What changed in this filing

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Item 1. Financial Statements

2025-05-07 compared with 2025-02-06 · 112 added, 97 removed, 591 unchanged (26% of the section changed)

54 unchanged sentences

(Amounts in Thousands, Except for Per Share Data)

Three Months Ended Six Months Ended

December 31 December 31

Three Months Ended Nine Months Ended

March 31 March 31

(Unaudited) 2025 2024 2025 2024

3 unchanged sentences

Selling and Administrative Expenses 13,154 16,861 37,107 50,736

Other General Income — ( 892 ) — ( 892 )

Restructuring Expense 2,026 1,622 9,019 1,622

Gain on Disposal — — ( 1,264 ) —

Operating Income 8,230 16,610 17,345 36,100

Goodwill Impairment — 5,820 — 5,820

Asset Impairment (Gain on Disposal)

— 16,564 ( 1,264 ) 16,564

Operating Income (Loss) 11,716 ( 6,431 ) 29,061 29,669

Other Income (Expense):

3 unchanged sentences

Other income (expense), net ( 4,562 ) ( 6,322 ) ( 15,549 ) ( 17,935 )

Income Before Taxes on Income 3,474 11,276 6,358 24,487

Income (Loss) Before Taxes on Income 7,154 ( 12,753 ) 13,512 11,734

Provision (Benefit) for Income Taxes

3,337 ( 6,677 ) 3,109 ( 1,234 )

Net Income $ 3,432 $ 8,290 $ 6,586 $ 19,044

Earnings Per Share of Common Stock:

Net Income (Loss) $ 3,817 $ ( 6,076 ) $ 10,403 $ 12,968

Earnings (Loss) Per Share of Common Stock:

Basic $ 0.15 $ ( 0.24 ) $ 0.42 $ 0.52

8 unchanged sentences

Three Months Ended Three Months Ended

December 31, 2024 December 31, 2023

March 31, 2025 March 31, 2024

(Unaudited) Pre-tax Tax Net of Tax Pre-tax Tax Net of Tax

9 unchanged sentences

Total comprehensive income $ 11,904 $ ( 9,499 )

Six Months Ended Six Months Ended

December 31, 2024 December 31, 2023

Nine Months Ended Nine Months Ended

March 31, 2025 March 31, 2024

(Unaudited) Pre-tax Tax Net of Tax Pre-tax Tax Net of Tax

13 unchanged sentences

(Amounts in Thousands)

Six Months Ended

Nine Months Ended

(Unaudited) 2025 2024

1 unchanged sentence

Net income $ 10,403 $ 12,968

Adjustments to reconcile net income to net cash provided by (used for) operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 27,412 28,522

1 unchanged sentence

Deferred income taxes ( 4,565 ) ( 14,149 )

Gain on disposal ( 1,264 ) —

Goodwill impairment — 5,820

Asset Impairment (Gain on Disposal) ( 1,264 ) 16,264

Stock-based compensation 4,528 5,435

8 unchanged sentences

Accrued expenses and taxes payable ( 19,715 ) ( 11,526 )

Net cash provided by (used for) operating activities 74,932 ( 17,922 )

Net cash provided by operating activities 105,870 24,717

Cash Flows From Investing Activities:

14 unchanged sentences

Effect of Exchange Rate Change on Cash and Cash Equivalents 13 ( 113 )

Net Decrease in Cash, Cash Equivalents, and Restricted Cash ( 24,259 ) ( 3,060 )

Net (Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash ( 25,892 ) 23,473

Cash, Cash Equivalents, and Restricted Cash at Beginning of Period (1)

10 unchanged sentences

The restricted cash included in Prepaid expenses and other current assets on the balance sheet represents funds held by the Company for a foreign subsidiary’s employee savings plan.

(Unaudited) December 31,

(Unaudited) March 31,

2025 June 30,

9 unchanged sentences

(Unaudited) Additional Paid-In Capital

Amounts at September 30, 2024 $ 319,175 $ 319,718 $ ( 11,769 ) $ ( 79,366 ) $ 547,758

Amounts at December 31, 2024 $ 319,744 $ 323,150 $ ( 23,383 ) $ ( 82,035 ) $ 537,476

Other comprehensive income (loss) 8,087 8,087

Issuance of non-restricted stock ( 26,000 shares)

Compensation expense related to stock compensation plans 1,830 1,830

Charitable donation of common stock ( 2,000 shares)

Performance and restricted share issuance ( 0 and 4,000 shares, respectively)

( 117 ) 49 ( 68 )

Repurchase of common stock ( 175,000 shares) (including excise tax)

( 3,027 ) ( 3,027 )

Amounts at March 31, 2025 $ 321,457 $ 326,967 $ ( 15,296 ) $ ( 85,013 ) $ 548,115

Amounts at December 31, 2023 $ 316,309 $ 315,097 $ ( 9,641 ) $ ( 74,776 ) $ 546,989

Amounts at September 30, 2023 $ 314,255 $ 306,807 $ ( 17,781 ) $ ( 75,019 ) $ 528,262

Net income ( 6,076 ) ( 6,076 )

Other comprehensive income (loss) ( 3,423 ) ( 3,423 )

Issuance of non-restricted stock ( 18,000 shares)

Compensation expense related to stock compensation plans 1,658 1,658

1 unchanged sentence

( 139 ) 52 ( 87 )

Amounts at December 31, 2023 $ 316,309 $ 315,097 $ ( 9,641 ) $ ( 74,776 ) $ 546,989

Six Months Ended

Amounts at March 31, 2024 $ 317,828 $ 309,021 $ ( 13,064 ) $ ( 74,724 ) $ 539,061

Nine Months Ended

Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Share Owners’ Equity

10 unchanged sentences

( 8,928 ) ( 8,928 )

Amounts at December 31, 2024 $ 319,744 $ 323,150 $ ( 23,383 ) $ ( 82,035 ) $ 537,476

Amounts at March 31, 2025 $ 321,457 $ 326,967 $ ( 15,296 ) $ ( 85,013 ) $ 548,115

Amounts at June 30, 2023 $ 315,482 $ 296,053 $ ( 11,046 ) $ ( 76,495 ) $ 523,994

5 unchanged sentences

( 3,027 ) 1,549 ( 1,478 )

Amounts at December 31, 2023 $ 316,309 $ 315,097 $ ( 9,641 ) $ ( 74,776 ) $ 546,989

Amounts at March 31, 2024 $ 317,828 $ 309,021 $ ( 13,064 ) $ ( 74,724 ) $ 539,061

See Notes to Condensed Consolidated Financial Statements .

6 unchanged sentences

We provide electronics manufacturing services (“EMS”), including engineering and supply chain support, to customers in the automotive, medical, and industrial end markets.

We deliver a package of value that begins with our core competency of producing durable electronics, and we further offer contract manufacturing services for non-electronic components, medical disposables, and precision molded plastics.

We deliver a package of value that begins with our core competency of producing durable electronics.

We further offer contract manufacturing organization (“CMO”) solutions which include operations such as precision molded plastics, complete device assembly, and cold chain management, which support the production of medical disposables and selected drug delivery devices such as auto-injectors.

Our design and manufacturing expertise coupled with robust processes and procedures help us ensure that we deliver the highest levels of quality, reliability, and service throughout the entire life cycle of our customers’ products.

2 unchanged sentences

Basis of Presentation:

The Condensed Consolidated Financial Statements presented herein reflect the consolidated financial position as of December 31, 2024 and June 30, 2024, results of operations for the three and six months ended December 31, 2024 and 2023, cash flows for the six months ended December 31, 2024 and 2023, and share owners’ equity for the three and six months ended December 31, 2024 and 2023.

The Condensed Consolidated Financial Statements presented herein reflect the consolidated financial position as of March 31, 2025 and June 30, 2024, results of operations for the three and nine months ended March 31, 2025 and 2024, cash flows for the nine months ended March 31, 2025 and 2024, and share owners’ equity for the three and nine months ended March 31, 2025 and 2024.

The financial data presented herein is unaudited and should be read in conjunction with the annual Consolidated Financial Statements as of and for the year ended June 30, 2024 and related notes thereto included in our Annual Report on Form 10-K.

38 unchanged sentences

Receivables are considered sold when they are transferred beyond the reach of Kimball Electronics and its creditors, the purchaser has the right to pledge or exchange the receivables, and we have surrendered control over the transferred receivables.

In the six months ended December 31, 2024 and 2023, we sold, without recourse, $ 169.0 million and $ 198.9 million of accounts receivable, respectively.

For the three months ended December 31, 2024 and 2023, factoring fees were $ 0.5 million and $ 0.8 million, and $ 1.1 million and $ 1.7 million during the six months ended December 31, 2024 and 2023, respectively.

Factoring fees are recorded in Non-operating income (expense), net on our Condensed Consolidated Statements of Income for the three and six months ended December 31, 2024.

In the nine months ended March 31, 2025 and 2024, we sold, without recourse, $ 236.2 million and $ 317.0 million of accounts receivable, respectively.

For the three months ended March 31, 2025 and 2024, factoring fees were $ 0.5 million and $ 0.9 million, and $ 1.5 million and $ 2.6 million during the nine months ended March 31, 2025 and 2024, respectively.

Factoring fees are recorded in Non-operating income (expense), net on our Condensed Consolidated Statements of Income for the three and nine months ended March 31, 2025.

Prior to fiscal year 2025, factoring fees were recorded in Selling and Administrative Expenses.

2 unchanged sentences

The amount expected to be collected after twelve months is included in Other Assets, net on the Condensed Consolidated Balance Sheet.

At December 31, 2024, the noncurrent receivable associated with this customer in Other Assets, net of allowance for expected credit losses, totaled $ 2.7 million.

The current portion of receivables from this customer is $ 2.6 million at December 31, 2024.

At March 31, 2025, the noncurrent receivable associated with this customer in Other Assets, net of allowance for expected credit losses, totaled $ 2.9 million.

The current portion of receivables from this customer is $ 1.8 million at March 31, 2025.

The Company’s China operations, in limited circumstances, may receive banker’s acceptance drafts from customers as payment on account.

The banker’s acceptance drafts are non-interest bearing and primarily mature within six months from the origination date.

The Company has the ability to sell the drafts at a discount or transfer the drafts in settlement of current accounts payable prior to the scheduled maturity date.

These drafts, which totaled $ 7.1 million at March 31, 2025, are reflected in Receivables on the Condensed Consolidated Balance Sheets until the banker’s drafts are sold at a discount, transferred in settlement of current accounts payable, or cash is received at maturity.

Banker’s acceptance drafts sold at a discount or transferred in settlement of current accounts payable during the nine months ended March 31, 2025 were $ 0.1 million.

No banker’s drafts were held during the prior fiscal year.

Non-operating Income (Expense), net:

3 unchanged sentences

Components of Non-operating income (expense), net:

Three Months Ended Six Months Ended

December 31 December 31

Three Months Ended Nine Months Ended

March 31 March 31

(Amounts in Thousands) 2025 2024 2025 2024

22 unchanged sentences

Tax Reform, in addition to other changes, required a one-time transition tax on certain unremitted earnings of foreign subsidiaries that is payable over an eight-year period.

As of December 31, 2024 and June 30, 2024, the remaining provision recorded for the one-time deemed repatriation tax was $ 3.3 million and $ 5.9 million, respectively, payable through fiscal year 2026.

As of December 31, 2024, the remaining deemed repatriation tax is short term and is recorded in Accrued expenses on the Condensed Consolidated Balance Sheets.

With the expected capital gains generated from the sale of the Tampa property, a portion of our deferred tax asset allowances from past capital losses are now expected to be realized, and in the second quarter of fiscal year 2025, we reversed $ 2.4 million of these allowances, reducing our income tax expense.

As of March 31, 2025 and June 30, 2024, the remaining provision recorded for the one-time deemed repatriation tax was $ 3.3 million and $ 5.9 million, respectively, payable through fiscal year 2026.

As of March 31, 2025, the remaining deemed repatriation tax is short term and is recorded in Accrued expenses on the Condensed Consolidated Balance Sheets.

With the expected capital gains generated from the sale of the Tampa property, a portion of our deferred tax asset allowances from past capital losses are now expected to be realized, and in fiscal year 2025, we reversed $ 2.9 million of these allowances, reducing our income tax expense.

New Accounting Standards:

7 unchanged sentences

Early adoption is permitted.

We are currently evaluating the impact of the adoption of this guidance on our consolidated financial statements.

The Company plans to adopt the standard for the year ended June 30, 2025 and will include any additional disclosures in its Annual Report on Form 10-K for the fiscal year.

In December 2023, the FASB issued guidance on Improvements to Income Tax Disclosures, intended to enhance the transparency and decision usefulness of income tax disclosures.

4 unchanged sentences

Our revenue from contracts with customers is generated primarily from manufacturing services provided for the production of electronic assemblies, electronic and non-electronic components, medical devices, medical disposables, and precision molded plastics in automotive, medical, and industrial applications, to the specifications and designs of our customers.

The following table disaggregates our revenue by end market vertical for the three and six months ended December 31, 2024 and 2023.

Three Months Ended Six Months Ended

December 31 December 31

The following table disaggregates our revenue by end market vertical for the three and nine months ended March 31, 2025 and 2024.

Three Months Ended Nine Months Ended

March 31 March 31

(Amounts in Millions) 2025 2024 2025 2024

4 unchanged sentences

Total net sales $ 374.6 $ 425.0 $ 1,106.3 $ 1,284.4

For the three months ended December 31, 2024 and 2023, approximately 99 % and 95 % of our net sales were recognized over time as manufacturing services were performed under a customer contract on a product with no alternative use and we have an enforceable right to payment for performance completed to date.

For the six months ended December 31, 2024 and 2023, approximately 98 % and 96 % of our net sales were recognized over time.

For the three months ended March 31, 2025 and 2024, approximately 98 % and 97 % of our net sales were recognized over time as manufacturing services were performed under a customer contract on a product with no alternative use and we have an enforceable right to payment for performance completed to date.

For the nine months ended March 31, 2025 and 2024, approximately 98 % and 96 % of our net sales were recognized over time.

The remaining sales revenues were recognized at a point in time when the customer obtained control of the products.

1 unchanged sentence

Contract assets on the Condensed Consolidated Balance Sheets relate to unbilled accounts receivable and occur when revenue is recognized over time as manufacturing services are provided and the billing to the customer has not yet occurred as of the balance sheet date, which are generally transferred to receivables in the next fiscal quarter due to the short-term nature of the manufacturing cycle.

Contract assets were $ 82.0 million and $ 76.3 million as of December 31, 2024 and June 30, 2024, respectively.

Contract assets were $ 78.4 million and $ 76.3 million as of March 31, 2025 and June 30, 2024, respectively.

The Company may receive payments from customers in advance of the satisfaction of performance obligations primarily for material price variances, inventory purchases, tooling, or other miscellaneous services or costs.

These payments are recognized as contract liabilities until the performance obligations are completed and are included in Advances from customers, if inventory related, and Accrued expenses, if not inventory related, on the Condensed Consolidated Balance Sheets , which amounted to $ 50.8 million and $ 43.1 million as of December 31, 2024 and June 30, 2024, respectively.

These payments are recognized as contract liabilities until the performance obligations are completed and are included in Advances from customers, if inventory related, and Accrued expenses, if not inventory related, on the Condensed Consolidated Balance Sheets , which amounted to $ 49.7 million and $ 43.1 million as of March 31, 2025 and June 30, 2024, respectively.

Our performance obligations are short term in nature and therefore our contract liabilities are all expected to be settled within twelve months.

5 unchanged sentences

The following table summarizes net sales and income (loss) before taxes on income for the disposal group:

Three Months Ended Six Months Ended

December 31 December 31

Three Months Ended Nine Months Ended

March 31 March 31

(Amounts in Thousands) 2025 2024 2025 2024

2 unchanged sentences

$ — $ ( 25,691 ) $ 985 $ ( 25,141 )

(1) Includes gain on sale of $ 1.3 million for the six months ended December 31, 2024.

(1) Includes gain on sale of $ 1.3 million for the nine months ended March 31, 2025 and $ 22.4 million in goodwill and asset impairment charges in the three and nine month periods ended March 31, 2024.

Each period also includes allocated corporate overhead expenses.

Restructuring Activities

In the three and six months ended December 31, 2024, we continued our restructuring efforts to align our cost structure with reduced end market demand levels, including resizing our workforce and taking specific cost actions, and recorded restructuring expense of $ 1.7 million and $ 4.0 million, respectively, which were primarily employee-related costs.

The cumulative amount incurred since inception of these efforts beginning in fiscal year 2024 through December 31, 2024 was $ 6.4 million.

In the three and nine months ended March 31, 2025, we continued our restructuring efforts to align our cost structure with reduced end market demand levels, including resizing our workforce and taking specific cost actions, and recorded restructuring expense of $ 1.3 million and $ 5.3 million, respectively, which were primarily employee-related costs.

The cumulative amount incurred since inception of these efforts beginning in fiscal year 2024 through March 31, 2025 was $ 6.9 million.

We expect to continue executing these previously announced restructuring efforts over the remainder of the fiscal year and estimate between $ 0.2 million and $ 0.5 million of additional pre-tax restructuring charges.

3 unchanged sentences

We expect these costs to be predominantly cash expenditures, and a majority are anticipated to be incurred over the remainder of fiscal year 2025.

For the three and six months ended December 31, 2024, we recorded restructuring expense of $ 3.0 million for the Tampa Closure Plan.

For the three and nine months ended March 31, 2025, we recorded restructuring expense of $ 0.7 million and $ 3.7 million for the Tampa Closure Plan.

Accrued restructuring is recorded in Accrued expenses in the Condensed Consolidated Balance Sheet.

5 unchanged sentences

Non-cash activity — — —

Balance at December 31, 2024

Balance at March 31, 2025

$ 2,929 $ — $ 2,929

2 unchanged sentences

Inventory components were as follows:

(Amounts in Thousands) December 31, 2024 June 30, 2024

(Amounts in Thousands) March 31, 2025 June 30, 2024

Finished products $ 481 $ 141

2 unchanged sentences

Total inventory $ 296,602 $ 338,116

Additionally, as of December 31 and June 30, 2024, we have raw materials inventory totaling $ 44.3 million and $ 42.8 million, respectively, classified as long-term included in Other Assets, net in our Condensed Consolidated Balance Sheets.

Additionally, as of March 31 and June 30, 2024, we have raw materials inventory totaling $ 45.1 million and $ 42.8 million, respectively, classified as long-term included in Other Assets, net in our Condensed Consolidated Balance Sheets.

A majority of this inventory is associated with a customer who is remediating a recall and we do not expect the inventory to be consumed

within the next twelve months.

As of December 31 and June 30, 2024, we have received deposits from this customer for this long-term inventory totaling $ 30.7 million and $ 38.7 million, respectively, which is included in Other long-term liabilities in our Condensed Consolidated Balance Sheets.

As of March 31, 2025 and June 30, 2024, we have received deposits for this long-term inventory totaling $ 31.5 million and $ 38.7 million, respectively, which is included in Other long-term liabilities in our Condensed Consolidated Balance Sheets.

The remaining inventory classified as long term is primarily related to other excess raw materials inventory we do not expect to consume or sell within twelve months.

1 unchanged sentence

Accumulated Other Comprehensive Income (Loss)

During the six months ended December 31, 2024 and 2023, the changes in the balances of each component of Accumulated Other Comprehensive Income (Loss), net of tax, were as follows:

During the nine months ended March 31, 2025 and 2024, the changes in the balances of each component of Accumulated Other Comprehensive Income (Loss), net of tax, were as follows:

Accumulated Other Comprehensive Income (Loss)

6 unchanged sentences

Net current-period other comprehensive income (loss) 1,721 365 425 2,511

Balance at December 31, 2024

Balance at March 31, 2025

$ ( 12,539 ) $ ( 2,030 ) $ ( 727 ) $ ( 15,296 )

4 unchanged sentences

Net current-period other comprehensive income (loss) ( 1,617 ) 30 ( 431 ) ( 2,018 )

Balance at December 31, 2023

Balance at March 31, 2024

$ ( 13,449 ) $ 1,398 $ ( 1,013 ) $ ( 13,064 )

The following reclassifications were made from Accumulated Other Comprehensive Income (Loss) to the Condensed Consolidated Statements of Income:

Reclassifications from Accumulated Other Comprehensive Income (Loss) Three Months Ended Six Months Ended Affected Line Item in the Condensed Consolidated Statements of Income

December 31 December 31

Reclassifications from Accumulated Other Comprehensive Income (Loss) Three Months Ended Nine Months Ended Affected Line Item in the Condensed Consolidated Statements of Income

March 31 March 31

(Amounts in Thousands) 2025 2024 2025 2024

17 unchanged sentences

Management refines the warranty liability regularly based on changes in historical cost trends and in certain cases where specific warranty issues become known.

This product warranty liability and expense were immaterial during the six months ended December 31, 2024 and 2023.

This product warranty liability and expense were immaterial as of and during the nine months ended March 31, 2025 and 2024, respectively.

Credit Facilities

2 unchanged sentences

(Amounts in Millions, in U.S.

Dollar Equivalents) December 31, 2024 December 31, 2024 June 30, 2024

Dollar Equivalents) March 31, 2025 March 31, 2025 June 30, 2024

Primary credit facility, revolving (1)

21 unchanged sentences

Types of borrowings available on the restated primary credit facility include term loans, revolving loans, multi-currency term loans, and swingline loans.

At December 31, 2024, all outstanding borrowings under the primary credit facility were Term Benchmark borrowings denominated in U.S.

At March 31, 2025, all outstanding borrowings under the primary credit facility were Term Benchmark borrowings denominated in U.S.

The interest rate on borrowings is dependent on the class, type and currencies of borrowings and will be one of the following options:

• any Term Benchmark borrowing denominated in U.S.

Dollars will utilize the Secured Overnight Financing Rate (“SOFR”) for one, three, or six-month tenors as elected, which is a rate per annum equal to the secured overnight financing rate for such business day published by the SOFR Administrator, the Federal Reserve Bank of New York, on the immediately succeeding business day, plus ten hundredths percent ( 0.10 %), plus the Revolving Commitment Term Benchmark spread or Term Loan Benchmark spread which can range from 100.0 to 175.0 basis points based on the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA;

Commitment Term Benchmark spread or Term Loan Benchmark spread which can range from 100.0 to 175.0 basis points based on the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA;

• any Term Benchmark borrowing denominated in Euros will utilize the Euro Interbank Offered Rate (“EURIBOR”) in effect two target days prior to the advance (adjusted upwards to reflect bank reserve costs) for such interest period as defined in the agreement, plus the Revolving Commitment Term Benchmark spread or Term Loan Term Benchmark spread which can range from 100.0 to 175.0 basis points based on the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA;

10 unchanged sentences

• an interest coverage ratio, defined as that ratio of consolidated EBITDA for such period to cash interest expense for such period, for any period of four consecutive fiscal quarters, to not be less than 3.5 to 1.0.

The Company had $ 0.4 million in letters of credit contingently committed against the primary credit facility at both December 31, 2024 and June 30, 2024.

The Company had $ 0.4 million in letters of credit contingently committed against the primary credit facility at both March 31, 2025 and June 30, 2024.

(2) Concurrently on December 20, 2024 with its entry into the restated primary credit facility, the Company terminated its 364-day multi-currency revolving credit facility agreement (the “secondary credit facility”), which was entered into on January 5, 2024 and originally scheduled to mature on January 3, 2025.

6 unchanged sentences

The revolving borrowings on the primary credit facility matures on May 4, 2027.

As of December 31, 2024, the contractual maturities of the term borrowings on the primary credit facility were as follows:

As of March 31, 2025, the contractual maturities of the term borrowings on the primary credit facility were as follows:

(Amounts in Millions) Contractual Maturities

2 unchanged sentences

Total $ 98.75

The weighted-average interest rate on borrowings outstanding under the credit facilities at December 31, 2024 and June 30, 2024 were 6.4 % and 6.8 %, respectively.

The weighted-average interest rate on borrowings outstanding under the credit facilities at March 31, 2025 and June 30, 2024 were 5.9 % and 6.8 %, respectively.

The Company categorizes assets and liabilities measured at fair value into three levels based upon the assumptions (inputs) used to price the assets or liabilities.

5 unchanged sentences

Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability.

There were no changes in the inputs or valuation techniques used to measure fair values during the six months ended December 31, 2024.

There were no changes in the inputs or valuation techniques used to measure fair values during the nine months ended March 31, 2025.

For more information on inputs and fair valuation techniques used, refer to our Annual Report on Form 10-K for the year ended June 30, 2024.

Recurring Fair Value Measurements:

As of December 31, 2024 and June 30, 2024, the fair values of financial assets and liabilities that are measured at fair value on a recurring basis using the market approach are categorized as follows:

December 31, 2024

As of March 31, 2025 and June 30, 2024, the fair values of financial assets and liabilities that are measured at fair value on a recurring basis using the market approach are categorized as follows:

March 31, 2025

(Amounts in Thousands) Level 1 Level 2 Total

Cash equivalents $ 4,329 $ — $ 4,329

foreign exchange contracts $ — $ 994 $ 994

12 unchanged sentences

Total liabilities at fair value $ — $ 2,485 $ 2,485

We had no level 3 assets or liabilities at December 31, 2024 and June 30, 2024, or any activity in Level 3 assets or liabilities during the six months ended December 31, 2024.

We had no level 3 assets or liabilities at March 31, 2025 and June 30, 2024, or any activity in Level 3 assets or liabilities during the nine months ended March 31, 2025.

The nonqualified supplemental employee retirement plan (“SERP”) assets consist primarily of equity funds, balanced funds, bond funds, and a money market fund.

3 unchanged sentences

Financial instruments that are not reflected in the Condensed Consolidated Balance Sheets at fair value that have carrying amounts which approximate fair value include notes receivable and borrowings under credit facilities.

There were no changes to the inputs and valuation techniques used to assess the fair value of these financial instruments during the six months ended December 31, 2024.

There were no changes to the inputs and valuation techniques used to assess the fair value of these financial instruments during the nine months ended March 31, 2025.

For more information on inputs and fair valuation techniques used, refer to our Annual Report on Form 10-K for the year ended June 30, 2024.

9 unchanged sentences

Non-designated foreign exchange contracts are also used to hedge against foreign currency exchange rate risks related to intercompany balances and other balance sheet positions denominated in currencies other than the functional currencies.

As of December 31, 2024, we had outstanding foreign exchange contracts to hedge currencies against the U.S.

As of March 31, 2025, we had outstanding foreign exchange contracts to hedge currencies against the U.S.

dollar in the aggregate notional amount of $ 11.9 million and to hedge currencies against the Euro in the aggregate notional amount of 47.0 million Euro.

6 unchanged sentences

The gain or loss associated with derivative instruments that are not designated as hedging instruments or that cease to meet the criteria for hedging under FASB guidance is reported immediately in Non-operating income (expense), net on the Condensed Consolidated Statements of Income.

Based on fair values as of December 31, 2024, we estimate that approximately $ 2.8 million of pre-tax derivative loss deferred in Accumulated Other Comprehensive Loss will be reclassified into earnings, along with the earnings effects of related forecasted transactions, within the next 12 months.

Based on fair values as of March 31, 2025, we estimate that approximately $ 1.2 million of pre-tax derivative loss deferred in Accumulated Other Comprehensive Loss will be reclassified into earnings, along with the earnings effects of related forecasted transactions, within the next 12 months.

Gains on foreign exchange contracts are generally offset by losses in operating income in the income statement when the underlying hedged transaction is recognized in earnings.

Because gains or losses on foreign exchange contracts fluctuate partially based on currency spot rates, the future effect on earnings of the cash flow hedges alone is not determinable, but in conjunction with the underlying hedged transactions, the result is expected to be a decline in currency risk.

The maximum length of time we had hedged our exposure to the variability in future cash flows was 12 months as of both December 31, 2024 and June 30, 2024.

The maximum length of time we had hedged our exposure to the variability in future cash flows was 12 months as of both March 31, 2025 and June 30, 2024.

See Note 9 - Fair Value of Notes to Condensed Consolidated Financial Statements for further information regarding the fair value of derivative assets and liabilities and Note 6 - Accumulated Other Comprehensive Income (Loss) of Notes to Condensed Consolidated Financial Statements for the changes in deferred derivative gains and losses.

3 unchanged sentences

Fair Value As of Fair Value As of

(Amounts in Thousands) Balance Sheet Location December 31,

(Amounts in Thousands) Balance Sheet Location March 31,

2025 June 30,

2024 Balance Sheet Location December 31,

2024 Balance Sheet Location March 31,

2025 June 30,

5 unchanged sentences

The Effect of Derivative Instruments on Other Comprehensive Income (Loss)

Three Months Ended Six Months Ended

December 31 December 31

Three Months Ended Nine Months Ended

March 31 March 31

(Amounts in Thousands) 2025 2024 2025 2024

2 unchanged sentences

The Effect of Derivative Instruments on Condensed Consolidated Statements of Income

Three Months Ended Six Months Ended

(Amounts in Thousands) December 31 December 31

Three Months Ended Nine Months Ended

(Amounts in Thousands) March 31 March 31

Derivatives in Cash Flow Hedging Relationships Location of Gain or (Loss) 2025 2024 2025 2024

10 unchanged sentences

The Company also provides a discretionary contribution determined annually by the Talent, Culture, and Compensation Committee of the Company’s Board of Directors.

Total expense related to employer contributions to the domestic retirement plans was $ 1.0 million and $ 3.1 million for the six months ended December 31, 2024 and December 31, 2023, respectively.

Total expense related to employer contributions to the domestic retirement plans was $ 1.6 million and $ 3.7 million for the nine months ended March 31, 2025 and March 31, 2024, respectively.

The Company also maintains a supplemental employee retirement plan (“SERP”) for executives and other key employees which enables them to defer cash compensation on a pre-tax basis and restore amounts that would otherwise be payable under our tax-qualified retirement plans if the IRS did not have limits on includable compensation and maximum benefits.

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A SERP liability of the same amount is recorded on the balance sheet representing an obligation to distribute SERP funds to participants.

As of December 31, 2024, both total investments and obligations under SERP were $ 5.6 million, of which $ 2.0 million were short term and $ 3.6 million were long term.

As of March 31, 2025, both total investments and obligations under SERP were $ 3.8 million, of which $ 0.5 million were short term and $ 3.3 million were long term.

As of June 30, 2024, both total investments and obligations under SERP were $ 5.4 million, of which $ 2.0 million were short term and $ 3.4 million were long term.

The SERP investment assets are classified as trading, and accordingly, realized and unrealized gains and losses are recognized in the Other Income (Expense) category on

our Condensed Consolidated Statements of Income.

The SERP investment assets are classified as trading, and accordingly, realized and unrealized gains and losses are recognized in the Other Income (Expense) category on our Condensed

Consolidated Statements of Income.

Adjustments made to revalue the SERP liability are also recognized in income as selling and administrative expenses and offset valuation adjustments on SERP investment assets.

The change in net unrealized holding gains for the six months ended December 31, 2024 and 2023 was less than $ 0.1 million and $ 0.1 million, respectively.

The change in net unrealized holding (losses) gains for the nine months ended March 31, 2025 and 2024 was approximately $( 0.4 ) million and $ 0.4 million, respectively.

Defined Benefit Postemployment Plan:

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Benefits are paid using available cash on hand when eligible employees meet plan qualifications for payment.

As of December 31, 2024, total obligations under these plans were $ 7.0 million of which $ 6.2 million were long term and $ 0.8 million were short term.

As of March 31, 2025, total obligations under these plans were $ 7.3 million of which $ 6.5 million were long term and $ 0.8 million were short term.

As of June 30, 2024, total obligations under these plans were $ 7.0 million of which $ 6.2 million were long term and $ 0.8 million were short term.

Net periodic benefit costs were not material for the six months ended December 31, 2024 and 2023.

Net periodic benefit costs were not material for the nine months ended March 31, 2025 and 2024.

Stock Compensation Plans

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For more information on the 2023 Plan and the Deferral Plan, refer to our Annual Report on Form 10-K for the year ended June 30, 2024.

During the first six months of fiscal year 2025, the following stock compensation was granted under the 2023 Plan and the Deferral Plan.

During the first nine months of fiscal year 2025, the following stock compensation was granted under the 2023 Plan and the Deferral Plan.

Stock Compensation Granted Quarter Granted Shares/Units Grant Date Fair Value (2)

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Goodwill, net $ 6,191

Balance as of December 31, 2024

Balance as of March 31, 2025

Goodwill $ 19,017

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The estimated useful life of internal-use software ranges from 3 years to 10 years.

For the three months ended December 31, 2024 and 2023, amortization expense of other intangible assets was $ 0.3 million and $ 0.6 million, respectively.

For the six months ended December 31, 2024 and 2023, amortization expense of other intangible assets was $ 0.5 million and $ 1.5 million, respectively.

The three and six months ended December 31, 2023 included the amortization on customer relationships, technology, and trade name intangible assets associated with GES.

For the three months ended March 31, 2025 and 2024, amortization expense of other intangible assets was $ 0.2 million and $ 0.5 million, respectively.

For the nine months ended March 31, 2025 and 2024, amortization expense of other intangible assets was $ 0.8 million and $ 2.0 million, respectively.

The three and nine months ended March 31, 2024 included the amortization on customer relationships, technology, and trade name intangible assets associated with GES.

See Note 3 - Sale of GES of Notes to Condensed Consolidated Financial Statements for additional information.

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The Repurchase Plan has no expiration date but may be suspended or discontinued at any time.

During the six months ended December 31, 2024, the Company repurchased $ 5.9 million shares of common stock under the Repurchase Plan at an average price of $ 18.60 per share.

During the six months ended December 31, 2023, the Company had no repurchases under the Repurchase Plan.

During the nine months ended March 31, 2025, the Company repurchased $ 8.9 million of common stock under the Repurchase Plan at an average price of $ 18.10 per share.

During the nine months ended March 31, 2024, the Company had no repurchases under the Repurchase Plan.

Since the inception of the Repurchase Plan, the Company has repurchased $ 100.7 million of common stock at an average cost of $ 15.63 per share.

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Basic and diluted earnings per share were calculated as follows under the two-class method:

Three Months Ended Six Months Ended

December 31 December 31

Three Months Ended Nine Months Ended

March 31 March 31

(Amounts in thousands, except per share data) 2025 2024 2025 2024

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Diluted $ 0.15 $ ( 0.24 ) $ 0.41 $ 0.51

For the three months ended March 31, 2024, all 434,000 outstanding stock compensation awards were antidilutive, as a result of the net loss recognized for the period, and were excluded from the dilutive calculation.

The net loss in the three months ended March 31, 2024 was not allocated to participating securities as the holders have no requirements to fund losses.

For the nine months ended March 31, 2024 and for the three and nine months ended March 31, 2025, all outstanding stock compensation awards were dilutive and were included in the dilutive calculation.

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

What changed 10-Q

Item 1. Financial Statements