What changed in this filing

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Item 1. Financial Statements

2025-07-31 compared with 2025-04-24 · 205 added, 120 removed, 525 unchanged (38% of the section changed)

3 unchanged sentences

(Dollars in thousands, except share and per share data)

Assets March 31, 2025 (unaudited) December 31, 2024

Assets June 30, 2025 (unaudited) December 31, 2024

Current assets:

Cash and cash equivalents $ 65,427 $ 49,515

Accounts receivable, net of allowances of $ 838 and $ 909 at March 31, 2025 and December 31, 2024, respectively

Accounts receivable, net of allowance for credit losses of $ 837 and $ 909 at June 30, 2025 and December 31, 2024, respectively

135,982 119,662

5 unchanged sentences

Goodwill 816,391 780,030

Intangible assets with finite lives, net 165,965 165,050

Customer relationships and lists, net 139,347 132,484

Other intangible assets with finite lives, net 32,518 32,566

Right of use assets - operating leases 15,655 15,320

25 unchanged sentences

Authorized 120,000,000 shares;

32,611,544 and 32,527,244 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

32,455,554 and 32,527,244 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively

Additional paid-in capital 151,412 173,997

Retained earnings 1,072,824 997,493

Accumulated other comprehensive income ( 2,263 ) ( 23,747 )

Accumulated other comprehensive income (loss) 41,512 ( 23,747 )

Total stockholders' equity 1,267,913 1,149,913

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net sales $ 255,467 $ 234,081 $ 505,986 $ 473,740

9 unchanged sentences

Interest expense, net 2,766 4,240 5,690 9,638

Other expense (income), net 151 ( 572 )

Other (income) expense, net ( 335 ) 331 ( 184 ) ( 241 )

2,431 4,571 5,506 9,397

Earnings before income tax expense 49,011 41,226 96,951 78,076

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net earnings $ 38,278 $ 32,069 $ 75,331 $ 61,055

7 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders’ Equity

For the Three Months Ended March 31, 2025 and 2024

For the Three and Six Months Ended June 30, 2025 and 2024

(Dollars in thousands, except share and per share data)

7 unchanged sentences

Net earnings 37,053 37,053 — — — —

Other comprehensive gain 21,484 — 21,484 — — —

Other comprehensive income 21,484 — 21,484 — — —

Repurchases of common stock ( 5,325 ) — — ( 32,869 ) ( 2 ) ( 5,323 )

1 unchanged sentence

Balance - March 31, 2025 1,208,701 1,034,546 ( 2,263 ) 32,611,544 2,175 174,243

Net earnings 38,278 38,278 — — — —

Other comprehensive income 43,775 — 43,775 — — —

Repurchases of common stock, including

excise tax ( 33,348 ) — — ( 204,965 ) ( 13 ) ( 33,335 )

Shares and options issued under stock plans 10,507 — — 48,975 3 10,504

Balance - June 30, 2025 $ 1,267,913 $ 1,072,824 $ 41,512 32,455,554 $ 2,165 $ 151,412

Balance - December 31, 2023 $ 1,053,984 $ 897,488 $ 8,691 32,254,728 $ 2,152 $ 145,653

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Balance - March 31, 2024 1,078,791 926,474 ( 3,872 ) 32,423,400 2,163 154,026

Net earnings 32,069 32,069 — — — —

Other comprehensive loss ( 3,262 ) — ( 3,262 ) — — —

Repurchases of common stock, including

excise tax ( 11 ) — — ( 72 ) — ( 11 )

Shares and options issued under stock plans 4,777 — — 11,530 1 4,776

Balance - June 30, 2024 $ 1,112,364 $ 958,543 $ ( 7,134 ) 32,434,858 $ 2,164 $ 158,791

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(Dollars in thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

4 unchanged sentences

Deferred income taxes ( 124 ) ( 1,116 )

Provision for doubtful accounts ( 79 ) 223

Unrealized loss (gain) on foreign currency transactions and deferred compensation 24 ( 726 )

Loss (gain) on disposal of assets 65 ( 144 )

Provision for credit losses ( 108 ) 295

Unrealized gain on foreign currency transactions and deferred compensation ( 843 ) ( 507 )

(Gain) loss on disposal of assets and asset impairment ( 117 ) 313

Change in fair value of contingent consideration liability — ( 91 )

Changes in assets and liabilities

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GAAP” or “GAAP”) governing interim financial statements and the instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934 (the "Exchange Act") and therefore do not include some information and notes necessary to conform to annual reporting requirements.

The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the operating results expected for the full year or any interim period.

The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the operating results expected for the full year or any interim period.

Certain reclassifications have been made to prior period amounts to conform with the current period's presentation.

Recent Accounting Pronouncements

Recently Issued Accounting Standards

In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2024-03, "Income Statement - Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40)." The new guidance is intended to enhance transparency and disclosures by requiring public entities to provide disaggregated disclosures of certain categories of expenses on an annual and interim basis.

In November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40)." The new guidance is intended to enhance transparency and disclosures by requiring public entities to provide disaggregated disclosures of certain categories of expenses on an annual and interim basis.

The ASU is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted.

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Stock-Based Compensation

The Company’s results for the three months ended March 31, 2025 and 2024 reflected the following stock-based compensation cost, and such compensation cost had the following effects on net earnings:

Increase/(Decrease) for the

Three Months Ended March 31,

The Company’s results for the three and six months ended June 30, 2025 and 2024 reflected the following stock-based compensation cost, and such compensation cost had the following effects on net earnings:

Increase/(Decrease) for the Increase/(Decrease) for the

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Cost of sales $ 536 $ 425 $ 974 $ 825

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The Company has approved and reserved a number of shares to be issued upon exercise of the outstanding options that is adequate to cover all exercises.

As of March 31, 2025, the Plan had 685,590 shares available for future awards.

As of June 30, 2025, the Plan had 686,270 shares available for future awards.

Compensation expense for stock options and stock awards is recognized on a straight-line basis over the vesting period, generally three to five years for stock options, three years for employee restricted stock awards, three years for employee performance share awards, and one to three years for non-employee director restricted stock awards.

Certain awards provide for accelerated vesting if there is a change in control (as defined in the plans) or other qualifying events.

Option activity for the three months ended March 31, 2025 and 2024 is summarized below:

For the Three Months Ended March 31, 2025 Shares (000s) Weighted

Option activity for the six months ended June 30, 2025 and 2024 is summarized below:

For the Six Months Ended June 30, 2025 Shares (000s) Weighted

Price Aggregate

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Forfeited — —

Outstanding as of March 31, 2025 995 $ 117.53 $ 48,212 5.6

Exercisable as of March 31, 2025 688 $ 105.78 $ 41,408 4.4

For the Three Months Ended March 31, 2024 Shares (000s) Weighted

Outstanding as of June 30, 2025 945 $ 118.88 $ 38,084 5.6

Exercisable as of June 30, 2025 638 $ 106.87 $ 33,375 4.4

For the Six Months Ended June 30, 2024 Shares (000s) Weighted

Price Aggregate

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Forfeited ( 2 ) 137.06

Outstanding as of March 31, 2024 1,065 $ 112.48 $ 45,223 6.3

Exercisable as of March 31, 2024 699 $ 97.89 $ 39,881 4.9

Outstanding as of June 30, 2024 1,052 $ 112.90 $ 43,199 6.0

Exercisable as of June 30, 2024 687 $ 98.31 $ 38,241 4.7

ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award.

The weighted average fair values of the stock options granted under the Plan were calculated using either the Black-Scholes model or the Binomial model, whichever was deemed to be most appropriate.

The fair value of each option grant was estimated on the date of the grant using the following weighted average assumptions for the three months ended March 31, 2025 and 2024, respectively:

dividend yields of 0.6 % and 0.6 %;

expected volatilities of 26 % and 28 %;

risk-free interest rates of 4.5 % and 4.1 % and expected lives of 5.2 years and 5.0 years.

For the six months ended June 30, 2025, the fair value of each option grant was estimated on the date of the grant using the following weighted average assumptions:

dividend yields of 0.6 %;

expected volatilities of 26 %;

risk-free interest rates of 4.5 %;

and expected lives of 5.2 years.

For the six months ended June 30, 2024, the fair value of each option grant was estimated on the date of the grant using the following weighted average assumptions:

dividend yields of 0.6 %;

expected volatilities of 28 %;

risk-free interest rates of 4.1 %;

and expected lives of 5.0 years.

The Company used a projected expected life for each award granted based on historical experience of employees’ exercise behavior.

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Treasury zero-coupon issues with a remaining term equal to the expected life.

Other information pertaining to option activity during the three months ended March 31, 2025 and 2024 is as follows:

Other information pertaining to option activity during the three and six months ended June 30, 2025 and 2024 is as follows:

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Weighted-average fair value of options granted $ — $ — $ 48.86 $ 44.52

Total intrinsic value of stock options exercised ($000s) $ 3,370 $ 944 $ 4,759 $ 11,321

Non-vested restricted stock activity for the three months ended March 31, 2025 and 2024 is summarized below:

Three Months Ended March 31,

Non-vested restricted stock activity for the six months ended June 30, 2025 and 2024 is summarized below:

Six Months Ended June 30,

Shares (000s) Weighted

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Forfeited ( 1 ) 145.96 ( 2 ) 132.81

Non-vested balance as of March 31 147 $ 148.68 118 $ 139.95

Non-vested performance share activity for the three months ended March 31, 2025 and 2024 is summarized below:

Three Months Ended March 31,

Non-vested balance as of June 30 145 $ 148.91 119 $ 140.14

Non-vested performance share activity for the six months ended June 30, 2025 and 2024 is summarized below:

Six Months Ended June 30,

Shares (000s) Weighted

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Forfeited ( 4 ) 152.69 — —

Non-vested balance as of March 31 81 $ 160.14 79 $ 150.73

Non-vested balance as of June 30 81 $ 160.14 79 $ 150.73

The Company's performance share (“PS”) awards provide the recipients the right to receive a certain number of shares of the Company’s common stock in the future, subject to an EBITDA performance hurdle, where vesting is dependent upon the Company achieving a certain EBITDA percentage growth over the performance period, or relative total shareholder return ("TSR") where vesting is dependent upon the Company’s TSR performance over the performance period relative to a comparator group consisting of the Russell 2000 index constituents.

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volatilities of 26 % and 25 %;

and initial TSR's of - 8.8 % and 10.3 %, in each case for the three months ended March 31, 2025 and 2024, respectively.

Expense is estimated based on the number of shares expected to vest, assuming the requisite service period is rendered and the probable

outcome of the performance condition is achieved.

and initial TSR's of - 8.8 % and 10.3 %, in each case for the six months ended June 30, 2025 and 2024, respectively.

Expense is estimated based on the number of shares expected to vest, assuming the requisite service period is rendered and the probable outcome of the performance condition is achieved.

The estimate is revised if subsequent information indicates that the actual number of shares likely to vest differs from previous estimates.

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For PS awards granted in 2024 and 2025, grants are subject to such holding period.

As of March 31, 2025 and 2024, there were $ 31,427 and $ 30,380 , respectively, of total unrecognized compensation costs related to non-vested share-based compensation arrangements granted under the plans.

As of March 31, 2025, the unrecognized compensation cost is expected to be recognized over a weighted-average period of approximately 1.8 years.

As of June 30, 2025 and 2024, there were $ 26,849 and $ 26,557 , respectively, of total unrecognized compensation costs related to non-vested share-based compensation arrangements granted under the plans.

As of June 30, 2025, the unrecognized compensation cost is expected to be recognized over a weighted-average period of approximately 1.6 years.

The Company estimates that share-based compensation expense for the year ended December 31, 2025 will be approximately $ 18,800 .

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The Company intends to acquire shares from time to time at prevailing market prices if and to the extent it deems it is advisable to do so based on its assessment of corporate cash flow, market conditions and other factors.

Open market repurchases of common stock could be made pursuant to a trading plan established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which would permit common stock to be repurchased at a time that the Company might otherwise be precluded from doing so under insider trading laws or self-imposed trading restrictions.

Open market repurchases of common stock could be made pursuant to a share repurchase agreement in compliance with Rule 10b-18 or a trading plan established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which would permit common stock to be repurchased at a time that the Company might otherwise be precluded from doing so under insider trading laws or self-imposed trading restrictions.

The Company also repurchases (withholds) shares from employees in connection with the tax settlement of vested shares and/or exercised stock options, as applicable, under the Company's omnibus incentive plan.

Such repurchases of shares from employees are funded with existing cash on hand.

During the three months ended March 31, 2025 and 2024, the Company purchased 32,869 and 36,122 shares, respectively, from employees in connection with the tax settlement of vested shares and/or exercised stock options, as applicable, under the Company's omnibus incentive plan at an average cost of $ 161.99 and $ 144.02 , respectively.

During the six months ended June 30, 2025, the Company repurchased 237,834 shares from open market purchases and/or withheld shares from employees in connection with the tax settlement of vested shares and/or exercised stock options, as applicable, under the Company's omnibus incentive plan at an average cost of $ 162.25 .

During the six months ended June 30, 2024, the Company purchased 36,194 shares from employees in connection with the tax settlement of vested shares and/or exercised stock options, as applicable, under the Company's omnibus incentive plan at an average cost of $ 144.04 .

NOTE 3 – INVENTORIES

Inventories, net of reserves at March 31, 2025 and December 31, 2024 consisted of the following:

March 31, 2025 December 31, 2024

Inventories, net of reserves at June 30, 2025 and December 31, 2024 consisted of the following:

June 30, 2025 December 31, 2024

Raw materials $ 42,966 $ 45,319

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NOTE 4 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment at March 31, 2025 and December 31, 2024 are summarized as follows:

March 31, 2025 December 31, 2024

Property, plant and equipment at June 30, 2025 and December 31, 2024 are summarized as follows:

June 30, 2025 December 31, 2024

Land $ 12,429 $ 11,690

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If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset, which is generally based on discounted cash flows.

There were no impairment charges recorded for the three months ended March 31, 2025 and 2024.

NOTE 5 - INTANGIBLE ASSETS

The Company had goodwill in the amount of $ 793,087 and $ 780,030 as of March 31, 2025 and December 31, 2024, respectively, subject to the provisions of ASC 350, “Intangibles-Goodwill and Other.” The increase in goodwill is primarily due to foreign currency translation adjustments.

Identifiable intangible assets with finite lives at March 31, 2025 and December 31, 2024 are summarized as follows:

(in years) Gross Carrying Amount at March 31, 2025 Accumulated Amortization at March 31, 2025 Gross Carrying Amount at December 31, 2024 Accumulated Amortization at December 31, 2024

Customer relationships & lists 10 - 20

The Company had goodwill in the amount of $ 816,391 and $ 780,030 as of June 30, 2025 and December 31, 2024, respectively, subject to the provisions of ASC 350, “Intangibles-Goodwill and Other.” The increase in goodwill is primarily due to foreign currency translation adjustments.

Identifiable intangible assets with finite lives at June 30, 2025 and December 31, 2024 are summarized as follows:

(in years) Gross Carrying Amount at June 30, 2025 Accumulated Amortization at June 30, 2025 Gross Carrying Amount at December 31, 2024 Accumulated Amortization at December 31, 2024

Customer relationships and lists 10 - 20

$ 370,800 $ 231,453 $ 354,051 $ 221,567

Trademarks & trade names 2 - 17

Trademarks and trade names 2 - 17

52,258 42,954 50,971 41,417

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25,013 22,020 25,154 21,854

$ 476,794 $ 310,829 $ 470,250 $ 305,200

Amortization of identifiable intangible assets was approximately $ 4,060 and $ 6,342 for the three months ended March 31, 2025 and 2024, respectively.

Other intangible assets with finite lives 119,661 87,143 116,199 83,633

Total intangible assets with finite lives $ 490,461 $ 318,596 $ 470,250 $ 305,200

Amortization of identifiable intangible assets was approximately $ 4,261 and $ 8,321 for the three and six months ended June 30, 2025 respectively, and $ 5,243 and $ 11,585 for the three and six months ended June 30, 2024, respectively.

Assuming no change in the gross carrying value of identifiable intangible assets, estimated amortization expense is $ 8,324 for the remainder of 2025, $ 16,572 for 2026, $ 16,043 for 2027, $ 15,585 for 2028, $ 15,178 for 2029 and $ 14,796 for 2030.

At March 31, 2025 and December 31, 2024, there were no identifiable intangible assets with indefinite useful lives as defined by ASC 350.

Identifiable intangible assets are reflected in “Intangible assets with finite lives, net” on the Company’s condensed consolidated balance sheets.

There were no changes to the useful lives of intangible assets subject to amortization during the three months ended March 31, 2025 and 2024.

At June 30, 2025 and December 31, 2024, there were no identifiable intangible assets with indefinite useful lives as defined by ASC 350.

Identifiable intangible assets are reflected in "Customer relationships and lists, net" and “Other intangible assets with finite lives, net” on the Company’s condensed consolidated balance sheets.

There were no changes to the useful lives of intangible assets subject to amortization during the six months ended June 30, 2025 and 2024.

NOTE 6 - EQUITY METHOD INVESTMENT

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The joint venture is accounted for under the equity method of accounting since the Company is not the primary beneficiary as the Company does not have the power to direct the activities of the joint venture that most significantly impact its economic performance.

The Company recognized a loss of $ 122 and $ 121 for the three months ended March 31, 2025 and 2024, respectively, relating to its portion of the joint venture's expenses in other expense.

The Company made capital contributions to the investment totaling $ 30 and $ 42 for the three months ended March 31, 2025 and 2024, respectively.

The carrying value of the joint venture at March 31, 2025 and December 31, 2024 was $ 3,764 and $ 3,856 , respectively, and is recorded in "Other non-current assets" on the condensed consolidated balance sheets.

The Company recognized a loss of $ 123 and $ 245 for the three and six months ended June 30, 2025, respectively, and $ 122 and $ 243 for the three and six months ended June 30, 2024, respectively, relating to its portion of the joint venture's expenses in other expense.

The Company made capital contributions to the investment totaling $ 75 and $ 105 for the three and six months ended June 30, 2025, respectively, and $ 38 and $ 80 for the three and six months ended June 30, 2024, respectively.

The carrying value of the joint venture at June 30, 2025 and December 31, 2024 was $ 3,716 and $ 3,856 , respectively, and is recorded in "Other non-current assets" on the condensed consolidated balance sheets.

NOTE 7 – REVOLVING LOAN

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The loans may be used for working capital, letters of credit, and other corporate purposes and may be drawn upon at the Company’s discretion.

As of both March 31, 2025 and December 31, 2024, the total balance outstanding on the 2022 Credit Agreement amounted to $ 190,000 .

As of both June 30, 2025 and December 31, 2024, the total balance outstanding on the 2022 Credit Agreement amounted to $ 190,000 .

There are no installment payments required on the revolving loans;

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Amounts outstanding under the 2022 Credit Agreement are subject to an interest rate equal to a fluctuating rate as defined by the 2022 Credit Agreement plus an applicable rate.

The applicable rate is based upon the Company’s consolidated net leverage ratio, as defined in the 2022 Credit Agreement, and the interest rate was 5.43 % at March 31, 2025.

The Company is also required to pay a commitment fee on the unused portion of the revolving loan, which is based on the Company’s consolidated net leverage ratio as defined in the 2022 Credit Agreement and ranges from 0.150 % to 0.225 % ( 0.150 % at March 31, 2025).

The unused portion of the revolving loan amounted to $ 360,000 at March 31, 2025.

The applicable rate is based upon the Company’s consolidated net leverage ratio, as defined in the 2022 Credit Agreement, and the interest rate was 5.43 % at June 30, 2025.

The unused portion of the revolving loan amounted to $ 360,000 at June 30, 2025.

The Company is also required to pay, as applicable, letter of credit fees, administrative agent fees, and other fees to the arrangers and lenders.

Costs associated with the issuance of the revolving loans are capitalized and amortized on a straight-line basis over the term of the 2022 Credit Agreement, which is not materially different than the effective interest method.

Capitalized costs net of accumulated amortization were $ 671 and $ 743 at March 31, 2025 and December 31, 2024, respectively, and are included in "Other non-current assets" on the condensed consolidated balance sheets.

Amortization expense pertaining to these costs totaled $ 71 for both the three months ended March 31, 2025 and 2024 and are included in "Interest expense, net" in the accompanying condensed consolidated statements of earnings.

Capitalized costs net of accumulated amortization were $ 599 and $ 743 at June 30, 2025 and December 31, 2024, respectively, and are included in "Other non-current assets" on the condensed consolidated balance sheets.

Amortization expense pertaining to these costs totaled $ 73 and $ 144 for both the three and six months ended June 30, 2025 and 2024 and are included in "Interest expense, net" in the accompanying condensed consolidated statements of earnings.

The 2022 Credit Agreement contains quarterly covenants requiring the consolidated leverage ratio to be less than a certain maximum ratio and the consolidated interest coverage ratio to exceed a certain minimum ratio.

At March 31, 2025, the Company was in compliance with these covenants.

At June 30, 2025, the Company was in compliance with these covenants.

Indebtedness under the Company’s loan agreements is secured by assets of the Company.

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Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net Earnings - Basic and Diluted $ 38,278 $ 32,069 $ 75,331 $ 61,055

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Net Earnings Per Share - Diluted $ 1.17 $ 0.98 $ 2.30 $ 1.87

The number of anti-dilutive shares were 223,820 and 448,915 for the three months ended March 31, 2025 and 2024, respectively.

The number of anti-dilutive shares were 223,890 and 224,070 for the three and six months ended June 30, 2025, respectively, and 339,366 and 357,534 for the three and six months ended June 30, 2024, respectively.

Anti-dilutive shares could potentially dilute basic earnings per share in future periods and therefore, were not included in diluted earnings per share.

NOTE 9 – INCOME TAXES

The Company’s effective tax rate for the three months ended March 31, 2025 and 2024, was 22.7 % and 21.3 %, respectively.

The higher effective tax rate for the three months ended March 31, 2025 was primarily due to lower tax benefits from stock-based compensation.

The Company’s effective tax rate for the three months ended June 30, 2025 and 2024, was 21.9 % and 22.2 %, respectively.

The lower effective tax rate for the quarter was primarily due to higher tax benefits from stock-based compensation.

The effective tax rate for the six months ended June 30, 2025 and 2024 was 22.3 % and 21.8 %, respectively.

The higher effective tax rate for the six months ended June 30, 2025 was primarily due to lower tax benefits from stock-based compensation and an unfavorable impact from foreign tax rates.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law in the United States which includes a broad range of tax provisions.

While the Company currently does not anticipate the OBBBA will have a material impact on its estimated annual effective tax rate in 2025, we will continue to assess its impact.

Income taxes are accounted for under the asset and liability method.

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and in various states and foreign countries.

As of March 31, 2025, in the major jurisdictions where the Company operates, it is generally no longer subject to income tax examinations by tax authorities for years before 2020.

The Company had approximately $ 6,786 and $ 6,720 of unrecognized tax benefits, which are included in "Other long-term obligations" on the Company’s condensed consolidated balance sheets, as of March 31, 2025 and December 31, 2024, respectively.

As of June 30, 2025, in the major jurisdictions where the Company operates, it is generally no longer subject to income tax examinations by tax authorities for years before 2020.

The Company had approximately $ 6,852 and $ 6,720 of unrecognized tax benefits, which are included in "Other long-term obligations" on the Company’s condensed consolidated balance sheets, as of June 30, 2025 and December 31, 2024, respectively.

The Company includes interest expense or income as well as potential penalties on uncertain tax positions as a component of "Income tax expense" in the condensed consolidated statements of earnings.

Total accrued interest and penalties related to uncertain tax positions at March 31, 2025 and December 31, 2024 were approximately $ 2,418 and $ 2,352 , respectively, and are included in "Other long-term obligations" on the Company’s condensed consolidated balance sheets.

Total accrued interest and penalties

related to uncertain tax positions at June 30, 2025 and December 31, 2024 were approximately $ 2,485 and $ 2,352 , respectively, and are included in "Other long-term obligations" on the Company’s condensed consolidated balance sheets.

The European Union ("EU") member states formally adopted the EU's Pillar Two Directive on December 15, 2022, which was established by the Organization for Economic Co-operation and Development.

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Pursuant to ASU 2023-07, "Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures", the significant segment information is summarized as follows:

For the Three Months Ended March 31, 2025

For the Three Months Ended June 30, 2025

HNH ANH SP Other and Unallocated Total

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Interest expense, net 2,766

Other expense 151

Other income, net ( 335 )

Earnings before income

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(4) Operating expenses within SP are primarily comprised of compensation-related costs, professional services, and amortization expense in connection with certain acquired intangible assets.

(5) Operating expenses within Other and Unallocated are primarily comprised of transaction and integration costs.

For the Three Months Ended March 31, 2024

(5) Operating expenses within Other and Unallocated are primarily comprised of compensation-related costs and transaction and integration costs.

For the Six Months Ended June 30, 2025

HNH ANH SP Other and Unallocated Total

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Operating expenses 44,064 (7) 15,152 (8) 17,049 (9) 2,559 (10) 78,824

Earnings from operations 76,316 8,750 20,854 ( 3,463 ) 102,457

Other expenses:

Interest expense, net 5,690

Other income, net ( 184 )

Earnings before income

tax expense 96,951

Income tax expense 21,620

Net earnings $ 75,331

(6) Cost of sales are primarily comprised of raw materials consumed in the manufacture of product, as well as manufacturing labor, depreciation expense, and other overhead expenses necessary to convert purchased materials and supplies into finished product.

Cost of sales also includes inbound freight costs, outbound freight costs for shipping products to customers, warehousing costs, quality control and obsolescence expense.

(7) Operating expenses within HNH are primarily comprised of compensation-related costs, professional services, including advertising and marketing costs, and amortization expense in connection with certain acquired intangible assets.

(8) Operating expenses within ANH are primarily comprised of compensation-related costs and professional services, including advertising and marketing costs.

(9) Operating expenses within SP are primarily comprised of compensation-related costs, professional services, and amortization expense in connection with certain acquired intangible assets.

(10) Operating expenses within Other and Unallocated are primarily comprised of compensation-related costs and transaction and integration costs.

For the Three Months Ended June 30, 2024

HNH ANH SP Other and Unallocated Total

Net sales $ 147,928 $ 49,557 $ 35,094 $ 1,502 $ 234,081

Cost of sales 93,215 (11) 39,774 (11) 15,965 (11) 2,133 (11) 151,087

Gross margin 54,713 9,783 19,129 ( 631 ) 82,994

Operating expenses 21,346 (12) 7,090 (13)

7,901 (14) 860 (15) 37,197

2 unchanged sentences

Interest expense, net 4,240

Other income ( 572 )

Other expense, net 331

Earnings before income

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(14) Operating expenses within SP are primarily comprised of compensation-related costs, professional services, and amortization expense in connection with certain acquired intangible assets.

(10) Operating expenses within Other and Unallocated are primarily comprised of transaction and integration costs.

Business Segment Assets March 31,

(15) Operating expenses within Other and Unallocated are primarily comprised of compensation-related costs and transaction and integration costs.

For the Six Months Ended June 30, 2024

HNH ANH SP Other and Unallocated Total

Net sales $ 300,672 $ 103,478 $ 66,707 $ 2,883 $ 473,740

Cost of sales 190,597 (16) 84,009 (16) 30,591 (16) 4,035 (16) 309,232

Gross margin 110,075 19,469 36,116 ( 1,152 ) 164,508

Operating expenses 43,451 (17) 14,716 (18)

16,689 (19) 2,179 (20) 77,035

Earnings from operations 66,624 4,753 19,427 ( 3,331 ) 87,473

Other expenses:

Interest expense, net 9,638

Other income, net ( 241 )

Earnings before income

tax expense 78,076

Income tax expense 17,021

Net earnings $ 61,055

(16) Cost of sales are primarily comprised of raw materials consumed in the manufacture of product, as well as manufacturing labor, depreciation expense, and other overhead expenses necessary to convert purchased materials and supplies into finished product.

Cost of sales also includes inbound freight costs, outbound freight costs for shipping products to customers, warehousing costs, quality control and obsolescence expense.

(17) Operating expenses within HNH are primarily comprised of compensation-related costs, professional services, including advertising and marketing costs, and amortization expense in connection with certain acquired intangible assets.

(18) Operating expenses within ANH are primarily comprised of compensation-related costs and professional services, including advertising and marketing costs.

(19) Operating expenses within SP are primarily comprised of compensation-related costs, professional services, and amortization expense in connection with certain acquired intangible assets.

(20) Operating expenses within Other and Unallocated are primarily comprised of compensation-related costs and transaction and integration costs.

Business Segment Assets June 30,

2025 December 31,

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It also includes assets associated with a few minor businesses which individually do not meet the quantitative thresholds for separate presentation.

Depreciation/Amortization Three Months Ended March 31,

Depreciation/Amortization Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Human Nutrition and Health $ 7,544 $ 8,386 $ 14,847 $ 17,926

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Total $ 11,403 $ 12,506 $ 22,417 $ 26,174

Capital Expenditures Three Months Ended March 31,

Capital Expenditures Six Months Ended June 30,

Human Nutrition and Health $ 6,026 $ 7,697

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Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Product Sales Revenue $ 255,041 $ 233,726 $ 505,102 $ 472,852

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Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

United States $ 186,706 $ 177,692 $ 372,428 $ 359,778

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NOTE 12 – SUPPLEMENTAL CASH FLOW INFORMATION

Cash paid during the three months ended March 31, 2025 and 2024 for income taxes and interest is as follows:

Three Months Ended March 31,

Cash paid during the six months ended June 30, 2025 and 2024 for income taxes and interest is as follows:

Six Months Ended June 30,

Income taxes $ 26,263 $ 19,140

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Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net foreign currency translation adjustment $ 43,776 $ ( 3,260 ) $ 65,498 $ ( 15,977 )

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Total other comprehensive income (loss) $ 43,775 $ ( 3,262 ) $ 65,259 $ ( 15,825 )

Accumulated other comprehensive income (loss) at March 31, 2025 and December 31, 2024 consisted of the following:

Accumulated other comprehensive income (loss) at June 30, 2025 and December 31, 2024 consisted of the following:

Foreign currency

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Other comprehensive income (loss) 65,498 ( 239 ) 65,259

Balance March 31, 2025 $ ( 2,460 ) $ 197 $ ( 2,263 )

Balance June 30, 2025 $ 41,316 $ 196 $ 41,512

NOTE 14 – EMPLOYEE BENEFIT PLANS

Defined Contribution Plans

The Company sponsors one 401(k) savings plan for eligible employees, which allows participants to make pretax or after tax contributions and the Company matches certain percentages of those contributions.

The plan also has a discretionary profit sharing portion and matches 401(k) contributions with shares of the Company’s Common Stock.

The Company sponsors one 401(k) savings plan for eligible employees, which allows participants to make pretax or after tax contributions, and the Company matches certain percentages of those contributions with shares of the Company’s Common Stock.

The plan also has a discretionary profit sharing portion.

All amounts contributed to the plan are deposited into a trust fund administered by independent trustees.

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Net periodic benefit costs for such retirement medical plans were as follows:

Three Months Ended March 31,

Six Months Ended June 30,

Service cost $ 58 $ 56

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Net periodic benefit cost $ 88 $ 79

T he amounts recorded for these obligations on the Company’s condensed consolidated balance sheets as of March 31, 2025 and December 31, 2024 ar e $ 1,446 a nd $ 1,522 , respectively, and are included in "Other long-term obligations" on the Company's condensed consolidated balance sheets.

T he amounts recorded for these obligations on the Company’s condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024 ar e $ 1,493 a nd $ 1,522 , respectively, and are included in "Other long-term obligations" on the Company's condensed consolidated balance sheets.

These plans are unfunded and approved claims are paid from Company funds.

Historical cash payments made under such plans have typically been less than $ 200 per year.

Defined Benefit Pension Plans

Defined Benefit Pension Plan

On May 27, 2019, the Company acquired Chemogas Holding NV, a privately held specialty gases company headquartered in Grimbergen, Belgium ("Chemogas"), which has an unfunded defined benefit pension plan.

The plan provides for the payment of a lump sum at retirement or payments in case of death of the covered employees.

The amounts recorded for these obligations on the Company's condensed consolidated balance sheets as of March 31, 2025 and December 31, 2024 were $ 690 and $ 613 , respectively, and were included in "Other long-term obligations" on the Company's condensed consolidated balance sheets.

Net periodic benefit costs for such benefit pension plans were as follows:

Three Months Ended March 31,

The amounts recorded for these obligations on the Company's condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024 were $ 773 and $ 613 , respectively, and were included in "Other long-term obligations" on the Company's condensed consolidated balance sheets.

Net periodic benefit costs for such benefit pension plan were as follows:

Six Months Ended June 30,

Service cost with interest to end of year $ 107 $ 37

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Assets of the plan are held in a rabbi trust, and are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company.

The deferred compensation liability was $ 11,653 as of March 31, 2025, of which $ 11,633 was included in "Other long-term obligations" and $ 20 was included in "Accrued compensation and other benefits" on the Company's condensed consolidated balance sheets.

The deferred compensation liability was $ 12,107 as of June 30, 2025, of which $ 12,086 was included in "Other long-term obligations" and $ 21 was included in "Accrued compensation and other benefits" on the Company's condensed consolidated balance sheets.

The deferred compensation liability was $ 11,470 as of December 31, 2024, of which $ 11,449 was included in "Other long-term obligations" and $ 21 was included in "Accrued compensation and other benefits" on the Company’s consolidated balance sheets.

The related assets of the irrevocable trust funds (also known as "rabbi trust funds") were $ 11,642 as of March 31, 2025, of which $ 11,622 was included in "Other non-current assets" and $ 20 was included in "Other current assets" on the Company's condensed consolidated balance sheet.

The related assets of the irrevocable trust funds (also known as "rabbi trust funds") were $ 12,101 as of June 30, 2025, of which $ 12,080 was included in "Other non-current assets" and $ 21 was included in "Other current assets" on the Company's condensed consolidated balance sheet.

The rabbi trust funds were $ 11,465 as of December 31, 2024 and were included in "Other non-current assets" on the Company's consolidated balance sheets.

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The Company is obligated to make rental payments under non-cancelable operating and finance leases.

Aggregate future minimum rental payments required under these leases at March 31, 2025 are disclosed in Note 18, Leases .

Aggregate future minimum rental payments required under these leases at June 30, 2025 are disclosed in Note 18, Leases .

The Company’s Verona, Missouri facility, while held by a prior owner, Syntex Agribusiness, Inc.

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The Company has a number of financial instruments, none of which are held for trading purposes.

The Company estimates that the fair value of all financial instruments at March 31, 2025 and December 31, 2024 does not differ materially from the aggregate carrying values of its financial instruments recorded in the accompanying condensed consolidated balance sheets.

The Company estimates that the fair value of all financial instruments at June 30, 2025 and December 31, 2024 does not differ materially from the aggregate carrying values of its financial instruments recorded in the accompanying condensed consolidated balance sheets.

The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies.

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The Company’s financial instruments also include cash equivalents, accounts receivable, accounts payable, and accrued liabilities, which are carried at cost and approximate fair value due to the short-term maturity of these instruments.

Cash and cash equivalents included $ 1,033 and $ 1,040 , in money market funds as of March 31, 2025 and December 31, 2024, respectively, and $ 11,904 and $ 0 in certificates of deposit with maturities of three months or less at March 31, 2025 and December 31, 2024, respectively.

Cash and cash equivalents included $ 1,432 and $ 1,040 , in money market funds as of June 30, 2025 and December 31, 2024, respectively, and $ 15,267 and $ 0 in certificates of deposit with maturities of three months or less at June 30, 2025 and December 31, 2024, respectively.

The certificates of deposit are categorized in level two of the fair value hierarchy as defined by ASC 820, "Fair Value Measurement".

Due to the short-term nature of the instrument, the Company has determined the cost approximates fair value.

Non-current assets at March 31, 2025 and December 31, 2024 included $ 11,622 and $ 11,465 , respectively, of rabbi trust funds related to the Company's deferred compensation plan.

Non-current assets at June 30, 2025 and December 31, 2024 included $ 12,080 and $ 11,465 , respectively, of rabbi trust funds related to the Company's deferred compensation plan.

The money market and rabbi trust funds are valued using level one inputs, as defined by ASC 820, “Fair Value Measurement.”

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Gabriel CC Company, LLC in this scenario lacks economic substance and therefore the Company does not include them in net sales within the condensed consolidated statements of earnings.

Payments for the services the Company provided amounted to $ 1,127 and $ 1,092 for the three months ended March 31, 2025 and 2024, respectively.

The raw materials purchased and subsequently sold amounted to $ 9,925 and $ 6,332 for the three months ended March 31, 2025 and 2024, respectively.

Payments for the services the Company provided amounted to $ 1,212 and $ 2,339 for the three and six months ended June 30, 2025, respectively, and $ 1,120 and $ 2,212 for the three and six months ended June 30, 2024, respectively.

The raw materials purchased and subsequently sold amounted to $ 10,821 and $ 20,746 for the three and six months ended June 30, 2025, respectively, and $ 7,301 and $ 13,633 for the three and six months ended June 30, 2024, respectively.

These services and raw materials are primarily recorded in cost of goods sold, net of the finished goods received from St.

Gabriel CC Company, LLC of $ 7,918 and $ 4,971 during the three months ended March 31, 2025 and 2024, respectively.

At March 31, 2025 and December 31, 2024, the Company had receivables of $ 3,824 and $ 3,893 , respectively, recorded in accounts receivable from St.

Gabriel CC Company, LLC of $ 8,983 and $ 16,901 during the three and six months ended June 30, 2025, respectively, and $ 5,713 and 10,684 for the three and six months ended June 30, 2024, respectively.

At June 30, 2025 and December 31, 2024, the Company had receivables of $ 4,577 and $ 3,893 , respectively, recorded in accounts receivable from St.

Gabriel CC Company, LLC for services rendered and raw materials sold.

At March 31, 2025 and December 31, 2024, the Company had payables of $ 2,843 and $ 2,831 , respectively, recorded in accounts payable for finished goods received from St.

At June 30, 2025 and December 31, 2024, the Company had payables of $ 3,529 and $ 2,831 , respectively, recorded in accounts payable for finished goods received from St.

Gabriel CC Company, LLC.

The Company had payables in the amount of $ 296 related to non-contractual monies owed to St.

Gabriel CC Company, LLC, recorded in accounts payable as of both March 31, 2025 and December 31, 2024.

In addition, the Company had receivables in the amount of $ 35 related to non-contractual monies owed from St.

Gabriel CC Company, LLC, recorded in other current assets as of March 31, 2025.

Gabriel CC Company, LLC, recorded in accounts payable as of both June 30, 2025 and December 31, 2024.

NOTE 18 – LEASES

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Based on this understanding, the Company elected to use a portfolio approach to discount rates, applying corporate rates to the tranches of leases based on lease terms.

Based on the Company's risk rating, the Company applied the following discount rates for new leases entered into during the first quarter of 2025:

Based on the Company's risk rating, the Company applied the following discount rates for new leases entered into during the second quarter of 2025:

(1) 1 - 2 years, 5.61 % (2) 3 - 4 years, 6.20 % (3) 5 - 9 years, 6.54 % and (4) 10 + years, 7.26 %.

Right of use assets and lease liabilities at March 31, 2025 and December 31, 2024 are summarized as follows:

Right of use assets March 31, 2025 December 31, 2024

Right of use assets and lease liabilities at June 30, 2025 and December 31, 2024 are summarized as follows:

Right of use assets June 30, 2025 December 31, 2024

Operating leases $ 15,655 $ 15,320

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Total $ 17,281 $ 17,050

Lease liabilities - current March 31, 2025 December 31, 2024

Lease liabilities - current June 30, 2025 December 31, 2024

Operating leases $ 3,672 $ 3,134

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Total $ 3,871 $ 3,328

Lease liabilities - non-current March 31, 2025 December 31, 2024

Lease liabilities - non-current June 30, 2025 December 31, 2024

Operating leases $ 12,158 $ 12,967

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Total $ 13,806 $ 14,716

For the three months ended March 31, 2025 and 2024, the Company's total lease costs were as follows, which included amounts recognized in earnings, amounts capitalized on the balance sheets, and the cash flows arising from lease transactions:

For the three and six months ended June 30, 2025 and 2024, the Company's total lease costs were as follows, which included amounts recognized in earnings, amounts capitalized on the balance sheets, and the cash flows arising from lease transactions:

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Operating lease cost $ 1,368 $ 1,351 $ 2,693 $ 2,692

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Right-of-use assets obtained in exchange for new operating lease liabilities, net of right-of-use assets disposed $ 655 $ 766 $ 1,857 $ 1,164

Weighted-average remaining lease term - operating leases 8.84 years 9.25 years

Weighted-average remaining lease term - finance leases 8.12 years 8.86 years

Weighted-average remaining lease term - operating leases 8.76 years 9.17 years 8.76 years 9.17 years

Weighted-average remaining lease term - finance leases 7.86 years 8.65 years 7.86 years 8.65 years

Weighted-average discount rate - operating leases 7.6 % 7.5 % 7.6 % 7.5 %

Weighted-average discount rate - finance leases 5.1 % 5.0 % 5.1 % 5.0 %

Rent expense charged to operations under operating lease agreements for the three months ended March 31, 2025 and 2024 aggregated to approximately $ 1,325 and $ 1,341 , respectively.

Aggregate future minimum rental payments required under all non-cancelable operating and finance leases at March 31, 2025 are as follows:

April 1, 2025 to December 31, 2025 $ 3,900

Rent expense charged to operations under operating lease agreements for the three and six months ended June 30, 2025 aggregated to approximately $ 1,368 and $ 2,693 , respectively, and $ 1,351 and $ 2,692 for the three and six months ended June 30, 2024, respectively.

Aggregate future minimum rental payments required under all non-cancelable operating and finance leases at June 30, 2025 are as follows:

July 1, 2025 to December 31, 2025 $ 2,883

Thereafter 4,341

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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