GLOBAL INDUSTRIAL Co
For the period ended Mar 31, 2026. Filed May 5, 2026.
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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.
Mar 31, 2026 · Filed May 5, 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 2025-09-30; filed 2025-10-28.
0001628280-25-046833
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-05.
0001628280-26-030699
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 101 previous paragraphs and 102 current paragraphs.
59 unchanged; 25 reworded; 18 added; 17 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 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 (18)
Current report
Discontinued Operations
Current report
The results of discontinued operations in the accompanying financial statements are from the former North American Technology ("NATG") business. In March 2026 the Company 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 report
The Company delivered a strong start to 2026, driven by solid execution and continued momentum across the business. First quarter revenue improved 9.2%, with average daily sales growth of 7.6% and operating income improved 13.2% compared to prior year. We generated growth each month during the quarter, supported by both price and volume improvement. Performance was led by our largest and most strategic accounts.
Current report
We continue to closely monitor the macroeconomic and geopolitical environment, including developments in the Middle East and their impact on transportation and manufacturing costs, as well as the evolving tariff landscape and potential new Section 301 tariffs which are currently being evaluated by the US Government. Our goal is 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 will impact margin performance in the spring and summer as fuel prices remain elevated.
Current report
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. The Company made material payments on imported goods pursuant to IEEPA tariffs while they were in force. On April 20, 2026, U.S. Customs and Border Protection implemented the Consolidated Administration and Processing of Entries system to facilitate the administration of related tariff refunds. The Company has begun submitting claims for refunds of tariffs paid under IEEPA; however, such claims are subject to review, validation and processing and the timing, amount, and ultimate recoverability of any such refunds remain uncertain.
Current report
First Quarter 2026 Financial Summary:
Current report
•Consolidated sales increased 9.2% to $350.4 million compared to $321.0 million last year and average daily sales* increased 7.6% compared to prior year.
Current report
•Consolidated gross margin decreased to 34.8% compared to 34.9% last year.
Current report
*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 65 selling days in the U.S. in the first quarter of 2026 compared to 64 selling days in the first quarter of 2025. There were 63 selling days in Canada in each of the first quarters of 2026 and 2025, respectively.
Current report
Three Months Ended March 31, 2026 compared to the Three Months Ended March 31, 2025
Current report
NM not meaningful
Current report
The Company's net sales increased 9.2% to $350.4 million during the quarter ended March 31, 2026 compared to $321.0 million last year. Net sales benefited from both price and volume, with gains across both assigned accounts and e-commerce sales channels, and continued strong performance from our largest and most strategic accounts. U.S. sales increased 8.1% for the quarter compared to the same period in 2025 and Canada sales increased 30.3%, 24.4% in local currency, and on an average daily sales basis, sales grew 7.6%, in-line with our fourth quarter performance.
Current report
Gross margin was 34.8% in the first quarter of 2026, a 10 basis point decline, as compared to 34.9% in the same period in 2025, and a 30 basis point improvement compared to the fourth quarter of 2025. Gross margin reflects the impact of incremental fuel surcharges within our outbound transportation in the back half of the quarter, as well as product mix, which was impacted by an increase in the number of large orders/projects during the quarter.
Current report
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (“SG&A”)
Current report
For the three month period ended March 31, 2026, SG&A costs as a percentage of sales improved by 40 basis points compared to the first quarter last year. The increase in absolute dollars was primarily due to planned net marketing costs to support sales growth of approximately $4.2 million, salary and related costs of approximately $2.9 million, inclusive of $0.7 million of increased variable compensation due to performance, offset by $1.2 million savings in separation and stock-based compensation costs.
Current report
INTEREST AND OTHER (INCOME) EXPENSE, NET
Current report
DISCONTINUED OPERATIONS
Current report
In March 2026 the Company 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.
Removed paragraphs (17)
Previous report
As previously reported in our second quarter 2025 Form 10-Q, in April 2025, the Company completed the acquisition of an equipment service provider for approximately $4.3 million in cash. At closing, $0.3 million was held in escrow for the settlement of potential obligations. This acquisition broadens the Company's value-added offerings in certain key equipment categories.
Previous report
The Company generated revenue of $353.6 million, an increase of 3.3% over the year ago period. Results were led by sales to our largest strategic accounts. Gross margin increased 160 basis points over the third quarter of 2024 to 35.6%, benefiting from proactive price management and overall freight cost management. We also benefited in the period from timing associated with the flow through of cost of sales from products purchased prior to the imposition of new tariffs in 2025. Management of our margin profile remains a key area of focus. As we moved through the quarter, we saw the timing benefit of pre-tariff inventory decline and we took pricing actions to mitigate the additional tariff costs that we are incurring. While our goal is to manage to price and cost neutrality, there may be increased volatility in our margin rates given the timing dynamics of on-hand inventory, market inflation associated with tariff related cost increases and efforts to continue to diversify our supply chain. Selling, distribution and administrative expenses ("SD&A") primarily reflects the fixed cost nature of the business, including variable compensation expense, increased stock-based compensation expense and planned marketing investment. We expect SD&A expenses to be impacted by costs of integrating Indoff's operations into our overall internal controls over financial reporting and ongoing information technology ("IT") control remediation. We continue to maintain strong cost controls within discretionary spending, and will continue to evaluate additional steps to optimize our cost structure.
Previous report
Third Quarter 2025 Financial Summary:
Previous report
•Consolidated sales increased 3.3% to $353.6 million compared to $342.4 million last year.
Previous report
•Consolidated gross margin increased to 35.6% compared to 34.0% last year.
Previous report
Year to Date Q3 2025 Financial Summary:
Previous report
•Consolidated sales increased 2.0% to $1.03 billion compared to $1.01 billion last year.
Previous report
•Consolidated gross margin increased to 35.9% compared to 34.5% last year.
Previous report
•Consolidated operating income from continuing operations increased 18.2% to $78.0 million compared to $66.0 million last year.
Previous report
Three and Nine Months Ended September 30, 2025 compared to the Three and Nine Months Ended September 30, 2024
Previous report
*excludes discontinued operations
Previous report
The Company's net sales increased 3.3% to $353.6 million during the quarter ended September 30, 2025 compared to $342.4 million last year. For the nine months ended September 30, 2025, net sales increased 2.0% to $1.03 billion compared to $1.01 billion last year. Net sales reflect the continued impact of strong sales among our largest strategic accounts in the quarter, partially offset by a reduction in our smallest and transactional customer sales. U.S. sales increased 2.9% for the quarter compared to the same period in 2024 and Canada sales increased 10.8%, 12.3% in local currency. For the nine months ended September 30, 2025, U.S. sales increased 1.9% compared to the same period in 2024 and Canada sales increased 2.8%, 5.7% in local currency.
Previous report
Gross margin increased by 160 basis points to 35.6% in the third quarter of 2025 compared to 34.0% in the prior year and increased 140 basis points to 35.9% for the nine months ended September 30, 2025 compared to 34.5% in the prior year. Gross profit benefited from price capture, partially offset by diminishing favorability of pre-tariff inventory valuation flowing through cost of sales. In addition, overall freight management, including both outbound and inbound logistics contributed to the increased margin, as well as, quality initiatives that reduced freight claims and customer returns.
Previous report
SELLING, DISTRIBUTION AND ADMINISTRATIVE EXPENSES (“SD&A”)
Previous report
For the three month period ended September 30, 2025, SD&A as a percent of sales was 28.2%, up 70 basis points when compared to prior year of 27.5%. Strong general and discretionary cost control management and planned modest net advertising spend contributed to the result, offset by increased variable compensation expense related to performance. Cost increases in the quarter included total salary and related costs of approximately $5.0 million, of which approximately $3.5 million related to variable compensation with both selling commissions and bonus pool increasing compared to prior year and increased stock-based compensation expenses of approximately $1.6 million compared to prior year.
Previous report
For the nine months ended September 30, 2025, SD&A was 28.4% compared to prior year of 28.0%. Cost increases included total salary and related costs of approximately $12.2 million, of which approximately $6.4 million related to variable compensation with both selling commissions and bonus pool increasing compared to prior year and increased stock-based compensation expenses of approximately $4.9 million compared to prior year. These costs were partially offset by savings in net advertising spend of approximately $1.3 million and savings of approximately $2.6 million related to contract and consulting services.
Previous report
INTEREST AND OTHER EXPENSE, NET
Reworded paragraphs (25)
Previous wording
This report contains forward-looking statements within the meaning of that term in the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Additional written or oral forward-looking statements may be made by the Company from time to time in filings with the Securities and Exchange Commission or otherwise. Any such statements that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are based on management’s estimates, assumptions and projections and are not guarantees of future performance. Forward-looking statements may include, but are not limited to statements regarding: i) projections or estimates of revenue, income or loss, exit costs, cash flow needs and capital expenditures; ii) fluctuations in general economic conditions, including the effects of rising inflation and the volatility of inflation metrics; iii) future operations, such as risks regarding strategic business initiatives, plans relating to new distribution facilities, plans for utilizing alternative sources of supply in response to government tariff and trade actions and/or due to supply chain disruptions arising from pandemics, war, geopolitical conflicts and plans for new products or services; iv) plans for acquisition or sale of businesses, including expansion or restructuring plans; v) financing needs, and compliance with financial covenants in loan agreements; vi) assessments of materiality; vii) predictions of future events and the effects of pending and possible litigation; and viii) assumptions relating to the foregoing. In addition, when used in this report, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” and “plans” and variations thereof and similar expressions are intended to identify forward-looking statements.
Current wording
This report contains forward-looking statements within the meaning of that term in the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Additional written or oral forward-looking statements may be made by the Company from time to time in filings with the Securities and Exchange Commission or otherwise. Any such statements that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are based on management’s estimates, assumptions and projections and are not guarantees of future performance. Forward-looking statements may include, but are not limited to statements regarding: i) projections or estimates of revenue, income or loss, exit costs, cash flow needs and capital expenditures; ii) fluctuations in general economic conditions, including effects of rising inflation and volatility of inflation metrics; iii) future operations, such as risks regarding strategic business initiatives, plans relating to new distribution facilities, plans for utilizing alternative sources of supply in response to government tariff and trade actions and/or due to supply chain disruptions arising from pandemics, war, geopolitical conflicts and plans for new products or services; iv) plans for acquisition or sale of businesses, including expansion or restructuring plans; v) financing needs, and compliance with financial covenants in loan agreements; vi) assessments of materiality; vii) predictions of future events and the effects of pending and possible litigation; and viii) assumptions relating to the foregoing. In addition, when used in this report, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” and “plans” and variations thereof and similar expressions are intended to identify forward-looking statements.
Previous wording
•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 our 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 these tariffs and other trade barriers, as well as reciprocal trade measures, have caused us to both raise the prices on certain of our products to mitigate increased procurement costs 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;
Current wording
•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 wording
•increases in freight and shipping costs, including fuel costs, could affect our margins to the extent the increases cannot be passed along to customers, as has occurred in the past;
Current wording
•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 wording
•our ability to realize the expected benefits from acquisitions, including the Indoff acquisition, 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;
Current wording
•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 wording
There were no material changes in the Company’s significant accounting policies during the third quarter ended September 30, 2025.
Current wording
There were no material changes in the Company’s significant accounting policies during the first quarter ended March 31, 2026.
Previous wording
Highlights from Q3 2025 and Year to Date Q3 2025 compared to Q3 2024 and Year to Date Q3 2024
Current wording
Highlights from Q1 2026 compared to Q1 2025
Previous wording
The discussion of our results of operations and financial conditions that follows will provide information that will assist in understanding our financial statements and information about how certain accounting principles and estimates affect the condensed consolidated financial statements included herein.
Current wording
The discussion of our results of operations and financial condition that follows will provide information that will assist in understanding our financial statements and information about how certain accounting principles and estimates affect the condensed consolidated financial statements included herein.
Previous wording
•Consolidated operating income from continuing operations increased 18.5% to $26.3 million compared to $22.2 million last year.
Current wording
•Consolidated operating income from continuing operations increased 13.2% to $20.6 million compared to $18.2 million last year.
Previous wording
•Net income per diluted share from continuing operations increased 9.1% to $0.48 compared to $0.44 last year.
Current wording
•Net income per diluted share from continuing operations increased 11.4% to $0.39 compared to $0.35 last year.
Previous wording
•Net income per diluted share from continuing operations increased 13.8% to $1.48 compared to $1.30 last year.
Current wording
•Net income per diluted share from discontinued operations increased to $0.03 from $0.00 last year.
Previous wording
There were 63 selling days in the U.S. in each of the third quarters of 2025 and 2024, respectively, and there were 191 selling days in the U.S. for the nine months ended September 30, 2025 and 2024, respectively. In Canada, there were 62 selling days in each of the third quarters of 2025 and 2024, respectively, and there were 188 selling days in Canada for the nine months ended September 30, 2025 and 2024, respectively.
Current wording
There were 65 selling days and 64 selling days in the U.S. in the first quarter of 2026 and 2025, respectively, and in Canada, there were 63 selling days in each of the first quarters of 2026 and 2025, respectively.
Previous wording
Operating margin for the three and nine months periods ended September 30, 2025 increased 90 basis points and 100 basis points, respectively, compared to the same period in 2024 due to increased gross margin, continued strong general and discretionary cost control offset by increased variable compensation expense related to performance.
Current wording
Operating margin for the three month period ended March 31, 2026 increased 20 basis points compared to the same period in 2025 driven by the sales increase, modest decline in gross margin, continued strong general and discretionary cost control offset by increased variable compensation expense related to performance.
Previous wording
Interest and other expense, net from continuing operations was $0.2 million and $0.0 million expense for the three month periods ended September 30, 2025 and 2024, respectively, and $0.0 million and $0.3 million for the nine months ended September 30, 2025 and 2024, respectively. The fluctuations in the exchange rates contributed to the changes in the quarter and year to date.
Current wording
Interest and other (income) expense, net from continuing operations was $0.1 million income for the three months ended March 31, 2026 and $0.1 million expense for the three month periods ended March 31, 2025.
Previous wording
For the three month period ended September 30, 2025 and 2024, the Company reported income taxes in continuing operations of approximately $7.3 million and $5.4 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, 2025 and 2024, the Company reported income tax expense in continuing operations of $20.6 million and $15.6 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states. The Company's increased tax expense in 2025 compared to 2024 is attributable to the higher taxable income in 2025 and a higher tax rate due to an increase in non-deductible executive compensation.
Current wording
For the three month period ended March 31, 2026 and March 31, 2025, the Company reported income taxes in continuing operations of approximately $5.4 million and $4.6 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states.
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 new 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 these 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 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 principally upon operating cash flow. We currently believe that current cash on hand and cash flow from operations 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 $35.3 million primarily related to increased accounts receivable balances resulting from increased sales, higher cash balances and increased inventory balances. These increases were partially offset by increased accounts payable balances and accrued expenses and other current liabilities balances. Accounts receivable days outstanding were 39.3 in 2025 compared to 37.5 in 2024, inventory turns were 5.0 in 2025 compared to 5.4 in 2024 and accounts payable days outstanding were 47.5 in 2025 compared to 48.2 in 2024. 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 $7.7 million primarily related to increased accounts receivable, accounts payable and inventory balances offset by increased accrued expenses and other current liabilities balances and reduced cash and cash equivalents, and prepaid expenses and other current assets balances. Accounts receivable days outstanding were 38.6 in 2026 compared to 38.4 in 2025, inventory turns were 5.2 in 2026 compared to 5.0 in 2025 and accounts payable days outstanding were 44.0 in 2026 compared to 48.9 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 $57.7 million in 2025 compared to $34.6 million provided in 2024, attributable to cash generated from net income adjusted by other non-cash items which provided $69.8 million in 2025 compared to $58.8 million provided by these items in 2024 primarily due to higher net income in 2025 and higher stock-based compensation expense. Changes in our working capital accounts in 2025 used $12.1 million in cash compared to $24.2 million used in 2024, primarily the result of the changes in accounts receivable, inventory, income taxes, accounts payable, accrued expenses, other current liabilities and other liabilities balances. Net cash provided by operating activities from discontinued operations was $0.1 million and $0.2 million for the nine months ended September 30, 2025 and 2024, respectively.
Current wording
Net cash provided by operating activities from continuing operations was $4.7 million in 2026 compared to $3.3 million provided in 2025, attributable to cash generated from net income adjusted by other non-cash items of $19.2 million compared to $17.9 million generated in 2025 primarily due to higher net income and reduced stock-based compensation expenses in 2026 compared to prior year. Changes in working capital accounts used $14.5 million in 2026 compared to $14.6 million used in 2025, primarily the result of the changes in inventory, accounts receivable, and income taxes balances offset by changes in accounts payable balances. Net cash provided by operating activities from discontinued operations was $1.7 million and $0.1 million for the three months ended March 31, 2026 and March 31, 2025, respectively.
Previous wording
Net cash used in investing activities in 2025 totaled $6.3 million, with $4.0 million used for the equipment service provider acquisition and $2.3 million used for warehouse machinery and equipment for distribution facilities, computer equipment upgrades and molds. Net cash used in investing activities totaled $3.1 million in 2024 was used for warehouse machinery and equipment for distribution facilities, leasehold improvements, and computer equipment upgrades.
Current wording
Net cash used in investing activities in 2026 totaled $0.8 million primarily used for warehouse machinery and equipment for distribution facilities, motor vehicles, leasehold improvements and and molds. Net cash used in investing activities totaled $0.2 million in 2025 was used for warehouse machinery and equipment for distribution facilities, computer equipment upgrades and molds.
Previous wording
Net cash used in financing activities totaled $28.7 million in 2025 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 $1.5 million from the issuance of common stock from our employee stock purchase plan and proceeds of $2.2 million from the issuance of common stock, offset by $2.2 million of payments for payroll taxes through shares withheld. In 2024, net cash used in financing activities totaled $27.1 million primarily related to the regular quarterly dividends of $0.25 per common share which totaled approximately $28.8 million. Proceeds from the issuance of common stock totaled $1.8 million, offset by payments for payroll taxes through shares withheld, which totaled $1.6 million and proceeds from the issuance of common stock from our employee stock purchase plan totaled $1.5 million.
Current wording
Net cash used in financing activities totaled $11.3 million in 2026 primarily related to the regular quarterly dividends of $0.28 per common share which totaled approximately $10.8 million. 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 addition, $0.9 million was used for the purchase of treasury stock. In 2025, net cash used in financing activities totaled $8.8 million primarily related to the regular quarterly dividends of $0.26 per common share which totaled approximately $10.1 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 $0.7 million, and proceeds of $0.8 million from the issuance of common stock from our employee stock purchase plan.
Previous wording
The Company maintains a $125.0 million secured revolving credit facility with one financial institution, which has a five year term, maturing on October 19, 2026 and provides for borrowings in the United States. The credit agreement contains certain operating, financial and other covenants, including limits on annual levels of capital expenditures, availability tests related to payments of dividends and stock repurchases and fixed charge coverage tests related to acquisitions. The revolving credit agreement requires that a minimum level of availability be maintained. If such availability is not maintained, the Company will be required to maintain a fixed charge coverage ratio (as defined). The borrowings under the agreement are subject to borrowing base limitations of up to 85% of eligible accounts receivable and the inventory advance rate computed as the lesser of 65% or 85% of the net orderly liquidation value (“NOLV”). Borrowings are secured by substantially all of the Borrower’s assets, as defined, including all accounts, accounts receivable, inventory and certain other assets, subject to limited exceptions, including the exclusion of certain foreign assets from the collateral. The interest rate under the amended and restated facility is computed at applicable market rates based on the Secured Overnight Financing Rate (“SOFR”), the Federal Reserve Bank of New York (“NYFRB”) or the Prime Rate, plus an applicable margin. The applicable margin varies based on borrowing base availability. As of September 30, 2025, eligible collateral under the credit agreement was $125.0 million, total availability was approximately $122.1 million, total outstanding letters of credit was $1.6 million, and total excess availability was $120.5 million. The Company was in compliance with all of the covenants of the credit agreement as of September 30, 2025.
Current wording
The Company maintains a $125.0 million secured revolving credit facility with one financial institution, which has a five year term, maturing on October 19, 2026 and provides for borrowings in the United States. The credit agreement contains certain operating, financial and other covenants, including limits on annual levels of capital expenditures, availability tests related to payments of dividends and stock repurchases and fixed charge coverage tests related to acquisitions. The revolving credit agreement requires that a minimum level of availability be maintained. If such availability is not maintained, the Company will be required to maintain a fixed charge coverage ratio (as defined). The borrowings under the agreement are subject to borrowing base limitations of up to 85% of eligible accounts receivable and the inventory advance rate computed as the lesser of 65% or 85% of the net orderly liquidation value (“NOLV”). Borrowings are secured by substantially all of the Borrower’s assets, as defined, including all accounts, accounts receivable, inventory and certain other assets, subject to limited exceptions, including the exclusion of certain foreign assets from the collateral. The interest rate under the amended and restated facility is computed at applicable market rates based on the Secured Overnight Financing Rate (“SOFR”), the Federal Reserve Bank of New York (“NYFRB”) or the Prime Rate, plus an applicable margin. The applicable margin varies based on borrowing base availability. As of March 31, 2026, eligible collateral under the credit agreement was $125.0 million, total availability was approximately $121.5 million, total outstanding letters of credit was $1.6 million, and total excess availability was $119.9 million. The Company was in compliance with all of the covenants of the credit agreement as of March 31, 2026.
Previous wording
Levels of earnings and cash flows are dependent on factors such as consolidated gross margin and selling, distribution and administrative costs, product mix and relative levels of domestic and foreign sales. Unusual gains or expense items, such as special (gains) charges and settlements, may impact earnings and are separately disclosed. We expect that past performance may not be indicative of future performance due to the competitive nature of our business where the need to adjust prices to gain or hold market share is prevalent.
Current wording
Levels of earnings and cash flows are dependent on factors such as consolidated gross margin and selling, general and administrative costs, product mix and relative levels of domestic and foreign sales. Unusual gains or expense items, such as special (gains) charges and settlements, may impact earnings and are separately disclosed. We expect that past performance may not be indicative of future performance due to the competitive nature of our business where the need to adjust prices to gain or hold market share is prevalent.
Previous wording
The expenses and capital expenditures described above will require significant levels of liquidity, which we believe can be adequately funded from our currently available cash resources, cash flow from operations and borrowing under our current credit facility. In 2025 we anticipate capital expenditures of approximately $3.0 million, though at this time we are not contractually committed to incur these expenditures.
Current wording
The expenses and capital expenditures described above will require significant levels of liquidity, which we believe can be adequately funded from our currently available cash resources and cash flow from operations. In 2026 we anticipate capital expenditures in the range of $3.0 to $4.0 million, though at this time we are not contractually committed to incur these expenditures.
Previous wording
In the past we have engaged in opportunistic acquisitions, choosing to pay the purchase price in cash, and may do so in the future as favorable situations arise. However, a deep and prolonged period of reduced business spending could adversely impact our cash resources and force us to either forego future acquisition opportunities or to pay the purchase price using stock, debt or a combination of consideration which could have an adverse effect on our earnings. We believe that our cash balances and future cash flows from operations and availability under our credit facility will be sufficient to fund our working capital and other cash requirements for at least the next twelve months.
Current wording
In the past we have engaged in opportunistic acquisitions, choosing to pay the purchase price in cash, and may do so in the future as favorable situations arise. However, a deep and prolonged period of reduced business spending could adversely impact our cash resources and force us to either forego future acquisition opportunities or to pay the purchase price using stock, debt or a combination of consideration which could have an adverse effect on our earnings. We believe that our cash balances and future cash flows from operations will be sufficient to fund our working capital and other cash requirements for at least the next twelve months.
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 September 30, 2025, 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, 2025 cash balances held in foreign subsidiaries totaled approximately $4.9 million. These balances are held in local country banks and are held primarily to support local working capital needs. The Company had over $180 million of liquidity (cash and undrawn line of credit) in the U.S. as of September 30, 2025.
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 March 31, 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 March 31, 2026 cash balances held in foreign subsidiaries totaled approximately $5.0 million. These balances are held in local country banks and are held primarily to support local working capital needs. The Company had over $176 million of liquidity (cash and undrawn line of credit) in the U.S. as of March 31, 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 expires at various dates through 2034. As of September 30, 2025 we were obligated for approximately $139.2 million under these non-cancelable leases. In 2025 we anticipate remaining cash expenditures of approximately $4.2 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 March 31, 2026 we were obligated for approximately $117.9 million under these non-cancelable leases. In 2026 we anticipate remaining cash expenditures of approximately $16.1 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.