UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

⌧ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended ~~December~~March 31, ~~2024~~2025


◻	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period from ___________to _________

Commission File Number 1-15589

(Exact name of registrant as specified in its charter)


Delaware		47-0702918
(State or other jurisdiction		(I.R.S. Employer
of incorporation or organization)		Identification No.)

7405 Irvington Road, Omaha NE		68122
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code: (402) 331-3727

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 Par Value	DIT	NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files) Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ◻	Accelerated filer ◻	Non-accelerated filer ⌧

Smaller reporting company ⌧	Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ◻ No ⌧

The Registrant had 645,462 shares of its $.01 par value common stock outstanding as of ~~January~~April 17, 2025.

Table of Contents

Form 10-Q

~~1st~~2nd Quarter

INDEX

~~December~~March 31, ~~2024~~2025 PAGE PART I — FINANCIAL INFORMATION Item 1. Financial Statements: Condensed consolidated balance sheets at ~~December~~March 31, ~~2024~~2025 (unaudited) and September 30, 2024 3 Condensed consolidated unaudited statements of operations for the three and six months ended ~~December~~March 31, ~~2024~~2025 and ~~2023~~2024 4 Condensed consolidated unaudited statements of shareholders’ equity for the three and six months ended ~~December~~March 31, ~~2024~~2025 and ~~2023~~2024 5 Condensed consolidated unaudited statements of cash flows for the ~~three~~six months ended ~~December~~March 31, ~~2024~~2025 and ~~2023~~2024 6 Notes to condensed consolidated unaudited financial statements 7 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 1516 Item 3. Quantitative and Qualitative Disclosures About Market Risk 2224 Item 4. Controls and Procedures 2225 PART II — OTHER INFORMATION Item 1. Legal Proceedings 2426 Item 1A. Risk Factors 2426 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 2426 Item 3. Defaults Upon Senior Securities 2426 Item 4. Mine Safety Disclosures 2426 Item 5. Other Information 2426 Item 6. Exhibits 2527

Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Balance Sheets

~~December~~March 31, ~~2024~~2025 and September 30, 2024


	~~December~~March		September
	~~2024~~2025		2024
	(Unaudited)
ASSETS
Current assets:
Cash	$	~~535~~685,~~862~~854	$	672,788
Accounts receivable, less allowance for credit losses of $2.4 million at December 2024 and $2.3 million at September 2024		70,590,733		70,653,907
Accounts receivable, less allowance for credit losses of $2.2 million at March 2025 and $2.3 million at September 2024		65,081,021		70,653,907
Inventories, net		~~174~~160,~~523~~544,~~527~~902		144,254,843
Income taxes receivable		~~396~~338,~~222~~291		718,645
Prepaid expenses and other current assets		1213,~~096~~011,~~904~~905		12,765,088
Total current assets		~~258~~239,~~143~~661,~~248~~973		229,065,271

Property and equipment, net		~~106~~110,~~745~~596,~~867~~212		106,049,061
Operating lease right-of-use assets, net		2628,~~246~~485,~~028~~790		25,514,731
Goodwill		5,778,325		5,778,325
Other intangible assets, net		4,~~612~~478,~~808~~383		4,747,234
Other assets		3,~~142~~003,~~994~~354		2,952,688
Total assets	$	~~404~~392,~~669~~004,~~270~~037	$	374,107,310

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	4757,~~342~~221,~~697~~231	$	54,498,225
Accrued expenses		14,~~947~~807,~~716~~437		15,802,727
Accrued wages, salaries and bonuses		34,~~256~~821,~~748~~368		8,989,355
Current operating lease liabilities		7,~~337~~679,~~464~~960		7,036,751
Current maturities of long-term debt		5,~~248~~314,~~488~~657		5,202,443
Current mandatorily redeemable non-controlling interest		1,~~757~~812,~~237~~558		1,703,604
Total current liabilities		7991,~~890~~657,~~350~~211		93,233,105

Credit facilities		~~165~~142,~~900~~291,~~612~~571		121,272,004
Deferred income tax liability, net		43,~~443~~802,~~893~~644		4,374,316
Long-term operating lease liabilities		1921,~~203~~060,~~592~~350		18,770,001
Long-term debt, less current maturities		1513,~~176~~823,~~659~~014		16,562,908
Mandatorily redeemable non-controlling interest, less current portion		6,~~649~~866,~~075~~610		6,507,896
Other long-term liabilities		~~985~~1,~~936~~151,765		1,657,295

Shareholders’ equity:
Preferred stock, $.01 par value, 1,000,000 shares authorized		—		—
Common stock, $.01 par value, 3,000,000 shares authorized, 645,462 shares outstanding at December 2024 and 630,362 shares outstanding at September 2024		9,799		9,648
Common stock, $.01 par value, 3,000,000 shares authorized, 645,462 shares outstanding at March 2025 and 630,362 shares outstanding at September 2024		9,799		9,648
Additional paid-in capital		35,~~077~~715,~~446~~308		34,439,735
Retained earnings		~~108~~106,~~604~~897,~~071~~928		108,552,565
Treasury stock at cost		(31,272,163)		(31,272,163)
Total shareholders’ equity		~~112~~111,~~419~~350,~~153~~872		111,729,785
Total liabilities and shareholders’ equity	$	~~404~~392,~~669~~004,~~270~~037	$	374,107,310

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

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AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Operations

for the three and six months ended ~~December~~March 31, ~~2024~~2025 and ~~2023~~2024


	For the three months ended ~~December~~March				For the six months ended March
	~~2024~~2025		~~2023~~2024		2025		2024
Sales (including excise taxes of $143.4 million and $138.1 million, respectively)	$	711,273,256	$	644,959,073
Sales (including excise taxes of $126.1 and $127.4 million, and $269.5 and $265.5 million, respectively)	$	619,503,087	$	601,877,306	$	1,330,776,344	$	1,246,836,380
Cost of sales		~~664~~576,~~379~~475,~~704~~202		~~601~~559,~~658~~566,~~151~~439		1,240,854,907		1,161,224,591
Gross profit		4643,~~893~~027,~~552~~885		4342,~~300~~310,~~922~~867		89,921,437		85,611,789
Selling, general and administrative expenses		40,~~587~~107,~~630~~953		3736,~~258,~~677,814		80,695,584		73,936,491
Depreciation and amortization		2,~~635~~458,~~601~~027		2,~~219~~289,~~168~~390		5,093,628		4,508,558
		4342,~~223~~565,~~231~~980		3938,~~477~~967,~~845~~204		85,789,212		78,445,049
Operating income		3461,~~670,321~~905		3,~~823~~343,~~077~~663		4,132,225		7,166,740

Other expense (income):
Interest expense		2,~~846~~266,~~621~~407		2,~~311~~247,~~513~~737		5,113,028		4,559,250
Change in fair value of mandatorily redeemable non-controlling interest		~~194~~272,~~812~~856		~~199~~134,~~744~~389		467,668		334,133
Other (income), net		(~~111~~56,~~531~~398)		(~~563~~191,~~141~~006)		(167,930)		(754,147)
		2,~~929~~482,~~902~~865		12,~~948~~191,~~116~~120		5,412,766		4,139,236
Income from operations before income taxes		740,419		1,874,961
Income (loss) from operations before income taxes		(2,020,960)		1,152,543		(1,280,541)		3,027,504
Income tax expense		392,000		804,000
Income tax expense (benefit)		(431,000)		613,000		(39,000)		1,417,000
Net income available to common shareholders	$	348,419	$	1,070,961
Net income (loss) available to common shareholders	$	(1,589,960)	$	539,543	$	(1,241,541)	$	1,610,504

Basic earnings per share available to common shareholders	$	0.57	$	1.80
Basic earnings (loss) per share available to common shareholders	$	(2.58)	$	0.90	$	(2.02)	$	2.69
Diluted earnings per share available to common shareholders	$	0.57	$	1.78
Diluted earnings (loss) per share available to common shareholders	$	(2.58)	$	0.89	$	(2.02)	$	2.66

Basic weighted average shares outstanding		~~611~~615,~~322~~261		~~595~~600,~~623~~161		613,270		597,879
Diluted weighted average shares outstanding		~~613~~615,~~573~~261		~~603~~608,~~300~~029		613,270		605,917

Dividends paid per common share	$	0.1846	$	0.1846	$	0.64	$	0.64

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

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AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Shareholders’ Equity

for the three and six months ended ~~December~~March 31, ~~2024~~2025 and ~~2023~~2024


							Additional
	Common Stock			Treasury Stock			Paid-in		Retained
	Shares	Amount		Shares	Amount		Capital		Earnings		Total
THREE MONTHS ENDED DECEMBER 2023
THREE MONTHS ENDED MARCH 2024
Balance, October 1, 2023	943,272	$	9,431	(334,583)	$	(31,272,163)	$	30,585,388	$	104,846,438	$	104,169,094
Balance, January 1, 2024	964,945	$	9,648	(334,583)	$	(31,272,163)	$	32,521,091	$	105,627,432	$	106,886,008
Dividends on common stock, $0.46 per share	—		—	—		—		—		(289,967)		(289,967)
Dividends on common stock, $0.18 per share	—		—	—		—		—		(113,465)		(113,465)
Compensation expense and issuance of stock in connection with equity-based awards	21,673		217	—		—		1,935,703		—		1,935,920
Compensation expense related to equity-based awards	—		—	—		—		639,548		—		639,548
Net income available to common shareholders	—		—	—		—		—		1539,~~070,961~~543		1539,~~070,961~~543
Balance, December 31, 2023	964,945	$	9,648	(334,583)	$	(31,272,163)	$	32,521,091	$	105,627,432	$	106,886,008
Balance, March 31, 2024	964,945	$	9,648	(334,583)	$	(31,272,163)	$	33,160,639	$	106,053,510	$	107,951,634

THREE MONTHS ENDED DECEMBER 2024
THREE MONTHS ENDED MARCH 2025
Balance, October 1, 2024	964,945	$	9,648	(334,583)	$	(31,272,163)	$	34,439,735	$	108,552,565	$	111,729,785
Balance, January 1, 2025	980,045	$	9,799	(334,583)	$	(31,272,163)	$	35,077,446	$	108,604,071	$	112,419,153
Dividends on common stock, $0.46 per share	—		—	—		—		—		(296,913)		(296,913)
Dividends on common stock, $0.18 per share	—		—	—		—		—		(116,183)		(116,183)
Compensation expense and issuance of stock in connection with equity-based awards	15,100		151	—		—		637,711		—		637,862
Compensation expense related to equity-based awards	—		—	—		—		637,862		—		637,862
Net income available to common shareholders	—		—	—		—		—		348,419		348,419
Net loss available to common shareholders	—		—	—		—		—		(1,589,960)		(1,589,960)
Balance, December 31, 2024	980,045	$	9,799	(334,583)	$	(31,272,163)	$	35,077,446	$	108,604,071	$	112,419,153
Balance, March 31, 2025	980,045	$	9,799	(334,583)	$	(31,272,163)	$	35,715,308	$	106,897,928	$	111,350,872


							Additional
	Common Stock			Treasury Stock			Paid-in		Retained
	Shares	Amount		Shares	Amount		Capital		Earnings		Total
SIX MONTHS ENDED MARCH 2024
Balance, October 1, 2023	943,272	$	9,431	(334,583)	$	(31,272,163)	$	30,585,388	$	104,846,438	$	104,169,094
Dividends on common stock, $0.64 per share	—		—	—		—		—		(403,432)		(403,432)
Compensation expense and issuance of stock in connection with equity-based awards	21,673		217	—		—		2,575,251		—		2,575,468
Net income available to common shareholders	—		—	—		—		—		1,610,504		1,610,504
Balance, March 31, 2024	964,945	$	9,648	(334,583)	$	(31,272,163)	$	33,160,639	$	106,053,510	$	107,951,634

SIX MONTHS ENDED MARCH 2025
Balance, October 1, 2024	964,945	$	9,648	(334,583)	$	(31,272,163)	$	34,439,735	$	108,552,565	$	111,729,785
Dividends on common stock, $0.64 per share	—		—	—		—		—		(413,096)		(413,096)
Compensation expense and issuance of stock in connection with equity-based awards	15,100		151	—		—		1,275,573		—		1,275,724
Net loss available to common shareholders	—		—	—		—		—		(1,241,541)		(1,241,541)
Balance, March 31, 2025	980,045	$	9,799	(334,583)	$	(31,272,163)	$	35,715,308	$	106,897,928	$	111,350,872

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

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AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Cash Flows

for the ~~three~~six months ended ~~December~~March 31, ~~2024~~2025 and ~~2023~~2024


	~~December~~March		~~December~~March
	~~2024~~2025		~~2023~~2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income available to common shareholders	$	348,419	$	1,070,961
Net income (loss) available to common shareholders	$	(1,241,541)	$	1,610,504
Adjustments to reconcile net income available to common shareholders to net cash flows from (used in) operating activities:
Adjustments to reconcile net income (loss) available to common shareholders to net cash flows from (used in) operating activities:
Depreciation		24,~~501~~824,~~175~~777		24,~~084~~239,~~743~~707
Amortization		~~134~~268,~~426~~851		~~134~~268,~~425~~851
(Gain) loss on sales of property and equipment		(~~840~~44,229)		(53105,~~287~~505)
Equity-based compensation		~~637~~1,~~862~~275,724		~~571~~1,~~137~~210,685
Deferred income taxes		69(571,~~577~~672)		~~467~~153,~~203~~444
Provision for credit losses		~~112~~(164,~~746~~616)		(91133,~~969~~707)
Inventory allowance		2432,~~405~~688		3022,~~988~~413
Change in fair value of contingent consideration		(1,453,452)		—
Change in fair value of mandatorily redeemable non-controlling interest		~~194~~467,~~812~~668		~~199~~334,~~744~~133
Changes in assets and liabilities:
Changes in assets and liabilities, net of effects of business combinations:
Accounts receivable		~~(49~~5,~~572)~~749,877		24,~~147~~130,~~484~~987
Inventories		(3013,~~293~~324,~~089~~448)		~~384~~37,~~466~~236,124
Prepaid and other current assets		~~668~~(245,~~184~~028)		(~~362~~1,~~792~~680,438)
Other assets		(~~190~~50,~~306~~666)		~~(22~~104,~~366)~~191
Accounts payable		(62,~~911~~898,~~400)~~936		19,~~627~~475,~~403~~057
Accrued expenses and accrued wages, salaries and bonuses		(64,~~055~~490,~~070~~508)		(34,~~649~~402,~~088~~600)
Other long-term liabilities		71237,~~823~~652		~~120~~283,~~275~~553
Income taxes payable and receivable		~~322~~380,~~423~~354		~~336~~1,~~797~~009,754
Net cash flows from (used in) operating activities		(395,~~867~~449,~~877~~633)		453,~~996~~757,~~124~~153

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(36,~~453~~451,~~711~~773)		(311,~~947~~084,~~143~~390)
Proceeds from sales of property and equipment		1267,~~442~~208		~~124~~234,~~803~~278
Net cash flows from (used in) investing activities		(3,441,269)		(3,822,340)
Acquisition of Arrowrock Supply (See Note 2)		(6,131,527)		—
Net cash flows from (used in) investing activities		(12,516,092)		(10,850,112)

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit facilities		~~713~~1,~~853~~262,~~301~~647,310		~~603~~1,~~650~~128,~~771~~853,805
Repayments under revolving credit facilities		(~~669~~1,~~224~~241,~~693~~627,743)		(~~604~~1,~~014~~170,~~807~~097,086)
Principal payments on long-term debt		(12,~~340~~627,~~204~~680)		(~~490~~1,~~518~~099,738)
Dividends on common stock		(~~116~~413,~~184~~096)		(~~113~~403,~~466~~432)
Net cash flows from (used in) financing activities		4317,~~172~~978,~~220~~791		(~~968~~42,~~020~~746,451)
Net change in cash		~~(136~~13,~~926)~~066		~~205~~160,~~764~~590
Cash, beginning of period		672,788		790,931
Cash, end of period	$	~~535~~685,~~862~~854	$	~~996~~951,~~695~~521

Supplemental disclosure of cash flow information:
Cash paid during the period for interest, net of amounts capitalized	$	25,~~815~~215,~~683~~092	$	24,~~235~~568,~~562~~790
Cash paid during the period for income taxes, net of refunds		151,318		194,902

Supplemental disclosure of non-cash information:
Equipment acquisitions classified in accounts payable	$	~~772~~841,~~820~~018	$	~~347~~167,~~891~~913
Dividends declared, not paid		180,729		176,501
Purchase of property financed with promissory note		—		8,000,000
Issuance of common stock in connection with the vesting ofequity-based awards		—		1,296,372

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

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AMCON Distributing Company and Subsidiaries

Notes to Condensed Consolidated Unaudited Financial Statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION

AMCON Distributing Company and Subsidiaries (“AMCON” or the “Company”) serves customers in 34 states through two business segments:

●

Our wholesale distribution segment (the “Wholesale Segment”), which includes our Team Sledd, LLC (“Team Sledd”) and Henry’s Foods, Inc. (“Henry’s”) subsidiaries, distributes consumer products and provides a full range of programs and services to our customers that are focused on helping them manage their business and increase their profitability. We serve customers primarily in the Central, Rocky Mountain, Great Lakes, Mid-South and Mid-Atlantic regions of the United States.

●

Our retail health food segment (the “Retail Segment”) operates 15 health food retail stores located throughout the Midwest and Florida.

WHOLESALE SEGMENT

Our Wholesale Segment is one of the largest wholesale distributors in the United States, serving approximately 7,900 retail outlets including convenience stores, grocery stores, liquor stores, drug stores, and tobacco shops. We currently distribute over 20,000 different consumer products, including cigarettes and tobacco products, candy and other confectionery products, beverages, groceries, paper products, health and beauty care products, frozen and refrigerated products and institutional foodservice products. We have licenses, and operate, in 34 states, and are the third (3rd) largest convenience store distributor by geographic territory served.

Our Wholesale Segment offers retailers the ability to take advantage of manufacturer- and Company-sponsored sales and marketing programs, merchandising and product category management services, and the use of information systems and data services that are focused on minimizing retailers’ investment in inventory, while seeking to maximize their sales and profits. In addition, our wholesale distribution capabilities provide valuable services to both manufacturers of consumer products and convenience retailers. Manufacturers benefit from our broad retail coverage, inventory management, efficiency in processing small orders, and frequency of deliveries. Convenience retailers benefit from our distribution capabilities by gaining access to a broad product line, inventory optimization and merchandising expertise, information systems, and accessing trade credit.

Our Wholesale Segment operates 14 distribution centers located in Colorado, Idaho, Illinois, Indiana, Minnesota, Missouri, Nebraska, North Dakota, South Dakota, Tennessee and West Virginia. These distribution centers, combined with cross-dock facilities, include approximately 1.7 million square feet of permanent floor space. Our principal suppliers include Altria, RJ Reynolds, ITG Brands, Hershey, Kellanova, Kraft Heinz, and Mars Wrigley. We also market private label lines of water, candy products, batteries, and other products. We do not maintain any long-term purchase contracts with our suppliers.

RETAIL SEGMENT

Market banners. We operate within the natural products retail industry, which is a subset of the United States grocery industry. This industry includes conventional, natural, gourmet and specialty food markets, mass and discount retailers, warehouse clubs, health food stores, dietary supplement retailers, drug stores, farmers markets, mail order and online retailers, and multi-level marketers. These stores carry over 32,000 different nationally and regionally branded and private label products including high-quality natural, organic, and specialty foods consisting of produce, baked goods, frozen foods, nutritional supplements, personal care items, and general merchandise.

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FINANCIAL STATEMENTS

The Company’s fiscal year ends on September 30th. The results for the interim period included with this Quarterly Report may not be indicative of the results which could be expected for the entire fiscal year. All significant intercompany transactions and balances have been eliminated in consolidation. Certain information and footnote disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles (“GAAP”) have been condensed or omitted. In the opinion of management, the accompanying condensed consolidated unaudited financial statements (“financial statements”) contain all adjustments necessary to fairly present the financial information included herein. The Company believes that although the disclosures contained herein are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the Company’s annual audited consolidated financial statements for the fiscal year ended September 30, 2024, as filed with the Securities and Exchange Commission on Form 10-K. For purposes of this report, unless the context indicates otherwise, all references to “we”, “us”, “our”, the “Company”, and “AMCON” shall mean AMCON Distributing Company and its consolidated subsidiaries. Additionally, the three-month fiscal periods ended ~~December~~March 31, ~~2024~~2025 and ~~December~~March 31, ~~2023~~2024 have been referred to throughout this Quarterly Report as Q1Q2 2025 and Q1Q2 2024, respectively. The fiscal balance sheet dates as of ~~December~~March 31, ~~2024~~2025 and September 30, 2024 have been referred to as ~~December~~March ~~2024~~2025 and September 2024, respectively.

ACCOUNTING PRONOUNCEMENTS

Recent Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, “Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures”, which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU also expands disclosure requirements to enable users of financial statements to better understand the entity’s measurement and assessment of segment performance and resource allocation. This guidance is effective for fiscal years beginning after December 15, 2023 (fiscal 2025 for the Company), and interim periods within fiscal years beginning after December 15, 2024 (fiscal 2026 for the Company), with early adoption permitted. The Company is currently reviewing this ASU and its potential impact on our consolidated financial statements.

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740) – Improvements to Income Tax Disclosures”, which enhances the transparency, effectiveness and comparability of income tax disclosures by requiring consistent categories and greater disaggregation of information related to income tax rate reconciliations and the jurisdictions in which income taxes are paid. This ~~guidance~~ASU is effective for annual periods beginning after December 15, 2024 (fiscal 2026 for the Company), with early adoption permitted. The Company is currently reviewing this ASU and its potential impact on our consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures”, which improves disclosure requirements and provides more detailed information about an entity’s expenses, specifically amounts related to purchases of inventory, employee compensation, depreciation, intangible asset amortization, and selling expenses, along with qualitative descriptions of certain other types of expenses. This guidance is effective for fiscal years beginning after December 15, 2026 (fiscal 2028 for the Company), and interim periods within fiscal years beginning after December 15, 2027 (fiscal 2029 for the Company), with early adoption permitted. The Company is currently reviewing this ASU and its potential impact on our consolidated financial statements.

2. ~~INVENTORIES~~ACQUISITION

~~Inventories~~On inJanuary ~~our~~17, ~~Wholesale~~2025, ~~Segment~~the ~~consisted~~Company ofacquired ~~finished~~substantially ~~goods~~all ~~and~~of ~~are stated at~~ the ~~lower~~operating assets of ~~cost~~Davis-Jones, orInc. ~~net~~d/b/a ~~realizable~~Arrowrock ~~value~~Supply (“Arrowrock”), ~~utilizing~~for ~~FIFO~~approximately ~~and average cost methods~~$6.1 ~~Inventories~~million in ~~our~~cash. ~~Retail~~Costs ~~Segment~~to ~~consisted~~effectuate ~~of finished goods and are stated at~~ the ~~lower~~acquisition ofwere ~~cost~~not orsignificant ~~market~~and ~~using~~were ~~the~~expensed ~~retail~~as ~~method~~incurred. The ~~wholesale~~transaction ~~distribution~~was ~~and~~funded ~~retail~~with ~~health~~borrowings ~~food~~from ~~segment inventories consist of finished products purchased in bulk quantities to be redistributed to~~ the Company’s ~~customers~~existing orbank ~~sold at retail~~group. ~~Finished~~The ~~goods~~acquisition ~~included total reserves~~ of ~~approximately~~Arrowrock ~~$1.2~~provides ~~million~~access atto ~~both~~new ~~December~~markets ~~2024~~ and ~~September~~improved ~~2024.~~service ~~These~~capability ~~reserves~~for ~~include~~accounts ~~the~~in ~~Company’s~~our ~~obsolescence~~existing ~~allowance,~~service ~~which reflects estimated unsalable or non-refundable inventory based upon an evaluation of slow-moving and discontinued products~~area.

The Company paid cash consideration for the acquired assets and their related values as of the acquisition date, measured in accordance with FASB Accounting Standards Codification 805 – Business Combinations (“ASC 805”). No value was

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3assigned to any identifiable intangible assets or goodwill in conjunction with the acquisition. ~~GOODWILL~~Arrowrock ~~AND~~will ~~OTHER~~be ~~INTANGIBLE~~reported ~~ASSETS~~as part of the Company’s Wholesale Segment.

~~Goodwill~~Identifiable atassets ~~December~~acquired ~~2024~~are ~~and September 2024 was~~ as follows:


	December		September
Accounts receivable	$	12,375
	2024		2024
Inventories		2,998,299
Wholesale Segment	$	5,778,325	$	5,778,325
Prepaid and other assets		1,789
Property and equipment - Land		597,700
Property and equipment - Building		2,466,364
Property and equipment - Vehicles		55,000
Total identifiable net assets	$	6,131,527

Total identifiable net assets	$	6,131,527
Goodwill		—
Total consideration	$	6,131,527

~~Other~~Accounts ~~intangible~~receivable ~~assets~~was recorded at ~~December~~its ~~2024~~fair ~~and~~value ~~September~~representing ~~2024~~the ~~consisted~~amount we expect to collect, which also approximated the gross contractual value of such receivables at the ~~following:~~acquisition date.


	December		September
	2024		2024
Customer lists (Wholesale Segment) (less accumulated amortization of $0.5 million at December 2024 and $0.5 million at September 2024)	$	2,938,815	$	2,996,348
Non-competition agreements (Wholesale Segment) (less accumulated amortization of $0.2 million at December 2024 and $0.2 million at September 2024)		83,255		106,505
Tradename (Wholesale Segment) (less accumulated amortization of $0.4 million at December 2024 and $0.4 million at September 2024)		1,090,738		1,144,381
Trademarks and tradenames (Retail Segment)		500,000		500,000
	$	4,612,808	$	4,747,234

The following table sets forth the unaudited supplemental financial data for Arrowrock from the acquisition date through March 2025, which is included in the Company’s consolidated results for the three and six months ended March 2025.

Goodwill and Retail Segment trademarks and tradenames are considered to have indefinite useful lives and therefore no amortization has been taken on these assets. Goodwill recorded on the Company’s consolidated balance sheets represent amounts allocated to its wholesale reporting unit which totaled approximately $5.8 million at both December 2024 and September 2024. The Company performs its annual impairment testing during the fourth fiscal quarter of each year or as circumstances change or necessitate. There have been no material changes to the Company’s impairment assessments since its fiscal year ended September 2024.


Revenue	$	5,598,721
Net loss available to common shareholders	$	(63,963)

AtThe ~~December~~following ~~2024,~~table ~~identifiable~~presents ~~intangible~~unaudited ~~assets~~supplemental ~~considered~~pro toforma ~~have~~information ~~finite~~assuming ~~lives~~the ~~were~~Company ~~represented~~acquired byArrowrock, ~~customer~~Burklund ~~lists~~Distributors, ~~which~~Inc. ~~are~~and ~~being~~Richmond ~~amortized~~Master ~~over 15 years~~Distributors, aInc. ~~non-competition~~on ~~agreement~~October ~~which~~1, is2023, ~~being~~in ~~amortized~~addition ~~over~~to ~~three~~holding ~~years,~~ a ~~non-competition~~76% ~~agreement~~interest ~~which~~in isTeam ~~being~~Sledd ~~amortized~~on ~~over~~October ~~five years~~1, ~~and a tradename in our Wholesale Segment that is being amortized over seven years~~2023. These ~~intangible~~pro ~~assets~~forma ~~are~~amounts ~~evaluated~~do ~~for~~not ~~accelerated~~purport ~~attrition~~to orbe ~~amortization~~indicative ~~adjustments~~of ifthe ~~warranted.~~actual ~~Amortization~~results ~~expense~~that ~~related~~would tohave ~~these~~been ~~assets~~obtained ~~was~~had ~~approximately $0.1 million for each of~~ the ~~three-month~~acquisitions ~~periods~~occurred ~~ended~~at ~~December~~that ~~2024 and December 2023~~time.

Estimated future amortization expense related to identifiable intangible assets with finite lives was as follows at December 2024:


	For the three months ended March 2025		For the three months ended March 2024		For the six months ended March 2025		For the six months ended March 2024
Revenue	$	620,521,036	$	664,670,461	$	1,339,474,585	$	1,376,384,687
Net income (loss) available to common shareholders	$	(1,602,771)	$	301,966	$	(1,336,819)	$	1,503,104


	December
	2024
Fiscal 2025 (1)	$	372,444
Fiscal 2026		463,703
Fiscal 2027		463,703
Fiscal 2028		451,043
Fiscal 2029		444,703
Fiscal 2030 and thereafter		1,917,212
	$	4,112,808

(1) Represents amortization for the remaining nine months of Fiscal 2025.

3. INVENTORIES

Inventories in our Wholesale Segment consisted of finished goods and are stated at the lower of cost or net realizable value, utilizing FIFO and average cost methods. Inventories in our Retail Segment consisted of finished goods and are stated at the lower of cost or market using the retail method. The wholesale distribution and retail health food segment inventories consist of finished products purchased in bulk quantities to be redistributed to the Company’s customers or sold at retail. Finished goods included total reserves of approximately $1.2 million at both March 2025 and September 2024. These reserves include the Company’s obsolescence allowance, which reflects estimated unsalable or non-refundable inventory based upon an evaluation of slow-moving and discontinued products.

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4. ~~DIVIDENDS~~GOODWILL AND OTHER INTANGIBLE ASSETS

~~The~~Goodwill ~~Company~~at ~~paid~~March ~~cash dividends on its common stock totaling $0.1 million in each of the three-month periods ended December 2024 and December 2023. During Q1~~ 2025, ~~the Company declared a $0.28 per share special dividend totaling approximately $0.2 million that was included in accrued expenses on the condensed consolidated balance sheet at December 2024~~ and ~~will~~September ~~be paid in Q2 2025. During Q1~~ 2024, ~~the Company declared a $0.28 per share special dividend totaling approximately $0.2 million that~~ was ~~paid~~as ~~in Q2 2024.~~follows:

5. EARNINGS PER SHARE


	March		September
	2025		2024
Wholesale Segment	$	5,778,325	$	5,778,325

~~Basic~~Other ~~earnings~~intangible ~~per~~assets ~~share~~at ~~available~~March to2025 ~~common~~and ~~shareholders~~September is2024 ~~calculated~~consisted ~~by dividing net income available to common shareholders by the weighted average number~~ of ~~common shares outstanding for each period. Diluted earnings per share available to common shareholders is calculated by dividing net income available to common shareholders by~~ the ~~sum of the weighted average number of common shares outstanding and the weighted average dilutive equity awards.~~following:


	~~For the three months ended December~~March		September
	~~2024~~2025		2024		~~2023~~
	Basic		Diluted		Basic		Diluted
Customer lists (Wholesale Segment) (less accumulated amortization of $0.6 million at March 2025 and $0.5 million at September 2024)	$	2,881,282	$	2,996,348
Weighted average number of common shares outstanding		611,322		611,322		595,623		595,623
Non-competition agreements (Wholesale Segment) (less accumulated amortization of $0.3 million at March 2025 and $0.2 million at September 2024)		60,006		106,505
Weighted average net additional shares outstanding assuming dilutive options exercised and proceeds used to purchase treasury stock (1)		—		2,251		—		7,677
Tradename (Wholesale Segment) (less accumulated amortization of $0.5 million at March 2025 and $0.4 million at September 2024)		1,037,095		1,144,381
Weighted average number of shares outstanding		611,322		613,573		595,623		603,300
Trademarks and tradenames (Retail Segment)		500,000		500,000
Net income available to common shareholders	$	348,419	$	348,419	$	1,070,961	$	1,070,961
	$	4,478,383	$	4,747,234

Net earnings per share available to common shareholders	$	0.57	$	0.57	$	1.80	$	1.78

~~(1)~~Goodwill ~~Diluted~~and ~~earnings~~Retail ~~per~~Segment ~~share~~trademarks ~~calculation~~and ~~includes~~tradenames ~~all~~are ~~equity-based~~considered ~~awards~~to ~~deemed~~have indefinite useful lives and therefore no amortization has been taken on these assets. Goodwill recorded on the Company’s consolidated balance sheets represent amounts allocated to beits ~~dilutive~~wholesale reporting unit which totaled approximately $5.8 million at both March 2025 and September 2024. The Company performs its annual impairment testing during the fourth fiscal quarter of each year or as circumstances change or necessitate. There have been no material changes to the Company’s impairment assessments since its fiscal year ended September 2024.

At March 2025, identifiable intangible assets considered to have finite lives were represented by customer lists which are being amortized over 15 years, a non-competition agreement which is being amortized over three years, a non-competition agreement which is being amortized over five years, and a tradename in our Wholesale Segment that is being amortized over seven years. These intangible assets are evaluated for accelerated attrition or amortization adjustments if warranted. Amortization expense related to these assets was approximately $0.1 million and $0.3 million for the three- and six-month periods ended March 2025, respectively, and approximately $0.1 million and $0.3 million for the three- and six-month periods ended March 2024, respectively.

6.Estimated ~~DEBT~~future amortization expense related to identifiable intangible assets with finite lives was as follows at March 2025:

The Company primarily finances its operations through three credit facility agreements (a) a facility that is an obligation of AMCON Distributing Company (the “AMCON Facility”), (b) a facility that is an obligation of Team Sledd (the “Team Sledd Facility”) and (c) a facility that is an obligation of Henry’s (the “Henry’s Facility” and, collectively, the “Facilities”) and long-term debt agreements with banks. The Team Sledd Facility and the Henry’s Facility are non-recourse to AMCON Distributing Company, are not guaranteed by AMCON Distributing Company and have no cross default provisions applicable to AMCON Distributing Company. In Q1 2025, the Company amended the Henry’s Facility, increasing its aggregate borrowing capacity from $40.0 million to $45.0 million and extending the maturity date to February 2028. In Q1 2025, the Company amended the Team Sledd Facility to designate the Secured Overnight Financing Rate (“SOFR”) as the primary borrowing rate.


	March
	2025
Fiscal 2025 (1)	$	238,019
Fiscal 2026		463,703
Fiscal 2027		463,703
Fiscal 2028		451,043
Fiscal 2029		444,703
Fiscal 2030 and thereafter		1,917,212
	$	3,978,383

(1)	Represents amortization for the remaining six months of Fiscal 2025.

At December 2024, the Facilities had a total combined borrowing capacity of $305.0 million, which includes provisions for up to $30.0 million in credit advances for certain inventory purchases, which are limited by accounts receivable and inventory qualifications, and the value of certain real estate collateral. The AMCON Facility matures in June 2027, the Henry’s Facility matures in February 2028, and the Team Sledd Facility matures in March 2028, each without a penalty for prepayment. Obligations under the Facilities are collateralized by substantially all of the Company’s respective equipment, intangibles, inventories, accounts receivable, and certain real estate. The Facilities each feature an unused commitment fee and springing financial covenants. Borrowings under the Facilities bear interest at SOFR, plus any applicable spreads.

The amount available for use from the Facilities at any given time is subject to a number of factors, including eligible accounts receivable and inventory balances that fluctuate day-to-day, as well as the value of certain real estate collateral. Based on the collateral and loan limits as defined in the Facility agreements, the credit limit of the combined Facilities at December 2024 was $247.5 million, of which $165.9 million was outstanding, leaving $81.6 million available.

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The average interest rate of the Facilities was 5.96% at December 2024. For the three months ended December 2024, the peak borrowings under the Facilities was $197.1 million, and the average borrowings and average availability under the Facilities was $162.1 million and $73.4 million, respectively.

~~Cross~~5. ~~Default and Co-Terminus Provisions~~DIVIDENDS

~~Team~~The ~~Sledd’s~~Company ~~two~~paid ~~notes~~cash ~~payable~~dividends ~~and~~on ~~the~~its ~~Team~~common ~~Sledd~~stock ~~Facility~~totaling ~~contain cross default provisions~~$0.3 ~~The~~million ~~Henry’s note payable~~ and ~~the Henry’s Facility contain cross default provisions~~$0.4 ~~There~~million ~~were no such cross defaults~~ for ~~either Team Sledd or Henry’s at December 2024. Additionally,~~ the ~~Team~~three- ~~Sledd Facility~~ and ~~the Henry’s Facility are non~~six-~~recourse~~month toperiods ~~AMCON~~ended ~~Distributing~~March ~~Company~~2025, ~~are~~respectively, ~~not guaranteed by AMCON Distributing Company~~ and ~~have no cross default provisions applicable to AMCON Distributing Company~~$0.3 ~~The~~million ~~Company~~ and ~~its~~$0.4 ~~subsidiaries,~~million ~~including~~for ~~Team~~the ~~Sledd~~three- and ~~Henry’s,~~six-month ~~were~~periods inended ~~compliance~~March ~~with all of the financial covenants under the respective Facilities at December~~ 2024, respectively.

~~Other~~6. EARNINGS (LOSS) PER SHARE

~~The~~Basic ~~Company~~earnings ~~has~~(loss) ~~issued~~per ~~letters~~share available to common shareholders is calculated by dividing net income (loss) available to common shareholders by the weighted average number of ~~credit~~common ~~totaling~~shares $2outstanding for each period.0 ~~million~~Diluted earnings (loss) per share available to ~~its~~common ~~workers’~~shareholders ~~compensation~~is ~~insurance~~calculated ~~carriers~~by asdividing ~~part~~net income (loss) available to common shareholders by the sum of ~~its~~the ~~self-insured~~weighted ~~loss~~average ~~control~~number ~~program~~of common shares outstanding and the weighted average dilutive equity awards.

7. INCOME TAXES


	For the three months ended March
	2025				2024
	Basic		Diluted		Basic		Diluted
Weighted average number of common shares outstanding		615,261		615,261		600,161		600,161
Weighted average net additional shares outstanding assuming dilutive options exercised and proceeds used to purchase treasury stock (1)		—		—		—		7,868
Weighted average number of shares outstanding		615,261		615,261		600,161		608,029
Net income (loss) available to common shareholders	$	(1,589,960)	$	(1,589,960)	$	539,543	$	539,543

Net earnings (loss) per share available to common shareholders	$	(2.58)	$	(2.58)	$	0.90	$	0.89

~~The~~(1) ~~change~~Diluted inearnings ~~the~~(loss) ~~Company’s~~per ~~effective~~share ~~income~~calculation ~~tax~~includes ~~rate~~all ~~for the three~~equity-~~month~~based ~~period~~awards ~~ended~~deemed ~~December 2024 as compared~~ to ~~the~~be respective prior year period was primarily related to non-deductible compensation expense in relation to the amount of income from operations before income tax expense and variances in the average effective state income tax rates between the comparative periodsdilutive.

8. FAIR VALUE DISCLOSURES


	For the six months ended March
	2025				2024
	Basic		Diluted		Basic		Diluted
Weighted average number of common shares outstanding		613,270		613,270		597,879		597,879
Weighted average net additional shares outstanding assuming dilutive options exercised and proceeds used to purchase treasury stock (1)		—		—		—		8,038
Weighted average number of shares outstanding		613,270		613,270		597,879		605,917
Net income (loss) available to common shareholders	$	(1,241,541)	$	(1,241,541)	$	1,610,504	$	1,610,504

Net earnings (loss) per share available to common shareholders	$	(2.02)	$	(2.02)	$	2.69	$	2.66

~~Mandatorily~~(1) ~~Redeemable~~Diluted ~~Non~~earnings (loss) per share calculation includes all equity-~~Controlling~~based ~~Interest~~awards deemed to be dilutive.

Mandatorily redeemable non-controlling interest (“MRNCI”) recorded on the Company’s condensed consolidated balance sheets represents the fair value of the non-controlling interest in the Company’s strategic investment in Team Sledd. The Company owned approximately 76% of Team Sledd as of both December 2024 and September 2024. The Company has elected to present the MRNCI liability at fair value under Accounting Standards Codification (“ASC”) 825 – Financial Instruments as it believes this best represents the potential future liability and cash flows. As such, the MRNCI balance at December 2024 represents the fair value of the remaining future membership interest redemptions and other amounts due to noncontrolling interest holders through April 2026. The Company calculates the estimated fair value of the MRNCI based on a discounted cash flow valuation technique using the best information available at the reporting date, and records changes in the fair value of the MRNCI as a component of other expense (income) in the condensed consolidated statements of operations. The MRNCI is classified as Level 3 because of the Company’s reliance on unobservable assumptions. The Company estimates the probability and timing of future redemptions and earnings of Team Sledd based on management’s knowledge and assumptions of certain events as of each reporting date, including the timing of any future redemptions and an appropriate discount rate, which was 13.2% at December 2024. At December 2024 and September 2024, the difference between the contractual amount due under the MRNCI and the fair value was approximately $0.6 million and $0.7 million, respectively.

A7. ~~summary of the MRNCI activity is as follows:~~DEBT


	For the Three Months Ended December 31,
	2024		2023
Fair value, beginning of period	$	8,211,500	$	9,490,831
Redemption of non-controlling interests		—		—
Distributions to non-controlling interest		—		—
Change in fair value		194,812		199,744
Fair value, end of period	$	8,406,312	$	9,690,575

At March 2025, the Facilities had a total combined borrowing capacity of $305.0 million, which includes provisions for up to $30.0 million in credit advances for certain inventory purchases, which are limited by accounts receivable and inventory qualifications, and the value of certain real estate collateral. The AMCON Facility matures in June 2027, the

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~~Contingent~~Henry’s ~~Consideration~~Facility matures in February 2028, and the Team Sledd Facility matures in March 2028, each without a penalty for prepayment. Obligations under the Facilities are collateralized by substantially all of the Company’s respective equipment, intangibles, inventories, accounts receivable, and certain real estate. The Facilities each feature an unused commitment fee and springing financial covenants. Borrowings under the Facilities bear interest at the Secured Overnight Financing Rate (“SOFR”), plus any applicable spreads.

OnThe ~~April~~amount 5,available ~~2024,~~for ~~the~~use ~~Company~~from ~~acquired substantially all of~~ the ~~net~~Facilities ~~operating~~at ~~assets~~any ofgiven ~~Burklund~~time ~~Distributors,~~is ~~Inc.~~subject ~~(“Burklund”).~~to Aa ~~portion~~number of ~~the~~factors, ~~consideration~~including ~~exchanged~~eligible inaccounts ~~the~~receivable ~~acquisition~~and ofinventory ~~Burklund~~balances ~~was in the form of contingent consideration of up to $3.0 million in cash~~ that ~~could~~fluctuate ~~be payable in two installments on the one~~day-~~year and two~~to-~~year anniversaries of the acquisition date based on certain sales thresholds. In accordance with ASC 805~~day, ~~the~~as ~~Company~~well ~~recorded~~as the ~~contingent consideration at fair~~ value as of ~~the~~certain ~~acquisition~~real ~~date~~estate ~~and re-measures the liability at each reporting period~~collateral. ~~The~~Based ~~Company calculates the estimated fair value of the contingent consideration based~~ on ~~a discounted cash flow valuation technique using~~ the ~~best~~collateral ~~information~~and ~~available~~loan atlimits ~~the~~as ~~reporting~~defined ~~date, and records changes~~ in the ~~fair~~Facility ~~value of the contingent consideration in selling~~agreements, ~~general and administrative expenses in~~ the ~~condensed~~credit ~~consolidated~~limit ~~statements~~ of ~~operations. The short-term and long-term portions of~~ the ~~contingent~~combined ~~consideration~~Facilities ~~are~~at ~~recorded~~March in2025 ~~accrued~~was ~~expenses~~$220.7 ~~and other long-term liabilities~~million, ~~respectively,~~of onwhich ~~the condensed consolidated balance sheets~~$142. ~~The contingent consideration liability is classified as Level~~ 3 ~~because~~million ofwas ~~the~~outstanding, ~~Company’s~~leaving ~~reliance~~$78.4 onmillion ~~unobservable assumptions~~available.

AtThe ~~each~~average ~~reporting~~interest ~~date, the Company reviews certain inputs, including sales thresholds and an appropriate discount~~ rate, ~~based~~of onthe ~~management’s~~Facilities ~~knowledge~~was ~~and~~5.76% ~~assumptions~~at ofMarch ~~certain events~~2025. AsFor ~~of December 2024,~~ the ~~Company~~six ~~determined~~months ~~that~~ended ~~due~~March ~~to current sales trends including customer turnover~~2025, the ~~achievement~~peak ofborrowings ~~the~~under ~~sales thresholds required to meet~~ the ~~minimum~~Facilities ~~payout of any contingent consideration~~ was ~~not probable~~$197.1 ~~As such~~million, ~~the~~and ~~Company adjusted~~ the ~~fair~~average ~~value~~borrowings ofand ~~its~~average ~~contingent~~availability ~~consideration~~under ~~liability~~the ~~and~~Facilities ~~recognized~~was ~~operating~~$158.9 ~~income~~million ofand ~~approximately~~ $173.52 million, ~~which was recorded as a reduction of selling, general and administrative expenses in the condensed consolidated statements of operations~~respectively.

AtCross ~~September~~Default ~~2024, the difference between the estimated amount due under the contingent consideration arrangement~~ and ~~the~~Co-Terminus ~~fair value was approximately $0.2 million.~~ Provisions

Team Sledd’s two notes payable and the Team Sledd Facility contain cross default provisions. The ~~following~~Henry’s ~~table~~note ~~presents~~payable ~~changes~~and inthe Henry’s Facility contain cross default provisions. There were no such cross defaults for either Team Sledd or Henry’s at March 2025. Additionally, the ~~fair~~Team ~~value~~Sledd Facility and the Henry’s Facility are non-recourse to AMCON Distributing Company, are not guaranteed by AMCON Distributing Company and have no cross default provisions applicable to AMCON Distributing Company. The Company and its subsidiaries, including Team Sledd and Henry’s, were in compliance with all of the ~~contingent~~financial ~~consideration~~covenants ~~since~~under ~~September~~the ~~2024:~~respective Facilities at March 2025.


Current portion of contingent consideration at fair value as of September 2024	$	710,270
Long-term portion of contingent consideration at fair value as of September 2024		743,182
Fair value of contingent consideration as of September 2024	$	1,453,452
Change in fair value		(1,453,452)
Fair value of contingent consideration as of December 2024	$	—

Other

The Company has issued letters of credit totaling $3.1 million to its workers’ compensation insurance carriers as part of its self-insured loss control program.

8. INCOME TAXES

9.The ~~EQUITY~~change in the Company’s effective income tax rate for the three-~~BASED~~ ~~INCENTIVE~~and ~~AWARDS~~six-month periods ended March 2025 as compared to the respective prior year periods, was primarily related to non-deductible compensation expense in relation to the amount of income (loss) from operations before income tax expense (benefit) and variances in the average effective state income tax rates between the comparative periods.

The Company has two equity-based incentive plans, the 2018 Omnibus Incentive Plan and the 2022 Omnibus Incentive Plan (collectively the “Omnibus Plans”), which provide for equity incentives to employees9. ~~Each~~FAIR ~~Omnibus~~VALUE Plan is designed with the intent of encouraging employees to acquire a vested interest in the growth and performance of the Company. The Omnibus Plans together permit the issuance of up to 120,000 shares of the Company’s common stock in the form of stock options, restricted stock awards, restricted stock units, performance share awards as well as awards such as stock appreciation rights, performance units, performance shares, bonus shares, and dividend share awards payable in the form of common stock or cash. The number of shares issuable under the Omnibus Plans is subject to customary adjustments in the event of stock splits, stock dividends, and certain other distributions on the Company’s common stock. At December 2024, awards with respect to a total of 83,307 shares, net of forfeitures, have been awarded pursuant to the Omnibus Plans, and awards with respect to another 36,693 shares may be awarded under the Omnibus Plans.DISCLOSURES

Mandatorily Redeemable Non-Controlling Interest

Mandatorily redeemable non-controlling interest (“MRNCI”) recorded on the Company’s condensed consolidated balance sheets represents the fair value of the non-controlling interest in the Company’s strategic investment in Team Sledd. The Company owned approximately 76% of Team Sledd at both March 2025 and September 2024. The Company has elected to present the MRNCI liability at fair value under Accounting Standards Codification 825 – Financial Instruments as it believes this best represents the potential future liability and cash flows. As such, the MRNCI balance at March 2025 represents the fair value of the remaining future membership interest redemptions and other amounts due to noncontrolling interest holders through April 2026. The Company calculates the estimated fair value of the MRNCI based on a discounted cash flow valuation technique using the best information available at the reporting date, and records changes in the fair value of the MRNCI as a component of other expense (income) in the condensed consolidated statements of operations. The MRNCI is classified as Level 3 because of the Company’s reliance on unobservable assumptions. The Company estimates the probability and timing of future redemptions and earnings of Team Sledd based on management’s knowledge and assumptions of certain events as of each reporting date, including the timing of any future redemptions and an appropriate discount rate, which was 13.2% at March 2025. At March 2025 and September 2024, the difference between

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~~Restricted~~the ~~Stock~~contractual ~~Awards~~amount due under the MRNCI and the fair value was approximately $0.6 million and $0.7 million, respectively.

AtA ~~December~~summary ~~2024, the Compensation Committee~~ of the ~~Board~~MRNCI ofactivity ~~Directors~~is ~~had~~as ~~authorized and approved the following restricted stock awards to members of the Company’s management team pursuant to the provisions of the Company’s Omnibus Plans~~follows:


	~~Restricted~~For ~~Stock~~the ~~Awards~~Three ~~(1)~~Months Ended March 31,		~~Restricted Stock Awards (2)~~		~~Restricted Stock Awards (3)~~
Date of award:		October 2022		October 2023		October 2024
	2025		2024
Original number of awards issued:		15,100		15,100		15,100
Fair value, beginning of period	$	8,406,312	$	9,690,575
Service period:		36 months		36 months		36 months
Change in fair value		272,856		134,389
Estimated fair value of award at grant date:	$	2,824,000	$	2,762,000		2,069,000
Fair value, end of period	$	8,679,168	$	9,824,964
Non-vested awards outstanding at December 2024:		5,034		10,067		15,100
Fair value of non-vested awards at December 2024 of approximately:	$	645,000	$	1,290,000		1,935,000

(1) 10,066 of the restricted stock awards were vested as of December 2024. The remaining 5,034 restricted stock awards will vest in October 2025.

(2) 5,033 of the restricted stock awards were vested as of December 2024. 5,033 restricted stock awards will vest in October 2025 and 5,034 will vest in October 2026.

(3) The 15,100 restricted stock awards will vest in equal amounts in October 2025, October 2026 and October 2027.

There is no direct cost to the recipients of the restricted stock awards, except for any applicable taxes. The restricted stock awards provide that the recipients receive common stock in the Company, subject to certain restrictions, until such time as the awards vest. The recipients of the restricted stock awards are entitled to the customary adjustments in the event of stock splits, stock dividends, and certain other distributions on the Company’s common stock. All cash dividends and/or distributions payable to restricted stock recipients will be held in escrow until all the conditions of vesting have been met. The compensation expense recorded in the Company’s Statement of Operations reflects the straight-line amortized fair value.



	For the Six Months Ended March 31,
	2025		2024
Fair value, beginning of period	$	8,211,500	$	9,490,831
Change in fair value		467,668		334,133
Fair value, end of period	$	8,679,168	$	9,824,964

~~The~~During ~~following~~April ~~summarizes~~2025, ~~restricted~~subsequent ~~stock~~to ~~award~~Q2 ~~activity~~2025, ~~under~~certain ~~the~~membership ~~Omnibus~~interests ~~Plans~~in ~~during~~Team Q1Sledd ~~2025:~~were redeemed, which resulted in AMCON’s ownership of Team Sledd’s outstanding equity increasing to approximately 91%.


	Number	Weighted
	of	Average
	Shares	Fair Value
Nonvested restricted stock awards at September 2024	30,201	$	144.95
Granted	15,100		137.00
Vested	(15,100)		135.33
Expired	—		—
Nonvested restricted stock awards at December 2024	30,201	$	128.16

Contingent Consideration

~~Income~~On ~~from~~April ~~operations~~5, ~~before~~2024, ~~income~~the ~~taxes~~Company ~~included~~acquired ~~compensation~~substantially ~~expense~~all ~~related~~of tothe net operating assets of Burklund Distributors, Inc. (“Burklund”). A portion of the ~~amortization~~consideration exchanged in the acquisition of Burklund was in the ~~Company’s~~form ~~restricted~~of ~~stock~~contingent ~~awards~~consideration of ~~approximately~~up to $03.60 million ~~during~~in ~~both~~cash Q1payable ~~2025~~in two installments on the one-year and Q1two-year ~~2024~~anniversaries of the acquisition date based on the achievement of certain sales thresholds. ~~Total~~In ~~unamortized~~accordance ~~compensation~~with ~~expense~~ASC ~~related~~805, tothe ~~these~~Company ~~awards~~recorded this contingent consideration at ~~December~~fair ~~2024~~value as of the acquisition date and ~~September~~re-measures ~~2024~~the ~~was~~liability ~~approximately~~at $4each reporting period.2 ~~million~~The Company calculates the estimated fair value of the contingent consideration based on a discounted cash flow valuation technique using the best information available at the reporting date, and $2records changes in the fair value of the contingent consideration in selling, general and administrative expenses in the condensed consolidated statements of operations.8 ~~million~~The short-term and long-term portions of any contingent consideration payable are recorded in accrued expenses and other long-term liabilities, respectively, in the Company’s condensed consolidated balance sheets. The contingent consideration liability is classified as Level 3 because of the Company’s reliance on unobservable assumptions.

At each reporting date, the Company reviews certain inputs, including sales thresholds and an appropriate discount rate, based on management’s knowledge and assumptions of certain events. In Q1 2025, the Company determined that due to current sales trends including customer turnover, the achievement of the sales thresholds required to meet the minimum payout of any contingent consideration was not probable. As such, the Company adjusted the fair value of its contingent consideration liability and recognized operating income of approximately $1.5 million in Q1 2025, which was recorded as a reduction of selling, general and administrative expenses in the condensed consolidated statements of operations. At March 2025, the Company reaffirmed that the achievement of the sales thresholds required to meet the minimum payout of any contingent consideration was not probable.

At September 2024, the difference between the estimated amount due under the contingent consideration arrangement and the fair value was approximately $0.2 million.

The following table presents changes in the fair value of the contingent consideration since September 2024:


Current portion of contingent consideration at fair value as of September 2024	$	710,270
Long-term portion of contingent consideration at fair value as of September 2024		743,182
Fair value of contingent consideration as of September 2024	$	1,453,452
Change in fair value		(1,453,452)
Fair value of contingent consideration as of March 2025	$	—

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10. BUSINESS SEGMENTS

The Company has two reportable business segments: the wholesale distribution of consumer products (the Wholesale Segment), and the retail sale of health and natural food products (the Retail Segment). The aggregation of the Company’s business operations into these business segments was based on a range of considerations, including but not limited to the characteristics of each business, similarities in the nature and type of products sold, customer classes, methods used to sell the products and economic profiles. Included in the “Other” column are intercompany eliminations and assets held and charges incurred and income earned by our holding company. The segments are evaluated on revenues, gross margins, operating income (loss), and income (loss) from operations before taxes.

Wholesale

Retail

Segment

Other

Consolidated

THREE MONTHS ENDED DECEMBER 2024

THREE MONTHS ENDED MARCH 2025

External revenue:

Cigarettes

~~438~~374,~~021~~341,~~998~~125

—

~~438~~374,~~021~~341,~~998~~125

Tobacco

~~135~~121,~~897~~839,~~478~~251

—

~~135~~121,~~897~~839,~~478~~251

Confectionery

4439,~~033~~765,~~179~~350

—

4439,~~033~~765,~~179~~350

Health food

—

1011,~~525~~902,~~335~~524

—

1011,~~525~~902,~~335~~524

Foodservice & other

8271,~~795~~654,~~266~~837

—

8271,~~795~~654,~~266~~837

Total external revenue

~~700~~607,~~747~~600,~~921~~563

1011,~~525~~902,~~335~~524

—

~~711~~619,~~273~~503,~~256~~087

Depreciation

2,~~236~~056,~~483~~696

~~264~~266,~~692~~906

—

2,~~501~~323,~~175~~602

Amortization

134,~~426~~425

—

134,~~426~~425

Operating income (loss)

62,~~551~~821,~~532~~616

~~(330~~430,~~822)~~846

(2,~~550~~790,~~389~~557)

3461,~~670,321~~905

Interest expense

—

2,~~846~~266,~~621~~407

Income (loss) from operations before taxes

62,~~445~~582,~~335~~199

~~(307~~453,~~907)~~806

(5,~~397~~056,~~009~~965)

~~740~~(2,~~419~~020,960)

Total assets

~~386~~373,~~653~~458,~~248~~943

1617,~~815~~342,~~247~~095

1,~~200~~202,~~775~~999

~~404~~392,~~669~~004,~~270~~037

Capital expenditures

32,~~109~~859,~~807~~192

99207,~~776~~068

—

3,~~209~~066,~~583~~260

Wholesale

Retail

Segment

Other

Consolidated

THREE MONTHS ENDED DECEMBER 2023

THREE MONTHS ENDED MARCH 2024

External revenue:

Cigarettes

~~395~~367,~~668~~878,~~708~~538

—

~~395~~367,~~668~~878,~~708~~538

Tobacco

~~121~~114,~~351~~832,~~701~~151

—

~~121~~114,~~351~~832,~~701~~151

Confectionery

4037,~~043~~862,~~130~~439

—

4037,~~043~~862,~~130~~439

Health food

—

1011,~~689~~224,~~429~~329

—

1011,~~689~~224,~~429~~329

Foodservice & other

7770,~~206~~079,~~105~~849

—

7770,~~206~~079,~~105~~849

Total external revenue

~~634~~590,~~269~~652,~~644~~977

1011,~~689~~224,~~429~~329

—

~~644~~601,~~959~~877,~~073~~306

Depreciation

1,~~855~~940,~~746~~843

~~228~~214,~~997~~121

—

2,~~084~~154,~~743~~964

Amortization

134,~~425~~426

—

134,~~425~~426

Operating income (loss)

65,~~970~~813,~~125~~354

~~(16~~456,~~476)~~722

(32,~~130~~926,~~572~~413)

3,~~823~~343,~~077~~663

Interest expense

—

2,~~311~~247,~~513~~737

Income (loss) from operations before taxes

65,~~775~~843,~~098~~163

~~541~~483,~~948~~530

(5,~~442~~174,~~085~~150)

1,~~874~~152,~~961~~543

Total assets

~~345~~318,~~011~~821,~~110~~274

16,~~574~~312,~~317~~547

~~787~~1,~~500~~023,048

~~362~~336,~~372~~156,~~927~~869

Capital expenditures

2,980,331

299,169

—

3,279,500

Capital expenditures (1)

14,230,776

726,494

—

14,957,270

11(1) Includes $10.0 ~~SUBSEQUENT~~million ~~EVENT~~purchase of a distribution facility in Colorado City, Colorado.

On January 17, 2025, the Company closed on its previously disclosed acquisition of Arrowrock Supply (“Arrowrock”). The Company paid approximately $6.1 million in cash for substantially all of the net operating assets of Arrowrock, primarily consisting of inventory and Arrowrock’s distribution center in Boise, Idaho.14

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	Wholesale		Retail
	Segment		Segment		Other		Consolidated
SIX MONTHS ENDED MARCH 2025
External revenue:
Cigarettes	$	812,363,123	$	—	$	—	$	812,363,123
Tobacco		257,736,729		—		—		257,736,729
Confectionery		83,798,529		—		—		83,798,529
Health food		—		22,427,859		—		22,427,859
Foodservice & other		154,450,104		—		—		154,450,104
Total external revenue		1,308,348,485		22,427,859		—		1,330,776,344
Depreciation		4,293,179		531,598		—		4,824,777
Amortization		268,851		—		—		268,851
Operating income (loss)		9,373,148		100,024		(5,340,947)		4,132,225
Interest expense		—		—		5,113,028		5,113,028
Income (loss) from operations before taxes		9,027,534		145,899		(10,453,974)		(1,280,541)
Total assets		373,458,943		17,342,095		1,202,999		392,004,037
Capital expenditures		5,968,999		306,844		—		6,275,843


	Wholesale		Retail
	Segment		Segment		Other		Consolidated
SIX MONTHS ENDED MARCH 2024
External revenue:
Cigarettes	$	763,547,247	$	—	$	—	$	763,547,247
Tobacco		236,183,852		—		—		236,183,852
Confectionery		77,905,569		—		—		77,905,569
Health food		—		21,913,758		—		21,913,758
Foodservice & other		147,285,954		—		—		147,285,954
Total external revenue		1,224,922,622		21,913,758		—		1,246,836,380
Depreciation		3,796,589		443,118		—		4,239,707
Amortization		268,851		—		—		268,851
Operating income (loss)		12,783,479		440,246		(6,056,985)		7,166,740
Interest expense		—		—		4,559,250		4,559,250
Income (loss) from operations before taxes		12,618,261		1,025,478		(10,616,235)		3,027,504
Total assets		318,821,274		16,312,547		1,023,048		336,156,869
Capital expenditures (1)		17,211,107		1,025,663		—		18,236,770

14(1) Includes $10.0 million purchase of a distribution facility in Colorado City, Colorado.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

BUSINESS UPDATE

~~Our~~In ~~business~~mid-January ~~continues~~2025, tothe beCompany ~~impacted~~closed byon ~~macroeconomic~~its ~~factors~~previously ~~and~~disclosed ~~certain~~acquisition ~~manufacturer supply chain limitations. The cumulative effect~~ of ~~sustained~~Arrowrock ~~inflation~~Supply ~~across~~(“Arrowrock”), ~~various~~located ~~consumer~~in ~~product~~Boise, ~~categories~~Idaho, ~~has~~expanding ~~impacted discretionary spending and~~ the ~~related~~Company’s ~~retail~~reach ~~level~~into ~~demand for~~ the ~~convenience~~Inter-Mountain ~~store~~region ~~customers we serve. These same inflationary pressures have also increased our operating costs, particularly as it relates to labor, equipment, insurance, interest, and the cost~~ of the ~~products~~United ~~we sell~~States.

WeSimilar ~~continue~~ to ~~closely~~other ~~monitor~~retail ~~regulatory~~formats, ~~actions~~the ~~and~~convenience ~~proposals~~retailing ~~from~~sector ~~federal~~which ~~and~~we ~~state~~serve ~~governmental~~continues ~~and~~to ~~regulatory~~experience ~~bodies,~~a ~~including~~challenging ~~the~~operating ~~United~~environment ~~States~~with ~~Food~~consumer behavior and ~~Drug~~discretionary ~~Administration~~spending ~~(“FDA”),~~lagging. ~~which~~At ~~is evaluating~~ the ~~possible~~same ~~prohibition~~time, ~~and/or limitations on~~ the ~~sale~~cost ofstructures ~~certain~~for ~~cigarette,~~wholesale ~~e-cigarette,~~distributors ~~tobacco,~~such ~~and~~as ~~vaping~~our ~~products,~~Company ~~including~~have ~~menthol~~been ~~cigarettes.~~impacted Ifby ~~such~~the ~~further~~cumulative ~~regulations~~impact orof ~~further~~inflation ~~product~~over ~~sale~~a ~~limitations~~multi-year ~~were~~period. toThese beinflationary ~~implemented,~~pressures ~~they~~have ~~may~~resulted ~~limit~~in ~~the~~higher ~~range~~operating ofcosts ~~products~~in weareas ~~are~~such ~~able~~as ~~to sell in related~~ product ~~categories~~costs, labor and ~~decrease~~employee ~~overall~~benefits, ~~consumer~~equipment, ~~demand.~~and ~~Any~~insurance, ~~such~~resulting ~~changes~~in ~~may~~additional ~~negatively~~consolidation ~~impact~~across our ~~revenues,~~entire ~~gross margins, and financial results~~industry.

~~The~~We ~~Company~~are ~~continues~~closely tomonitoring ~~make~~the ~~targeted~~fluid ~~investments~~nature inof ~~conjunction~~proposed ~~with~~tariffs ~~its~~and ~~long-term~~any ~~growth~~impact ~~strategy~~they may have on our operations. Additionally, ~~Integration~~we ~~work~~remain ~~continues~~focused on ~~the~~proposals ~~recent~~from ~~acquisitions~~federal ofand ~~Burklund~~state ~~Distributors~~governmental and other regulatory bodies, ~~Inc.~~including ~~(“Burklund”)~~the ~~and~~United ~~Richmond~~States ~~Master~~Food ~~Distributors,~~and ~~Inc.~~Drug Administration (“~~Richmond Master~~FDA”)., ~~These~~which ~~acquisitions~~is ~~play~~evaluating athe ~~central~~possible ~~role~~prohibition inand/or limitation on the ~~Company’s~~sale ~~long~~of certain cigarette, e-~~term~~cigarette, ~~geographic~~tobacco, ~~expansion~~and ~~initiatives~~vaping products, ~~expand~~including ~~the~~menthol ~~Company’s~~cigarettes. ~~regional~~If ~~footprint~~such ~~and~~proposed ~~will~~tariffs ~~provide~~and/or ~~customers~~federal/state ~~with~~regulatory anactions ~~enhanced~~limit ~~range~~or ofprohibit certain products we can sell in these categories, our revenues, gross margins, and ~~services~~financial ~~over~~results ~~time~~may be negatively impacted.

In response to this operating environment, the Company has made a number of strategic investments to enhance its competitive position over time. These strategic investments include, but are not limited to, expanding the depth of our foodservice programs and facilities, the completion of a number of tuck-in acquisitions which have expanded our coverage footprint and ability to service growth-oriented customers, the expansion of our consumer products advertising, design, and electronic display programs, and continued investments in our own proprietary technology solutions. Our Company now ranks as the third largest Convenience Distributor in the United States as measured by territory covered providing an attractive geographic platform to accommodate future growth opportunities.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including the Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections, contains forward-looking statements that are subject to risks and uncertainties and reflect management’s current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. Forward-looking statements include information concerning the possible or assumed future results of operations of the Company and those statements preceded by, followed by or that include the words “future,” “position,” “anticipate(s),” “expect(s),” “believe(s),” “see,” “plan,” “further improve,” “outlook,” “should” or similar expressions. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future performance or results. They involve risks, uncertainties and assumptions.

It should be understood that the following important factors, in addition to those discussed elsewhere in this document, could affect the future results of the Company and could cause those results to differ materially from those expressed in our forward-looking statements:

● ~~risks~~the ~~associated~~potential ~~with~~impact ~~continued~~that ~~weakness~~ongoing or proposed increases in ~~retail~~trade ~~level~~tariffs ~~demand~~and/or ~~within~~changes to trade policies may have on raw materials or finished goods sourced from abroad which could result in higher prices for the ~~convenience~~products ~~store~~we ~~industry~~sell while also decreasing consumer disposable income and demand,

● risks associated with ~~workforce~~new ~~availability~~tariffs ~~and/~~or ~~wage~~other ~~pressures~~macro-economic ~~which~~factors ~~may~~as beit ~~impacted~~relates byto ~~economic~~inflation, ~~conditions~~operating costs, ~~changes~~and inoverall ~~governmental~~business ~~policy~~risk, orparticularly ~~other~~product ~~changes~~and inequipment ~~the~~costs, ~~operating~~wages, ~~environment~~fuel, ~~which~~interest, ~~may~~food ~~impact~~ingredient and commodity prices, and customer credit risk, and limits on our ~~labor~~ability ~~force~~to pass on higher operating costs,

●	risks associated with continued weakness in retail level demand within the convenience store industry including declining demand for cigarette products,

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●	risks associated with workforce availability and/or wage pressures which may be impacted by economic conditions, changes in governmental policies, or other changes in the operating environment which may impact our labor force,

●

risks associated with all forms of insurance renewals and the risk that the Company may not be able to renew various insurance with adequate levels of coverage, at favorable rates, or obtain insurance at all based upon market conditions within the insurance industry and/or because of the industry in which the Company operates,

●	risks associated with unrest in certain global regions which could further disrupt world supply chains, manufacturing centers, and shipping routes, impacting commodity/product availability and/or cost, as well as consumer demand trends,

●

risks associated with higher interest rates or prolonged periods of higher interest rates and the related impact on demand, customer credit risk, profitability and cash flows for both the Company and its customer base, particularly as it relates to variable interest rate borrowings, as well as the risk that such borrowings may not be renewed in the future on favorable terms or at all,

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●	risks associated with any systemic pressures in the banking system, particularly as they relate to customer credit risk and any resulting impact on our cash flow and our ability to collect on our receivables,

● risks associated with an inflationary operating environment, particularly as it relates to wages, fuel, interest, commodity prices, and customer credit risk, which impact our operating cost structure and could impact food ingredient costs and demand for many of the products we sell,

●

regulations, potential bans, limitations and/or litigation related to the manufacturing, distribution, and sale of certain cigarette, e-cigarette, tobacco, and vaping products imposed by the FDA, state or local governmental agencies, or other parties, including proposed and pending regulations and/or product approvals/authorizations related to the manufacturing, distribution, and sale of certain menthol, vaping, and flavored tobacco products, including proposed rules which would limit nicotine levels in certain cigarette and tobacco products,

●

risks associated with the threat or occurrence of epidemics or pandemics (such as COVID-19 or its variants) or other public health issues, including the continued health of our employees and management, the reduced demand for our goods and services or increased credit risk from customer credit defaults resulting from an economic downturn,

●	risks associated with the imposition of governmental orders restricting our operations and the operations of our suppliers and customers, in particular, disruptions to our supply chain or our ability to procure products or fulfill orders due to labor shortages in our warehouse operations,

●	risks associated with events such as the COVID-19 pandemic, during which the Company experienced both higher sales volumes and labor costs but then subsequently experienced a decline in sales volumes, with limited ability to offset or pass on higher operating costs,

●

risks associated with the acquisition of businesses or assets, capital asset expenditure projects by either of our business segments such as the development of new facilities/locations or upgrades to distribution centers or retail stores, including, but not limited to, risks associated with consummating such transactions on expected terms or timing, purchase price and business valuation and recording risks, customer turnover and retention risks, and risks related to the assumption of certain liabilities or obligations,

●

risks associated with the integration of new businesses or equity investments by either of our business segments including, but not limited to, risks associated with vendor and customer turnover and retention, technology integration, and the potential loss of any key management personnel or employees,

●	increasing competition and market conditions in our wholesale and retail health food businesses and any associated impact on the carrying value and any potential impairment of assets (including intangible assets) within those businesses,

●	risk that our repositioning strategy for our retail business will not be successful,

●	risks associated with opening new, or closing unprofitable, retail stores,

●	risks to our brick and mortar retail business and potentially to our wholesale distribution business if online shopping formats such as Amazon™ continue to grow in popularity and further disrupt traditional sales channels,

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● the potential impact that ongoing or proposed increases in trade tariffs and/or changes to trade policies may have on raw materials or finished goods sourced from abroad which could result in higher prices for the products we sell while also decreasing consumer disposable income and demand,

●	increasing product and operational costs resulting from ongoing supply chain disruptions, an intensely competitive labor market with a limited pool of qualified workers, and higher incremental costs associated with the handling and transportation of certain product categories such as foodservice,

●	increases in state and federal excise taxes on cigarette and tobacco products and the potential impact on demand, particularly as it relates to current legislation under consideration which could significantly increase such taxes,

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●	risks associated with disruptions to our technology systems or those of third parties upon which we rely, including security breaches, cyber and ransomware attacks, malware, or other methods by which such information systems could or may have been compromised or impacted,

●	increases in inventory carrying costs and customer credit risks,

●	changes in pricing strategies and/or promotional/incentive programs offered by cigarette and tobacco manufacturers,

●	changing demand for the Company’s products, particularly cigarette, tobacco and vaping products,

●	risks that product manufacturers may begin selling directly to convenience stores and bypass wholesale distributors,

●	changes in laws and regulations and ongoing compliance related to health care and associated insurance,

●	increasing health care costs for both the Company and consumers and its potential impact on discretionary consumer spending,

●	decreased availability of capital resources,

●	domestic regulatory and legislative risks,

●	poor weather conditions, and the adverse effects of climate change including, but not limited to, wildfires and violent storms

●	consolidation trends within the convenience store, wholesale distribution, and retail health food industries,

●	risks associated with labor disputes (strikes), natural disasters, domestic/political unrest and incidents of violence, or any restrictions, regulations, or security measures implemented by governmental bodies in response to these items, and

●	other risks over which the Company has little or no control, and any other factors not identified herein.

Changes in these factors could result in significantly different results. Consequently, future results may differ from management’s expectations. Moreover, past financial performance should not be considered a reliable indicator of future performance. Any forward-looking statement contained herein is made as of the date of this document. Except as required by law, the Company undertakes no obligation to publicly update or correct any of these forward-looking statements in the future to reflect changed assumptions, the occurrence of material events or changes in future operating results, financial conditions or business over time.

CRITICAL ACCOUNTING ESTIMATES

Certain accounting estimates used in the preparation of the Company’s condensed consolidated unaudited financial statements (“financial statements”) require us to make judgments and estimates and the financial results we report may vary depending on how we make these judgments and estimates. Our critical accounting estimates are set forth in our annual report on Form 10-K for the fiscal year ended September 30, 2024, as filed with the Securities and Exchange Commission. There have been no significant changes with respect to these estimates and related policies during the ~~three~~six months ended ~~December~~March ~~2024~~2025.

1718

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~~FIRST~~SECOND FISCAL QUARTER 2025 (Q1Q2 2025)

The following discussion and analysis includes the Company’s results of operations for the three and six months ended ~~December~~March ~~2024~~2025 and ~~December~~March ~~2023~~2024:

Wholesale Segment

Retail Segment

Our Retail Segment, through our Healthy Edge Retail Group subsidiary, is a specialty retailer of natural/organic groceries and operates 15 retail health food stores under the Chamberlin’s Natural Foods, Akin’s Natural Foods, and Earth Origins Market banners. We operate within the natural products retail industry, which is a subset of the United States grocery industry. This industry includes conventional, natural, gourmet and specialty food markets, mass and discount retailers, warehouse clubs, health food stores, dietary supplement retailers, drug stores, farmers markets, mail order and online retailers, and multi-level marketers. These stores carry over 32,000 different nationally and regionally branded and private label products including high-quality natural, organic, and specialty foods consisting of produce, baked goods, frozen foods, nutritional supplements, personal care items, and general merchandise.

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RESULTS OF OPERATIONS – THREE MONTHS ENDED ~~DECEMBER~~MARCH:


	~~2024~~2025			~~2023~~2024			Incr (Decr)		% Change
CONSOLIDATED:
Sales (1)	$	~~711~~619,~~273~~503,~~256~~087		$	~~644~~601,~~959~~877,~~073~~306		$	6617,~~314~~625,~~183~~781	102.39
Cost of sales		~~664~~576,~~379~~475,~~704~~202			~~601~~559,~~658~~566,~~151~~439			6216,~~721~~908,~~553~~763	103.40
Gross profit		4643,~~893~~027,~~552~~885			4342,~~300~~310,~~922~~867			3717,~~592,630~~018	81.37
Gross profit percentage		6.69	%		6.7.0	%

Operating expense	$	4342,~~223~~565,~~231~~980		$	3938,~~477~~967,~~845~~204		$	3,~~745~~598,~~386~~776	9.52
Operating income		3461,~~670,321~~905			3,~~823~~343,~~077~~663			(~~152~~2,~~756~~881,758)	(486.02)
Interest expense		2,~~846~~266,~~621~~407			2,~~311~~247,~~513~~737			~~535~~18,~~108~~670	230.18
Change in fair value of mandatorily redeemable non-controlling interest		~~194~~272,~~812~~856			~~199~~134,~~744~~389			(4138,~~932)~~467	(2103.5)0
Income tax expense		392,000			804,000			(412,000)	(51.2)
Income tax expense (benefit)		(431,000)			613,000			(1,044,000)	(170.3)
Net income available to common shareholders		348,419			1,070,961			(722,542)	(67.5)
Net income (loss) available to common shareholders		(1,589,960)			539,543			(2,129,503)	(394.7)

BUSINESS SEGMENTS:
Wholesale
Sales	$	~~700~~607,~~747~~600,~~921~~563		$	~~634~~590,~~269~~652,~~644~~977		$	6616,~~478~~947,~~277~~586	102.59
Gross profit		4338,~~103~~556,~~716~~563			3938,~~353~~155,~~558~~508			3401,~~750,158~~055	91.51
Gross profit percentage		6.23	%		6.25	%
Retail
Sales	$	1011,~~525~~902,~~335~~524		$	1011,~~689~~224,~~429~~329		$	~~(164~~678,~~094)~~195	(16.5)0
Gross profit		34,~~789~~471,~~836~~322			34,~~947~~155,~~364~~359			~~(157~~315,~~528)~~963	(47.0)6
Gross profit percentage		3637.06	%		3637.90	%

(1) Sales are reported net of costs associated with incentives provided to retailers. These incentives totaled $109.02 million in Q1Q2 2025 and $911.53 million in Q1Q2 2024.

SALES

Changes in sales are primarily driven by:

(i)

changes to selling prices, which are largely controlled by our product suppliers, and excise taxes imposed on cigarettes and tobacco products by various states;

(ii)

changes in the volume and mix of products sold to our customers, either due to a change in purchasing patterns resulting from shifting consumer preferences or the fluctuation in the comparable number of business days in our reporting period; and

(iii) acquisitions.

SALES – Q1Q2 2025 vs. Q1Q2 2024

Sales in our Wholesale Segment increased $6616.59 million during Q1Q2 2025 as compared to Q1Q2 2024. Significant items impacting sales during Q1Q2 2025 included an increase of $565.6 million related to the Arrowrock acquisition in Q2 2025, an increase of $37.7 million related to the combined acquisitions of Burklund and Richmond Master during Q3 2024, and a $2925.23 million increase in sales related to price increases implemented by cigarette manufacturers, ~~and~~partially offset by a $951.73 million ~~increase~~decrease in sales related to the volume and mix of ~~products~~cigarette incartons ~~our~~sold ~~tobacco, confectionery, foodservice,~~ and ~~other categories (“Other Products”), partially offset by~~ a $290.14 million decrease in sales related to the volume and mix of ~~cigarette~~products ~~cartons~~in ~~sold~~our tobacco, confectionery, foodservice, and other categories (“Other Products”). Sales in our Retail Segment ~~decreased~~increased approximately $0.27 million during Q1Q2 2025 as compared to Q1Q2 2024. This ~~decrease~~increase was due to ~~approximately~~ a $0.86 million ~~decrease~~increase related to the ~~closure~~opening of ~~three~~our ~~stores~~new ~~between~~Lakewood ~~the~~Ranch, ~~comparative~~Florida ~~periods,~~store ~~partially~~in ~~offset~~Q3 by2024 and a $0.45 million increase related to ~~the~~higher ~~opening~~sales ofvolumes in our ~~new~~existing ~~Lakewood Ranch~~stores, ~~Florida~~partially ~~store~~offset inby ~~Q3 2024 and~~ a $0.24 million ~~increase~~decrease related to ~~higher~~the ~~sales~~closure ~~volumes~~of inone ~~our~~store ~~existing~~between ~~stores.~~the comparative periods.

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GROSS PROFIT – Q1Q2 2025 vs. Q1Q2 2024

Our gross profit does not include fulfillment costs and costs related to the distribution network, which are included in selling, general and administrative costs, and may not be comparable to those of other entities. Some entities may classify such costs as a component of cost of sales. Cost of sales, a component used in determining gross profit, for the wholesale and retail segments includes the cost of products purchased from manufacturers, less incentives we receive which are netted against such costs.

Gross profit in our Wholesale Segment increased $30.84 million during Q1Q2 2025 as compared to Q1Q2 2024. Significant items impacting gross profit during Q1Q2 2025 included an increase of $30.3 million related to the Arrowrock acquisition in Q2 2025 and an increase of $2.1 million related to the combined acquisitions of Burklund and Richmond Master during Q3 2024, partially offset by a $1.0 million decrease in gross profit related to the volume and mix of cigarette cartons sold between the comparative periods, a $0.58 million ~~increase~~decrease in gross profit related to the mix of volumes and promotions in our Other Products category, and a $0.12 million ~~increase~~decrease in gross profit due to the timing and related benefits of cigarette manufacturer price increases. Gross profit in our Retail Segment ~~decreased~~increased approximately $0.23 million during Q1Q2 2025 as compared to Q1Q2 2024. This change was primarily related to a $0.3 million ~~decrease~~increase in gross profit related to same store sales and a $0.2 million increase related to the ~~closure~~opening of ~~three~~our ~~stores~~new ~~between~~Lakewood ~~the~~Ranch ~~comparative~~store ~~periods~~in Q3 2024, partially offset by a $0.12 million ~~increase~~decrease related to the ~~opening~~closure of ~~our~~one ~~new Lakewood Ranch~~ store inbetween Q3the ~~2024~~comparative periods.

OPERATING EXPENSE – Q1Q2 2025 vs. Q1Q2 2024

Operating expense includes selling, general and administrative expenses and depreciation and amortization. Selling, general, and administrative expenses primarily consist of costs related to our sales, warehouse, delivery and administrative departments, including purchasing and receiving costs, warehousing costs and costs of picking and loading customer orders. Our most significant expenses relate to costs associated with employees, facility and equipment leases, transportation, fuel, and insurance. Our Q1Q2 2025 operating expenses increased $3.76 million as compared to Q1Q2 2024. Significant items impacting operating expenses during Q1Q2 2025 included an increase of $0.4 million related to the Arrowrock acquisition in Q2 2025, an increase of $2.76 million related to the combined acquisitions of Burklund and Richmond Master during Q3 2024, a $10.15 million increase in other Wholesale Segment operating costs, a $1.0.1 million increase in health insurance costs, ~~a $0.2 million increase related to employee compensation~~ and ~~benefit costs, and~~ a $0.23 million increase in operating expense costs in our Retail Segment, partially offset by a $10.53 million decrease related to ~~the~~employee ~~fair~~compensation ~~value~~and ~~adjustment~~benefit ~~of a contingent consideration liability~~costs. The increase in our Retail Segment was primarily due to a $0.3 million increase related to the opening of our new Lakewood Ranch store in Q3 2024, an increase of $0.2 million in our existing stores, partially offset by a $0.32 million decrease related to the closure of ~~three~~one ~~stores~~store between the comparative periods.

INTEREST EXPENSE – Q1Q2 2025 vs. Q1Q2 2024

Interest expense increased less than $0.51 million in Q1Q2 2025 as compared to Q1Q2 2024, primarily ~~related~~due to higher outstanding debt balances in the current period related to the acquisitions of Arrowrock in Q2 2025 and Burklund and Richmond Master in Q3 2024, ~~and~~partially ~~increased~~offset ~~capital~~by ~~expenditures~~lower interest rates in the current period.

~~OTHER~~ INCOME TAX EXPENSE – Q1Q2 2025 vs. Q1Q2 2024

The change in ~~other~~the Q2 2025 income ~~between~~tax ~~the~~rate ~~comparative~~as ~~periods~~compared to Q2 2024 was primarily related to annon-deductible ~~insurance~~compensation ~~recovery~~expense in relation to the ~~prior~~amount ~~year~~of ~~period~~income (loss) from operations before income tax expense (benefit) and variances in the average effective state income tax rates between the comparative periods.

INCOME TAX EXPENSE – Q1 2025 vs. Q1 2024

The change in the Q1 2025 income tax rate as compared to Q1 2024 was primarily related to non-deductible compensation expense in relation to the amount of income from operations before income tax expense and variances in the average effective state income tax rates between the comparative periods.21

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RESULTS OF OPERATIONS – SIX MONTHS ENDED MARCH:


	2025			2024			Incr (Decr)		% Change
CONSOLIDATED:
Sales (1)	$	1,330,776,344		$	1,246,836,380		$	83,939,964	6.7
Cost of sales		1,240,854,907			1,161,224,591			79,630,316	6.9
Gross profit		89,921,437			85,611,789			4,309,648	5.0
Gross profit percentage		6.8	%		6.9	%

Operating expense	$	85,789,212		$	78,445,049		$	7,344,163	9.4
Operating income		4,132,225			7,166,740			(3,034,515)	(42.3)
Interest expense		5,113,028			4,559,250			553,778	12.1
Change in fair value of mandatorily redeemable non-controlling interest		467,668			334,133			133,535	40.0
Income tax expense (benefit)		(39,000)			1,417,000			(1,456,000)	(102.8)
Net income (loss) available to common shareholders		(1,241,541)			1,610,504			(2,852,045)	(177.1)

BUSINESS SEGMENTS:
Wholesale
Sales	$	1,308,348,485		$	1,224,922,622		$	83,425,863	6.8
Gross profit		81,660,278			77,509,067			4,151,211	5.4
Gross profit percentage		6.2	%		6.3	%
Retail
Sales	$	22,427,859		$	21,913,758		$	514,101	2.3
Gross profit		8,261,159			8,102,722			158,437	2.0
Gross profit percentage		36.8	%		37.0	%

(1)

Sales are reported net of costs associated with incentives provided to retailers. These incentives totaled $19.2 million for the six months ended March 2025 and $20.8 million for the six months ended March 2024.

20SALES – Six months ended March 2025

Sales in our Wholesale Segment increased $83.4 million during the six months ended March 2025 as compared to the same prior year period. Significant items impacting sales during the period included an increase of $5.6 million related to the Arrowrock acquisition in Q2 2025, an increase of $94.5 million related to the combined acquisitions of Burklund and Richmond Master during Q3 2024, a $54.5 million increase in sales related to price increases implemented by cigarette manufacturers and a $9.2 million increase in sales related to the volume and mix of products in our Other Products category, partially offset by a $80.4 million decrease in sales related to the volume and mix of cigarette cartons sold. Sales in our Retail Segment increased approximately $0.5 million during the six months ended March 2025 as compared to the same prior year period. This increase was due to a $1.0 million increase related to the opening of our new Lakewood Ranch, Florida store in Q3 2024 and a $0.6 million increase related to higher sales volumes in our existing stores, partially offset by a $1.1 million decrease related to the closure of three stores between the comparative periods.

GROSS PROFIT – Six months ended March 2025

Gross profit in our Wholesale Segment increased $4.2 million during the six months ended March 2025 as compared to the same prior year period. Significant items impacting gross profit during the period included an increase of $0.3 million related to the Arrowrock acquisition in Q2 2025 and an increase of $5.3 million related to the combined acquisitions of Burklund and Richmond Master during Q3 2024, partially offset by a $1.0 million decrease in gross profit related to the volume and mix of cigarette cartons sold between the comparative periods, a $0.3 million decrease in gross profit related to the mix of volumes and promotions in our Other Products category, and a $0.1 million decrease in gross profit due to the timing and related benefits of cigarette manufacturer price increases. Gross profit in our Retail Segment increased approximately $0.2 million during the six months ended March 2025 as compared to the same prior year period. This change was primarily related to a $0.3 million increase in gross profit related to same store sales and a $0.3 million increase

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related to the opening of our new Lakewood Ranch store in Q3 2024, partially offset by a $0.4 million decrease related to the closure of three stores between the comparative periods.

OPERATING EXPENSE – Six months ended March 2025

Operating expenses increased $7.3 million during the six months ended March 2025 as compared to the same prior year period. Significant items impacting operating expenses during the period included an increase of $0.4 million related to the Arrowrock acquisition in Q2 2025, an increase of $5.4 million related to the combined acquisitions of Burklund and Richmond Master during Q3 2024, a $1.5 million increase in other Wholesale Segment operating costs, a $1.0 million increase in health insurance costs, and a $0.5 million increase in operating expense costs in our Retail Segment, partially offset by a $1.5 million decrease related to the fair value adjustment of a contingent consideration liability. The increase in our Retail Segment was primarily due to a $0.6 million increase related to the opening of our new Lakewood Ranch store in Q3 2024 and an increase of $0.4 million in our existing stores, partially offset by a $0.5 million decrease related to the closure of three stores between the comparative periods.

INTEREST EXPENSE – Six months ended March 2025

Interest expense increased $0.6 million during the six months ended March 2025 as compared to the same prior year period, primarily due to higher outstanding debt balances in the current period related to the acquisitions of Arrowrock in Q2 2025 and Burklund and Richmond Master in Q3 2024, partially offset by lower interest rates in the current period.

OTHER INCOME – Six months ended March 2025

The change in other income between the comparative periods was primarily related to an insurance recovery in the prior year period.

INCOME TAX EXPENSE – Six months ended March 2025

The change in the Company’s effective tax rate during the six month period ended March 2025 as compared to the respective prior year period was primarily related to non-deductible compensation expense in relation to the amount of income (loss) from operations before income tax expense (benefit) and variances in the average effective state income tax rates between the comparative periods.

LIQUIDITY AND CAPITAL RESOURCES

Overview

The Company’s variability in cash flows from operating activities is dependent on the timing of inventory purchases and seasonal fluctuations. For example, periodically we have inventory “buy-in” opportunities which offer more favorable pricing terms. As a result, we may have to hold inventory for a period longer than the payment terms. This generates a cash outflow from operating activities that we expect to reverse in later periods. Additionally, during our peak time of operations in the warm weather months, we generally carry higher amounts of inventory to ensure high fill rates and customer satisfaction.

The Company primarily finances its operations through three credit facility agreements (a) a facility that is an obligation of AMCON Distributing Company (the “AMCON Facility”), (b) a facility that is an obligation of Team Sledd, LLC (“Team Sledd” and, the “Team Sledd Facility”) and (c) a facility that is the obligation of Henry’s (the “Henry’s Facility”) (collectively, the “Facilities”) and long-term debt agreements with banks. The Team Sledd Facility and the Henry’s Facility are non-recourse to AMCON Distributing Company, are not guaranteed by AMCON Distributing Company and have no cross default provisions applicable to AMCON Distributing Company. In Q1 2025, the Company amended the Henry’s Facility, increasing its aggregate borrowing capacity from $40.0 million to $45.0 million and extending the maturity date to February 2028. In Q1 2025, the Company amended the Team Sledd Facility to designate the Secured Overnight Financing Rate (“SOFR”) as the primary borrowing rate.

At ~~December~~March ~~2024~~2025, the Facilities had a total combined borrowing capacity of $305.0 million, which includes provisions for up to $30.0 million in credit advances for certain inventory purchases, which are limited by accounts receivable and inventory qualifications, and the value of certain real estate collateral. The AMCON Facility matures in June 2027, the Henry’s Facility matures in February 2028, and the Team Sledd Facility matures in March 2028, each without a penalty for prepayment. Obligations under the Facilities are collateralized by substantially all of the Company’s respective equipment, intangibles, inventories, accounts receivable, and certain real estate. The Facilities each feature an unused commitment fee and springing financial covenants. Borrowings under the Facilities bear interest at SOFR, plus any applicable spreads.

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equipment, intangibles, inventories, accounts receivable, and certain real estate. The Facilities each feature an unused commitment fee and springing financial covenants. Borrowings under the Facilities bear interest at the Secured Overnight Financing Rate (“SOFR”), plus any applicable spreads.

The amount available for use from the Facilities at any given time is subject to a number of factors, including eligible accounts receivable and inventory balances that fluctuate day-to-day, as well as the value of certain real estate collateral. Based on the collateral and loan limits as defined in the Facility agreements, the credit limit of the combined Facilities at ~~December~~March ~~2024~~2025 was $~~247~~220.57 million, of which $~~165~~142.93 million was outstanding, leaving $8178.64 million available.

The average interest rate of the Facilities was 5.9676% at ~~December~~March ~~2024~~2025. For the ~~three~~six months ended ~~December~~March ~~2024~~2025, the peak borrowings under the Facilities was $197.1 million, and the average borrowings and average availability under the Facilities was $~~162~~158.19 million and $73.42 million, respectively.

Cross Default and Co-Terminus Provisions

Team Sledd’s two notes payable and the Team Sledd Facility contain cross default provisions. The Henry’s note payable and the Henry’s Facility contain cross default provisions. There were no such cross defaults for either Team Sledd or Henry’s at ~~December~~March ~~2024~~2025. Additionally, the Team Sledd Facility and the Henry’s Facility are non-recourse to AMCON Distributing Company, are not guaranteed by AMCON Distributing Company and have no cross default provisions applicable to AMCON Distributing Company. The Company and its subsidiaries, including Team Sledd and Henry’s, were in compliance with all of the financial covenants under the respective Facilities at ~~December~~March ~~2024~~2025.

Dividend Payments

The Company paid cash dividends on its common stock totaling $0.13 million inand ~~each~~$0.4 ofmillion for the three- and six-month periods ended ~~December~~March ~~2024 and December 2023. During Q1~~ 2025, ~~the~~respectively, ~~Company~~and ~~declared a~~ $0.283 ~~per~~million ~~share~~and ~~special dividend totaling approximately~~ $0.24 million ~~that~~for ~~will~~the bethree- ~~paid~~and insix-month Q2periods ~~2025.~~ended ~~During~~March Q1 2024, ~~the Company declared a $0~~respectively.~~28 per share special dividend totaling approximately $0.2 million that was paid in Q2 2024.~~

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Other

The Company has issued letters of credit totaling $23.01 million to its workers’ compensation insurance carriers as part of its self-insured loss control program.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Liquidity Risk

The Company’s liquidity position is significantly influenced by its ability to maintain sufficient levels of working capital. For our Company and our industry in general, customer credit risk and ongoing access to bank credit heavily influence liquidity positions.

The Company does not currently hedge its exposure to interest rate risk or fuel costs. Accordingly, significant price movements in these areas can and do impact the Company’s profitability.

While the Company believes its liquidity position going forward will be adequate to sustain operations in both the short- and long-term, a precipitous change in operating environment could materially impact the Company’s future revenue streams as well as its ability to collect on customer accounts receivable or secure bank credit.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in company reports filed or submitted under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s (“SEC”) rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

As required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act, an evaluation of the effectiveness of our disclosure controls and procedures as of ~~December~~March 31, ~~2024~~2025 was made under the supervision and with the participation of our senior management, including our principal executive officer and principal financial officer. Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Limitations on Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures will prevent all errors and fraud. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives. Further, the design of a control system must reflect the fact that there are resource constraints, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management’s override of the control.

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The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the fiscal quarter ended ~~December~~March ~~2024~~2025, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

There have been no material changes to the Company’s risk factors as previously disclosed in Item 1A “Risk Factors” of the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

~~The~~Not Company issued unregistered securities to certain members of the Company’s management team during the quarterly period ended December 31, 2024, in relation to the vesting and granting of equity awards as described in Note 9 of Part I, Item 1 of this quarterly report on Form 10-Qapplicable. ~~These issuances were exempt from registration under Section 4(a)(2) of the Securities Act of 1933.~~

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the three months ended ~~December~~March 31, ~~2024~~2025, none of the Company’s directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement”, as each term is defined in Item 408(a) of Regulation S-K.

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Item 6. Exhibits

(a) Exhibits



	10.1	~~First~~Consent, Joinder and Eleventh Amendment to Second Amended and Restated Loan and Security Agreement, dated ~~October~~January 2417, ~~2024,~~2025 between ~~LOL~~AMCON ~~Foods,~~Distributing ~~Inc.,~~Company ~~HF Real Estate LLC~~ and ~~BMO~~Bank ~~BANK~~of ~~N.A.~~America

	10.2	Fifth Amendment to Credit Agreement, dated December 23, 2024, between Team Sledd, LLC and First National Bank of Pennsylvania

	31.1	Certification by Christopher H. Atayan, Chief Executive Officer and Chairman, pursuant to section 302 of the Sarbanes-Oxley Act

	31.2	Certification by Charles J. Schmaderer, Vice President, Chief Financial Officer and Secretary, pursuant to section 302 of the Sarbanes-Oxley Act

	32.1	Certification by Christopher H. Atayan, Chief Executive Officer and Chairman, furnished pursuant to section 906 of the Sarbanes-Oxley Act

	32.2	Certification by Charles J. Schmaderer, Vice President, Chief Financial Officer and Secretary, furnished pursuant to section 906 of the Sarbanes-Oxley Act

	101	Interactive Data File (filed herewith electronically)

	104	Cover Page Interactive Data File – formatted in Inline XBRL and included as Exhibit 101

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	AMCON DISTRIBUTING COMPANY
	(registrant)

Date: January 21, 2025	/s/ Christopher H. Atayan
Date: April 18, 2025	/s/ Christopher H. Atayan
	Christopher H. Atayan,
	Chief Executive Officer and Chairman

Date: January 21, 2025	/s/ Charles J. Schmaderer
Date: April 18, 2025	/s/ Charles J. Schmaderer
	Charles J. Schmaderer,
	Vice President, Chief Financial Officer and Secretary
	(Principal Financial and Accounting Officer)

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