What changed in this filing

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Item 1. Financial Statements

2025-11-06 compared with 2025-07-30 · 213 added, 223 removed, 646 unchanged (40% of the section changed)

1 unchanged sentence

ALBANY INTERNATIONAL CORP.

CONSOLIDATED STATEMENTS OF INCOME

CONSOLIDATED STATEMENTS OF INCOME/(LOSS)

(in thousands, except per share amounts)

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

1 unchanged sentence

Cost of goods sold 311,372 208,002 717,552 632,257

Gross profit 97,507 112,383 193,993 221,069

Gross profit/(loss) ( 49,938 ) 90,384 144,055 311,453

Selling, general, and administrative expenses 51,905 52,097 164,219 162,447

1 unchanged sentence

Restructuring expenses, net 3,197 2,272 9,895 6,584

Operating income 22,270 42,905 50,533 81,882

Operating income/(loss) ( 116,507 ) 25,171 ( 65,974 ) 107,053

Interest expense/(income), net 5,897 2,411 14,702 8,680

Other expense/(income), net ( 347 ) 3,257 4,170 5,932

Income before income taxes 13,586 34,298 37,211 72,938

Income tax expense 4,254 9,578 10,530 20,849

Net income 9,332 24,720 26,681 52,089

Net income attributable to the noncontrolling interest 149 96 143 174

Net income attributable to the Company $ 9,183 $ 24,624 $ 26,538 $ 51,915

Income (loss) before income taxes ( 122,057 ) 19,503 ( 84,846 ) 92,441

Income tax expense/(benefit) ( 24,419 ) 1,282 ( 13,889 ) 22,131

Net income/(loss) ( 97,638 ) 18,221 ( 70,957 ) 70,310

Net income/(loss) attributable to the noncontrolling interest 122 192 265 366

Net income/(loss) attributable to the Company $ ( 97,760 ) $ 18,029 $ ( 71,222 ) $ 69,944

Earnings per share attributable to Company shareholders - Basic $ ( 3.37 ) $ 0.58 $ ( 2.38 ) $ 2.24

9 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Net income $ 9,332 $ 24,720 $ 26,681 $ 52,089

Net income/(loss) $ ( 97,638 ) $ 18,221 $ ( 70,957 ) $ 70,310

Other comprehensive income/(loss), before tax:

12 unchanged sentences

Derivative valuation adjustment ( 7 ) 305 67 ( 97 )

Comprehensive income 47,191 4,839 78,379 18,350

Comprehensive income attributable to the noncontrolling interest 304 ( 270 ) 88 ( 146 )

Comprehensive income attributable to the Company $ 46,887 $ 5,109 $ 78,291 $ 18,496

Comprehensive income/(loss) ( 94,645 ) 31,579 ( 16,266 ) 49,929

Comprehensive income/(loss) attributable to the noncontrolling interest 212 ( 127 ) 300 ( 273 )

Comprehensive income/(loss) attributable to the Company $ ( 94,857 ) $ 31,706 $ ( 16,566 ) $ 50,202

The accompanying notes are an integral part of the consolidated financial statements

2 unchanged sentences

(in thousands, except share and per share data)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Cash and cash equivalents $ 108,310 $ 115,283

14 unchanged sentences

Accrued liabilities 222,434 141,904

Current maturities of long-term debt — —

Income taxes payable 7,964 18,367

28 unchanged sentences

(in thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

Net income $ 26,681 $ 52,089

Adjustments to reconcile net income to net cash provided by operating activities:

Net income/(loss) $ ( 70,957 ) $ 70,310

Adjustments to reconcile net income/(loss) to net cash provided by operating activities:

Depreciation 61,577 61,813

3 unchanged sentences

Non-cash interest expense 777 769

Contract loss provision 139,665 —

Compensation and benefits paid or payable in Class A Common Stock 9,882 4,438

12 unchanged sentences

Income taxes payable ( 13,022 ) ( 11,995 )

Noncurrent receivables ( 201 ) ( 379 )

Other noncurrent liabilities ( 4,307 ) ( 17 )

8 unchanged sentences

Proceeds from borrowings 231,999 48,106

Principal payments on debt ( 58,046 ) ( 122,828 )

Repayment of borrowings ( 82,044 ) ( 142,691 )

Purchase of Treasury shares ( 170,964 ) —

21 unchanged sentences

Recent Accounting Pronouncements

In December 2023, the FASB issued Accounting Standards Update No.

2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures” (“ASU 2023-09”), which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign).

ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes.

The guidance is effective for annual periods beginning after December 15, 2024.

ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted.

We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures.

In March 2024, the FASB issued Accounting Standards Update No.

2024-01, "Compensation - Stock Compensation (Topic 718):

Scope Application of Profits Interest and Similar Awards" (ASU 2024-01), which clarifies how an entity determines whether profits interest or similar awards should be considered within the scope of ASC 718 as a share-based payment arrangement or under ASC 710 or other ASC topics in a manner similar to a cash bonus or profit-sharing arrangement.

The guidance is effective for annual periods beginning after December 15, 2024, and interim periods beginning within those annual periods.

Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance.

ASU 2024-01 should be applied either (1) retrospectively to all prior periods presented in the financial statements or (2) prospectively to profits interest and similar awards granted or modified on or after the date at which the entity first applies the amendments.

The adoption of this standard on January 1, 2025 did not have any impact on our consolidated financial statements and related disclosures.

In November 2024, the FASB issued Accounting Standards Update No.

2024-03, "Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses" (ASU 2024-03), which requires a public business entity to disclose specific information about certain costs and expenses in the notes to the financial statements for interim and annual reporting periods.

The objective of the disclosure requirements is to provide disaggregated information of the public entity's expenses to help investors better understand the entity's performance;

better assess the entity's prospects for future cash flows;

and compare an entity's performance over time and with that of other entities.

The disaggregation of relevant expense

captions presented on the face of the income statement may include but is not limited to the following natural expenses:

(1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion, and amortization.

The guidance is effective for annual periods beginning after December 15, 2026, and for interim periods beginning after December 15, 2027.

Early adoption is permitted.

We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures.

In March 2024, the U.S.

Securities and Exchange Commission ("SEC") adopted the final rule under SEC Release No.

33-11275, "The Enhancement and Standardization of Climate-Related Disclosures for Investors" .

This rule would require registrants to disclose certain climate-related information in registration statements and annual reports.

In April 2024, the SEC voluntarily stayed the final rule as a result of legal challenges that are pending judicial review.

The disclosure requirements would apply to the Company's fiscal year beginning January 1, 2025, pending resolution of the stay.

While there has been no resolution of the stay, the Company is currently evaluating the final rule to determine its impact on the Company's disclosures.

In September 2025, the Financial Accounting Standards Board (FASB) issued guidance to improve the accounting for costs related to internal-use software.

The new guidance eliminates project stages and requires capitalizing software costs to begin when (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended.

Additionally, disclosures for property, plant and equipment will be required for all capitalized software costs.

The guidance is effective in the first quarter of 2028 with early adoption permitted as of the beginning of an annual reporting period.

Upon adoption, the guidance may be applied prospectively, retrospectively or using a modified transition approach.

We are evaluating the impact of this guidance on our consolidated financial statements.

In November 2024, the FASB issued guidance to improve the disclosure of expenses in commonly presented expense captions.

The new guidance requires a public entity to provide tabular disclosure, on an annual and interim basis, of amounts for the following expense categories:

(1) purchases of inventory, (2) employee compensation, (3) depreciation and (4) intangible asset amortization, as included in each relevant expense caption.

Additionally, on an annual and interim basis, a qualitative description is required for amounts remaining in relevant expense captions that are not separately disaggregated quantitatively.

A relevant expense caption is an expense caption presented on the face of the income statement that contains any of the expense categories noted.

The guidance also requires certain amounts that are currently required to be disclosed to be included in the same tabular disclosure as these disaggregation requirements.

Furthermore, on an annual and interim basis, a public entity is required to separately disclose selling expenses and annually, disclose a description of the selling expenses.

The guidance is effective for 2027 annual reporting, and in the first quarter of 2028 for interim reporting, with early adoption permitted, to be applied on a prospective basis, with retrospective application permitted.

We are evaluating the impact of this guidance on our consolidated financial statements.

In December 2023, the FASB issued guidance to enhance transparency of income tax disclosures.

On an annual basis, the new guidance requires a public entity to disclose:

(1) specific categories in the rate reconciliation, (2) additional information for reconciling items that are equal to or greater than 5% of the amount computed by multiplying income (or loss) from continuing operations before income tax expense (or benefit) by the applicable statutory income tax rate, (3) income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes, with foreign taxes disaggregated by individual jurisdictions in which income taxes paid is equal to or greater than 5% of total income taxes paid, (4) income (or loss) from continuing operations before income tax expense (or benefit)

disaggregated between domestic and foreign, and (5) income tax expense (or benefit) from continuing operations disaggregated between federal (national), state and foreign.

The guidance is effective for fiscal year 2025 annual reporting, with early adoption permitted, to be applied on a prospective basis, with retrospective application permitted.

Reportable Segments

2 unchanged sentences

Our CODM evaluates each segment's performance based on metrics such as net revenues, gross profit, and other key financial data, to assess performance and allocate resources that align with company-wide goals.

Annual incentive targets are established for the segment presidents based on these metrics, in addition to cash flows, which are reviewed in summary each month, and in more depth each quarter.

The Company has not aggregated operating segments for purposes of identifying reportable segments.

10 unchanged sentences

AEC, through ASC, is the exclusive supplier to the LEAP program of advanced composite fan blades and fan cases under a long-term supply contract, where revenue is determined by a cost-plus-fee agreement.

The LEAP engine is used on the Airbus A320neo, A321neo , Boeing 737 MAX, and COMAC 919 aircraft.

AEC's largest aerospace customer is the SAFRAN Group and sales to SAFRAN (consisting primarily of fan blades and cases for CFM International's LEAP engine).

AEC net sales to SAFRAN were $ 44.4 million and $ 51.2 million for the three months ended June 30, 2025 and 2024, respectively and $ 83.8 million and $ 101.3 million in the first six months of 2025 and 2024, respectively.

The total of Accounts receivable, Contract assets and Noncurrent receivables due from SAFRAN amounted to $ 67.5 million and $ 85.8 million as of June 30, 2025 and December 31, 2024, respectively.

Other significant programs for AEC include the Sikorsky CH-53K, F-35, JASSM, and Boeing 787 programs.

4 unchanged sentences

Reconciliation of Net Revenues to Operating Income(loss):

Three Months Ended June 30, 2025

Three Months Ended September 30, 2025

(in thousands) MC AEC Corporate Total

6 unchanged sentences

Operating income/(loss) $ 43,103 $ ( 148,012 ) $ ( 11,598 ) $ ( 116,507 )

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(in thousands) MC AEC Corporate Total

6 unchanged sentences

Operating income/(loss) $ 47,624 $ ( 14,296 ) $ ( 8,157 ) $ 25,171

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

(in thousands) MC AEC Corporate Total

6 unchanged sentences

Operating income/(loss) $ 119,236 $ ( 149,070 ) $ ( 36,140 ) $ ( 65,974 )

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(in thousands) MC AEC Corporate Total

7 unchanged sentences

Schedule of Depreciation and Amortization Expenses:

Three months ended June 30, Six months ended June 30,

Three months ended September 30, Nine months ended September 30,

(in thousands)

5 unchanged sentences

Consolidated depreciation and amortization $ 22,438 $ 22,310 $ 65,480 $ 67,003

Reconciliation of Operating Income to Income before income taxes:

Three months ended June 30, Six months ended June 30,

Reconciliation of Operating Income/(loss) to Income before income taxes:

Three months ended September 30, Nine months ended September 30,

(in thousands)

2025 2024 2025 2024

Operating income

Operating income/(loss)

Machine Clothing $ 43,103 $ 47,624 $ 119,236 $ 141,705

1 unchanged sentence

Corporate ( 11,598 ) ( 8,157 ) ( 36,140 ) ( 30,960 )

Consolidated Operating income $ 22,270 $ 42,905 $ 50,533 $ 81,882

Consolidated Operating income/(loss) $ ( 116,507 ) $ 25,171 $ ( 65,974 ) $ 107,053

Reconciling items:

Interest income ( 1,405 ) ( 959 ) ( 3,043 ) ( 2,082 )

Interest income/(loss) ( 1,114 ) ( 1,019 ) ( 4,157 ) ( 3,101 )

Interest expense

1 unchanged sentence

Other (income)/expense, net ( 347 ) 3,257 4,170 5,932

Income before income taxes $ 13,586 $ 34,298 $ 37,211 $ 72,938

Income/(loss) before income taxes $ ( 122,057 ) $ 19,503 $ ( 84,846 ) $ 92,441

Certain prior year amounts have been reclassified in order to conform to current year presentation.

1 unchanged sentence

Management believes this presentation better reflects the performance of the segments and is how management will review segment performance on a going forward basis.

F or the three months ended June 30, 2025, Selling, general and administrative expenses include global information system costs of $ 3.9 million, $ 3.8 million, and $ 0.9 million for MC, AEC and Corporate, respectively.

For the three months ended June 30, 2024, Selling, general and administrative expenses include global information system costs of $ 3.9 million, $ 4.0 million, and $ 0.2 million for MC, AEC and Corporate, respectively.

F or the six months ended June 30, 2025, Selling, general and administrative expenses include global information system costs of $ 7.9 million, $ 7.7 million, and $ 1.3 million for MC, AEC and Corporate, respectively.

For the six months ended June 30, 2024, Selling, general and administrative expenses include global information system costs of $ 7.7 million, $ 8.0 million, and $ 0.6 million for MC, AEC and Corporate, respectively.

F or the three months ended September 30, 2025, Selling, general and administrative expenses include global information system costs of $ 4.9 million and $ 5.2 million for MC and AEC, respectively.

For the three months ended September 30, 2024, Selling, general and administrative expenses include global information system costs of $ 3.9 million and $ 4.0 million for MC and AEC, respectively.

F or the nine months ended September 30, 2025, Selling, general and administrative expenses include global information system costs of $ 12.8 million and $ 13.0 million for MC and AEC, respectively.

For the nine months ended September 30, 2024, Selling, general and administrative expenses include global information system costs of $ 11.6 million and $ 12.0 million for MC and AEC, respectively.

The following table presents assets by reportable segment:

(in thousands)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Segment assets

7 unchanged sentences

The following table presents capital expenditures by reportable segment:

Six months ended June 30,

Nine months ended September 30,

(in thousands)

7 unchanged sentences

When adjustments in estimated contract revenues or costs are required, any changes from prior estimates are included in earnings in the period the change occurs.

Changes in the estimated profitability of long-term contracts could be caused by increases or decreases in the contract value, revisions to customer delivery requirements, updated labor or overhead rates, material costs, factors affecting the supply chain, changes in the evaluation of contract risks and opportunities, or other factors.

The cumulative changes in the estimated profitability of long-term contracts decreased operating income by $ 7.2 million during the second quarter of 2025 and $ 14.2 million for the first six months of 2025.

The negative cumulative change in profitability during the second quarter of 2025 was primarily driven by a few large complex programs, including $ 8.1 million for various CH-53K programs, $ 0.8 million on our F-35 program, offset by a gain of $ 1.6 million on our Gulfstream program and a $ 0.1 million, net gain on all other programs.

The negative cumulative change in profitability during the six months ended June 2025 was driven by $ 10.1 million for various CH-53K programs, $ 2.1 million on our F-35 program, and $ 2.0 million, net on all other programs.

Adjustments in the estimated profitability of long-term contracts decreased operating income by $ 5.0 million during the second quarter of 2024 and $ 7.6 million for the first six months of 2024.

The LEAP engine is used on the Airbus A320neo, A321neo, Boeing 737 MAX, and COMAC 919 aircraft.

AEC's largest aerospace customer is the SAFRAN Group and sales to SAFRAN (consisting primarily of fan blades and cases for CFM International's LEAP engine) were $ 46.4 million and $ 40.9 million for the three months ended September 30, 2025 and 2024, respectively and $ 130.2 million and $ 142.2 million in the first nine months of 2025 and 2024, respectively.

The total of Accounts receivable, Contract assets and Noncurrent receivables due from SAFRAN amounted to $ 67.6 million and $ 78.5 million as of September 30, 2025 and December 31, 2024, respectively.

Changes in the estimated profitability of long-term contracts could be caused by increases or decreases in the contract value, revisions to customer delivery requirements, updated labor or overhead projections, material costs, factors affecting the supply chain, changes in the evaluation of contract risks and opportunities, or other factors.

The cumulative changes in the estimated profitability of long-term contracts decreased revenue by $ 49.1 million and operating income by $ 150.9 million during the third quarter of 2025.

Adjustments to the estimated profitability of long-term contracts decreased revenue by $ 67.6 million and operating income by $ 165.1 million for the first nine months of 2025.

The decrease in profitability during the third quarter of 2025 was primarily driven by a few large complex programs, including adjustments of $ 147.3 million for various CH-53K programs, based on changes to material input costs, labor hours, and future overhead rates over the remainder of the contract.

Additionally, we recorded negative cumulative changes in profitability of $ 0.2 million on our F-35 program, $ 0.9 million on our Gulfstream program and $ 2.6 million, net on all other programs.

The negative cumulative change in profitability during the nine months ended September 30, 2025 was driven by $ 157.4 million for various CH-53K programs, $ 2.3 million on our F-35 program, and $ 5.5 million, net on all other programs.

Adjustments in the estimated profitability of long-term contracts decreased operating income by $ 22.4 million during the third quarter of 2024 and $ 28.3 million for the first nine months of 2024.

We disaggregate revenue earned from contracts with customers for each of our business segments and product groups based on the timing of revenue recognition, and groupings used for internal review purposes.

The following table disaggregates revenue for each product group by timing of revenue recognition for the three months ended June 30, 2025:

Three months ended June 30, 2025

The following table disaggregates revenue for each product group by timing of revenue recognition for the three months ended September 30, 2025:

Three months ended September 30, 2025

(in thousands)

8 unchanged sentences

Total revenues $ 177,013 $ 84,421 $ 261,434

The following table disaggregates revenue for each product group by timing of revenue recognition for the three months ended June 30, 2024:

Three months ended June 30, 2024

The following table disaggregates revenue for each product group by timing of revenue recognition for the three months ended September 30, 2024:

Three months ended September 30, 2024

(in thousands)

8 unchanged sentences

Total revenues $ 186,192 $ 112,194 $ 298,386

The following table disaggregates revenue for each product group by timing of revenue recognition for the six months ended June 30, 2025

Six months ended June 30, 2025

The following table disaggregates revenue for each product group by timing of revenue recognition for the nine months ended September 30, 2025

Nine months ended September 30, 2025

(in thousands)

8 unchanged sentences

Total revenues $ 537,730 $ 323,877 $ 861,607

The following table disaggregates revenue for each product group by timing of revenue recognition for the six months ended June 30, 2024

Six months ended June 30, 2024

The following table disaggregates revenue for each product group by timing of revenue recognition for the nine months ended September 30, 2024

Nine months ended September 30, 2024

(in thousands) Point in Time Revenue

9 unchanged sentences

and for PMC, the geographical region to which the paper machine clothing was sold:

Three months ended June 30, Six months ended June 30,

Three months ended September 30, Nine months ended September 30,

(in thousands)

6 unchanged sentences

Contracts in the MC segment are generally for periods of less than a year and certain contracts in the AEC segment are relatively short duration firm-fixed-price orders.

Remaining performance obligations on contracts that had an original duration of greater than one year totaled $ 1.0 billion and $ 1.1 billion as of June 30, 2025 and 2024, respectively, and related primarily to firm fixed price contracts in the AEC segment.

Of the remaining performance obligations as of June 30, 2025, we expect to recognize as revenue approximately $ 84.6 million during 2025, $ 153.7 million during 2026, $ 142.1 million during 2027, and the remainder thereafter.

Remaining performance obligations on contracts that had an original duration of greater than one year totaled $ 1.1 billion and $ 1.1 billion as of September 30, 2025 and 2024, respectively, and related primarily to firm fixed price contracts in the AEC segment.

Of the remaining performance obligations as of September 30, 2025, we expect to recognize as revenue approximately $ 51.0 million during 2025, $ 182.1 million during 2026, $ 165.5 million during 2027, and the remainder thereafter.

Pensions and Other Postretirement Benefit Plans

2 unchanged sentences

The Company accrues the cost of providing these benefits during the active service period of the employees.

The composition of the net periodic benefit cost/(income) for the six months ended June 30, 2025 and 2024, was as follows:

The composition of the net periodic benefit cost/(income) for the nine months ended September 30, 2025 and 2024, was as follows:

Pension plans

16 unchanged sentences

The amount of net benefit cost/(credit) is determined at the beginning of each year and generally only varies from quarter to quarter when a significant event occurs, such as a curtailment or a settlement.

In the first six months of 2025, we took action to settle certain pension plan liabilities related to an MC pension plan in Switzerland.

This resulted in a net gain totaling $ 1.6 million related to curtailments and settlements.

There were no material curtailments or settlements during the six months ended June 30, 2024.

In the first nine months of 2025, we took action to settle certain pension plan liabilities related to an MC pension plan in Switzerland, resulting in a net gain totaling $ 1.6 million related to curtailments and settlements.

There were no material curtailments or settlements during the nine months ended September 30, 2024.

Service cost for defined benefit pension and postretirement plans are reported in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period.

2 unchanged sentences

At MC, restructuring actions were taken in 2025 and 2024 to cease operations at five facilities.

For the three month ended June 30, 2025, these actions related to workforce reductions of $ 3.0 million.

For the three month ended June 30, 2024, these actions related to workforce reductions and inventory write-off costs totaling $ 1.1 million.

For the six month ended June 30, 2025, these actions related to workforce reductions, fixed asset impairments and related costs and inventory write-off costs of $ 6.1 million offset by a $ 1.8 million pension curtailment gain, For the six month ended June 30, 2024 these actions related to workforce reductions and write-off of inventory of $ 1.1 million.

At AEC, restructuring activities were related to reorganizational and workforce reduction costs, which resulted in restructuring expenses of $ 0.5 million for the three months ended June 30, 2025 and $ 0.9 million for the three months ended June 30, 2024.

For the six months ended June 30, 2025 and June 30, 2024, restructuring expenses were related to reductions in workforce and totaled $ 1.7 million and $ 3.1 million, respectively.

For the three months ended September 30, 2025, these actions related to workforce reductions of $ 2.0 million.

For the three month ended September 30, 2024, these actions related to workforce reductions and inventory write-off costs totaling $ 2.2 million.

For the nine months ended September 30, 2025, these actions related to workforce reductions, fixed asset impairments and related costs and inventory write-off costs of $ 8.1 million offset by a $ 1.8 million pension curtailment

For the nine months ended September 30, 2024 these actions related to workforce reductions of $ 3.3 million, as well as charges of $ 1.3 million in costs of goods sold for the write-off of inventory.

At AEC, restructuring activities were related to reorganizational and workforce reduction costs, which resulted in restructuring expenses of $ 0.1 million for the three months ended September 30, 2025 and $ 0.0 million for the three months ended September 30, 2024.

For the nine months ended September 30, 2025 and September 30, 2024, restructuring expenses were related to reductions in workforce and totaled $ 1.8 million and $ 3.1 million, respectively.

The following table summarizes charges reported in the Consolidated Statements of Income under "Restructuring expenses, net":

Three months ended June 30,

Six months ended June 30,

Three months ended September 30,

Nine months ended September 30,

(in thousands) 2025 2024 2025 2024

4 unchanged sentences

The following tables summarize charges by type of expense reported in the Consolidated Statements of Income under "Restructuring expenses, net" and "Cost of goods sold":

Six months ended June 30, 2025 Total

Nine months ended September 30, 2025 Total

restructuring

6 unchanged sentences

Total $ 9,895 $ 10,932 $ 723 $ ( 1,760 )

Six months ended June 30, 2024 Total

Nine months ended September 30, 2024 Total

restructuring

8 unchanged sentences

(in thousands) December 31, 2024 Restructuring

charges accrued Payments and other June 30, 2025

Total termination and other costs $ 4,996 $ 7,735 $ ( 8,185 ) $ 4,546

charges accrued Payments and other September 30, 2025

Total restructuring and other liabilities $ 4,996 $ 10,932 $ ( 12,622 ) $ 3,306

(in thousands) December 31, 2023 Restructuring

charges accrued Payments and other June 30, 2024

Total termination and other costs $ — $ 4,312 $ ( 1,388 ) $ 2,924

charges accrued Payments and other September 30, 2024

Total restructuring and other liabilities $ — $ 7,871 $ ( 3,974 ) $ 3,897

Other (Income)/Expense, net

The components of Other (income)/expense, net are:

Three months ended June 30, Six months ended June 30,

Three months ended September 30, Nine months ended September 30,

(in thousands)

4 unchanged sentences

Components of net periodic pension and postretirement cost other than service cost 1,011 663 1,334 1,995

Other ( 887 ) 452 ( 1,351 ) ( 1,788 )

Other losses/(gains) ( 209 ) 1,245 ( 1,558 ) ( 543 )

Total other (income)/expense, net $ ( 347 ) $ 3,257 $ 4,170 $ 5,932

Other (income)/expense, net, included foreign currency related transactions which resulted in losses of $ 5.7 million and $ 8.8 million in the three and six months ended June 30, 2025, as compared to losses of $ 0.2 million and gains of $ 1.1 million in the same periods last year.

These changes were the result of unrealized losses on intercompany loans.

In addition, changes in the fair value of derivative instruments included gains of $ 0.7 million and $ 3.3 million in the three and six months ended June 30, 2025, as compared to losses of $ 4.4 million and $ 4.3 million for the three and six months ended June 30, 2024, driven by currency rate movements, most notably the Brazilian Real and Mexican Peso.

Other also included net gains of $ 1.6 million from the divestiture of Arcari during the three and six months ended June 30, 2025, offset by amortization of debt issuance costs and other non-operating expenses.

The Company's effective income tax rate for the three and six months ended June 30, 2025 and 2024, is as follows:

Three months ended June 30, Six months ended June 30,

Currency transaction losses/(gains), included within other (income)/expense, net were primarily the result of both realized and unrealized losses/(gains) on intercompany loans.

In addition, changes in the fair value of derivative instruments included gains driven by currency rate movements, most notably the Brazilian Real and Mexican Peso.

The Company divested its Arcari business during the quarter ended June 30, 2025, resulting in a net gain of $ 1.6 million, which is included within other (income)/expense, net for the nine months ended September 30, 2025.

The Company's effective income tax rate for the three and nine months ended September 30, 2025 and 2024, is as follows:

Three months ended September 30, Nine months ended September 30,

2025 2024 2025 2024

1 unchanged sentence

Income tax expense for the quarter was computed in accordance with ASC 740-270, Income Taxes – Interim Reporting.

Under this method, loss jurisdictions which cannot recognize a tax benefit with regard to their generated losses are excluded from the annual effective tax rate calculation and their taxes will be recorded discretely in each quarter.

Under this method, loss jurisdictions subject to valuation allowances cannot recognize a tax benefit with regard to their generated losses and are excluded from the annual effective tax rate calculation as their taxes will be recorded discretely in each quarter.

Our 2025 estimated annual effective tax rate primarily reflects the 21% federal tax rate, the impact of state and local taxation, the impact of taxation upon foreign operations, and forecasted permanent differences.

Our actual effective tax rates were 31.3 % and 27.9 % for the three months ended June 30, 2025 and 2024, respectively.

Our actual effective tax rates were 28.3 % and 28.6 % for the six months ended June 30, 2025 and 2024, respectively.

The effective tax rate for the three months ended June 30, 2025 included a net discrete tax benefit o f $ 0.3 million.

Our actual effective tax rates were 20.0 % and 6.6 % for the three months ended September 30, 2025 and 2024, respectively.

Our actual effective tax rates were 16.4 % and 23.9 % for the nine months ended September 30, 2025 and 2024, respectively.

The effective tax rate for the three months ended September 30, 2025 included a net discrete tax benefit o f $ 0.7 million.

This discrete tax benefit is mostly attributable to the true-up for prior year's estimated taxes.

The rate for the three months ended June 30, 2025 was higher than the three months ended June 30, 2024 mainly due to a significant favorable discrete tax adjustment in the quarter ended June 30, 2024 related to the release of uncertain tax positions as compared to the current period.

The effective tax rate for the six months ended June 30, 2025 included a net discrete tax benefit of $ 1.6 million.

This discrete tax benefit is mostly attributable to the true-up for prior year's estimated taxes, a net decrease in valuation allowances and a net decrease in uncertain tax positions.

The rate for the six months ended June 30, 2025 was lower than the six months ended June 30, 2024 mainly due to the favorable discrete tax adjustment related to a decrease in valuation allowance in the current period.

The rate for the three months ended September 30, 2025 was higher than the three months ended September 30, 2024 mainly due to a significant favorable discrete tax adjustment in the quarter ended September 30, 2024 related to the decrease in the valuation allowance as compared to the current period.

The effective tax rate for the nine months ended September 30, 2025 included a net discrete tax benefit of $ 2.3 million .

The discrete tax benefit recognized primarily reflects adjustments to prior year estimated tax provisions to actual filings, a net reduction in valuation allowances, and a net decrease in uncertain tax positions.

The effective rate for the nine months ended September 30, 2025 was lower than the nine months ended September 30, 2024, largely due to the favorable impact of discrete tax items, including the release of valuation allowances in the current period.

The Company is subject to audit in the U.S.

6 unchanged sentences

The amounts used in computing earnings per share and the weighted average number of shares of potentially dilutive securities are as follows:

Three months ended June 30, Six months ended June 30,

Three months ended September 30, Nine months ended September 30,

(in thousands, except earnings per share) 2025 2024 2025 2024

Net income attributable to the Company $ 9,183 $ 24,624 $ 26,538 $ 51,915

Net income/(loss) attributable to the Company $ ( 97,760 ) $ 18,029 $ ( 71,222 ) $ 69,944

Weighted average number of shares:

Weighted average number of shares used in calculating basic net income per share

29,928 31,242 30,373 31,225

Weighted average number of shares used in calculating basic net income/(loss) per share 29,012 31,251 29,914 31,234

Effect of dilutive stock-based compensation plans:

Restricted stock units and multi-year awards — 116 — 99

Weighted average number of shares used in calculating diluted net income per share 30,090 31,342 30,535 31,316

Net income attributable to the Company per share:

Basic $ 0.31 $ 0.79 $ 0.87 $ 1.66

Diluted $ 0.31 $ 0.79 $ 0.87 $ 1.66

Weighted average number of shares used in calculating diluted net income/(loss) per share 29,012 31,367 29,914 31,333

For the three and nine months ended September 30, 2025, basic and diluted shares outstanding are equal as a result of the Company's net loss and potentially dilutive shares being anti-dilutive.

Accumulated Other Comprehensive Income ("AOCI")

The table below presents changes in the components of AOCI for the period from December 31, 2024 to June 30, 2025:

The table below presents changes in the components of AOCI for the period from December 31, 2024 to September 30, 2025:

(in thousands)

2 unchanged sentences

Comprehensive

Income/(Loss)

December 31, 2024 $ ( 181,555 ) $ ( 14,328 ) $ ( 106 ) $ ( 195,989 )

3 unchanged sentences

— ( 1,178 ) — ( 1,178 )

Interest (expense)/income related to swaps reclassified to the Consolidated Statements of Income, net of tax — — ( 237 ) ( 237 )

Pension and postretirement liability adjustments reclassified to Consolidated Statements of Income, net of tax

Net current period other comprehensive income 55,971 ( 3,517 ) ( 757 ) 51,697

June 30, 2025 $ ( 125,584 ) $ ( 17,845 ) $ ( 863 ) $ ( 144,292 )

The table below presents changes in the components of AOCI for the period from December 31, 2023 to June 30, 2024:

Interest (expense)/income related to swaps reclassified to the Consolidated Statements of Income/(Loss), net of tax — — ( 273 ) ( 273 )

Pension and postretirement liability adjustments reclassified to Consolidated Statements of Income/(Loss), net of tax — 552 — 552

Net current period other comprehensive income/(loss) 58,366 ( 3,044 ) ( 631 ) 54,691

September 30, 2025 $ ( 123,189 ) $ ( 17,372 ) $ ( 737 ) $ ( 141,298 )

The table below presents changes in the components of AOCI for the period from December 31, 2023 to September 30, 2024:

(in thousands) Translation

2 unchanged sentences

Comprehensive

Income/(Loss)

December 31, 2023 $ ( 124,901 ) $ ( 17,346 ) $ 9,079 $ ( 133,168 )

1 unchanged sentence

( 12,472 ) ( 285 ) 298 ( 12,459 )

Interest (expense)/income related to swaps reclassified to the Consolidated Statements of Income, net of tax — — ( 6,195 ) ( 6,195 )

Pension and postretirement liability adjustments reclassified to Consolidated Statements of Income, net of tax — 193 — 193

Net current period other comprehensive income ( 29,403 ) 628 ( 4,964 ) ( 33,739 )

June 30, 2024 $ ( 154,304 ) $ ( 16,718 ) $ 4,115 $ ( 166,907 )

The components of AOCI that are reclassified to the Consolidated Statements of Income relate to our pension and postretirement plans and interest rate swaps.

The table below presents the expense/(income) amounts reclassified from AOCI, and the line items of the Consolidated Statements of Income that were affected for the three and six months ended June 30, 2025 and 2024:

Three months ended June 30, Six months ended June 30,

Interest (expense)/income related to swaps reclassified to the Consolidated Statements of Income/(Loss), net of tax — — ( 8,212 ) ( 8,212 )

Pension and postretirement liability adjustments reclassified to Consolidated Statements of Income/(Loss), net of tax — 290 — 290

Net current period other comprehensive income/(loss) ( 12,472 ) 5 ( 7,914 ) ( 20,381 )

September 30, 2024 $ ( 137,373 ) $ ( 17,341 ) $ 1,165 $ ( 153,549 )

The components of AOCI that are reclassified to the Consolidated Statements of Income/(Loss) relate to our pension and postretirement plans and interest rate swaps.

The table below presents the expense/(income) amounts reclassified from AOCI, and the line items of the Consolidated Statements of Income/(Loss) that were affected for the three and nine months ended September 30, 2025, and the Consolidated Statements of Income/(Loss) for the three and nine months ended September 30, 2024:

Three months ended September 30, Nine months ended September 30,

(in thousands)

2025 2024 2025 2024

Pre-tax Derivative valuation reclassified from Accumulated Other Comprehensive Income:

Interest (income)/expense, net related to interest rate swaps included in Income before taxes

$ ( 79 ) $ ( 4,180 ) $ ( 271 ) $ ( 8,218 )

Pre-tax Derivative valuation reclassified from Accumulated Other Comprehensive Income/(Loss):

Interest (income)/expense, net related to interest rate swaps included in Income/(loss) before taxes $ ( 53 ) $ ( 2,675 ) $ ( 324 ) $ ( 10,893 )

Income tax effect 17 658 51 2,681

Effect on net income due to items reclassified from Accumulated Other Comprehensive Income

$ ( 59 ) $ ( 3,179 ) $ ( 237 ) $ ( 6,195 )

Effect on net income due to items reclassified from Accumulated Other Comprehensive Income/(Loss) $ ( 36 ) $ ( 2,017 ) $ ( 273 ) $ ( 8,212 )

Pre-tax pension and postretirement liabilities reclassified from Accumulated Other Comprehensive Income:

4 unchanged sentences

315 176 908 530

Total pre-tax amount reclassified (a)

( 2,931 ) 138 ( 1,081 ) 278

Total pre-tax amount reclassified 277 139 ( 804 ) 417

Income tax effect ( 86 ) ( 42 ) 178 ( 127 )

Effect on net income due to items reclassified from Accumulated Other Comprehensive Income $ 191 $ 97 $ ( 626 ) $ 290

(a) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 4.

Pensions and Other Postretirement Benefit Plans ).

Noncontrolling Interests

5 unchanged sentences

On April 1, 2025, Heimbach sold its 85 % controlling interest in Arcari to the minority shareholder and recorded a gain of $ 1.6 million included in Other (Income) expense on the sale.

In connection with the sale, the corresponding value of

the non-controlling interest was reduced to zero .

The Company did not retain any ownership in Arcari as a result of the sale and accordingly there was no impact on operating results during the second quarter of 2025.

In connection with the sale, the corresponding value of the non-controlling interest was reduced to zero .

The Company did not retain any ownership in Arcari as a result of the sale and accordingly there was no impact on operating results during the third quarter of 2025.

The table below presents a reconciliation of income attributable to the noncontrolling interest and noncontrolling equity in the Company’s subsidiaries:

ASC Noncontrolling Interest Six months ended June 30,

ASC Noncontrolling Interest Nine months ended September 30,

(in thousands, except percentages) 2025 2024

15 unchanged sentences

The notes may be presented for payment at maturity, which is less than one year.

As of June 30, 2025 and December 31, 2024, Accounts receivable consisted of the following:

(in thousands) June 30, 2025 December 31, 2024

As of September 30, 2025 and December 31, 2024, Accounts receivable consisted of the following:

(in thousands) September 30, 2025 December 31, 2024

Trade and other accounts receivable $ 243,303 $ 231,136

2 unchanged sentences

Accounts receivable, net $ 258,503 $ 246,688

As of June 30, 2025 and December 31, 2024, the Company had trade accounts receivable from SAFRAN of $ 68.0 million and $ 77.7 million, respectively.

As of June 30, 2025 and December 31, 2024, the Company did not have any Noncurrent receivables and related Allowance for expected credit losses.

As of September 30, 2025 and December 31, 2024, the Company had trade accounts receivable from SAFRAN of $ 67.1 million and $ 77.7 million, respectively.

Contract Assets and Liabilities

4 unchanged sentences

Contract assets and Contract liabilities are reported on the Consolidated Balance Sheets in a net position on a contract-by-contract basis at the end of each reporting period.

As of June 30, 2025 and December 31, 2024, Contract assets and Contract liabilities consisted of the following:

(in thousands) June 30, 2025 December 31, 2024

As of September 30, 2025 and December 31, 2024, Contract assets and Contract liabilities consisted of the following:

(in thousands) September 30, 2025 December 31, 2024

Contract assets $ 140,996 $ 167,397

3 unchanged sentences

Contract liabilities $ 9,802 $ 6,085

Contract assets, net increased $ 18.4 million during the six months ended June 30, 2025.

The increase was

primarily due to an increase in unbilled revenue, primarily related to commercial and defense programs.

There were no impairment losses related to our Contract assets during the six months ended June 30, 2025 and June 30, 2024.

Contract liabilities increased $ 2.4 million for the period ended June 30, 2025 compared to December 31, 2024, primarily due to the amounts invoiced to customers for contracts that were in a contract liability position exceeding the revenue recognized from satisfied performance obligations.

Revenue recognized for the six months ended June 30, 2025 and 2024 that was included in the Contract liability balance at the beginning of the year was $ 4.8 million and $ 3.8 million, respectively.

Contract assets, net decreased $ 26.3 million during the nine months ended September 30, 2025, primarily due to a decrease in unbilled revenue related to commercial and defense programs.

There were no impairment losses related to our Contract assets during the nine months ended September 30, 2025 and September 30, 2024.

Contract liabilities increased $ 3.7 million for the period ended September 30, 2025 compared to December 31, 2024, primarily due to the amounts invoiced to customers for contracts that were in a contract liability position exceeding the revenue recognized from satisfied performance obligations.

Revenue recognized for the nine months ended September 30, 2025 and 2024 that was included in the Contract liability balance at the beginning of the year was $ 5.6 million and $ 3.7 million, respectively.

Costs included in inventories are raw materials, labor, supplies and allocable depreciation and overhead.

4 unchanged sentences

Once established, the original cost of the inventory less the related write-down represents the new cost basis of such inventories.

As of June 30, 2025 and December 31, 2024, Inventories consisted of the following:

(in thousands) June 30, 2025 December 31, 2024

As of September 30, 2025 and December 31, 2024, Inventories consisted of the following:

(in thousands) September 30, 2025 December 31, 2024

Raw materials $ 85,364 $ 76,559

5 unchanged sentences

Goodwill and Other Intangible Assets

The following table sets forth the gross carrying value, accumulated amortization and net values of intangible assets and goodwill as of June 30, 2025 and December 31, 2024:

June 30, 2025

The following table sets forth the gross carrying value, accumulated amortization and net values of intangible assets and goodwill as of September 30, 2025 and December 31, 2024:

September 30, 2025

(in thousands) Amortization

39 unchanged sentences

$ 181,973 $ — $ 181,973

The changes in intangible assets, net and goodwill from December 31, 2024 to June 30, 2025, were as follows:

The changes in intangible assets, net and goodwill from December 31, 2024 to September 30, 2025, were as follows:

(in thousands) December 31, 2024 Other

Changes Amortization Currency

Translation June 30, 2025

Translation September 30, 2025

Finite-lived intangible assets:

13 unchanged sentences

Goodwill and intangible assets with indefinite useful lives are not amortized, but are tested for impairment at least annually.

In the second quarter of 2025, management applied the qualitative assessment approach in performing its annual evaluation of goodwill for the Company's Machine Clothing reporting unit and AEC reporting unit and concluded that each reporting unit’s fair value continued to exceed its carrying value.

Accordingly, no impairment charges were recorded.

Financial Instruments

The following table represents the Company's outstanding debt:

(in thousands, except interest rates) June 30, 2025 December 31, 2024

(in thousands, except interest rates) September 30, 2025 December 31, 2024

Borrowings under the Amended Credit Agreement

5 unchanged sentences

Long-term debt $ 480,631 $ 318,531

(1) The credit facility matures in August 2028.

At the end of June 30, 2025 and December 31, 2024, the USD interest rate in effect was 5.92 % and 5.77 %, respectively, including the effect of interest rate swaps;

at the end of June 30, 2025 and December 31, 2024, the EUR interest rate in effect was 3.72 % and 4.09 %, respectively, including the effect of interest rate swaps.

Amended Credit Agreement

9 unchanged sentences

0.350 % 1.000 % 2.000 %

As of June 30, 2025, the applicable interest rate for borrowings under the Amended Credit Agreement was based on one-month term SOFR and one-month EURIBOR plus the spread, which was 1.625 %.

As of June 30, 2025, there was $ 444.7 million of borrowings outstanding under the Amended Credit Agreement and we had borrowings available of $ 355.3 million, based on our maximum leverage ratio and our Consolidated EBITDA (as defined in the Amended Credit Agreement).

As of September 30, 2025, the applicable interest rate for borrowings under the Amended Credit Agreement was based on one-month term SOFR and one-month EURIBOR plus the spread, which was 1.625 %.

As of September 30, 2025, there was $ 480.6 million of borrowings outstanding under the Amended Credit Agreement and we had borrowings available of $ 319.4 million, based on our maximum leverage ratio and our Consolidated EBITDA (as defined in the Amended Credit Agreement).

At the end of September 30, 2025 and December 31, 2024, the USD interest rate in effect was 5.84 % and 5.77 %, respectively, including the effect of interest rate swaps;

at the end of September 30, 2025 and December 31, 2024, the EUR interest rate in effect was 3.70 % and 4.09 %, respectively, including the effect of interest rate swaps.

Under the Amended Credit Agreement, we are required to maintain a leverage ratio (as defined in the Credit Agreement) of not greater than 3.75 to 1.00, or 4.25 to 1.00 after a significant acquisition.

1 unchanged sentence

If our leverage ratio exceeds 3.50 to 1.00, we will be restricted in paying dividends to a maximum amount of $ 40 million in a calendar year

As of June 30, 2025, our leverage ratio wa s 1.63 to 1.00 and our interest coverage ratio was 10.51 to 1.00.

As of June 30, 2025, we were in compliance with all applicable covenants.

As of September 30, 2025, our leverage ratio wa s 1.70 to 1.00 and our interest coverage ratio was 9.15 to 1.00.

As of September 30, 2025, we were in compliance with all applicable covenants.

We anticipate continued compliance in each of the next four quarters while continuing to monitor future compliance based on current and future economic conditions.

4 unchanged sentences

From time to time, the Company enters into interest rate swap contracts to manage the interest rate risk associated with its outstanding variable-interest rate borrowings.

Such contracts are intended to economically hedge the reference rate component of future interest payments associated with outstanding borrowings under the Company’s Amended Credit Agreement.

Such contracts are intended to economically hedge the

reference rate component of future interest payments associated with outstanding borrowings under the Company’s Amended Credit Agreement.

In November, 2024, we entered into two interest rate swap agreements:

18 unchanged sentences

This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

We had no Level 3 financial assets or liabilities at June 30, 2025 or at December 31, 2024, other than certain pension assets as indicated in our December 31, 2024 Annual Report on Form 10-K.

We had no Level 3 financial assets or liabilities at September 30, 2025 or at December 31, 2024, other than certain pension assets as indicated in our December 31, 2024 Annual Report on Form 10-K.

The following table presents the fair-value hierarchy for our Level 1 and Level 2 financial and non-financial assets and liabilities, which are measured at fair value on a recurring basis:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in thousands)

13 unchanged sentences

The fair value of our interest rate swaps is derived from a discounted cash flow analysis based on the terms of the contract and the interest rate curve, and is included in Other assets and/or Other noncurrent liabilities in the Consolidated Balance Sheets.

Unrealized gains and losses on the interest rate swaps flow through the caption Derivative valuation adjustment in the Shareholders’ equity section of the Consolidated Balance Sheets.

As of June 30, 2025, these interest rate swaps were determined to be highly effective hedges of interest rate cashflow risk.

Unrealized gains and losses on the interest rate swaps are recorded as a component of Derivative valuation adjustment in the Shareholders’ equity section of the Consolidated Balance Sheets.

As of September 30, 2025, these interest rate swaps were determined to be highly effective hedges of interest rate cashflow risk.

Amounts accumulated in Other comprehensive income are reclassified as interest expense/(income), net when the related interest payments (that is, the hedged forecasted transactions), affect earnings.

Interest expense/(income) related to payments under the active swap agreements totaled $( 0.3 ) million for the six months ended June 30, 2025 and $( 8.2 ) million for the six months ended June 30, 2024.

Interest expense/(income) related to payments under the active swap agreements totaled $( 0.3 ) million for the nine months ended September 30, 2025 and $( 12.3 ) million for the nine months ended September 30, 2024.

We operate our business in many regions of the world, and currency rate movements can have a significant effect on operating results.

4 unchanged sentences

For all positions, whether options or forward contracts, there is a risk from the possible inability of the financial institution to meet the terms of the contracts and the risk of unfavorable changes in interest and currency rates, which may reduce the value of the instruments.

We seek to mitigate risk by evaluating the creditworthiness of counterparties

and by monitoring the currency exchange and interest rate markets while reviewing the hedging risks and contracts to ensure compliance with our internal guidelines and policies.

We seek to mitigate risk by evaluating the creditworthiness of counterparties and by monitoring the currency exchange and interest rate markets while reviewing the hedging risks and contracts to ensure compliance with our internal guidelines and policies.

(Gains)/losses related to changes in fair value of derivative instruments that were recognized in Other (income)/expense, net in the Consolidated Statements of Income were as follows:

Three months ended June 30, Six months ended June 30,

Three months ended September 30, Nine months ended September 30,

(in thousands) 2025 2024 2025 2024

5 unchanged sentences

is a defendant in suits brought in various courts in the United States by plaintiffs who allege that they have suffered personal injury as a result of exposure to asbestos-containing paper machine clothing synthetic dryer fabrics marketed during the period from 1967 to 1976 and used in certain paper mills.

We were defending 3,660 claims as of June 30, 2025.

We were defending 3,669 claims as of September 30, 2025.

The following table sets forth the number of claims filed, the number of claims settled, dismissed or otherwise resolved, and the aggregate settlement amount during the periods presented:

3 unchanged sentences

For the period ended December 31, 2024 3,606 10 50 3,646 $ 13

For the period ended June 30, 2025 3,646 19 33 3,660 $ 105

For the period ended September 30, 2025 3,646 23 46 3,669 $ 165

We anticipate that additional claims will be filed against the Company and related companies in the future but are unable to predict the number and timing of such future claims.

2 unchanged sentences

Our insurance carrier has defended each case and funded settlements under a standard reservation of rights.

As of June 30, 2025, we had resolved, by means of settlement or dismissal, 38,070 claims at a total cost of $ 10.8 million.

As of September 30, 2025, we had resolved, by means of settlement or dismissal, 38,074 claims at a total cost of $ 10.9 million.

Of this amount, almost 100 % was paid by our insurance carrier, who has confirmed that we have approximately $ 140 million of remaining coverage under primary and excess policies that should be available with respect to current and future asbestos claims.

1 unchanged sentence

(“Brandon”), is also a separate defendant in many of the asbestos cases in which Albany is named as a defendant, despite never having manufactured any fabrics containing asbestos.

While Brandon was defending against 7,675 claims as of June 30, 2025, only twelve claims have been filed against Brandon since January 1, 2012, and only $ 15,000 in settlement costs have been incurred since 2001.

While Brandon was defending against 7,675 claims as of September 30, 2025, only twelve claims have been filed against Brandon since January 1, 2012, and only $ 15,000 in settlement costs have been incurred since 2001.

Brandon was acquired by the Company in 1999 and has its own insurance policies covering periods prior to 1999.

7 unchanged sentences

On this basis, we have successfully moved for dismissal in a number of actions.

We currently do not anticipate, based on currently available information, that the ultimate resolution of the

aforementioned proceedings will have a material adverse effect on the financial position, results of operations, or cash flows of the Company.

We currently do not anticipate, based on currently available information, that the ultimate resolution of the aforementioned proceedings will have a material adverse effect on the financial position, results of operations, or cash flows of the Company.

Although we cannot predict the number and timing of future claims, based on the foregoing factors, the trends in claims filed against us, and available insurance, we also do not currently anticipate that potential future claims will have a material adverse effect on our financial position, results of operations, or cash flows.

Changes in Shareholders’ Equity

The following table summarizes changes in Shareholders’ Equity for the period December 31, 2024 to June 30, 2025:

The following tables summarize changes in Shareholders’ Equity for the three and nine month period ended September 30, 2025:

Additional paid-in capital

3 unchanged sentences

Total Shareholders' Equity

December 31, 2024 40,917 $ 41 $ 452,933 $ 1,065,763 $ ( 195,989 ) 9,845 $ ( 379,210 ) $ 5,409 $ 948,947

Net income — — — 17,355 — — — ( 6 ) 17,349

Compensation and benefits paid or payable in shares 56 — 2,651 — — — — — 2,651

June 30, 2025 40,984 $ 41 $ 456,587 $ 1,075,934 $ ( 144,292 ) 11,516 $ ( 499,658 ) $ 5,497 $ 894,109

Net income/(loss) — — — ( 97,760 ) — — — 122 ( 97,638 )

Stock issued under incentive compensation plans 5 — — — — — — — —

Taxes paid in lieu of share issuance — — ( 137 ) — — — — — ( 137 )

Stock-based compensation — — 3,844 3,844

Purchase of Treasury shares (a) — — — — — 810 ( 50,516 ) — ( 50,516 )

1 unchanged sentence

— — — ( 7,739 ) — — — — ( 7,739 )

Dividends paid to noncontrolling interests

— — — — — — — ( 88 ) ( 88 )

Cumulative translation adjustments — — — — 2,395 — — 90 2,485

1 unchanged sentence

Derivative valuation adjustment and other — — — — 126 — — — 126

— — — 7 ( 635 ) — — — ( 628 )

March 31, 2025 40,973 $ 41 $ 455,584 $ 1,074,863 $ ( 182,150 ) 10,770 $ ( 448,363 ) $ 5,193 $ 905,168

Net income — — — 9,183 — — — 149 9,332

Compensation and benefits paid or payable in shares — — 243 — — — — — 243

September 30, 2025 40,989 $ 41 $ 460,294 $ 970,435 $ ( 141,298 ) 12,326 $ ( 550,174 ) $ 5,709 $ 745,007

Common Stock Additional paid-in capital Retained

earnings Accumulated items of other comprehensive income Class A

Treasury Stock Noncontrolling Interest Total Shareholders' Equity

Shares Amount Shares Amount

December 31, 2024 40,917 $ 41 $ 452,933 $ 1,065,763 $ ( 195,989 ) 9,845 $ ( 379,210 ) $ 5,409 $ 948,947

Net income/(loss) — — — ( 71,222 ) — — — 265 ( 70,957 )

Stock issued under incentive compensation plans 61 — ( 1,067 ) — — — — — ( 1,067 )

Taxes paid in lieu of share issuance — — ( 1,454 ) — — — — — ( 1,454 )

Stock-based compensation — — 9,122 — — — — — 9,122

Shares issued to Directors' 11 — 760 — — — — — 760

2 unchanged sentences

— — — ( 24,025 ) — — — — ( 24,025 )

Dividends paid to noncontrolling interests — — — — — — — ( 88 ) ( 88 )

Cumulative translation adjustments — — — — 58,366 — — 35 58,401

1 unchanged sentence

Derivative valuation adjustment and other — — — ( 81 ) ( 631 ) — — 88 ( 624 )

— — — ( 88 ) ( 122 ) — — 88 ( 122 )

June 30, 2025 40,984 $ 41 $ 456,587 $ 1,075,934 $ ( 144,292 ) 11,516 $ ( 499,658 ) $ 5,497 $ 894,109

The following table summarizes changes in Shareholders’ Equity for the period December 31, 2023 to June 30, 2024:

September 30, 2025 40,989 $ 41 $ 460,294 $ 970,435 $ ( 141,298 ) 12,326 $ ( 550,174 ) $ 5,709 $ 745,007

The following table summarizes changes in Shareholders’ Equity for the three and nine month period ended September 30, 2024:

Additional paid-in capital

4 unchanged sentences

(in thousands)

December 31, 2023 40,856 $ 41 $ 448,218 $ 1,010,942 $ ( 133,168 ) 9,662 $ ( 364,665 ) $ 5,952 $ 967,320

Net income — — — 27,291 — — — 78 27,369

June 30, 2024 40,908 $ 41 $ 452,461 $ 1,046,612 $ ( 166,907 ) 9,662 $ ( 364,665 ) $ 5,806 $ 973,348

Net income/(loss) — — — 18,029 — — — 192 18,221

Compensation and benefits paid or payable in shares 9 — 195 — — — — — 195

1 unchanged sentence

— — — ( 8,127 ) — — — — ( 8,127 )

Initial equity related to Noncontrolling interest in Arcari — — — — — — — ( 166 ) ( 166 )

Cumulative translation adjustments — — — — 16,931 — — ( 153 ) 16,778

1 unchanged sentence

Derivative valuation adjustment — — — — ( 2,950 ) — — — ( 2,950 )

March 31, 2024 40,898 $ 41 $ 449,028 $ 1,030,111 $ ( 147,026 ) 9,662 $ ( 364,665 ) $ 6,076 $ 973,565

Net income — — — 24,624 — — — 96 24,720

September 30, 2024 40,917 $ 41 $ 452,656 $ 1,056,514 $ ( 153,549 ) 9,662 $ ( 364,665 ) $ 5,679 $ 996,676

Additional paid-in capital

Accumulated items of other comprehensive income Class A

Treasury Stock

Noncontrolling Interest

Shareholders' Equity

(in thousands)

December 31, 2023 40,856 $ 41 $ 448,218 $ 1,010,942 $ ( 133,168 ) 9,662 $ ( 364,665 ) $ 5,952 $ 967,320

Net income/(loss) — — — 69,944 — — — 366 70,310

Compensation and benefits paid or payable in shares 51 — 3,535 — — — — — 3,535

Options exercised — — — — — — — — —

Shares issued to Directors' 10 — 903 0 — — — — 903

Dividends declared on Class A Common Stock, $ 0.26 per share

Class A Common Stock, $ 0.78 per share

— — — ( 24,372 ) — — — — ( 24,372 )

Inital equity related to Noncontolling interest in Arcari — — — 0 — — — ( 166 ) ( 166 )

Cumulative translation adjustments — — — — ( 12,472 ) — — ( 473 ) ( 12,945 )

1 unchanged sentence

Derivative valuation adjustment — — — — ( 7,914 ) — — — ( 7,914 )

June 30, 2024 40,908 $ 41 $ 452,461 $ 1,046,612 $ ( 166,907 ) 9,662 $ ( 364,665 ) $ 5,806 $ 973,348

September 30, 2024 40,917 $ 41 $ 452,656 $ 1,056,514 $ ( 153,549 ) 9,662 $ ( 364,665 ) $ 5,679 $ 996,676

(a) In 2021, the Company's Board of Directors authorized the Company to repurchase shares of up to $ 200 million through open market purchases, privately negotiated transactions or otherwise, and to determine the prices, times and amounts.

3 unchanged sentences

We evaluated subsequent events through the issuance date of these financial statements in Form 10-Q.

No material subsequent events were identified that require disclosure.

On October 28th, 2025, the Company announced that it is exploring strategic alternatives for its structures assembly business, including a potential sale of all or a part of the business at the Amelia Earhart Drive Facility in Salt Lake City.

As part of the strategic alternatives, Albany is in ongoing discussions with its customer about potential contract modifications to offset these cost increases.

No other material subsequent events were identified that require disclosure.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements