Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2023 | Nov. 01, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Great Elm Group, Inc. | |
Entity Central Index Key | 0001831096 | |
Current Fiscal Year End Date | --06-30 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 31,174,605 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-39832 | |
Entity Tax Identification Number | 85-3622015 | |
Entity Address, Address Line One | 800 South Street | |
Entity Address, Address Line Two | Suite 230 | |
Entity Address, City or Town | Waltham | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02453 | |
City Area Code | 617 | |
Local Phone Number | 375-3006 | |
Document Quarterly Report | true | |
Entity Incorporation, State or Country Code | DE | |
Entity Interactive Data Current | Yes | |
Document Transition Report | false | |
Common Stock | ||
Document Information [Line Items] | ||
Title of each class | Common Stock, par value $0.001 per share | |
Trading Symbol | GEG | |
Security Exchange Name | NASDAQ | |
7.25% Notes due 2027 | ||
Document Information [Line Items] | ||
Title of each class | 7.25% Notes due 2027 | |
Trading Symbol | GEGGL | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 41,077 | $ 60,165 |
Investments in marketable securities | 34,783 | 24,595 |
Investments, at fair value (cost $44,158 and $40.387, respectively) | 37,865 | 32,611 |
Prepaid and other current assets | 2,935 | 717 |
Real estate under development | 3,116 | 1,742 |
Total current assets | 123,849 | 123,138 |
Identifiable intangible assets, net | 11,839 | 12,115 |
Right of use assets | 411 | 497 |
Other assets | 143 | 143 |
Total assets | 136,242 | 135,893 |
Current liabilities: | ||
Accrued expenses and other current liabilities | 3,514 | 5,418 |
Current portion of lease liabilities | 356 | 359 |
Total current liabilities | 5,280 | 7,377 |
Lease liabilities, net of current portion | 50 | 142 |
Long term debt (face value $26,945) | 25,878 | 25,808 |
Convertible notes (face value $37,912 and $37,912, including $15,395 and $15,395 held by related parties, respectively) | 37,158 | 37,129 |
Other liabilities | 555 | 669 |
Total liabilities | 68,921 | 72,051 |
Commitments and Contingencies (Note 11) | ||
Stockholders' equity | ||
Preferred stock, $0.001 par value; 5,000,000 authorized and zero outstanding | ||
Common stock, $0.001 par value; 350,000,000 shares authorized and 31,174,605 shares issued and 29,868,909 outstanding at September 30, 2023; and 30,651,047 shares issued and 29,546,655 outstanding at June 30, 2023 | 30 | 30 |
Additional paid-in-capital | 3,316,083 | 3,315,378 |
Accumulated deficit | (3,248,792) | (3,251,566) |
Total stockholders' equity | 67,321 | 63,842 |
Total liabilities and stockholders' equity | 136,242 | 135,893 |
Nonrelated Party | ||
Current liabilities: | ||
Accounts payable | 182 | 191 |
Related Party | ||
Current assets: | ||
Receivables from managed funds | 4,073 | 3,308 |
Current liabilities: | ||
Accounts payable | $ 1,228 | 1,409 |
Related party payables, net of current portion | $ 926 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Statement of Financial Position [Abstract] | ||
Investments, cost basis | $ 44,158 | $ 40,387 |
Long term debt, face value | 26,945 | 26,945 |
Convertible notes, face value | 37,912 | 37,912 |
Convertible notes payable to related party non-current | $ 15,395 | $ 15,395 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 350,000,000 | 350,000,000 |
Common stock, shares issued | 31,174,605 | 30,651,047 |
Common stock, shares outstanding | 29,868,909 | 29,546,655 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Revenues | $ 3,310 | $ 1,860 |
Operating costs and expenses: | ||
Investment management expenses | 2,762 | 1,989 |
Depreciation and amortization | 283 | 294 |
Selling, general and administrative | 1,715 | 1,487 |
Expenses of Consolidated Fund | 46 | |
Total operating costs and expenses | 4,760 | 3,816 |
Operating loss | (1,450) | (1,956) |
Dividends and interest income | 1,986 | 1,473 |
Net realized and unrealized gain (loss) on investments | 3,284 | (6,797) |
Net realized and unrealized loss on investments of Consolidated Fund | (16) | |
Interest expense | (1,062) | (1,974) |
Income (loss) before income taxes from continuing operations | 2,758 | (9,270) |
Income tax expense | (233) | |
Net income (loss) from continuing operations | 2,758 | (9,503) |
Discontinued operations: | ||
Net income from discontinued operations | 16 | 964 |
Net income (loss) | 2,774 | (8,539) |
Less: net loss attributable to non-controlling interest, continuing operations | (1,572) | |
Less: net income attributable to non-controlling interest, discontinued operations | 1,324 | |
Net income (loss) attributable to Great Elm Group, Inc. | $ 2,774 | $ (8,291) |
Basic net income (loss) per share from: | ||
Continuing operations | $ 0.09 | $ (0.28) |
Discontinued operations | (0.01) | |
Basic net income (loss) per share | 0.09 | (0.29) |
Diluted net income (loss) per share from: | ||
Continuing operations | 0.08 | (0.28) |
Discontinued operations | (0.01) | |
Diluted net income (loss) per share | $ 0.08 | $ (0.29) |
Weighted average shares outstanding | ||
Basic | 29,579 | 28,543 |
Diluted | 41,860 | 28,543 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Stockholders' Equity and Contingently Redeemable Non-controlling Interest (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Great Elm Group Inc. Stockholders' Equity | Non-controlling Interest |
Beginning balance at Jun. 30, 2022 | $ 40,029 | $ 29 | $ 3,312,763 | $ (3,279,296) | $ 33,496 | $ 6,533 |
Beginning balance (in shares) at Jun. 30, 2022 | 28,507,000 | |||||
Beginning balance, Contingently redeemable non-controlling interest at Jun. 30, 2022 | 2,225 | |||||
Net (loss) income | (9,201) | (8,291) | (8,291) | (910) | ||
Net (loss) income, Contingently redeemable non-controlling interest | 662 | |||||
Distributions to non-controlling interests in Consolidated Fund | (634) | (634) | ||||
Issuance of common stock related to vesting of restricted stock (in shares) | 267,000 | |||||
Stock-based compensation | 834 | 834 | 834 | |||
Ending balance at Sep. 30, 2022 | 31,028 | $ 29 | 3,313,597 | (3,287,587) | $ 26,039 | $ 4,989 |
Ending balance (in shares) at Sep. 30, 2022 | 28,774,000 | |||||
Ending balance, Contingently redeemable non-controlling interest at Sep. 30, 2022 | 2,887 | |||||
Beginning balance at Jun. 30, 2023 | $ 63,842 | $ 30 | 3,315,378 | (3,251,566) | ||
Beginning balance (in shares) at Jun. 30, 2023 | 29,546,655 | 29,547,000 | ||||
Net (loss) income | $ 2,774 | 2,774 | ||||
Issuance of common stock related to vesting of restricted stock (in shares) | 322,000 | |||||
Stock-based compensation | 705 | 705 | ||||
Ending balance at Sep. 30, 2023 | $ 67,321 | $ 30 | $ 3,316,083 | $ (3,248,792) | ||
Ending balance (in shares) at Sep. 30, 2023 | 29,868,909 | 29,869,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net income (loss) from continuing operations | $ 2,758 | $ (9,503) |
Adjustments to reconcile net income (loss) to net cash from operating activities: | ||
Depreciation and amortization | 283 | 294 |
Stock-based compensation | 705 | 834 |
Sales of investments by Consolidated Fund | 1,558 | |
Realized loss on investments from Consolidated Fund | 16 | |
Unrealized (gain) loss on investments | (3,372) | 1,182 |
Realized loss on investments | 88 | 5,615 |
Non-cash interest and amortization of capitalized issuance costs | 573 | 128 |
Change in fair value of contingent consideration | 18 | (70) |
Other non-cash (income) expense, net | (207) | 158 |
Changes in operating assets and liabilities: | ||
Receivables from managed funds | (765) | (133) |
Prepaid and other assets | (2,218) | 401 |
Real estate under development | (1,408) | |
Operating leases | (8) | (1) |
Related party payables | (1,125) | (413) |
Accounts payable, accrued expenses and other liabilities | (1,448) | (847) |
Net cash used in provided by operating activities - continuing operations | (6,126) | (781) |
Net cash provided by operating activities - discontinued operations | 2,805 | |
Net cash (used in) provided by operating activities | (6,126) | 2,024 |
Cash flows from investing activities: | ||
Purchases of investments in held-to-maturity securities | (9,801) | |
Purchases of investments in trading securities | (4,476) | |
Sales of investments | 1,793 | |
Other | (118) | (11) |
Net cash used in investing activities - continuing operations | (12,602) | (11) |
Net cash used in investing activities - discontinued operations | (360) | (2,259) |
Net cash used in investing activities | (12,962) | (2,270) |
Cash flows from financing activities: | ||
Distributions to non-controlling interests in consolidated fund | (634) | |
Net cash used in financing activities - continuing operations | (634) | |
Net cash provided by financing activities - discontinued operations | 550 | |
Net cash used in financing activities | (84) | |
Net decrease in cash and cash equivalents, including cash and cash equivalents classified within current assets held for sale | (19,088) | (330) |
Less: net increase in cash and cash equivalents classified within current assets held for sale | 1,096 | |
Plus: cash received from discontinued operations | 1,694 | |
Net (decrease) increase in cash and cash equivalents | (19,088) | 268 |
Cash and cash equivalents at beginning of period | 60,165 | 22,281 |
Cash and cash equivalents at end of period | 41,077 | 22,549 |
Cash paid for interest | $ 488 | 1,345 |
Non-cash investing and financing activities | ||
Lease liabilities and right of use assets arising from operating leases | 167 | |
Partial settlement of Seller Note in exchange for GECC stock | 609 | |
Non-cash distributions received from Consolidated Fund | $ 177 |
Organization
Organization | 3 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization Great Elm Group, Inc. (referred to as the Company or GEG ) is an alternative asset management company incorporated in Delaware. The Company focuses on growing a scalable and diversified portfolio of long-duration and permanent capital vehicles across credit, real estate, specialty finance, and other alternative strategies. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, including Great Elm Capital Management, Inc. ( GECM ), Great Elm Opportunities GP, Inc. ( GEO GP ), Great Elm Capital GP, LLC, Great Elm FM Acquisition, Inc., Great Elm DME Holdings, Inc., Great Elm DME Manager, LLC, and Monomoy BTS Corporation ( MBTS ), Great Elm Investments LLC, as well as its majority-owned subsidiaries Forest Investments, Inc. (through December 30, 2022), and Great Elm Healthcare, LLC ( HC LLC ) and its wholly-owned subsidiaries (through January 3, 2023). In addition, we have determined that the Company was the primary beneficiary of certain variable interest entities, and therefore the operations of those entities have been included in our consolidated results for the relevant periods. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions for Form 10-Q and, therefore, do not include all information and footnotes that are normally included in the Company’s Form 10-K and should be read in conjunction with the audited consolidated financial statements and notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023. These financial statements reflect all adjustments (consisting of normal and recurring items or items discussed herein) that management believes are necessary to fairly state results for the interim periods presented. Results of operations for interim periods are not necessarily indicative of annual results of operations. The historical results of the Durable Medical Equipment ( DME ) business, primarily consisting of HC LLC and its subsidiaries, sold on January 3, 2023 and related activity have been presented in the accompanying unaudited condensed consolidated statements of operations and cash flows for the three months ended September 30, 2022 as discontinued operations. Further, the historical segment information was recast to reflect our ongoing business as a single reportable segment and to remove the activity of discontinued operations. Unless otherwise specified, disclosures in these condensed consolidated financial statements reflect continuing operations only. Certain prior period amounts have been reclassified to conform to current period presentation. Use of Estimates The preparation of these financial statements in accordance with accounting principles generally accepted in the United States of America ( US GAAP ) requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. On an on-going basis, the Company evaluates all of these estimates and assumptions. The most important of these estimates and assumptions relate to revenue recognition, valuation allowance for deferred tax assets, estimates associated with accounting for asset acquisitions, and fair value measurements, including stock-based compensation. Although these and other estimates and assumptions are based on the best available information, actual results could be different from these estimates. Principles of Consolidation The Company consolidates the assets, liabilities, and operating results of its wholly-owned subsidiaries, majority-owned subsidiaries, and subsidiaries in which we hold a controlling financial interest as of the financial statement date. In most cases, a controlling financial interest reflects ownership of a majority of the voting interests. We consolidate a variable interest entity ( VIE ) when we possess both the power to direct the activities of the VIE that most significantly impact its economic performance and the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to the VIE. All intercompany accounts and transactions have been eliminated in consolidation. Non-controlling interests in the Company’s subsidiaries are reported as a component of equity, separate from the parent company’s equity or outside of permanent equity for non-controlling interests that are contingently redeemable. Results of operations attributable to the non-controlling interests are included in the Company’s consolidated statements of operations. Cash and Cash Equivalents Cash and cash equivalents are comprised of cash and highly liquid investments with original maturities of 90 days or less at the date of purchase. Cash equivalents consist primarily of exchange-traded money market funds and U.S. treasury bills. The Company is exposed to credit risk in the event of default by the financial institutions or the issuers of these investments to the extent the amounts on deposit or invested are in excess of amounts that are insured. Investments in Marketable Securities Investments in marketable securities consist of U.S. treasury bills with original maturity exceeding 90 days. The Company classifies investments in debt securities as either trading, held-to-maturity, or available-for-sale. Securities are classified as trading if they are purchased and held principally for the purpose of selling in the near term and as held-to-maturity when the Company has both the positive intent and ability to hold the security to maturity. Investments in debt securities not classified as either trading or held-to-maturity are classified as available-for-sale securities. Trading securities are measured at fair value with unrealized gains and losses reported within net realized and unrealized gain (loss) on investments. Held-to-maturity securities are measured at amortized cost with realized gains and losses reported within net realized and unrealized gain (loss) on investments. Available-for-sale securities are measured at fair value with unrealized gains and losses reported in accumulated other comprehensive income (loss). As of September 30, 2023, all investments in marketable securities were classified as held-to-maturity and had original maturities (at the time of purchase) exceeding 90 days. As of September 30, 2023 , the amortized cost basis for these securities approximated their fair value. Investments, at Fair Value Investments, at fair value, consist of equity and equity-related securities and debt securities classified as trading carried at fair value, as well as investments in private funds measured using the net asset value ( NAV ) as reported by each fund’s investment manager. The private funds calculate NAV in a manner consistent with the measurement principles of the Financial Accounting Standards Board ( FASB ) Accounting Standards Codification ( ASC ) Topic 946, Financial Services – Investment Companies , as of the valuation date. Changes in the fair value and NAV are recorded within net realized and unrealized gain (loss) on investments. Dividends received are recorded within dividends and interest income on the consolidated statements of operations. Real Estate under Development Real estate under development is classified as follows: (i) real estate under development (current), which includes real estate projects that are in the process of being developed and expected to be completed and disposed of within one year of the balance sheet date; (ii) real estate under development (non-current), which includes real estate projects that are in the process of being developed and expected to be completed and disposed of more than one year from the balance sheet date; and (iii) real estate held for sale, which includes land and completed improvements thereon that meet all of the “held for sale” criteria. Real estate under development is carried at cost less impairment, if applicable. We capitalize costs that are directly identifiable with the specific real estate projects, including pre-acquisition and pre-construction costs, development and construction costs, taxes, and insurance. We do not capitalize any general and administrative or overhead costs, regardless of whether the costs are internal or paid to third parties. Capitalization begins when the activities related to development have begun and ceases when activities are substantially complete and the asset is available for occupancy. Real estate held for sale is recorded at the lower of cost or fair value less cost to sell. If an asset’s fair value less cost to sell, based on discounted future cash flows, management estimates or market comparisons, is less than its carrying amount, an allowance is recorded against the asset. Impairment of Long-Lived Assets Long-lived assets include real estate under development, property and equipment, definite-lived intangible assets, and lease right-of-use assets. The Company evaluates the recoverability of long-lived assets whenever events or changes in circumstances indicate that their carrying value may not be recoverable based on undiscounted cash flows. Impairment losses are recorded when undiscounted cash flows estimated to be generated by an asset are less than the asset’s carrying amount. The amount of the impairment loss, if any, is calculated as the excess of the asset’s carrying value over its fair value, which is determined using a discounted cash flow analysis, management estimates or market comparisons. Earnings per Share The following table presents the calculation of basic and diluted net income (loss) per share: For the three months ended September 30, (in thousands except per share amounts) 2023 2022 Numerator: Net income (loss) from continuing operations $ 2,758 $ ( 9,503 ) Less: net loss attributable to non-controlling interest, continuing operations - ( 1,572 ) Numerator for basic EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc. $ 2,758 $ ( 7,931 ) Net income from discontinued operations 16 964 Less: net income attributable to non-controlling interest, discontinued operations - 1,324 Numerator for basic EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. $ 16 $ ( 360 ) Effect of dilutive securities: Interest expense associated with Convertible Notes, continuing operations $ 503 $ - Numerator for diluted EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc., after the effect of dilutive securities $ 3,261 $ ( 7,931 ) Numerator for diluted EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. $ 16 $ ( 360 ) Denominator: Denominator for basic EPS - Weighted average shares of common stock outstanding 29,579 28,543 Effect of dilutive securities: Restricted stock 1,363 - Convertible Notes 10,918 - Denominator for diluted EPS - Weighted average shares of common stock outstanding after the effect of dilutive securities 41,860 28,543 Basic net income (loss) per share from: Continuing operations $ 0.09 $ ( 0.28 ) Discontinued operations - ( 0.01 ) Basic net income (loss) per share $ 0.09 $ ( 0.29 ) Diluted net income (loss) per share from: Continuing operations $ 0.08 $ ( 0.28 ) Discontinued operations $ - ( 0.01 ) Diluted net income (loss) per share $ 0.08 $ ( 0.29 ) As of September 30, 2023, the Company had 3,264,424 potential shares of common stock issuable upon the exercise of stock options that are not included in the diluted net income (loss) per share calculation because to do so would be anti-dilutive for the three months ended September 30, 2023. As of September 30, 2022, the Company had 10,392,545 potential shares of common stock issuable upon the conversion of Convertible Notes (as defined below), 1,527,130 potential shares of common stock issuable upon the exercise of stock options, and 1,330,273 potential shares issuable upon vesting of restricted stock units and restricted stock awards that are not included in the diluted net income (loss) per share calculation for the three months ended September 30, 2022 because to do so would be anti-dilutive. As of September 30, 2023 and 2022 , the Company had an aggregate of 1,362,723 and 1,303,386 issued shares, respectively, that are not considered outstanding for accounting purposes since they are unvested and subject to forfeiture by the employees at a nominal price if service milestones are not met. Recently Issued Accounting Standards Current Expected Credit Losses. In June 2016, the FASB issued Accounting Standards Update ( ASU ) 2016-13, Financial Instruments – Credit Losses (Topic 326) , which changes the impairment model for financial instruments, including trade receivables from an incurred loss method to a new forward looking approach, based on expected losses. The estimate of expected credit losses will require entities to incorporate considerations of historical experience, current information and reasonable and supportable forecasts. The amendments in this ASU are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted this ASU as of July 1, 2023 , which did not have a material impact on its consolidated financial statements. |
