What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-06 compared with 2025-11-05 · 66 added, 165 removed, 108 unchanged (68% of the section changed)

3 unchanged sentences

Investors can identify forward-looking statements by the use of terms such as “believes,” “contemplates,” “expects,” “may,” “could,” “should,” “would,” or “anticipates,” other similar phrases, or the negatives of these terms.

References herein to “Crane NXT,” “we,” “us” and “our” refer to Crane NXT, Co.

and its subsidiaries, including when Crane NXT, Co.

was named “Crane Holdings, Co.” unless the context implies otherwise.

References herein to “Holdings” refer to Crane Holdings, Co.

and its subsidiaries prior to the consummation of the Separation unless the context implies otherwise.

On April 3, 2023, Holdings was separated (the “Separation”) into two independent, publicly-traded companies, Crane NXT, Co.

and Crane Company (“SpinCo”) through a pro-rata distribution (the “Distribution”) of all the issued and outstanding common stock of SpinCo to the stockholders of Holdings.

References to "core sales” exclude currency effects and, where applicable, the first-year impacts of acquisitions and divestitures.

References herein to “Crane NXT,” “the Company,” “we,” “us” and “our” refer to Crane NXT, Co.

and its subsidiaries.

References to "organic sales” exclude currency effects and, where applicable, the first-year impacts of acquisitions and divestitures.

Amounts in the following discussion are presented in millions, except employee, share and per share data, or unless otherwise stated.

27 unchanged sentences

Recent Transactions

Credit Facilities

In the nine months ended September 30, 2025, we drew down $384.5 million and repaid $413.5 million on our Revolving Facility to fund working capital requirements.

We also drew down £300.0 million, or $400.4 million, on the Term Loan to fund the DLR acquisition and repaid $40.9 million.

On September 15, 2025, we entered into a commitment for a senior secured 364-day Bridge Facility of $602 million and a Backstop Facility of $831 million.

The Backstop Facility was in place until October 7, 2025 when the amendment to the Credit Agreement was ratified.

The Bridge Facility is available to fund the Antares Vision acquisition and related transactions until permanent financing is secured.

Antares Vision Acquisition

On September 12, 2025, Crane NXT entered into definitive agreements to acquire Antares Vision, a publicly traded Italian joint stock company listed on the Italian stock exchange, through a phased transaction.

The total enterprise value of Antares Vision, inclusive of equity and net debt, is approximately €445 million.

The first phase of the transaction is expected to close in the fourth quarter of 2025 with the final phase of the transaction anticipated in the first half of 2026, subject to customary closing conditions and regulatory approvals.

Antares Vision is a global provider of inspection and detection systems that ensure product safety and quality control, as well as track and trace software solutions that help prevent counterfeiting and provides visibility of products throughout the supply chain.

The acquisition advances our strategy and expands the Company’s portfolio in growing end markets, including Life Sciences and Food and Beverage.

DLR Acquisition

On May 1, 2025, we acquired De La Rue Authentication Solutions (“DLR”) for a base purchase price of £300 million .

We utilized our Term Loan to fund the acquisition.

DLR is a leading global provider of digital and physical security and authentication technologies to governments and brands, and expands our portfolio of authentication solutions.

DLR was combined with OpSec as “Crane Authentication” within the Security and Authentication Technologies segment upon close.

Restructuring

In the second and third quarter of 2025 we initiated restructuring actions as follows:

• We recorded $8.5 million of restructuring expense in the SAT segment, predominantly related to severance charges, associated with the integration of the DLR and OpSec businesses.

We expect to substantially complete the restructuring program in 2025, with total costs expected to be in the range of $10 million to $15 million.

• We recorded $2.3 million of restructuring expense in the CPI segment, predominantly related to severance charges.

We will continue to evaluate and align CPI’s cost structure with existing economic conditions which could result in additional actions.

Trade Policies and Regulations

We continue to monitor developments in global trade policies and tariff regulations.

As of November 5, 2025, we expect to mitigate the majority of tariffs on operating profit with pricing and productivity initiatives.

The related macroeconomic uncertainty is also affecting demand, primarily in our CPI vending business, which is driving lower sales volumes.

See Item 1A, “Risk Factors” for more details.

Crane NXT acquired a controlling interest in Antares Vision S.p.A.

(“Antares Vision”) through a multi‑phase acquisition which was completed on March 31, 2026, resulting in 100% ownership.

Antares Vision is a global provider of inspection, detection, and track‑and‑trace solutions serving life sciences and food and beverage end markets.

Prior to obtaining control, the Company accounted for its investment in Antares Vision under the equity method of accounting and recognized its proportionate share of Antares Vision’s results of operations in "Equity investment income" in the Unaudited Condensed Consolidated Statements of Operations.

Credit Facilities

In the three months ended March 31, 2026, we drew down $30.0 million and repaid $30.0 million on our Revolving Facility to fund working capital requirements.

We borrowed €317.9 million, or $366.9 million, under the Term Loan B to fund the acquisition of Antares Vision and assumed $123.5 million of Antares Vision debt, which is expected to be paid in the second quarter of 2026.

In addition, we repaid $112.4 million of Term Loan A.

Conflict in the Middle East

The Company is closely monitoring the ongoing conflict in the Middle East and other active military engagements, for the potential effects on global markets and business operations.

Although our direct presence in affected regions is limited, our status as a global enterprise with international operations means we distribute products and solutions across numerous countries.

Management has taken appropriate steps to secure the safety of its associates in affected regions, as applicable.

At present, the duration and scope of these conflicts remains uncertain, and we may experience increased risk of adverse impacts on our financial results such as increased financial market volatility and rising energy costs.

Basis of Presentation

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results from Operations – Three Month Periods Ended September 30,

Results from Operations – Three Month Periods Ended March 31,

The following information should be read in conjunction with our Unaudited Condensed Consolidated financial statements and related notes.

All comparisons below refer to the third quarter 2025 versus the third quarter 2024 , unless otherwise specified.

Three Months Ended September 30, Favorable/(Unfavorable) Change

All comparisons below refer to the first quarter 2026 versus the first quarter 2025 , unless otherwise specified.

Three Months Ended March 31, Favorable/(Unfavorable) Change

(in millions) 2026 2025 $ %

8 unchanged sentences

Other income (expense):

Interest income 0.3 0.4 (0.1) (25.0) %

Interest expense (17.8) (11.5) (6.3) (54.8) %

Miscellaneous income (expense), net 0.6 1.3 (0.7) NM

Equity investment income 4.7 0.1 4.6 NM

Miscellaneous income, net 0.1 2.2 (2.1) NM

Total other expense, net (13.0) (9.2) (3.8) (41.3) %

6 unchanged sentences

The change in sales included:

• sales benefit from the DLR acquisition of $28.3 million, or 7.0%,

• favorable foreign currency translation of $7.6 million, or 1.9% driven primarily by the strengthening of the euro, British pound, Swedish krona and Japanese yen against the U.S.

• core sales increase of $5.7 million, or 1.4%, driven primarily by our SAT segment, partially offset by lower volumes in CPI.

• sales benefit from the De La Rue acquisition of $26.5 million, or 8.0%,

• organic sales growth of $18.3 million, or 5.6%, driven primarily by the Currency business, and

• favorable foreign currency translation of $12.6 million, or 3.8%.

Cost of sales increased by $41.7 million, or 21.9%, to $231.8 million in 2026.

The increase was driven primarily by the impact of acquisitions in SAT, higher material and other manufacturing costs, and unfavorable foreign currency translation, partially offset by productivity gains and the impact of lower volumes in CPI.

The increase was driven by the impact of the De La Rue acquisition of $18.9 million, or 9.9%, acquisition related amortization, higher manufacturing expenses, unfavorable foreign currency translation and unfavorable mix, partially offset by productivity gains.

Selling, general and administrative expenses increased by $27.7 million, or 26.9%, to $130.6 million in 2026.

The increase was driven primarily by the impact of acquisitions in SAT and unfavorable foreign currency translation.

Operating profit increased by $6.9 million, or 9.2%, to $81.9 million in 2025.

The increase was driven primarily by favorable pricing and productivity gains across both segments, partially offset by the impact of lower volumes in CPI and the dilutive impact of acquisitions.

Restructuring charges were largely offset by cost-saving actions.

Our effective tax rate for the three months ended September 30, 2025 was lower than the prior year’s comparable period primarily due to the mix of non-U.S.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Segment Results of Operations - Three Month Periods Ended September 30,

Crane Payment Innovations

Three Months Ended September 30, Favorable/(Unfavorable) Change

(in millions) 2025 2024 $ %

Net sales by product line:

Payment Acceptance and Dispensing Products $ 181.3 $ 190.9 $ (9.6) (5.0) %

Services 35.0 34.0 1.0 2.9 %

Total net sales $ 216.3 $ 224.9 $ (8.6) (3.8) %

Cost of sales $ 109.2 $ 113.6 $ 4.4 3.9 %

as a percentage of sales 50.5 % 50.5 %

Selling, general and administrative $ 45.3 $ 46.7 $ 1.4 3.0 %

as a percentage of sales 20.9 % 20.8 %

Restructuring charges $ 1.1 $ — $ (1.1) NM

Operating profit $ 60.7 $ 64.6 $ (3.9) (6.0) %

Operating margin 28.1 % 28.7 %

Sales decreased by $8.6 million, or 3.8%, to $216.3 million in 2025, driven by lower core sales of $10.1 million, or 4.5%, partially offset by favorable foreign currency translation of $1.5 million, or 0.7%.

• Sales of Payment Acceptance and Dispensing Products decreased by $9.6 million, or 5.0%, to $181.3 million in 2025.

The decrease was driven by a core sales decline of $11.1 million, or 5.8%, as favorable pricing was more than offset by anticipated lower volumes primarily in vending, partially offset by favorable foreign currency translation of $1.5 million, or 0.8%, reflecting the strengthening of the British pound and Japanese yen against the U.S.

• Service revenue increased by $1.0 million, or 2.9%, to $35.0 million in 2025, driven by favorable pricing.

Cost of sales decreased by $4.4 million, or 3.9%, to $109.2 million in 2025, driven by the impact of lower sales volumes.

Selling, general and administrative expense decreased by $1.4 million, or 3.0%, to $45.3 million in 2025, driven by cost saving actions.

The increase was driven by the impact of the De La Rue acquisition, stock-based compensation expense from the Antares Vision acquisition and higher transaction related expenses, partially offset by the impact of cost saving actions.

Operating profit decreased by $15.1 million, or 40.5%, to $22.2 million in 2026.

The decrease reflected the impact of lower volumes of $9.5 million, or 14.7%, and unfavorable mix of $2.6 million, or 4.0%, partially offset by favorable pricing, net of inflation of $4.1 million, or 6.4%, and productivity gains and net cost saving actions of $4.0 million, or 6.2%.

The decrease was driven by incremental costs related to acquisitions, such as higher transaction related expenses of $9.3 million, or 24.9%, and higher stock-based compensation expense as a result of the Antares Vision acquisition of $10.7 million, or 28.7%, partially offset by the impact of higher volumes in Currency net of higher manufacturing expenses of $6.8 million, or 18.2%.

Our effective tax rate for the three months ended March 31, 2026 was higher than the prior year’s comparable period primarily due to the lower excess stock compensation deduction in the U.S.

as of March 31, 2026.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Security and Authentication Technologies

Three Months Ended September 30, Favorable/(Unfavorable) Change

Segment Results of Operations - Three Month Periods Ended March 31,

Security and Authentication Technologies (“SAT”)

Three Months Ended March 31, Favorable/(Unfavorable) Change

(in millions) 2026 2025 $ %

8 unchanged sentences

Restructuring charges $ 2.2 $ — $ (2.2) NM

Operating profit $ 39.3 $ 29.3 $ 10.0 34.1 %

Operating profit $ 15.1 $ 2.4 $ 12.7 NM

Operating margin 7.8 % 1.9 %

Sales increased by $50.2 million, or 28.1%, to $228.8 million in 2025, driven by the sales benefit from the DLR acquisition of $28.3 million, or 15.8%, core sales growth of $15.8 million, or 8.8%, and favorable foreign currency translation of $6.1 million or 3.4%.

Sales increased by $65.4 million, or 51.3%, to $192.8 million in 2026, driven by organic sales growth of $28.6 million, or 22.4%, the sales benefit from the De La Rue acquisition of $26.5 million, or 20.8%, and favorable foreign exchange of $10.3 million or 8.1%.

• Banknote and security product sales increased by $47.0 million, or 50.3%, to $140.4 million in 2026.

The increase was driven by core sales growth of $16.9 million, or 11.6%, primarily due to higher volumes in U.S.

The increase was driven by organic sales growth of $37.0 million, or 39.6%, reflecting higher sales in both U.S.

and international markets.

Included in the sales increase was favorable foreign currency translation of $5.9 million, or 4.1%, reflecting the strengthening of the euro and Swedish krona against the U.S.

• Authentication products and solutions sales increased by $27.4 million to $60.6 million in 2025, driven by the sales benefit from the DLR acquisition.

Cost of sales increased by $24.7 million, or 20.8%, to $143.3 million in 2025, due to the impact of the DLR acquisition of $16.2 million, or 13.7%, acquisition related amortization and fair value step-up of $7.1 million, or 6.0%, and unfavorable foreign currency translation of $4.8 million, or 4.0%.

Selling, general and administrative expense increased by $13.1 million, or 42.7%, to $43.8 million in 2025, due to the impact of the DLR acquisition and higher administrative expenses.

Operating profit increased by $10.0 million, or 34.1%, to $39.3 million in 2025, reflecting the impact of higher volumes of $5.8 million, or 19.9%, favorable mix of $4.6 million, or 15.7%, and productivity gains of $4.3 million, or 14.8%, partially offset by dilutive impact of the DLR acquisition of $3.1 million, or 10.5%, predominantly due to acquisition related amortization and fair value step-up.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results from Operations – Nine Month Periods Ended September 30,

The following information should be read in conjunction with our Unaudited Condensed Consolidated Financial Statements and related notes.

All comparisons below refer to the first nine months of 2025 versus the first nine months of 2024, unless otherwise specified.

Nine Months Ended September 30, Favorable/(Unfavorable) Change

(in millions) 2025 2024 $ %

Net sales $ 1,179.8 $ 1,087.7 $ 92.1 8.5 %

Cost of sales $ 678.2 $ 603.1 $ (75.1) (12.5) %

as a percentage of sales 57.5 % 55.4 %

Selling, general and administrative

$ 323.7 $ 283.9 $ (39.8) (14.0) %

as a percentage of sales 27.4 % 26.1 %

Restructuring charges $ 10.8 $ 2.7 $ (8.1) NM

Operating profit $ 167.1 $ 198.0 $ (30.9) (15.6) %

Operating margin 14.2 % 18.2 %

Other income (expense):

Interest income 0.7 1.4 (0.7) (50.0) %

Interest expense (44.1) (35.7) (8.4) (23.5) %

Miscellaneous income, net 3.8 1.7 2.1 NM

Total other expense, net (39.6) (32.6) (7.0) (21.5) %

Income before income taxes 127.5 165.4 (37.9) (22.9) %

Provision for income taxes 29.9 38.9 9.0 23.1 %

Net income before allocation to noncontrolling interest 97.6 126.5 (28.9) (22.8) %

Noncontrolling interest in subsidiaries’ earnings 0.5 — 0.5 NM

Net income attributable to common shareholders $ 97.1 $ 126.5 $ (29.4) (23.2) %

Sales increased by $92.1 million, or 8.5%, to $1,179.8 million in 2025.

The change in sales included:

• sales benefit from the DLR and OpSec acquisitions of $89.4 million, or 8.2%,

• core sales decline of $10.2 million, or 0.9%, driven by lower volumes in CPI, and

• favorable foreign currency translation of $12.9 million, or 1.2%, driven by the strengthening of the euro and British pound against the U.S.

Cost of sales increased by $75.1 million, or 12.5%, to $678.2 million in 2025.

The increase was driven by the impact of the DLR acquisition in SAT, under absorption of manufacturing overhead in the Currency business, unfavorable mix in CPI and unfavorable foreign currency translation, partially offset by the impact of lower volumes in CPI and productivity gains across both segments.

Selling, general and administrative expenses increased by $39.8 million, or 14.0%, to $323.7 million in 2025.

The increase was driven by the impact of the DLR acquisition in SAT.

Operating profit decreased by $30.9 million, or 15.6%, to $167.1 million in 2025.

The decrease was driven by the impact of lower volumes in CPI, the dilutive impact of the DLR acquisition in SAT, under absorption of manufacturing overhead, higher transaction related expenses and unfavorable mix in CPI, partially offset by productivity gains across both segments.

Our effective tax rate for the nine months ended September 30, 2025 was higher than the prior year’s comparable period primarily due to the mix of non-U.S earnings.

Favorable foreign currency translation of $10.0 million, or 10.7%, reflects the strengthening of the Swedish krona and euro against the U.S.

• Authentication products and solutions sales increased to $52.4 million in 2026, driven by the sales benefit from the De La Rue acquisition.

Cost of sales increased by $42.8 million, or 49.6%, to $129.1 million in 2026, due to the impact of the De La Rue acquisition of $18.9 million, or 21.9%, acquisition related amortization, higher manufacturing expenses, the impact of higher volumes in the Currency business, and unfavorable foreign currency translation.

Selling, general and administrative expense increased by $7.7 million, or 19.9%, to $46.4 million in 2026, due to the impact of the De La Rue acquisition.

Operating profit increased by $12.7 million, to $15.1 million in 2026, reflecting the impact of higher volumes, net of higher manufacturing expenses, of $12.6 million.

Productivity gains and the impact of cost saving actions were largely offset by acquisition related amortization.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Segment Results of Operations - Nine Month Periods Ended September 30,

Crane Payment Innovations

Nine Months Ended September 30,

Favorable/(Unfavorable) Change

Detection and Traceability Technologies (“DTT”)

Three Months Ended March 31, Favorable/(Unfavorable) Change

(in millions) 2026 2025 $ %

Net sales by product line:

Payment Acceptance and Dispensing Products $ 528.3 $ 557.9 $ (29.6) (5.3) %

Detection and Inspection Products and Solutions $ 160.1 $ 169.9 $ (9.8) (5.8) %

Services 34.8 33.0 1.8 5.5 %

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as a percentage of sales 30.7 % 24.3 %

Restructuring charges $ 2.3 $ 2.7 $ 0.4 14.8 %

Restructuring charges $ 0.9 $ — $ (0.9) NM

Operating profit $ 31.4 $ 49.7 $ (18.3) (36.8) %

Operating margin 16.1 % 24.5 %

Sales decreased by $27.7 million, or 4.2%, to $630.6 million in 2025, driven by lower core sales of $31.1 million, or 4.7%, partially offset by favorable foreign currency translation of $3.4 million, or 0.5%.

• Sales of Payment Acceptance and Dispensing Products decreased $29.6 million, or 5.3%, to $528.3 million in 2025.

The decrease reflected lower core sales of $33.0 million, or 5.9%, as favorable pricing was more than offset by anticipated lower volumes primarily in gaming and vending, partially offset by favorable foreign currency translation of $3.4 million, or 0.6%, reflecting the strengthening of the British pound and Japanese yen against the U.S.

Sales decreased by $8.0 million, or 4.0%, to $194.9 million in 2026, driven by lower organic sales of $10.3 million, or 5.1%, offset by favorable foreign currency translation of $2.3 million, or 1.1%.

• Sales of Detection and Inspection products and solutions decreased by $9.8 million, or 5.8%, to $160.1 million in 2026.

The decrease was driven by organic sales decline of $12.0 million, or 7.1%, due to lower hardware volumes.

The sales decrease was partially offset by favorable foreign currency translation of $2.2 million, or 1.3%, reflecting the strengthening of the British pound and Australian dollar against the U.S.

dollar, partially offset by the weakening of the Japanese yen against the U.S.

• Service revenue increased by $1.8 million, or 5.5%, to $34.8 million in 2026, driven by favorable pricing.

Cost of sales decreased by $8.3 million, or 2.5%, to $324.7 million in 2025, driven by the impact of lower sales volumes and productivity gains, partially offset by unfavorable mix, higher material and other manufacturing costs and unfavorable foreign currency translation.

Selling, general and administrative expense increased by $0.3 million, or 0.2%, to $144.2 million in 2025, driven by higher administrative costs largely offset by cost-saving actions.

Cost of sales decreased by $1.1 million, or 1.1%, to $102.7 million in 2026, mainly due to the impact of lower sales volumes, partially offset by unfavorable mix and unfavorable foreign currency translation.

Selling, general and administrative expense increased by $10.5 million, or 21.3%, to $59.9 million in 2026.

The increase was driven by stock-based compensation expense from the Antares Vision acquisition.

Operating profit decreased by $18.3 million, or 36.8%, to $31.4 million in 2026.

The decrease reflected the impact of lower volumes of $25.4 million, or 14.2%, unfavorable mix of $12.9 million, or 7.2%, partially offset by productivity gains of $8.5 million, or 4.7%, and the impact of cost saving actions of $7.7 million, or 4.3%.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Security and Authentication Technologies

Nine Months Ended September 30, Favorable/(Unfavorable) Change

(in millions) 2025 2024 $ %

Net sales by product line:

Banknotes and Security Products $ 405.1 $ 372.9 $ 32.2 8.6 %

Authentication Products and Solutions 144.1 56.5 87.6 NM

Net sales $ 549.2 $ 429.4 $ 119.8 27.9 %

Cost of sales $ 353.5 $ 270.1 $ (83.4) (30.9) %

as a percentage of sales 64.4 % 62.9 %

Selling, general and administrative $ 127.5 $ 85.8 $ (41.7) (48.6) %

as a percentage of sales 23.2 % 20.0 %

Restructuring charges $ 8.5 $ — $ (8.5) NM

Operating profit $ 59.7 $ 73.5 $ (13.8) (18.8) %

Operating margin 10.9 % 17.1 %

Sales increased by $119.8 million, or 27.9%, to $549.2 million in 2025, reflecting the sales benefit from the OpSec and DLR acquisitions of $89.4 million, or 20.8%, higher core sales of $20.9 million, or 4.9%, and favorable foreign currency translation of $9.5 million, or 2.2%.

• Banknote and security product sales increased by $32.2 million, or 8.6%, to $405.1 million in 2025, reflecting higher core sales in both U.S.

and international markets, and favorable foreign currency translation, reflecting the strengthening of the euro and Swedish krona against the U.S.

• Authentication products and solutions sales increased by $87.6 million to $144.1 million in 2025, driven by the sales benefit from acquisitions.

Cost of sales increased by $83.4 million, or 30.9%, to $353.5 million in 2025, due to the impact of the OpSec and DLR acquisitions of $55.8 million, or 20.6%, acquisition related amortization and fair value step-up, under absorption of manufacturing overhead related to the planned equipment shutdown in the first quarter of 2025, unfavorable foreign currency translation, partially offset by productivity gains and the impact of higher volumes.

Selling, general and administrative expense increased by $41.7 million, or 48.6%, to $127.5 million in 2025, due to the impact of acquisitions.

Operating profit decreased by $13.8 million, or 18.8%, to $59.7 million in 2025, reflecting the dilutive impact of the OpSec and DLR acquisitions due to acquisition related amortization and fair value step-up of $16.4 million, or 22.4%, higher manufacturing costs primarily due to the under absorption of manufacturing overhead, net of favorable pricing of $12.2 million, or 16.6%, restructuring charges of $8.5 million, or 11.6%, partially offset by productivity gains of $12.5 million, or 17.0%, the impact of higher volumes of $5.0 million, or 6.8% and favorable mix of $4.5 million, or 6.1%.

The decrease reflects the impact of lower volumes of $7.2 million, or 14.5%, and stock-based compensation expense as a result of the Antares Vision acquisition of $10.7 million, or 21.5%, unfavorable mix of $2.1 million, or 4.2%, partially offset by the impact of cost saving actions.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Liquidity and Capital Resources

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2026 2025

Net cash provided by (used for):

Net cash (used for) provided by:

Operating activities $ (14.0) $ (19.1)

2 unchanged sentences

Effect of exchange rates on cash, cash equivalents and restricted cash (1.8) 6.7

Increase (decrease) in cash, cash equivalents and restricted cash $ 21.4 $ (53.2)

(Decrease) increase in cash, cash equivalents and restricted cash $ (7.2) $ 12.0

Our operating philosophy is to deploy cash provided from operating activities, when appropriate, to provide value to stockholders by reinvesting in existing businesses, by making acquisitions that will strengthen and complement our portfolio;

3 unchanged sentences

Our current cash balance, together with cash we expect to generate from future operations along with borrowings available under the Credit Agreement, is expected to be sufficient to finance our short- and long-term capital requirements.

In the nine months ended September 30, 2025, we drew down $384.5 million and repaid $413.5 million on our Revolving Facility to support working capital needs.

We also drew down £300.0 million, or $400.4 million, on the Term Loan to fund the DLR acquisition and repaid $40.9 million.

In the three months ended March 31, 2026, we borrowed €317.9 million, or $366.9 million, under the Term Loan B to fund the acquisition of Antares Vision and assumed $123.5 million of Antares Vision debt, which is expected to be paid in the second quarter of 2026.

In addition, we repaid $112.4 million of Term Loan A.

Operating Activities

Cash provided by operating activities was $135.7 million in the first nine months of 2025, compared with $133.0 million in the comparable period last year.

The increase in cash provided by operating activities was primarily driven by lower working capital requirements.

Cash used for operating activities was $14.0 million in the first three months of 2026, compared with $19.1 million during the same period last year.

The decrease in cash used for operating activities was primarily driven by lower working capital requirements.

Investing Activities

1 unchanged sentence

Capital expenditures are made primarily for increasing capacity, replacing equipment, supporting new product development, and improving information systems.

Cash used for investing activities was $422.7 million in the first nine months of 2025, compared with $304.4 million in the comparable period last year.

The increase in cash used for investing activities was primarily driven by the payment for the acquisition of DLR.

Cash used for investing activities was $231.2 million in the first three months of 2026, compared with $13.6 million in the comparable period last year.

The increase in cash used for investing activities was primarily driven by the payment of $225.4 million to acquire the remaining ownership stake in Antares Vision.

Financing Activities

Cash provided by financing activities consists primarily of dividend payments to shareholders, repayments of indebtedness, and proceeds from our credit facilities.

Cash provided by financing activities was $293.3 million during the first nine months of 2025, compared with $115.8 million in the comparable period last year.

The increase was primarily driven by higher net proceeds from the Term Loan used to fund the acquisition of DLR, partially offset by net payments on the Revolving Facility in the first nine month of 2025 compared to net proceeds from Revolving Facility during the same period in 2024.

Cash provided by (used for) financing activities consists primarily of dividend payments to shareholders, repayments of indebtedness, and proceeds from our credit facilities.

Cash provided by financing activities was $239.8 million during the first three months of 2026, compared with $38.0 million in the comparable period last year.

The increase in cash provided by financing activities was primarily driven by higher net proceeds from the Term Loan B borrowing of $366.9 million to fund the Antares Vision acquisition, partially offset by $112.4 million repayment of the Term Loan A and $53.5 million lower net revolver borrowings compared to the prior year.

Recent Accounting Pronouncements

3 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis