YUNHONG GREEN CTI LTD.

Previous wording

At March 31, 2026, the company had $6.7 million outstanding on the revolving facility and $0.5 million on the term loan, with $0.3 million of remaining borrowing capacity.

Current wording

At June 30, 2026, the company had $4.6 million outstanding on the revolving facility and $0.45 million on the term loan, with $2.4 million of remaining borrowing capacity.

Previous wording

Foil Balloons. Revenues from the sale of foil balloons decreased during the three-month period ended March 31, 2026 to $3,487,000 compared to $4,234,000 during the same period of 2025. The decrease is related to the timing of orders and shipments. In the second half of 2025 one of our large mass retail customers made some adjustments to their replenishment system due to a surplus in their supply chain.

Current wording

Revenues from the sale of foil balloons decreased during the six-month period ended June 30, 2026 to $6,105,000 compared to $7,245,000 during the same period of 2025. The decrease is related to the timing of orders and shipments. In the second half of 2025 one of our large mass retail customers made some adjustments to their replenishment system due to a surplus in their supply chain.

Previous wording

Films. Revenues from the sale of commercial films decreased during the three-month period ended March 31, 2026 to $39,000 compared to $427,000 during the same period of 2025. Sales in this area have been inconsistent due to a small number of customers and a significant number of competitors.

Current wording

Films. Revenues from the sale of commercial films were $208,000 and $247,000 during the three and six month periods ended June 30, 2026, compared to $350,000 and $777,000 during the same periods of 2025. Sales in this area have been inconsistent due to a small number of customers and a significant number of competitors.

Previous wording

Other Revenues: Other revenues increased to $2,628,000 for the three-month period ended March 31, 2026, compared to $141,000 for the same period in 2025. The primary reason for the increase was the timing of spring product shipments, which occurred in first quarter of 2026 rather than the second quarter in 2025. Other revenues during these periods primarily consisted of: (i) sales of balloon-inspired gift products, including candy and small inflated balloons packaged in small containers; and (ii) sales of accessories and supply items related to balloon products. Sales to a limited number of customers continue to represent a large percentage of our net sales.

Current wording

Other Revenues: Revenues from the sale of other products were $1,074,000 and $3,702,000 during the three and six month periods ended June 30, 2026 compared to $2,095,000 and $2,237,000 during the same periods of 2025. Other revenues during these periods primarily consisted of: (i) sales of balloon-inspired gift products, including candy and small inflated balloons packaged in small containers; and (ii) sales of accessories and supply items related to balloon products. The main reason for the fluctuation of the sales is due to timing of Valentine’s Day related shipments, which occurred in December 2024 compared to Q1 2025 for the following year.

Previous wording

The table below illustrates the impact on sales of our top three and ten customers for the three-month periods ended March 31, 2026 and 2025.

Current wording

Sales to a limited number of customers continue to represent a large percentage of our net sales. The table below illustrates the impact on sales of our top three and ten customers for the three and six month periods ended June 30, 2026 and 2025.

Previous wording

During the three-month period ended March 31, 2026, there were two customers whose purchases represented more than 10% of the Company’s consolidated net sales. Sales to these customers for the three-month period ended March 31, 2026 were $2,378,000 and $2,969,000 or 39% and 48 %, respectively of consolidated net sales. Sales to these customers for the three months ended March 31, 2025 were $3,091,000 and $523,000, or 64% and 11%, respectively of consolidated net sales. As of March 31, 2026, the total amount owed to the Company by these customers was approximately $6,056,000, or 99% of the Company’s consolidated net accounts receivable.

Current wording

During the three and six months ended June 30, 2026 and 2025, there were two customers whose purchases represented more than 10% of the Company’s consolidated net sales. Sales to these customers for the three and six months ended June 30, 2026 and 2025 are as follows:

Previous wording

Selling, Advertising and Marketing. During the three-month period ended March 31, 2026, selling, advertising and marketing expenses were $190,000 as compared to $205,000 for the same period in 2025.

Current wording

Selling, Advertising and Marketing: During the three and six month periods ended June 30, 2026, selling, advertising and marketing expenses were $183,000 and $373,000 as compared to $205,000 and $410,000, respectively, for the same period in 2025. Selling, advertising and marketing costs have decreased by $22,000 and $37,000.

Previous wording

Other Income (Expense). During the three-month period ended March 31, 2026, the Company incurred interest expense of $242,000 as compared to interest expense of $237,000 during the same period of 2025.

Current wording

Other Income (Expense): During the three and six month periods ended June 30, 2026, the Company incurred interest expense of $225,000 and $467,000 as compared to interest expense of $227,000 and $465,000, respectively, during the same periods of 2025.

Previous wording

Operating Activities. During the three months ended March 31, 2026, net cash provided by operations was $236,000, compared to net cash provided in operations during the three months ended March 31, 2025 of $970,000.

Current wording

Operating Activities. During the six months ended June 30, 2026, net cash provided by operations was$2,535,000, compared to net cash provided by operations during the six months ended June 30, 2025 of $1,714,000.

Previous wording

Significant changes in working capital items during the three months ended March 31, 2026 included:

Current wording

Significant changes in working capital items during the six months ended June 30, 2026 included:

Previous wording

Investing Activity. During the three months ended March 31, 2026, cash used in investing activity was $27,000, compared to cash used in investing activity for the same period of 2025 in the amount of $20,000.

Current wording

Investing Activity. During the six months ended June 30, 2026, cash used in investing activity was $30,000, compared to cash used in investing activity for the same period of 2025 in the amount of $42,000.

Previous wording

Financing Activities. During the three months ended March 31, 2026, cash used in financing activities was $128,000 compared to cash used in financing activities for the same period of 2025 in the amount of $998,000. Financing activity during 2026 consisted principally of changes in the balances of revolving and long-term debt.

Current wording

Financing Activities. During the six months ended June 30, 2026, cash used in financing activities was $2,282,000 compared to cash used in financing activities for the same period of 2025 in the amount of $1,874,000. Financing activity during 2026 consisted principally of changes in the balances of revolving and principal repayments on term loan debt.

Previous wording

At March 31, 2026, the Company had cash balances of $178,000 compared to cash balances of $172,000 for the same period of 2025.

Current wording

At June 30, 2026, the Company had cash balances of $320,000 compared to cash balances of $18,000 for the same period of 2025.

Previous wording

The ability of the Company to continue as a going concern is dependent on the Company executing its business plan and, if unable to do so, in obtaining adequate capital on acceptable terms to fund any operating losses. Management’s plans to continue as a going concern include executing its business plan, continuing to focus on achieving profitable operations, and exploring alternative funding sources on an as needed basis. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The supply chain constraints, inflationary pressures and tariffs are expected to impact to some extent our operations and reduced access to capital. The ability of the Company to continue as a going concern is dependent upon its ability to successfully generate or otherwise secure other sources of financing and attain profitable operations. There is substantial doubt about the ability of the Company to continue as a going concern for one year from the issuance of the accompanying consolidated financial statements. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Current wording

The supply chain constraints, inflationary pressures and tariffs are expected to impact to some extent our operations and reduced access to capital. The ability of the Company to continue as a going concern is dependent upon its ability to successfully generate or otherwise secure other sources of financing and attain profitable operations. There is substantial doubt about the ability of the Company to continue as a going concern for one year from the issuance of the accompanying consolidated financial statements. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Although the Company remained in compliance with all financial covenants under the Credit Agreement as of June 30, 2026, management concluded that substantial doubt exists because anticipated operating cash flows and liquidity remain dependent upon obtaining additional financing or achieving sustained profitability.