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Item 1. Financial Statements

2026-05-01 compared with 2026-02-04 · 470 added, 234 removed, 705 unchanged (50% of the section changed)

3 unchanged sentences

(Dollar amounts in thousands)

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Current assets:

42 unchanged sentences

Three Months Ended

March 31, Six Months Ended

2026 2025 2026 2025

Sales $ 258,619 $ 427,629 $ 543,382 $ 829,471

4 unchanged sentences

Intangible amortization ( 2,674 ) ( 4,280 ) ( 5,640 ) ( 12,888 )

Gain on divestitures, net 113,209 —

Operating profit 97,524 5,674

Gain (loss) on divestitures, net ( 3,945 ) ( 2,072 ) 109,264 ( 2,072 )

Operating (loss) profit ( 3,175 ) 5,948 94,349 11,622

Interest expense ( 10,042 ) ( 15,865 ) ( 24,675 ) ( 31,547 )

Loss on debt extinguishment ( 16,343 ) — ( 16,343 ) —

Other income (deductions), net 1,509 ( 1,727 ) 3,036 2,451

Income (loss) before income taxes 84,418 ( 5,830 )

Income tax (provision) benefit ( 40,789 ) 2,358

Net income (loss) $ 43,629 $ ( 3,472 )

(Loss) income before income taxes ( 28,051 ) ( 11,644 ) 56,367 ( 17,474 )

Income tax benefit (provision) 6,217 2,728 ( 34,572 ) 5,086

Net (loss) income $ ( 21,834 ) $ ( 8,916 ) $ 21,795 $ ( 12,388 )

Earnings (loss) per share:

5 unchanged sentences

(Dollar amounts in thousands)

Three Months Ended December 31,

Net income (loss):

Three Months Ended March 31,

$ ( 21,834 ) $ ( 8,916 )

2 unchanged sentences

Pension plans and other postretirement benefits ( 258 ) ( 69 )

Unrecognized (loss) gain on cash flow hedges:

Unrecognized gain (loss) on cash flow hedges:

Net change from periodic revaluation 868 ( 1,778 )

Net amount reclassified to earnings 17 ( 188 )

Net change in unrecognized (loss) gain on cash flow hedges ( 196 ) 2,215

Net change in unrecognized gain (loss) on cash flow hedges 885 ( 1,966 )

OCI, net of tax ( 5,042 ) 6,317

Comprehensive loss $ ( 26,876 ) $ ( 2,599 )

Six Months Ended March 31,

Net income (loss):

$ 21,795 $ ( 12,388 )

OCI, net of tax:

Foreign currency translation adjustment 23,670 ( 6,259 )

Pension plans and other postretirement benefits ( 1,595 ) ( 422 )

Unrecognized gain (loss) on cash flow hedges:

Net change from periodic revaluation 821 787

Net amount reclassified to earnings ( 132 ) ( 538 )

Net change in unrecognized gain on cash flow hedges 689 249

OCI, net of tax 22,764 ( 6,432 )

Comprehensive income (loss) $ 44,559 $ ( 18,820 )

2 unchanged sentences

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

for the three months ended December 31, 2025 and 2024 (Unaudited)

for the three and six months ended March 31, 2026 and 2025 (Unaudited)

(Dollar amounts in thousands, except per share data)

18 unchanged sentences

December 31, 2025 $ 36,334 $ 139,979 $ 600,502 $ ( 50,204 ) $ ( 183,395 ) $ 543,216

Net loss — — ( 21,834 ) — — ( 21,834 )

Minimum pension liability — — — ( 258 ) — ( 258 )

Translation adjustment — — — ( 5,669 ) — ( 5,669 )

Fair value of cash flow hedges — — — 885 — 885

Total comprehensive loss ( 26,876 )

Stock-based compensation — 5,136 — — — 5,136

Purchase of 22,953 shares of treasury stock

— — — — ( 535 ) ( 535 )

Issuance of 99,310 shares of treasury stock

— ( 3,426 ) — — 3,426 —

Dividends — — ( 8,722 ) — — ( 8,722 )

March 31, 2026 $ 36,334 $ 141,689 $ 569,946 $ ( 55,246 ) $ ( 180,504 ) $ 512,219

MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY, Continued

for the three and six months ended March 31, 2026 and 2025 (Unaudited)

(Dollar amounts in thousands, except per share data)

Shareholders' Equity

18 unchanged sentences

December 31, 2024 $ 36,334 $ 144,588 $ 611,358 $ ( 181,491 ) $ ( 197,381 ) $ 48 $ 413,456

Net loss — — ( 8,916 ) — — — ( 8,916 )

Minimum pension liability — — — ( 69 ) — — ( 69 )

Translation adjustment — — — 8,352 — — 8,352

Fair value of cash flow hedges — — — ( 1,966 ) — — ( 1,966 )

Total comprehensive loss ( 2,599 )

Stock-based compensation — 6,018 — — — — 6,018

Purchase of 5,866 shares of treasury stock

— — — — ( 151 ) — ( 151 )

Issuance of 45,803 shares of treasury stock

— ( 1,684 ) — — 1,684 — —

Dividends — — ( 8,484 ) — — — ( 8,484 )

March 31, 2025 $ 36,334 $ 148,922 $ 593,958 $ ( 175,174 ) $ ( 195,848 ) $ 48 $ 408,240

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

2 unchanged sentences

(Dollar amounts in thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

5 unchanged sentences

Gain on sale of assets, net ( 860 ) ( 9,834 )

Gain on divestitures, net ( 113,209 ) —

Equity and other investment losses (gains) 983 ( 24 )

(Gain) loss on divestitures, net ( 109,264 ) 2,072

Loss on debt extinguishment 16,343 —

Equity and other investment losses 8,934 311

Changes in working capital items ( 37,955 ) ( 43,362 )

7 unchanged sentences

Proceeds from sale of assets 3,506 14,608

Proceeds from sale of investments 3,000 —

Proceeds from divestitures 243,397 2,049

Other investing activities, net ( 420 ) ( 63 )

Net cash provided by investing activities 237,443 1,436

Net cash provided by (used in) investing activities 239,659 ( 3,895 )

Cash flows from financing activities:

3 unchanged sentences

Dividends ( 17,535 ) ( 17,047 )

Proceeds from net investment hedges — 14,990

Acquisition holdback and deferred purchase price payments ( 225 ) ( 10,184 )

Payment of debt redemption premium ( 12,939 ) —

Payment of debt issuance costs ( 1,576 ) —

Net cash (used in) provided by financing activities ( 168,399 ) 33,551

Effect of exchange rate changes on cash ( 175 ) ( 1,545 )

Net change in cash and cash equivalents including balances classified as assets held-for-sale 3,655 9,430

Net change in cash and cash equivalents classified as assets held-for-sale — ( 10,000 )

Net change in cash and cash equivalents 3,655 ( 570 )

4 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

December 31, 2025

March 31, 2026

(Dollar amounts in thousands, except per share data)

4 unchanged sentences

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 product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions.

Industrial Technologies includes product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions including coating and converting lines.

The segment historically provided warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products, and coating and converting lines for the packaging, pharma, foil, décor and tissue industries.

4 unchanged sentences

In December 2025, the Company sold its European roto-gravure packaging and tooling and flexographic print businesses to the local management of those businesses in exchange for cash and other consideration.

On December 31, 2025, the Company sold its warehouse automation business for cash and other consideration.

Following the completion of these transactions, the Company's Industrial Technologies segment consists of product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions, and the Company's Brand Solutions segment consists of its 40 % ownership interest in Propelis.

On December 31, 2025, the Company sold its warehouse automation business for cash consideration.

Following the completion of these transactions, the Company's Industrial Technologies segment consists of product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions including coating and converting lines, and the Company's Brand Solutions segment consists of its 40 % ownership interest in Propelis.

See Notes 7, "Investments" and 16, "Acquisitions and Divestitures" for further information.

As of December 31, 2025, the Company had facilities in North America, Europe, Asia, Australia, and Central America.

As of March 31, 2026, the Company had facilities in North America, Europe, Asia, Australia, and Central America.

Basis of Presentation

3 unchanged sentences

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included.

Operating results for the three months ended December 31, 2025 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2026.

Operating results for the three and six months ended March 31, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2026.

For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2025.

6 unchanged sentences

The Company recognizes its portion of the earnings or losses for its equity-method investment in Propelis on a three-month lag to ensure consistency and timely filing of the Company's financial statements.

Consequently, in fiscal 2026, the Company's portion of earnings for its equity-method investment in Propelis includes the months of July, August and September 2025.

Consequently, for the three months ended March 31, 2026, the Company's portion of earnings (losses) for its equity-method investment in Propelis includes the months from October 2025 through December 2025.

For the six months ended March 31, 2026, the Company's portion of earnings (losses) for its equity-method investment in Propelis includes the months from July 2025 through December 2025.

See Note 7, "Investments" for further information with respect to the equity-method investment in Propelis.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Basis of Presentation (continued)

The Company applies highly inflationary accounting for subsidiaries when the cumulative inflation rate for a three-year period meets or exceeds 100 percent.

2 unchanged sentences

dollar) and exchange

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Basis of Presentation (continued)

gains and losses from the remeasurement of monetary assets and liabilities were reflected in current earnings, rather than accumulated other comprehensive loss on the Consolidated Balance Sheets .

As of September 30, 2025, the Company had net monetary assets related to its Turkish subsidiaries of $ 2,109 .

Exchange losses related to highly inflationary accounting totaled $ 16 and $ 191 for the three months ended December 31, 2025 and December 31, 2024, respectively.

Exchange losses related to highly inflationary accounting totaled $ 16 for the six months ended March 31, 2026, and $ 520 and $ 711 for the three and six months ended March 31, 2025, respectively.

Such amounts were included in the Consolidated Statements of Income within other income (deductions), net.

1 unchanged sentence

Actual results could differ from those estimates.

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.

New Accounting Pronouncements:

24 unchanged sentences

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Basis of Presentation (continued)

In December 2023, the FASB issued ASU No.

2 unchanged sentences

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Basis of Presentation (continued)

In October 2023, the FASB issued ASU No.

10 unchanged sentences

The Company disaggregates revenue from contracts with customers by geography, as it believes geographic regions best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

Disaggregated sales by segment and region for the three months ended December 31, 2025 and 2024 were as follows:

Disaggregated sales by segment and region for the three and six months ended March 31, 2026 and 2025 were as follows:

Memorialization Industrial Technologies Brand Solutions Consolidated

Three Months Ended December 31, Three Months Ended December 31, Three Months Ended December 31, Three Months Ended December 31,

Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31,

2026 2025 2026 2025 2026 2025 2026 2025

6 unchanged sentences

Total Sales $ 215,257 $ 205,620 $ 43,362 $ 80,835 $ — $ 141,174 $ 258,619 $ 427,629

Memorialization Industrial Technologies Brand Solutions Consolidated

Six Months Ended March 31, Six Months Ended March 31, Six Months Ended March 31, Six Months Ended March 31,

2026 2025 2026 2025 2026 2025 2026 2025

North America $ 400,958 $ 378,376 $ 43,046 $ 62,310 $ — $ 134,179 $ 444,004 $ 574,865

Central and South America (1)

— — — — — 2,638 — 2,638

Europe 12,166 11,957 66,256 96,386 6,904 99,817 85,326 208,160

Australia 6,308 5,773 — — — 4,605 6,308 10,378

Asia — — 3,075 2,672 4,669 30,758 7,744 33,430

Total Sales $ 419,432 $ 396,106 $ 112,377 $ 161,368 $ 11,573 $ 271,997 $ 543,382 $ 829,471

(1) Following the contribution of the SGK Business to Propelis in the third quarter of fiscal 2025, the Company no longer had operations in South America.

Revenue recognized using the over time method accounted for approximately 11 % and 12 % of revenue for the three months ended December 31, 2025 and 2024, respectively.

As of December 31, 2025 and September 30, 2025, the Company had net contract assets for projects recognized using the over time method totaling $ 109,834 and $ 99,700 , respectively, which primarily represent unbilled revenues, net of deferred revenues related to customer deposits and progress billings.

Net contract assets at December 31, 2025 and September 30, 2025 predominantly related to ongoing projects with Tesla, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Revenue Recognition (continued)

Revenue recognized using the over time method accounted for approximately 2 % and 13 % of revenue for the three months ended March 31, 2026 and 2025, respectively and 6 % and 13 % of revenue for the six months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026 and September 30, 2025, the Company had net contract assets for projects recognized using the over time method totaling $ 98,547 and $ 99,700 , respectively, which primarily represent unbilled revenues, net of deferred revenues related to customer deposits and progress billings.

Net contract assets at March 31, 2026 and September 30, 2025 predominantly related to ongoing projects with Tesla, Inc.

Unbilled revenues are generally expected to be invoiced upon the attainment of certain contractual conditions and milestones.

1 unchanged sentence

Customer delays within the energy storage business have impacted the timing of projects, and consequently, have resulted in invoicing delays for this business.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Fair Value Measurements

5 unchanged sentences

The fair values of the Company's assets and liabilities measured on a recurring basis are categorized as follows:

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

8 unchanged sentences

(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) Derivative amounts at both December 31, 2025 and September 30, 2025 reflect $ 40,186 of partial advance payments received from the counterparties to certain cross-currency swaps.

(2) Derivative amounts at both March 31, 2026 and September 30, 2025 reflect $ 40,186 of partial advance payments received from the counterparties to certain cross-currency swaps.

See Note 9, "Derivatives and Hedging Activities" for further details.

The carrying values for other financial assets and liabilities approximated fair value at December 31, 2025 and September 30, 2025.

The carrying values for other financial assets and liabilities approximated fair value at March 31, 2026 and September 30, 2025.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Allowance for Credit Losses

The following table summarizes the activity for the accounts receivable allowance for credit losses for the three months ended December 31, 2025 and 2024.

Three Months Ended December 31,

The following table summarizes the activity for the accounts receivable allowance for credit losses for the six months ended March 31, 2026 and 2025.

Six Months Ended March 31,

Balance at beginning of period $ 13,481 $ 12,055

4 unchanged sentences

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Inventories consisted of the following:

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Raw materials $ 59,436 $ 60,585

3 unchanged sentences

Non-current investments consisted of the following:

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Equity and fixed income mutual funds $ 575 $ 859

8 unchanged sentences

Consequently, for the three months ended December 31, 2025, the Company's portion of earnings (losses) for its equity-method investment in Propelis includes the months of July, August and September 2025.

For the three months ended December 31, 2025, the Company recognized $ 2,298 of equity-method losses for its equity-method investment in Propelis, which has been recorded as a component of administrative expense.

Equity-method losses for the three months ended December 31, 2025 included $ 1,106 of losses, representing the Company's portion of the investee's losses, and $ 1,192 of additional expense, reflecting the amortization of the Company's portion of the basis difference of the amortizable assets contributed from SGS & Co.

("SGS") to Propelis.

The Company also recognized $ 1,250 of paid-in-kind interest income for the three months ended December 31, 2025 related to the Company's preferred equity investment in Propelis, which was included as a component of other income (deductions), net.

For the six months ended March 31, 2026, the Company's portion of earnings (losses) for its equity-method investment in Propelis includes the months from July 2025 through December 2025.

For the three and six months ended March 31, 2026, the Company recognized $ 9,283 and $ 11,581 , respectively, of equity-method losses for its equity-method investment in Propelis, which has been recorded as a component of administrative expense.

Equity-method losses for the three and six months ended March 31, 2026 included $ 8,092 and $ 9,198 of losses, respectively, representing the Company's portion of the investee's losses, and $ 1,191 and $ 2,383 of additional expense, respectively, reflecting the amortization of the Company's portion of the basis difference of the amortizable assets contributed from SGS & Co.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Investments (continued)

The Company also recognized $ 1,258 and $ 2,508 , respectively, of paid-in-kind interest income for the three and six months ended March 31, 2026, related to the Company's preferred equity investment in Propelis, which was included as a component of other income (deductions), net.

Debt and Financing Arrangements

Long-term debt at December 31, 2025 and September 30, 2025 consisted of the following:

December 31, 2025 September 30, 2025

Long-term debt at March 31, 2026 and September 30, 2025 consisted of the following:

March 31, 2026 September 30, 2025

Revolving credit facilities $ 404,750 $ 385,007

Secured term loan 148,807 —

2027 Senior Secured Notes — 296,110

4 unchanged sentences

Long-term debt $ 571,950 $ 703,602

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Debt and Financing Arrangements (continued)

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 $ 700,000 senior secured revolving credit facility, which matures in January 2029, subject to the terms and conditions of the amended facility.

The Company has a domestic credit facility with a syndicate of financial institutions that was amended and restated in February 2026 and includes a $ 700,000 secured revolving credit facility and a $ 150,000 secured amortizing term loan.

The term loan requires scheduled principal payments of $ 7,500 per year, payable in quarterly installments.

The balance of the revolving credit facility and the term loan are due on the maturity date of January 31, 2029, subject to the terms and conditions of the amended and restated facility.

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

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

Borrowings under the revolving credit facility bear interest at the Secured Overnight Financing Rate ("SOFR"), plus a 0.10 % per annum rate spread adjustment, plus a factor ranging from 1.00 % to 2.00 % ( 1.25 % at December 31, 2025) based on the Company's leverage ratio.

Borrowings under both the revolving credit facility and the term loan bear interest at the 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 March 31, 2026) 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 in connection with the amended and restated agreement.

Unamortized costs were $ 3,618 and $ 3,918 at December 31, 2025 and September 30, 2025, respectively.

The Company incurred debt issuance costs of $ 1,576 in connection with the amended and restated agreement, which were deferred and are being amortized over the term of the facility.

Unamortized costs were $ 4,592 and $ 3,918 at March 31, 2026 and September 30, 2025, respectively.

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

1 unchanged sentence

Outstanding U.S.

dollar denominated borrowings on the revolving credit facility at December 31, 2025 and September 30, 2025 were $ 213,986 and $ 384,233 , respectively.

The weighted-average interest rate on outstanding borrowings for the domestic credit facility (including the effects of interest rate swaps) at December 31, 2025 and 2024 was 3.68 % and 5.17 %, respectively.

As of December 31, 2025, the Company had $ 300,000 aggregate principal amount of 8.625 % senior secured second lien notes due October 1, 2027 (the "2027 Senior Secured Notes").

dollar denominated borrowings on the revolving credit facility at March 31, 2026 and September 30, 2025 were $ 404,750 and $ 384,233 , respectively.

Outstanding borrowings on the term loan at March 31, 2026 were $ 148,807 .

The weighted-average interest rate on outstanding borrowings for the domestic credit facility (including the effects of interest rate swaps) at March 31, 2026 and 2025 was 4.18 % and 4.29 %, respectively.

The Company previously had $ 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 bore 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.

2 unchanged sentences

The Company incurred direct financing fees and costs in connection with 2027 Senior Secured Notes.

Unamortized costs related to the Company’s notes were $ 3,404 and $ 3,890 at December 31, 2025 and September 30, 2025, respectively.

On January 22, 2026, subsequent to the date of the balance sheet, the Company redeemed all of the outstanding 2027 Senior Secured Notes for a redemption price of 104.313 % of the outstanding principal amount of the 2027 Senior Secured Notes, plus accrued and unpaid interest on such notes as of the redemption date.

Unamortized costs related to the Company’s notes were $ 3,890 at September 30, 2025.

In January 2026, the Company redeemed all of the outstanding 2027 Senior Secured Notes for a redemption price of 104.313 % of the outstanding principal amount of the 2027 Senior Secured Notes, plus accrued and unpaid interest on such notes as of the redemption date.

The total amount paid to redeem the 2027 Senior Secured Notes was $ 320,917 , which was primarily funded using proceeds from recent divestitures, and additional borrowings under the Company’s domestic credit facility.

In connection with this redemption, the Company expects to recognize debt extinguishment charges of approximately $ 16,343 during the second quarter of fiscal 2026.

In connection with this redemption, the Company recognized debt extinguishment charges of $ 16,343 during the second quarter of fiscal 2026, which included the write-off of the remaining unamortized direct financing costs of $ 3,404 .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Debt and Financing Arrangements (continued)

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.

8 unchanged sentences

The fair value of the sold receivables approximated book value due to their credit quality and short-term nature, and as a result, no gain or loss on sale of receivables was recorded.

As of December 31, 2025 and September 30, 2025, the amount sold to the Purchasers was $ 51,000 and $ 65,600 , respectively, which was derecognized from the Consolidated Balance Sheets.

As collateral against sold receivables, Matthews RFC maintains a certain level of unsold receivables, which was $ 73,011 and $ 63,720 as of December 31, 2025 and September 30, 2025, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Debt and Financing Arrangements (continued)

As of March 31, 2026 and September 30, 2025, the amount sold to the Purchasers was $ 55,800 and $ 65,600 , respectively, which was derecognized from the Consolidated Balance Sheets.

As collateral against sold receivables, Matthews RFC maintains a certain level of unsold receivables, which was $ 66,342 and $ 63,720 as of March 31, 2026 and September 30, 2025, respectively.

The following table sets forth a summary of receivables sold as part of the RPA:

Three Months Ended

December 31, 2025 Three Months Ended

December 31, 2024

Six Months Ended

March 31, 2026 Six Months Ended

March 31, 2025

Gross receivables sold

8 unchanged sentences

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

As a result of the sale of the Company's interest in the SGK Business, this arrangement no longer exists for the Company at December 31, 2025.

The principal amount of receivables sold under this arrangement was $ 21,449 during the three months ended December 31, 2024.

As a result of the sale of the Company's interest in the SGK Business, this arrangement no longer exists for the Company at March 31, 2026.

The principal amount of receivables sold under this arrangement was $ 38,789 during the six months ended March 31, 2025.

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

2 unchanged sentences

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 amounts owed to a participating financial institution under the Program and included in trade accounts payable were $ 5,792 and $ 6,136 at December 31, 2025 and September 30, 2025, respectively.

The amounts owed to a participating financial institution under the Program and included in trade accounts payable were $ 4,557 and $ 6,136 at March 31, 2026 and September 30, 2025, respectively.

The Company, through certain of its European subsidiaries, has a credit facility with a European bank, which is guaranteed by Matthews.

2 unchanged sentences

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

Outstanding borrowings under the credit facility totaled € 86,000 ($ 101 ) and € 659,000 ($ 774 ) at December 31, 2025 and September 30, 2025, respectively.

The weighted-average interest rate on outstanding borrowings under this facility was 4.93 % and 5.10 % at December 31, 2025 and 2024, respectively.

Other borrowings totaled $ 5,385 and $ 7,151 at December 31, 2025 and September 30, 2025, respectively.

The weighted-average interest rate on all other borrowings was 1.33 % and 2.33 % at December 31, 2025 and 2024, respectively.

As of December 31, 2025 and September 30, 2025, the fair value of the Company's long-term debt, including current maturities, which is classified as Level 2 in the fair value hierarchy, approximated the carrying value included in the Consolidated Balance Sheets.

The Company was in compliance with all of its debt covenants as of December 31, 2025.

On March 11, 2025, in connection with the filing of an automatic shelf registration statement on Form S-3 pursuant to which the Company re-registered 3,000,000 shares of Class A Common Stock, the Company entered into an Equity Distribution Agreement for an At-The-Market equity offering program ("ATM Program") pursuant to which the Company may issue and sell, from time to time, up to 1,250,000 shares of its Class A Common Stock under the shelf registration.

For the three months ended December 31, 2025, the Company did not sell any shares of its Class A Common Stock under its ATM Program.

As of December 31, 2025, the Company had 1,250,000 shares remaining for sale under the ATM Program.

The Company has no near-term intention to utilize the ATM Program.

Outstanding borrowings under the credit facility totaled € 659,000 ($ 774 ) at September 30, 2025.

There were no outstanding borrowings under the credit facility at March 31, 2026.

The weighted-average interest rate on outstanding borrowings under this facility was 4.60 % at March 31, 2025.

Other borrowings totaled $ 6,436 and $ 7,151 at March 31, 2026 and September 30, 2025, respectively.

The weighted-average interest rate on all other borrowings was 1.90 % and 2.16 % at March 31, 2026 and 2025, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Debt and Financing Arrangements (continued)

As of March 31, 2026 and September 30, 2025, the fair value of the Company's long-term debt, including current maturities, which is classified as Level 2 in the fair value hierarchy, approximated the carrying value included in the Consolidated Balance Sheets.

The Company was in compliance with all of its debt covenants as of March 31, 2026.

For the six months ended March 31, 2026, the Company did not sell any shares of its Class A Common Stock under its ATM Program.

As of March 31, 2026, the Company had 1,250,000 shares remaining for sale under the ATM Program.

The Company has no near-term intention to utilize the ATM Program.

Derivatives and Hedging Activities

The Company operates internationally and utilizes certain derivative financial instruments to manage its foreign currency, debt and interest rate exposures.

At December 31, 2025 and September 30, 2025, derivative instruments were reflected on a gross-basis in the Consolidated Balance Sheets as follows:

December 31, 2025 September 30, 2025

At March 31, 2026 and September 30, 2025, derivative instruments were reflected on a gross-basis in the Consolidated Balance Sheets as follows:

March 31, 2026 September 30, 2025

Interest Rate Swaps Cross-Currency Swaps Interest Rate Swaps Cross-Currency Swaps

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$ ( 820 ) $ ( 53,645 ) $ ( 2,338 ) $ ( 58,541 )

(1) Cross-currency swap amounts at both December 31, 2025 and September 30, 2025 reflect $ 40,186 of partial advanced payments received from the counterparties to certain swap contracts (see below).

(1) Cross-currency swap amounts at both March 31, 2026 and September 30, 2025 reflect $ 40,186 of partial advanced 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:

December 31, 2025 September 30, 2025

March 31, 2026 September 30, 2025

Notional amount $ 300,000 $ 225,000

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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 loss of $ 2,291 ($ 1,721 after tax) and $ 2,338 ($ 1,752 after tax) at December 31, 2025 and September 30, 2025, respectively, that is included in shareholders' equity as part of accumulated other comprehensive income (loss) ("AOCI").

Unrecognized gains of $ 1,301 ($ 972 after tax) and $ 1,605 ($ 1,199 after tax) related to previously terminated London Interbank Offered Rate ("LIBOR") based swaps were also included in AOCI as of December 31, 2025 and September 30, 2025, respectively.

Assuming market rates remain constant with the rates at December 31, 2025, a loss (net of tax) of approximately $ 18 included in AOCI is expected to be recognized in earnings over the next twelve months.

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:

The fair value of the interest rate swaps reflected a net unrealized loss of $ 820 ($ 621 after tax) and $ 2,338 ($ 1,752 after tax) at March 31, 2026 and September 30, 2025, respectively, that is included in shareholders' equity as part of accumulated other comprehensive income (loss) ("AOCI").

Unrecognized gains of $ 1,011 ($ 757 after tax) and $ 1,605 ($ 1,199 after tax) related to previously terminated London Interbank Offered Rate ("LIBOR") based swaps were also included in AOCI as of March 31, 2026 and September 30, 2025, respectively.

Assuming market rates remain constant with the rates at March 31, 2026, a gain (net of tax) of approximately $ 392 included in AOCI is expected to be recognized in earnings over the next twelve months.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

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Derivatives and Hedging Activities (continued)

Notional Amount Unrealized Gains (Losses)

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 December 31, 2025 September 30, 2025 December 31, 2025 September 30, 2025

Swap Currencies Maturity Date March 31, 2026 September 30, 2025 March 31, 2026 September 30, 2025

USD/EUR September 2027 $ 81,392 $ 81,392 $ ( 7,929 ) $ ( 9,443 )

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$ ( 13,703 ) (1)

(1) Total unrealized gains (losses) are presented net of tax of $ 4,337 and $ 4,652 as of December 31, 2025 and September 30, 2025, respectively.

(1) Total unrealized gains (losses) are presented net of tax of $ 3,376 and $ 4,652 as of March 31, 2026 and September 30, 2025, 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.

Outstanding advance payment amounts totaled $ 40,186 at both December 31, 2025 and September 30, 2025, all of which were included in other current liabilities on the Consolidated Balance Sheet.

Outstanding advance payment amounts totaled $ 40,186 at both March 31, 2026 and September 30, 2025, all of which were included in other current liabilities on the Consolidated Balance Sheet.

Refer to Note 13, "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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Three Months Ended

March 31, Six Months Ended

2026 2025 2026 2025

Cost of sales $ ( 194 ) $ 3,013 $ ( 1,713 ) $ 2,315

Selling expense — ( 44 ) — ( 53 )

Administrative expense ( 588 ) ( 498 ) ( 592 ) ( 957 )

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The costs associated with the Company's restructuring programs principally relate to severance and employee termination benefits.

The following table provides a summary of the severance and employee termination restructuring activities for the three-month period ended December 31, 2025.

The following table provides a summary of the severance and employee termination restructuring activities for the six-month period ended March 31, 2026.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

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( 2 ) 92 — ( 83 ) 7

December 31, 2025 $ — $ 775 $ — $ — $ 775

March 31, 2026 $ — $ 810 $ — $ — $ 810

Cumulative severance and employee termination costs incurred to date (2)

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(1) Other adjustments primarily reflects reclassifications of certain balance sheet amounts.

(2) Substantially all estimated severance and employee termination costs related to the restructuring programs have been recognized as of December 31, 2025.

(2) Substantially all estimated severance and employee termination costs related to the restructuring programs have been recognized as of March 31, 2026.

The severance and employee termination liability is included in accrued compensation in the accompanying Consolidated Balance Sheets.

The restructuring programs initiated in fiscal 2024 that were focused primarily on the Company's engineering and tooling operations in Europe, and certain of the Company's general and administrative functions have been substantially completed as of December 31, 2025.

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 ("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 second amendment and restatement of the 2017 Equity Incentive Plan, the maximum number of shares available for grants or awards is an aggregate of 4,950,000 (subject to adjustment upon certain events such as stock dividends or stock splits), following the second amendment and restatement of the 2017 Equity Incentive Plan at the Company's 2025 Annual Shareholder Meeting.

At December 31, 2025, 2,428,387 shares have been issued under the 2017 Equity Incentive Plan.

Under the 2017 Equity Incentive Plan, which has a ten-year term from the date the Company's Board of Directors approved of the second amendment and restatement of the 2017 Equity Incentive Plan, the maximum number of shares available for grants or awards is an aggregate of 4,950,000 (subject to adjustment upon certain events such as stock dividends or stock splits), following the approval by shareholders of the adoption of the Second Amended and Restated 2017 Equity Incentive Plan at the Company's 2025 Annual Shareholder Meeting.

At March 31, 2026, 2,492,953 shares have been issued under the 2017 Equity Incentive Plan.

1,802,905 time-based RSUs, 2,241,872 performance-based RSUs, and 75,000 stock options have been granted under the 2017 Equity Incentive Plan.

1,657,675 of these share-based awards are outstanding as of December 31, 2025.

1,624,489 of these share-based awards are outstanding as of March 31, 2026.

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

The number of 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 three-month periods ended December 31, 2025 and 2024, stock-based compensation cost totaled $ 4,407 and $ 4,979 , respectively.

The associated future income tax benefit recognized for stock-based compensation was $ 645 and $ 818 for the three-month periods ended December 31, 2025 and 2024, respectively.

For the three-month periods ended March 31, 2026 and 2025, stock-based compensation cost totaled $ 5,136 and $ 6,018 , respectively.

For the six-month periods ended March 31, 2026 and 2025, stock based compensation totaled $ 9,543 and $ 10,997 , respectively.

The associated future income tax benefit recognized for stock-based compensation was $ 1,289 and $ 1,520 for the three-month periods ended March 31, 2026 and 2025, respectively, and $ 1,933 and $ 2,338 for the six-month periods ended March 31, 2026 and 2025, respectively.

With respect to the grants of RSUs, awards generally vest on the third anniversary of the grant date.

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Share-Based Payments (continued)

The transactions for RSUs for the three months ended December 31, 2025 were as follows:

The transactions for RSUs for the six months ended March 31, 2026 were as follows:

RSUs Weighted-

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Expired or forfeited ( 31,490 ) 31.61

Non-vested at December 31, 2025 1,657,675 $ 30.17

As of December 31, 2025, the total unrecognized compensation cost related to all unvested stock-based awards was $ 23,485 and is expected to be recognized over a weighted average period of 2.3 years.

Non-vested at March 31, 2026 1,624,489 $ 30.01

As of March 31, 2026, the total unrecognized compensation cost related to all unvested stock-based awards was $ 19,875 and is expected to be recognized over a weighted average period of 2.1 years.

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 or modified during the three-month period ended December 31, 2025.

Three Months Ended

December 31, 2025

The following table indicates the assumptions used in estimating the fair value of certain stock-based awards granted or modified during the six-month period ended March 31, 2026.

Six Months Ended

March 31, 2026

Expected volatility 36.7 %

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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 three months ended December 31, 2025 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").

The expected term for grants in the six months ended March 31, 2026 represents an estimate of the average period of time for RSUs to vest.

The Company maintains the Second 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").

There will be no further fees or share-based awards granted under the Amended and Restated 2014 Director Fee Plan and the 1994 Director Fee Plan.

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 2026, either cash or shares of the Company's Class A Common Stock with a value equal to $ 90 .

The annual retainer fee for fiscal 2026 paid to the non-employee Chairman of the Board under the Amended and Restated 2019 Director Fee Plan is $ 210 .

Under the Second 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 2026, either cash or shares of the Company's Class A Common Stock with a value equal to $ 90 .

The annual retainer fee for fiscal 2026 paid to the non-employee Chairman of the Board under the Second Amended and Restated 2019 Director Fee Plan 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 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.

In November 2025, the Board of Directors approved the Second Amended and Restated 2019 Director Fee Plan, which increases the maximum number of shares available for grants or awards to 550,000 shares.

The Second Amended and Restated 2019 Director Fee Plan is subject to shareholder approval at the 2026 Annual Meeting of Shareholders.

The total number of shares of stock that have been authorized to be issued under the Second Amended and Restated 2019 Director Fee Plan or credited to a deferred stock compensation account for subsequent issuance is 550,000 shares of Class A Common Stock (subject to adjustment upon certain events such as stock dividends or stock splits), following the approval by shareholders of the adoption of the Second Amended and Restated 2019 Director Fee Plan at the Company's 2026 Annual Shareholder Meeting.

The value of deferred shares is recorded in other non-current liabilities.

A total of 57,668 shares and share units had been deferred under the Director Fee Plans as of December 31, 2025.

A total of 69,677 shares and share units had been deferred under the Director Fee Plans as of March 31, 2026.

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 2026.

As of December 31, 2025, 439,740 restricted shares and RSUs have been granted under the Director Fee Plans, 266,511 of which were issued under the 2019 Director Fee Plan.

98,945 RSUs are unvested at December 31, 2025 under the Director Fee Plans.

As of March 31, 2026, 489,744 restricted shares and RSUs have been granted under the Director Fee Plans, 316,515 of which were issued under the 2019 Director Fee Plan.

110,045 RSUs are unvested at March 31, 2026 under the Director Fee Plans.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

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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:

Three Months Ended

Net income (loss) $ 43,629 $ ( 3,472 )

March 31, Six Months Ended

2026 2025 2026 2025

Net (loss) income $ ( 21,834 ) $ ( 8,916 ) $ 21,795 $ ( 12,388 )

Weighted-average shares outstanding (in thousands):

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Accumulated Other Comprehensive Income

The changes in AOCI by component, net of tax, for the three-month periods ended December 31, 2025 and 2024 were as follows:

The changes in AOCI by component, net of tax, for the three-month periods ended March 31, 2026 and 2025 were as follows:

Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total

Attributable to Matthews:

Balance, December 31, 2025 $ 6,203 $ ( 55,658 ) $ ( 749 ) $ ( 50,204 )

OCI before reclassification ( 95 ) ( 6,108 ) 868 ( 5,335 )

Amounts reclassified from AOCI ( 163 ) (a)

Net current-period OCI ( 258 )

885 ( 5,042 )

Balance, March 31, 2026 $ 5,945 $ ( 61,327 ) $ 136 $ ( 55,246 )

Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total

Attributable to Matthews:

Balance, December 31, 2024 $ 4,602 $ ( 189,234 ) $ 3,141 $ ( 181,491 )

OCI before reclassification 100 8,580 ( 1,778 ) 6,902

Amounts reclassified from AOCI ( 169 ) (a)

( 228 ) ( 188 ) (b)

Net current-period OCI ( 69 ) 8,352 ( 1,966 ) 6,317

Balance, March 31, 2025 $ 4,533 $ ( 180,882 ) $ 1,175 $ ( 175,174 )

Attributable to noncontrolling interest:

Balance, December 31, 2024 $ — $ 289 $ — $ 289

OCI before reclassification — —

Net current-period OCI — — — —

Balance, March 31, 2025 $ — $ 289

(a) Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans.

(b) Amounts were included in interest expense in the periods in which the hedged item affected earnings (see Note 9).

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Accumulated Other Comprehensive Income (continued)

The changes in AOCI by component, net of tax, for the six-month periods ended March 31, 2026 and 2025 were as follows:

Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total

Attributable to Matthews:

Balance, September 30, 2025 $ 7,540 $ ( 84,997 ) $ ( 553 ) $ ( 78,010 )

4 unchanged sentences

23,670 689 22,764

Balance, December 31, 2025 $ 6,203 $ ( 55,658 ) $ ( 749 ) $ ( 50,204 )

Balance, March 31, 2026 $ 5,945 $ ( 61,327 ) $ 136 $ ( 55,246 )

Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total

5 unchanged sentences

Net current-period OCI ( 422 ) ( 6,259 ) 249 ( 6,432 )

Balance, December 31, 2024 $ 4,602 $ ( 189,234 ) $ 3,141 $ ( 181,491 )

Balance, March 31, 2025 $ 4,533 $ ( 180,882 ) $ 1,175 $ ( 175,174 )

Attributable to noncontrolling interest:

2 unchanged sentences

Net current-period OCI — — — —

Balance, December 31, 2024 $ — $ 289

Balance, March 31, 2025 $ — $ 289

(a) Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans.

3 unchanged sentences

Accumulated Other Comprehensive Income (continued)

Reclassifications out of AOCI for the three-month periods ended December 31, 2025 and 2024 were as follows:

Reclassifications out of AOCI for the three and six-month periods ended March 31, 2026 and 2025 were as follows:

Amount reclassified from AOCI

Details about AOCI Components Three Months Ended December 31, 2025 Three Months Ended December 31, 2024 Affected line item in the

Details about AOCI Components Three Months Ended March 31, 2026 Six Months Ended March 31, 2026 Affected line item in the

Financial Statements

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Divestitures $ — $ ( 17,674 ) Gain on divestitures, net

Details about AOCI Components Three Months Ended

March 31, 2025 Six Months Ended

March 31, 2025 Affected line item in the Statement of income

Postretirement benefit plans

Prior service credit (a)

Actuarial losses 137 274 Other income (deductions), net

226 454 Income before income tax (b)

( 114 ) Income taxes

$ 340 Net income

Cash flow hedges $ 252

$ 720 Interest expense

Net investment hedges 301 656 Interest expense

553 1,376 Income before income tax (b)

( 342 ) Income taxes

$ 416 $ 1,034 Net income

Divestitures $ — $ ( 6,844 ) Other current liabilities (c)

3 unchanged sentences

See Note 16, "Acquisitions and Divestitures".

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Income tax provisions for the Company's interim periods are based on the effective income tax rate expected to be applicable for the full year.

The Company's consolidated income taxes for the first three months of fiscal 2026 represented an expense of $ 40,789 , compared to a benefit of $ 2,358 for the first three months of fiscal 2025.

The difference between the Company’s consolidated income taxes for the first three months of fiscal 2026 compared to the same period for fiscal 2025 resulted from consolidated pre-tax income in fiscal 2026 compared to a consolidated pre-tax loss in fiscal 2025, and net discrete tax expense related to the divestiture of the Company's warehouse automation and European roto-gravure packaging and tooling and flexographic print businesses.

The Company’s fiscal 2026 three month effective tax rate varied from the U.S.

statutory tax rate of 21.0% primarily due to state taxes, tax credits, non-tax benefited foreign losses and discrete tax expense related to the divestiture of the Company's warehouse automation and European roto-gravure packaging and tooling and flexographic print businesses.

The Company’s fiscal 2025 three month effective tax rate varied from the U.S.

The Company's consolidated income taxes for the first six months of fiscal 2026 represented an expense of $ 34,572 , compared to a benefit of $ 5,086 for the first six months of fiscal 2025.

The difference between the Company’s consolidated income taxes for the first six months of fiscal 2026 compared to the same period for fiscal 2025 resulted from consolidated pre-tax income in fiscal 2026 compared to a consolidated pre-tax loss in fiscal 2025, and net discrete tax expense related to the divestiture of the Company's warehouse automation and European roto-gravure packaging and tooling and flexographic print businesses, partially offset by other net discrete tax benefits.

The Company’s fiscal 2026 six month effective tax rate varied from the U.S.

The Company’s fiscal 2025 six month effective tax rate varied from the U.S.

statutory tax rate of 21.0% primarily due to state taxes, tax credits, non-tax benefited foreign losses, and other net discrete tax benefits.

The Company had unrecognized tax benefits (excluding penalties and interest) of $ 2,860 and $ 2,972 on December 31, 2025 and September 30, 2025, respectively, which would impact the annual effective rate at December 31, 2025 and September 30, 2025, respectively.

The Company had unrecognized tax benefits (excluding penalties and interest) of $ 2,897 and $ 2,972 on March 31, 2026 and September 30, 2025, respectively, which would impact the annual effective rate at March 31, 2026 and September 30, 2025, respectively.

It is reasonably possible that the amount of unrecognized tax benefits could decrease by approximately $ 334 in the next 12 months primarily due to the completion of audits and the expiration of the statute of limitations.

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

Total penalties and interest accrued were $ 204 and $ 241 at December 31, 2025 and September 30, 2025, respectively.

Total penalties and interest accrued were $ 284 and $ 241 at March 31, 2026 and September 30, 2025, respectively.

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Income Taxes (continued)

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

The Company continues to evaluate the impact of the OBBBA, and at this time does not expect the provisions of the new legislation to have a material impact on the Company's consolidated financial statements.

The legislation has multiple effective dates, with certain provisions that were effective in 2025, and others implemented through 2027.

The Company has evaluated the impact of the OBBBA, and does not expect the provisions of the new legislation will have a material impact on the Company's consolidated financial statements.

The Company expects the provisions of the legislation will have a favorable impact on fiscal 2026 cash tax payments.

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

As of December 31, 2025, the tax years that remain subject to examination by major jurisdictions generally are:

As of March 31, 2026, the tax years that remain subject to examination by major jurisdictions generally are:

United States – Federal 2019, 2020, 2022 and forward

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Australia 2022 and forward

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Segment Information

2 unchanged sentences

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 product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions.

The Industrial Technologies segment includes product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions including coating and converting lines.

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On December 31, 2025, the Company sold its warehouse automation business for cash and other consideration.

On December 31, 2025, the Company sold its warehouse automation business for cash consideration.

Following the completion of these transactions, the Company's Industrial Technologies segment consists of product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions including coating and converting lines, and the Company's Brand Solutions segment consists of its 40 % ownership interest in Propelis.

Activity prior to May 1, 2025 for the SGK Business is included within the consolidated financial statements of the Company.

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

This presentation is consistent with how the Company's chief operating decision maker (the “CODM”), identified as the Company's President and Chief Executive Officer, evaluates

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Segment Information (continued)

the results of operations versus budgets, forecasts, and historical performance, and makes strategic and resource allocation decisions about the business.

In addition, adjusted EBITDA does not include depreciation, intangible amortization, interest expense and other items incurred by Propelis.

Reportable Segments adjusted EBITDA is also determined before corporate and non-operating expenses.

This presentation is consistent with how the Company's chief operating decision maker (the “CODM”), identified as the Company's President and Chief Executive Officer, evaluates the results of operations versus budgets, forecasts, and historical performance, and makes strategic and resource allocation decisions about the business.

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

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Information about the Company's reportable segments follows:

Three Months Ended December 31, 2025

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Segment Information (continued)

Three Months Ended March 31, 2026

Memorialization Industrial Technologies Brand Solutions (1)

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Total assets (4)

902,636 310,549 258,193 1,471,378

Capital expenditures 1,907 1,723 134 3,764

Three Months Ended December 31, 2024

Six Months Ended March 31, 2026

Memorialization Industrial Technologies Brand Solutions (1)

9 unchanged sentences

( 55,188 ) ( 21,207 ) ( 13,759 ) ( 90,154 )

Other segment items (3)

— — 33,979 33,979

Adjusted EBITDA $ 87,780 $ ( 7,771 ) $ 22,309 $ 102,318

1 unchanged sentence

Depreciation and amortization 16,188 6,444 609 23,241

Capital expenditures 6,437 2,018 321 8,776

Three Months Ended March 31, 2025

Memorialization Industrial Technologies Brand Solutions (1)

Reportable Segments Total

Sales $ 205,620 $ 80,835 $ 141,174 $ 427,629

Cost of sales (2)

( 115,339 ) ( 53,495 ) ( 104,874 ) ( 273,708 )

Gross profit (2)

90,281 27,340 36,300 153,921

Selling expense (2)

( 20,486 ) ( 7,989 ) ( 8,075 ) ( 36,550 )

Administrative expense (2)

( 24,757 ) ( 13,309 ) ( 12,629 ) ( 50,695 )

Adjusted EBITDA $ 45,038 $ 6,042 $ 15,596 $ 66,676

Intersegment sales $ — $ 64 $ 433 $ 497

Depreciation and amortization 7,170 5,644 4,718 17,532

Total assets (4)

823,391 443,290 470,851 1,737,532

Capital expenditures 4,266 1,827 2,510 8,603

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Segment Information (continued)

Six Months Ended March 31, 2025

Memorialization Industrial Technologies Brand Solutions (1)

Reportable Segments Total

Sales $ 396,106 $ 161,368 $ 271,997 $ 829,471

Cost of sales (2)

( 224,232 ) ( 111,346 ) ( 202,766 ) ( 538,344 )

Gross profit (2)

171,874 50,022 69,231 291,127

Selling expense (2)

( 39,454 ) ( 15,469 ) ( 15,912 ) ( 70,835 )

Administrative expense (2)

( 50,770 ) ( 26,679 ) ( 25,431 ) ( 102,880 )

Adjusted EBITDA $ 81,650 $ 7,874 $ 27,888 $ 117,412

Intersegment sales $ — $ 374 $ 716 $ 1,090

Depreciation and amortization 14,372 11,318 13,578 39,268

Capital expenditures 8,756 3,209 6,154 18,119

(1) Amounts do not include revenue recognized by, costs and expenses attributable to, or assets owned by Propelis, since Propelis is a non-consolidated subsidiary accounted for under the equity-method.

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(2) Amounts do not include certain non-cash and/or non-recurring items that do not contribute directly to management's evaluation of its operating results (as described further in the reconciliation of adjusted EBITDA in the table below) and also exclude depreciation, amortization and stock-based compensation expense.

(3) The three-months ended December 31, 2025 includes the Company's portion of depreciation, intangible amortization, interest expense, and other items incurred by Propelis (see Note 7, "Investments" for further information with respect to the equity-method investment in Propelis).

(3) The three and six months ended March 31, 2026 includes the Company's portion of depreciation, intangible amortization, interest expense, and other items incurred by Propelis (see Note 7, "Investments" for further information with respect to the equity-method investment in Propelis).

(4) Total assets represent amounts at March 31, 2026 and 2025, respectively.

A reconciliation of adjusted EBITDA to income (loss) before income taxes and net income (loss) follows:

Three Months Ended

Three Months Ended March 31, Six Months Ended March 31,

2026 2025 2026 2025

Reportable Segments Adjusted EBITDA $ 55,133 $ 66,676 $ 102,318 $ 117,412

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( 6,394 ) ( 5,373 ) ( 21,644 ) ( 5,988 )

Gain on divestitures, net 113,209 —

Gain (loss) on divestitures, net ( 3,945 ) ( 2,072 ) 109,264 ( 2,072 )

Highly inflationary accounting losses (primarily non-cash) (3)

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( 10,424 ) ( 17,010 ) ( 25,725 ) ( 33,864 )

Loss on debt extinguishment ( 16,343 ) — ( 16,343 ) —

Propelis depreciation, amortization, interest and other items (6)

Income (loss) before income taxes 84,418 ( 5,830 )

Income tax (provision) benefit ( 40,789 ) 2,358

Net income (loss) $ 43,629 $ ( 3,472 )

( 18,776 ) — ( 33,979 ) —

(Loss) income before income taxes ( 28,051 ) ( 11,644 ) 56,367 ( 17,474 )

Income tax benefit (provision) 6,217 2,728 ( 34,572 ) 5,086

Net (loss) income $ ( 21,834 ) $ ( 8,916 ) $ 21,795 $ ( 12,388 )

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Segment Information (continued)

(1) Includes certain non-recurring items associated with recent acquisition and divestiture activities.

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

Also includes legal costs related to an ongoing dispute with Tesla, which totaled $ 8,997 and $ 6,867 for the three months ended December 31, 2025 and 2024, respectively (see Note 18, "Legal Matters").

Fiscal 2025 includes net gains on the sales of certain significant property and other assets of $ 8,702 for the three months ended December 31, 2024.

Fiscal 2025 also includes loss recoveries totaling $ 1,170 for the three months ended December 31, 2024 which were related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.

Also includes legal costs related to an ongoing dispute with Tesla, which totaled $ 2,175 and $ 1,757 for the three months ended March 31, 2026 and 2025, respectively, and $ 11,172 and $ 8,624 for the six months ended March 31, 2026 and 2025, respectively (see Note 18, "Legal Matters").

Fiscal 2025 includes costs related to the Company's 2025 contested proxy which totaled $ 4,538 for the three months ended March 31, 2025 and $ 4,902 for the six months ended March 31, 2025.

Fiscal 2025 includes net gains on the sales of certain significant property and other assets of $ 8,655 for the six months ended March 31, 2025.

Fiscal 2025 also includes loss recoveries totaling $ 1,170 for the six months ended March 31, 2025 which were related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.

(3) Represents exchange losses associated with highly inflationary accounting related to certain Turkish subsidiaries which were recently divested (see Note 2, "Basis of Presentation").

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Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative of the current or future cash flow requirements related to these employee benefit plans.

(5) Includes fees for receivables sold under the RPA and factoring arrangements totaling $ 668 and $ 1,172 for the three months ended December 31, 2025 and 2024, respectively.

(5) Includes fees for receivables sold under the RPA and factoring arrangements totaling $ 382 and $ 1,145 for the three months ended March 31, 2026 and 2025, respectively, and $ 1,050 and $ 2,317 for the six months ended March 31, 2026 and 2025, respectively.

(6) Represents the Company's portion of depreciation, intangible amortization, interest expense, and other items incurred by Propelis (see Note 7, "Investments" for further information with respect to the equity-method investment in Propelis).

* Depreciation and amortization was $ 8,147 and $ 7,202 for the Memorialization segment, $ 3,478 and $ 5,674 for the Industrial Technologies segment, $ 609 and $ 8,860 for the Brand Solutions segment, and $ 462 and $ 768 for Corporate and Non-Operating, for the three months ended December 31, 2025 and 2024, respectively.

** Acquisition and divestiture costs, ERP system integration costs, and strategic initiatives and other charges were $ 69 and $ 1,303 for the Memorialization segment, $ 10,353 and $ 4,119 for the Industrial Technologies segment, $ 3,493 and $ 714 for the Brand Solutions segment, and charges of $ 2,453 and income of $ 4,944 for Corporate and Non-Operating, for the three months ended December 31, 2025 and 2024, respectively.

† Strategic initiatives and other items includes charges for exit and disposal activities (including severance and other employee termination benefits) totaling expenses of $ 1,523 and $ 313 for the three months ended December 31, 2025 and 2024, respectively, Refer to Note 10, "Restructuring" for further details.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

* Depreciation and amortization was $ 8,041 and $ 7,170 for the Memorialization segment, $ 2,966 and $ 5,644 for the Industrial Technologies segment, and $ 501 and $ 699 for Corporate and Non-Operating, for the three months ended March 31, 2026 and 2025, respectively.

Depreciation and amortization was $ 16,188 and $ 14,372 for the Memorialization segment, $ 6,444 and $ 11,318 for the Industrial Technologies segment, $ 609 and $ 13,578 for the Brand Solutions segment, and $ 963 and $ 1,467 for Corporate and Non-Operating, for the six months ended March 31, 2026 and 2025, respectively.

Depreciation and amortization was $ 4,718 for the Brand Solutions segment for the three months ended March 31, 2026.

** Acquisition costs, ERP system integration costs, and strategic initiatives and other charges were $ 380 and $ 2,410 for the Memorialization segment, $ 2,739 and $ 192 for the Industrial Technologies segment, income of $ 91 and charges of $ 416 for the Brand Solutions segment, and $ 3,560 and $ 16,056 for Corporate and Non-Operating, for the three months ended March 31, 2026 and 2025, respectively.

Acquisition costs, ERP system integration costs, and strategic initiatives and other charges were $ 449 and $ 3,713 for the Memorialization segment, $ 13,092 and $ 4,311 for the Industrial Technologies segment, $ 3,402 and $ 1,130 for the Brand Solutions segment, and $ 6,013 and $ 11,112 for Corporate and Non-Operating, for the six months ended March 31, 2026 and 2025, respectively.

† Strategic initiatives and other items includes charges for exit and disposal activities (including severance and other employee termination benefits) totaling expenses of $ 782 and income of $ 2,471 for the three months ended March 31, 2026 and 2025, respectively, and expenses of $ 2,305 and income of $ 1,305 for the six months ended March 31, 2026 and 2025, respectively.

Refer to Note 10, "Restructuring" for further details.

Acquisitions and Divestitures

In December 2025, the Company completed the sale of its interests in Matthews Automation Solutions, LLC, a Delaware limited liability company and wholly-owned subsidiary of Matthews, and certain related assets to Duravant LLC.

The total consideration was approximately $ 232,000 , representing cash consideration of $ 225,400 plus the assumption of certain liabilities related to the business, subject to adjustment based on a number of factors, including, but not limited to, indemnification obligations and the final determinations of the total adjusted consideration (based on an agreed enterprise value of $ 230 million, plus cash, less debt and transaction expenses and subject to a customary net working capital adjustment measured against a target amount).

The total cash consideration was $ 224,798 , subject to post-closing adjustments.

The transaction resulted in a pre-tax gain of $ 147,649 ($ 107,783 after-tax).

As of the date of the disposal transaction, the divested business had current assets and non-current assets of $ 21,381 and $ 62,174 , respectively, and current liabilities and non-current liabilities of $ 19,612 and $ 3,067 , respectively.

Income (loss) before income taxes for the divested business was a loss of $ 926 and income of $ 200 for the three-month periods ended December 31, 2025 and 2024, respectively.

Income (loss) before income taxes for the divested business was a loss of $ 926 for the six months ended March 31, 2026, and income of $ 1,078 and $ 1,278 for the three and six months ended March 31, 2025, respectively.

In December 2025, the Company completed the sale of its European roto-gravure packaging and tooling and flexographic print businesses to the local management of those businesses.

Total consideration from these divestitures is $ 41,009 , consisting of $ 13,658 of cash, $ 7,753 of deferred purchase price, principally due within 180 days of closing, seller financing of $ 7,660 , and liabilities assumed by the buyers (principally assumed debt and pension obligations) of $ 11,938 , and the transactions resulted in a pre-tax loss of $ 35,095 ($ 35,981 after-tax).

In connection with the sale of the European roto-gravure packaging and tooling and flexographic print businesses, the Company has agreed to provide certain limited administrative services for the respective buyers under short-term transitional services agreements.

Total consideration from these divestitures was $ 41,009 , consisting of $ 13,658 of cash received at closing, $ 3,831 of cash received subsequent to closing, $ 3,922 of remaining deferred purchase price, principally due within 180 days of closing, seller financing of $ 7,660 , and liabilities assumed by the buyers (principally assumed debt and pension obligations) of $ 11,938 , and the transactions resulted in a pre-tax loss of $ 38,385 ($ 39,332 after-tax).

In October 2025, the Company completed a small acquisition within the Industrial Technologies segment for a purchase price of $ 524 .

The preliminary purchase price allocation was not finalized as of December 31, 2025 and remains subject to change as the Company obtains additional information related to working capital and other intangibles assets.

The preliminary purchase price allocation was finalized as of March 31, 2026, resulting in adjustments to intangible assets.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Acquisitions and Divestitures (continued)

In May 2025, the Company acquired The Dodge Company ("Dodge") within the Memorialization segment for a purchase price of $ 55,624 (net of cash acquired).

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Annual sales for this business were approximately $ 43,000 prior to the acquisition.

The preliminary purchase price allocation was not finalized as of March 31, 2026 and remains subject to change as the Company obtains additional information related to working capital and other intangibles assets.

On May 1, 2025, the Company contributed its SGK Business to a newly-formed entity, Propelis, in exchange for 40 % of the common equity of Propelis, a $ 50,000 preferred equity investment in Propelis, and cash proceeds of $ 228,004 (net of $ 22,996 of divested cash).

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The Company recognized a gain on sale of the SGK Business totaling $ 55,139 ($ 6,158 after-tax) during fiscal 2025.

In March 2025, the Company completed a small divestiture within the Industrial Technologies segment.

Net proceeds from the divestiture totaled $ 2,049 , and the transaction resulted in a pre-tax loss of $ 2,072 , which was recorded as a component of administrative expense for the period ended March 31, 2025.

In October 2024, the Company completed a small acquisition within the Memorialization segment for a purchase price of $ 2,218 .

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The net assets for this business were fully written-down in fiscal 2024 in anticipation of the disposal transaction.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Goodwill and Other Intangible Assets

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$ 387,537 $ 100,024 $ — $ 487,561

Additions — 1,331 — 1,331

Divestitures — ( 57,471 ) — ( 57,471 )

Translation and other adjustments 3,198 ( 87 ) — 3,111

Net goodwill at December 31, 2025

Net goodwill at March 31, 2026

$ 390,735 $ 42,466 $ — $ 433,201

The net goodwill balances at December 31, 2025 and September 30, 2025 included $ 45,673 of accumulated impairment losses.

Accumulated impairment losses at December 31, 2025 and September 30, 2025 were $ 5,000 and $ 39,867 for the Memorialization and Industrial Technologies segments, respectively.

In fiscal 2026, additions reflect a small acquisition in the Industrial Technologies segment, and divestitures reflect the sale of the warehouse automation business.

The net goodwill balances at March 31, 2026 and September 30, 2025 included $ 44,867 and $ 45,673 of accumulated impairment losses, respectively.

Accumulated impairment losses at March 31, 2026 were $ 5,000 and $ 39,867 for the Memorialization and Industrial Technologies segments, respectively.

Accumulated impairment losses at September 30, 2025 were $ 5,000 and $ 40,673 for the Memorialization and Industrial Technologies segments, respectively.

In fiscal 2026 divestitures reflect the sale of the warehouse automation business.

The Company performed its annual impairment review of goodwill and indefinite-lived intangible assets in the second quarter of fiscal 2026 (January 1, 2026) and determined that the estimated fair values for all goodwill reporting units exceeded their carrying values, and, therefore, no impairment charges were necessary at such time.

The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of December 31, 2025 and September 30, 2025, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Goodwill and Other Intangible Assets (continued)

The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of March 31, 2026 and September 30, 2025, respectively.

Amount Accumulated

Amortization Net

December 31, 2025

March 31, 2026

Indefinite-lived trade names $ 30,540 $ — $ 30,540

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$ 248,466 $ ( 142,508 ) $ 105,958

The net change in intangible assets during the three months ended December 31, 2025 primarily reflected the divestitures of the warehouse automation and European roto-gravure packaging and tooling and flexographic print businesses, the impact of foreign currency fluctuations during the period and additional amortization.

Amortization expense on intangible assets was $ 2,966 and $ 8,608 for the three-month periods ended December 31, 2025 and 2024, respectively.

The net change in intangible assets during the six months ended March 31, 2026 primarily reflected the divestitures of the warehouse automation and European roto-gravure packaging and tooling and flexographic print businesses, the impact of foreign currency fluctuations during the period and additional amortization.

Amortization expense on intangible assets was $ 2,674 and $ 4,280 for the three-month periods ended March 31, 2026 and 2025, respectively.

Amortization expense on intangible assets was $ 5,640 and $ 12,888 for the six months ended March 31, 2026 and 2025, respectively.

The fiscal 2026 decrease in intangible amortization reflected lower amortization following the Company's fiscal 2025 divestiture of its interest in the SGK Business.

Amortization expense is estimated to be $ 7,206 for the remainder of fiscal 2026, $ 6,710 in 2027, $ 5,222 in 2028, $ 4,543 in 2029 and $ 4,159 in 2030.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Legal Matters

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

Given the Court’s favorable ruling, the matter filed by Tesla has been effectively stayed pending arbitration, which Tesla has initiated.

The Company maintains the claims alleged in the complaint are without merit and continues to vigorously defend itself against the allegations in confidential arbitration.

In addition, on February 13, 2025, Tesla filed another additional complaint against the Company in the United States District Court for the Northern District of California alleging, in part, claims related to correction of inventorship, breach of contract, promissory estoppel and quasi-contract/restitution arising from and/or related to various U.S.

Tesla initiated that arbitration on November 8, 2024.

On February 13, 2026, the arbitrator entered an interim decision addressing liability on certain of Tesla’s claims, finding Tesla had established liability on only a limited subset of its claims.

The amount of potential damages, if any, will be determined in future phases of the arbitration.

The interim decision provided additional clarity regarding the Company’s ongoing dispute with Tesla and clarified the Company’s ownership of and rights in certain dry battery electrode (“DBE”) technology that the Company has been developing over the past two decades.

The interim decision includes a narrow injunction preventing the Company from using certain parts in DBE machines.

The Company already has approved replacement parts, and thus the injunction has not materially impeded its operations or sales.

Tesla has moved to confirm the injunction before the United States District Court for the Northern District of California.

The Company has opposed Tesla’s petition to confirm the injunction as premature and has in the alternative cross-moved for an order partially vacating the injunction.

Additional phases of the arbitration remain pending.

In addition, on February 13, 2025, Tesla filed a separate complaint against the Company in the United States District Court for the Northern District of California alleging, in part, claims related to correction of inventorship, breach of contract, promissory estoppel and quasi-contract/restitution arising from and/or related to various U.S.

patents and provisional patents, including but not limited to U.S.

Similar to the prior matter, this case has also recently been compelled to confidential arbitration by the United States District Court for the Northern District of California.

The Company maintains the claims are without merit and intends to vigorously defend itself against the allegations if the matter is reinitiated by Tesla in confidential arbitration.

The Company is also defending a separate new confidential arbitration demand, initiated by Tesla on September 8, 2025, which alleges claims for breach of express warranty, declaratory relief, and breach of contract.

Similar to the prior matter, this case has also been compelled to confidential arbitration by the United States District Court for the Northern District of California.

Tesla filed a confidential arbitration demand on February 10, 2026, which included the above-referenced claims as well as claims for trade secret misappropriation.

The Company maintains the claims are without merit and intends to vigorously defend itself against the allegations as the confidential arbitration proceeds.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued

(Dollar amounts in thousands, except per share data)

Legal Matters (continued)

The Company is also defending an additional separate confidential arbitration demand, initiated by Tesla on September 8, 2025, which alleges claims for breach of express warranty, design defects in manufacturing, declaratory relief, and breach of contract.

The arbitration demand seeks declaratory relief and actual damages, plus interest and costs.

An estimate of the possible loss or range of loss related to the foregoing matters cannot be made at this time given the continued lack of specificity in the pending proceedings and/or the applicable pleadings.

In light of the substantial harm caused to the Company by Tesla's actions, the Company is now pursuing counterclaims against Tesla.

In light of the substantial harm caused to the Company by Tesla's actions, the Company is also pursuing counterclaims against Tesla.

On October 1, 2025, Judge Edward Davila, a federal court judge from the United States District Court for the Northern District of California, issued an opinion and order granting Matthews’ petition to confirm a prior confidential arbitration award, and rejected Tesla’s motion to vacate that same arbitration award.

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Finally, in October 2025, the Company finalized a confidential settlement agreement resolving claims of alleged copyright infringement arising from a legacy licensing arrangement within the Company's Memorialization segment.

The settlement amount of $ 8,000 , which was accrued and recognized as a component of administrative expense for the period ended September 30, 2025, and was paid during the first quarter of fiscal 2026.

The settlement amount of $ 8,000 , which was accrued and recognized as a component of administrative expense for the period ended September 30, 2025, was paid during the first quarter of fiscal 2026.

The Company denies fault or wrongdoing in the matter arising from this licensing dispute.

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Such administrative support fees are intended to approximate the underlying cost of providing such services for Propelis.

During the first quarter of fiscal 2026, the Company recognized $ 2,495 of administrative support fees under the TSA, which were included as a component of administrative expense.

Sales to and purchase from Propelis were immaterial for the three months ended December 31, 2025.

Amounts due from Matthews to Propelis were insignificant as of December 31, 2025.

During the three and six-month periods ended March 31, 2026, the Company recognized $ 1,415 and $ 3,910 , respectively, of administrative support fees under the TSA, which were included as a component of administrative expense.

Sales to and purchases from Propelis were immaterial for the three and six-month periods ended March 31, 2026.

Amounts due from Matthews to Propelis totaled $ 5,284 as of March 31, 2026, which reflected net transactional amounts pending settlement under the TSA.

Such amounts were included as a component of trade accounts payable.

Amounts due to Matthews from Propelis totaled $ 3,971 as of September 30, 2025, which reflected outstanding administrative fees, and net transactional amounts pending settlement under the TSA.

Such amounts were included as a component of accounts receivable.

Subsequent Event

On January 22, 2026, subsequent to the date of the balance sheet, the Company redeemed all of its outstanding 2027 Senior Secured Notes.

Refer to Note 8, "Debt and Financing Arrangements" for further information.

Management's Discussion and Analysis of Financial Condition and Results of Operations

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Any forward-looking statements contained herein are included pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include, but are not limited to, statements regarding the expectations, hopes, beliefs, intentions or strategies of the Company regarding the future, including statements regarding the anticipated benefits and risks associated with the joint venture transaction with Peninsula Parent LLC, d.b.a.

Propelis Group ("Propelis") and the timing thereof, and may be identified by the use of words such as “expects,” “believes,” “intends,” “projects,” “anticipates,” “estimates,” “plans,” “seeks,” “forecasts,” “predicts,” “objective,” “targets,” “potential,” “outlook,” “may,” “will,” “could” or the negative of these terms, other comparable terminology and variations thereof.

These forward-looking statements include, but are not limited to, statements regarding the expectations, hopes, beliefs, intentions or strategies of the Company regarding the future, and may be identified by the use of words such as “expects,” “believes,” “intends,” “projects,” “anticipates,” “estimates,” “plans,” “seeks,” “forecasts,” “predicts,” “objective,” “targets,” “potential,” “outlook,” “may,” “will,” “could” or the negative of these terms, other comparable terminology and variations thereof.

Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to be materially different from management's expectations, and no assurance can be given that such expectations will prove correct.

Factors that could cause the Company's results to differ materially from the results discussed in such forward-looking statements principally include risks to our ability to achieve the anticipated benefits of the joint venture transaction with Propelis that closed in fiscal year 2025, changes in domestic or international economic conditions, changes in foreign currency exchange rates, changes in interest rates, changes in the cost of materials used in the manufacture of the Company's products, including changes in costs due to adjustments to tariffs, any impairment of goodwill or intangible assets, environmental liability and limitations on the Company’s operations due to environmental laws and regulations, disruptions to certain services, such as telecommunications, network server maintenance, cloud computing or transaction processing services, provided to the Company by third-parties, changes in mortality and cremation rates, changes in product demand or pricing as a result of consolidation in the industries in which the Company operates, or other factors such as supply chain disruptions, labor shortages or labor cost increases, changes in product demand or pricing as a result of domestic or international competitive pressures, ability to achieve cost-reduction objectives, unknown risks in connection with the Company's acquisitions, divestitures, and business combinations, cybersecurity concerns and costs arising with management of cybersecurity threats, effectiveness of the Company's internal controls, compliance with domestic and foreign laws and regulations, technological factors beyond the Company's control, impact of pandemics or similar outbreaks, or other disruptions to our industries, customers, or supply chains, the impact of global conflicts, such as the current war between Russia and Ukraine, and conflicts and related sanctions or trade restrictions involving Venezuela, the Company's plans and expectations with respect to its exploration, and contemplated execution, of various strategies with respect to its portfolio of businesses, the Company's plans and expectations with respect to its Board of Directors, and other factors described in Item 1A - "Risk Factors" in this Form 10-Q and Item 1A - "Risk Factors" in the Company's Form 10-K for the fiscal year ended September 30, 2025.

Propelis Group ("Propelis"), changes in domestic or international economic conditions, changes in foreign currency exchange rates, changes in interest rates, changes in the cost of materials used in the manufacture of the Company's products, including changes in costs due to adjustments to tariffs or supply chain disruptions, any impairment of goodwill or intangible assets, environmental liability and limitations on the Company’s operations due to environmental laws and regulations, disruptions to certain services, such as telecommunications, network server maintenance, cloud computing or transaction processing services, provided to the Company by third-parties, changes in mortality and cremation rates, changes in product demand or pricing as a result of consolidation in the industries in which the Company operates, or other factors such as labor shortages or labor cost increases, changes in product demand or pricing as a result of domestic or international competitive pressures, ability to achieve cost-reduction objectives, unknown risks in connection with the Company's acquisitions, divestitures, and business combinations, cybersecurity concerns and costs arising with management of cybersecurity threats, effectiveness of the Company's internal controls, compliance with domestic and foreign laws and regulations, technological factors beyond the Company's control, impact of pandemics or similar outbreaks, or other disruptions to our industries, customers, or supply chains, the impact of global conflicts, such as the current war between Russia and Ukraine and hostilities in the Middle East, and conflicts and related sanctions or trade restrictions involving Venezuela, the Company's plans and expectations with respect to its exploration, and contemplated execution, of various strategies with respect to its portfolio of businesses, the Company's plans and expectations with respect to its Board of Directors, and other factors described in Item 1A - "Risk Factors" in this Form 10-Q and Item 1A - "Risk Factors" in the Company's Form 10-K for the fiscal year ended September 30, 2025.

In addition, although the Company does not currently have any customers that would be considered individually significant to consolidated sales, changes in the distribution of the Company's products or the potential loss of one or more of the Company's larger customers are also considered risk factors.

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

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On December 31, 2025, the Company sold its warehouse automation business for cash and other consideration.

On December 31, 2025, the Company sold its warehouse automation business for cash consideration.

Following the completion of these transactions, the Company's Industrial Technologies segment consists of product identification, and the design, manufacturing, service and sales of high-tech custom energy storage solutions including coating and converting lines, and the Company's Brand Solutions segment consists of its 40% ownership interest in Propelis.

Activity prior to May 1, 2025 for the SGK Business is included within the consolidated financial statements of the Company.

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Consequently, in fiscal 2026, the Company's portion of earnings for its equity-method investment in Propelis includes the months of July, August and September 2025.

For the six months ended March 31, 2026, the Company's portion of earnings (losses) for its equity-method investment in Propelis includes the months from July 2025 through December 2025.

See Notes 7, "Investments" and 16, "Acquisitions and Divestitures" in Item 1 - "Financial Statements" for further information.

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In addition, adjusted EBITDA does not include depreciation, intangible amortization, interest expense and other items incurred by Propelis.

Reportable Segments adjusted EBITDA is also determined before corporate and non-operating expenses.

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Management does not allocate non-operating items such as investment income, other income (deductions), net and noncontrolling interest to the segments.

The following table sets forth the sales and adjusted EBITDA for the Company's three reporting segments for the three-month periods ended December 31, 2025 and 2024.

Management's Discussion and Analysis of Financial Condition and Results of Operations, Continued

The following table sets forth the sales and adjusted EBITDA for the Company's three reporting segments for the three and six-month periods ended March 31, 2026 and 2025.

Refer to Note 15, "Segment Information" in Item 1 - "Financial Statements" for the Company's financial information by segment.

Net income was $43.6 million compared to a net loss of $3.5 million for the three months ended December 31, 2025 and 2024, respectively.

Net loss was $21.8 million compared to a net loss of $8.9 million for the three months ended March 31, 2026 and 2025, respectively, and net income was $21.8 million compared to a net loss of $12.4 million for the six months ended March 31, 2026 and 2025, respectively.

Refer to "Non-GAAP Financial Measures" below for a reconciliation of net income to adjusted EBITDA.

Management's Discussion and Analysis of Financial Condition and Results of Operations, Continued

Three Months Ended

March 31, Six Months Ended

2026 2025 2026 2025

(Dollar amounts in thousands)

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See the "Non-GAAP Financial Measures" section below.

Sales for the three months ended December 31, 2025 were $284.8 million, compared to $401.8 million for the three months ended December 31, 2024.

The decrease in fiscal 2026 sales reflected a sales reduction of $115.3 million resulting from the divestiture of the Company's interest in the SGK Business on May 1, 2025 (see Acquisitions and Divestitures below).

The fiscal 2026 change in sales also reflected higher sales in the Memorialization segment, partially offset by lower sales in the Industrial Technologies segment.

Sales for the six months ended March 31, 2026 were $543.4 million, compared to $829.5 million for the six months ended March 31, 2025.

The decrease in fiscal 2026 sales primarily reflected a sales reduction of $241.9 million resulting from the divestiture of the Company's interest in the SGK Business on May 1, 2025.

Additionally, other recent acquisitions and divestitures had a net unfavorable impact of $23.3 million on fiscal 2026 sales compared to the prior year (see Acquisitions and Divestitures below).

The fiscal 2026 change in sales also reflected lower sales in the Industrial Technologies segment.

On a consolidated basis, changes in foreign currency exchange rates were estimated to have a favorable impact of $7.5 million on fiscal 2026 sales compared to the prior year.

Memorialization segment sales for the first three months of fiscal 2026 were $204.2 million, compared to $190.5 million for the first three months of fiscal 2025.

Memorialization segment sales for the first six months of fiscal 2026 were $419.4 million, compared to $396.1 million for the first six months of fiscal 2025.

The sales increase principally reflected inflationary price realization and the favorable impact of the fiscal 2025 acquisition of The Dodge Company (see Acquisitions and Divestitures below).

These increases were partially offset by lower sales of cremation equipment and mausoleums.

Industrial Technologies segment sales were $69.0 million for the first three months of fiscal 2026, compared to $80.5 million for the first three months of fiscal 2025.

The decrease in sales reflected lower sales of purpose-built engineered products (primarily energy storage solutions for the electric vehicle market and coating and converting equipment), and the impact of divesting the Company's tooling business in December 2025 (see Acquisitions and Divestitures below).

These declines were partially offset by increased sales of warehouse automation solutions.

These increases were partially offset by lower sales of caskets, cremation equipment, mausoleums, and cemetery memorials.

Changes in foreign currency exchange rates had a favorable impact of $1.5 million on the segment's sales compared to the prior year.

Industrial Technologies segment sales were $112.4 million for the first six months of fiscal 2026, compared to $161.4 million for the first six months of fiscal 2025.

The decrease in sales reflected lower sales of purpose-built engineered products (primarily energy storage solutions for the electric vehicle market and coating and converting equipment), the impact of divesting the Company's warehouse automation and tooling businesses in December 2025 (see Acquisitions and Divestitures below), and lower tooling sales for the fiscal 2026 period prior to the divestiture.

These declines were partially offset by higher product identification sales, and increased sales of warehouse automation solutions for the fiscal 2026 period prior to the divestiture.

Fiscal 2026 sales for the Industrial Technologies segment were impacted by customer delays impacting the timing of projects within the energy storage business.

Changes in foreign currency exchange rates had a favorable impact of $6.0 million on the segment's sales compared to the prior year.

In the Brand Solutions segment, sales for the first three months of fiscal 2026 were $11.6 million, compared to $130.8 million for the first three months of fiscal 2025.

The decrease in sales primarily reflected the divestiture of the Company's interest in the SGK Business on May 1, 2025.

Fiscal 2026 segment sales reflected sales for the European cylinders (packaging) business through December 1, 2025, at which time this business was divested (see Acquisitions and Divestitures below).

Changes in foreign currency exchange rates had an unfavorable impact of $804,000 on the segment's sales compared to the prior year.

Gross profit for the three months ended December 31, 2025 was $99.7 million, compared to $125.7 million for the same period a year ago.

In the Brand Solutions segment, sales for the first six months of fiscal 2026 were $11.6 million, compared to $272.0 million for the first six months of fiscal 2025.

The decrease in sales primarily reflected the divestiture of the Company's interest in the SGK Business on May 1, 2025, and the divestitures of the Company's European roto-gravure packaging and flexographic print businesses in December 2025 (see Acquisitions and Divestitures below).

Fiscal 2026 segment sales reflected sales for the European packaging and print businesses for the period prior to the divestitures.

Gross profit for the six months ended March 31, 2026 was $201.7 million, compared to $269.8 million for the same period a year ago.

The decrease in gross profit reflected a reduction of $57.4 million resulting from the fiscal 2025 divestiture of the Company's interest in the SGK Business.

The gross profit decline also reflected the impact of higher material and labor costs, and lower sales and margins on engineered products.

These decreases were partially offset by the impact of improved price realization, benefits from the realization of productivity improvements and other cost-reduction initiatives, and the favorable impact of the Dodge acquisition within the Memorialization segment.

Gross profit also included acquisition integration costs and other charges primarily in connection with cost-reduction initiatives totaling $1.3 million and $1.1 million for the three months ended December 31, 2025 and 2024, respectively.

Selling and administrative expenses for the three months ended December 31, 2025 were $112.4 million, compared to $111.4 million for the same period last year.

Consolidated selling and administrative expenses, as a percent of sales, were 39.5% for the three months ended December 31, 2025, compared to 27.7% for the same period last year.

Selling and administrative expenses in fiscal 2026 reflected benefits from ongoing cost-reduction initiatives, and an $18.5 million reduction in selling and administrative expenses from the fiscal 2025 divestiture of the Company's interest in the SGK Business, partially offset by higher compensation costs.

Selling and administrative expenses included legal costs related to an ongoing dispute with Tesla,

The gross profit decline also reflected the impact of higher material, labor, and other production costs, lower sales and margins on engineered products, and the impact of divesting the Company's warehouse automation and European roto-gravure packaging and tooling and flexographic print businesses in December 2025.

Management's Discussion and Analysis of Financial Condition and Results of Operations, Continued

decreases were partially offset by the impact of improved price realization, benefits from the realization of productivity improvements and other cost-reduction initiatives, and the favorable impact of the fiscal 2025 acquisition of The Dodge Company.

Gross profit also included acquisition integration costs and other charges primarily in connection with cost-reduction initiatives totaling $1.8 million and $338,000 for the six months ended March 31, 2026 and 2025, respectively.

Selling and administrative expenses for the six months ended March 31, 2026 were $210.9 million, compared to $243.2 million for the same period last year.

Consolidated selling and administrative expenses, as a percent of sales, were 38.8% for the six months ended March 31, 2026, compared to 29.3% for the same period last year.

Selling and administrative expenses in fiscal 2026 reflected benefits from ongoing cost-reduction initiatives, and a $37.4 million reduction in selling and administrative expenses from the fiscal 2025 divestiture of the Company's interest in the SGK Business, partially offset by higher compensation costs.

Selling and administrative expenses included legal costs related to an ongoing dispute with Tesla, Inc.

("Tesla") totaling $11.2 million in fiscal 2026 and $8.6 million in fiscal 2025 (see Legal Matters below).

Selling and administrative expenses included activist shareholder/contested proxy costs totaling $2.5 million in fiscal 2026 and $4.9 million in fiscal 2025.

Selling and administrative expenses included fees for receivables sold under a receivables purchase agreement and factoring arrangement totaling $1.1 million in fiscal 2026 and $2.3 million in fiscal 2025.

Fiscal 2026 selling and administrative expenses included $11.6 million of equity-method losses for the Company's equity-method investment in Propelis.

See Note 7, "Investments" in Item 1 - "Financial Statements" for further information.

Fiscal 2025 selling and administrative expenses included $11.5 million of expenses related to the fiscal 2025 divestiture of the Company's interest in the SGK Business, $8.7 million of net gains on the sales of certain significant property and other assets, and a $2.1 million loss on a small divestiture in the Industrial Technologies segment.

Selling and administrative expenses also included acquisition integration and related systems-integration costs, and other charges primarily in connection with certain commercial, operational and cost-reduction initiatives totaling $7.4 million in fiscal 2026, compared to $4.7 million in fiscal 2025.

Intangible amortization for the six months ended March 31, 2026 was $5.6 million, compared to $12.9 million for the six months ended March 31, 2025.

The fiscal 2026 decrease in intangible amortization primarily reflected lower amortization following the Company's fiscal 2025 divestiture of its interest in the SGK Business.

During the first six months of fiscal 2026, the Company recognized $109.3 million of net pre-tax gains on divestitures (see Acquisitions and Divestitures below).

Adjusted EBITDA for the six months ended March 31, 2026 was $80.0 million, compared to $91.4 million for the six months ended March 31, 2025.

Memorialization segment adjusted EBITDA was $87.8 million for the first six months of fiscal 2026, compared to $81.7 million for the first six months of fiscal 2025.

The increase in segment adjusted EBITDA reflected the impact of improved price realization, benefits from productivity initiatives, and the favorable impact of the fiscal 2025 acquisition of The Dodge Company.

These increases were partially offset by the impact of higher material, labor, and other production costs.

Adjusted EBITDA for the Industrial Technologies segment was a loss of $7.8 million for the six months ended March 31, 2026 compared to income of $7.9 million for the six months ended March 31, 2025.

The decrease in segment adjusted EBITDA reflected the impact of lower sales and margins on engineered products, lower product identification margins, the impact of divesting the Company's warehouse automation business in December 2025, and unfavorable sales mix for warehouse automation solutions for the fiscal 2026 period prior to the divestiture.

These declines were partially offset by benefits from cost-reduction initiatives and lower performance-based compensation compared to fiscal 2025.

Adjusted EBITDA for the Brand Solutions segment was $22.3 million for the first six months of fiscal 2026, compared to $27.9 million for the same period a year ago.

The decrease in segment adjusted EBITDA primarily reflected a reduction of $28.3 million resulting from the fiscal 2025 divestiture of the Company's interest in the SGK Business, partially offset by the inclusion of the Company's portion (40% ownership interest) of Propelis' adjusted EBITDA, which totaled $22.4 million in fiscal 2026.

See Notes 7, "Investments" and 16, "Acquisitions and Divestitures" in Item 1 - "Financial Statements" for further information.

Interest expense for the first six months of fiscal 2026 was $24.7 million, compared to $31.5 million for the same period during the last fiscal year.

The decrease in interest expense reflected lower average borrowing levels and lower average interest rates in the current fiscal year.

During the second quarter of fiscal 2026, the Company recognized $16.3 million of debt extinguishment charges in connection with the redemption of the Company's 2027 Senior Secured Notes (see Liquidity and Capital Resources below).

Other income (deductions), net, for the six months ended March 31, 2026 represented an increase in pre-tax income of $3.0 million, compared to an increase in pre-tax income of $2.5 million for the same period last year.

Other income (deductions), net includes investment income, banking-related fees and the impact of currency gains and losses on certain intercompany debt and foreign denominated cash balances.

Fiscal 2026 other income (deductions), net included $2.5 million of paid-in-kind interest income related to the Company's preferred equity investment in Propelis.

Fiscal 2025 other income (deductions), net included loss recoveries totaling $1.2 million which were related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.

Management's Discussion and Analysis of Financial Condition and Results of Operations, Continued

Income tax provisions for the Company's interim periods are based on the effective income tax rate expected to be applicable for the full year.

The Company's consolidated income taxes for the first six months of fiscal 2026 represented an expense of $34.6 million, compared to a benefit of $5.1 million for the first six months of fiscal 2025.

The Company’s fiscal 2026 six month effective tax rate varied from the U.S.

The Company’s fiscal 2025 six month effective tax rate varied from the U.S.

statutory tax rate of 21.0% primarily due to state taxes, tax credits, non-tax benefited foreign losses, and other net discrete tax benefits.

Legal Matters

Refer to Note 18, "Legal Matters" in Item 1 - "Financial Statements" for information regarding the settlement of a contractual licensing matter within the Memorialization segment, and details related to an ongoing dispute with Tesla.

Related Party Transactions

Refer to Note 19, "Related Party Transactions" in Item 1 - "Financial Statements" for information regarding transactions with Propelis.

NON-GAAP FINANCIAL MEASURES:

Included in this report are measures of financial performance that are not defined by GAAP.

The Company uses certain non-GAAP financial measures to assist in comparing its performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect the Company’s core operations including acquisition and divestiture costs, gains and losses on divestitures, ERP system integration costs, strategic initiatives and other charges (which includes non-recurring charges related to certain commercial and operational initiatives and exit activities), stock-based compensation and the non-service portion of pension and postretirement expense.

Management believes that presenting non-GAAP financial measures is useful to investors because it (i) provides investors with meaningful supplemental information regarding financial performance by excluding certain items that management believes do not directly reflect the Company's core operations, (ii) permits investors to view performance using the same tools that management uses to budget, forecast, make operating and strategic decisions, and evaluate historical performance, and (iii) otherwise provides supplemental information that may be useful to investors in evaluating the Company’s results.

The Company believes that the presentation of these non-GAAP financial measures, when considered together with the corresponding GAAP financial measures and the reconciliations to those measures, provided herein, provides investors with an additional understanding of the factors and trends affecting the Company’s business that could not be obtained absent these disclosures.

The Company believes that adjusted EBITDA provides relevant and useful information, which is used by the Company’s management in assessing the performance of its business.

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, gains and losses on divestitures, ERP system integration costs, and strategic initiatives and other charges.

In addition, adjusted EBITDA does not include depreciation, intangible amortization, interest expense and other items incurred by Propelis.

Adjusted EBITDA provides the Company with an understanding of earnings before the impact of investing and financing charges and income taxes, and the effects of certain acquisition and divestiture and ERP system integration costs, and items that do not reflect the ordinary earnings of the Company’s operations.

This measure may be useful to an investor in evaluating operating performance.

It is also useful as a financial measure for lenders and is used by the Company’s management to measure business performance.

Adjusted EBITDA is not a measure of the Company's financial performance under GAAP and should not be considered as an alternative to net income or other performance measures derived in accordance with GAAP, or as an alternative to cash flow from operating activities as a measure of the Company's liquidity.

The Company's definition of adjusted EBITDA may not be comparable to similarly titled measures used by other companies.

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