NATIONAL PRESTO INDUSTRIES INC

Previous wording

On a consolidated basis, net sales increased by $62,375,000 (39%), gross profit increased by $8,105,000 (28%), selling and general expenses increased by $2,876,000 (19%), impairment of vendor deposit increased $2,701,000, and amortization was consistent. Other income decreased by $2,305,000 (65%), earnings before provision for income taxes increased by $223,000 (1%), and net earnings increased by $117,000 (1%). Details concerning these changes can be found in the comments by segment below.

Current wording

On a consolidated basis, net sales increased by $23,640,000 (26%), gross profit decreased by $1,211,000 (7%), selling and general expenses increased by $1,600,000 (21%), and amortization was consistent. Other income decreased by $702,000 (61%), earnings before provision for income taxes decreased by $3,513,000 (34%), and net earnings decreased by $2,766,000 (34%). Details concerning these changes can be found in the comments by segment below.

Previous wording

Housewares/Small Appliance net sales increased by $1,679,000 from $18,667,000 to $20,346,000, or 9%, 72% of which was attributable to an increase in units shipped, with the balance of the increase related to increases in pricing. Defense net sales increased by $33,687,000 from $66,126,000 to $99,813,000 or 51%, primarily reflecting an increase in shipments from the segment's backlog.

Current wording

Housewares/Small Appliance net sales decreased by $2,274,000 from $24,816,000 to $22,542,000, or 9%, which was attributable to a decrease in units shipped, approximately 53% of which was offset by increases in pricing. Defense net sales increased by $25,794,000 from $66,794,000 to $92,588,000 or 39%, primarily reflecting an increase in shipments from the segment's backlog.

Previous wording

Notwithstanding the increase in sales mentioned above, Housewares/Small Appliance gross profit decreased $2,981,000 from $3,461,000 to $480,000, primarily reflecting the Trump administration's tariffs that went into effect on goods deemed to have been shipped from the Orient after January 31, 2025. Those tariffs are generally treated as period costs and expensed as they are incurred, reflecting the segment’s LIFO inventory cost valuation method. To a lesser degree, increases in the cost of materials had a negative effect on the segment’s gross profit, which were mainly offset by lower repair costs at its main facility. Defense gross profit increased $6,421,000 from $12,779,000 to $19,200,000, primarily reflecting the increase in sales mentioned above. Due to the startup nature of the businesses in the Safety segment and the resulting limited revenues, gross margins were negative in both years.

Current wording

Housewares/Small Appliance gross profit decreased $4,692,000 from $4,997,000 to $305,000, primarily reflecting decrease in sales mentioned above and the impact of the various tariffs imposed under the second Trump term. Those tariffs are generally treated as period costs and expensed as they are incurred, reflecting the segment’s LIFO inventory cost valuation method. Defense gross profit increased $3,414,000 from $13,447,000 to $16,861,000, primarily reflecting the increase in sales mentioned above, partially offset by differences in product mix, efficiencies, and material costs. Due to the startup nature of the businesses in the Safety segment and the resulting limited revenues, gross margins were negative in both years.

Previous wording

Selling and general expenses for the Housewares/Small Appliance segment increased $637,000, primarily due to an increase in self-insurance accruals of $628,000. Selling and general expenses for the Defense segment increased $904,000, primarily attributed to the increases in personnel costs of $722,000, and repairs and maintenance of $91,000. Selling and general expenses for the Safety segment were relatively flat.

Current wording

Selling and general expenses for the Housewares/Small Appliance segment increased $339,000, primarily due to increases in legal and professional cost accruals of $197,000, and compensation related expenses of $197,000, offset by decreases in self-insurance accruals of $81,000. Selling and general expenses for the Defense segment increased $1,701,000, primarily attributed to the increases in personnel costs of $1,434,000, computer and software expense of $89,000, repairs and maintenance of $76,000, and legal and professional costs of $66,000. Selling and general expenses for the Safety segment decreased $440,000, primarily reflecting reduced personnel costs of $91,000, legal and professional costs of $91,000, and the gain recognized on the sale of OneEvent's refrigeration monitoring business that occurred on July 31, 2025 of $253,000.

Previous wording

Earnings before provision for income taxes decreased $1,233,000 from $7,846,000 to $6,613,000. The provision for income taxes decreased from $1,769,000 to $1,461,000, which resulted in an effective income tax rate of 22% and 23% for the quarters ended June 29, 2025 and June 30, 2024, respectively. Net earnings decreased $925,000 from $6,077,000 to $5,152,000, or 15%.

Current wording

Earnings before provision for income taxes decreased $3,513,000 from $10,373,000 to $6,860,000. The provision for income taxes decreased from $2,290,000 to $1,543,000, which resulted in an effective income tax rate of 23% and 22% for the quarters ended September 28, 2025 and September 29, 2024, respectively. Net earnings decreased $2,766,000 from $8,083,000 to $5,317,000, or 34%.

Previous wording

Comparison of First Six Months 2025 and 2024

Current wording

Comparison of First Nine Months 2025 and 2024

Previous wording

Readers are directed to Note D to the Consolidated Financial Statements, “Business Segments,” for data on the financial results of the Company’s three business segments for the first six months ended June 29, 2025 and June 30, 2024.

Current wording

Readers are directed to Note D to the Consolidated Financial Statements, “Business Segments,” for data on the financial results of the Company’s three business segments for the first nine months ended September 28, 2025 and September 29, 2024.

Previous wording

On a consolidated basis, net sales increased by $35,389,000 (42%), gross profit increased by $3,847,000 (26%), selling and general expenses increased by $1,411,000 (18%), impairment of vendor deposit increased $2,701,000, and amortization was consistent. Other income decreased by $968,000 (65%), earnings before provision for income taxes decreased by $1,233,000 (16%), and net earnings decreased by $925,000 (15%). Details concerning these changes can be found in the comments by segment below.

Current wording

On a consolidated basis, net sales increased by $86,015,000 (34%), gross profit increased by $6,894,000 (15%), selling and general expenses increased by $4,476,000 (20%), impairment of vendor deposit increased $2,701,000, and amortization was consistent. Other income decreased by $3,007,000 (64%), earnings before provision for income taxes decreased by $3,290,000 (12%), and net earnings decreased by $2,649,000 (13%). Details concerning these changes can be found in the comments by segment below.

Previous wording

Housewares/Small Appliance net sales increased by $2,338,000 from $39,934,000 to $42,272,000, or 6%, 86% of which was attributable to an increase in units shipped, with the balance of the increase related to increases in pricing. Defense net sales increased by $59,585,000 from $121,166,000 to $180,751,000 or 49%, primarily reflecting an increase in shipments from the segment's backlog.

Current wording

Housewares/Small Appliance net sales were essentially flat. Decreases in units shipped of $2,823,000 were offset by increases in pricing. Defense net sales increased by $85,379,000 from $187,960,000 to $273,339,000 or 45%, primarily reflecting an increase in shipments from the segment's backlog.

Previous wording

Notwithstanding the increase in sales mentioned above, Housewares/Small Appliance gross profit decreased $4,629,000 from $6,569,000 to $1,940,000, primarily reflecting the Trump administration's tariffs that went into effect on goods deemed to have been shipped from the Orient after January 31, 2025. Those tariffs are generally treated as period costs and expensed as they are incurred, reflecting the segment’s LIFO inventory cost valuation method. To a lesser degree, increases in the cost of materials and a less favorable product mix had a negative effect on the segment’s gross profit, which were partially offset by lower repair costs at its main facility. Defense gross profit increased $12,127,000 from $24,703,000 to $36,830,000, primarily reflecting the increase in sales mentioned above. Due to the startup nature of the businesses in the Safety segment and the resulting limited revenues, gross margins were negative in both years.

Current wording

Housewares/Small Appliance gross profit decreased $9,321,000 from $11,566,000 to $2,245,000, primarily reflecting the Trump administration's tariffs that went into effect on goods deemed to have been shipped from the Orient after January 31, 2025. Those tariffs are generally treated as period costs and expensed as they are incurred, reflecting the segment’s LIFO inventory cost valuation method. These were partially offset by lower repair costs at its main facility of approximately $957,000. Defense gross profit increased $15,541,000 from $27,165,000 to $53,691,000, primarily reflecting the increase in sales mentioned above, partially offset by differences in mix, efficiencies, and material costs. Due to the startup nature of the businesses in the Safety segment and the resulting limited revenues, gross margins were negative in both years.

Previous wording

Selling and general expenses for the Housewares/Small Appliance segment increased $1,374,000, primarily due to an increase in self-insurance accruals of $756,000, an increase in legal and professional costs of $253,000, and the absence of the favorable adjustment to the reserve for bad debts of $285,000 that occurred in the prior year. Selling and general expenses for the Defense segment increased $1,664,000, primarily attributed to the increases in personnel costs of $1,334,000, repairs and maintenance of $192,000, and legal and professional costs of $139,000. Selling and general expenses for the Safety segment decreased $162,000, primarily reflecting reduced personnel costs of $126,000 and travel expenses of $112,000.

Current wording

Selling and general expenses for the Housewares/Small Appliance segment increased $1,713,000, primarily due to increases in self-insurance accruals of $675,000, legal and professional cost accruals of $450,000, compensation related expenses of $208,000, and the absence of the favorable adjustment to the reserve for bad debts of $285,000 that occurred in the prior year. Selling and general expenses for the Defense segment increased $3,436,000, primarily attributed to the increases in personnel costs of $2,721,000, computer and software expense of $188,000, repairs and maintenance of $267,000, and legal and professional costs of $205,000. Selling and general expenses for the Safety segment decreased $673,000, primarily reflecting reduced personnel costs of $217,000, legal and professional costs of $63,000, travel expenses of $143,000, and the gain recognized on the sale of OneEvent's refrigeration monitoring business that occurred on July 31, 2025 of $253,000.

Previous wording

The $968,000 decrease in other income was primarily attributable to a decrease in interest income on marketable securities largely stemming from a lower average daily investment as a result of larger investments in inventory required to support augmented Defense segment awards.

Current wording

The $3,007,000 decrease in other income was attributable to a decrease of $2,710,000 in interest income on marketable securities and an increase in interest expense of $297,000 related to the outstanding balance of the Company's revolving line of credit during the first nine months of 2025. Both stem from the increased investments in inventory required to support augmented Defense segment awards.

Previous wording

Earnings before provision for income taxes increased $223,000 from $16,198,000 to $16,421,000. The provision for income taxes increased from $3,553,000 to $3,659,000, which resulted in an effective income tax rate of 22% for both the first six months ended June 29, 2025 and June 30, 2024. Net earnings increased $117,000 from $12,645,000 to $12,762,000, or 1%.

Current wording

Earnings before provision for income taxes decreased $3,290,000 from $26,571,000 to $23,281,000. The provision for income taxes decreased from $5,843,000 to $5,202,000, which resulted in an effective income tax rate of 22% for both the first nine months ended September 28, 2025 and September 29, 2024. Net earnings decreased $2,649,000 from $20,728,000 to $18,079,000, or 13%.

Previous wording

Net cash provided by operating activities was $1,542,000 during the first six months of 2025 as compared to $28,328,000 cash used during the first six months of 2024. The principal factors contributing to the change can be found in the changes in the components of working capital within the Consolidated Statements of Cash Flows. Of particular note during the first six months of 2025 were net earnings of $12,762,000, which included the non-cash impairment of a vendor deposit of $2,701,000 and depreciation and amortization expenses of $2,460,000. Contributing to the cash provided was a decrease in accounts receivable levels stemming from cash collections on customer sales. These were partially offset by a decrease in payable and accrual levels and increases in inventory levels and deposits made to vendors included in other current assets. Of particular note during the first six months of 2024 were net earnings of $12,645,000, which included non-cash depreciation and amortization expenses of $2,684,000. Contributing to the cash used were increases in accounts receivable and inventory levels, as well as a decrease in federal and state taxes due.

Current wording

Net cash used in operating activities was $23,054,000 during the first nine months of 2025 as compared to $45,793,000 cash used during the first nine months of 2024. The principal factors contributing to the change can be found in the changes in the components of working capital within the Consolidated Statements of Cash Flows. Of particular note during the first nine months of 2025 were net earnings of $18,079,000, which included the non-cash impairment of a vendor deposit of $2,701,000 and depreciation and amortization expenses of $3,747,000. Contributing to the cash used were increases in accounts receivable and inventory levels, partially offset by net increases in payable and accrual levels. Of particular note during the first nine months of 2024 were net earnings of $20,728,000, which included non-cash depreciation and amortization expenses of $3,877,000. Contributing to the cash used were increases in inventory levels, as well as a net decrease in payable and accrual levels. These were partially offset by decreases in accounts receivable levels stemming from cash collections on customer sales and deposits made to vendors included in other current assets.

Previous wording

Net cash used in investing activities was $23,062,000 for the first six months of 2025, and net cash provided by investing activities was $4,758,000 for the first six months of 2024. Significant factors contributing to the change were net maturities and sales of marketable securities of $1,983,000 in 2025, and $5,576,000 in 2024; and purchases of property, plant and equipment of $25,449,000 in 2025, as opposed to $1,048,000 in 2024.

Current wording

Net cash used in investing activities was $22,398,000 for the first nine months of 2025, while net cash provided by investing activities was $5,981,000 for the first nine months of 2024. Significant factors contributing to the change were net maturities and sales of marketable securities of $2,476,000 in 2025, and $9,624,000 in 2024; and purchases of property, plant and equipment of $25,555,000 in 2025, as opposed to $3,873,000 in 2024.

Previous wording

Net cash provided by financing activities was $5,614,000 for the first six months of 2025, and net cash used in financing activities was $31,516,000 for the first six months of 2024. The change primarily relates to the annual dividend payments. There was no extra dividend payment during 2025. In 2024, the extra dividend was $3.50 per share. Also contributing to the change were net proceeds from the Company’s line of credit of $12,636,000 in 2025. Cash flows for both six month periods also reflected the proceeds from the sale of treasury stock to a Company sponsored retirement plan. During 2025, the Company incurred interest expense of $75,000 related to its line of credit.

Current wording

Net cash provided by financing activities was $29,878,000 for the first nine months of 2025, while net cash used in financing activities was $31,516,000 for the first nine months of 2024. The change primarily relates to net proceeds from the Company's line of credit in 2025 of $36,900,000, as well as the annual dividend payments. There was no extra dividend payment during 2025. In 2024, the extra dividend was $3.50 per share. Cash flows for both nine month periods also reflected the proceeds from the sale of treasury stock to a Company sponsored retirement plan. During 2025 and 2024, the Company incurred interest expense of $299,000 and $2,000 related to its line of credit, respectively.

Previous wording

Working capital decreased by $13,866,000 during the first six months of 2025 to $278,359,000 at June 29, 2025 for the reasons stated above. The Company's current ratio was 4.2 to 1.0 and 4.9 to 1.0 at June 29, 2025 and December 31, 2024, respectively.

Current wording

Working capital decreased by $6,828,000 during the first nine months of 2025 to $285,397,000 at September 28, 2025 for the reasons stated above. The Company's current ratio was 3.5 to 1.0 and 4.9 to 1.0 at September 28, 2025 and December 31, 2024, respectively.