ESCO TECHNOLOGIES INC

Previous wording

The following discussion refers to the Company’s results from continuing operations, except where noted. References to the second quarters of 2026 and 2025 represent the three-month periods ended March 31, 2026 and 2025, respectively.

Current wording

The following discussion refers to the Company’s results from continuing operations, except where noted. References to the third quarters of 2026 and 2025 represent the three-month periods ended June 30, 2026 and 2025, respectively.

Previous wording

In the second quarter of 2026, sales, net earnings and diluted earnings per share were $309.3 million, $33.6 million and $1.29 per share, respectively, compared to $231.8 million, $26.4 million and $1.02 per share, respectively, in the second quarter of 2025. In the first six months of 2026, sales, net earnings and diluted earnings per share were $599.0 million, $62.2 million and $2.40 per share, respectively, compared to $446.4 million, $46.7 million and $1.81 per share, respectively, in the first six months of 2025.

Current wording

In the third quarter of 2026, sales, net earnings and diluted earnings per share from continuing operations were $339.0 million, $32.7 million and $1.26 per share, respectively, compared to $296.3 million, $24.8 million and $0.96 per share, respectively, in the third quarter of 2025. In the first nine months of 2026, sales, net earnings and diluted earnings per share were $938.0 million, $95.0 million and $3.66 per share, respectively, compared to $742.7 million, $71.4 million and $2.76 per share, respectively, in the first nine months of 2025.

Previous wording

In the second quarter of 2026, net sales of $150.3 million were $60.7 million, or 67.7%, higher than the $89.6 million in the second quarter of 2025. In the first six months of 2026, net sales of $294.1 million were $122.6 million, or 71.5%, higher than the $171.5 million in the first six months of 2025. The sales increase in the second quarter of 2026 compared to the second quarter of 2025 was mainly due to a $44.3 million increase in navy revenues and a $14.0 million increase in aerospace revenues (defense and commercial). Maritime contributed $47.8 million of revenue growth in the second quarter of 2026. The sales increase in the first six months of 2026 compared to the first six months of 2025 was mainly due to a $88.5 million increase in navy revenues, a $29.8 million increase in aerospace revenues (defense and commercial) and a $3.3 million increase in industrial shipments. Maritime contributed $98.4 million of revenue growth in the first six months of 2026.

Current wording

In the third quarter of 2026, net sales of $168.2 million were $31.9 million, or 23.4%, higher than the $136.3 million in the third quarter of 2025. In the first nine months of 2026, net sales of $462.3 million were $154.5 million, or 50.2%, higher than the $307.8 million in the first nine months of 2025. The sales increase in the third quarter of 2026 compared to the third quarter of 2025 was mainly due to a $22.3 million increase in navy revenues and a $7.9 million increase in aerospace revenues (defense and commercial). Maritime contributed $22.7 million of revenue growth in the third quarter of 2026. The sales increase in the first nine months of 2026 compared to the first nine months of 2025 was mainly due to a $110.9 million increase in navy revenues and a $37.7 million increase in aerospace revenues (defense and commercial). Maritime contributed $121.1 million of revenue growth in the first nine months of 2026.

Previous wording

In the second quarter of 2026, net sales of $93.5 million were $2.7 million, or 3.0%, higher than the $90.8 million in the second quarter of 2025. In the first six months of 2026, net sales of $181.0 million were $3.6 million, or 2.0%, higher than the $177.4 million in the first six months of 2025. The increase in the second quarter of 2026 compared to the second quarter of 2025 was due to an $8.4 million increase in net sales at Doble driven by higher sales of protection testing, offline products and services, partially offset by a $5.7 million decrease in net sales at NRG driven by lower shipments of solar and wind products due to weakness in the renewables market. The increase in the first six months of 2026 compared to the corresponding period of 2025 was due to a $12.5 million increase in net sales at Doble driven by higher sales of condition monitoring and offline products, partially offset by an $8.9 million decrease in net sales at NRG for the reasons mentioned above.

