CALLAN JMB INC.

Callan JMB Inc. (CJMB) operates as a vertically integrated logistics and fulfillment company, specializing in thermal management logistics solutions for the life sciences industry. The company's core business revolves around providing proprietary packaging, information technology, and specialized cold chain logistics expertise to ensure the safety, effectiveness, and potency of temperature-sensitive products. CJMB views its solutions as disruptive to older technologies like dry ice and liquid nitrogen, offering comprehensive, reliable, and economic alternatives for frozen shipping in the life sciences sector, including personalized medicine, cell therapies, vaccines, and bio-pharmaceuticals. A key aspect of their service is the ability to monitor, record, and archive crucial shipment information for scientific and regulatory purposes. The company's revenue generation is primarily through providing emergency preparedness services and specialty packaging, with most services recognized over time as time and materials are incurred, and product revenues recognized at the point of delivery.

CJMB maintains a significant market position in emergency response, despite facing competition from local, regional, and national firms. However, the company states that no single competitor directly competes with its full suite of offerings due to the breadth of its services. Its competitive strengths include extensive experience in thermal management quality assurance and control, a long history and reputation for swift emergency response support for Fortune 500 firms, the City of Chicago, NATO, the UN, and government agencies, and the use of specialty temperature-regulating reusable packaging that reduces waste and cost. The company also emphasizes its end-market value propositions and flexibility, experience in highly regulated industries, and a highly trained and experienced team.

The company's core business model is centered on providing thermal management logistics solutions. Revenue is generated through two primary distribution channels: Emergency Preparedness and Specialty Packaging. Emergency Preparedness services, which include managing building sites, medical stockpiles, and responding to emergencies for state and local governments, generated $3,980,109 ¹ in revenue for the year ended December 31, 2025. Specialty Packaging, which offers temperature-regulating packaging solutions and integrates Callan JMB's technology for scalable ordering, inventory, fulfillment, tracking, and recovery, contributed $1,743,069 ² in revenue for the same period. Fulfillment services, which include technical services through a service center for emergency response and perishable packaging, are bundled and not disaggregated as separate revenue streams. The Advanced Monitoring Sentry Technology is a key offering that tracks temperature, humidity, and location for temperature-sensitive goods.

For the year ended December 31, 2025, total revenue was $5,723,178 ³, a decrease of $840,234 ⁴ or 13% ⁵ from $6,563,412 ⁶ in 2024. Cost of revenue decreased by $381,512 ⁷ to $3,618,637 ⁸ in 2025 from $4,000,149 ⁹ in 2024, primarily due to the decrease in revenue. Gross profit for 2025 was $2,104,541 ¹⁰, down $458,722 ¹¹ or 17% ¹² from $2,563,263 ¹³ in 2024. Selling, general and administrative expenses increased significantly by $3,758,955 ¹⁴ to $8,597,032 ¹⁵ in 2025 from $4,838,077 ¹⁶ in 2024, a 77% ¹⁷ increase. The company also recorded an impairment loss on property and equipment of $542,088 ¹⁸ in 2025, with no such loss in 2024. This resulted in a loss from operations of $(7,034,579) ¹⁹ in 2025, compared to $(2,274,814) ²⁰ in 2024. Net loss for 2025 was $(7,966,366) ²¹, a substantial increase from $(2,293,648) ²² in 2024. Diluted EPS for 2025 was $(1.82) ²³, compared to $(0.87) ²⁴ in 2024. Cash and cash equivalents at December 31, 2025, were $2,130,758 ²⁵, a slight increase from $2,097,945 ²⁶ at December 31, 2024. The company reported an accumulated deficit of $(10,260,014) ²⁷ as of December 31, 2025. Total liabilities were $3,447,662 ²⁸ in 2025, up from $1,909,191 ²⁹ in 2024.

Year-over-year, revenue decreased by 13% ⁵, driven by a decrease in demand for emergency preparedness services from certain states and local governments. Gross profit declined by 17% ¹². Selling, general and administrative expenses increased significantly by $3,758,955 ¹⁴, primarily due to a rise in consulting and professional fees by $821,739 ³⁰ for capital raising and public entity support, an increase in information technology support by $135,927 ³¹ for equipment and hosting software, and a rise in marketing and advertising by $206,901 ³² for specialized marketing and investor relations. The company also recognized a $542,088 ¹⁸ impairment loss on property and equipment in 2025. Net loss widened by $5,672,718 ³³ to $(7,966,366) ²¹ in 2025. Cash used in operating activities increased by $5,087,077 ³⁴ to $(4,546,724) ³⁵ in 2025, mainly due to the increased net loss and a decrease in accounts receivable, partially offset by non-cash adjustments for stock-based compensation and derivative liability.

During the reported period, Callan JMB Inc. completed its initial public offering (IPO) in February 2025, issuing 1,280,000 ³⁶ shares of common stock at $4.00 ³⁷ per share, generating gross proceeds of $5,120,000 ³⁸. The underwriters also partially exercised their over-allotment option, purchasing approximately 164,000 ³⁹ shares at $4.00 ³⁷, for additional gross proceeds of approximately $656,000 ⁴⁰. Total gross proceeds from the offering were approximately $5,776,000 ⁴¹, with net proceeds of approximately $4,500,000 ⁴² after deducting underwriting discounts and commissions of approximately $1,000,000 ⁴³. The company also issued 72,179 ⁴⁴ stock warrants to underwriters at an exercise price of $4.80 ⁴⁵ per share. In July 2025, CJMB entered into an Equity Line of Credit (ELOC) Purchase Agreement with an investor, granting the right to sell up to $25.0 million ⁴⁶ of common stock. As of December 31, 2025, approximately 340,094 ⁴⁷ shares were issued under the ELOC Facility for net proceeds of approximately $497,750 ⁴⁸. The company also recognized an initial fair value of the purchased put option of $974,309 ⁴⁹ related to the ELOC Facility, and other transaction expenses of $569,552 ⁵⁰.

Callan JMB Inc. aims to leverage its core competitive strengths to develop and maintain ongoing relationships with a diversified customer base while expanding its service lines to meet evolving customer needs. The company strives to be recognized as the premier provider of logistics and fulfillment services, emphasizing breadth of services, quality, responsiveness, customer service, information technologies, safety, and cost-effectiveness. Management views its comprehensive thermal management logistics solutions as disruptive, offering reliable and economic alternatives to existing frozen shipping methods in the life sciences industry.

A key growth area for the company is cross-selling its solutions. With a broad range of service offerings and a significant North American footprint, CJMB seeks to provide various services and products to meet customer objectives, particularly in emergency response situations. The company aims to be a "one-stop-shop" service provider, expanding the range of services traditionally provided to customers and identifying opportunities to cross-sell across its divisions to drive additional revenue.

Another significant growth opportunity lies in expanding into additional market opportunities. The company plans to leverage its system, particularly its Sentry monitoring technology, to ensure the integrity of packages in industries such as pharmaceuticals. Future expansion targets include support for glucagon-like peptide receptor-1 agonist (GLP-1) transport, compounding pharmacies, and high-end food packaging. Management believes its system can minimize spoilage, contamination, and other issues, thereby safeguarding drug effectiveness and food safety. The Sentry monitoring system is intended to track temperature, humidity, and location to ensure packages remain within specified parameters throughout transit.

Operationally, CJMB is focused on executing cost, pricing, and productivity initiatives. The company continually seeks to increase efficiency and reduce costs through enhanced technology, process improvements, and strategic expense management. This includes identifying areas for strategic investments in automation, process improvements, and employees to boost productivity, efficiency, and safety compliance. There is a continuous focus on the operating leverage of support functions, including global expansion, to achieve profitability and productivity benefits. The company aims to price its services and products competitively, considering customer demands, the value of its asset network, and its ability to respond to market changes, while also emphasizing sustainability, environmental compliance, and safety.

The company plans to foster innovation through technology. Remote temperature monitoring technology is central to its operations, influencing strategy from increasing throughput to automation, including artificial intelligence and predictive technology. CJMB intends to utilize advanced technologies internally and integrate technology-based solutions for customers, promoting safety, efficiency, and profitability. Proprietary inventory management software, Ship2Q®, and Sentry monitoring enable central management of the transportation network, allowing for deployment, monitoring, and adjustment of operations as needs change. Investments in technology are expected to enhance service value, leading to growth, retention, profitability, and improved customer experience.

Regarding capital allocation, as of March 31, 2026, the company has raised $1.55 million ⁵¹ from its Equity Line of Credit (ELOC) Facility, with $23.45 million ⁵² remaining availability. Management intends to continue evaluating and utilizing available funding, including operating cash flows and potential other sources of funding such as equity or debt financing, as well as additional funding from Mr. Wayne Williams, the CEO and largest shareholder. The company's principal liquidity requirements are for working capital to fund operations and growth.

Management explicitly flagged several structural headwinds and execution risks to its growth plan. The company has historically incurred significant losses, with a net loss of $(7,966,366) ²¹ for 2025 and an accumulated deficit of $(10,260,014) ²⁷ as of December 31, 2025, raising substantial doubt about its ability to continue as a going concern. The business is capital intensive, requiring ongoing cash outlays that may strain available capital and necessitate selling assets, incurring debt, or selling equity on unfavorable terms. Decreased availability or increased costs of key logistics and supply chain inputs, including third-party supplies of equipment and materials, could impact profitability. The rent-to-rent model requires substantial upfront capital outlay for warehouse sourcing and renovation, with risks of delays and inability to collect service fees in a timely manner. The company depends on the availability of certain component products from third-party manufacturers, some of which are sole-sourced, and delays or increased costs in procurement could adversely affect operations and customer satisfaction. Furthermore, delays or difficulties in establishing sales, marketing, and distribution capabilities in the Americas, EMEA, and APAC could hinder revenue growth.

Geographic, regulatory, or macro factors identified as constraints include the highly regulated nature of the industries served, subjecting the company to extensive regulations from bodies like the FDA and USDA. Failure to comply with these regulations could lead to fines, product recalls, and operational restrictions. Shipments using CJMB's solutions are subject to various international and domestic regulations (e.g., CDC, OSHA, DOT, IATA, ICAO), and compliance can be costly and complex. Changes in trade policy, tariffs, and import/export regulations could also materially affect the business. The company is also subject to concentration risk, with its top three customers accounting for approximately 79% ⁵³ of total revenue in 2025, and the loss of any major customer could materially adversely affect the business.

Callan JMB Inc. faces material risks including its history of significant losses, with a net loss of $(7,966,366) ²¹ in 2025 and an accumulated deficit of $(10,260,014) ²⁷ as of December 31, 2025, which raises substantial doubt about its ability to continue as a going concern. The business is capital intensive, requiring ongoing cash outlays that may strain available capital and potentially force the company to sell assets, incur debt, or sell equity on unfavorable terms. There is a significant customer concentration risk, as three customers accounted for approximately 79% ⁵³ of total revenues in 2025, and the temporary suspension of orders by one significant customer and the cessation of business with another contributed to a revenue decrease of approximately $835,878 ⁵⁴ in 2025. Operational risks include decreased availability or increased costs of key logistics and supply chain inputs, reliance on third-party component manufacturers, and potential delays or interruptions in shipping services due to external factors. The company's rent-to-rent model involves upfront capital outlays for warehouse renovation and the risk of not collecting service fees in a timely manner. Regulatory risks are substantial, as the company operates in highly regulated industries and is subject to extensive federal, state, and local regulations, including those from the FDA and USDA, with non-compliance potentially leading to fines, product recalls, and operational limitations. Cybersecurity threats pose a risk to critical information systems, including the Sentry platform, potentially leading to reputational damage, revenue loss, and increased security spending. Product and service errors or defects, especially in human reproductive medicine applications, could result in significant liability, litigation, and product recalls, potentially exceeding current insurance coverage. Changes in government regulation, trade policies, tariffs, and tax laws could also adversely affect the business, increasing costs or reducing demand.

Management's message to shareholders emphasizes a strategic focus on leveraging core competitive strengths to foster growth and maintain customer relationships. They aim to be recognized as a premier provider of logistics and fulfillment services, highlighting the breadth, quality, responsiveness, and cost-effectiveness of their solutions. A key strategic priority is to cross-sell their diverse service offerings and expand into new market opportunities, specifically mentioning GLP-1 drug transport, compounding pharmacies, and high-end food packaging, where their Sentry monitoring system can ensure product integrity. Management is also committed to increasing efficiency and reducing costs through enhanced technology, process improvements, and strategic expense management, with a continuous focus on operating leverage and global expansion to achieve profitability. Fostering innovation through technology, including AI and predictive technology, is another strategic pillar, aiming to enhance productivity and deliver value to customers. Despite incurring a net loss of $(7,966,366) ²¹ in 2025 and an accumulated deficit of $(10,260,014) ²⁷, management believes that current liquidity sources, including the Equity Line of Credit with $23.45 million ⁵² remaining availability as of March 31, 2026, combined with strategic initiatives and cost reduction, will alleviate substantial doubts about the company's ability to continue as a going concern.