GLOBAL INDUSTRIAL Co
For the period ended Sep 30, 2026. Filed Nov 3, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 3, 2026
GIC$46.40-1.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-04.
0001628280-26-052687
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-03.
0001437749-26-034695
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 106 previous paragraphs and 76 current paragraphs.
49 unchanged; 23 reworded; 3 added; 34 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 4 previous and 36 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (3)
Current report
Third Quarter 2026 Financial Summary:
Current report
Gross margin was 35.7% in the third quarter of 2026 compared to 35.6% in the same period last year. Gross margin in the third quarter of 2026 benefited by approximately 60 basis points from tariff refunds recorded in the quarter. Transportation costs remain elevated with fuel costs up substantially year over year and further increasing substantially in the last two month's of the quarter. Ocean freight costs have also increased due to shipping disruptions, fuel and weather-related impacts. In addition, Canadian tariffs on U.S. sourced products are creating incremental cost pressures in our Canadian business. Gross margin in the year ago quarter benefited from price capture, partially offset by diminishing favorability of pre-tariff inventory valuation flowing through cost of sales.
Current report
For thenine months ended September 30, 2026, gross margin was 36.9% compared to 35.9% in the same period last year, benefiting by approximately 200 basis points from tariff refunds recorded in 2026. Margin performance also reflects the impact of incremental transportation costs, including ocean freight cost increases, as well as product and channel mix.
Removed paragraphs (34)
Previous report
•general economic conditions, such as customer inventory levels, consumer prices and inflation, interest rates, borrowing ability and economic conditions in the manufacturing and/or distribution industries generally, as well as government spending levels will continue to impact our business;
Previous report
•global, political, economic and market conditions, including the impact of natural disasters, military actions, wars, international shipping disruptions, cyber-attacks, terrorism and global pandemics or other health crises;
Previous report
•delays in the timely availability of products from our suppliers has in the past and could in the future delay receipt of needed product, resulting in delayed or lost sales;
Previous report
•global supply chains and the timely availability of products, particularly products, or product components used in domestic manufacturing, imported from China and other Asian nations as well as from other countries, have been, and in the future could continue to be adversely affected by allocation restrictions of difficult to source products by our vendors;
Previous report
•we are exposed to market risks from changes in tariff rates and import shipping costs particularly on goods from China and other Asia-based suppliers. These dynamic market conditions may result in fluctuations in our income and cash flows. Recently enacted tariffs on imports and exports with respect to a number of countries in our supply chain and/or customer markets, have increased and may continue to increase our procurement costs, the impact of which will increase pressure on our margins as we sell through lower cost inventory. The imposition of tariffs and other trade barriers, as well as reciprocal trade measures, have caused us to raise the prices on certain of our products and to seek alternate sources of supply. Pricing actions we have taken and may continue to take to mitigate these increased procurement costs could have a material adverse impact on our income, cash flows and overall financial results;
Previous report
•our use of alternate sources of supply, such as utilizing new vendors in additional countries, entails various risks, such as identifying, vetting and managing new business relationships, reliance on new vendors and maintaining quality control over their products, and protecting our intellectual property rights;
Previous report
•increases in freight and shipping costs, including fuel costs and other accessorial costs, could affect our margins to the extent the increases cannot be passed along to customers, as has occurred in the past;
Previous report
•extreme weather conditions have delayed or disrupted global product supply chains and have affected our ability to timely receive and ship products, which have and could adversely impact sales;
Previous report
•other critical factors affecting the shipping and distribution of products imported to the United States by us or our domestic vendors, such as a global shortage in availability of shipping containers, shipping port congestion, and pandemic related labor shortages, have in the past and could in the future adversely affect the timely availability of products, resulting in delayed or lost sales, as well as adversely affecting our margins;
Previous report
•our reliance on common carrier delivery services for shipping merchandise to customers;
Previous report
•our reliance on drop ship deliveries directly to customers by our product vendors for products we do not hold in inventory;
Previous report
