Cooper-Standard Holdings Inc.

Previous wording

The global automotive industry is susceptible to unpredictable economic conditions that can adversely impact new vehicle demand and production levels. These challenges may be compounded by disruptions in supply chains for certain critical materials and components, and business conditions can vary materially by region and over time. In 2025, global light vehicle production increased modestly despite persistent economic risks and uncertainties. The industry outlook for the remainder of 2026 continues to be uncertain due to geopolitical risks, including military actions in the Middle East, rising oil prices, constraints on global trade and transportation through the Strait of Hormuz, and increased inflationary pressures.

Current wording

The global automotive industry is susceptible to unpredictable economic conditions that can adversely impact new vehicle demand and production levels. These conditions may be compounded by disruptions in supply chains for certain critical materials and components, and business conditions can vary materially by region and over time. In 2025, global light vehicle production increased modestly despite persistent economic risks and uncertainties. During the first nine months of 2026, however, global light vehicle production declined by 0.7 percent, with the most significant declines occurring in China and North America. The industry outlook for the remainder of 2026 continues to be uncertain due to ongoing geopolitical and macroeconomic risks, including military actions in the Middle East, rising oil prices, constraints on global trade and transportation through the Strait of Hormuz, and continued broad-based inflationary pressures.

Previous wording

In North America, consumer confidence in the United States remains subdued, with certain surveys and economic indices remaining near their lowest levels in over a decade. Ongoing concerns regarding U.S. military actions in the Middle East and continued uncertainty surrounding U.S. trade policy have contributed to heightened volatility across capital and consumer markets. Persistently high interest rates, elevated prices for energy and consumer goods, and rising levels of consumer debt are further weighing on overall economic activity. Conversely, lower tax rates, reduced regulation, and other incentives included in recently enacted legislation are expected to support commercial investment and consumer demand once geopolitical conditions stabilize. Economists at the International Monetary Fund (“IMF”) project that the economies of the United States, Canada and Mexico will grow by 2.3 percent, 1.1 percent and 1.2 percent, respectively, in 2026.

Current wording

In North America, consumer confidence in the United States remains subdued, with certain surveys and economic indices remaining near their lowest levels in more than a decade. Ongoing concerns regarding U.S. military actions in the Middle East and continued uncertainty surrounding U.S. trade policy have contributed to heightened volatility across capital and consumer markets. Persistently high interest rates, elevated prices for energy and other commodities, broad-based inflationary pressures, and increasing levels of consumer debt are further weighing on overall economic activity. Conversely, lower tax rates, reduced regulation, and other incentives included in recently enacted legislation are expected to support commercial investment and consumer demand once geopolitical conditions stabilize. In addition, the outcome of the recent mid-term elections in the United States could contribute to further economic and policy uncertainty. Economists at the International Monetary Fund (“IMF”) project that the economies of the United States, Canada and Mexico will grow by 2.3 percent, 1.1 percent and 1.5 percent, respectively, in 2026.

Previous wording

In Europe, trends toward economic stabilization and expansion evident earlier in the year have been disrupted by the military actions in the Middle East. Rising oil and natural gas prices are contributing to higher inflation and lower consumer spending. Fiscal stimulus, particularly in Germany, increased defense-related spending, and continuing solid business investment are expected to provide some support to regional economic activity, partially offsetting lower consumer spending. In addition, unemployment in the region appears to be stabilizing at approximately 6.0% which is the lowest level in a decade. Amid this uncertain environment, economists at the IMF project that the Eurozone economy will grow by 0.9 percent in 2026.

Current wording

In Europe, trends toward economic stabilization and growth observed earlier in the year have been disrupted by military actions in the Middle East. Rising oil and natural gas prices have contributed to increased inflationary pressures and lower consumer spending. Fiscal stimulus measures, particularly in Germany, increased defense-related spending and continued business investment are expected to provide some support to regional economic activity, partially offsetting the impact of weaker consumer spending. In addition, regional unemployment has remained relatively stable at approximately 6.0%, its lowest level in a decade. Against this uncertain economic environment, economists at the IMF project that the Eurozone economy will grow by 1.1 percent in 2026.

Previous wording

In the Asia Pacific region, China’s economy has continued to grow steadily, supported by domestic stimulus measures and increased export activity. Lower effective U.S. tariffs and domestic stimulus have helped offset certain impacts of the military actions in the Middle East. However, weak consumer demand, persistent declines in property values and rising public debt continue to cloud the outlook for future growth, with consumer confidence remaining near its lowest level in a decade. Despite these challenges, economists at the IMF project that China’s economy will grow by 4.6 percent in 2026.

Current wording

In the Asia Pacific region, China’s economy has continued to grow steadily, supported by domestic stimulus measures and increased export activity. Lower effective U.S. tariffs and domestic stimulus measures have helped mitigate certain economic impacts associated with military actions in the Middle East. However, weak consumer demand, persistent declines in property values and rising public debt remain risks to the economic outlook, with consumer confidence remaining near its lowest level in a decade. Despite these challenges, economists at the IMF project that China’s economy will grow by 4.5 percent in 2026.

Previous wording

In South America, the Brazilian central bank initiated a policy to lower interest rates during the first quarter of 2026 in an effort to stimulate economic growth. However, inflationary pressures have re-emerged as military actions in the Middle East have led to higher energy prices and increased costs for imported fertilizers critical to Brazil’s agriculture sector. With inflation concerns rising, the central bank may moderate its pace of rate reductions in the near term. Despite these concerns and ongoing global market uncertainty, consumer confidence in Brazil remains well above the averages observed over the past decade. As a result, economists at the IMF project that Brazil's economy will grow by 2.4 percent in 2026.

Current wording

In South America, the Brazilian central bank initiated a policy of lowering interest rates during the first quarter of 2026 in an effort to stimulate economic growth. However, inflationary pressures have re-emerged, driven in part by higher energy prices and increased costs for imported fertilizers critical to Brazil’s agriculture sector resulting from military actions in the Middle East. In addition, Brazilian financial markets initially reacted negatively to the results of the recent presidential election, and the relative value of the Brazilian Real may remain under pressure. In response to renewed inflationary concerns, the central bank may moderate the pace of further interest rate reductions in the near term. The outlook for the Brazilian economy remains uncertain, reflecting potential economic and policy implications of the election results as well as continued geopolitical and global market uncertainty. Economists at the IMF most recently projected that Brazil's economy will grow by 2.2 percent in 2026.

Previous wording

Light vehicle production in certain regions for the three and six months ended June 30, 2026 and 2025 was as follows:

Current wording

Light vehicle production in certain regions for the three and nine months ended September 30, 2026 and 2025 was as follows:

Previous wording

Current industry forecasts project that global light vehicle production will decline by approximately 2% in 2026 compared with 2025, followed by modest growth in 2027. Actual production volumes, however, have varied historically and may fluctuate from forecasted levels due to geopolitical actions, catastrophic events affecting the supply of aluminum and other critical materials and components, broader supply chain disruptions, labor-related disruptions in certain regions or locations, cyberattacks or natural disasters impacting customer operations, changes in consumer demand, the regulatory environment, availability of incentives and overall industry competitiveness, among other factors. In addition, the electric vehicle segment continues to face significant challenges in achieving previously forecasted production volumes, particularly in North America.

Current wording

Current industry forecasts project that global light vehicle production will decline by approximately 2% in 2026 compared with 2025, followed by flat to modest growth in 2027. Actual production volumes, however, have varied historically and may fluctuate from forecasted levels due to geopolitical actions, catastrophic events affecting the supply of aluminum and other critical materials and components, broader supply chain disruptions, labor-related disruptions in certain regions or locations, cyberattacks or natural disasters impacting customer operations, changes in consumer demand, the regulatory environment, availability of incentives and overall industry competitiveness, among other factors. In addition, the electric vehicle segment continues to face significant challenges in achieving previously forecasted production volumes, particularly in North America.

Previous wording

Our business is susceptible to inflationary pressures related to raw materials. Abrupt changes in the market prices or availability of certain key raw materials may result in operational and profitability challenges for the Company and the industry as a whole. Although global commodity markets and pricing remained relatively stable in 2025, geopolitical instability in the Middle East during the first six months of 2026 has contributed to higher oil prices and disruptions along major global shipping routes. These conditions may result in shipment delays, extended transit times, increased fuel, freight and insurance costs, reduced carrier availability, or the need to reroute cargo, any of which could adversely affect our supply chain, production schedules, operating costs, and ability to meet customer delivery commitments. During the second quarter of 2026, we experienced a significant spike in raw material costs, primarily but not exclusively related to petroleum-derived products. We continue to work closely with our customers and suppliers to mitigate ongoing inflationary pressures and material-related cost exposures through a combination of index-based pricing agreements and other commercial enhancements.

Current wording

Our business is susceptible to inflationary pressures related to raw materials. Volatility in the market prices and availability of certain key raw materials, together with evolving trade policies and geopolitical disruptions, may create operational and profitability challenges for the Company and the industry as a whole. These conditions may result in higher base material prices, shipment delays, extended transit times, increased fuel, freight and insurance costs, reduced carrier availability, and the need to reroute cargo. Such impacts could adversely affect our supply chain, production schedules, operating costs and ability to meet customer delivery commitments. Beginning in the second quarter of 2026 and continuing through the third quarter of 2026, we experienced significantly higher raw material costs, primarily but not exclusively related to petroleum-derived products. We continue to work closely with our customers and suppliers to mitigate inflationary pressures and material-related cost exposures through a combination of index-based pricing agreements and other commercial enhancements.

Previous wording

In March 2026, the U.S. Court of International Trade ("CIT") issued an order directing U.S. Customs and Border Protection ("CBP") to process refunds of certain IEEPA tariffs. In April 2026, the CBP released a new system to process IEEPA tariff refunds, allowing importers to submit refund claims. The Company has elected to apply the loss recovery guidance in accordance with ASC 450, Contingencies, to account for the recognition of these refund claims. Any future recovery of tariff refund claims will be recognized as a receivable when the claim becomes probable and will be reflected as a reduction of cost of products sold for inventory previously sold, or as a reduction of inventory for goods that remain unsold. For the three and six months ended June 30, 2026, the IEEPA tariff refunds did not have a material impact on our condensed consolidated financial statements.

Current wording

In March 2026, the U.S. Court of International Trade ("CIT") issued an order directing U.S. Customs and Border Protection ("CBP") to process refunds of certain IEEPA tariffs. In April 2026, CBP implemented a new system through which importers may submit claims for refunds of such tariffs. Accordingly, we submitted claims for refunds of certain IEEPA tariffs previously paid on imports. We account for these refund claims as loss recoveries in accordance with ASC 450, Contingencies. Any recovery will be recognized as a receivable when realization is probable. Amounts recognized will be reflected as a reduction of cost of products sold to the extent related to inventory previously sold and as a reduction of inventory to the extent related to goods that remain unsold. For the three and nine months ended September 30, 2026, the recognition of IEEPA tariff refunds did not have a material impact on our condensed consolidated financial statements.

Previous wording

Sales for the three months ended June 30, 2026 increased 2.2% compared to the three months ended June 30, 2025. The increase in sales was driven by favorable foreign exchange and the favorable impact of volume and mix, net of customer price adjustments, including recoveries.

Current wording

Sales for the three months ended September 30, 2026 increased 1.9% compared to the three months ended September 30, 2025. The increase in sales was driven by the favorable impact of volume and mix, net of customer price adjustments, including recoveries, and favorable foreign exchange.

Previous wording

Cost of products sold is primarily comprised of direct materials, labor, manufacturing overhead, freight, depreciation and other direct operating expenses. Among these, direct materials represent the largest component, accounting for approximately 53% of total cost of products sold for each of the three months ended June 30, 2026 and June 30, 2025. The change in cost of products sold was impacted by unfavorable foreign exchange, increased costs from volume and mix, net of recoveries, and increased costs from higher inflation of labor and overhead, increased tariff expense, and unfavorable material economics, partially offset by manufacturing and purchasing savings through lean initiatives and savings from prior year restructuring initiatives.

Current wording

Cost of products sold is primarily comprised of direct materials, labor, manufacturing overhead, freight, depreciation and other direct operating expenses. Among these, direct materials represent the largest component, accounting for approximately 52% of total cost of products sold for each of the three months ended September 30, 2026 and September 30, 2025. The change in cost of products sold was impacted by increased costs from volume and mix, net of recoveries, unfavorable foreign exchange, unfavorable material economics, and higher inflation of labor and overhead, partially offset by cost decreases driven bypurchasing savings through lean initiatives, decreased tariff expense, and savings from prior year restructuring initiatives.

Previous wording

Gross profit for the three months ended June 30, 2026 decreased $9.3 million compared to the three months ended June 30, 2025. The change in gross profit was driven by increased costs due to higher inflation of labor and overhead, increased tariff expense, unfavorable material economics, and unfavorable foreign exchange, partially offset by manufacturing and purchasing savings through lean initiatives and savings from prior year restructuring initiatives.

Current wording

Gross profit for the three months ended September 30, 2026 decreased $9.4 million compared to the three months ended September 30, 2025. The change in gross profit was driven by unfavorable volume and mix, net of recoveries, unfavorable foreign exchange, unfavorable material economics, and higher inflation of labor and overhead, partially offset by cost decreases driven bypurchasing savings through lean initiatives, decreased tariff expense, and savings from prior year restructuring initiatives.

Previous wording

Selling, Administration and Engineering Expenses. Selling, administration and engineering expenses include administrative expenses as well as product engineering and design and development costs. Selling, administration and engineering expenses for the three months ended June 30, 2026 were $52.6 million, or 7.3% of sales, compared to $51.2 million, or 7.3% of sales, for the three months ended June 30, 2025. The increase in dollar terms was primarily due to foreign exchange.

Current wording

Selling, Administration and Engineering Expenses. Selling, administration and engineering expenses include administrative expenses as well as product engineering and design and development costs. Selling, administration and engineering expenses for the three months ended September 30, 2026 were $47.0 million, or 6.6% of sales, compared to $55.4 million, or 8.0% of sales, for the three months ended September 30, 2025. The decrease, in both dollar terms and as a percentage of sales, was primarily due to lower employee incentive compensation expense.

Previous wording

Restructuring Charges. Restructuring charges for the six months ended June 30, 2026 increased $16.7 million compared to the six months ended June 30, 2025. The increase was primarily driven by higher restructuring costs related to employee severance and other related exit costs associated with the closure and downsizing of certain plants in Europe and North America.

Current wording

Restructuring Charges. Restructuring charges for the three months ended September 30, 2026 increased $15.7 million compared to the three months ended September 30, 2025. The increase was primarily driven by higher restructuring costs related to employee severance and other related exit costs associated with the closure and downsizing of certain plants in Europe and North America.

Previous wording

Other Expense, Net. Other expense, net, for the three months ended June 30, 2026 decreased $2.7 million compared to the three months ended June 30, 2025. The change was primarily driven by $0.5 million of foreign currency gains recognized in the three months ended June 30, 2026 compared to $2.4 million of foreign currency losses recognized in the three months ended June 30, 2025.

Current wording

Other Expense, Net. Other expense, net, for the three months ended September 30, 2026 decreased $1.0 million compared to the three months ended September 30, 2025. The decrease was primarily driven by lower foreign currency losses.

Previous wording

Income Tax Expense. Income tax expense for the three months ended June 30, 2026 was $5.4 million on losses before income taxes of $13.5 million compared to an income tax expense of $8.1 million on earnings before income taxes of $6.6 million for the three months ended June 30, 2025. The effective tax rate for the three months ended June 30, 2026 differed from the effective tax rate for the three months ended June 30, 2025 primarily due to the geographic mix of pre-tax losses, the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to valuation allowances and other permanent items.

Current wording

Income Tax Expense. Income tax expense for the three months ended September 30, 2026 was $3.2 million on losses before income taxes of $17.7 million compared to an income tax expense of $3.9 million on losses before income taxes of $3.8 million for the three months ended September 30, 2025. The effective tax rate for the three months ended September 30, 2026 differed from the effective tax rate for the three months ended September 30, 2025 primarily due to the geographic mix of pre-tax losses, the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to valuation allowances and other permanent items.

Previous wording

Sales for the six months ended June 30, 2026 increased 2.5%, compared to the six months ended June 30, 2025. The increase in sales was driven primarily by favorable foreign exchange.

Current wording

Sales for the nine months ended September 30, 2026 increased 2.3% compared to the nine months ended September 30, 2025. The increase in sales was driven primarily by favorable foreign exchange and the favorable impact of volume and mix, net of customer price adjustments, including recoveries.

Previous wording

Direct materials accounted for approximately 52% and 53% of total costs of products sold for the six months ended June 30, 2026 and June 30, 2025, respectively. The change in cost of products sold was impacted by unfavorable foreign exchange, increased costs from volume and mix, net of recoveries, unfavorable material economics, and higher inflation of labor and overhead, partially offset by cost decreases driven by manufacturing and purchasing savings through lean initiatives and savings from prior year restructuring initiatives.

Current wording

Direct materials accounted for approximately 52% and 53% of total costs of products sold for the nine months ended September 30, 2026 and September 30, 2025, respectively. The change in cost of products sold was impacted by unfavorable foreign exchange, increased costs from volume and mix, net of recoveries, unfavorable material economics, and higher inflation of labor and overhead, partially offset by manufacturing and purchasing savings through lean initiatives, decreased tariff expense, and savings from prior year restructuring initiatives.

Previous wording

Gross profit for the six months ended June 30, 2026 decreased $4.1 million compared to the six months ended June 30, 2025. The change in gross profit was driven by unfavorable volume and mix, net of recoveries, unfavorable foreign exchange, unfavorable material economics, and higher inflation of labor and overhead, partially offset by cost decreases driven by manufacturing and purchasing savings through lean initiatives and savings from prior year restructuring initiatives.

Current wording

Gross profit for the nine months ended September 30, 2026 decreased $13.4 million compared to the nine months ended September 30, 2025. The change in gross profit was driven by unfavorable volume and mix, net of recoveries, unfavorable foreign exchange, unfavorable material economics, and higher inflation of labor and overhead, partially offset by cost decreases driven by manufacturing and purchasing savings through lean initiatives, decreased tariff expense, and savings from prior year restructuring initiatives.

Previous wording

Selling, Administration and Engineering Expenses. Selling, administration and engineering expenses for the six months ended June 30, 2026 were $105.1 million, or 7.5% of sales, compared to $102.4 million, or 7.5% of sales for the six months ended June 30, 2025. The increase in dollar terms was primarily due to foreign exchange.

Current wording

Selling, Administration and Engineering Expenses. Selling, administration and engineering expenses for the nine months ended September 30, 2026 were $152.1 million, or 7.2% of sales, compared to $157.8 million, or 7.6% of sales for the nine months ended September 30, 2025. The decrease, in both dollar terms and as a percentage of sales, was primarily due to lower employee incentive compensation expense, partially offset by unfavorable foreign exchange.

Previous wording

Restructuring Charges. Restructuring charges for thethree months ended June 30, 2026 increased $14.2 million compared to thethree months ended June 30, 2025. The increase was primarily driven by higher restructuring costs related to employee severance and other related exit costs associated with the closure and downsizing of certain plants in Europe and North America.

Current wording

Restructuring Charges. Restructuring charges for the nine months ended September 30, 2026 increased $32.4 million compared to the nine months ended September 30, 2025. The increase was primarily driven by higher restructuring costs related to employee severance and other related exit costs associated with the closure and downsizing of certain plants in Europe and North America.

Previous wording

Loss on Refinancing and Extinguishment of Debt. Loss on refinancing and extinguishment of debt for thesix months ended June 30, 2026 was $24.2 million, which resulted from redemption premiums associated with the prepayment of our First Lien Notes and Third Lien Notes and the write off of unamortized debt issuance costs and unamortized original issue discount on our First Lien Notes and Third Lien Notes related to the Refinancing Transactions described in Liquidity and Capital Resources.

Current wording

Loss on Refinancing and Extinguishment of Debt. Loss on refinancing and extinguishment of debt for thenine months ended September 30, 2026 was $24.2 million, which resulted from redemption premiums associated with the prepayment of our First Lien Notes and Third Lien Notes and the write off of unamortized debt issuance costs and unamortized original issue discount on our First Lien Notes and Third Lien Notes related to the Refinancing Transactions described in Liquidity and Capital Resources.

Previous wording

Other (Expense) Income, Net. Other expense, net for the six months ended June 30, 2026 was $3.1 million compared to other income, net of $5.2 million for the six months ended June 30, 2025. The change was primarily driven by $10.3 million ofincome recognized in connection with certain royalty settlements in the prior year period.

Current wording

Other (Expense) Income, Net. Other expense, net for the nine months ended September 30, 2026 was $4.9 million compared to other income, net of $2.4 million for the nine months ended September 30, 2025. The change was primarily driven by $10.3 million ofincome recognized in connection with certain royalty settlements in the prior year period.

Previous wording

Income Tax Expense. Income tax expense for the six months ended June 30, 2026 was $9.6 million on losses before income taxes of $42.6 million compared to income tax expense of $10.8 million on earnings before income taxes of $10.9 million for the six months ended June 30, 2025. The effective tax rate for the six months ended June 30, 2026 differed from the effective tax rate for the six months ended June 30, 2025 primarily due to the geographic mix of pre-tax earnings and losses, the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to valuation allowances, and other permanent items.

Current wording

Income Tax Expense. Income tax expense for the nine months ended September 30, 2026 was $12.8 million on losses before income taxes of $60.2 million compared to income tax expense of $14.6 million on earnings before income taxes of $7.2 million for the nine months ended September 30, 2025. The effective tax rate for the nine months ended September 30, 2026 differed from the effective tax rate for the nine months ended September 30, 2025 primarily due to the geographic mix of pre-tax earnings and losses, the inability to record a tax benefit for pre-tax losses in the U.S. and certain foreign jurisdictions due to valuation allowances, and other permanent items.

Previous wording

Fluid Handling Systems. The variance in volume and mix, including customer price adjustments, was driven by favorable volume and mix, improved customer recoveries, and increased tariff recoveries. The foreign currency exchange variance was driven by a $1.4 million favorable impact of the Chinese Renminbi, a $0.9 million favorable impact of the Euro, and a $0.3 million unfavorable impact of all other currencies.

Current wording

Fluid Handling Systems. The variance in volume and mix, including customer price adjustments, was driven by favorable volume and mix and improved customer recoveries, partially offset by decreased tariff recoveries. The foreign currency exchange variance was driven by a $1.4 million favorable impact of the Chinese Renminbi and a $0.4 million unfavorable impact of all other currencies.

Previous wording

Sealing Systems. The variance in volume and mix, including customer price adjustments, was driven by lower customer volumes and unfavorable mix. The foreign currency exchange variance was primarily driven by the strengthening of the Euro relative to the U.S. dollar, which resulted in a $15.9 million favorable impact, as well as a $5.7 million favorable impact of the Chinese Renminbi, a $4.4 million favorable impact of the Brazilian Real, and a $0.7 million favorable impact of all other currencies.

Current wording

Sealing Systems. The variance in volume and mix, including customer price adjustments, was driven by lower customer volumes and unfavorable mix. The foreign currency exchange variance was primarily driven by the strengthening of the Euro relative to the U.S. dollar, which resulted in a $14.0 million favorable impact, as well as a $9.7 million favorable impact of the Chinese Renminbi, a $5.8 million favorable impact of the Brazilian Real, and a $0.3 million favorable impact of all other currencies.

Previous wording

Fluid Handling Systems. The variance in volume and mix, including customer price adjustments, was driven by favorable volume and mix, improved customer recoveries, and increased tariff recoveries. The foreign currency exchange variance was primarily driven by the strengthening of the Euro relative to the U.S. dollar, which resulted in a $4.7 million favorable impact, as well as a $2.4 million favorable impact of the Chinese Renminbi, and a $0.3 million favorable impact of all other currencies.

Current wording

Fluid Handling Systems. The variance in volume and mix, including customer price adjustments, was driven primarily byfavorable volume and mix. The foreign currency exchange variance was primarily driven by the strengthening of the Euro relative to the U.S. dollar, which resulted in a $4.1 million favorable impact, as well as a $3.7 million favorable impact of the Chinese Renminbi, and a $0.6 million favorable impact of all other currencies.

Previous wording

As a result of the Refinancing Transactions, the Company extended the maturities of its indebtedness and reduced the amount of cash interest the Company is required to pay on such indebtedness. The Company recognized a loss on the refinancing and extinguishment of debt of $24.2 million during the six months ended June 30, 2026 related to redemption premiums associated with the prepayment of our First Lien Notes and Third Lien Notes and the write off of unamortized debt issuance costs and unamortized original issue discount on our First Lien Notes and Third Lien Notes. Additionally, the Company incurred total fees and redemption premiums of $35.4 million associated with the Refinancing Transactions, of which $35.0 million were paid during the six months ended June 30, 2026 and $0.4 million are recorded in accounts payable in the condensed consolidated balance sheets as of June 30, 2026 which will be paid in future periods. The fees and redemption premiums paid during the six months ended June 30, 2026 are reflected as a financing outflow in the condensed consolidated statement of cash flows.

Current wording

As a result of the Refinancing Transactions, the Company extended the maturities of its indebtedness and reduced the amount of cash interest the Company is required to pay on such indebtedness. The Company recognized a loss on the refinancing and extinguishment of debt of $24.2 million during the nine months ended September 30, 2026 related to redemption premiums associated with the prepayment of our First Lien Notes and Third Lien Notes and the write off of unamortized debt issuance costs and unamortized original issue discount on our First Lien Notes and Third Lien Notes. Additionally, the Company incurred total fees and redemption premiums of $35.4 million associated with the Refinancing Transactions, all of which were paid during the nine months ended September 30, 2026. The fees and redemption premiums paid during the nine months ended September 30, 2026 are reflected as cash used in financing activities in the condensed consolidated statement of cash flows.

Previous wording

Operating Activities. Net cash used in operations was $39.0 million for the six months ended June 30, 2026, compared to net cash used in operations of $30.4 million for the six months ended June 30, 2025. The net change was primarily due to a decrease in cash interest payments of $30.1 million year-over-year as a result of the Refinancing Transactions described above, partially offset by lower net cash earnings year-over-year driven by $10.3 million ofincome recognized in connection with certain royalty settlements in the prior year and changes in working capital. Working capital was negatively impacted primarily due to an increase in payments related to customer tooling programs during the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Current wording

Operating Activities. Net cash used in operations was $33.8 million for the nine months ended September 30, 2026, compared to net cash provided by operations of $8.2 million for the nine months ended September 30, 2025. The net change was primarily due to lower net cash earnings year-over-year driven by $10.3 million ofincome recognized in connection with certain royalty settlements in the prior year and changes in working capital, partially offset by a decrease in cash interest payments of $29.7 million year-over-year as a result of the Refinancing Transactions described above. Working capital was negatively impacted primarily due to an increase in payments related to customer tooling programs during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025.

Previous wording

Investing Activities. Net cash used in investing activities was $37.9 million for the six months ended June 30, 2026, compared to net cash used in investing activities of $22.8 million for the six months ended June 30, 2025. The net change was primarily due to higher capital expenditures, primarily related to customer program and launch requirements. Capital expenditures were $37.9 million for the six months ended June 30, 2026 compared to $25.3 million for the six months ended June 30, 2025. We expect to maintain disciplined capital spending and anticipate total capital expenditures of approximately $65 million in 2026.

Current wording

Investing Activities. Net cash used in investing activities was $53.8 million for the nine months ended September 30, 2026, compared to net cash used in investing activities of $33.9 million for the nine months ended September 30, 2025. The net change was primarily due to higher capital expenditures, primarily related to customer program and launch requirements. Capital expenditures were $53.8 million for the nine months ended September 30, 2026 compared to $36.5 million for the nine months ended September 30, 2025. We expect to maintain disciplined capital spending and anticipate total capital expenditures of approximately $65 to $70 million in 2026.

Previous wording

Financing Activities. Net cash provided by financing activities totaled $9.7 million for the six months ended June 30, 2026, compared to net cash used in financing activities of $4.4 million for the six months ended June 30, 2025. The net change was primarily due to the net cash impact of the Refinancing Transactions described above. This net change was partially offset by a net increase in tax withholding amounts related to employees’ share-based payment awards by $1.3 million year-over-year.

Current wording

Financing Activities. Net cash provided by financing activities totaled $8.3 million for the nine months ended September 30, 2026, compared to net cash used in financing activities of $3.8 million for the nine months ended September 30, 2025. The net change was primarily due to the net cash impact of the Refinancing Transactions described above. This net change was partially offset by a net increase in tax withholding amounts related to employees’ share-based payment awards by $1.3 million year-over-year.

Previous wording

In June 2018, our Board of Directors approved a common stock repurchase program (the “2018 Program”) authorizing us to repurchase, in the aggregate, up to $150.0 million of our outstanding common stock. Under the 2018 Program, repurchases may be made on the open market, through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by us and in accordance with prevailing market conditions and federal securities laws and regulations. We expect to fund any future repurchases from cash on hand and future cash flows from operations. The specific timing and amount of any future repurchase will vary based on market and business conditions, changes in tax laws and other factors. We are not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at our discretion. The 2018 Program became effective in November 2018. As of June 30, 2026, we had approximately $98.7 million of repurchase authorization remaining under the 2018 Program. We did not make any repurchases under the 2018 Program during the six months ended June 30, 2026 or 2025.

Current wording

In June 2018, our Board of Directors approved a common stock repurchase program (the “2018 Program”) authorizing us to repurchase, in the aggregate, up to $150.0 million of our outstanding common stock. Under the 2018 Program, repurchases may be made on the open market, through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by us and in accordance with prevailing market conditions and federal securities laws and regulations. We expect to fund any future repurchases from cash on hand and future cash flows from operations. The specific timing and amount of any future repurchase will vary based on market and business conditions, changes in tax laws and other factors. We are not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at our discretion. The 2018 Program became effective in November 2018. As of September 30, 2026, we had approximately $98.7 million of repurchase authorization remaining under the 2018 Program. We did not make any repurchases under the 2018 Program during the nine months ended September 30, 2026 or 2025.

Previous wording

We designated Liveline Technologies, Inc. (“Liveline”) as an unrestricted subsidiary under the terms of certain of its debt agreements. Liveline remains a wholly-owned subsidiary of CSA U.S. Liveline incurred a net loss of $0.6 million and $1.1 million during the three and six months ended June 30, 2026, respectively, compared to a net loss of $0.6 million and $1.0 million during the three and six months ended June 30, 2025, respectively. As of June 30, 2026, Liveline had approximately $0.9 million of gross assets. Liveline will look to the Company for necessary funding until it is able to sustain itself through sales of its products and services.

Current wording

We designated Liveline Technologies, Inc. (“Liveline”) as an unrestricted subsidiary under the terms of certain of its debt agreements. Liveline remains a wholly-owned subsidiary of CSA U.S. Liveline incurred a net loss of $0.7 million and $1.8 million during the three and nine months ended September 30, 2026, respectively, compared to a net loss of $0.4 million and $1.4 million during the three and nine months ended September 30, 2025, respectively. As of September 30, 2026, Liveline had approximately $0.8 million of gross assets. Liveline will look to the Company for necessary funding until it is able to sustain itself through sales of its products and services.

Previous wording

The following table provides a reconciliation of EBITDA and Adjusted EBITDA from net (loss) income, which is the most comparable financial measure in accordance with U.S. GAAP:

Current wording

The following table provides a reconciliation of EBITDA and Adjusted EBITDA from net loss, which is the most comparable financial measure in accordance with U.S. GAAP:

Previous wording

There have been no significant changes in our critical accounting estimates during the six months ended June 30, 2026.

Current wording

There have been no significant changes in our critical accounting estimates during the nine months ended September 30, 2026.