MINERALS TECHNOLOGIES INC

Note 1. Basis of Presentation and Summary of Significant Accounting Policies

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by management of Minerals Technologies Inc. (together with its subsidiaries, the “Company,” “MTI,” “we,” “us,” or“our”) in accordance with the rules and regulations of the United States Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. Therefore, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. In the opinion of management, all adjustments, consisting solely of normal recurring adjustments necessary for a fair presentation of the financial information for the periods indicated, have been included. The results for the three and nine-month periods ended October 4, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.

Company Operations

The Company is a global, technology-driven specialty minerals company that develops, produces, and markets a wide range of minerals and mineral-based products and services. We utilize global mineral reserves with our core technologies and applications to deliver innovative solutions for products that are part of everyday life. We serve customers in consumer and industrial markets worldwide.

The Company hastwo reportable segments: Consumer & Specialties and Engineered Solutions.

• The Consumer & Specialties segment serves consumer end markets directly with mineral-to-market finished products and also provides specialty mineral-based solutions and technologies that are an essential component of our customers' finished products.

• The Engineered Solutions segment serves industrial end markets with engineered systems, mineral blends, and technologies that are designed to improve our customers' manufacturing processes and projects.

Use of Estimates

The Company employs accounting policies that are in accordance with U.S. generally accepted accounting principles and require management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenue and expenses during the reported period. Significant estimates include those related to revenue recognition, valuation of long-lived assets, goodwill and other intangible assets, certain pension plan assumptions, valuation of deferred income tax assets, provision for credit losses, and legal and environmental liabilities. Actual results could differ from those estimates.

Reclassifications

Certain reclassifications have been made to the prior period financial information to conform to the presentation used in the Condensed Consolidated Financial Statements for the three and nine-month periods ended October 4, 2026.

Recently Issued Accounting Standards

Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASUs) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations.

Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” that requires entities to disclose additional information in the notes to the financial statements about prescribed categories underlying any relevant income statement expense caption. The new standard is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The adoption of this standard is not expected to have a material impact on the Company’s Consolidated Financial Statements but will result in disaggregation of the Company’s income statement expenses.

Note 2. Revenue from Contracts with Customers

The following table disaggregates our revenue by major source (product line) for the three and nine-month periods ended October 4, 2026 and September 28, 2025:

Note 3. Earnings (loss) per Share (EPS)

Basic earnings (loss) per share are based upon the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share are based upon the weighted average number of common shares outstanding during the period, assuming the issuance of common shares for all potentially dilutive common shares outstanding.

The following table sets forth the computation of basic and diluted earnings (loss) per share:

Of the options outstanding of 1,525,140 and 1,582,083 for the three and nine-month periods ended October 4, 2026 and September 28, 2025, respectively, options to purchase 853,461 shares and 1,209,857 shares of common stock for the three and nine-month periods ended October 4, 2026 and September 28, 2025, respectively, were not included in the computation of diluted earnings (loss) per share because they were anti-dilutive, as the exercise prices of the options were greater than the average market price of the common shares. Due to our net loss for the nine-month periods ended October 4, 2026 and September 28, 2025, all options to purchase shares were anti-dilutive and were excluded for these periods.

Note 4. Restructuring and Other Items

In the second quarter of 2025, the Company recorded a $5.8 million charge in restructuring and other items for the write-down of assets and other charges relating to the consolidation oftwo facilities.

In the first quarter of 2025, the Company initiated a cost savings program, primarily through workforce reductions, and recorded a charge of $5.5 million for severance and other related costs associated with this program.

The following table outlines the amount of restructuring charges recorded within the Condensed Consolidated Statements of Income (Loss) and the segment they relate to:

At October 4, 2026, the Company had $3.3 million included within other current liabilities in the Condensed Consolidated Balance Sheet for cash expenditures needed to satisfy remaining obligations under workforce reduction initiatives. The Company expects to pay these amounts within the next twelve months.

The following table is a reconciliation of our restructuring liability balance relating to workforce reductions as of October 4, 2026:

Note 5. Income Taxes

Provision for taxes was $12.2 million and $13.5 million for the three-month periods ended October 4, 2026 and September 28, 2025, respectively. Benefit for taxes was $24.1 million and $4.7 million for the nine-month periods ended October 4, 2026 and September 28, 2025, respectively, primarily attributable to the litigation accrual. The effective tax rate was 23.0% for the three-month period ended October 4, 2026, as compared with 23.9% for the three-month period ended September 28, 2025.

As of October 4, 2026, the Company had approximately $6.2 million of total unrecognized income tax benefits. Included in this amount were a total of $4.6 million of unrecognized income tax benefits that, if recognized, would affect the Company’s effective tax rate. While it is expected that the amount of unrecognized tax benefits will change in the next 12 months, the Company does not expect the change to have a significant impact on the results of operations or the financial position of the Company.

The Company’s accounting policy is to recognize interest and penalties accrued, relating to unrecognized income tax or benefit as part of its provision for income taxes. The Company recorded net immaterial additions during the three-month period ended October 4, 2026 and had an accrued balance of $0.8 million of interest and penalties as of October 4, 2026.

The Company operates in multiple taxing jurisdictions, both within and outside the U.S. In certain situations, a taxing authority may challenge positions that the Company has adopted in its income tax filings. The Company, with a few exceptions (none of which are material), is no longer subject to U.S. federal, state, local, and international income tax examinations by tax authorities for years prior to 2017.

On July 4, 2025, the One Big Beautiful Bill Act was signed into law in the U.S. It contains a broad range of tax reform provisions affecting businesses. The Company evaluated the full effects of the legislation on our annual effective tax rate and cash tax position, and it did not have a material impact on our Consolidated Financial Statements.

In December 2021, the Organization for Economic Co-operation and Development (“OECD”) released the Pillar Two Model Rules which aim to reform international corporate taxation rules, including the implementation of a global minimum tax rate. The Company began implementation of the Pillar Two Model Rules in the first quarter of 2024. The Company continues to assess the effect of the Pillar Two Model Rules in all jurisdictions and does not expect that Pillar Two will have a material impact on its Consolidated Financial Statements.

Note 6. Inventories

The following is a summary of inventories by major category:

Note 7. Goodwill and Other Intangible Assets

Goodwill and other intangible assets with indefinite lives are not amortized, but instead are assessed for impairment, at least annually. The carrying amount of goodwill was $915.5 million and $915.9 million as of October 4, 2026 and December 31, 2025, respectively. The net change in goodwill from December 31, 2025 to October 4, 2026 is attributable to the effects of foreign exchange.

Acquired intangible assets subject to amortization as of October 4, 2026 and December 31, 2025 were as follows:

The weighted average amortization period for acquired intangible assets subject to amortization is approximately 29 years. Estimated amortization expense is $2.9 million for the remainder of 2026, $46.0 million for 2027–2030 and $150.5 million thereafter.

Note 8. Derivative Financial Instruments

As a multinational corporation with operations throughout the world, the Company is exposed to certain market risks. The Company uses a variety of practices to manage these market risks, including, when considered appropriate, derivative financial instruments. The Company’s objective is to offset gains and losses resulting from interest rate and foreign currency exposures with gains and losses on the derivative contracts used to hedge them. The Company uses derivative financial instruments only for risk management and not for trading or speculative purposes.

By using derivative financial instruments to hedge exposures to changes in interest rates and foreign currencies, the Company exposes itself to credit risk and market risk. Credit risk is the risk that the counterparty will fail to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative contract is negative, the Company owes the counterparty, and therefore, it does not face any credit risk. The Company minimizes the credit risk in derivative instruments by entering into transactions with major financial institutions.

Market risk is the adverse effect on the value of a financial instrument that results from a change in interest rates, currency exchange rates, or commodity prices. The market risk associated with interest rate and forward exchange contracts is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.

Cash Flow Hedges

For derivative instruments that are designated and qualify as cash flow hedges, the Company records the effective portion of the gain or loss in accumulated other comprehensive income (loss) as a separate component of shareholders’ equity. The Company subsequently reclassifies the effective portion of gain or loss into earnings in the period during which the hedged transaction is recognized in earnings.

The Company utilizes interest rate swaps to limit exposure to market fluctuations on floating-rate debt. In the second quarter of 2023, the Company entered into a floating to fixed interest rate swap for a notional amount of $150 million. This interest rate swap matured in May 2026. In the second quarter of 2026, the Company entered into a new floating to fixed interest rate swap for a notional amount of $150 million. The fair value of this swap is an asset of $3.8 million at October 4, 2026 and is recorded in other assets and deferred charges on the Condensed Consolidated Balance Sheet. This interest rate swap is designated as a cash flow hedge. As a result, the gains and losses associated with this interest rate swap are recorded in accumulated other comprehensive income (loss).

Assets and liabilities measured at fair value are based on one or more of three valuation techniques. The three valuation techniques are as follows:

• Market approach - prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

• Cost approach - amount that would be required to replace the service capacity of an asset or replacement cost.

• Income approach - techniques to convert future amounts to a single present amount based on market expectations, including present value techniques, option-pricing and other models.

The Company primarily applies the income approach for interest rate derivatives for recurring fair value measurements and attempts to utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.

The fair value of our interest rate swap contract is determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets and is categorized as Level 2.

Note 9. Long-Term Debt and Commitments

The following is a summary of long-term debt:

On November 26, 2024, the Company entered into a Refinancing Facility Agreement and Incremental Facility Amendment (the “Amendment”) to amend the Company’s previous credit agreement (the “Previous Credit Agreement; the previous credit agreement, as amended by the Amendment, being the “Amended Credit Agreement”).

The Amendment provides for, among other things, a new senior secured revolving credit facility with aggregate commitments of $400 million (the “Revolving Facility”), a portion of which may be used for the issuance of letters of credit and swingline loans, and a new senior secured term loan facility with aggregate commitments of $575 million (the “Term Loan Facility” and, together with the Revolving Facility, the “Senior Secured Credit Facilities”). The Revolving Facility and the Term Loan Facility replace the facilities under the Previous Credit Agreement, which provided for, among other things, a $550 million senior secured term loan facility and a $300 million senior secured revolving credit facility. The maturity date for loans and commitments under the Revolving Facility is November 26, 2029, and the maturity date for loans under the Term Loan Facility is November 26, 2031; provided that the maturity dates of the Revolving Facility and the Term Loan Facility will be adjusted to the date that is 91 days prior to the stated maturity date of the Company’s 5.0% Senior Notes due 2028 (the “Notes”) unless, prior to the date that is 91 days prior to the stated maturity date of the Notes, all amounts in excess of $50 million of the Notes have been either (a) refinanced with indebtedness permitted under the Amended Credit Agreement maturing later than 90 days after the scheduled maturity date of the Revolving Facility or of the Term Loan Facility, as applicable, or (b) repaid, discharged or repaid (other than with the proceeds of any indebtedness maturing earlier than 91 days after the scheduled maturity date of the Revolving Facility or of the Term Loan Facility, as applicable). Loans under the Term Loan Facility amortize at a rate equal to 1.00% per annum, payable in equal quarterly installments, and were issued with original issue discount at 99.875% of par.

Loans under the Revolving Facility will bear interest at a rate equal to (a) for loans denominated in U.S. dollars, at the election of the Company, Term SOFR plus an applicable margin equal to 1.375% per annum or a base rate plus an applicable margin equal to 0.375% per annum, (b) for loans denominated in Euros, adjusted EURIBOR plus an applicable margin equal to 1.375% per annum and (c) for loans denominated in Pounds Sterling, SONIA plus an applicable margin equal to 1.375% per annum, subject in each case to (i) an increase of 37.5 basis points in the event that, and for so long as, the Net Leverage Ratio (as defined in the Amended Credit Agreement) is greater than or equal to 3.00 to 1.00 as of the last day of the preceding fiscal quarter, (ii) an increase of 12.5 basis points in the event that, and for so long as, the Net Leverage Ratio is less than 3.00 to 1.00 and greater than or equal to 2.00 to 1.00 as of the last day of the preceding fiscal quarter, and (iii) a decrease of 12.5 basis points in the event that, and for so long as, the Net Leverage Ratio is less than 1.00 to 1.00 as of the last day of the preceding fiscal quarter. Loans under the Term Loan Facility will bear interest at a rate equal to, at the election of the Company, Term SOFR plus an applicable margin equal to 2.00% per annum or a base rate plus an applicable margin equal to 1.00% per annum. The Company will pay certain fees under the Amended Credit Agreement, including (a) a commitment fee of 0.175% per annum on the undrawn portion of the Revolving Facility (subject to a step-ups to 0.300% and 0.250% and a step-down to 0.150% at the same levels described above), (b) a fronting fee of 0.125% per annum on the average daily undrawn amount of, plus unreimbursed amounts in respect of disbursements under, letters of credit issued under the Revolving Facility, and (c) customary annual administration fees. The obligations of the Company under the Senior Secured Credit Facilities are unconditionally guaranteed jointly and severally by, subject to certain exceptions, all material domestic subsidiaries of the Company (the “Guarantors”) and secured, subject to certain exceptions, by a security interest in substantially all of the tangible and intangible assets of the Company and the Guarantors.

On October 13, 2026, the Company entered into a Refinancing Facility Agreement and Incremental Facility Amendment (the “2026 Amendment”) to amend the Amended Credit Agreement (the Amended Credit Agreement, as amended by the 2026 Amendment, the “2026 Amended Credit Agreement”). The 2026 Amendment provides for, among other things, a new senior secured revolving credit facility with aggregate commitments of $500,000,000 (the “2026 Refinancing Revolving Facility”), a portion of which may be used for the issuance of letters of credit and swingline loans. The 2026 Refinancing Revolving Facility replaces the Revolving Facility. The maturity date for loans and commitments under the 2026 Refinancing Revolving Facility is October 13, 2031; provided that the maturity date of the 2026 Refinancing Revolving Facility will be adjusted to the date that is 91 days prior to the stated maturity date of the Term Loan Facility unless, prior to the date that is 91 days prior to the stated maturity date of the Term Loan Facility, all amounts in excess of $50,000,000 of the Term Loan Facility have been either (a) refinanced with indebtedness permitted under the 2026 Amended Credit Agreement maturing later than 90 days after the scheduled maturity date of the Term Loan Facility or (b) discharged or repaid (other than with the proceeds of any indebtedness maturing earlier than 91 days after the scheduled maturity date of the 2026 Refinancing Revolving Facility). The 2026 Amendment does not change any terms of the Term Loan Facility and, except as set forth above, the terms of the 2026 Refinancing Revolving Facility (including interest rates and fees) remain the same as the Revolving Facility.

As of October 4, 2026, there wereno loans and $11.2 million in letters of credit outstanding under the Revolving Facility.

On June 30, 2020, the Company issued $400 million aggregate principal amount of "5% Senior Notes" due 2028 (the "2028 Notes"). The 2028 Notes were issued pursuant to an indenture, dated as of June 30, 2020, between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the “2020 Indenture”). The 2028 Notes bore an interest rate of 5.0% per annum payable semi-annually on January 1 and July 1 of each year, beginning on January 1, 2021. The 2028 Notes were unconditionally guaranteed on a senior unsecured basis by each of the Company’s existing and future wholly owned domestic restricted subsidiaries that is a borrower under or that guarantees the Company’s obligations under its Senior Secured Credit Facilities or that guarantees the Company’s or any of the Company’s wholly owned domestic subsidiaries’ long-term indebtedness in an aggregate amount in excess of $50 million.

On October 13, 2026, the Company completed an offering of $400,000,000 aggregate principal amount of its 7.500% Senior Notes due 2032 (the “2032 Notes”). The Company used the net proceeds of its offering of the 2032 Notes, together with cash on hand, (i) to redeem all of the outstanding 2028 Notes and (ii) to pay transaction fees and expenses related to the offering of the 2032 Notes and the 2026 Amendment . The terms of the 2032 Notes are governed by an indenture dated as of October 13, 2026 (the “2026 Indenture”), among the Company, the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee (the “2026 Trustee”).

The 2032 Notes bear interest at a rate of 7.500% per annum payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2027. The 2032 Notes are guaranteed by the Company’s wholly owned domestic restricted subsidiaries that are obligors or guarantors under its senior secured credit facilities or certain other indebtedness.

At any time and from time to time prior to January 15, 2029, the Company may redeem some or all of the 2032 Notes for cash at a redemption price equal to 100% of their principal amount, plus the “make-whole” premium described in the 2026 Indenture and accrued and unpaid interest, if any, to, but excluding, the applicable redemption date. Beginning on January 15, 2029, the Company may redeem some or all of the 2032 Notes at any time and from time to time at the applicable redemption prices listed in the Indenture, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date. In addition, at any time and from time to time prior to January 15, 2029, the Company may redeem up to 40% of the aggregate principal amount of the 2032 Notes with funds fromone or more equity offerings at a redemption price equal to 107.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date.

If the Company experiences a change of control (as defined in the indenture), the Company is required to offer to repurchase the 2032 Notes at 101% of the principal amount of such Notes, plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase.

The Amended Credit Agreement, and the 2020 Indenture, as well as the 2026 Amended Credit Agreement and the 2026 Indenture, contain certain customary affirmative and negative covenants that limit or restrict the ability of the Company and its restricted subsidiaries to enter into certain transactions or take certain actions, as well as customary events of default. In addition, the Amended Credit Agreement and the 2026 Amended Credit Agreement contain a financial covenant that requires the Company to maintain a maximum Net Leverage Ratio of 4.00 to 1.00 for each four fiscal quarter period (subject to an increase to 5.00 to 1.00 forfour quarters in connection with certain significant acquisitions). The Company was in compliance with all the covenants contained in the Amended Credit Agreement throughout the period covered by this report.

The Company had a committed loan facility in Japan. In the second quarter of 2026, the Company repaid the remaining balance of $0.4 million.

As part of the acquisition of Concept Pet Heimtierprodukte GmbH (“Concept Pet”) in 2022, the Company assumed $1.9 million in long-term debt, recorded at fair value, consisting oftwo term loans, one that matured in 2025 andone that matures in 2027. The outstanding loan has annual payments and carries a variable interest rate. The Company repaid $0.1 million on this loan during the first nine months of 2026.

As of October 4, 2026, the Company had $13.9 million in uncommitted short-term bank credit lines, of which none were in use.

Note 10. Benefit Plans

The Company and its subsidiaries have pension plans covering the majority of its eligible employees on a contributory or non-contributory basis. The Company also provides postretirement health care and life insurance benefits for the majority of its U.S. retired employees. Disclosures for the U.S. plans have been combined with those outside of the U.S., as the international plans do not have significantly different assumptions, and together represent less than 20% of our total benefit obligation.

Components of Net Periodic Benefit Cost (Income)

Amortization amounts of prior service costs and recognized net actuarial losses are recorded, net of tax, as increases to accumulated other comprehensive income.

The Company expects to contribute approximately $10.8 million to its pension plans and $0.1 million to its other postretirement benefit plans in 2026. As of October 4, 2026, $4.8 million has been contributed to the pension plans andno contributions have been made to the other postretirement benefit plans.

Note 11. Comprehensive Income

The following table summarizes the amounts reclassified out of accumulated other comprehensive loss attributable to the Company:

The pre-tax amounts in the table above are included within the components of net periodic pension benefit cost (see Note 10 to the Condensed Consolidated Financial Statements) and the tax amounts are included within the provision (benefit) for taxes on income line within the Condensed Consolidated Statements of Income (Loss).

The major components of accumulated other comprehensive loss, net of related tax, attributable to MTI are as follows:

Note 12. Contingencies

The Company is party to a number of lawsuits arising in the normal course of our business. The Company and certain of the Company’s subsidiaries are among numerous defendants in a number of cases seeking damages for alleged exposure to asbestos-contaminated talc products sold by the Company’s subsidiary BMI Oldco Inc (f/k/a Barretts Minerals Inc.) ("Oldco").

On October 2, 2023 (the “Petition Date”), notwithstanding the Company’s confidence in the safety of Oldco’s talc products, the Company’s subsidiaries, Oldco and Barretts Ventures Texas LLC ("BVT" and, together with Oldco, the “Chapter 11 Debtors”), filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas (the “Chapter 11 Cases”) to address and comprehensively resolve Oldco’s liabilities associated with talc. Minerals Technologies Inc. and the Company’s other subsidiaries were not included in the Chapter 11 filing.

The Chapter 11 Debtors’ stated goal in the Chapter 11 Cases is to confirm a plan of reorganization under Section 524(g) of the U.S. Bankruptcy Code and utilize this provision of the Bankruptcy Code to establish a trust that will address all current and future talc-related claims.

As of October 4, 2026, we had 1,051 open cases related to certain talc products previously sold by Oldco, which is an increase in volume from previous years. The following table details case activity related to talc products previously sold by Oldco:

These claims typically allege various theories of liability, including negligence, gross negligence, and strict liability and seek compensatory and, in some cases, punitive damages, but most of these claims do not provide adequate information to assess their merits, the likelihood that the Company will be found liable, or the magnitude of such liability, if any. We are unable to state an amount or range of amounts claimed in any of these lawsuits because state court pleading practices do not require the plaintiff to identify the amount of the claimed damage. The Company’s position, as stated publicly, is that the talc products sold by Oldco are safe and do not cause cancer.

During the pendency of the Chapter 11 Cases, the Company anticipates that the Chapter 11 Debtors will benefit from the operation of the automatic stay, which stays ongoing litigation in connection with talc-related claims against the Chapter 11 Debtors. In addition, the Bankruptcy Court temporarily enjoined the filing or continued prosecution of all talc-related claims against the Chapter 11 Debtors’ non-debtor affiliates, subject to certain exceptions. Such exceptions consist of claims premised solely on alleged inadequacies in testing of talc sold by Oldco. The Company is vigorously opposing and defending against these claims.

While costs relating to the talc-related cases have increased concurrently with the volume, the majority of these costs have historically been borne by Pfizer Inc. (“Pfizer”) in connection with certain agreements entered into in connection with the Company’s initial public offering in 1992, and as long as the litigation is subject to the stay under the Chapter 11 Cases (subject to certain exceptions), the Company will not be required to make substantial payments in respect thereof. The Company is entitled to indemnification, pursuant to agreement, for liabilities arising from sales prior to the initial public offering. On May 22, 2024, Pfizer filed a motion in the Chapter 11 Cases seeking permission to file a lawsuit against the Company related to the 1992 agreement. That motion has been adjourned, and Pfizer and the Company have agreed to mediate their disputes. The Company continues to receive information from Pfizer with respect to potential costs associated with the defense and/or settlement of talc-related cases that Pfizer alleges are not subject to indemnification. Although the Company believes that the talc products are safe and that claims to the contrary are without merit, the Company and Oldco have opportunistically settled certain talc-related cases not settled by Pfizer. None of such settlements were material to the Company.

In the second quarter of 2024, Oldco sold its talc assets under section 363 of the Bankruptcy Code. In addition, in the second quarter of 2024, the Company entered into a Debtor-in-Possession Credit Agreement with Oldco (the “DIP Credit Agreement”) and recorded a provision for credit loss of $30 million for the maximum principal amount under such Credit Agreement. The Company agreed to amend the DIP Credit Agreement to increase the maximum principal amount under such Credit Agreement by $30 million in the second quarter of 2025 and another $2.6 million in the second quarter of 2026. Proceeds of the sale of Oldco’s talc assets and funds drawn by Oldco under the DIP Credit Agreement have been and will be used to fund the Chapter 11 Cases.

Following the Chapter 11 filing, the activities of the Chapter 11 Debtors are now subject to review and oversight by the bankruptcy court. As a result, the Chapter 11 Debtors were deconsolidated as of the Petition Date, and their assets and liabilities were derecognized from the Company’s consolidated financial statements on a prospective basis.

On June 25, 2024, the committee representing talc claimants (the “Committee”) filed a motion to dismiss the Chapter 11 Cases. The Bankruptcy Court denied that motion on April 29, 2025 and the United States District Court for the Southern District of Texas (the “District Court”) denied the Committee's motion seeking leave to appeal that order on March 23, 2026. On September 14, 2026, the Committee again filed a motion to dismiss the Chapter 11 Cases in the District Court, which the Company has opposed. The District Court proceedings, including as to the motion to dismiss are stayed.

On May 14, 2025, the Bankruptcy Court entered a Report and Recommendation (i) recommending that the District Court determine whether any of the talc sold by Oldco contained sufficient quantity and form of asbestos to cause mesothelioma or other asbestos-related diseases and (ii) abating the Chapter 11 Cases pending a determination by the District Court. On June 22, 2026, the District Court adopted the Bankruptcy Court's recommendation. On September 22, 2026, the Committee filed a petition for a writ of mandamus asking the U.S. Court of Appeals for the Fifth Circuit to direct the District Court to vacate the order adopting the Bankruptcy Court's recommendation. On October 2, 2026, the U.S. Court of Appeals for the Fifth Circuit stayed the District Court proceedings and agreed to hear oral argument on December 1, 2026 regarding the Committee's mandamus petition. The Company supports the path forward recommended by the Bankruptcy Court in its May 14, 2025 Report and Recommendation.

On June 29, 2026, to satisfy a deadline imposed by the Bankruptcy Court, the Company filed a Plan of Reorganization in the Chapter 11 Cases ("the Parent Plan"). The Parent Plan would provide for, among other things:

• The funding of a Talc Personal Injury Trust with $450 million from the Company for the payment of current and future talc-related claims;

• Issuance of a channeling injunction pursuant to section 524(g) of the Bankruptcy Code to address all current and future talc-related claims through the Trust;

• Release of estate claims against the Company; and

• The Company's waiver of more than $100 million in claims against the Chapter 11 Debtors related to pre-petition and post-petition funding.

The Parent Plan is subject in all respects to the resolution of the District Court proceedings, which are currently stayed pending resolution of the Committee's mandamus petition. The Bankruptcy Court proceedings also remain abated.

In the first quarter of 2025, the Company recorded a provision to establish an accrual of $215 million for estimated costs to fund a trust to resolve all current and future talc-related claims as well as fund the Chapter 11 Cases and related litigation costs (including the aforementioned $30 million increase to the maximum principal amount of the DIP Credit Agreement). Concurrent with the filing of the Parent Plan, the Company recorded a charge of $290 million in the second quarter of 2026 to increase the Company's reserve for estimated costs. The parties have not yet reached a final resolution of all matters in the Chapter 11 Cases, and the Company is unable to estimate the possible loss or range of loss beyond the amount accrued.

The Company records accruals for loss contingencies associated with legal matters, including talc-related litigation and the Chapter 11 Cases, when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. Amounts accrued for legal contingencies often result from a complex series of judgments about future events and uncertainties that rely heavily on estimates and assumptions including timing of related payments. The ability to make such estimates and judgments can be affected by various factors, including whether damages sought in the proceedings are unsubstantiated or indeterminate, the stage of the litigation, the factual and legal matters in dispute, the ability to achieve comprehensive settlements, the availability of co-defendants with substantial resources and assets participating in the litigation, and our evaluation of the unique attributes of each claim.

The broader litigation and regulatory environments for talc-related claims continue to evolve. Moreover, although the Chapter 11 Cases are progressing, it is not possible at this time to predict how the U.S. Court of Appeals for the Fifth Circuit and the District Court will rule on the matters before them, the form of any ultimate resolution or when an ultimate resolution might occur. Given the foregoing factors, it is reasonably possible that the Company will incur a loss for liabilities associated with talc claims in excess of the amount accrued. This risk is based on the potential for new talc-related claims that could eventually be asserted together with their associated disposition cost and related legal costs, despite the automatic stay with respect to claims against the Chapter 11 Debtors, taking into account the portion of such hypothetical claims that may be subject to indemnification by Pfizer, as well as the inability to predict the amount that may ultimately be necessary to fully and finally resolve all of the Chapter 11 Debtors’ future talc-related claims in connection with a confirmed Chapter 11 plan of reorganization. In light of the uncertainties involved in such matters, the resolution of, or recognition of additional liabilities in connection with, current or future talc claims could have a material adverse effect on the Company’s results of operations, cash flows, and financial condition.

Note 13. Segment and Related Information

The Company determines its operating segments based on the discrete financial information that is regularly evaluated by its chief operating decision maker, our Chief Executive Officer, in deciding how to allocate resources and in assessing performance. The Company’s operating segments are strategic business units that offer different products and serve different markets. They are managed separately and require different technology and marketing strategies.

The Company hastwo reportable segments: Consumer & Specialties and Engineered Solutions. See Note 1 to the Condensed Consolidated Financial Statements.

The Company evaluates performance based on the operating income of the respective business units. The costs deducted to arrive at operating profit do not include several items, such as net interest or income tax expense. Depreciation expense related to corporate assets is allocated to the business segments and is included in their income from operations. However, such corporate depreciable assets are not included in the segment assets. Intersegment sales and transfers are not significant.

Segment revenues, expenses, operating income, and a reconciliation of the operating segment totals to the applicable line items on the Condensed Consolidated Financial Statements are as follows for the three and nine-month periods ended October 4, 2026 and September 28, 2025:

Segment information is as follows for the three and nine-month periods ended October 4, 2026 and September 28, 2025:

The Company’s segment assets as of October 4, 2026 and December 31, 2025 are as follows:

The Company’s sales by product category are as follows: