TIMKEN CO

Previous 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®, Bijur Delimon®, Des-Case®, Diamond®, Drives®, 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.

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, 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®, Bijur Delimon®, Des-Case®, Diamond®, Drives®, 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

The following items highlight some of the Company's more significant strategic accomplishments during the three and six months ended June 30, 2026:

Current wording

The following items highlight some of the Company's more significant strategic accomplishments during the three and nine months ended September 30, 2026:

Previous wording

•On March 18, 2026, the Company acquired the assets and related businesses of Bijur Delimon, a leading global designer and manufacturer of automated lubrication systems. Founded in 1872, Bijur Delimon operates manufacturing locations in the U.S., Europe and Asia Pacific. The acquisition of Bijur Delimon expands the Company's position in automated lubrication systems and operating results for the business are included in the Industrial Motion segment.

Current wording

•On March 18, 2026, the Company acquired the assets and related businesses of Bijur Delimon, a leading global designer and manufacturer of automated lubrication systems. Founded in 1872, Bijur Delimon operates manufacturing locations in the U.S., Europe and Asia Pacific. The acquisition of Bijur Delimon expands the Company's position in automated lubrication systems.

Previous wording

•The Company increased its quarterly dividend by 3% and paid its 416 th consecutive quarterly dividend on May 29, 2026. The Company also repurchased 437,000 common shares during the six months ended June 30, 2026.

Current wording

•The Company increased its quarterly dividend by 3% in the second quarter of 2026 and paid its 417 th consecutive quarterly dividend on August 28, 2026. The Company also repurchased approximately 941,000 common shares during the nine months ended September 30, 2026.

Previous wording

Net sales increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025. The increase was primarily driven by higher volume in both segments, the benefit of acquisitions, the favorable impact of foreign currency and favorable pricing. Net sales increased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025. The increase was primarily driven by the favorable impact of higher end-market demand across both segments, foreign currency, favorable pricing and the benefit of acquisitions.

Current wording

Net sales increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025. The increase was primarily driven by higher end-market demand in the Industrial Motion segment, the benefit of acquisitions and favorable pricing. Net sales increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025. The increase was primarily driven by the favorable impact of higher end-market demand across both segments, favorable pricing, foreign currency and the benefit of acquisitions.

Previous wording

Net income decreased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025 primarily due to higher impairment charges and higher SG&A expense, partially offset by favorable price/mix, higher volume, lower tax expense, and the favorable impact of International Emergency Economic Powers Act (“IEEPA”) tariff refunds. Net income decreased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025 primarily due to higher impairment charges, incremental tariff costs, higher SG&A expense and higher manufacturing costs, partially offset by favorable price/mix, higher volume and the favorable impact of foreign currency exchange rates.

Current wording

Net income increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025 primarily due to the favorable impact of International Emergency Economic Powers Act (“IEEPA”) tariff refunds, favorable price/mix and the benefit of acquisitions, partially offset by higher SG&A expense. Net income decreased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025 primarily due to higher impairment charges and higher SG&A expense, partially offset by favorable price/mix, higher volume and the favorable impact of foreign currency exchange rates.

Previous wording

The Company expects 2026 full-year revenues to be up approximately 5% to 6% compared to 2025, primarily driven by higher demand across both segments, favorable pricing, the benefit of acquisitions, and the favorable impact of foreign currency rate changes. The Company's earnings are expected to be down slightly in 2026 compared with 2025 due to higher impairment charges, mostly offset by the impact of higher organic sales volume and favorable price/mix.

Current wording

The Company expects 2026 full-year revenue to be up approximately 5% to 6% compared to 2025, primarily driven by higher demand across both segments, favorable pricing, the favorable impact of foreign currency rate changes and the benefit of acquisitions. The Company's earnings are expected to be flat in 2026 compared with 2025 with higher impairment and restructuring charges, offset by the impact of favorable price/mix and higher organic sales volume.

