TREDEGAR CORP

Previous wording

•noncompliance with any of the financial and other restrictive covenants in the ABL Facility;

Current wording

•noncompliance with any of the financial and other restrictive covenants in the ABL Facility (defined below);

Previous wording

Tredegar Corporation is an industrial manufacturer with two primary businesses: custom aluminum extrusions for the building & construction (“B&C”), automotive and specialty end-use markets in the United States through its Aluminum Extrusions segment (with exports comprising less than 5% of total sales volume) and surface protection films for high-technology applications in the global electronics industry through its High Performance Films segment. With approximately 1,800 employees, the Company operates manufacturing facilities in the U.S. and China.

Current wording

Tredegar Corporation is an industrial manufacturer with two primary businesses: custom aluminum extrusions for the building & construction (“B&C”), automotive and specialty end-use markets in the United States through its Aluminum Extrusions segment (with exports comprising less than 5% of total sales volume) and surface protection films for high-technology applications in the global electronics industry through its High Performance Films segment. With approximately 1,700 employees, the Company operates manufacturing facilities in the U.S. and China.

Previous wording

Second quarter 2026 net income (loss) from continuing operations was $6.0 million ($0.17 per diluted share) compared to $1.8 million ($0.05 per diluted share) in the second quarter of 2025.

Current wording

Third quarter 2026 net income (loss) from continuing operations was $(2.8) million ($(0.08) per diluted share) compared to $7.1 million ($0.20 per diluted share) in the third quarter of 2025.

Previous wording

•EBITDA from ongoing operations for Aluminum Extrusions was $14.5 million in the second quarter of 2026 versus $9.3 million in the second quarter of 2025 and versus $11.7 million in the first quarter of 2026.

Current wording

•EBITDA from ongoing operations for Aluminum Extrusions was $2.5 million in the third quarter of 2026 versus $16.8 million in the third quarter of 2025 and versus $14.5 million in the second quarter of 2026.

Previous wording

•EBITDA from ongoing operations for High Performance Films was $5.8 million in the second quarter of 2026 versus $6.7 million in the second quarter of 2025 and versus $5.1 million in the first quarter of 2026.

Current wording

•EBITDA from ongoing operations for High Performance Films was $4.6 million in the third quarter of 2026 versus $7.2 million in the third quarter of 2025 and versus $5.8 million in the second quarter of 2026.

Previous wording

The following table presents a bridge of consolidated net income (loss) from continuing operations from the second quarter of 2025 to the second quarter of 2026 with management's related discussion and analysis below the table.

Current wording

The following table presents a bridge of consolidated net income (loss) from continuing operations from the third quarter of 2025 to the third quarter of 2026 with management's related discussion and analysis below the table.

Previous wording

Sales in the second quarter of 2026 increased by $37.1 million compared with the second quarter of 2025. Net sales (sales less freight) in Aluminum Extrusions increased $35.8 million, primarily due to the pass-through of higher metal costs, partially offset by lower volume. Net sales in High Performance Films increased $1.0 million, primarily due to an increase in sales volume in surface protection films, partially offset by unfavorable mix in surface protection films. For more information on net sales and volume, see the Segment Operations Review below.

Current wording

Sales in the third quarter of 2026 increased by $12.2 million compared with the third quarter of 2025. Net sales (sales less freight) in Aluminum Extrusions increased $14.8 million, primarily due to the pass-through of higher metal costs, partially offset by lower volume. Net sales in High Performance Films decreased $2.1 million, primarily due to a decrease in sales volume and unfavorable mix, partially offset by favorable pricing for surface protection films. For more information on net sales and volume, see the Segment Operations Review below.

Previous wording

Consolidated gross profit (sales minus cost of goods sold and freight) as a percentage of sales (gross profit margin) was 13.4% in the second quarter of 2026 compared to 13.6% in the second quarter of 2025. The gross profit margin in Aluminum Extrusions remained consistent with the prior period. The gross profit margin in High Performance Films decreased primarily due to a lower advanced packaging contribution margin associated with the pass-through lag associated with higher resin costs.

Current wording

Consolidated gross profit (sales minus cost of goods sold and freight) as a percentage of sales (gross profit margin) was 7.2% in the third quarter of 2026 compared to 16.0% in the third quarter of 2025. The gross profit margin in Aluminum Extrusions decreased primarily due to higher labor rates, unfavorable labor productivity, higher maintenance expense and higher freight expense, partially offset by favorable pricing and mix and favorable manufacturing costs primarily associated with casting capabilities due to scrap spreads and higher scrap utilization. The gross profit margin in High Performance Films decreased primarily due to a lower surface protection films contribution margin associated with unfavorable volume and mix and the pass-through lag associated with higher resin costs, partially offset by cost improvements.

Previous wording

As a percentage of sales, selling, general and administrative (“SG&A”) and research and development ("R&D") expenses were 9.4% in the second quarter of 2026 compared with 11.6% in the second quarter of 2025. Second quarter sales increased 20.7% while SG&A decreased 2.1% compared to the prior period. Lower SG&A spending was primarily due to lower professional fees associated with business development activities ($1.1 million) and lower stock-based compensation ($0.4 million), partially offset by higher employee compensation ($0.8 million).

Current wording

As a percentage of sales, selling, general and administrative (“SG&A”) and research and development ("R&D") expenses were 8.0% in the third quarter of 2026 compared with 10.5% in the third quarter of 2025. Third quarter sales increased 6.3% while SG&A decreased 19.5% compared to the prior period. Lower SG&A spending was primarily due to lower professional fees associated with business development activities ($1.2 million), lower stock-based compensation ($1.0 million) and lower employee compensation ($0.9 million).

Previous wording

Interest expense was $0.5 million in the second quarter of 2026 in comparison to $1.8 million in the second quarter of 2025. The decrease in interest expense was primarily due to the write-off of deferred financing fees related to Amendment No. 5 to the Company's Second Amended and Restated Credit Agreement of $0.8 million during the second quarter of 2025, lower weighted average total debt outstanding and lower interest rates.

Current wording

Interest expense was $0.5 million in the third quarter of 2026 in comparison to $0.8 million in the third quarter of 2025. The decrease in interest expense was primarily due to lower weighted average total debt outstanding and lower interest rates.

Previous wording

The effective tax rate from continuing operations in the second quarter of 2026 was 22.3% compared to 35.0% in the second quarter of 2025. The effective tax rate for the second quarter of 2026 was consistent with the U.S. statutory rate of 21% while the effective tax rate for the second quarter of 2025 varied from the statutory rate due to a mix of lower pre-tax income and higher nondeductible discrete items as a percentage of pre-tax income.

Current wording

The effective tax rate from continuing operations in the third quarter of 2026 was 19.0% compared to 22.1% in the third quarter of 2025. The effective tax rate for the third quarter of 2026 varied from the statutory rate of 21% due to research and development tax credits while the effective tax rate for the third quarter of 2025 was consistent with the statutory rate of 21%.

Previous wording

The following table presents a bridge of consolidated net income (loss) from continuing operations from the first six months of 2025 to the first six months of 2026 with management's related discussion and analysis below the table.

Current wording

The following table presents a bridge of consolidated net income (loss) from continuing operations from the first nine months of 2025 to the first nine months of 2026 with management's related discussion and analysis below the table.

Previous wording

Sales in the first six months of 2026 increased by $58.9 million compared with the first six months of 2025. Net sales (sales less freight) in Aluminum Extrusions increased $61.6 million, primarily due to the pass-through of higher metal costs, partially offset by lower volume. Net sales in High Performance Films decreased $3.0 million, primarily due to unfavorable mix in surface protection films. For more information on net sales and volume, see the Segment Operations Review below.

Current wording

Sales in the first nine months of 2026 increased by $71.1 million compared with the first nine months of 2025. Net sales (sales less freight) in Aluminum Extrusions increased $76.4 million, primarily due to the pass-through of higher metal costs, partially offset by lower volume. Net sales in High Performance Films decreased $5.1 million, primarily due to lower volume and unfavorable mix in surface protection films. For more information on net sales and volume, see the Segment Operations Review below.

Previous wording

Consolidated gross profit (sales minus cost of goods sold and freight) as a percentage of sales (gross profit margin) was 13.0% in the first six months of 2026 compared to 13.9% in the first six months of 2025. The gross profit margin in Aluminum Extrusions remained consistent with the prior period. The gross profit margin in High Performance Films decreased due to a lower Surface Protection contribution margin associated with lower volume, unfavorable mix, and the pass-through lag associated with higher resin costs, partially offset by favorable productivity and cost improvements.

Current wording

Consolidated gross profit (sales minus cost of goods sold and freight) as a percentage of sales (gross profit margin) was 11.0% in the first nine months of 2026 compared to 14.7% in the first nine months of 2025. The gross profit margin in Aluminum Extrusions decreased primarily due to higher labor rates, unfavorable labor productivity, and higher maintenance and supply expense, die expense, and freight, partially offset by favorable mix and favorable manufacturing costs primarily associated with casting capabilities due to scrap spreads and higher scrap utilization. The gross profit margin in High Performance Films decreased due to a lower Surface Protection contribution margin associated with lower volume, unfavorable pricing and mix, and the pass-through lag associated with higher resin costs, partially offset by favorable productivity and cost improvements.

Previous wording

As a percentage of sales, SG&A and R&D expenses were 9.2% in the first six months of 2026 compared with 12.1% in the first six months of 2025. Sales increased 17.1% while SG&A decreased 11.3% compared to the prior period. Lower SG&A spending was primarily due to lower professional fees associated with business development activities ($4.1 million) and lower stock-based compensation ($0.7 million).

Current wording

As a percentage of sales, SG&A and R&D expenses were 8.8% in the first nine months of 2026 compared with 11.5% in the first nine months of 2025. Sales increased 13.2% while SG&A decreased 14.0% compared to the prior period. Lower SG&A spending was primarily due to lower professional fees associated with business development activities ($5.9 million), lower stock-based compensation ($1.8 million) and lower employee compensation ($0.7 million).

Previous wording

Interest expense was $0.8 million in the first six months of 2026 in comparison to $2.8 million in the first six months of 2025. The decrease was primarily due to the write-off of deferred financing fees related to Amendment No. 5 to the Second Amended and Restated Credit Agreement of $0.8 million during the first six months of 2025, lower weighted average total debt outstanding and lower interest rates.

Current wording

Interest expense was $1.4 million in the first nine months of 2026 in comparison to $3.6 million in the first nine months of 2025. The decrease was primarily due to the write-off of deferred financing fees related to the amendment to our credit agreement (“ABL Facility”) of $0.8 million during the first nine months of 2025, lower weighted average total debt outstanding and lower interest rates during the first nine months of 2026.

Previous wording

The effective tax rate from continuing operations in the first six months of 2026 was 19.9% compared to 38.4% in the first six months of 2025. The effective tax rate for the first six months of 2026 varied from the statutory rate of 21% due to research and development tax credits while the effective tax rate for the first six months of 2025 varied from the statutory rate due to a mix of lower pre-tax income and higher nondeductible discrete items as a percentage of pre-tax income.

Current wording

The effective tax rate from continuing operations in the first nine months of 2026 was 20.2% compared to 27.1% in the first nine months of 2025. The effective tax rate for the first nine months of 2026 varied from the statutory rate of 21% due to research and development tax credits while the effective tax rate for the first nine months of 2025 varied from the statutory rate due to higher nondeductible discrete items as a percentage of pre-tax income.

Previous wording

The following table presents the sales volume by end use market for the three and six months ended June 30, 2026 and 2025, and the three months ended March 31, 2026.

Current wording

The following table presents the sales volume by end use market for the three and nine months ended September 30, 2026 and 2025, and the three months ended June 30, 2026.

Previous wording

Net sales in the second quarter of 2026 increased 24.1% versus the second quarter of 2025 primarily due to the pass-through of higher metal costs, partially offset by lower volume. Sales volume in the second quarter of 2026 decreased 5.8% versus the second quarter of 2025 and increased 8.8% versus the first quarter of 2026. Bonnell Aluminum experienced a 16% decline in nonresidential building and construction volume, driven by higher costs, including significantly higher metal costs, and ongoing economic uncertainty. Nonresidential building and construction volume represented approximately 48% of total volume and remains Bonnell Aluminum’s most significant end-use market. Within the specialty market, consumer durables volume, representing 8% of total volume, decreased 18% due to consumer cautionary spending on discretionary purchases. Also within the specialty market, TSLOTSTM shipments, representing approximately 11% of total volume, increased 45%, supported by increased demand for data‑containment and data‑center infrastructure. Automotive and transportation volume declined 16%, reflecting continued cost pressures on manufacturers and lower sales compared with the prior year period, which benefited from tariff-related pull-forward demand in the second quarter of 2025. Automotive and transportation represents approximately 7% of total volume.

Current wording

Net sales in the third quarter of 2026 increased 9.1% versus the third quarter of 2025 primarily due to the pass-through of higher metal costs, partially offset by lower volume. Sales volume in the third quarter of 2026 decreased 11.6% versus the third quarter of 2025 and decreased 4.7% versus the second quarter of 2026. The Architecture Billings Index (ABI), a key leading indicator for nonresidential building and construction volume, has demonstrated a decline in billings (i.e., an index below 50) during 2026, including a recent sharp decrease in September of 2026. Nonresidential building and construction volume, which represented approximately 51% of total volume, decreased 14% driven by higher pricing, including significantly higher metal costs, and ongoing economic uncertainty. Within the specialty market, consumer durables volume decreased 22% due to cautionary consumer spending on discretionary purchases. Automotive and transportation volume declined 17%, reflecting continued economic uncertainty, higher input costs and trade related pressures affecting manufacturers, compared to the prior-year period, which benefited from customer orders placed in advance of higher tariffs. Partially offsetting the declines, within the specialty market, TSLOTSTM shipments increased 48%, supported by growing demand for modular aluminum framing systems.

Previous wording

Net new orders in the second quarter of 2026 increased slightly to an average of 3.2 million pounds per week versus an average of 3.1 million pounds per week in the second quarter of 2025, supported by increased activity in TSLOTSTMfor modular aluminum framing systems and renewable energy applications. Open orders at the end of the second quarter of 2026 were 23 million pounds versus 25 million pounds at the end of the second quarter of 2025 and 19 million pounds at the end of the first quarter of 2026. This level of open orders falls within the normalized level that is typically associated with stable demand patterns and healthy market dynamics.

Current wording

Net new orders in the third quarter of 2026 increased slightly to an average of 2.8 million pounds per week versus an average of 2.6 million pounds per week in the third quarter of 2025, supported by increased activity in TSLOTSTMfor modular aluminum framing systems. Open orders at the end of the third quarter of 2026 were 24 million pounds versus 19 million pounds at the end of the third quarter of 2025 and 23 million pounds at the end of the second quarter of 2026. This level of open orders falls within the normalized level that is typically associated with stable demand patterns and healthy market dynamics.

Previous wording

•A $5.2 million increase in contribution margin (net sales less variable costs) associated with:

Current wording

•A $13.1 million decrease in contribution margin (net sales less variable costs) associated with:

Previous wording

◦Lower volume ($1.9 million), higher labor rates ($2.0 million), unfavorable labor productivity primarily due to more labor intensive requirements for higher-value products ($1.0 million), higher maintenance, supply and die expense, partially associated with tariff impact ($0.8 million), and higher freight expense ($0.8 million), partially offset by pricing increases ($0.6 million) and favorable manufacturing costs primarily associated with casting capabilities due to scrap spreads, reflecting a wider cost differential between primary aluminum and recycled scrap input, and higher scrap utilization ($5.1 million favorable in the second quarter of 2026 versus $0.7 million unfavorable in the second quarter of 2025).

Current wording

◦Lower volume ($4.4 million), higher labor rates ($2.1 million), unfavorable labor productivity primarily due to a more labor intensive production mix ($0.4 million), higher maintenance associated with down equipment ($1.6 million) and higher freight expense ($0.4 million), partially offset by favorable pricing and mix ($2.4 million) and favorable manufacturing costs primarily associated with casting capabilities due to scrap spreads, reflecting a wider cost differential between primary aluminum and recycled scrap input, and higher scrap utilization ($0.8 million favorable in the third quarter of 2026 versus $0.5 million favorable in the third quarter of 2025).

Previous wording

◦The timing of the flow-through under the first-in, first-out ("FIFO") method of aluminum raw materials costs, which were previously acquired in a quickly changing commodity pricing environment, causing a temporary mismatch in the change in the cost of raw materials included in variable costs and the pass through to customers included in sales, resulted in a benefit of $4.9 million in the second quarter of 2026 versus a charge of $0.7 million in the second quarter of 2025.

Current wording

◦The timing of the flow-through under the first-in, first-out ("FIFO") method of aluminum raw materials costs, which were previously acquired in a dynamic pricing environment, causing a temporary mismatch in the change in the cost of raw materials included in variable costs and the pass through to customers included in sales, resulted in a charge of $2.8 million in the third quarter of 2026 versus a benefit of $4.3 million in the third quarter of 2025.

Previous wording

•Higher fixed costs primarily associated with wage and benefits increases ($0.5 million).

Current wording

•Higher fixed costs primarily associated with wage and benefits increases ($0.8 million).

Previous wording

Net sales in the first six months of 2026 increased 21.8% versus the first six months of 2025 primarily due to the pass-through of higher metal costs, partially offset by lower sales volume. Sales volume in the first six months of 2026 decreased 6.5% versus the first six months of 2025.

Current wording

Net sales in the first nine months of 2026 increased 17.2% versus the first nine months of 2025 primarily due to the pass-through of higher metal costs, partially offset by lower sales volume. Sales volume in the first nine months of 2026 decreased 8.3% versus the first nine months of 2025.

Previous wording

EBITDA from ongoing operations in the first six months of 2026 increased $7.8 million in comparison to the first six months of 2025 primarily due to:

Current wording

EBITDA from ongoing operations in the first nine months of 2026 decreased $6.5 million in comparison to the first nine months of 2025 primarily due to:

Previous wording

◦Favorable mix ($5.5 million) and favorable manufacturing costs primarily associated with casting capabilities due to scrap spreads, reflecting a wider cost differential between primary aluminum and recycled scrap input, and higher scrap utilization ($7.0 million favorable in the first six months of 2026 versus $0.9 million unfavorable in the first six months of 2025), partially offset by lower volume ($4.1 million), higher labor rates ($3.7 million), decreased labor productivity primarily due to more labor intensive requirements for higher-value products ($0.7 million), higher maintenance expense, primarily associated with downed equipment in the first quarter of 2026 and tariff impacts ($1.1 million), higher die expense, including tariff impact ($1.3 million), higher freight ($1.2 million), and higher utilities ($0.5 million).

Current wording

◦Lower volume ($8.4 million), higher labor rates ($5.8 million), unfavorable labor productivity primarily due to a more labor intensive production mix ($1.0 million), higher maintenance and supply expense, primarily associated with downed equipment and tariff impacts ($2.8 million), higher die expense, including tariff impact ($1.4 million) and higher freight ($1.6 million), partially offset by favorable mix ($7.9 million) and favorable manufacturing costs primarily associated with casting capabilities due to scrap spreads and higher scrap utilization ($7.8 million favorable in the first nine months of 2026 versus $0.3 million unfavorable in the first nine months of 2025).

Previous wording

◦The timing of the flow-through under the FIFO method of aluminum raw material costs, which were previously acquired in a quickly changing commodity pricing environment and passed through to customers, resulted in a benefit of $7.8 million in the first six months of 2026 versus a benefit of $1.0 million in the first six months of 2025.

Current wording

◦The timing of the flow-through under the FIFO method of aluminum raw material costs, which were previously acquired in a dynamic pricing environment and passed through to customers, resulted in a benefit of $5.0 million in the first nine months of 2026 versus a benefit of $5.4 million in the first nine months of 2025.

Previous wording

•Higher fixed costs primarily associated with wage and benefits-related expense increases ($1.1 million).

Current wording

•Higher fixed costs primarily associated with wage and benefits-related expense increases ($2.0 million).

Previous wording

•Higher SG&A expenses primarily associated with higher incentive compensation, partially offset by lower routine environmental compliance expense ($0.4 million).

Current wording

•Higher SG&A expenses of $0.8 million primarily associated with higher incentive compensation, partially offset by lower routine environmental compliance expense.

Previous wording

Market conditions remain impacted by U.S. trade policy. Following the increase in Section 232 aluminum tariffs to 50% in June 2025, Bonnell Aluminum experienced a decline in new orders of approximately 20%. Changes to the tariff structure announced in April 2026, which include measures intended to close the loophole that allowed undervalued aluminum extrusions to enter the U.S., appear to be contributing to a more balanced competitive environment.

Current wording

Market conditions remain impacted by U.S. trade policy. Changes to the tariff structure announced in April 2026, which include measures intended to close the loophole that allowed undervalued aluminum extrusions to enter the U.S., appear to be contributing to a more balanced competitive environment.

Previous wording

Conflict-driven disruptions in the Strait of Hormuz beginning in March 2026 have constrained shipments and raised costs, contributing to historically low U.S. inventory levels. In response to ongoing geopolitical tensions in the Middle East and resulting contraction of the global aluminum market, we have proactively diversified Bonnell Aluminum’s supply chain portfolio to support long-term stability. Through the remainder of 2026, we have successfully secured nearly all of Bonnell Aluminum’s aluminum supply requirements and are proactively reviewing Bonnell Aluminum’s 2027 supply needs and sources to minimize exposure to the Middle East. Simultaneously, we are optimizing billet casting operations at our Carthage, TN, and Newnan, GA facilities to overcome localized production constraints. These strategic shifts in our supply chain and internal capabilities continue to strengthen our operational resilience, positioning Bonnell Aluminum to meet customer demand.

Current wording

Conflict-driven disruptions in the Strait of Hormuz beginning in March 2026 have constrained shipments and raised costs, contributing to historically low U.S. inventory levels of aluminum. In response to ongoing geopolitical tensions in the Middle East and resulting contraction of the global aluminum market, we have proactively diversified Bonnell Aluminum’s supply chain portfolio to support long-term stability. Through the remainder of 2026, we have successfully secured nearly all of Bonnell Aluminum’s anticipated aluminum supply requirements and are proactively reviewing Bonnell Aluminum’s 2027 supply needs and sources to minimize exposure to the Middle East. Simultaneously, we are optimizing billet casting operations at our Carthage, TN and Newnan, GA facilities to overcome localized production constraints. These strategic shifts in our supply chain and internal capabilities are intended to strengthen our operational resilience, positioning Bonnell Aluminum to be a provider of innovative, custom-engineered aluminum solutions.

Previous wording

Capital expenditures for Bonnell Aluminum are projected to be $20 million in 2026, including $4 million for productivity projects and $16 million for capital expenditures required to support continuity of operations. Depreciation expense is projected to be $14 million in 2026. Amortization expense is projected to be $2 million in 2026. The Company anticipates capital spending for Bonnell Aluminum to increase from the levels of the past two years and return to a pattern more closely aligned with depreciation and amortization, consistent with long-term historical patterns. This approach supports ongoing maintenance and efficiency initiatives while maintaining disciplined capital allocation.

Current wording

Capital expenditures for Bonnell Aluminum are projected to be $17 million in 2026, including $4 million for productivity projects and $13 million for capital expenditures required to support continuity of operations. Depreciation expense is projected to be $15 million in 2026. Amortization expense is projected to be $2 million in 2026.

Previous wording

Net sales in the second quarterof 2026 increased 4.2% versus the second quarter of 2025 due to an increase in sales volume for surface protection films, partially offset by unfavorable mix in surface protection films. Surface Protection sales volume increased 17.8% in the second quarter of 2026 versus the second quarter of 2025. Volume for advanced packaging films, which are predominantly manufactured and sold in the U.S. and used in consumer staple items, decreased 17.8% in the second quarter of 2026 versus the second quarter of 2025.

Current wording

Net sales in the third quarterof 2026 decreased 8.1% versus the third quarter of 2025 due to a decrease in sales volume and unfavorable mix, partially offset by favorable pricing for surface protection films. Surface Protection sales volume decreased 18.6% in the third quarter of 2026 versus the third quarter of 2025 primarily due to weakened consumer electronics display market demand and inventory corrections. Volume for advanced packaging films, which are predominantly manufactured and sold in the U.S. and used in consumer staple items, decreased 6.8% in the third quarter of 2026 versus the third quarter of 2025.

Previous wording

•A decrease in contribution margin of $0.7 million resulting from:

Current wording

•A decrease in contribution margin of $2.6 million resulting from:

Previous wording

◦A $0.1 million increase from Surface Protection primarily due to favorable productivity and cost improvements ($0.8 million), partially offset by unfavorable mix ($0.2 million) and the pass-through lag associated with higher resin costs (a charge of $0.5 million in the second quarter of 2026 versus no charge or benefit in the second quarter of 2025).

Current wording

◦A $3.3 million decrease from Surface Protection primarily due to unfavorable volume and mix ($3.4 million) and the pass-through lag associated with higher resin costs (a charge of $0.5 million in the third quarter of 2026 versus a charge of $0.1 million in the third quarter of 2025), partially offset by cost improvements ($0.7 million).

Previous wording

◦A $0.8 million decrease from advanced packaging films primarily due to the pass-through lag associated with higher resin costs (a charge of $0.7 million in the second quarter of 2026 versus no charge or benefit in the second quarter of 2025).

Current wording

◦A $0.7 million increase from advanced packaging films primarily due to favorable mix ($0.3 million), cost improvements ($0.2 million) and the pass-through lag associated with higher resin costs (a benefit of $0.2 million in the third quarter of 2026 versus no charge or benefit in the third quarter of 2025).

Previous wording

•Lower SG&A expense associated with lower employee-related compensation ($0.3 million).

Current wording

•Lower SG&A expense associated with lower employee-related incentive compensation ($0.4 million).

Previous wording

•A foreign currency transaction loss of $0.3 million in the second quarter of 2026 versus no gain or loss in the second quarter of 2025.

Current wording

•A foreign currency transaction loss of $0.1 million in the third quarter of 2026 and in the third quarter of 2025.

Previous wording

Net sales in the first six months of 2026 decreased 5.9% compared to the first six months of 2025 primarily due to unfavorable mix in surface protection films. Surface Protection sales volume decreased 0.8% in the first six months of 2026 versus the first six months of 2025. Sales volume for surface protection films declined in the first six months of 2026 versus the first six months of 2025 as expected due to a significant customer’s inventory correction and scheduled maintenance activity for another customer in the first six months of 2026. Volume for advanced packaging films decreased 6.9% in the first six months of 2026 versus the first six months of 2025 primarily due to lower margin product. The top four customers comprised 85% and 86% of the net sales for High Performance Films for the first six months of 2026 and first six months of 2025, respectively.

Current wording

Net sales in the first nine months of 2026 decreased 6.7% compared to the first nine months of 2025 primarily due to lower volume and unfavorable mix, partially offset by favorable pricing in surface protection films. Surface Protection sales volume decreased 7.1% in the first nine months of 2026 versus the first nine months of 2025. Sales volume for surface protection films declined in the first nine months of 2026 versus the first nine months of 2025 as expected due to a significant customer’s inventory correction and scheduled maintenance activity for another customer in the first nine months of 2026. Volume for advanced packaging films decreased 6.9% in the first nine months of 2026 versus the first nine months of 2025 associated with lower margin product. The top four customers comprised 85% of the net sales for High Performance Films for the first nine months of 2026 and first nine months of 2025.