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Item 8. Financial Statements and Supplementary Data

2024-11-22 compared with 2023-11-17 · 278 added, 241 removed, 1134 unchanged (31% of the section changed)

83 unchanged sentences

Description of the Matter As more fully described in Note 23 to the consolidated financial statements, during 2024, the Company performed its annual goodwill impairment test as of January 1, 2024 and determined that the estimated fair value of the SGK Brand Solutions reporting unit, within the SGK Brand Solutions segment, exceeded the carrying value (expressed as a percentage of carrying value) by approximately 7%.

Because of the limited excess fair value over carrying value and further declines experienced by the SGK Brand Solutions reporting unit, the Company determined that a triggering event occurred during the fourth quarter of fiscal 2023, resulting in an interim assessment of goodwill for the reporting unit as of September 1, 2023.

The results of this review indicated that the estimated fair value of the Company's SGK Brand Solutions reporting unit exceeded the carrying value (expressed as a percentage of carrying value) by approximately 4%.

The Company utilized a combination of the income approach using the estimated discounted cash flows and a market-based valuation methodology.

Significant assumptions used in the Company’s fair value estimate included estimates of revenue growth, EBITDA contribution and the discount rates.

Auditing the annual and interim goodwill impairment analyses was complex, as it included estimating the fair value of the reporting unit.

In particular, the fair value estimates are sensitive to the significant assumptions named above, which are affected by expected future market or economic conditions.

Significant assumptions used in the Company’s fair value estimate included the estimates of revenue growth, EBITDA contribution and the discount rates.

Auditing the annual impairment analysis was complex, as it included estimating the fair value of the reporting unit.

In particular, the fair value estimate is sensitive to the significant assumptions named above, which are affected by expected future market or economic conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of internal controls over the Company’s goodwill impairment review process.

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Inventories 237,888 260,409

Restricted cash, current — 2,398

Contract assets 92,969 74,646

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Trade accounts payable 108,362 114,316

Accrued rebates 23,766 22,349

Accrued compensation 88,781 58,872

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Goodwill write-downs ( 16,727 ) — ( 82,454 )

Operating profit (loss) 88,117 ( 43,937 ) 42,034

Operating (loss) profit ( 12,323 ) 88,117 ( 43,937 )

Interest expense ( 50,534 ) ( 44,648 ) ( 27,725 )

Other income (deductions), net ( 6,800 ) ( 2,559 ) ( 32,557 )

Income (loss) before income taxes 40,910 ( 104,219 ) 9,233

Income tax (provision) benefit ( 1,774 ) 4,391 ( 6,375 )

Net income (loss) 39,136 ( 99,828 ) 2,858

(Loss) income before income taxes ( 69,657 ) 40,910 ( 104,219 )

Income tax benefit (provision) 9,997 ( 1,774 ) 4,391

Net (loss) income ( 59,660 ) 39,136 ( 99,828 )

Net loss attributable to noncontrolling interests — 155 54

Net income (loss) attributable to Matthews shareholders $ 39,291 $ ( 99,774 ) $ 2,910

Earnings (loss) per share attributable to Matthews shareholders:

Net (loss) income attributable to Matthews shareholders $ ( 59,660 ) $ 39,291 $ ( 99,774 )

(Loss) earnings per share attributable to Matthews shareholders:

Basic $ ( 1.93 ) $ 1.28 $ ( 3.18 )

7 unchanged sentences

Matthews Noncontrolling Interest Total

Net income (loss) $ 39,291 $ ( 155 ) $ 39,136

Net loss $ ( 59,660 ) $ — $ ( 59,660 )

Other comprehensive income (loss), net of tax:

1 unchanged sentence

Pension plans and other postretirement benefits ( 1,805 ) — ( 1,805 )

Unrecognized gain (loss) on cash flow hedges:

Unrecognized loss on cash flow hedges:

Net change from periodic revaluation ( 6,104 ) — ( 6,104 )

Net amount reclassified to earnings ( 2,002 ) — ( 2,002 )

Net change in unrecognized gain on cash flow hedges 1,095 — 1,095

Net change in unrecognized loss on cash flow hedges ( 8,106 ) — ( 8,106 )

Other comprehensive income, net of tax 5,662 23 5,685

Comprehensive income (loss) $ 55,078 $ ( 144 ) $ 54,934

Comprehensive (loss) income $ ( 53,998 ) $ 23 $ ( 53,975 )

Year Ended September 30, 2023

Matthews Noncontrolling Interest Total

Net loss $ ( 99,774 ) $ ( 54 ) $ ( 99,828 )

Other comprehensive (loss) income, net of tax:

Net income (loss) $ 39,291 $ ( 155 ) $ 39,136

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustment 13,114 11 13,125

Pension plans and other postretirement benefits 1,578 — 1,578

Unrecognized gain on cash flow hedges:

Unrecognized gain (loss) on cash flow hedges:

Net change from periodic revaluation 3,056 — 3,056

2 unchanged sentences

Other comprehensive income, net of tax 15,787 11 15,798

Comprehensive loss $ ( 97,226 ) $ ( 40 ) $ ( 97,266 )

Comprehensive income (loss) $ 55,078 $ ( 144 ) $ 54,934

Year Ended September 30, 2022

Matthews Noncontrolling Interest Total

Net income (loss) $ 2,910 $ ( 52 ) $ 2,858

Net loss $ ( 99,774 ) $ ( 54 ) $ ( 99,828 )

Other comprehensive (loss) income, net of tax:

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Net change in unrecognized gain on cash flow hedges 9,495 — 9,495

Other comprehensive income (loss), net of tax 47,980 ( 127 ) 47,853

Comprehensive income (loss) $ 50,890 $ ( 179 ) $ 50,711

Other comprehensive income, net of tax 2,548 14 2,562

Comprehensive loss $ ( 97,226 ) $ ( 40 ) $ ( 97,266 )

The accompanying notes are an integral part of these consolidated financial statements.

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Balance, September 30, 2021 $ 36,334 $ 149,484 $ 834,208 $ ( 192,739 ) $ ( 190,739 ) $ ( 145 ) $ 636,403

Net income (loss) — — 2,910 — — ( 52 ) 2,858

Net loss — — ( 99,774 ) — — ( 54 ) ( 99,828 )

Pension plans and other

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Fair value of cash flow hedges — — — 9,495 — — 9,495

Total comprehensive income 50,711

Total comprehensive loss ( 97,266 )

Stock-based compensation — 17,432 — — — — 17,432

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Dividends — — ( 27,685 ) — — — ( 27,685 )

Transactions with noncontrolling

interests — ( 1,168 ) — — — ( 592 ) ( 1,760 )

Divestiture — — — — — ( 91 ) ( 91 )

Balance, September 30, 2022 $ 36,334 $ 160,255 $ 706,749 $ ( 190,191 ) $ ( 225,795 ) $ ( 276 ) $ 487,076

Net loss — — ( 99,774 ) — — ( 54 ) ( 99,828 )

Net income (loss) — — 39,291 — — ( 155 ) 39,136

Pension plans and other

2 unchanged sentences

Fair value of cash flow hedges — — — 1,095 — — 1,095

Total comprehensive loss ( 97,266 )

Total comprehensive income 54,934

Stock-based compensation — 17,308 — — — — 17,308

9 unchanged sentences

Dividends — — ( 31,313 ) — — — ( 31,313 )

Divestiture — — — — — ( 91 ) ( 91 )

Transactions with noncontrolling

interests — — — — — 33 33

Balance, September 30, 2023 $ 36,334 $ 168,211 $ 714,727 $ ( 174,404 ) $ ( 219,200 ) $ ( 387 ) $ 525,281

Net income (loss) — — 39,291 — — ( 155 ) 39,136

Net loss — — ( 59,660 ) — — — ( 59,660 )

Pension plans and other

2 unchanged sentences

Fair value of cash flow hedges — — — ( 8,106 ) — — ( 8,106 )

Total comprehensive income 54,934

Total comprehensive loss ( 53,975 )

Stock-based compensation — 18,478 — — — — 18,478

5 unchanged sentences

— ( 26,780 ) — — 26,780 — —

Cancellation of 34,327 shares of

treasury stock

— 1,958 — — ( 1,958 ) — —

Dividends — — ( 32,004 ) — — — ( 32,004 )

9 unchanged sentences

Cash flows from operating activities:

Net income (loss) $ 39,136 $ ( 99,828 ) $ 2,858

Adjustments to reconcile net income (loss) to net cash flows from operating activities:

Net (loss) income $ ( 59,660 ) $ 39,136 $ ( 99,828 )

Adjustments to reconcile net (loss) income to net cash flows from operating activities:

Depreciation and amortization 94,770 96,530 104,056

Stock-based compensation expense 18,478 17,308 17,432

Deferred tax (benefit) provision ( 21,626 ) ( 32,962 ) 4,158

Deferred tax benefit ( 25,223 ) ( 21,626 ) ( 32,962 )

Gain on divestitures and sale of assets, net ( 1,428 ) ( 2,980 ) ( 3,390 )

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Acquisition holdback and contingent consideration payments — — ( 725 )

Transactions with noncontrolling interests — — ( 1,760 )

Payments of debt issuance costs ( 10,154 ) — —

Proceeds from net investment hedges 58,432 — —

Other financing activities — ( 912 ) ( 2,774 )

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Memorialization products consist primarily of bronze and granite memorials and other memorialization products, caskets, cremation-related products, and cremation and incineration equipment primarily for the cemetery and funeral home industries.

