LUXFER HOLDINGS PLC

Previous wording

This Interim Report on Form 10-Q contains certain statements, statistics and projections that are, or may be, forward-looking. These forward-looking statements are subject to known and unknown risks, uncertainties, assumptions and other factors that could cause our actual results of operations, financial condition, liquidity, performance, prospects, opportunities, achievements or industry results, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. The accuracy and completeness of all such statements, including, without limitation, statements regarding our future financial position, strategy, plans and objectives for the management of future operations, is not warranted or guaranteed. These statements typically contain words such as "believes," "intends," "expects," "anticipates," "estimates," "may," "will," "should" and words of similar import. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Although we believe that the expectations reflected in such statements are reasonable, no assurance can be given that such expectations will prove to be correct. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. These factors include, but are not limited to, factors identified in "Business," "Risk factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations," or elsewhere in this Annual Report, as well as:

Current wording

This Interim Report on Form 10-Q contains certain statements, statistics and projections that are, or may be, forward-looking. These forward-looking statements are subject to known and unknown risks, uncertainties, assumptions and other factors that could cause our actual results of operations, financial condition, liquidity, performance, prospects, opportunities, achievements or industry results, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. The accuracy and completeness of all such statements, including, without limitation, statements regarding our future financial position, strategy, plans and objectives for the management of future operations, is not warranted or guaranteed. These statements typically contain words such as "believes," "intends," "expects," "anticipates," "estimates," "may," "will," "should" and words of similar import. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Although we believe that the expectations reflected in such statements are reasonable, no assurance can be given that such expectations will prove to be correct. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. These factors include, but are not limited to, factors identified in "Business," "Risk factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations," or elsewhere in this Interim Report, as well as:

Previous wording

•potential or actual incremental tariffs, and other political risks worldwide;

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•potential or actual tariffs, and other political risks worldwide;

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•the amount of indebtedness we have incurred and may incur, and the obligations to service such indebtedness and to comply with the covenants contained therein; • relationships with our customers and suppliers;

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•the amount of indebtedness we have incurred and may incur, and the obligations to service such indebtedness and to comply with the covenants contained therein;

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•regulatory, environmental, legislative and judicial developments; and

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•regulatory, environmental, legislative and judicial developments; and • our intention to pay dividends.

Previous wording

Luxfer Holdings PLC ("Luxfer," "the Company," "we," "our") is a global industrial company innovating niche applications in materials engineering. Luxfer focuses on value creation by using its broad array of technical know-how and proprietary technologies to help create a safe, clean and energy-efficient world. Luxfer's high-performance materials, components and high-pressure gas containment devices are used in defense, first response and healthcare, transportation and general industrial applications.

Current wording

Luxfer Holdings PLC ("Luxfer," "the Company," "we," "our") is a global industrial company innovating niche applications in materials engineering. Luxfer focuses on value creation by using its broad array of technical know-how and proprietary technologies to help create a safe, clean and energy-efficient world. Luxfer's high performance materials, components and high-pressure gas containment devices are used in defense, first response and healthcare, transportation and specialty industrial applications.

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Key trends and uncertainties regarding our existing business

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Key trends regarding our existing business

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•Continued emphasis on operating cash generation and maintaining strong working capital performance;

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•Continued emphasis on operating cash generation and maintaining strong working capital performance; and

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The consolidated results of operations for the First Quarter of 2025 and 2024 of Luxfer were as follows:

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The consolidated results of operations for the second quarter of 2025 and 2024 of Luxfer were as follows:

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Adjusting for foreign exchange headwinds of $0.3 million, net sales have increased by 8.8% in the First Quarter of 2025. Sales were positively impacted in the quarter from:

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Revenue was positively impacted in the quarter from:

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•Increased sales of MREs and Group Rations (UGR-E) in our Magtech division;

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•Significant increase in sales of Meals Ready to Eat (MREs) and Group Rations (UGR-E);

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The 1.5 percentage point increase in gross profit as a percentage of sales in the First Quarter of 2025 from 2024 was primarily the result of the positive sales mix and contract resets, partially offset by raw material re-pricing in our Elektron division.

Current wording

The 1.0 and 1.2 percentage point increase in gross profit as a percentage of sales in the second quarter and first six months of 2025 from 2024 was primarily the result of positive sales mix and continued operational execution across end markets. 2025 has also benefited from contract resets, partially offset by raw material re-pricing in our Elektron division.

Previous wording

The $0.7 million restructuring charge in the First Quarter of 2024, predominantly relates to costs incurred in respect of cost savings initiatives affecting our North American Gas Cylinders business ($0.4 million) and clean up costs of $0.2 million in relation to the consolidation of production facilities in the Magnesium Powders operations. There was a further $0.1 million relating to costs associated with the closure of Luxfer Gas Cylinders France.

Current wording

The $1.1 million and $1.8 million restructuring charge in the second quarter and first six months of 2024 predominantly relates to the execution of cost savings initiatives affecting our North American Gas Cylinders business. This amounted to $0.6 million and $1.0 million in the second quarter and first six months of the year respectively. There was a further $0.5 million and $0.6 million in the second quarter and first six months of the year primarily relating to site clean-up costs associated with the closure of Luxfer Gas Cylinders France, which ceased operations in 2019. Additionally, there were clean-up costs of $0.2 million in the first six months of the year within our Elektron Division relating to the consolidation of production facilities in the Magnesium Powders operations.

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In 2025 there was a defined benefit credit of $0.6 million for the U.K. plan, which increased from $0.3 million in 2024 as a result of the triennial valuation in 2024.

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There was a defined benefit credit of $0.6 million and $1.2 million in the second quarter and first six months respectively for the U.K. plan, an improvement from 2024 as a result of the triennial valuation in 2024.

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The movement in the statutory effective tax rate from 26.3% in 2024, to 25.7% in 2025, was primarily due to non-deductible expenses and deferred tax credit. When stripping out the impact of adjusting items, the adjusted effective tax rate has increased to 23.8% in 2025 from 23.1% in 2024.

Current wording

The movement in the year to date statutory effective tax rate from 63.1% in 2024, to 29.1% in 2025, was primarily due to non-deductible expenses, predominantly in relation to the previously mentioned loss on assets held for sale and accelerated depreciation charges. When stripping out the impact of this, as well as other less significant adjusting items, the adjusted effective tax rate has increased to 23.9% in 2025 from 23.7% in 2024.

Previous wording

The following tables of non-GAAP summary financial data presents a reconciliation of net income from continuing operations and diluted earnings per ordinary share from continuing operations to adjusted net income from continuing operations, adjusted EBITA from continuing operations, adjusted income from continuing operations before income taxes, adjusted EBITDA from continuing operations, adjusted EBITDA excluding legal cost recovery, adjusted earnings per ordinary share from continuing operations, adjusted provision for income taxes and adjusted effective tax rate from continuing operations, for the periods presented, being the most comparable GAAP measures. Management believes that adjusted net income excluding legal cost recovery, adjusted earnings per share, adjusted EBITA and adjusted EBITDA excluding legal cost recovery are key performance indicators ("KPIs") used by the investment community and that such presentation will enhance an investor’s understanding of the Company's operational results. In addition, Luxfer's CEO and other senior management use these KPIs, among others, to evaluate business performance. However, investors should not consider adjusted net income from continuing operations, adjusted earnings per share from continuing operations, adjusted EBITA from continuing operations and adjusted EBITDA excluding legal cost (recovery) from continuing operations in isolation as an alternative to net income and earnings per share when evaluating Luxfer's operating performance or measuring Luxfer's profitability. In 2024, the Company initiated a process to divest the Graphic Arts business. While Graphic Arts does not meet the 'strategic shift' criteria outlined in ASC 205-20 for it to be classified as a discontinued operation, we believe that given the expectation that divestiture will be completed in the current year, it is appropriate in the tables below to separate out the results of Graphic Arts in order to provide a more complete financial summary for the period. Similarly for other Income of $0.2 million in the First Quarter of 2024 relates to the recovery of legal costs from our insurer related to the previously disclosed US Ecology case, historically the legal costs relating to this case were in selling, general and administrative expenses, however the other income in the First Quarter of 2024 is separated due to its one-off nature and the recovery relating to several years. We believe separating the income and costs relating to this is also appropriate to provide a more complete financial summary for the period.

Current wording

The following tables of non-GAAP summary financial data presents a reconciliation of net income from continuing operations and diluted earnings per ordinary share from continuing operations to adjusted net income from continuing operations, adjusted EBITA from continuing operations, adjusted income from continuing operations before income taxes, adjusted EBITDA from continuing operations, adjusted EBITDA excluding legal cost recovery, adjusted earnings per ordinary share from continuing operations, adjusted provision for income taxes and adjusted effective tax rate from continuing operations, for the periods presented, being the most comparable GAAP measures. Management believes that adjusted net income excluding legal cost recovery, adjusted earnings per share, adjusted EBITA and adjusted EBITDA excluding legal cost recovery are key performance indicators ("KPIs") used by the investment community and that such presentation will enhance an investor’s understanding of the Company's operational results. In addition, Luxfer's CEO and other senior management use these KPIs, among others, to evaluate business performance. However, investors should not consider adjusted net income from continuing operations, adjusted earnings per share from continuing operations, adjusted EBITA from continuing operations and adjusted EBITDA excluding legal cost (recovery) from continuing operations in isolation as an alternative to net income and earnings per share when evaluating Luxfer's operating performance or measuring Luxfer's profitability. In 2024, the Company initiated a process to divest the Graphic Arts business. While Graphic Arts does not meet the 'strategic shift' criteria outlined in ASC 205-20 for it to be classified as a discontinued operation, given that the divestiture will be completed in the current year, it is appropriate in the tables below to separate out the results of Graphic Arts in order to provide a more complete financial summary for the period. Similarly other income of $5.3 million in the first six months of 2024 relates to the recovery of legal costs from our insurer related to the previously disclosed US Ecology case, historically the legal costs relating to this case were in selling, general and administrative expenses, however the other income in the first six months of 2024 is separated due to its one-off nature and the recovery relating to several years. We believe separating the income and costs relating to this is also appropriate to provide a more complete financial summary for the period.

Previous wording

Adjusted EBITA, which is our segment income metric, represents net income from continuing operations adjusted for share-based compensation charges, restructuring charges, impairment charges, other charges, acquisitions and disposals costs, net interest expenses, defined benefits pension credit, provision for taxes and amortization. A reconciliation to pre-tax income can be found in Note 15 to the condensed consolidated financial statements. Adjusted EBITDA, as shown below, represents adjusted EBITA less depreciation. Management believes that adjusted EBITA and adjusted EBITDA are key performance indicators ("KPIs") used by the investment community and that such presentation will enhance an investor’s understanding of the Company's operational results. Adjusted EBITDA is reconciled to adjusted EBITA above.

Current wording

Adjusted EBITA, which is our segment income metric, represents net income from continuing operations adjusted for share-based compensation charges, restructuring charges, impairment charges, acquisitions and disposals costs, net interest expenses, defined benefits pension credit, provision for taxes and amortization. A reconciliation to pre-tax income can be found in Note 15 to the condensed consolidated financial statements. Adjusted EBITDA, as shown below, represents adjusted EBITA less depreciation. Management believes that adjusted EBITA and adjusted EBITDA are key performance indicators ("KPIs") used by the investment community and that such presentation will enhance an investor’s understanding of the Company's operational results. Adjusted EBITDA is reconciled to adjusted EBITA above.

Previous wording

The 9.5% decrease in Gas Cylinders sales in the First Quarter of 2025 from 2024 was primarily the result of:

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The 5.6% and 7.5% decrease in Gas Cylinders sales in the second quarter and first six months of 2025 from 2024 was primarily the result of:

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•Reduction in Alternative Fuel ("AF") cylinder sales;

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•Continued softness in demand for Alternative Fuel ("AF") cylinder sales in both North America and Europe;

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The 2.7 percentage point decrease in adjusted EBITDA for Gas Cylinders as a percentage of net sales in the First Quarter of 2025 relative to 2024 is the result of the decrease in adjusted EBITA as a percentage of net sales.

Current wording

The 0.5 percentage point increase in adjusted EBITA for Gas Cylinders as a percentage of net sales in the second quarter of 2025 relative to 2024 is predominantly the result of pricing discipline and cost control. For the first six months there has been a 1.1 percentage point decrease in adjusted EBITA, predominantly the result of adverse sales mix partially offset by price and a foreign exchange tailwind.

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The 31.0% increase in Elektron sales in the First Quarter of 2025 from 2024 was primarily the result of:

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The 19.3% increase in Elektron sales in the second quarter of 2025 from 2024 was primarily the result of:

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The 3.2% increase in Graphic Arts sales in the First Quarter of 2025 from 2024 was primarily the result of increased demand for photo-engraving plates.

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The 12.7% decrease in Graphic Arts sales in the second quarter of 2025 from 2024 was primarily the result of decreased demand for photo-engraving plates. This was the same for the 5.6% decrease in the first six months of 2025 from 2024

Previous wording

We believe that, in the long term, cash generated from our operations will be adequate to meet our anticipated requirements for working capital, capital expenditures and interest payments on our indebtedness. In the short term, we believe we have sufficient credit facilities to cover any variation in our cash flow generation. However, any major repayments of indebtedness will be dependent on our ability to raise alternative financing or to realize substantial returns from operational sales. Also, our ability to expand operations through sales development and capital expenditures could be constrained by the availability of liquidity, which, in turn, could impact the profitability of our operations.

Current wording

We believe that, in the long term, cash generated from our operations will be adequate to meet our anticipated requirements for working capital, capital expenditures and interest payments on our indebtedness. In the short term, we believe we have sufficient credit facilities to cover any variation in our cash flow generation. However, any major repayments of indebtedness will be dependent on our ability to raise alternative financing or to realize substantial returns from operational sales, in July 2025 we completed a refinance of our shelf facility, the terms of this remaining the same, with expiry now in July 2030. Our ability to expand operations through sales development and capital expenditures could be constrained by the availability of liquidity, which, in turn, could impact the profitability of our operations.

Previous wording

Cash provided by continuing operating activities was $5.2 million for the First Quarter of 2025 compared to $3.6 million in the First Quarter of 2024. It was primarily related to net income from operating activities offset by movements in working capital, and net of the following non-cash items: depreciation and amortization; share-based compensation charges; pension credit and net changes to assets and liabilities.

Current wording

Cash generated by operating activities was $6.4 million inflow and $12.5 million inflow for the first six months in 2025 and 2024 respectively. It was primarily related to net income from operating activities, net decreases in working capital, and net of the following non-cash items: depreciation and amortization; share-based compensation charges; pension credit; loss on held-for-sale asset group and net changes to assets and liabilities. Cash flow in 2024 was impacted by the $4.5 million receipt arising from the reimbursement of legal costs in relation to the previously disclosed US Ecology case.

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Net cash used by continuing investing activities was $1.2 million for the First Quarter of 2025, compared to $1.4 million in 2024, as a result of reduced capital expenditure in the quarter.

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Net cash used by investing activities was $3.1 million for the first six months of 2025, compared to net cash used by investing activities of $4.1 million in 2024, as a result of reduced capital expenditure in the quarter.

Previous wording

In the First Quarter of 2025, net cash used by continuing financing activities was $4.2 million, compared to $2.3 million provided by financing activities in 2024. We made net repayment of our overdraft facility of $2.0 million (2024: $4.3), net drawdown on our banking facilities of $2.2 million (2024: $10.6 million) and dividend payments of $3.5 million (2024: $3.5 million), equating to $0.13 per ordinary share respectively. In addition, we paid out $0.4 million (2024: $0.1 million) in settling share based compensation and $0.5 million (2024: $0.4 million) in repurchasing our own shares as part of the share buyback program, which equates to 40,000 shares (2024: 20,000 shares).

Current wording

In the first six months of 2025, net cash used by financing activities was $3.2 million, (2024: $6.3 million used by financing activities). We made a net drawdown on our banking facilities of $5.5 million, having drawn $4.9 million on our revolving credit facility and $0.6 million of short term debt (2024: $2.0 million drawdown). Dividend payments of $7.0 million (2024: $7.0 million), equating to $0.26 per ordinary share respectively and we paid out $0.6 million, (2024: $0.3 million) in settling share based compensation and $1.1 million, (2024: $1.0 million) in repurchasing our own shares as part of the share buyback program which equates to 90,000 shares (2024: 100,000 shares).

Previous wording

Any payment of dividends is also subject to the provisions of the U.K. Companies Act, according to which dividends may only be paid out of profits available for distribution determined by reference to financial statements prepared in accordance with the Companies Act and U.K.-adopted International Accounting Standards, which differ in some respects from GAAP. In the event that dividends are paid in the future, holders of the ordinary shares will be entitled to receive payments in U.S. dollars in respect of dividends on the underlying ordinary shares in accordance with the deposit agreement. Furthermore, because we are a holding company, any dividend payments would depend on cash flows from our subsidiaries.

Current wording

Any payment of dividends is also subject to the provisions of the U.K. Companies Act, according to which dividends may only be paid out of profits available for distribution determined by reference to financial statements prepared in accordance with the Companies Act and IFRS as adopted by the E.U., which differ in some respects from GAAP. In the event that dividends are paid in the future, holders of the ordinary shares will be entitled to receive payments in U.S. dollars in respect of dividends on the underlying ordinary shares in accordance with the deposit agreement. Furthermore, because we are a holding company, any dividend payments would depend on cash flows from our subsidiaries.

Previous wording

We have adopted various accounting policies to prepare the consolidated financial statements in accordance with GAAP. Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. In our 2024 Annual Report on Form 10-K, filed with the SEC on February 25, 2025, we identified the critical accounting policies which affect our more significant estimates and assumptions used in preparing our consolidated financial statements.

Current wording

We have adopted various accounting policies to prepare the consolidated financial statements in accordance with GAAP. Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. In our 2024 Annual Report on Form 10K, filed with the SEC on February 25, 2025, we identified the critical accounting policies which affect our more significant estimates and assumptions used in preparing our consolidated financial statements.