committee of the Company’s Board of Directors concluded that it is appropriate to restate the unaudited quarterly condensed consolidated financial statements for the quarterly periods ended June 30, 2024 and September 30, 2024 (collectively, the “Original as Restated”).

Subsequent to the filing of the Company’s December 31, 2024 Form 10-K, management determined that the Company's Brazilian joint venture should be presented as discontinued operations as of June 30, 2024 (the “Adjustment”). The Company’s management and the audit committee of the Company’s Board of Directors concluded that it is appropriate to restate the unaudited quarterly condensed consolidated financial statements for the quarterly periods ended June 30, 2024 and September 30, 2024. The following presents the restated unaudited quarterly condensed financial statements as of June 30, 2024, September 30, 2024, and for the three and six month periods ended June 30, 2024 and 2023 and the three and nine month periods ended September 30, 2024 and 2023 (collectively, the “Restated”).

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

June 30, 2024

As Previously Reported

Original Adjustment

Restated

Assets

Current assets:

Cash and cash equivalents

21,695

Accounts receivable, net

37,963

Prepaid expenses and other current assets

2,117

Current assets of discontinued operations

Total current assets

61,775

Property and equipment, net

2,467

Operating lease right-of-use assets

1,154

Goodwill

1,238

Intangible assets, net

718

Deferred income taxes, net

1,029

Other assets

1,644

Non-current assets of discontinued operations

Total assets

70,025

Liabilities and stockholders' equity

Current liabilities:

Accounts payable

7,211

Accrued expenses and other current liabilities

5,643

Due to affiliates

623

Customer incentives and deposits

4,541

Lines of credit and short-term loans

18,442

Current portion of operating lease liabilities

482

Current liabilities of discontinued operations

Total current liabilities

36,942

Operating lease liabilities, net of current portion

672

Long-term debt

1,711

Non-current liabilities of discontinued operations

Total liabilities

39,325

Commitments and contingencies – See Note 7

Stockholders' equity:

Series B convertible preferred stock, $0.01 par value per share: Authorized and available shares 3,000,000. Issued and outstanding shares 0 at June 30, 2024 and 650,000 at December 31, 2023

Common stock, $0.01 par value per share: 47,000,000 shares authorized as of June 30, 2024 and December 31, 2023; 23,419,744 and 23,446,444 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

234

Treasury stock, at cost, 1,205,485 shares as of June 30, 2024 and 205,485 as of December 31, 2023

(2,075

)

(2,075

)

Additional paid-in capital

13,338

7,518

20,856

Accumulated other comprehensive (loss)

(2,268

)

(2,268

)

Retained earnings

20,151

(7,518

)

12,633

Total stockholders' equity attributable to SPAR Group, Inc.

29,380

Non-controlling interest

1,320

Total stockholders’ equity

30,700

Total liabilities and stockholders’ equity

70,025

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

September 30, 2024

As Previously Reported

Original Adjustment

Restated

Assets

Current assets:

Cash and cash equivalents

19,652

Accounts receivable, net

37,777

Prepaid expenses and other current assets

3,078

Current assets of discontinued operations

Total current assets

60,507

Property and equipment, net

2,142

Operating lease right-of-use assets

838

Goodwill

1,238

Intangible assets, net

693

Deferred income taxes, net

Other assets

1,978

Non-current assets of discontinued operations

Total assets

67,396

Liabilities and stockholders' equity

Current liabilities:

Accounts payable

9,220

Accrued expenses and other current liabilities

3,713

Due to affiliates

623

Customer incentives and deposits

1,678

Lines of credit and short-term loans

18,538

Current portion of operating lease liabilities

508

Current liabilities of discontinued operations

Total current liabilities

34,280

Operating lease liabilities, net of current portion

330

Deferred income taxes, net

1,707

Long-term debt

1,538

Non-current liabilities of discontinued operations

Total liabilities

37,855

Commitments and contingencies – See Note 7

Stockholders' equity:

Series B convertible preferred stock, $0.01 par value per share: Authorized and available shares 3,000,000. Issued and outstanding shares 0 at June 30, 2024 and 650,000 at December 31, 2023

234

Treasury stock, at cost, 1,205,485 shares as of June 30, 2024 and 205,485 as of December 31, 2023

(2,075

)

(2,075

)

Additional paid-in capital

13,151

7,556

20,707

Accumulated other comprehensive (loss)

(2,022

)

(2,022

)

Retained earnings

20,007

(7,556

)

12,451

Total stockholders' equity attributable to SPAR Group, Inc.

29,295

Non-controlling interest

246

Total stockholders’ equity

29,541

Total liabilities and stockholders’ equity

67,396

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

(In thousands, except per share data)

	*Three Months Ended*															*Three Months Ended*
	*June 30, 2024*															*June 30, 2023*
	*As Previously Reported*			*Original Adjustment*			*Original As Restated*			*Adjustment*			*Restated*			*As Previously Reported*			*Adjustment*			*Restated*

Net revenues	$	57,290		$	-		$	57,290		$	(13,888	)	$	43,402		$	65,936		$	(20,016	)	$	45,920
Related party - cost of revenues		-			-			-			-			-			1,682			-			1,682
Cost of revenues		46,297			-			46,297			(11,859	)		34,438			51,158			(17,124	)		34,034
Gross profit		10,993			-			10,993			(2,029	)		8,964			13,096			(2,892	)		10,204
Selling, general and administrative expense		9,541			-			9,541			(1,473	)		8,068			10,605			(1,810	)		8,795
(Gain) / loss on sale of business		(4,919	)		7,518			2,599			(1,188	)		1,411			-			-			-
Depreciation and amortization		478			-			478			(27	)		451			494			(43	)		451
Operating income (loss)		5,893			(7,518	)		(1,625	)		659			(966	)		1,997			(1,039	)		958
Interest expense		567			-			567			23			590			478			24			502
Other income, net		(296	)		-			(296	)		-			(296	)		(125	)		-			(125	)
Income (loss) before income tax expense		5,622			(7,518	)		(1,896	)		636			(1,260	)		1,644			(1,063	)		581
Income tax expense (benefit)		1,547			-			1,547			(613	)		934			538			(309	)		229
Income (loss) from continuing operations		4,075			(7,518	)		(3,443	)		1,249			(2,194	)		1,106			(754	)		352

Discontinued Operations
Income from discontinued operations		-			-			-			552			552			-			1,063			1,063
Loss on disposal of business		-			-			-			(1,188	)		(1,188	)		-			-			-
Income tax expense		-			-			-			(613	)		(613	)		-			(309	)		(309	)
Net income (loss) from discontinued operations		-			-			-			(1,249	)		(1,249	)		-			754			754

Net income (loss)		4,075			(7,518	)		(3,443	)		-			(3,443	)		1,106			-			1,106
Net income attributable to non-controlling interest		(448	)		-			(448	)		-			(448	)		(467	)		-			(467	)
Net income (loss) attributable to SPAR Group, Inc.	$	3,627		$	(7,518	)	$	(3,891	)		-		$	(3,891	)	$	639			-		$	639
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	0.15		$	(0.32	)	$	(0.17	)	$	0.05		$	(0.12	)	$	0.03		$	(0.03	)	$	-
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	0.15		$	(0.31	)	$	(0.16	)	$	0.05		$	(0.11	)	$	0.03		$	(0.03	)	$	-
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	(0.05	)	$	(0.05	)	$	-		$	0.03		$	0.03
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	(0.05	)	$	(0.05	)	$	-		$	0.03		$	0.03
Basic earnings (loss) per common share attributable to SPAR Group, Inc.	$	0.15		$	(0.32	)	$	(0.17	)	$	-		$	(0.17	)	$	0.03		$	-		$	0.03
Diluted earnings (loss) per common share attributable to SPAR Group, Inc.	$	0.15		$	(0.31	)	$	(0.16	)	$	-		$	(0.16	)	$	0.03		$	-		$	0.03
Weighted-average common shares outstanding – basic		23,786			-			23,786			-			23,786			23,250			-			23,250
Weighted-average common shares outstanding – diluted		24,010			-			24,010			-			24,010			23,392			-			23,392

Net income (loss)	$	4,075		$	(7,518	)	$	(3,443	)	$	-		$	(3,443	)	$	1,106		$	-		$	1,106
Other comprehensive income (loss)
Foreign currency translation adjustments		1,372			–			1,372			–			1,372			(39	)		–			(39	)
Comprehensive income (loss)		5,447			(7,518	)		(2,071	)		-			(2,071	)		1,067			-			1,067
Comprehensive income attributable to non-controlling interest		(393	)		-			(393	)		-			(393	)		(97	)		-			(97	)
Comprehensive income (loss) attributable to SPAR Group, Inc.	$	5,054		$	(7,518	)	$	(2,464	)	$	-		$	(2,464	)	$	970		$	-		$	970

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

(In thousands, except per share data)

	*Three Months Ended*														*Three Months Ended*
	*September 30, 2024*														*September 30, 2023*
	*As Previously Reported*			*Original Adjustment*			*Original As Restated*			*Adjustment*		*Restated*			*As Previously Reported*			*Adjustment*			*Restated*

Net revenues	$	37,788		$	-		$	37,788		$	-	$	37,788		$	67,333		$	(18,619	)	$	48,714
Related party - cost of revenues		-			-			-			-		-			1,628			-			1,628
Cost of revenues		29,346			-			29,346			-		29,346			52,332			(15,886	)		36,446
Gross profit		8,442			-			8,442			-		8,442			13,373			(2,733	)		10,640
Selling, general and administrative expense		8,558			-			8,558			-		8,558			11,284			(1,941	)		9,343
Loss on sale of business		922			38			960			-		960			-			-			-
Depreciation and amortization		454			-			454			-		454			548			(51	)		497
Operating income (loss)		(1,492	)		(38	)		(1,530	)		-		(1,530	)		1,541			(741	)		800
Interest expense		582			-			582			-		582			380			135			515
Other expense (income), net		472			-			472			-		472			(164	)		-			(164	)
Income (loss) before income tax benefit		(2,546	)		(38	)		(2,584	)		-		(2,584	)		1,325			(876	)		449
Income tax expense (benefit)		(2,314	)		-			(2,314	)		-		(2,314	)		227			356			583
Income (loss) from continuing operations		(232	)		(38	)		(270	)		-		(270	)		1,098			(1,232	)		(134	)

Discontinued Operations
Income from discontinued operations		-			-			-			-		-			-			876			876
Loss on disposal of business		-			-			-			-		-			-			-			-
Income tax benefit		-			-			-			-		-			-			356			356
Net income from discontinued operations		-			-			-			-		-			-			1,232			1,232

