What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-11 compared with 2025-05-09 · 184 added, 107 removed, 597 unchanged (33% of the section changed)

4 unchanged sentences

( in thousands, except share and per share data )

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

ASSETS (unaudited)

40 unchanged sentences

( in thousands, except per share data )

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Revenue $ 185,405 $ 189,773 $ 347,020 $ 374,215

5 unchanged sentences

Environmental expense 518 — 1,058 —

Legal settlement and insurance recoveries, net — 60 — 60

Research and engineering 269 231 568 575

Depreciation and amortization 1,986 2,391 4,312 4,839

(Loss) income from operations ( 1,012 ) 5,553

Income from operations 8,428 11,959 7,416 17,511

Interest expense 4,239 4,413 7,563 8,842

(Loss) income before (benefit) provision for income taxes ( 4,336 ) 1,123

(Benefit) provision for income taxes ( 1,168 ) 119

Net (loss) income ( 3,168 ) 1,004

Income (loss) before provision (benefit) for income taxes 4,189 7,546 ( 147 ) 8,669

Provision (benefit) for income taxes 1,063 1,173 ( 105 ) 1,292

Net income (loss) 3,126 6,373 ( 42 ) 7,377

net income attributable to noncontrolling interests, net of taxes 109 4 127 13

Net (loss) income attributable to Mistras Group, Inc.

Net income (loss) attributable to Mistras Group, Inc.

$ 3,017 $ 6,369 $ ( 169 ) $ 7,364

Net (loss) income per common share

Net income (loss) per common share

Basic $ 0.10 $ 0.21 $ — $ 0.24

8 unchanged sentences

(in thousands )

Three months ended March 31,

Net (loss) income $ ( 3,168 ) $ 1,004

Other comprehensive loss:

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Net income (loss) $ 3,126 $ 6,373 $ ( 42 ) $ 7,377

Other comprehensive income:

Foreign currency translation adjustments $ 11,739 $ ( 1,616 ) $ 14,212 $ ( 5,845 )

Comprehensive Loss ( 695 ) ( 3,225 )

Comprehensive income 14,865 4,757 14,170 1,532

net income attributable to noncontrolling interest 109 4 127 13

Foreign currency translation adjustments attributable to noncontrolling interests ( 118 ) — ( 127 ) —

Comprehensive loss attributable to Mistras Group, Inc.

Comprehensive income attributable to Mistras Group, Inc.

$ 14,874 $ 4,753 $ 14,170 $ 1,519

12 unchanged sentences

Shares Amount Total Equity

Balance at March 31, 2025 31,326 $ 406 $ 251,629 $ ( 13,170 ) $ ( 40,200 ) $ 198,665 $ 336 $ 199,001

Net income — — — 3,017 — 3,017 109 3,126

Other comprehensive income (loss), net of tax — — — — 11,857 11,857 ( 118 ) 11,739

Share-based payments — — 2,323 — — 2,323 — 2,323

Net settlement of restricted stock units 212 59 ( 73 ) — — ( 14 ) — ( 14 )

Balance at June 30, 2025 31,538 $ 465 $ 253,879 $ ( 10,153 ) $ ( 28,343 ) $ 215,848 $ 327 $ 216,175

Balance at March 31, 2024 30,911 $ 328 $ 247,329 $ ( 27,947 ) $ ( 32,565 ) $ 187,145 $ 320 $ 187,465

Net income — — — 6,369 — 6,369 4 6,373

Other comprehensive loss, net of tax — — — — ( 1,616 ) ( 1,616 ) — ( 1,616 )

Share-based payments — — 1,536 — — 1,536 — 1,536

Net settlement of restricted stock units 66 57 ( 341 ) — — ( 284 ) — ( 284 )

Balance at June 30, 2024 30,977 $ 385 $ 248,524 $ ( 21,578 ) $ ( 34,181 ) $ 193,150 $ 324 $ 193,474

Six months ended

Common stock Additional

paid-in capital Accumulated

deficit Accumulated

comprehensive loss Total

Mistras Group,

stockholders’ equity Non-controlling interests

Shares Amount Total Equity

Balance at December 31, 2024 31,010 $ 402 $ 250,832 $ ( 9,984 ) $ ( 42,682 ) $ 198,568 $ 327 $ 198,895

Net loss — — — ( 169 ) — ( 169 ) 127 ( 42 )

Other comprehensive loss, net of tax — — — — 2,482 2,482 ( 9 ) 2,473

Other comprehensive income (loss), net of tax — — — — 14,339 14,339 ( 127 ) 14,212

