TRIMAS CORP

Previous wording

TriMas designs, develops and manufactures a diverse set of products primarily for the consumer products, aerospace & defense and industrial markets through its TriMas Packaging, TriMas Aerospace and Specialty Products groups. Our wide range of innovative products are designed and engineered to solve application-specific challenges that our customers face. We believe our businesses share important and distinguishing characteristics, including: well-recognized and leading brand names in the markets we serve; innovative product technologies and features; a high-degree of customer approved processes and qualifications; established distribution networks; modest capital investment requirements; strong cash flow conversion and long-term growth opportunities. While the majority of our revenue is in the United States, we manufacture and supply products globally to a wide range of companies. We report our business activity in three segments: Packaging, Aerospace and Specialty Products.

Current wording

TriMas designs, develops and manufactures a diverse set of products primarily for the consumer products and industrial markets through its TriMas Packaging and Specialty Products groups. Our wide range of innovative products are designed and engineered to solve application-specific challenges that our customers face. We believe our businesses share important and distinguishing characteristics, including: innovative product technologies and features; a high-degree of customer approved processes and qualifications; established distribution networks; modest capital investment requirements; strong cash flow conversion and long-term growth opportunities. While the majority of our revenue is in the United States, we manufacture and supply products globally to a wide range of companies. We are principally engaged in two reportable segments: Packaging and Specialty Products.

Previous wording

Our results of operations have been materially impacted over the past few years by macro-economic factors, first by the onset and proliferation of the coronavirus pandemic ("pandemic"), then further from increased energy costs and supply chain disruptions from the Russia-Ukraine conflict, and more recently by cost inflation (raw materials, wage rates and freight) a lack of material and in certain regions skilled labor availability, as well as recent periods of destocking from prior periods of over-ordering by customers. These factors significantly affected each of our businesses and how we operate, albeit in different ways and magnitudes. Sales in our Packaging segment for dispensing and closure products used in applications to help fight the spread of germs have experienced extreme volatility in demand, with demand spiking to record highs after the onset of the pandemic, demand abating as expected from those high levels beginning mid-2022 and continuing through most of 2023, as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in purchasing behaviors given the current inflationary macro-economic environment. Sales of certain of our aerospace-related products were significantly depressed from historical levels following the onset of the pandemic, but demand has significantly increased in recent quarters as air travel has picked-up and new aircraft build rates improve. Certain of our products for industrial applications, for example steel cylinders for packaged gas applications, have experienced volatility in demand related to customers securing high order rates in prior periods, only to enter a period of destocking in more recent periods. Altogether, this significant level of volatility in demand levels, input and transportation costs, and material and labor availability, have pressured our ability to operate efficiently in recent periods. While some areas of demand volatility and softness remain, such as in our Specialty Products segment, and more specifically our Norris Cylinder business, we have experienced more steady and consistent demand in our Packaging and Aerospace segments.

Current wording

Sales of certain of our products for industrial applications, for example steel cylinders for packaged gas applications, have experienced volatility in demand related to customers securing high order rates in prior periods, only to enter a period of destocking in more recent periods. This significant level of volatility in demand levels, input and transportation costs, and material and labor availability, have pressured our ability to operate efficiently in recent periods. While some areas of demand volatility and softness remain, such as in our our Norris Cylinder business within our Specialty Products segment, we have experienced more steady and consistent demand in our Packaging segment.

Previous wording

The most significant drivers affecting our financial results in 2024 compared with 2023, other than as directly impacted by sales changes, were the impact of our recent acquisitions, accelerated depreciation charges related to shortening the useful lives of certain machinery and equipment in our Specialty Products segment, increased costs and decreased sales resulting from a prolonged labor union strike at one of our manufacturing facilities within our Aerospace segment, a charge to update our asbestos liability based on our recent actuarial valuation, improved material availability within our Aerospace segment, charges associated with environmental remediation liabilities, increased input costs, including expedited freight within our Packaging segment, lower realignment charges, and a decrease in our effective tax rate.

Current wording

The most significant drivers affecting our financial results in 2025 compared with 2024, other than as directly impacted by sales changes, were the impact of the divestiture of our Arrow Engine business, our recognition of a net benefit to recognize our asbestos insurance recovery asset and update our liability to our recent actuarial valuation, realignment costs related to actions to reorganize our corporate office, charges associated with environmental remediation liabilities, the refinancing of our existing Credit Agreement ("Credit Agreement"), the year-over-year impact of accelerated depreciation charges in 2024 related to shortening the useful lives of certain machinery and equipment in our Specialty Products segment, and a decrease in our effective tax rate.

Previous wording

In 2024, we commissioned our actuary to update our asbestos study, and upon completion we recorded a pre-tax charge of $5.5 million, which is included in selling, general and administrative expenses.

Current wording

In third quarter 2025, we commissioned our actuary to update our asbestos study, and upon completion we recorded a pre-tax charge of $8.0 million. In the fourth quarter 2025, we reassessed the facts and circumstances surrounding the CIP agreement with the consortium of insurance companies and deemed the realization of the claim for loss recovery probable. We estimated the loss recovery of indemnity and defense costs under the CIP agreement, and recognized an insurance recovery asset of $35.8 million, which was commensurate with the assumptions used to calculate the asbestos liability. See Note 16, "Commitments and Contingencies," to our consolidated financial statements attached herein with this Form 10-K.

Previous wording

In 2024, we recorded a pre-tax charges of $3.6 million for environmental remediation for waste sites in which we had been named a potential responsible party.

Current wording

During 2025 we recorded pre-tax charges of $6.5 million for environmental remediation for waste sites in which we had been named a potential responsible party. In 2024, we recorded pre-tax charges of $3.2 million for similar environmental matters.

Previous wording

Our effective tax rate for 2024 and 2023 was 19.3%, and 20.2%, respectively. The decrease in effective tax rate 2024 as compared to 2023 is primarily as a result of a change in the mix of domestic and foreign pre-tax results.

Current wording

Our effective tax rate for 2025 and 2024 was (198.1)%, and 53.3%, respectively. The decrease in effective tax rate for 2025 as compared to 2024 is primarily as a result of us recognizing a $53.9 million tax benefit in 2025 related to the tax-basis versus book-basis difference in our Aerospace business. Otherwise, the remaining difference is due to a change in the mix of domestic and foreign pre-tax results.

Previous wording

We have executed meaningful realignment actions over the past few years to address variable and structural costs where demand has fallen. We will continue to assess and take further actions if required. However, as a result of the current period of macroeconomic inflation and uncertainty and the potential impact of such factors to our future results of operations, as well as if there is an impact to TriMas' overall performance and market capitalization, we may record additional cash and non-cash charges related to further realignment actions, asset impairments, including impairments to our goodwill, intangible assets, fixed assets, inventory or customer receivable account balances.

Current wording

We have executed meaningful realignment actions over the past few years to address variable and structural costs where demand has fallen. We will continue to assess and take further actions if required. However, as a result of the current period of macroeconomic inflation and uncertainty, including uncertainty regarding the scope and duration of current and future tariffs and trade actions, and the potential impact of such factors to our future results of operations, as well as if there is an impact to TriMas' overall performance and market capitalization, we may record additional cash and non-cash charges related to further realignment actions, asset impairments, including impairments to our goodwill, intangible assets, fixed assets, inventory or customer receivable account balances.

Previous wording

We are sensitive to price movements and availability of our raw materials supply. Our largest raw material purchases are for polypropylene, polyethylene, steel, aluminum, superalloys (such as titanium, A286 stainless steel and Inconel) and other oil and metal-based purchased components, the costs for each of which are subject to volatility. There has also been some volatility over the past two years as a direct and indirect result of foreign trade policy, where tariffs on certain of our commodity-based products sourced from Asia have been instituted, the conflict in Eastern Europe, creating certain input material shortages, and labor shortages at certain of our raw material suppliers. We will continue to take actions to mitigate such increases, including implementing commercial pricing adjustments, holding extra inventories, resourcing to alternate suppliers and insourcing of previously sourced products. Although we believe we are generally able to mitigate the impact of higher commodity costs over time, we may experience additional material costs and disruptions in supply in the future and may not be able to pass along higher costs to our customers in the form of price increases or otherwise mitigate the impacts to our operating results.

Current wording

In addition, in 2025, the U.S. government announced baseline tariffs on products from all countries and additional individualized reciprocal tariffs on the countries with which the United States has the largest trade deficits, including China. We will continue to take actions to mitigate such increases, including implementing commercial pricing adjustments, holding extra inventories, resourcing to alternate suppliers and insourcing of previously sourced products. Although we believe we are generally able to mitigate the impact of higher commodity costs over time, we may experience additional material costs and disruptions in supply in the future and may not be able to pass along higher costs to our customers in the form of price increases or otherwise mitigate the impacts to our operating results.

Previous wording

Oil-based commodity costs are a significant driver of raw materials and purchased components used within our Packaging segment. As such, an increase in crude oil often is a precursor to rising polymeric raw material costs, for which we may experience a contractual commercial recover lag. Separately, our Arrow Engine business in our Specialty Products segment is sensitive to the demand for natural gas and crude oil in North America. For example, demand for engine, pump jack and compressor products are impacted by active oil and gas rig counts and wellhead investment activities.

Current wording

Oil-based commodity costs are a significant driver of raw materials and purchased components used within our Packaging segment. As such, an increase in crude oil often is a precursor to rising polymeric raw material costs, for which we may experience a contractual commercial recovery lag.

Previous wording

Each year, as a core tenet of the TriMas Business Model, our businesses target cost savings from Kaizen (continuous improvement) initiatives in an effort to reduce, or otherwise offset, the impact of increased input and conversion costs through increased throughput and yield rates, with a goal of at least covering inflationary and market cost increases. In addition, we continuously review our operating cost structures to ensure alignment with current market demand.

Current wording

Each year our businesses target continuous improvement initiatives in an effort to reduce, or otherwise offset, the impact of increased input and conversion costs through increased throughput and yield rates, with a goal of at least covering inflationary and market cost increases. In addition, we continuously review our operating cost structures to ensure alignment with current market demand.

Previous wording

We continue to evaluate alternatives to redeploy the cash generated by our businesses, one of which includes returning capital to our shareholders. In 2020, our Board of Directors increased the authorization of share repurchases to a cumulative amount of $250 million. During 2024, we purchased 771,067 shares of our outstanding common stock for an aggregate purchase price of $19.3 million. As of December 31, 2024, we had $67.6 million remaining under the repurchase authorization.

Current wording

We continue to evaluate alternatives to redeploy the cash generated by our businesses, one of which includes returning capital to our shareholders. In November 2025, our Board of Directors authorized us to increase the purchase of our common stock up to $150 million in the aggregate, adding to the $65.4 million remaining under the previous authorization. During 2025, 2024 and 2023, we purchased 3,124,866, 771,067 and 680,594 shares of outstanding common stock for $103.3 million, $19.3 million and $18.8 million, respectively. As of December 31, 2025, we had $48.9 million remaining under the repurchase authorization. See Note 24, "Subsequent Events," included in Item 8, "Financial Statements and Supplementary Data," within this Form 10-K for an update on our authorization.

Previous wording

In addition, in 2024, we declared quarterly dividends of$0.04 per share of common stock, aggregating todividends declared and paid on common shares during 2024 of $6.6 million. We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, as well as dividends, depending on market conditions and other factors.

Current wording

In addition, in 2025, we declared quarterly dividends of $0.04 per share of common stock, aggregating to dividends declared and paid on common shares during 2025 of $6.6 million. We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, as well as dividends, depending on market conditions and other factors.

Previous wording

The following table summarizes financial information for our three reportable segments (dollars in thousands):

Current wording

The following table summarizes financial information for our reportable segments (dollars in thousands):

Previous wording

•Increases in demand for products within our Packaging and Aerospace segments;

Current wording

•Increases in demand for products within our Packaging and Specialty Products segments;

Previous wording

Through 2024, we proactively managed through a significant destocking period and resulting demand trough as compared to the prior year period within our cylinder business. We also managed through a labor union strike at one of our Aerospace production facilities, and we navigated increased input costs as a result of abruptly increased orders for certain dispensing applications within our Packaging segment. We recently completed the divestiture of our Arrow Engine business, exiting our direct presence in the oil and gas market sector. As we look to 2025, we anticipate continued strength and operating leverage from our Aerospace business. We expect modest organic sales growth within our Packaging segment, while having the opportunity to improve our production throughput and reduce certain input costs. Within the cylinder business in Specialty Products, we believe we will see marginal improvement in demand as inventory positions are further depleted, and therefore, we anticipate sequential improvement in operating profit as we move forward given these anticipated incremental sales and structural costs saving actions we have already implemented. We will continue to monitor trends in demand changes and adjust costs and investments accordingly.

Current wording

•The divestiture of our Arrow Engine business;

Previous wording

Packaging. Net sales increased $48.7 million, or 10.5% (of which 10.3% was organic, 0.6% related to acquisitions, and (0.4)% was foreign currency exchange), to $512.3 million in 2024, as compared to $463.6 million in 2023. Acquisition-related sales growth was $2.8 million from the January 2024 sales of our February 2023 acquisition of Aarts. Sales of dispensing products used primarily for beauty, personal care and home care applications increased organically by $38.2 million. Sales of products used for industrial applications increased by $13.0 million. These increases were partially offset by the decrease in sales of products used in food and beverage applications of $3.1 million, primarily due to reduced demand for certain flexible packaging applications in North America and beverage closure applications in Europe as certain customers prepare for cutting over to a new product design. The increase in net sales was also offset by $2.0 million due to currency exchange, as our reported results in U.S. dollars were unfavorably impacted as a result of the strengthening U.S. dollar relative to foreign currencies, as compared to 2023.

Current wording

Packaging. Net sales increased $23.2 million, or 4.5% (of which 4.1% was organic and 0.4% was foreign currency exchange), to $535.5 million in 2025, as compared to $512.3 million in 2024. Sales of dispensing products used primarily for beauty, personal care and home care applications increased by $25.4 million. Sales of products used in life sciences markets increased by $7.7 million, sales of products used for industrial applications increased by $3.0 million, and sales of other consumer goods products increased by $7.2 million. These increases were partially offset by the decrease in sales of products used in food and beverage applications of $22.2 million. Net sales increased by $2.2 million due to currency exchange, as our reported results in U.S. dollars were favorably impacted as a result of the weakening U.S. dollar relative to foreign currencies, as compared to 2024.

Previous wording

Packaging's selling, general and administrative expenses increased $7.7 million to $56.4 million, or 11.0% of sales, in 2024, as compared to $48.8 million, or 10.5% of sales, in 2023, primarily due to $4.7 million higher information technology costs allocated from Corporate, higher employee-related costs and higher professional fees.

Current wording

Packaging's selling, general and administrative expenses increased $2.4 million to $58.8 million, or 11.0% of sales, in 2025, as compared to $56.4 million, or 11.0% of sales, in 2024, primarily due to higher employee-related costs.

Previous wording

Operating profit (loss) within Specialty Products decreased $38.4 million to an operating loss of $2.0 million, or 1.7% of sales, in 2024, as compared to an operating profit of $36.4 million, or 19.3% of sales, in 2023, primarily due to lower sales levels, which resulted in significantly less favorable absorption of fixed costs, and accelerated depreciation charges for certain machinery and equipment.

Current wording

Operating profit (loss) within Specialty Products increased $6.2 million to an operating profit of $4.2 million, or 3.8% of sales, in 2025, as compared to an operating loss of $2.0 million, or 1.7% of sales, in 2024, primarily due to the year-over-year impact from $8.2 million of accelerated depreciation charges in 2024 for certain machinery and equipment in our cylinder business that did not repeat in 2025. In addition, operating profit increased due to increased sales of steel cylinders and as a result of structural cost reductions made within our cylinder business. These increases were partially offset by the $3.4 million of 2024 operating profit generated by the Arrow Engine business, which was sold in January 2025.

Previous wording

The following "Results of Operations Year Ended December 31, 2024 Compared with Year Ended December 31, 2023" section presents an analysis of our consolidated operating results displayed in the Consolidated Statement of Income. A discussion regarding our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission on February 29, 2024.

Current wording

The following "Results of Operations Year Ended December 31, 2024 Compared with Year Ended December 31, 2023" section presents an analysis of our consolidated operating results displayed in the Consolidated Statement of Income for those areas that have changed as a result of accounting for our Aerospace segment as a discontinued operation. A discussion regarding our results of operations for our Packaging and Specialty Products segments for the year ended December 31, 2024 compared to the year ended December 31, 2023, which did not change, can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the Securities and Exchange Commission on February 27, 2025.

Previous wording

Overall, net sales increased $31.5 million, or 3.5%, to $925.0 million in 2024, as compared to $893.6 million in 2023. Acquisition-related sales growth was $15.7 million, comprised of $2.8 million from our February 2023 acquisition of Aarts and $12.9 million from our April 2023 acquisition of Weldmac. Organic sales, excluding the impact of currency exchange and acquisitions, increased $17.9 million, or 2.0%, driven by organic sales increases of 10.3% and 16.6% within our Packaging and Aerospace segments, respectively, due to end market demand improvements and growth initiatives. These increases were partially offset by a 37.2% sales decrease in our Specialty Products segment due to lower market demand. The increase in net sales was also offset by $2.0 million due to currency exchange, as our reported results in U.S. dollars were unfavorably impacted as a result of the strengthening U.S. dollar relative to foreign currencies.

Current wording

Overall, net sales decreased $21.4 million, or 3.3%, to $630.8 million in 2024, as compared to $652.2 million in 2023. Acquisition-related sales growth was $2.8 million, from our February 2023 acquisition of Aarts. Organic sales, excluding the impact of currency exchange and aquisition, decreased $22.1 million, or 3.4%, driven by an organic sales decrease of 37.2% within our Specialty segment, due to lower market demand, partially offset by an organic sales increase of 10.3% within our Packaging segment due to end market demand improvements and growth initiatives. The increase in net sales was also offset by $2.0 million due to currency exchange, as our reported results in U.S. dollars were unfavorably impacted as a result of the strengthening U.S. dollar relative to foreign currencies.

Previous wording

Gross profit margin (gross profit as a percentage of sales) approximated 21.6% and 22.5% in 2024 and 2023, respectively. Gross profit margin decreased due to reduced sales, significantly less favorable absorption of fixed costs, and $8.2 million of accelerated depreciation charges for certain machinery and equipment within our Specialty Products segment as well as increased input costs, the impact of a $2.6 million commercial settlement in 2023 that did not repeat in 2024, and higher production costs, which started to abate in fourth quarter 2024, related to demand reversion above peak capacity for certain product lines in our Packaging segment. Also contributing to the decrease in gross profit were increased costs and manufacturing inefficiencies resulting from labor union strikes within our Aerospace segment. The decrease in gross profit was partially offset by higher sales levels and related improved fixed cost absorption and the impact of a charge related to purchase accounting in 2023 that did not repeat within our Packaging and Aerospace segments. Additionally, gross margin was favorably impacted by reduced material availability constraints, a more favorable product sales mix, and commercial recoveries within our Aerospace segment, and the lower year-over-year impact of realignment costs within our Packaging segment.

Current wording

Gross profit margin (gross profit as a percentage of sales) approximated 20.5% and 23.5% in 2024 and 2023, respectively. Gross profit margin decreased due to reduced sales, significantly less favorable absorption of fixed costs, and $8.2 million of accelerated depreciation charges for certain machinery and equipment within our Specialty Products segment as well as increased input costs, the impact of a $2.6 million commercial settlement in 2023 that did not repeat in 2024, and higher production costs, which started to abate in fourth quarter 2024, related to demand reversion above peak capacity for certain product lines in our Packaging segment. The decrease in gross profit was partially offset by higher sales levels and related improved fixed cost absorption, the impact of a charge related to purchase accounting in 2023 that did not repeat in 2024, and the favorable impact of lower year-over-year realignment costs all within our Packaging segment.

Previous wording

Operating profit margin (operating profit as a percentage of sales) approximated 5.1% and 7.3% in 2024 and 2023, respectively. Operating profit decreased $18.3 million, to $47.2 million in 2024, as compared to $65.4 million in 2023, primarily due to decreased sales, significantly less favorable absorption of fixed costs and accelerated depreciation charges for certain machinery and equipment within our Specialty Products segment, a $5.5 million pre-tax charge related to updating our asbestos studies, and $3.6 million of pre-tax charges related to our environmental remediation obligations. Additionally, operating profit decreased due to increased input costs and higher production costs, which started to abate in fourth quarter 2024, related to high demand for certain dispensing products within our Packaging segment, as well as increased costs and manufacturing inefficiencies resulting from the labor union strike within our Aerospace segment. These decreases were partially offset by higher sales levels and related improved fixed cost absorption and the impact of a charge related to purchase accounting in 2023 that did not repeat within our Packaging and Aerospace segments. Operating profit was favorably impacted by lower realignment costs and the impact of $1.0 million higher net gains on sales of non-core properties within the Packaging segment, as well as reduced material availability constraints, a more favorable product sales mix, and commercial recoveries within the Aerospace segment.

Current wording

Operating profit margin (operating profit as a percentage of sales) approximated 2.4% and 7.8% in 2024 and 2023, respectively. Operating profit decreased $35.5 million, to $15.2 million in 2024, as compared to an operating profit of $50.7 million in 2023, primarily due to decreased sales, significantly less favorable absorption of fixed costs and accelerated depreciation charges for certain machinery and equipment within our Specialty Products segment, a $5.5 million pre-tax charge related to updating our asbestos studies, and $3.2 million of pre-tax charges related to our environmental remediation obligations. Additionally, operating profit decreased due to increased input costs and higher production costs, which started to abate in fourth quarter 2024, related to high demand for certain dispensing products within our Packaging segment. These decreases were partially offset by higher sales levels and related improved fixed cost absorption, the impact of a charge related to purchase accounting in 2023 that did not repeat, lower realignment costs, and the impact of $1.0 million of higher net gains on sales of non-core properties all within the Packaging segment.

Previous wording

Other income increased $1.3 million to $2.4 million in 2024, from $1.1 million in 2023, primary due to the $2.2 million reversal of the Weldmac contingent consideration liability in 2024 and by a non-cash settlement charge for our Canadian defined benefit obligations during 2023, partially offset by increased foreign translation losses.

Current wording

Other income, net decreased $0.9 million to $0.2 million in 2024, from $1.1 million in 2023, primarily due to increased foreign translation losses, which was partially offset by a non-cash settlement charge for our Canadian defined benefit obligations during 2023.

Previous wording

The effective income tax rate for 2024 was 19.3%, compared to 20.2% for 2023. We recorded income tax expense of $5.8 million in 2024, as compared to $10.2 million in 2023. During 2024, we reported domestic and foreign pre-tax income of $3.3 million and $26.7 million, respectively, as compared to domestic and foreign pre-tax income of $20.7 million and $29.9 million, respectively, in 2023. The rate for 2024 is lower primarily as a result of a change in the mix of domestic and foreign pre-tax results.

Current wording

Income tax (benefit) expense decreased $8.5 million, to $2.2 million of income tax benefit for 2024, as compared to $6.3 million of income tax expense in 2023. The effective income tax rate for 2024 was 53.3%, compared to 17.6% for 2023. During 2024, we reported domestic and foreign pre-tax (loss) income of $(31.2) million and $27.0 million, respectively, as compared to domestic and foreign pre-tax income of $3.9 million and $32.0 million, respectively, in 2023. The rate for 2024 is higher primarily as a result of the overall pre-tax loss in 2024 and a change in the mix of domestic and foreign pre-tax results.

Previous wording

Net income decreased $16.1 million to $24.3 million in 2024, compared to $40.4 million in 2023. This decrease was primarily a result of a decrease in operating profit of $18.3 million and a $3.6 million increase in interest expense, partially offset by a decrease in income tax expense of $4.4 million and a $1.3 million increase in other income.

Current wording

Income from continuing operations decreased $31.5 million to $2.0 million of net loss in 2024, from $29.5 million of net income in 2023. The decrease was primarily the result of a decrease in operating profit of $35.5 million, a $3.6 million increase in interest expense, as well as a $0.9 million decrease in other income, partially offset by a decrease in income tax expense of $8.5 million.

Previous wording

Corporate expenses increased $6.1 million to $52.7 million in 2024, from $46.6 million in 2023, primarily due to a $5.5 million pre-tax charge related to updating our asbestos studies in 2024, $3.6 million of pre-tax charges related to our environment remediation obligations and $1.3 million of higher professional costs associated with business acquisition, diligence and transaction related activity. These increases were partially offset by a $2.7 million decrease in non-cash stock compensation due to expected attainment of existing awards and a $1.3 million decrease in technology costs, as $5.3 million of higher costs associated with upgrades of certain of our information technology applications were more than offset by $6.6 million of technology costs allocated to our segments that was not allocated in 2023.

Current wording

Corporate expenses included in operating profit increased $5.1 million to $51.0 million in 2024, from $45.9 million in 2023, primarily due to a $5.5 million pre-tax charge related to updating our asbestos studies in 2024, $3.2 million of pre-tax charges related to our environment remediation obligations and $1.3 million of higher professional costs associated with business acquisition, diligence and transaction related activity. These increases were partially offset by a $3.3 million decrease in non-cash stock compensation due to expected attainment of existing awards and a $1.3 million decrease in technology costs, as $5.3 million of higher costs associated with upgrades of certain of our information technology applications were more than offset by $6.6 million of technology costs allocated to our segments that was not allocated in 2023.

Previous wording

Gross profit within Aerospace increased $21.9 million to $69.9 million, or 23.8% of sales, in 2024, from $48.0 million, or 19.9% of sales, in 2023. Gross profit increased primarily due to higher sales levels and resulting improved fixed cost absorption, reduced material availability constraints, a more favorable product sales mix, favorable commercial recoveries, and a $2.4 million purchase accounting charge related to the step-up of inventory to fair value in 2023 that did not repeat. These increases were partially offset by increased costs and manufacturing inefficiencies resulting from the labor union strike.

Current wording

Gross profit within Aerospace increased $21.9 million to $69.9 million, or 23.8% of sales, in 2024, as compared to $48.0 million, or 19.9% of sales, in 2023. Gross profit increased primarily due to higher sales levels and resulting improved fixed cost absorption, reduced material availability constraints, a more favorable product sales mix, favorable commercial recoveries, and a $2.4 million purchase accounting charge related to the step-up of inventory to fair value in 2023 that did not repeat. These increases were partially offset by increased costs and manufacturing inefficiencies resulting from the labor union strike.

Previous wording

Selling, general and administrative expenses increased $4.8 million to $36.2 million, or 12.3% of sales, in 2024, as compared to $31.4 million, or 13.0% of sales, in 2023, primarily due to higher employee-related costs, higher information technology costs,$1.8 million of increased costs related to the labor union strike, and higher ongoing selling, general and administrative costs associated with our acquisition of Weldmac. These increases were partially offset by lower legal costs and lower intangible asset amortization expense due to certain assets becoming fully amortized.

Current wording

Selling, general and administrative expenses within Aerospace increased $5.8 million to $37.9 million, or 12.9% of sales, in 2024, as compared to $32.1 million, or 13.3% of sales, in 2023, primarily due to higher employee-related costs, higher information technology costs, $1.8 million of increased costs related to the labor union strike, and higher ongoing selling, general and administrative costs associated with our acquisition of Weldmac. These increases were partially offset by lower legal costs and lower intangible asset amortization expense due to certain assets becoming fully amortized. Additionally, costs directly attributable to Aerospace and allocated to discontinued operations increased $1.0 million to $1.7 million in 2024, as compared to $0.7 million in 2023 primarily due to additional non-cash stock compensation expense in 2024.

Previous wording

Operating profit within Aerospace increased $18.2 million to $33.8 million, or 11.5% of sales, in 2024, as compared to $15.5 million, or 6.4% of sales, in 2023, primarily due to the impact of higher sales levels, improved fixed cost absorption, reduced material availability production constraints, a more favorable product sales mix, commercial recoveries, a purchase accounting adjustment related to Weldmac's inventory step-up to fair value in 2023 that did not repeat, and a $1.1 million indefinite-lived intangible asset impairment charge in 2023 that did not repeat. These increases were partially offset by higher selling, general and administrative expenses and increased costs and manufacturing inefficiencies related to the strike.

Current wording

Operating profit within Aerospace increased $17.2 million to $32.0 million, or 10.9% of sales, in 2024, as compared to $14.8 million, or 6.1% of sales, in 2023, primarily due to the impact of higher sales levels, improved fixed cost absorption, reduced material availability production constraints, a more favorable product sales mix, commercial recoveries, a purchase accounting adjustment related to Weldmac's inventory step-up to fair value in 2023 that did not repeat, and a $1.1 million indefinite-lived intangible asset impairment charge in 2023 that did not repeat. These increases were partially offset by higher selling, general and administrative expenses and increased costs and manufacturing inefficiencies related to the strike.

Previous wording

Cash flows provided by operating activities in 2024 were $63.8 million, as compared to $88.2 million in 2023. Significant changes in cash flows provided by operating activities and the reasons for such changes are as follows:

Current wording

Cash flows provided by operating activities in 2025 were $117.5 million, as compared to $63.8 million in 2024. Significant changes in cash flows provided by operating activities and the reasons for such changes are as follows:

Previous wording

•In 2024, the Company generated $107.3 million in cash flows, based on the reported net income of $24.3 million and after considering the effects of non-cash items related to impairment of indefinite-lived intangible assets, depreciation, amortization of intangible assets and debt issuance costs, (gain) loss on dispositions of assets, changes in deferred income taxes, stock-based compensation, provision for losses on accounts receivable, change in asbestos and environmental liability estimates and other operating activities. In 2023, the Company generated $110.5 million in cash flows based on the reported net income of $40.4 million and after considering the effects of similar non-cash items.

Current wording

•In 2025, the Company generated $118.3 million in cash flows, based on the reported net income of $120.1 million, which includes $72.3 million income from continuing operations and $47.8 million income from discontinued operations, and after considering the effects of non-cash items related to depreciation, amortization of intangible assets and debt issuance costs, (gain) loss on dispositions of assets, changes in deferred income taxes, stock-based compensation, provision for losses on accounts receivable, change in asbestos and environmental liability estimates and other operating activities. In 2024, the Company generated $107.3 million in cash flows based on the reported net income of $24.3 million, which includes a $2.0 million loss from continuing operations and $26.2 million income from discontinued operations, and after considering the effects of similar non-cash items and impairment of indefinite-lived intangible assets.

Previous wording

•Increases in accounts receivable resulted in a use of cash of $20.5 million and $5.5 million in 2024 and 2023, respectively. The increased use of cash for 2024 and 2023 is due primarily to the timing of sales and related collection of cash during the periods. Days sales outstanding of receivables increased by two days in 2024 and six days in 2023.

Current wording

•Decreases in accounts receivable resulted in a source of cash of $1.8 million in 2025, while an increase in accounts receivable resulted in a use of cash of $20.5 million in 2024. Changes in our accounts receivable in 2025 and 2024 are due primarily to the timing of sales and related collection of cash during the periods. Days sales outstanding of receivables decreased by five days in 2025 and increased by two days in 2024.

Previous wording

•We increased our investment in inventory by $21.2 million and $7.1 million in 2024 and 2023, respectively. Our days sales in inventory decreased by four days in 2024, primarily as a result of moderating inventory levels with higher sales levels within our Packaging and Aerospace segments. Our days sales in inventory increased by eleven days in 2023, primarily as a result of investing in certain inventories in our Aerospace segment as a result of increased customer demand.

Current wording

•We increased our investment in inventory by $4.3 million and $21.2 million in 2025 and 2024, respectively. Our days sales in inventory increased by two days in 2025, primarily as a result of investing in certain inventories as a result of increased customer demand. Our days sales in inventory decreased by four days in 2024, primarily as a result of moderating inventory levels with higher sales levels within our Packaging and Aerospace segments.

Previous wording

•Increases in prepaid expenses and other assets resulted in a use of cash of $2.3 million in 2024, while decreases in prepaid expenses and other assets resulted in a source of cash of $4.8 million in 2023. The changes in 2024 and 2023 are primarily as a result of the timing of payments made for income taxes and certain operating expenses.

Current wording

•Decreases in prepaid expenses and other assets resulted in a source of cash of $4.1 million in 2025, while increases in prepaid expenses and other assets resulted in a use of cash of $2.3 million in 2024. The changes in 2025 and 2024 are primarily as a result of the timing of payments made for income taxes and certain operating expenses.

Previous wording

•Increases in accounts payable and accrued liabilities resulted in a source of cash of $0.6 million in 2024, as compared to a use of cash of $14.5 million in 2023. Our days accounts payable on hand decreased by six day through 2024 and increased by one day through 2023. Our days accounts payable on hand fluctuate primarily as a result of the timing of payments made to suppliers and the mix of vendors and related terms.

Current wording

•Decreases in accounts payable and accrued liabilities resulted in a use of cash of $2.4 million in 2025, as compared to a source of cash of $0.6 million in 2024. Our days accounts payable on hand decreased by three days through 2025 and decreased by six days through 2024. Our days accounts payable on hand fluctuate primarily as a result of the timing of payments made to suppliers and the mix of vendors and related terms.

Previous wording

Net cash used for investing activities was $47.0 million and $134.4 million in 2024 and 2023, respectively. During 2024, we invested $51.0 million in capital expenditures as we continued our investment in growth, capacity and productivity-related capital projects. We also received proceeds of $4.0 million from the disposition of property and equipment. During 2023, we paid $77.3 million, net of cash acquired, to acquire Aarts and Weldmac, invested $54.2 million in capital expenditures, made a payment of $3.4 million related to the expiration of one of our cross-currency swap agreements, and received proceeds of $0.5 million from the disposition of property and equipment.

Current wording

Net cash used for investing activities was $64.1 million and $47.0 million in 2025 and 2024, respectively. During 2025, we invested $48.4 million in capital expenditures as we continued our investment in growth, capacity and productivity-related capital projects. During 2025, we paid $37.7 million, net of cash acquired, to acquire the aerospace business of GMT Gummi-Metall-Technik GmbH. We also received proceeds of $22.0 million from the sale of our Arrow Engine business and disposition of property and equipment. During 2024, we invested $51.0 million in capital expenditures and received proceeds of $4.0 million from the disposition of property and equipment.

Previous wording

Net cash used for financing activities was $28.6 million and $30.9 million in 2024 and 2023, respectively. During 2024, we received net proceeds of $1.4 million from borrowings on our revolving credit facilities, purchased $19.3 million of outstanding common stock, used a net cash amount of $1.8 million related to our stock compensation arrangements, paid dividends of $6.6 million, and paid $2.3 million related to other financing activities, which includes $2.25 million of cash paid as final contingent consideration for the Weldmac acquisition. Our reported net proceeds from borrowings on our revolving credit facilities considers the impact of foreign currency translation. During 2023, we received net proceeds of $0.6 million from borrowings on our revolving credit facilities, purchased $18.8 million of outstanding common stock, used a net cash amount of $2.7 million related to our stock compensation arrangements, paid dividends of $6.7 million, and paid $3.3 million related to liabilities assumed in our acquisition of Aarts.

Current wording

Net cash used for financing activities was $46.5 million and $28.6 million in 2025 and 2024, respectively. During 2025, we received net proceeds of $66.5 million from borrowings on our revolving credit facilities, paid $1.3 million for debt financing fees, purchased $103.3 million of outstanding common stock, used a net cash amount of $2.0 million related to our stock compensation arrangements, paid dividends of $6.6 million, and received $0.3 million related to other financing activities. Our reported net proceeds from borrowings on our revolving credit facilities considers the impact of foreign currency translation. During 2024, we received net proceeds of $1.4 million from borrowings on our revolving credit facilities, purchased $19.3 million of outstanding common stock, used a net cash amount of $1.8 million related to our stock compensation arrangements, paid dividends of $6.6 million, and paid $2.3 million related to other financing activities, which included $2.25 million of cash paid as final contingent consideration for our acquisition of the Weldmac Manufacturing Company.

Previous wording

The $400.0 million aggregate principal amount of our senior notes due 2029 ("Senior Notes") accrues interest at a rate of 4.125% per annum, payable semi-annually in arrears on April 15 and October 15. The payment of principal and interest is jointly and severally guaranteed, on a senior unsecured basis by certain named subsidiaries of the Company. The Senior Notes arepari passu in right of payment with all existing and future senior indebtedness and subordinated to all existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness. In 2024, our consolidated subsidiaries that do not guarantee the Senior Notes represented 30% of the total of guarantor and non-guarantor net sales, treating each as a consolidated group and excluding intercompany transactions between guarantor and non-guarantor subsidiaries. In addition, our non-guarantor subsidiaries represented 37% and 15% of the total guarantor and non-guarantor assets and liabilities, respectively, as of December 31, 2024, treating the guarantor and non-guarantor subsidiaries each as a consolidated group.

Current wording

The $400.0 million aggregate principal amount of our senior notes due 2029 ("Senior Notes") accrues interest at a rate of 4.125% per annum, payable semi-annually in arrears on April 15 and October 15. The payment of principal and interest is jointly and severally guaranteed, on a senior unsecured basis by certain named subsidiaries of the Company. The Senior Notes arepari passu in right of payment with all existing and future senior indebtedness and subordinated to all existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness. In 2025, our consolidated subsidiaries that do not guarantee the Senior Notes represented 30% of the total of guarantor and non-guarantor net sales, treating each as a consolidated group and excluding intercompany transactions between guarantor and non-guarantor subsidiaries. In addition, our non-guarantor subsidiaries represented 25% and 13% of the total guarantor and non-guarantor assets and liabilities, respectively, as of December 31, 2025, treating the guarantor and non-guarantor subsidiaries each as a consolidated group.

Previous wording

We are party to a credit agreement ("Credit Agreement"), consisting of a $300.0 million senior secured revolving credit facility, which permits borrowings denominated in specific foreign currencies, subject to a $125.0 million sub limit, maturing on March 29, 2026.

Current wording

We are party to a credit agreement ("Credit Agreement"), consisting of a $250.0 million senior secured revolving credit facility, which permits borrowings denominated in specific foreign currencies, subject to a $125.0 million sub limit, maturing on March 31, 2030.

Previous wording

In April 2023, we amended the Credit Agreement to replace LIBOR. As of December 31, 2024, monthly borrowings under the Credit Agreement are subject to benchmark interest rates that are based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average and Euro borrowings subject to the Euro InterBank Offered Rate, both plus a spread of 1.75%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate plus a spread of 1.85%. The interest rate spread is based upon the leverage ratio, as defined, as of the most recent determination date.

Current wording

As of December 31, 2025, monthly borrowings under the Credit Agreement are subject to benchmark interest rates determined based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average, Euro borrowings subject to the Euro InterBank Offered Rate and U.S. dollar borrowings subject to the Secured Overnight Financing Rate, each plus a spread that ranges from 1.375% to 2.00% based upon the leverage ratio, as defined, as of the most recent determination date.