What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-07 compared with 2025-05-08 · 161 added, 58 removed, 247 unchanged (47% of the section changed)

1 unchanged sentence

The following management discussion and analysis ("MD&A") of the financial condition and results of operations of DXP Enterprises, Inc.

together with its subsidiaries (collectively "DXP," "Company," "us," "we," or "our") for the three months ended March 31, 2025 should be read in conjunction with our previous Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q, and the consolidated financial statements and notes thereto included in such reports.

together with its subsidiaries (collectively "DXP," "Company," "us," "we," or "our") for the six months ended June 30, 2025 should be read in conjunction with our previous Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q, and the consolidated financial statements and notes thereto included in such reports.

The Company's consolidated financial statements are prepared in accordance with U.S.

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The replacement and mission-critical nature of our products and services within the Company's Service Centers and Innovative Pumping Solutions business segments and industrial and manufacturing environments and processes drives a demand and outlook that are correlated with global, national and regional industrial production, capacity utilization and long-term GDP growth.

For the three months ended March 31, 2025, we had approximately $413.3 million in sales in our Service Centers and Innovative Pumping Solutions segments, an increase of approximately 17.9 percent compared to the three months ended March 31, 2024.

For the six months ended June 30, 2025, we had approximately $846.5 million in sales in our Service Centers and Innovative Pumping Solutions segments, an increase of approximately 15.9 percent compared to the six months ended June 30, 2024.

Our performance has been strengthened by price increases from our vendors and suppliers and the Company's acquisition activity.

During the three months ended March 31, 2025, $13.2 million was associated with recent acquisitions in the water and wastewater markets.

During the six months ended June 30, 2025, $22.2 million in sales was associated with recent acquisitions in the water and wastewater markets.

Supply Chain Services Segment

For the three months ended March 31, 2025, we had approximately $63.3 million in sales in our Supply Chain Services segment, an increase of approximately 2.1 percent compared to the three months ended March 31, 2024.

For the six months ended June 30, 2025, we had approximately $128.7 million in sales in our Supply Chain Services segment, an increase of approximately 0.8 percent compared to the six months ended June 30, 2024.

This is primarily due to new customer facilities, slightly offset by facility closures due to the inherent efficiencies we bring to customers as part of our value proposition.

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Our results of operations are not directly comparable on a year-over-year basis due to various prior acquisitions and the varying size and number of acquisitions in any comparable period.

We account for acquisitions under Accounting Standards Codification 805, Business Combinations ("ASC 805").

Accordingly, the results of acquisitions are included subsequent to their respective acquisition dates and the Company provides detail around Organic and Acquisition Sales as defined in our Key Business Metrics.

During the three months ended March 31, 2025, acquisition sales were $31.1 million compared $11.8 million for the three months ended March 31, 2024.

During the six months ended June 30, 2025, acquisition sales were $55.7 million compared to $35.2 million for the six months ended June 30, 2024.

From time to time, typically based upon a leap year, our comparable business days may not equal each other.

There were 63 business days during the three months ended March 31, 2025 and 63 business days during the three months ended March 31, 2024, as such there was no comparability impact this quarter.

There were 126 business days during the six months ended June 30, 2025 and 127 business days during the six months ended June 30, 2024.

As such, during the second quarter, there was one less business day compared to the prior year's corresponding period.

Key Business Metrics

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GAAP measures.

Three Months Ended March 31,

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

2025 2024 2025 2024

Sales by Business Segment

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Gross Profit Margin 31.6 % 30.9 % 31.6 % 30.5 %

Income from Operations

$ 45,986 $ 37,352 $ 86,501 $ 66,483

Income from Operations Margin

9.2 % 8.4 % 8.9 % 7.7 %

Net Income $ 23,612 $ 16,693 $ 44,201 $ 28,025

Net Income Margin 4.7 % 3.7 % 4.5 % 3.3 %

EBITDA $ 55,830 $ 46,514 $ 106,797 $ 85,152

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Adjusted EBITDA Margin 11.5 % 10.8 % 11.3 % 10.3 %

Net cash provided by operating activities

$ 18,646 $ 14,735 $ 21,619 $ 41,724

Free Cash Flow

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The SCS segment provides a wide range of MRO products and manages all or part of our customer's supply chain function, and inventory management.

Three Months Ended March 31, 2025 compared to Three Months Ended March 31, 2024

Three Months Ended March 31,

Three Months Ended June 30, 2025 compared to Three Months Ended June 30, 2024

Three Months Ended June 30,

2025 % 2024 %

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$ 1.43 $ 1.00

Sales for the three months ended March 31, 2025 increased $63.9 million, or 15.5 percent, to approximately $476.6 million from $412.6 million for the prior year's corresponding period.

The overall increase in sales was the result of an increase in sales in our SC, IPS, and SCS segments of $38.6 million, $24.0 million, and $1.3 million, respectively.

The fluctuations in sales are further explained in our business segment discussions below.

Three Months Ended March 31,

2025 2024 Change Change%

Sales by Business Segment

The following tables sets forth the disaggregation of revenue from sales associated with acquisitions for the three and six months ended June 30, 2025 and 2024 (in thousands) :

Sales Acquisition Sales Organic Sales

Three Months Ended June 30, 2025

Service Centers $ 339,731 $ 15,555 $ 324,176

1 unchanged sentence

Supply Chain Services 65,411 — 65,411

Total DXP Sales $ 476,569 $ 412,635 $ 63,934 15.5 %

Total Sales $ 498,682 $ 24,605 $ 474,077

Three Months Ended June 30, 2024

Service Centers $ 306,516 $ 8,708 $ 297,808

Innovative Pumping Solutions 73,377 14,695 58,682

Supply Chain Services 65,663 — 65,663

Total Sales $ 445,556 $ 23,403 $ 422,153

Service Centers $ 33,215 $ 6,847 $ 26,368

Innovative Pumping Solutions 20,163 (5,645) 25,808

Supply Chain Services (252) — (252)

Total $ Change $ 53,126 $ 1,202 $ 51,924

Service Centers 10.8 % 78.6 % 8.9 %

Innovative Pumping Solutions 27.5 % (38.4) % 44.0 %

Supply Chain Services (0.4) % N/A (0.4) %

Total % Change 11.9 % 5.1 % 12.3 %

Sales for the three months ended June 30, 2025 increased $53.1 million, or 11.9 percent, to approximately $498.7 million from $445.6 million for the prior year's corresponding period, of which acquisitions contributed $24.6 million.

Additionally, the overall increase in sales was the result of an increase in sales in our SC and IPS segments of $33.2 million and $20.2 million, slightly offset by a decrease in our SCS segment of $0.3 million.

The fluctuations in sales are further explained in our business segment discussions below.

GROSS PROFIT.

Gross profit margin for the three months ended June 30, 2025 was 31.6 percent compared to 30.9 percent for the prior year's corresponding period.

The gross profit margin for the three months ended June 30, 2025 was positively impacted by 70 basis points due to recent acquisitions and continuing margin expansion opportunities.

Service Centers segment.

Sales for the SC segment increased $38.6 million, or 13.4 percent, for the three months ended March 31, 2025, compared to the prior year's corresponding period.

This sales increase was the result of increases within our Texas Gulf Coast, Ohio River Valley, and California regions, offset by decreases in our North Rockies region.

Additionally, $17.9 million in sales increase was associated with recent acquisitions.

Sales for the SC segment increased $33.2 million, or 10.8 percent, for the three months ended June 30, 2025, compared to the prior year's corresponding period.

Organic sales grew $26.4 million, this sales increase was the result of increases within our Ohio River Valley, California and South Central and Rockies regions totaling $12.4 million.

Additionally, the increase was also attributable to an overall increase in our rotating equipment and air compressors product categories totaling $14.6 million.

Sales attributable to recent acquisitions was $15.6 million during the period as compared to $8.7 million in the three months ended June 30, 2024.

Innovative Pumping Solutions segment.

Sales for the IPS segment increased $24.0 million, or 38.5 percent, for the three months ended March 31, 2025, compared to the prior year's corresponding period.

This sales increase was the result of increases within our fabrication and global solutions groups.

Additionally, $13.2 million was associated with recent acquisitions in the water and wastewater markets.

Sales for the IPS segment increased $20.2 million, or 27.5 percent, for the three months ended June 30, 2025, compared to the prior year's corresponding period.

This sales increase was the result of increases within our fabrication, global solutions division, and our water and wastewater division totaling $25.8 million.

Sales attributable to recent acquisitions was $9.0 million during the period as compared to $14.7 million for the three months ended June 30, 2024.

Supply Chain Services segment.

Sales for the SCS segment increased by $1.3 million, or 2.1 percent, for the three months ended March 31, 2025, compared to the prior year's corresponding period.

The increase in sales was primarily the result of increases within our oil and gas end market, offset by decreases in our bearings and powertrain end markets.

Sales for the SCS segment decreased by $0.3 million, or 0.4 percent, for the three months ended June 30, 2025, compared to the prior year's corresponding period.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ("SG&A").

SG&A for the three months ended March 31, 2025 increased by $15.0 million, or 15.8 percent, to $109.8 million from $94.8 million for the prior year's corresponding period.

The increase in SG&A is primarily the result of increased payroll, incentive compensation and related taxes and 401(k) expenses.

SG&A for the three months ended June 30, 2025 increased by $11.4 million, or 11.3 percent, to $111.8 million from $100.4 million for the prior year's corresponding period.

The increase in SG&A is primarily the result of increased payroll related costs, depreciation and amortization, rent and IT expense.

OPERATING INCOME.

Operating income for the first quarter of 2025 increased by $11.4 million to $40.5 million, from $29.1 million in the prior year's corresponding period.

Operating income for the second quarter of 2025 increased by $8.6 million to $46.0 million, from $37.4 million in the prior year's corresponding period.

This increase in operating income was primarily driven by increases in our SC and IPS segments.

INTEREST EXPENSE.

Interest expense for the first quarter of 2025 decreased $0.9 million compared to the prior year's corresponding period.

Interest expense for the second quarter of 2025 decreased $0.6 million compared to the prior year's corresponding period.

This decrease was primarily due to the Company refinancing its Term Loan during the fourth quarter of 2024.

INCOME TAXES.

Our effective tax rate from continuing operations was a tax expense of 24.2 percent for the three months ended March 31, 2025, compared to a tax expense of 27.2 percent for the three months ended March 31, 2024.

Our effective tax rate for continuing operations was 25.3 percent for the three months ended June 30, 2025, compared to 27.4 percent for the three months ended June 30, 2024.

Compared to the U.S.

statutory rate for the three months ended March 31, 2025, the effective tax rate was increased by state taxes, foreign taxes, nondeductible expenses, and uncertain tax positions recorded for research and development tax credits and partially offset by research and development tax credits and other tax credits.

statutory rate for the three months ended June 30, 2024, the effective tax rate decreased primarily due to a higher tax benefit from stock compensation vested during the period, a higher benefit from state income taxes, and higher tax benefits from research and development tax credits (R&D).

These benefits were partially offset by recognition of uncertain tax positions related to R&D tax credits.

Six Months Ended June 30, 2025 compared to Six Months Ended June 30, 2024

Six Months Ended June 30,

2025 % 2024 %

Sales $ 975,251 100.0% $ 858,191 100.0%

Cost of sales 667,173 68.4% 596,516 69.5%

Gross profit 308,078 31.6% 261,675 30.5%

Selling, general and administrative expenses 221,577 22.7% 195,192 22.7%

Income from operations 86,501 8.9% 66,483 7.7%

Interest expense

29,404 3.0% 30,928 3.6%

Other (income) expense, net

(1,672) (0.2)% (3,004) (0.4)%

Income before income taxes 58,769 6.0% 38,559 4.5%

Provision for income taxes 14,568 1.5% 10,534 1.2%

$ 44,201 4.5% $ 28,025 3.3%

Earnings per share:

$ 2.81 $ 1.75

$ 2.67 $ 1.66

The following table sets forth the reconciliation of Acquisition Sales and Organic Sales to the most comparable U.S.

GAAP financial measure (in thousands) :

Sales Acquisition Sales Organic Sales

Six Months Ended June 30, 2025

Service Centers $ 666,806 $ 33,496 $ 633,310

Innovative Pumping Solutions 179,722 22,221 157,501

Supply Chain Services 128,723 — 128,723

Total Sales $ 975,251 $ 55,717 $ 919,534

Six Months Ended June 30, 2024

Service Centers $ 594,952 $ 10,219 $ 584,733

Innovative Pumping Solutions 135,592 24,959 110,633

Supply Chain Services 127,647 — 127,647

Total Sales $ 858,191 $ 35,178 $ 823,013

Service Centers $ 71,854 $ 23,277 $ 48,577

Innovative Pumping Solutions 44,130 (2,738) 46,868

Supply Chain Services 1,076 — 1,076

Total $ Change $ 117,060 $ 20,539 $ 96,521

Service Centers 12.1 % 227.8 % 8.3 %

Innovative Pumping Solutions 32.5 % (11.0) % 42.4 %

Supply Chain Services 0.8 % N/A 0.8 %

Total % Change 13.6 % 58.4 % 11.7 %

Sales for the six months ended June 30, 2025 increased $117.1 million, or 13.6 percent, to approximately $975.3 million from $858.2 million for the prior year's corresponding period, of which acquisitions contributed $55.7 million.

Additionally, the overall increase in sales was the result of an increase in sales within our SC, IPS, and SCS segments of $71.9 million, $44.1 million, and $1.1 million, respectively.

The fluctuations in sales are further explained in our business segment discussions below.

GROSS PROFIT.

Gross profit margin for the six months ended June 30, 2025 was 31.6 percent compared to 30.5 percent for the prior year's corresponding period.

The gross profit margin for the six months ended June 30, 2025 was positively impacted by 110 basis points due to recent acquisitions and continuing margin expansion opportunities.

Service Centers segment.

Sales for the SC segment increased by $71.9 million, or 12.1 percent for the six months ended June 30, 2025, compared to the prior year's corresponding period.

Sales from acquisitions for the SC segment contributed $33.5 million during the period as compared to $10.2 million during the six months ended June 30, 2024.

Total sales for the SC segment excluding acquisitions increased $48.6 million from the prior year's corresponding period.

This sales increase was primarily the result of increased business activity within the majority of our regions, offset by a decrease in our North Rockies region compared to the prior year's corresponding period.

Innovative Pumping Solutions segment .

Sales for the IPS segment increased by $44.1 million, or 32.5 percent for the six months ended June 30, 2025 compared to the prior year's corresponding period.

Sales from acquisitions for the IPS segment contributed $22.2 million during the period compared to $25.0 million during the six months ended June 30, 2024.

Additionally, organic sales increased within our fabrication and global solutions division, and our water and wastewater end market, partially offset by a decrease due to the timing of project related jobs totaling $46.9 million compared to the prior year's corresponding period.

Supply Chain Services segment.

Sales for the SCS segment increased by $1.1 million, or 0.8 percent, for the six months ended June 30, 2025, compared to the prior year's corresponding period.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ("SG&A").

SG&A for the six months ended June 30, 2025 increased by approximately $26.4 million, or 13.5 percent, to $221.6 million from $195.2 million for the prior year's corresponding period.

The increase in SG&A is primarily the result of increased payroll related costs, depreciation and amortization, rent and IT expense.

OPERATING INCOME.

Operating income for the six months ended June 30, 2025 increased by $20.0 million or 30.1 percent to $86.5 million from $66.5 million in the prior year's corresponding period.

This increase in operating income was primarily driven by increases in our SC, IPS, and SCS segments.

INTEREST EXPENSE.

Interest expense for the six months ended June 30, 2025 decreased $1.5 million compared with the prior year's corresponding period.

This decrease was primarily due to the Company refinancing its Term Loan during the fourth quarter of 2024.

INCOME TAXES.

Our effective tax rate from continuing operations was a tax expense of 24.8 percent for the six months ended June 30, 2025, compared to a tax expense of 27.3 percent for the six months ended June 30, 2024, the effective tax rate decreased primarily due to an increase in changes of income earned by jurisdiction, a higher tax benefit from stock compensation vested during the period, a higher benefit from state income taxes, and higher tax benefits from research and development tax credits (R&D).

These benefits were partially offset by recognition of uncertain tax positions related to R&D tax credits.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

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GAAP financial measure (in thousands) :

Three Months Ended March 31,

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

2025 2024 2025 2024

Sales by Business Segment

Service Centers $ 339,731 $ 306,516 $ 666,806 $ 594,952

3 unchanged sentences

Acquisition Sales $ 24,605 $ 23,403 $ 55,717 35,178

$ 31,112 $ 11,775

Organic Sales $ 474,077 $ 422,153 $ 919,534 $ 823,013

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GAAP financial measure (in thousands) :

Three Months Ended March 31,

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

2025 2024 2025 2024

Net income attributable to DXP Enterprises, Inc.

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Provision for income tax expense

7,984 6,310 14,568 10,534

Depreciation and amortization

9,490 8,127 18,624 15,665

EBITDA $ 55,830 $ 46,514 $ 106,797 $ 85,152

other non-recurring items (1)

— 500 235 1,342

stock compensation expense 1,483 1,212 2,800 2,076

1 unchanged sentence

Operating Income Margin 9.2 % 8.4 % 8.9 % 7.7 %

Net Income Margin 4.7 % 3.7 % 4.5 % 3.3 %

EBITDA Margin 11.2 % 10.4 % 11.0 % 9.9 %

5 unchanged sentences

GAAP financial measure (in thousands) :

Three Months Ended March 31,

Net cash provided by (used in) operating activities

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

2025 2024 2025 2024

Net cash provided by operating activities

$ 18,646 $ 14,735 $ 21,619 $ 41,724

purchases of property and equipment (10,346) (8,825) (30,260) (11,719)

Free Cash Flow $ 8,300 $ 5,910 $ (8,641) $ 30,005

$ (16,941) $ 24,095

LIQUIDITY AND CAPITAL RESOURCES

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We continue to generate adequate cash from operating activities.

We believe that our operating cash flow, cash on hand, and other sources of liquidity including our ABL and Term Loan B, will be sufficient to allow us to continue investing in the business including capital expenditures, strategic acquisitions and investments, paying interest and servicing debt, repurchasing common stock when deemed appropriate, and manage our capital structure on a short-term and long-term basis.

We believe that our operating cash flow, cash on hand, and other sources of liquidity including our ABL and Term Loan B, will be sufficient to allow us to continue investing in the business including capital expenditures, strategic acquisitions and investments, paying interest and servicing debt, and repurchasing common stock when deemed appropriate.

Our primary source of capital is cash flow from operations, supplemented as necessary by bank borrowings or other sources of debt and existing cash balances.

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We also require cash to pay our lease obligations, fund project work-in-process and to service our debt.

As of March 31, 2025, we had available cash of $114.3 million and credit facility availability of $108.9 million.

As of June 30, 2025, we had available cash of $112.9 million and credit facility availability of $106.3 million.

We have a $135.0 million asset-backed line of credit (the "ABL Revolver"), partially offset by letters of credit of $28.7 million.

We had no borrowings outstanding on our ABL Revolver as of March 31, 2025.

We had no borrowings outstanding on our ABL Revolver as of June 30, 2025.

The following table summarizes our net cash flows provided by and used in operating activities, investing activities and financing activities for the periods presented (in thousands) :

Three Months Ended March 31,

Six Months Ended June 30,

Net Cash Provided by (Used in):

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Operating Activities

The Company generated $3.0 million of cash from operating activities during the three months ended March 31, 2025 compared to $27.0 million of cash generated during the prior year's corresponding period.

The Company generated $21.6 million of cash from operating activities during the six months ended June 30, 2025 compared to $41.7 million of cash generated during the prior year's corresponding period.

The decrease of $20.1 million was primarily due to the higher payment of income taxes in 2025 compared to 2024.

Investing Activities

For the three months ended March 31, 2025, net cash used in investing activities was $30.1 million compared to a $42.2 million million use of cash during the prior year’s corresponding period.

This $12.1 million decrease was primarily driven by lower acquisition activity during the three months ended March 31, 2025.

Total cash paid for acquisitions, net of cash acquired, was $12.9 million compared to $39.3 million for the three months ended March 31, 2024.

For the six months ended June 30, 2025, net cash used in investing activities was $41.4 million compared to a $130.7 million use of cash during the prior year’s corresponding period.

This $89.3 million decrease was primarily driven by lower acquisition activity during the six months ended June 30, 2025.

Total cash paid for acquisitions, net of cash acquired, was $13.9 million compared to $119.0 million for the six months ended June 30, 2024.

Financing Activities

For the three months ended March 31, 2025, net cash used in financing activities was $7.1 million, compared to net cash used in financing activities of $18.1 million during the prior year’s corresponding period.

The decrease was primarily due to share repurchase activity during the three months ended March 31, 2024.

For the six months ended June 30, 2025, net cash used in financing activities was $16.6 million, compared to net cash used in financing activities of $35.0 million during the prior year’s corresponding period.

The decrease was primarily due to share repurchase activity during the six months ended June 30, 2024 with no comparable activity for the six months ended June 30, 2025.

We believe the Company has adequate funding to support its working capital needs within the business.

At March 31, 2025, our total outstanding debt was $647.3 million, or 59.3 percent of total capitalization (total debt plus shareholders' equity) of $1.1 billion.

At June 30, 2025, our total outstanding debt was $645.6 million, or 58.0 percent of total capitalization (total debt plus shareholders' equity) of $1.1 billion.

$644.6 million of this outstanding debt bears interest at various floating rates.

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The following table summarizes the amount of borrowing capacity under our ABL Revolver as follows (in thousands):

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Total borrowing capacity $ 135,000 $ 135,000

1 unchanged sentence

Total amount available $ 106,308 $ 125,646

At March 31, 2025, the Company had $223.2 million of liquidity including $114.3 million in cash and $108.9 million in availability under the ABL Revolver.

At June 30, 2025, the Company had $219.2 million of liquidity including $112.9 million in cash and $106.3 million in availability under the ABL Revolver.

On July 1, 2025 the Company entered into an Increase Agreement (the “Increase Agreement”) that provided for a $185.0 million asset-backed revolving line of credit (the "ABL Revolver").

The aggregate commitments under the Company’s existing asset-based revolving credit facility (the “ABL Facility”) were increased by $50 million.

Following the effectiveness of the Increase Agreement, the total commitments under the ABL Facility increased from $135 million to $185 million.

Free Cash Flow

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The following table sets forth the reconciliation of net cash provided by operating activities to Free Cash Flow (in thousands):

Three Months Ended March 31,

Net cash provided by (used in) operating activities

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

2025 2024 2025 2024

Net cash provided by operating activities $ 18,646 $ 14,735 $ 21,619 $ 41,724

purchases of property and equipment (10,346) (8,825) (30,260) (11,719)

Free Cash Flow $ 8,300 $ 5,910 $ (8,641) $ 30,005

$ (16,941) $ 24,095

Uses of Liquidity

2 unchanged sentences

Working Capital

Working capital as of March 31, 2025 was $325.3 million, an increase of $34.3 million compared to $291.0 million as of December 31, 2024.

Working capital as of June 30, 2025 was $348.9 million, an increase of $58.0 million compared to $291.0 million as of December 31, 2024.

The increase was primarily due to sustained sales growth and acquisitions.

1 unchanged sentence

Business Acquisitions .

During March 31, 2025 and 2024, the Company invested $12.9 million and $39.3 million, respectively, in acquisitions.

During June 30, 2025 and 2024, the Company invested $13.9 million and $119.0 million, respectively, in acquisitions.

Capital Expenditures

The Company's capital expenditures was $19.9 million and $2.9 million for the three months ended March 31, 2025 and 2024, respectively.

This includes a purchase of a facility, continued facility enhancements, tools and equipment, software and technology enhancements across the Company.

The Company's capital expenditures was $30.3 million and $11.7 million for the six months ended June 30, 2025 and 2024 respectively.

This includes a purchase of a facility, continued facility upgrades and enhancements, tools and equipment, software and technology investments and enhancements across the Company.

DISCUSSION OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES

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For a more complete discussion of our significant accounting policies and business practices, refer to the consolidated Annual Report on Form 10-K filed with the SEC on March 10, 2025.

The results of operations for the three months ended March 31, 2025 are not necessarily indicative of results expected for the full fiscal year.

The results of operations for the six months ended June 30, 2025 are not necessarily indicative of results expected for the full fiscal year.

RECENT ACCOUNTING PRONOUNCEMENTS

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis