Simpson Manufacturing Co., Inc.

Previous wording

•Above market growth relative to U.S. housing starts (exceeding our historical average volume performance in North America of approximately 250 basis points above the housing starts market);

Current wording

•Above market growth relative to the U.S. housing starts (exceeding our historical average volume performance in North America of approximately 250 basis points above the housing starts market);

Previous wording

During the three months ended March 31, 2025, the recent tariff and trade policy actions have not had a significant impact on our results of operations; however, we have experienced increased foreign currency exchange rate volatility, which we attribute, in part, to the rapidly changing global trade environment.

Current wording

During the six months ended June 30, 2025, the recent tariff and trade policy actions have had some impact and will continue to impact our results of operations. We also experienced increased foreign currency exchange rate volatility, which we attribute, in part, to the rapidly changing global trade environment.

Previous wording

As previously announced, we will increase prices as of June 2, 2025 on certain wood connectors, fasteners and mechanical anchors in the U.S. We believe North America net sales could increase in future periods even if demand does not increase. However, increased selling prices are expected to be offset by increased non-material costs including labor, energy, transportation, and equipment. In addition, the announced price increases will partly offset the increased costs related to recently announced tariffs that effect a portion of our fastener and anchors sales.

Current wording

As previously announced, we increased prices as of June 2, 2025 on certain wood connectors, fasteners and mechanical anchors in the U.S. We believe North America net sales could increase in future periods even if demand does not increase. However, increased selling prices are expected to be offset by increased non-material costs including labor, energy, transportation, and equipment incurred over the prior three years. In addition, the announced price increases will partly offset the increased costs related to the initial tariffs that effected a portion of our fastener and anchors sales, while it does not offset tariffs announced after June 2, 2025.

Previous wording

In addition to financial information prepared in accordance with GAAP, we use adjusted EBITDA as a non-GAAP financial measure in evaluating the ongoing operating performance of our business. We define adjusted EBITDA as net income (loss) before income taxes, adjusted to exclude depreciation and amortization, integration, acquisition and restructuring costs, non-qualified deferred compensation adjustments, goodwill impairment, gain on bargain purchase, net loss or gain on disposal of assets, interest income or expense, and foreign exchange and other expense (income). This provides additional insight into the Company’s operating performance in light of the significant levels of growth investment we have made in our operations, the effect depreciation as well as acquisition and integration costs will have on our operating results. We believe this will also provide a better approximation of our cash flows compared to operating income.

Current wording

In addition to financial information prepared in accordance with GAAP, we use adjusted EBITDA as a non-GAAP financial measure in evaluating the ongoing operating performance of our business. We define adjusted EBITDA as net income (loss) before income taxes, adjusted to exclude depreciation and amortization, integration, acquisition and restructuring costs, non-qualified deferred compensation adjustments, goodwill impairment, gain on bargain purchase, net loss or gain on disposal of assets, interest income or expense, and foreign exchange and other expense (income). This provides additional insight into the Company’s operating performance in light of the significant levels of growth investment we have made in our operations, the effect depreciation and acquisition as well as integration costs will have on our operating results. We believe this will also provide a better approximation of our cash flows compared to operating income.

Previous wording

Our business, financial condition, and results of operations depend in large part on the level of U.S. housing starts and residential construction activity. Overall housing starts decreased slightly under the trailing twelve months ending March 31, 2025, compared to the trailing twelve months ending March 31, 2024. Lower housing starts in the U.S. could result in lower demand, which would affect our sales and possibly operating profit.

Current wording

Our business, financial condition, and results of operations depend in large part on the level of U.S. housing starts and residential construction activity. Overall U.S. housing starts decreased under the trailing twelve months ending June 30, 2025, compared to the trailing twelve months ending June 30, 2024. Lower housing starts in the U.S. could result in lower demand, which would affect our sales and possibly operating profit.

