MSC INDUSTRIAL DIRECT CO INC

Previous wording

MSC is a leading North American distributor of a broad range of metalworking and maintenance, repair and operations (“MRO”) products and services. We help our customers drive greater productivity, profitability and growth with inventory management and other supply chain solutions and deep expertise from more than 80 years of working with customers across industries. We offer approximately 2.5 million active, saleable stock-keeping units through our E-commerce channels, including our website, www.mscdirect.com (the “MSC website”); our inventory management solutions; our catalogs; our brochures; and our customer care centers, customer fulfillment centers (“CFCs”), regional inventory centers and warehouses. We service our customers from five CFCs, nine regional inventory centers, 37 warehouses, and five manufacturing locations. We continue to implement our strategies to gain market share, generate new customers, increase sales to existing customers and diversify our customer base.

Current wording

MSC is a leading North American distributor of a broad range of metalworking, maintenance, repair and operations (“MRO”), and production fastener and hardware products and services. We help our customers drive greater productivity, profitability and operational performance with industry-leading inventory management and supply chain solutions and deep expertise from more than 80 years of working with customers across industries. We offer approximately 2.5 million active, saleable stock-keeping units through our E-commerce channels, including our website, www.mscdirect.com (the “MSC website”); our inventory management solutions; our catalogs; our brochures; and our customer care centers, customer fulfillment centers (“CFCs”), regional inventory centers and warehouses. We service our customers from five CFCs, nine regional inventory centers, 37 warehouses, and five manufacturing locations. We continue to implement our strategies to gain market share, generate new customers, increase sales to existing customers and diversify our customer base.

Previous wording

Our business model focuses on providing overall procurement cost reduction and just-in-time delivery to meet our customer’s needs. Many of our products are carried in stock, and orders for these in-stock products are typically fulfilled the day on which the order is received. We focus on offering inventory, process and procurement solutions that reduce supply chain costs and improve plant floor productivity for our customers. We aim to achieve ongoing cost reductions throughout our business by implementing cost-saving strategies and leveraging our existing infrastructure. Additionally, we provide our customers with further procurement cost-saving solutions through technologies such as our Vendor Managed Inventory (“VMI”), Customer Managed Inventory (“CMI”) and vending programs — helping reduce downtime and ensure critical products are available when and where they are needed. Our vending machines in service totaled 30,177 as of November 29, 2025, compared to 27,747 as of November 30, 2024, and our In-Plant programs totaled 418 locations as of November 29, 2025, compared to 369 as of November 30, 2024. Our sales force, which focuses on a more complex and high-touch role, drives value for our customers by enabling them to achieve higher levels of growth, profitability and productivity. Our field sales and service associate headcount was 2,631 as of November 29, 2025, compared to 2,723 as of November 30, 2024.

Current wording

Our business model focuses on providing overall procurement cost reduction and just-in-time delivery to meet our customer’s needs. Many of our products are carried in stock, and orders for these in-stock products are typically fulfilled the day on which the order is received. We focus on offering inventory, process and procurement solutions that reduce supply chain costs and improve plant floor productivity for our customers. We aim to achieve ongoing cost reductions throughout our business by implementing cost-saving strategies and leveraging our existing infrastructure. Additionally, we provide our customers with further procurement cost-saving solutions through technologies such as our Vendor Managed Inventory (“VMI”), Customer Managed Inventory (“CMI”) and vending programs — helping reduce downtime and ensure critical products are available when and where they are needed. Our vending machines in service totaled 30,414 as of February 28, 2026, compared to 28,085 as of March 1, 2025, and our In-Plant programs totaled 423 locations as of February 28, 2026, compared to 387 as of March 1, 2025. Our sales force, which focuses on a more complex and high-touch role, drives value for our customers by enabling them to achieve higher levels of growth, profitability and productivity. Our field sales and service associate headcount was 2,473 as of February 28, 2026, compared to 2,726 as of March 1, 2025.

Previous wording

Highlights during the thirteen weeks ended November 29, 2025 include:

Current wording

Highlights during the twenty-six weeks ended February 28, 2026 include:

Previous wording

•We generated $29.4 million of cash from operations, compared to $101.9 million for the same period in the prior fiscal year.

Current wording

•We generated $123.8 million of cash from operations, compared to $156.3 million for the same period in the prior fiscal year.

Previous wording

•We had net borrowings of $45.0 million on our credit facilities and private placement debt, compared to net borrowings of $11.8 million for the same period in the prior fiscal year.

Current wording

•We had net borrowings of $25.0 million on our credit facilities, compared to net borrowings of $30.3 million for the same period in the prior fiscal year.

Previous wording

•We paid out an aggregate $48.6 million in regular cash dividends, compared to an aggregate $47.5 million in regular cash dividends for the same period in the prior fiscal year.

Current wording

•We paid out an aggregate $97.2 million in regular cash dividends, compared to an aggregate $94.9 million in regular cash dividends for the same period in the prior fiscal year.

Previous wording

•We repurchased $13.0 million of MSC’s Class A Common Stock, par value $0.001 per share (“Class A Common Stock”), excluding excise taxes, compared to $18.1 million for the same period in the prior fiscal year.

Current wording

•We repurchased 160 thousand shares of MSC’s Class A Common Stock, par value $0.001 per share (“Class A Common Stock”) for $13.7 million, excluding excise taxes, compared to 377 thousand shares repurchased for $30.5 million, excluding excise taxes, for the same period in the prior fiscal year.

Previous wording

•We incurred $4.9 million in Restructuring and other costs, compared to $2.3 million for the same period in the prior fiscal year, consisting primarily of current year severance and separation costs associated with the Company’s sales optimization efforts as well as consulting-related costs in the current and prior fiscal year.

Current wording

•We incurred $7.3 million in Restructuring and other costs, compared to $3.8 million for the same period in the prior fiscal year, consisting primarily of current year severance and separation costs associated with the Company’s sales optimization efforts as well as consulting-related costs in the current and prior fiscal year.

Previous wording

The first phase of our Company-wide initiative, referred to as “Mission Critical,” focused on market share capture and improved profitability. We successfully executed on the first phase of Mission Critical initiatives at the end of fiscal year 2023, which included solidifying our market-leading metalworking business, with an emphasis on selling our product portfolio, expanding our solutions, improving our digital and E-commerce capabilities and diversifying our customers and end-markets. The next phase of our Mission Critical journey, which began in fiscal year 2024, is anchored in three pillars: (i) maintaining the momentum of the first phase of the Mission Critical program and our existing growth drivers, (ii) increasing our focus on both core customers and OEM fasteners, and (iii) driving productivity improvements and reducing operating expenses as a percentage of net sales. To accomplish the next phase of our Mission Critical journey, we intend to leverage investments in advanced analytics to improve supply chain performance and upgrade our digital core to unlock productivity within our order-to-cash and procure-to-pay processes. In fiscal year 2024, we completed our web price realignment initiative. In fiscal year 2025, we launched our enhanced marketing efforts, rolled out several E-commerce enhancements and began our sales optimization initiative, which included investment in an enhanced, data-driven territory model to optimize field seller portfolios. The Company continued its sales optimization efforts in the first quarter of fiscal year 2026.

Current wording

The first phase of our Company-wide initiative, referred to as “Mission Critical,” focused on market share capture and improved profitability. We successfully executed on the first phase of Mission Critical initiatives at the end of fiscal year 2023, which included solidifying our market-leading metalworking business, with an emphasis on selling our product portfolio, expanding our solutions, improving our digital and E-commerce capabilities and diversifying our customers and end-markets. The next phase of our Mission Critical journey, which began in fiscal year 2024, is anchored in three pillars: (i) maintaining the momentum of the first phase of the Mission Critical program and our existing growth drivers, (ii) increasing our focus on both core customers and OEM fasteners, and (iii) driving productivity improvements and reducing operating expenses as a percentage of net sales. To accomplish the next phase of our Mission Critical journey, we intend to leverage investments in advanced analytics to improve supply chain performance and upgrade our digital core to unlock productivity within our order-to-cash and procure-to-pay processes. In fiscal year 2024, we completed our web price realignment initiative. In fiscal year 2025, we launched our enhanced marketing efforts, rolled out several E-commerce enhancements and began our sales optimization initiative, which included investment in an enhanced, data-driven territory model to optimize field seller portfolios. The Company continued its sales optimization efforts during the first half of fiscal year 2026.

Previous wording

The United States economy has experienced various macroeconomic pressures in recent years including pricing pressure from tariffs and inflation, sustained high interest rates and general economic and political uncertainty. The impact from tariffs was most significant in the latter half of the Company's fiscal year 2025 and has continued into the first quarter of fiscal year 2026. Furthermore, as a supplier to the United States federal government, the federal government shutdown, which lasted from October 1, 2025 through November 12, 2025, negatively impacted sales to our public sector end-market during the first quarter of fiscal year 2026. These pressures have impacted, and may continue to impact in the future, the Company’s business, financial condition and results of operations.

Current wording

The United States economy has experienced various macroeconomic pressures in recent years including pricing pressure from tariffs and inflation, sustained high interest rates, increased fuel costs and general economic and political uncertainty. The impact from tariffs was most significant in the latter half of the Company's fiscal year 2025 and has continued into fiscal year 2026. Furthermore, as a supplier to the United States federal government, the federal government shutdown during the Company’s fiscal first quarter and the partial federal government shut downs during the Company’s fiscal second quarter negatively impacted sales to our public sector end-market. Additionally, increased fuel costs resulting from the conflict in Iran and geopolitical tensions in the region has increased macroeconomic uncertainty generally and may lead to higher freight expense and cost pressure on the products offered by the Company. These pressures have impacted, and may continue to impact in the future, the Company’s business, financial condition and results of operations.

Previous wording

We utilize various indices when evaluating the level of our business activity, including the Industrial Production (“IP”) Index. Through statistical analysis, we have found that trends in our customers’ activity have correlated to changes in the IP Index. The IP Index measures short-term changes in industrial production. Growth in the IP Index compared to the prior quarter indicates growth in the manufacturing, mining and utilities industries. Approximately 67% of our revenues came from sales in the manufacturing sector during the thirteen-week period ended November 29, 2025. After giving effect to the annual technical revisions to calculations of the IP Index which occurred in November 2025, the IP Index over the three months ended November 2025 and the average for the three- and 12-month periods ended November 2025 were as follows:

Current wording

We utilize various indices when evaluating the level of our business activity, including the Industrial Production (“IP”) Index. Through statistical analysis, we have found that trends in our customers’ activity have correlated to changes in the IP Index. The IP Index measures short-term changes in industrial production. Growth in the IP Index compared to the prior quarter indicates growth in the manufacturing, mining and utilities industries. Approximately 67% of our revenues came from sales in the manufacturing sector during both the thirteen- and twenty-six-week periods ended February 28, 2026. After giving effect to the annual technical revisions to calculations of the IP Index which occurred in November 2025, the IP Index over the three months ended February 2026 and the average for the three- and 12-month periods ended February 2026 were as follows:

Previous wording

The average IP Index for the three months ended November 2025 was 101.7, flat compared to the prior quarter average of 101.7 and an increase from an average of 99.5 during the comparative quarter in the prior year.

Current wording

The average IP Index for the three months ended February 2026 was 102.2, an increase compared to the prior quarter average of 101.7 and an increase from an average of 100.5 during the comparative quarter in the prior year.

Previous wording

During the first quarter of fiscal year 2026, the Company experienced a more stable demand environment compared to much of fiscal year 2025. The heavy manufacturing industry, which represented 58% of our revenues during the thirteen-week period ended November 29, 2025, showed signs of expansion. Several IP subindexes, in particular Aerospace, improved, while others, such as Automotive, signaled contraction. Non-manufacturing demand, in particular the Company’s public sector end-market, was hampered by the federal government shutdown which resulted in lower sales volumes in October and November. We will monitor the current economic conditions for the impact on our customers and markets and assess both risks and opportunities that may affect our business and operations.

Current wording

During fiscal year 2026, the Company has experienced a more constructive demand environment compared to much of fiscal year 2025. The heavy manufacturing industry, which represented 58% of our revenues during the thirteen-week period ended February 28, 2026, showed signs of expansion. Several IP subindexes, including Aerospace, Machinery and Equipment, Primary Metals and Fabricated Metals improved. Non-manufacturing demand, in particular the Company’s public sector end-market, recovered from lower sales levels in the first fiscal quarter as a result of the federal government shutdown but such recovery was partially offset by the partial federal government shutdowns during January and February and continuing into our third fiscal quarter. We will monitor the current economic conditions for the impact on our customers and markets and assess both risks and opportunities that may affect our business and operations.

Previous wording

Net sales increased 4.0%, or $37.2 million, to $965.7 million for the thirteen-week period ended November 29, 2025, as compared to $928.5 million for the same period in the prior fiscal year. The $37.2 million increase in net sales was comprised of a positive impact from pricing of $39.0 million and favorable foreign exchange impact of $1.0 million, partially offset by $2.8 million of lower sales volume, which was primarily driven by the federal government shutdown. The positive pricing impact was inclusive of changes in customer and product mix, discounting, favorable tariff-related pricing actions and other items. Of the $37.2 million increase in net sales during the thirteen-week period ended November 29, 2025, sales to our core and other customers increased $31.9 million, sales to our national account customers increased $9.8 million and sales to our public sector customers decreased $4.5 million.

Current wording

Net sales increased 2.9%, or $26.1 million, to $917.8 million for the thirteen-week period ended February 28, 2026, as compared to $891.7 million for the same period in the prior fiscal year. The $26.1 million increase in net sales was comprised of a positive impact from pricing of $58.8 million and favorable foreign exchange impact of $2.9 million, partially offset by $35.6 million of lower sales volume. The positive pricing impact was inclusive of changes in customer and product mix, discounting, favorable tariff-related pricing actions and other items. Of the $26.1 million increase in net sales during the thirteen-week period ended February 28, 2026, sales to our core and other customers increased $26.5 million, sales to our national account customers increased $0.6 million and sales to our public sector customers decreased $1.0 million.

Previous wording

We believe that our ability to transact business with our customers directly through the MSC website as well as through various other electronic portals gives us a competitive advantage over smaller suppliers. Sales made through our E-commerce platforms, including sales made through Electronic Data Interchange (“EDI”) systems, VMI systems, Extensible Markup Language ordering-based systems, vending, hosted systems and other electronic portals, represented 64.2% of consolidated net sales for the thirteen-week period ended November 29, 2025, as compared to 63.7% of consolidated net sales for the same period in the prior fiscal year.

Current wording

We believe that our ability to transact business with our customers directly through the MSC website as well as through various other electronic portals gives us a competitive advantage over smaller suppliers. Sales made through our E-commerce platforms, including sales made through Electronic Data Interchange (“EDI”) systems, VMI systems, Extensible Markup Language ordering-based systems, vending, hosted systems and other electronic portals, represented 64.1% of consolidated net sales for the thirteen-week period ended February 28, 2026, as compared to 63.6% of consolidated net sales for the same period in the prior fiscal year.

Previous wording

Gross profit of $392.7 million for the thirteen-week period ended November 29, 2025 increased $14.5 million, or 3.8%, compared to the same period in the prior fiscal year. Gross profit margin was 40.7% for the thirteen-week period ended November 29, 2025, which was flat to the same period in the prior fiscal year. The increase in gross profit was primarily a result of an increase in net sales, as described above, while gross profit margin remained comparable to the prior year period.

Current wording

Gross profit increased 3.4%, or $12.4 million, to $377.6 million for the thirteen-week period ended February 28, 2026, compared to $365.2 million for the same period in the prior fiscal year. Gross profit margin was 41.1% for the thirteen-week period ended February 28, 2026, as compared to 41.0% for the same period in the prior fiscal year. The increase in gross profit was primarily a result of an increase in net sales, as described above, while the increase in gross profit margin was primarily a result of favorable pricing actions as a result of tariff-driven product cost inflation concerns.

Previous wording

Payroll and payroll-related costs, which include salary, incentive compensation, sales commission and fringe benefit costs, were $174.5 million, or 56.0% of total Operating expenses, for the thirteen-week period ended November 29, 2025, as compared to $173.7 million, or 57.2% of total Operating expenses, for the same period in the prior fiscal year.

Current wording

Payroll and payroll-related costs, which include salary, incentive compensation, sales commission and fringe benefit costs, were $171.2 million, or 55.2% of total Operating expenses, for the thirteen-week period ended February 28, 2026, as compared to $173.3 million, or 57.5% of total Operating expenses, for the same period in the prior fiscal year. The headcount reduction actions during fiscal year 2026 resulted in lower salary, sales commissions and incentive compensation costs, which was partially offset by our annual merit increase.

Previous wording

Freight expense was $36.4 million for the thirteen-week period ended November 29, 2025, as compared to $37.5 million for the same period in the prior fiscal year. The primary driver of the decrease was favorable third-party shipping rates achieved through our network optimization initiatives.

Current wording

Freight expense was $35.0 million for the thirteen-week period ended February 28, 2026, as compared to $35.8 million for the same period in the prior fiscal year. The primary driver of the decrease was favorable third-party shipping rates achieved through our network optimization initiatives.

Previous wording

Depreciation and amortization was $24.6 million for the thirteen-week period ended November 29, 2025, as compared to $21.2 million for the same period in the prior fiscal year. The primary drivers of the increase in depreciation and amortization were increased capital expenditures related to E-commerce and digital initiatives.

Current wording

Depreciation and amortization was $24.8 million for the thirteen-week period ended February 28, 2026, as compared to $22.5 million for the same period in the prior fiscal year. The primary drivers of the increase in depreciation and amortization were increased capital expenditures related to E-commerce and digital initiatives.

Previous wording

We incurred $4.9 million in Restructuring and other costs for the thirteen-week period ended November 29, 2025, as compared to $2.3 million for the same period in the prior fiscal year. The increase was primarily related to higher severance and separation benefits related to headcount reduction actions during the period. See Note 10, “Restructuring and Other Costs” in the Notes to Condensed Consolidated Financial Statements for additional information.

Current wording

We incurred $2.5 million in Restructuring and other costs for the thirteen-week period ended February 28, 2026, as compared to $1.4 million for the same period in the prior fiscal year. The increase was primarily related to higher severance and separation benefits associated with the Company’s workforce realignment actions in the current fiscal year. See Note 9, “Restructuring and Other Costs” in the Notes to Condensed Consolidated Financial Statements for additional information.

Previous wording

The Company’s effective tax rate for the thirteen-week period ended November 29, 2025 was 24.3%, as compared to 24.6% for the same period in the prior fiscal year.

Current wording

The Company’s effective tax rate for the thirteen-week period ended February 28, 2026 was 24.7%, as compared to 24.3% for the same period in the prior fiscal year. The increase in the effective tax rate was primarily due to lower permanent deductions compared to the prior year.

Previous wording

Operating expenses increased 2.6%, or $8.0 million, to $311.6 million for the thirteen-week period ended November 29, 2025, as compared to $303.6 million for the same period in the prior fiscal year. Operating expenses were 32.3% of net sales for the thirteen-week period ended November 29, 2025, as compared to 32.7% for the same period in the prior fiscal year. The increase in Operating expenses was primarily a result of advertising expense and higher depreciation and amortization expense. The decrease in operating expenses as a percentage of net sales was primarily due to growth in net sales outpacing the increase in Operating expenses.

Current wording

Operating expenses increased 2.8%, or $16.8 million, to $621.9 million for the twenty-six-week period ended February 28, 2026, as compared to $605.1 million for the same period in the prior fiscal year. Operating expenses were 33.0% of net sales for the twenty-six-week period ended February 28, 2026, as compared to 33.2% for the same period in the prior fiscal year. The increase in Operating expenses was primarily a result of advertising expense and higher depreciation and amortization expense. The decrease in operating expenses as a percentage of net sales was primarily due to growth in net sales outpacing the increase in Operating expenses.

Previous wording

Advertising expense was $14.2 million for the thirteen-week period ended November 29, 2025, as compared to $10.9 million for the same period in the prior fiscal year. The primary driver of the increase was higher search engine marketing spend as part of the Company's enhanced marketing efforts which began in fiscal year 2025.

Current wording

Advertising expense was $26.5 million for the twenty-six-week period ended February 28, 2026, as compared to $22.8 million for the same period in the prior fiscal year. The primary driver of the increase was higher search engine marketing spend as part of the Company's enhanced marketing efforts which began in fiscal year 2025.

Previous wording

Income from operations increased 5.5%, or $4.0 million, to $76.2 million for the thirteen-week period ended November 29, 2025, as compared to $72.3 million for the same period in the prior fiscal year. Income from operations as a percentage of net sales increased to 7.9% for the thirteen-week period ended November 29, 2025, as compared to 7.8% for the same period in the prior fiscal year. The increase in income from operations as a percentage of net sales was primarily attributable to, as described above, a decrease in Operating expenses as a percentage of net sales during the thirteen-week period ended November 29, 2025.

Current wording

Income from operations increased 4.8%, or $6.5 million, to $141.0 million for the twenty-six-week period ended February 28, 2026, as compared to $134.5 million for the same period in the prior fiscal year. Income from operations as a percentage of net sales increased to 7.5% for the twenty-six-week period ended February 28, 2026, as compared to 7.4% for the same period in the prior fiscal year. The increase in income from operations as a percentage of net sales was primarily attributable to, as described above, an increase in gross profit margin and a decrease in Operating expenses as a percentage of net sales.

Previous wording

Total other expense decreased 25.3%, or $3.0 million, to $8.7 million for the thirteen-week period ended November 29, 2025, as compared to $11.7 million for the same period in the prior fiscal year. The decrease was primarily due to the impact of prior year realized and unrealized losses on foreign exchange as well as lower interest costs on our Credit Facilities and lower fees incurred associated with the Receivables Purchase Agreement.

Current wording

Total other expense decreased 21.2%, or $4.7 million, to $17.5 million for the twenty-six-week period ended February 28, 2026, as compared to $22.2 million for the same period in the prior fiscal year. The decrease was primarily due to lower interest costs on our Credit Facilities, lower fees incurred associated with the Receivables Purchase Agreement and remeasurement gains from foreign exchange compared to foreign exchange losses in the prior year.

Previous wording

As of November 29, 2025, we had $40.3 million in cash and cash equivalents, substantially all with well-known financial institutions. Historically, our primary financing needs have been to fund our working capital requirements necessitated by our sales growth and the costs of acquisitions, new products, new facilities, facility expansions, investments in vending solutions, technology investments, and productivity investments. Cash generated from operations, together with borrowings under our credit facilities and net proceeds from the private placement notes, have been used to fund these needs, to repurchase shares of Class A Common Stock from time to time, and to pay dividends to our shareholders.

Current wording

As of February 28, 2026, we had $46.2 million in cash and cash equivalents, substantially all with well-known financial institutions. Historically, our primary financing needs have been to fund our working capital requirements necessitated by our sales growth and the costs of acquisitions, new products, new facilities, facility expansions, investments in vending solutions, technology investments, and productivity investments. Cash generated from operations, together with borrowings under our credit facilities and net proceeds from the private placement notes, have been used to fund these needs, to repurchase shares of Class A Common Stock from time to time, and to pay dividends to our shareholders.

Previous wording

As of November 29, 2025, total borrowings outstanding, representing amounts due under our credit facilities and notes, as well as all finance leases and financing arrangements, were $531.0 million, net of unamortized debt issuance costs of $1.5 million, as compared to total borrowings outstanding of $485.7 million, net of unamortized debt issuance costs of $1.5 million, as of the end of fiscal year 2025. The increase in total borrowings outstanding was driven by higher net borrowings under our credit facilities. See Note 8, “Debt” in the Notes to Condensed Consolidated Financial Statements for more information about these balances.

Current wording

As of February 28, 2026, total borrowings outstanding, representing amounts due under our credit facilities and notes, as well as all finance leases and financing arrangements, were $511.8 million, net of unamortized debt issuance costs of $1.4 million, as compared to total borrowings outstanding of $485.7 million, net of unamortized debt issuance costs of $1.5 million, as of the end of fiscal year 2025. The increase in total borrowings outstanding was driven by higher net borrowings under our credit facilities. See Note 7, “Debt” in the Notes to Condensed Consolidated Financial Statements for more information about these balances.

Previous wording

Net cash provided by operating activities was $29.4 million for the thirteen weeks ended November 29, 2025, compared to $101.9 million for the thirteen weeks ended November 30, 2024. The decrease was primarily due to the following:

Current wording

Net cash provided by operating activities was $123.8 million for the twenty-six weeks ended February 28, 2026, compared to $156.3 million for the twenty-six weeks ended March 1, 2025. The decrease was primarily due to the following:

Previous wording

•an increase in the balances of accounts receivable and inventories in the current fiscal year relative to the prior year. The higher balance of inventories is due to inventory management countermeasures in response to tariffs and the higher accounts receivable balance is due to higher sales levels;

Current wording

•an increase in the change of inventories in the current fiscal year relative to the prior year due to inventory management countermeasures in response to tariffs;

Previous wording

•an increase in prepaid expenses and other current assets in the current fiscal year due primarily to an increase in vendor rebate receivables and IT-related prepayments;

Current wording

•an increase in the change of prepaid expenses and other current assets in the current fiscal year due primarily to an increase in vendor rebate receivables and IT-related prepayments;

Previous wording

•a decrease in accounts payable and accrued liabilities as compared to the prior year period due primarily to the change in accrued payroll and payroll related costs due in turn to the larger fiscal year 2025 annual incentive compensation payment paid in fiscal year 2026 than prior years; partially offset by

Current wording

•a decrease in the change of accounts payable and accrued liabilities as compared to the prior year period due primarily to a decrease in the annual incentive compensation accrual; partially offset by

Previous wording

Working capital and current ratio decreased as of November 29, 2025 compared to November 30, 2024 primarily due to higher Current portion of debt including obligations under finance leases partially offset by higher Inventories and Accounts receivable balances. Working capital increased as of November 29, 2025 compared to August 30, 2025 primarily due to higher Inventories and higher Prepaid expenses and other current assets, partially offset by a lower balance in Cash and cash equivalents.

Current wording

Working capital and current ratio decreased as of February 28, 2026 compared to March 1, 2025 primarily due to higher Current portion of debt including obligations under finance leases and lower Accounts receivable, partially offset by higher Inventories and Prepaid expenses and other current assets. Working capital increased as of February 28, 2026 compared to August 30, 2025 primarily due to higher Inventories and higher Prepaid expenses and other current assets, partially offset by lower Accounts receivable and Accrued expenses and other current liabilities balances.

Previous wording

Days’ sales outstanding as of November 29, 2025 increased compared to both August 30, 2025 and November 30, 2024. The increase in days’ sales outstanding was driven by longer payment term requirements from certain national account customers.

Current wording

Days’ sales outstanding as of February 28, 2026 decreased compared to both August 30, 2025 and March 1, 2025. The improvement in days’ sales outstanding was driven by both improved collections from our national account customers and the RPA amendment in the second quarter of fiscal year 2026.

Previous wording

Net cash used in investing activities for the thirteen weeks ended November 29, 2025 and November 30, 2024 was $21.2 million and $20.4 million, respectively. The use of cash for both the thirteen weeks ended November 29, 2025 and November 30, 2024 was primarily due to expenditures for property, plant and equipment mainly related to vending programs and other infrastructure and technology investments.

Current wording

Net cash used in investing activities for the twenty-six weeks ended February 28, 2026 and March 1, 2025 was $42.5 million and $50.7 million, respectively. The use of cash for both the twenty-six weeks ended February 28, 2026 and March 1, 2025 was primarily due to expenditures for property, plant and equipment mainly related to vending programs and other infrastructure and technology investments.

Previous wording

Net cash used in financing activities was $23.9 million for the thirteen weeks ended November 29, 2025, compared to $53.4 million for the thirteen weeks ended November 30, 2024, primarily due to the following:

Current wording

Net cash used in financing activities was $91.3 million for the twenty-six weeks ended February 28, 2026, compared to $93.1 million for the twenty-six weeks ended March 1, 2025, primarily due to the following:

Previous wording

•$13.0 million in aggregate repurchases of Class A Common Stock during the thirteen weeks ended November 29, 2025, compared to $18.1 million in aggregate repurchases of Class A Common Stock during the thirteen weeks ended November 30, 2024;

Current wording

•$13.7 million, or 160 thousand shares, in aggregate repurchases of Class A Common Stock during the twenty-six weeks ended February 28, 2026, compared to $30.5 million, or 377 thousand shares, in aggregate repurchases of Class A Common Stock during the twenty-six weeks ended March 1, 2025;

Previous wording

•$48.6 million of regular cash dividends paid during the thirteen weeks ended November 29, 2025, compared to $47.5 million of regular cash dividends paid during the thirteen weeks ended November 30, 2024;

Current wording

•$97.2 million of regular cash dividends paid during the twenty-six weeks ended February 28, 2026, compared to $94.9 million of regular cash dividends paid during the twenty-six weeks ended March 1, 2025;

Previous wording

•net borrowings of $45.0 million under our credit facilities and private placement debt during the thirteen weeks ended November 29, 2025, compared to net borrowings of $11.8 million during the thirteen weeks ended November 30, 2024; and

Current wording

•net borrowings of $25.0 million under our credit facilities and private placement debt during the twenty-six weeks ended February 28, 2026, compared to net borrowings of $30.3 million during the twenty-six weeks ended March 1, 2025; and

Previous wording

•acquisition of the remaining interest of Wm. F. Hurst Co., LLC for $8.2 million during the thirteen weeks ended November 29, 2025, which increased the Company's ownership from 80% to 100%.

Current wording

•acquisition of the remaining interest of Wm. F. Hurst Co., LLC for $8.2 million during the twenty-six weeks ended February 28, 2026, which increased the Company's ownership from 80% to 100%.

Previous wording

In April 2017, the Company entered into a $600.0 million revolving credit facility, which was subsequently amended. Subsequent to the fiscal quarter ended November 29, 2025, the Company made additional net payments through December 19, 2025 of $38.0 million on its revolving credit facility which were funded through the $50.0 million proceeds received in relation to the amendment to our Receivables Purchase Agreement entered into during the second quarter of fiscal year 2026. See Note 6, "Accounts Receivable" in the Notes to Condensed Consolidated Financial Statements for more information about the amendment. The current unused balance of $521.7 million from the revolving credit facility, which is reduced by outstanding letters of credit, is available for working capital purposes if necessary. As of November 29, 2025, the Company also had three uncommitted credit facilities, totaling $230.0 million in aggregate maximum uncommitted availability. As of November 29, 2025, we were in compliance with the operating and financial covenants of our credit facilities. See Note 8, “Debt” in the Notes to Condensed Consolidated Financial Statements for more information about these balances.

Current wording

In April 2017, the Company entered into a $600.0 million revolving credit facility, which was subsequently amended. The current unused balance of $500.7 million from the revolving credit facility, which is reduced by outstanding letters of credit, is available for working capital purposes if necessary. As of February 28, 2026, the Company also had three uncommitted credit facilities, totaling $230.0 million in aggregate maximum uncommitted availability. As of February 28, 2026, we were in compliance with the operating and financial covenants of our credit facilities. See Note 7, “Debt” in the Notes to Condensed Consolidated Financial Statements for more information about these balances.