•our ability to maintain available capacity in our distribution operations for stocked inventory and to enable on time shipment and deliveries, such as by timely implementing additional temporary or permanent distribution resources, whether in the form of additional facilities we operate or by outsourcing certain functions to third-party distribution and logistics partners;
Previous report
•we compete with other companies for recruiting, training, integrating and retaining talented and experienced employees, particularly in markets where we and they have central distribution facilities; and this aspect of competition is aggravated by the current tight labor market in the U.S. for such jobs;
Previous report
•our ability to realize the expected benefits from acquisitions and other strategic transactions that we believe will either expand or complement our business in new or existing markets or further enhance the value and offerings we are able to provide to our existing or future potential customers;
Previous report
•the maintenance, repair and operation ("MRO") and industrial equipment industry are consolidating as customers are increasingly aware of the total costs of fulfillment and the need to have consistent sources of supply at multiple locations. This consolidation has and will continue to cause the industry to become more competitive as greater economies of scale are achieved by competitors, or as competitors with new lower cost business models are able to operate with lower prices;
Previous report
•risks involved with e-commerce, including possible loss of business and customer dissatisfaction if outages or other computer-related problems should preclude customer access to our products and services;
Previous report
•our information systems and other technology platforms supporting our sales, procurement and other operations are critical to our operations and disruptions or delays have occurred and could occur in the future, and if not timely addressed could have a material adverse effect on us;
Previous report
•a data security breach due to our e-commerce, data storage or other information systems being hacked by those seeking to steal Company, vendor, employee or customer information, or due to employee error, resulting in disruption to our operations, litigation and/or loss of reputation or business;
Previous report
•our ability to remediate material weaknesses in our internal controls over financial reporting and the identification of additional material weaknesses in the future or other failure to maintain an effective system of internal controls;
Previous report
•managing various inventory risks, such as being unable to profitably resell excess or obsolete inventory and/or the loss of product return rights from our vendors;
Previous report
•meeting credit card industry compliance standards in order to maintain our ability to accept credit cards;
Previous report
•rising interest rates, increased borrowing costs or limited credit availability, could impact both our and our customers’ ability to fund purchases and conduct operations in the ordinary course;
Previous report
•quarantines, factory slowdowns or shutdowns, border closings and travel restrictions resulting from pandemics have in the past and could in the future adversely affect the timely availability of products, resulting in delayed or lost sales;
Previous report
•pending or threatened litigation and investigations, and other government actions, such as anti-dumping, unclaimed property, or trade and customs actions by U.S. or foreign governmental authorities, have occurred in the past and although had no material impact to our business, there can be no assurance that such events would not have such impact on our business and results of operation.
Previous report
Second Quarter 2026 Financial Summary:
Previous report
•Consolidated sales increased 7.7% to $386.6 million compared to $358.9 million last year and average daily sales* increased 9.3% compared to prior year.
Previous report
•Consolidated gross margin increased to 40.2% compared to 37.1% last year. Second quarter 2026 results include a gross margin benefit of approximately 550 basis points related to the $21.1 million of IEEPA tariff refunds.
Previous report
•Consolidated operating income from continuing operations increased 47.2% to $49.3 million compared to $33.5 million last year. Second quarter 2026 operating income results include a benefit of approximately $21.1 million of IEEPA tariff refunds.
Previous report
•Net income per diluted share from continuing operations increased 47.7% to $0.96 compared to $0.65 last year. Second quarter 2026 net income per diluted share results include an after tax benefit of approximately $16.4 million, or $0.42 per diluted share, related to the IEEPA tariff refunds.
Previous report
•Consolidated sales increased 8.4% to $737.0 million compared to $679.9 million last year and average daily sales* increased 8.4% compared to prior year.
Previous report
•Consolidated gross margin increased to 37.6% compared to 36.0% last year. Year to date 2026 results include a gross profit benefit of approximately 280 basis points related to the $21.1 million in IEEPA tariff refunds.
Previous report
•Consolidated operating income from continuing operations increased 35.2% to $69.9 million compared to $51.7 million last year. Year to date 2026 operating income results include a benefit of approximately $21.1 million in IEEPA tariff refunds.
Previous report
•Net income per diluted share from continuing operations increased 36.4% to $1.35 compared to $0.99 last year. Year to date 2026 net income per diluted share results include an after tax benefit of approximately $16.4 million, or $0.42 per diluted share, related to the IEEPA tariff refunds.
Previous report
Gross margin was 40.2% in the second quarter of 2026 compared to 37.1% last year, benefiting by approximately 550 basis points related to the $21.1 million IEEPA tariff refund recorded in the quarter. Gross margin in the year ago quarter reached a record 37.1%, benefiting from price capture and temporary favorability of inventory valuation flowing through cost of sales due to the timing of pricing decisions taken in reaction to the implementation of significant tariffs in April 2025. Current quarter gross margins, excluding the 550 basis point benefit from the IEEPA tariff refunds, were more in line with historical performance. For the six months ended June 30, 2026, gross margin was 37.6% compared to 36.0% benefiting by approximately 280 basis points related to the $21.1 million IEEPA tariff refund recorded in the quarter. Margin performance in the quarter and year to date also reflects the impact of incremental fuel surcharges within our transportation network, as well as product and channel mix, which included a lower contribution from our seasonal cooling category compared to the prior year.
Reworded paragraphs (23)
Previous wording
On February 20, 2026, the U.S. Supreme Court held in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act of 1977 (“IEEPA”) does not authorize tariffs. The Court’s decision invalidated the Trump Administration’s IEEPA-based tariff program permanently and in its entirety. During the second quarter of 2026, the Company recorded approximately $26.2 in IEEPA tariff refunds. Approximately $21.1 million of this refund was recorded as a benefit to cost of sales, $1.1 million was recorded to interest income and $4.0 million was recorded to inventory for products that have not yet sold through. The Company expects that the amount remaining in inventory will sell through during the remainder of 2026.
Current wording
On February 20, 2026, the U.S. Supreme Court held inLearning Resources, Inc. v. Trump that the International Emergency Economic Powers Act of 1977 (“IEEPA”) does not authorize tariffs. The Court’s decision invalidated the Trump Administration’s IEEPA-based tariff program permanently and in its entirety. During the third quarter of 2026, the Company recognized a benefit of approximately $2.0 million to cost of sales related to the $26.2 million previously received IEEPA tariff refunds. For the nine months ended September 30, 2026, approximately $23.1 million of this refund was recorded as a benefit to cost of sales, $1.1 million was recorded to interest income and $2.0 million remains in inventory for products that have not yet sold through. The Company expects that the amount remaining in inventory will sell through during the remainder of 2026 and into 2027.
Previous wording
The results of discontinued operations in the accompanying financial statements are from the former North American Technology ("NATG") business. As previously disclosed, in March 2026 the Company's discontinued operations received a refund of prior years alternative minimum taxes paid of approximately $1.8 million which was partially offset by an increased tax obligation recorded in the first quarter of 2026.
Current wording
The Company's discontinued operations include its former North American Technology Group which was sold in December 2015. As previously disclosed, in March 2026 the Company's discontinued operations received a refund of prior years alternative minimum taxes paid of approximately $1.8 million which was partially offset by the settlement of certain liabilities and additional exit cost reserves recorded in the third quarter of 2026.
Previous wording
The primary component of our operating expenses historically has been employee-related costs, which includes items such as wages, commissions, bonuses, employee benefits and equity-based compensation, as well as marketing expenses, primarily comprised of digital marketing spend, and occupancy related charges associated with our leased distribution and call center facilities. We continually assess our operations to ensure that they are efficient, aligned with market conditions and responsive to customer needs.
Current wording
The largest component of our operating expenses historically has been employee-related costs, which includes items such as wages, commissions, bonuses, employee benefits and equity-based compensation, as well as marketing expenses, primarily comprised of digital marketing spend, and occupancy related charges associated with our leased distribution and call center facilities. We continually assess our operations to ensure that they are efficient, aligned with market conditions and responsive to customer needs.