Current wording

In the third quarter of 2026, net sales of $100.0 million were $7.6 million, or 8.2%, higher than the $92.4 million in the third quarter of 2025. In the first nine months of 2026, net sales of $281.0 million were $11.2 million, or 4.2%, higher than the $269.8 million in the first nine months of 2025. The increase in the third quarter of 2026 compared to the third quarter of 2025 was due to an $12.9 million increase in net sales at Doble driven by higher sales of protection testing, offline test equipment and services, partially offset by a $5.3 million decrease in net sales at NRG driven by lower shipments of solar and wind products due to weakness in the renewables market. The increase in the first nine months of 2026 compared to the corresponding period of 2025 was due to a $25.5 million increase in net sales at Doble driven by higher sales of condition monitoring, offline, protection testing products and services, partially offset by a $14.3 million decrease in net sales at NRG for the reasons mentioned above.

Previous wording

In the second quarter of 2026, net sales of $65.5 million were $14.1 million, or 27.4%, higher than the $51.4 million in the second quarter of 2025. In the first six months of 2026, net sales of $123.8 million were $26.4 million, or 27.1%, higher than the $97.4 million in the first six months of 2025. The increase in the second quarter of 2026 as compared to the second quarter of 2025 was due to a $10.1 million increase in sales from the segment’s U.S. operations, a $2.8 million increase in sales from the segment’s Asian operations, and a $1.2 million increase from the segment’s European operations; due to higher Test and Measurement and filters volumes. The increase in the first six months of 2026 compared to the first six months of 2025 was due to a $20.2 million increase in sales from the segment’s U.S. operations, a $4.2 million increase from the segment’s European operations and a $2.0 million increase in sales from the segment’s Asian operations for the reasons mentioned above.

Current wording

In the third quarter of 2026, net sales of $70.9 million were $3.2 million, or 4.7%, higher than the $67.7 million in the third quarter of 2025. In the first nine months of 2026, net sales of $194.7 million were $29.6 million, or 17.9%, higher than the $165.1 million in the first nine months of 2025. The increase in the third quarter of 2026 as compared to the third quarter of 2025 was due to a $7.1 million increase in sales from the segment’s U.S. and European operations due to higher Test and Measurement, medical and industrial shielding, and filters volumes, partially offset by a $3.9 million decrease from the segment’s Asian operations. The increase in the first nine months of 2026 compared to the first nine months of 2025 was due to a $27.2 million increase in sales from the segment’s U.S. operations, a $4.3 million increase from the segment’s European operations for the reasons mentioned above, partially offset by a $1.9 million decrease in sales from the segment’s Asian operations.

Previous wording

Backlog was $1,470.0 million at March 31, 2026 compared with $1,133.6 million at September 30, 2025. The Company received new orders totaling $378.2 million in the second quarter of 2026 compared to $265.7 million in the second quarter of 2025. Of the new orders received in the second quarter of 2026, $183.8 million related to A&D products, $101.3 million related to USG products, and $93.1 million related to Test products. Of the new orders received in the second quarter of 2025, $96.5 million related to A&D products, $92.2 million related to USG products, and $77.0 million related to Test products.

Current wording

Backlog was $1,540.5 million at June 30, 2026 compared with $1,133.6 million at September 30, 2025. The Company received new orders totaling $409.5 million in the third quarter of 2026 compared to $749.1 million in the third quarter of 2025. Of the new orders received in the third quarter of 2026, $195.6 million related to A&D products, $126.9 million related to USG products, and $87.0 million related to Test products. Of the new orders received in the third quarter of 2025, $582.4 million related to A&D products (including $364.2 million of Maritime acquired backlog), $105.5 million related to USG products, and $61.2 million related to Test products.

Previous wording

The Company received new orders totaling $935.4 million in the first six months of 2026 compared to $494.9 million in the first six months of 2025. Of the new orders received in the first six months of 2026, $566.1 million related to A&D products, $200.1 million related to USG products, and $169.2 million related to Test products. Of the new orders received in the first six months of 2025, $171.3 million related to A&D products, $181.8 million related to USG products, and $141.8 million related to Test products.

Current wording

The Company received new orders totaling $1,344.9 million in the first nine months of 2026 compared to $1,243.9 million in the first nine months of 2025. Of the new orders received in the first nine months of 2026, $761.8 million related to A&D products, $326.9 million related to USG products, and $256.2 million related to Test products. Of the new orders received in the first nine months of 2025, $753.7 million related to A&D products (including $364.2 million of Maritime acquired backlog), $287.3 million related to USG products, and $202.9 million related to Test products.

Previous wording

Selling, general and administrative (SG&A) expenses for the second quarter of 2026 were $62.8 million (20.3% of net sales), compared with $54.3 million (23.4% of net sales) for the second quarter of 2025. For the first six months of 2026, SG&A expenses were $124.0 million (20.7% of net sales) compared to $109.3 million (24.5% of net sales) for the first six months of 2025. The increase in SG&A in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly due to an increase within the A&D segment due to the Maritime acquisition; increased expenses at all three business segments primarily related to higher sales and inflationary impacts and an increase at Corporate mainly due to acquisition costs. SG&A as a percentage of net sales decreased in the second quarter and first six months of 2026 within all three business segments.

Current wording

Selling, general and administrative (SG&A) expenses for the third quarter of 2026 were $71.0 million (20.9% of net sales), compared with $62.0 million (20.9% of net sales) for the third quarter of 2025. For the first nine months of 2026, SG&A expenses were $195.0 million (20.8% of net sales) compared to $171.3 million (23.1% of net sales) for the first nine months of 2025. The increase in SG&A in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly due to an increase within the A&D segment due to the Maritime acquisition; increased expenses at all three business segments primarily related to higher sales and inflationary impacts and an increase at Corporate mainly due to acquisition costs related to the pending Megger acquisition.

Previous wording

Amortization of intangible assets was $20.4 million and $40.7 million for the second quarter and first six months of 2026, respectively, compared to $8.0 million and $16.0 million for the corresponding periods of 2025. Amortization expenses consist of amortization of acquired intangible assets from acquisitions and other identifiable intangible assets (primarily software). The increase in amortization expense in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly due to an increase in amortization of intangible assets related to the Maritime acquisition.

Current wording

Amortization of intangible assets was $20.3 million and $61.1 million for the third quarter and first nine months of 2026, respectively, compared to $16.8 million and $32.7 million for the corresponding periods of 2025. Amortization expenses consist of amortization of acquired intangible assets from acquisitions and other identifiable intangible assets (primarily software). The increase in amortization expense in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly due to an increase in amortization of intangible assets related to the Maritime acquisition.

Previous wording

Other expenses, net, was $1.8 million in the second quarter of 2026 compared with $0.4 million in the second quarter of 2025. Other expenses, net, was $1.8 million in the first six months of 2026 compared to other (income) of ($0.3) million in the first six months of 2025. The principal components of other expenses, net, in the second quarter and first six months of 2026 included $1.3 million of restructuring charges within the Test segment due to the exit of the acoustics product line (primarily asset write-offs, contract termination charges and severance), and $0.6 million of restructuring charges (primarily severance) within the USG segment. There were no individually significant items in other expenses (income), net, in the second quarter of 2025. The principal component of other expenses, net, in the first six months of 2025 was approximately $0.5 million of restructuring charges (primarily severance) within the Test and USG segments.

Current wording

Other expenses, net, was $0.5 million in the third quarter of 2026 compared with $2.2 million in the third quarter of 2025. Other expenses, net, was $2.3 million in the first nine months of 2026 compared with $1.9 million in the first nine months of 2025. The principal components of other expenses, net, in the third quarter of 2026 included $0.7 million of restructuring charges within the Test segment due to the exit of the acoustics product line (primarily asset write-offs), and $0.3 million of restructuring charges (primarily severance) within the USG segment. The principal components of other expenses, net, in the first nine months of 2026 included $2.0 million of restructuring charges within the Test segment due to the exit of the acoustics product line and $0.9 million of restructuring charges (primarily severance) within the USG segment. The principal component of other expenses, net, in the third quarter and first nine months of 2025 was $1.3 million of UK stamp duties on the Maritime acquisition.

Previous wording

The Company evaluates the performance of its operating segments based on EBIT, and provides EBIT on a consolidated basis. EBIT is a non-GAAP financial measure. Please refer to the discussion of non-GAAP financial measures in Note 6 to the condensed Consolidated Financial Statements, above. EBIT was $46.3 million (15.0% of net sales) for the second quarter of 2026 compared to $36.6 million (15.8% of net sales) for the second quarter of 2025. For the first six months of 2026, EBIT was $84.6 million (14.1% of net sales) compared to $64.7 million (14.5% of net sales) for the first six months of 2025.

Current wording

The Company evaluates the performance of its operating segments based on EBIT, and provides EBIT on a consolidated basis. EBIT is a non-GAAP financial measure. Please refer to the discussion of non-GAAP financial measures in Note 6 to the condensed Consolidated Financial Statements, above. EBIT was $49.7 million (14.6% of net sales) for the third quarter of 2026 compared to $41.0 million (13.8% of net sales) for the third quarter of 2025. For the first nine months of 2026, EBIT was $134.3 million (14.3% of net sales) compared to $105.7 million (14.2% of net sales) for the first nine months of 2025.

Previous wording

The following table presents a reconciliation of EBIT from continuing operations to net earnings.

Current wording

The following table presents a reconciliation of EBIT from continuing operations to net earnings from continuing operations.

Previous wording

EBIT in the second quarter of 2026 was $43.0 million (28.6% of net sales) compared to $24.2 million (27.0% of net sales) in the second quarter of 2025. EBIT in the first six months of 2026 was $81.0 million (27.5% of net sales) compared to $41.7 million (24.3% of net sales) in the first six months of 2025. The increase in EBIT in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly driven by leverage on higher sales volumes as mentioned above, and price increases, partially offset by inflationary pressures and unfavorable mix.

Current wording

EBIT in the third quarter of 2026 was $50.4 million (30.0% of net sales) compared to $36.6 million (26.8% of net sales) in the third quarter of 2025. EBIT in the first nine months of 2026 was $131.4 million (28.4% of net sales) compared to $78.2 million (25.4% of net sales) in the first nine months of 2025. The increase in EBIT in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly driven by leverage on higher sales volumes as mentioned above, and price increases, partially offset by inflationary pressures and unfavorable mix. EBIT in the third quarter and first nine months of 2025 was negatively impacted by $2.7 million of inventory step-up charges and stamp duty charges related to the Maritime acquisition.

Previous wording

EBIT in the second quarter of 2026 was $22.5 million (24.0% of net sales) compared to $20.8 million (22.9% of net sales) in the second quarter of 2025. EBIT in the first six months of 2026 was $42.0 million (23.2% of net sales) compared to $41.3 million (23.3% of net sales) in the first six months of 2025. The increase in EBIT in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly driven by leverage on higher sales volumes at Doble and price increases and mix, partially offset by lower sales volumes at NRG, and inflationary pressures. EBIT was negatively impacted by $0.6 million of restructuring charges (primarily severance) in the first six months of 2026.

Current wording

EBIT in the third quarter of 2026 was $22.0 million (22.0% of net sales) compared to $21.5 million (23.3% of net sales) in the third quarter of 2025. EBIT in the first nine months of 2026 was $64.0 million (22.8% of net sales) compared to $62.8 million (23.2% of net sales) in the first nine months of 2025. The increase in EBIT in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly driven by leverage on higher sales volumes at Doble and price increases and mix, partially offset by lower sales volumes at NRG, and inflationary pressures. EBIT was negatively impacted by $0.9 million and $0.3 million in the first nine months of 2026 and 2025, respectively, by restructuring charges (primarily severance) and acquisition costs.

Previous wording

EBIT in the second quarter of 2026 was $8.8 million (13.4% of net sales) compared to $6.4 million (12.4% of net sales) in the second quarter of 2025. EBIT in the first six months of 2026 was $16.8 million (13.6% of net sales) compared to $10.8 million (11.1% of net sales) in the first six months of 2025. The increase in EBIT in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly due to higher sales volumes and price increases partially offset by inflationary pressures. EBIT was negatively impacted by $1.3 million and $0.4 million in the first six months of 2026 and 2025, respectively, by restructuring charges (primarily asset write-offs, contract termination charges and severance).

Current wording

EBIT in the third quarter of 2026 was $10.9 million (15.4% of net sales) compared to $10.7 million (15.9% of net sales) in the third quarter of 2025. EBIT in the first nine months of 2026 was $27.7 million (14.2% of net sales) compared to $21.5 million (13.0% of net sales) in the first nine months of 2025. The increase in EBIT in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly due to higher sales volumes and price increases partially offset by inflationary pressures. EBIT was negatively impacted by $2.1 million and $0.4 million in the first nine months of 2026 and 2025, respectively, by restructuring charges (primarily asset write-offs, contract termination charges and severance).

Previous wording

Corporate costs included in EBIT were $28.0 million and $55.2 million in the second quarter and first six months of 2026, respectively, compared to $14.8 million and $29.1 million in the corresponding periods of 2025. The increase in Corporate costs in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly due to an increase in acquisition related amortization due to the Maritime acquisition, and an increase in share-based compensation costs and acquisition related costs.

Current wording

Corporate costs included in EBIT were $33.6 million and $88.8 million in the third quarter and first nine months of 2026, respectively, compared to $27.9 million and $56.9 million in the corresponding periods of 2025. The increase in Corporate costs in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly due to an increase in acquisition related amortization due to the Maritime acquisition, and an increase in share-based compensation costs and acquisition related costs related to the pending Megger acquisition.

Previous wording

Interest expense was $2.4 million and $5.3 million in the second quarter and first six months of 2026, respectively, and $2.2 million and $4.5 million in the corresponding periods of 2025. The increase in interest expense in the second quarter and first six months of 2026 compared to the corresponding periods of 2025 was mainly due to higher average outstanding borrowings due to the Maritime acquisition in April 2025. The weighted average outstanding borrowings were $168 million and $170 million for the three and six-month periods ending March 31, 2026 and $100 million and $111 million for the three and six-month periods ending March 31, 2025.

Current wording

Interest expense was $8.7 million and $14.0 million in the third quarter and first nine months of 2026, respectively, and $7.9 million and $12.4 million in the corresponding periods of 2025. The increase in interest expense in the third quarter and first nine months of 2026 compared to the corresponding periods of 2025 was mainly due to approximately $7 million of debt financing costs incurred in the third quarter of 2026 related to the pending Megger acquisition, partially offset by lower average outstanding borrowings due to the prior year Maritime acquisition and lower average interest rates.

Previous wording

The second quarter 2026 effective income tax rate was 23.5% compared to 23.3% in the second quarter of 2025. The effective income tax rate in the first six months of 2026 was 21.5% compared to 22.5% for the first six months of 2025. Income tax expense in the first six months of 2026 was favorably impacted by additional tax benefits related to the vesting of share-based compensation awards.

Current wording

The third quarter 2026 effective income tax rate from continuing operations was 20.1% compared to 25.1% in the third quarter of 2025. The effective income tax rate from continuing operations in the first nine months of 2026 was 21.0% compared to 23.4% for the first nine months of 2025. Income tax expense in the third quarter and first nine months of 2026 was favorably impacted by return-to-provision adjustments recognized upon finalization of the 2025 federal income tax return, including an increase to the federal research

Previous wording

The Company’s overall financial position and liquidity remain strong. Working capital (current assets less current liabilities) increased to $226.4 million at March 31, 2026 from $180.4 million at September 30, 2025. Inventories increased $19.3 million during this period due to a $7.7 million increase within the A&D segment, a $9.1 million increase within the USG segment and a $2.5 million increase within the Test segment primarily from an increase in work-in-process and raw materials inventories due to timing of manufacturing existing orders. Contract assets increased $12.8 million primarily within the A&D segment (Maritime) due to timing. Contract liabilities increased $52.8 million primarily within the A&D segment (Globe and Maritime) due to timing of payments received from customers.

Current wording

The Company’s overall financial position and liquidity remain strong. Working capital (current assets less current liabilities) increased to $208.8 million at June 30, 2026 from $180.4 million at September 30, 2025. Inventories increased $22.7 million during this period due to a $14.9 million increase within the A&D segment, and a $9.2 million increase within the USG segment; both increases due to higher work-in-process and raw materials inventories due to timing of manufacturing existing orders, partially offset by a $1.4 million decrease within the Test segment. Contract assets increased $36.9 million primarily within the A&D segment (Maritime) due to timing. Contract liabilities increased $71.5 million primarily within the A&D segment (Globe and Maritime) due to timing of payments received from customers.

Previous wording

Net cash provided by operating activities from continuing operations was $134.6 million and $46.3 million in the first six months of 2026 and 2025, respectively. The increase in net cash provided by operating activities in the first six months of 2026 as compared to the first six months of 2025 was mainly driven by lower working capital requirements and higher earnings.

Current wording

Net cash provided by operating activities from continuing operations was $193.4 million and $88.3 million in the first nine months of 2026 and 2025, respectively. The increase in net cash provided by operating activities in the first nine months of 2026 as compared to the first nine months of 2025 was mainly driven by lower working capital requirements and higher earnings.

Previous wording

Capital expenditures for continuing operations were $13.1 million and $14.9 million in the first six months of 2026 and 2025, respectively. In addition, the Company incurred expenditures for capitalized software and other intangible assets from continuing operations of $4.8 million and $5.5 million in the first six months of 2026 and 2025, respectively.

Current wording

Capital expenditures for continuing operations were $24.6 million and $24.2 million in the first nine months of 2026 and 2025, respectively. In addition, the Company incurred expenditures for capitalized software and other intangible assets from continuing operations of $7.9 million and $13.0 million in the first nine months of 2026 and 2025, respectively.

Previous wording

At March 31, 2026, the Company had approximately $440 million available to borrow under its bank credit facility, a $250 million increase option, and $92.3 million cash on hand. At March 31, 2026, the Company had $145 million of outstanding borrowings under the Credit Facility and Incremental Facility in addition to outstanding letters of credit of $14.5 million. Cash flow from operations and borrowings under the Company’s credit facility are expected to meet the Company’s capital requirements and operational needs for the foreseeable future. The Company’s ability to access the additional $250 million increase option of the credit facility is subject to acceptance by participating or other outside banks.

Current wording

At June 30, 2026, the Company had approximately $442 million available to borrow under its bank credit facility, a $250 million increase option, and $73.2 million cash on hand. At June 30, 2026, the Company had $85 million of outstanding borrowings under the Credit Facility and Incremental Facility in addition to outstanding letters of credit of $12.7 million. Cash flow from operations and borrowings under the Company’s credit facility are expected to meet the Company’s capital requirements and operational needs for the foreseeable future. The Company’s ability to access the additional $250 million increase option of the credit facility is subject to acceptance by participating or other outside banks.

Previous wording

During the first six months of fiscal 2026, the Company paid $10.2 million consisting of a $5.1 million working capital settlement and a $5.1 million group tax relief payment, both related to the Maritime acquisition.

Current wording

During the first nine months of fiscal 2026, the Company paid $10.2 million consisting of a $5.1 million working capital settlement and a $5.1 million group tax relief payment, both related to the Maritime acquisition.

Previous wording

On April 15, 2026, the Company signed a definitive agreement to acquire the Megger Group Limited (Megger) business of TBG AG. Megger is a global provider of testing, monitoring, and data-driven solutions for utilities and critical electric infrastructure, including industrial, transportation, data center and renewable end markets. Under the terms of the agreement, ESCO will acquire Megger for total consideration of approximately $2.35 billion, consisting of $0.9 billion in cash and ESCO equity valued at approximately $1.4 billion. The cash portion will be funded through existing cash on hand and incremental debt, with committed financing in place. The Company expects to complete the acquisition in the first quarter of fiscal 2027. Megger will become part of the Company’s Utility Solution Group (USG) segment. See further discussion of the transaction and financing arrangements in the Company’s Form 8-K’s filed April 15, 2026 and April 16, 2026.

Current wording

On April 15, 2026, the Company signed a definitive agreement to acquire the Megger business of TBG AG. Megger is a global provider of testing, monitoring, and data-driven solutions for utilities and critical electric infrastructure, including industrial, transportation, data center and renewable end markets. Under the terms of the agreement, ESCO will acquire Megger for total consideration of approximately $2.35 billion, consisting of $0.9 billion in cash and ESCO equity valued at approximately $1.4 billion. The cash portion will be funded through existing cash on hand and incremental debt, with committed financing in place. The Company expects to complete the acquisition in the first quarter of fiscal 2027. Megger will become part of the Company’s USG segment. See further discussion of the transaction and financing arrangements in the Company’s Form 8-K’s filed April 15, 2026 and April 16, 2026.

Previous wording

A dividend of $0.08 per share, totaling $2.1 million, was paid on October 16, 2025 to stockholders of record as of October 2, 2025. A dividend of $0.08 per share, totaling $2.1 million, was paid on January 16, 2026 to stockholders of record as of January 2, 2026. Subsequent to March 31, 2026, a quarterly dividend of $0.08 per share, totaling $2.1 million, was paid on April 17, 2026 to stockholders of record as of April 2, 2026.

Current wording

A dividend of $0.08 per share, totaling $2.1 million, was paid on October 16, 2025 to stockholders of record as of October 2, 2025. A dividend of $0.08 per share, totaling $2.1 million, was paid on January 16, 2026 to stockholders of record as of January 2, 2026. A dividend of $0.08 per share, totaling $2.1 million, was paid on April 17, 2026 to stockholders of record as of April 2, 2026. Subsequent to June 30, 2026, a quarterly dividend of $0.08 per share, totaling $2.1 million, was paid on July 17, 2026 to stockholders of record as of July 2, 2026.