TIMKEN CO

Previous wording

•Timken’s Engineered Bearings segment features a broad range of product designs serving original equipment manufacturers (OEMs) and end-users worldwide. Timken is a leading authority on tapered roller bearings and leverages its position by applying engineering know-how and technology across its entire bearing portfolio, which includes tapered, spherical and cylindrical roller bearings; plain bearings, metal-polymer bearings and rod end bearings; thrust and specialty ball bearings; and housed or mounted bearings. The Engineered Bearings portfolio features the Timken®, GGB® and Fafnir® brands and serves customers across global industries, including wind energy, agriculture, construction, food and beverage, metals and mining, automotive and truck, aerospace, rail and more.

Current wording

•Timken’s Engineered Bearings segment features a broad range of product designs serving OEMs and end-users worldwide. Timken is a leading authority on tapered roller bearings and leverages its position by applying engineering know-how and technology across its entire bearing portfolio, which includes tapered, spherical and cylindrical roller bearings; plain bearings, metal-polymer bearings and rod end bearings; thrust and specialty ball bearings; and housed or mounted bearings. The Engineered Bearings portfolio features the Timken®, GGB® and Fafnir® brands and serves customers across global industries, including wind energy, agriculture, construction, food and beverage, metals and mining, automotive and truck, aerospace, rail and more.

Previous wording

•Timken’s Industrial Motion segment includes a diverse and growing portfolio of engineered products, including industrial drives, automatic lubrication systems, linear motion products and systems, chains, belts, couplings, filtration systems, seals, and industrial clutches and brakes that keep systems running efficiently. Industrial Motion also includes industrial drivetrain services, which return equipment to like-new condition. The Industrial Motion portfolio features many strong brands, including Philadelphia Gear®, Cone Drive®, Spinea®, Rollon®, Nadella®, Groeneveld®, BEKA®, Des-Case®, Diamond®, Drives®, Timken® Belts, Lovejoy®, PT Tech®, Lagersmit® and CGI. Industrial Motion products are used across a broad range of industries, including solar energy, automation, construction, agriculture and turf, passenger rail, marine, aerospace, packaging and logistics, medical and more.

Current wording

•Timken’s Industrial Motion segment includes a diverse and growing portfolio of engineered products, including industrial drives, precision drives, automatic lubrication systems, linear motion products and systems, chains, belts, couplings, filtration systems, seals, and industrial clutches and brakes that keep systems running efficiently. Industrial Motion also includes industrial services, which return equipment and components to like-new condition. The Industrial Motion portfolio features many strong brands, including Philadelphia Gear®, Cone Drive®, Spinea®, Rollon®, Nadella®, Groeneveld®, BEKA®, Des-Case®, Diamond®, Drives®, Timken® Belts, Lovejoy®, PT Tech®, Lagersmit® and CGI. Industrial Motion products are used across a broad range of industries, including automation, solar energy, construction, agriculture and turf, passenger rail, marine, aerospace, packaging and logistics, medical and more.

Previous wording

Profitable Growth. The Company intends to expand into new and existing markets by leveraging its collective knowledge of materials science, friction management and power transmission to create value for Timken customers. Using a highly collaborative technical selling approach, the Company places particular emphasis on creating unique solutions for challenging and/or demanding applications. The Company intends to grow in attractive market sectors around the world, emphasizing those spaces that are highly fragmented, demand high service and value the reliability and efficiency offered by Timken products. The Company also targets applications that offer significant aftermarket demand, thereby providing product and services revenue throughout the equipment’s lifetime.

Current wording

Profitable Growth. The Company intends to expand into new and existing markets by leveraging its collective knowledge of materials science, friction management and power transmission to create value for Timken customers. Using a customer-centric and highly collaborative technical selling approach, the Company places particular emphasis on creating unique solutions for challenging and/or demanding applications. The Company intends to grow in attractive market sectors around the world, emphasizing those spaces that are highly fragmented, demand high service and value the reliability and efficiency offered by Timken products. The Company also targets applications that offer significant aftermarket demand, thereby providing product and services revenue throughout the equipment’s lifetime.

Previous wording

Net sales decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024. The decrease was primarily driven by lower end-market demand in both segments, as well as the unfavorable impact of foreign currency exchange rate changes, partially offset by the benefit of acquisitions.

Current wording

Net sales decreased for the three months ended June 30, 2025 compared with the three months ended June 30, 2024. The decrease was primarily driven by lower end-market demand in both segments, partially offset by favorable pricing, the benefit of acquisitions and the favorable impact of foreign currency exchange rate changes. Net sales decreased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024. The decrease was primarily driven by lower end-market demand in both segments as well as the unfavorable impact of foreign currency exchange rate changes, partially offset by favorable pricing and the benefit of acquisitions.

Previous wording

Net income decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 primarily due to the impact of lower volume, higher manufacturing costs, higher impairment and restructuring charges, unfavorable price/mix and the unfavorable impact of foreign currency exchange rate changes, partially offset by lower tax expense and the benefit of acquisitions.

Current wording

Net income decreased for the three months ended June 30, 2025 compared with the three months ended June 30, 2024 primarily due to lower volume and incremental tariff costs, partially offset by favorable pricing. Net income decreased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 primarily due to lower volume, higher manufacturing costs, incremental tariff costs and higher restructuring costs, partially offset by lower income tax expense, favorable pricing and the benefit of acquisitions.

Previous wording

In early 2025, the United States government announced the imposition of import tariffs on all countries. The baseline reciprocal tariff is 10%, with higher tariffs imposed on certain countries like China, Mexico and Canada, and sectors like steel, aluminum and automotive. The Company is taking steps to mitigate the increased costs from incremental tariffs through pricing, surcharges and other actions. Timken is also monitoring the impact that tariffs could have on global economic demand. The Company currently expects that tariffs and the related macroeconomic effects will adversely impact operating income in 2025.

Current wording

During the first half of 2025, the United States government announced the imposition of import tariffs on all countries. The baseline reciprocal tariff is 10%, with higher tariffs imposed on certain countries like China, Mexico and Canada, and sectors like steel, aluminum and automotive. The Company is taking steps to mitigate the increased costs from incremental tariffs through pricing, surcharges and other actions. Timken is also monitoring the impact that tariffs could have on global economic demand. The Company currently anticipates that tariffs and the related macroeconomic effects will adversely impact operating income in 2025.

Previous wording

As a result, the Company expects 2025 full-year revenues to be down in total compared to 2024, primarily driven by lower demand related to international trade volatility and the impact of unfavorable foreign currency exchange rates, partially offset by favorable pricing and the benefit of acquisitions completed during 2024. The Company's earnings are expected to be down in 2025 compared with 2024, primarily due to the impact of lower organic sales volume, higher tariffs and unfavorable foreign currency exchange rate changes, offset partially by lower operating costs and the favorable impact of acquisitions.

Current wording

As a result, the Company expects 2025 full-year revenues to be down 2.0% to 0.5% compared to 2024, primarily driven by lower demand across both segments, partially offset by favorable pricing and the benefit of acquisitions completed during 2024. The Company's earnings are expected to be down in 2025 compared with 2024, primarily due to the impact of lower organic sales volume, unfavorable mix, and incremental tariff costs, offset partially by favorable pricing, lower operating costs and the favorable impact of acquisitions.

Previous wording

The Company expects to generate a higher amount of cash from operating activities in 2025 compared to 2024, driven by improved working capital performance, a lower level of capital expenditures, and lower cash taxes. The Company expects capital expenditures in 2025 to be in the range of 3.5% of sales.

Current wording

The Company expects to generate a higher amount of cash from operating activities in 2025 compared to 2024, driven by improved working capital performance and lower cash taxes, partially offset by higher pension and other postretirement benefit contributions and payments. The Company expects capital expenditures in 2025 to be in the range of 3.5% of sales.

Previous wording

Net sales decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024. The decrease was driven by lower organic revenue of $37 million and the unfavorable impact of foreign currency exchange rate changes of $25 million, partially offset by the favorable impact of acquisitions of $12 million.

Current wording

Net sales decreased for the three months ended June 30, 2025 compared with the three months ended June 30, 2024. The decrease was driven by lower organic revenue of $30 million, partially offset by the favorable impact of acquisitions of $14 million and the favorable impact of foreign currency exchange rate changes of $7 million. Net sales decreased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024. The decrease was driven by lower organic revenue of $67 million and the unfavorable impact of foreign currency exchange rate changes of $19 million, partially offset by the favorable impact of acquisitions of $26 million.

Previous wording

Operating income decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024, primarily due to the impact of lower volume, higher manufacturing costs, higher impairment and restructuring charges, unfavorable price/mix and the unfavorable impact of foreign currency exchange rate changes, partially offset by the benefit of acquisitions.

Current wording

Operating income decreased for the three months ended June 30, 2025 compared with the three months ended June 30, 2024, due to incremental cost of tariffs, the impact of lower volume and unfavorable mix, partially offset by favorable pricing, lower material and logistics costs and the benefit of acquisitions. Operating income decreased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024, due to the impact of lower volume, unfavorable mix, higher manufacturing costs, incremental tariff costs, higher impairment and restructuring charges and the unfavorable impact of foreign currency exchange rate changes, partially offset by favorable pricing and the benefit of acquisitions.

Previous wording

•Selling, general and administrative ("SG&A") expenses decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024, primarily due to the favorable impact of foreign currency exchange rates and reduced discretionary spending to align with the lower demand levels.

Current wording

•Selling, general and administrative ("SG&A") expenses increased for the three months ended June 30, 2025 compared with the three months ended June 30, 2024, primarily due to increased accruals for potential uncollectible accounts, the unfavorable impact from currency and the impact of acquisitions, partially offset by reduced discretionary spending to align with the lower demand levels. SG&A expenses were flat for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 as the impact of acquisitions and increased accruals for potential uncollectible accounts were offset by reduced discretionary spending to align with lower demand levels.

Previous wording

•Impairment and restructuring charges were higher for the three months ended March 31, 2025 compared with the three months ended March 31, 2024, primarily due to severance related to the CEO transition during the three months ended March 31, 2025.

Current wording

•Impairment and restructuring charges were higher for the six months ended June 30, 2025 compared with the six months ended June 30, 2024, primarily due to severance related to the CEO transition during the six months ended June 30, 2025.

Previous wording

The decrease in interest expense for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 was primarily due to lower average debt levels.

Current wording

The decrease in interest expense for the three and six months ended June 30, 2025 compared with the three and six months ended June 30, 2024 was primarily due to lower average debt levels and lower interest rates.

Previous wording

Income tax expense decreased $15.8 million for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 due to lower pre-tax earnings and the net favorable impact of discrete items in comparison to the year ago period. The favorable discrete items in the current period primarily related to the reversal of accruals for uncertain tax positions to account for the expiration of statutes of limitation in jurisdictions outside the United States.

Current wording

Income tax expense decreased $21.0 million for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 primarily due to lower pre-tax earnings and the net favorable impact of discrete items in comparison to the year ago period. The favorable discrete items in the six months ended June 30, 2025 primarily related to the reversal of accruals for uncertain tax positions to account for the expiration of statutes of limitation in jurisdictions outside the United States.

Previous wording

Adjusted EBITDA decreased $15.0 million or 18.3% for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 primarily due to the impact of lower volume and higher manufacturing costs, partially offset by the benefit of acquisitions and lower SG&A expenses.

Current wording

•Cost of products sold increased for the three months ended June 30, 2025 compared with the three months ended June 30, 2024 due to incremental tariff costs of $11 million, unfavorable foreign currency exchange rate changes and higher manufacturing costs, partially offset by lower material and logistics costs of $5 million and the impact of lower production volume.

Previous wording

The Engineered Bearings segment's net sales, excluding the effects of foreign currency exchange rate changes, decreased $22.4 million or 2.8% in the three months ended March 31, 2025 compared with the three months ended March 31, 2024. The decrease was primarily driven by lower demand across most market sectors, with auto/truck and heavy industries sectors posting the largest declines, partially offset by higher renewable energy demand.

Current wording

The Engineered Bearings segment's net sales, excluding the effects of foreign currency exchange rate changes, decreased $28.6 million or 1.8% in the six months ended June 30, 2025 compared with the six months ended June 30, 2024. The decrease was primarily driven by lower demand across most market sectors, with the auto/truck, heavy industries and off-highway sectors posting the largest declines, partially offset by higher renewable energy demand. Adjusted EBITDA for the Engineered Bearings segment decreased for the six months ended June 30, 2025 by $35.0 million or 10.1% compared with the six months ended June 30, 2024, due to the impact of lower volume, the unfavorable impact of tariffs and unfavorable foreign currency exchange rate changes, partially offset by lower SG&A expenses and lower material and logistics costs (net).

Previous wording

•Cost of products sold decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024, due to the impact of foreign currency exchange rate changes of $18 million and the impact of lower volume of $12 million, partially offset by higher manufacturing costs of $12 million and the incremental cost of goods sold from acquisitions of $4 million.

Current wording

•Cost of products sold decreased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 due to favorable foreign currency exchange rate changes of $12 million, the impact of lower production volume of $7 million and lower material and logistics costs (net) of $4 million, partially offset by incremental tariff costs of $12 million.

Previous wording

•SG&A expenses decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 driven primarily by the favorable impact of foreign currency exchange rate changes and reduced discretionary spending.

Current wording

•SG&A expenses decreased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 driven primarily by lower compensation expense.

Previous wording

The Industrial Motion segment's net sales, excluding the effects of acquisitions and foreign currency exchange rate changes, decreased $14.8 million or 3.8% in the three months ended March 31, 2025 compared with the three months ended March 31, 2024. The decrease reflects lower demand across most platforms, with industrial services and lubrication systems experiencing the largest declines, partially offset by growth in the drive systems platform.

Current wording

The Industrial Motion segment's net sales, excluding the effects of acquisitions and foreign currency exchange rate changes, decreased $23.3 million or 5.8% in the three months ended June 30, 2025 compared with the three months ended June 30, 2024. The decrease reflects lower demand across most platforms, with belts and chain and lubrication systems experiencing the largest declines. Adjusted EBITDA decreased $7.1 million or 8.9% for the three months ended June 30, 2025 compared with the three months ended June 30, 2024 primarily due to the impact of lower volume, partially offset by favorable pricing and the benefit of acquisitions.

Previous wording

•Cost of products sold increased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 due to the impact of higher manufacturing costs of $10 million and the incremental cost of goods sold from acquisitions of $8 million, partially offset by the impact of lower volume of $5 million.

Current wording

•Cost of products sold increased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 due to the incremental cost of goods sold from acquisitions of $17 million, higher manufacturing costs of $5 million and incremental tariff costs, partially offset by the impact of lower production volume of $17 million.

Previous wording

•SG&A expenses decreased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 due to reduced discretionary spending, partially offset by the incremental SG&A expense from acquisitions.

Current wording

•SG&A expenses increased for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 primarily due to increased accruals for potential uncollectible accounts, as well as the incremental SG&A expense from acquisitions, partly offset by reduced discretionary spending.

Previous wording

Unallocated corporate expense increased for the three months ended March 31, 2025 compared with the three months ended March 31, 2024 primarily due to an increase in compensation expense.

Current wording

Unallocated corporate expense increased for the three and six months ended June 30, 2025 compared with the three and six months ended June 30, 2024 primarily due to unfavorable foreign currency exchange rate changes.

Previous wording

The increase in net cash provided by operating activities for the first three months of 2025 compared with the first three months of 2024 was due to the favorable impact of working capital items of $48.7 million, partially offset by a decrease in net income of $19.2 million and lower accrued income taxes of $16 million. Refer to the tables below for additional detail of the impact of each line item on net cash provided by operating activities.

Current wording

The decrease in net cash provided by operating activities for the first six months of 2025 compared with the first six months of 2024 was due to the unfavorable impact of income taxes on cash of $48.5 million, a decrease in net income of $35.5 million and higher pension and postretirement payments of $12.3 million, largely offset by the favorable impact of working capital items of $74.3 million and other items. Refer to the tables below for additional detail of the impact of each line item on net cash provided by operating activities.

Previous wording

The following table displays the impact of working capital items on cash during the first three months of 2025 and 2024:

Current wording

The following table displays the impact of working capital items on cash during the first six months of 2025 and 2024:

Previous wording

The following table displays the impact of income taxes on cash during the first three months of 2025 and 2024:

Current wording

The following table displays the impact of income taxes on cash during the firstsix months of 2025 and 2024:

Previous wording

The increase in net cash used in investing activities for the first three months of 2025 compared with the first three months of 2024 was due to a decrease in cash from the net liquidation of short-term marketable securities of $18.9 million, partially offset by lower capital expenditures of $8.9 million.

Current wording

The increase in net cash used in investing activities for the first six months of 2025 compared with the first six months of 2024 was due to a decrease in cash from the net liquidation of short-term marketable securities of $16.1 million, partially offset by lower capital expenditures of $13.1 million.

Previous wording

The change in net cash used in financing activities for the first three months of 2025 compared with the first three months of 2024 was due to an increase in the purchase of treasury shares of $23.1 million, partially offset by a decrease in net borrowings of $10.4 million.

Current wording

The change in net cash used in financing activities for the first six months of 2025 compared with the first six months of 2024 was due to the proceeds from the sale of shares of TIL of $232.3 million in 2024, as well as an increase in the purchase of treasury shares of $16.0 million, partially offset by a favorable change in debt borrowings/payments of $214.5 million.

Previous wording

At March 31, 2025, the Company had strong liquidity with $376.1 million of cash and cash equivalents on the Consolidated Balance Sheet, as well as $820.0 million available under committed credit lines. Of the $376.1 million of cash and cash equivalents, $355.1 million resided in jurisdictions outside the United States. Repatriation of non-U.S. cash could be subject to taxes and some portion may be subject to governmental restrictions. Part of the Company's strategy is to grow in attractive market sectors, many of which are outside the United States. This strategy includes making investments in facilities, equipment and potential new acquisitions. The Company plans to fund these investments, as well as meet working capital requirements, with cash and cash equivalents and unused lines of credit within the geographic location of these investments where feasible.

Current wording

At June 30, 2025, the Company had strong liquidity with $419.3 million of cash and cash equivalents on the Consolidated Balance Sheet, as well as $850.0 million available under committed credit lines. Of the $419.3 million of cash and cash equivalents, $395.5 million resided in jurisdictions outside the United States. Repatriation of non-U.S. cash could be subject to taxes and some portion may be subject to governmental restrictions. Part of the Company's strategy is to grow in attractive market sectors, many of which are outside the United States. This strategy includes making investments in facilities, equipment and potential new acquisitions. The Company plans to fund these investments, as well as meet working capital requirements, with cash and cash equivalents and unused lines of credit within the geographic location of these investments where feasible.

Previous wording

On December 5, 2022, the Company entered into the Credit Agreement, which is comprised of a $750.0 million Senior Credit Facility and a $400.0 million 2027 Term Loan that each mature on December 5, 2027. The interest rates under the Credit Agreement are based on SOFR. At March 31, 2025, the Company had no outstanding borrowings under the Senior Credit Facility. The Credit Agreement has two defined financial covenants: a consolidated net leverage ratio and a consolidated interest coverage ratio. The maximum consolidated net leverage ratio permitted under the Senior Credit Facility is 3.5 to 1.0. As of March 31, 2025, the Company's consolidated net leverage ratio was 2.17 to 1.0. The minimum consolidated interest coverage ratio permitted under the Senior Credit Facility is 3.0 to 1.0. As of March 31, 2025, the Company's consolidated interest coverage ratio was 7.70 to 1.0.

Current wording

On December 5, 2022, the Company entered into the Credit Agreement, which is comprised of a $750.0 million Senior Credit Facility and a $400.0 million 2027 Term Loan that each mature on December 5, 2027. The interest rates under the Credit Agreement are based on SOFR for U.S. dollar borrowings. At June 30, 2025, the Company had no outstanding borrowings under the Senior Credit Facility. The Credit Agreement has two defined financial covenants: a consolidated net leverage ratio and a consolidated interest coverage ratio. The maximum consolidated net leverage ratio permitted under the Senior Credit Facility is 3.5 to 1.0. As of June 30, 2025, the Company's consolidated net leverage ratio was 2.27 to 1.0. The minimum consolidated interest coverage ratio permitted under the Senior Credit Facility is 3.0 to 1.0. As of June 30, 2025, the Company's consolidated interest coverage ratio was 7.66 to 1.0.

Previous wording

The interest rate under the Senior Credit Facility is variable with a spread based on the Company's debt rating. The average rate on outstanding Euro borrowings was 3.76% over the quarter ending March 31, 2025. There were no U.S. dollar borrowings during the quarter. In addition, the Company pays a facility fee based on the applicable rate, which is variable with a spread based on the Company's debt rating, multiplied by the aggregate commitments of all of the lenders under the Senior Credit Facility. As of March 31, 2025, the Company carried investment-grade credit ratings with both Moody's (Baa2) and S&P Global (BBB-).

Current wording

The interest rate under the Senior Credit Facility is variable with a spread based on the Company's debt rating. The average rate on outstanding U.S. dollar borrowings was 5.76% over the quarter ending June 30, 2025. There were no Euro borrowings during the quarter. In addition, the Company pays a facility fee based on the applicable rate, which is variable with a spread based on the Company's debt rating, multiplied by the aggregate commitments of all of the lenders under the Senior Credit Facility. As of June 30, 2025, the Company carried investment-grade credit ratings with both Moody's (Baa2) and S&P Global (BBB-).

Previous wording

The Company has a $100 million Accounts Receivable Facility, which matures on November 30, 2026. The Accounts Receivable Facility is subject to certain borrowing base limitations and is secured by certain domestic trade accounts receivable of the Company. The Accounts Receivable Facility had no borrowing base limitations at March 31, 2025. As of March 31, 2025, the Company had $30 million of outstanding borrowings under the Accounts Receivable Facility, which reduced the availability to $70 million.

Current wording

The Company has a $100 million Accounts Receivable Facility, which matures on November 30, 2026. The Accounts Receivable Facility is subject to certain borrowing base limitations and is secured by certain domestic trade accounts receivable of the Company. The Accounts Receivable Facility had no borrowing base limitations at June 30, 2025. As of June 30, 2025, the Company had no outstanding borrowings under the Accounts Receivable Facility.

Previous wording

Other sources of liquidity include uncommitted short-term lines of credit for certain of the Company's foreign subsidiaries, which currently provide for borrowings of up to $233.8 million. At March 31, 2025, the Company had borrowings outstanding of $7.4 million and bank guarantees of $0.3 million, which reduced the aggregate availability under these facilities to $226.1 million.

Current wording

Other sources of liquidity include uncommitted short-term lines of credit for certain of the Company's foreign subsidiaries, which currently provide for borrowings of up to $249.0 million. At June 30, 2025, the Company had borrowings outstanding of $39.3 million and bank guarantees of $0.2 million, which reduced the aggregate availability under these facilities to $209.5 million.

Previous wording

The Company expects to generate a higher amount of cash from operating activities in 2025 compared to 2024, driven by improved working capital performance, a lower level of capital expenditures, and lower cash taxes. The Company expects capital expenditures in 2025 to be in the range of 3.5% of sales.

Current wording

The Company expects to generate a higher amount of cash from operating activities in 2025 compared to 2024, driven by improved working capital performance and lower cash taxes, partially offset by higher pension and other postretirement benefit contributions and payments. The Company expects capital expenditures in 2025 to be in the range of 3.5% of sales.

Previous wording

During the first three months of 2025, the Company made cash contributions and payments of $23.2 million to its global defined benefit pension plans and $0.6 million to its other postretirement benefit plans. In 2025, the Company expects to make contributions to its global defined benefit pension plans of approximately $36 million and to make payments of approximately $3 million to its other postretirement benefit plans. Excluding actuarial gains and losses, the Company expects higher pension and other postretirement benefits expense in 2025 compared to 2024 primarily due to lower expected returns on pension plan assets and higher interest expense.

Current wording

During the first six months of 2025, the Company made cash contributions and payments of $27.3 million to its global defined benefit pension plans and $1.1 million to its other postretirement benefit plans. In 2025, the Company expects to make contributions to its global defined benefit pension plans of approximately $36 million and to make payments of approximately $3 million to its other postretirement benefit plans. Excluding actuarial gains and losses, the Company expects higher pension and other postretirement benefits expense in 2025 compared to 2024 primarily due to lower expected returns on pension plan assets and higher interest expense.

Previous wording

The Company's financial statements are prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. The Company reviews its critical accounting policies throughout the year. The Company has concluded that there have been no significant changes to its critical accounting policies or estimates, as described in its Annual Report on Form 10-K for the year ended December 31, 2024, during the three months ended March 31, 2025.

Current wording

The Company's financial statements are prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. The Company reviews its critical accounting policies throughout the year. The Company has concluded that there have been no significant changes to its critical accounting policies or estimates, as described in its Annual Report on Form 10-K for the year ended December 31, 2024, during the six months ended June 30, 2025.

Previous wording

For the three months ended March 31, 2025, the Company recorded positive foreign currency translation adjustments of $66.5 million that increased shareholders' equity, compared with negative foreign currency translation adjustments of $50.3 million that decreased shareholders' equity for the three months ended March 31, 2024. The foreign currency translation adjustments for the three months ended March 31, 2025 were impacted by the weakening of the U.S. dollar relative to other foreign currencies, including the Euro, the Romanian Leu, and the Brazilian Real.

Current wording

For the six months ended June 30, 2025, the Company recorded positive foreign currency translation adjustments of $210.5 million that increased shareholders' equity, compared with negative foreign currency translation adjustments of $79.5 million that decreased shareholders' equity for the six months ended June 30, 2024. The foreign currency translation adjustments for the six months ended June 30, 2025 were impacted by the weakening of the U.S. dollar relative to other foreign currencies, including the Euro, the Chinese Renminbi, and the Romanian Leu.

Previous wording

Foreign currency exchange gains and losses, net of hedging activity, resulting from transactions included in the Company's operating results for the three months ended March 31, 2025 totaled $1.1 million of net gains, compared with $3.2 million of net losses during the three months ended March 31, 2024.

Current wording

Foreign currency exchange gains and losses, net of hedging activity, resulting from transactions included in the Company's operating results for the three months ended June 30, 2025 totaled $4.4 million of net losses, compared with $0.4 million of net losses during the three months ended June 30, 2024. Foreign currency exchange gains and losses, net of hedging activity, resulting from transactions included in the Company's operating results for the six months ended June 30, 2025 totaled $3.3 million of net losses, compared with $3.6 million of net losses during the six months ended June 30, 2024.

Previous wording

On September 5, 2024, the Company's Board appointed Tarak B. Mehta President and CEO of the Company and appointed Richard G. Kyle Advisor to the CEO. Mr. Mehta succeeded Mr. Kyle, who had served as Timken’s President and CEO since 2014. On March 31, 2025, Timken announced that the Company and Mr. Mehta had mutually agreed that Mr. Mehta would depart from the Company, including resigning as a member of the Company’s Board, effective immediately. The Company also announced that the Board had appointed Mr. Kyle as the interim President and CEO of the Company, effective immediately. During the three months ended March 31, 2025, the Company recorded severance of $9.3 million, plus related taxes, for Mr. Mehta's settlement arrangement and release of claims. Approximately two-thirds of this amount is expected to be paid in 2025, with the remaining amounts paid in 2026 and 2027.

Current wording

On September 5, 2024, the Company's Board appointed Tarak B. Mehta President and CEO and appointed Richard G. Kyle Advisor to the CEO. Mr. Mehta succeeded Mr. Kyle, who had served as Timken’s President and CEO since 2014. On March 31, 2025, Timken announced that the Company and Mr. Mehta had mutually agreed that Mr. Mehta would depart from the Company, including resigning as a member of the Company’s Board, effective immediately. The Company also announced that the Board had appointed Mr. Kyle as the interim President and CEO of the Company, effective immediately. During the three months ended March 31, 2025, the Company recorded severance of $9.3 million, plus related taxes, for Mr. Mehta's settlement arrangement and release of claims for his termination without cause. Approximately two-thirds of this amount is expected to be paid in 2025, with the remaining amounts paid in 2026 and 2027. In addition, the Company recorded stock compensation expense related to a deferred share award issued to Mr. Kyle.

Previous wording

(4) On March 31, 2025, the Company announced that Tarak B. Mehta, President and CEO of the Company would be departing from the Company, effective immediately, and Richard G. Kyle will be serving as interim President and CEO. CEO succession expenses primarily relate to the cost of the settlement agreement with Mr. Mehta in connection with his departure, net of stock compensation expense for stock awards forfeited. During 2024, the Company announced that Mr. Kyle, President and CEO of the Company would be retiring from his position as CEO as of February 15, 2025 and that Mr. Mehta would be appointed CEO on September 5, 2024. CEO succession expenses also include the acceleration of certain stock compensation awards for Mr. Kyle and other one-time costs associated with the transition in 2024.

Current wording

(4) On March 31, 2025, the Company announced that Tarak B. Mehta, President and CEO of the Company would be departing from the Company, effective immediately, and Richard G. Kyle would be serving as interim President and CEO. CEO transition expenses for 2025 primarily relate to the cost of the settlement agreement with Mr. Mehta in connection with his departure, net of the impact for stock awards forfeited, and incremental stock compensation expense related to a deferred share award issued to Mr. Kyle. During 2024, the Company announced that Mr. Kyle, President and CEO of the Company would be retiring from his position as CEO as of February 15, 2025, and that Mr. Mehta would be appointed CEO on September 5, 2024. CEO transition expenses for 2024 relate to the acceleration of certain stock compensation awards for Mr. Kyle and other one-time costs associated with the transition in 2024.

Previous wording

The ratio of net debt to adjusted EBITDA for the trailing twelve months represents total debt less cash and cash equivalents divided by adjusted EBITDA for the trailing twelve months. The Company presents net debt to adjusted EBITDA because it believes it is more representative of the Company's financial position as it is reflective of the Company's ability to cover its net debt obligations with results from its core operations. Net income for the trailing twelve months ended March 31, 2025 and December 31, 2024 was $356.1 million and $375.3 million, respectively. Net debt to adjusted EBITDA for the trailing twelve months was 2.2 and 2.0 at March 31, 2025 and December 31, 2024.

Current wording

The ratio of net debt to adjusted EBITDA for the trailing twelve months represents total debt less cash and cash equivalents divided by adjusted EBITDA for the trailing twelve months. The Company presents net debt to adjusted EBITDA because it believes it is more representative of the Company's financial position as it is reflective of the Company's ability to cover its net debt obligations with results from its core operations. Net income for the trailing twelve months ended June 30, 2025 and December 31, 2024 was $339.8 million and $375.3 million, respectively. Net debt to adjusted EBITDA for the trailing twelve months was 2.3 and 2.0 at June 30, 2025 and December 31, 2024, respectively.