Industrial Technologies includes the design, manufacturing, service and distribution of high-tech custom energy storage solutions;

Industrial Technologies includes the design, manufacturing, service and sales of high-tech custom energy storage solutions;

product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products;

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Actual results could differ from those estimates.

Reclassifications:

Certain reclassifications have been made to the prior year financial statements to conform to the current year presentation.

These reclassifications are not material to the prior year presentation.

Cash, Cash Equivalents and Restricted Cash:

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An impairment loss would be recognized when the carrying amount of the assets exceeds the fair value, which is based on a discounted cash flow analysis.

No such charges were recognized during the years presented, except as disclosed in Note 23, “Asset Write-Downs."

An asset considered held-for-sale is reported at the lower of the asset's carrying amount or fair value, less cost to sell.

No impairment charges for property, plant and equipment were recognized during the years presented, except as disclosed in Note 24, “Asset Write-Downs."

A lease exists at contract inception if the contract conveys the right to control an identified asset for a period of time in exchange for consideration.

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ACCOUNTING PRONOUNCEMENTS:

In October 2021, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No.

2021-08, Business Combinations (Topic 805) which improves the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract asset/liability, and payment terms and their effect on subsequent revenue recognized by the acquirer.

This ASU is effective for the Company beginning in interim periods starting in fiscal 2024.

While the impact of this ASU is dependent on the nature of any future transactions, the Company currently does not expect this ASU to have a significant impact on its consolidated financial statements.

In September 2022, the FASB issued ASU No.

2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50) which enhances the transparency of supplier finance programs by addressing disclosure requirements.

Specifically, the amendment requires disclosure of key program terms, amounts outstanding, balance sheet presentation, and a rollforward of amounts outstanding during the annual period.

The ASU will be effective beginning in the first quarter of fiscal 2024, except for the rollforward requirement, which is effective in fiscal year 2025.

In December 2023, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No.

2023-09, Income Taxes (Topic 740) which enhances the transparency and decision usefulness of income tax disclosures including rate reconciliations and income taxes paid among other tax disclosures.

The ASU is effective for annual periods for the Company beginning in fiscal year 2026.

The Company is in the process of assessing the impact this ASU will have on its consolidated financial statements.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280) which improves financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities, including enhanced disclosures about significant segment expenses.

The ASU is effective for annual periods for the Company beginning in fiscal year 2025, and interim periods beginning in fiscal year 2026.

The Company is in the process of assessing the impact this ASU will have on its consolidated financial statements.

In October 2023, the FASB issued ASU No.

2023-06, Disclosure Improvements.

The amendments in this update affect the presentation and disclosure of a variety of topics in the Accounting Standards Codification, and align them with the Securities and Exchange Commission ("SEC") regulations.

The effective date of the amendments of this ASU will be determined for each individual disclosure based on the effective date of the SEC’s removal of the related disclosure from Regulation S-X or Regulation S-K.

If the SEC has not removed the applicable requirements from Regulation S-X or Regulation S-K by June 30, 2027, then this ASU will not become effective.

The adoption of this ASU is not expected to have a material impact on the Company's consolidated financial statements.

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The adoption of this ASU in the fourth quarter of fiscal 2023 had no material impact on the Company's consolidated financial statements.

In August 2018, the FASB issued ASU No.

2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20) , which modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans.

The adoption of this ASU in the first quarter ended December 31, 2020 had no material impact on the Company's consolidated financial statements.

In June 2016, the FASB issued ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326) , which provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each report date.

Subsequently, the FASB issued ASU No.

2019-11, Codification Improvements to Topic 326, Financial Instruments—Credit Losses and ASU No.

2020-02, Financial Instruments—Credit Losses (Topic 326) and Leases (Topic 842) , that provide certain amendments to the new guidance.

The adoption of these ASUs in the first quarter ended December 31, 2020 had no material impact on the Company's consolidated financial statements.

In September 2022, the FASB issued ASU No.

2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50) which enhances the transparency of supplier finance programs by addressing disclosure requirements.

Specifically, the amendment requires disclosure of key program terms, amounts outstanding, balance sheet presentation, and a rollforward of amounts outstanding during the annual period.

The rollforward of amounts outstanding during the annual period is effective for annual periods for the Company beginning in fiscal year 2025.

The adoption of the remaining provisions of this ASU in the first quarter of fiscal 2024 had no material impact on the Company's consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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ACCOUNTING PRONOUNCEMENTS, (continued)

The following table summarizes the activity for the accounts receivable allowance for doubtful accounts for the years ended September 30, 2023, 2022 and 2021.

Description Balance at Beginning of Period Charged to Expense Charged to other Accounts Deductions (1)

End of Period

Allowance for Doubtful Accounts:

Fiscal Year Ended:

September 30, 2023 $ 10,138 $ 1,625 $ — $ ( 979 ) $ 10,784

September 30, 2022 10,654 1,368 — ( 1,884 ) 10,138

September 30, 2021 9,618 2,182 — ( 1,146 ) 10,654

(1) Amounts determined not to be collectible (including direct write-offs), net of recoveries.

The Company facilitates a voluntary supply chain finance program (the "Program") to provide certain suppliers with the opportunity to sell receivables due from the Company to participating financial institutions at the sole discretion of both the suppliers and the financial institutions.

The Company is not a party to the agreements between the suppliers and the financial institutions and has no economic interest in a supplier's decision to sell a receivable.

The range of payment terms negotiated with a supplier is consistent, irrespective of whether a supplier participates in the Program.

All outstanding payments owed under the Program are recorded within trade accounts payable in the Consolidated Balance Sheets.

The Company accounts for all payments made under the Program as a reduction to operating cash flows in changes in working capital within the Consolidated Statements of Cash Flows.

The amounts owed to a participating financial institution under the Program and included in trade accounts payable were $ 3,014 and $ 3,027 at September 30, 2024 and 2023, respectively.

In October 2021, the FASB issued ASU No.

The adoption of this ASU in the first quarter of fiscal 2024 had no material impact on the Company's consolidated financial statements.

REVENUE RECOGNITION:

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Revenue from products or services provided to customers over time accounted for approximately 18 %, 15 %, and 12 % of revenue for the years ended September 30, 2024, 2023, and 2022, respectively.

As of September 30, 2024 and 2023, the Company had net contract assets for projects recognized using the over time method totaling $ 64,246 and $ 37,711 , respectively, which primarily represent unbilled revenues, net of deferred revenues related to customer deposits and progress billings.

Net contract assets at September 30, 2024 predominantly related to ongoing projects with the Company's largest energy storage customer.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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FAIR VALUE MEASUREMENTS:

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

F air value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

A three level fair value hierarchy is used to prioritize the inputs used in valuations, as defined below:

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Level 1 Level 2 Level 3 Total

Derivatives (1)

$ — $ 4,006 $ — $ 4,006

Equity and fixed income mutual funds $ — $ 839 $ — $ 839

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Total assets at fair value $ — $ 9,631 $ — $ 9,631

Derivatives (1)

$ — $ 2,766 $ — $ 2,766

Total liabilities at fair value $ — $ 2,766 $ — $ 2,766

(1) Interest rate swaps and cross currency swaps are valued based on observable market swap rates and are classified within Level 2 of the fair value hierarchy.

(2) Fiscal 2024 derivative amount includes $ 58,432 of partial advance payments received from the counterparties to certain cross-currency swaps.

See Note 12, "Derivatives and Hedging Activities" for further details.

The carrying values for other financial assets and liabilities approximated fair value for the years ended September 30, 2024 and 2023.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

ALLOWANCE FOR DOUBTFUL ACCOUNTS:

The following table summarizes the activity for the accounts receivable allowance for doubtful accounts for the years ended September 30, 2024, 2023 and 2022.

Description Balance at Beginning of Period Charged to Expense Charged to other Accounts Deductions (1)

Balance at End of Period

September 30, 2024 $ 10,784 $ 2,696 $ — $ ( 1,425 ) $ 12,055

September 30, 2023 10,138 1,625 — ( 979 ) 10,784

September 30, 2022 10,654 1,368 — ( 1,884 ) 10,138

(1) Amounts determined not to be collectible (including direct write-offs), net of recoveries.

Inventories at September 30, 2024 and 2023 consisted of the following:

3 unchanged sentences

$ 237,888 $ 260,409

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

At September 30, 2024 and 2023, non-current investments were as follows:

4 unchanged sentences

$ 23,076 $ 24,988

During fiscal 2023, the Company purchased the remaining ownership interest in a small Industrial Technologies business, which was previously held as an equity-method investment.

See Note 21, "Acquisitions and Divestitures."

As of September 30, 2024, the Company had an investment in Liquid X Printed Metals Inc.

(“Liquid X”), a private company specializing in ink technologies.

One of the Company's Executive Officers and member of Matthews' Board of Directors serves as President and CEO of Liquid X.

During the fourth quarter of fiscal 2024, in anticipation of a disposal transaction, the Company recognized a non-cash impairment charge of $ 3,131 , representing a full write-down of its cost-method investment in Liquid X.

This write-down was recorded as a component of other income (deductions), net, for the year ended September 30, 2024.

