mcvt_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

__________________________

FORM 10-Q

__________________________

(Mark One)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 30, 2025
or
☐	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 001-41472

__________________________

MILL CITY VENTURES III, LTD.

(Exact name of registrant as specified in its charter)

__________________________

Minnesota		90-0316651
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1907 Wayzata Blvd, #205, Wayzata, Minnesota		55391
(Address of principal executive offices)		(Zip Code)

(952) 479-1923

(Registrant’s telephone number, including area code)

__________________________

N/A

(Former name, former address and former fiscal year, if changed since last report)

__________________________

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, $0.001 par value

MCVT

The Nasdaq Stock Market LLC

(Nasdaq Capital Market)

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 and posted 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 and post 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

As of August 14, 2025, Mill City Ventures III, Ltd. had 82,110,648 shares of common stock, and no other classes of capital stock, outstanding.

MILL CITY VENTURES III, LTD.

Index to Form 10-Q

for the Quarter Ended June 30, 2025

PART I.	FINANCIAL INFORMATION	Page No.

Item 1.	Financial Statements (unaudited)	3

	Condensed Balance Sheets – June 30, 2025 and December 31, 2024	3

	Condensed Statements of Operations – Three and six months ended June 30, 2025 and June 30, 2024	4

	Condensed Statements of Shareholders’ Equity – Three and six months ended June 30, 2025 and June 30, 2024	5

	Condensed Statements of Cash Flows – Six months ended June 30, 2025 and June 30, 2024	6

	Condensed Schedule of Investments – June 30, 2025 and Schedule of Investments – December 31, 2024	7

	Condensed Notes to Financial Statements – June 30, 2025	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 4.	Controls and Procedures	24

PART II.	OTHER INFORMATION

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25

Item 5.	Other Information	25

Item 6.	Exhibits	26

SIGNATURES		27

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MILL CITY VENTURES III, LTD.

CONDENSED BALANCE SHEETS



	June 30, 2025 (unaudited)			December 31, 2024
ASSETS
Investments, at fair value (cost: $17,641,707 and $13,717,089, respectively)	$	17,854,961		$	13,453,561
Cash and cash equivalents		1,497,009			6,026,110
Prepaid expenses		34,598			31,848
Interest and dividend receivables		419,857			191,917
Deferred taxes		641,000			770,000
Total Assets	$	20,447,425		$	20,473,436

LIABILITIES
Accounts payable	$	37,680		$	41,105
Accrued payroll liabilities		8,911			527,142
Accrued income tax		144,500			147,200
Total Liabilities		191,091			715,447
Commitments and Contingencies
SHAREHOLDERS EQUITY (NET ASSETS)
Common stock, par value $0.001 per share (111,111,111 authorized;		6,063			6,385
6,062,773 and 6,385,255 issued and outstanding, respectively)
Additional paid-in capital		14,843,007			15,473,121
Additional paid-in capital - stock options		1,460,209			1,460,209
Accumulated deficit		(1,159,665	)		(1,159,665	)
Accumulated undistributed investment gain (loss)		499,406			(152,389	)
Accumulated undistributed net realized gains on investment transactions		4,394,060			4,393,855
Net unrealized appreciation (depreciation) in value of investments		213,254			(263,527	)
Total Shareholders' Equity (Net Assets)		20,256,334			19,757,989
Total Liabilities and Shareholders' Equity	$	20,447,425		$	20,473,436
Net Asset Value Per Common Share	$	3.34		$	3.09

See accompanying Notes to Financial Statements

Table of Contents

MILL CITY VENTURES III, LTD.

CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)




	Three Months Ended						Six Months Ended
	June 30, 2025			June 30, 2024			June 30, 2025		June 30, 2024
Investment Income
Interest income	$	948,034		$	888,629		$	1,726,061	$	1,721,296
Total Investment Income		948,034			888,629			1,726,061		1,721,296
Operating Expenses
Professional fees		98,764			174,098			241,420		312,469
Payroll		160,230			145,859			323,499		296,925
Insurance		482			24,602			24,253		51,492
Occupancy		16,663			9,545			33,224		20,222
Director's fees		30,000			30,000			60,000		60,000
Interest expense		—			—			—		320
Other general and administrative		10,044			13,955			13,570		17,718
Total Operating Expenses		316,183			398,059			695,966		759,146
Net Investment Gain	$	631,851		$	490,570			1,030,095		962,150
Realized and Unrealized Gain on Investments
Net realized gain (loss) on investments		(31	)		346,745			205		371,240
Net change in unrealized appreciation (depreciation) on investments		314,515			(289,641	)		476,781		(237,890	)
Net Realized and Unrealized Gain on Investments		314,484			57,104			476,986		133,350
Net Increase in Net Assets Resulting from Operations Before Taxes	$	946,335		$	547,674		$	1,507,081	$	1,095,500

Provision for Income Taxes		269,300			134,738			378,300		300,461
Net Increase in Net Assets Resulting from Operations	$	677,035		$	412,936		$	1,128,781	$	795,039

Net Increase in Net Assets Resulting from Operations per share:
Basic	$	0.11		$	0.06		$	0.18	$	0.12
Diluted	$	0.11		$	0.06		$	0.18	$	0.12

Weighted-average number of common shares outstanding - basic		6,062,773			6,385,255			6,190,941		6,385,255
Weighted-average number of common shares outstanding - diluted		6,062,773			6,501,823			6,190,941		6,501,823

See accompanying Notes to Financial Statements

Table of Contents

MILL CITY VENTURES III, LTD.

CONDENSED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED)



Three Months Ended June 30, 2025	Common Shares			Par Value			Additional Paid In Capital			Accumulated Deficit			Accumulated Undistributed Net Investment Gain			Accumulated Undistributed Net Realized Gain (Loss) on Investments Transactions			Net Unrealized Appreciation (Depreciation) in Value of Investments			Total Shareholders' Equity
Balance as of March 31, 2025		6,062,773		$	6,063		$	16,303,216		$	(1,159,665	)	$	136,855		$	4,394,091		$	(101,261	)	$	19,579,299
Undistributed net investment gain					—			—			—			362,551			—			—			362,551
Undistributed net realized loss on investment transactions					—			—			—			—			(31	)		—			(31	)
Appreciation in value of investments					—			—			—			—			—			314,515			314,515
Balance as of June 30, 2025		6,062,773		$	6,063		$	16,303,216		$	(1,159,665	)	$	499,406		$	4,394,060		$	213,254		$	20,256,334

Three Months Ended June 30, 2024	Common Shares			Par Value			Additional Paid In Capital			Accumulated Deficit			Accumulated Undistributed Net Investment Gain (Loss)			Accumulated Undistributed Net Realized Gain on Investments Transactions			Net Unrealized Depreciation in Value of Investments			Total Shareholders' Equity
Balance as of March 31, 2024		6,385,255		$	6,385		$	16,933,330		$	(1,159,665	)	$	(746,326	)	$	5,179,695		$	(1,241,053	)	$	18,972,366
Undistributed net investment gain					—			—			—			355,832			—			—			355,832
Undistributed net realized gain on investment transactions					—			—			—			—			346,745			—			346,745
Depreciation in value of investments					—			—			—			—			—			(289,641	)		(289,641	)
Balance as of June 30, 2024		6,385,255		$	6,385		$	16,933,330		$	(1,159,665	)	$	(390,494	)	$	5,526,440		$	(1,530,694	)	$	19,385,302


Six Months Ended June 30, 2025	Common Shares			Par Value			Additional Paid In Capital			Accumulated Deficit			Accumulated Undistributed Net Investment Gain (Loss)			Accumulated Undistributed Net Realized Gain on Investments Transactions			Net Unrealized Appreciation (Depreciation) in value of Investments			Total Shareholders' Equity

Balance as of December 31, 2024		6,385,255		$	6,385		$	16,933,330		$	(1,159,665	)	$	(152,389	)	$	4,393,855		$	(263,527	)	$	19,757,989
Repurchase of common shares		(322,482	)		(322	)		(630,114	)		—			—			—			—			(630,436	)
Undistributed net investment gain					—			—			—			651,795			—			—			651,795
Undistributed net realized gain on investment transactions					—			—			—			—			205			—			205
Appreciation in value of investments					—			—			—			—			—			476,781			476,781
Balance as of June 30, 2025		6,062,773		$	6,063		$	16,303,216		$	(1,159,665	)	$	499,406		$	4,394,060		$	213,254		$	20,256,334

Six Months Ended June 30, 2024	Common Shares			Par Value			Additional Paid In Capital			Accumulated Deficit			Accumulated Undistributed Net Investment Gain (Loss)			Accumulated Undistributed Net Realized Gain on Investments Transactions			Net Unrealized Depreciation in value of Investments			Total Shareholders' Equity

Balance as of December 31, 2023		6,385,255		$	6,385		$	16,933,330		$	(1,159,665	)	$	(1,052,183	)	$	5,155,200		$	(1,292,804	)	$	18,590,263
Undistributed net investment gain					—			—			—			661,689			—			—			661,689
Undistributed net realized gain on investment transactions					—			—			—			—			371,240			—			371,240
Depreciation in value of investments					—			—			—			—			—			(237,890	)		(237,890	)
Balance as of June 30, 2024		6,385,255		$	6,385		$	16,933,330		$	(1,159,665	)	$	(390,494	)	$	5,526,440		$	(1,530,694	)	$	19,385,302

See accompanying Notes to Financial Statements

Table of Contents

MILL CITY VENTURES III, LTD.

CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)



	Six Months Ended
	June 30, 2025			June 30, 2024
Cash flows from operating activities:
Net increase in net assets resulting from operations	$	1,128,781		$	795,039
Adjustments to reconcile net increase in net assets resulting
from operations to net cash provided (used) in operating activities:
Net change in unrealized appreciation (depreciation) on investments		(476,781	)		237,890
Net realized gain on investments		(205	)		(371,240	)
Purchases of investments		(4,428,530	)		(973,438	)
Proceeds from sales of investments		504,116			5,461,479
Deferred income taxes		129,000			(15,000	)
Changes in operating assets and liabilities:
Prepaid expenses and other assets		(2,750	)		70,822
Interest and dividends receivable		(227,940	)		86,621
Accounts payable and other liabilities		(524,356	)		(243,586	)
Net cash provided by (used in) operating activities		(3,898,665	)		5,048,587
Cash flows from financing activities:
Payments for repurchase of common stock		(630,436	)		—
Net cash used by financing activities		(630,436	)		—
Net increase (decrease) in cash		(4,529,101	)		5,048,587
Cash, beginning of period		6,026,110			376,024
Cash, end of period	$	1,497,009		$	5,424,611

See accompanying Notes to Financial Statements

Table of Contents

MILL CITY VENTURES III, LTD.

CONDENSED SCHEDULE OF INVESTMENTS (UNAUDITED)

JUNE 30, 2025



Investment / Industry	Cost		Fair Value		Percentage of Net Assets

Short-Term Non-banking Loans
Consumer - 18% secured loans	$	500,000	$	500,000		2.47	%
Consumer - 24% secured loans		900,100		900,515		4.45	%
Real Estate - 15% secured loans
Alatus Development Corp		2,500,000		2,538,018		12.53	%
Real Estate - 24% secured loans
Coventry Holdings LLC		2,750,000		2,746,762		13.56	%
Total Short-Term Non-Banking Loans		6,650,100		6,685,295		33.01	%

Commercial Business Loans

SEC Form 10-Q filed by Mill City Ventures III Ltd.