What is the outlook for the adjusted net loss of $1 million—are there one‑off items that will be excluded in future periods?
Short answer:
The $1 million adjusted net loss reported for Q2 2025 is being “artificially” reduced by several non‑recurring items – a $7 million sale‑lease‑back gain, about $4 million of foreign‑exchange gains and, to a lesser extent, restructuring charges. Those items are unlikely to recur in the same magnitude (or at all) in subsequent quarters, so the adjusted loss figure will probably be higher (i.e., a larger loss) when those one‑offs are excluded going forward.
Why the Q2 2025 adjusted loss looks small
| Component | Effect on the quarter’s results | Recurring? |
|---|---|---|
| Sale‑lease‑back gain | +$7 million (gain) | Typically a one‑time transaction; not expected each quarter. |
| Foreign‑exchange gains | +$4 million (gain) | Currency swings can be volatile, but the $4 million gain cited is described as a specific, material upside that is unlikely to repeat at the same level. |
| Restructuring costs | – (part of the offset) | Restructuring is usually a discrete expense tied to a specific re‑organization effort; once the program is executed, the charge tapers off. |
| Underlying operating performance | Revenue $200 M, net income $8 M (≈$0.61 EPS) | This reflects the “core” business and will be the baseline for future periods. |
When you strip out the $7 M and $4 M gains (and the one‑off restructuring drag), the underlying result is a loss of roughly $1 million for the quarter (≈ $0.10 per diluted share). That loss is essentially the “true” operating result without the boost of non‑recurring items.
Outlook for future adjusted net loss (or profit)
No repeat of the $7 M sale‑lease‑back gain – Sale‑lease‑back transactions are strategic, capital‑structure moves that companies seldom execute quarterly. Unless Forum announces another similar asset‑sale deal, that boost will not appear again.
Foreign‑exchange gains are volatile, not dependable – The $4 M upside came from favorable currency movements in the reporting period. While future FX exposure will continue, there is no guarantee of a comparable gain; in fact, adverse movements could turn the effect into a loss.
Restructuring costs are largely completed – The press release mentions “restructuring costs” as part of the offset. Such costs are normally incurred during the implementation of a cost‑reduction or re‑organization plan and then taper off. Expect those expenses to be minimal in the next quarters.
Management’s tone is upbeat – Neal Lux, President & CEO, said the team “delivered strong results” and the company raised its full‑year 2025 cash‑flow guidance. Raising cash‑flow guidance typically reflects confidence that operating cash generation will improve or stay robust, which would support a healthier earnings profile (i.e., a smaller loss or a move to profit) once the one‑offs are stripped out.
Core profitability appears solid – Even before the non‑recurring items, the company posted GAAP net income of $8 M on $200 M of revenue (≈ 4 % margin). If the underlying operating margin holds, the “adjusted” loss figure would likely be much smaller than the headline GAAP loss once the $11 M of gains are excluded in the future.
What to expect in the next reporting periods
- Adjusted loss will likely increase (i.e., become a larger loss) relative to the Q2 “$1 M” figure, because the $11 M of one‑off gains will not recur.
- If underlying operating performance stays at or improves upon the 4 % margin reported, the adjusted loss could be modest—potentially a breakeven or small profit once the company continues to trim expenses and benefits from the raised cash‑flow guidance.
- Analysts will watch for any new non‑recurring items (e.g., asset sales, large FX hedging outcomes, or further restructuring) that could again distort the adjusted loss figure. In their absence, the adjusted net loss will reflect the true operating result.
Bottom line
- The $1 million adjusted net loss is already “cleaned up” by $11 million of one‑off gains (sale‑lease‑back and FX) and some restructuring costs.
- Those one‑off items are not expected to repeat at the same scale, so future quarters’ adjusted results will exclude them, meaning the adjusted loss number will likely be higher (i.e., a larger loss) unless the core business improves enough to offset their removal.
- The company’s raised cash‑flow guidance and the CEO’s positive commentary suggest management expects the underlying business to sustain or improve profitability, which would mitigate the impact of removing those one‑off items.
In short, the adjusted net loss of $1 million should be viewed as a baseline operating loss; future periods will likely show a larger adjusted loss if the non‑recurring gains disappear, but the overall outlook appears positive based on the guidance lift and the solid underlying earnings performance.