SANFILIPPO JOHN B & SON INC 10-K

Item 8 — Financial Statements and Supplementary Data Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of John B. Sanfilippo & Son, Inc. Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of John B. Sanfilippo & Son, Inc. and its subsidiaries (the “Company”) as of June 26, 2025 and June 27, 2024, and the related consolidated statements of comprehensive income, of stockholders’ equity and of cash flows for each of the three years in the period ended June 26, 2025, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of June 26, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of June 26, 2025 and June 27, 2024, and the results of its operations and its cash flows for each of the three years in the period ended June 26, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of June 26, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. Basis for Opinions The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 35 Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Valuation of the Projected Benefit Obligation related to the Supplemental Employee Retirement Plan (SERP) As described in Note 15 to the consolidated financial statements, the Company’s projected benefit obligation related to the SERP is $28.7 million as of June 26, 2025. The SERP is an unfunded, non-qualified benefit plan that will provide eligible participants with monthly benefits upon retirement, disability or death, subject to certain conditions. Benefits paid to retirees are based on age at retirement, years of credited service, and average compensation. The most significant assumption related to the Company’s SERP is the discount rate used to calculate the actuarial present value of benefit obligations to be paid in the future. The principal considerations for our determination that performing procedures relating to the valuation of the projected benefit obligation related to the SERP is a critical audit matter are (i) the significant judgment by management to determine the projected benefit obligation and the significant assumption related to discount rate, (ii) the significant auditor judgment, subjectivity and effort in evaluating management’s significant assumption related to the discount rate, and (iii) the audit effort included the use of professionals with specialized skill and knowledge. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the Company’s determination of the projected benefit obligation related to the SERP, including the control over the development of the significant assumption related to the discount rate. These procedures also included, among others (i) testing management’s process for determining the projected benefit obligation, (ii) evaluating the appropriateness of the valuation method, (iii) testing the completeness and accuracy of underlying data used in the valuation of the projected benefit obligation, and (iv) evaluating the reasonableness of the discount rate. Evaluating management’s assumption related to the discount rate involved evaluating whether the assumption used by management is reasonable considering the consistency with external market data. Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the valuation method and the reasonableness of the discount rate. /s/ PricewaterhouseCoopers LLP Chicago, Illinois August 20, 2025 We have served as the Company’s auditor since 1982. 36 JOHN B. SANFILIPPO & SON, INC. CONSOLIDATED BALANCE SHEETS June 26, 2025 and June 27, 2024 (dollars in thousands, except share and per share amounts) June 26, 2025 June 27, 2024 ASSETS CURRENT ASSETS: Cash $ 585 $ 484 Accounts receivable, less allowance for doubtful accounts of $ 293 and $ 318 , respectively 76,656 84,960 Inventories 254,600 196,563 Prepaid expenses and other current assets 14,583 12,078 TOTAL CURRENT ASSETS 346,424 294,085 PROPERTY, PLANT AND EQUIPMENT: Land 13,365 13,365 Buildings 119,315 115,517 Machinery and equipment 326,984 295,599 Furniture and leasehold improvements 5,540 5,423 Vehicles 1,228 912 Construction in progress 7,223 7,569 473,655 438,385 Less: Accumulated depreciation 308,506 287,168 165,149 151,217 Rental investment property, less accumulated depreciation of $ 16,053 and $ 15,246 , respectively 13,070 13,877 TOTAL PROPERTY, PLANT AND EQUIPMENT 178,219 165,094 OTHER LONG TERM ASSETS: Intangible assets, net 4,428 5,822 Deferred income taxes 5,782 3,130 Goodwill 11,750 11,750 Operating lease right-of-use assets 27,824 27,404 Other assets 23,176 8,290 TOTAL ASSETS $ 597,603 $ 515,575 The accompanying notes are an integral part of these consolidated financial statements. 37 JOHN B. SANFILIPPO & SON, INC. CONSOLIDATED BALANCE SHEETS June 26, 2025 and June 27, 2024 (dollars in thousands, except share and per share amounts) June 26, 2025 June 27, 2024 LIABILITIES & STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Revolving credit facility borrowings $ 57,584 $ 20,420 Current maturities of long-term debt, net, including related party debt of $ 808 and $ 737 , respectively and net of unamortized debt issuance costs of $ 2 and $ 0 , respectively 941 737 Accounts payable 60,479 53,436 Bank overdraft 294 545 Accrued payroll and related benefits 18,446 35,601 Other accrued expenses 18,302 15,201 TOTAL CURRENT LIABILITIES 156,046 125,940 LONG-TERM LIABILITIES: Long-term debt, less current maturities, net, including related party debt of $ 5,557 and $ 6,365 , respectively and net of unamortized debt issuance costs of $ 123 and $ 0 , respectively 14,564 6,365 Retirement plan 27,921 26,154 Long-term operating lease liabilities, net of current portion 24,224 24,877 Long-term workers' compensation liabilities 10,603 7,673 Other 3,548 1,953 TOTAL LONG-TERM LIABILITIES 80,860 67,022 TOTAL LIABILITIES 236,906 192,962 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS’ EQUITY: Class A Common Stock, convertible to Common Stock on a per share basis, cumulative voting rights of ten votes per share, $ .01 par value; 10,000,000 shares authorized, 2,597,426 shares issued and outstanding 26 26 Common Stock, non-cumulative voting rights of one vote per share, $ .01 par value; 17,000,000 shares authorized, 9,161,348 and 9,123,938 shares issued, respectively 92 91 Capital in excess of par value 139,724 135,691 Retained earnings 221,495 186,965 Accumulated other comprehensive income 564 1,044 Treasury stock, at cost; 117,900 shares of Common Stock ( 1,204 ) ( 1,204 ) TOTAL STOCKHOLDERS’ EQUITY 360,697 322,613 TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY $ 597,603 $ 515,575 The accompanying notes are an integral part of these consolidated financial statements. 38 JOHN B. SANFILIPPO & SON, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the years ended June 26, 2025, June 27, 2024 and June 29, 2023 (dollars in thousands, except share and per share amounts) Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Net sales $ 1,107,246 $ 1,066,783 $ 999,686 Cost of sales 903,775 852,644 788,055 Gross profit 203,471 214,139 211,631 Operating expenses: Selling expenses 78,934 82,694 76,803 Administrative expenses 39,826 48,484 44,604 Bargain purchase gain, net — ( 2,226 ) — Total operating expenses 118,760 128,952 121,407 Income from operations 84,711 85,187 90,224 Other expense: Interest expense including $ 626 , $ 691 and $ 750 to related parties, respectively 3,552 2,549 2,159 Rental and miscellaneous expense, net 1,849 1,301 1,321 Pension expense (excluding service costs) 1,445 1,400 1,394 Total other expense, net 6,846 5,250 4,874 Income before income taxes 77,865 79,937 85,350 Income tax expense 18,931 19,688 22,493 Net income 58,934 60,249 62,857 Other comprehensive income, net of tax: Amortization of actuarial loss included in net periodic pension cost — — 21 Net actuarial (loss) gain arising during the period ( 480 ) 1,248 2,255 Other comprehensive (loss) income, net of tax ( 480 ) 1,248 2,276 Comprehensive income $ 58,454 $ 61,497 $ 65,133 Net income per common share — basic $ 5.06 $ 5.19 $ 5.43 Net income per common share — diluted $ 5.03 $ 5.15 $ 5.40 Cash dividends declared per share $ 2.10 $ 3.00 $ 4.75 Weighted average shares outstanding — basic 11,655,506 11,615,255 11,576,852 Weighted average shares outstanding — diluted 11,724,433 11,687,546 11,642,046 The accompanying notes are an integral part of these consolidated financial statements 39 JOHN B. SANFILIPPO & SON, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY For the years ended June 26, 2025, June 27, 2024 and June 29, 2023 (dollars in thousands, except per share amounts) Accumulated Class A Capital in Other Common Stock Common Stock Excess of Retained Comprehensive Treasury Shares Amount Shares Amount Par Value Earnings Loss (Income) Stock Total Balance, June 30, 2022 2,597,426 $ 26 9,047,359 $ 90 $ 128,800 $ 153,589 $ ( 2,480 ) $ ( 1,204 ) $ 278,821 Net income 62,857 62,857 Cash dividends ($ 4.75 per Class A and Common share) ( 54,934 ) ( 54,934 ) Pension liability amortization, net of income tax expense of $ 7 21 21 Pension liability adjustment, net of income tax expense of $ 752 2,255 2,255 Equity award exercises, net of shares withheld for employee taxes 28,967 1 ( 379 ) ( 378 ) Stock-based compensation expense 3,565 3,565 Balance, June 29, 2023 2,597,426 $ 26 9,076,326 $ 91 $ 131,986 $ 161,512 $ ( 204 ) $ ( 1,204 ) $ 292,207 Net income 60,249 60,249 Cash dividends ($ 3.00 per Class A and Common share) ( 34,796 ) ( 34,796 ) Pension liability adjustment, net of income tax expense of $ 415 1,248 1,248 Equity award exercises, net of shares withheld for employee taxes 47,612 — ( 684 ) ( 684 ) Stock-based compensation expense 4,389 4,389 Balance, June 27, 2024 2,597,426 $ 26 9,123,938 91 $ 135,691 $ 186,965 $ 1,044 $ ( 1,204 ) $ 322,613 Net income 58,934 58,934 Cash dividends ($ 2.10 per Class A and Common share) ( 24,404 ) ( 24,404 ) Pension liability adjustment, net of income tax benefit of $ 160 ( 480 ) ( 480 ) Equity award exercises, net of shares withheld for employee taxes 37,410 1 ( 490 ) ( 489 ) Stock-based compensation expense 4,523 4,523 Balance, June 26, 2025 2,597,426 $ 26 9,161,348 $ 92 $ 139,724 $ 221,495 $ 564 $ ( 1,204 ) $ 360,697 The accompanying notes are an integral part of these consolidated financial statements. 40 JOHN B. SANFILIPPO & SON, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS For the years ended June 26, 2025, June 27, 2024 and June 29, 2023 (dollars in thousands) Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 58,934 $ 60,249 $ 62,857 Depreciation and amortization 26,930 24,581 20,513 Amortization of operating lease right-of-use assets 4,539 2,023 1,625 Loss on disposition of properties, net 1,450 558 281 Deferred income tax benefit ( 2,492 ) ( 704 ) ( 1,115 ) Stock-based compensation expense 4,523 4,389 3,565 Bargain purchase gain, net — ( 2,226 ) — Loss on previously held equity investment — — 1,000 Change in assets and liabilities, net of Acquisitions: Accounts receivable, net 8,342 ( 12,106 ) ( 3,123 ) Inventories ( 58,037 ) 11,873 32,159 Prepaid expenses and other current assets ( 2,613 ) ( 4,216 ) 1,471 Accounts payable 6,838 10,558 ( 5,036 ) Accrued expenses ( 14,955 ) 8,407 9,946 Income taxes receivable/payable 108 ( 1,944 ) ( 104 ) Other long-term liabilities ( 186 ) ( 896 ) ( 162 ) Other long-term assets ( 4,186 ) ( 59 ) ( 529 ) Other, net 1,350 1,186 1,307 Net cash provided by operating activities 30,545 101,673 124,655 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment ( 50,712 ) ( 28,312 ) ( 20,732 ) Business acquisitions, net — ( 58,974 ) ( 3,500 ) Other, net ( 109 ) ( 63 ) ( 55 ) Net cash used in investing activities ( 50,821 ) ( 87,349 ) ( 24,287 ) CASH FLOWS FROM FINANCING ACTIVITIES: Net short-term borrowings (repayments) 37,164 20,420 ( 40,439 ) Principal payments on long-term debt ( 737 ) ( 672 ) ( 3,154 ) (Decrease) increase in bank overdraft ( 251 ) 260 71 Dividends paid ( 24,404 ) ( 34,796 ) ( 54,934 ) Proceeds from issuance of debt 9,265 — — Debt issue costs ( 170 ) ( 316 ) — Taxes paid related to net share settlement of equity awards ( 490 ) ( 684 ) ( 379 ) Net cash provided by (used in) financing activities 20,377 ( 15,788 ) ( 98,835 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 101 ( 1,464 ) 1,533 Cash and cash equivalents, beginning of period 484 1,948 415 Cash and cash equivalents, end of period $ 585 $ 484 $ 1,948 Supplemental disclosures of cash flow information: Interest paid $ 3,290 $ 2,370 $ 2,116 Income taxes paid, excluding refunds of $ 53 , $ 227 and $ 120 , respectively 21,136 22,214 23,427 The accompanying notes are an integral part of these consolidated financial statements. 41 JOHN B. SANFILIPPO & SON, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands, except per share data) NOTE 1 — SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Consolidation and Description of Business Our consolidated financial statements include the accounts of John B. Sanfilippo & Son, Inc., and our wholly-owned subsidiary, JBSS Ventures, LLC. Our fiscal year ends on the last Thursday of June each year, and typically consists of fifty-two weeks (four thirteen-week quarters). The accompanying consolidated financial statements and related footnotes are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We are one of the leading processors and distributors of peanuts, pecans, cashews, walnuts, almonds and other nuts in the United States, and we also manufacture and distribute a complete portfolio of private brand snack and nutrition bars (“bars”). These nuts are primarily sold under a variety of private brand names, as well as our Fisher , Orchard Valley Harvest , Squirrel Brand and Southern Style Nuts brand names. We market and distribute, and in most cases, manufacture or process, a diverse product line of food and snack products, including bars, peanut butter, almond butter, cashew butter, candy and confections, snack and trail mixes, granola, sunflower kernels, dried fruit, corn snacks, sesame sticks, other sesame snack products and baked cheese snack products under our brand names, including Just the Cheese , and under private brands. Our products are sold through three primary distribution channels, including food retailers in the consumer channel, commercial ingredient users and contract manufacturing customers. Management Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include reserves for customer deductions, the quantity of bulk inventories, the evaluation of recoverability of long-lived assets and the assumption used in estimating the annual discount rate utilized in determining the retirement plan liability. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include cash on-hand and may periodically include money market instruments that are highly liquid investments. Cash and cash equivalents are carried at cost, which approximates fair value. Accounts Receivable Accounts receivable are stated at the amounts charged to customers less allowances for doubtful accounts and reserves for estimated cash discounts and customer deductions. The allowance for doubtful accounts is calculated by specifically identifying customers that are credit risks and estimating the extent that other non-specifically identified customers will become credit risks. Account balances are charged off against the allowance when we conclude that it is probable the receivable will not be recovered. Bad debt expense was $ 0 , $ 114 and $ 54 for the years ended June 26, 2025, June 27, 2024 and June 29, 2023 , respectively. The reserve for estimated cash discounts is based on historical experience. The reserve for customer deductions represents known customer short payments and an estimate of future credit memos that will be issued to customers related to rebates and allowances for marketing and promotions based on agreed upon programs and historical experience. Inventories Inventories, which consist principally of inshell bulk-stored nuts, shelled nuts, dried fruit, processed and packaged nut products and bars are stated at the lower of cost (first-in, first-out) and net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Inventory costs are reviewed at least quarterly. Fluctuations in the market price of pecans, peanuts, walnuts, almonds, cashews and other nuts and ingredients may affect the value of inventory, gross profit and gross profit margin. When net realizable values move below costs, we record adjustments to write down the carrying values of inventories to the lower of cost (first-in, first-out) and net realizable value. The results of our shelling process can also result in changes to inventory costs, such as adjustments made pursuant to actual versus expected crop yields. We maintain significant inventories of bulk-stored inshell pecans, peanuts and walnuts. Quantities of inshell bulk-stored nuts are determined based o n our inventory systems and are subject to quarterly physical verification techniques including observation, weighing and other methods. The quantities of each crop year bulk-stored nut inventories are generally shelled out over a ten to fifteen-month period, at which time revisi ons to any estimates, which historically averaged less than 1.0 % of inventory purchases, are also recorded. 42 We enter into walnut purchase agreements with growers typically in our first fiscal quarter, under which they deliver their walnut crop to us during the fall harvest season (which typically occurs in our first and second fiscal quarters). Pursuant to our walnut purchase agreements, we determine the final price for this inventory after receipt and typically by the end of our third fiscal quarter. Since the ultimate purchase price to be paid is determined subsequent to receiving the walnut crop, we typically estimate the final purchase price for our first and second quarter interim financial statements based on crop size, quality, current market prices and other factors. Any such changes in estimates, which could be significant, are accounted for in the period of change by adjusting inventory on hand or cost of goods sold if the inventory has been sold. Changes in estimates may affect the ending inventory balances, as well as gross profit. There were no significant adjustments recorded in any of the periods presented. Property, Plant and Equipment Property, plant and equipment are stated at cost and are all located in the United States. Major improvements that extend the useful life, add capacity or add functionality are capitalized and charged to expense through depreciation. Repairs and maintenance costs are charged to expense as incurred. The cost and accumulated depreciation of assets sold or retired are removed from the respective accounts, and any gain or loss is recognized currently in operating income. Depreciation expense for the last three fiscal years is as follows: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Depreciation expense $ 25,536 $ 22,895 $ 18,746 Cost is depreciated using the straight-line method over the following estimated useful lives: Classification Estimated Useful Lives Buildings 10 to 30 years Machinery and equipment 5 to 10 years Furniture and leasehold improvements 5 to 10 years Vehicles 3 to 5 years Computers and software 3 to 10 years On June 16, 2025, the Company entered into the Equipment Loan (as defined in Note 8 — “Long-Term Debt” below). In accordance with the provisions of ASC 835, Interest , the Company capitalizes interest costs incurred during the construction period of qualifying assets as part of the asset’s acquisition cost, therefore, interest costs incurred directly attributable to the Equipment Loan will be capitalized. The capitalized interest will be included in the carrying amount of the related assets and depreciated over their estimated useful lives once the assets are placed into service. We capitalized interest using the SOFR plus 1.60% interest rate on the equipment loan upon the first disbursement of the loan proceeds following the execution of the Equipment Loan. The interest capitalized in fiscal 2025 was immaterial. No interest costs were capitalized for fiscal 2024 or fiscal 2023 because no significant project required such capitalization. Equipment deposits paid on long term capital projects were $ 12,438 and $ 1,782 at June 26, 2025 and June 27 , 2024 , respectively, and are included in Other long term assets in the accompanying Consolidated Balance Sheets. Business Combinations We use the acquisition method in accounting for acquired businesses. Under the acquisition method, our financial statements reflect the operations of an acquired business starting from the completion of the acquisition. The assets acquired and liabilities assumed are recorded at their respective estimated fair values at the date of the acquisition. Any excess of the purchase price over the estimated fair values of the identifiable net assets acquired is recorded as goodwill. Segment Reporting We operate in a single reporting unit and operating segment that consists of selling various nut and nut related products and bars through three distribution channels with a similar distribution model. See Note 17 — “ Segment Reporting” below for additional information. 43 Valuation of Long-Lived Assets and Other Intangible Assets We review held and used long-lived assets, including our rental investment property and amortizable identifiable intangible assets (e.g., customer relationships and brand names), to assess recoverability from projected undiscounted cash flows whenever events or changes in facts and circumstances indicate that the carrying value of the assets may not be recoverable. When such events occur, we compare the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group to the carrying amount of the long-lived asset or asset group. The cash flows are based on our best estimate of future cash flows derived from the most recent business projections. If this comparison indicates there is an impairment, the carrying value of the asset is reduced to its estimated fair value. We did no t record any impairment of long-lived assets for the last t hree fiscal years. Intangible assets are initially recorded at fair value in business acquisitions, which include customer relationships, brand names, formulas and non-compete agreements and are amortized over their estimated useful lives. Certain assets are amortized on an accelerated basis based on the timing of expected future benefits. See Note 6 — “Goodwill an d Intangible Assets” below for additional information. Goodwill Goodwill currently represents the excess of the purchase price over the fair value of the net assets from our fiscal 2018 acquisition of Squirrel Brand, L.P. and our fiscal 2023 acquisition of the Just the Cheese brand. Goodwill is no t amortized, but is tested annually as of the last day of each fiscal year for impairment, or whenever events or changes in circumstances indicate it is more likely than not that the carrying amount of the reporting unit is greater than its fair value. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include deterioration in general economic conditions, adverse changes in the markets in which we operate, increases in input costs that have negative effects on earnings and cash flows, or a trend of negative or declining cash flows over multiple periods, among others. The fair value that could be realized in an actual transaction may differ from that used to evaluate the impairment of goodwill. In testing goodwill for impairment, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not (more than 50%) that the estimated fair value of our single reporting unit is less than its carrying amount. If we elect to perform a qualitative assessment and determine that an impairment is more likely than not, we are then required to perform a quantitative impairment test, otherwise no further analysis is required. We also may elect not to perform the qualitative assessment and, instead, proceed directly to the quantitative impairment test. Under the goodwill qualitative assessment, various events and circumstances that would affect the estimated fair value of our single reporting unit are identified (similar to the impairment indicators above). During fiscal 2025, we performed a qualitative impairment test which considered the totality of all relevant events or circumstances that affect the fair value or carrying amount of our reporting unit. This qualitative test concluded it is more likely than not that the fair value is greater than its carrying amount. Under the goodwill quantitative impairment test, the evaluation of impairment involves comparing the current fair value of our single reporting unit to its carrying value, including goodwill. We estimate the fair value using level 3 inputs as defined by the fair value hierarchy. The inputs used to estimate fair value include several subjective factors, such as estimates of future cash flows, estimates of our future cost structure, discount rates for our estimated cash flows, required level of working capital, assumed terminal value and time horizon of cash flow forecasts. Our market capitalization is also an estimate of fair value that is considered in our qualitative impairment analysis which is a level 1 input in the fair value hierarchy. If the carrying value of our single reporting unit exceeds its fair value, we recognize an impairment loss equal to the difference between the carrying value and estimated fair value. Elgin Rental Property In April 2005, we acquired property to be used for the Elgin Site. Two buildings are located on the Elgin Site, one of which is an office building. Approximately 84 % of the rentable area in the office building is currently vacant. Approximately 29 % of the rentable area has not been built-out. The other building, a warehouse, was expanded and modified for use as our principal processing facility and headquarters. The allocation of the purchase price to the two buildings was determined through a third-party appraisal. The value assigned to the office building is included in rental investment property on the balance sheet. The value assigned to the manufacturing building is included in the caption “Property, plant and equipment”. The net rental expense from the office building is included in the caption “Rental and miscellaneous expense, net”. See Note 4 — “Leases” below for additional information. 44 Fair Value of Financial Instruments Authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) defines fair value as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The guidance establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels: Level 1- Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. Level 2- Observable inputs other than quoted prices in active markets. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets. Level 3- Unobservable inputs for which there is little or no market data available. The carrying values of cash, cash equivalents, trade accounts receivable and accounts payable approximate their fair values at June 26, 2025 and June 27, 2024 because of the short-term maturities and nature of these balances. The carrying value of our Credit Facility (as defined in Note 7 — “Revolving Credit Facility” below) borrowings approximates fair value at June 26, 2025 and June 27, 2024 because interest rates on this instrument approximate current market rates (Level 2 criteria), the short-term maturity and nature of this balance. In addition, there has been no significant change in our inherent credit risk. The following table summarizes the carrying value and fair value estimate of our current and long-term debt, excluding unamortized debt issuance costs: June 26, 2025 June 27, 2024 Carrying value of current and long-term debt: $ 15,630 $ 7,102 Fair value of current and long-term debt: 15,329 6,496 The estimated fair value of our current and long-term debt was determined using a market approach based upon Level 2 observable inputs, which estimates fair value based on interest rates currently offered on loans with similar terms to borrowers of similar credit quality or broker quotes. In addition, there have been no significant changes in the underlying assets securing our long-term debt. Revenue Recognition The Company records revenue based on a five-step model in accordance with ASC Topic 606, Revenue from Contracts with Customers . The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for the goods or services. We sell our products under some arrangements which include customer contracts that fix the sales price for periods, which typically can be up to one year for some commercial ingredient customers. We also sell our products through specific programs consisting of promotion allowances, volume and customer rebates and marketing allowances, among others, to consumer and some commercial ingredient users. We recognize revenues as performance obligations are fulfilled, which occurs when control passes to our customers. We report all amounts billed to a customer in a sale transaction as revenue, including those amounts related to shipping and handling. We reduce revenue for estimated promotion allowances, volume and customer rebates and marketing allowances, among others. These reductions in revenue are considered variable consideration and are recorded in the same period the related sales are recorded. Such estimates are calculated using historical averages adjusted for any expected changes due to current business conditions and experience. See Note 3 — “Reve nue Recognition” below for additional information on revenue recognition. Significant Customers and Concentration of Credit Risk The highly competitive nature of our business provides an environment for the loss of customers and the opportunity to gain new customers. We are subject to concentrations of credit risk, primarily in trade accounts receivable, and we attempt to mitigate this risk through our credit evaluation process, collection terms and through geographical dispersion of sales. Sales to two customers exceeded 10 % of net sales during fiscal 2025, fiscal 2024 and fiscal 2023 . In total, sales to these two customers represented approximately 51 % , 52 % and 51 % of our net sales in fiscal 2025, fiscal 2024 and fiscal 2023, respectively. In total, net accounts receivable from these customers were 52 % and 47 % of net accounts receivable at June 26, 2025 and June 27, 2024, respectively. Net sales to customers in foreign countries, primarily Canada, was approximately 1 % during all fiscal years presented . 45 Marketing and Advertising Costs Marketing and advertising costs, including consumer insight research and related consulting expenses, are incurred to promote and support branded products primarily in the consumer distribution channel. These costs are generally expensed as incurred, recorded in selling expenses and were as follows for the last three fiscal years: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Marketing and advertising expense $ 11,097 $ 15,705 $ 13,947 Shipping and Handling Costs Shipping and handling costs, which include freight and other expenses to prepare finished goods for shipment, are included in selling expenses. This excludes rent expense for our leased warehouse located in Huntley, IL. Shipping and handling costs for the last three fiscal years were as follows: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Shipping and handling costs $ 33,800 $ 32,460 $ 30,918 Research and Development Expenses Research and development expense represents the cost of our research and development personnel and their related expenses and is charged to selling expenses as incurred. Research and development expenses for the last three fiscal years were as follows: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Research and development expense $ 3,493 $ 3,621 $ 3,362 Stock-Based Compensation We account for stock-based employee compensation arrangements in accordance with the provisions of ASC Topic 718, Compensation — Stock Compensation , by calculating compensation cost based on the grant date fair value. We then amortize compensation expense over the vesting period. The grant date fair value of restricted stock units (“RSUs”) and performance stock units (“PSUs”) is generally determined based on the market price of our Common Stock on the date of grant. Forfeitures are recognized as they occur, and excess tax benefits or tax deficiencies are recognized as a component of income tax expense. Income Taxes We account for income taxes using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been reported in our financial statements or tax returns. Such items give rise to differences in the financial reporting and tax basis of assets and liabilities. A valuation allowance is recorded to reduce the carrying amount of deferred tax assets if it is more likely than not that all or a portion of the asset will not be realized. In estimating future tax consequences, we consider all expected future events other than changes in tax law or rates. We record liabilities for uncertain income tax positions based on a two-step process. The first step is recognition, where we evaluate whether an individual tax position has a likelihood of greater than 50% of being sustained upon examination based on the technical merits of the position, including resolution of any related appeals or litigation processes. For tax positions that are currently estimated to have a less than 50% likelihood of being sustained, no tax benefit is recorded. For tax positions that have met the recognition threshold in the first step, we perform the second step of measuring the benefit to be recorded. The actual benefits ultimately realized may differ from our estimates. In future periods, changes in facts, circumstances, and new information may require us to change the recognition and measurement estimates with regard to individual tax positions. Changes in recognition and measurement estimates are recorded in results of operations and financial position in the period in which such changes occur. We recognize interest and penalties accrued related to unrecognized tax benefits in the “Income tax expense” caption in the Consolidated Statement of Comprehensive Income. 46 We evaluate the realization of deferred tax assets by considering our historical taxable income and future taxable income based upon the reversal of deferred tax liabilities. As of June 26, 2025 , we believe that our deferred tax assets are fully realizable. Earnings per Share Basic earnings per common share are calculated using the weighted average number of shares of Common Stock and Class A Stock outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue Common Stock were exercised or converted into Common Stock or resulted in the issuance of Common Stock. The following table presents the reconciliation of the weighted average shares outstanding used in computing basic and diluted earnings per share: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Weighted average number of shares outstanding — basic 11,655,506 11,615,255 11,576,852 Effect of dilutive securities: Restricted stock units and performance stock units 68,927 72,291 65,194 Weighted average number of shares outstanding — diluted 11,724,433 11,687,546 11,642,046 There wer e no anti-dilutive awards excluded from the computation of diluted earnings per share for any periods presented. Comprehensive Income We account for comprehensive income in accordance with ASC Topic 220, Comprehensive Income . This topic establishes standards for reporting and displaying comprehensive income and its components in a full set of general-purpose financial statements. The topic requires that all components of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. This topic also requires all non-owner changes in stockholders’ equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. This guidance also requires presentation by the respective line items of net income, either on the face of the statement where net income is presented or in the notes and information about significant amounts required under U.S. GAAP to be reclassified out of accumulated other comprehensive income in their entirety. For amounts not required to be reclassified in their entirety to net income, we provide a cross-reference to other disclosures that offer additional details about those amounts. Recent Accounting Pronouncements The following accounting pronouncement has been adopted in the current fiscal year: In November 2023, the FASB issued ASU 2023-07 “ Segment Reporting (Topic 280) ”. The amendments in this update modify the disclosure requirements by expanding the disclosures required for reportable segments in annual and interim consolidated financial statements, primarily through enhanced disclosures about significant segment expenses. In addition, the amendments require that any entity that has a single reportable segment provide all the disclosures required both in this update and those already existing in Topic 280. The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. The Company adopted this pronouncement in fiscal 2025 and retrospectively to all prior periods using the significant segment expense categories identified. While the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements, it has resulted in incremental disclosure. See Note 17 — “Segment Reporting” for further discussion. The following recent accounting pronouncements have not yet been adopted: In December 2023, the FASB issued ASU 2023-09 “ Income Taxes (Topic 740): Improvements to Income Tax Disclosures ”. The amendments in this update enhance the transparency and decision usefulness of income tax disclosures primarily related to the rate reconciliation and income taxes paid by jurisdiction. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments will be applied prospectively, but may be applied retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of this update but do not expect it to have a material impact on our Consolidated Financial Statements. 47 NOTE 2 — LAKEVILLE ACQUISITION On September 29, 2023 , we completed the acquisition of certain snack bar assets from TreeHouse Foods, Inc. ( “Seller”). The acquired assets include inventory, a manufacturing facility and related equipment located in Lakeville, Minnesota, and product formulas (the “Lakeville Acquisition”) for a net purchase price of $ 58,974 . The purchase price for the Lakeville Acquisition was primarily funded from borrowings under the Credit Facility (defined in Note 7 - “Revolving Credit Facility” below). The Lakeville Acquisition accelerates our strategy within the growing bar category and diversifies our product offerings. It also allows us to offer private brand customers a complete portfolio of bars, including fruit and grain, crunchy, sweet and salty and chewy bars that complement internally developed nutrition bars. The Lakeville Acquisition has been accounted for as a business combination in accordance with ASC Topic 805, “Business Combinations”. The following table summarizes the amounts allocated to the fair values of certain assets acquired at the acquisition date: Inventories $ 35,500 Property, plant and equipment 25,600 Identifiable intangible assets: Product formulas 850 Total assets acquired $ 61,950 Property, plant and equipment represent a manufacturing facility and related equipment located in Lakeville, Minnesota. The fair value for the property was primarily determined using a market approach. The fair values for the machinery and equipment were determined using a combination of the direct and indirect cost approaches, along with the market approach. All building and equipment assets are being depreciated on a straight-line basis over their estimated remaining useful lives as determined in accordance with our accounting policies. The product formulas asset represents the value of these formulas designed to replicate the taste, texture and appearance of branded snack bars. The fair value of the product formulas was determined using the income approach through a relief from royalty method analysis. We are amortizing formulas over a weighted average life of 5.4 years. There were no recognized or unrecognized material contingencies associated with the acquired business. The $ 61,950 fair value of the identifiable assets acquired exceeded the total purchase price of $ 58,974 . Accordingly, this acquisition resulted in a bargain purchase and we recognized a gain o f $ 2,226 , net of taxes, which is reported in the caption “Bargain purchase gain, net” in our consolidated financial results for the year ended June 27, 2024. We believe the Lakeville Acquisition resulted in a bargain purchase gain because the Seller was motivated to divest such snack bars business, as its performance no longer supported the Seller's long-term growth targets. Net sales of $ 119,837 from the closing date of the Lakeville Acquisition on September 29, 2023 are included in our consolidated financial results for fiscal 2024. The closing date of the Lakeville Acquisition was on the first day of our second quarter in fiscal 2024. The Company also incurred acquisition-related costs of $ 856 for fiscal 2024 which are included in Administrative expenses . The following refle cts the unaudited pro forma results of operations of the Company as if the Lakeville Acquisition had taken place at the beginning of fiscal 2023. This pro forma information does not purport to represent what the Company’s actual results would have been if the Lakeville Acquisition had occurred as of the date indicated or what such results would be for any future periods. Year Ended June 27, 2024 Year Ended June 29, 2023 Pro forma net sales $ 1,107,096 $ 1,164,597 Pro forma net income 57,878 57,929 Pro forma diluted earnings per share $ 4.95 $ 4.98 These unaudited pro forma results have been calculated after applying our accounting policies and adjusting the results of the Lakeville Acquisition to reflect elimination of transaction costs and the bargain purchase gain and to record additional interest expense and cost of sales that would have been incurred, assuming the fair value adjustment to inventory had been applied from July 1, 2022, net of related income taxes in respect of pro forma net income and diluted earnings per share performance. The impact to the above pro forma information of incremental depreciation and amortization expense is insignificant and therefore excluded from the calculation of pro forma results. 48 Since the Lakeville Acquisition, we continue to operate in a single reportable operating segment that consists of selling various nut and nut-related products and bars through three sales distribution channels. Revenues from the Lakeville Acquisition are primarily in our consumer distribution channel. NOTE 3 — REVENUE RECOGNITION We recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. For each customer contract, a five-step process is followed in which we identify the contract, identify performance obligations, determine the transaction price, allocate the contract transaction price to the performance obligations, and recognize the revenue when (or as) the performance obligation is transferred to the customer. Nature of Products We manufacture and sell the following: • branded products under our own proprietary brands to retailers on a national basis; • private brand products to retailers, such as supermarkets, mass merchandisers, and specialty retailers, for resale under the retailers’ own or controlled labels; • private brand and branded products to the foodservice industry, including foodservice distributors and national restaurant operators; • branded products under co-manufacturing agreements to other major branded companies for their distribution; and • products to our industrial customer base for repackaging in portion control packages and for use as ingredients by other food manufacturers. When Performance Obligations Are Satisfied A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account for revenue recognition. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company’s performance obligations are primarily for the delivery of raw and processed recipe and snack nuts, nut butters, trail mixes and bars. Our customer contracts do not include more than one performance obligation. If a contract were to contain more than one performance obligation, we are required to allocate the contract’s transaction price to each performance obligation based on its relative standalone selling price. The standalone selling price for each distinct good is generally determined by directly observable data. Revenue recognition is generally completed at a point in time when product control is transferred to the customer. For virtually all of our revenues, control transfers to the customer when the product is shipped or delivered to the customer based upon applicable shipping terms, as the customer can then direct the use and obtain substantially all of the remaining benefits from the asset at that point in time. Therefore, the timing of our revenue recognition requires little judgment. The performance obligations in our contracts are satisfied within one year, and typically much less. As such, we have not disclosed the transaction price allocated to remaining performance obligations for any periods presented. Significant Payment Terms Our customer contracts identify the product, quantity, price, payment and final delivery terms. Payment terms usually include early pay discounts. We grant payment terms consistent with industry standards. On a limited basis some payment terms may be extended; however, no payment terms beyond six months are granted at contract inception. The average customer payment is received within approximately 30 days of the invoice date. As a result, we do not adjust the promised amount of consideration for the effects of a significant financing component because the period between our transfer of a promised good or service to a customer and the customer’s payment for that good or service will be six months or less. Shipping All shipping and handling costs associated with outbound freight are accounted for as fulfillment costs and are included in selling expense. 49 Variable Consideration Some of our products are sold through specific incentive programs consisting of promotional allowances, volume and customer rebates, in-store display incentives and marketing allowances, among others, to consumer and some commercial ingredient customers. The ultimate cost of these programs is dependent on certain factors such as actual purchase volumes or customer activities and is dependent on significant management judgment when determining estimates. The Company accounts for these programs as variable consideration and recognizes a reduction in revenue (and a corresponding reduction in the transaction price) in the same period as the underlying program based upon the terms of the specific arrangements. Trade promotions, consisting primarily of customer pricing allowances, merchandising funds and consumer coupons, are also offered through various programs to customers and consumers. A provision for estimated trade promotions is recorded as a reduction of revenue (and a reduction in the transaction price) in the same period when the sale is recognized. Revenues are also recorded net of expected customer deductions which are provided for based upon past experiences. Evaluating these estimates requires management judgment. We generally use the most likely amount method to determine the variable consideration. We believe there will not be significant changes to our estimates of variable consideration when any related uncertainties are resolved with our customers. The Company reviews and updates its estimates and related accruals of variable consideration and trade promotions at least quarterly based on the terms of the agreements and historical experience. Any uncertainties in the ultimate resolution of variable consideration due to factors outside of the Company’s influence are typically resolved within a short timeframe, therefore, no additional constraint on the variable consideration is required. Product Returns While customers generally have the right to return defective or non-conforming products, past experience has demonstrated that product returns have generally been immaterial. Customer remedies may include either a cash refund or an exchange of the returned product. As a result, the right of return and related refund liability for non-conforming or defective goods is estimated and recorded as a reduction in revenue, if necessary. Contract Balances Contract assets or liabilities result from transactions with revenue recorded over time. If the measure of remaining rights exceeds the measure of the remaining performance obligations, the Company records a contract asset. Conversely, if the measure of the remaining performance obligations exceeds the measure of the remaining rights, the Company records a contract liability. The contract asset balance at June 26, 2025 was $ 159 and is recorded in the caption “ Prepaid expenses and other current assets” on the Consolidated Balance Sheets. There was no other contract asset balance for the other periods presented. The Company generally does not have material deferred revenue or contract liability balances arising from transactions with customers. C ontract Costs The Company does not incur significant fulfillment costs requiring capitalization. Disaggregation of Revenue Revenue disaggregated by distribution channel is as follows: For the Year Ended Distribution Channel June 26, 2025 June 27, 2024 June 29, 2023 Consumer $ 907,222 $ 872,283 $ 785,646 Commercial Ingredients 108,941 110,483 123,094 Contract Manufacturing 91,083 84,017 90,946 Total $ 1,107,246 $ 1,066,783 $ 999,686 50 NOTE 4 — LEASES We lease warehouse space, equipment used in the transportation of goods in our warehouses and a limited number of automobiles and semi-trailers. Our leases generally do not contain any explicit guarantees of residual value and, with the exception of the Huntley facility, generally do not contain non-lease components. Our leases for warehouse transportation equipment generally require the equipment to be returned to the lessor in good working order. Through a review of our contracts, we determine if an arrangement is a lease at inception and analyze the lease to determine if it is operating or finance. Operating lease right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental collateralized borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Implicit rates are used when readily determinable. None of our leases currently contain options to extend the term. In the event of an option to extend the term of a lease, the lease term used in measuring the liability would include options to extend or terminate the lease if it is reasonably certain that the Company will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the respective lease term. Our leases have remaining terms of up to 6.6 years. It is our accounting policy not to apply lease recognition requirements to short-term leases, defined as leases with an initial term of 12 months or less. As such, leases with an initial term of 12 months or less are not recorded in the Consolidated Balance Sheets. We have also made the policy election to not separate lease and non-lease components for all leases. The following table provides supplemental information related to operating lease right-of-use assets and liabilities: June 26, 2025 June 27, 2024 Affected Line Item in Consolidated Balance Sheet Assets Operating lease right-of-use assets $ 27,824 $ 27,404 Operating lease right-of-use assets Total lease right-of-use assets $ 27,824 $ 27,404 Liabilities Current: Operating leases $ 4,515 $ 2,623 Other accrued expenses Noncurrent: Operating leases 24,224 24,877 Long-term operating lease liabilities Total lease liabilities $ 28,739 $ 27,500 The following tables summarize the Company’s total lease costs and other information arising from operating lease transactions: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Operating lease costs (a) $ 7,379 $ 3,147 $ 2,215 Variable lease costs (b) 1,282 ( 25 ) 208 Total Lease Cost $ 8,661 $ 3,122 $ 2,423 (a) Includes short-term leases which are immaterial for all periods presented. (b) Variable lease costs consist of property tax, sales tax, insurance and lease overtime charges. Supplemental cash flow and other information related to leases was as follows: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Operating cash flows information: Cash paid for amounts included in measurements for lease liabilities $ 5,609 $ 2,636 $ 1,804 Non-cash activity: Right-of-use assets obtained in exchange for new operating lease obligations $ 4,959 $ 23,000 $ 5,749 51 June 26, 2025 June 27, 2024 Weighted Average Remaining Lease Term (in years) 5.7 6.6 Weighted Average Discount Rate 6.7 % 6.8 % Maturities of operating lease liabilities as of June 26, 2025 are as follows: Fiscal Year Ending June 25, 2026 $ 6,285 June 24, 2027 6,295 June 29, 2028 6,149 June 28, 2029 5,230 June 27, 2030 4,379 Thereafter 6,368 Total lease payments 34,706 Less imputed interest ( 5,967 ) Present value of operating lease liabilities $ 28,739 At June 26, 2025, the Company has additional operating leases of approximate ly $ 496 t hat have not yet commenced and therefore are not reflected in the Consolidated Balance Sheet and tables above. The leases are scheduled to commence in the first quarter of fiscal 2026 with an initial lease term ranging from 4 to 6 years. Lessor Accounting We lease office space in our four-story office building located in Elgin, Illinois. As a lessor, we retain substantially all of the risks and benefits of ownership of the investment property and under Topic 842: Leases we continue to account for all of our leases as operating leases. Lease agreements may include options to renew. We accrue fixed lease income on a straight-line basis over the terms of the leases. There is generally no variable lease consideration and an immaterial amount of non-lease components such as recurring utility and storage fees. Leases between related parties are immaterial. Leasing revenue is as follows: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Lease income related to lease payments $ 1,479 $ 2,010 $ 1,651 The future minimum, undiscounted fixed cash flows under non-cancelable tenant operating leases for each of the next five years and thereafter is presented below. Fiscal Year Ending June 25, 2026 $ 1,155 June 24, 2027 1,172 June 29, 2028 582 June 28, 2029 531 June 27, 2030 544 Thereafter 2,443 $ 6,427 NOTE 5 — INVENTORIES Inventories consist of the following: June 26, 2025 June 27, 2024 Raw material and supplies $ 95,350 $ 85,300 Work-in-process and finished goods 159,250 111,263 $ 254,600 $ 196,563 52 NOTE 6 — GOODWILL AND INTANGIBLE ASSETS Intangible assets subject to amortization consist of the following: June 26, 2025 June 27, 2024 Customer relationships $ 21,350 $ 21,350 Brand names 17,070 17,070 Product formulas 850 850 Non-compete agreements 300 300 Total intangible assets, gross 39,570 39,570 Less accumulated amortization: Customer relationships ( 21,179 ) ( 20,680 ) Brand names ( 13,388 ) ( 12,668 ) Product formulas ( 283 ) ( 121 ) Non-compete agreements ( 292 ) ( 279 ) Total accumulated amortization ( 35,142 ) ( 33,748 ) Net intangible assets $ 4,428 $ 5,822 Customer relationships relate to the fiscal 2023 Just the Cheese brand acquisition, the fiscal 2018 Squirrel Brand acquisition and the fiscal 2010 Orchard Valley Harvest (“OVH”) acquisition. The customer relationships resulting from the OVH acquisition are fully amortized. The brand names consist primarily of the Squirrel Brand and Southern Style Nuts and the Fisher brand name, which we acquired in a 1995 acquisition. The Fisher brand name is fully amortized. The remainder of the brand name relates to Just the Cheese brand acquisition and the OVH acquisition, which is fully amortized. Product formulas relate to the private label bars acquired in fiscal 2024 Lakeville Acquisition. Total amortization expense related to intangible assets, which is classified in administrative expense in the Consolidated Statement of Comprehensive Income, was as follows for the last three fiscal years: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Amortization of intangible assets $ 1,394 $ 1,686 $ 1,767 Expected amortization expense the next five fiscal years is as follows: Fiscal Year Ending June 25, 2026 $ 1,042 June 24, 2027 847 June 29, 2028 677 June 28, 2029 496 June 27, 2030 400 Our net goodwill at June 29, 2023 was comprised of $ 9,650 from the fiscal 2018 Squirrel Brand acquisition and $ 2,100 from the fiscal 2023 Just the Cheese brand acquisition. The changes in the carrying amount of goodwill during the two fiscal years ended June 26, 2025 are as follows: Gross goodwill balance at June 29, 2023 $ 20,516 Accumulated impairment losses ( 8,766 ) Net balance at June 29, 2023 11,750 Goodwill acquired during fiscal 2024 — Net balance at June 27, 2024 11,750 Goodwill acquired during fiscal 2025 — Net balance at June 26, 2025 $ 11,750 53 NOTE 7 — REVOLVING CREDIT FACILITY On March 5, 2020, we entered into an Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”), which amended and restated our Credit Agreement dated as of February 7, 2008 (the “Former Credit Agreement”) with a bank group (the “Bank Lenders”). The Amended and Restated Credit Agreement provided for a $ 117,500 senior secured revolving credit facility (the “Credit Facility”) with the same borrowing capacity, interest rates and applicable margin as the Former Credit Agreement and extended the term of the Former Credit Agreement from July 7, 2021 to March 5, 2025. The Credit Facility is secured by substantially all of our assets other than machinery and equipment, real property and fixtures. On May 8, 2023, we entered into the First Amendment to our Amended and Restated Credit Agreement (the “First Amendment”), which replaced the London interbank offered rate interest rate option with the secured overnight financing rate (“SOFR”). The First Amendment updated the accrued interest rate to a rate based on SOFR plus an applicable margin based upon the borrowing base calculation, ranging from 1.35 % to 1.85 %. On September 29, 2023, we entered into the Second Amendment to our Amended and Restated Credit Agreement (the “Second Amendment”), which (among other things) increased the amount available to borrow under the Credit Facility to $ 150,000 , extended the maturity date to September 29, 2028 and allows the Company to pay up to $ 100,000 in dividends per year, subject to meeting availability tests. On June 16, 2025, we entered into the Consent and Third Amendment to our Amended and Restated Credit Agreement (the “Third Amendment”), which defined and included the Equipment Loan (as defined below in Note 8 — “Long-Term Debt” below). At June 26, 2025 the weighted average interest rate for the Credit Facility was 6.09 % . At June 27, 2024 the weighted average interest rate for the Credit Facility was 8.06 % . At June 26, 2025 and June 27, 2024, our unused letters of credit were $ 4,515 and $ 4,857 , respectively. The terms of the Credit Facility contain covenants that require us to restrict investments, indebtedness, liens, acquisitions and certain sales of assets, cash dividends, redemptions of capital stock and prepayment of indebtedness (if such prepayment, among other things, is of a subordinate debt). If loan availability under the Borrowing Base Calculation falls below $ 25,000 , we will be required to maintain a specified fixed charge coverage ratio, tested on a monthly basis. All cash received from customers is required to be applied against the Credit Facility. The Bank Lenders are entitled to require immediate repayment of our obligations under the Credit Facility in the event of default on the payments required under the Credit Facility, a change in control in the ownership of the Company, non-compliance with the financial covenant or upon the occurrence of certain other defaults by us under the Credit Facility. As of June 26, 2025, we were in compliance with the financial covenant under the Credit Facility and we currently expect to be in compliance with the financial covenant in the Credit Facility for the next twelve months. At June 26, 2025, we had $ 86,931 of available credit under the Credit Facility, which reflects borrowings of $ 57,584 and reduced availability as a result of $ 5,485 in outstanding letters of credit. We would still be in compliance with all restrictive covenants under the Credit Facility if this entire amount were borrowed. NOTE 8 — LONG-TERM DEBT Long-term debt consists of the following: June 26, 2025 June 27, 2024 Selma, Texas facility financing obligation to related parties, due in monthly installments of $ 114 including interest at 9.25 % through September 1, 2026 6,365 7,102 Equipment Loan financing obligation to Wells Fargo Bank, N.A due in monthly installments (a) 9,265 — Unamortized debt issuance costs ( 125 ) — 15,505 7,102 Less: Current maturities, net of unamortized debt issuance costs ( 941 ) ( 737 ) Total long-term debt, net of unamortized debt issuance costs $ 14,564 $ 6,365 (a) Equipment Loan funds will be disbursed by the lender in variable installments. The payback period will begin upon disbursement of the final loan proceeds expected to occur in the fourth quarter of our fiscal 2026. The fixed interest rate will be calculated at that point in time as well. 54 Selma Properties In September 2006, we sold our Selma, Texas properties (the “Selma Properties”) to two related party partnerships for $ 14,300 and are leasing them back. The selling price was determined by an independent appraiser to be the fair market value which also approximated our carrying value. The lease for the Selma, Texas properties had an initial ten-year term at a fair market value rent with three five-year renewal options . In September 2015, we signed a lease renewal which exercised two five-year renewal options and extended the term of our Selma lease to September 18, 2026 . At the end of each five-year renewal option, the base monthly lease amounts are reassessed, and the monthly payments increased to $ 114 beginning in September 2021. One five-year renewal option remains. Also, we currently have the option to purchase the properties from the lessor at 95 % ( 100 % in certain circumstances) of the then fair market value, but not to be less than the $ 14,300 purchase price. The financing obligation is being accounted for similar to the accounting for a capital lease, whereby the purchase price was recorded as a debt obligation, as the provisions of the arrangement are not eligible for sale-leaseback accounting. Equipment Loan On June 16, 2025, the Company entered into a financing agreement with Wells Fargo Bank, N.A. which allows the Company to finance up to $ 50,000 fo r the purchase of equipment to further expand our production capabilities, increase our efficiency and further enhance our product offerings to our customers (the “Equipment Loan”). The Equipment Loan is provided under a master loan agreement and related equipment schedule(s), and is secured under a Security Agreement which provides for a first priority lien on all equipment and a second priority lien on our accounts receivable and inventory. The Company will be required to make sixty equal monthly payments comprised of principal and interest starting upon distribution of the final loan proceeds which is expected to occur in the fourth quarter of fiscal 2026. The fixed interest rate (SOFR plus an applicable margin of 1.49 %) will be calculated at that point in time as well. Any change in the SOFR rate from what has been estimated in the table above will have an insignificant impact on the schedule. The Equipment Loan contains a graded prepayment penalty if the loan is paid off within 36 months of commencement. The Company will make monthly interest-only payments of SOFR plus an applicable margin of 1.60 % prior to the delivery and acceptance of the equipment and distribution of the final loan proceeds which will be capitalized as part of the equipment acquisition cost. Aggregate maturities of long-term debt are as follows: Fiscal Year Ending June 25, 2026 943 June 24, 2027 2,547 June 29, 2028 2,728 June 28, 2029 2,922 June 27, 2030 3,131 Thereafter 3,359 $ 15,630 NOTE 9 — INCOME TAXES The provision for income taxes is based entirely on income before income taxes earned in the United States, and is as follows for the last three fiscal years: For the Year Ended June 26, 2025 June 27, 2024 June 29, 2023 Current: Federal $ 16,736 $ 15,405 $ 18,393 State 4,687 4,987 5,215 Total current expense 21,423 20,392 23,608 Deferred: Deferred federal ( 2,009 ) 209 ( 1,164 ) Deferred state ( 483 ) ( 913 ) 49 Total deferred tax benefit ( 2,492 ) ( 704 ) ( 1,115 ) Total income tax expense $ 18,931 $ 19,688 $ 22,493 55 The reconciliations of income taxes at the statutory federal income tax rate to income tax expense reported in the Consolidated Statements of Comprehensive Income for the last three fiscal years are as follows: June 26, 2025 June 27, 2024 June 29, 2023 Federal statutory income tax rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal benefit 4.1 3.8 4.9 Section 162(m) limitation 0.2 1.4 0.7 Research and development tax credit ( 1.0 ) ( 0.9 ) ( 0.3 ) Bargain purchase gain — ( 0.6 ) — Share-based compensation ( 0.1 ) ( 0.4 ) 0.1 Uncertain tax positions 0.3 0.2 0.1 Other ( 0.2 ) 0.1 ( 0.1 ) Effective tax rate 24.3 % 24.6 % 26.4 % Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement basis and the tax basis of assets and liabilities using enacted statutory tax rates applicable to future years. Deferred tax assets and liabilities are comprised of the following: June 26, 2025 June 27, 2024 Deferred tax assets (liabilities): Accounts receivable $ 405 $ 417 Employee compensation 2,558 2,343 Inventory 621 460 Depreciation ( 15,902 ) ( 16,466 ) Capitalized leases 1,064 1,115 Goodwill and intangible assets 240 797 Retirement plan 7,185 6,716 Workers’ compensation 1,746 1,663 Share based compensation 2,085 1,780 Research related expenditures 5,035 3,505 Other 745 800 Net deferred tax asset $ 5,782 $ 3,130 In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the character necessary during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income and tax-planning strategies in making this assessment. If or when recognized, the tax benefits relating to any reversal of the valuation allowance will be recognized as a reduction of income tax expense. For the years ending June 26, 2025 and June 27, 2024, unrecognized tax benefits and accrued interest and penalties were $ 780 and $ 692 . Accrued interest and penalties related to uncertain tax positions are not material for any periods presented. Interest and penalties within income tax expense were not material for any period presented. The total gross amounts of unrecognized tax benefits were $ 807 and $ 733 at June 26, 2025 and June 27, 2024, respectively. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows: June 26, 2025 June 27, 2024 June 29, 2023 Beginning balance $ 733 $ 463 $ 390 Gross increases — tax positions in prior year 52 146 32 Settlements ( 141 ) ( 104 ) ( 36 ) Gross increases — tax positions in current year 251 311 127 Lapse of statute of limitations ( 88 ) ( 83 ) ( 50 ) Ending balance $ 807 $ 733 $ 463 56 Unrecognized tax benefits, that if recognized, would affect the annual effective tax rate on income from continuing operations, are as follows: June 26, 2025 June 27, 2024 June 29, 2023 Unrecognized tax benefits that would affect annual effective tax rate $ 770 $ 682 $ 439 During fiscal 2025, the change in unrecognized tax benefits due to statute expiration was not material. We do not anticipate that total unrecognized tax benefits will significantly change in the next twelve months. We file income tax returns with federal and state tax authorities within the United States of America. Our federal tax returns are open for audit for fiscal 2022 through 2024 . Our Illinois tax returns for fiscal 2023 and 2024 are under audit. Our California tax returns for fiscal 2021 through 2024 are open for audit. No other tax jurisdictions are material to us. The One, Big, Beautiful Bill Act (the “Act”) was signed into law on July 4, 2025. The Act contains significant tax law changes with various effective dates affecting business taxpayers. Among the tax law changes that will impact the Company relate to the timing of certain tax deductions including depreciation expense and research and development expenditures. The Company will implement the Act’s tax law changes in the first quarter of fiscal 2026. The Company does not anticipate any impact to its overall tax expense, but the Act will impact the allocation of tax expense between current and deferred. NOTE 10 — COMMITMENTS AND CONTINGENCIES Litigation We are currently a party to various legal proceedings in the ordinary course of business. While management presently believes that the ultimate outcomes of these proceedings, individually and in the aggregate, will not materially affect our financial position, results of operations or cash flows, legal proceedings are subject to inherent uncertainties, and unfavorable outcomes could occur. Unfavorable outcomes could include substantial money damages in excess of any appropriate accruals, which management has established. Were such unfavorable final outcomes to occur, there exists the possibility of a material adverse effect on our financial position, results of operations and cash flows. NOTE 11 — STOCKHOLDERS’ EQUITY Our Class A Common Stock, $ .01 par value (the “Class A Stock”), has cumulative voting rights with respect to the election of those directors which the holders of Class A Stock are entitled to elect, and 10 votes per share on all other matters on which holders of our Class A Stock and Common Stock are entitled to vote, with the exception of election of the directors for which the holders of Common Stock are eligible to elect. In addition, each share of Class A Stock is convertible at the option of the holder at any time into one share of Common Stock and automatically converts into one share of Common Stock upon any sale or transfer other than to related individuals or certain other events as set forth in our Restated Certificate of Incorporation. Each share of our Common Stock, $ .01 par value (the “Common Stock”) has noncumulative voting rights of one vote per share. The Class A Stock and the Common Stock are entitled to share equally, on a share-for-share basis, in any cash dividends declared by the Board of Directors, and the holders of the Common Stock are entitled to elect 25 %, rounded up to the nearest whole number, of the members comprising the Board of Directors. During fiscal 2017, our Board of Directors adopted a dividend policy under which it intends to pay an annual cash dividend on our Common Stock and Class A Stock during the first quarter of each fiscal year. NOTE 12 — STOCK-BASED COMPENSATION PLANS At our 2023 meeting of stockholders, our stockholders approved a new equity incentive plan (the “2023 Omnibus Plan”) under which awards of options and other stock-based awards may be made to employees, officers or non-employee directors of our Company. A total of 747,065 shares of Common Stock are authorized for grants of awards thereunder, which may be in the form of options, restricted stock, RSUs, stock appreciation rights (“SARs”), performance shares, PSUs, Common Stock or dividends and dividend equivalents. As of June 26, 2025, there were 627,364 shares of Common Stock that remained authorized for future grants of awards, subject to the limitations set below. Under the terms of the 2023 Omnibus Plan, the total number of shares of Common Stock with respect to which options or SARs may be granted in any calendar year to any participant may not exceed 500,000 shares (this limit applies separately with respect to each type of award). Additionally, for awards of restricted stock, RSUs, performance shares, PSUs or other stock-based awards that are intended to qualify as performance-based compensation: (i) the total number of shares of Common Stock that may be granted in any calendar year to any participant may not exceed 250,000 shares (this limit applies separately to each type of award) and (ii) the maximum amount that may be paid to any participant for awards that are payable in cash or property other than Common Stock in any calendar year is $ 5,000 . During fiscal 2017, the Board of Directors adopted an equity grant cap which further restricted the number of awards that could be made to any one participant or in the aggregate. The equity grant 57 cap limited the number of awards to 250,000 awards to all participants and 20,000 awards to any one participant in a fiscal year. Except as set forth in the 2023 Omnibus Plan, RSUs have vesting periods of three years for awards to employees and one year for awards to non-employee members of the Board of Directors. PSUs have a vesting period of approximately 33 months and performance goals that must be achieved in order to be earned and vest. We issue new shares of Common Stock upon the vesting of RSUs and PSUs. The fair value of RSUs and PSUs are generally determined based on the market price of our Common Stock on the date of grant. The fair value of RSUs and PSUs granted for the years ended June 26, 2025, June 27, 2024 and June 29, 2023 was $ 5,513 , $ 4,805 and $ 4,769 , respectively. The following is a summary of RSU activity for the year ended June 26, 2025: Restricted Stock Units Shares Weighted- Average Grant-Date Fair Value Outstanding at June 27, 2024 147,443 $ 73.09 Granted 63,414 $ 75.03 Vested (a) ( 43,094 ) $ 76.65 Forfeited ( 8,939 ) $ 75.35 Outstanding at June 26, 2025 158,824 $ 72.77 (a) The number of RSUs vested includes shares that were withheld on behalf of employees to satisfy statutory tax withholding requirements. The following is a summary of P SU activity for the year ended June 26, 2025: Performance Stock Units (a) Shares Weighted- Average Grant-Date Fair Value Outstanding at June 27, 2024 8,031 $ 82.99 Granted 10,481 $ 72.08 Vested — $ — Forfeited ( 1,213 ) $ 77.07 Outstanding at June 26, 2025 17,299 $ 76.79 (a) The PSUs are presented based on reaching target performance. The PSUs vest approximately 33 months from the grant date, with the number of shares earned (ranging from 0% to 200% of the target award) depending on the extent to which we achieve certain performance metrics. Based on current expectations and performance against these metrics, we expect 17,380 PSUs to be earned and thus vest at the end of the applicable vesting periods. The final number of shares that will eventually be earned and vest (if any) has not yet been determined as of June 26, 2025 . At June 26, 2025 there were 30,178 RSUs outstanding that were vested but deferred. At June 27, 2024 there were 25,800 RSUs outstanding that were vested but deferred. The non-vested RSUs and PSUs at June 26, 2025 will vest over a weighted-average period of 1.3 years. The fair value of RSUs that vested for the years ended June 26, 2025, June 27, 2024 and June 29, 2023 was $ 3,303 , $ 3,838 and $ 2,978 , respectively. The following table summarizes compensation cost charged to earnings for all equity compensation plans and the total income tax benefit recognized for the last three fiscal years: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 Compensation cost charged to earnings $ 4,523 $ 4,389 $ 3,565 Income tax benefit recognized 1,131 1,097 891 At June 26, 2025, there was $ 4,710 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under our stock-based compensation plans. We expect to recognize that cost over a weighted-average period of 1.3 years. 58 NOTE 13 — CASH DIVIDENDS Our Board of Directors declared and we paid the following cash dividends in fiscal 2025 and fiscal 2024: Declaration Date Record Date Dividend Per Share (a) Total Amount Payment Date July 17, 2024 August 20, 2024 $ 2.10 $ 24,404 September 11, 2024 May 1, 2024 May 31, 2024 $ 1.00 $ 11,621 June 20, 2024 July 18, 2023 August 22, 2023 $ 2.00 $ 23,175 September 13, 2023 (a) The dividends declared on July 18, 2023 and July 17, 2024 include both the annual and special dividend declared on such date. On July 15, 2025 , our Board of Directors declared a special cash dividend of $ 0.60 per share and a regular annual cash dividend of $ 0.90 per share on all issued and outstanding shares of Common Stock and Class A Stock of the Company. Refer to Note 19 — “Subsequent Event” below. NOTE 14 — EMPLOYEE BENEFIT PLANS We maintain a contributory plan established pursuant to the provisions of section 401(k) of the Internal Revenue Code. The plan provides retirement benefits for all nonunion employees meeting minimum age and service requirements. For the last three fiscal years, we matched 100 % of the first three percent contributed by each employee and 50 % of the next two percent contributed, up to certain maximums specified in the plan. Expense for the 401(k) plan was as follows for the last three fiscal years: Year Ended June 26, 2025 Year Ended June 27, 2024 Year Ended June 29, 2023 401(k) plan expense $ 4,085 $ 3,987 $ 2,746 We also offer a non-qualified deferred compensation plan to provide executives with the opportunity to accumulate assets for retirement on a tax-deferred basis (the “Plan”). Participants in the Plan can defer up to 80 % of their base salary and up to 100 % of performance-based compensation. The compensation deferred under this Plan is credited with earnings and losses as determined by the rate of return of reference investments selected by the participants. Participants are fully vested in their respective deferrals and earnings. We may also make discretionary contributions, which vest three years from the crediting date, at full vesting age, or other events as defined and described in the Plan. We invest in corporate owned life insurance contracts (“COLI”) on the lives of designated individuals that are held in a Rabbi Trust (“Trust”) to fund the Plan obligations. The Trust is the owner and beneficiary of such insurance contracts. Our promise to pay amounts deferred under this Plan is an unsecured obligation. Participant’s benefits can be paid out as a lump sum or in annual installments over a term of up to 10 years . The COLI investments are recorded at cash surrender value. The cash surrender value of the life insurance contracts was $ 2,599 and $ 1,214 at June 26, 2025 and June 27, 2024, respectively, and are included in Other long term assets in the accompanying Consolidated Balance Sheets. The balances due to participants in the Plan were $ 2,769 and $ 1,261 as of June 26, 2025 and June 27, 2024, respectively, and are included in the caption “Other” within Long term liabilities in the accompanying Consolidated Balance Sheets. Matching contribution expense was $ 53 and $ 246 for the year ended June 26, 2025 and June 27, 2024, respectively. Virtually all of our salaried employees participate in our Sanfilippo Value Added Plan (as amended, the “SVA Plan”), which is a cash incentive plan (an economic value added-based program) administered by our Compensation and Human Resources Committee. We accrue expense related to the SVA Plan in the annual period that the economic performance underlying such performance occurs. This method of expense recognition properly matches the expense associated with improved economic performance with the period the improved performance occurs on a systematic and rational basis. The SVA Plan payments, if any, are paid to participants in the first quarter of the following fiscal year in which they are earned. NOTE 15 — RETIREMENT PLAN The Supplemental Employee Retirement Plan (“SERP”) is an unfunded, non-qualified benefit plan that will provide eligible participants with monthly benefits upon retirement, disability or death, subject to certain conditions. Benefits paid to retirees are based on age at retirement, years of credited service, and average compensation. We use our fiscal year end as the measurement date for the obligation calculation. Accounting guidance in ASC Topic 715, Compensation — Retirement Benefits , requires the recognition of the funded status of the SERP on the Consolidated Balance Sheet. Actuarial gains or losses, prior service costs or credits and transition obligations that have not yet been recognized are recorded as a component of “Accumulated Other Comprehensive Income (Loss)”. 59 The following table presents the changes in the projected benefit obligation for the fiscal years ended: June 26, 2025 June 27, 2024 Change in projected benefit obligation Projected benefit obligation at beginning of year $ 26,862 $ 28,017 Service cost 516 251 Interest cost 1,445 1,400 Actuarial loss (gain) 640 ( 1,663 ) Benefits paid ( 724 ) ( 1,143 ) Projected benefit obligation at end of year $ 28,739 $ 26,862 The accumulated benefit obligation, which represents benefits earned up to the measurement date, was $ 27,583 and $ 24,952 at June 26, 2025 and June 27, 2024, respectively. Components of the actuarial loss (gain) are presented below for the fiscal years ended: June 26, 2025 June 27, 2024 June 29, 2023 Actuarial Loss (Gain) Change in assumed pay increases $ 1,119 $ 1,418 $ ( 70 ) Change in discount rate ( 141 ) ( 1,138 ) ( 1,584 ) Change in mortality assumptions — — — Other ( 338 ) ( 1,943 ) ( 1,353 ) Actuarial loss (gain) $ 640 $ ( 1,663 ) $ ( 3,007 ) The components of the net periodic pension cost are as follows for the fiscal years ended: June 26, 2025 June 27, 2024 June 29, 2023 Service cost $ 516 $ 251 $ 801 Interest cost 1,445 1,400 1,366 Recognized loss amortization — — 28 Net periodic pension cost $ 1,961 $ 1,651 $ 2,195 The most significant assumption related to our SERP is the discount rate used to calculate the actuarial present value of benefit obligations to be paid in the future. We used the following assumptions to calculate the benefit obligation of our SERP as of the following dates: June 26, 2025 June 27, 2024 Discount rate 5.49 % 5.45 % Average rate of compensation increases 4.50 % 6.11 % Bonus payment 45% - 115% of base, paid 4 of 5 years 45% - 115% of base, paid 4 of 5 years We used the following assumptions to calculate the net periodic costs of our SERP as follows for the fiscal years ended: June 26, 2025 June 27, 2024 June 29, 2023 Discount rate 5.45 % 5.12 % 4.68 % Rate of compensation increases 6.11 % 4.50 % 4.50 % Mortality Pri-2012 white collar with MP- 2021 scale Pri-2012 white collar with MP- 2021 scale Pri-2012 white collar with MP- 2021 scale Bonus payment 45% - 115% of base, paid 4 of 5 years 45% - 110% of base, paid 4 of 5 years 45% - 110% of base, paid 4 of 5 years 60 The assumed discount rate is based, in part, upon a discount rate modeling process that considers both high quality long-term indices and the duration of the SERP relative to the durations implicit in the broader indices. The discount rate is utilized principally in calculating the actuarial present value of our obligation and periodic expense pursuant to the SERP. To the extent the discount rate increases or decreases, our SERP obligation is decreased or increased, respectively. The following table presents the benefits expected to be paid in the next ten fiscal years: Fiscal Year 2026 $ 818 2027 890 2028 854 2029 1,855 2030 1,820 2031 — 2035 11,024 At June 26, 2025 and June 27, 2024, the current portion of the SERP liability was $ 818 and $ 708 , respectively, and recorded in the caption “Accrued payroll and related benefits” on the Consolidated Balance Sheets. The following table presents the components of accumulated other comprehensive income that have not yet been recognized in net pension expense: June 26, 2025 June 27, 2024 Unrecognized net gain $ 983 $ 1,623 Tax effect ( 419 ) ( 579 ) Net amount unrecognized $ 564 $ 1,044 NOTE 16 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The table below sets forth the changes to accumulated other comprehensive income (loss) for the last two fiscal years. These changes are all related to our defined benefit pension plan. Changes to Accumulated Other Comprehensive Income (Loss) (a) Year Ended June 26, 2025 Year Ended June 27, 2024 Balance at beginning of period $ 1,044 $ ( 204 ) Other comprehensive income before reclassifications ( 640 ) 1,663 Amounts reclassified from accumulated other comprehensive loss — — Tax effect 160 ( 415 ) Net current-period other comprehensive income ( 480 ) 1,248 Balance at end of period $ 564 $ 1,044 (a) Amounts in parenthesis indicate debits/expense. NOTE 17 — SEGMENT REPORTING The Company’s chief operating decision maker (“CODM”) is comprised of the chief executive officer and chief operating officer who review financial information on a consolidated basis for purposes of making operating decisions, allocating resources and evaluating financial performance. As such, we operate in a single reporting unit and operating segment that consists of selling various nut and nut related products and bars through three distribution channels, almost entirely within the United States. A description of how the Company derives revenues is included in Note 3 — “Revenue Recognition”. The CODM uses consolidated net income as the measure of segment profit or loss to make key operating decisions, monitor budget versus actual results and allocate resources. The CODM compares net income to prior year to assess year-over-year growth of the Company and compares net income to budget to evaluate how the Company is performing against internal expectations. The measure of segment assets is reported on the Consolidated Balance Sheet as total assets. Depreciation, amortization and purchases of property, plant and equipment are reported at the consolidated level on the Consolidated Statements of Cash Flows. The significant segment expenses regularly provided to the CODM are those presented on our Consolidated Statements of Comprehensive Income. These significant expenses include cost of sales, selling expenses and administrative expenses. Other segment items include interest expense, 61 net rental and miscellaneous expense, pension expense and income tax expense on the Consolidated Statements of Comprehensive Income. Depreciation expense, significant customers and geographic information, and revenue by product type are included in Note 1 — “Significant Accounting Policies”, Note 3 — “Revenue Recognition” and Note 18 — “Product Type Sales Mix”, respectively. NOTE 18 — PRODUCT TYPE SALES MIX The following table summarizes sales by product type as a percentage of total gross sales. The information is based upon gross sales, rather than net sales, because certain adjustments, such as promotional discounts, are not allocable to product types, for the fiscal year ended: Product Type June 26, 2025 June 27, 2024 June 29, 2023 Peanuts & Peanut Butter 16.4 % 17.9 % 19.0 % Pecans 9.4 9.1 11.4 Cashews & Mixed Nuts 17.6 18.2 20.7 Walnuts 4.9 4.4 5.6 Almonds 7.2 7.8 8.8 Trail & Snack Mixes 24.2 24.8 27.2 Bars 14.0 11.4 0.4 Other 6.3 6.4 6.9 100.0 % 100.0 % 100.0 % NOTE 19 — SUBSEQUENT EVENT On July 15, 2025 , our Board of Directors declared a special cash dividend of $ 0.60 per share and a regular annual cash dividend of $ 0.90 per share on all issued and outstanding shares of Common Stock and Class A Stock of the Company (the “August 2025 Dividends”). The August 2025 Dividends will be paid on September 11, 2025 to stockholders of record as of the close of business on August 19, 2025 . 62 Item 9 — Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.