Previous wording
The Company delivered another quarter of strong, broad-based sales growth in our sales channels and customer verticals benefiting from gains in both price and volume. In the second quarter net sales improved 7.7%, with average daily sales growth of 9.3% and was led by our largest strategic accounts. Our Canadian business delivered another strong quarter of sales up 34.1%, 33.7% in local currency. Gross profit in the quarter benefited from $21.1 million of IEEPA tariff refunds recorded which was partially offset by increased transportation costs, as well as product and channel mix. Selling, general and administrative spend for the quarter improved 30 basis points compared to the same period last year.
Current wording
The Company delivered another strong quarter, with sustained sales momentum, improved profitability and continued progress executing our go-to-market strategy. In the third quarter net sales improved 10.2%, with average daily sales growth of 8.5% and was led by our largest strategic accounts. Our Canadian business delivered another strong quarter of sales up 25.9%, 28.3% in local currency. Gross profit in the quarter included 60 basis points of benefit from the recognition of previously received IEEPA tariff refunds, which was partially offset by increased transportation costs, as well as product and channel mix. Selling, general and administrative spend for the quarter improved 90 basis points compared to the same period last year.
Previous wording
We continue to closely monitor the macroeconomic and geopolitical environment, including the ongoing Middle East conflict and their impact on transportation and manufacturing costs, as well as the evolving tariff landscape and new Section 301 tariffs which became effective in July 2026. Our goal is to continue to mitigate these disruptions to our business and our customers and we believe we are well-positioned to do so as we continue to proactively manage price and other factors within our control; however, we anticipate headwinds may impact margin performance in the summer as fuel prices remain elevated.
Current wording
We continue to closely monitor the broader macroeconomic and geopolitical environment, including the ongoing Middle East conflict and their impact on transportation and manufacturing costs, as well as the evolving tariff landscape and Section 301 tariffs, and other sources of volatility. Our goal is to continue to mitigate these disruptions to our business and our customers and we believe we are well-positioned to do so as we continue to proactively manage price and other factors within our control - executing on our strategy and building on the progress we have made.
Previous wording
There were no material changes in the Company’s significant accounting policies during the second quarter ended June 30, 2026.
Current wording
There were no material changes in the Company’s significant accounting policies during the third quarter ended September 30, 2026.
Previous wording
*Average daily sales is calculated based upon the number of selling days in each period, with Canadian sales converted to U.S. dollars using the current year's average exchange rate. There were 63 selling days in the U.S. in the second quarter of 2026 compared to 64 selling days in the second quarter of 2025 and there were 128 selling days in the U.S. for the six months ended June 30, 2026 and 2025, respectively. There were 63 selling days in Canada in each of the second quarters of 2026 and 2025, respectively, and there were 126 selling days in Canada for the six months ended June 30, 2026 and 2025, respectively.
Current wording
*Average daily sales is calculated based upon the number of selling days in each period, with Canadian sales converted to U.S. dollars using the current year's average exchange rate. There were 64 selling days in the U.S. in the third quarter of 2026 compared to 63 selling days in the third quarter of 2025 and there were 192 selling days in the U.S. for the nine months ended September 30, 2026 and 191 selling days in the U.S. for the nine months ended September 30, 2025. There were 63 selling days in Canada in the third quarter of 2026 and 62 selling days in the third quarter of 2025, respectively, and there were 189 selling days in Canada for the nine months ended September 30, 2026 and 188 selling days for the nine months ended September 30, 2025.
Previous wording
Three and Six Months Ended June 30, 2026 compared to the Three and Six Months Ended June 30, 2025
Current wording
Three and Nine Months Ended September 30, 2026 compared to the Three and Nine Months Ended September 30, 2025
Previous wording
The Company's net sales increased 7.7% to $386.6 million during the quarter ended June 30, 2026 compared to $358.9 million last year. For the six months ended June 30, 2026, net sales increased 8.4% to $737.0 million compared to $679.9 million last year. Net sales benefited from both price and volume, with broad based gains across our sales channels and customer verticals. Assigned accounts increased low double digits, led by our largest strategic accounts. U.S. sales increased 6.3% for the second quarter of 2026 compared to the same period in 2025 and year to date sales increased 7.1% compared to prior year. Our Canadian business continued its strong contribution with increased sales of 34.1%, 33.7% in local currency, and 32.3%, 29.3% in local currency, for the three and six months ended June 30, 2026, respectively. On an average daily sales basis, sales grew 9.3% for the quarter ended June 30, 2026 and 8.4% for the six months ended June 30, 2026.
Current wording
The Company's net sales increased 10.2% to $389.5 million during the quarter ended September 30, 2026 compared to $353.6 million in the same period last year. Net sales growth was led by our largest strategic accounts and our industrial and retail verticals. U.S. sales increased 9.3% for the third quarter compared to the same period in 2025. Our Canadian business continued its strong contribution in the third quarter with increased sales of 25.9%, 28.3% in local currency compared to the same period in 2025. For thenine months ended September 30, 2026 net sales increased 9.0% to $1.13 billion compared to $1.03 billion in the same period last year. Net sales benefited from both price and volume, with growth across strategic accounts and our industrial and retail verticals. U.S. sales increased 7.9% compared to prior year and our Canadian business increased sales by 30.1%, 29.0% in local currency. On an average daily sales basis, consolidated sales grew 8.5% for the quarter and nine months ended September 30, 2026.
Previous wording
There were 63 selling days in the U.S. and Canada in the second quarter of 2026 compared to 64 selling days in the U.S. and 63 selling days in Canada in the second quarter of 2025. There were 128 selling days in the U.S. and 126 selling days in Canada for the six months ended June 30, 2026 and 2025, respectively.
Current wording
There were 64 selling days in the U.S. in the third quarter of 2026 compared to 63 selling days in the third quarter of 2025. There were 192 selling days in the U.S. for the nine months ended September 30, 2026 and 191 selling days for the nine months ended September 30, 2025. There were 63 selling days in Canada in the third quarter of 2026 and 62 selling days in the third quarter of 2025. There were 189 selling days in Canada for the nine months ended September 30, 2026 and 188 selling days in Canada for the nine months ended September 30, 2025.
Previous wording
Gross margin is dependent on variables such as product mix including sourcing and category, trade policy inclusive of the imposition of tariffs, competition, pricing strategy, vendor volume rebates, freight pricing decisions including the use of free or other promotional freight plans, freight cost inflation including both domestic outbound freight as well as international inbound ocean freight, inventory valuation and obsolescence and other variables, any or all of which may result in fluctuations in gross margin.
Current wording
Gross margin is dependent on variables such as product mix including sourcing and category, trade policy inclusive of the imposition of tariffs, competition, pricing strategy, vendor volume rebates, freight pricing decisions including the use of free or other promotional freight plans, freight cost inflation including both domestic outbound freight as well as international inbound ocean freight, fuel surcharges related to increasing diesel prices, inventory valuation and obsolescence and other variables, any or all of which may result in fluctuations in gross margin.
Previous wording
For the three and six months ended June 30, 2026, SG&A costs as a percentage of sales improved by 30 basis points compared to prior year. The increase in absolute dollars for the quarter and year to date June 30, 2026 was primarily due to variable compensation, specifically sales commissions, due to strong sales performance. Cost increases in the quarter included total salary and related costs of approximately $4.0 million, of which approximately $1.8 million related to increased sales commissions, $1.8 million of increased salary and related costs and $0.9 million of increased healthcare costs. Cost increases for the six months ended June 30, 2026 included total salary and related costs of approximately $6.8 million, of which approximately $2.4 million related to increased sales commissions, $4.0 million of increased salary costs and $1.5 million of increased healthcare costs.
Current wording
SG&A costs as a percentage of sales improved by 60 basis points for the nine months ended September 30, 2026 as compared to prior year. The increase in absolute dollars for the nine month period was primarily due to variable compensation, specifically sales commissions, due to strong sales performance and increased healthcare costs. Cost increases for the nine months ended September 30, 2026 included total salary and related costs of approximately $10.7 million, of which approximately $4.3 million related to increased sales commissions, $5.1 million of increased salary costs, $2.7 million of increased healthcare costs offset by approximately $2.0 million of adjusted bonus pool. In addition, cost increases of $5.1 million from net advertising spend was incurred for the nine months ended September 30, 2026.
Previous wording
Operating margin for the three and six months ended June 30, 2026 increased 350 basis points and 190 basis points, respectively, compared to the same period in 2025 driven by increased sales, increased gross margin due to the tariff refunds recorded in the second quarter, strong general and discretionary cost control offset by increased sales commissions due to performance and increased salary and healthcare costs.
Current wording
Operating margin for the three and nine months ended September 30, 2026 increased 100 basis points and 160 basis points, respectively, compared to the same period in 2025 driven by increased sales, increased gross margin due to the tariff refunds recorded in the second and third quarter, strong general and discretionary cost control offset by increased sales commissions due to performance and increased salary and healthcare costs.
Previous wording
Interest and other (income) expense, net from continuing operations was $1.0 million and $0.3 million for the three months ended June 30, 2026 and 2025, respectively, and $1.1 million and $0.2 million for the six months ended June 30, 2026 and 2025, respectively. The increase in interest and other income (expense), net was primarily related to interest on IEEPA refunds recorded in the second quarter of 2026 of $1.1 million.
Current wording
Interest and other (income) expense, net from continuing operations was $0.4 million of income compared to $0.2 million of expense for the three months ended September 30, 2026 and 2025, respectively, and $1.5 million income compared to $0.0 million for the nine months ended September 30, 2026 and 2025, respectively. The increase in interest and other income (expense), net for the quarter and nine month period was primarily related to interest earned on higher cash balance resulting from tariff refunds received in 2026.
Previous wording
For the three month period ended June 30, 2026 and 2025, the Company reported income taxes in continuing operations of approximately $13.2 million and $8.7 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states. For the six month period ended June 30, 2026 and 2025, the Company reported income taxes in continuing operations of approximately $18.6 million and $13.3 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states.
Current wording
For the three month period ended September 30, 2026 and 2025, the Company reported income taxes in continuing operations of approximately $8.6 million and $7.3 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states. For the nine month period ended September 30, 2026 and 2025, the Company reported income taxes in continuing operations of approximately $27.2 million and $20.6 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states.
Previous wording
As previously disclosed, in March 2026 the Company's discontinued operations received a refund of prior years alternative minimum taxes paid of approximately $1.8 million related to our NATG discontinued operations. This refund was partially offset by an increased tax obligation recorded in the first quarter of 2026.
Current wording
The Company's discontinued operations include its former North American Technology Group which was sold in December 2015. As previously disclosed, in March 2026 the Company's discontinued operations received a refund of prior years alternative minimum taxes paid of approximately $1.8 million which was partially offset by the settlement of certain liabilities and additional exit cost reserves recorded in the third quarter of 2026.
Previous wording
Our primary liquidity needs are to support working capital requirements in our business, funding recently declared and any future dividends, funding capital expenditures and inventory purchases, continuing investment in upgrading and expanding our technological capabilities specifically related to additional functionality and enhanced navigation of our web platform, continuing investment in sales, marketing, merchandising, customer service and upgrading our distribution footprint and funding acquisitions. We rely upon operating cash flow and our credit facility to meet those needs. We currently believe that current cash on hand, cash flow from operations and our availability under our credit facility will be sufficient to fund our working capital and other cash requirements for at least the next twelve months. We believe our current capital structure and cash resources are adequate for our internal growth initiatives. To the extent our growth initiatives expand, including major acquisitions, we would seek to raise additional capital. We believe that, if needed, we can access public or private funding alternatives to raise additional capital.
Current wording
Our primary liquidity needs are to support working capital requirements in our business, funding recently declared dividends, special dividends and any future dividends, funding capital expenditures and inventory purchases, continuing investment in upgrading and expanding our technological capabilities specifically related to additional functionality and enhanced navigation of our web platform, continuing investment in sales, marketing, merchandising, customer service and upgrading our distribution footprint and funding acquisitions. We rely upon operating cash flow and our credit facility to meet those needs. We currently believe that current cash on hand, cash flow from operations and our availability under our credit facility will be sufficient to fund our working capital and other cash requirements for at least the next twelve months. We believe our current capital structure and cash resources are adequate for our internal growth initiatives. To the extent our growth initiatives expand, including major acquisitions, we would seek to raise additional capital. We believe that, if needed, we can access public or private funding alternatives to raise additional capital.
