ACQUISITIONS AND DIVESTITURES

6 Months Ended

Jun. 30, 2025

Acquisitions And Divestitures

ACQUISITIONS AND DIVESTITURES

4. ACQUISITIONS AND DIVESTITURES

Discontinued Operations

On November 22, 2024, Eightco Holdings Inc. (the “Company”) entered into an Asset Purchase Agreement (the “APA”) to sell substantially all of the assets of its wholly owned subsidiary, Ferguson Containers, Inc., to a New Jersey limited liability company controlled by certain management employees of the Corrugated Packaging Business (the “Buyers”). This sale was completed on April 7, 2025 with an effective date of April 1, 2025. The following summarizes the transaction:

	April 1,
	2025
Consideration:
Cash		557,835
Seller note		2,500,000
Total consideration	$	3,057,835
Assets Disposed:
Cash and cash equivalents	$	125,431
Accounts receivable, net		771,162
Inventories		179,923
Prepaid expenses and other current assets		144,668
Property and equipment, net		641,271
Total assets	$	1,862,455
Less: assumed liabilities by the Buyers		(36,394	)
Net assets disposed of in divestiture	$	1,826,061
Gain on divestiture	$	1,231,774

As a result of the sale, the Company has classified the historical operations of Ferguson Containers as discontinued operations in the consolidated financial statements for all periods presented. Assets and liabilities associated with Ferguson Containers have been classified as “held for sale” as of December 31, 2024.

The following summarizes the components of the assets and liabilities from discontinued operations as of June 30, 2025 and December 31, 2024:

	June 30,		December 31,
	2025		2024
ASSETS
Current assets:
Cash and cash equivalents	$	-	$	168,323
Accounts receivable, net		-		788,317
Inventories		-		101,577
Prepaid expenses and other current assets		-		105,249
Property and equipment, net		-		634,773
Total assets	$	-	$	1,798,239
LIABILITIES
Current liabilities:
Accounts payable	$	-	$	2,980
Accrued expenses and other current liabilities		-		31,775
Income tax payable		-		72,976
Deferred tax liabilities		-		-
Total liabilities	$	-	$	107,731

EIGHTCO HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

4. ACQUISITIONS AND DIVESTITURES (continued)

The following summarizes the components of net income from discontinued operations for the three and six months ended June 30, 2025 and 2024:

	Three Months Ended June 30,
	2025		2024
Revenues		-		1,733,420
Cost of revenues		-		1,279,392
Gross profit:		-		454,028
Operating expenses:
Selling, general and administrative		-		339,273
Restructuring and severance		-		-
Operating income		-		114,755
Other (expense) income:
Interest (expense)		-		-
Other income		-		566
Total other income, net		-		566
Income before income taxes		-		115,321
Income tax benefit		-		-
Net income from discontinued operations	$	-	$	115,321

	Six Months Ended June 30,
	2025		2024
Revenues		1,773,929		3,394,543
Cost of revenues		1,276,685		2,443,763
Gross profit:		497,244		950,780
Operating expenses:
Selling, general and administrative		393,013		673,289
Restructuring and severance		-		-
Operating income		104,231		277,491
Other (expense) income:
Interest (expense)		-		-
Other income		1,322		4,658
Total other income, net		1,322		4,658
Income before income taxes		105,553		282,149
Income tax benefit		-		-
Net income from discontinued operations	$	105,553	$	282,149

The following summarizes the components of cash flows from discontinued operations for the six months ended June 30, 2025 and 2024:

	For the Six Months Ended June 30, 2025			For the Six Months Ended June 30, 2024
Cash flows from operating activities:
Net income	$	105,553		$	282,149
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		37,992			87,487
Changes in assets and liabilities:
Accounts receivable		17,155			(93,353	)
Inventories		(78,346	)		(36,559	)
Prepaid expenses and other current assets		(39,419	)		27,686
Accounts payable		(2,812	)		(942	)
Accrued expenses and other current liabilities		(6,777	)		1,727
Income tax payable		(61,748	)		-
Net cash provided by (used in) operating activities		(28,402	)		268,195
Cash flows from investing activities:
Repayments (proceeds) from/to Eightco Holdings, Inc.		30,000			(1,344,500	)
Purchases of property and equipment		(44,490	)		(4,847	)
Working capital cash transferred to Buyer		(125,431	)		-
Net cash used in investing activities		(139,921	)		(1,349,346	)
Net decrease in cash and cash equivalents		(168,323	)		(1,081,151	)
Cash and cash equivalents, beginning of the period		168,323			1,358,806
Cash and cash equivalents, end of the period	$	-		$	277,655

As a result of this classification, prior period amounts have been reclassified to conform to the current period presentation.

EIGHTCO HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)