ALBANY INTERNATIONAL CORP /DE/
For the period ended Sep 30, 2026. Filed Oct 29, 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 Oct 29, 2026
AIN$67.28+0.4%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.
0001628280-26-052329
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsForward-looking statementsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-10-29.
0001628280-26-068150
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsForward-looking statementsThe 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 112 previous paragraphs and 112 current paragraphs.
71 unchanged; 31 reworded; 9 added; 10 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 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 (9)
Current report
During the fourth quarter of 2025, we announced plans to commence a strategic review of the Amelia Earhart Drive facility in Salt Lake City. In the third quarter of 2026, we determined that we would no longer pursue the previously planned sale of the facility following the conclusion of the strategic review. This decision was made following new business wins, a renegotiated contract for the Boeing 787 program, and amended contract terms with Sikorsky, a Lockheed Martin Company, on the CH-53K program. We continue to engage closely with our customers in connection with the retained operations.
Current report
The increase in gross profit of $190.3 million for the three months ended September 30, 2026, as compared to the three months ended September 30, 2025, was primarily driven by negative CH-53K program adjustments of $147.3 million recorded in the prior year period compared to the reversal of $44.4 million of these adjustments in the current year period due to the contract renegotiation. Additionally, higher AEC sales volume contributed to the increase in gross profit. These increases were partially offset by $11.0 million of catch-up depreciation and amortization recorded in the current year period upon reclassification of the Amelia Earhart Drive assets out of held for sale. Gross profit margin increased to 40.2% from (19.1)% for the three months ended September 30, 2026 and September 30, 2025, respectively.
Current report
The increase in gross profit of $204.0 million for the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, was primarily driven by changes in the estimated profitability of our CH-53K and other long-term contracts recognized in both periods. These adjustments were a negative $157.6 million in the prior year period, primarily related to an estimated loss reserve on CH-53K, compared to a positive $36.3 million in the current year period, primarily related to the CH-53K contract renegotiation. Additionally, higher AEC sales volume contributed to the increase in gross profit. Gross profit margin increased to 35.1% from 16.7% for the nine months ended September 30, 2026 and September 30, 2025, respectively.
Current report
Consolidated Technical and research expenses increased by $1.0 million as compared to the nine months ended September 30, 2025, driven by increased costs to assist with continued innovation primarily within the AEC segment.
Current report
Net revenues for the three months ended September 30, 2026 increased $93.3 million, or 107.8%, primarily driven by negative CH-53K program adjustments of $46.0 million recorded in the prior year period compared to the reversal of $11.6 million of those adjustments in the current year period due to a contract renegotiation resulting in additional transaction price, as well as higher other program activity levels, primarily LEAP.
Current report
Gross profit for the three months ended September 30, 2026 increased $197.0 million as compared to the three months ended September 30, 2025, and Gross profit margin increased from (152.6)% to 36.2% in the three months ended September 30, 2025 and 2026, respectively. The change was primarily driven by the absence of negative CH-53K program adjustments of $147.3 million recorded in the prior year period compared to the reversal of $44.4 million of these adjustments in the current year period due to the contract renegotiation. Additionally, higher sales volume contributed to the increase in gross profit. These increases were partially offset by $11.0 million of catch-up depreciation and amortization recorded in the current year period upon reclassification of the Amelia Earhart Drive assets out of held for sale.
Current report
Gross profit for the nine months ended September 30, 2026 increased $218.4 million as compared to the nine months ended September 30, 2025, and Gross profit margin increased from (30.7)% to 24.5% in the nine months ended September 30, 2025 and 2026, respectively. The change is primarily driven by changes in the estimated profitability of our CH-53K and other long-term contracts recognized in both periods. These adjustments were a negative $157.6 million in the prior year period, primarily related to an estimated loss reserve on CH-53K, compared to a positive $36.3 million in the current year period, primarily related to the CH-53K contract renegotiation. Additionally, higher sales volume contributed to the increase in gross profit.
Removed paragraphs (10)
Previous report
•Assets classified as held for sale may be sold for proceeds lower than currently estimated, or not sold within expected terms or timing;
Previous report
During the fourth quarter of 2025, we announced plans to commence a strategic review of the Amelia Earhart Drive facility in Salt Lake City. This review is progressing according to our planned timeline, and we have received multiple indications of interest with regards to a sale of the facility. We continue to engage closely with our customers throughout the strategic assessment process. This review is expected to be completed by the end of 2026. As of December 31, 2025, we determined that the assets and liabilities of this group meet the held-for-sale criteria, and they have been classified as such within our consolidated balance sheets for all periods presented. Upon classification as held for sale, the Company ceased depreciation and amortization of the related long-lived assets in accordance with applicable accounting guidance.
Previous report
The increase in gross profit of $10.4 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, was primarily driven by the increased sales volume. Gross profit margin increased slightly to 32.7% from 31.3% for the three months ended June 30, 2026 and June 30, 2025, respectively.
Previous report
The increase in gross profit of $13.7 million for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, was driven by the increased sales volume. Gross profit margin held stable at 32.4% and 32.3% for the six months ended June 30, 2026 and June 30, 2025, respectively.
Previous report
Consolidated Technical and research expenses decreased by $0.8 million as compared to the three months ended June 30, 2025, primarily due to lower intellectual property-related defense costs in the current year.
Previous report
Net revenues for the three months ended June 30, 2026 increased 15.6%, primarily driven by higher activity levels on various programs including LEAP platforms, B787 Frames, and Boeing Tanks, as well as lower unfavorable long-term contract adjustments. Further, changes in currency translation rates had the effect of increasing Net revenues by $1.8 million for the three months ended June 30, 2026, as compared to this period in 2025.
Previous report
Gross profit for the three months months ended June 30, 2026 increased $13.2 million as compared to the three months ended June 30, 2025, and Gross profit margin increased from 10.5% to 17.9% in the three months ended June 30, 2025 and 2026, respectively. The change was driven primarily by increases in revenue and lower depreciation related to held for sale accounting, as well as performance improvements on various programs, resulting in lower unfavorable long-term contract adjustments.
Previous report
Gross profit for the six months ended June 30, 2026 increased $21.4 million as compared to the six months ended June 30, 2025, and Gross profit margin increased from 12.4% to 17.5% in the six months ended June 30, 2025 and 2026, respectively. The change was driven primarily by increases in revenue and lower depreciation related to held for sale accounting, as well as performance improvements on various programs, resulting in lower unfavorable long-term contract adjustments.
Reworded paragraphs (31)
Previous wording
•Adverse impacts from inflation, an economic slowdown or recession and by disruption in capital and credit markets that might impede our access to credit, increase our borrowing costs and impair the financial soundness of our customers and suppliers;
Current wording
•Adverse impacts from inflation, an economic slowdown or recession and from disruption in capital and credit markets that might impede our access to credit, increase our borrowing costs and impair the financial soundness of our customers and suppliers;
Previous wording
Global, economic, and political conditions, changes in raw material and commodity prices and supply, labor availability and costs, inflation, interest rates, potential changes in U.S. government policy positions, including changes in Department of Defense policies or priorities, geopolitical conflicts and strained international relations, U.S. and non-U.S. tax law changes, foreign currency exchange rates, sanctions, tariffs, energy costs and supply, and the impact from natural disasters and weather conditions create uncertainties that could impact our businesses.
Current wording
Department of Defense policies or priorities, geopolitical conflicts and strained international relations, U.S. and non-U.S. tax law changes, foreign currency exchange rates, sanctions, tariffs, energy costs and supply, and the impact from natural disasters and weather conditions create uncertainties that could impact our businesses.
Previous wording
We believe the MC segment is well-positioned in key markets, with high-quality, low-cost production in growth markets, substantially lower fixed costs in mature markets, and continued strength in new product development, technical product support, and manufacturing technology. Some of the markets in which MC's products are sold are expected to have volume trends that are in line with global GDP. Despite pricing and demand pressures on revenue growth, the MC segment is expected to improve earnings in the future through technological innovations, manufacturing productivity efficiencies, global footprint optimization, and cost controls.
Current wording
We believe the MC segment is well-positioned in key markets, with high-quality, low-cost production, substantially lower fixed costs in mature markets, and continued strength in new product development, technical product support, and manufacturing technology. Some of the markets in which MC's products are sold are expected to have volume trends that are in line with global GDP. Despite pricing and demand pressures on revenue growth, the MC segment is expected to improve earnings in the future through technological innovations, manufacturing productivity efficiencies, global footprint optimization, and cost controls.
Previous wording
The AEC segment's strategy is to continue to build on its global brand by leveraging its industry leading performance to drive future growth through technology differentiation. This includes continued investment in AEC's proprietary 3D-woven technology to accelerate solutions that can be offered across a set of broader applications, and by leveraging the AEC's non-3D technology capabilities and capacity, on high-value aerospace (both commercial and defense) applications, and other emerging markets such as space and advanced air mobility ("AAM"). The AEC segment provides longer-term growth potential for the Company as it ramps current production programs and captures new commercial and defense opportunities.
Current wording
The AEC segment's strategy is to continue to build on its global brand by leveraging its industry leading performance to drive future growth through technology differentiation. This includes continued investment in AEC's proprietary 3D-woven technology to accelerate solutions that can be offered across a set of broader applications, and by leveraging AEC's non-3D technology capabilities and capacity, on high-value aerospace (both commercial and defense) applications, and other emerging markets such as space and advanced air mobility ("AAM"). The AEC segment provides longer-term growth potential for the Company as it ramps current production programs and captures new commercial and defense opportunities.
Previous wording
Net revenues for the six months ended June 30, 2026 increased $40.6 million or 6.8% as compared to the six months ended June 30, 2025 primarily due to higher activity levels in the AEC segment partially offset by softness in the MC business as a result of reduced activity levels in the Americas region and temporary production interruptions in the business. Additionally, changes in currency translation rates increased comparative segment net revenues by $13.2 million as compared to the prior year.
Current wording
Net revenues for the three months ended September 30, 2026 increased $88.1 million or 33.7% as compared to the three months ended September 30, 2025, primarily driven by negative CH-53K program adjustments of $46.0 million recorded in the prior year period compared to the reversal of $11.6 million of those adjustments in the current year period due to a contract renegotiation resulting in additional transaction price, as well as higher other program activity levels in the AEC segment. This is partially offset by softness in the MC business as a result of reduced activity levels in the Americas region.
Previous wording
Net revenues for the three months ended June 30, 2026 increased $18.1 million or 5.8% as compared to the three months ended June 30, 2025 primarily due to higher activity levels in the AEC segment partially offset by softness in the MC business as a result of reduced activity levels in the Americas region and temporary production interruptions in the business. Additionally, changes in currency translation rates increased comparative segment net revenues by $4.0 million as compared to the prior year.
Current wording
Net revenues for the nine months ended September 30, 2026 increased $128.7 million or 14.9% as compared to the nine months ended September 30, 2025, primarily driven by negative CH-53K program adjustments of $54.3 million recorded in the prior year period compared to positive adjustments of $11.6 million in the current year period due to a contract renegotiation resulting in additional transaction price, as well as higher other program activity levels in the AEC segment. This is partially offset by softness in the MC business as a result of reduced activity levels in the Americas region. Additionally, changes in currency translation rates increased comparative segment net revenues by $14.0 million as compared to the prior year.
Previous wording
Consolidated Selling, general and administrative ("SG&A") expenses increased $2.1 million or 1.8% as compared to the six months ended June 30, 2025. The overall changes are primarily the result of costs incurred related to the strategic review of the Amelia Earhart Drive facility.
Current wording
Consolidated Selling, general and administrative ("SG&A") expenses increased $9.6 million or 18.5% as compared to the three months ended September 30, 2025. The overall changes are primarily the result of costs incurred related to the strategic review of the Amelia Earhart Drive facility and an increase in compensation costs.
Previous wording
Consolidated Technical and research expenses increased by $0.2 million as compared to the six months ended June 30, 2025, primarily due to costs associated with new business venture initiatives.
Current wording
Consolidated Technical and research expenses increased by $0.7 million as compared to the three months ended September 30, 2025, driven by increased costs to assist with continued innovation primarily within the AEC segment.
Previous wording
Restructuring expenses, net of $8.0 million in the three months ended June 30, 2026, increased by $3.8 million compared to $4.2 million in the three months ended June 30, 2025. The increase in restructuring expenses for the three month period is primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Current wording
Restructuring expenses, net of $7.3 million in the three months ended September 30, 2026, increased by $4.1 million compared to $3.2 million in the three months ended September 30, 2025. The increase in restructuring expenses for the three month period is primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Previous wording
Consolidated Selling, general and administrative ("SG&A") expenses decreased $2.4 million or 4.2% as compared to the three months ended June 30, 2025. The overall changes are primarily the result of cost control actions and favorable foreign currency impacts particularly in the MC business.
Current wording
Consolidated Selling, general and administrative ("SG&A") expenses increased $11.6 million or 7.1% as compared to the nine months ended September 30, 2025. The overall changes are primarily the result of costs incurred related to the strategic review of the Amelia Earhart Drive facility and an increase in compensation costs.
Previous wording
Restructuring expenses, net of $11.1 million in the six months ended June 30, 2026, increased by $4.4 million compared to $6.7 million in the six months ended June 30, 2025. The increase in restructuring expenses for the six month period is primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Current wording
Restructuring expenses, net of $18.4 million in the nine months ended September 30, 2026, increased by $8.5 million compared to $9.9 million in the nine months ended September 30, 2025. The increase in restructuring expenses for the nine month period is primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Previous wording
Interest expense, net, increased over the prior year primarily due to higher average debt balances as well as a lower amount of interest income earned on cash equivalents during the current year.
Current wording
Interest expense, net, increased $2.2 million as compared to the nine months ended September 30, 2025 due to higher average debt balances as well as a lower amount of interest income earned on cash equivalents during the current year.
Previous wording
Other (income)/expense, net, included foreign currency related activity which resulted in gains of $0.5 million and $2.7 million in the three and six months ended June 30, 2026, as compared to losses of $5.7 million and $8.8 million in the same periods last year. These changes were primarily the result of unrealized gains and losses on intercompany loans. In addition, changes in the fair value of derivative instruments included gains of $0.2 million and $1.5 million in the three and six months ended June 30, 2026, as compared to gains of $0.7 million and $3.3 million for the three and six months ended June 30, 2025. Unrealized gains and losses on both derivative instruments and intercompany loans were driven by currency rate movements, most notably the Brazilian Real and Mexican Peso. Components of net periodic pension and postretirement costs other than service costs constituted expenses of $1.5 million and $3.0 million in the three and six months ended June 30, 2026, as compared to income of $0.5 million for the three months ended June 30, 2025 and expenses of $0.3 million for the six months ended June 30, 2025. See Note 6, Other (Income)/Expense, net, in the Notes to the Consolidated Financial Statements in Item 1, which is incorporated herein by reference.
Current wording
Other (income)/expense, net, included foreign currency related activity which resulted in gains of $2.1 million and $4.8 million in the three and nine months ended September 30, 2026, as compared to gains of $1.1 million and losses of $7.8 million in the same periods last year. These changes were primarily the result of unrealized gains and losses on intercompany loans. In addition, changes in the fair value of derivative instruments included gains of $0.1 million and $1.6 million in the three and nine months ended September 30, 2026, as compared to gains of $0.1 million and $3.4 million for the three and nine months ended September 30, 2025. Unrealized gains and losses on both derivative instruments and intercompany loans were driven by currency rate movements, most notably the Brazilian Real and British Pound Sterling. Components of net periodic pension and postretirement costs other than service costs constituted expenses of $1.5 million and $4.4 million in the three and nine months ended September 30, 2026, as compared to expenses of $1.0 million for the three months ended September 30, 2025 and $1.3 million for the nine months ended September 30, 2025. See Note 6, Other (Income)/Expense, net, in the Notes to the Consolidated Financial Statements in Item 1, which is incorporated herein by reference.
Previous wording
The tax rate is affected by recurring items, such as the income tax rate in the U.S. and non-U.S. jurisdictions and the mix of pre-tax income earned in those jurisdictions. The tax rate is also affected by U.S. tax costs on foreign pre-tax earnings, and by discrete items that may occur in any given year but are not consistent from year to year. The Company’s effective tax rate for the six months ended June 30, 2026 was 32.5%, compared to 28.3% for the same period in 2025, mainly due to unfavorable discrete tax adjustments recognized in the current period, partially offset by favorable discrete tax adjustments, compared to favorable discrete tax adjustments recognized in the prior period. For more information, see Note 7, Income Taxes, in the Notes to the Consolidated Financial Statements in Item 1, which is incorporated herein by reference.
Current wording
The tax rate is affected by recurring items, such as the income tax rate in the U.S. and non-U.S. jurisdictions and the mix of pre-tax income earned in those jurisdictions. The tax rate is also affected by U.S. tax costs on foreign pre-tax earnings, and by discrete items that may occur in any given year but are not consistent from year to year. The Company’s effective tax rate for the nine months ended September 30, 2026 was 28.5%, compared to 16.4% for the same period in 2025, primarily due to the Company being in a loss position in prior year. For more information, see Note 7, Income Taxes, in the Notes to the Consolidated Financial Statements in Item 1, which is incorporated herein by reference.
Previous wording
Net revenues for the six months ended June 30, 2026 decreased 3.1% as compared to the six months ended June 30, 2025, driven by reduced demand in the Americas region and temporary production interruptions partially offset by strong performance within the European market and stable performance in Asia. Further, changes in currency translation rates had the effect of increasing Net revenues by $8.3 million for the six months ended June 30, 2026, as compared to this period in 2025.
Current wording
Net revenues for the three months ended September 30, 2026 decreased 2.9% as compared to the three months ended September 30, 2025, driven by reduced demand in the Americas region partially offset by strong performance within the European market and stable performance in Asia.
Previous wording
Net revenues for the three months ended June 30, 2026 decreased 1.2% as compared to the three months ended June 30, 2025, driven by reduced demand in the Americas region partially offset by strong performance within the European market and stable performance in Asia. Further, changes in currency translation rates had the effect of increasing Net revenues by $2.1 million for the three months ended June 30, 2026, as compared to this period in 2025.
Current wording
Net revenues for the nine months ended September 30, 2026 decreased 3.0% as compared to the nine months ended September 30, 2025, driven by reduced demand in the Americas region offset by strong performance within the European market and stable performance in Asia. Further, changes in currency translation rates had the effect of increasing Net revenues by $8.4 million for the nine months ended September 30, 2026, as compared to this period in 2025.
Previous wording
Gross profit for the three months ended June 30, 2026 decreased by $2.8 million as compared to the three months ended June 30, 2025, primarily driven by the volume declines noted above, with gross profit margin also decreasing slightly from 46.3% to 45.3% in the three months ended June 30, 2025 and 2026, respectively.
Current wording
Gross profit for the three months ended September 30, 2026 decreased by $6.7 million as compared to the three months ended September 30, 2025, driven by the volume declines noted above as well as under absorbed costs related to lower production rates, with gross profit margin decreasing from 46.9% to 44.4% in the three months ended September 30, 2025 and 2026, respectively.
Previous wording
Gross profit for the six months ended June 30, 2026 decreased by $7.7 million as compared to the six months ended June 30, 2025, primarily driven by the volume declines noted above, with gross profit margin also decreasing slightly from 46.0% to 45.3% in the six months ended June 30, 2025 and 2026, respectively.
Current wording
Gross profit for the nine months ended September 30, 2026 decreased by $14.4 million as compared to the nine months ended September 30, 2025, primarily driven by the volume declines noted above as well as under absorbed costs related to lower production rates, with gross profit margin decreasing slightly from 46.3% to 45.0% in the nine months ended September 30, 2025 and 2026, respectively.
Previous wording
Operating income for the six months ended June 30, 2026 decreased $9.5 million or 12.4% as compared to the six months ended June 30, 2025, primarily as a result of gross profit declines and restructuring costs. Incremental restructuring expenses were primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Current wording
Operating income for the three months ended September 30, 2026 decreased $11.9 million or 27.7% as compared to the three months ended September 30, 2025, primarily as a result of gross profit declines and higher restructuring costs. Incremental restructuring expenses were primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Previous wording
Operating income for the three months ended June 30, 2026 decreased $3.0 million or 7.9% as compared to the three months ended June 30, 2025, primarily as a result of gross profit declines and higher restructuring costs, offset by SG&A cost containment. Incremental restructuring expenses were primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Current wording
Operating income for the nine months ended September 30, 2026 decreased $21.4 million or 18.0% as compared to the nine months ended September 30, 2025, primarily as a result of gross profit declines and higher restructuring costs, partially offset by Selling, general, and administrative and Technical and research cost containment. Incremental restructuring expenses were primarily a result of higher asset transfer costs related to site consolidations and higher consulting costs.
Previous wording
AEC has contracts with certain customers, including its contract for the LEAP program, where revenue is determined by a cost-plus-fee agreement. Revenue earned under this arrangement accounted for approximately 34% and 34% of segment revenue for the six months ended June 30, 2026 and 2025, respectively.
Current wording
AEC has contracts with certain customers, including its contract for the LEAP program, where revenue is determined by a cost-plus-fee agreement. Revenue earned under this arrangement accounted for approximately 33% and 37% of segment revenue for the nine months ended September 30, 2026 and 2025, respectively.
Previous wording
Net revenues for the six months ended June 30, 2026 increased 21.1%, primarily driven by higher activity levels on various programs including LEAP platforms, B787 Frames, F-35, and BETA Technologies, as well as lower unfavorable long-term contract adjustments. Further, changes in currency translation rates had the effect of increasing Net revenues by $5.0 million for the six months ended June 30, 2026, as compared to this period in 2025.
Current wording
Net revenues for the nine months ended September 30, 2026 increased $144.9 million, or 43.8%, primarily driven by negative CH-53K program adjustments of $54.3 million recorded in the prior year period compared to positive adjustments of $11.6 million in the current year period due to a contract renegotiation resulting in additional transaction price. Additionally, other program activities are higher in the current year period including LEAP platforms, B787 Frames, F-35, and BETA Technologies. Further, changes in currency translation rates had the effect of increasing Net revenues by $5.7 million for the nine months ended September 30, 2026, as compared to this period in 2025.
Previous wording
Operating income for the three months ended June 30, 2026 increased $14.1 million as compared to the three months ended June 30, 2025, principally due to favorable changes to Gross profit as noted above and the conclusion of restructuring activities from 2025. Operating income was further increased by a slight decrease in SG&A expenses of $0.5 million from the prior period as a result of cost containment efforts.
Current wording
Operating income for the three months ended September 30, 2026 increased $191.4 million as compared to the three months ended September 30, 2025, principally due to favorable changes to Gross profit as noted above and the conclusion of restructuring activities from 2025. This is partially offset by an increase in SG&A expenses of $4.9 million from the prior period as a result of increased compensation expenses.
Previous wording
Operating income for the six months ended June 30, 2026 increased $21.1 million as compared to the six months ended June 30, 2025, principally due to favorable changes to Gross profit as noted above and the conclusion of restructuring activities from 2025. This was slightly offset by an increase in SG&A expenses of $1.0 million from the prior period. Additionally, Technical and research expenses increased $1.0 million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, driven by increased consulting costs to assist with continued innovation within the segment.
Current wording
Operating income for the nine months ended September 30, 2026 increased $212.4 million as compared to the nine months ended September 30, 2025, principally due to favorable changes to Gross profit as noted above and the conclusion of restructuring activities from 2025. This was slightly offset by an increase in SG&A expenses of $5.9 million from the prior period as a result of increased compensation expenses. Additionally, Technical and research expenses increased $1.8 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025, driven by increased costs to assist with continued innovation within the segment.
Previous wording
Net cash provided by operating activities during the six months ended June 30, 2026 was $3.0 million, compared to $34.8 million in the six months ended June 30, 2025. The decrease was driven by lower cash generated by working capital primarily related to inventory growth in connection with seasonal activity levels in MC and customer demand in AEC.
Current wording
Net cash provided by operating activities during the nine months ended September 30, 2026 was $51.6 million, compared to $78.8 million in the nine months ended September 30, 2025. The decrease was driven by lower cash generated by working capital primarily due to timing of customer collections and inventory growth in connection with timing of demand in both MC and AEC.
Previous wording
Net cash used in investing activities included capital expenditures totaling $21.2 million and $30.5 million for the six months ended June 30, 2026 and June 30, 2025, respectively, with continued growth capital and capital designed to improve operating efficiencies across the Company.
Current wording
Net cash used in investing activities included capital expenditures totaling $33.3 million and $48.8 million for the nine months ended September 30, 2026 and September 30, 2025, respectively, with continued growth capital and capital designed to improve operating efficiencies across the Company.
Previous wording
Net cash used in financing activities was $19.2 million for the six months ended June 30, 2026 as compared to net cash used of $24.5 million for the six months ended June 30, 2025. During 2026, we had net repayments of debt of $2.0 million as compared to $113.9 million of borrowings in the prior year, which were offset by share repurchases of $120.4 million. Additionally, the Company has returned cash to shareholders through dividends of $15.9 million in the first six months of 2026, a $0.8 million improvement in cash flow as compared to prior year.
Current wording
Net cash used in financing activities was $55.5 million for the nine months ended September 30, 2026 as compared to net cash used of $48.3 million for the nine months ended September 30, 2025. During 2026, we had net repayments of debt of $30.0 million as compared to $150.0 million of borrowings in the prior year, which were offset by share repurchases of $171.0 million. Additionally, the Company has returned cash to shareholders through dividends of $23.8 million in the first nine months of 2026, compared to $24.7 million for the nine months ended September 30, 2025.
Previous wording
We finance our business activities principally with cash generated from operations and borrowings, largely through our revolving credit agreement as discussed below. As of June 30, 2026, $450.7 million of borrowings were outstanding under our $800 million unsecured committed Amended Credit Agreement.
Current wording
We finance our business activities principally with cash generated from operations and borrowings, largely through our revolving credit agreement as discussed below. As of September 30, 2026, $422.1 million of borrowings were outstanding under our $800 million unsecured committed Amended Credit Agreement.
Previous wording
As of June 30, 2026, we had cash and cash equivalents of $77.3 million and borrowing capacity under our Amended Credit Agreement of $349.3 million, for a total liquidity of approximately $426.7 million. We believe cash flows from operations and the availability of funds under our Amended Credit Agreement will be adequate to fund our operations and business needs over the next twelve months.
Current wording
As of September 30, 2026, we had cash and cash equivalents of $79.1 million and borrowing capacity under our Amended Credit Agreement of $377.9 million, for a total liquidity of approximately $457.0 million. We believe cash flows from operations and the availability of funds under our Amended Credit Agreement will be adequate to fund our operations and business needs over the next twelve months.
Previous wording
As of June 30, 2026, $68.2 million of our total cash and cash equivalents were held by non-U.S. subsidiaries. The accumulated undistributed earnings of the Company’s foreign operations not targeted for repatriation to the U.S. were in excess of$156.1 million, as of June 30, 2026 and are intended to remain indefinitely invested in foreign operations. Our cash planning strategy includes repatriating current earnings in excess of working capital requirements from certain countries in which our subsidiaries operate. While we have been successful in such endeavor to date, there can be no assurance that we will be able to cost effectively repatriate funds in the future. Repatriating such cash from certain jurisdictions, which is currently considered to be indefinitely reinvested in foreign operations, may also result in additional taxes.
Current wording
As of September 30, 2026, $68.4 million of our total cash and cash equivalents were held by non-U.S. subsidiaries. The accumulated undistributed earnings of the Company’s foreign operations not targeted for repatriation to the U.S. were in excess of $161.5 million, as of September 30, 2026 and are intended to remain indefinitely invested in foreign operations. Our cash planning strategy includes repatriating current earnings in excess of working capital requirements from certain countries in which our subsidiaries operate. While we have been successful in such endeavor to date, there can be no assurance that we will be able to cost effectively repatriate funds in the future. Repatriating such cash from certain jurisdictions, which is currently considered to be indefinitely reinvested in foreign operations, may also result in additional taxes.
Previous wording
The Company is party to certain off-balance sheet arrangements, including certain guarantees. The Company provides financial assurance, such as payment guarantees and letters of credit and surety bonds, primarily to support workers’ compensation programs and customs clearance, of less than $10 million. There were no material changes in the Company’s off-balance sheet arrangements during the second quarter of 2026.
Current wording
The Company is party to certain off-balance sheet arrangements, including certain guarantees. The Company provides financial assurance, such as payment guarantees and letters of credit and surety bonds, primarily to support workers’ compensation programs and customs clearance, of less than $10 million. There were no material changes in the Company’s off-balance sheet arrangements during the third quarter of 2026.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Global, economic, and political conditions, changes in raw material and commodity prices and supply, labor availability and costs, inflation, interest rates, potential changes in U.S. government policy positions, including changes in