MANNATECH INC

Management's Statement

The Company experienced an increase in costs during the period, driven by a combination of factors including rising tariffs, global supply chain pressures, and the broader geopolitical climate. Evolving trade policies and the imposition of new or expanded tariffs have contributed to higher input costs, increased logistics expenses, and greater supplier pricing volatility. These dynamics, amplified by ongoing geopolitical uncertainties, have placed incremental pressure on our cost structure and margins. The Company continues to monitor these developments closely and is actively pursuing mitigation strategies, including supplier diversification, pricing adjustments, and operational efficiencies. However, our ability to fully offset these impacts may be constrained by operational capacity, supplier limitations, and continued market volatility, particularly in the near term. Should geopolitical tensions and trade policy conditions persist or deteriorate further, there could be a continued adverse effect on our costs, margins, and overall financial performance.