Atmus Filtration Technologies Inc.

Previous wording

The following is our discussion and analysis of changes in our financial condition and results of operations for thethree and nine months ended September 30, 2025 compared to thethree and nine months ended September 30, 2024.

Current wording

The following is our discussion and analysis of changes in our financial condition and results of operations for thethree months ended March 31, 2026 compared to thethree months ended March 31, 2025.

Previous wording

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995, including, without limitation, those that are based on current expectations, estimates and projections about the industries in which we operate and management’s views, plans, objectives, projections, beliefs and assumptions. Forward-looking statements may be identified by the use of words such as “anticipates,” “expects,” “forecasts,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “could,” “should,” “may” or words of similar meaning. Examples of forward-looking statements include, but are not limited to, statements we make regarding the outlook for our future business and financial performance, the development of future operations, the impact of planned acquisitions and dispositions, our strategy for growth, product development activities, regulatory approvals, market position, expenditures and the effects of the Full Separation, Separation and IPO (each as defined in Note 1, Description of the Business, to our Condensed Consolidated Financial Statements included herein). These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which we refer to as “future factors,” which are difficult to predict. If the underlying assumptions prove inaccurate, or known or unknown risks or uncertainties materialize, our actual outcomes, results and financial condition may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Future factors and uncertainties include, but are not limited to:

Current wording

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995, including, without limitation, those that are based on current expectations, estimates and projections about the industries in which we operate and management’s views, plans, objectives, projections, beliefs and assumptions. Forward-looking statements may be identified by the use of words such as “anticipates,” “expects,” “forecasts,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “could,” “should,” “may” or words of similar meaning. Examples of forward-looking statements include, but are not limited to, statements we make regarding the outlook for our future business and financial performance, the development of future operations, the impact of planned acquisitions and dispositions, our strategy for growth, product development activities, regulatory approvals, market position and expenditures. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which we refer to as “future factors,” which are difficult to predict. If the underlying assumptions prove inaccurate, or known or unknown risks or uncertainties materialize, our actual outcomes, results and financial condition may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Future factors and uncertainties include, but are not limited to:

Previous wording

•Potential failure of performance by Atmus or Cummins under transaction agreements executed as part of the Separation;

Current wording

•Potential failure of performance by Atmus or Cummins under transaction agreements executed as part of the initial public offering;

Previous wording

•Substantial indebtedness from Atmus’ term loan and revolving credit facility, which may impact Atmus’ ability to service all its indebtedness and react to changes in the industry; and

Current wording

•Substantial indebtedness consisting of Atmus’ term loan and revolving credit facility, which may impact Atmus' ability to service all its indebtedness and react to changes in the industry; and

Previous wording

We are one of the global leaders of filtration products for on-highway commercial vehicles and off-highway agriculture, construction, mining and power generation vehicles and equipment. We design and manufacture advanced filtration products, principally under the Fleetguard brand, that provide superior asset protection and enable lower emissions. We estimate that approximately 14% of our net sales in 2024 were generated through first-fit sales to OEMs, where our products are installed as components for new vehicles and equipment. We estimate that approximately 86% of our net sales in 2024 were generated in the aftermarket, where our products are installed as replacement or repair parts, leading to a strong recurring revenue base. Building on our more than 65-year history, we continue to grow and differentiate ourselves through our global footprint, comprehensive offering of premium products, technology leadership and multi-channel path to market.

Current wording

We are one of the global leaders of filtration products and solutions. Our reportable operating segments consist of Power Solutions and Industrial Solutions. The Power Solutions Segment consists of products for on-highway commercial vehicles and off-highway agriculture, construction, mining vehicles and equipment. We design and manufacture advanced filtration products, principally under the Fleetguard brand, that provide superior asset protection and enable lower emissions. We estimate that approximately 14% of our net sales in 2025 were generated through first-fit sales to OEMs, where our products are installed as components for new vehicles and equipment. We estimate that approximately 86% of our net sales in 2025 were generated in the aftermarket, where our products are installed as replacement or repair parts, leading to a strong recurring revenue base. The Industrial Solutions segment was created with the acquisition of Koch Filter on January 7, 2026. The Industrial Solutions segment addresses high-growth end markets including commercial and industrial HVAC, data centers and power generation environments. Products include a broad portfolio of air filtration solutions. Building on our more than 65-year history, we continue to grow and differentiate ourselves through our global footprint, comprehensive offering of premium products, technology leadership and multi-channel path to market.

Previous wording

During 2025, the United States announced changes to U.S. trade policy, including increasing tariffs on imports, in some cases significantly, and potentially negotiating or terminating existing trade agreements. The United States also indicated that tariffs may change and that additional measures are under consideration to be introduced. These tariff and tariff-related measures include potential impacts to the industry in which we operate and the commodities to which our products are exposed. These actions, along with corresponding retaliatory tariffs imposed by other countries on U.S. exports, have led to significant volatility and uncertainty in global demand in both aftermarket and first-fit. In response to these developments, we mitigated the cost impact on our business by employing any exemptions for which we were eligible, such as compliance under the United States-Mexico-Canada Agreement (“USMCA”), adjusting our supply chain, and implementing select price adjustments. We will continue to evaluate opportunities to offset these costs and mitigate the impact on our business, consolidated results of operations and financial condition. Given the uncertainties, it is difficult to estimate the evolving tariff and policy landscape which may have a material impact on our profitability going forward.

Current wording

During 2025, the United States announced changes to U.S. trade policy, including increasing tariffs on imports, in some cases significantly, and potentially negotiating or terminating existing trade agreements. The United States also indicated that tariffs may change and that additional measures are under consideration to be introduced. These tariff and tariff-related measures include potential impacts to the industry in which we operate and the commodities to which our products are exposed. These actions, along with corresponding retaliatory tariffs imposed by other countries on U.S. exports, have led to significant volatility and uncertainty in global demand in both aftermarket and first-fit. In response to these developments, we mitigated the cost impact on our business by employing any exemptions for which we were eligible, such as compliance under the United States-Mexico-Canada Agreement (“USMCA”), adjusting our supply chain, and implementing select price adjustments. In February of 2026, the U.S. Supreme Court held that tariffs imposed pursuant to the International Emergency Economic Powers Act (“IEEPA”) exceeded the statutory authority granted under that law. The ruling, however, did not address potential refunds of any previous tariffs. On March 4, 2026, the Court of International Trade ordered U.S. Customs and Border Protection to begin the refund process for all importers who were subject to IEEPA duties.

Previous wording

Our financial performance depends, in large part, on varying conditions in the markets we serve. Demand in these markets tends to fluctuate in response to overall economic conditions. Our revenues may also be impacted by OEM inventory levels, production schedules, commodity prices, work stoppages and supply chain challenges. Economic downturns in markets we serve generally result in reduced sales of our products and can result in price reductions in certain products and/or markets. As a worldwide business, our operations are also affected by currency exchange rate changes, political and economic uncertainty (including tariffs and trade barriers), public health crises (epidemics or pandemics) and regulatory matters, including adoption and enforcement of environmental and emission standards in the countries we serve. Some of the more important factors affecting our performance are briefly discussed below.

Current wording

Our financial performance depends, in large part, on varying conditions in the markets we serve. Demand in these markets tends to fluctuate in response to overall economic conditions. Our revenues may also be impacted by customer inventory levels, production schedules, commodity prices, work stoppages and supply chain challenges. Economic downturns in markets we serve generally result in reduced sales of our products and can result in price reductions in certain products and/or markets. As a worldwide business, our operations are also affected by currency exchange rate changes, political and economic uncertainty (including tariffs and trade barriers), public health crises (epidemics or pandemics) and regulatory matters, including adoption and enforcement of environmental and emission standards in the countries we serve. Some of the more important factors affecting our performance are briefly discussed below.

Previous wording

Aftermarket demand remained soft in the first nine months of 2025. We continue to be in a period of slow growth in global aftermarkets, and this trend is expected to continue for the remainder of 2025. First-fit experienced reduced demand in the first nine months of 2025 reflecting depressed market conditions. First-fit demand is expected to remain at reduced levels through 2025 based on overall market cyclicality.

Current wording

Aftermarket demand remained soft in the first three months of 2026. We continue to be in a period of slow growth in global aftermarkets, and this trend is expected to continue for the remainder of 2026. First-fit demand continues to reflect depressed market conditions with recovery expected in the latter half of 2026.

Previous wording

Commodity prices, labor, inflation and foreign currency exchange rates

Current wording

Commodity prices, logistics costs, labor, inflation and foreign currency exchange rates

Previous wording

We have experienced general variability in direct material costs through the first nine months of 2025. While the costs of our principal materials fluctuate, generally we believe there will continue to be an adequate supply of the materials we use and that they will broadly remain available.

Current wording

We have experienced general variability in direct material costs through the first three months of 2026. While the costs of our principal materials fluctuate, generally we believe there will continue to be an adequate supply of the materials we use and that they will broadly remain available.

Previous wording

Overall supply chain conditions remained largely stable in the first nine months of 2025 with minimal disruptions being experienced. Logistics costs increased during the first nine months of 2025, primarily due to the transition to a standalone distribution network as part of the Separation and the impact of tariffs. Our management team continues to monitor and evaluate all of the factors affecting our supply chain condition and the related impacts on our business and operations, and we continue to minimize any supply chain impacts to our business and to our customers.

Current wording

Logistics and warehousing costs increased during the first three months of 2026, primarily due to macro-economic conditions and the transition to a standalone distribution network as part of ourseparation from Cummins Inc. (“Cummins”) into a standalone publicly traded company (the “Separation”). Our management team continues to monitor and evaluate all of the factors affecting our supply chain condition and the related impacts on our business and operations, and we continue to minimize any supply chain impacts to our business and to our customers.

Previous wording

Additionally, the depreciation of the U.S. dollar against certain foreign currencies had an unfavorable impact on our condensed consolidated results of operations in the first nine months of 2025 due to translation impacts. We remain in a volatile currency environment and as such, there can be no assurances that this trend will continue for the remainder of 2025.

Current wording

Additionally, the appreciation of the U.S. dollar against certain foreign currencies had a favorable impact on our condensed consolidated results of operations in the first three months of 2026 due to translation impacts. We remain in a volatile currency environment and as such, there can be no assurances that this trend will continue for the remainder of 2026.

Previous wording

We have incurred additional costs associated with becoming a standalone public company. During the three months ended September 30, 2025, we incurred approximately$3.7 million of one-time expenses including $2.5 million within Cost of sales and $1.2 million within Selling, general and administrative expenses. During the nine months ended September 30, 2025, we incurred approximately$15.5 million of one-time expenses including $11.2 million within Cost of sales and $4.3 million within Selling, general and administrative expenses. In addition, we have incurred capital expenditures in connection with the Separation of approximately$9.5 million in 2025. These expenses and capital expenditures primarily relate to the establishment of functions previously co-mingled with Cummins, such as information technologies, distribution centers, manufacturing and human resources. The one-time costs incurred during the three months ended September 30, 2025, were primarily associated with our technology transformation and modernization project. The transition services agreement under which Cummins had continued to provide certain services related primarily to administrative services ended in September 2025. With the conclusion of this agreement, we do not expect to incur any additional one-time expenses or capital expenditures in 2025 or in future periods in connection with becoming a standalone public company.

Current wording

In the historical periods following the Separation until the ending of the transition services agreement with Cummins in September 2025, we incurred additional costs associated with becoming a standalone public company. These expenses and capital expenditures primarily relate to the establishment of functions previously co-mingled with Cummins, such as information technologies, distribution centers, manufacturing and human resources. Under the transition services agreement, Cummins continued to provide certain services related primarily to administrative services. With the conclusion of this agreement, we do not expect to incur any additional one-time expenses or capital expenditures in 2026 or any future periods in connection with becoming a standalone public company.

Previous wording

Net sales were$447.7 million for the three months ended September 30, 2025, an increase of$44.0 million compared to$403.7 million for the three months ended September 30, 2024. The increase in Net sales was mainly due to favorable volumes of $25.8 million, pricing of $14.9 million and favorable impacts of currency of $3.3 million. The favorable impact from pricing is primarily driven by normal pricing initiatives and select increases as a result of tariffs.

Current wording

Net sales were$477.5 million for the three months ended March 31, 2026, an increase of$61.0 million compared to$416.5 million for the three months ended March 31, 2025. The increase in Net sales was mainly due to incremental sales of $38.4 million recorded by Koch Filter, acquired in January 2026, favorable impacts of currency of $16.3 million and favorable pricing of $8.3 million, partially offset by lower volumes of $2.0 million. The favorable impact from pricing is primarily driven by normal pricing initiatives and select increases as a result of tariffs.

Previous wording

Gross margin was$129.4 million for the three months ended September 30, 2025, an increase of$18.1 million compared to$111.3 million for the three months ended September 30, 2024. The increase in Gross margin was mainly due to favorable pricing of $14.9 million as described above, favorable volumes of $9.0 million, favorable manufacturing and other costs of $6.2 million and a $2.5 million decrease in one-time separation costs, partially offset by unfavorable logistics costs of $14.5 million. Gross margin as a percentage of Net sales was 28.9% for the three months ended September 30, 2025, an increase of 1.3 percentage points compared to 27.6%for the three months ended September 30, 2024. The increase in Gross margin as a percentage of Net sales was primarily driven by the items noted above.

Current wording

Gross margin was$136.8 million for the three months ended March 31, 2026, an increase of$26.3 million compared to$110.5 million for the three months ended March 31, 2025. The increase in Gross margin was mainly due to incremental margin of $10.9 million recorded by Koch Filter, favorable pricing of $8.3 million as described above, a $6.3 million decrease in one-time costs, favorable impacts of currency of $5.6 million and a $3.0 million decrease in warranty costs, partially offset by unfavorable logistics and duties costs of $6.2 million, unfavorable manufacturing and other costs of $0.8 million and lower volumes of $0.7 million. Gross margin as a percentage of Net sales was 28.6% for the three months ended March 31, 2026, an increase of 2.1 percentage points compared to 26.5%for the three months ended March 31, 2025. The increase in Gross margin as a percentage of Net sales was primarily driven by the items noted above.

Previous wording

Selling, general and administrative expenses were$45.9 million for the three months ended September 30, 2025, a decrease of$0.5 million compared to$46.4 million for the three months ended September 30, 2024. The decrease was primarily driven by lower one-time separation costs of $2.7 million, partially offset by higher consulting expenses. Selling, general and administrative expenses as a percentage of Net sales were 10.3% for the three months ended September 30, 2025, a decrease of 1.2 percentage points compared to 11.5% for the three months ended September 30, 2024. The decrease in Selling, general and administrative expenses as a percentage of Net sales was primarily driven by the items noted above.

Current wording

Selling, general and administrative expenses were$51.0 million for the three months ended March 31, 2026, an increase of$5.1 million compared to$45.9 million for the three months ended March 31, 2025. The increase was primarily driven by higher people-related and consulting expenses and an increase in amortization of internal-use software. Selling, general and administrative expenses as a percentage of Net sales were 10.7% for the three months ended March 31, 2026, a decrease of 0.3 percentage points compared to 11.0% for the three months ended March 31, 2025. The decrease in Selling, general and administrative expenses as a percentage of Net sales was primarily driven by the items noted above increasing at a lower rate in relation to the change in Net sales.

Previous wording

Equity, royalty and interest income from investees was$25.1 million for thenine months ended September 30, 2025, a decrease of$1.6 million compared to$26.7 million for thenine months ended September 30, 2024. The decrease was primarily due to lower earnings of$1.6 million from our joint ventures in India and China.

Current wording

Equity, royalty and interest income from investees was$7.6 million for the three months ended March 31, 2026, a decrease of$1.6 million compared to$9.2 million for the three months ended March 31, 2025. The decrease was primarily due to lower earnings from one of our joint ventures in India. These lower earnings were driven by a remeasurement of benefit obligations in India due to recent labor law changes.

Previous wording

Other (expense) income, net was$(1.7) million for the three months ended September 30, 2025, a decrease of $2.6 million compared to $0.9 million for the three months ended September 30, 2024. The decrease in Other (expense) income, net was due to an increase in the net loss on foreign exchange rate hedging.

Current wording

Other (expense) income, net was$(1.0) million for the three months ended March 31, 2026, a decrease of $1.3 million compared to $0.3 million for the three months ended March 31, 2025. The decrease in Other

Previous wording

Our effective tax rate for the three months ended September 30, 2025 was 23.6%, an increase of 5.2 percentage points compared to 18.4% for the three months ended September 30, 2024. The increase in the effective tax rate was driven by an unfavorable change in the mix of earnings among tax jurisdictions and reductions to U.S. tax incentives and credits due to the adoption of the OBBBA, partially offset by discrete tax items. Our effective tax rate differs from the U.S. statutory rate primarily due to differences in rates applicable to foreign subsidiaries, withholding taxes and state income taxes.

Current wording

Our effective tax rate for the three months ended March 31, 2026 was 20.9%, a decrease of 0.4 percentage points compared to 21.3% for the three months ended March 31, 2025. The variance in the effective tax rate is primarily attributable to higher excess tax benefits on stock compensation due to stock price appreciation and an increase in U.S. tax deductions and foreign tax credits due to the adoption of the One Big Beautiful Bill Act (“OBBBA”), partially offset by unfavorable change in the mix of earnings among tax jurisdictions.

Previous wording

Our facilities under the Credit Agreement provide for $1.0 billion in total availability, which includes a $600 million term loan and a $400 million revolving credit facility. As of September 30, 2025, we have outstanding borrowings of $577.5 million on the term loan and no amount was drawn on the revolving credit facility. As a result, we had capacity under our revolving credit facility of $400 million as of September 30, 2025.

Current wording

On January 7, 2026, we entered into an Amended and Restated Credit Agreement (the “2026 Credit Agreement”). Our facilities under the 2026 Credit Agreement provide for $1.5 billion in total availability, which includes a $1.0 billion term loan and a $500 million revolving credit facility. The term loan facility was drawn on fully for the amount of $1.0 billion with proceeds used to refinance the outstanding term loan facility and finance in part the acquisition of Koch Filter. As of March 31, 2026, we have outstanding borrowings of $1.0 billion on the term loan and no amount was drawn on the revolving credit facility. As a result, we had capacity under our revolving credit facility of $500.0 million as of March 31, 2026.

Previous wording

We believe that cash from operations and the facilities under our Credit Agreement will continue to provide sufficient liquidity for our working capital needs, planned capital expenditures and future payments of our contractual, tax and benefit plan obligations and payments for share repurchases and quarterly dividends in both the short and long term. Overall, we do not expect negative effects to our funding sources that would have a material effect on our liquidity. However, if a serious economic or credit market crisis ensues or other adverse development arises, it could have a material adverse effect on our liquidity, financial condition, results of operations and cash flows.

Current wording

We believe that cash from operations and the facilities under the 2026 Credit Agreement will continue to provide sufficient liquidity for our working capital needs, planned capital expenditures, future payments of our contractual tax and benefit plan obligations and payments for share repurchases and quarterly dividends in both the short and long term. Overall, we do not expect negative effects to our funding sources that would have a material effect on our liquidity. However, if a serious economic or credit market crisis ensues or other adverse development arises, it could have a material adverse effect on our liquidity, financial condition, results of operations and cash flows.

Previous wording

Net cash provided by operating activities was$155.2 million for thenine months ended September 30, 2025, an increase of$69.8 million compared to$85.4 million for thenine months ended September 30, 2024. The increase was driven primarily by lower working capital requirements of$49.7 million and higher net income of $13.9 million. During thenine months ended September 30, 2025, lower working capital requirements resulted in a cash outflow of$32.2 million compared to a cash outflow of$81.9 million for thenine months ended September 30, 2024, mainly due to higher trade payables and other accrued expenses and lower prepaids, partially offset by higher trade receivables.

Current wording

Net cash provided by operating activities was$38.1 million for thethree months ended March 31, 2026, an increase of$9.4 million compared to$28.7 million for thethree months ended March 31, 2025. The increase was driven primarily by a favorable change in other assets of $5.6 million and higher net income adjusted for non-cash items of $4.3 million, partially offset by higher working capital requirements of $1.1 million. During the three months ended March 31, 2026, higher working capital requirements resulted in a cash outflow of$23.2 million compared to a cash outflow of$22.1 million for thethree months ended March 31, 2025. The higher working capital cash outflow for the three months ended March 31, 2026 wasmainly due to lower accounts payable, partially offset by lower trade and other receivables and higher accrued expenses.

Previous wording

Dividends received from our unconsolidated equity investees were$17.8 million and$22.6 million for thenine months ended September 30, 2025 and September 30, 2024, respectively.

Current wording

There were no dividends received from our unconsolidated equity investees for the three months ended March 31, 2026. Dividends received from our unconsolidated equity investees were$5.7 million for thethree months ended March 31, 2025.

Previous wording

Net cash used in investing activities for thenine months ended September 30, 2025 and September 30, 2024 was primarily used for capital expenditures. Our capital expenditures were$37.6 million (of which approximately$9.5 million related to one-time separation capital expenditures) and$38.6 million (of which approximately$12.4 million related to one-time separation capital expenditures) for thenine months ended September 30, 2025 and September 30, 2024, respectively, corresponding to approximately 2.9% and 3.1% of Net sales for thenine months ended September 30, 2025 and September 30, 2024, respectively.

Current wording

Net cash used in investing activities for thethree months ended March 31, 2026 and March 31, 2025 was primarily used for the acquisition of Koch Filter and capital expenditures. Our capital expenditures were$12.6 million for thethree months ended March 31, 2026 and$12.4 million (of which approximately$3.5 million related to one-time separation capital expenditures) for thethree months ended March 31, 2025, corresponding to approximately 2.6% and 3.0% of Net sales for thethree months ended March 31, 2026 and March 31, 2025, respectively.

Previous wording

Net cash used in financing activities for thenine months ended September 30, 2025 was$88.1 million compared to$18.0 millionfor thenine months ended September 30, 2024. Net cash used in financing activities for thenine months ended September 30, 2025 and September 30, 2024 consisted primarily of repurchases of common stock, payments made on our term loan and dividends paid.

Current wording

Net cash provided by (used in) financing activities for thethree months ended March 31, 2026 was$402.6 million compared to$(17.9) millionfor thethree months ended March 31, 2025. Net cash provided by financing activities for thethree months ended March 31, 2026 consisted of net debt proceeds of $995.6 million from our term loan, partially offset by payments made in the refinancing of our previous term loan of $570.0 million, withholding taxes paid on stock-based compensation, repurchases of common stock and dividends paid. Net cash used in financing activity for the three months ended March 31, 2025 consisted primarily of repurchases of common stock, dividends paid and payments made on our term loan.

Previous wording

The third quarter 2025 dividend of $0.055 per share, declared on August 13, 2025 for shareholders of record as of August 26, 2025, was paid on September 10, 2025. The declaration of dividends is subject to the discretion of our Board of Directors and depends on various factors, including our net earnings, financial condition, cash requirements, future prospects and other factors that our Board of Directors deems relevant to its analysis and decision making.

Current wording

We paid dividends of$4.4 million in the first three months of 2026 and$4.1 million in the first three months of 2025. The first quarter 2026 dividend of $0.055 per share, declared on February 9, 2026 for shareholders of record as of February 20, 2026, was paid on March 4, 2026. The declaration of dividends is subject to the discretion of our Board of Directors and depends on various factors, including our net earnings, financial condition, cash requirements, future prospects and other factors that our Board of Directors deems relevant to its analysis and decision making.

Previous wording

Our total debt was$577.5 million at September 30, 2025 and$592.5 million at December 31, 2024. At September 30, 2025, the weighted-average term of our outstanding long-term debt was 1.9 years. Refer to Note 9, Debt and Borrowing Arrangements, to the Condensed Consolidated Financial Statements for more information on our debt and debt covenants.

Current wording

Our total debt was$998.1 million at March 31, 2026 and$570.0 million at December 31, 2025. At March 31, 2026, the weighted-average term of our outstanding long-term debt was 4.8 years. Refer to Note 8, Debt and Borrowing Arrangements, to the Condensed Consolidated Financial Statements for more information on our debt and debt covenants.

Previous wording

•“Adjusted EBITDA” is defined as EBITDA after adding back certain one-time expenses, reflected in Cost of sales and Selling, general and administrative expenses, associated with becoming a standalone public company and “Adjusted EBITDA margin” is defined as Adjusted EBITDA as a percent of Net sales. We believe Adjusted EBITDA and Adjusted EBITDA margin are useful measures of our operating performance as they allow investors and debt holders to compare our performance on a consistent basis without regard to one-time costs attributable to our becoming a standalone public company.

Current wording

•“Adjusted EBITDA” is defined as EBITDA after adding back certain one-time expenses, reflected in Cost of sales and Selling, general and administrative expenses, associated with becoming a standalone public company, transaction costs associated with the Koch Filter acquisition and costs related to the integration of Koch Filter and “Adjusted EBITDA margin” is defined as Adjusted EBITDA as a percent of Net sales. We believe Adjusted EBITDA and Adjusted EBITDA margin are useful measures of our operating performance as they allow investors and debt holders to compare our performance on a consistent basis without regard to one-time costs attributable to our becoming a standalone public company and costs associated with the acquisitions and integration of Koch Filter.

Previous wording

•“Adjusted earnings per share” is defined as diluted earnings per share (the most comparable U.S. GAAP financial measure) after adding back certain one-time expenses, reflected in Cost of sales and Selling, general and administrative expenses, associated with becoming a standalone public company less the related tax impact of the same one-time expenses. We believe Adjusted earnings per share provides improved comparability of underlying operating results.

Current wording

•“Adjusted earnings per share” is defined as diluted earnings per share (the most comparable U.S. GAAP financial measure) after adding back certain one-time expenses, reflected in Cost of sales and Selling, general and administrative expenses, associated with becoming a standalone public company, transaction costs associated with the Koch Filter acquisition, costs related to the integration of Koch Filter and amortization of the intangible assets acquired in the Koch Filter acquisition less the related tax impact of the same one-time expenses, acquisition and integration costs and amortization expense. We believe Adjusted earnings per share provides improved comparability of underlying operating results.

Previous wording

•“Free cash flow” is defined as cash flows provided by (used for) operating activities less capital expenditures and “Adjusted free cash flow” is defined as Free cash flow after adding back certain one-time capital expenditures and other separation related costs associated with becoming a standalone public company. We believe Free cash flow and Adjusted free cash flow are useful metrics used by management and investors to analyze our ability to service and repay debt and return value to shareholders.

Current wording

•“Free cash flow” is defined as cash flows provided by (used in) operating activities less capital expenditures and “Adjusted free cash flow” is defined as Free cash flow after adding back certain one-time items associated with becoming a standalone public company, transaction costs associated with the Koch Filter acquisition and costs related to the integration of Koch Filter. We believe Free cash flow and Adjusted free cash flow are useful metrics used by management and investors to analyze our ability to service and repay debt and return value to shareholders.

Previous wording

(a)Primarily comprised of one-time expenses related to Information Technology, warehousing, manufacturing and Human Resources separation costs.

Current wording

(b)Primarily comprised of one-time expenses related to Information Technology, warehousing, manufacturing and Human Resources separation costs.

Previous wording

(a)Primarily comprised of one-time expenses related to Information Technology, warehousing, manufacturing and Human Resources separation costs and the related tax impact of those expenses. The tax impact of one-time separation costs for the three months ended September 30, 2025 and 2024 were $0.9 million and $1.6 million, respectively, and for the nine months ended September 30, 2025 and 2024 were $3.4 million and $3.8 million, respectively.

Current wording

(b)Primarily comprised of one-time expenses related to Information Technology, warehousing, manufacturing and Human Resources separation costs and the related tax impact of those expenses. The tax impact of one-time separation costs for the three months ended March 31, 2025 were $2.0 million.

Previous wording

We prepare our condensed consolidated financial statements in conformity with U.S. GAAP. The preparation of our financial statements requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from those estimates and assumptions. Our critical accounting policies and estimates, which affect our more significant estimates and assumptions used in preparing our consolidated financial statements, are identified and described inour Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to our critical accounting policies and estimates from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

We prepare our condensed consolidated financial statements in conformity with U.S. GAAP. The preparation of our financial statements requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from those estimates and assumptions. Our critical accounting policies and estimates, which affect our more significant estimates and assumptions used in preparing our consolidated financial statements, are identified and described inour Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to our critical accounting policies and estimates from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, except for the addition of the accounting policies set forth below.