BWX Technologies, Inc. 10-K

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of BWX Technologies, Inc.: Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of BWX Technologies, Inc. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 23, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Acquisitions – Kinectrics Inc. – Fair Value of Property, Plant and Equipment and Customer Relationships Intangible Asset – Refer to Note 2 to the financial statements Critical Audit Matter Description The assets acquired and liabilities assumed in the Kinectrics Inc. ("Kinectrics") transaction have been recorded at estimates of fair value as determined by management, based on information available and assumptions as to future operations. Of the total assets acquired and liabilities assumed, the Company acquired $175.0 million of property, plant, and equipment and $107.5 million of customer relationships intangible asset. We identified the fair value of the aforementioned property, plant and equipment and customer relationships intangible asset for the Kinectrics Inc. acquisition as a critical audit matter because of the significant estimates and assumptions made by management regarding the asset valuation methodology and discount rate for the customer relationships intangible asset acquired as well as the valuation methodology and the cost to replace or reproduce comparable assets for the property, plant, and equipment acquired. This required a high degree of auditor judgment and an increased extent of effort, including the need 45 Table of Contents to involve our fair value specialists when performing audit procedures to evaluate the reasonableness of the valuation methodologies applied to the property, plant, and equipment and customer relationships intangible asset acquired. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the fair value of property, plant, and equipment and customer relationships intangible asset acquired included the following, among others: • We tested the design and operating effectiveness of controls over management's purchase price allocation procedures, including controls over the methodologies and assumptions used in the fair value for property, plant, and equipment and customer relationships intangible asset, and reviewed the work of management's third-party specialists. • With the assistance of our fair value specialists, we evaluated the reasonableness of the customer relationships intangible asset valuation methodology and discount rate by: ◦ Testing the source information underlying the determination of the discount rate and testing the mathematical accuracy of the calculation. ◦ Developing a range of independent estimates and comparing those to the discount rate selected by management. • With the assistance of our fair value specialists, we evaluated the reasonableness of the property, plant, and equipment valuation methodology and the cost to replace or reproduce comparable assets. We also developed a range of independent estimates and compared to those used by management, including testing the mathematical accuracy of the calculation. • We evaluated the reasonableness of management's forecasted information used in the valuation models, including estimated future EBITDA, by: ◦ Comparing the estimates to historical and actual results; ◦ Evaluating whether the forecasts were consistent with evidence obtained in other areas of the audit; ◦ Comparing the estimates to third-party economic research, industry performance, and peer company performance; ◦ Corroborating assumptions and estimates with internal communications to management and the Board of Directors; and ◦ Testing the accuracy and completeness of certain underlying data used by management. /S/ DELOITTE & TOUCHE LLP Charlotte, North Carolina February 23, 2026 We have served as the Company's auditor since 2009. 46 Table of Contents BWX TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF INCOME Year Ended December 31, 2025 2024 2023 (In thousands, except share and per share amounts) Revenues $ 3,198,425 $ 2,703,654 $ 2,496,309 Costs and Expenses: Cost of operations 2,465,566 2,048,447 1,875,716 Research and development costs 13,867 7,478 7,613 Losses (gains) on asset disposals and impairments, net ( 4,972 ) 4,390 1,034 Selling, general and administrative expenses 394,416 318,663 279,694 Total Costs and Expenses 2,868,877 2,378,978 2,164,057 Equity in Income of Investees 74,911 55,931 50,807 Operating Income 404,459 380,607 383,059 Other Income (Expense): Interest income 3,893 2,554 2,359 Interest expense ( 44,207 ) ( 39,475 ) ( 47,036 ) Other – net 33,975 5,034 ( 16,982 ) Total Other Income (Expense) ( 6,339 ) ( 31,887 ) ( 61,659 ) Income before Provision for Income Taxes 398,120 348,720 321,400 Provision for Income Taxes 68,259 66,422 75,079 Net Income $ 329,861 $ 282,298 $ 246,321 Net Income Attributable to Noncontrolling Interest ( 916 ) ( 357 ) ( 472 ) Net Income Attributable to BWX Technologies, Inc. $ 328,945 $ 281,941 $ 245,849 Earnings per Common Share: Basic: Net Income Attributable to BWX Technologies, Inc. $ 3.59 $ 3.08 $ 2.68 Diluted: Net Income Attributable to BWX Technologies, Inc. $ 3.58 $ 3.07 $ 2.68 Shares used in the computation of earnings per share (Note 17): Basic 91,566,280 91,572,674 91,619,156 Diluted 91,856,013 91,859,732 91,874,537 See accompanying notes to consolidated financial statements. 47 Table of Contents BWX TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Year Ended December 31, 2025 2024 2023 (In thousands) Net Income $ 329,861 $ 282,298 $ 246,321 Other Comprehensive Income (Loss): Currency translation adjustments 31,715 ( 42,404 ) 12,876 Derivative financial instruments: Unrealized gains arising during the period, net of tax provision of $( 187 ), $( 213 ) and $( 247 ), respectively 512 667 717 Reclassification adjustment for gains included in net income, net of tax provision of $ 339 , $ 245 and $ 91 , respectively ( 996 ) ( 734 ) ( 264 ) Benefit obligations: Unrecognized losses arising during the period, net of tax benefit of $ 0 , $ 9 and $ 530 , respectively ( 4,642 ) ( 1,297 ) ( 1,631 ) Recognition of benefit plan costs, net of tax benefit of $( 629 ), $( 344 ) and $( 609 ), respectively 2,610 2,981 2,669 Investments: Unrealized (losses) gains arising during the period, net of tax provision of $( 85 ), $( 11 ) and $( 27 ), respectively ( 60 ) 39 100 Reclassification adjustment for gains included in net income during the period, net of tax provision of $ 80 , $ 0 , and $ 0 ( 300 ) — — Other Comprehensive Income (Loss) 28,839 ( 40,748 ) 14,467 Total Comprehensive Income 358,700 241,550 260,788 Comprehensive Income Attributable to Noncontrolling Interest ( 916 ) ( 357 ) ( 472 ) Comprehensive Income Attributable to BWX Technologies, Inc. $ 357,784 $ 241,193 $ 260,316 See accompanying notes to consolidated financial statements. 48 Table of Contents BWX TECHNOLOGIES, INC. CONSOLIDATED BALANCE SHEETS ASSETS December 31, 2025 2024 (In thousands) Current Assets: Cash and cash equivalents $ 499,779 $ 74,109 Restricted cash and cash equivalents 3,085 2,785 Accounts receivable – trade, net 220,391 99,112 Accounts receivable – other 67,858 53,199 Retainages 46,311 33,667 Contracts in progress 610,315 577,745 Inventories 46,537 40,288 Other current assets 66,078 49,092 Total Current Assets 1,560,354 929,997 Property, Plant and Equipment, Net 1,585,136 1,278,161 Investments 8,243 10,609 Goodwill 500,860 287,362 Deferred Income Taxes 12,275 6,569 Investments in Unconsolidated Affiliates 150,143 99,403 Intangible Assets 329,859 165,325 Other Assets 124,625 92,498 TOTAL ASSETS $ 4,271,495 $ 2,869,924 See accompanying notes to consolidated financial statements. 49 Table of Contents BWX TECHNOLOGIES, INC. CONSOLIDATED BALANCE SHEETS LIABILITIES AND STOCKHOLDERS' EQUITY December 31, 2025 2024 (In thousands, except share and per share amounts) Current Liabilities: Current maturities of long-term debt $ — $ 12,500 Accounts payable 141,289 158,077 Accrued employee benefits 117,641 77,234 Accrued liabilities – other 107,802 65,100 Advance billings on contracts 305,285 161,290 Total Current Liabilities 672,017 474,201 Long-Term Debt 2,015,983 1,042,970 Accumulated Postretirement Benefit Obligation 78,460 16,515 Environmental Liabilities 100,278 94,225 Pension Liability 78,167 82,602 Other Liabilities 93,578 79,007 Total Liabilities 3,038,483 1,789,520 Commitments and Contingencies (Note 10) Stockholders' Equity: Common stock, par value $ 0.01 per share, authorized 325,000,000 shares; issued 128,720,819 and 128,320,295 shares at December 31, 2025 and 2024, respectively 1,288 1,283 Preferred stock, par value $ 0.01 per share, authorized 75,000,000 shares; no shares issued — — Capital in excess of par value 159,884 228,889 Retained earnings 2,523,631 2,287,151 Treasury stock at cost, 37,289,582 and 36,869,498 shares at December 31, 2025 and 2024, respectively ( 1,432,943 ) ( 1,388,432 ) Accumulated other comprehensive income (loss) ( 19,373 ) ( 48,211 ) Stockholders' Equity – BWX Technologies, Inc. 1,232,487 1,080,680 Noncontrolling interest 525 ( 276 ) Total Stockholders' Equity 1,233,012 1,080,404 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 4,271,495 $ 2,869,924 See accompanying notes to consolidated financial statements. 50 Table of Contents BWX TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Common Stock Capital In Excess of Par Value Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Stockholders' Equity Noncontrolling Interest Total Stockholders' Equity Shares Par Value (In thousands, except share and per share amounts) Balance December 31, 2022 127,671,756 $ 1,277 $ 189,263 $ 1,932,970 $ ( 21,930 ) $ ( 1,353,270 ) $ 748,310 $ 45 $ 748,355 Net income — — — 245,849 — — 245,849 472 246,321 Dividends declared ($ 0.92 per share) — — — ( 84,902 ) — — ( 84,902 ) — ( 84,902 ) Currency translation adjustments — — — — 12,876 — 12,876 — 12,876 Derivative financial instruments — — — — 453 — 453 — 453 Defined benefit obligations — — — — 1,038 — 1,038 — 1,038 Available-for-sale investments — — — — 100 — 100 — 100 Exercises of stock options 56,005 2 1,321 — — — 1,323 — 1,323 Shares placed in treasury — — — — — ( 7,592 ) ( 7,592 ) — ( 7,592 ) Stock-based compensation charges 337,760 2 15,894 — — — 15,896 — 15,896 Distributions to noncontrolling interests — — — — — — — ( 567 ) ( 567 ) Balance December 31, 2023 128,065,521 $ 1,281 $ 206,478 $ 2,093,917 $ ( 7,463 ) $ ( 1,360,862 ) $ 933,351 $ ( 50 ) $ 933,301 Net income — — — 281,941 — — 281,941 357 282,298 Dividends declared ($ 0.96 per share) — — — ( 88,707 ) — — ( 88,707 ) — ( 88,707 ) Currency translation adjustments — — — — ( 42,404 ) — ( 42,404 ) — ( 42,404 ) Derivative financial instruments — — — — ( 68 ) — ( 68 ) — ( 68 ) Defined benefit obligations — — — — 1,684 — 1,684 — 1,684 Available-for-sale investments — — — — 40 — 40 — 40 Exercises of stock options 25,243 — 733 — — — 733 — 733 Shares placed in treasury — — — — — ( 27,570 ) ( 27,570 ) — ( 27,570 ) Stock-based compensation charges 229,531 2 21,678 — — — 21,680 — 21,680 Distributions to noncontrolling interests — — — — — — — ( 583 ) ( 583 ) Balance December 31, 2024 128,320,295 $ 1,283 $ 228,889 $ 2,287,151 $ ( 48,211 ) $ ( 1,388,432 ) $ 1,080,680 $ ( 276 ) $ 1,080,404 Net income — — — 328,945 — — 328,945 916 329,861 Dividends declared ($ 0.96 per share) — — — ( 92,465 ) — — ( 92,465 ) — ( 92,465 ) Currency translation adjustments — — — — 31,715 — 31,715 — 31,715 Derivative financial instruments — — — — ( 484 ) — ( 484 ) — ( 484 ) Defined benefit obligations — — — — ( 2,033 ) — ( 2,033 ) — ( 2,033 ) Available-for-sale investments — — — — ( 360 ) — ( 360 ) — ( 360 ) Exercises of stock options 43,011 1 2,527 — — — 2,528 — 2,528 Shares placed in treasury — — — — — ( 44,511 ) ( 44,511 ) — ( 44,511 ) Stock-based compensation charges 357,513 4 26,068 — — — 26,072 — 26,072 Distributions to noncontrolling interests — — — — — — — ( 115 ) ( 115 ) Purchase of capped calls related to convertible senior notes — — ( 97,600 ) — — — ( 97,600 ) — ( 97,600 ) Balance December 31, 2025 128,720,819 $ 1,288 $ 159,884 $ 2,523,631 $ ( 19,373 ) $ ( 1,432,943 ) $ 1,232,487 $ 525 $ 1,233,012 See accompanying notes to consolidated financial statements. 51 Table of Contents BWX TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS Year Ended December 31, 2025 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: (In thousands) Net Income $ 329,861 $ 282,298 $ 246,321 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 109,186 85,862 78,566 Income of investees, net of dividends 19,139 ( 10,598 ) 11,130 Losses (gains) on asset disposals and impairments - net ( 4,972 ) 4,390 1,034 Provision for deferred taxes 49,417 19,845 ( 5,128 ) Recognition of (gains) losses for pension and postretirement plans ( 5,933 ) 14,147 34,087 Stock-based compensation expense 26,072 21,680 15,896 Other, net ( 13,423 ) ( 83 ) ( 1,530 ) Changes in assets and liabilities, net of effects from acquisitions: Accounts receivable ( 80,622 ) ( 47,571 ) 462 Accounts payable ( 23,562 ) 34,532 ( 9,025 ) Retainages ( 12,644 ) 21,514 ( 6,615 ) Contracts in progress and advance billings on contracts 133,604 ( 7,155 ) 28,868 Income taxes ( 29,626 ) 1,650 ( 4,786 ) Accrued and other current liabilities 6,997 865 ( 9,754 ) Pension liabilities, accrued postretirement benefit obligations and employee benefits ( 23,472 ) 881 ( 6,964 ) Other, net ( 174 ) ( 13,829 ) ( 8,861 ) NET CASH PROVIDED BY OPERATING ACTIVITIES 479,848 408,428 363,701 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment ( 184,557 ) ( 153,647 ) ( 151,286 ) Acquisition of businesses ( 535,147 ) — — Purchases of securities — — ( 2,343 ) Sales and maturities of securities 3,397 — 5,996 Investments, net of return of capital, in equity method investees ( 29,676 ) ( 197 ) — Other, net 3,874 ( 717 ) ( 8,009 ) NET CASH USED IN INVESTING ACTIVITIES ( 742,109 ) ( 154,561 ) ( 155,642 ) CASH FLOWS FROM FINANCING ACTIVITIES: Payments of short-term borrowing and long-term debt ( 12,500 ) — — Proceeds from issuance of convertible senior notes 1,250,000 — — Borrowings of long-term debt 1,030,000 456,000 353,100 Repayments of long-term debt ( 1,280,000 ) ( 612,250 ) ( 434,350 ) Payment of debt issuance costs ( 33,494 ) — — Purchase of capped calls related to convertible senior notes ( 131,875 ) — — Repurchases of common stock ( 30,000 ) ( 20,000 ) — Dividends paid to common shareholders ( 92,467 ) ( 88,349 ) ( 84,974 ) Cash paid for shares withheld to satisfy employee taxes ( 13,624 ) ( 7,570 ) ( 7,592 ) Settlements of forward contracts, net 6,267 19,591 3,689 Other, net 1,333 ( 207 ) 756 NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 693,640 ( 252,785 ) ( 169,371 ) EFFECTS OF EXCHANGE RATE CHANGES ON CASH ( 4,746 ) ( 2,126 ) 1,937 TOTAL INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AND CASH EQUIVALENTS 426,633 ( 1,044 ) 40,625 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 80,571 81,615 40,990 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 507,204 $ 80,571 $ 81,615 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 65,163 $ 72,426 $ 63,216 Income taxes (net of refunds) $ 47,892 $ 45,508 $ 84,478 SCHEDULE OF NON-CASH INVESTING ACTIVITY: Accrued capital expenditures included in accounts payable $ 12,295 $ 17,537 $ 7,105 See accompanying notes to consolidated financial statements. 52 Table of Contents BWX TECHNOLOGIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2025 NOTE 1 – BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES We have presented the consolidated financial statements of BWX Technologies, Inc. ("BWXT") in U.S. dollars in accordance with accounting principles generally accepted in the United States ("GAAP"). We use the equity method to account for investments in entities that we do not control, but over which we have the ability to exercise significant influence. We generally refer to these entities as "joint ventures." We have eliminated all intercompany transactions and accounts. We classify assets and liabilities related to long-term contracts as current using the duration of the related contract or program as our operating cycle, which is generally longer than one year. We have recast certain amounts previously reported in our consolidated balance sheets and statements of cash flows to conform to the presentation at December 31, 2025. We present the notes to our consolidated financial statements on the basis of continuing operations, unless otherwise stated. Unless the context otherwise indicates, "we," "us" and "our" mean BWXT and its consolidated subsidiaries. Reportable Segments We operate in two reportable segments: Government Operations and Commercial Operations. Our reportable segments are further described as follows: • Our Government Operations segment manufactures naval nuclear reactors, including the related nuclear fuel, for the U.S. Naval Nuclear Propulsion Program for use in submarines and aircraft carriers. Through this segment, we also fabricate fuel-bearing precision components that range in weight from a few grams to hundreds of tons, manufacture electro-mechanical equipment, perform design, manufacturing, inspection, assembly and testing activities and downblend Cold War-era government stockpiles of high-enriched uranium, develop capabilities related to the manufacture of high-purity depleted uranium, design advanced reactors and manufacture other advanced materials and products for commercial, military and space applications. In addition, we supply proprietary and sole-source valves, manifolds and fittings to global naval and commercial shipping customers. In-house capabilities also include wet chemistry uranium processing, advanced heat treatment to optimize component material properties and a controlled, clean-room environment with the capacity to assemble railcar-size components. This segment also provides various other services, primarily through joint ventures, to the U.S. Government including nuclear materials management and operation, environmental management and administrative and operating services for various U.S. Government-owned facilities. These services are provided to the U.S. Department of Energy ("DOE"), including the National Nuclear Security Administration, the Office of Nuclear Energy, the Office of Science and the Office of Environmental Management, the Department of War (also known as the Department of Defense) and NASA. In addition, this segment also develops technology for advanced nuclear reactors for a variety of power and propulsion applications in the space and terrestrial domains and offers complete advanced nuclear fuel and reactor design and engineering, licensing and manufacturing services for these programs. • Our Commercial Operations segment fabricates commercial nuclear steam generators, nuclear fuel, fuel handling systems, pressure vessels, reactor components, heat exchangers, tooling delivery systems and other auxiliary equipment, including containers for the storage of spent nuclear fuel and other high-level waste and supplies nuclear-grade materials and precisely machined components for nuclear utility customers. We supply the global nuclear industry with large, heavy components and are the only commercial heavy nuclear component manufacturer in North America. This segment also provides specialized engineering services that include structural component design, 3-D thermal-hydraulic engineering analysis, weld and robotic process development, electrical and controls engineering and metallurgy and materials engineering. In addition, this segment offers in-plant inspection, maintenance and modification services for nuclear steam generators, heat exchangers, reactors, fuel handling systems and balance of plant equipment, as well as specialized non-destructive examination and tooling/repair solutions. This segment also offers a broad suite of nuclear power plant lifecycle support and management services for the global industry and transmission and distribution markets. This segment also manufactures medical radioisotopes, radiopharmaceuticals and medical devices, and partners with life science and pharmaceutical companies developing new drugs. See Note 3 and Note 15 for financial information about our segments. 53 Table of Contents Recently Adopted Accounting Standards In December 2023, the Financial Accounting Standards Board ("FASB") issued updates to Topic Income Taxes (hereinafter referred to as "ASU 2023-09") to provide, on an annual basis, disaggregated disclosures with respect to the reconciliation of our effective tax rate, as well as a disaggregation of income taxes paid, net of refunds received. During the year ended December 31, 2025, we adopted the provisions of this update which are included in Note 5. The adoption of these provisions had no impact on our results of operations, financial position or cash flows. Use of Estimates We use estimates and assumptions to prepare our financial statements in conformity with GAAP. Some of our more significant estimates include estimates of costs to complete long-term contracts and the associated revenues, estimates of the fair value of acquired intangible and other assets, estimates we make in selecting assumptions related to the valuations of our pension and postretirement benefit plans, including the selection of our discount rates, mortality and expected rates of return on our pension plan assets and estimates we make in evaluating our asset retirement obligations. These estimates and assumptions affect the amounts we report in our financial statements and accompanying notes. Our actual results could differ from these estimates. Variances could result in a material effect on our financial condition and results of operations in future periods. Contracts and Revenue Recognition We generally recognize contract revenues and related costs over time for individual performance obligations based on a cost-to-cost method in accordance with the FASB Topic Revenue from Contracts with Customers . We recognize estimated contract revenue and resulting income based on the measurement of the extent of progress toward completion as a percentage of the total project. Certain costs may be excluded from the cost-to-cost method of measuring progress, such as significant costs for uninstalled materials, if such costs do not depict our performance in transferring control of goods or services to the customer. We review contract price and cost estimates periodically as the work progresses and reflect adjustments proportionate to the percentage-of-completion in income in the period when those estimates are revised. We recognize revenue on certain cost plus and time and materials contracts equal to the amount we have the right to invoice the customer when performance obligations are satisfied over time and the invoice amount corresponds directly with the value we are providing the customer. Certain of our contracts recognize revenue at a point in time, and revenue on these contracts is recognized when control transfers to the customer. The majority of our revenue that is recognized at a point in time is related to parts and certain medical radioisotopes and radiopharmaceuticals in our Commercial Operations segment. For all contracts, if a current estimate of total contract cost indicates a loss on a contract, the projected loss is recognized in full when determined. See Note 3 for a further discussion of revenue recognition. Stock-Based Compensation We expense stock-based compensation in accordance with FASB Topic Compensation – Stock Compensation. Under this topic, the fair value of equity-classified awards, such as restricted stock, performance shares and stock options, is determined on the date of grant and is not remeasured. The fair value of liability-classified awards, such as cash-settled stock appreciation rights, restricted stock units and performance units, is determined on the date of grant and is remeasured at the end of each reporting period through the date of settlement. Grant date fair values for restricted stock, restricted stock units, performance shares and performance units are determined using the closing price of our common stock on the date of grant. Under the provisions of this FASB topic, we recognize expense for all share-based awards granted on a straight-line basis over the requisite service periods of the awards, which is generally equivalent to the vesting term. This topic requires compensation expense to be recognized only for those awards expected to vest. As a result, we periodically review the number of actual forfeitures and record any adjustments deemed necessary each reporting period. We also recognize excess tax benefits in our provision for income taxes. These excess tax benefits result from tax deductions in excess of the cumulative compensation expense recognized for options exercised and other equity-classified awards. See Note 9 for a further discussion of stock-based compensation. Grant Accounting We recognize amounts related to grants as a reduction of expense in the period in which the related costs for which the grants are intended to compensate are recognized and we are reasonably assured to receive payment. 54 Table of Contents Research and Development Our research and development activities are related to the development and improvement of new and existing products and equipment, as well as conceptual and engineering evaluation for translation into practical applications. Research and development costs are expensed as incurred, unless these costs relate to customer-sponsored activities where we are reimbursed in accordance with the terms of the underlying contracts. Amounts expensed as incurred for company-funded research and development projects are included in research and development costs. Costs related to contracts with customers for customer-sponsored research and development projects are included as a contract cost in Cost of operations whereby we recognize revenue, consistent with our revenue recognition policies. Additionally, we may enter into cost-sharing arrangements with our customers to enhance our internal development capabilities and offset a portion of the costs incurred related to these development efforts. Research and development activities totaled $ 78.2 million, $ 53.7 million and $ 53.0 million in the years ended December 31, 2025, 2024 and 2023, respectively. This includes amounts paid for by our customers of $ 64.4 million, $ 46.2 million and $ 45.4 million in the years ended December 31, 2025, 2024 and 2023, respectively. Capitalization of Interest Cost We capitalize interest in accordance with FASB Topic Interest . We incurred total interest of $ 69.9 million, $ 65.7 million and $ 73.6 million in the years ended December 31, 2025, 2024 and 2023, respectively, of which we capitalized $ 25.7 million, $ 26.3 million and $ 26.6 million in the years ended December 31, 2025, 2024 and 2023, respectively. Income Taxes Income tax expense for federal, foreign, state and local income taxes is calculated on pre-tax income based on current tax law and includes the cumulative effect of any changes in tax rates from those used previously in determining deferred tax assets and liabilities. We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. We assess deferred taxes and the adequacy of the valuation allowance on a quarterly basis. In the ordinary course of business, there is inherent uncertainty in quantifying our income tax positions. We assess our income tax positions and record tax benefits for all years subject to examination based upon management's evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, no tax benefit has been recognized in the financial statements. We record interest and penalties (net of any applicable tax benefit) related to income taxes as a component of Provision for Income Taxes on our consolidated statements of income. We would be subject to withholding taxes if we were to distribute earnings from certain foreign subsidiaries, and unrecognized deferred income tax liabilities, including withholding taxes, would be payable upon distribution of these earnings. We consider the earnings of our non-U.S. subsidiaries to be permanently reinvested. Certain jurisdictions now implement the Organization for Economic Cooperation and Development’s Pillar Two rules regarding a 15% global minimum tax effective January 1, 2024. While it is uncertain whether the U.S. will enact legislation to adopt Pillar Two it had no impact on our provision for income taxes for the year ended December 31, 2025 and we do not currently expect Pillar Two to significantly impact our provision for income taxes in the future. On July 4, 2025, President Trump signed into law an act commonly referred to as the "One Big Beautiful Bill Act". This bill includes a number of tax provisions including extending existing provisions that were set to expire, substantive changes in international tax law rules and the repeal or phase outs of certain energy tax credits. This legislation did not result in a material impact to our results of operations, financial position or cash flows. Earnings Per Share We have computed earnings per common share on the basis of the weighted-average number of common shares, and, where dilutive, common share equivalents, outstanding during the indicated periods. We periodically issue a number of forms of stock-based compensation, including incentive and non-qualified stock options, restricted stock, restricted stock units, performance shares and performance units, subject to satisfaction of specific performance goals. We include the shares applicable to these plans in our computation of diluted earnings per share when related performance criteria have been met. 55 Table of Contents Cash and Cash Equivalents and Restricted Cash and Cash Equivalents Our cash equivalents are highly liquid investments with maturities of three months or less when we purchase them. We record cash and cash equivalents as restricted when we are unable to freely use such cash and cash equivalents for our general operating purposes. At December 31, 2025, we had restricted cash and cash equivalents totaling $ 7.4 million, $ 4.3 million of which was held for future decommissioning of facilities (which is included in Other Assets on our consolidated balance sheets) and $ 3.1 million of which was held to meet reinsurance reserve requirements of our captive insurer. The following table provides a reconciliation of cash and cash equivalents and restricted cash and cash equivalents on our consolidated balance sheets to the totals presented on our consolidated statements of cash flows: December 31, 2025 2024 (In thousands) Cash and cash equivalents $ 499,779 $ 74,109 Restricted cash and cash equivalents 3,085 2,785 Restricted cash and cash equivalents included in Other Assets 4,340 3,677 Total cash and cash equivalents and restricted cash and cash equivalents as presented on our consolidated statements of cash flows $ 507,204 $ 80,571 Investments Our investment portfolio consists primarily of corporate bonds and mutual funds. Our debt securities are carried at fair value and are either classified as trading, with unrealized gains and losses reported in earnings, or as available-for-sale, with the unrealized gains and losses, net of tax, reported as a component of Accumulated other comprehensive income (loss). Our equity securities are carried at fair value with the unrealized gains and losses reported in earnings. We classify investments available for current operations in the consolidated balance sheets as current assets, while we classify investments held for long-term purposes as noncurrent assets. We adjust the amortized cost of debt securities for amortization of premiums and accretion of discounts to maturity, and such adjustments are included in Interest income. We include realized gains and losses on our investments in Other – net. The cost of securities sold is based on the specific identification method. We include interest on investments in Interest income. Inventories We carry our inventory at the lower of cost or net realizable value using either the weighted-average or first-in, first-out methods. At December 31, 2025 and 2024, Other current assets included inventories totaling $ 46.5 million and $ 40.3 million, respectively, consisting entirely of raw materials and supplies. Property, Plant and Equipment We carry our property, plant and equipment at depreciated cost, less any impairment provisions. We depreciate our property, plant and equipment using the straight-line method over estimated economic useful lives of eight to 40 years for buildings and three to 14 years for machinery and equipment. Our depreciation expense was $ 85.9 million, $ 72.9 million and $ 65.6 million for the years ended December 31, 2025, 2024 and 2023, respectively. We expense the costs of maintenance, repairs and renewals that do not materially prolong the useful life of an asset as we incur them. 56 Table of Contents Property, plant and equipment is stated at cost and is set forth below: December 31, 2025 2024 (In thousands) Land $ 54,802 $ 10,608 Buildings 519,901 417,189 Machinery and equipment 1,286,010 1,166,236 Property under construction 693,992 584,539 2,554,705 2,178,572 Less: Accumulated depreciation 969,569 900,411 Property, Plant and Equipment, Net $ 1,585,136 $ 1,278,161 Goodwill Goodwill represents the excess of the cost of our acquired businesses over the fair value of the net assets acquired. We perform testing of goodwill for impairment annually or more frequently whenever events or circumstances indicate the carrying value of goodwill may be impaired. We may elect to perform a qualitative test when we believe that there is sufficient excess fair value over carrying value based on our most recent quantitative assessment, adjusted for relevant events and circumstances that could affect fair value during the current year. If we conclude based on this assessment that it is more likely than not that the reporting unit is not impaired, we do not perform a quantitative impairment test. In all other circumstances, we compare the fair value of a reporting unit to its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying value, no impairment charge is recorded. If the carrying amount of a reporting unit exceeds its fair value, an impairment charge is recorded to goodwill in the amount by which carrying value exceeds fair value. The following summarizes the changes in the carrying amount of Goodwill: Government Operations Commercial Operations Total (In thousands) Balance at December 31, 2023 $ 173,253 $ 123,767 $ 297,020 Translation ( 199 ) ( 9,459 ) ( 9,658 ) Balance at December 31, 2024 $ 173,054 $ 114,308 $ 287,362 Purchase price adjustment 74,699 130,055 204,754 Translation 1,170 7,574 8,744 Balance at December 31, 2025 $ 248,923 $ 251,937 $ 500,860 Investments in Unconsolidated Affiliates We use the equity method of accounting for affiliates in which we are able to exert significant influence. Currently, all of our material investments in affiliates that are not consolidated are recorded using the equity method. Affiliates in which we are unable to exert significant influence are carried at fair value. Intangible Assets Intangible assets are recognized at fair value when acquired. Intangible assets with definite lives are amortized to costs and expenses using the straight-line method over their estimated useful lives and tested for impairment when events or changes in circumstances indicate that their carrying amounts may not be recoverable. Intangible assets with indefinite lives are not amortized and are subject to annual impairment testing. We may elect to perform a qualitative assessment when testing indefinite-lived intangible assets for impairment to determine whether events or circumstances affecting significant inputs related to the most recent quantitative evaluation have occurred, indicating that it is more likely than not that the indefinite-lived intangible asset is impaired. Otherwise, we test indefinite-lived intangible assets for impairment by quantitatively determining the fair value of the indefinite-lived intangible asset and comparing the fair value of the intangible asset to its carrying amount. If the carrying amount of the intangible asset exceeds its fair value, we recognize impairment for the amount of the difference. 57 Table of Contents Our Intangible Assets were as follows: December 31, 2025 2024 2023 (In thousands) Amortized intangible assets: Gross cost: Technical support agreement $ 64,239 $ 61,309 $ 66,562 Customer relationships 191,694 55,394 57,103 Unpatented technology 39,409 37,634 40,540 CNSC class 1B nuclear facility license 24,774 23,644 25,670 Acquired backlog 15,444 13,248 13,882 Patented technology 8,744 694 755 All other 901 765 831 Total $ 345,205 $ 192,688 $ 205,343 Accumulated amortization: Technical support agreement $ ( 20,715 ) $ ( 17,104 ) $ ( 15,676 ) Customer relationships ( 36,858 ) ( 26,029 ) ( 23,649 ) Unpatented technology ( 14,352 ) ( 11,650 ) ( 10,345 ) CNSC class 1B nuclear facility license ( 8,624 ) ( 6,337 ) ( 6,023 ) Acquired backlog ( 13,680 ) ( 9,140 ) ( 7,116 ) Patented technology ( 847 ) ( 508 ) ( 483 ) All other ( 533 ) ( 425 ) ( 371 ) Total $ ( 95,609 ) $ ( 71,193 ) $ ( 63,663 ) Net amortized intangible assets $ 249,596 $ 121,495 $ 141,680 Unamortized intangible assets: NRC category 1 license $ 43,830 $ 43,830 $ 43,830 Kinectrics trade name $ 36,433 $ — $ — The following summarizes the changes in the carrying amount of Intangible Assets: Year Ended December 31, 2025 2024 2023 (In thousands) Balance at beginning of period $ 165,325 $ 185,510 $ 193,612 Acquisitions (Note 2) 179,649 — — Amortization expense ( 20,581 ) ( 11,363 ) ( 11,396 ) Translation 5,466 ( 8,822 ) 3,294 Balance at end of period $ 329,859 $ 165,325 $ 185,510 Estimated amortization expense for the next five fiscal years is as follows (amounts in thousands): Year Ended December 31, Amount 2026 $ 20,344 2027 $ 18,692 2028 $ 17,918 2029 $ 17,829 2030 $ 17,436 58 Table of Contents Leases We lease certain manufacturing facilities, office space and equipment under operating leases with terms of one to 20 years. Certain of the leases include options to renew for periods of one to ten years . We include lease options in our determination of the right-of-use asset and lease liability if it is reasonably certain that we will exercise one or more of the options. Leases with initial terms of 12 months or less are excluded from our right-of-use assets and lease liabilities. Our right-of-use assets are included in Other Assets on our consolidated balance sheets. Our current lease liabilities are included in Accrued liabilities – other , and our noncurrent lease liabilities are included in Other Liabilities on our consolidated balance sheets. We use discount rates based on our incremental borrowing rate as most of our leases do not provide an implicit rate that can be readily determined. During the year ended December 31, 2025, we recognized lease expense of $ 10.7 million, which included $ 1.5 million related to the amortization of favorable lease agreements, and paid cash of $ 9.3 million for our operating leases. During the years ended December 31, 2024 and 2023, we recognized lease expense of $ 7.4 million and $ 7.9 million, respectively. At December 31, 2025, our weighted-average remaining lease term was 10.19 years, and for the purpose of measuring the present value of our lease liabilities, the weighted-average discount rate was 6.39 %. The maturities of our lease liabilities at December 31, 2025 were as follows (amounts in thousands): 2026 $ 9,079 2027 $ 8,011 2028 $ 7,592 2029 $ 5,648 2030 $ 4,855 Thereafter $ 23,895 Total lease payments $ 59,080 Less: Interest $ ( 14,859 ) Present value of lease liabilities (1) $ 44,221 (1) Includes current lease liabilities of $ 8.8 million. At December 31, 2025, our right-of-use assets totaled $ 65.8 million. The difference between our right-of-use assets and lease liabilities primarily resulted from favorable lease agreements related to acquisitions. Warranty Expense We accrue estimated warranty expense, included in Cost of operations on our consolidated statements of income, to satisfy contractual warranty requirements when we recognize the associated revenue on the related contracts. In addition, we record specific provisions or reductions where we expect the actual warranty costs to significantly differ from the accrued estimates. Such changes could have a material effect on our consolidated financial condition, results of operations and cash flows. Included in Accrued liabilities – other on our consolidated balance sheets were accrued warranty expenses totaling $ 7.9 million and $ 6.8 million at December 31, 2025 and 2024, respectively. Deferred Debt Issuance Costs We have included deferred debt issuance costs in the consolidated balance sheets as a direct deduction from the carrying amount of our debt liability. We amortize deferred debt issuance costs as interest expense over the life of the related debt. The following summarizes the changes in the carrying amount of these assets: Year Ended December 31, 2025 2024 2023 (In thousands) Balance at beginning of period $ 7,030 $ 9,078 $ 11,126 Additions 33,494 — — Interest expense (1) ( 4,540 ) ( 2,048 ) ( 2,048 ) Balance at end of period $ 35,984 $ 7,030 $ 9,078 59 Table of Contents (1) Includes the recognition of prior deferred debt issuance costs associated with former debt instruments of $( 1.5 ) million for the year ended December 31, 2025. Pension Plans and Postretirement Benefits We sponsor various defined benefit pension and postretirement benefit plans covering certain employees of our U.S. and Canadian subsidiaries. We utilize actuarial valuations to calculate the cost and benefit obligations of our pension and postretirement benefits. The actuarial valuations utilize significant assumptions in the determination of our benefit cost and obligations, including assumptions regarding discount rates, expected rate of return on plan assets, mortality and health care cost trends. We determine our discount rate based on a yield curve comprising rates of return on high-quality, fixed-income investments currently available and expected to be available during the period to maturity of our pension and postretirement benefit plan obligations. The expected rate of return on plan assets assumption is based on capital market assumptions of the long-term expected returns for the investment mix of assets currently in the portfolio. The expected rate of return on plan assets is determined to be the weighted-average of the nominal returns based on the weightings of the classes within the total asset portfolio. Expected health care cost trends represent expected annual rates of change in the cost of health care benefits and are estimated based on analysis of health care cost inflation. The components of benefit cost related to service cost, interest cost, expected return on plan assets and prior service cost amortization are recorded on a quarterly basis based on actuarial assumptions. In the fourth quarter of each year, or as interim remeasurements are required, we immediately recognize net actuarial gains and losses in earnings as a component of net periodic benefit cost. Recognized net actuarial gains and losses consist primarily of our reported actuarial gains and losses and the difference between the actual return on plan assets and the expected return on plan assets. We recognize the funded status of each plan as either an asset or a liability in the consolidated balance sheets. The funded status is the difference between the fair value of plan assets and the present value of its benefit obligation, determined on a plan-by-plan basis. Our pension plan assets can include assets that are difficult to value. See Note 7 for detailed information regarding our plan assets. Asset Retirement Obligations and Environmental Cleanup Costs We accrue for future decommissioning of our nuclear facilities that will permit the release of these facilities to unrestricted use at the end of each facility's service life, which is a requirement of our licenses from the U.S. Nuclear Regulatory Commission ("NRC") and the Canadian Nuclear Safety Commission ("CNSC"). In accordance with the FASB Topic Asset Retirement and Environmental Obligations, we record the fair value of a liability for an asset retirement obligation in the period in which it is incurred. When we initially record such a liability, we capitalize a cost by increasing the carrying amount of the related long-lived asset. When we acquire a business that has an asset retirement obligation, the asset retirement obligation is recognized at fair value without a corresponding increase to the related long-lived asset. Over time, the liability is accreted to its present value each period and the capitalized cost is depreciated over the useful life of the related asset. Upon settlement of a liability, we will settle the obligation for its recorded amount or incur a gain or loss. This topic applies to environmental liabilities associated with assets that we currently operate and are obligated to remove from service. For environmental liabilities associated with assets that we no longer operate, we have accrued amounts based on the estimated costs of cleanup activities for which we are responsible, net of any cost-sharing arrangements. We adjust the estimated costs as further information develops or circumstances change. Given the long-lived nature of these facilities, we are required to estimate retirement costs that will be incurred in the future, which may extend up to 40 years at the time the asset retirement obligation is established. Due to the significance of the remaining useful life of these facilities, the timing of retirement and future costs for material components of the asset retirement obligations, such as labor and waste disposal fees, could differ from our estimates. An exception to this accounting treatment relates to the work we perform for two facilities for which the U.S. Government is obligated to pay substantially all of the decommissioning costs. 60 Table of Contents Substantially all of our asset retirement obligations relate to the remediation of our nuclear analytical laboratory at our facility in Lynchburg, Virginia and the Nuclear Fuel Services, Inc. ("NFS") facility in Erwin, Tennessee in our Government Operations segment as well as certain facilities in our Commercial Operations segment. The following summarizes the changes in the carrying amount of these liabilities: Year Ended December 31, 2025 2024 2023 (In thousands) Balance at beginning of period $ 81,706 $ 79,541 $ 82,512 Costs incurred ( 868 ) ( 1,172 ) ( 3,471 ) Additions/adjustments 2,724 ( 3,201 ) ( 6,512 ) Accretion 2,928 7,003 6,939 Translation 206 ( 465 ) 73 Balance at end of period (1) $ 86,696 $ 81,706 $ 79,541 (1) Includes current asset retirement obligations of $ 0.2 million, $ 1.1 million and $ 2.3 million at December 31, 2025, 2024 and 2023, respectively. Self-Insurance We have a wholly owned insurance subsidiary that provides employer's liability, general and automotive liability and primary workers' compensation insurance and, from time to time, builder's risk insurance (within certain limits) to our companies. We may also, in the future, have this insurance subsidiary accept other risks that we cannot or do not wish to transfer to outside insurance companies. Included in Other Liabilities on our consolidated balance sheets were reserves for self-insurance totaling $ 4.6 million and $ 4.4 million at December 31, 2025 and 2024, respectively. Loss Contingencies We accrue liabilities for loss contingencies when it is probable that a liability has been incurred and the amount of loss is reasonably estimable. We provide disclosure when there is a reasonable possibility that the ultimate loss will exceed the recorded provision or if such probable loss is not reasonably estimable. Due to the nature of our business, we are, from time to time, involved in investigations, litigation, disputes or claims related to our business activities, as discussed in Note 10. Our losses are typically resolved over long periods of time and are often difficult to assess and estimate due to, among other reasons, the possibility of multiple actions by third parties; the attribution of damages, if any, among multiple defendants; plaintiffs, in most cases involving personal injury claims, do not specify the amount of damages claimed; the discovery process may take multiple years to complete; during the litigation process, it is common to have multiple complex unresolved procedural and substantive issues; the potential availability of insurance and indemnity coverages; the wide-ranging outcomes reached in similar cases, including the variety of damages awarded; the likelihood of settlements for de minimis amounts prior to trial; the likelihood of success at trial; and the likelihood of success on appeal. Consequently, it is possible future earnings could be affected by changes in our assessments of the probability that a loss has been incurred in a material pending litigation against us and/or changes in our estimates related to such matters. Accumulated Other Comprehensive Income (Loss) The components of Accumulated other comprehensive income (loss) included in Stockholders' Equity are as follows: December 31, 2025 2024 (In thousands) Currency translation adjustments $ ( 2,020 ) $ ( 33,735 ) Net unrealized gain on derivative financial instruments 6 490 Unrecognized prior service cost on benefit obligations ( 17,265 ) ( 15,233 ) Net unrealized (loss) gain on available-for-sale investments ( 94 ) 267 Accumulated other comprehensive income (loss) $ ( 19,373 ) $ ( 48,211 ) 61 Table of Contents The amounts reclassified out of Accumulated other comprehensive income (loss) by component and the affected consolidated statements of income line items are as follows: Year Ended December 31, 2025 2024 2023 Accumulated Other Comprehensive Income (Loss) Component Recognized (In thousands) Line Item Presented Realized gain on derivative financial instruments $ 51 $ ( 96 ) $ ( 72 ) Revenues 1,284 1,075 427 Cost of operations 1,335 979 355 Total before tax ( 339 ) ( 245 ) ( 91 ) Provision for Income Taxes $ 996 $ 734 $ 264 Net Income Amortization of prior service cost on benefit obligations $ ( 3,239 ) $ ( 3,325 ) $ ( 3,278 ) Other – net 629 344 609 Provision for Income Taxes $ ( 2,610 ) $ ( 2,981 ) $ ( 2,669 ) Net Income Realized gain on investments $ 380 $ — $ — Other - net $ ( 80 ) $ — $ — Income Taxes $ 300 $ — $ — Net Income Total reclassification for the period $ ( 1,314 ) $ ( 2,247 ) $ ( 2,405 ) Foreign Currency Translation We translate assets and liabilities of our foreign operations into U.S. dollars at current exchange rates, and we translate income statement items at average exchange rates for the periods presented. We record adjustments resulting from the translation of foreign currency financial statements as a component of Accumulated other comprehensive income (loss). We report foreign currency transaction gains and losses in income. We have included in Other – net, transaction gains (losses) of $ 17.7 million, $ 1.7 million and $ 1.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. Derivative Financial Instruments Our operations give rise to exposure to market risks from changes in foreign currency exchange ("FX") rates. We use derivative financial instruments, primarily FX forward contracts, to reduce the impact of changes in FX rates on our operating results. We use these instruments to hedge our exposure associated with revenues or costs on our long-term contracts and other transactions that are denominated in currencies other than our operating entities' functional currencies. We do not hold or issue derivative financial instruments for trading or other speculative purposes. We enter into derivative financial instruments primarily as hedges of certain firm purchase and sale commitments and loans between subsidiaries denominated in foreign currencies. We record these contracts at fair value on our consolidated balance sheets. Based on the hedge designation at inception of the contract, the related gains and losses on these contracts are deferred in stockholders' equity as a component of Accumulated other comprehensive income (loss) until the hedged item is recognized in earnings. The gain or loss on a derivative instrument not designated as a hedging instrument is immediately recognized in earnings. Gains and losses on derivative financial instruments that require immediate recognition are included as a component of Other – net on our consolidated statements of income and are recorded in the statements of cash flows based on the nature and use of the instruments. We have designated the majority of our FX forward contracts that qualify for hedge accounting as cash flow hedges. The hedged risk is the risk of changes in functional-currency-equivalent cash flows attributable to changes in FX spot rates of forecasted transactions primarily related to long-term contracts. We exclude from our assessment of effectiveness the portion of the fair value of the FX forward contracts attributable to the difference between FX spot rates and FX forward rates. At December 31, 2025, we had deferred approximately $ 0.0 million of net gains on these derivative financial instruments. For the years ended December 31, 2025, 2024 and 2023, we recognized (gains) losses of $( 19.0 ) million, $( 38.0 ) million and $ 5.1 million, respectively, in Other – net on our consolidated statements of income associated with FX forward contracts not designated as hedging instruments. 62 Table of Contents At December 31, 2025, our derivative financial instruments consisted of FX forward contracts with a total notional value of $ 246.9 million with maturities extending to April 2028. These instruments consisted primarily of FX forward contracts to purchase or sell Canadian dollars and Euros. We are exposed to credit-related losses in the event of non-performance by counterparties to derivative financial instruments. We attempt to mitigate this risk by using major financial institutions with high credit ratings. Our counterparties to derivative financial instruments have the benefit of the same collateral arrangements and covenants as described under our New Credit Facility. New Accounting and Disclosure Standards In November 2024, the FASB issued updates to Topic Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses . These updates require a public entity to disclose additional information about specific expense categories in the notes to financial statements on an annual and interim basis. The updates are effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. A public entity may apply these amendments on a prospective basis or retrospectively to any or all prior periods presented in the financial statements. We are currently evaluating the impact of the adoption of this standard and expect that it will only require changes to our disclosures with no impact on our results of operations, financial position or cash flows. In September 2025, the FASB issued updates to Topic Intangibles – Goodwill and Other – Internal-Use Software: Targeted Improvements to the Accounting for Internal-Use Software. These updates modernize the accounting for internal-use software by eliminating the sequential development stages currently in use, and modify when an entity is required to begin capitalizing software costs. Furthermore, disclosures for property, plant and equipment will be required for all capitalized software costs. The updates are effective for annual reporting periods beginning after December 15, 2027 and interim reporting periods within those annual reporting periods. Early adoption is permitted. Upon adoption, the updates may be applied prospectively, retrospectively or using a modified transition approach. We are currently evaluating the impact of the adoption of this standard on our financial condition, results of operations, cash flows and disclosures. In December 2025 the FASB issued updates to Topic Government Grants – Accounting for Government Grants Received by Business Entities . These updates add guidance on the recognition, measurement and presentation of government grants where entities historically were required to analogize other existing guidance to determine the appropriate accounting. The FASB largely leveraged this other guidance in these updates. The updates are effective for annual periods beginning after December 15, 2028, including interim periods within those fiscal years with early adoption permitted. We are currently evaluating the impact of the adoption of this standard. NOTE 2 – ACQUISITIONS Aerojet Ordnance Tennessee, Inc. On January 3, 2025, we acquired all of the equity interests of Aerojet Ordnance Tennessee, Inc. ("A.O.T"), a subsidiary of L3Harris Technologies, Inc. for approximately $ 101.1 million, subject to certain working capital adjustments, which reflected a $ 2.2 million reduction in the initial purchase price. A.O.T is a leading provider of advanced special materials which will further enhance our capabilities to develop and manufacture advanced materials and products for commercial, military and space applications. A.O.T. is reported as part of our Government Operations segment. Our purchase price allocation resulted in the recognition of $ 75.0 million of goodwill, $ 27.0 million of intangible assets, and $ 12.7 million of property, plant and equipment. This purchase price allocation reflects a $ 15.0 million increase to Goodwill, primarily related to a revision to our valuation of contract assets and liabilities identified during the three months ended December 31, 2025. As of December 31, 2025, we completed the determination of fair values of the acquired assets and liabilities assumed. The intangible assets included above consist of the following (dollar amounts in thousands): Amount Amortization Period Customer Relationships $ 25,400 6 years Backlog $ 1,600 1 year 63 Table of Contents Kinectrics Inc. On May 20, 2025, we acquired all of the equity interests in Kinectrics Holdings, Inc., the parent company of Kinectrics Inc. ("Kinectrics") for approximately CAD $ 782.7 million subject to certain working capital and other adjustments. This resulted in purchase consideration of CAD $ 614.5 million ($ 440.6 million U.S. dollar equivalent), which is net of assumed pension liabilities, other postretirement benefit obligations and indebtedness. Kinectrics is a leader in providing lifecycle management services for the global nuclear power, transmission and distribution markets and in the production and supply of isotopes for the radiopharmaceutical industry and employs over 1,300 employees located across 20 sites worldwide. Kinectrics is reported as part of our Commercial Operations segment. The fair value assessment of the Kinectrics acquisition is in process as of the filing date of this Form 10-K. The amounts allocated to the assets acquired and liabilities assumed have been determined by management, using estimates of fair value based on information currently available and on current assumptions of future operations. These fair values are subject to change upon the completion of purchase accounting, the impact of which may be material. The estimates of fair value resulted in the recognition of $ 175.0 million of property, plant and equipment, $ 130.1 million of goodwill, $ 151.3 million of intangible assets, $ 39.5 million of investments in unconsolidated affiliates and $ 25.4 million of net working capital, net of acquired pension liabilities and other postretirement benefit obligations totaling $ 90.3 million. This purchase price allocation reflects a $ 18.2 million reduction to goodwill related to the finalization of tax elections made during the three months ended December 31, 2025. The intangible assets included above consist of the following (dollar amounts in thousands): Amount Amortization Period Trade name $ 35,900 Indefinite Developed technology $ 7,900 20 years Customer relationships $ 107,500 20 years NOTE 3 – REVENUE RECOGNITION Contracts and Revenue Recognition Government Operations Our Government Operations segment recognizes revenue over time for the manufacturing of naval nuclear reactor components and fuel, the downblending of high-enriched uranium and the development of advanced nuclear reactors for power and propulsion applications. Certain of our contracts contain two or more different types of components, each of which we identify as a separate performance obligation. We recognize revenue using a cost-to-cost method to measure progress as control is continually transferred to the customer as we incur costs on the performance obligations. We determine the stand-alone selling price of our performance obligations based on the expected cost plus margin approach. We allocate revenue to the individual performance obligations within contracts with multiple performance obligations based on the stand-alone selling price of the individual performance obligations. Our fixed-price incentive fee contracts include incentives that we concluded to be variable consideration. The amount of the variable consideration to which we are entitled is dependent on our actual costs incurred on the performance obligation compared to the target costs for that performance obligation and subject to incentive price revisions included within the contracts. We include these incentive fees in revenue when there is sufficient evidence to determine that the variable consideration is not constrained. The remaining contracts typically have immaterial amounts of variable consideration and have a single performance obligation. Our estimates of variable consideration and total estimated costs at completion are determined through a detailed process based on historical performance and our expertise using the most likely method. Variations from estimated contract performance could result in a material effect on our financial condition and results of operations in future periods. Our Government Operations segment's contracts primarily allow for billings as costs are incurred, subject to certain retainages that require milestones to be reached for the remaining consideration to be paid. Our fuel and downblending contracts allow billing when we achieve certain milestones related to our progress. 64 Table of Contents Commercial Operations Our Commercial Operations segment recognizes revenue over time using a cost-to-cost method for the manufacturing of large components, non-standard parts, fuel bundles and service contracts as control continually transfers to the customers. For standard parts, revenue is recognized at the point in time control transfers to the customer, which is consistent with the transfer of ownership. For medical radioisotopes, we recognize revenue either at the point in time control transfers to the customer or over time using a unit of output method. This segment generates revenue primarily from firm-fixed-price contracts that do not contain variable consideration as well as time-and-materials based contracts. Certain of these contracts contain assurance warranties and/or provisions for liquidated damages, which are expected to have an immaterial impact to the contracts based on our historical experience. We are entitled to payment on the majority of our Commercial Operations segment contracts when we achieve certain milestones related to our progress. Disaggregated Revenues We allocate geographic revenues based on the location of the customers' operations. Revenues by geographic area and customer type were as follows: Year Ended December 31, 2025 Year Ended December 31, 2024 Year Ended December 31, 2023 Government Operations Commercial Operations Total Government Operations Commercial Operations Total Government Operations Commercial Operations Total (In thousands) United States: Government $ 2,199,677 $ 321 $ 2,199,998 $ 2,068,239 $ — $ 2,068,239 $ 1,884,671 $ — $ 1,884,671 Non-Government 123,931 107,395 231,326 86,012 75,954 161,966 123,604 57,654 181,258 $ 2,323,608 $ 107,716 $ 2,431,324 $ 2,154,251 $ 75,954 $ 2,230,205 $ 2,008,275 $ 57,654 $ 2,065,929 Canada: Government $ 3,619 $ — $ 3,619 $ 127 $ — $ 127 $ 245 $ — $ 245 Non-Government 126 684,864 684,990 747 430,385 431,132 778 389,234 390,012 $ 3,745 $ 684,864 $ 688,609 $ 874 $ 430,385 $ 431,259 $ 1,023 $ 389,234 $ 390,257 Other: Government $ 15,731 $ — $ 15,731 $ 12,165 $ — $ 12,165 $ 10,016 $ — $ 10,016 Non-Government 7,006 60,490 67,496 15,750 17,633 33,383 12,023 19,456 31,479 $ 22,737 $ 60,490 $ 83,227 $ 27,915 $ 17,633 $ 45,548 $ 22,039 $ 19,456 $ 41,495 Segment Revenues $ 2,350,090 $ 853,070 3,203,160 $ 2,183,040 $ 523,972 2,707,012 $ 2,031,337 $ 466,344 2,497,681 Eliminations ( 4,735 ) ( 3,358 ) ( 1,372 ) Revenues $ 3,198,425 $ 2,703,654 $ 2,496,309 Revenues by timing of transfer of goods or services were as follows: Year Ended December 31, 2025 Year Ended December 31, 2024 Year Ended December 31, 2023 Government Operations Commercial Operations Total Government Operations Commercial Operations Total Government Operations Commercial Operations Total (In thousands) Over time $ 2,337,024 $ 721,089 $ 3,058,113 $ 2,175,010 $ 439,504 $ 2,614,514 $ 2,012,949 $ 392,060 $ 2,405,009 Point-in-time 13,066 131,981 145,047 8,030 84,468 92,498 18,388 74,284 92,672 Segment Revenues $ 2,350,090 $ 853,070 3,203,160 $ 2,183,040 $ 523,972 2,707,012 $ 2,031,337 $ 466,344 2,497,681 Eliminations ( 4,735 ) ( 3,358 ) ( 1,372 ) Revenues $ 3,198,425 $ 2,703,654 $ 2,496,309 65 Table of Contents Revenues by contract type were as follows: Year Ended December 31, 2025 Year Ended December 31, 2024 Year Ended December 31, 2023 Government Operations Commercial Operations Total Government Operations Commercial Operations Total Government Operations Commercial Operations Total (In thousands) Fixed-Price Incentive Fee $ 894,366 $ 10,334 $ 904,700 $ 1,173,728 $ 17,379 $ 1,191,107 $ 1,218,516 $ 11,119 $ 1,229,635 Firm-Fixed-Price 1,042,344 539,702 1,582,046 590,884 315,061 905,945 469,138 312,236 781,374 Cost-Plus Fee 412,701 7,817 420,518 388,116 — 388,116 337,598 — 337,598 Time-and-Materials 679 295,217 295,896 30,312 191,532 221,844 6,085 142,989 149,074 Segment Revenues $ 2,350,090 $ 853,070 3,203,160 $ 2,183,040 $ 523,972 2,707,012 $ 2,031,337 $ 466,344 2,497,681 Eliminations ( 4,735 ) ( 3,358 ) ( 1,372 ) Revenues $ 3,198,425 $ 2,703,654 $ 2,496,309 Performance Obligations As we progress on our contracts and the underlying performance obligations for which we recognize revenue over time, we refine our estimates of variable consideration and total estimated costs at completion, which impact the overall profitability on our contracts and performance obligations. Changes in these estimates result in the recognition of cumulative catch-up adjustments that impact our revenues and/or costs of contracts. The aggregate impact of changes in estimates increased our revenue and operating income as follows: Year Ended December 31, 2025 2024 2023 (In thousands) Revenues $ 5,544 $ 37,908 $ 24,728 Operating Income (1) $ 4,318 $ 36,770 $ 24,813 (1) During the year ended December 31, 2025, our Government Operations segment results were favorably impacted by material contract adjustments related to a nuclear operations contract. The material adjustments resulted in an increase in revenue and operating income of $ 29.4 million during the year ended December 31, 2025. During the year ended December 31, 2024, no adjustments to any one contract had a material impact on our consolidated financial statements. During the year ended December 31, 2023, our Government Operations segment results were favorably impacted by contract adjustments related to a nuclear operations contract which resulted in an increase in operating income of $ 22.5 million. Our Government Operations segment also recognized favorable adjustments totaling $ 27.9 million as a result of the successful negotiation of change orders related to cost growth that was driven by out-of-scope changes associated with the manufacture of non-nuclear components. 66 Table of Contents Contract Assets and Liabilities We include revenues and related costs incurred, plus accumulated contract costs that exceed amounts invoiced to customers under the terms of the contracts, in Contracts in progress. Costs specific to certain contracts for which we recognize revenue at a point in time are also included in Contracts in progress. We include in Advance billings on contracts billings that exceed accumulated contract costs and revenues and costs recognized over time. In accordance with contract terms, certain amounts that are withheld by our customers and are classified within Retainages. Certain of these amounts require conditions other than the passage of time to be achieved, with the remaining amounts only requiring the passage of time. Most long-term contracts contain provisions for progress payments. Our unbilled receivables do not contain an allowance for credit losses as we expect to invoice customers and collect all amounts for unbilled receivables. Changes in Contracts in progress and Advance billings on contracts are primarily driven by differences in the timing of revenue recognition and billings to our customers. During the year ended December 31, 2025, our unbilled receivables increased $ 35.3 million primarily as a result of decreases in cost in excess of billings on our fixed-price incentive fee contracts and the timing of milestone billings on certain firm-fixed-price contracts within our Government Operations segment, partially offset by increases due to the timing of milestone billings on firm-fixed-price contracts within our Commercial Operations segments. During the year ended December 31, 2025, our Advance billings on contracts increased $ 144.0 million primarily as a result of revenue recognized in excess of billings on certain firm-fixed-price contracts within our Government Operations segment. Certain contracts within our Government Operations segment include provisions that result in an increase in retainages on contracts during the first and third quarters of the year, with larger payments made during the second and fourth quarters. Retainages also vary as a result of timing differences between incurring costs and achieving milestones that allow us to recover these amounts. December 31, December 31, 2025 2024 (In thousands) Included in Contracts in progress: Unbilled receivables $ 594,749 $ 559,415 Retainages $ 46,311 $ 33,667 Advance billings on contracts $ 305,285 $ 161,290 During the years ended December 31, 2025 and 2024, we recognized $ 150.5 million and $ 87.0 million of revenue that was in Advance billings on contracts at the beginning of each year, respectively. Remaining Performance Obligations Remaining performance obligations represent the dollar amount of revenue we expect to recognize in the future from performance obligations on contracts previously awarded and in progress. Our backlog is equal to our remaining performance obligations under contracts that meet the criteria in FASB Topic Revenue from Contracts with Customers . At December 31, 2025, our ending backlog was $ 7,260.7 million, which included $ 2,151.3 million of unfunded backlog related to U.S. Government contracts. We expect to recognize approximately 40 % of the revenue associated with our backlog by the end of 2026, with the remainder to be recognized thereafter. NOTE 4 – EQUITY METHOD INVESTMENTS We have investments in entities that we account for using the equity method. Our share of the undistributed earnings of our equity method investees was $ 29.1 million and $ 40.4 million at December 31, 2025 and 2024, respectively. These amounts are included in Investments in Unconsolidated Affiliates on our consolidated balance sheets. The following tables summarize combined balance sheet and income statement information for investments accounted for under the equity method: 67 Table of Contents December 31, 2025 2024 (In thousands) Current assets $ 691,481 $ 567,185 Noncurrent assets 66 1,302 Total Assets $ 691,547 $ 568,487 Total Liabilities $ 389,212 $ 285,225 Owners' equity 302,335 283,262 Total Liabilities and Owners' Equity $ 691,547 $ 568,487 Year Ended December 31, 2025 2024 2023 (In thousands) Revenues $ 6,564,442 $ 5,864,628 $ 5,334,822 Gross profit $ 231,036 $ 198,616 $ 185,345 Net income $ 231,036 $ 195,256 $ 181,981 Reimbursable costs recorded in revenues by the unconsolidated joint ventures in our Government Operations segment totaled $ 7,164.1 million, $ 5,495.9 million and $ 5,126.6 million for the years ended December 31, 2025, 2024 and 2023, respectively. Income taxes for the investees are the responsibility of the respective owners. Accordingly, no provision for income taxes has been recorded by the investees. Reconciliations of net income per combined income statement information of our investees to equity in income of investees per our consolidated statements of income are as follows: Year Ended December 31, 2025 2024 2023 (In thousands) Equity income based on stated ownership percentages $ 67,148 $ 55,967 $ 50,595 GAAP and other adjustments 7,763 ( 36 ) 212 Equity in income of investees $ 74,911 $ 55,931 $ 50,807 Our transactions with unconsolidated affiliates were as follows: Year Ended December 31, 2025 2024 2023 (In thousands) Sales to $ 21,951 $ 23,068 $ 18,530 Dividends received $ 94,265 $ 45,333 $ 61,937 Capital contributions, net of returns $ 29,677 $ 197 $ — At December 31, 2025 and 2024, Accounts receivable – other included amounts due from unconsolidated affiliates of $ 3.7 million and $ 0.0 million, respectively. NOTE 5 – INCOME TAXES We are subject to federal income tax in the U.S., Canada, and various other jurisdictions., as well as income tax within multiple U.S. state jurisdictions. We provide for income taxes based on the enacted tax laws and rates in the jurisdictions in which we conduct our operations. These jurisdictions may have regimes of taxation that vary with respect to nominal rates and with respect to the basis on which these rates are applied. This variation, along with the changes in our mix of income within these jurisdictions, can contribute to shifts in our effective tax rate from period to period. 68 Table of Contents We are currently under audit by various state and international authorities. We do not have any returns under examination for years prior to 2020. Certain jurisdictions now implement the Organization for Economic Cooperation and Development's (OECD) Pillar Two rules regarding a global minimum tax. As of December 31, 2025, these new rules have not impacted our provision for income taxes. We apply the provisions of FASB Topic Income Taxes regarding the treatment of uncertain tax positions. A reconciliation of unrecognized tax benefits (exclusive of interest and federal and state benefits) is as follows: Year Ended December 31, 2025 2024 (In thousands) Balance at beginning of period (1) $ 21,148 $ — Increases based on tax positions taken in the current year 1,920 2,121 Increases based on tax positions taken in prior years — 19,027 Decreases based on tax positions taken in prior years ( 8,005 ) — Decreases due to settlements with tax authorities — — Decreases due to lapse of applicable statute of limitation — — Other, net — — Balance at end of period $ 15,063 $ 21,148 The unrecognized tax benefits balance of $ 15.1 million at December 31, 2025 would reduce our effective tax rate if recognized. Deferred income taxes reflect the net tax effects of temporary differences between the financial and tax bases of assets and liabilities. Significant components of deferred tax assets and liabilities as of December 31, 2025 and 2024 were as follows: 69 Table of Contents December 31, 2025 2024 (In thousands) Deferred tax assets: Pension liability $ 16,616 $ 17,359 Accrued warranty expense 1,829 1,570 Capitalized Section 174 expenditures 57,870 64,775 Accrued vacation pay 2,721 2,434 Accrued liabilities for executive and employee incentive compensation 22,834 18,736 Environmental and products liabilities 21,220 20,945 Lease liabilities 5,136 5,055 Investments in joint ventures and affiliated companies 3,065 2,746 Convertible debt premium 34,275 — U.S. federal tax credits and loss carryforward 3,399 3,071 U.S. state tax credits and loss carryforward 11,545 10,119 Foreign tax credit and loss carryforward 19,820 23,394 Other 1,145 1,692 Gross deferred tax assets 201,475 171,896 Valuation allowance for deferred tax assets ( 14,939 ) ( 17,039 ) Total deferred tax assets 186,536 154,857 Deferred tax liabilities: Property, plant and equipment 105,046 88,090 Long-term contracts 24,937 54,714 Right-of-use lease assets 10,947 10,590 Accrued liabilities for self-insurance (including postretirement health care benefits) 502 826 Intangibles 58,033 19,589 Total deferred tax liabilities 199,465 173,809 Net deferred tax liabilities $ ( 12,929 ) $ ( 18,952 ) The components of Income before Provision for Income Taxes were as follows: Year Ended December 31, 2025 2024 2023 (In thousands) U.S. $ 295,117 $ 301,018 $ 282,459 Other than U.S. 103,003 47,702 38,941 Income before Provision for Income Taxes $ 398,120 $ 348,720 $ 321,400 70 Table of Contents The components of Provision for Income Taxes were as follows: Year Ended December 31, 2025 2024 2023 (In thousands) Current: U.S. – federal $ 40,026 $ 36,553 $ 69,254 U.S. – state and local 2,683 2,005 4,255 Other than U.S. 10,408 8,019 6,698 Total current 53,117 46,577 80,207 Deferred: U.S. – federal 8,789 15,439 ( 8,968 ) U.S. – state and local ( 122 ) 2,648 ( 376 ) Other than U.S. 6,475 1,758 4,216 Total deferred 15,142 19,845 ( 5,128 ) Provision for Income Taxes $ 68,259 $ 66,422 $ 75,079 The following is a reconciliation of our income tax provision from the U.S. statutory federal tax rate to our consolidated effective tax rate for the year ended December 31, 2025, updated to reflect the adoption of ASU 2023-09: Year Ended December 31, 2025 (In thousands) Income before provision for income taxes $ 398,120 U.S. federal statutory tax rate 83,605 21.0 % State and local income taxes, net of Federal income tax effects (1) 2,561 0.6 % Foreign tax effects Canada - capital loss realization ( 3,654 ) ( 0.9 ) % Other ( 943 ) ( 0.2 ) % Effect of changes in tax laws or rates enacted in the current period — — % Effect of cross-border tax laws 2,574 0.6 % Tax credits U.S. research and development tax credit ( 5,761 ) ( 1.4 ) % Nontaxable or nondeductible items ( 1,051 ) ( 0.3 ) % Changes in unrecognized tax benefits ( 7,934 ) ( 2.0 ) % Other adjustments ( 1,138 ) ( 0.3 ) % Effective tax rate $ 68,259 17.1 % (1) State taxes in Virginia, Tennessee, Ohio, California and New Mexico made up greater than 50% of the tax effect in this category. The following is a reconciliation of our income tax provision from the U.S. statutory federal tax rate to our consolidated effective tax rate as previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09: Year Ended December 31, 2024 2023 U.S. federal statutory tax rate 21.0 % 21.0 % State and local income taxes 1.3 % 1.2 % Research and development tax credit ( 4.0 ) % — % Excess tax deductions on equity compensation ( 0.5 ) % ( 0.3 ) % Other, net 1.2 % 1.5 % Effective tax rate 19.0 % 23.4 % 71 Table of Contents The effective tax rate benefit related to research and development tax credits is presented net of reserves for uncertain tax positions and includes credits corresponding to current year activities, as well as credits corresponding to activities in the prior reporting period. The amounts of cash taxes paid by the Company are as follows: Year Ended December 31, 2025 U.S. – federal $ 30,359 U.S. – state 3,805 Canada 13,618 Other 110 Income taxes, net of amounts refunded $ 47,892 At December 31, 2025, we had a valuation allowance of $ 14.9 million for deferred tax assets, which we expect cannot be realized through carrybacks, future reversals of existing taxable temporary differences and our estimate of future taxable income. We believe that our remaining deferred tax assets are more likely than not realizable through carrybacks, future reversals of existing taxable temporary differences, our estimate of future taxable income and potential tax planning. Any changes to our estimated valuation allowance could be material to our consolidated financial statements. The following is an analysis of our valuation allowance for deferred tax assets: Beginning Balance Charges To Costs and Expenses Charged To Other Accounts Ending Balance (In thousands) Year Ended December 31, 2025 $ ( 17,039 ) $ 5,498 $ ( 3,398 ) $ ( 14,939 ) Year Ended December 31, 2024 $ ( 17,421 ) $ 382 $ — $ ( 17,039 ) Year Ended December 31, 2023 $ ( 13,022 ) $ ( 4,399 ) $ — $ ( 17,421 ) We have federal net operating losses of $ 3.4 million available to offset future taxable income. The federal net operating losses have an indefinite carryforward period. We are carrying a full valuation allowance of $ 3.4 million against the deferred tax asset related to these federal net operating loss carryforwards. We have state credits and state net operating losses of $ 14.6 million ($ 11.5 million net of federal tax benefit) available to offset future taxable income in various states. These state net operating loss carryforwards begin to expire in 2026. We are carrying a full valuation allowance of $ 14.6 million ($ 11.5 million net of federal tax benefit) against the deferred tax asset related to the state credits and state loss carryforwards. We would be subject to withholding taxes if we were to distribute earnings from certain foreign subsidiaries. All of our foreign earnings are considered indefinitely reinvested. Determination of the amount of unrecognized deferred taxes related to these undistributed earnings is not practicable. 72 Table of Contents NOTE 6 – LONG-TERM DEBT Our Long-Term Debt consists of the following: December 31, 2025 2024 (In thousands) Debt Instruments: Convertible Debt $ 1,250,000 $ — Senior Notes 800,000 800,000 Credit Facility — 262,500 Other Debt 1,967 — Less: Amounts due within one year — 12,500 Long-Term Debt, gross 2,051,967 1,050,000 Less: Deferred debt issuance costs 35,984 7,030 Long-Term Debt $ 2,015,983 $ 1,042,970 Maturities of Long-Term Debt subsequent to December 31, 2025 are as follows: 2026 – $ 0.0 million; 2027 – $ 0.0 million; 2028 – $ 400.0 million; 2029 – $ 400.0 million and 2030 and thereafter– $ 1.25 billion. New Credit Facility On November 10, 2025, we entered into a second Amended and Restated Credit Agreement (the "New Credit Facility") with Wells Fargo Bank, National Association, as administrative agent, and the other lenders party thereto, which amended and restated our then-existing secured credit facility (the "Former Credit Facility"), which consisted of a $ 750 million senior secured revolving credit facility (the "Revolving Credit Facility") and a $ 250 million senior secured term A loan (the "Term Loan"). The Revolving Credit Facility and the Term Loan were repaid, in their entirety, with the proceeds from the 2030 Notes as discussed below. The New Credit Facility includes a $ 1.25 billion senior secured revolving credit facility. The proceeds of loans under the New Credit Facility are available for working capital needs, permitted acquisitions and other general corporate purposes. The New Credit Facility is scheduled to mature on November 10, 2030, subject to an early maturity trigger if on any date the aggregate outstanding principal amount of unsecured indebtedness due within 91 days thereof is in excess of 100 % of EBITDA, as defined in the New Credit Facility, for the last four full fiscal quarters. However, this early maturity trigger will not apply if (1) the total Net Leverage Ratio is less than or equal to 2.00 to 1.00 or (2) liquidity is at least 125 % of such outstanding unsecured indebtedness. The Company’s obligations under the New Credit Facility are guaranteed by the same guarantors that guarantee the 2030 Notes. The New Credit Facility is secured by first-priority liens on certain assets owned by the Company and the guarantors (other than its subsidiaries comprising a portion of its Government Operations segment), provided such liens may be released if the Company obtains investment grade ratings of at least BBB- from S&P or Baa3 from Moody's and no default or event of default exists. The New Credit Facility allows for additional parties to become lenders and, subject to certain conditions, for the increase of the commitments under the New Credit Facility, subject to an aggregate maximum for all additional commitments of (1) the greater of (a) $ 600 million and (b) 100 % of EBITDA, as defined in the New Credit Facility, for the last four full fiscal quarters, plus (2) additional amounts provided the Company is in compliance with a pro forma first lien leverage ratio test 3.00 to 1.00 or less. Outstanding loans under the New Credit Facility bear interest at our option at either (i) the Term SOFR rate plus a margin ranging from 1.00 % to 1.75 % per year or (ii) the base rate (the highest of (x) the administrative agent's prime rate, (y) the Federal Funds rate plus 0.50 % and (z) the Term SOFR rate for a one-month tenor plus 1.00 %) plus a margin ranging from 0.0 % to 0.75 % per year. In addition, the Company will be charged (1) a commitment fee of between 0.15 % and 0.225 % per year on the unused portion of the New Credit Facility, (2) a letter of credit fee of between 1.00 % and 1.75 % per year with respect to the amount of each financial letter of credit issued under the New Credit Facility, and (3) a letter of credit fee of between 0.75 % and 1.05 % per year with respect to the amount of each performance letter of credit or commercial letter of credit issued under the New Credit Facility. The applicable margin for loans, the commitment fee and the letter of credit fees set forth above will vary quarterly based on the Company's consolidated total net leverage ratio. 73 Table of Contents The Company may prepay all loans under the New Credit Facility at any time without premium or penalty (other than customary Term SOFR rate breakage costs), subject to notice requirements. The New Credit Facility contains representations and warranties, affirmative and negative covenants and events of default that the Company considers customary for an agreement of this type, including covenants setting a maximum consolidated total net leverage ratio and a minimum consolidated interest coverage ratio. If any event of default relating to bankruptcy or other insolvency events occurs with respect to the Company, the lenders’ commitments under the New Credit Facility will automatically terminate and all outstanding obligations under the New Credit Facility will immediately become due and payable. If any other event of default occurs, the lenders will be permitted to terminate their commitments under the New Credit Facility, accelerate all outstanding obligations under the New Credit Facility and exercise other rights and remedies, including the commencement of foreclosure or other actions against the collateral. Based on the total net leverage ratio applicable at December 31, 2025, the margin for Term SOFR and base rate loans was 1.50 % and 0.50 %, respectively, the letter of credit fee for financial letters of credit and performance letters of credit was 1.50 % and 0.90 %, respectively, and the commitment fee for the unused portion of the New Credit Facility was 0.20 %. The New Credit Facility includes financial covenants that are evaluated on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. The maximum permitted leverage ratio is 4.00 to 1.00, which may be increased to 4.50 to 1.00 for up to four consecutive fiscal quarters after a material acquisition. The minimum consolidated interest coverage ratio is 3.00 to 1.00. In addition, the New Credit Facility contains various restrictive covenants, including with respect to debt, liens, investments, mergers, acquisitions, dividends, equity repurchases and asset sales. As of December 31, 2025, we were in compliance with all covenants set forth in the New Credit Facility. As of December 31, 2025, letters of credit issued under the New Credit Facility totaled $ 1.4 million and we had no outstanding borrowings and had $ 1,248.6 million available under the New Credit Facility for borrowings and to meet letter of credit requirements. The New Credit Facility generally includes customary events of default for a secured credit facility. Under the New Credit Facility, (1) if an event of default relating to bankruptcy or other insolvency events occur with respect to the Company, all related obligations will immediately become due and payable; (2) if any other event of default exists, the lenders will be permitted to accelerate the maturity of the related obligations outstanding; and (3) if any event of default exists, the lenders will be permitted to terminate their commitments thereunder and exercise other rights and remedies, including the commencement of foreclosure or other actions against the collateral. If any default occurs under the New Credit Facility, or if we are unable to make any of the representations and warranties in the New Credit Facility, we will be unable to borrow funds or have letters of credit issued under the New Credit Facility. Senior Notes due 2028 We issued $ 400 million aggregate principal amount of 4.125 % senior notes due 2028 (the "Senior Notes due 2028") pursuant to an indenture dated June 12, 2020 (the "2020 Indenture"), among the Company, certain of our subsidiaries, as guarantors, and U.S. Bank Trust Company, National Association (formerly known as U.S. Bank National Association) ("U.S. Bank"), as trustee. The Senior Notes due 2028 are guaranteed by each of the Company's present and future direct and indirect wholly owned domestic subsidiaries that is a guarantor under the New Credit Facility. Interest on the Senior Notes due 2028 is payable semi-annually in cash in arrears on June 30 and December 30 of each year at a rate of 4.125 % per annum. The Senior Notes due 2028 will mature on June 30, 2028. We may redeem the Senior Notes due 2028, in whole or in part, at any time at a redemption price equal to 100.0 % of the principal amount to be redeemed plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The 2020 Indenture contains customary events of default, including, among other things, payment default, failure to comply with covenants or agreements contained in the 2020 Indenture or the Senior Notes due 2028 and certain provisions related to bankruptcy events. The 2020 Indenture also contains customary negative covenants. As of December 31, 2025, we were in compliance with all covenants set forth in the 2020 Indenture and the Senior Notes due 2028. Senior Notes due 2029 We issued $ 400 million aggregate principal amount of 4.125 % senior notes due 2029 (the "Senior Notes due 2029") pursuant to an indenture dated April 13, 2021 (the "2021 Indenture"), among the Company, certain of our subsidiaries, as 74 Table of Contents guarantors, and U.S. Bank, as trustee. The Senior Notes due 2029 are guaranteed by each of the Company's present and future direct and indirect wholly owned domestic subsidiaries that is a guarantor under the Credit Facility. Interest on the Senior Notes due 2029 is payable semi-annually in cash in arrears on April 15 and October 15 of each year at a rate of 4.125 % per annum. The Senior Notes due 2029 will mature on April 15, 2029. We may redeem the Senior Notes due 2029, in whole or in part, at any time on or after April 15, 2025 at a redemption price equal to (i) 101.031 % of the principal amount to be redeemed if the redemption occurs during the 12-month period beginning on April 15, 2025 and (ii) 100.0 % of the principal amount to be redeemed if the redemption occurs on or after April 15, 2026, in each case plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The 2021 Indenture contains customary events of default, including, among other things, payment default, failure to comply with covenants or agreements contained in the 2021 Indenture or the Senior Notes due 2029 and certain provisions related to bankruptcy events. The 2021 Indenture also contains customary negative covenants. As of December 31, 2025, we were in compliance with all covenants set forth in the 2021 Indenture and the Senior Notes due 2029. 2030 Notes and Capped Call Transactions 2030 Notes In November 2025, the Company issued $ 1.25 billion aggregate principal amount of 0 % Convertible Senior Notes due 2030 (the "2030 Notes"), including the exercise in full of the initial purchasers' option to purchase up to an additional $ 150.0 million principal amount of the 2030 Notes. The 2030 Notes were issued pursuant to an Indenture, dated November 19, 2025 (the "Indenture"), among the Company, certain of our subsidiaries, as guarantors, and U.S. Bank Trust Company, National Association, as trustee. The 2030 Notes are guaranteed by each of the Company's present and future direct and indirect wholly owned domestic subsidiaries that guarantee its existing and future capital markets indebtedness. The conversion rate for the 2030 Notes will initially be 3.8094 shares of common stock per $1,000 principal amount of the 2030 Notes, which is equivalent to an initial conversion price of approximately $ 262.51 per share of common stock. The conversion rate is subject to adjustment upon certain events. Upon conversion, the Company will settle conversions by paying cash up to the aggregate principal amount of the 2030 Notes to be converted and paying or delivering, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the 2030 Notes being converted, based on the applicable conversion rate(s). The 2030 Notes will mature on November 1, 2030, unless earlier converted, redeemed or repurchased. The 2030 Notes will not bear regular interest, and the principal amount of the 2030 Notes will not accrete. However, special interest and additional interest, if any, may accrue on the 2030 Notes at a combined rate per annum not exceeding 0.50 % upon the occurrence of certain events as described in the Indenture. The Company may not redeem the 2030 Notes at its option before November 6, 2028. The Company will have the option to redeem the 2030 Notes, in whole or in part (subject to the partial redemption limitation described below), at any time, and from time to time, on or after November 6, 2028 and before the 26th Scheduled Trading Day (as defined in the Indenture) immediately before the maturity date, at a cash redemption price equal to the principal amount of the 2030 Notes to be redeemed, plus accrued and unpaid special interest and additional interest, if any, to, but excluding, the redemption date, but only if certain conditions are met. On or after August 1, 2030, until the close of business on the second Scheduled Trading Day (as defined in the Indenture) immediately before the maturity date, the 2030 Notes will be convertible at the option of the noteholders at any time. Before August 1, 2030, noteholders will have the right to convert their 2030 Notes only under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ending on March 31, 2026, if the last reported sale price of the Company’s common stock exceeds 130 % of the conversion price for each of at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter; (2) during the five consecutive business days immediately after any ten consecutive trading day period if the trading price per $1,000 principal amount of 2030 Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price per share of common stock on such trading day and the conversion rate on each Trading Day; (3) upon the occurrence of specified corporate events or distributions on the common stock as set forth in the Indenture; or (4) if the Company calls the 2030 Notes for redemption. 75 Table of Contents If the Company undergoes a Fundamental Change (as defined in the Indenture), then, subject to certain exceptions, noteholders may require the Company to repurchase their 2030 Notes in whole or in part for cash at a price equal to the principal amount of the 2030 Notes to be repurchased, plus accrued and unpaid special interest and additional interest, if any, to, but excluding, the Fundamental Change Repurchase Date (as defined in the Indenture). The definition of Fundamental Change includes, among other things, certain business combination transactions involving the Company and certain de-listing events with respect to the common stock. Capped Call Transactions In connection with the pricing of the 2030 Notes and the exercise by the initial purchasers of their option in full to purchase additional 2030 Notes, respectively, the Company paid $ 131.9 million to enter into privately negotiated capped call transactions (the “Capped Call Transactions”) with affiliates of certain of the initial purchasers and certain other financial institutions (the “Option Counterparties”). The Capped Call Transactions have an expiration date of November 1, 2030 but may be redeemed earlier, subject to certain conditions. The Capped Call Transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the 2030 Notes, the number of shares of common stock initially underlying the 2030 Notes. The Capped Call Transactions are expected generally to reduce the potential dilution to the holders of common stock upon any conversion of the 2030 Notes and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted 2030 Notes, as the case may be, with such reduction and or offset subject to a cap. The cap price of the Capped Call Transactions will initially be $ 396.24 per share of common stock, which represents a premium of 100 % over the last reported sale price of the common stock of $ 198.12 per share on November 5, 2025, and is subject to certain adjustments under the terms of the Capped Call Transactions. The Capped Call Transactions are separate transactions (in each case entered into by the Company with the Option Counterparties), are not part of the terms of the 2030 Notes and will not change the holders’ rights under the 2030 Notes. Holders will not have any rights with respect to the Capped Call Transactions. The Capped Call Transactions qualify for a scope exception from derivative accounting for instruments that are both indexed to the issuer's own stock and classified in stockholders' equity on our consolidated balance sheets. The 2030 Notes and the Capped Call Transactions have been integrated for tax purposes. The impact of this tax treatment results in the Capped Call Transactions being deductible with the cost of the Capped Call Transactions qualifying as original issue discount for tax purposes over the term of the 2030 Notes. Other Arrangements We have posted surety bonds to support regulatory and contractual obligations for certain decommissioning responsibilities, projects and legal matters. We utilize surety bond facilities to support such obligations, but the issuance of surety bonds under those facilities is typically at the surety's discretion, and the surety bond facilities generally permit the surety, in its sole discretion, to terminate the facility or demand collateral. Although there can be no assurance that we will maintain our surety bond capacity, we believe our current capacity is adequate to support our existing requirements for the next 12 months. In addition, these surety bonds generally indemnify the beneficiaries should we fail to perform our obligations under the applicable agreements. We, and certain of our subsidiaries, have jointly executed general agreements of indemnity in favor of surety underwriters relating to surety bonds those underwriters issue. As of December 31, 2025, surety bonds issued and outstanding under these arrangements totaled approximately $ 363.0 million. Similarly, we have provided letters of credit and bank guarantees to governmental agencies and contractual counterparties to support regulatory and contractual obligations for certain decommissioning responsibilities, projects and legal matters. We utilize our New Credit Facility and a bilateral letter of credit facility to support such obligations, but the issuance of letters of credit and bank guarantees under our bilateral letter of credit facility is at the issuer's discretion, and our bilateral letter of credit facility generally permits the issuer, in its sole discretion, to demand collateral if the issuer does not otherwise have the benefit of the collateral under our New Credit Facility. On May 14, 2025 we amended our bilateral letter of credit facility to increase the maximum aggregate amount to $ 75 million. Although there can be no assurance that we will maintain our bilateral letter of credit capacity, we believe our current capacity, together with capacity under our New Credit Facility, is adequate to support our existing requirements for the next 12 months. As of December 31, 2025, letters of credit and bank guarantees issued and outstanding under our bilateral letter of credit facility totaled approximately $ 48.7 million, and such letters of credit and bank guarantees are secured by the collateral under our New Credit Facility. 76 Table of Contents NOTE 7 – PENSION PLANS AND POSTRETIREMENT BENEFITS We have historically provided defined benefit retirement benefits, primarily through noncontributory pension plans, for most of our regular employees. Certain of our subsidiaries have made other benefits available to certain groups of employees, including postretirement health care and life insurance benefits. As of 2021, for salaried employees, all major U.S. and Canadian defined benefit retirement plans have been closed to new entrants, and benefit accruals have ceased. For hourly employees, certain defined benefit retirement plans have been closed to new entrants. On May 20, 2025, we completed the acquisition of Kinectrics, inclusive of the Kinectrics Inc. Pension Plan. Through the Kinectrics Inc. Pension Plan, Kinectrics employees are eligible for membership in the plan after completion of three months of continuous service and it is the Company's only defined benefit plan that is open to new participants. Our funding policy is to fund the plans as recommended by the respective plan actuaries and in accordance with the Employee Retirement Income Security Act of 1974, as amended, or other applicable law including the Pension Benefits Act of the Province of Ontario. Assuming we continue as a government contractor, our contractual arrangements with the U.S. Government provide for the recovery of contributions to our pension and other postretirement benefit plans covering employees working primarily in our Government Operations segment. Obligations and Funded Status 77 Table of Contents Pension Benefits Year Ended December 31, Other Benefits Year Ended December 31, 2025 2024 2025 2024 (In thousands) Change in benefit obligation: Benefit obligation at beginning of period $ 892,914 $ 954,369 $ 43,076 $ 43,316 Service cost 13,156 7,523 1,990 384 Interest cost 58,820 45,513 3,948 2,012 Plan participants' contributions 5,340 156 473 396 Amendments 4,642 1,307 — — Acquisitions 453,635 — 61,915 — Settlements — — ( 4,860 ) — Actuarial loss (gain) 36,707 ( 50,535 ) 2,307 835 Foreign currency exchange rate changes 2,028 ( 2,814 ) 435 ( 1,054 ) Benefits paid ( 75,571 ) ( 62,605 ) ( 4,313 ) ( 2,813 ) Benefit obligation at end of period $ 1,391,671 $ 892,914 $ 104,971 $ 43,076 Change in plan assets: Fair value of plan assets at beginning of period $ 818,153 $ 878,942 $ 47,506 $ 47,453 Actual return on plan assets 96,974 271 2,498 1,661 Plan participants' contributions 5,340 156 237 121 Company contributions 32,878 4,611 5,617 1,048 Settlements — — ( 4,860 ) — Acquisitions 421,730 — — — Foreign currency exchange rate changes 23,586 ( 3,222 ) ( 131 ) — Benefits paid ( 75,571 ) ( 62,605 ) ( 4,399 ) ( 2,777 ) Fair value of plan assets at the end of period 1,323,090 818,153 46,468 47,506 Funded status $ ( 68,581 ) $ ( 74,761 ) $ ( 58,503 ) $ 4,430 Amounts recognized in the balance sheet consist of: Prepaid postretirement benefit obligation $ — $ — $ 19,629 $ 22,880 Prepaid pension 12,546 10,663 — — Prepaid (accrued) employee benefits ( 2,960 ) ( 2,822 ) 328 ( 1,935 ) Accumulated postretirement benefit obligation — ( 78,460 ) ( 16,515 ) Pension liability ( 78,167 ) ( 82,602 ) — Accrued benefit liability, net $ ( 68,581 ) $ ( 74,761 ) $ ( 58,503 ) $ 4,430 Amount recognized in accumulated comprehensive income (before taxes): Prior service cost (credit) $ 18,806 $ 17,301 $ 2,578 $ 2,666 Supplemental information: Plans with accumulated benefit obligation in excess of plan assets: Projected benefit obligation $ 1,370,088 $ 872,933 N/A N/A Accumulated benefit obligation $ 1,299,983 $ 871,892 $ 77,034 $ 16,658 Fair value of plan assets $ 1,290,027 $ 787,514 $ — $ 107 Plans with plan assets in excess of accumulated benefit obligation: Projected benefit obligation $ 21,584 $ 19,974 N/A N/A Accumulated benefit obligation $ 21,584 $ 19,974 $ 27,937 $ 26,418 Fair value of plan assets $ 33,063 $ 30,638 $ 46,468 $ 47,399 78 Table of Contents We record the service cost component of net periodic benefit cost within Operating income on our consolidated statements of income. For the years ended December 31, 2025, 2024 and 2023, these amounts were $ 15.1 million, $ 7.9 million and $ 7.9 million, respectively. All other components of net periodic benefit cost are included in Other – net on our consolidated statements of income. For the years ended December 31, 2025, 2024 and 2023, these amounts were $( 15.2 ) million, $( 0.8 ) million and $ 20.9 million, respectively. Components of net periodic benefit cost included in net income are as follows: Pension Benefits Year Ended December 31, Other Benefits Year Ended December 31, 2025 2024 2023 2025 2024 2023 (In thousands) Components of net periodic benefit cost: Service cost $ 13,156 $ 7,523 $ 7,515 $ 1,990 $ 384 $ 338 Interest cost 58,820 45,513 47,638 3,948 2,012 2,139 Expected return on plan assets ( 72,745 ) ( 60,291 ) ( 60,437 ) ( 1,945 ) ( 1,948 ) ( 2,536 ) Amortization of prior service cost 3,152 3,280 3,238 88 45 40 Recognized net actuarial loss (gain) ( 8,362 ) 9,485 31,755 1,811 1,122 ( 946 ) Net periodic benefit cost (income) $ ( 5,979 ) $ 5,510 $ 29,709 $ 5,892 $ 1,615 $ ( 965 ) Net periodic benefit cost related to our pension plans is calculated in accordance with GAAP. In addition, we calculate pension costs in accordance with U.S. cost accounting standards ("CAS") for purposes of cost recovery on our U.S. Government contracts to the extent applicable. See further discussion of CAS pension costs under the heading "Critical Accounting Estimates" in Item 7 of this Annual Report on Form 10-K. Recognized net actuarial losses (gains) consist primarily of our reported actuarial losses (gains), settlements, and the differences between the actual returns on plan assets and the expected returns on plan assets. The benefit obligation of our pension plans as of December 31, 2025 and 2024 increased (decreased) by $ 13.8 million and $( 49.0 ) million, respectively, due to changes in the discount rate. Additional Information Pension Benefits Year Ended December 31, Other Benefits Year Ended December 31, 2025 2024 2025 2024 (In thousands) Decrease in accumulated other comprehensive income due to actuarial losses – before taxes $ ( 3,147 ) $ ( 1,307 ) $ ( 88 ) $ — In the current fiscal year, we have recognized expense in other comprehensive income as a component of net periodic benefit cost of approximately $ 3.2 million and $ 0.1 million for our pension benefits and other benefits, respectively. 79 Table of Contents Assumptions Pension Benefits Other Benefits 2025 2024 2025 2024 Weighted-average assumptions used to determine net periodic benefit obligations at December 31: Discount rate 5.30 % 5.62 % 5.09 % 5.33 % Pension Benefits Other Benefits 2025 2024 2023 2025 2024 2023 Weighted-average assumptions used to determine net periodic benefit cost for the years ended December 31: Discount rate to determine interest cost 5.27 % 4.88 % 5.26 % 4.99 % 4.84 % 5.23 % Expected return on plan assets 6.89 % 7.13 % 7.13 % 4.23 % 4.20 % 5.67 % The expected return on plan assets rate assumptions are based on the long-term expected returns for the investment mix of assets in the portfolio. In setting these rates, we use a building-block approach. Historical real return trends for the various asset classes in the plan's portfolio are combined with anticipated future market conditions to estimate the real rate of return for each asset class. These rates are then adjusted for anticipated future inflation to estimate nominal rates of return for each asset class. The expected rate of return on plan assets is then determined to be the weighted-average nominal return based on the weightings of the asset classes within the total asset portfolio. Our existing other benefit plans are unfunded, with the exception of the NFS postretirement benefit plans. These plans provide health benefits to certain salaried and hourly employees, as well as retired employees, of NFS. All of the assets for these postretirement benefit plans are contributed into a Voluntary Employees' Beneficiary Association trust. 2025 2024 Assumed health care cost trend rates at December 31: Health care cost trend rate assumed for next year 9.00 % 7.50 % Rates to which the cost trend rate is assumed to decline (ultimate trend rate) 4.50 % 4.50 % Year that the rate reaches ultimate trend rate 2038 2037 Investment Goals General The overall investment strategy of the pension trusts is to achieve long-term growth of principal, while avoiding excessive risk and to minimize the probability of loss of principal over the long term. The specific investment goals that have been set for the pension trusts, in the aggregate, are (1) to ensure that plan liabilities are met when due and (2) to achieve an investment return on trust assets consistent with a reasonable level of risk. Allocations to each asset class for both domestic and foreign plans are reviewed periodically and rebalanced, if appropriate, to assure the continued relevance of the goals, objectives and strategies. The pension trusts for both our domestic and foreign plans employ a professional investment advisor and a number of professional investment managers whose individual benchmarks are, in the aggregate, consistent with the plan's overall investment objectives. The goals of each investment manager are (1) to meet (in the case of passive accounts) or exceed (for actively managed accounts) the benchmark selected and agreed upon by the manager and the pension trust and (2) to display an overall level of risk in its portfolio that is consistent with the risk associated with the agreed upon benchmark. The investment performance of total portfolios, as well as asset class components, is periodically measured against commonly accepted benchmarks, including the individual investment manager benchmarks. In evaluating investment manager performance, consideration is also given to personnel, strategy, research capabilities, organizational and business matters, adherence to discipline and other qualitative factors that may impact the ability to achieve desired investment results. 80 Table of Contents Domestic Plans We sponsor the following domestic defined benefit pension plans: • BWXT Retirement Plan; • Nuclear Fuel Services, Inc. Retirement Plan for Salaried Employees; and • Nuclear Fuel Services, Inc. Retirement Plan for Hourly Employees. The assets of the domestic pension plans are commingled for investment purposes and held by the trustee in the BWXT Master Trust (the "Master Trust"). For the years ended December 31, 2025 and 2024, the investment returns on domestic plan assets of the Master Trust (net of deductions for management fees) were approximately 10 % and 0 %, respectively. The following is a summary of the asset allocations for the Master Trust at December 31, 2025 and 2024 by asset category: December 31, 2025 2024 Asset Category: U.S. Government Securities 38 % 33 % Commingled and Mutual Funds 4 % 27 % Real Estate 14 % 14 % Diversified Credit 13 % 14 % Fixed Income (excluding U.S. Government Securities) 7 % 6 % Partnerships with Security Holdings 1 % 2 % Cash and Accrued Items 23 % 4 % Total 100 % 100 % The target allocation for 2026 for the domestic plans, by asset class, is as follows: Asset Class: Fixed Income 56 % Equities 33 % Other 11 % Foreign Plans We sponsor the following foreign defined benefit plans, both of which are in Canada: • BWXT Canada Ltd. Bargaining Unit Employees' Pension Plan; and • Kinectrics Inc. Pension Plan. The assets of the foreign plans are maintained in separate trusts. The following is a summary of the asset allocations of the foreign plans at December 31, 2025 and 2024 by asset category: December 31, 2025 2024 Asset Category: Fixed Income 29 % 60 % Commingled and Mutual Funds 49 % 37 % Cash and Other 22 % 3 % Total 100 % 100 % 81 Table of Contents The target allocation for 2026 for the foreign plans, by asset class, is as follows: Asset Class: Fixed Income 65 % Equities 35 % Fair Value See Note 14 for a detailed description of fair value measurements and the hierarchy established for valuation inputs. The following is a summary of total assets for our plans measured at fair value at December 31, 2025: 12/31/2025 Level 1 Level 2 Level 3 Unclassified (In thousands) Pension and Other Benefits: U.S. Government Securities $ 187,854 $ 187,854 $ — $ — $ — Commingled and Mutual Funds 280,517 10,709 — — 269,808 Real Estate 125,031 — — — 125,031 Diversified Credit 105,421 — — — 105,421 Fixed Income 514,772 317,608 — — 197,164 Partnerships with Security Holdings 99,933 — — — 99,933 Cash, Cash Equivalents and Accrued Items (1) 56,030 — — — 56,030 Total Assets $ 1,369,558 $ 516,171 $ — $ — $ 853,387 (1) Includes items that are not required to be categorized in the fair value hierarchy in order to permit reconciliation of the fair value hierarchy to the fair value of plan assets presented in the Obligations and Funded Status table. The following is a summary of total assets for our plans measured at fair value at December 31, 2024: 12/31/2024 Level 1 Level 2 Level 3 Unclassified (In thousands) Pension and Other Benefits: U.S. Government Securities $ 261,008 $ 261,008 $ — $ — $ — Commingled and Mutual Funds 231,292 42,909 — — 188,383 Fixed Income 107,287 36,277 — — 71,010 Diversified Credit 111,003 — — — 111,003 Real Estate 110,223 — — — 110,223 Partnerships with Security Holdings 14,348 — — — 14,348 Cash, Cash Equivalents and Accrued Items (1) 30,391 — — — 30,391 Total Assets $ 865,552 $ 340,194 $ — $ — $ 525,358 (1) Includes items that are not required to be categorized in the fair value hierarchy in order to permit reconciliation of the fair value hierarchy to the fair value of plan assets presented in the Obligations and Funded Status table. 82 Table of Contents Cash Flows Domestic Plans Foreign Plans Pension Benefits Other Benefits Pension Benefits Other Benefits (In thousands) Expected employer contributions to trusts of defined benefit plans: 2026 $ 2,700 $ 288 $ 10,842 $ 2,379 Expected benefit payments: 2026 $ 66,070 $ 2,241 $ 20,481 $ 2,379 2027 $ 66,960 $ 2,280 $ 21,555 $ 2,631 2028 $ 67,484 $ 2,311 $ 22,918 $ 2,836 2029 $ 67,623 $ 2,336 $ 24,044 $ 3,038 2030 $ 67,523 $ 2,380 $ 24,977 $ 3,200 2031-2035 $ 328,954 $ 11,597 $ 142,363 $ 19,466 Defined Contribution Plans We also provide benefits under the BWXT Retirement Savings Plan (The "Thrift Plan"). The Thrift Plan generally provides for matching employer contributions of 50 % of the first 6 % of compensation, as defined in the Thrift Plan, contributed by participants, and fully vest and are nonforfeitable after three of service or upon retirement, death, lay-off or approved disability. These matching employer contributions are made in cash and invested at the employees' discretion. We also provide service-based cash contributions under the Thrift Plan to employees not accruing benefits under our defined benefit plans. One of our foreign plans includes a defined contribution component whereby we make cash, service-based contributions. Amounts charged to expense for employer contributions under our defined contribution plans totaled approximately $ 43.0 million, $ 47.4 million and $ 41.5 million in the years ended December 31, 2025, 2024 and 2023, respectively. NOTE 8 – CAPITAL STOCK On April 30, 2021, our Board of Directors authorized us to repurchase an indeterminate number of shares of our common stock at an aggregate market value of up to $ 500 million with no expiration date. In the year ended December 31, 2025, repurchased 289,473 shares of our common stock from public market transactions for $ 30 million. In the year ended December 31, 2024, we repurchased 249,442 shares of our common stock from public market transactions for $ 20.0 million. In the year ended December 31, 2023, we did not repurchase any shares of our common stock from public market transactions. As of December 31, 2025, we had approximately $ 347.6 million available to us for share repurchase under the $ 500 million authorization described above. NOTE 9 – STOCK-BASED COMPENSATION BWX Technologies, Inc. 2020 Omnibus Incentive Plan In May 2020, our stockholders approved the 2020 Omnibus Incentive Plan (the "2020 Plan") which succeeded the 2010 Long-Term Incentive Plan of BWX Technologies, Inc. (the "2010 Plan"). Members of the Board of Directors, executive officers, key employees and consultants are eligible to participate in the 2020 Plan. The Compensation Committee of the Board of Directors selects the participants for the 2020 Plan. The 2020 Plan provides for cash awards and equity-based compensation in the form of stock options, restricted stock, restricted stock units, performance shares and performance units, subject to satisfaction of specific performance goals. Shares subject to awards under either the 2020 Plan or the 2010 Plan that are cancelled, forfeited, terminated or expire unexercised, shall immediately become available for the granting of awards under the 2020 Plan. As of the effective date of the 2020 Plan, shares available for grant under the 2010 Plan are available for grant under the 2020 Plan. In addition, our stockholders approved an additional 1,450,000 shares of common stock for issuance through the 2020 Plan. Options to purchase shares are granted at not less than 100 % of the fair market value closing price on the date of grant, become exercisable at such time or times as determined when granted and expire not more than ten years after the date of grant. 83 Table of Contents At December 31, 2025, we had a total of 2,488,351 shares of our common stock available for future awards. In the event of a change in control of the Company, the terms of the awards under the 2020 Plan contain provisions that may cause restrictions to lapse and accelerate the vesting of awards. 2010 Long-Term Incentive Plan of BWX Technologies, Inc. Members of the Board of Directors, executive officers, key employees and consultants were eligible to participate in the 2010 Plan prior to it being succeeded by the 2020 Plan. The Compensation Committee of the Board of Directors selected the participants for the 2010 Plan. The 2010 Plan provided for a number of forms of stock-based compensation, including incentive and non-qualified stock options, restricted stock, restricted stock units, performance shares and performance units, subject to satisfaction of specific performance goals. Shares subject to award under the 2010 Plan that are cancelled, forfeited, terminated or expire unexercised, shall immediately become available for the granting of awards under the 2020 Plan. As part of the approval of the 2010 Plan, 10,000,000 shares of common stock were initially authorized for issuance, with an additional 2,300,000 authorized for issuance in 2014. Options to purchase shares are granted at not less than 100 % of the fair market value closing price on the date of grant, become exercisable at such time or times as determined when granted and expire not more than ten years after the date of grant. Long-Term Incentive Plan of BWXT Technical Services Group, Inc. In June 2012, we established the 2012 Long-Term Incentive Plan of BWXT Technical Services Group, Inc., a cash-settled plan for employees of certain subsidiaries and unconsolidated affiliates as selected by the plan committee. The cash-settled plan provides for a number of forms of stock-based compensation, including stock appreciation rights, restricted stock units and performance units, subject to satisfaction of specific performance goals. Stock appreciation rights are granted at not less than 100 % of the fair market value closing price of a share of BWXT common stock on the date of grant, become exercisable at such time or times as determined when granted and expire not more than ten years after the date of grant. Stock appreciation rights are cash-settled for the excess of the market price of BWXT common stock on the exercise date minus the exercise price. Restricted stock units and performance units are cash-settled upon vesting as determined when granted. We will not issue any shares of BWXT common stock under this plan, as all awards are cash-settled. In the event of a change in control of the Company, the terms of the awards under the cash-settled plan contain provisions that may cause restrictions to lapse and accelerate the vesting of awards. Stock-based compensation expense for all of our plans recognized for the years ended December 31, 2025, 2024 and 2023 totaled $ 26.4 million, $ 21.8 million and $ 16.2 million, respectively, with associated tax benefit totaling $ 4.9 million, $ 3.6 million and $ 2.6 million, respectively. As of December 31, 2025, unrecognized estimated compensation expense related to nonvested awards was $ 22.5 million, which is expected to be recognized over a weighted-average period of 1.7 years. Stock Options The following table summarizes activity for our stock options for the year ended December 31, 2025 (share data in thousands): Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value (In millions) Outstanding at beginning of period 250 $ 74.94 Granted 240 $ 108.65 Exercised ( 43 ) $ 58.73 Cancelled/expired/forfeited ( 20 ) $ 99.00 Outstanding at end of period 427 $ 94.40 8.5 $ 33.6 Exercisable at end of period 95 $ 71.50 7.3 $ 9.6 The aggregate intrinsic value included in the table above represents the total pre-tax intrinsic value that would have been received by the option holders had all option holders exercised their options on December 31, 2025. The intrinsic value is 84 Table of Contents calculated as the total number of option shares multiplied by the difference between the closing price of our common stock on the last trading day of the period and the exercise price of the options. This amount changes based on the price of our common stock. During the years ended December 31, 2025, 2024 and 2023, the total intrinsic value of stock options exercised was $ 4.3 million, $ 1.7 million and $ 2.8 million, respectively. The actual tax benefits realized related to the stock options exercised during the year ended December 31, 2025 totaled $ 0.9 million. Restricted Stock Units Nonvested restricted stock units as of December 31, 2025 and changes during the year ended December 31, 2025 were as follows (share data in thousands): Number of Shares Weighted- Average Grant Date Fair Value Nonvested at beginning of period 160 $ 71.80 Granted 82 $ 111.86 Vested ( 99 ) $ 65.88 Cancelled/forfeited ( 15 ) $ 83.48 Nonvested at end of period 128 $ 100.63 The actual tax benefits realized related to the restricted stock units vested during the year ended December 31, 2025 totaled $ 2.7 million. Performance Shares Nonvested performance shares as of December 31, 2025 and changes during the year ended December 31, 2025 were as follows (share data in thousands): Number of Shares Weighted- Average Grant Date Fair Value Nonvested at beginning of period 575 $ 69.27 Adjustment to assumed vesting percentage 146 $ 109.95 Granted 157 $ 113.51 Vested ( 236 ) $ 45.56 Cancelled/forfeited ( 26 ) $ 99.40 Nonvested at end of period 616 $ 98.18 The actual number of shares in which each participant vests is contingent upon achievement of a mix of certain targets (depending on the grant year), including return on invested capital; earnings before interest, taxes, depreciation and amortization; total shareholder return and diluted earnings per share, over a three-year performance period. The number of shares in which participants can vest ranges from 0 to 200 % of the initial performance shares granted, to be determined upon completion of the three-year performance period. The nonvested shares at the end of the period in the table above assumes weighted-average vesting of 153 %. The actual tax benefits realized related to the performance shares vested during the year ended December 31, 2025 totaled $ 1.5 million. Cash-Settled Awards As of December 31, 2025, we did not have any cash-settled stock appreciation rights, restricted stock units or performance units outstanding. 85 Table of Contents NOTE 10 – COMMITMENTS AND CONTINGENCIES Investigations and Litigation Due to the nature of our business, we are, from time to time, involved in investigations, litigation, disputes or claims related to our business activities, including, among other things: • performance- or warranty-related matters under our customer and supplier contracts and other business arrangements; and • workers' compensation, employment, waste storage and handling, premises liability and other claims. Based upon our prior experience, we do not expect that any of these investigations, litigation proceedings, disputes and claims will have a material adverse effect on our consolidated financial condition, results of operations or cash flows. Environmental Matters We have been identified as a potentially responsible party at various cleanup sites under the Comprehensive Environmental Response, Compensation, and Liability Act, as amended ("CERCLA") and other environmental laws. These laws can impose liability for the entire cost of cleanup on any of the potentially responsible parties, regardless of fault or the lawfulness of the original conduct. Generally, however, where there are multiple responsible parties, a final allocation of costs is made based on the amount and type of wastes disposed of by each party and the number of financially viable parties, although this may not be the case with respect to any particular site. We have not been determined to be a major contributor of wastes to any of these sites. On the basis of the relative contribution of waste to each site by potentially responsible parties, as well as the financial solvency of other potentially responsible parties, we expect our share of the ultimate liability for the various sites will not have a material adverse effect on our consolidated financial condition, results of operations or cash flows in any given year. We perform significant amounts of work for the U.S. Government under both prime contracts and subcontracts and operate certain facilities that are licensed to possess and process special nuclear materials. As a result of these activities, we are subject to continuing reviews by governmental agencies, including the U.S. Environmental Protection Agency and the NRC. We are also involved in manufacturing activities at licensed facilities in Canada that are subject to continuing reviews by governmental agencies in Canada, including the CNSC. The NRC's decommissioning regulations require our Government Operations segment to provide financial assurance that it will be able to pay the expected cost of decommissioning its two licensed facilities at the end of their service lives. We provided financial assurance totaling $ 71.5 million and $ 68.1 million during the years ended December 31, 2025 and 2024, respectively, with surety bonds for the ultimate decommissioning of these licensed facilities. These facilities have provisions in their government contracts pursuant to which substantially all of our decommissioning costs and financial assurance obligations are covered by the DOE, including the costs to complete the decommissioning projects underway at the facility in Erwin, Tennessee. The surety bonds noted above are to cover decommissioning required pursuant to work not subject to this DOE obligation. In Canada, the CNSC's decommissioning regulations require our Commercial Operations segment to provide financial assurance that it will be able to pay the expected cost of decommissioning its CNSC-licensed facilities at the end of their service lives. We provided financial assurance totaling $ 32.5 million and $ 28.5 million during the years ended December 31, 2025 and 2024, respectively, with letters of credit and surety bonds for the ultimate decommissioning of these licensed facilities. Our compliance with federal, foreign, state and local environmental control and protection regulations resulted in pre-tax charges of approximately $ 20.3 million, $ 22.7 million and $ 20.0 million in the years ended December 31, 2025, 2024 and 2023, respectively. In addition, compliance with existing environmental regulations necessitated capital expenditures of $ 1.2 million, $ 0.8 million and $ 0.7 million in the years ended December 31, 2025, 2024 and 2023, respectively. At December 31, 2025 and 2024, we had total environmental accruals (including asset retirement obligations) of $ 107.2 million and $ 103.4 million, respectively. Of our total environmental accruals at December 31, 2025 and 2024, $ 6.9 million and $ 9.2 million, respectively, were included in current liabilities . Inherent in the estimates of these accruals are our expectations regarding the levels of contamination, decommissioning costs and recoverability from other parties, which may vary significantly as decommissioning activities progress. Accordingly, changes in estimates could result in material adjustments to our operating results, and the ultimate loss may differ materially from the amounts that we have provided for in our consolidated financial statements. 86 Table of Contents NOTE 11 – RISKS AND UNCERTAINTIES Revenue Recognized Over Time As of December 31, 2025, in accordance with the method of recognizing revenue over time, we have provided for our estimated costs to complete all of our ongoing contracts. However, it is possible that current estimates could change due to unforeseen events, which could result in adjustments to overall contract costs. The risk on fixed-price contracts is that revenue from the customer does not cover increases in our costs. It is possible that current estimates could materially change for various reasons, including, but not limited to, fluctuations in forecasted labor productivity or steel and other raw material prices. Increases in costs on our fixed-price contracts could have a material adverse impact on our consolidated financial condition, results of operations and cash flows. Alternatively, reductions in overall contract costs at completion could materially improve our consolidated financial condition, results of operations and cash flows. Insurance Upon the February 22, 2006 effectiveness of the settlement relating to the Chapter 11 proceedings involving several of our former subsidiaries, most of our subsidiaries contributed substantial insurance rights to the asbestos personal injury trust, including rights to (1) certain pre-1979 primary and excess insurance coverages and (2) certain of our 1979-1986 excess insurance coverage. These insurance rights provided coverage for, among other things, asbestos and other personal injury claims, subject to the terms and conditions of the policies. The contribution of these insurance rights was made in exchange for the agreement on the part of the representatives of the asbestos claimants, including the representative of future claimants, to the entry of a permanent injunction, pursuant to Section 524(g) of the U.S. Bankruptcy Code, to channel to the asbestos trust all asbestos-related general liability claims against our subsidiaries and former subsidiaries arising out of, resulting from or attributable to their operations, and the implementation of related releases and indemnification provisions protecting those subsidiaries and their affiliates from future liability for such claims. Although we are not aware of any significant, unresolved claims against our subsidiaries and former subsidiaries that are not subject to the channeling injunction and that relate to the periods during which such excess insurance coverage related, with the contribution of these insurance rights to the asbestos personal injury trust, it is possible that we could have underinsured or uninsured exposure for non-derivative asbestos claims or other personal injury or other claims that would have been insured under these coverages had the insurance rights not been contributed to the asbestos personal injury trust. On June 30, 2015, we completed the spin-off of our former Power Generation business (the "spin-off") into an independent, publicly traded company named Babcock & Wilcox Enterprises, Inc. ("BWE"). In conjunction with the spin-off, claims and liabilities associated with the asbestos personal injury, property damage and indirect property damage claims mentioned above have been expressly assumed by BWE pursuant to the master separation agreement between us and BWE. NOTE 12 – FINANCIAL INSTRUMENTS WITH CONCENTRATIONS OF CREDIT RISK The primary customer of our Government Operations segment is the U.S. Government, including some of its contractors. Our Commercial Operations segment's major customers are large utilities. These concentrations of customers may impact our overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic or other conditions. In the years ended December 31, 2025, 2024 and 2023, U.S. Government contracts accounted for approximately 68 %, 76 % and 75 % of our total consolidated revenues, respectively. Accounts receivable due directly or indirectly from the U.S. Government represented 28 % and 40 % of net receivables at December 31, 2025 and 2024, respectively. In the years ended December 31, 2025, 2024 and 2023, revenues from four large utility customers accounted for approximately 17 %, 14 % and 14 % of our total consolidated revenues, respectively. Accounts receivable due directly from four large utility customers represented 50 % and 19 % of net receivables at December 31, 2025 and 2024, respectively. See Note 15 for additional information about our major customers. We believe that our provision for possible losses on uncollectable accounts receivable is adequate for our credit loss exposure. At December 31, 2025 and 2024, the allowances for possible losses that we deducted from Accounts receivable – trade, net on our consolidated balance sheets were $ 0.6 million and $ 0.3 million, respectively. 87 Table of Contents NOTE 13 – INVESTMENTS The following is a summary of our investments at December 31, 2025: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (In thousands) Equity securities Mutual funds $ 6,945 $ 1,298 $ — $ 8,243 Total $ 6,945 $ 1,298 $ — $ 8,243 The following is a summary of our investments at December 31, 2024: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (In thousands) Equity securities Mutual funds $ 7,699 $ 1,076 $ — $ 8,775 Available-for-sale securities Corporate bonds 1,479 355 — 1,834 Total $ 9,178 $ 1,431 $ — $ 10,609 NOTE 14 – FAIR VALUE MEASUREMENTS FASB Topic Fair Value Measurements and Disclosures defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. This topic also sets forth the disclosure requirements regarding fair value and establishes a hierarchy for valuation inputs that emphasizes the use of observable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy established by this topic is as follows: • Level 1 – inputs are based upon quoted prices for identical instruments traded in active markets. • Level 2 – inputs are based upon quoted prices for similar instruments in active markets, quoted prices for similar or identical instruments in inactive markets and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets and liabilities. • Level 3 – inputs are generally unobservable and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models and similar valuation techniques. In accordance with FASB Topic Fair Value Measurements , certain investments that were measured at net asset value per share (or its equivalent) ("NAV") have not been classified in the fair value hierarchy. These investments are measured on the fair value of the underlying investments but may not be redeemable at that fair value. Certain of these investments are subject to customary redemption notice periods of up to 90 days. When appropriate, we adjust these net asset values for contributions and distributions, if any, made during the period beginning on the latest NAV valuation date and ending on our measurement date. We also consider available market data, relevant index returns, preliminary estimates from our investees and other data obtained through research and consultation with third-party advisors in determining the fair value of these investments. The following sections describe the valuation methodologies we use to measure the fair values of our investments, derivatives and nonrecurring fair value measurements. 88 Table of Contents Investments Investments primarily include corporate bonds and mutual funds. In general, and where applicable, we principally use a composite of observable prices and quoted prices in active markets for identical assets or liabilities to determine fair value. This pricing methodology applies to our Level 1 and Level 2 investments. Fair Value Measurements The following is a summary of our investments measured at fair value at December 31, 2025: 12/31/2025 Level 1 Level 2 Level 3 Unclassified (In thousands) Equity securities Mutual funds $ 8,243 $ — $ 8,243 $ — $ — Total $ 8,243 $ — $ 8,243 $ — $ — The following is a summary of our investments measured at fair value at December 31, 2024: 12/31/2024 Level 1 Level 2 Level 3 Unclassified (In thousands) Equity securities Mutual funds $ 8,775 $ — $ 8,775 $ — $ — Available-for-sale securities Corporate bonds 1,834 1,834 — — — Total $ 10,609 $ 1,834 $ 8,775 $ — $ — Derivatives Level 2 derivative assets and liabilities currently consist of FX forward contracts. Where applicable, the value of these derivative assets and liabilities is computed by discounting the projected future cash flow amounts to present value using market-based observable inputs, including FX forward and spot rates, interest rates and counterparty performance risk adjustments. At December 31, 2025 and 2024, we had FX forward contracts outstanding to purchase or sell foreign currencies, primarily Canadian dollars and Euros, with a total fair value of $ 5.2 million and $ 8.2 million, respectively. Other Financial Instruments We used the following methods and assumptions in estimating our fair value disclosures for our other financial instruments: Cash and cash equivalents and restricted cash and cash equivalents . The carrying amounts that we have reported in the accompanying consolidated balance sheets for Cash and cash equivalents and Restricted cash and cash equivalents approximate their fair values due to their highly liquid nature. Long-term and short-term debt . We base the fair values of debt instruments, including our Senior Notes, on quoted market prices. Where quoted prices are not available, we base the fair values on the present value of future cash flows discounted at estimated borrowing rates for similar debt instruments or on estimated prices based on current yields for debt issues of similar quality and terms. At December 31, 2025 and 2024, the fair value of our Senior Notes due 2028 was $ 392.9 million and $ 374.6 million, respectively. At December 31, 2025 and 2024, the fair value of our Senior Notes due 2029 was $ 389.3 million and $ 371.9 million, respectively. At December 31, 2025, the fair value of our 2030 Notes was $ 1.194 billion. The fair value of our remaining debt instruments approximated their carrying values at December 31, 2025 and 2024. Note receivable. Included in Other Assets is a note receivable related to a third-party loan. We base the fair value of this level 2 note receivable instrument on the present value of future cash flows discounted at market interest rates for financial instruments with similar quality and terms. At December 31, 2025, the carrying value of our note receivable was $ 6.4 million and approximated its fair value. 89 Table of Contents NOTE 15 – SEGMENT REPORTING As described in Note 1, our operations are assessed based on two reportable segments. The operations of our segments are managed separately, and each segment has unique technology, services and customer classes. We account for intersegment sales at prices that we generally establish by reference to similar transactions with unaffiliated customers. Reportable segments are measured based on operating income exclusive of general corporate expenses and gains (losses) on sales of corporate assets. Segment operating income is derived directly from our internal management reporting system and the accounting policies that we use to derive segment operating income are identical to those the consolidated company uses. Information about our Segments: Year Ended December 31, 2025 2024 2023 (In thousands) REVENUES: Government Operations $ 2,350,090 $ 2,183,040 $ 2,031,337 Commercial Operations 853,070 523,972 466,344 Eliminations ( 4,735 ) ( 3,358 ) ( 1,372 ) $ 3,198,425 $ 2,703,654 $ 2,496,309 SEGMENT EXPENSES: Government Operations: Research and Development Costs $ 8,360 $ 6,306 $ 6,459 Losses (Gains) on Asset Disposals and Impairments, Net ( 4,973 ) 2,462 1,043 Other Segment Expenses (1) 2,024,680 1,852,328 1,699,960 2,028,067 1,861,096 1,707,462 Commercial Operations: Research and Development Costs $ 5,507 $ 1,172 $ 1,154 Losses (Gains) on Asset Disposals and Impairments, Net 1 57 ( 9 ) Other Segment Expenses (1) 792,102 475,927 427,667 797,610 477,156 428,812 Total Segment Expenses $ 2,825,677 $ 2,338,252 $ 2,136,274 OPERATING INCOME: Government Operations $ 394,850 $ 377,875 $ 374,682 Commercial Operations 57,728 46,816 37,532 452,578 424,691 412,214 Unallocated Corporate (2) ( 48,119 ) ( 44,084 ) ( 29,155 ) Total Operating Income (3) $ 404,459 $ 380,607 $ 383,059 Other Income (Expense) ( 6,339 ) ( 31,887 ) ( 61,659 ) Income before Provision for Income Taxes $ 398,120 $ 348,720 $ 321,400 (1) Other segment expenses include the total cost of operations and selling, general and administrative expenses. (2) Unallocated Corporate includes general corporate overhead not allocated to segments in addition to losses on asset disposals and impairments, net. In the years ended December 31, 2025, 2024 and 2023, Unallocated Corporate includes losses (gains) on asset disposals and impairments, net of $ 0.0 million, $ 1.9 million and $ 0.0 million, respectively. (3) The following amounts are included in Operating Income: Equity in Income of Investees : Government Operations $ 72,642 $ 55,931 $ 50,807 Commercial Operations 2,269 — — $ 74,911 $ 55,931 $ 50,807 90 Table of Contents Year Ended December 31, 2025 2024 2023 (In thousands) CAPITAL EXPENDITURES: Government Operations $ 98,445 $ 81,063 $ 91,699 Commercial Operations 77,081 62,773 53,358 Segment Capital Expenditures 175,526 143,836 145,057 Corporate Capital Expenditures 9,031 9,811 6,229 Total Capital Expenditures $ 184,557 $ 153,647 $ 151,286 DEPRECIATION AND AMORTIZATION: Government Operations $ 75,202 $ 61,027 $ 53,388 Commercial Operations 26,801 17,708 17,745 Segment Depreciation and Amortization 102,003 78,735 71,133 Corporate Depreciation and Amortization 7,183 7,127 7,433 Total Depreciation and Amortization $ 109,186 $ 85,862 $ 78,566 Information about our Product and Service Lines: Year Ended December 31, 2025 2024 2023 (In thousands) REVENUES: Government Operations: Nuclear Components and Fuel $ 1,796,395 $ 1,692,218 $ 1,610,183 Uranium Processing and Nuclear Services 406,557 287,014 276,690 Advanced Reactor Design and Engineering 147,138 203,808 144,464 2,350,090 2,183,040 2,031,337 Commercial Operations: Nuclear Manufacturing 429,223 288,772 231,944 Nuclear Services and Engineering 423,847 235,200 234,400 853,070 523,972 466,344 Eliminations ( 4,735 ) ( 3,358 ) ( 1,372 ) $ 3,198,425 $ 2,703,654 $ 2,496,309 Information about our Consolidated Operations in Different Geographic Areas: December 31, 2025 2024 2023 (In thousands) NET PROPERTY, PLANT AND EQUIPMENT: United States $ 870,374 $ 813,352 $ 784,062 Canada 701,723 462,593 442,755 All Other Countries 13,039 2,216 1,703 $ 1,585,136 $ 1,278,161 $ 1,228,520 See Note 3 for revenues by geographic area for each of our segments. 91 Table of Contents Information about our Major Customers: In the years ended December 31, 2025, 2024 and 2023, sales to the U.S. Government accounted for approximately 91 %, 95 % and 93 % of our Government Operations segment revenues, respectively. In the years ended December 31, 2025, 2024 and 2023, sales to large utility customers accounted for approximately 63 %, 71 % and 77 % of our Commercial Operations segment revenues, respectively. Evaluation of segment performance: Our Chief Operating Decision Maker (the "CODM") is the Company's President and Chief Executive Officer. Our CODM measures the performance of each segment based on several metrics, including revenue and operating income and uses these results, in part, to evaluate the performance of and to allocate resources to each segment. Our CODM does not use assets by segment to evaluate segment performance or allocate resources. Consequently, we do not disclose assets by segment. NOTE 16 – QUARTERLY FINANCIAL DATA (UNAUDITED) The following tables set forth selected unaudited quarterly financial information for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 Quarter Ended March 31, 2025 June 30, 2025 September 30, 2025 December 31, 2025 (In thousands, except per share amounts) Revenues $ 682,258 $ 764,039 $ 866,286 $ 885,842 Operating income (1) $ 96,630 $ 102,424 $ 113,349 $ 92,056 Equity in income of investees $ 16,588 $ 18,545 $ 21,216 $ 18,562 Net Income Attributable to BWX Technologies, Inc. $ 75,462 $ 78,388 $ 82,106 $ 92,989 Earnings per common share: Basic: Net Income Attributable to BWX Technologies, Inc. $ 0.82 $ 0.86 $ 0.90 $ 1.02 Diluted: Net Income Attributable to BWX Technologies, Inc. $ 0.82 $ 0.85 $ 0.89 $ 1.01 (1) Includes equity in income of investees. In the quarter ended June 30, 2025, we recognized favorable contract adjustments totaling $ 29.4 million related to a nuclear operations contract. Year Ended December 31, 2024 Quarter Ended March 31, 2024 June 30, 2024 September 30, 2024 December 31, 2024 (In thousands, except per share amounts) Revenues $ 603,966 $ 681,465 $ 671,956 $ 746,267 Operating income (1) $ 92,961 $ 98,806 $ 96,578 $ 92,262 Equity in income of investees $ 13,203 $ 11,584 $ 15,532 $ 15,612 Net Income Attributable to BWX Technologies, Inc. $ 68,468 $ 72,972 $ 69,483 $ 71,018 Earnings per common share: Basic: Net Income Attributable to BWX Technologies, Inc. $ 0.75 $ 0.80 $ 0.76 $ 0.78 Diluted: Net Income Attributable to BWX Technologies, Inc. $ 0.75 $ 0.79 $ 0.76 $ 0.77 (1) Includes equity in income of investees. We immediately recognize actuarial gains (losses) for our pension and postretirement benefit plans in earnings as a component of net periodic benefit cost. Recorded in the quarters ended December 31, 2025 and 2024, the effects of these adjustments on pre-tax income were $ 6.6 million and $( 10.6 ) million, respectively. 92 Table of Contents NOTE 17 – EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, 2025 2024 2023 (In thousands, except shares and per share amounts) Basic: Net Income Attributable to BWX Technologies, Inc. $ 328,945 $ 281,941 $ 245,849 Weighted-average common shares 91,566,280 91,572,674 91,619,156 Basic earnings per common share $ 3.59 $ 3.08 $ 2.68 Diluted: Net Income Attributable to BWX Technologies, Inc. $ 328,945 $ 281,941 $ 245,849 Weighted-average common shares (basic) 91,566,280 91,572,674 91,619,156 Effect of dilutive securities: Stock options, restricted stock units and performance shares (1) 289,733 287,058 255,381 Adjusted weighted-average common shares 91,856,013 91,859,732 91,874,537 Diluted earnings per common share $ 3.58 $ 3.07 $ 2.68 (1) At December 31, 2025, 2024 and 2023, we excluded 12,156 , 64,575 and 6,089 shares, respectively, from our diluted share calculation as their effect would have been antidilutive. 93 Table of Contents Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.