Previous wording

The Company expects to generate a comparable amount of cash from operating activities, with $550 million in 2026 compared to $554.3 million in 2025. The Company expects capital expenditures in 2026 to be approximately 3.3% of sales.

Current wording

The Company expects to generate slightly lower cash from operating activities in 2026, compared to 2025, with $540 million in 2026 compared to $554.3 million in 2025. The Company expects capital expenditures in 2026 to be approximately 3.1% of sales.

Previous wording

Net sales increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025. The increase was driven by the favorable impact of higher organic revenue of $52 million, the benefit of acquisitions of $21 million and foreign currency exchange rate changes of $15 million. Net sales increased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025. The increase was driven by the favorable impact of higher organic revenue of $101 million, foreign currency exchange rate changes of $54 million, and the benefit of acquisitions of $24 million.

Current wording

Net sales increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025. The increase was driven by the favorable impact of higher organic revenue of $32 million and the benefit of acquisitions of $21 million. Net sales increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025. The increase was driven by the favorable impact of higher organic revenue of $133 million, foreign currency exchange rate changes of $55 million and the benefit of acquisitions of $44 million.

Previous wording

•Cost of products sold increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025, primarily due to the incremental cost of goods sold from acquisitions of $16 million, higher volume of $11 million, an inventory adjustment of $10 million related to the belts business and unfavorable foreign currency exchange rate changes of $10 million. Cost of products sold increased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025, due to unfavorable foreign currency exchange rate changes of $38 million, the incremental cost of goods sold from acquisitions of $18 million, the impact of higher manufacturing costs of $16 million, incremental tariff costs, net of IEEPA tariff refunds, of $14 million, higher volume of $11 million and an inventory adjustment of $10 million related to belts business.

Current wording

•Cost of products sold increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025, primarily due to higher volume of $16 million and the incremental cost of goods sold from acquisitions of $13 million, partially offset by IEEPA tariff refunds, net of incremental tariff costs, of $19 million. Cost of products sold increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025, due to unfavorable foreign currency exchange rate changes of $36 million, the incremental cost of goods sold from acquisitions of $32 million, higher volume of $27 million, the impact of higher manufacturing costs of $21 million and an inventory adjustment of $12 million related to belts business.

Previous wording

•SG&A expenses increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025, primarily due to higher employee compensation, the impact of acquisitions, higher discretionary spending and the unfavorable impact from foreign currency exchange rates. SG&A expenses increased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025, primarily due to the unfavorable impact from foreign currency exchange rates, higher employee compensation, the impact of acquisitions and higher discretionary spending.

Current wording

•SG&A expenses increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025, primarily due to higher employee compensation, the impact of acquisitions and higher discretionary spending. SG&A expenses increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025, primarily due to higher employee compensation, the impact of acquisitions, the unfavorable impact from foreign currency exchange rates and higher discretionary spending.

Previous wording

•Impairment and restructuring charges were higher for the three and six months ended June 30, 2026 compared with the three and six months ended June 30, 2025, primarily due to impairment charges for certain assets related to the planned belts divestiture recorded during the three months ended June 30, 2026.

Current wording

•Impairment and restructuring charges were higher for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025, primarily due to impairment charges for certain assets related to the belts divestiture recorded during the nine months ended September 30, 2026, as well as higher severance and related benefits and other exit costs.

Previous wording

The decrease in interest expense for the three and six months ended June 30, 2026 compared with the three and six months ended June 30, 2025 was primarily due to lower interest rates and lower average debt levels.

Current wording

The decrease in interest expense for the three months ended September 30, 2026 compared with the three months ended September 30, 2025 was primarily due to lower average debt levels. The decrease in interest expense for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025 was primarily due to lower interest rates and lower average debt levels.

Previous wording

Income tax expense increased by $0.1 million for the six months ended June 30, 2026 compared with the six months ended June 30, 2025 primarily due to favorable discrete items recognized in the prior period related to the reversal of accruals for uncertain tax positions to account for the expiration of statutes of limitation in jurisdictions outside of U.S. This increase was mostly offset by lower pre-tax earnings as a result of the agreement to sell certain assets of the belts business and the impact of beneficial provisions effective in 2026 from the OBBBA.

Current wording

Income tax expense increased $7.6 million for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025 primarily due to favorable discrete items recognized in the prior-year period related to the reversal of accruals for uncertain tax positions to account for the expiration of the statutes of limitation in jurisdictions outside of the U.S.

Previous wording

The presentation of segment results below includes a reconciliation of the changes in net sales for each segment reported in accordance with U.S. GAAP to net sales adjusted to remove the effects of the acquisition completed in 2026 and foreign currency exchange rate changes. The effects of acquisitions and foreign currency exchange rate changes on net sales are removed to allow investors and the Company to meaningfully evaluate the percentage change in net sales on a comparable basis from period to period.

Current wording

The presentation of segment results below includes a reconciliation of the changes in net sales for each segment reported in accordance with U.S. GAAP to net sales adjusted to remove the effects of acquisitions completed in 2026 and foreign currency exchange rate changes. The effects of acquisitions and foreign currency exchange rate changes on net sales are removed to allow investors and the Company to meaningfully evaluate the percentage change in net sales on a comparable basis from period to period.

Previous wording

The Engineered Bearings segment's net sales, excluding the effects of foreign currency exchange rate changes, increased $42.4 million or 2.8% in the six months ended June 30, 2026 compared with the six months ended June 30, 2025. The increase was primarily driven by higher pricing and higher volume. Adjusted EBITDA for the Engineered Bearings segment increased for the six months ended June 30, 2026 by $7.7 million or 2.5% compared with the three months ended June 30, 2025, due to favorable price/mix, partially offset by incremental tariff costs, net of IEEPA tariff refunds, and higher operating costs.

Current wording

The Engineered Bearings segment's net sales, excluding the effects of foreign currency exchange rate changes, increased $3.6 million or 0.5% in the three months ended September 30, 2026 compared with the three months ended September 30, 2025. The increase was primarily driven by higher pricing. Adjusted EBITDA for the Engineered Bearings segment increased for the three months ended September 30, 2026 by $11.6 million or 8.0% compared with the three months ended September 30, 2025, due to IEEPA tariff refunds, net of incremental tariff costs, and favorable price/mix, partially offset by higher SG&A expense and higher manufacturing costs.

Previous wording

The Engineered Bearings segment's net sales, excluding the effects of foreign currency exchange rate changes, increased $19.8 million or 2.5% in the three months ended June 30, 2026 compared with the three months ended June 30, 2025. The increase was primarily driven by higher volume across most sectors and higher pricing. Adjusted EBITDA for the Engineered Bearings segment increased for the three months ended June 30, 2026 by $7.9 million or 5.1% compared with the three months ended June 30, 2025, due to favorable price/mix and higher volume, partially offset by higher SG&A expense and higher manufacturing costs.

Current wording

The Engineered Bearings segment's net sales, excluding the effects of foreign currency exchange rate changes, increased $46.0 million or 2.0% in the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025. The increase was primarily driven by higher pricing and higher volume. Adjusted EBITDA for the Engineered Bearings segment increased for the nine months ended September 30, 2026 by $19.3 million or 4.2% compared with the nine months ended September 30, 2025, due to favorable price/mix, partially offset by higher operating costs.

Previous wording

•Cost of products sold increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025 due to higher volume of $7 million, unfavorable foreign currency exchange rate changes of $5 million and higher operating costs of $5 million.

Current wording

•Cost of products sold increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025 due to higher operating costs of $23 million and unfavorable foreign currency exchange rate changes of $21 million, partially offset by IEEPA tariff refunds, net of incremental tariff costs, of $7 million.

Previous wording

The Industrial Motion segment's net sales, excluding the effects of acquisitions and foreign currency exchange rate changes, increased $32.0 million or 8.1% in the three months ended June 30, 2026 compared with the three months ended June 30, 2025. The increase reflects higher demand across most end market sectors and higher pricing. Adjusted EBITDA increased $33.0 million or 45.5% for the three months ended June 30, 2026 compared with the three months ended June 30, 2025, driven primarily by favorable price/mix and higher volume.

Current wording

The Industrial Motion segment's net sales, excluding the effects of acquisitions and foreign currency exchange rate changes, increased $28.7 million or 7.3% in the three months ended September 30, 2026 compared with the three months ended September 30, 2025. The increase reflects higher demand across most end market sectors and higher pricing. Adjusted EBITDA increased $12.5 million or 16.8% for the three months ended September 30, 2026 compared with the three months ended September 30, 2025, driven primarily by higher volume and favorable price/mix.

Previous wording

•Cost of products sold increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025 due to the impact of acquisitions of $13 million, higher volume of $4 million and unfavorable foreign currency exchange rate changes of $4 million.

Current wording

•Cost of products sold increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025 due to higher volume of $17 million and the impact of acquisitions of $13 million.

Previous wording

•SG&A expenses increased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025 primarily due to the incremental SG&A expense from acquisitions and the unfavorable impact of foreign currency exchange rates.

Current wording

•SG&A expenses increased for the three months ended September 30, 2026 compared with the three months ended September 30, 2025 primarily due to the incremental SG&A expense from acquisitions and higher compensation expense.

Previous wording

The Industrial Motion segment's net sales, excluding the effects of acquisitions and foreign currency exchange rate changes, increased $58.6 million or 7.6% in the six months ended June 30, 2026 compared with the six months ended June 30, 2025. The increase reflects higher demand across most end market sectors and higher pricing. Adjusted EBITDA increased $57.2 million or 40.9% for the six months ended June 30, 2026 compared with the six months ended June 30, 2025. Favorable price/mix and higher volume were partially offset by the unfavorable impact of incremental tariff costs, net of IEEPA tariff refunds.

Current wording

The Industrial Motion segment's net sales, excluding the effects of acquisitions and foreign currency exchange rate changes, increased $87.3 million or 7.5% in the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025. The increase reflects higher demand across most end market sectors and higher pricing. Adjusted EBITDA increased $69.7 million or 32.5% for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025, driven primarily by favorable price/mix and higher volume.

Previous wording

•Cost of products sold increased for the six months ended June 30, 2026 compared with the six months ended June 30, 2025 due to the unfavorable foreign currency exchange rate changes of $16 million, the impact of acquisitions of $15 million and higher volume of $6 million.

Current wording

•Cost of products sold increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025 due to the impact of acquisitions of $28 million, higher volume of $22 million and the unfavorable foreign currency exchange rate changes of $15 million.

Previous wording

•SG&A expenses increased for the three months ended June 30, 2026 compared with the three months ended June 30, 2025 primarily due to the incremental SG&A expense from acquisitions and the unfavorable impact of foreign currency exchange rates.

Current wording

•SG&A expenses increased for the nine months ended September 30, 2026 compared with the nine months ended September 30, 2025 primarily due to the incremental SG&A expense from acquisitions, the unfavorable impact of foreign currency exchange rates and higher compensation expense.

Previous wording

Unallocated corporate expense increased for the three and six months ended June 30, 2026 compared with the three and six months ended June 30, 2025 primarily due to higher compensation expense.

Current wording

Unallocated corporate expense increased for the three and nine months ended September 30, 2026 compared with the three and nine months ended September 30, 2025 primarily due to higher compensation expense.

Previous wording

The decrease in net cash provided by operating activities for the first six months of 2026 compared with the first six months of 2025 was primarily due to the unfavorable impact of working capital items of $92.1 million and a decrease in net income of $34.0 million, partially offset by higher impairment charges of $79.0 million, the favorable impact of income taxes on cash of $13.0 million and lower pension contributions of $10.3 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 increase in net cash provided by operating activities for the first nine months of 2026 compared with the first nine months of 2025 was primarily due to higher net income, net of non-cash impairment charges, of $59.4 million, and the favorable impact of income taxes on cash of $24.0 million and lower pension and other postretirement benefit contributions and payments of $7.9 million, partially offset by the unfavorable impact of working capital items of $70.3 million. 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 six months of 2026 and 2025:

Current wording

The following table displays the impact of working capital items on cash during the first nine months of 2026 and 2025:

Previous wording

The following table displays the impact of income taxes on cash during the firstsix months of 2026 and 2025:

Current wording

The following table displays the impact of income taxes on cash during the first nine months of 2026 and 2025:

Previous wording

The increase in net cash used in investing activities for the first six months of 2026 compared with the first six months of 2025 was due to an increase in cash used for acquisitions of $124.4 million.

Current wording

The increase in net cash used in investing activities for the first nine months of 2026 compared with the first nine months of 2025 was primarily due to an increase in cash used for acquisitions of $123.1 million, partially offset by proceeds from divestitures of $26.3 million.

Previous wording

The change in net cash provided by (used in) financing activities for the first six months of 2026 compared with the first six months of 2025 was due to the favorable change in net debt borrowings/payments of $158.5 million.

Current wording

The change in net cash used in financing activities for the first nine months of 2026 compared with the first nine months of 2025 was due to the favorable change in net debt borrowings/payments of $105.1 million and a decrease in dividends paid to noncontrolling interest of $14.1 million, partially offset by an increase in the purchase of treasury shares of $66.1 million.

Previous wording

At June 30, 2026, the Company had strong liquidity with $399.1 million of cash and cash equivalents on the Consolidated Balance Sheet, as well as $651.6 million available under committed credit lines. Of the $399.1 million of cash and cash equivalents, $372.5 million resided in jurisdictions outside the U.S. 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 U.S. 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 September 30, 2026, the Company had strong liquidity with $410.2 million of cash and cash equivalents on the Consolidated Balance Sheet, as well as $1.13 billion available under committed credit lines. Of the $410.2 million of cash and cash equivalents, $375.4 million resided in jurisdictions outside the U.S. 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 U.S. 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 million Senior Credit Facility and a $400 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, 2026, the Company had $118.4 million of outstanding borrowings under the Senior Credit Facility, which reduced the availability to $631.6 million. 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, 2026, the Company's consolidated net leverage ratio was 2.02 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, 2026, the Company's consolidated interest coverage ratio was 8.78 to 1.0.

Current wording

On July 2, 2026, the Company entered into the Amended Credit Agreement, which is comprised of a $1.2 billion Senior Credit Facility that matures on July 2, 2031, with two potential one-year extension options subject to customary terms and conditions. The interest rates under the Amended Credit Agreement are based on SOFR for U.S. dollar borrowings. At September 30, 2026, the Company had $169.0 million of outstanding borrowings under the Senior Credit Facility, which reduced the availability to $1.03 billion. The Amended 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 3.75 to 1.0. As of September 30, 2026, the Company's consolidated net leverage ratio was 1.82 to 1.0. The minimum consolidated interest coverage ratio permitted under the Senior Credit Facility is 3.0 to 1.0. As of September 30, 2026, the Company's consolidated interest coverage ratio was 9.23 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 U.S. dollar borrowings was 4.79% and the average rate on outstanding Euro borrowings was 3.03% as of June 30, 2026. 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, 2026, 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 5.10% and the average rate on outstanding Euro borrowings was 3.23% as of September 30, 2026. 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 September 30, 2026, 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, 2028. The Accounts Receivable Facility is subject to certain borrowing base limitations and is secured by certain domestic trade accounts receivable of the Company. As of June 30, 2026, the Company had $80 million of outstanding borrowings under the Accounts Receivable Facility, which reduced the availability to $20 million.

Current wording

The Company has a $100 million Accounts Receivable Facility, which matures on November 30, 2028. On September 17, 2026, the Company exercised the accordion feature for the Accounts Receivable Facility, increasing the availability under the facility from $100 million to $125 million. The Accounts Receivable Facility is subject to certain borrowing base limitations and is secured by certain domestic trade accounts receivable of the Company. As of September 30, 2026, there were no outstanding borrowings under the Accounts Receivable Facility; however, the Company had issued standby letters of credit of $22.9 million under the Accounts Receivable Facility, reducing the availability to $102.1 million.

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 $249.4 million. At June 30, 2026, the Company had borrowings outstanding of $26.3 million and bank guarantees of $7.2 million, which reduced the aggregate availability under these facilities to $215.9 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 $248.5 million. At September 30, 2026, the Company had borrowings outstanding of $10.8 million and bank guarantees of $5.4 million, which reduced the aggregate availability under these facilities to $232.3 million.

Previous wording

The Company expects to generate a comparable amount of cash from operating activities, with $550 million in 2026 compared to $554.3 million in 2025. The Company expects capital expenditures in 2026 to be approximately 3.3% of sales.

Current wording

The Company expects to generate slightly lower cash from operating activities in 2026, compared to 2025, with $540 million in 2026 compared to $554.3 million in 2025. The Company expects capital expenditures in 2026 to be approximately 3.1% of sales.

Previous wording

During the first six months of 2026, the Company made cash contributions and payments of $17.2 million to its global defined benefit pension plans and $0.9 million to its other postretirement benefit plans. In 2026, the Company expects to make contributions to its global defined benefit pension plans of approximately $32 million and to make payments of approximately $3 million to its other postretirement benefit plans. Excluding actuarial gains and losses, the Company expects lower pension and other postretirement benefits expense in 2026 compared to 2025 primarily due to higher expected returns on pension plan assets and lower interest expense.

Current wording

During the first nine months of 2026, the Company made cash contributions and payments of $25.9 million to its global defined benefit pension plans and $1.3 million to its other postretirement benefit plans. In 2026, the Company expects to make contributions to its global defined benefit pension plans of approximately $33 million and to make payments of approximately $2 million to its other postretirement benefit plans. Excluding actuarial gains and losses, the Company expects lower pension and other postretirement benefits expense in 2026 compared to 2025 primarily due to higher expected returns on pension plan assets and lower 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, 2025, during the six months ended June 30, 2026.

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, 2025, during the nine months ended September 30, 2026.

Previous wording

For the six months ended June 30, 2026, the Company recorded negative foreign currency translation adjustments of $26.2 million that decreased shareholders' equity, compared with positive foreign currency translation adjustments of $210.5 million that increased shareholders' equity for the six months ended June 30, 2025. The foreign currency translation adjustments for the six months ended June 30, 2026 were impacted by the strengthening of the U.S. dollar relative to other foreign currencies, including the Euro and the Indian Rupee.

Current wording

For the nine months ended September 30, 2026, the Company recorded negative foreign currency translation adjustments of $35.1 million that decreased shareholders' equity, compared with positive foreign currency translation adjustments of $199.7 million that increased shareholders' equity for the nine months ended September 30, 2025. The foreign currency translation adjustments for the nine months ended September 30, 2026 were impacted by the strengthening of the U.S. dollar relative to certain foreign currencies, including the Euro and the Indian Rupee, partially offset by the weakening of the U.S. dollar relative to other foreign currencies, including the Chinese Renminbi.

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 June 30, 2026 and June 30, 2025 totaled $4.4 million of net losses in each period. 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, 2026 totaled $7.7 million of net losses, compared with $3.3 million of net losses during the six months ended June 30, 2025.

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 September 30, 2026 and September 30, 2025 totaled $1.8 million and $4.9 million of net losses, respectively. Foreign currency exchange gains and losses, net of hedging activity, resulting from transactions included in the Company's operating results for the nine months ended September 30, 2026 and September 30, 2025 totaled $9.5 million and $8.1 million of net losses, respectively .