Net income (loss)		(232	)		(38	)		(270	)		-		(270	)		1,098			-			1,098
Net loss (income) attributable to non-controlling interest		88			-			88			-		88			(839	)		-			(839	)
Net income (loss) attributable to SPAR Group, Inc.	$	(144	)	$	(38	)	$	(182	)	$	-	$	(182	)	$	259		$	-		$	259
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	(0.01	)	$	-		$	(0.01	)	$	-	$	(0.01	)	$	0.01		$	(0.05	)	$	(0.04	)
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	(0.01	)	$	-		$	(0.01	)	$	-	$	(0.01	)	$	0.01		$	(0.05	)	$	(0.04	)
Basic earnings per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	-	$	-		$	-		$	0.05		$	0.05
Diluted earnings per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	-	$	-		$	-		$	0.05		$	0.05
Basic earnings (loss) per common share attributable to SPAR Group, Inc.	$	(0.01	)	$	-		$	(0.01	)	$	-	$	(0.01	)	$	0.01		$	-		$	0.01
Diluted earnings (loss) per common share attributable to SPAR Group, Inc.	$	(0.01	)	$	-		$	(0.01	)	$	-	$	(0.01	)	$	0.01		$	-		$	0.01
Weighted-average common shares outstanding – basic		23,435			-			23,435			-		23,435			23,237			-			23,237
Weighted-average common shares outstanding – diluted		23,435			-			23,435			-		23,435			23,376			-			23,376

Net income (loss)	$	(232	)	$	(38	)	$	(270	)	$	-	$	(270	)	$	1,098		$	-		$	1,098
Other comprehensive loss
Foreign currency translation adjustments		(72	)		–			(72	)		–		(72	)		(497	)		–			(497	)
Comprehensive income (loss)		(304	)		(38	)		(342	)		-		(342	)		601			-			601
Comprehensive loss (income) attributable to non-controlling interest		45			-			45			-		45			(688	)		-			(688	)
Comprehensive (loss) attributable to SPAR Group, Inc.	$	(259	)	$	(38	)	$	(297	)	$	-	$	(297	)	$	(87	)	$	-		$	(87	)

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

(In thousands, except per share data)

	*Six Months Ended*															*Six Months Ended*
	*June 30, 2024*															*June 30, 2023*
	*As Previously Reported*			*Original Adjustment*			*Original As Restated*			*Adjustment*			*Restated*			*As Previously Reported*			*Adjustment*			*Restated*

Net revenues	$	125,984		$	-		$	125,984		$	(33,185	)	$	92,799		$	130,316		$	(38,098	)	$	92,218
Related party - cost of revenues		-			-			-			-			-			3,179			-			3,179
Cost of revenues		102,448			-			102,448			(28,325	)		74,123			99,903			(32,697	)		67,206
Gross profit		23,536			-			23,536			(4,860	)		18,676			27,234			(5,401	)		21,833
Selling, general and administrative expense		19,158			-			19,158			(3,385	)		15,773			21,061			(3,446	)		17,615
(Gain) / loss on sale of business		(12,076	)		7,518			(4,558	)		(1,188	)		(5,746	)		-			-			-
Depreciation and amortization		989			-			989			(63	)		926			1,026			(85	)		941
Operating income (loss)		15,465			(7,518	)		7,947			(224	)		7,723			5,147			(1,870	)		3,277
Interest expense (income)		1,097			-			1,097			(31	)		1,066			868			130			998
Other income, net		(288	)		-			(288	)		-			(288	)		(183	)		-			(183	)
Income (loss) before income tax expense		14,656			(7,518	)		7,138			(193	)		6,945			4,462			(2,000	)		2,462
Income tax expense (benefit)		3,401			-			3,401			(1,074	)		2,327			1,579			(736	)		843
Income (loss) from continuing operations		11,255			(7,518	)		3,737			881			4,618			2,883			(1,264	)		1,619

Discontinued Operations
Income from discontinued operations		-			-			-			1,381			1,381			-			2,000			2,000
Loss on disposal of business		-			-			-			(1,188	)		(1,188	)		-			-			-
Income tax expense		-			-			-			(1,074	)		(1,074	)		-			(736	)		(736	)
Net income (loss) from discontinued operations		-			-			-			(881	)		(881	)		-			1,264			1,264

Net income (loss)		11,255			(7,518	)		3,737			-			3,737			2,883			-			2,883
Net income attributable to non-controlling interest		(1,002	)		-			(1,002	)		-			(1,002	)		(1,378	)		-			(1,378	)
Net income (loss) attributable to SPAR Group, Inc.	$	10,253		$	(7,518	)	$	2,735		$	-		$	2,735		$	1,505		$	-		$	1,505
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	0.43		$	(0.32	)	$	0.11		$	0.04		$	0.15		$	0.06		$	(0.05	)	$	0.01
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	0.43		$	(0.31	)	$	0.12		$	0.04		$	0.16		$	0.06		$	(0.05	)	$	0.01
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	(0.04	)	$	(0.04	)	$	-		$	0.05		$	0.05
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	(0.04	)	$	(0.04	)	$	-		$	0.05		$	0.05
Basic earnings (loss) per common share attributable to SPAR Group, Inc.	$	0.43		$	(0.32	)	$	0.11		$	-		$	0.11		$	0.06		$	-		$	0.06
Diluted earnings (loss) per common share attributable to SPAR Group, Inc.	$	0.43		$	(0.31	)	$	0.12		$	-		$	0.12		$	0.06		$	-		$	0.06
Weighted-average common shares outstanding – basic		23,670			-			23,670			-			23,670			23,182			-			23,182
Weighted-average common shares outstanding – diluted		23,873			-			23,873			-			23,873			23,337			-			23,337

Net income (loss)	$	11,255		$	(7,518	)	$	3,737		$	-		$	3,737		$	2,883		$	-		$	2,883
Other comprehensive income (loss)
Foreign currency translation adjustments		(1,148	)		–			(1,148	)		–			(1,148	)		138			–			138
Comprehensive income (loss)		10,107			(7,518	)		2,589			-			2,589			3,021			-			3,021
Comprehensive (income) loss attributable to non-controlling interest		97			-			97			-			97			(1,100	)		-			(1,100	)
Comprehensive income (loss) attributable to SPAR Group, Inc.	$	10,204		$	(7,518	)	$	2,686		$	-		$	2,686		$	1,921		$	-		$	1,921

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

(In thousands, except per share data)

	*Nine Months Ended*															*Nine Months Ended*
	*September 30, 2024*															*September 30, 2023*
	*As Previously Reported*			*Original Adjustment*			*Original As Restated*			*Adjustment*			*Restated*			*As Previously Reported*			*Adjustment*			*Restated*

Net revenues	$	163,771		$	-		$	163,771		$	(33,185	)	$	130,586		$	197,649		$	(56,717	)	$	140,932
Related party - cost of revenues		-			-			-			-			-			4,807			-			4,807
Cost of revenues		131,801			-			131,801			(28,325	)		103,476			152,235			(48,584	)		103,652
Gross profit		31,970			-			31,970			(4,860	)		27,110			40,607			(8,134	)		32,473
Selling, general and administrative expense		27,707			-			27,707			(3,385	)		24,322			32,345			(5,394	)		26,951
(Gain) / loss on sale of business		(11,154	)		7,556			(3,598	)		(1,188	)		(4,786	)		-			-			-
Depreciation and amortization		1,443			-			1,443			(63	)		1,380			1,574			(136	)		1,438
Operating income (loss)		13,974			(7,556	)		6,418			(224	)		6,194			6,688			(2,604	)		4,084
Interest expense (income)		1,678			-			1,678			(31	)		1,647			1,248			265			1,513
Other expense (income), net		184			-			184			-			184			(347	)		-			(347	)
Income (loss) before income tax expense		12,112			(7,556	)		4,556			(193	)		4,363			5,787			(2,869	)		2,918
Income tax expense (benefit)		1,088			-			1,088			(1,074	)		14			1,806			(380	)		1,426
Income (loss) from continuing operations		11,024			(7,556	)		3,468			881			4,349			3,981			(2,489	)		1,492

Discontinued Operations
Income from discontinued operations		-			-			-			1,381			1,381			-			2,869			2,869
Loss on disposal of business		-			-			-			(1,188	)		(1,188	)		-			-			-
Income tax benefit (expense)		-			-			-			(1,074	)		(1,074	)		-			(380	)		(380	)
Net income (loss) from discontinued operations		-			-			-			(881	)		(881	)		-			2,489			2,489

Net income (loss)		11,024			(7,556	)		3,468			-			3,468			3,981			-			3,981
Net income attributable to non-controlling interest		(914	)		-			(914	)		-			(914	)		(2,217	)		-			(2,217	)
Net income (loss) attributable to SPAR Group, Inc.	$	10,110		$	(7,556	)	$	2,554		$	-		$	2,554		$	1,764		$	-		$	1,764
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	0.43		$	(0.32	)	$	0.11		$	0.04		$	0.15		$	0.08		$	(0.11	)	$	(0.03	)
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from continuing operations	$	0.43		$	(0.32	)	$	0.11		$	0.04		$	0.15		$	0.08		$	(0.11	)	$	(0.03	)
Basic earnings (loss) per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	(0.04	)	$	(0.04	)	$	-		$	0.11		$	0.11
Diluted earnings (loss) per common share attributable to SPAR Group, Inc. from discontinued operations	$	-		$	-		$	-		$	(0.04	)	$	(0.04	)	$	-		$	0.11		$	0.11
Basic earnings (loss) per common share attributable to SPAR Group, Inc.	$	0.43		$	(0.32	)	$	0.11		$	-		$	0.11		$	0.08		$	-		$	0.08
Diluted earnings (loss) per common share attributable to SPAR Group, Inc.	$	0.43		$	(0.32	)	$	0.11		$	-		$	0.11		$	0.08		$	-		$	0.08
Weighted-average common shares outstanding – basic		23,591			-			23,591			-			23,591			23,201			-			23,201
Weighted-average common shares outstanding – diluted		23,768			-			23,768			-			23,768			23,350			-			23,350

Net income (loss)	$	11,024		$	(7,556	)	$	3,468		$	-		$	3,468		$	3,981		$	-		$	3,981
Other comprehensive loss
Foreign currency translation adjustments		(1,220	)		–			(1,220	)		–			(1,220	)		(359	)		–			(359	)
Comprehensive income (loss)		9,804			(7,556	)		2,248			-			2,248			3,622			-			3,622
Comprehensive loss (income) attributable to non-controlling interest		142			-			142			-			142			(1,788	)		-			(1,788	)
Comprehensive income (loss) attributable to SPAR Group, Inc.	$	9,946		$	(7,556	)	$	2,390		$	-		$	2,390		$	1,834		$	-		$	1,834

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders' Equity

Three Months Ended June 30

(In thousands)

As Previously Reported	*Common Stock*						*Series B Convertible Preferred Stock*				*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*			*Amount*			*Shares*		*Amount*		*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at March 31, 2024		24,216		$	242			-	$	-		205	$	(285	)	$	21,131		$	(4,659	)	$	16,524		$	7,103		$	40,056
Share-based compensation		-			-			-		-		-		-			128			-			-			-			128
Exercise of stock options		204			2			-		-		-		-			(403	)		-			-			-			(401	)
Sale of joint ventures		-			-			-		-		-		-			(7,518	)		1,412			-			(4,509	)		(10,615	)
Purchase of non-controlling interest		-			-			-		-		-		-			-			-			-			(2,115	)		(2,115	)
Purchase of treasury shares		(1,000	)		(10	)		-		-		1,000		(1,790	)		-			-			-			-			(1,800	)
Other comprehensive income		-			-			-		-		-		-			-			979			-			393			1,372
Net income		-			-			-		-		-		-			-			-			3,627			448			4,075
Balance at June 30, 2024		23,420		$	234			-	$	-		1,205	$	(2,075	)	$	13,338		$	(2,268	)	$	20,151		$	1,320		$	30,700

Original Adjustment

Sale of joint ventures		-			-			-		-		-		-			7,518			-			-			-			7,518
Net (loss)		-			-			-		-		-		-			-			-			(7,518	)		-			(7,518	)
Total Adjustments		-		$	-			-	$	-		-	$	-		$	7,518		$	-		$	(7,518	)	$	-		$	-

As Restated	*Common Stock*						*Series B Convertible Preferred Stock*				*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*			*Amount*			*Shares*		*Amount*		*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at March 31, 2024		24,216		$	242			-	$	-		205	$	(285	)	$	21,131		$	(4,659	)	$	16,524		$	7,103		$	40,056
Share-based compensation		-			-			-		-		-		-			128			-			-			-			128
Exercise of stock options		204			2			-		-		-		-			(403	)		-			-			-			(401	)
Sale of joint ventures		-			-			-		-		-		-			-			1,412			-			(4,509	)		(3,097	)
Purchase of non-controlling interest		-			-			-		-		-		-			-			-			-			(2,115	)		(2,115	)
Purchase of treasury shares		(1,000	)		(10	)		-		-		1,000		(1,790	)		-			-			-			-			(1,800	)
Other comprehensive income		-			-			-		-		-		-			-			979			-			393			1,372
Net income (loss)		-			-			-		-		-		-			-			-			(3,891	)		448			(3,443	)
Balance at June 30, 2024		23,420		$	234			-	$	-		1,205	$	(2,075	)	$	20,856		$	(2,268	)	$	12,633		$	1,320		$	30,700

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders' Equity

Three Months Ended September 30

(In thousands)

As Previously Reported	*Common Stock*				*Series B Convertible Preferred Stock*				*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*		*Amount*		*Shares*		*Amount*		*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at June 30, 2024		23,420	$	234		-	$	-		1,205	$	(2,075	)	$	13,338		$	(2,268	)	$	20,151		$	1,320		$	30,700
Share-based compensation		-		-		-		-		-		-			(149	)		-			-			-			(149	)
Exercise of stock options		28		-		-		-		-		-			-			-			-			-			-
Sale of joint ventures		-		-		-		-		-		-			(38	)		273			-			(941	)		(706	)
Purchase of non-controlling interest		-		-		-		-		-		-			-			-			-			-			-
Purchase of treasury shares		-		-		-		-		-		-			-			-			-			-			-
Other comprehensive income		-		-		-		-		-		-			-			(27	)		-			(45	)		(72	)
Net (loss)		-		-		-		-		-		-			-			-			(144	)		(88	)		(232	)
Balance at September 30, 2024		23,448	$	234		-	$	-		1,205	$	(2,075	)	$	13,151		$	(2,022	)	$	20,007		$	246		$	29,541

Original Adjustment

Balance at June 30, 2024		-	$	-		-	$	-		-	$	-		$	7,518		$	-		$	(7,518	)	$	-		$	-
Sale of joint ventures		-		-		-		-		-		-			38			-			-			-			38
Net (loss)		-		-		-		-		-		-			-			-			(38	)		-			(38	)
Total Adjustments		-	$	-		-	$	-		-	$	-		$	38		$	-		$	(38	)	$	-		$	-


As Restated	*Common Stock*				*Series B Convertible Preferred Stock*				*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*		*Amount*		*Shares*		*Amount*		*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at June 30, 2024		23,420	$	234		-	$	-		1,205	$	(2,075	)	$	20,856		$	(2,268	)	$	12,633		$	1,320		$	30,700
Share-based compensation		-		-		-		-		-		-			(149	)		-			-			-			(149	)
Exercise of stock options		28		-		-		-		-		-			-			-			-			-			-
Sale of joint ventures		-		-		-		-		-		-			-			273			-			(941	)		(668	)
Purchase of non-controlling interest		-		-		-		-		-		-			-			-			-			-			-
Purchase of treasury shares		-		-		-		-		-		-			-			-			-			-			-
Other comprehensive (loss)		-		-		-		-		-		-			-			(27	)		-			(45	)		(72	)
Net (loss)		-		-		-		-		-		-			-			-			(182	)		(88	)		(270	)
Balance at September 30, 2024		23,448	$	234		-	$	-		1,205	$	(2,075	)	$	20,707		$	(2,022	)	$	12,451		$	246		$	29,541

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders' Equity

Six Months Ended June 30

(In thousands)

As Previously Reported	*Common Stock*						*Series B Convertible Preferred Stock*						*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*			*Amount*			*Shares*			*Amount*			*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at January 1, 2024		23,241		$	232			650		$	7			205	$	(285	)	$	21,004		$	(3,341	)	$	10,609		$	12,020		$	40,246
Share-based compensation		-			-			-			-			-		-			256			-			-			-			256
Conversion of preferred stock to common stock		975			10			(650	)		(7	)							(1	)											2
Exercise of stock options		204			2			-			-			-		-			(403	)		-			-			-			(401	)
Sale of joint ventures		-			-			-			-			-		-			(7,518	)		2,124			(711	)		(9,490	)		(15,595	)
Purchase of non-controlling interest		-			-			-			-			-		-			-			-			-			(2,115	)		(2,115	)
Purchase of treasury shares		(1,000	)		(10	)		-			-			1,000		(1,790	)		-			-			-			-			(1,800	)
Other comprehensive (loss)		-			-			-			-			-		-			-			(1,051	)		-			(97	)		(1,148	)
Net income		-			-			-			-			-		-			-			-			10,253			1,002			11,255
Balance at June 30, 2024		23,420		$	234			-		$	-			1,205	$	(2,075	)	$	13,338		$	(2,268	)	$	20,151		$	1,320		$	30,700

Original Adjustment

Sale of joint ventures		-			-			-			-			-		-			7,518			-			-			-			7,518
Net (loss)		-			-			-			-			-		-			-			-			(7,518	)		-			(7,518	)
Total Adjustments		-		$	-			-		$	-			-	$	-		$	7,518		$	-		$	(7,518	)	$	-		$	-

As Restated	*Common Stock*						*Series B Convertible Preferred Stock*						*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*			*Amount*			*Shares*			*Amount*			*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at January 1, 2024		23,241		$	232			650		$	7			205	$	(285	)	$	21,004		$	(3,341	)	$	10,609		$	12,020		$	40,246
Share-based compensation		-			-			-			-			-		-			256			-			-			-			256
Conversion of preferred stock to common stock		975			10			(650	)		(7	)		-		-			(1	)		-			-			-			2
Exercise of stock options		204			2			-			-			-		-			(403	)		-			-			-			(401	)
Sale of joint ventures		-			-			-			-			-		-			-			2,124			(711	)		(9,490	)		(8,077	)
Purchase of non-controlling interest		-			-			-			-			-		-			-			-			-			(2,115	)		(2,115	)
Purchase of treasury shares		(1,000	)		(10	)		-			-			1,000		(1,790	)		-			-			-			-			(1,800	)
Other comprehensive (loss)		-			-			-			-			-		-			-			(1,051	)		-			(97	)		(1,148	)
Net income		-			-			-			-			-		-			-			-			2,735			1,002			3,737
Balance at June 30, 2024		23,420		$	234			-		$	-			1,205	$	(2,075	)	$	20,856		$	(2,268	)	$	12,633		$	1,320		$	30,700

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders' Equity

Nine Months Ended September 30

(In thousands)

As Previously Reported	*Common Stock*						*Series B Convertible Preferred Stock*						*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	*Shares*			*Amount*			*Shares*			*Amount*			*Shares*		*Amount*			*Paid-In Capital*			*Comprehensive Loss*			*Retained Earnings*			*Controlling Interest*			*Total Stockholders’ Equity*
Balance at January 1, 2024		23,241		$	232			650		$	7			205	$	(285	)	$	21,004		$	(3,341	)	$	10,609		$	12,020		$	40,246
Share-based compensation		-			-			-			-			-		-			107			-			-			-			107
Conversion of preferred stock to common stock		975			10			(650	)		(7	)							(1	)											2
Exercise of stock options		232			2			-			-			-		-			(403	)		-			-			-			(401	)
Sale of joint ventures		-			-			-			-			-		-			(7,556	)		2,397			(712	)		(10,431	)		(16,302	)
Purchase of non-controlling interest		-			-			-			-			-		-			-			-			-			(2,115	)		(2,115	)
Purchase of treasury shares		(1,000	)		(10	)		-			-			1,000		(1,790	)		-			-			-			-			(1,800	)
Other comprehensive (loss)		-			-			-			-			-		-			-			(1,078	)		-			(142	)		(1,220	)
Net income		-			-			-			-			-		-			-			-			10,110			914			11,024
Balance at September 30, 2024		23,448		$	234			-		$	-			1,205	$	(2,075	)	$	13,151		$	(2,022	)	$	20,007		$	246		$	29,541

Original Adjustment

Sale of joint ventures		-			-			-			-			-		-			7,556			-			-			-			7,556
Net (loss)		-			-			-			-			-		-			-			-			(7,556	)		-			(7,556	)
Total Adjustments		-		$	-			-		$	-			-	$	-		$	7,556		$	-		$	(7,556	)	$	-		$	-

As Restated	*Common Stock*						*Series B Convertible Preferred Stock*						*Treasury Stock*					*Additional*			*Accumulated Other*						*Non-*
	Shares			Amount			Shares			Amount			Shares		Amount			Paid-In Capital			Comprehensive Loss			Retained Earnings			Controlling Interest			Total Stockholders’ Equity
Balance at January 1, 2024		23,241		$	232			650		$	7			205	$	(285	)	$	21,004		$	(3,341	)	$	10,609		$	12,020		$	40,246
Share-based compensation		-			-			-			-			-		-			107			-			-			-			107
Conversion of preferred stock to common stock		975			10			(650	)		(7	)		-		-			(1	)		-			-			-			2
Exercise of stock options		232			2			-			-			-		-			(403	)		-			-			-			(401	)
Sale of joint ventures		-			-			-			-			-		-			-			2,397			(712	)		(10,431	)		(8,746	)
Purchase of non-controlling interest		-			-			-			-			-		-			-			-			-			(2,115	)		(2,115	)
Purchase of treasury shares		(1,000	)		(10	)		-			-			1,000		(1,790	)		-			-			-			-			(1,800	)
Other comprehensive (loss)		-			-			-			-			-		-			-			(1,078	)		-			(142	)		(1,220	)
Net income		-			-			-			-			-		-			-			-			2,554			914			3,468
Balance at September 30, 2024		23,448		$	234			-		$	-			1,205	$	(2,075	)	$	20,707		$	(2,022	)	$	12,451		$	246		$	29,541

