KENNAMETAL INC

Previous wording

Our sales of $498.0 million for the three months ended September 30, 2025 increased 3 percent from $481.9 million in the prior year quarter, reflecting an organic sales growth of 3 percent and a favorable currency exchange effect of 1 percent, partially offset by a divestiture effect of 1 percent.

Current wording

Our sales of $529.5 million for the three months ended December 31, 2025 increased 10 percent from $482.1 million in the prior year quarter, reflecting organic sales growth of 10 percent and a favorable currency exchange effect of 1 percent, partially offset by a divestiture effect of 1 percent.

Previous wording

Operating income for the three months ended September 30, 2025 was $37.6 million compared to $36.0 million in the prior year quarter. The year-over-year increase of $1.5 million was driven by pricing and tariff surcharges and incremental year-over-year restructuring savings of approximately $8 million, partially offset by higher compensation costs, tariffs and general inflation, a prior year benefit from net insurance proceeds of $4 million that did not repeat in the current year and an increase in incremental restructuring and related charges of approximately $3 million.

Current wording

Operating income for the three months ended December 31, 2025 was $52.7 million compared to $31.7 million in the prior year quarter. The year-over-year increase of $21.0 million was driven by the favorable timing of pricing compared to raw material costs of approximately $17 million within the Infrastructure segment, pricing and tariff surcharges within the Metal Cutting segment, higher sales and production volumes in Metal Cutting, and incremental year-over-year restructuring savings of approximately $8 million. These factors were partially offset by higher compensation costs, tariffs and general inflation, a prior year benefit from insurance proceeds of approximately $3 million that did not repeat in the current year and an increase in incremental restructuring and related charges of approximately $2 million.

Previous wording

Operating margin for the three months ended September 30, 2025 was 7.5 percent compared to 7.5 percent in the prior year quarter. The Metal Cutting and Infrastructure segments had operating margins of 6.9 percent and 8.9 percent, respectively, for the three months ended September 30, 2025.

Current wording

Operating margin for the three months ended December 31, 2025 was 9.9 percent compared to 6.6 percent in the prior year quarter. The Metal Cutting and Infrastructure segments had operating margins of 9.0 percent and 11.8 percent, respectively, for the three months ended December 31, 2025.

Previous wording

For the three months ended September 30, 2025, earnings per diluted share (EPS) was $0.30 compared to EPS of $0.28 in the prior year quarter.

Current wording

For the three months ended December 31, 2025, earnings per diluted share (EPS) was $0.44 compared to EPS of $0.23 in the prior year quarter.

Previous wording

Net cash flow provided by operating activities was $17.5 million during the three months ended September 30, 2025 compared to $45.7 million during the prior year period. Capital expenditures were $23.0 million and $24.7 million during the three months ended September 30, 2025 and 2024, respectively. During the three months ended September 30, 2025, the Company returned $25.1 million to shareholders through $10.0 million in share repurchases and $15.1 million in dividends. The Company has a long history of consistently paying dividends to shareholders since its listing on the New York Stock Exchange in 1967.

Current wording

Net cash flow provided by operating activities was $72.6 million during the six months ended December 31, 2025 compared to $100.9 million during the prior year period. Capital expenditures were $35.7 million and $44.0 million during the six months ended December 31, 2025 and 2024, respectively. During the six months ended December 31, 2025, the Company returned $40.5 million to shareholders through $10.1 million in share repurchases and $30.4 million in dividends. The Company has a long history of consistently paying dividends to shareholders since its listing on the New York Stock Exchange in 1967.

Previous wording

SALES Sales for the three months ended September 30, 2025 were $498.0 million, an increase of $16.0 million, or 3 percent, from $481.9 million in the prior year quarter, reflecting organic sales growth of 3 percent and a favorable currency exchange effect of 1 percent, partially offset by a divestiture effect of 1 percent.

Current wording

SALES Sales for the three months ended December 31, 2025 were $529.5 million, an increase of $47.5 million, or 10 percent, from $482.1 million in the prior year quarter, reflecting organic sales growth of 10 percent and a favorable currency exchange effect of 1 percent, partially offset by a divestiture effect of 1 percent.

Previous wording

Our sales growth (decline) by end market and region are as follows:

Current wording

Our sales growth by end market and region are as follows:

Previous wording

GROSS PROFIT Gross profit for the three months ended September 30, 2025 was $154.6 million, an increase of $3.5 million from $151.0 million in the prior year quarter. The increase was driven by pricing and tariff surcharges and incremental year-over-year restructuring savings, partially offset by higher compensation costs, tariffs and general inflation, and a prior year benefit from net insurance proceeds of $4 million that did not repeat in the current year. Gross profit margin for the three months ended September 30, 2025 was 31.0 percent, as compared to 31.3 percent in the prior year quarter.

Current wording

GROSS PROFIT Gross profit for the three months ended December 31, 2025 was $173.9 million, an increase of $28.8 million from $145.0 million in the prior year quarter. The increase was driven by the favorable timing of pricing compared to raw material costs of approximately $17 million within the Infrastructure segment, pricing and tariff surcharges within the Metal Cutting segment, higher sales and production volumes in the Metal Cutting segment, and incremental year-over-year restructuring savings. These factors were partially offset by higher compensation costs, tariffs and general inflation, and a prior year benefit from insurance proceeds of approximately $3 million that did not repeat in the current year. Gross profit margin for the three months ended December 31, 2025 was 32.8 percent, as compared to 30.1 percent in the prior year quarter.

Previous wording

OPERATING EXPENSE Operating expense for the three months ended September 30, 2025 was $113.0 million compared to $111.7 million for the three months ended September 30, 2024.

Current wording

OPERATING EXPENSE Operating expense for the three months ended December 31, 2025 was $116.3 million compared to $109.3 million for the three months ended December 31, 2024. Operating expense for the six months ended December 31, 2025 was $229.3 million compared to $221.0 million for the six months ended December 31, 2024.

Previous wording

Research and development expenses included in operating expense totaled $10.6 million and $11.1 million for the three months ended September 30, 2025 and 2024, respectively.

Current wording

Research and development expenses included in operating expense totaled $10.3 million and $11.0 million for the three months ended December 31, 2025 and 2024, respectively, and $20.9 million and $22.1 million for the six months ended December 31, 2025 and 2024, respectively.

Previous wording

RESTRUCTURING AND OTHER CHARGES, NETIn January 2025, we announced several actions to support the long-term competitiveness of the Company and to mitigate softer market conditions. Total restructuring and related charges for this program of $15.6 million, compared to a target of approximately $25 million, were recorded through September 30, 2025, consisting of $13.0 million in Metal Cutting and $2.6 million in Infrastructure. The Company substantially completed the closure of a facility in Greenfield, MA and the consolidation of facilities in Barcelona, Spain during 2025 as a part of these actions.

Current wording

RESTRUCTURING AND OTHER CHARGES, NETIn January 2025, we announced several actions to support the long-term competitiveness of the Company and to mitigate softer market conditions. Total restructuring and related charges for this program of $18.6 million, compared to a revised target of approximately $20 million, were recorded through December 31, 2025, consisting of $15.1 million in Metal Cutting and $3.6 million in Infrastructure. The Company substantially completed the closure of a facility in Greenfield, MA and the consolidation of facilities in Barcelona, Spain during 2025 as a part of these actions.

Previous wording

We recorded restructuring and related charges of $3.2 million for the three months ended September 30, 2025, which consisted of $3.3 million in Metal Cutting and a reversal of $0.1 million in Infrastructure. Included in this amount was restructuring related charges of $1.6 million included in cost of goods sold.

Current wording

We recorded restructuring and related charges of $1.4 million for the three months ended December 31, 2024, which consisted of $1.2 million in Metal Cutting and $0.2 million in Infrastructure. We recorded restructuring and related charges of $2.0 million for the six months ended December 31, 2024, which consisted of $1.8 million in Metal Cutting and $0.2 million in Infrastructure.

Previous wording

INTEREST EXPENSE Interest expense for the three months ended September 30, 2025 decreased to $6.2 million compared to $6.3 million for the three months ended September 30, 2024.

Current wording

INTEREST EXPENSE Interest expense for the three months ended December 31, 2025 decreased to $6.1 million compared to $6.2 million for the three months ended December 31, 2024. Interest expense for the six months ended December 31, 2025 decreased to $12.3 million compared to $12.5 million for the six months ended December 31, 2024.