The disposal transaction was completed in October 2024, subsequent to the fiscal 2024 year end.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

PROPERTY, PLANT AND EQUIPMENT:

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Revolving credit facilities $ 444,011 $ 463,168

2027 Senior Secured Notes 294,751 —

2025 Senior Notes — 298,500

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Long-term debt $ 769,614 $ 786,484

The Company has a domestic credit facility with a syndicate of financial institutions that includes a $ 750,000 senior secured revolving credit facility, which matures in March 2025.

The Company has a domestic credit facility with a syndicate of financial institutions that was amended and restated in September 2024.

The amended and restated loan agreement includes a $ 750,000 senior secured revolving credit facility, which matures in January 2029, subject to the terms and conditions of the amended facility.

The obligations under the domestic credit facility are secured by a first priority lien on substantially all of the Company's and certain of its domestic subsidiaries' assets.

A portion of the revolving credit facility (not to exceed $ 350,000 ) can be drawn in foreign currencies.

In March 2023, an amendment to the domestic credit facility implemented SOFR as the replacement of LIBOR as the benchmark interest rate under the facility.

The Company accounted for the change in reference rate as a non-substantial modification.

Borrowings under the revolving credit facility now bear interest at SOFR, plus a 0.10 % per annum rate spread adjustment, plus a factor ranging from 0.75 % to 2.00 % ( 1.25 % at September 30, 2023) based on the Company's secured leverage ratio.

Previously, borrowings under the revolving credit facility bore interest at LIBOR plus a factor ranging from 0.75 % to 2.00 % based on the Company's secured leverage ratio.

The secured leverage ratio is defined as net secured indebtedness divided by EBITDA (earnings before interest, income taxes, depreciation and amortization) as defined within the domestic credit facility agreement.

The Company is required to pay an annual commitment fee ranging from 0.15 %

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

DEBT AND FINANCING ARRANGEMENTS, (continued)

to 0.30 % (based on the Company's leverage ratio) of the unused portion of the revolving credit facility.

The Company incurred debt issuance costs in connection with the domestic credit facility.

Unamortized costs were $ 949 and $ 1,522 at September 30, 2023 and September 30, 2022, respectively.

Borrowings under the revolving credit facility bear interest at Secured Overnight Financing Rate ("SOFR"), plus a 0.10 % per annum rate spread adjustment, plus a factor ranging from 1.00 % to 2.00 % ( 1.50 % at September 30, 2024) based on the Company's leverage ratio.

The leverage ratio is defined as total indebtedness divided by EBITDA (earnings before interest, income taxes, depreciation and amortization) as defined within the domestic credit facility agreement.

The Company is required to pay an annual commitment fee ranging from 0.15 % to 0.30 % (based on the Company's leverage ratio) of the unused portion of the revolving credit facility.

The Company incurred debt issuance costs of $ 4,905 in connection with the amended and restated agreement, which were deferred and are being amortized over the term of the facility.

Unamortized costs were $ 4,961 and $ 949 at September 30, 2024 and 2023, respectively.

The domestic credit facility requires the Company to maintain certain leverage and interest coverage ratios.

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The weighted-average interest rate on outstanding borrowings for the domestic credit facility (including the effects of interest rate swaps and Euro denominated borrowings) at September 30, 2024 and 2023 was 4.59 % and 5.95 %, respectively.

The Company has $ 299,625 of 5.25 % senior unsecured notes due December 1, 2025 (the "2025 Senior Notes").

The 2025 Senior Notes bear interest at a rate of 5.25 % per annum with interest payable semi-annually in arrears on June 1 and December 1 of each year.

The Company's obligations under the 2025 Senior Notes are guaranteed by certain of the Company's direct and indirect wholly-owned domestic subsidiaries.

The Company is subject to certain covenants and other restrictions in connection with the 2025 Senior Notes.

The Company incurred direct financing fees and costs in connection with 2025 Senior Notes.

Unamortized costs were $ 1,125 and $ 1,664 at September 30, 2023 and 2022, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

DEBT AND FINANCING ARRANGEMENTS, (continued)

In September 2024, the Company issued $ 300,000 aggregate principal amount of 8.625 % senior secured second lien notes due October 1, 2027 (the "2027 Senior Secured Notes").

The 2027 Senior Secured Notes bear interest at a rate of 8.625 % per annum with interest payable semi-annually in arrears on April 1 and October 1 of each year beginning on April 1, 2025.

The Company's obligations under the 2027 Senior Secured Notes are secured by a second priority lien on substantially all of the Company’s and certain of its domestic subsidiaries’ assets.

The Company is subject to certain covenants and other restrictions in connection with the 2027 Senior Secured Notes.

The net proceeds from the 2027 Senior Secured Notes, together with additional funds borrowed under the Company’s domestic credit facility, were irrevocably deposited into a trust and were subsequently used to redeem all of the Company’s outstanding 5.25 % senior unsecured notes due December 1, 2025 (the “2025 Senior Notes”) on October 24, 2024, and to pay accrued and unpaid interest on the 2025 Senior Notes at such time.

Effective with the irrevocable deposit of these amounts into the trust in September 2024, the Company satisfied and discharged the indenture governing the 2025 Senior Notes in accordance with its terms.

Accordingly, the remaining unamortized direct financing costs from the 2025 Senior Notes, which totaled $ 585 , were charged to interest expense during the fourth quarter of fiscal 2024.

The Company incurred direct financing fees and costs of $ 5,249 in connection with 2027 Senior Secured Notes, which were deferred and are being amortized over the term of the 2027 Senior Secured Notes.

Unamortized costs related to the Company’s notes were $ 5,249 and $ 1,125 at September 30, 2024 and 2023, respectively.

The Company and certain of its domestic subsidiaries sell, on a continuous basis without recourse, their trade receivables to Matthews Receivables Funding Corporation, LLC (“Matthews RFC”), a wholly-owned bankruptcy-remote subsidiary of the Company.

In March 2022, Matthews RFC entered into a receivables purchase agreement (“RPA”) to sell up to $ 125,000 of receivables to certain purchasers (the “Purchasers”) on a recurring basis in exchange for cash (referred to as “capital” within the RPA) equal to the gross receivables transferred.

Matthews RFC has a receivables purchase agreement (“RPA”) to sell up to $ 125,000 of receivables to certain purchasers (the “Purchasers”) on a recurring basis in exchange for cash (referred to as “capital” within the RPA) equal to the gross receivables transferred.

The parties intend that the transfers of receivables to the Purchasers constitute purchases and sales of receivables.

Matthews RFC has guaranteed to each Purchaser the prompt payment of sold receivables, and has granted a security interest in its assets for the benefit of the Purchasers.

Under the RPA, which matures in March 2024, each Purchaser’s share of capital accrues yield at a floating rate plus an applicable margin.

Under the RPA, each Purchaser’s share of capital accrues yield at a floating rate plus an applicable margin.

The Company is the master servicer under the RPA, and is responsible for administering and collecting receivables.

The RPA, which had a maturity date of March 2024, was amended in March 2024 to extend the maturity date to March 2026.

The proceeds of the RPA are classified as operating activities in the Company’s Consolidated Statements of Cash Flows.

9 unchanged sentences

( 384,594 ) ( 388,283 )

Net cash proceeds received $ 5,210 $ 96,590

Net cash (payments) proceeds $ ( 5,500 ) $ 5,210

In March 2023, the Company, through its U.K.

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As these transfers qualify as true sales under the applicable accounting guidance, the receivables are de-recognized from the Company's Consolidated Balance Sheets upon transfer.

The principal amount of receivables sold under this arrangement was $ 55,159 during the fiscal year ended September 30, 2023.

The principal amount of receivables sold under this arrangement was $ 70,236 and $ 55,159 during the fiscal year ended September 30, 2024 and 2023, respectively.

The discounts on the trade receivables sold are included within administrative expense in the Consolidated Statements of Income.

The proceeds from the sale of receivables are classified as operating activities in the Company's Consolidated Statements of Cash Flows.

As of September 30, 2023, the amount of factored receivables that remained outstanding was $ 18,045 .

As of September 30, 2024 and 2023, the amount of factored receivables that remained outstanding was $ 15,665 and $ 18,045 , respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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This facility has no stated maturity date and is available until terminated.

There were no outstanding borrowings under the credit facility at September 30, 2023.

Outstanding borrowings under the credit facility totaled € 8.2 million ($ 8,050 ) at September 30, 2022.

The weighted-average interest rate on outstanding borrowings under this facility was 2.25 % at September 30, 2022.

There were no outstanding borrowings under the credit facility at September 30, 2024 or 2023.

Other borrowings totaled $ 15,602 and $ 19,241 at September 30, 2024 and 2023, respectively.

70 unchanged sentences

Other assets — — 3,086 —

Current liabilities:

Other current liabilities ( 863 ) ( 18,042 ) — —

Long-term liabilities:

1 unchanged sentence

Total derivatives (1)

$ ( 2,606 ) $ ( 66,967 ) $ 4,006 $ ( 2,766 )

(1) Fiscal 2024 cross-currency swaps amount includes $ 58,432 of partial advance payments received from the counterparties to certain swap contracts (see below).

The following table presents information related to interest rate swaps entered into by the Company and designated as cash flow hedges:

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Based on the Company's assessment, all of the critical terms of each of the hedges matched the underlying terms of the hedged debt and related forecasted interest payments, and as such, these hedges were considered highly effective.

The fair value of the interest rate swaps reflected a net unrealized gain of $ 4,006 ($ 2,991 after tax) and $ 10,699 ($ 7,937 after tax) at September 30, 2023 and 2022, respectively, that is included in shareholders' equity as part of accumulated other comprehensive income ("AOCI").

Unrecognized gains of $ 8,084 ($ 6,041 after tax) related to the terminated LIBOR-based swaps were also included in AOCI as of September 30, 2023.

The fair value of the interest rate swaps reflected a net unrealized loss of $ 2,606 ($ 1,948 after tax) and a net unrealized gain of $ 4,006 ($ 2,991 after tax) at September 30, 2024 and 2023, respectively, that is included in shareholders' equity as part of accumulated other comprehensive income ("AOCI").

Unrecognized gains of $ 3,848 ($ 2,874 after tax) and $ 8,084 ($ 6,041 after tax) related to previously terminated LIBOR-based swaps were also included in AOCI as of September 30, 2024 and 2023, respectively.

Assuming market rates remain constant with the rates at September 30, 2024, a gain (net of tax) of approximately $ 1,032 included in AOCI is expected to be recognized in earnings over the next twelve months.

The Company has a U.S.

Dollar/Euro cross currency swap with a notional amount of $ 81,392 as of September 30, 2023 and 2022, which has been designated as a net investment hedge of foreign operations.

The swap contract matures in September 2027.

The Company assesses hedge effectiveness for this contract based on changes in fair value attributable to changes in spot prices.

A loss of $ 2,065 (net of income taxes of $ 701 ) and a gain of $ 2,782 (net of income taxes of $ 940 ), which represented effective hedges of net investments, were reported as a component of AOCI within currency translation adjustment at September 30, 2023 and 2022, respectively.

Income of $ 1,159 and $ 1,645 , which represented the recognized portion of the fair value of cross currency swaps excluded from the assessment of hedge effectiveness, was included in current period earnings as a component of interest expense for fiscal 2023 and fiscal 2022, respectively.

At September 30, 2023 and 2022, the swap totaled $ 2,766 and $ 3,722 , respectively, and was included in other accrued liabilities and other assets in the Consolidated Balance Sheets, respectively.

The Company previously used certain foreign currency debt instruments as net investment hedges of foreign operations.

Currency losses of $ 5,370 (net of income taxes of $ 1,743 ), which represent effective hedges of net investments, were reported as a component of AOCI within currency translation adjustment at September 30, 2021.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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DERIVATIVES AND HEDGING ACTIVITIES, (continued)

The Company enters into certain derivative contracts in accordance with its risk management strategy that do not meet the criteria for hedge accounting but which have the economic impact of largely mitigating foreign currency exposure.

Changes in the fair value of these economic hedges are recorded in current period earnings as a component of other income (deductions), net.

During fiscal 2022, net gains from economic hedges (which largely offset losses from underlying foreign currency exposures) totaled $ 4,677 .

No such economic hedge contracts were outstanding as of September 30, 2023 or 2022.

The Company utilizes certain cross currency swaps as net investment hedges of foreign operations and assesses effectiveness for these contracts based on changes in fair value attributable to changes in spot prices.

The following table presents information related to cross currency swaps entered into by the Company and designated as net investment hedges:

Notional Amount Unrealized Losses Recognized in AOCI

Swap Currencies Maturity Date September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

USD/EUR September 2027 $ 81,392 $ 81,392 $ ( 5,440 ) $ ( 2,065 )

USD/SEK June 2025 20,000 — ( 468 ) —

USD/SGD August 2026 20,000 — ( 441 ) —

USD/EUR August 2026 25,000 — ( 30 ) —

$ 146,392 $ 81,392 $ ( 6,379 ) (1)

$ ( 2,065 ) (1)

(1) Total unrealized losses are presented net of tax of $ 2,156 and $ 701 , for the years ended September 30, 2024 and 2023, respectively.

In connection with certain of these cross currency swaps, the Company received cash from the counterparties, representing partial advance payments of amounts due under the U.S.

dollar leg of the swaps.

Such amounts totaled $ 58,432 , of which $ 17,416 and $ 41,016 were included in other current liabilities and other liabilities, respectively, on the Consolidated Balance Sheets at September 30, 2024.

The Company uses certain foreign currency debt instruments as net investment hedges of foreign operations with a notional amount of € 30,000 ($ 33,485 ) as of September 30, 2024.

Currency losses of $ 3,820 (net of income taxes of $ 1,113 ), which represent effective hedges of net investments, were reported as a component of AOCI within currency translation adjustment at September 30, 2024.

No such net investment hedges were outstanding as of September 30, 2023.

Refer to Note 17, "Accumulated Other Comprehensive Income" for further details regarding amounts recorded in AOCI and the Consolidated Statements of Income (Loss) related to derivatives.

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The Company has a stock repurchase program.

The buy-back program is designed to increase shareholder value, enlarge the Company's holdings of its common stock, and add to earnings per share.

The buy-back program is designed to increase shareholder value, enlarge the Company's holdings of its Class A Common Stock, and add to earnings per share.

Repurchased shares may be retained in treasury, utilized for acquisitions, or reissued to employees or other purchasers, subject to the restrictions set forth in the Company's Restated Articles of Incorporation.

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SHARE-BASED PAYMENTS:

The Company maintains an equity incentive plan (as amended and restated, the "2017 Equity Incentive Plan") that provides for grants of stock options, restricted shares, restricted share units, stock-based performance units and certain other types of stock-based awards.

The Company maintains an equity incentive plan (as amended and restated, the "2017 Equity Incentive Plan") that provides for grants of stock options, restricted shares, restricted share units ("RSUs"), stock-based performance units and certain other types of stock-based awards.

Under the 2017 Equity Incentive Plan, which has a ten -year term from the date the Company's Board of Directors approved of the amendment and restatement of the 2017 Equity Incentive Plan, the maximum number of shares available for grants or awards is an aggregate of 3,450,000 (subject to adjustment upon certain events such as stock dividends or stock splits), following the amendment and restatement of the 2017 Equity Incentive Plan at the Company's 2022 Annual Shareholder Meeting.

In November 2024, the Board of Directors approved the Second Amended and Restated 2017 Equity Incentive Plan (the "Second Amended 2017 Plan"), which increases the maximum number of shares available for grants or awards to an aggregate of 4,950,000 .

The Second Amended 2017 Plan is subject to shareholder approval at the February 2025 Annual Shareholder Meeting.

At September 30, 2024, 1,187,901 shares have been issued under the 2017 Equity Incentive Plan.

1,041,615 time-based restricted share units, 1,313,162 performance-based restricted share units, and 75,000 stock options have been granted under the 2017 Equity Incentive Plan.

1,233,583 time-based RSUs, 1,579,514 performance-based RSUs, and 75,000 stock options have been granted under the 2017 Equity Incentive Plan.

1,707,349 of these share-based awards are outstanding as of September 30, 2024.

The 2017 Equity Incentive Plan is administered by the Compensation Committee of the Board of Directors (the "Committee").

The number of shares issued under performance-based restricted share units may be up to 200 % of the number of performance-based restricted share units, based on the satisfaction of specific criteria established by the plan administrator.

The number of

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SHARE-BASED PAYMENTS, (continued)

shares issued under performance-based RSUs may be up to 200 % of the number of performance-based RSUs, based on the satisfaction of specific criteria established by the plan administrator.

For the years ended September 30, 2024, 2023 and 2022, stock-based compensation cost totaled $ 18,478 , $ 17,308 and $ 17,432 , respectively.

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The Company issues common stock from treasury shares once vested.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SHARE-BASED PAYMENTS, (continued)

The transactions for restricted shares and restricted share units for the year ended September 30, 2023 were as follows:

The transactions for RSUs for the year ended September 30, 2024 were as follows:

Shares Weighted-

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Non-vested at September 30, 2024 1,707,349 $ 33.59

During fiscal 2021, 75,000 stock options were granted under the 2017 Equity Incentive Plan.

During the third quarter of fiscal 2021, 75,000 stock options were granted under the 2017 Equity Incentive Plan.

The option price for each stock option granted was $ 41.70 , which was equal to the fair market value of the Company's Class A Common Stock on the date of grant.

These options vest in one-third increments annually over three years from the grant date.

Unvested stock options expire on the earlier of five years from the date of grant, or upon employment termination, retirement or death.

The Company generally settles employee stock option exercises with treasury shares.

During the second quarter of fiscal 2024, all of these stock options were forfeited in connection with an employee retirement.

As of September 30, 2024, the total unrecognized compensation cost related to all unvested stock-based awards was $ 18,469 which is expected to be recognized over a weighted-average period of 1.8 years.

The fair value of certain restricted share units that are subject to performance conditions and the fair value of stock options are estimated on the date of grant using a binomial lattice valuation model.

The fair value of certain RSUs that are subject to performance conditions are estimated on the date of grant using a binomial lattice valuation model.

The following table indicates the assumptions used in estimating the fair value of certain stock-based awards granted during the year ended September 30, 2024.

Share Units Stock

Expected volatility 31.8 %

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Expected volatilities are based on the historical volatility of the Company's stock price.

The expected term for grants in the year ended September 30, 2021 represents an estimate of the average period of time for restricted share units and stock options to vest.

The expected term for grants in the year ended September 30, 2024 represents an estimate of the average period of time for RSUs to vest.

The Company maintains the Amended and Restated 2019 Director Fee Plan, the Amended and Restated 2014 Director Fee Plan and the 1994 Director Fee Plan (collectively, the "Director Fee Plans").

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Under the Amended and Restated 2019 Director Fee Plan, non-employee directors (except for the Chairman of the Board) each receive, as an annual retainer fee for fiscal 2024, either cash or shares of the Company's Class A Common Stock with a value equal to $ 90 .

The annual retainer fee for fiscal 2023 paid to the non-employee Chairman of the Board is $ 210 .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SHARE-BASED PAYMENTS, (continued)

annual retainer fee for fiscal 2024 paid to the non-employee Chairman of the Board is $ 210 .

Where the annual retainer fee is provided in shares, each director may elect to be paid these shares on a current basis or have such shares credited to a deferred stock account as phantom stock, with such shares to be paid to the director subsequent to leaving the Board.

The total number of shares of stock that have been authorized to be issued under the Amended and Restated 2019 Director Fee Plan or credited to a deferred stock compensation account for subsequent issuance is 300,000 shares of Common Stock (subject to adjustment upon certain events such as stock dividends or stock splits), following the amendment and restatement of the 2019 Director Fee Plan at the Company's 2023 Annual Shareholder Meeting.

The total number of shares of stock that have been authorized to be issued under the Amended and Restated 2019 Director Fee Plan or credited to a deferred stock compensation account for subsequent issuance is 300,000 shares of Class A Common Stock (subject to adjustment upon certain events such as stock dividends or stock splits), following the amendment and restatement of the 2019 Director Fee Plan at the Company's 2023 Annual Shareholder Meeting.

The value of deferred shares is recorded in other liabilities.

1 unchanged sentence

Additionally, non-employee directors each receive an annual stock-based grant (non-statutory stock options, stock appreciation rights and/or restricted shares or units) with a value of $ 140 for fiscal 2024.

As of September 30, 2023, 336,127 restricted shares and restricted share units have been granted under the Director Fee Plans, 162,898 of which were issued under the 2019 Director Fee Plan.

60,057 restricted share units are unvested at September 30, 2023 under the Director Fee Plans.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

As of September 30, 2024, 377,460 restricted shares and RSUs have been granted under the Director Fee Plans, 204,231 of which were issued under the 2019 Director Fee Plan.

71,549 RSUs are unvested at September 30, 2024 under the Director Fee Plans.

EARNINGS PER SHARE:

The information used to compute earnings (loss) per share attributable to Matthews' common shareholders was as follows:

The information used to compute (loss) earnings per share attributable to Matthews' common shareholders was as follows:

2024 2023 2022

Net income (loss) attributable to Matthews shareholders $ 39,291 $ ( 99,774 ) $ 2,910

Net (loss) income attributable to Matthews shareholders $ ( 59,660 ) $ 39,291 $ ( 99,774 )

Weighted-average shares outstanding (in thousands):

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Dividends declared per common share $ 0.96 $ 0.92 $ 0.88

Anti-dilutive securities excluded from the dilutive calculation were insignificant for the fiscal years ended September 30, 2023 and 2021.

Anti-dilutive securities excluded from the dilutive calculation were insignificant for the fiscal year ended September 30, 2023.

During periods in which the Company incurs a net loss, diluted weighted-average shares outstanding are equal to basic weighted-average shares outstanding because the effect of all equity awards is anti-dilutive.

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Effective January 1, 2014, the Company's principal defined benefit retirement plan ("DB Plan") was closed to new participants.

As of September 30, 2023 and 2022, all of the Company's defined benefit plans are unfunded.

In April 2021, the Committee approved resolutions to freeze all future benefit accruals for all participants in the Company's non-qualified Supplemental Retirement Plan ("SERP") and the defined benefit portion of the Officers Retirement Restoration Plan (“ORRP”), effective April 30, 2021.

In August 2021, the Committee approved the termination of the SERP and the defined benefit portion of the ORRP.

In September 2021, the Company notified SERP and ORRP participants of its intention to fully settle the obligations of the SERP and ORRP in early fiscal 2023.

In August 2021, the Company's Board of Directors approved the freeze of all future benefit accruals for the Company's DB Plan, effective September 30, 2021, and the planned termination of the DB Plan in early fiscal 2022.

At such time, the Company notified all plan participants of the Company's intentions to terminate and fully settle the obligations of the DB Plan early in fiscal 2022.

The freezing of the DB Plan, SERP, and ORRP triggered curtailments, which resulted in the remeasurement of the projected benefit obligations and the immediate recognition of prior service costs in earnings in fiscal 2021, which were previously included within AOCI.

During fiscal 2021, future benefit accruals were frozen for all participants in the Company's DB Plan, non-qualified Supplemental Retirement Plan ("SERP") and the defined benefit portion of the Officers Retirement Restoration Plan ("ORRP").

Additionally, the Company notified plan participants of its intention to terminate and fully settle the obligations of these plans.

In the first quarter of fiscal 2022, the Company terminated its DB Plan and made plan contributions totaling $ 35,706 to fully fund the planned settlement of the DB Plan obligations.

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This amount represents the immediate recognition of the deferred AOCI balances related to the SERP and ORRP.

During fiscal 2023, the remaining funds held in a rabbi trust associated with the SERP were transferred to the Company.

Consequently, these amounts are no longer classified as restricted cash.

As of September 30, 2024 and 2023, all of the Company's remaining defined benefit plans are unfunded.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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Benefit obligation, beginning of year $ 12,896 $ 36,609 $ 12,375 $ 12,813

Acquisitions (1)

Service cost 125 163 55 76

Interest cost 530 497 684 644

Actuarial gain ( 512 ) ( 19,978 ) ( 641 ) ( 5,989 )

Actuarial loss (gain) 1,100 ( 512 ) 777 ( 641 )

Settlement — ( 24,242 ) — —

Exchange loss (gain) 979 ( 3,093 ) — —

Exchange loss 645 979 — —

Benefit payments ( 584 ) ( 598 ) ( 513 ) ( 517 )

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Fair value, beginning of year — — — —

Actual return — 368 — —

Benefit payments ( 584 ) ( 598 ) ( 513 ) ( 517 )

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Funded status ( 14,712 ) ( 12,896 ) ( 13,378 ) ( 12,375 )

Unrecognized actuarial (gain) loss ( 1,518 ) 5,140 ( 5,906 ) ( 5,973 )

Unrecognized prior service (credit) cost — ( 4,815 ) ( 956 ) ( 1,320 )

Unrecognized actuarial gain ( 1,453 ) ( 1,518 ) ( 4,407 ) ( 5,906 )

Unrecognized prior service credit — — ( 591 ) ( 956 )

Net amount recognized $ ( 16,165 ) $ ( 14,414 ) $ ( 18,376 ) $ ( 19,237 )

2 unchanged sentences

Noncurrent benefit liability ( 14,712 ) ( 12,828 ) ( 12,506 ) ( 11,499 )

Accumulated other comprehensive (income) loss ( 1,518 ) 325 ( 6,862 ) ( 7,293 )

Accumulated other comprehensive income ( 1,453 ) ( 1,518 ) ( 4,998 ) ( 6,862 )

Net amount recognized $ ( 16,165 ) $ ( 14,414 ) $ ( 18,376 ) $ ( 19,237 )

Amounts recognized in accumulated

other comprehensive (income) loss:

Net actuarial (gain) loss $ ( 1,518 ) $ 5,140 $ ( 5,906 ) $ ( 5,973 )

Prior service (credit) cost — ( 4,815 ) ( 956 ) ( 1,320 )

other comprehensive income:

Net actuarial gain $ ( 1,453 ) $ ( 1,518 ) $ ( 4,407 ) $ ( 5,906 )

Prior service credit — — ( 591 ) ( 956 )

Net amount recognized $ ( 1,453 ) $ ( 1,518 ) $ ( 4,998 ) $ ( 6,862 )

(1) Fiscal 2022 reflects benefit obligations assumed in connection with the acquisition of OLBRICH and R+S Automotive.

For additional information, see Note 21.

(2) Gains and losses related to changes in assumptions (e.g., discount rate, mortality, etc.), asset, salary and other experience, and curtailments impacted benefit obligations.

(1) Gains and losses related to changes in assumptions (e.g., discount rate, mortality, etc.), salary and other experience impacted benefit obligations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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PENSION AND OTHER POSTRETIREMENT PLANS, (continued)

Based upon actuarial valuations performed as of September 30, 2023 and 2022, the accumulated benefit obligation for the Company's defined benefit pension plans was $ 12,896 and $ 36,609 at September 30, 2023 and 2022, respectively, and the projected benefit obligation for the Company's defined benefit pension plans was $ 12,896 and $ 36,609 at September 30, 2023 and 2022, respectively.

Based upon actuarial valuations performed as of September 30, 2024 and 2023, both the accumulated benefit obligation and the projected benefit obligation for the Company's defined benefit pension plans was $ 14,712 and $ 12,896 at September 30, 2024 and 2023, respectively.

Net periodic pension and other postretirement benefit cost for the plans included the following:

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Amortization:

Prior service cost — ( 152 ) ( 127 ) ( 364 ) ( 364 ) ( 364 )

Prior service cost (credit) — — ( 152 ) ( 364 ) ( 364 ) ( 364 )

Net actuarial (gain) loss * ( 53 ) ( 64 ) 469 ( 722 ) ( 708 ) —

Curtailment gain * — — ( 220 ) — — —

Special termination benefits * — — 315 — — —

Prior-service cost write-offs * — — 261 — — —

Settlement* — 1,271 30,856 — — —

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Benefit payments under the Company's postretirement benefit plan are made from the Company's operating funds.

Contributions made in fiscal 2023 are as follows:

Contributions Pension Other Postretirement

Supplemental retirement plan $ 23,469 $ —

Other retirement plans 1,371 —

Other postretirement plan — 517

The weighted-average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed and also the net periodic benefit cost for the following year.

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Discount rate 3.51 % 4.13 % 4.01 % 4.99 % 5.86 % 5.37 %

Return on plan assets — % — % 3.10 % — — —

Compensation increase — % — % 3.50 % — — —

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

PENSION AND OTHER POSTRETIREMENT PLANS, (continued)

In October 2014, the Society of Actuaries' Retirement Plans Experience Committee ("RPEC") released new mortality tables known as RP-2014.

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The revised assumption uses the most recent RPEC Scale MP mortality improvement table for all years where the RPEC tables are based on finalized data, and the most recently published Social Security Administration Intermediate mortality improvement for subsequent years.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

PENSION AND OTHER POSTRETIREMENT PLANS, (continued)

Benefit payments expected to be paid are as follows:

10 unchanged sentences

The Company also provides a non-qualified deferred compensation plan for certain executives that permits participants to defer an amount of income into the plan during each calendar year.

The expense associated with the contributions made to this plan was $ 1,385 for the fiscal year ended September 30, 2023.

The expense associated with the contributions made to this plan was $ 700 and $ 1,385 for the fiscal years ended September 30, 2024 and 2023, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

7 unchanged sentences

Amounts reclassified from AOCI 23,261 (a)

( 1,242 ) (b)

Net current-period OCI 41,112 ( 48,059 ) 9,495

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Net current-period OCI ( 1,805 )

( 8,106 ) 5,662

Balance, September 30, 2024 $ 4,955 $ ( 174,623 )

28 unchanged sentences

Actuarial gains (losses) 775 772 ( 469 ) Other income (deductions), net

Prior service cost write-off — — ( 261 ) Other income (deductions), net

Settlement losses — ( 1,271 ) ( 30,856 ) Other income (deductions), net

( 135 ) ( 30,809 ) ( 9,539 ) Income before income tax (b)

33 7,548 2,337 Income taxes

$ ( 102 ) $ ( 23,261 ) $ ( 7,202 ) Net income

1,139 ( 135 ) ( 30,809 ) (Loss) income before income taxes (b)

( 289 ) 33 7,548 Income tax benefit (provision)

$ 850 $ ( 102 ) $ ( 23,261 ) Net (loss) income

Cash flow hedges $ 2,679 $ 2,626 $ ( 1,786 ) Interest expense

Net investment hedges 816 1,159 1,645 Interest expense

3,785 ( 141 ) ( 3,186 ) Income before income tax (b)

( 959 ) 36 781 Income taxes

$ 2,826 $ ( 105 ) $ ( 2,405 ) Net income

3,495 3,785 ( 141 ) (Loss) income before income taxes (b)

( 884 ) ( 959 ) 36 Income tax benefit (provision)

$ 2,611 $ 2,826 $ ( 105 ) Net (loss) income

(a) Prior service cost amounts are included in the computation of pension and other postretirement benefit expense, which is reported in both cost of goods sold and selling and administrative expenses.

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Share-based compensation ( 0.7 ) % 3.6 % ( 1.1 ) %

Termination of SERP — % — % 28.6 %

Tax credits ( 7.0 ) % 1.2 % ( 26.6 ) %

Sale of SERP-related investments — % — % 23.8 %

Tax credits (net of withholding taxes) 3.6 % ( 7.0 ) % 1.2 %

Goodwill write-down ( 4.9 ) % — % ( 11.2 ) %

Tax rate differential on net operating loss carryback — % — % ( 21.4 ) %

Nontaxable income 5.0 % ( 7.5 ) % 0.8 %

Utilization of foreign losses with valuation allowance ( 5.6 ) % — % — %

Nondeductible held-for-sale asset write-downs ( 4.0 ) % — % — %

Change in realizability of foreign deferred tax assets ( 30.7 ) % ( 9.5 ) % ( 5.8 ) %

4.2 % 0.6 % ( 2.5 ) %

Effective tax rate 14.4 % 4.3 % 4.2 %

* In Fiscal 2022, "Other" primarily consists of foreign net operating losses that had a full valuation allowance.

The Company's consolidated income taxes for the year ended September 30, 2023 were an expense of $ 1,774 , compared to a benefit of $ 4,391 for fiscal 2022, and an expense of $ 6,375 for fiscal 2021.

The Company's consolidated income taxes for the year ended September 30, 2024 were a benefit of $ 9,997 , compared to an expense of $ 1,774 for fiscal 2023, and a benefit of $ 4,391 for fiscal 2022.

The difference between the Company's consolidated income taxes for fiscal 2024 compared to fiscal 2023 partially resulted from the Company's fiscal 2024 pre-tax consolidated loss position compared to pre-tax consolidated income for fiscal 2023.

The fiscal 2024 tax rate included charges related to changes in the realizability of foreign deferred tax assets.

These changes included both current year foreign net operating losses requiring a full valuation allowance as well as other changes in realizability of certain foreign net operating losses from prior years.

The fiscal 2024 consolidated loss before income taxes also reflected a goodwill write-down and write-down of certain net assets held-for-sale that were non-deductible for tax purposes.

Additionally, the fiscal 2024 tax rate benefited from research and development and foreign tax credits.

The fiscal 2023 effective tax rate benefited from research and development and foreign tax credits, and changes in realizability of foreign deferred tax assets due to the utilization of foreign tax net operating losses with a valuation allowance.

The fiscal 2023 effective tax rate was negatively impacted by share-based compensation.

The difference between the Company's consolidated income taxes for fiscal 2023 compared to fiscal 2022 partially resulted from fiscal 2023 having consolidated income before income taxes compared to fiscal 2022 having a consolidated loss before income taxes.

4 unchanged sentences

The fiscal 2022 effective tax rate was negatively impacted by foreign net operating losses requiring a full valuation allowance.

The difference between the Company's consolidated income taxes for fiscal 2022 compared to fiscal 2021 partially resulted from fiscal 2022 having a consolidated loss before income taxes compared to fiscal 2021 having consolidated income before income taxes.

The fiscal 2022 consolidated loss reflected a goodwill write-down recorded in the fourth quarter of fiscal 2022 that was primarily non-deductible.

The Company’s fiscal 2021 effective tax rate benefited from research and development and foreign tax credits as well as the reduction of uncertain tax positions due to the expiration of the statute of limitations in certain jurisdictions, the completion of a state tax audit, and the tax benefit of the NOL carryback.

The fiscal 2021 effective tax rate was negatively affected by the termination of the Company’s SERP, which resulted in certain expenses that are nondeductible for tax purposes.

The Company's foreign subsidiaries had income before income taxes for the year ended September 30, 2023 of approximately $ 43,090 , loss before income taxes for the year ended September 30, 2022 of approximately $ 47,653 and income before income taxes for the year ended September 30, 2021 of approximately $ 6,685 .

The Company's foreign subsidiaries had losses before income taxes for the year ended September 30, 2024 of approximately $ 39,069 , income before income taxes for the year ended September 30, 2023 of approximately $ 43,090 and losses before income taxes for the year ended September 30, 2022 of approximately $ 47,653 .

At September 30, 2024, undistributed earnings of foreign subsidiaries for which deferred income taxes have not been provided approximated $ 411,885 .

Deferred income taxes have not been provided on undistributed earnings of foreign subsidiaries since they have either been previously taxed, or are now exempt from tax, under the U.S.

Tax Cuts and Jobs Act, or such earnings are considered to be reinvested indefinitely in foreign operations.

At September 30, 2023, undistributed earnings of foreign subsidiaries for which deferred income taxes have not been provided approximated $ 368,306 .

A determination of the deferred tax liability to be recorded if the earnings were not permanently reinvested is not practicable.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

9 unchanged sentences

Research and development capitalization 18,299 11,028

Operating lease liability 15,833 18,795

Interest carryforward 10,796 2,017

Other 6,057 999

7 unchanged sentences

Revenue recognized over time ( 27,467 ) ( 21,226 )

Operating lease right-of-use assets ( 15,282 ) ( 18,153 )

Other ( 843 ) ( 5,644 )

16 unchanged sentences

It is reasonably possible that the amount of unrecognized tax benefits could decrease by approximately $ 2,815 in the next 12 months primarily due to the completion of audits and the expiration of the statute of limitation related to specific tax positions.

The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes.

Total penalties and interest accrued were $ 730 and $ 876 at September 30, 2023 and 2022, respectively.

These accruals may potentially be applicable in the event of an unfavorable outcome of uncertain tax positions.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

1 unchanged sentence

INCOME TAXES, (continued)

The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes.

Total penalties and interest accrued were $ 588 and $ 730 at September 30, 2024 and 2023, respectively.

These accruals may potentially be applicable in the event of an unfavorable outcome of uncertain tax positions.

The Company is currently under examination in several tax jurisdictions and remains subject to examination until the statute of limitation expires for those tax jurisdictions.

8 unchanged sentences

COMMITMENTS AND CONTINGENT LIABILITIES:

The Company is party to various legal proceedings, the eventual outcome of which are not predictable.

Although the ultimate disposition of these proceedings is not presently determinable, management is of the opinion that they should not result in liabilities in an amount which would materially affect the Company's consolidated financial position, results of operations or cash flows.

In the normal course of business, the Company may provide certain customers with performance guarantees, and at times letters of credit or surety bonds.

5 unchanged sentences

The aggregate commitment for salaries under these agreements at September 30, 2024 was $ 10,310 .

The Company is party to various legal proceedings and claims arising in the ordinary course of business, the eventual outcome of which are not predictable.

Although the ultimate disposition of these ordinary course proceedings is not presently determinable, management is of the opinion that they should not result in liabilities in an amount which would materially affect the Company's consolidated financial position, results of operations or cash flows.

In addition to these ordinary course legal proceedings, the Company is involved in the following legal proceeding.

On October 7, 2024, the United States District Court for the Northern District of California granted the Company’s motion to compel arbitration in response to a complaint filed by Tesla on June 14, 2024 against the Company in the Northern District of California, Civil Action No.

5:24-cv-03615 (N.D.

Cal.), which alleged trade secret misappropriation under the Defend Trade Secrets Act (the "DTSA") and California's Uniform Trade Secrets Act (the "CUTSA"), breach of contract and unfair business practices.

As a result of the Court’s favorable ruling, the matter filed by Tesla has been effectively stayed pending arbitration.

The Company maintains the claims vaguely stated in the complaint are without merit and intends to vigorously defend itself against the allegations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SUPPLEMENTAL CASH FLOW INFORMATION:

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Inventories 27,019 ( 23,990 ) ( 23,459 )

Contract assets ( 15,304 ) ( 23,465 ) ( 19,509 )

Other current assets 8,483 ( 3,259 ) 3,739

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Accrued income taxes ( 4,834 ) 3,343 5,745

Accrued rebates 144 296 1,265

Contract liabilities ( 9,426 ) 4,971 12,238

Other current liabilities ( 18,112 ) ( 9,993 ) ( 21,119 )

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Net change $ 14,696 $ ( 35,503 ) $ 29,590

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SEGMENT INFORMATION

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The Memorialization segment consists primarily of bronze and granite memorials and other memorialization products, caskets, cremation-related products, and cremation and incineration equipment primarily for the cemetery and funeral home industries.

The Industrial Technologies segment includes the design, manufacturing, service and distribution of high-tech custom energy storage solutions;

The Industrial Technologies segment includes the design, manufacturing, service and sales of high-tech custom energy storage solutions;

product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products;

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Adjusted EBITDA is defined by the Company as earnings before interest, income taxes, depreciation, amortization and certain non-cash and/or non-recurring items that do not contribute directly to management’s evaluation of its operating results.

These items include stock-based compensation, the non-service portion of pension and postretirement expense, acquisition and divestiture costs, ERP integration costs, and strategic initiatives and other charges.

These items include stock-based compensation, the non-service portion of pension and postretirement expense, acquisition and divestiture costs, enterprise resource planning ("ERP") integration costs, and strategic initiatives and other charges.

This presentation is consistent with how the Company's chief operating decision maker (the “CODM”) evaluates the results of operations and makes strategic decisions about the business.

For these reasons, the Company believes that adjusted EBITDA represents the most relevant measure of segment profit and loss.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SEGMENT INFORMATION, (continued)

In addition, the CODM manages and evaluates the operating performance of the segments, as described above, on a pre-corporate cost allocation basis.

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Long-lived assets include property, plant and equipment (net of accumulated depreciation), goodwill, and other intangible assets (net of accumulated amortization).

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

SEGMENT INFORMATION, (continued)

Information about the Company's segments follows:

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Defined benefit plan termination related items (5)

Asset write-downs, net (6)

— ( 10,050 ) —

Goodwill write-downs (7)

Goodwill and asset write-downs (6)

( 33,574 ) — ( 92,504 )

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Net loss attributable to noncontrolling interests — ( 155 ) ( 54 )

Income (loss) before income taxes 40,910 ( 104,219 ) 9,233

Income tax (provision) benefit ( 1,774 ) 4,391 ( 6,375 )

Net income (loss) $ 39,136 $ ( 99,828 ) $ 2,858

(Loss) income before income taxes ( 69,657 ) 40,910 ( 104,219 )

Income tax benefit (provision) 9,997 ( 1,774 ) 4,391

Net (loss) income $ ( 59,660 ) $ 39,136 $ ( 99,828 )

(1) Includes certain non-recurring costs associated with recent acquisition and divestiture activity, and also includes a gain of $ 1,827 in fiscal year 2023 related to the divestiture of a business in the Industrial Technologies segment.

(2) Includes certain non-recurring costs associated with productivity and cost-reduction initiatives intended to result in improved operating performance, profitability and working capital levels and costs associated with global ERP system integration efforts, net of loss recoveries of $ 2,154 in fiscal year 2023 related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.

(2) Includes certain non-recurring costs associated with commercial, operational and cost-reduction initiatives and costs associated with global ERP system integration efforts.

Fiscal 2024 also includes legal costs related to an ongoing dispute with Tesla, which totaled $ 12,399 (See Note 19, "Commitments and Contingent Liabilities").

Fiscal 2023 includes loss recoveries totaling $ 2,154 which were related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.

(3) Includes certain non-recurring direct incremental costs (such as costs for purchases of computer peripherals and devices to facilitate working-from-home, additional personal protective equipment and cleaning supplies and services, etc.) incurred in response to COVID-19.

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(5) Represents items associated with the termination of the Company's DB Plan, supplemental retirement plan and the defined benefit portion of the officers retirement restoration plan.

(6) Represents asset write-downs, net of recoveries within the SGK Brand Solutions segment (see Note 23, "Asset Write-Downs").

(7) Represents goodwill write-downs within the SGK Brand Solutions segment (see Note 22, "Goodwill and Other Intangible Assets").

(6) Fiscal 2024 includes goodwill write-downs within the Industrial Technologies segment of $ 16,727 (see Note 23, "Goodwill and Other Intangible Assets"), asset write-downs within the Memorialization segment of $ 13,716 (see Note 24, "Asset Write-Downs"), and investment write-downs within Corporate and Non-operating of $ 3,131 (see Note 8, "Investments").

Fiscal 2022 includes goodwill write-downs within the SGK Brand Solutions segment of $ 82,454 (see Note 23, "Goodwill and Other Intangible Assets"), and asset write-downs net of recoveries within the SGK Brand Solutions segment of $ 10,050 (see Note 24, "Asset Write-Downs").

(7) Non-service pension and postretirement expense includes interest cost, expected return on plan assets, amortization of actuarial gains and losses, curtailment gains and losses, and settlement gains and losses.

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** Acquisition and divestiture costs, ERP integration costs, and strategic initiatives and other charges were $ 3,514 , $ 1,002 , and $ 3,517 for the Memorialization segment, $ 54,357 , $ 4,108 , and $ 5,631 for the Industrial Technologies segment, $ 3,001 , $ 10,905 , and $ 19,359 for the SGK Brand Solutions segment, and $ 10,290 , $ 3,201 , and $ 7,451 for Corporate and Non-Operating, for the fiscal years ended September 30, 2024, 2023, and 2022, respectively.

*** Non-recurring/incremental COVID-19 costs were $ 1,314 , and $ 3,646 for the Memorialization segment, $ 6 , and $ 38 for the Industrial Technologies segment, $ 1,199 , and $ 1,539 for the SGK Brand Solutions segment, and $ 466 , and $ 89 for Corporate and Non-Operating, for the fiscal years ended September 30, 2022, and 2021 respectively.

*** Non-recurring/incremental COVID-19 costs were $ 1,314 for the Memorialization segment, $ 6 for the Industrial Technologies segment, $ 1,199 for the SGK Brand Solutions segment, and $ 466 for Corporate and Non-Operating, for the fiscal year ended September 30, 2022.

† Strategic initiatives and other charges includes charges for exit and disposal activities (including severance and other employee termination benefits) totaling $ 45,705 , $ 13,210 and $ 14,596 in fiscal years 2024, 2023 and 2022, respectively.

Fiscal 2024 amounts totaling $ 32,526 , $ 1,379 and $ 11,800 were presented in cost of sales, selling expense, and administrative expense, respectively.

Fiscal 2023 amounts totaling $ 9,028 , $ 1,925 and $ 2,257 were presented in cost of sales, selling expense, and administrative expense, respectively.

Fiscal 2022 amounts totaling $ 1,777 , $ 267 and $ 12,552 were presented in cost of sales, selling expense, and administrative expense, respectively.

Accrued severance and other employee termination benefits totaled $ 42,245 and $ 7,321 as of September 30, 2024 and 2023, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

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ACQUISITIONS AND DIVESTITURES:

In January 2024, the Company completed a small acquisition within the Memorialization segment for a purchase price of $ 5,825 (net of holdbacks and other adjustments, including working capital).

The Company finalized the allocation of the purchase price in the fourth quarter of fiscal 2024, resulting in no significant adjustments.

In September 2023, the Company completed a small divestiture within the Industrial Technologies segment.

2 unchanged sentences

In March 2023, the Company purchased the remaining ownership interest in a non-consolidated Industrial Technologies subsidiary for $ 4,759 (net of cash acquired and holdbacks).

The preliminary purchase price allocation was not finalized as of September 30, 2023 and remains subject to change as the Company obtains additional information related to working capital and other assets and liabilities.

The Company finalized the allocation of the purchase price in the first quarter of fiscal 2024, resulting in no significant adjustments.

In February 2023, the Company acquired Eagle Granite Company ("Eagle") within the Memorialization segment for a total purchase price of $ 18,384 , consisting of cash of $ 8,650 (net of cash acquired) and a deferred purchase price amount of $ 9,734 , which is scheduled to be paid to the seller two years from the acquisition date.

In addition, the Company recorded a liability of approximately $ 1,030 for potential future contingent consideration related to certain earnout provisions, which, if owed, is scheduled to be paid to the seller four years from the acquisition date.

In addition, the Company has recorded a liability of approximately $ 3,800 for potential future contingent consideration related to certain earnout provisions, which, if owed, is scheduled to be paid to the seller four years from the acquisition date.

Eagle serves cemeteries and monument companies with a full complement of granite memorialization products.

The Company finalized the allocation of the purchase price in the fourth quarter of fiscal 2023, resulting in an immaterial adjustment to certain working capital accounts.

The Company finalized the allocation of the purchase price in the first quarter of fiscal 2024, resulting in adjustments to certain liability accounts.

During the first fiscal quarter of 2023, the Company completed small acquisitions within the SGK Brand Solutions segment for a combined purchase price of $ 1,932 (net of cash acquired and holdbacks).

The Company finalized the purchase price allocations in the fourth quarter of fiscal 2023, resulting in an immaterial adjustment to certain tax accounts.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

ACQUISITIONS AND DIVESTITURES, (continued)

In August 2022, the Company acquired German-based engineering firms OLBRICH and R+S Automotive for a purchase price of approximately € 43,700 ($ 44,469 ) (net of cash acquired) within the Industrial Technologies segment.

3 unchanged sentences

The Company finalized the allocation of the purchase price in the fourth quarter of fiscal 2023, resulting in an immaterial adjustment to certain working capital, tax, and other accounts.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

ACQUISITIONS AND DIVESTITURES, (continued)

In April 2021, the Company completed a small acquisition in the hydrogen fuel cell industry within the Industrial Technologies segment for a purchase price of $ 2,523 (net of cash acquired and holdback amounts).

The Company finalized the allocation of the purchase price in the first quarter of fiscal 2022, resulting in an immaterial adjustment to certain working capital accounts.

In January 2021, the Company acquired a memorialization business that produces and distributes cemetery products for a purchase price of $ 13,100 .

The Company finalized the allocation of the purchase price in the fourth quarter of fiscal 2021, resulting in an immaterial adjustment to certain working capital accounts.

GOODWILL AND OTHER INTANGIBLE ASSETS:

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Additions during period 2,322 6,757 2,100 11,179

Divestiture during period — ( 2,525 ) — ( 2,525 )

Translation and other adjustments 1,911 3,819 8,304 14,034

Goodwill write-down — — ( 82,454 ) ( 82,454 )

Net goodwill at September 30, 2023 366,015 115,073 217,021 698,109

Additions during period 2,551 — — 2,551

Divestiture during period — ( 2,525 ) — ( 2,525 )

Translation and other adjustments 4,578 1,199 7,413 13,190

Goodwill write-down — ( 16,727 ) — ( 16,727 )

Net goodwill at September 30, 2024 $ 373,144 $ 99,545 $ 224,434 $ 697,123

The net goodwill balances at September 30, 2023 and 2022 included $ 261,186 of accumulated impairment losses.

Accumulated impairment losses at September 30, 2023 and 2022 were $ 5,000 , $ 23,946 , and $ 232,240 for the Memorialization, Industrial Technologies and SGK Brand Solutions segments, respectively.

In fiscal 2023, the additions reflect the acquisition of Eagle Granite Company within the Memorialization segment, the purchase of the remaining ownership interest in an Industrial Technologies subsidiary, and small acquisitions within the SGK Brand Solutions segment.

The net goodwill balances at September 30, 2024 and 2023 included $ 277,913 and $ 261,186 of accumulated impairment losses, respectively.

Accumulated impairment losses at September 30, 2024 were $ 5,000 , $ 40,673 , and $ 232,240 for the Memorialization, Industrial Technologies and SGK Brand Solutions segments, respectively.

Accumulated impairment losses at September 30, 2023 were $ 5,000 , $ 23,946 , and $ 232,240 for the Memorialization, Industrial Technologies and SGK Brand Solutions segments, respectively.

In fiscal 2024, the additions reflect the acquisition of a small business within the Memorialization segment.

The Company performed its annual impairment review of goodwill and indefinite-lived intangible assets in the second quarter of fiscal 2024 (January 1, 2024) and determined that the estimated fair values for all goodwill reporting units exceeded their carrying values, therefore no impairment charges were necessary.

The estimated fair value of the Company's SGK Brand Solutions reporting unit exceeded the carrying value (expressed as a percentage of carrying value) by approximately 9 % as of January 1, 2023.

In light of the limited excess fair value over carrying value and further declines experienced by the SGK Brand Solutions reporting unit, management determined that a triggering event occurred during the fourth quarter of fiscal 2023, resulting in an interim assessment of goodwill for the reporting unit, as of September 1, 2023.

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GOODWILL AND OTHER INTANGIBLE ASSETS, (continued)

In fiscal 2022, the additions to Industrial Technologies goodwill reflects the acquisition of OLBRICH and R+S Automotive.

The Company's Surfaces and Engineering reporting unit experienced declines during the fourth quarter of fiscal 2024, primarily related to the Company's recently acquired (August 2022) Olbrich GmbH business.

The Company determined that a triggering event occurred during the fourth quarter of fiscal 2024, resulting in a re-evaluation of the goodwill for the Surfaces and Engineering reporting unit as of September 1, 2024.

As a result of this interim assessment, the Company recorded a goodwill write-down totaling $ 16,727 during the fiscal 2024 fourth quarter, reducing the amount of goodwill for this reporting unit to zero.

The fair value for the reporting unit was determined using level 3 inputs (including estimates of revenue growth, EBITDA contribution and the discount rates) and the income approach valuation methodology which utilizes estimated discounted cash flows of the reporting unit.

In fiscal 2022, in its assessment of the potential impacts of weakened economic conditions (particularly in Europe), increases in the cost of certain materials, labor, and other inflation-related pressures, and unfavorable changes in foreign exchange rates on the estimated future earnings and cash flows for the SGK Brand Solutions reporting unit, and in light of the limited excess fair value over carrying value for this reporting unit, management determined a triggering event occurred, resulting in a re-evaluation of goodwill for the reporting unit, as of September 1, 2022.

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$ 579,261 $ ( 418,783 ) $ 160,478

The net change in intangible assets during fiscal 2023 included the impact of foreign currency fluctuations during the period, additional amortization, additions related to the Eagle acquisition, and disposals related to a small divestiture within the Industrial Technologies segment.

The net change in intangible assets during fiscal 2024 included the impact of foreign currency fluctuations during the period, additional amortization, and additions related to a small acquisition within the Memorialization segment.

Amortization expense on intangible assets was $ 37,023 , $ 42,068 , and $ 57,084 in fiscal 2024, 2023 and 2022, respectively.

Fiscal year amortization expense is estimated to be approximately $ 21,249 in 2025, $ 14,171 in 2026, $ 13,068 in 2027, $ 10,995 in 2028 and $ 9,144 in 2029.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Dollar amounts in thousands, except per share data)

ASSET WRITE-DOWNS:

During the fourth quarter of fiscal 2024, the Company recognized a non-cash impairment charge of $ 13,716 for the full write-down of certain net assets held-for-sale within the Memorialization segment.

The held-for-sale adjustment included a $ 6,844 provision for certain amounts included in AOCI within currency translation adjustment.

This write-down was recorded as a component of administrative expenses for the year ended September 30, 2024.

The Company has certain operations in Russia within its SGK Brand Solutions segment.

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(1) Amounts determined not to be collectible (including direct write-offs), net of recoveries.

Description Balance at Beginning of Period Provision (Credited) Charged To Expense (1, 3)

Description Balance at Beginning of Period Provision Charged (Credited) To Expense (1, 3)

Allowance Changes Other (Deductions) Additions (2,4)

7 unchanged sentences

(1) Amounts relate primarily to adjustments in net operating loss carryforwards which are precluded from use.

(2) Consists principally of adjustments related to foreign exchange.

(2) Fiscal 2023 and 2022 consists principally of adjustments related to foreign exchange.

(3) Fiscal 2024 amount is comprised of a $ 2,032 benefit related to the release of valuation allowance, and a $ 26,184 expense primarily related to adjustments in net operating loss carryforwards which are precluded from use.

Fiscal 2022 amount is comprised of a $ 5,004 benefit related to non-survivability of deferred tax assets with full valuation allowance due to entity dissolution and a $ 3,704 expense primarily related to adjustments in net operating loss carryforwards which are precluded from use.

(4) Fiscal 2024 amount is comprised of a $ 2,802 decrease related to non-survivability of deferred tax assets with a full valuation allowance due to held-for-sale asset write-downs, and a $ 1,606 addition related to foreign exchange.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

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-K

Item 8. Financial Statements and Supplementary Data