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(In thousands)

	*Six months ended June 30, 2024*
	*As Previously Reported*			*Original Adjustment*			*Original As Restated*			*Adjustment*			*Restated*
Cash flows from operating activities:
Net income (loss)	$	11,255		$	(7,518	)	$	3,737		$	-		$	3,737
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Depreciation and amortization		989			-			989			(63	)		926
Amortization of operating lease right-of-use assets		310			-			310			-			310
Provision for expected credit losses		89			-			89			-			89
Deferred income tax expense		1,349			-			1,349			-			1,349
(Gain) loss on sale of business		(12,076	)		7,518			(4,558	)		(1,188	)		(5,746	)
Share-based compensation		256			-			256			-			256
Changes in operating assets and liabilities:
Accounts receivable, net		(9,766	)		-			(9,766	)		3,567			(6,199	)
Prepaid expenses and other current assets		(2,620	)		-			(2,620	)		2,791			171
Change in deferred taxes due to deconsolidation		2,307			-			2,307			-			2,307
Accounts payable		1,992			-			1,992			501			2,493
Operating lease liabilities		(310	)		-			(310	)		-			(310	)
Accrued expenses, other current liabilities, due to affiliates and customer incentives and deposits		6,395			-			6,395			(5,182	)		1,213
Net cash provided by operating activities of continuing operations		170			-			170			426			596
Net cash used in operating activities of discontinued operations		-			-			-			(426	)		(426	)
Net cash provided by operating activities		170			-			170			-			170

Cash flows from investing activities
Proceeds from sale of joint ventures, net of cash transferred		11,743			-			11,743			(3,761	)		7,982
Purchases of property and equipment		(781	)		-			(781	)		10			(771	)
Net cash provided by (used in) investing activities of continuing operations		10,962			-			10,962			(3,751	)		7,211
Net cash provided by investing activities of discontinued operations		-			-			-			3,751			3,751
Net cash provided by investing activities		10,962			-			10,962			-			10,962

Cash flows from financing activities
Borrowings under line of credit		69,117			-			69,117			-			69,117
Repayments under line of credit		(64,044	)		-			(64,044	)		-			(64,044	)
Proceeds from term debt		26			-			26			-			26
Net cash settlement of stock options		-			-			-			-			-
Repurchases of common stock		(1,800	)		-			(1,800	)		-			(1,800	)
Payments of notes to seller		(1,843	)		-			(1,843	)		-			(1,843	)
Payments to acquire noncontrolling interests		(250	)		-			(250	)		-			(250	)
Dividend on noncontrolling interest		(1,315	)		-			(1,315	)		1,315			-
Net cash provided by (used in) financing activities of continuing operations		(109	)		-			(109	)		1,315			1,206
Net cash used in financing activities of discontinued operations		-			-			-			(1,315	)		(1,315	)
Net cash used in financing activities		(109	)		-			(109	)		-			(109	)

Effect of foreign exchange rate changes on cash		(48	)		-			(48	)		-			(48	)
Net change in cash, cash equivalents and restricted cash		10,976			-			10,976			-			10,976
Cash, cash equivalents at beginning of period		10,719			-			10,719			-			10,719
Cash, cash equivalents at end of period	$	21,695		$	-		$	21,695		$	-		$	21,695

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(In thousands)

Six months ended June 30, 2023

As Previously Reported

Adjustment

Restated

Cash flows from operating activities:

Net income

2,883

Adjustments to reconcile net income to net cash provided by operating activities

Depreciation and amortization

1,026

(85

)

941

Amortization of operating lease right-of-use assets

256

Provision for expected credit losses

Deferred income tax expense

111

2,107

2,218

Share-based compensation

134

Changes in operating assets and liabilities:

Accounts receivable, net

1,205

1,320

2,525

Prepaid expenses and other current assets

3,118

(5,260

)

(2,142

)

Accounts payable

(803

)

251

(552

)

Operating lease liabilities

(256

)

(256

)

Accrued expenses, other current liabilities, due to affiliates and customer incentives and deposits

(968

)

1,395

427

Net cash provided by (used in) operating activities of continuing operations

6,744

(272

)

6,472

Net cash provided by operating activities of discontinued operations

272

Net cash provided by operating activities

6,744

Cash flows from investing activities

Purchases of property and equipment

(717

)

(694

)

Net cash provided by (used in) investing activities of continuing operations

(717

)

(694

)

Net cash used in investing activities of discontinued operations

(23

)

(23

)

Net cash used in by investing activities

(717

)

(717

)

Cash flows from financing activities

Borrowings under line of credit

47,340

Repayments under line of credit

(50,003

)

(50,003

)

Payments to acquire noncontrolling interests

(473

)

(473

)

Dividend on noncontrolling interest

(1,196

)

1,196

Net cash provided by (used in) financing activities of continuing operations

(4,332

)

1,196

(3,136

)

Net cash used in financing activities of discontinued operations

(1,196

)

(1,196

)

Net cash used in financing activities

(4,332

)

(4,332

)

Effect of foreign exchange rate changes on cash

(124

)

(124

)

Net change in cash, cash equivalents and restricted cash

1,571

Cash, cash equivalents at beginning of period

9,345

Reclass to discontinued operations

(1,815

)

(1,815

)

Cash, cash equivalents at end of period

10,916

9,101

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(In thousands)

	*Nine months ended September 30, 2024*
	*As Previously Reported*			*Original Adjustment*			*Original As Restated*			*Adjustment*			*Restated*
Cash flows from operating activities:
Net income (loss)	$	11,024		$	(7,556	)	$	3,468		$	-		$	3,468
Adjustments to reconcile net income (loss) to net cash used in operating activities
Depreciation and amortization		1,443			-			1,443			(63	)		1,380
Amortization of operating lease right-of-use assets		415			-			415			-			415
Provision for expected credit losses		133			-			133			-			133
Deferred income tax expense		4,577			-			4,577			-			4,577
(Gain) / loss on sale of business		(11,154	)		7,556			(3,598	)		(1,188	)		(4,786	)
Share-based compensation		107			-			107			-			107
Changes in operating assets and liabilities:
Accounts receivable, net		(5,843	)		-			(5,843	)		3,567			(2,276	)
Prepaid expenses and other current assets		(2,383	)		-			(2,383	)		2,791			408
Accounts payable		3,832			-			3,832			501			4,333
Operating lease liabilities		(415	)		-			(415	)		-			(415	)
Accrued expenses, other current liabilities, due to affiliates and customer incentives and deposits		(2,466	)		-			(2,466	)		(5,182	)		(7,648	)
Net cash provided by (used in) operating activities of continuing operations		(730	)		-			(730	)		426			(304	)
Net cash used in operating activities of discontinued operations		-			-			-			(426	)		(426	)
Net cash used in operating activities		(730	)		-			(730	)		-			(730	)

Cash flows from investing activities
Proceeds from sale of joint ventures, net of cash transferred		10,436			-			10,436			(3,761	)		6,675
Purchases of property and equipment		(908	)		-			(908	)		10			(898	)
Net cash provided by (used in) investing activities of continuing operations		9,528			-			9,528			(3,751	)		5,777
Net cash provided by investing activities of discontinued operations		-			-			-			3,751			3,751
Net cash provided by investing activities		9,528			-			9,528			-			9,528

Cash flows from financing activities
Borrowings under line of credit		103,184			-			103,184			-			103,184
Repayments under line of credit		(97,782	)		-			(97,782	)		-			(97,782	)
Proceeds from term debt		16			-			16			-			16
Net cash settlement of stock options		-			-			-			-			-
Repurchases of common stock		(1,800	)		-			(1,800	)		-			(1,800	)
Payments of notes to seller		(1,843	)		-			(1,843	)		-			(1,843	)
Payments to acquire noncontrolling interests		(250	)		-			(250	)		-			(250	)
Dividend on noncontrolling interest		(1,315	)		-			(1,315	)		1,315			-
Net cash provided by financing activities of continuing operations		210			-			210			1,315			1,525
Net cash used in financing activities of discontinued operations		-			-			-			(1,315	)		(1,315	)
Net cash provided by financing activities		210			-			210			-			210

Effect of foreign exchange rate changes on cash		(75	)		-			(75	)		-			(75	)
Net change in cash, cash equivalents and restricted cash		8,933			-			8,933			-			8,933
Cash, cash equivalents at beginning of period		10,719			-			10,719			-			10,719
Cash, cash equivalents at end of period	$	19,652		$	-		$	19,652		$	-		$	19,652

SPAR Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(In thousands)

Nine months ended September 30, 2023

As Previously Reported

Adjustment

Restated

Cash flows from operating activities:

Net income

3,981

Adjustments to reconcile net income to net cash provided by operating activities

Depreciation and amortization

1,574

(136

)

1,438

Amortization of operating lease right-of-use assets

433

Provision for expected credit losses

138

Deferred income tax expense

(15

)

(623

)

(638

)

Share-based compensation

217

Changes in operating assets and liabilities:

Accounts receivable, net

(1,963

)

(15

)

(1,978

)

Prepaid expenses and other current assets

1,635

(3,265

)

(1,630

)

Accounts payable

409

275

684

Operating lease liabilities

(433

)

(433

)

Accrued expenses, other current liabilities, due to affiliates and customer incentives and deposits

(4,336

)

2,814

(1,522

)

Net cash provided by (used in) operating activities of continuing operations

1,640

(950

)

690

Net cash provided by operating activities of discontinued operations

950

Net cash provided by operating activities

1,640

Cash flows from investing activities

Purchases of property and equipment

(1,083

)

(1,037

)

Net cash provided by (used in) investing activities of continuing operations

(1,083

)

(1,037

)

Net cash used in investing activities of discontinued operations

(46

)

(46

)

Net cash used in investing activities

(1,083

)

(1,083

)

Cash flows from financing activities

Borrowings under line of credit

80,151

Repayments under line of credit

(79,520

)

(79,520

)

Payments to acquire noncontrolling interests

(473

)

(473

)

Dividend on noncontrolling interest

(1,674

)

1,247

(427

)

Net cash used in financing activities of continuing operations

(1,516

)

1,247

(269

)

Net cash used in financing activities of discontinued operations

(1,247

)

(1,247

)

Net cash used in financing activities

(1,516

)

(1,516

)

Effect of foreign exchange rate changes on cash

(426

)

(426

)

Net change in cash, cash equivalents and restricted cash

(1,385

)

(1,385

)

Cash, cash equivalents at beginning of period

9,345

Reclass to discontinued operations

(3,081

)

(3,081

)

Cash, cash equivalents at end of period

7,960

4,879