Previous wording

OTHER INCOME, NET Other income, net for the three months ended September 30, 2025 was $2.3 million compared to $1.7 million during the three months ended September 30, 2024. The increase in other income was primarily due to foreign currency transaction gains including preferential exchange rates in Bolivia.

Current wording

OTHER INCOME, NET Other income, net for the three months ended December 31, 2025 was $2.1 million compared to $1.5 million during the three months ended December 31, 2024. Other income, net for the six months ended December 31, 2025 was $4.4 million compared to $3.1 million during the six months ended December 31, 2024. The increase in other income was primarily due to foreign currency transaction gains including preferential exchange rates in Bolivia, partially offset by higher net periodic pension expense in the current year.

Previous wording

PROVISION FOR INCOME TAXESThe effective income tax rates for the three months ended September 30, 2025 and 2024 were 26.9 percent and 25.2 percent, respectively. The year-over-year change is primarily due to benefits recorded in the current year quarter for the advanced manufacturing production credit and a tax rate change enacted in Germany, a benefit recorded in the prior year quarter for interest received to resolve an income tax dispute in India and geographical mix.

Current wording

PROVISION FOR INCOME TAXESThe effective income tax rates for the three months ended December 31, 2025 and 2024 were 27.7 percent and 29.4 percent, respectively. The year-over-year change is primarily due to favorable geographical mix which was partially offset by a charge recorded in the current year quarter for an income tax audit settlement in China and a benefit recorded in the prior year quarter for the advanced manufacturing production credit.

Previous wording

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA), which includes a broad range of tax reform provisions, was signed into law in the United States. We do not expect the OBBBA to have a material impact on our consolidated financial statements in the current fiscal year and are currently evaluating the potential impact it will have on future periods.

Current wording

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA), which includes a broad range of tax reform provisions, was signed into law in the United States. We do not expect the OBBBA to have a material impact on our consolidated financial statements.

Previous wording

For the three months ended September 30, 2025, Metal Cutting sales increased 5 percent compared to the prior year quarter. This was driven by an organic sales growth of 3 percent and a favorable currency exchange effect of 2 percent. Aerospace & Defense end market sales increased in the Americas, EMEA and Asia Pacific as a result of higher volume in the Americas and global strategic focus. Energy end market sales increased in the Americas and to a lesser extent in Asia Pacific primarily due to our strategic focus, the effects of which were partially offset by lower market activity in EMEA. Sales in the General Engineering end market increased in EMEA and Asia Pacific due to slightly higher industrial activity, partially offset by a decrease in the Americas. Transportation end market sales decreased in Asia Pacific due to project timing, and to a lesser extent in EMEA as a result of a decline in vehicle production, the effects of which were partially offset by favorable currency exchange and an increase in the Americas.

Current wording

For the six months ended December 31, 2025, Metal Cutting sales increased 8 percent compared to the prior year period. The increase was driven by an organic sales growth of 6 percent and a favorable currency exchange effect of 2 percent. Aerospace & Defense end market sales increased as a result of improved build rates in the Americas, easing supply chain pressures in EMEA and our global strategic focus. Energy end market sales increased in the Americas and Asia Pacific primarily due to our strategic focus. Sales in the General Engineering end market increased primarily due to order timing within the indirect channel and pricing. Transportation end market sales increased primarily in the Americas due to light vehicle production and pricing as well as favorable currency exchange, the effects of which were partially offset by declines in Asia Pacific due to project timing and EMEA due to a decline in vehicle production.

Previous wording

For the three months ended September 30, 2025, Metal Cutting operating income was $21.6 million compared to $23.8 million in the prior year quarter. The decrease in operating income was primarily due to higher compensation costs, tariffs and general inflation, and incremental restructuring and related charges of approximately $3 million, partially offset by pricing and tariff surcharges and incremental year-over-year restructuring savings of approximately $6 million.

Current wording

For the six months ended December 31, 2025, Metal Cutting operating income was $51.3 million compared to $40.4 million in the prior year period. The increase in operating income was primarily due to pricing and tariff surcharges, incremental year-over-year restructuring savings of approximately $12 million, and higher sales and production volumes, partially offset by higher compensation costs, tariffs and general inflation, and an increase in incremental restructuring and related charges of approximately $4 million.

Previous wording

For the three months ended September 30, 2025, Infrastructure sales increased 1 percent from the prior year quarter. This was driven by an organic sales growth of 3 percent and a favorable currency exchange effect of 1 percent, partially offset by a divestiture effect of 3 percent. Aerospace & Defense end market sales increased in EMEA and the Americas as a result of project timing and the execution of our growth initiatives. Earthworks end market sales increased as a result of higher global construction demand, especially in the Americas partially due to order timing, partially offset by a decline in Asia Pacific mining stemming from lower customer capital investment from lower coal prices. Sales in the General Engineering end market increased in the Americas and Asia Pacific due to higher demand, offset by declines in EMEA due to softer market conditions and order timing. Energy end market sales decreased in EMEA and the Americas due to order timing and lower global oil and gas activities as rig counts decreased year-over-year.

Current wording

For the three months ended December 31, 2025, Infrastructure sales increased 8 percent from the prior year quarter. The increase was driven by an organic sales growth of 11 percent and a favorable currency exchange effect of 1 percent, partially offset by a divestiture effect of 4 percent. Aerospace & Defense end market sales increased primarily in the Americas as a result of the execution of our growth initiatives and project timing. Earthworks end market sales increased as a result of share gains in mining and higher global construction volumes due to buy-ahead and share gains. Sales in the General Engineering end market increased in the Americas and Asia Pacific due to pricing, share gains, project timing and buy-ahead, partially offset by the effect of a divestiture and a decline in EMEA due to lower ceramics sales. Energy end market sales increased in the Americas due to pricing, which was offset by the effect of a divestiture, declines in EMEA and Asia Pacific from softer market conditions and order timing, and unfavorable currency exchange.

Previous wording

For the three months ended September 30, 2025, Infrastructure operating income was $16.6 million compared to $12.7 million in the prior year quarter. The increase in operating income was driven by pricing and incremental year-over-year restructuring savings of approximately $2 million, partially offset by a prior year benefit from net insurance proceeds of $4 million that did not repeat in the current year, and higher compensation costs and general inflation.

Current wording

For the three months ended December 31, 2025, Infrastructure operating income was $23.4 million compared to $15.6 million in the prior year quarter. The increase in operating income was driven by the favorable timing of pricing compared to raw material costs of approximately $17 million, and incremental year-over-year restructuring savings of approximately $2 million. These factors were partially offset by higher compensation costs, a prior year benefit from net insurance proceeds of approximately $3 million that did not repeat in the current year and general inflation.

Previous wording

For the three months ended September 30, 2025, Corporate expense increased by $0.1 million from the prior year quarter.

Current wording

For the three months ended December 31, 2025, Corporate expense decreased by an immaterial amount from the prior year quarter. For the six months ended December 31, 2025, Corporate expense increased by $0.1 million from the prior year quarter.

Previous wording

Cash flow from operations is the primary source of funding for our capital expenditures. For the three months ended September 30, 2025, cash flow provided by operating activities was $17.5 million.

Current wording

Cash flow from operations is the primary source of funding for our capital expenditures. For the six months ended December 31, 2025, cash flow provided by operating activities was $72.6 million.

Previous wording

During fiscal 2022, we entered into the Sixth Amended and Restated Credit Agreement dated as of June 14, 2022 (the Credit Agreement). The Credit Agreement is a five-year, multi-currency, revolving credit facility, which we use to augment cash from operations and as an additional source of funds. The Credit Agreement provides for revolving credit loans of up to $700.0 million for working capital, capital expenditures and general corporate purposes. The Credit Agreement allows for borrowings in U.S. dollars, euros, pounds sterling and Japanese yen. Interest payable under the Credit Agreement is based upon the type of borrowing under the facility and may be (1) Euro Interbank Offered Rate (EURIBOR), Sterling Overnight Index Average (SONIA), Tokyo Interbank Offered Rate (TIBOR), and Secured Overnight Financing Rate (SOFR) for any borrowings in euros, pounds sterling, yen, and U.S. dollars, respectively, plus an applicable margin, (2) the greater of the prime rate or the Federal Funds effective rate plus an applicable margin, or (3) fixed as negotiated by us. The Credit Agreement matures in June 2027.

Current wording

During the three months ended December 31, 2025, we entered into the Seventh Amended and Restated Credit Agreement dated as of November 17, 2025 ( the Credit Agreement). The Credit Agreement is a five-year, multi-currency, revolving credit facility, which we use to augment cash from operations and as an additional source of funds. The Credit Agreement allows for borrowings in U.S. dollars, Canadian dollars, euros, pounds sterling and Japanese yen. Interest payable under the Credit Agreement is based upon the type of borrowing under the facility and may be (1) Euro Interbank Offered Rate (EURIBOR), Sterling Overnight Index Average (SONIA), Canadian Overnight Repo Rate Average (CORRA), Tokyo Interbank Offered Rate (TIBOR) and Secured Overnight Financing Rate (SOFR) for any borrowings in euros, pounds sterling, Canadian dollars, yen and U.S. dollars, respectively, plus an applicable margin, (2) the greater of the prime rate or the Federal Funds effective rate plus an applicable margin, or (3) fixed as negotiated by us. The Credit Agreement matures in November 2030.

Previous wording

The Credit Agreement requires us to comply with various restrictive and affirmative covenants, including one financial covenant: a maximum leverage ratio where debt, net of domestic cash in excess of $25 million and sixty percent of the unrestricted cash held outside of the United States, must be less than or equal to 3.75 times trailing twelve months EBITDA, adjusted for certain non-cash expenses.

Current wording

The Credit Agreement requires us to comply with various restrictive and affirmative covenants, including one financial covenant: a maximum leverage ratio where debt, net of domestic cash and sixty percent of the unrestricted cash held outside of the United States, must be less than or equal to 3.75 times trailing twelve months EBITDA, adjusted for certain non-cash expenses.

Previous wording

As of September 30, 2025, we were in compliance with all the covenants of the Credit Agreement, and there were no borrowings outstanding and $700.0 million of additional availability. There were no borrowings outstanding as of June 30, 2025.

Current wording

As of December 31, 2025, we were in compliance with all the covenants of the Credit Agreement, and there were no borrowings outstanding and $650.0 million of additional availability. There were no borrowings outstanding as of June 30, 2025.

Previous wording

At September 30, 2025, cash and cash equivalents were $103.5 million. Total Kennametal shareholders' equity was $1,284.2 million and total debt was $598.4 million. Our current senior credit ratings are at investment grade levels. We believe that our current financial position, liquidity and credit ratings provide us access to the capital markets. We believe that we have sufficient resources available to meet cash requirements for the next 12 months. We continue to closely monitor our liquidity position and the condition of the capital markets, as well as the counterparty risk of our credit providers. There have been no material changes in our contractual obligations and commitments since June 30, 2025.

Current wording

At December 31, 2025, cash and cash equivalents were $129.3 million. Total Kennametal shareholders' equity was $1,315.0 million and total debt was $598.6 million. Our current senior credit ratings are at investment grade levels. We believe that our current financial position, liquidity and credit ratings provide us access to the capital markets. We believe that we have sufficient resources available to meet cash requirements for the next 12 months. We continue to closely monitor our liquidity position and the condition of the capital markets, as well as the counterparty risk of our credit providers. There have been no material changes in our contractual obligations and commitments since June 30, 2025.

Previous wording

Share Repurchase Program In February 2024, the Board of Directors of the Company authorized the Company to purchase up to $200 million of the Company's common stock over a three-year period. During the three months ended September 30, 2025, the Company repurchased $10 million of Kennametal common stock.

Current wording

Share Repurchase Program In February 2024, the Board of Directors of the Company authorized the Company to purchase up to $200 million of the Company's common stock over a three-year period. During the three and six months ended December 31, 2025, the Company repurchased an immaterial amount and $10 million, respectively, of Kennametal common stock. Inception-to-date the Company has repurchased $70 million of Kennametal common stock under the $200 million three-year program.

Previous wording

Dividends During the three months ended September 30, 2025, the Company paid a total of $15.1 million in dividends to Kennametal Shareholders.

Current wording

Dividends During the six months ended December 31, 2025, the Company paid a total of $30.4 million in dividends to Kennametal Shareholders.

Previous wording

During the three months ended September 30, 2025, cash flow provided by operating activities was $17.5 million, compared to $45.7 million for the prior year period. Cash flow provided by operating activities for the current year period consisted of net income and non-cash items amounting to an inflow of $70.3 million and changes in certain assets and liabilities netting to an outflow of $52.8 million. Contributing to the changes in certain assets and liabilities were an increase in inventories of $28.0 million, an increase in other, primarily prepaid assets, of 15.1 million and a decrease in accounts payable and accrued liabilities of $13.5 million. Partially offsetting these cash outflows was a decrease in accounts receivable of $7.0 million.

Current wording

During the six months ended December 31, 2025, cash flow provided by operating activities was $72.6 million, compared to $100.9 million for the prior year period. Cash flow provided by operating activities for the current year period consisted of net income and non-cash items amounting to an inflow of $149.8 million and changes in certain assets and liabilities netting to an outflow of $77.2 million. Contributing to the changes in certain assets and liabilities were an increase in inventories of $84.1 million and an increase in other, primarily prepaid assets, of $17.5 million. Partially offsetting these cash outflows was an increase in accounts payable and accrued liabilities of $14.7 million and a decrease in accounts receivable of $7.8 million.

Previous wording

During the three months ended September 30, 2024, cash flow provided by operating activities was $45.7 million and consisted of net income and non-cash items amounting to an inflow of $61.1 million and changes in certain assets and liabilities netting to an outflow of $15.3 million. Contributing to the changes in certain assets and liabilities were a decrease in accounts payable and accrued liabilities of $22.3 million and an increase in inventories of $17.5 million. Partially offsetting these cash outflows was a decrease in accounts receivable of $26.6 million.

Current wording

During the six months ended December 31, 2024, cash flow provided by operating activities was $100.9 million and consisted of net income and non-cash items amounting to an inflow of $118.7 million and changes in certain assets and liabilities netting to an outflow of $17.8 million. Contributing to the changes in certain assets and liabilities were an increase in inventories of $30.7 million and a decrease in accounts payable and accrued liabilities of $27.2 million. Partially offsetting these cash outflows was a decrease in accounts receivable of $43.2 million.

Previous wording

Cash flow used in investing activities was $22.7 million for the three months ended September 30, 2025, compared to $20.0 million for the prior year period. During the current year period, cash flow used in investing activities included capital expenditures of $23.0 million, which consisted primarily of equipment upgrades.

Current wording

Cash flow used in investing activities was $33.8 million for the six months ended December 31, 2025, compared to $36.6 million for the prior year period. During the current year period, cash flow used in investing activities included capital expenditures of $35.7 million, which consisted primarily of equipment upgrades.

Previous wording

Cash flow used in investing activities was $20.0 million for the three months ended September 30, 2024 and primarily included capital expenditures of $24.7 million, which consisted primarily of equipment upgrades, partially offset by proceeds from insurance recoveries of $4.7 million.

Current wording

Cash flow used in investing activities was $36.6 million for the six months ended December 31, 2024, including capital expenditures of $44.0 million, which consisted primarily of equipment upgrades, partially offset by proceeds from insurance recoveries of $7.2 million.

Previous wording

Cash flow used in financing activities was $31.1 million for the three months ended September 30, 2025 compared to $36.4 million in the prior year period. During the current year period, cash flow used in financing activities primarily included $15.1 million of cash dividends paid to Kennametal Shareholders, $10.0 million in common shares repurchased and $6.3 million of the effect of employee benefit and stock plans and dividend reinvestment.

Current wording

Cash flow used in financing activities was $49.6 million for the six months ended December 31, 2025 compared to $68.0 million in the prior year period. During the current year period, cash flow used in financing activities primarily included $30.4 million of cash dividends paid to Kennametal Shareholders, $10.1 million in common shares repurchased and $7.7 million of the effect of employee benefit and stock plans and dividend reinvestment.

Previous wording

Cash flow used in financing activities was $36.4 million for the three months ended September 30, 2024 and primarily included $15.6 million of cash dividends paid to Kennametal Shareholders, $15.0 million in common shares repurchased and $5.8 million of the effect of employee benefit and stock plans and dividend reinvestment.

Current wording

Cash flow used in financing activities was $68.0 million for the six months ended December 31, 2024 and primarily included $31.1 million of cash dividends paid to Kennametal Shareholders, $30.1 million in common shares repurchased and $6.2 million of the effect of employee benefit and stock plans and dividend reinvestment.

Previous wording

Working capital was $635.8 million at September 30, 2025, an increase of $18.9 million from $616.9 million at June 30, 2025. The increase in working capital was primarily driven by an increase in inventories of $27.0 million, a decrease in other current liabilities of $13.4 million, an increase in other current assets of $11.0 million and a decrease of accrued expenses of $7.3 million, partially offset by a decrease in cash and cash equivalents of $37.0 million and a decrease in accounts receivable of $7.4 million. Currency exchange rate effects decreased working capital by a total of approximately $2.0 million, the effects of which are included in the aforementioned changes.

Current wording

Working capital was $681.9 million at December 31, 2025, an increase of $65.0 million from $616.9 million at June 30, 2025. The increase in working capital was primarily driven by an increase in inventories of $83.7 million resulting from rising tungsten prices, an increase in other current assets of $16.7 million, which consisted primarily of prepaid assets, a decrease of accrued expenses of $8.9 million and a decrease in other current liabilities of $5.7 million, partially offset by an increase in accounts payable of $24.5 million, a decrease in cash and cash equivalents of $11.2 million, a decrease in accounts receivable of $7.2 million and an increase in accrued income taxes of $6.6 million. Currency exchange rate effects decreased working capital by a total of approximately $0.9 million, the effects of which are included in the aforementioned changes.

Previous wording

Property, plant and equipment, net decreased $22.1 million from $919.9 million at June 30, 2025 to $897.9 million at September 30, 2025, primarily due to depreciation expense of $32.7 million and currency exchange effects of $0.5 million, partially offset by net capital additions of $23.0 million.

Current wording

Property, plant and equipment, net decreased $38.6 million from $919.9 million at June 30, 2025 to $881.3 million at December 31, 2025, primarily due to depreciation expense of $64.7 million, partially offset by net capital additions of $34.1 million and currency exchange effects of $0.8 million.

Previous wording

At September 30, 2025, total other assets were $588.3 million, an increase of $2.0 million from $586.2 million at June 30, 2025. The increase was primarily due to an increase in other of $7.4 million, partially offset by amortization of intangibles of $2.4 million, a decrease in lease right-of-use assets of $2.4 million and currency exchange rate effects of approximately $0.6 million.

Current wording

At December 31, 2025, total other assets were $593.0 million, an increase of $6.7 million from $586.2 million at June 30, 2025. The increase was primarily due to an increase in other of $11.7 million, which consisted primarily of pension assets and long-term prepaid assets, partially offset by amortization of intangibles of $4.8 million. Currency exchange rate effects were approximately $0.5 million, the effects of which are included in the aforementioned changes.

Previous wording

Kennametal Shareholders' equity was $1,284.2 million at September 30, 2025, an increase of $0.2 million from $1,284.0 million at June 30, 2025. The increase was primarily due to net income attributable to Kennametal of $23.3 million, and capital stock issued under employee benefit and stock plans of $1.9 million and other comprehensive income attributable to Kennametal of $0.2 million, partially offset by cash dividends paid to Kennametal Shareholders of $15.1 million and the repurchase of capital stock of $10.0 million primarily under the share repurchase program.

Current wording

Kennametal Shareholders' equity was $1,315.0 million at December 31, 2025, an increase of $31.1 million from $1,284.0 million at June 30, 2025. The increase was primarily due to net income attributable to Kennametal of $57.2 million, capital stock issued under employee benefit and stock plans of $7.3 million and other comprehensive income attributable to Kennametal of $4.9 million, partially offset by cash dividends paid to Kennametal Shareholders of $30.4 million and the repurchase of capital stock of $10.1 million primarily under the share repurchase program.

Previous wording

Reconciliations of constant currency end market sales (decline) growth to end market sales (decline) growth(2) are as follows:

Current wording

Reconciliations of constant currency end market sales growth (decline) to end market sales growth (decline)(2) are as follows: