ARGAN INC

(In thousands, except per share data)

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Dollars in thousands)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

April 30, 2026

(Tabular dollar amounts in thousands, except per share data)

NOTE 1 – DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION

Description of the Business

Argan, Inc. (“Argan”) conducts its construction operations through its wholly-owned subsidiaries across three distinct reportable business segments: Power, Industrial, and Teledata. Argan and these consolidated subsidiaries are hereinafter collectively referred to as the “Company.”

Through the Power segment, the Company provides a full range of engineering, procurement, construction, commissioning, maintenance, project development, and technical consulting services to the power generation market. The customers include primarily independent power producers, public utilities, power plant equipment suppliers and other commercial firms with significant power requirements. Customer projects are located in the United States (the “U.S.”), the Republic of Ireland (“Ireland”) and the United Kingdom (the “U.K.”). The Company’s Industrial segment provides on-site services that support new plant construction and additions for industrial facilities primarily located in the Southeast region of the U.S. The segment also fabricates, delivers, and installs metal components, including piping systems and pressure vessels, and performs maintenance turnarounds, shutdowns, and emergency mobilizations. The Company’s Teledata segment provides project management, construction, installation, maintenance, repair, and emergency response services for power distribution and information, communication, and data networks. The segment’s customers include commercial and industrial organizations, as well as state and federal government agencies, primarily throughout the Mid-Atlantic region of the U.S.

Basis of Presentation and Significant Accounting Policies

The Company’s fiscal year ends on January 31 each year. The condensed consolidated financial statements include the accounts of Argan and its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation.

These condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. The accompanying condensed consolidated financial statements and notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2026 (“Fiscal 2026”).

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments considered necessary for a fair statement of the financial position of the Company as of April 30, 2026, and its earnings and cash flows for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results of operations for any other interim period or for a full fiscal year.

Recently Issued Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03,Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires public business entities to disclose specific information about certain costs and expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effects, if any, that the adoption of ASU 2024-03 may have on its financial position, results of operations, cash flows, or disclosures.

There are no other recently issued accounting pronouncements that have not yet been adopted that the Company considers material to its condensed consolidated financial statements.

NOTE 2 – REVENUES FROM CONTRACTS WITH CUSTOMERS

Disaggregation of Revenues

The following table presents consolidated revenues for the three months ended April 30, 2026 and 2025, disaggregated by the geographic area where the corresponding projects were located:

Revenues for projects located in Ireland and the U.K. are attributed to the Power segment. The major portions of the Company’s consolidated revenues are recognized pursuant to fixed-price contracts with most of the remaining portions earned pursuant to time-and-material contracts. Consolidated revenues are disaggregated by reportable segment in Note 15 to the condensed consolidated financial statements.

Contract Assets and Liabilities

During the three months ended April 30, 2026 and 2025, there were no material unusual or one-time adjustments to contract assets or contract liabilities balances. The Company recognized the following revenues that were included in the contract liabilities balances at the beginning of the respective period:

Contract retentions are billed amounts which, pursuant to the terms of the applicable contract, are not paid by customers until a defined phase of a contract or project has been completed and accepted. These retained amounts are reflected in contract assets or contract liabilities depending on the net contract position of the particular contract. The amounts retained by project owners and other customers under construction contracts as of April 30, 2026 and January 31, 2026 were $69.4 million and $54.5 million, respectively.

Variable Consideration

Variable consideration includes unapproved change orders where the Company has project-owner directive for additional work or other scope changes but has not yet obtained approval for the associated price or the corresponding additional effort. These amounts are included in the transaction price when it is considered probable that the applicable costs, including those for additional effort, will be recovered through a modification to the contract price. As of April 30, 2026 and January 31, 2026, the aggregate amounts of contract variations, which primarily related to an overseas project and were included in the corresponding transaction prices pending customer approvals, were $15.0 million and $11.4 million, respectively.

Remaining Unsatisfied Performance Obligations

As of April 30, 2026, the Company had remaining unsatisfied performance obligations (“RUPO”) of $2.8 billion. The largest portion of RUPO at any date usually relates to engineering, procurement and construction (“EPC”) services and other construction contracts with typical performance durations ofone tofour years. The Company estimates that it will recognize approximately 42% of RUPO as revenue during the next 12 months, with substantially all the remaining performance obligations to be recognized within 12 to 24 months thereafter. It is important to note that estimates may be changed in the future and that cancellations, deferrals or scope adjustments may occur related to work included in the amount of RUPO as of January 31, 2026. Accordingly, RUPO may be adjusted to reflect project delays and cancellations, revisions to project scope and cost and foreign currency exchange fluctuations, or to revise estimates, as effects become known. Such adjustments to RUPO may materially reduce future revenues below Company estimates.

NOTE 3 – CASH, CASH EQUIVALENTS AND INVESTMENTS

Cash Equivalents

As of April 30, 2026 and January 31, 2026, certain amounts of cash equivalents were invested in money market funds with assets invested in high-quality money market instruments, including U.S. Treasury obligations; obligations of U.S. government agencies, authorities, instrumentalities or sponsored enterprises; and repurchase agreements secured by such obligations.

Investments

The Company’s investments consisted of the following as of April 30, 2026 and January 31, 2026:

Short-Term Investments

Short-term investments as of April 30, 2026 and January 31, 2026, consisted solely of certificates of deposit (“CDs”) with remaining maturities ofone year or less purchased from Bank of America, N.A. (the “Bank”). The Company has the intent and ability to hold the CDs until they mature, and they are carried at cost plus accrued interest. The balances of accrued interest on the CDs as of April 30, 2026 and January 31, 2026 were $2.8 million and $1.9 million, respectively.

Available-For-Sale Securities

The Company’s available-for-sale (“AFS”) securities consisted of the following amounts of amortized cost, allowance for credit losses, gross unrealized gains and losses, and estimated fair value by contractual maturity as of April 30, 2026 and January 31, 2026:

As of April 30, 2026 and January 31, 2026, interest receivable in the amounts of $2.9 million and $3.4 million, respectively, were included in the balances of AFS securities. For the three months ended April 30, 2026 and 2025, there wereno sales of the Company’s AFS securities and, therefore, there wereno amounts of gains or losses reclassified out of other comprehensive income into net income.

The Company does not believe the unrealized losses represent credit losses based on the evaluation of evidence as of April 30, 2026, which includes an assessment of whether it is more likely than not that the Company will be required to sell or intends to sell the investments before recovery of their corresponding amortized cost bases.

Earnings on Cash and Invested Funds

The Company earns interest and dividends on its cash equivalents and invested funds. The Company also earns interest on most of its cash balances. Earnings on invested funds and cash account balances for the three months ended April 30, 2026 and 2025 were $8.0 million and $5.5 million, respectively. Earnings on investments are included in other income, net, in the condensed consolidated statements of earnings.

Concentration Risk

The Company has a substantial portion of its cash on deposit in the U.S. with the Bank or invested in CDs purchased from the Bank. In addition, the Company has cash invested in money market funds at separate institutions. The Company maintains certain Euro-based bank accounts in Ireland and certain pound sterling-based bank accounts in the U.K. in support of foreign operations. As of April 30, 2026 and January 31, 2026, approximately 11% and 10%, respectively, of the Company’s cash, cash equivalents, and investments were held by foreign subsidiaries in Ireland and the U.K. Management does not believe that the combined amounts of the CDs and the cash deposited with the Bank, cash invested in money market funds, and cash balances maintained at financial institutions in Ireland and the U.K., in excess of government-insured levels, represent material risks.

NOTE 4 – FAIR VALUE MEASUREMENTS

The following table presents the Company’s financial instruments as of April 30, 2026 and January 31, 2026 that are measured and recorded at fair value on a recurring basis:

NOTE 5 – ACCOUNTS RECEIVABLE

Accounts receivable includes amounts that have been billed and amounts that are billable to customers. As of April 30, 2026 and January 31, 2026, there were billable amounts related to an overseas project in the total amounts of $25.1 million and $25.5 million, respectively, including the expected refund of the letter of credit draw identified in Note 9.

The amounts of the provision for credit losses for the three months ended April 30, 2026 and 2025 were insignificant. The allowances for credit losses as of April 30, 2026 and January 31, 2026 were insignificant.

NOTE 6 – INTANGIBLE ASSETS

The goodwill balances related primarily to the Power and Industrial segments, which were $18.5 million and $9.5 million, respectively, at both April 30, 2026 and January 31, 2026. Management does not believe that any events or circumstances occurred or arose since January 31, 2026, that required an updated assessment of the goodwill balances.

The Company’s intangible assets, other than goodwill, relate primarily to the Industrial segment and consisted of the following as of April 30, 2026 and January 31, 2026:

There wereno additions to intangible assets during the three months ended April 30, 2026 and 2025, nor were there any impairment losses related to intangible assets during these periods. Amortization expense related to intangible assets for the three months ended April 30, 2026 and 2025 were $0.1 million and $0.1 million respectively.

The following is a schedule of future amounts of amortization related to purchased intangibles:

NOTE 7 – FINANCING ARRANGEMENTS

On May 24, 2024, the Company and the Bank executed the Second Amended and Restated Replacement Credit Agreement with an expiration date of May 31, 2027 (the “Credit Agreement”), which was amended on October 23, 2025. The Credit Agreement has a base lending commitment amount of $35.0 million and establishes the interest rate for revolving loans at the Secured Overnight Financing Rate (“SOFR”) plus 1.85%. In addition to the base commitment, the credit facility includes an accordion feature that allows for an additional commitment amount of $30.0 million, subject to certain conditions. The Company may use the borrowing ability to cover other credit instruments issued by the Bank for the Company’s use in the ordinary course of business as defined in the Credit Agreement. Further, on May 31, 2024, the Company entered into a companion facility, in the amount of $25.0 million, pursuant to which an overseas subsidiary of the Company may cause the Bank’s European entity to issue letters of credit on its behalf that will be secured by a blanket parent company guarantee that was issued by Argan to the Bank.

As of April 30, 2026 and January 31, 2026, the Company did not have any borrowings outstanding under the Credit Agreement. However, the Bank has issued a letter of credit in the outstanding amount of $0.5 million as of April 30, 2026. As of January 31, 2026, the outstanding total amount of letters of credit was $0.3 million.

The Company has pledged most of its assets to secure its financing arrangements. The Bank’s consent is not required for acquisitions, divestitures, cash dividends or significant investments as long as certain conditions are met. The Credit Agreement requires that the Company comply with certain financial covenants at its fiscal year-end and at each fiscal quarter-end. The Credit Agreement includes other terms, covenants and events of default that are customary for a credit facility of its size and nature, including a requirement to achieve positive adjusted earnings before interest, taxes, depreciation, and amortization, as defined, over each rolling twelve-month measurement period. As of April 30, 2026, the Company was in compliance with the covenants and other requirements of the Credit Agreement.

NOTE 8 – COMMITMENTS

As of April 30, 2026, the estimated amount of the Company’s unsatisfied bonded performance obligations, covering all of its subsidiaries, was approximately $1.0 billion. As of April 30, 2026, the outstanding amount of bonds covering other risks, including warranty obligations and contract payment retentions related to completed activities, was $37.9 million.

NOTE 9 – LEGAL CONTINGENCIES

In the normal course of business, the Company may have pending claims and legal proceedings. The Company maintains accrued expense balances for the estimated amounts of legal costs expected to be billed related to any significant matter. In the opinion of management, based on information available at this time, there are no current claims and proceedings that would have a material adverse effect on the consolidated financial statements. However, the outcomes of such legal claims and proceedings are subject to inherent uncertainties.

In March 2025, the U.K. subsidiary of the Company sued EP NI Energy Limited and EP UK Investment Limited (together referred to as “EP”) in the High Court of Justice, Business and Property Courts of England and Wales for EP’s breach of contract and failure to remedy various events which negatively impacted the schedule and costs of an overseas project, resulting in EP receiving the benefits of the construction efforts of the Company’s U.K. subsidiary and the corresponding progress on the project without making payments to which the Company’s U.K. subsidiary was contractually entitled. The Company’s U.K. subsidiary provided the project owner notice to terminate because of project owner breaches of the contract. Those breaches were not resolved, as a result of which the contract terminated on May 3, 2024. Subsequently, the project owner made a draw for the full amount of a $9.9 million irrevocable letter of credit, or on-demand performance bond, issued by the Company’s bank. The Company believes the project owner improperly initiated the draw on the bond and, therefore, the amount should be refunded. This amount is included in accounts receivable as of April 30, 2026. The Company’s U.K. subsidiary has significant billable receivables, unresolved contract variations and claims for extensions of time, among other issues, related to this overseas project. The project owner has asserted counterclaims that the Company’s U.K. subsidiary disputes. The Company’s U.K. subsidiary will vigorously assert its rights and claims to recover its lost value and collect any remaining monies owed.

NOTE 10 – STOCK-BASED COMPENSATION

Stock-based compensation expense amounts for the three months ended April 30, 2026 and 2025 were $2.0 million and $1.2 million, respectively. As of April 30, 2026, there was $18.7 million in unrecognized compensation costs related to outstanding stock awards that the Company expects to recognize over the next three years.

During the three months ended April 30, 2026, the Company awarded performance-based restricted stock units covering a target of 596 shares of common stock, earnings per share performance-based restricted stock units covering a target of 12,583 shares of common stock, and time-based restricted stock units covering 10,701 shares of common stock. The number of shares of common stock to be issued under certain awards may exceed the number of target shares if certain performance goals are exceeded. The changes in the maximum number of shares of common stock issuable pursuant to outstanding restricted stock units for the three months ended April 30, 2026 are presented below (shares in thousands):

During the three months ended April 30, 2026, the Company awarded nonqualified stock options to purchase 955 shares of common stock at a weighted-average exercise price per share of $588.28. During the three months ended April 30, 2026, nonqualified stock options to purchase 30,568 shares of common stock were exercised at a weighted-average exercise price per share of $39.80. As of April 30, 2026, there were 48,454 nonqualified stock options outstanding.

Shares Withheld and Treasury Stock

For the three months ended April 30, 2026 and 2025, the Company used 76,165 shares and 59,472 shares of treasury stock, respectively, to settle stock option exercises and other share-based awards. For the three months ended April 30, 2026, the Company withheld 41,115 shares of common stock at the average price per share of $605.78 for the exercise price and/or tax withholding in connection with stock option exercises and other share-based award settlements. For the three months

ended April 30, 2025, the Company withheld 44,669 shares of common stock at the average price per share of $146.41 for the exercise price and/or tax withholding in connection with stock option exercises and other share-based award settlements.

NOTE 11 – PROVISION FOR INCOME TAXES

The Company’s effective income tax rate (“ETR”) for the three months ended April 30, 2026 and 2025 was 14.3% and 24.3%, respectively. The Company’s ETR for the three months ended April 30, 2026 differed from the U.S. federal statutory rate of 21% primarily due to stock-based compensation windfall. The Company’s ETR for the three months ended April 30, 2025 differed from the U.S. federal statutory rate primarily due to the unfavorable effects of state income taxes.

For the three months ended April 30, 2026 and 2025, the amount of cash paid for income taxes, net of refunds received, was insignificant.

Solar Energy Projects

The Company holds equity investments in Solar Tax Credit (“STC”) investments. Primarily, the STC investments are structured as limited liability companies that invest in solar energy projects that are eligible to receive energy tax credits. As of April 30, 2026 and January 31, 2026, the investment accounts balances were $1.5 million and $1.7 million, respectively, which are included in other assets in the condensed consolidated balance sheets. As of April 30, 2026, we had no remaining cash investment commitments related to the STC investments. These investments are expected to provide positive overall returns over their expected lives.

The Company has STC investments that qualify for the proportional amortization method (“PAM”). For these investments, the Company recognized income tax credits and other income tax benefits of less than $0.1 million and $0.8 million during the three months ended April 30, 2026 and 2025, respectively. For the three months ended April 30, 2026 and 2025, the Company recorded amortization related to STC investments of less than $0.1 million and $0.7 million, respectively. The amount of non-income tax related activity and other returns related to the STC investments that qualify for PAM were not material for the three months ended April 30, 2026 and 2025.

For the three months ended April 30, 2026 and 2025, the Company’s share of activity from its STC investments that do not qualify for PAM was not material.

NOTE 12 – EARNINGS PER SHARE

Potentially dilutive securities include stock options and restricted stock units. Diluted earnings per share include only securities that are actually dilutive. Basic and diluted earnings per share are computed as follows (in thousands, except per share data):

NOTE 13 – STOCKHOLDERS’ EQUITY

During the three months ended April 30, 2026 and during Fiscal 2026, the Company paid dividends to stockholders as follows:

On April 8, 2026, the board of directors of Argan increased the total authorization to repurchase shares of the Company’s common stock by $50 million, bringing the aggregate authorized amount to $200 million. Pursuant to its established program and authorizations provided by Argan’s board of directors, the Company repurchased shares of its common stock during the three months ended April 30, 2026 and 2025 and added the shares to treasury stock. During these periods, the Company repurchased 6,450 shares and 55,117 shares of common stock, all on the open market, for aggregate prices of approximately $3.0 million, or $458.21 per share, and $6.8 million, or $124.25 per share, respectively.

NOTE 14 – CUSTOMER CONCENTRATIONS

Most of the Company’s consolidated revenues relate to performance by the Power segment. The following schedule presents the percentage of consolidated revenues for each reportable segment for the respective periods:

The Company’s most significant customer relationships for the three months ended April 30, 2026 included three Power customers, which accounted for 15%,13%, and 12% of consolidated revenues. The Company’s most significant customer relationships for the three months ended April 30, 2025 includedtwo Power customers, which accounted for 30% and 25% of consolidated revenues.

The accounts receivable balances from five major customers represented 19%,16%,13%,11%, and 11% of the corresponding consolidated balance as of April 30, 2026. The accounts receivable balances from three major customers represented 29%,19%, and 11% of the corresponding consolidated balance as of January 31, 2026.

The contract asset balances attributable tothree major customers represented 22%,22%, and 12% of the corresponding consolidated balance as of April 30, 2026, and the contract asset balances attributable tothree major customers represented 23%,22%, and 19% of the corresponding consolidated balance as of January 31, 2026.

NOTE 15 – SEGMENT REPORTING

Segments represent components of an enterprise for which discrete financial information is available that is evaluated regularly by the Company’s chief executive officer, who is the Company’s chief operating decision maker (the “CODM”), in determining how to allocate resources and in assessing performance. The CODM primarily uses income before income taxes to assess the performance of the Company’s business segments and to make resource allocation determinations. The CODM may also use gross profit and income from operations as supplemental measures when assessing segment performance.

The Company’s reportable segments recognize revenues and incur expenses and are organized as separate business units, each with distinct management teams, customers, talent pools, and service offerings. The Company’s reportable segments may include more than one operating segment.

Intersegment revenues and the related cost of revenues are netted against the corresponding amounts of the segment receiving the intersegment services. For the three months ended April 30, 2026 and 2025, intersegment revenues were $0.4 million and $1.9 million, respectively. Intersegment revenues for the three months ended April 30, 2026, primarily reflected services provided by the Teledata segment to the Industrial segment, and intersegment revenues for the three months ended April 30, 2025, primarily reflected services provided by the Industrial segment to the Power segment. Pricing for intersegment services is established based on the amounts negotiated between the respective parties.

Summarized below are certain operating results and financial position data of the Company’s reportable segments for the three months ended April 30, 2026 and 2025. Selling, general and administrative expenses include compensation and benefits, professional fees, information technology, insurance premiums, rent, business development, and amortization and depreciation expenses incurred directly by each segment. Other income, net, primarily includes earnings on invested funds. Corporate net expenses consist of corporate overhead costs, offset by earnings on cash and invested funds. Corporate current assets primarily consist of cash, cash equivalents, and income-tax related assets.

NOTE 16 — SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION

Other current assets consisted of the following as of April 30, 2026 and January 31, 2026:

Accrued expenses consisted of the following as of April 30, 2026 and January 31, 2026: