ESAB Corp

Previous wording

All statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (the “SEC”). Statements that could be deemed to be forward-looking statements, include statements regarding: the pending acquisition of Eddyfi Technologies and its anticipated benefits, the impact of the war in Ukraine and conflicts in the Middle East and the resulting escalating geopolitical tensions on our business; projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, impact of foreign exchange rates, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of our management for future operations, including statements relating to potential acquisitions, compensation plans or purchase commitments; developments, performance, industry or market rankings relating to products or services; future economic conditions or performance, including the impact of inflationary pressures, tariffs and trade policies, foreign exchange fluctuations and commodity prices; the outcome of outstanding claims or legal proceedings, including asbestos-related liabilities and insurance coverage litigation; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statement that addresses activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be, but are not always, characterized by terminology such as “believe,” “anticipate,” “should,” “would,” “could,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “targets,” “aims,” “seeks,” “sees” or similar expressions. These statements are based on assumptions and assessments made by our management as of the filing date of this Form 10-Q in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties and actual results or outcomes, or the timing of results or outcomes, could differ materially due to numerous factors, including but not limited to the following:

Current wording

All statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (the “SEC”). Statements that could be deemed to be forward-looking statements, include statements regarding: the acquisition of Eddyfi Holding Inc. (“Eddyfi”) and its anticipated benefits, the impact of the war in Ukraine and conflicts in the Middle East and the resulting escalating geopolitical tensions on our business; projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, impact of foreign exchange rates, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of our management for future operations, including statements relating to potential acquisitions, compensation plans or purchase commitments; developments, performance, industry or market rankings relating to products or services; future economic conditions or performance, including the impact of inflationary pressures, tariffs and trade policies, foreign exchange fluctuations and commodity prices; the outcome of outstanding claims or legal proceedings, including asbestos-related liabilities and insurance coverage litigation; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statement that addresses activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be, but are not always, characterized by terminology such as “believe,” “anticipate,” “should,” “would,” “could,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “targets,” “aims,” “seeks,” “sees” or similar expressions. These statements are based on assumptions and assessments made by our management as of the filing date of this Form 10-Q in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties and actual results or outcomes, or the timing of results or outcomes, could differ materially due to numerous factors, including but not limited to the following:

Previous wording

We expect strategic acquisitions to contribute to our growth. We believe that our extensive experience of acquiring and effectively integrating acquisition targets should enable us to capitalize on future opportunities. We believe our recent acquisitions are aligned with this strategic direction. On January 31, 2026, the Company entered into an agreement to acquire Eddyfi Technologies (“Eddyfi”), a global leader in advanced inspection and monitoring technologies headquartered in Quebec, Canada, for a purchase price of approximately $1.45 billion. For the year ended December 31, 2025, Eddyfi’s Revenues totaled approximately $240 million. Refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.

Current wording

We expect strategic acquisitions to contribute to our growth. We believe that our extensive experience of acquiring and effectively integrating acquisition targets should enable us to capitalize on future opportunities. We believe our recent acquisitions, are aligned with this strategic direction. On June 1, 2026, we acquired Eddyfi, a global leader in advanced inspection and monitoring technologies headquartered in Québec, Canada, for consideration transferred of approximately $1.5 billion (such transaction, the “Acquisition”). For the year ended December 31, 2025, Eddyfi’s revenues totaled approximately $240 million. Refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.

Previous wording

ESAB operates a diversified global supply chain and sources parts and materials globally. In February 2026, the United States Supreme Court (the “Court”) ruled that the International Emergency Economic Powers Act (“IEEPA”), which the United States administration (the “administration”) relied on to impose certain tariffs, does not authorize the administration to impose tariffs. On March 4, 2026, the United States Court of International Trade ordered the United States Customs and Border Protection (“CBP”) to process refunds of the IEEPA tariffs, although the Court immediately suspended the order while the CBP determines a refund process. The IEEPA tariffs remain subject to ongoing litigation between the administration and other parties. In response to the Court ruling mentioned above, the administration announced plans to implement new tariffs under alternative statutory authority. The full impact of the Court’s ruling and the administration’s response remains uncertain. In addition, the process for addressing requests for refunds of the IEEPA tariffs has recently begun, and the actual timing and extent of any such refunds remain uncertain at this time. Accordingly, we have not recorded any anticipated recovery of IEEPA tariffs paid as of April 3, 2026. We continue to actively monitor and evaluate these developments and the potential impacts of trade policy and tariffs on our business, supply chain and results of operations. We maintain operations worldwide, including in the jurisdictions impacted by the announced and contemplated tariffs. Refer to Part I. Item 1.A. “Risk Factors” in our 2025 Form 10-K for additional information. The full impact of the matters noted above on the Company, our customers and suppliers, the overall economy and capital markets remains uncertain.

Current wording

ESAB operates a diversified global supply chain and sources parts and materials globally. In February 2026, the United States Supreme Court (the “Court”) ruled that the International Emergency Economic Powers Act (“IEEPA”), which the United States administration (the “administration”) relied on to impose certain tariffs, does not authorize the administration to impose tariffs. On March 4, 2026, the United States Court of International Trade ordered the United States Customs and Border Protection (“CBP”) to process refunds of the IEEPA tariffs. The IEEPA tariffs remain subject to ongoing litigation between the administration and other parties. The full impact of the Court’s ruling and the administration’s response remains uncertain. The process for addressing requests for refunds of the IEEPA tariffs has recently begun. We have received an insignificant amount of IEEPA tariff refunds during the three months ended July 3, 2026. The actual timing and extent of any future refunds remain uncertain at this time. Accordingly, we have not recorded any IEEPA tariff refund receivables as of July 3, 2026. We continue to actively monitor and evaluate these developments and the potential impacts of trade policy and tariffs on our business, supply chain and results of operations. We maintain operations worldwide, including in the jurisdictions impacted by the announced and contemplated tariffs. Refer to Part I. Item 1.A. “Risk Factors” in our 2025 Form 10-K for additional information. The full impact of the matters noted above on the Company, our customers and suppliers, the overall economy and capital markets remains uncertain.

Previous wording

The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the three months ended April 3, 2026 and April 4, 2025.

Current wording

The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the three and six months ended July 3, 2026 and July 4, 2025.

Previous wording

The comparability of our operating results for the three months ended April 3, 2026 and April 4, 2025 is affected by the following significant factors:

Current wording

The comparability of our operating results for the three and six months ended July 3, 2026 and July 4, 2025 is affected by the following significant factors:

Previous wording

The conflict in the Middle East and the related impacts, such as logistics challenges from the closing of the Strait of Hormuz, have increased the level of economic and political uncertainty. As reflected in the discussions that follow, these logistics challenges have had a variety of impacts on our results of operations during the three months ended April 3, 2026, including decreased sales levels and increased inventory costs. Refer to Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.

Current wording

The conflict in the Middle East and the related impacts, such as logistics challenges from the closing of the Strait of Hormuz, have increased the level of economic and political uncertainty. As reflected in the discussions that follow, these challenges have had a variety of impacts on our results of operations during the six months ended July 3, 2026, including decreased sales levels and increased inventory costs. Refer to Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.

Previous wording

The Company continues to actively monitor the changes in United States policy regarding international trade, including the recent progress in reaching or progressing international trade agreements with major counterparties. As reflected in the discussions that follow, the United States policy regarding international trade and actions taken in response to it have had a variety of impacts on our results of operations during 2025 and the first quarter of 2026, including decreased sales levels and increased raw material costs. For additional information on the risks of United States policy regarding international trade to the Company’s operations, refer to Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.

Current wording

The Company continues to actively monitor the changes in United States policy regarding international trade, including the recent progress in reaching or progressing international trade agreements with major counterparties and the IEEPA tariff refund discussed above. As reflected in the discussions that follow, the United States policy regarding international trade and actions taken in response to it have had a variety of impacts on our results of operations during 2025 and the six months ended July 3, 2026, including decreased sales levels and increased raw material costs. For additional information on the risks of United States policy regarding international trade to the Company’s operations, refer to Part I. Item 1.A. “Risk Factors”section of the 2025 Form 10-K for additional information.

Previous wording

We complement our organic growth with acquisitions and other investments. Acquisitions can affect our reported results, and we report the change in our Net sales between periods both from existing and acquired businesses. The change in Net sales due to acquisitions for the periods presented in this filing represents the incremental sales as a result of acquisitions. For additional information on our acquisitions, refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q and Note 5, “Acquisitions” in the Company’s 2025 Form 10-K.

Current wording

We complement our organic growth with acquisitions and other investments. Acquisitions can affect our reported results, and we report the change in our Net sales between periods both from existing and acquired businesses. The change in Net sales due to acquisitions for the periods presented in this filing represents the incremental sales as a result of acquisitions, including the Acquisition that was completed on June 1, 2026. For additional information on our acquisitions, refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q and Note 5, “Acquisitions” in the Company’s 2025 Form 10-K.

Previous wording

A significant portion of our Net sales,79%for the three months ended April 3, 2026 are outside the United States, with the majority of those sales denominated in currencies other than the U.S. Dollar. Because much of our manufacturing and employee costs are outside the United States, a significant portion of our costs are also denominated in currencies other than the U.S. Dollar. Changes in foreign exchange rates can impact our results of operations and are quantified when significant.

Current wording

A significant portion of our Net sales,79%for the three and six months ended July 3, 2026, respectively, are outside the United States, with the majority of those sales denominated in currencies other than the U.S. Dollar. Because much of our manufacturing and employee costs are outside the United States, a significant portion of our costs are also denominated in currencies other than the U.S. Dollar. Changes in foreign exchange rates can impact our results of operations and are quantified when significant.

Previous wording

For the three months ended April 3, 2026 compared to thethree months ended April 4, 2025, fluctuations in foreign currencies increased Net sales by 5.5% and Gross profit by 5.5% and increased Selling, general and administrative expenses by 6.1%.

Current wording

For the three months ended July 3, 2026 compared to thethree months ended July 4, 2025, fluctuations in foreign currencies increased Net sales by 2.6%, Gross profit by 2.3% and Selling, general and administrative expenses by 2.6%.

Previous wording

Adjusted EBITDA is a non-GAAP performance measure that we include in this Form 10-Q because it is a key metric used by our management to assess our operating performance. ESAB presents this non-GAAP financial measure including and excluding Russia due to economic and political volatility caused by the Russia and Ukraine conflict, which we believe results in enhanced investor interest in these alternative presentations. Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense and other, net, Restructuring and other related charges, acquisition transaction, due diligence and integration expenses, amortization of intangibles and fair value step up on acquired inventories and depreciation and other amortization. We also present Adjusted EBITDA margin, which is subject to the same adjustments as Adjusted EBITDA. Further, we present these non-GAAP performance measures on a segment basis subject to the same adjustments described above. We also present Core adjusted EBITDA and Core adjusted EBITDA margin, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margin, respectively, and which removes the impact of Russia for the three months ended April 3, 2026 and April 4, 2025. Adjusted EBITDA and Core adjusted EBITDA assist management in comparing our operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from our ongoing productivity and core business. Management also believes that presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.

Current wording

Adjusted EBITDA is a non-GAAP performance measure that we include in this Form 10-Q because it is a key metric used by our management to assess our operating performance. ESAB presents this non-GAAP financial measure including and excluding Russia due to economic and political volatility caused by the Russia and Ukraine conflict, which we believe results in enhanced investor interest in these alternative presentations. Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense and other, net, Restructuring and other related charges, acquisition transaction, due diligence and integration expenses, amortization of intangibles and fair value step up on acquired inventories, depreciation and other amortization and compensation expense related to the performance-based non-qualified stock option awards granted on June 10, 2026 and July 1, 2026 (the “Performance Option Awards”). We also present Adjusted EBITDA margin, which is subject to the same adjustments as Adjusted EBITDA. Further, we present these non-GAAP performance measures on a segment basis subject to the same adjustments described above. We also present Core adjusted EBITDA and Core adjusted EBITDA margin, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margin, respectively, and which removes the impact of Russia for the three and six months ended July 3, 2026 and July 4, 2025. Adjusted EBITDA and Core adjusted EBITDA assist management in comparing our operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from our ongoing productivity and core business. Management also believes that presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.

Previous wording

The following tables set forth a reconciliation of Net income from continuing operations, the most directly comparable GAAP financial measure, to Adjusted EBITDA, Adjusted EBITDA margin, Core adjusted EBITDA and Core adjusted EBITDA margin by segment for the three months ended April 3, 2026 and April 4, 2025.

Current wording

The following tables set forth a reconciliation of Net income from continuing operations, the most directly comparable GAAP financial measure, to Adjusted EBITDA, Adjusted EBITDA margin, Core adjusted EBITDA and Core adjusted EBITDA margin by segment for the three and six months ended July 3, 2026 and July 4, 2025.

Previous wording

(2)Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines.

Current wording

(2)Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets, costs associated with disposing of discontinued products and other costs in connection with the closure and optimization of facilities and product lines.

Previous wording

(3)Includes transaction, diligence and integration expenses totaling $10.3 million for the three months ended April 3, 2026 and amortization of intangibles and fair value step up on acquired inventories totaling $12.5 million for the three months ended April 3, 2026.

Current wording

(3)Includes transaction, diligence and integration expenses totaling $24.8 million and $35.1 million for the three and six months ended July 3, 2026, respectively, and amortization of intangibles and fair value step up on acquired inventories totaling $16.5 million and $29.0 million for the three and six months ended July 3, 2026, respectively.

Previous wording

(5)Net sales were$31.1 million relating to Russia for thethree months ended April 3, 2026.

Current wording

(6)Net sales were$41.4 million and $72.5 million relating to Russia for the three andsix months ended July 3, 2026, respectively.

Previous wording

(3)Includes transaction, diligence and integration expenses totaling $1.4 million for the three months ended April 4, 2025 and amortization of intangibles and fair value step up on acquired inventories totaling $8.2 million for the three months ended April 4, 2025.

Current wording

(3)Includes transaction, diligence and integration expenses totaling $12.8 million and $14.2 million for the three and six months ended July 4, 2025, respectively, and amortization of intangibles and fair value step up on acquired inventories totaling $8.8 million and $17.0 million for the three and six months ended July 4, 2025, respectively.

Previous wording

(5)Net sales were $31.3 million relating to Russia for the three months ended April 4, 2025.

Current wording

(5)Net sales were $37.1 million and $68.4 million relating to Russia for the three and six months ended July 4, 2025, respectively.

Previous wording

The following table presents the components of changes in our Net salesfor the three months ended April 3, 2026 compared to the prior year period.

Current wording

The following table presents the components of changes in our Net salesfor the three and six months ended July 3, 2026 compared to the prior year period.

Previous wording

Net sales from existing businesses decreased by $12.6 million during the three months ended April 3, 2026, compared to the prior year period, due to a $21.7 million decrease in sales volume due to drivers such as tariffs in the Americas, logistics challenges in Middle East related to the war in Iran and lower volumes in Russia partially offset by customer pricing increases of $9.0 million. The increase in net sales from acquisitions was attributable to Bavaria Schweisstechnik (“Bavaria”), DeltaP s.r.l. (“DeltaP”), Aktiv Technologies Private Limited (“Aktiv”) and EWM GmbH (“EWM”). The changes in foreign exchange rates resulted in a $37.3 million favorable currency translation impact.

Current wording

Net sales from existing businesses increased by $17.9 million during the three months ended July 3, 2026, compared to the prior year period, driven by increases in both customer pricing and sales volume totaling $14.9 million and $3.1 million, respectively. The $14.9 million increase in customer pricing was largely driven by the higher materials costs resulting from factors such as tariffs in the Americas and rising oil prices caused by the war in Iran. Additionally, there was an increase in Net sales from acquisitions attributable to Bavaria Schweisstechnik (“Bavaria”), DeltaP s.r.l. (“DeltaP”), Aktiv Technologies Private Limited (“Aktiv”), EWM GmbH (“EWM”) and Eddyfi. The changes in foreign exchange rates resulted in a $18.6 million favorable currency translation impact.

Previous wording

The following table presents the components of changes in our Net sales excluding Russia (“Core sales”) for the three months ended April 3, 2026 compared to the prior year period.

Current wording

The following table presents the components of changes in our Net sales excluding Russia (“Core sales”) for the three and six months ended July 3, 2026 compared to the prior year period.

Previous wording

(2)Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume.

Current wording

(2) Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume.

Previous wording

(5)Net sales relating to Russia were $31.1 million and $31.3 million for the three months ended April 3, 2026 and April 4, 2025, respectively.

Current wording

(5)Net sales relating to Russia were $41.4 million and $37.1 million for the three months ended July 3, 2026 and July 4, 2025, respectively, and $72.5 million and $68.4 million for the six months ended July 3, 2026 and July 4, 2025, respectively.

Previous wording

Core Sales from existing businesses decreased by $7.4 million during the three months ended April 3, 2026, compared to the prior year period, primarily due to a $17.0 million decrease in sales volume due to drivers such as tariffs in the Americas and logistics delays in Middle East related to the war in Iran partially offset by $9.5 million of customer pricing increases. The increase in net sales from acquisitions was attributable to Bavaria, DeltaP, Aktiv and EWM. The changes in foreign exchange rates resulted in a $32.2 million favorable currency translation impact.

Current wording

Core sales from existing businesses increased by $9.3 million during the six months ended July 3, 2026, compared to the prior year period, primarily due to $24.3 million of customer pricing increases partially offset by a $15.0 million decrease in sales volume due to drivers such as tariffs in the Americas and challenges in Middle East related to the war in Iran. The $24.3 million increase in customer pricing was largely driven by the higher materials costs resulting from factors such as tariffs in the Americas and rising oil prices caused by the war in Iran. The $15.0 million decrease in sales volume was primarily from the first quarter as the tariff impacts in the second quarter were comparable to prior year as increased tariffs were first imposed in April 2025. Additionally, the increase in Net sales from acquisitions was attributable to Bavaria, DeltaP, Aktiv, EWM and Eddyfi. The changes in foreign exchange rates resulted in a $47.8 million favorable currency translation impact.

Previous wording

(2) Includes transaction, diligence and integration expenses totaling $10.3 million for the three months ended April 3, 2026 and $1.4 million for the three months ended April 4, 2025. Additionally, it includes amortization of intangibles and fair value step up on acquired inventories totaling $12.5 million for the three months ended April 3, 2026 and $8.2 million for the three months ended April 4, 2025.

Current wording

(2) Includes transaction, diligence and integration expenses totaling $24.8 million and$35.1 million for the three and six months ended July 3, 2026, respectively, and $12.8 million and$14.2 million for the three and six months ended July 4, 2025, respectively. Additionally, it includes amortization of intangibles and fair value step up on acquired inventories totaling $16.5 million and$29.0 million for the three and six months ended July 3, 2026, respectively, and $8.8 million and$17.0 million for the three and six months ended July 4, 2025, respectively.

Previous wording

Gross profit increased $19.9 million in the three months ended April 3, 2026 compared to the prior year period primarily attributable to acquisitions and foreign exchange partially offset by tariff-related cost increases, net of customer pricing, product mix and a decrease in sales volume. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment caused by tariff-related price pass-through to customers as well as higher freight and material costs due to oil price increases from the war in Iran. Selling, general and administrative expense increased $33.6 million in the three months ended April 3, 2026 compared to the prior year period primarily due to acquisitions and related transaction costs and foreign exchange impact. Interest expense and other, net increased by $8.8 million due to $4.8 million of costs associated with the Bridge Loan that the Company entered into to fund the Eddyfi acquisition as well as a higher average outstanding debt balance. The effective tax rate of 20.2% for the three months ended April 3, 2026 differed from the effective tax rate of 22.0% for the same period ended April 4, 2025 due to favorable provisions related to FDDEI under the One Big Beautiful Bill Act that were effective beginning with the 2026 tax year.

Current wording

Restructuring and other related charges increased by $22.6 million in the six months ended July 3, 2026 compared to the prior year period primarily driven by strategic initiatives to improve margins in the Americas and the EWM acquisition. Acquisition-amortization and other related charges increased by$32.9 million in the six months ended July 3, 2026 compared to the prior year period primarily driven by recent acquisition activity attributable to EWM and Eddyfi. Interest expense and other, net increased by $18.4 million in the six months ended July 3, 2026 compared to the prior year period due to $4.8 million of fees associated with the Bridge Loan commitment that the Company entered into to fund the Acquisition as well as a higher average outstanding debt balance. The effective tax rate of 22.0% for the six months ended July 3, 2026 differed from the effective tax rate of 21.4% for the same period ended July 4, 2025 primarily due to the tax effects related to the Acquisition.

Previous wording

Net income from continuing operations decreased $20.8 million in the three months ended April 3, 2026 compared to the prior year period primarily due to the aforementioned factors as well as higher Restructuring and other related charges primarily driven by strategic initiatives to improve margins in the Americas and the integration of the recent EWM acquisition and higher Acquisition-amortization and other related charges related to the recent acquisition and integration activity. Adjusted EBITDA increased $2.7 million in the three months ended April 3, 2026 compared to the prior year period primarily due to the aforementioned. Core adjusted EBITDA increased by $8.0 million compared to the same period in the prior year primarily due to the aforementioned factors. Adjusted EBITDA attributable to Russia decreased by $5.3 million largely due to relocating the Russia manufacturing plant from an owned property to a leased property and expenses associated with this relocation project as well as shifting of product mix from higher to lower margin products in response to shifts in demand and decreases in customer pricing while material costs continue to increase. The decline of Core adjusted EBITDA margin was primarily due to dilution from the EWM acquisition as well as higher freight and material costs due to oil price increases from the war in Iran.

Current wording

Net income from continuing operations decreased $54.2 million in the six months ended July 3, 2026 compared to the prior year period primarily due to the aforementioned factors. Adjusted EBITDA increased $10.5 million in the six months ended July 3, 2026 compared to the prior year period primarily due to the aforementioned factors. Core adjusted EBITDA increased by $19.1 million compared to the same period in the prior year primarily due to the aforementioned factors. Adjusted EBITDA attributable to Russia decreased by $8.5 million largely due to relocating the Russia manufacturing plant from an owned property to a leased property and expenses associated with this relocation project as well as shifting of product mix from higher to lower margin products in response to shifts in demand and decreases in customer pricing while material costs continue to increase. The decline of Core adjusted EBITDA margin was primarily due to dilution from the EWM acquisition as well as higher freight and material costs due to oil price increases from the war in Iran.

Previous wording

Net sales in our Americas segment increased $7.7 million in the three months ended April 3, 2026 compared with the prior year period. Net sales from existing business decreased $2.1 million due to reduced sales volumes primarily driven by tariffs and related impacts partially offset by pricing increases. In addition, there was a $9.8 million favorable increase in currency translation. Gross profit increased $1.4 million attributable to favorable foreign exchange impact and price increases partially offset by higher material costs and volume. The decline of gross profit margin was primarily due to the dilutive effect in the Americas segment, which was caused by tariff-related price pass-through to customers. Selling, general and administrative expense increased $2.3 million compared with the prior year period primarily due to foreign exchange impact. Restructuring and other related charges increased $7.3 million in thethree months ended April 3, 2026 compared with the prior year period primarily driven by strategic initiatives to improve margins in the Americas. Adjusted EBITDA increased $1.5 million compared to the prior year period primarily due to the aforementioned factors.

Current wording

Net sales in our Americas segment increased $40.9 million in the six months ended July 3, 2026 compared with the prior year period. Net sales from existing business increased $11.8 million due to customer pricing increases partially offset by reduced sales volumes primarily driven by tariffs and related impacts. The Acquisition contributed to a $9.6 million increase in Net sales from acquisitions. In addition, there was a $19.5 million favorable increase in currency translation. Gross profit increased $16.6 million attributable to favorable foreign exchange impact, accretion from acquisitions and price increases partially offset by higher material costs and lower volume. Selling, general and administrative expense increased $19.5 million compared with the prior year period primarily due to accretion from acquisitions and higher overall costs from general inflation and annual merit increase impact. Restructuring and other related charges increased $25.1 million in thesix months ended July 3, 2026 compared with the prior year period primarily driven by strategic initiatives to improve margins in the Americas. Adjusted EBITDA increased $8.7 million compared to the prior year period primarily due to the aforementioned factors.

Previous wording

Net sales in our EMEA & APAC segment increased $59.8 million in the three months ended April 3, 2026 compared with the prior year period. Net sales from existing business decreased $10.5 million primarily resulting from volume decreases from logistics challenges in the Middle East related to the war in Iran and lower volumes in Russia. This decrease was more than offset by $42.8 million of Net sales from the Bavaria, DeltaP, Aktiv and EWM acquisitions and $27.5 million in favorable foreign currency impact. Gross profit increased $18.5 million in the three months ended April 3, 2026 compared with the prior year period due to acquisitions and favorable foreign exchange impact partially offset by lower volumes and higher material costs. The decline of gross profit margin was primarily attributable to higher freight and material costs due to oil price increases from the war in Iran as well as plant relocation costs and an unfavorable product mix in Russia in 2026. Selling, general and administrative expense increased $31.3 million in the three months ended April 3, 2026 compared with the prior year period primarily due to acquisitions and related costs and foreign exchange impact. Acquisition - amortization and other related charges increased $11.1 million in thethree months ended April 3, 2026 compared with the prior year period primarily driven by the EWM acquisition. Adjusted EBITDA increased $1.2 million and Core adjusted EBITDA increased $6.5 million in the three months ended April 3, 2026 compared with the prior year period primarily due to the aforementioned factors. The decline of Core adjusted EBITDA margin was primarily due to dilution from the EWM acquisition as well as higher freight and material costs due to oil price increases from the war in Iran.

Current wording

Net sales in our EMEA & APAC segment increased $118.6 million in the six months ended July 3, 2026 compared with the prior year period. Net sales from existing business decreased $6.5 million primarily resulting from volume decreases related to challenges in the Middle East related to the war in Iran and lower volumes in Russia partially offset by increases in customer pricing. This decrease was more than offset by $88.8 million of Net sales from acquisitions from Bavaria, DeltaP, Aktiv, EWM and Eddyfi as well as $36.4 million in favorable foreign currency impact. Gross profit increased $44.5 million in the six months ended July 3, 2026 compared with the prior year period due to accretion from acquisitions and favorable foreign exchange impact partially offset by lower volumes and higher material costs. Selling, general and administrative expense increased $68.8 million in the six months ended July 3, 2026 compared with the prior year period primarily due to acquisitions and related costs and foreign exchange impact as well as higher overall costs from general inflation and annual merit increase impact. Acquisition - amortization and other related charges increased $22.8 million in thesix months ended July 3, 2026 compared with the prior year period primarily driven by the EWM and Eddyfi acquisitions. Adjusted EBITDA increased $1.8 million and Core adjusted EBITDA increased $10.3 million in the six months ended July 3, 2026 compared with the prior year period primarily due to the aforementioned factors. The decline of adjusted EBITDA margin and Core adjusted EBITDA margin was primarily due to dilution from the EWM acquisition as well as higher freight and material costs due to oil price increases related to the war in Iran.

Previous wording

As of April 3, 2026, we were in compliance with the covenants under the A&R Credit Agreement and the Indentures. The Company’s weighted average interest rate of borrowings under the Credit Agreement and the Indentures was 5.45%, excluding accretion of deferred financing fees. As of the end of the first quarter, we had the capacity for additional indebtedness of up to $1,050 million available on the Revolving Facility. Additionally, we have the ability to incur $73.1 million of indebtedness pursuant to certain uncommitted credit lines, consisting primarily of an uncommitted credit line that we currently have in place, which we have used from time to time in the past for short-term working capital needs. Refer to Note 9, “Debt” and Note 10, “Derivatives” in the accompanying Notes contained elsewhere in this Form 10-Q for more information related to the Company’s debt and derivative instruments. We believe that we could raise additional funds in the form of debt or equity if it were determined to be appropriate for strategic acquisitions or other corporate purposes. We believe that our sources of liquidity between debt and cash flows from operating activities are adequate to fund our operations for the next twelve months and thereafter.

Current wording

As of July 3, 2026, we were in compliance with the covenants under the A&R Credit Agreement and the Indentures. The Company’s weighted average interest rate of borrowings under the Credit Agreement and the Indentures was 5.39%, excluding accretion of deferred financing fees. As of the end of the second quarter, we had the capacity for additional indebtedness of up to $690 million available on the Revolving Facility. Additionally, we had the ability to incur $72.9 million of indebtedness pursuant to certain uncommitted credit lines, consisting primarily of an uncommitted credit line that we currently have in place, which we have used from time to time in the past for short-term working capital needs. Refer to Note 9, “Debt” and Note 10, “Derivatives” in the accompanying Notes contained elsewhere in this Form 10-Q for more information related to the Company’s debt and derivative instruments. We believe that we could raise additional funds in the form of debt or equity if it we determined it to be appropriate for strategic acquisitions or other corporate purposes. We believe that our sources of liquidity between debt and cash flows from operating activities are adequate to fund our operations for the next twelve months and thereafter.

Previous wording

As of April 3, 2026, the Company had$1.0 billion of Cash and cash equivalents, an increase of $818.9 million from the balance of$185.9 millionas of December 31, 2025.

Current wording

As of July 3, 2026, the Company had$217.5 million of Cash and cash equivalents, an increase of $31.6 million from the balance of$185.9 millionas of December 31, 2025.

Previous wording

•Discontinued operations for the three months ended April 3, 2026 and April 4, 2025 included outflows of $4.3 million and $2.3 million, respectively, which were primarily asbestos-related.

Current wording

•Discontinued operations for the six months ended July 3, 2026 and July 4, 2025 included outflows of $11.8 million and $7.2 million, respectively, which were primarily asbestos-related.

Previous wording

•Restructuring initiative payments were $9.1 million and $3.3 million for the three months ended April 3, 2026 and April 4, 2025, respectively. Refer to Note 8, “Accrued and Other liabilities” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.

Current wording

•Restructuring initiative payments were $22.4 million and $5.9 million for the six months ended July 3, 2026 and July 4, 2025, respectively. Refer to Note 8, “Accrued and Other liabilities” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.

Previous wording

Cash flows used in investing activities during the three months ended April 3, 2026 and April 4, 2025 are primarily comprised of purchases of property, plant and equipment.

Current wording

Cash flows used in investing activities during the six months ended July 3, 2026 and July 4, 2025 are primarily comprised of the Acquisition for $1.5 billion, net of cash received in addition to purchases of property, plant and equipment.

Previous wording

Cash flows provided by financing activities during the three months ended April 3, 2026 are primarily comprised of the proceeds from borrowings on the 2031 Senior Notes partially offset by net repayments of borrowings on the revolving facilities and debt issuance costs.

Current wording

Cash flows provided by financing activities during the six months ended July 3, 2026 are primarily comprised of the proceeds from borrowings on the 2031 Senior Notes and the revolving facilities, partially offset by repayments of borrowings on the revolving facilities and debt issuance costs in addition to the proceeds from the issuance of Common stock and MCPS in connection with the Acquisition.

Previous wording

Our Cash and cash equivalents as of April 3, 2026 included $193.8 million held in jurisdictions outside the United States. Cash repatriation of non-United States cash into the United States may be subject to withholding taxes, other local statutory restrictions and minority owner distributions.

Current wording

Our Cash and cash equivalents as of July 3, 2026 included $194.9 million held in jurisdictions outside the United States. Repatriation of cash into the United States may be subject to withholding taxes, other international and local statutory restrictions and regulations and minority owner distributions.