What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-08 compared with 2025-02-06 · 120 added, 72 removed, 133 unchanged (59% of the section changed)

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

Ingles, a leading supermarket chain in the Southeast, currently operates 198 supermarkets in North Carolina (75), Georgia (65), South Carolina (35), Tennessee (21), Virginia (1) and Alabama (1).

At December 28, 2024, three of the four stores temporarily closed due to damages sustained in Hurricane Helene remained closed, but they are expected to reopen during 2025.

Ingles, a leading supermarket chain in the Southeast, operates 197 supermarkets in North Carolina (75), Georgia (64), South Carolina (35), Tennessee (21), Virginia (1) and Alabama (1).

At March 29, 2025, three of the four stores temporarily closed due to damages sustained in Hurricane Helene remained closed, but they are expected to reopen at various times later during 2025 and 2026.

Ingles supermarkets offer customers a wide variety of nationally advertised food products, including grocery, meat and dairy products, produce, frozen foods and other perishables and non-food products.

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For the year ended September 28, 2024, the Company recognized an impairment loss of $30.4 million related to inventory damaged or destroyed by Hurricane Helene.

Additionally, the Company recognized a property and equipment impairment loss of $4.5 million for the year ended September 28, 2024 pertaining to the same storm, for which insurance proceeds of

$1.0 million were received during October 2024.

Additionally, the Company recognized a property and equipment impairment loss of $4.5 million for the year ended September 28, 2024 pertaining to the same storm, for which insurance proceeds of $1.5 million were received during the six months ended March 29, 2025.

These recorded losses did not include future repairs and rebuilds, nor did they account for revenue lost due to store closures or electronic payment disruptions.

The Company’s properties, including its distribution center, were impacted;

however, the distribution center returned to full operation within two weeks following the storm.

Four stores sustained damage that required that they be temporarily closed.

As of the date of this Quarterly Report on Form 10-Q, one of the four stores has reopened and the three remaining stores are currently expected to reopen during 2025.

In addition, during the quarter ended December 28, 2024, the Company incurred approximately $5.4 million in cleanup and repair costs as a result of Hurricane Helene.

As of the date of this Quarterly Report on Form 10-Q, one of the four stores temporarily closed due to hurricane impacts has reopened, and the three remaining stores are currently expected to reopen at various times later during 2025 and 2026.

In addition, during the six months ended March 29, 2025, the Company incurred approximately $6.7 million in cleanup and repair costs as a result of Hurricane Helene.

Critical Accounting Policies and Estimates

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The estimates are based on data provided by the respective claims administrators which is then applied to appropriate actuarial methods.

These estimates can fluctuate if historical trends are not accurately predictive of the future.

These estimates can fluctuate if historical trends are not predictive of the future.

The majority of the Company’s properties are self-insured for casualty losses and business interruption;

however, liability coverage is maintained.

At December 28, 2024, the Company’s self-insurance reserves totaled $36.7 million.

however, the Company maintains liability coverage.

At March 29, 2025, the Company’s self-insurance reserves totaled $37.3 million.

This amount included $3.7 million of expected self-insurance recoveries from excess cost insurance or other sources that are recorded as a receivable.

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The Company accounts for the impairment of long-lived assets in accordance with FASB ASC Topic 360.

Asset groups are primarily composed of our individual store and shopping center properties.

Asset groups are primarily composed of our individual stores and shopping center properties.

For assets to be held and used, the Company tests for impairment using undiscounted cash flows and calculates the amount of impairment using discounted cash flows.

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The recovery value is the fair value as determined by independent quotes or expected sales prices developed by internal associates, net of costs to sell.

Estimates of future cash flows and expected sales prices are judgments based upon the Company’s experience and knowledge of local operations and cash flows that are projected for several years into the future.

future cash flows and expected sales prices are judgments based upon the Company’s experience and knowledge of local operations and cash flows that are projected for several years into the future.

These estimates can fluctuate significantly due to changes in real estate market conditions, the economic environment, capital spending decisions and inflation.

The Company monitors the carrying value of long-lived assets for potential impairment each quarter based on whether any indicators of impairment have occurred.

There were no asset impairments during the three-month period ended December 28, 2024.

There were no asset impairments during the six-month period ended March 29, 2025.

Vendor Allowances

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In those instances, the allowances are applied as a reduction of merchandise costs using a rational and systematic methodology, which results in the recognition of these incentives when the inventory related to the vendor consideration received is sold.

Vendor allowances applied as a reduction of merchandise costs totaled $35.1 million and $36.8 million for the fiscal quarters ended December 28, 2024 and December 30, 2023, respectively.

Vendor allowances applied as a reduction of merchandise costs totaled $36.4 million and $35.8 million for the fiscal quarters ended March 29, 2025 and March 30, 2024, respectively.

For the six-month periods ended March 29, 2025 and March 30, 2024, vendor allowances applied as a reduction of merchandise costs totaled $71.5 million and $72.6 million, respectively.

Vendor advertising allowances that represent a reimbursement of specific identifiable incremental costs of advertising the vendor’s specific products are recorded as a reduction to the related expense in the period in which the related expense is incurred.

Vendor advertising allowances recorded as a reduction of advertising expense totaled $1.3 million and $1.9 million for the fiscal quarters ended December 28, 2024 and December 30, 2023, respectively.

Vendor advertising allowances recorded as a reduction of advertising expense totaled $2.4 million and $2.3 million for the fiscal quarters ended March 29, 2025 and March 30, 2024, respectively.

For the six-month periods ended March 29, 2025 and March 30, 2024, vendor advertising allowances recorded as a reduction of advertising expense totaled $3.7 million and $4.2 million, respectively.

If vendor advertising allowances were substantially reduced or eliminated, the Company would likely consider other methods of advertising, as well as the volume and frequency of the Company’s product advertising, which could increase or decrease the Company’s expenditures.

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Ingles operates on a 52 or 53-week fiscal year ending on the last Saturday in September.

The Condensed Consolidated Statements of Income for the three-month periods ended December 28, 2024 and December 30, 2023 both include 13 weeks of operations.

The Condensed Consolidated Statements of Income for the three and six-month periods ended March 29, 2025 and March 30, 2024 both include 13 and 26 weeks of operations, respectively.

Comparable store sales are defined as sales by retail stores in operation for five full fiscal quarters.

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A major remodel entails substantial remodeling of an existing store and includes additional retail square footage.

For the three-month period ended December 28, 2024, comparable store sales included 195 stores, which excludes the three stores that remain closed due to the impact of Hurricane Helene.

For the three-month period ended December 30, 2023, comparable store sales included 198 stores.

For the three- and six-month periods ended March 29, 2025, comparable store sales included 194 stores, which excludes the three stores that remain closed due to the impact of Hurricane Helene.

For the three- and six-month periods ended March 30, 2024, comparable store sales included 198 stores.

The following table sets forth, for the periods indicated, selected financial information as a percentage of net sales.

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Three Months Ended

Six Months Ended

Operating and administrative expenses

Gain from asset disposals

Gain from sale or disposal of assets

Income from operations

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Income tax expense

Three Months Ended December 28, 2024 Compared to the Three Months Ended December 30, 2023

Net income for the first quarter of fiscal 2025 totaled $16.6 million, compared with net income of $43.4 million for the first quarter of fiscal 2024.

Total sales, less fuel, decreased by 11.7%.

Net sales decreased by $193.0 million, or 13.0%, to $1.29 billion for the three months ended December 28, 2024 compared with $1.48 billion for the three months ended December 30, 2023.

Three Months Ended March 29, 2025 Compared to the Three Months Ended March 30, 2024

Net income for the second quarter of fiscal 2025 totaled $15.1 million, compared with net income of $31.9 million for the second quarter of fiscal 2024.

This decrease related to decreased sales and increased expenses, as described below.

Net sales decreased by $36.2 million, or 2.7%, to $1.33 billion for the three months ended March 29, 2025 compared to $1.37 billion for the three months ended March 30, 2024.

Excluding fuel sales, total grocery comparable store sales increased 0.8% over the comparative fiscal quarter.

Ingles operated 197 stores at March 29, 2025;

however, three stores damaged by Hurricane Helene remained closed at March 29, 2025.

Ingles operated 198 stores at March 30, 2024.

Sales by product category (in thousands) were as follows:

Three Months Ended

Total retail grocery

The “Grocery” category includes grocery, dairy, and frozen foods.

The “Non-foods” category includes alcoholic beverages, tobacco, pharmacy, and health/beauty/cosmetic products.

The “Perishables” category includes meat, produce, deli and bakery.

Changes in retail grocery sales for the quarter ended March 29, 2025 are summarized as follows (in thousands):

Total retail sales for the three months ended March 30, 2024

Comparable store sales decrease (including fuel)

Effect of Easter in second quarter of fiscal 2024

Impact of stores that remained closed

Impact of stores closed in fiscal 2025

Total retail sales for the three months ended March 29, 2025

Gross Profit.

Gross profit for the three-month period ended March 29, 2025 totaled $311.0 million, a decrease of $10.9 million, or 3.4%, compared with gross profit of $321.9 million for the three-month period ended March 30, 2024.

Gross profit as a percentage of sales was 23.4% and 23.5% for the three months ended March 29, 2025 and March 30, 2024, respectively.

Operating and Administrative Expenses.

Operating and administrative expenses increased by $4.4 million, or 1.5%, to $289.1 million for the three months ended March 29, 2025, from $284.8 million for the three months ended March 30, 2024.

As a percentage of sales, operating and administrative expenses were 21.8% and 20.8% for the March 2025 and March 2024 quarters, respectively.

A breakdown of the major changes in operating and administrative expenses is as follows:

(Decrease) as a

Repairs and maintenance

Professional fees

Depreciation and amortization

Repairs and maintenance increased due to the cleanup and repairs required by Hurricane Helene.

Professional fees increased due to professional services required as a result of Hurricane Helene and investsments the Company has made in its information technology systems and in technology transformation projects.

Insurance expense decreased due to lower claim volume for our self-insured employee benefit plans.

Depreciation and amortization expense increased due to acquired property and the implementation of technology systems.

Loss or Gain from Sale or Disposal of Assets.

Loss from the sale or disposal of assets totaled $0.2 million for the three months ended March 29, 2025.

Gain from the sale or disposal of assets totaled $7.7 million for the three months ended March 30, 2024, primarily from the exchange of adjacent property.

Interest Expense.

Interest expense totaled $4.9 million for the three-month period ended March 29, 2025 compared with $5.6 million for the three-month period ended March 30, 2024.

The decrease related primarily to lower interest rates applicable to our variable rate indebtedness.

Total debt at March 29, 2025 was $521.6 million compared with $539.1 million at March 30, 2024.

Income Taxes.

Income tax expense totaled $4.5 million for the three months ended March 29, 2025, reflecting an effective tax rate of 22.9% of pretax income.

Income tax expense totaled $10.7 million for the three months ended March 30, 2024, reflecting an effective tax rate of 25.1% of pretax income.

Net income totaled $15.1 million for the three-month period ended March 29, 2025 compared with $31.9 million for the three-month period ended March 30, 2024.

Basic and diluted earnings per share for Class A Common Stock were $0.81 and $0.80, respectively, for the March 2025 quarter, compared to $1.72 and $1.68, respectively, for the March 2024 quarter.

Basic and diluted earnings per share for Class B Common Stock were each $0.74 for the March 2025 quarter compared with $1.56 for the March 2024 quarter.

Six Months Ended March 29, 2025 Compared to the Six Months Ended March 30, 2024

Net income for the first half of fiscal 2025 totaled $31.7 million, compared with net income of $75.3 million for the first half of fiscal 2024.

The decrease related primarily to decreased sales and increased expenses, as described below.

Net sales decreased by $229.2 million, or 8.0%, to $2.62 billion for the six months ended March 29, 2025 compared with $2.85 billion for the six months ended March 30, 2024.

The Company estimates that approximately $55 to $65 million of revenue was lost during the three-week period immediately following the storm due to road and power outages which prevented some stores from opening or maintaining normal store hours, as well as due to electronic payment disruptions as a result of Hurricane Helene.

Excluding fuel sales, total grocery comparable store sales decreased 9.4% over the comparative fiscal quarter.

Ingles operated 198 stores at both December 28, 2024 and December 30, 2023;

however, three stores damaged by Hurricane Helene remained closed at December 28, 2024.

Changes in retail grocery sales for the quarter ended December 28, 2024 as compared to the quarter ended December 30, 2023 are summarized as follows (in thousands):

Total retail sales for the three months ended December 30, 2023

Excluding fuel sales, total grocery comparable store sales decreased 4.6% over the comparative six-month period.

Sales by product category (in thousands) were as follows:

Six Months Ended

Total retail grocery

Changes in retail grocery sales for the quarter ended March 29, 2025 are summarized as follows (in thousands):

Total retail sales for the six months ended March 30, 2024

Comparable store sales decrease (including fuel)

Impact of stores that remain closed

Total retail sales for the three months ended December 28, 2024

Effect of Easter in second quarter of fiscal 2024

Impact of stores that remained closed

Impact of stores closed in fiscal 2025

Total retail sales for the six months ended March 29, 2025

The “Grocery” category includes grocery, dairy, and frozen foods.

The “Non-foods” category includes alcoholic beverages, tobacco, pharmacy, and health/beauty/cosmetic products.

The “Perishables” category includes meat, produce, deli and bakery.

Gross Profit.

Gross profit for the three-month period ended December 28, 2024 totaled $301.1 million, a decrease of $47.7 million, or 13.7%, compared with gross profit of $348.8 million for the three-month period ended December 30, 2023.

Gross profit as a percentage of sales was 23.4% for the three months ended December 28, 2024 as compared to 23.6% for the three months ended December 30, 2023.

Retail segment gross profit, excluding fuel increased 25 basis points for the quarter ended December 28, 2024 as compared with the quarter ended December 30, 2023.

Gross profit for the six-month period ended March 29, 2025 totaled $612.1 million, a decrease of $58.6 million, or 8.7%, compared with gross profit of $670.7 million for the six-month period ended March 30, 2024.

Gross profit as a percentage of sales was 23.4% and 23.5% for the six months ended March 29, 2025 and March 30, 2024, respectively.

Operating and Administrative Expenses.

Operating and administrative expenses decreased by $9.1 million, or 3.1%, to $280.7 million for the three months ended December 28, 2024, as compared to $289.8 million for the three months ended December 30, 2023.

Operating expenses were lower as a result of the forced closure of four stores due to the impact of Hurricane Helene, which temporarily reduced number of associates due to their inability to return, or regularly return, to work for several weeks after the storm, and our receipt of $1.0 million of insurance proceeds related to property loss due to Hurricane Helene.

The reduction in operating expenses was partially offset by approximately $5.4 million of cleanup and repair costs incurred as a result of Hurricane Helene.

As a percentage of sales, operating and administrative expenses were 21.8% and 19.6% for the December 2024 and December 2023 quarters, respectively.

Excluding fuel sales and associated fuel operating expenses (primarily payroll), operating expenses were 24.3% of sales for the first fiscal quarter of 2025 compared with 22.0% for the first fiscal quarter of 2024.

Operating and administrative expenses decreased by $4.7 million, or 0.8%, to $569.9 million for the six months ended March 29, 2025, from $574.6 million for the six months ended March 30, 2024.

As a percentage of sales, operating and administrative expenses were 21.8% and 20.2% for the March 2025 and March 2024 six-month periods, respectively.

A breakdown of the major changes in operating and administrative expenses is as follows:

Increase as a

Salaries and wages

Repairs and maintenance

Depreciation and amortization

Professional fees

Salaries and wages decreased in dollars due to the impact of Hurricane Helene, including the temporary closure of four stores, of which three currently remain closed, disruption at other stores due to storm-related power losses and difficulties for associates to get to work due to the damages caused by Hurricane Helene.

Depreciation and amortization

Salaries and wages decreased due to the impact of Hurricane Helene, including the temporary closure of four stores, of which three currently remain closed, disruption at other stores due to storm-related power losses and difficulties for associates to get to work due to the damages caused by Hurricane Helene .

Repairs and maintenance expense increased due to the cleanup and repairs required by Hurricane Helene.

Bank charges decreased due to decreased activity related to loss of internet connectivity after the storm, which temporarily disrupted the ability to accept credit and debit cards.

Depreciation and amortization increased due to acquired real property and implementation of information technology systems and upgrades.

Professional fees increased in dollars due to professional services required as a result of Hurricane Helene and investments the Company has made in its information technology systems and in technology transformation projects.

Other Income.

Other income totaled $3.3 million for the three months ended December 28, 2024 compared with $3.6 million for the three months ended December 30, 2023.

Professional fees increased due to professional services required as a result of Hurricane Helene and investments the Company has made in its information technology systems and in technology transformation projects.

Depreciation and amortization increased due to acquired property and implementation of information technology systems and upgrades.

Gain from Sale or Disposal of Assets.

Gain from the sale or disposal of assets totaled $3.0 million for the six months ended March 29, 2025, as compared to $8.3 million for the six months ended March 30, 2024.

Interest Expense.

Interest expense totaled $5.0 million for the three-month period ended December 28, 2024 compared with $5.7 million for the three-month period ended December 30, 2023.

Total debt at December 28, 2024 was $529.4 million compared with $546.9 million at December 30, 2023.

Interest expense totaled $9.9 million for the six-month period ended March 29, 2025 compared with $11.3 million for the six -month period ended March 30, 2024.

The decrease related primarily to lower interest rates applicable to our variable rate indebtedness.

Total debt at March 29, 2025 was $521.6 million compared with $539.1 million at March 30, 2024.

Income Taxes.

Income tax expense totaled $5.3 million for the three months ended December 28, 2024, reflecting an effective tax rate of 24.1% of pretax income.

Income tax expense totaled $14.1 million for the three months ended December 30, 2023, reflecting an effective tax rate of 24.6% of pretax income.

Net income totaled $16.6 million for the three-month period ended December 28, 2024 compared with $43.4 million for the three-month period ended December 30, 2023.

Basic and diluted earnings per share for Class A Common Stock were $0.89 and $0.87, respectively, for the December 2024 quarter, compared to $2.33 and $2.28, respectively, for the December 2023 quarter.

Basic and diluted earnings per share for Class B Common Stock were each $0.81 for the December 2024 quarter compared with $2.12 for the December 2023 quarter.

Income tax expense totaled $9.8 million for the six months ended March 29, 2025, reflecting an effective tax rate of 23.6% of pretax income.

Income tax expense totaled $24.8 million for the six months ended March 30, 2024, reflecting an effective tax rate of 24.8% of pretax income.

Net income totaled $31.7 million for the six-month period ended March 29, 2025 compared with $75.3 million for the six-month period ended March 30, 2024.

Basic and diluted earnings per share for Class A Common Stock were $1.70 and $1.67, respectively, for the six months ended March 29, 2025, compared to $4.05 and $3.96, respectively, for the six months ended March 30, 2024.

Basic and diluted earnings per share for Class B Common Stock were each $1.55 for the six months ended March 29, 2025 compared with $3.68 for the six months ended March 30, 2024.

Liquidity and Capital Resources

Capital Expenditures

Capital expenditures totaled $37.8 million for the three-month period ended December 28, 2024.

The Company’s capital expenditures included the continued construction of a new store opening in 2025, the expansion and remodeling of existing stores, the acquisition of sites, new technology, and upgrades of the Company’s transportation fleet and facilities.

Capital expenditures totaled $62.0 million for the six-month period ended March 29, 2025.

The Company’s capital expenditures included the continued construction of a new store, restoration work on one of the remaining three temporarily closed stores due to Hurricane Helene, the expansion and remodeling of existing stores, the acquisition of sites, new technology, and upgrades of the Company’s transportation fleet and facilities .

The Company’s capital expenditure plans for fiscal 2025 currently include investments of approximately $120 to $160 million.

The Company currently plans to dedicate the majority of its fiscal 2025 capital expenditures to continued improvement of its store base, including the re-opening of the stores temporarily closed due to Hurricane Helene, remodeling and continued investment in one store expected to open in fiscal 2025, as well as technology improvements, upgrading and replacing existing store, warehouse and transportation equipment and improvements to the Company’s milk processing plant.

Notwithstanding higher anticipated capital expenditures for fiscal 2025, the Company currently expects that its annual capital expenditures will be in the range of approximately $100 to $160 million going forward to maintain a modern store base.

The Company currently expects that its annual capital expenditures will be in the range of approximately $120 to $160 million going forward in order to maintain a modern store base and to re-open the remaining temporarily closed stores.

Among other things, planned expenditures for any given future fiscal year will be affected by the availability of financing, which can affect both the number of projects pursued at any given time and the cost of those projects.

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The Company does not generally enter into commitments for capital expenditures other than on a store-by-store basis at the time it begins construction on a new store or begins a major or minor remodeling project.

The Company used $43.6 million net cash for operations for the three months ended December 28, 2024 compared with $15.5 million provided by operations for the three months ended December 30, 2023.

The decrease was primarily attributable to lower net income and higher working capital needs .

Cash used by investing activities for the three-month periods ended December 28, 2024 and December 30, 2023 totaled $33.9 million and $62.4 million, respectively, primarily related to reduced capital expenditures.

Cash used by financing activities totaled $6.7 million for both the three-month periods ended December 28, 2024 and December 30, 2023.

The Company generated $19.4 million net cash from operations for the six months ended March 29, 2025 compared with $85.9 million for the six months ended March 30, 2024.

Cash from operations decreased by $66.6 million due to lower net income for the six months ended March 29, 2025 compared with the six months ended March 30, 2024 due to reduced income and increases in working capital needs.

Cash used by investing activities for the six-month periods ended March 29, 2025 and March 30, 2024 totaled $57.9 million and $94.6 million, respectively, consisting primarily of capital expenditures.

Cash used by financing activities totaled $17.9 million for both the six-month periods ended March 29, 2025 and March 30, 2024.

In June 2021, the Company issued $350.0 million aggregate principal amount of senior notes due 2031 (the “Notes”).

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The Line provides the Company with various interest rate options based on the prime rate, the Federal Funds Rate, or SOFR.

The Line allows the Company to issue up to $10.0 million in letters of credit, of which none were issued at December 28, 2024.

The Line allows the Company to issue up to $10.0 million in letters of credit, of which $500,000 was issued at March 29, 2025.

The Company is not required to maintain compensating balances in connection with the Line.

At December 28, 2024, the Company had no borrowings outstanding under the Line.

In December 2010, the Company completed the funding of $99.7 million of bonds (the “Bonds”) for the construction of new warehouse and distribution space in Buncombe County, North Carolina (the “Project”).

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Mandatory redemption of the Bonds by the Company in the annual amount of $4.5 million began on January 1, 2014.

The outstanding balance of the Bonds was $49.9 million as of December 28, 2024.

The outstanding balance of the Bonds was $45.4 million as of March 29, 2025.

The Company may redeem the Bonds without penalty or premium at any time prior to December 17, 2029.

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The Company’s long-term debt agreements generally contain provisions that under certain circumstances would permit lending institutions to terminate or withdraw their respective extensions of credit to the Company.

Included among the triggering factors permitting the termination or withdrawal of the Line are certain events of default, including both monetary and non-monetary defaults,

the initiation of bankruptcy or insolvency proceedings, or the failure of the Company to meet certain financial covenants designated in its loan documents.

As of December 28, 2024, the Company was in compliance with these covenants.

Included among the triggering factors permitting the termination or withdrawal of the Line are certain events of default, including both monetary and non-monetary defaults, the initiation of bankruptcy or insolvency proceedings, or the failure of the Company to meet certain financial covenants designated in its loan documents.

As of March 29, 2025, the Company was in compliance with these covenants.

The Company’s principal sources of liquidity are expected to be cash flow from operations, borrowings under the Line and long-term debt financing.

The Company believes, based on its current results of operations and financial condition, that its financial resources, including the Line, short- and long-term financing expected to be available to it and operating cash flow, will be sufficient to meet planned capital expenditures and working capital requirements for the foreseeable future, including any debt service requirements of additional borrowings.

additional borrowings.

However, there is no assurance that any such sources of financing will be available to the Company when needed on acceptable terms, or at all.

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Twelve Months Ended

December 2024

Forward-Looking Statements

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Some of these assumptions inevitably will not materialize, and unanticipated events will occur which will affect the Company’s results.

Some important factors (but not necessarily all factors) that affect the Company’s revenues, financial position, growth strategies, profitability and operating results, or that otherwise could cause actual results to differ materially from those expressed in or implied by any forward-looking statement, include the resurgence of the

COVID-19 pandemic or variants of the virus on our business and economic conditions generally in the Company’s operating area;

the Company’s ability to successfully implement its expansion and operating strategies and to manage rapid expansion;

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changes in accounting policies, standards, guidelines or principles as may be adopted by regulatory agencies as well as the Financial Accounting Standards Board;

and those factors contained under the heading “Risk Factors” in Item 1A of Part I of our most recent Annual Report on Form 10-K for the year ended September 28, 2024, filed by the Company under the Exchange Act, on December 27, 2024 .

factors contained under the heading “Risk Factors” in Item 1A of Part I of our most recent Annual Report on Form 10-K for the year ended September 28, 2024, filed by the Company under the Exchange Act, on December 27, 2024.

Consequently, actual events affecting the Company and the impact of such events on the Company’s operations may vary significantly from those described in this Quarterly Report on Form 10-Q or contemplated or implied by statements in this Quarterly Report on Form 10-Q.

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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