Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “Viskase,” the “Company,” “we,” “us,” or “our” and similar terms mean Viskase Holdings, Inc. and its subsidiaries. The discussion below may contain forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in these forward-looking statements as a result of many factors, including but not limited to those under the heading “Forward-Looking Information and Factors that May Affect Future Results.”
You should read the following discussion and analysis of Viskase’s financial condition and results of operations together with Viskase’s audited financial statements for the year ended December 31, 2025, together with related notes thereto, included in Amendment No. 1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on May 1, 2026. The discussion and analysis should also be read together with (i) the section titled “Information about Viskase’s Business” in the prospectus/consent solicitation statement/offer to exchange filed by the Company with the SEC on January 30, 2026, (ii) our consolidated financial statements and notes to those statements included elsewhere in this Quarterly Report on Form 10-Q and (iii) our 2025 Annual Report on Form 10-K, as amended.
Overview
Viskase Holdings, Inc., previously known as Enzon Pharmaceuticals, Inc., is a Delaware corporation organized in 1970. Viskase, together with its subsidiaries, including Viskase Companies, operates in the casing product segment of the food industry. Viskase is a worldwide leader in the production and sale of cellulosic, fibrous and plastic casings for the processed meat and poultry industry. Viskase currently operates eight significant manufacturing facilities throughout North America, Europe, South America and Asia. Viskase provides value-added support services relating to these products for some of the world’s largest global consumer products companies. Viskase is one of the two largest worldwide producers of non-edible cellulosic casings for processed meats and one of the three largest manufacturers of non-edible fibrous casings.
Viskase’s net sales are driven by consumer demand for meat products and the level of demand for casings by processed meat manufacturers, as well as the average selling prices of Viskase’s casings. Specifically, demand for Viskase’s casings is dependent on population growth, overall consumption of processed meats and the types of meat products purchased by consumers. Average selling prices are dependent on overall supply and demand for casings and Viskase’s product mix.
Viskase’s cellulose, fibrous and plastic casing extrusion operations are capital-intensive and are characterized by high fixed costs. Viskase’s finishing operations are labor intensive. The industry’s operating results have historically been sensitive to the global balance of capacity and demand. The industry’s extrusion facilities produce casings under a timed chemical process and operate continuously.
Viskase’s gross profit varies with changes in selling price, input material costs, labor costs and manufacturing efficiencies. The total contribution margin increases as demand for Viskase’s casings increases. Viskase’s financial results benefit from increased volume because Viskase does not have to increase its fixed cost structure in proportion to increases in demand. For certain products, Viskase operates at near capacity in its existing facilities. Viskase regularly evaluates its capacity and projected market demand. Viskase believes the current and planned cellulosic production capacity in Viskase’s industry is in balance with global demand.
Viskase’s business strategy is to continue to improve operational efficiencies, product quality and throughput by upgrading existing production facilities and adding resources in high growth markets through new capital investments. Viskase has been successful in implementing production cost-savings initiatives and will continue to pursue similar opportunities that enhance its profitability and competitive positioning as a leader in the casing market. Viskase is focused on reducing extrusion, shirring and printing waste through equipment upgrades and an ongoing effort to redefine product mix. In addition, Viskase seeks entry into new value-added lines of business.
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Recent Developments
The Merger
On June 20, 2025, the Company entered into an Agreement and Plan of Merger (“Merger Agreement”) that was amended on October 23, 2025, by and between Enzon Pharmaceuticals, Inc. (which is now known as Viskase Holdings, Inc.), Viskase Companies, Inc. (which was converted into a limited liability company following the Merger and is now known as Viskase Companies, LLC (“Viskase Companies”), and EPSC Acquisition Corp. (“EPSC”). Pursuant to the terms of the Merger Agreement, EPSC was merged with and into Viskase Companies, with Viskase Companies surviving the merger as a wholly owned subsidiary of the Company (the “Merger”). Immediately following the Merger, Viskase Companies converted into a limited liability company under Delaware law, and the Company changed its name from “Enzon Pharmaceuticals, Inc.” to “Viskase Holdings, Inc.” References herein to the Company refer to Viskase Holdings, Inc., which operates it business through its subsidiaries, including Viskase Companies.
In connection the transactions contemplated by the Merger Agreement, prior to the completion of the Merger, Icahn Enterprises Holdings L.P. and certain of its affiliates (together, the “IEH Parties”) agreed to exchange the shares of the Company’s Series C Non-Convertible Redeemable Preferred Stock, par value $0.01 per share (the “Series C Preferred Stock”), held by them into shares of the Company’s common stock (the “IEH Exchange”), pursuant to the terms of a support agreement entered into between the Company, Viskase Companies, and the IEH Parties on June 20, 2025 and amended on October 23, 2025 (the “Support Agreement”). In addition, certain holders of the Series C Preferred Stock other than the IEH Parties exchanged their shares of Series C Preferred Stock for shares of the Company’s common stock pursuant to the terms of an exchange offer conducted by the Company (the “Series C Exchange Offer”).
On March 26, 2026 (the “Closing Date”), the Company consummated the Merger Agreement and, as a result, Viskase Companies became a wholly owned subsidiary of Viskase Holdings. Pursuant to the terms of the Merger Agreement, holders of Viskase Companies’ common stock were entitled to receive shares of the common stock of the Company as consideration for the Merger. Accordingly, all of the issued and outstanding shares of common stock of Viskase Companies were cancelled and exchanged for the right to receive the merger consideration, which consisted of shares of the Company’s common stock. As a result of the Merger, Viskase Companies became a wholly owned subsidiary of Viskase Holdings. However, for financial reporting purposes, Viskase Companies is deemed to be the accounting acquirer in the Merger.
The net assets of Viskase Holdings (formerly Enzon Pharmaceuticals, Inc.) as of the Closing Date are stated at historical cost, with no goodwill or other intangible assets recorded, and the operations following the completion of the Merger are those of Viskase Companies and its subsidiaries. Upon closing of the Merger, Viskase Holdings had approximately $40.8 million in cash. As a result of the completion of the Merger, the business and operations conducted by the Company are those that were conducted by Viskase Companies prior to the completion of the Merger.
The Restructuring Plan
2025 Restructuring Plan – Arkansas Plant Closure
On March 26, 2025, the Company announced that it would cease production at its Osceola, Arkansas facility effective as of May 31, 2025 (the “2025 Plant Closure Program”), which is part of the 2025 Restructuring Plan. In connection with the plant closure, 210 employees were separated under the Company’s separation plan resulting in severance of approximately $4,600 included in the restructuring and related costs for the year ended December 31, 2025. The plant closure resulted in an impairment of $9,600 related to the property, plant and equipment and $7,059 related to inventory which are recorded as an asset impairment charge in the condensed consolidated statement of operations for the year ended December 31, 2025.
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The following table summarizes the total charges related to the 2025 Restructuring Plan for the periods presented (in thousands):
Six Six
Months Ended Months Ended
June 30, June 30,
2026 2025
Cash restructuring charges:
Severance and other personnel costs $ — $ 5,597
Transfer and disposal costs and professional fees 566 —
Total cash charges 566 5,597
Non-cash charges:
Write-offs of inventory due to restructuring plan — 12,100
Total non-cash charges — 12,100
Total $ 566 $ 17,697
In connection with the 2025 Restructuring Plan, the Company does not expect that it will incur any significant additional cash charges during the remainder of 2026. The Company does not anticipate these cost-saving measures will impair its ability to conduct any of its key business functions. However, the Company may not be able to realize the cost savings and benefits initially anticipated as a result of the 2025 Restructuring Plan.
Impact of General Economic Risk Factors on our Business and Operations
Viskase is subject to continuing risks and uncertainties in connection with, and as a result of, the current geopolitical and economic uncertainty, including increases in inflation, risk of economic slowdown, fluctuating interest rates, new or increased tariffs and other barriers to trade, supply chain disruptions, changes to fiscal and monetary policy or government budget dynamics (particularly in the product segment of the food industry), volatility in financial markets, elevated energy and commodity prices, potential government shut downs, and war, military conflicts and/or hostilities, including the ongoing conflicts between Russia and Ukraine and regional hostilities in the Middle East and the responses thereto. While we are closely monitoring the impact of the current macroeconomic and geopolitical conditions on all aspects of our business, the ultimate extent of the impact on our business remains highly uncertain and will depend on future developments and factors that continue to evolve. Most of these developments and factors are outside of our control and could exist for an extended period of time, and could have material adverse effects on our business, results of operations, financial condition, and liquidity, including through increased input costs, disrupted supply chains, reduced consumer demand, tighter financial conditions, and impaired access to capital markets. We will continue to evaluate the nature and extent of the potential impacts to our business, results of operations, liquidity and capital resources. For additional information, see the section titled “Risk Factors — Risk Factors Relating to Viskase’s Business” in the prospectus/consent solicitation statement/offer to exchange filed by the Company with the SEC on January 30, 2026.
Components of Results of Operations
Net Sales
Viskase generates net sales from sales of its products, including cellulosic, fibrous and plastic casings for the processed meat and poultry industry. Viskase serves the majority of its natural channel customers through meat manufacturers, which purchase, store, sell and deliver Viskase’s products to consumers.
Viskase periodically offers promotional incentives to its customers, including customer rebates, temporary price reductions, off-invoice discounts, and other trade activities. At the end of each accounting period, Viskase recognizes a liability for an estimated promotional allowance reserve. Viskase periodically provides credits or discounts to its customers in the event that products do not conform to customer expectations upon delivery. Viskase treats these credits and discounts as a reduction of the sales price of the related transaction at the time of sale. Viskase anticipates that these promotional activities, credits and discounts could materially impact Viskase’s net revenue and that changes in such activities could impact period-over-period results.
Viskase’s casings are sold to customers at a premium price point, and when prices for competitor casings fall relative to the price of Viskase’s casings (including due to any price increases Viskase may implement), price-sensitive customers may choose to purchase casings offered by Viskase’s competitors instead of Viskase’s products. As a result, competitor pricing may adversely affect Viskase’s net revenue. Net revenue may also vary from period to period depending on the purchase orders Viskase receives, the volume and mix of Viskase’s products sold, and the channels through which Viskase’s products are sold.
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Cost of Sales
Cost of sales consists of the costs directly attributable to producing Viskase’s products, which include labor, raw material and packaging costs as well as overhead. The labor cost is comprised of wages and related costs for Viskase’s processing of crew members. The raw material is comprised of those items necessary to process Viskase’s finished casing products and the packaging costs are the cost of the packaging materials in which Viskase’s finished products are sold. Overhead costs in cost of goods sold include utilities, insurance, inbound freight, storage fees related to Viskase’s manufacturing facilities and depreciation and amortization expenses related to Viskase’s assets used in production.
Operating Expenses
Viskase’s operating expenses consist of selling, general and administrative expenses, amortization of intangibles, asset impairment expense, and restructuring and related expense, as further described below:
Selling, General and Administrative
Selling, general and administrative expenses consist primarily of personnel-related expenses, including recruiting costs, salaries, bonuses, benefits, and equity-based compensation, for individuals in Viskase’s executive, finance, operations, human resources, business development and other administrative functions. Other selling, general and administrative expenses include legal fees relating to corporate matters and patent-related activities, insurance costs, information technology, and professional and consulting fees associated with accounting, audit, tax and investor and public relations. Viskase expects selling, general and administrative expenses to increase in the future in connection with the expansion of the business and increased marketing costs.
Shipping and Distribution
Shipping and distribution expenses consist primarily of costs related to third-party freight for Viskase’s products. Viskase expects shipping and distribution expenses to increase in the medium-to-long term as Viskase continues to scale its business, and there is a risk that such expenses could continue to increase due to the dynamic and evolving global geopolitical and economic environment.
Amortization of Intangibles
Viskase has recognized definite lived intangible assets for customer relationships, technologies, patents, trademarks, and in-place leases. Amortization of these intangibles are recognized on a straight-line basis over the respective estimated useful lives on the intangible assets.
Asset Impairment Expense
In connection with its 2025 Restructuring Plan, Viskase took measures to close certain of its manufacturing facilities, resulting in asset impairment charges on its machinery in each respective location. These asset impairment charges are recorded as “asset impairment expense” within the consolidated statements of operations.
Restructuring and Related Expense
Any costs incurred related to the 2025 Restructuring Plan, including transfer and disposal costs, professional fees, severance and other personnel costs, and capital expenditures were recorded as “restructuring and related expense” within the consolidated statements of operations.
Non-Operating Expenses
Viskase’s non-operating expenses interest expense, net and other income (expense), net, as further described below:
Interest Expense, Net
Viskase records interest expense on its long-term debt based on the terms within its Credit Agreement, as further discussed and defined below with “Amended Senior Credit Facility.” This interest expense is partially offset by interest income earned on cash and cash equivalents.
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Other Income (Expense), Net
Other income (expense), net primarily relates to foreign currency gains and losses and the expense related to the reversal of a receivable for an uncertain tax with offset running through the “income tax provision” within the consolidated statement of operations.
Income Taxes
Viskase determines its effective tax rate by estimating its permanent differences resulting from differing treatment of items for financial and income tax purposes. Viskase is periodically audited by taxing authorities and considers any adjustments made as a result of the audits in computing its income tax expense. Any audit adjustments affecting permanent differences could have an impact on Viskase’s effective tax rate.
Deferred income taxes relate primarily to depreciation expense and share-based compensation programs accounted for differently for financial and income tax purposes. Changes in tax laws and rates could materially affect recorded deferred tax assets and liabilities in the future. Valuation allowances are recorded when it is more likely than not that a tax benefit will not be realized for a deferred tax asset. Changes in projected future earnings could affect Viskase’s recorded valuation allowances, if any, in the future.
Viskase records unrecognized tax benefit liabilities for known or anticipated tax issues for which the benefit is more likely than not based on its analysis of whether, and the extent to which, additional taxes will be due. However, due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the current estimate of the tax liabilities.To the extent Viskase prevails in matters for which unrecognized tax benefit liabilities have been established or are required to pay amounts in excess of its recorded liability, Viskase’s effective tax rate in a given financial statement period could be materially affected.
Results of Operations – Comparison of Three Months Ended June 30, 2026 and 2025
The following table summarizes Viskase’s annual condensed consolidated statement of operations for the periods presented (in thousands):
Three Months Three Months
Ended Ended
June June
30, 2026 30, 2025 Change
Net sales $ 90,131 $ 97,279 $ (7,148)
Cost of sales 79,033 85,645 (6,612)
Gross margin 11,098 11,634 (536)
Operating expenses
Selling, general and administrative 12,149 12,929 (780)
Amortization of intangibles 535 388 147
Asset impairment expense 226 — 226
Restructuring expense 203 947 (744)
Total operating expenses 13,113 14,264 (1,151)
Loss from operations (2,015) (2,630) 615
Other income (expense):
Interest expense, net 2,704 2,837 (133)
Other expense (income), net 109 438 (329)
Total other expense, net 2,813 3,275 (462)
Loss before income tax provision (4,828) (5,905) 1,077
Income tax provision (benefit) 305 14,353 1,077
Net loss $ (5,133) $ (20,258) $ 15,125
Net Sales
Net sales decreased by approximately $7.2 million, or (7.3)%, to $90.1 million for the three months ended June 30, 2026, compared to $97.3 million for the three months ended June 30, 2025. The decrease in net sales was primarily driven by volume-related decreases of approximately $10.9 million, partially offset by price and product mix-related increases of approximately $2.6 million and a favorable foreign currency impact of $1.1 million.
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The following table summarizes our segment revenues for the periods presented (in thousands):
Net Sales
Corporate and
North America South America EMEA Asia Other Consolidated
Three months Ended June 30, 2026 $ 41,375 $ 11,040 $ 50,038 $ 8,525 $ — $ 110,978
Three months Ended June 30, 2025 47,003 11,603 44,603 11,908 — 115,117
Change - $ (5,628) (563) 5,435 (3,383) — (4,139)
Change - % (13.6) % (5.1) % 10.9 % (39.7) % — (3.7) %
The decrease in North America nets sales of $5.6 million is mainly due to reduced sales volume resulting from a temporary production capacity issue related to the 2025 restructuring plan, offset by an increase in selling price. EMEA nets sales has increased $5.4 million due to $5.3 million of intercompany sales volume. Asia net sales decreased $3.4 million due to sales volume.
Cost of Sales
Cost of sales decreased by approximately $6.6 million or (7.7)% to $79.0 million for the three months ended June 30, 2026, compared to $85.6 million for the three months ended June 30, 2025. The decrease in cost of sales was primarily driven by lower volumes of product sold due to temporary capacity constraints.
Gross Margin
Gross margin decreased by approximately $0.5 million, or (4.6)%, to $11.1 million for the three months ended June 30, 2026, compared to $11.6 million for the three months ended June 30, 2025. The decrease in gross margin was primarily driven by lower volumes of product sold due to temporary capacity constraints.
Operating Expenses
Selling, General and Administrative
Selling, general and administrative expenses decreased by approximately $0.8 million, or 6.0%, to $12.1 million for the three months ended June 30, 2026, compared to $12.9 million for the three months ended June 30, 2025. The decrease was primarily driven by lower year over year professional fees and payroll expenses.
Amortization of Intangibles
Amortization of intangible assets totaled approximately $0.5 million for the three months ended June 30, 2026 compared to $0.4 million for the three months ended June 30, 2025 on the amortization of intangible assets recognized with acquisitions.
Restructuring and Related Expenses
Restructuring and related expense totaled approximately $0.2 million for the three months ended June 30, 2026, compared to an expense of $0.9 million for the three months ended June 30, 2025. See the discussion in the Restructuring Plan section above for additional details.
Income from Operations
Loss from operations totaled approximately $2.0 million for the three months ended June 30, 2026, compared to $2.6 million for the three months ended June 30, 2025. The decrease in operating loss of $0.6 million or (23.4)% was primarily driven by the decrease in selling, general and administrative expenses.
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The following table summarizes our segment operating income for the periods presented (in thousands):
Operating (Loss) Income
Corporate
and
North America South America EMEA Asia Other Consolidated
Three months Ended June 30, 2026 $ (3,932) $ (293) $ 2,100 $ 106 $ 4 $ (2,015)
Three months Ended June 30, 2025 (2,709) 208 (1,012) 872 11 (2,630)
Change -$ (1,223) (501) 3,112 (766) — 615
Change - % 31.1 % 171.0 % 148.2 % (722.6) % — (30.5) %
North America operating income has improved $0.6 million due to selling, general and administrative.
Other Income (Expense):
Interest Expense, Net
Interest expense, net of interest income totaled approximately $2.7 million for the three months ended June 30, 2026 compared to $2.8 million for the three months ended June 30, 2025.
Other Expense, Net
Other expense, net totaled approximately $0.1 million for the three months ended June 30, 2026, compared to approximately $0.4 million for the three months ended June 30, 2025. The decrease was primarily driven by foreign currency gains or losses recognized during the period.
Income Taxes:
Income Tax Provision
During the three months ended June 30, 2026, an income tax provision of approximately $0.3 million was recognized on the loss before income taxes of $4.8 million compared to an income tax expense of approximately $14.4 million for the three months ended June 30, 2025 on loss before income taxes of $5.9 million. Our effective income tax rate was (6)% and (243.6)% for the three months ended June 30, 2026 and 2025, respectively.
For the three months ended June 30, 2026 the effective tax rate was lower than the statutory federal rate of 21%, for corporations, primarily due to a valuation allowance against US deferred tax assets and the jurisdictional mix of earnings and operating losses expected for the year.
For the three months ended June 30, 2025 the effective tax rate was higher than the statutory federal rate of 21%, for corporations, primarily due to the recognition of a valuation allowance against the deferred tax assets in the U.S. and the jurisdictional mix of earnings and operating losses expected for the year.
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Results of Operations – Comparison of Six Months Ended June 30, 2026 and 2025
The following table summarizes Viskase’s annual condensed consolidated statement of operations for the periods presented (in thousands):
Six Months Six Months
Ended Ended
June 30, 2026 June 30, 2025 Change
Net sales $ 176,668 $ 191,467 $ (14,799)
Cost of sales 156,570 165,427 (8,857)
Gross margin 20,098 26,040 (5,942)
Operating expenses
Selling, general and administrative 24,583 24,624 (41)
Amortization of intangibles 1,071 750 321
Asset impairment expense 226 12,100 (11,874)
Restructuring expense 566 5,597 (5,031)
Total operating expenses 26,446 43,071 (16,625)
Loss from operations (6,348) (17,031) 10,683
Other income (expense):
Interest expense, net 5,528 5,597 (69)
Other expense (income), net (1,074) (1,717) 643
Total other expense, net 4,454 3,880 574
Loss before income tax provision (10,802) (20,911) 10,109
Income tax provision 1,053 12,941 (11,888)
Net loss $ (11,855) $ (33,852) $ 21,997
Net Sales
Net sales decreased by approximately $14.8 million, or (7.7)%, to $176.7 million for the six months ended June 30, 2026, compared to $191.5 million for the six months ended June 30, 2025. The decrease in net sales was primarily driven by volume-related decreases of approximately $23.7 million, partially offset by price and product mix-related increases of approximately $3.9 million and a favorable foreign currency impact of $5.0 million.
The following table summarizes our segment revenues for the periods presented (in thousands):
Net Sales
Corporate
North America South America EMEA Asia and Other Consolidated
Six months Ended June 30, 2026 $ 77,866 $ 22,427 $ 101,662 $ 16,405 $ — $ 218,360
Six months Ended June 30, 2025 100,314 22,998 85,663 21,273 — 230,248
Change - $ (22,448) (571) 15,999 (4,868) — (11,888)
Change - % (28.8) % (2.5) % 15.7 % (29.7) % — (5.4) %
The decrease in North America nets sales of $22.4 million is mainly due to reduced sales volume resulting from a temporary production capacity issue related to the 2025 restructuring plan, offset by an increase in selling price. EMEA nets sales has increased $16.0 million due to $12 million of intercompany sales volume and $4 million of increased customer sales mainly driven by foreign currency translation. Asia net sales decreased $4.9 million due to sales volume.
Cost of Sales
Cost of sales decreased by approximately $8.9 million or (5.4)% to $156.6 million for the six months ended June 30, 2026, compared to $165.4 million for the six months ended June 30, 2025. The decrease in cost of sales was primarily driven by lower volumes of product sold due to temporary capacity constraints.
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Gross Margin
Gross margin decreased by approximately $5.9 million, or (22.8)%, to $20.1 million for the six months ended June 30, 2026, compared to $26.0 million for the six months ended June 30, 2025. The decrease in gross margin was primarily driven by lower volumes of product sold due to temporary capacity constraints.
Operating Expenses
Selling, General and Administrative
Selling, general and administrative expenses remained the same at $24.6 million for the six months ended June 30, 2026 and 2025.
Amortization of Intangibles
Amortization of intangible assets totaled approximately $1.1 million for the six months ended June 30, 2026 and $0.8 million for the six months ended June 30, 2025 on the amortization of intangible assets recognized with acquisitions.
Restructuring and Related Expenses
Restructuring and related expense totaled approximately $0.6 million for the six months ended June 30, 2026, compared to an expense of $5.6 million for the six months ended June 30, 2025. See the discussion in the Restructuring Plan section above for additional details.
Income from Operations
Loss from operations totaled approximately $6.3 million for the six months ended June 30, 2026, compared to $17.0 million for the six months ended June 30, 2025. The decrease in operating loss of $10.7 million or (62.7)% was primarily driven by asset impairment expense of $12.1 million recorded in during the same period in prior year, partially offset by lower year over year gross margin during the six months ended June 30, 2026.
The following table summarizes our segment operating income for the periods presented (in thousands):
Operating (Loss) Income
Corporate
North America South America EMEA Asia and Other Consolidated
Six months Ended June 30, 2026 $ (9,736) $ (206) $ 2,845 $ 749 $ — $ (6,348)
Six months Ended June 30, 2025 (20,379) 480 1,319 1,466 83 (17,031)
Change - $ 10,643 (686) 1,526 (717) — 10,683
Change - % (109.3) % 333.0 % 53.6 % (95.7) % — (168.3) %
North America operating income has improved $10.6 million due to lower asset impairment and restructuring expense of $4.8 million offset by a decrease in gross profit due to lower sales volume. EMEA operating income is higher by $1.5 million compared to June 30, 2025 due to higher gross profit on sales mix and inflation on costs.
Other Income (Expense):
Interest Expense, Net
Interest expense, net of interest income totaled approximately $5.5 million for the six months ended June 30, 2026 and $5.6 million for the six months ended June 30, 2025.
Other (Expense) Income, Net
Other income, net totaled approximately $1.1 million for the six months ended June 30, 2026, compared to approximately $1.7 million for the six months ended June 30, 2025. The decrease was primarily driven by foreign currency gains or losses recognized during the period.
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Income Taxes:
Income Tax Provision
During the six months ended June 30, 2026, an income tax provision of approximately $1.1 million was recognized on the loss before income taxes of $10.8 million compared to an income tax expense of approximately $12.9 million for the six months ended June 30, 2025 on loss before income taxes of $20.9 million. Our effective income tax rate was (9.7)% and (61.9)% for the six months ended June 30, 2026 and 2025, respectively.
For the six months ended June 30, 2026 the effective tax rate was lower than the statutory federal rate of 21%, for corporations, primarily due to the jurisdictional mix of earnings and operating losses expected for the year.
For the six months ended June 30, 2025 the effective tax rate was higher than the statutory federal rate of 21%, for corporations, primarily due to a valuation allowance against US deferred tax assets and the jurisdictional mix of earnings and operating losses expected for the year.
Liquidity and Capital Resources
Sources and Uses of Cash
Viskase’s primary sources of liquidity are net cash provided by operating activities and available borrowing capacity under its Amended Senior Credit Facility and Foreign Lines of Credit (as further discussed and defined below). As of June 30, 2026, Viskase had approximately $7.9 million of cash and cash equivalents and approximately $5.8 million of unused borrowing capacity under the Amended Senior Credit Facility, net of letters of credit.
On April 16, 2026, we finalized the Seventh Amendment to our Credit Agreement, which extended the Maturity Date from August 13, 2026 until August 13, 2027, amended the definition of Applicable Rate to increase the interest rate, amended the definition of Consolidated EBITDA to address the treatment of certain restructuring and transaction related costs and expenses, amended the definition of Permitted Transfers to allow the disposition of the equipment, real property and improvements of the Osceola Facility and the real property and improvements of the Chicago Property, and amended certain thresholds for obligations under the Existing Credit Agreement.
Currently, primary uses of cash are for our operations, capital expenditures, and debt service. We believe that net cash generated from operating activities, cash on hand, and available borrowings under its Amended Senior Credit Facility will be adequate to meet Viskase’s liquidity and capital requirements for the foreseeable future. As our debt or credit facilities become due, we will need to repay, extend or replace such facilities. Our ability to do so will be subject to future economic conditions and financial, business, and other factors, many of which are beyond our control.
Going Concern
The assessment of liquidity and going concern requires us to make judgments about its ability to meet its obligations as they fall due for at least one year after the date that its condensed consolidated financial statements for the six months ended June 30, 2026 are issued.
The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate refinancing of its Senior Credit Facility before its maturity in August 2027.
We fully expect the refinancing will be completed before the maturity of Senior Credit Facility. However, there is no assurance that the Company will be able to obtain sufficient additional funds to refinance these maturities or that such funds, if available, will be obtainable on terms satisfactory to the Company, and therefore substantial doubt exists about the Company’s ability to continue as a going concern.
The condensed consolidated financial statements do not include any adjustments that might result from the Company being unable to continue as a going concern.
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Cash Flows – Comparison of Six Months Ended June 30, 2026 and 2025
The following table summarizes Viskase’s cash flows for the periods presented (in thousands):
Six Months Six Months
Ended Ended
June June
30, 2026 30, 2025
Net cash (used in) provided by operating activities (27,520) 2,373
Net cash used in investing activities (16,682) (16,342)
Net cash provided by financing activities 42,997 16,833
Foreign currency translation (101) 344
Net (decrease) increase in cash and cash equivalents $ (1,306) $ 3,208
Net Cash Provided by Operating Activities
Viskase’s operating cash flow is primarily driven by Viskase’s earnings and changes in operating assets and liabilities, such as accounts receivable, inventories, accounts payable and other accrued liabilities, as well as other factors described below. Cash requirements for operating activities are subject to Viskase’s operating needs and the timing of collection of receivables and payments of payables and expenses.
For the six months ended June 30, 2026, net cash used in operating activities was approximately $(27.5) million, compared to net cash provided by operating activities of approximately $2.4 million for the six months ended June 30, 2025. The decrease was primarily attributable to increases in receivables, inventories, and other current assets, as well as a decrease in accounts payable during the six months ended June 30, 2026.
Net Cash Used in Investing Activities
For the six months ended June 30, 2026, net cash used in investing activities was approximately $16.7 million, compared to $(16.3) million for the six months ended June 30, 2025. The increase was primarily attributable to capital expenditures related to manufacturing facilities and production equipment.
Net Cash Provided by Financing Activities
Net cash provided by financing activities was approximately $43.0 million for the six months ended June 30, 2026, compared to $16.8 million for the six months ended June 30, 2025, representing an increase of $26.2 million. The increase was primarily attributable to $40.9 million of cash acquired in connection with the Enzon reverse recapitalization transaction and $15.0 million of proceeds from a private placement of common stock, partially offset by $10.9 million of repayments of short-term debt.
Recent Accounting Pronouncements
See Note 1 - “Summary of Significant Accounting Policies”- to our interim unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for a description of recent accounting pronouncements, if any, including the expected dates of adoption and the anticipated impact on our unaudited condensed consolidated and audited consolidated financial statements.
Off-Balance Sheet Arrangements
As of June 30, 2026, Viskase did not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material effect on its current and future financial condition, results of operations, liquidity, capital expenditures or capital resources.
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Forward-Looking Information and Factors That May Affect Future Results
Certain statements contained in this discussion may be considered forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend,” and other similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements, including, without limitation, those that are set forth in the section titled “Risk Factors” in the prospectus/consent solicitation statement/offer to exchange filed by the Company with the SEC on January 30, 2026. These risks and uncertainties should be considered carefully and readers are cautioned not to place undue reliance on such forward-looking statements. As such, Viskase cannot assure you that the future results covered by the forward-looking statements will be achieved. Forward-looking statements may relate to, among other things:
oour ability to meet liquidity requirements and to fund necessary capital expenditures;
othe strength of demand for our products, prices for our products and changes in overall demand;
oassessment of market and industry conditions and changes in the relative market shares of industry participants;
oconsumption patterns and consumer preferences;
othe effects of competition and competitor responses to our products and services;
oour ability to realize operating improvements and anticipated cost savings;
opending or future legal proceedings and regulatory matters;
ogeneral economic conditions and their effect on our business, including the impact of geopolitical issues or conflicts;
ochanges in the cost or availability of raw materials and changes in energy prices or other costs, including any impact associated with quotas, duties, tariffs, taxes or other similar restrictions upon the import or export of materials or the geopolitical conditions;
opricing pressures for our products;
othe cost of and compliance with environmental laws and other governmental regulations;
oour results of operations for future periods;
oour anticipated capital expenditures;
oour ability to pay, and our intentions with respect to the payment of, dividends on shares of our capital stock;
oour ability to protect our intellectual property;
oeconomic and industry conditions affecting our customers and suppliers, including the impact of inflation;
oour ability to identify, complete and integrate acquisitions, including the business combination between Enzon and Viskase Companies, pursuant to which Viskase Companies became a wholly owned subsidiary of Enzon (now known as Viskase Holdings, Inc);
oour strategy for the future, including opportunities that may be presented to and/or pursued by us; and
othe Company may not be able to utilize its net operating losses and tax credit carryforwards.
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These forward-looking statements are not guarantees of future performance. Forward-looking statements are based on management’s expectations that involve risks and uncertainties.