Revenue
Revenue | 3 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 3. Revenue The revenues from each major source are summarized in the following table: For the three months ended September 30, (in thousands) 2023 2022 Management fees $ 1,424 $ 1,302 Incentive fees 1,264 - Property management fees 282 274 Administration and service fees 340 284 Total revenues $ 3,310 $ 1,860 The Company recognizes investment management revenue at amounts that reflect the consideration to which it expects to be entitled in exchange for providing services to its customers. Investment management revenue primarily consists of fees based on a percentage of assets under management, fees based on the performance of managed assets, and administration and service fees. Fees are based on agreements with each investment product and may be terminated at any time by either party subject to the specific terms of each respective agreement. Management Fees The Company earns management fees based on the investment management agreements GECM has with Great Elm Capital Corp. ( GECC ), Monomoy Properties UpREIT, LLC, the operating partnership of Monomoy Properties REIT, LLC ( Monomoy UpREIT ) and other private funds managed by GECM (collectively, the Funds ). The performance obligation is satisfied and management fee revenue is recognized over time as the services are rendered, since the Funds simultaneously receive and consume the benefits provided as GECM performs services. Management fee rates range from 1.0 % to 1.5 % of the management fee assets specified within each agreement and are calculated and billed in arrears of the period, either monthly or quarterly. Property Management Fees Under the Monomoy UpREIT investment management agreement, GECM is also entitled to 4.0 % of rent collected. These fees are collected monthly in arrears. Property management fee revenue is recognized over time as the services are provided. Incentive Fees The Company earns incentive fees based on the investment management agreements GECM has with GECC and Monomoy Properties II, LLC ( MP II ), a feeder fund of Monomoy Properties REIT, LLC. Where an investment management agreement includes both management fees and incentive fees, the performance obligation is considered to be a single obligation for both fees. Incentive fees are variable consideration associated with the investment management agreements. Incentive fees are earned based on investment performance during the period, subject to the achievement of minimum return levels or high-water marks, in accordance with the terms of the respective investment management agreements. Incentive fees are typically 20 % of the performance-based metric specified within each agreement. Incentive fees are recognized when it is determined that they are no longer probable of significant reversal. During the three months ended September 30, 2023 , the Company recorded revenue in respect to the incentive fees due from GECC of $ 1.3 million. Administration and Service Fees The Company earns administration fees based on the administration agreement GECM has with GECC whereby the investment vehicles reimburse GECM for costs incurred in performing certain administrative functions. This revenue is recognized over time as the services are performed. Administration fees are billed quarterly in arrears, which is consistent with the timing of the delivery of services and reflect agreed upon rates for the services provided. The services are accounted for as a single performance obligation for each investment vehicle that is a series of distinct services with substantially the same pattern of transfer as the services are provided on a daily basis. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 4. Related Party Transactions Related party transactions are measured in part by the amount of consideration paid or received as established and agreed by the parties. Consideration paid for such services in each case is the negotiated value. The following tables summarize activity and outstanding balances between the managed investment products and the Company: For the three months ended September 30, (in thousands) 2023 2022 Net realized and unrealized gain (loss) on investments $ 3,362 $ ( 6,797 ) Net realized and unrealized loss on investments of Consolidated Fund - ( 16 ) Dividend income 836 1,380 (in thousands) September 30, 2023 June 30, 2023 Dividends receivable $ 300 $ 300 Investment management revenues receivable 2,779 2,167 Receivable for reimbursable expenses paid 994 841 Receivables from managed funds $ 4,073 $ 3,308 Investment Management GECM has agreements to manage the investment portfolios for GECC, Monomoy UpREIT and other investment products, as well as to provide administrative services. Under these agreements, GECM receives management fees based on the managed assets (other than cash and cash equivalents) and rent collected, incentive fees based on the performance of those assets, and administration and service fees. See Note 3 - Revenue for additional discussions of the fee arrangements. Consolidated Funds GEO GP serves as the general partner of Great Elm Opportunities Fund I, LP ( GEOF ), a Delaware multi-series limited partnership. GECM serves as the investment manager of GEOF. As the general partner, GEO GP provides administrative services and oversees GECM’s management of the investment portfolio of GEOF. The Company determined that GEOF and Series A of GEOF are VIEs, and that the criteria for consolidation were not met for either entity. GEOF Series D was launched on January 1, 2023 and the Company determined that it was not a VIE. The contribution in the amount of $ 3.0 million made by GEG into GEOF Series D, representing 43 % ownership of the partnership interests in the fund, was determined to be an equity method investment and the Company elected the fair value option using the net asset value ( NAV ) practical expedient for this instrument with all changes in NAV reported in net realized and unrealized gain (loss) on investments on the consolidated statements of operations. GECM also served as the managing member of Great Elm SPAC Opportunity Fund, LLC ( GESOF or the Consolidated Fund ), a Delaware limited liability company, which was launched in February 2021, and managed the investment portfolio of GESOF. The Company determined that GESOF was a VIE and that the criteria for consolidation were met during the three months ended September 30, 2022. The operations of the Consolidated Fund were included in our consolidated financial statements. In July 2022, GESOF began to wind down and the Company received final distributions of cash and equity investments (in-kind) during the three months ended September 30, 2022. The Company retained the specialized investment company accounting guidance under US GAAP with respect to the Consolidated Fund during the periods it was consolidated. As such, investments of the Consolidated Fund were included in the consolidated balance sheets at fair value and the net realized and unrealized gain or loss on those investments was included as a component of other income on the consolidated statements of operations. Non-controlling interests in the Consolidated Fund were included in net loss attributable to non-controlling interest, continuing operations. There are no consolidated funds as of September 30, 2023. See Note 2 - Summary of Significant Accounting Policies for additional details. Investments The Company owns 1,493,560 shares of GECC (approximately 19.6 % of the outstanding shares). Certain officers and directors of GECC are also officers and directors of GEG. Matthew A. Drapkin is a director of our Board of Directors and also the Chairman of GECC's Board of Directors, Adam M. Kleinman is our President, as well as the Chief Compliance Officer of GECC, Matt Kaplan is the President of GECM, as well as the President and Chief Operating Officer of GECC, and Keri A. Davis is our Chief Financial Officer and Chief Accounting Officer, as well as the Chief Financial Officer of GECC. The Company receives dividends from its investments in GECC and Monomoy UpREIT and earns unrealized gains and losses based on the mark-to-market performance of those investments. See Note 5 - Fair Value Measurements. Other Transactions GECM has shared personnel and reimbursement agreements with Imperial Capital Asset Management, LLC ( ICAM ). Jason W. Reese, the Chief Executive Officer and Chairman of the Company’s Board of Directors, is the Chief Executive Officer of ICAM, and Matt Kaplan is also a Managing Director of ICAM. Certain costs incurred under these agreements relate to human resources, investment management, and other administrative services provided by ICAM employees, for the benefit of the Company and its subsidiaries, and are included in investment management expenses in the consolidated statements of operations. For the three months ended September 30, 2023 and 2022, such costs were $ 0.2 million and $ 0.4 million, respectively. Other costs include operational or administrative services performed on behalf of the funds managed by GECM and are included in receivables from managed funds in the consolidated balance sheets. As of September 30, 2023 and June 30, 2023 , costs of $ 0.4 million and $ 0.1 million, respectively, related to the shared services agreements were included in receivables from managed funds. On August 31, 2021, the Company entered into a financial advisory agreement with Imperial Capital, LLC. The agreement included a retainer fee of $ 0.1 million which was paid in October 2021. In addition, the agreement included a success-based fee upon a sale of HC LLC. Upon completion of the sale of HC LLC on January 3, 2023, a success fee of $ 0.7 million was paid to Imperial Capital, LLC. Jason W. Reese is the Co-Founder of Imperial Capital, LLC. See Note 5 - Fair Value Measurements for details on the contingent consideration payable to ICAM following the acquisition of the Monomoy UpREIT investment management agreement and Note 8 - Convertible Notes for details on the Convertible Notes issued to related parties. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 5. Fair Value Measurements Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. US GAAP provides a framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: ▪ Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. ▪ Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. ▪ Level 3: Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. All financial assets or liabilities that are measured at fair value on a recurring and non-recurring basis have been segregated into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date. The assets and liabilities measured at fair value on a recurring and no n-recurring basis are summarized in the tables below: Fair Value as of September 30, 2023 (in thousands) Level 1 Level 2 Level 3 Total Assets: Equity investments $ 14,821 $ - $ - $ 14,821 Debt securities 4,522 - - 4,522 Total assets within the fair value hierarchy $ 19,343 $ - $ - $ 19,343 Investments valued at net asset value $ 18,522 Total assets $ 37,865 Liabilities: Contingent consideration liability $ - $ - $ 944 $ 944 Total liabilities $ - $ - $ 944 $ 944 Fair Value as of June 30, 2023 (in thousands) Level 1 Level 2 Level 3 Total Assets: Equity investments $ 14,296 $ - $ - $ 14,296 Total assets within the fair value hierarchy $ 14,296 $ - $ - $ 14,296 Investments valued at net asset value $ 18,315 Total assets $ 32,611 Liabilities: Contingent consideration liability $ - $ - $ 1,903 $ 1,903 Total liabilities $ - $ - $ 1,903 $ 1,903 There were no transfers between levels of the fair value hierarchy during the three months ended September 30, 2 0 23 and 2 0 22 . The following is a reconciliation of changes in contingent consideration, a Level 3 liability: For the three months ended September 30, (in thousands) 2023 2022 Beginning balance $ 1,903 $ 1,120 Payments ( 977 ) - Change in fair value 18 ( 70 ) Ending balance $ 944 $ 1,050 The valuation techniques applied to investments held by the Company and by the Consolidated Fund varied depending on the nature of the investment. Equity and equity-related securities Securities traded on a national securities exchange are stated at the close price on the valuation date. To the extent these securities are actively traded and valuation adjustments are no t applied, they are classified as Level 1. Investments in private funds The Company values investments in private funds using NAV as reported by each fund’s investment manager. The private funds calculate NAV in a manner consistent with the measurement principles of FASB ASC Topic 946, Financial Services – Investment Companies , as of the valuation date. Investments valued using NAV as a practical expedient are not categorized within the fair value hierarchy. As of September 30, 2023 and June 30, 2023 , investments in private funds primarily consisted of our investment in Monomoy UpREIT and GEOF Series D. Monomoy UpREIT allows redemptions annually with 90 days’ notice, subject to a one-year lockup from the date of initial investment, which are capped at 5 % of its NAV. GEOF Series D allows withdrawals annually and there is no set duration for the private fund. Contingent consideration In conjunction with the acquisition of the Monomoy UpREIT investment management agreement, the Company entered into a contingent consideration agreement that requires the Company to pay up to $ 2.0 million to ICAM if certain fee revenue thresholds are achieved during fiscal years ending June 30, 2023 and 2024. As of June 30, 2023, the Company determined that the fee revenue threshold for the year ending June 30, 2023 was achieved and the amount payable to ICAM was approximately $ 1.0 million, which was paid in July 2023. Further, the Company determined that the fee revenue threshold for the year ending June 30, 2024 was expected to be achieved as well, and the related amount payable to ICAM was recorded at present value of approximately $ 0.9 million, using a discount rate of 8.0 %, included within the current portion of related party payables in the condensed consolidated balance sheet as of September 30, 2023. As of June 30, 2023 , the contingent consideration of $ 1.9 million was included within the current portion of related party payables and related party payables, net of current portion, in the condensed consolidated balance sheet. See Note 7 - Long-Term Debt for additional discussion related to the fair value of our notes payable and other long-term debt. The carrying value of all other financial assets and liabilities approximate their fair values. As of September 30, 2023, we had $ 2.3 million of unfunded binding commitments to make additional investments. |
Real Estate Under Development
Real Estate Under Development | 3 Months Ended |
Sep. 30, 2023 | |
Real Estate [Abstract] | |
Real Estate Under Development | 6. Real Estate Under Development In January 2023, MBTS completed purchases of certain land parcels located in Mississippi and Florida. Contemporaneously with the land purchases, MBTS entered into commercial lease agreements, as a lessor, in respect to the land parcels and build-to-suit improvements to be constructed thereon. The leases will commence upon substantial completion of the build-to-suit development, which is expected not later than the second calendar quarter of 2024. We intend to sell the land and improvements with the attached leases at or close to the respective lease commencement date. During the three months ended September 30, 2023, the Company capitalized costs of $ 1.4 million within real estate under development (current) on its condensed consolidated balance sheet, representing the development and construction costs directly identifiable with the two real estate projects. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 7. Long-Term Debt The Company’s long-term debt is summarized in the following table: (in thousands) Borrower September 30, 2023 June 30, 2023 GEGGL Notes GEG $ 26,945 $ 26,945 Total principal $ 26,945 $ 26,945 Unamortized debt discounts and issuance costs ( 1,067 ) ( 1,137 ) Long-term debt 25,878 25,808 During the three months ended September 30, 2023, the Company incurred interest expense of $ 0.6 million attributed to its long-term debt. During the three months ended September 30, 2022, the Company incurred interest expense of $ 0.7 million on long-term debt, as well as certain related-party notes payable fully repaid during the year ended June 30, 2023. See Note 8 - Convertible Notes for interest expense on Convertible Notes. Additional details of the Company's long-term debt are discussed below. GEGGL Notes On June 9, 2022, we issued $ 26.9 million in aggregate principal amount of 7.25 % notes due on June 30, 2027 (the GEGGL Notes ), which included $ 1.9 million of GEGGL Notes issued in connection with the partial exercise of the underwriters’ over-allotment option. The GEGGL Notes are unsecured obligations and rank: (i) pari passu, or equal, with the Convertible Notes (as defined below) and any future outstanding unsecured unsubordinated indebtedness; (ii) senior to any of our indebtedness that expressly provides it is subordinated to the GEGGL Notes; (iii) effectively subordinated to any future secured indebtedness; and (iv) structurally subordinated to any future indebtedness and other obligations of any of our current and future subsidiaries. We pay interest on the GEGGL Notes on March 31, June 30, September 30 and December 31 of each year. The GEGGL Notes can be called on, or after, June 30, 2024. Holders of the GEGGL Notes do not have the option to have the notes repaid prior to the stated maturity date. The GEGGL Notes were issued in minimum denominations of $ 25 and integral multiples of $ 25 in excess thereof. The GEGGL Notes include covenants that limit additional indebtedness or the payment of dividends subject to compliance with a net consolidated debt to equity ratio of 2 :1 . As of September 30, 2023, our net consolidated debt to equity ratio is 0.35 :1.00. |
Convertible Notes
Convertible Notes | 3 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Convertible Notes | 8. Convertible Notes As of September 30, 2023 and June 30, 2023 , the total outstanding principal balance of convertible notes due on February 26, 2030 (the Convertible Notes ) was $ 37.9 million , including cumulative interest paid in-kind. The Convertible Notes are held by a consortium of investors, including $ 15.4 million issued to certain related parties as of September 30, 2023. The Convertible Notes accrue interest at 5.0 % per annum, payable semiannually in arrears on June 30 and December 31, commencing June 30, 2020, in cash or in kind at the option of the Company. Each $1,000 principal amount of the Convertible Notes are convertible into 288.0018 shares of the Company’s common stock, subject to the terms therein, prior to maturity at the option of the holder. The Company may, subject to compliance with the terms of the Convertible Notes, effect the conversion of some or all of the Convertible Notes into shares of common stock, subject to certain liquidity and pricing requirements, as specified in the Convertible Notes. The embedded conversion feature in the Convertible Notes qualifies for the scope exception to derivative accounting in FASB ASC Topic 815, Derivatives and Hedging, for certain contracts involving a reporting entity’s own equity. The Company incurred $ 1.2 million in issuance costs on the original issuance. The debt issuance costs are being amortized over the 10 -year term and are netted with the principal balance on our condensed consolidated balance sheets. As of September 30, 2023 and June 30, 2023, the remaining balance of unamortized debt issuance costs was $ 0.8 million and $ 0.8 million , respectively. During the three months ended September 30, 2023, the Company incurred interest expense of $ 0.5 million related to the Convertible Notes, inclusive of non-cash interest related to amortization of debt issuance costs. During the three months ended September 30, 2022, the Company incurred interest expense of $ 0.5 million related to the Convertible Notes, inclusive of non-cash interest related to amortization of debt issuance costs. |
Share-Based and Other Non-Cash
Share-Based and Other Non-Cash Compensation | 3 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based and Other Non-Cash Compensation | 9. Share-Based and Other Non-Cash Compensation Restricted Stock Awards and Restricted Stock Units The following table presents activity related to the Company’s restricted stock awards and restricted stock units for the three months ended September 30, 2023: Restricted Stock Awards and Restricted Stock Units Shares (in thousands) Weighted Average Grant Date Fair Value Outstanding at June 30, 2023 1,322 $ 1.93 Granted 532 2.07 Vested ( 322 ) 2.20 Forfeited - - Outstanding at September 30, 2023 1,532 $ 1.93 Restricted stock awards and restricted stock units have vesting terms between 1 - 4 years and are subject to service requirements. During the three months ended September 30, 2023, the Company granted 531,642 restricted stock awards and did no t grant any shares of restricted stock units . Stock Options The following table presents activity related to the Company’s stock options for the three months ended September 30, 2023: Stock Options Shares (in thousands) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at June 30, 2023 3,264 $ 2.70 7.45 $ - Options granted - - - - Forfeited, cancelled or expired - - - - Outstanding at September 30, 2023 3,264 $ 2.70 7.20 $ - Exercisable at September 30, 2023 1,260 $ 3.72 3.38 $ - Stock-Based Compensation Expense Stock-based compensation expense related to all restricted stock awards, restricted stock units, and stock options totaled $ 0.7 million and $ 0.8 million for the three months ended September 30, 2023 and 2022, respectively. As of September 30, 2023, the Company had unrecognized compensation costs related to all unvested restricted stock awards and stock options totaling $ 2.7 million . Non-Employee Director Deferred Compensation Plan In December 2020, the Company established the Great Elm Group, Inc. Non-Employee Directors Deferred Compensation Plan allowing non-employee directors to defer their cash and/or equity compensation under a non-revocable election for each calendar year. Such compensation is deferred until the earlier of 3 years from the original grant date of such compensation, termination of service, or death, and is payable in common stock shares. As of September 30, 2023, there were 167,939 restricted stock awards and restricted stock units that were deferred under this plan (and thus included in the number of restricted stock awards and restricted stock units outstanding as of that date) . Other Non-Cash Compensation During the three months ended September 30, 2023, the Company issued compensation to certain employees in the form of GECC common shares to be settled with GECC shares currently held by the Company. The total value of GECC shares awarded for the three months ended September 30, 2023 was $ 0.6 million, of which $ 0.1 million vested immediately, and the balance will vest annually pro-rata over two - and three-year periods. Related compensation expense was $ 0.1 million for the three months ended September 30, 2023 . |
Income Taxes
Income Taxes | 3 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. Income Taxes As of June 30, 2023, the Company had net operating loss ( NOL ) carryforwards for federal income tax purposes of approximately $ 16.2 million, of which approximately $ 8.2 million will expire in fiscal years 2024 through 2025 and $ 8.0 million can be carried forward indefinitely. As of June 30, 2023, the Company also had $ 25.5 million of state NOL carryforwards, principally in Massachusetts, Arizona, and Nebraska, that will expire from 2031 to 2043 . |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies From time to time, the Company is involved in lawsuits, claims, investigations and proceedings that arise in the ordinary course of business. The Company maintains insurance to mitigate losses related to certain risks. The Company is not a named party in any other pending or threatened litigation that we expect to have a material adverse impact on our business, results of operations, financial condition or cash flows. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions for Form 10-Q and, therefore, do not include all information and footnotes that are normally included in the Company’s Form 10-K and should be read in conjunction with the audited consolidated financial statements and notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023. These financial statements reflect all adjustments (consisting of normal and recurring items or items discussed herein) that management believes are necessary to fairly state results for the interim periods presented. Results of operations for interim periods are not necessarily indicative of annual results of operations. The historical results of the Durable Medical Equipment ( DME ) business, primarily consisting of HC LLC and its subsidiaries, sold on January 3, 2023 and related activity have been presented in the accompanying unaudited condensed consolidated statements of operations and cash flows for the three months ended September 30, 2022 as discontinued operations. Further, the historical segment information was recast to reflect our ongoing business as a single reportable segment and to remove the activity of discontinued operations. Unless otherwise specified, disclosures in these condensed consolidated financial statements reflect continuing operations only. Certain prior period amounts have been reclassified to conform to current period presentation. |
Use of Estimates | Use of Estimates The preparation of these financial statements in accordance with accounting principles generally accepted in the United States of America ( US GAAP ) requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. On an on-going basis, the Company evaluates all of these estimates and assumptions. The most important of these estimates and assumptions relate to revenue recognition, valuation allowance for deferred tax assets, estimates associated with accounting for asset acquisitions, and fair value measurements, including stock-based compensation. Although these and other estimates and assumptions are based on the best available information, actual results could be different from these estimates. |
Principles of Consolidation | Principles of Consolidation The Company consolidates the assets, liabilities, and operating results of its wholly-owned subsidiaries, majority-owned subsidiaries, and subsidiaries in which we hold a controlling financial interest as of the financial statement date. In most cases, a controlling financial interest reflects ownership of a majority of the voting interests. We consolidate a variable interest entity ( VIE ) when we possess both the power to direct the activities of the VIE that most significantly impact its economic performance and the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to the VIE. All intercompany accounts and transactions have been eliminated in consolidation. Non-controlling interests in the Company’s subsidiaries are reported as a component of equity, separate from the parent company’s equity or outside of permanent equity for non-controlling interests that are contingently redeemable. Results of operations attributable to the non-controlling interests are included in the Company’s consolidated statements of operations. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are comprised of cash and highly liquid investments with original maturities of 90 days or less at the date of purchase. Cash equivalents consist primarily of exchange-traded money market funds and U.S. treasury bills. The Company is exposed to credit risk in the event of default by the financial institutions or the issuers of these investments to the extent the amounts on deposit or invested are in excess of amounts that are insured. |
Investments in Marketable Securities | Investments in Marketable Securities Investments in marketable securities consist of U.S. treasury bills with original maturity exceeding 90 days. The Company classifies investments in debt securities as either trading, held-to-maturity, or available-for-sale. Securities are classified as trading if they are purchased and held principally for the purpose of selling in the near term and as held-to-maturity when the Company has both the positive intent and ability to hold the security to maturity. Investments in debt securities not classified as either trading or held-to-maturity are classified as available-for-sale securities. Trading securities are measured at fair value with unrealized gains and losses reported within net realized and unrealized gain (loss) on investments. Held-to-maturity securities are measured at amortized cost with realized gains and losses reported within net realized and unrealized gain (loss) on investments. Available-for-sale securities are measured at fair value with unrealized gains and losses reported in accumulated other comprehensive income (loss). As of September 30, 2023, all investments in marketable securities were classified as held-to-maturity and had original maturities (at the time of purchase) exceeding 90 days. As of September 30, 2023 , the amortized cost basis for these securities approximated their fair value. |
Investments, at Fair Value | Investments, at Fair Value Investments, at fair value, consist of equity and equity-related securities and debt securities classified as trading carried at fair value, as well as investments in private funds measured using the net asset value ( NAV ) as reported by each fund’s investment manager. The private funds calculate NAV in a manner consistent with the measurement principles of the Financial Accounting Standards Board ( FASB ) Accounting Standards Codification ( ASC ) Topic 946, Financial Services – Investment Companies , as of the valuation date. Changes in the fair value and NAV are recorded within net realized and unrealized gain (loss) on investments. Dividends received are recorded within dividends and interest income on the consolidated statements of operations. |
Real Estate under Development | Real Estate under Development Real estate under development is classified as follows: (i) real estate under development (current), which includes real estate projects that are in the process of being developed and expected to be completed and disposed of within one year of the balance sheet date; (ii) real estate under development (non-current), which includes real estate projects that are in the process of being developed and expected to be completed and disposed of more than one year from the balance sheet date; and (iii) real estate held for sale, which includes land and completed improvements thereon that meet all of the “held for sale” criteria. Real estate under development is carried at cost less impairment, if applicable. We capitalize costs that are directly identifiable with the specific real estate projects, including pre-acquisition and pre-construction costs, development and construction costs, taxes, and insurance. We do not capitalize any general and administrative or overhead costs, regardless of whether the costs are internal or paid to third parties. Capitalization begins when the activities related to development have begun and ceases when activities are substantially complete and the asset is available for occupancy. Real estate held for sale is recorded at the lower of cost or fair value less cost to sell. If an asset’s fair value less cost to sell, based on discounted future cash flows, management estimates or market comparisons, is less than its carrying amount, an allowance is recorded against the asset. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets include real estate under development, property and equipment, definite-lived intangible assets, and lease right-of-use assets. The Company evaluates the recoverability of long-lived assets whenever events or changes in circumstances indicate that their carrying value may not be recoverable based on undiscounted cash flows. Impairment losses are recorded when undiscounted cash flows estimated to be generated by an asset are less than the asset’s carrying amount. The amount of the impairment loss, if any, is calculated as the excess of the asset’s carrying value over its fair value, which is determined using a discounted cash flow analysis, management estimates or market comparisons. |
Earnings per Share | Earnings per Share The following table presents the calculation of basic and diluted net income (loss) per share: For the three months ended September 30, (in thousands except per share amounts) 2023 2022 Numerator: Net income (loss) from continuing operations $ 2,758 $ ( 9,503 ) Less: net loss attributable to non-controlling interest, continuing operations - ( 1,572 ) Numerator for basic EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc. $ 2,758 $ ( 7,931 ) Net income from discontinued operations 16 964 Less: net income attributable to non-controlling interest, discontinued operations - 1,324 Numerator for basic EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. $ 16 $ ( 360 ) Effect of dilutive securities: Interest expense associated with Convertible Notes, continuing operations $ 503 $ - Numerator for diluted EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc., after the effect of dilutive securities $ 3,261 $ ( 7,931 ) Numerator for diluted EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. $ 16 $ ( 360 ) Denominator: Denominator for basic EPS - Weighted average shares of common stock outstanding 29,579 28,543 Effect of dilutive securities: Restricted stock 1,363 - Convertible Notes 10,918 - Denominator for diluted EPS - Weighted average shares of common stock outstanding after the effect of dilutive securities 41,860 28,543 Basic net income (loss) per share from: Continuing operations $ 0.09 $ ( 0.28 ) Discontinued operations - ( 0.01 ) Basic net income (loss) per share $ 0.09 $ ( 0.29 ) Diluted net income (loss) per share from: Continuing operations $ 0.08 $ ( 0.28 ) Discontinued operations $ - ( 0.01 ) Diluted net income (loss) per share $ 0.08 $ ( 0.29 ) As of September 30, 2023, the Company had 3,264,424 potential shares of common stock issuable upon the exercise of stock options that are not included in the diluted net income (loss) per share calculation because to do so would be anti-dilutive for the three months ended September 30, 2023. As of September 30, 2022, the Company had 10,392,545 potential shares of common stock issuable upon the conversion of Convertible Notes (as defined below), 1,527,130 potential shares of common stock issuable upon the exercise of stock options, and 1,330,273 potential shares issuable upon vesting of restricted stock units and restricted stock awards that are not included in the diluted net income (loss) per share calculation for the three months ended September 30, 2022 because to do so would be anti-dilutive. As of September 30, 2023 and 2022 , the Company had an aggregate of 1,362,723 and 1,303,386 issued shares, respectively, that are not considered outstanding for accounting purposes since they are unvested and subject to forfeiture by the employees at a nominal price if service milestones are not met. |
Recently Adopted and Issued Accounting Standards | Recently Issued Accounting Standards Current Expected Credit Losses. In June 2016, the FASB issued Accounting Standards Update ( ASU ) 2016-13, Financial Instruments – Credit Losses (Topic 326) , which changes the impairment model for financial instruments, including trade receivables from an incurred loss method to a new forward looking approach, based on expected losses. The estimate of expected credit losses will require entities to incorporate considerations of historical experience, current information and reasonable and supportable forecasts. The amendments in this ASU are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted this ASU as of July 1, 2023 , which did not have a material impact on its consolidated financial statements. |
Revenue | The revenues from each major source are summarized in the following table: For the three months ended September 30, (in thousands) 2023 2022 Management fees $ 1,424 $ 1,302 Incentive fees 1,264 - Property management fees 282 274 Administration and service fees 340 284 Total revenues $ 3,310 $ 1,860 The Company recognizes investment management revenue at amounts that reflect the consideration to which it expects to be entitled in exchange for providing services to its customers. Investment management revenue primarily consists of fees based on a percentage of assets under management, fees based on the performance of managed assets, and administration and service fees. Fees are based on agreements with each investment product and may be terminated at any time by either party subject to the specific terms of each respective agreement. Management Fees The Company earns management fees based on the investment management agreements GECM has with Great Elm Capital Corp. ( GECC ), Monomoy Properties UpREIT, LLC, the operating partnership of Monomoy Properties REIT, LLC ( Monomoy UpREIT ) and other private funds managed by GECM (collectively, the Funds ). The performance obligation is satisfied and management fee revenue is recognized over time as the services are rendered, since the Funds simultaneously receive and consume the benefits provided as GECM performs services. Management fee rates range from 1.0 % to 1.5 % of the management fee assets specified within each agreement and are calculated and billed in arrears of the period, either monthly or quarterly. Property Management Fees Under the Monomoy UpREIT investment management agreement, GECM is also entitled to 4.0 % of rent collected. These fees are collected monthly in arrears. Property management fee revenue is recognized over time as the services are provided. Incentive Fees The Company earns incentive fees based on the investment management agreements GECM has with GECC and Monomoy Properties II, LLC ( MP II ), a feeder fund of Monomoy Properties REIT, LLC. Where an investment management agreement includes both management fees and incentive fees, the performance obligation is considered to be a single obligation for both fees. Incentive fees are variable consideration associated with the investment management agreements. Incentive fees are earned based on investment performance during the period, subject to the achievement of minimum return levels or high-water marks, in accordance with the terms of the respective investment management agreements. Incentive fees are typically 20 % of the performance-based metric specified within each agreement. Incentive fees are recognized when it is determined that they are no longer probable of significant reversal. During the three months ended September 30, 2023 , the Company recorded revenue in respect to the incentive fees due from GECC of $ 1.3 million. Administration and Service Fees The Company earns administration fees based on the administration agreement GECM has with GECC whereby the investment vehicles reimburse GECM for costs incurred in performing certain administrative functions. This revenue is recognized over time as the services are performed. Administration fees are billed quarterly in arrears, which is consistent with the timing of the delivery of services and reflect agreed upon rates for the services provided. The services are accounted for as a single performance obligation for each investment vehicle that is a series of distinct services with substantially the same pattern of transfer as the services are provided on a daily basis. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Earnings Per Share, Basic and Diluted | The following table presents the calculation of basic and diluted net income (loss) per share: For the three months ended September 30, (in thousands except per share amounts) 2023 2022 Numerator: Net income (loss) from continuing operations $ 2,758 $ ( 9,503 ) Less: net loss attributable to non-controlling interest, continuing operations - ( 1,572 ) Numerator for basic EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc. $ 2,758 $ ( 7,931 ) Net income from discontinued operations 16 964 Less: net income attributable to non-controlling interest, discontinued operations - 1,324 Numerator for basic EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. $ 16 $ ( 360 ) Effect of dilutive securities: Interest expense associated with Convertible Notes, continuing operations $ 503 $ - Numerator for diluted EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc., after the effect of dilutive securities $ 3,261 $ ( 7,931 ) Numerator for diluted EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. $ 16 $ ( 360 ) Denominator: Denominator for basic EPS - Weighted average shares of common stock outstanding 29,579 28,543 Effect of dilutive securities: Restricted stock 1,363 - Convertible Notes 10,918 - Denominator for diluted EPS - Weighted average shares of common stock outstanding after the effect of dilutive securities 41,860 28,543 Basic net income (loss) per share from: Continuing operations $ 0.09 $ ( 0.28 ) Discontinued operations - ( 0.01 ) Basic net income (loss) per share $ 0.09 $ ( 0.29 ) Diluted net income (loss) per share from: Continuing operations $ 0.08 $ ( 0.28 ) Discontinued operations $ - ( 0.01 ) Diluted net income (loss) per share $ 0.08 $ ( 0.29 ) |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Major Source of Revenue | The revenues from each major source are summarized in the following table: For the three months ended September 30, (in thousands) 2023 2022 Management fees $ 1,424 $ 1,302 Incentive fees 1,264 - Property management fees 282 274 Administration and service fees 340 284 Total revenues $ 3,310 $ 1,860 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Managed Investment Products | |
Schedule of Activity and Outstanding Balances Related Party and Company | The following tables summarize activity and outstanding balances between the managed investment products and the Company: For the three months ended September 30, (in thousands) 2023 2022 Net realized and unrealized gain (loss) on investments $ 3,362 $ ( 6,797 ) Net realized and unrealized loss on investments of Consolidated Fund - ( 16 ) Dividend income 836 1,380 (in thousands) September 30, 2023 June 30, 2023 Dividends receivable $ 300 $ 300 Investment management revenues receivable 2,779 2,167 Receivable for reimbursable expenses paid 994 841 Receivables from managed funds $ 4,073 $ 3,308 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Measured at Fair Value on Recurring and Non-recurring Basis | The assets and liabilities measured at fair value on a recurring and no n-recurring basis are summarized in the tables below: Fair Value as of September 30, 2023 (in thousands) Level 1 Level 2 Level 3 Total Assets: Equity investments $ 14,821 $ - $ - $ 14,821 Debt securities 4,522 - - 4,522 Total assets within the fair value hierarchy $ 19,343 $ - $ - $ 19,343 Investments valued at net asset value $ 18,522 Total assets $ 37,865 Liabilities: Contingent consideration liability $ - $ - $ 944 $ 944 Total liabilities $ - $ - $ 944 $ 944 Fair Value as of June 30, 2023 (in thousands) Level 1 Level 2 Level 3 Total Assets: Equity investments $ 14,296 $ - $ - $ 14,296 Total assets within the fair value hierarchy $ 14,296 $ - $ - $ 14,296 Investments valued at net asset value $ 18,315 Total assets $ 32,611 Liabilities: Contingent consideration liability $ - $ - $ 1,903 $ 1,903 Total liabilities $ - $ - $ 1,903 $ 1,903 |
Reconciliation of Changes in Contingent Consideration, Level 3 Liability | The following is a reconciliation of changes in contingent consideration, a Level 3 liability: For the three months ended September 30, (in thousands) 2023 2022 Beginning balance $ 1,903 $ 1,120 Payments ( 977 ) - Change in fair value 18 ( 70 ) Ending balance $ 944 $ 1,050 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Debt Instrument [Line Items] | |
Schedule of Long-Term Debt | (in thousands) Borrower September 30, 2023 June 30, 2023 GEGGL Notes GEG $ 26,945 $ 26,945 Total principal $ 26,945 $ 26,945 Unamortized debt discounts and issuance costs ( 1,067 ) ( 1,137 ) Long-term debt 25,878 25,808 |
Share-Based and Other Non-Cas_2
Share-Based and Other Non-Cash Compensation (Tables) | 3 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Activity of Restricted Stock Awards and Restricted Stock Units | The following table presents activity related to the Company’s restricted stock awards and restricted stock units for the three months ended September 30, 2023: Restricted Stock Awards and Restricted Stock Units Shares (in thousands) Weighted Average Grant Date Fair Value Outstanding at June 30, 2023 1,322 $ 1.93 Granted 532 2.07 Vested ( 322 ) 2.20 Forfeited - - Outstanding at September 30, 2023 1,532 $ 1.93 |
Summary of Option Activity | The following table presents activity related to the Company’s stock options for the three months ended September 30, 2023: Stock Options Shares (in thousands) Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at June 30, 2023 3,264 $ 2.70 7.45 $ - Options granted - - - - Forfeited, cancelled or expired - - - - Outstanding at September 30, 2023 3,264 $ 2.70 7.20 $ - Exercisable at September 30, 2023 1,260 $ 3.72 3.38 $ - |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) - shares | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Significant Accounting Policies [Line Items] | ||
Potentially dilutive shares excluded from diluted net income (loss) per share | 3,264,424 | |
Number of shares subject to forfeiture | 1,362,723 | 1,303,386 |
Change in accounting principle, accounting standards update, adopted [true false] | true | |
Change in accounting principle, accounting standards update, adoption date | Jul. 01, 2023 | |
Change in accounting principle, accounting standards update, immaterial effect [true false] | true | |
Common Stock Issuable upon Conversion of Convertible Notes | ||
Significant Accounting Policies [Line Items] | ||
Potentially dilutive shares excluded from diluted net income (loss) per share | 10,392,545 | |
Common Stock Issuable upon Exercise of Stock Options | ||
Significant Accounting Policies [Line Items] | ||
Potentially dilutive shares excluded from diluted net income (loss) per share | 1,527,130 | |
Common Stock Issuable upon Vesting of Restricted Stock Units and Restricted Stock Awards | ||
Significant Accounting Policies [Line Items] | ||
Potentially dilutive shares excluded from diluted net income (loss) per share | 1,330,273 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Accounting Policies [Abstract] | ||
Net (loss) income from continuing operations | $ 2,758 | $ (9,503) |
Less: net loss attributable to non-controlling interest, continuing operations | (1,572) | |
Numerator for basic EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc. | 2,758 | (7,931) |
Net income from discontinued operations | 16 | 964 |
Less: net income attributable to non-controlling interest, discontinued operations | 1,324 | |
Numerator for basic EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. | 16 | (360) |
Effect of dilutive securities: | ||
Interest expense associated with Convertible Notes, continuing operations | 503 | |
Numerator for diluted EPS - Net income (loss) from continuing operations attributable to Great Elm Group, Inc., after the effect of dilutive securities | 3,261 | (7,931) |
Numerator for diluted EPS - Net income (loss) from discontinued operations, attributable to Great Elm Group, Inc. | $ 16 | $ (360) |
Denominator: | ||
Denominator for basic EPS - Weighted average shares of common stock outstanding | 29,579 | 28,543 |
Effect of dilutive securities: | ||
Restricted stock | 1,363 | |
Convertible Notes | 10,918 | |
Denominator for diluted EPS - Weighted average shares of common stock outstanding after the effect of dilutive securities | 41,860 | 28,543 |
Basic net income (loss) per share from: | ||
Continuing operations | $ 0.09 | $ (0.28) |
Discontinued operations | (0.01) | |
Basic net income (loss) per share | 0.09 | (0.29) |
Diluted net income (loss) per share from: | ||
Continuing operations | 0.08 | (0.28) |
Discontinued operations | (0.01) | |
Diluted net income (loss) per share | $ 0.08 | $ (0.29) |
Revenue - Summary of Major Sour
Revenue - Summary of Major Source of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation Of Revenue [Line Items] | ||
Revenues | $ 3,310 | $ 1,860 |
Management Fees | ||
Disaggregation Of Revenue [Line Items] | ||
Revenues | 1,424 | 1,302 |
Incentive Fees | ||
Disaggregation Of Revenue [Line Items] | ||
Revenues | 1,264 | |
Property Management Fees | ||
Disaggregation Of Revenue [Line Items] | ||
Revenues | 282 | 274 |
Administration and Service Fees | ||
Disaggregation Of Revenue [Line Items] | ||
Revenues | $ 340 | $ 284 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) $ in Millions | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
Disaggregation Of Revenue [Line Items] | |
Incentive fee earned as percentage on investment performance | 20% |
Accrued incentive fees as per the terms of investment management agreements | $ 1.3 |
Minimum | |
Disaggregation Of Revenue [Line Items] | |
Percentage of management fee rates | 1% |
Maximum | |
Disaggregation Of Revenue [Line Items] | |
Percentage of management fee rates | 1.50% |
Funds | |
Disaggregation Of Revenue [Line Items] | |
Percentage entitled of rent collected | 4% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jan. 03, 2023 | Oct. 31, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | Jan. 01, 2023 | |
Related Party Transaction [Line Items] | ||||||
Consolidated funds | $ 0 | |||||
Receivables from Managed Funds | Shared Services Agreements | ||||||
Related Party Transaction [Line Items] | ||||||
Costs incurred under agreement | $ 400 | $ 100 | ||||
GECC | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of ownership interest (as a percent) | 19.60% | |||||
Number of sharers held in subsidiary | 1,493,560 | |||||
GEOF | ||||||
Related Party Transaction [Line Items] | ||||||
Contribution Amount | $ 3,000 | |||||
Percentage of ownership interest (as a percent) | 43% | |||||
Imperial Capital, LLC | ||||||
Related Party Transaction [Line Items] | ||||||
Retainer fee paid | $ 100 | |||||
Success fee paid | $ 700 | |||||
Shared Personnel and Reimbursement Agreement | Jason W. Reese | Investment Management Expenses | ||||||
Related Party Transaction [Line Items] | ||||||
Costs incurred under agreement | $ 200 | $ 400 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Activity and Outstanding Balances Between Managed Investment Products and Company (Details) - Managed Investment Products - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | |
Related Party Transaction [Line Items] | |||
Net realized and unrealized gain (loss) on investments | $ 3,362 | $ (6,797) | |
Net realized and unrealized loss on investments of Consolidated Fund | (16) | ||
Dividend income | 836 | $ 1,380 | |
Dividends receivable | 300 | $ 300 | |
Receivable for reimbursable expenses paid | 994 | 841 | |
Related Party | |||
Related Party Transaction [Line Items] | |||
Investment management revenues receivable | 2,779 | 2,167 | |
Receivables from managed funds | $ 4,073 | $ 3,308 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Assets and Liabilities Measured at Fair Value on Recurring and Non-recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Assets: | ||
Total assets | $ 37,865 | $ 32,611 |
Liabilities: | ||
Contingent consideration liability | 944 | 1,903 |
Total liabilities | 944 | 1,903 |
Fair Value, Inputs, Level 1 | ||
Assets: | ||
Equity investments | 14,821 | 14,296 |
Debt securities | 4,522 | |
Total assets | 19,343 | 14,296 |
Liabilities: | ||
Contingent consideration liability | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value, Inputs, Level 2 | ||
Assets: | ||
Equity investments | 0 | 0 |
Debt securities | 0 | |
Total assets | 0 | 0 |
Liabilities: | ||
Contingent consideration liability | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value, Inputs, Level 3 | ||
Assets: | ||
Equity investments | 0 | 0 |
Debt securities | 0 | |
Total assets | 0 | 0 |
Liabilities: | ||
Contingent consideration liability | 944 | 1,903 |
Total liabilities | 944 | 1,903 |
Fair Value, Inputs, Level 1, 2 and 3 | ||
Assets: | ||
Equity investments | 14,821 | 14,296 |
Debt securities | 4,522 | |
Total assets | 19,343 | 14,296 |
Fair Value Measured at Net Asset Value Per Share | ||
Assets: | ||
Investments valued at net asset value | $ 18,522 | $ 18,315 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Changes in Contingent Consideration, Level 3 Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | ||
Beginning balance | $ 1,903 | $ 1,120 |
Payments | (977) | |
Change in fair value | $ 18 | $ (70) |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Realized And Unrealized Gain Loss On Investments | Realized And Unrealized Gain Loss On Investments |
Ending balance | $ 944 | $ 1,050 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Jul. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | May 04, 2022 | |
Fair value assets level 1 to level 2 transfers | $ 0 | $ 0 | |||
Fair value assets level 2 to level 1 transfers | 0 | 0 | |||
Fair value asset transfers into level 3 | 0 | 0 | |||
Fair value asset transfers out of level 3 | 0 | 0 | |||
Fair value liabilities level 1 to level 2 transfers | 0 | 0 | |||
Fair value liabilities level 2 to level 1 transfers | 0 | 0 | |||
Fair value liability transfers into level 3 | 0 | 0 | |||
Fair value liability transfers out of level 3 | $ 0 | $ 0 | |||
Notice period for annually allowable redemptions | 90 days | ||||
Capped percentage of net asset value | 5% | ||||
Lockup period from date of investment | 1 year | ||||
Investment Management Agreement and Certain Other Assets for Monomoy Properties REIT L.L.C. | |||||
Asset acquisition, contingent consideration | $ 1,000,000 | $ 900,000 | |||
Investment Management Agreement and Certain Other Assets for Monomoy Properties REIT L.L.C. | Income Approach | Discount Rate | |||||
Measurement input | 0.08 | ||||
Monomoy Properties REIT, LLC | |||||
Maximum additional consideration payable | $ 2,000,000 | ||||
Unfunded binding commitment | $ 2,300,000 | ||||
Imperial Capital, LLC | |||||
Contingent consideration liability | $ 1,900,000 |
Real Estate Under Development -
Real Estate Under Development - Additional Information (Details) $ in Millions | 3 Months Ended |
Sep. 30, 2023 USD ($) Project | |
Real Estate [Line Items] | |
Capitalized cost within real estate under development current | $ | $ 1.4 |
Number of identifiable real estate projects | Project | 2 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Details) - Subsidiaries Other Outstanding Borrowings - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 |
Debt Instrument [Line Items] | ||
Total principal | $ 26,945 | $ 26,945 |
Unamortized debt discounts and issuance costs | (1,067) | (1,137) |
Long term debt | 25,878 | 25,808 |
GEGGL Notes | GEG | ||
Debt Instrument [Line Items] | ||
Total principal | $ 26,945 | $ 26,945 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) | 3 Months Ended | |||
Jun. 09, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | |
Debt Instrument [Line Items] | ||||
Interest expense other borrowings | $ 600,000 | $ 700,000 | ||
Aggregate principal amount | $ 37,912,000 | $ 37,912,000 | ||
GEGGL Notes | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 26,900,000 | |||
Interest rate | 7.25% | |||
Debt instrument maturity date | Jun. 30, 2027 | |||
Notes issued in minimum denominations | $ 25 | |||
Net consolidated debt to equity ratio | 2 | 0.35 | ||
GEGGL Notes | Underwriters' Over-allotment Option | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 1,900,000 | |||
GEGGL Notes | Minimum | ||||
Debt Instrument [Line Items] | ||||
Notes issued in integral multiples | $ 25 |
Convertible Notes - Additional
Convertible Notes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | |
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 37,912 | $ 37,912 | |
Interest expense | 1,062 | $ 1,974 | |
Convertible Notes | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 37,900 | $ 37,900 | |
Debt instrument maturity date | Feb. 26, 2030 | Feb. 26, 2030 | |
Issuance of notes to related parties. | $ 15,400 | ||
Accrued interest rate on notes payable | 5% | ||
Notes payable, interest rate description | The Convertible Notes accrue interest at 5.0% per annum, payable semiannually in arrears on June 30 and December 31, commencing June 30, 2020, in cash or in kind at the option of the Company. | ||
Number of common stock shares issuable upon conversion of each $1000 principal debt amount | 288.0018 | ||
Debt issuance costs | $ 1,200 | ||
Amortization period of convertible notes debt discount and debt issuance costs | 10 years | ||
Unamortized debt issuance costs | $ 800 | $ 800 | |
Interest expense | $ 500 | $ 500 |
Share-Based and Other Non-Cas_3
Share-Based and Other Non-Cash Compensation - Activity of Restricted Stock Award (Details) - Restricted Stock Awards and Restricted Stock Units shares in Thousands | 3 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Shares | |
Beginning Balance | shares | 1,322 |
Granted | shares | 532 |
Vested | shares | (322) |
Ending Balance | shares | 1,532 |
Weighted average grant date fair value | |
Beginning Balance | $ / shares | $ 1.93 |
Granted | $ / shares | 2.07 |
Vested | $ / shares | 2.20 |
Ending Balance | $ / shares | $ 1.93 |
Share-Based and Other Non-Cas_4
Share-Based and Other Non-Cash Compensation - Restricted Stock Awards and Restricted Stock Units - Additional Information (Details) | 3 Months Ended |
Sep. 30, 2023 shares | |
Restricted Stock Awards | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Granted, shares | 531,642 |
Restricted Stock Units | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Granted, shares | 0 |
Restricted Stock Awards and Restricted Stock Units | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Granted, shares | 532,000 |
Restricted Stock Awards and Restricted Stock Units | Maximum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Vesting period | 4 years |
Restricted Stock Awards and Restricted Stock Units | Minimum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Vesting period | 1 year |
Share-Based and Other Non-Cas_5
Share-Based and Other Non-Cash Compensation - Summary of Option Activity (Details) - $ / shares shares in Thousands | 3 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Jun. 30, 2023 | |
Shares | ||
Beginning Balance | 3,264 | |
Ending Balance | 3,264 | 3,264 |
Exercisable | 1,260 | |
Weighted average exercise price | ||
Beginning Balance | $ 2.7 | |
Ending Balance | 2.7 | $ 2.7 |
Exercisable | $ 3.72 | |
Weighted average remaining contractual term | ||
Outstanding | 7 years 2 months 12 days | 7 years 5 months 12 days |
Exercisable | 3 years 4 months 17 days |
Share-Based and Other Non-Cas_6
Share-Based and Other Non-Cash Compensation - Non-Employee Director Deferred Compensation Plan - Additional Information (Details) - Deferred Compensation Plan - shares | 1 Months Ended | |
Dec. 31, 2020 | Sep. 30, 2023 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Deferred compensation, service period | 3 years | |
Restricted stock units and restricted stock awards, deferred | 167,939 |
Share-Based and Other Non-Cas_7
Share-Based and Other Non-Cash Compensation - Stock-Based Compensation Expense - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Restricted Stock Awards and Restricted Stock Units and Stock Options | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 0.7 | $ 0.8 |
Restricted Stock Awards and Stock Options | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Total unrecognized compensation cost | $ 2.7 |
Share-Based and Other Non-Cas_8
Share-Based and Other Non-Cash Compensation - Stock-Based Compensation Expense - Other Non-Cash Compensation (Details) - GECC Common Shares $ in Millions | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Stock issued during period, value | $ 0.6 |
Stock issued during period value vested immediately | $ 0.1 |
Minimum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of years issued shares vest annually on pro-rata basis | 2 years |
Maximum | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of years issued shares vest annually on pro-rata basis | 3 years |
Employees | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Stock-based compensation expense | $ 0.1 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) $ in Millions | 12 Months Ended |
Jun. 30, 2023 USD ($) | |
Income Tax [Line Items] | |
Federal net operating loss carryforwards | $ 16.2 |
Massachusetts, Arizona and Nebraska | |
Income Tax [Line Items] | |
Operating loss carryforward for state income tax | 25.5 |
Federal | |
Income Tax [Line Items] | |
Net operating loss carryforwards, not subject to expiration | 8 |
Federal | Expire in Fiscal Years 2024 Through 2025 | |
Income Tax [Line Items] | |
Net operating loss carryforwards, subject to expiration | $ 8.2 |
Minimum | Massachusetts, Arizona and Nebraska | |
Income Tax [Line Items] | |
Operating loss carryforwards expiration period | 2031 |
Minimum | Federal | |
Income Tax [Line Items] | |
Operating loss carryforwards expiration period | 2024 |
Maximum | Massachusetts, Arizona and Nebraska | |
Income Tax [Line Items] | |
Operating loss carryforwards expiration period | 2043 |
Maximum | Federal | |
Income Tax [Line Items] | |
Operating loss carryforwards expiration period | 2025 |