Previous wording

We are closely monitoring the recent tariff and trade policy actions taken by the U.S. and foreign governments. As the situation continues to remain fluid due to the rapidly changing global trade environment, we are still evaluating the potential implications of these actions on our business. While we are largely domestically sourced, we continue to monitor macroeconomic trends such as the impact of inflation, the effects of recently implemented tariffs, and the potential imposition of modified or additional tariffs in markets where we and our supplier operate. As a result of the tariff’s announced by the U.S. presidential administration on April 2, 2025, and potential tariff modifications or the imposition of tariffs or export controls by other countries there is significant economic uncertainty. The extent and duration of tariffs and the resulting impact on macroeconomic conditions and on our business are uncertain and may depend on various factors beyond our control. We are closely monitoring the potential for the imposition of new or additional U.S. tariffs on imports, as well as potential retaliatory tariffs or other measures other countries may impose on U.S. imports, that may adversely affect the global economy. We are currently uncertain as to the ultimate impact these measure may have given the rapidly changing environment surrounding tariffs and other related political topics; however, if enacted as currently proposed, we expect that the proposed tariffs would primarily impact our North America segment as we procure fasteners and a small number of other products from countries that will be subjected to the these tariffs. Additionally, economic pressures on our customers, including the potential of higher inflation, fluctuations in consumer confidence, driven by economic concerns or price increases, such as those we recently announced, could reduce demand for our products and services negatively affecting our net sales and profitability in the future.

Current wording

We are closely monitoring the recent tariff and trade policy actions taken by the U.S. and foreign governments. As the situation continues to remain fluid due to the rapidly changing global trade environment, we are still evaluating the potential implications of these actions on our business. While we are largely domestically sourced, we continue to monitor macroeconomic trends such as the impact of inflation, the effects of recently implemented tariffs, and the potential imposition of modified or additional tariffs in markets where we and our supplier operate. As a result of the tariff’s announced by the U.S. presidential administration on April 2, 2025 and June 15, 2025, and potential tariff modifications or the imposition of tariffs or export controls by other countries there is significant economic uncertainty. The extent and duration of tariffs and the resulting impact on macroeconomic conditions and on our business are uncertain and may depend on various factors beyond our control. We are closely monitoring the potential for the imposition of new or additional U.S. tariffs on imports, as well as potential retaliatory tariffs or other measures other countries may impose on U.S. imports, that may adversely affect the global economy. We are currently uncertain as to the ultimate impact these measure may have given the rapidly changing environment surrounding tariffs and other related political topics; however, if enacted as currently proposed, we expect that the proposed tariffs would primarily impact our North America segment as we procure fasteners and a small number of other products from countries that will be subjected to the these tariffs. Additionally, economic pressures on our customers, including the potential of higher inflation, fluctuations in consumer confidence, driven by economic concerns or price increases, such as those we recently announced, could reduce demand for our products and services negatively affecting our net sales and profitability in the future.

Previous wording

Historically, our North America segment has generated more revenues from wood construction products compared to concrete construction products. North America net sales increased for the quarter ended March 31, 2025 compared to March 31, 2024, due to incremental sales from the Company's 2024 acquisitions and timing of volume discount estimates that negatively impacted 2024 net sales. The increases were partly offset by the negative effect of approximately $1.5 million in foreign currency translation. Our wood construction product net sales increased 3.5% for the quarter ended March 31, 2025 compared to March 31, 2024. Our concrete construction product sales increased 0.7% over the same periods. For 2025, U.S. housing starts could stay flat or increase in the low-single digit range from 2024 levels, with growth weighted towards the second half of the year. With the investments we have made, we believe we will be able to continue to grow net sales above the U.S. housing starts market, one of our ambitions.

Current wording

Historically, our North America segment has generated more revenues from wood construction products compared to concrete construction products. North America net sales increased for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 due to incremental sales from the Company's 2024 acquisitions and price increase that took effect in June 2025. The increases were partly offset by decreased sales volumes and the negative effect of approximately $1.9 million in foreign currency translation. Our wood construction product net sales increased 4.6% for the six months ended June 30, 2025 compared to June 30, 2024. Our concrete construction product net sales increased 6.2% over the same periods. For 2025, U.S. housing starts could decline in the low-single digit range from 2024 levels. With the investments we have made, we believe we will be able to continue to grow volumes above the U.S. housing starts market, one of our ambitions. For the year-to-date period, housing starts have decreased in 2025 compared to the same period in 2024.

Previous wording

Operating income increased 5.4% to $104.2 million from $98.9 million. The increase was primarily due to higher gross profits, partially offset by higher operating expenses. The operating expense increases were driven by higher personnel costs and variable incentive compensation costs. For 2025, incremental investments in the current business will be limited until the U.S. housing market shows long-term improvement.

Current wording

Operating income increased 4.5% to $241.3 million. The increase was primarily due to higher gross profits, partially offset by higher operating expenses. The operating expense increases were driven primarily by higher personnel costs and variable compensation. Additional incremental investments in the business willbe limited until the U.S. housing market shows long-term improvement.

Previous wording

During 2025, work continued on our Columbus, Ohio facility expansion as well as the construction our new Gallatin, Tennessee facility. We expect the expansion and operation of these facilities to be completed and commence in 2025. The expanded and new facilities are expected to improve our overall service, production efficiencies and safety in the workplace, as well as reduce our reliance on certain outsourced finished goods and component products and continue to ensure we have ample capacity to meet our customer needs. These investments reinforce our core business model differentiators to remain the partner of choice as we continue to produce products locally and ensure superior levels of customer service.

Current wording

In May 2025, we held the grand opening on our Columbus, Ohio facility. We expect the construction of our new Gallatin, Tennessee facility to be completed and operations to commence in the fourth quarter of 2025. These facilities are expected to improve our overall service, production efficiencies and safety in the workplace, as well as reduce our reliance on certain outsourced finished goods and component products. These facilities will help ensure we have ample capacity to meet our customer needs. These investments reinforce our core business model differentiators to remain the partner of choice as we continue to produce products locally and ensure superior levels of customer service.

Previous wording

Europe net sales decreased 5.1% for the quarter ended March 31, 2025 compared to March 31, 2024, primarily due the negative effect of approximately $4.0 million in foreign currency translation. Wood construction product sales decreased 4.6% for the quarter ended March 31, 2025 compared to March 31, 2024 and concrete construction product sales, which are mostly project based, decreased 7.3% for the quarter ended March 31, 2025 compared to March 31, 2024. Gross profit decreased $3.8 million primarily due to higher factory and overhead, labor, as well as warehouse costs, partly offset by lower material costs. Operating income increased $1.1 million primarily due to a decrease in operating expenses including variable compensation costs.We currently anticipate Europe 2025 results to be impacted by economic headwinds but also believe in the long term potential given Europe's on-going housing shortage (with an increasing use of wood construction) and new environmental regulations for which we have products and solutions.

Current wording

Europe net sales decreased 1.0% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, Wood construction product net sales decreased 0.9% for the six months ended June 30, 2025 compared to June 30, 2024 and concrete construction product net sales, which are mostly project based, decreased 1.6% over the same periods. Gross profit decreased $1.5 million primarily due to lower net sales as well as gross margins decreasing to 35.7% from 35.9% due to increased factory overhead, warehouse and labor costs, partially offset by lower material costs, as a percentage of net sales. Operating income increased $4.6 million and operating margin increased to 10.1% from 8.2%due to lower operating and integration expenses. We currently anticipate Europe 2025 results to be impacted by economic headwinds but also believe in the long term potential given Europe's on-going housing shortage (with an increasing use of wood construction) and new environmental regulations for which we have products and solutions.

Previous wording

◦Given the uncertainty regarding 2025 U.S. housing starts compared to prior year housing starts, consolidated operating margin is estimated to be in the range of 18.5% to 20.5% with the low end of the range based on flat to declining 2025 housing starts compared to prior year and price increases implemented in 2025. The operating margin range includes a projected benefit of between $10.0 million and $12.0 million from the sale of the existing Gallatin, Tennessee facility based on a contracted sales price of $19.1 million.

Current wording

•Consolidated operating margin is estimated to be in the range of 18.5% to 20.5% given the declining trends and projections for 2025 U.S. housing starts compared to the prior year and the current trade environment. The outlook reflects the previously announced price increases that went into effect on June 2, 2025. The operating margin range does not include any additional pricing actions in 2025 and includes a projected benefit of $12.0 million to $13.0 million from the sale of the original Gallatin, Tennessee facility based on a contracted sales price of $19.1 million.

Previous wording

◦Capital expenditures are estimated to be approximately $150.0 million to $170.0 million, which includes $75.0 million for the Columbus, Ohio facility expansion and construction of the new Gallatin, Tennessee facility.

Current wording

•Capital expenditures are estimated to range between $140.0 and $160.0 million, which includes approximately $70.0 million to $75.0 million remaining for both the Columbus, Ohio facility expansion and the new Gallatin, Tennessee facility construction.

Previous wording

Unless otherwise stated, the below results, when providing comparisons (which are generally indicated by words such as “increased,” “decreased,” “unchanged” or “compared to”), compare the results of operations for the three months ended March 31, 2025 against the results of operations for the three months ended March 31, 2024. Unless otherwise stated, the results announced below, when referencing “both quarters,” refer to the three months ended March 31, 2024 and the three months ended March 31, 2025.

Current wording

Unless otherwise stated, the below results, when providing comparisons (which are generally indicated by words such as “increased,” “decreased,” “unchanged” or “compared to”), compare the results of operations for the three months ended June 30, 2025, against the results of operations for the three months ended June 30, 2024. Unless otherwise stated, the results announced below, when referencing “both quarters,” refer to the three months ended June 30, 2024 and the three months ended June 30, 2025. In the first quarter of 2025, the Company reclassified certain engineering costs related to the Company's digital efforts from research and development and engineering expense as well as selling expense to general and administrative expense. The financial results of prior three months ended June 30, 2024 were revised to reflect these changes with $2.8 million of costs being reclassified from research and development expenses and $1.4 million from selling expense to general and administrative expense. The reclassification did not have any impact on the total operating expenses.

Previous wording

First Quarter 2025 Consolidated Financial Highlights

Current wording

Second Quarter 2025 Consolidated Financial Highlights

Previous wording

Netsales increased 1.6% to $538.9 million from $530.6 million. As noted above, North America sales increased primarily due to incremental sales from the Company's 2024 acquisitions and timing of volume discount estimates that negatively impacted 2024 net sales. The increases were partly offset by the negative effect of foreign currency translation of approximately $1.5 million from North America and approximately $4.0 million from Europe. Wood construction product sales, including sales of connectors, truss plates, fastening systems, fasteners and shearwalls, represented approximately 85.3% and 85.1%of the Company's total sales in the first quarters of 2025 and 2024, respectively. Concrete construction product sales, including sales of adhesives, chemicals, mechanical anchors, powder actuated tools and reinforcing fiber materials, represented 14.4% and 14.8% of the Company's total sales in the first quarters of 2025 and 2024, respectively.

Current wording

Net sales increased 5.7% to $631.1 million from $597.0 million. Wood construction product sales, including sales of connectors, truss plates, fastening systems, fasteners and shearwalls, represented 84.9% and 85.5% of the Company's total sales in the second quarters of 2025 and 2024, respectively. Concrete construction product sales, including sales of adhesives, chemicals, mechanical anchors, powder actuated tools and reinforcing fiber materials, represented 15.0% and 14.5% of the Company's total sales in the second quarters of 2025 and 2024, respectively.

Previous wording

Our effective income tax rate increased to 25.5% from 23.4%.

Current wording

Our effective income tax rate decreased to 25.8%from 26.3%.

Previous wording

Consolidated net incomewas $77.9 million compared to $75.4 million. Diluted earnings per share was $1.85 compared to $1.77.

Current wording

Consolidated net incomewas $103.5 million compared to $97.8 million. Diluted earnings per share was $2.47 compared to $2.31.

Previous wording

Adjusted EBITDA 1 of $121.8 million increased 3.8% compared to $117.3 million, primarily due to higher gross profits, as noted above.

Current wording

Adjusted EBITDA 1 of $159.9 million increased 4.8% compared to $152.6 million, primarily due to higher gross profits.

Previous wording

The following table shows gross profit by segment for the three months ended March 31, 2025 and 2024, respectively:

Current wording

The following table shows gross profit (loss) by segment for the three months ended June 30, 2025 and 2024, respectively:

Previous wording

•Gross margin decreased to 35.2% from 36.5%primarily due to higher factory and overhead, labor, as well as warehouse costs, partly offset by lower material costs, as a percentage of net sales.

Current wording

•Gross margin decreased to 49.8% from 50.0%, primarily due to higher warehouse costs, as a percentage of net sales.

Previous wording

•Income from operations increased by $5.3 million due to the factors discussed above.

Current wording

•Income from operations increased by $4.4 million due to the factors discussed above.

Previous wording

•Income from operations increased by $1.0 million to $9.3 million from $8.3 million mainly due to a 8.6% decrease in operating expenses including variable compensation costs.

Current wording

•Income from operations increased by $3.5 million to $15.7 million from $12.1 million primarily due to an increase in gross profit and a decrease in operating expenses including variable compensation and travel related costs.

Previous wording

The following table shows gross margins by segment for the three months ended March 31, 2025 and 2024, respectively:

Current wording

The following table represents gross margins by segment for the six-month periods ended June 30, 2024 and 2025:

Previous wording

See “Note 1 Basis of Presentation —Accounting Standards Not Yet Adopted” to the accompanying unaudited interim Condensed Consolidated Financial Statements.

Current wording

See “Note 1 Basis of Presentation —Accounting Standard Adopted” and “Note 1 Basis of Presentation —Accounting Standards Not Yet Adopted” to the accompanying unaudited interim Condensed Consolidated Financial Statements.

Previous wording

On March 30, 2022, the Company entered into a Credit Agreement. The Credit Agreement provides for a 5-year revolving credit facility of $450.0 million, which includes a letter of credit sub-facility up to $50 million and for a 5-year term loan facility of $450.0 million. As of March 31, 2025, the Company had no borrowings under the revolving credit facility and had $382.5 million under the term loan facility and has $450.0 million available to borrow under the revolving credit facility.

Current wording

On March 30, 2022, the Company entered into a Credit Agreement. The Credit Agreement provides for a 5-year revolving credit facility of $450.0 million, which includes a letter of credit sub-facility up to $50.0 million and for a 5-year term loan facility of $450.0 million. As of June 30, 2025, the Company had no borrowings under the revolving credit facility and $376.9 million under the term loan facility, and has $450.0 million available to borrow under the revolving credit facility.

Previous wording

As of March 31, 2025, our cash and cash equivalents consisted of deposits and money market funds held with established national financial institutions, including $89.5 million that is held in the local currencies of our foreign operations and could be subject to additional taxation if repatriated to the U.S. The Company is maintaining a permanent reinvestment assertion on its foreign earnings relative to remaining cash held outside the United States.

Current wording

As of June 30, 2025, our cash and cash equivalents consisted of deposits and money market funds held with established national financial institutions, including $82.0 million that is held in the local currencies of our foreign operations and could be subject to additional taxation if repatriated to the U.S. The Company is maintaining a permanent reinvestment assertion on its foreign earnings relative to remaining cash held outside the United States.

Previous wording

The following table presents the significant categories of cash flows used or provided during the three-month periods ended March 31, 2025 and 2024, respectively:

Current wording

The following table presents the significant categories of cash flows used or provided during the six-month periods ended June 30, 2025 and 2024, respectively:

Previous wording

Cash flows from operating activities result primarily from our earnings before non-cash items such as depreciation, amortization, and stock-based compensation, and are also affected by changes in operating assets and liabilities which consist primarily of working capital balances. Our revenues are derived from manufacturing and sales of building construction materials. Our operating cash flows are impacted by prevailing macro-economic conditions and subject to seasonality, which is cyclically associated with the volume and timing of construction project starts. For example, as a result of seasonality our trade accounts receivable are generally lowest at the end of the fourth quarter and increases during the first, second and third quarters as construction activity ramps in markets we serve.

Current wording

Cash flow from operating activities result primarily from our earnings before non-cash items such as depreciation, amortization, and stock-based compensation, and are also affected by changes in operating assets and liabilities which consist primarily of working capital balances. Our revenues are derived from manufacturing and sales of building construction materials. Our operating cash flows are impacted by prevailing macro-economic conditions and subject to seasonality, which is cyclically associated with the volume and timing of construction project starts. For example, as a result of seasonality our trade accounts receivable are generally lowest at the end of the fourth quarter and increases during the first, second, and third quarters as construction activity ramps in markets we serve.

Previous wording

During the three months ended March 31, 2025, operating activities provided $7.6 million in cash, as a result of $77.9 million from net income plus $28.2 million non-cash expenses such as depreciation and amortization, stock-based compensation, and leases. This amount was partly offset by $98.5 million used for the net change in operating assets and liabilities. The net change in operating assets and liabilities included increases of $85.4 million in trade accounts receivable and $18.5 million in inventory.

Current wording

During the six months ended June 30, 2025, operating activities provided $132.8 million in cash, as a result of $181.4 million from net income plus $60.1 million non-cash expenses such as depreciation and amortization, deferred compensation, stock-based compensation, and leases. This amount was partly offset by $108.7 million used for the net change in operating assets and liabilities. The net change in operating assets and liabilities included increases of $120.8 million in trade accounts receivable, partly offset by a decrease of $26.1 million in inventory.

Previous wording

Cash used in investing activities of $50.1 million during the three months ended March 31, 2025, which was primarily used for facility expansion projects and machinery and equipment purchases. Due to updated forecasts on the timing of the spend and subject to future events and circumstances, capital expenditures are estimated to be in the range of $150.0 million to $170.0 million, which includes approximately $75.0 million remaining for both the Columbus, Ohio facility expansion and the new Gallatin, Tennessee facility. The remaining capital expenditures will be primarily focused on purchases of new equipment to support increased productivity and efficiencies, enhancements to our existing facilities to expand our manufacturing footprint in-line with increasing customer needs, as well as investments for adjacencies and key growth initiatives.

Current wording

Cash flow used in investing activities of $90.6 million during the six months ended June 30, 2025 was primarily used for facility expansion projects as well as machinery and equipment purchases. Due to updated forecasts on the timing of the spend and subject to future events and circumstances, capital expenditures are estimated to be in the range of $140.0 million and $160.0, which includes approximately $70.0 million to $75.0 million remaining for both the Columbus, Ohio facility expansion and the new Gallatin, Tennessee facility. The remaining capital expenditures will be primarily focused on purchases of new equipment to support increased productivity and efficiencies, enhancements to our existing facilities to expand our manufacturing footprint in-line with increasing customer needs, as well as investments for adjacencies and key growth initiatives.

Previous wording

Cash used in financing activities of $42.8 million during the three months ended March 31, 2025 consisted primarily of$25.0 million in share repurchases,$11.7 million used to pay dividends to our stockholders, and $6.8 million used for debt repayment.

Current wording

Cash flow used in financing activities of $95.6 million during the six months ended June 30, 2025 consisted primarily of$60.0 million in stock repurchases and $23.5 million used to pay dividends to our stockholders.

Previous wording

Since the beginning of 2022 through May 7, 2025, we have returned$401.0 million to stockholders, which includes the repurchase of over 1.9 million shares of the Company's common stock, representing approximately 4.3% of the outstanding shares of the Company's common stock at the start of 2022.

Current wording

Since the beginning of 2022 through the period ended June 30, 2025, we have returned $447.7 million to stockholders, which represents 51.0% of our free cash flow from operations during the same period, and over the same period the Company has repurchased over two million shares of the Company's common stock, which represents approximately 4.8% of the outstanding shares of the Company's common stock at the start of 2022.