Previous wording
Our working capital increased $31.0 million primarily related to increased cash balances, including $15.3 million of IEEPA refunds received in the second quarter of 2026, increased accounts receivable balances, including $10.9 million of IEEPA refunds receivable, offset by increased accrued expenses and other current liabilities, accounts payable, inventory and prepaid expenses and other current assets balances. Accounts receivable days outstanding were 39.7 in 2026 compared to 39.0 in 2025, inventory turns were 5.3 in 2026 compared to 5.0 in 2025 and accounts payable days outstanding were 44.2 in 2026 compared to 47.7 in 2025. We expect that future accounts receivable, inventory and accounts payable balances will fluctuate with net sales and the product mix of our net sales.
Current wording
Our working capital increased $48.2 million primarily related to increased cash balances, including $10.9 million from tariff refunds received in the third quarter of 2026, increased accounts receivable balances, offset by increased accrued expenses and other current liabilities, accounts payable, inventory and prepaid expenses and other current assets balances. Accounts receivable days outstanding were 40.4 in 2026 compared to 39.3 in 2025, inventory turns were 5.6 in 2026 compared to 5.0 in 2025 and accounts payable days outstanding were 43.4 in 2026 compared to 47.5 in 2025. We expect that future accounts receivable, inventory and accounts payable balances will fluctuate with net sales and the product mix of our net sales.
Previous wording
Net cash provided by operating activities from continuing operations was $46.0 million in 2026 compared to $35.1 million provided in 2025, attributable to cash generated from net income adjusted by other non-cash items of $60.5 million compared to $46.4 million generated in 2025 primarily due to the higher net income in 2026 from the IEEPA refunds recorded compared to prior year. Changes in working capital accounts used $14.5 million in 2026 compared to $11.3 million used in 2025, primarily the result of the changes in accounts receivable, accrued expenses, other current liabilities and other labilities balanced offset by changes in inventory, accounts payable and income taxes balances. Net cash provided by operating activities from discontinued operations was $1.8 million and $0.0 million for the six months ended June 30, 2026 and 2025, respectively.
Current wording
Net cash provided by operating activities from continuing operations was $90.5 million in 2026 compared to $57.7 million provided in 2025, attributable to cash generated from net income adjusted by other non-cash items of $90.1 million compared to $69.8 million generated in 2025 primarily due to the higher net income in 2026 . Changes in working capital accounts provided $0.4 million in 2026 compared to $12.1 million used in 2025, primarily the result of the changes in inventory, accounts payable and prepaid expenses and other assets balances offset by changes in accounts receivable and accrued expenses, other current liabilities and other liabilities balances. Net cash provided by operating activities from discontinued operations was $1.6 million and $0.1 million for the nine months ended September 30, 2026 and 2025, respectively.
Previous wording
Net cash used in investing activities in 2026 totaled $1.7 million primarily used for warehouse machinery and equipment for distribution facilities, motor vehicles, leasehold improvements, computer software, computer hardware and molds. Net cash used in investing activities totaled $5.6 million in 2025 of which $4.0 million was used for the equipment service provider acquisition and $1.6 million was used for warehouse machinery and equipment for distribution facilities, computer equipment upgrades and molds.
Current wording
Net cash used in investing activities in 2026 totaled $2.7 million primarily used for warehouse machinery and equipment for distribution facilities, motor vehicles, leasehold improvements, computer software, computer hardware and molds. Net cash used in investing activities totaled $6.3 million in 2025 of which $4.0 million was used for the equipment service provider acquisition and $2.3 million was used for warehouse machinery and equipment for distribution facilities, computer equipment upgrades and molds.
Previous wording
Net cash used in financing activities totaled $26.8 million in 2026 primarily related to the regular quarterly dividends of $0.28 per common share which totaled approximately $21.6 million and $5.6 million used for the purchase of treasury stock. Offsetting these payments were proceeds of $0.9 million from the issuance of common stock from our employee stock purchase plan and proceeds of $0.4 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled $0.9 million. In 2025, net cash used in financing activities totaled $18.9 million primarily related to the regular quarterly dividends of $0.26 per common share which totaled approximately $20.1 million. Offsetting these payments were proceeds of $1.2 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled $0.8 million, and proceeds of $0.8 million from the issuance of common stock from our employee stock purchase plan.
Current wording
Net cash used in financing activities totaled $37.5 million in 2026 primarily related to the regular quarterly dividends of $0.28 per common share which totaled approximately $32.3 million and $5.6 million used for the purchase of treasury stock. Offsetting these payments were proceeds of $1.8 million from the issuance of common stock from our employee stock purchase plan and proceeds of $1.0 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled $2.4 million. In 2025, net cash used in financing activities totaled $28.7 million primarily related to the regular quarterly dividends of $0.26 per common share which totaled approximately $30.2 million. Offsetting these payments were proceeds of $2.2 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled $2.2 million, and proceeds of $1.5 million from the issuance of common stock from our employee stock purchase plan.
Previous wording
We maintain our cash and cash equivalents in money market funds or their equivalents that have maturities of less than three months and in non-interest bearing accounts that partially offset banking fees. As of June 30, 2026, we had no investments with maturities of greater than three months. Accordingly, we do not believe that our cash balances have significant exposure to interest rate risk. At June 30, 2026 cash balances held in foreign subsidiaries totaled approximately $7.3 million. These balances are held in local country banks and are held primarily to support local working capital needs. The Company had over $199 million of liquidity (cash and undrawn line of credit) in the U.S. as of June 30, 2026.
Current wording
We maintain our cash and cash equivalents in money market funds or their equivalents that have maturities of less than three months and in non-interest bearing accounts that partially offset banking fees. As of September 30, 2026, we had no investments with maturities of greater than three months. Accordingly, we do not believe that our cash balances have significant exposure to interest rate risk. At September 30, 2026 cash balances held in foreign subsidiaries totaled approximately $5.7 million. These balances are held in local country banks and are held primarily to support local working capital needs. The Company had over $233 million of liquidity (cash and undrawn line of credit) in the U.S. as of September 30, 2026.
Previous wording
We are obligated under non-cancelable operating and finance leases for the rental of our facilities and certain of our equipment which expire at various dates through 2034. As of June 30, 2026 we were obligated for approximately $117.3 million under these non-cancelable leases. In 2026 we anticipate remaining cash expenditures of approximately $9.1 million for these operating leases. We have sublease agreements for unused space, as well as excess space in facilities we are currently occupying in the United States and Canada. In the event the sub lessee is unable to fulfill its obligations, we would be responsible for remaining rents due under the leases.
Current wording
We are obligated under non-cancelable operating and finance leases for the rental of our facilities and certain of our equipment which expire at various dates through 2034. As of September 30, 2026 we were obligated for approximately $111.7 million under these non-cancelable leases. In 2026 we anticipate remaining cash expenditures of approximately $3.5 million for these operating leases. We have sublease agreements for unused space, as well as excess space in facilities we are currently occupying in the United States and Canada. In the event the sub lessee is unable to fulfill its obligations, we would be responsible for remaining rents due under the leases.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
SG&A costs as a percentage of sales improved by 90 basis points in the third quarter of 2026 as compared to the same period in the prior year. The increase in absolute dollars for the quarter was primarily due to variable compensation, specifically sales commissions, due to strong sales performance and increased healthcare costs. Cost increases in the quarter included total salary and related costs of approximately $3.9 million, of which approximately $1.9 million related to increased sales commissions, $1.4 million of increased healthcare costs, $1.1 million of increased salary and related costs offset by approximately $1.3 million of adjusted bonus pool. In addition, cost increases in the quarter included net advertising spend of $1.0 million.