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Equity Method Investments (Tables)

3 Months Ended

Mar. 31, 2025

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Joint Venture Revenues and Net Income (Loss)

The table below details the Company’s joint venture revenues, earnings, assets, and liabilities for the three months ended and as of March 31, 2025 (in thousands):


	DHC8 LLC		KNFH II LLC			DLZ Solutions LLC		HGC Funding I LLC and Origination I LLC		HGC MPG Funding LLC		Total
Revenue	$	55	$	—		$	130	$	1,202	$	1,392	$	2,779
Gross profit		55		(53	)		130		1,202		1,392		2,726
Operating income (loss)		41		(108	)		19		1,203		1,392		2,547
Net income (loss)		41		(108	)		19		1,203		1,392		2,547
Assets		928		7,568			7,901		23,247		31,381		71,025
Liabilities		624		2,267			8		22		—		2,920

The table below details the Company’s joint venture revenues, earnings, assets, and liabilities for the three months ended and as of March 31, 2024 (in thousands):


	DHC8 LLC		KNFH II LLC			HGC Funding I LLC and Origination I LLC		HGC MPG Funding LLC		Total
Revenues	$	321	$	—		$	1,140	$	1,241	$	2,702
Gross profit		321		—			1,140		1,241		2,702
Operating income (loss)		268		(44	)		1,134		1,241		2,599
Net income (loss)		268		(44	)		1,134		1,241		2,599
Assets		4,700		8,306			27,174		36,413		76,593
Liabilities		1,080		4,000			1,244		—		6,324

Lessor Arrangements

In December 2023, the Company, with certain partners making up the KNFH II LLC joint venture, entered into a purchase and sale agreement for a pharmaceutical plant in Fenton, Missouri, including land, a building, and all machinery and equipment held within, with a purchase price of $8.0 million.

In April 2024, KNFH II LLC entered into a purchase and sale agreement for the machinery and equipment within the pharmaceutical plant with a purchase price of $5.0 million. Additionally, KNFH II LLC entered into a lease agreement for the lease of the real estate assets; the building and land. This lease agreement includes a purchase option with a purchase price of $8.0 million that is expected to be exercised by the lessee. The lessor arrangement is classified as a sales-type lease, and, therefore, the present value of future lease payments, including the purchase option, has been recognized as revenue and a lease receivable as of the effective date. As of March 31, 2025, the Company recognized approximately $1.2 million in earnings from equity method investments, related to the Company’s share of net income attributable to KNFH II LLC.

On January 29, 2025, DLZ, a joint venture in which the Company holds a 20% share, entered into a purchase agreement for a pharmaceutical plant in Huntsville, Alabama, including land and a building, with a purchase price of approximately $7.8 million. Simultaneously, DLZ entered into a lease agreement with the Seller, for the lease of the real estate assets, the building and land. This lease agreement includes a purchase option exercisable prior to the end of the first 18-month lease term with a purchase price of approximately $9.7 million. Concurrently, the Company sold a one-third economic interest in cash flows related to the DLZ investment, which is reflected as a secured borrowing on its balance sheet within other non-current liabilities. As of March 31, 2025, the Company has not recorded any earnings related to the investment.

Additionally, on January 29, 2025, the Company purchased a 20% participating interest in a financial asset for approximately $1.6 million. The participants’ investment was used to purchase machinery and equipment at the same pharmaceutical plant in Huntsville, Alabama for approximately $7.8 million. The participants entered into a lease agreement to lease the purchased machinery and equipment back to the seller with an 18-month lease term which includes purchase option exercisable prior to the end of the term with a purchase price of approximately $9.5 million. As of March 31, 2025, the Company reflects its participating interest of $1.6 million on its balance sheet within other long-term assets. Concurrently, the Company sold a one-third economic interest in cash flows related to its participating interest, which is reflected as a secured borrowing on its balance sheet within other non-current liabilities. As of March 31, 2025, the Company has not recorded any profit or loss related to its participating interest.