Share-based payments — — 4,602 — — 4,602 — 4,602

Net settlement of restricted stock units 528 63 ( 1,555 ) — — ( 1,492 ) — ( 1,492 )

Balance at March 31, 2025 31,326 $ 406 $ 251,629 $ ( 13,170 ) $ ( 40,200 ) $ 198,665 $ 336 $ 199,001

Balance at June 30, 2025 31,538 $ 465 $ 253,879 $ ( 10,153 ) $ ( 28,343 ) $ 215,848 $ 327 $ 216,175

Balance at December 31, 2023 30,598 $ 305 $ 247,165 $ ( 28,942 ) $ ( 28,336 ) $ 190,192 $ 311 $ 190,503

Net income — — — 7,364 — 7,364 13 7,377

Other comprehensive income, net of tax — — — — ( 4,229 ) ( 4,229 ) — ( 4,229 )

Other comprehensive loss, net of tax — — — — ( 5,845 ) ( 5,845 ) — ( 5,845 )

Share-based payments — — 2,764 — — 2,764 — 2,764

Net settlement of restricted stock units 379 80 ( 1,405 ) — — ( 1,325 ) — ( 1,325 )

Balance at March 31, 2024 30,911 $ 328 $ 247,329 $ ( 27,947 ) $ ( 32,565 ) $ 187,145 $ 320 $ 187,465

Balance at June 30, 2024 30,977 $ 385 $ 248,524 $ ( 21,578 ) $ ( 34,181 ) $ 193,150 $ 324 $ 193,474

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

3 unchanged sentences

(In Thousands)

Three months ended March 31,

Six months ended June 30,

Cash flows from operating activities

14 unchanged sentences

Income taxes payable ( 402 ) 136

Net cash provided by operating activities 5,645 604

Net cash (used in) provided by operating activities ( 3,619 ) 5,115

Cash flows from investing activities

9 unchanged sentences

Taxes paid related to net share settlement of share-based awards ( 1,492 ) ( 1,326 )

Net cash (used in) provided by financing activities ( 702 ) 5,127

Net cash provided by financing activities 14,910 5,261

Effect of exchange rate changes on cash and cash equivalents 1,765 372

32 unchanged sentences

Recent Developments

We may experience increased costs associated with tariffs or trade barriers (including recent U.S.

We may continue to experience increased costs associated with tariffs or trade barriers, including recent U.S.

tariffs imposed or threatened to be imposed on China, Canada, Mexico and other countries and any retaliatory actions taken by such countries.

The Company will continue to monitor market conditions and respond accordingly.

We will continue to monitor market conditions and respond accordingly.

Basis of Presentation

21 unchanged sentences

Change in Classification of Certain Expenses from Selling, General and Administrative Expenses to Cost of Revenue

During the period from January 1, 2025 through March 31, 2025, the Company changed the presentation of certain costs incurred at its operational labs as well as the costs for certain personnel that indirectly support the Company’s delivery of services on its Unaudited Condensed Consolidated Statements of Income (Loss).

Beginning on January 1, 2025, the Company changed the presentation of certain costs on its Unaudited Condensed Consolidated Statements of Income (Loss), which include costs incurred at the Company's operational labs as well as the costs for certain personnel that indirectly support the Company’s delivery of services.

This voluntary change in classification of certain overhead and personnel costs, which were determined to be directly related to the Company’s delivery of services, resulted in a decrease in Selling, general and administrative expenses and an offsetting increase in Cost of revenue.

5 unchanged sentences

In addition, Selling, general and administrative expenses and Other Expenses information disclosed in Note 14 Segment Disclosure was updated for this change.

The impacts of the update to the presentation of certain indirect costs on the Company’s Condensed Consolidated Financial Statements for the three months ended March 31, 2025 and 2024 are reflected below under the "Effect of change" columns .

Three Months Ended March 31, 2025

Prior Presentation Method Effect of change As Reported

The impacts of the update to the presentation of certain indirect costs on the Company’s Condensed Consolidated Financial Statements for the three and six month periods ended June 30, 2024 are reflected below under the "Effect of change" columns .

Three Months Ended June 30, 2024

As Previously Reported Effect of change As Adjusted

Cost of revenue $ 127,760 $ 4,776 $ 132,536

1 unchanged sentence

Selling, general and administrative expenses 40,957 ( 4,776 ) 36,181

Three Months Ended March 31, 2024

Six Months Ended June 30, 2024

As Previously Reported Effect of change As Adjusted

16 unchanged sentences

A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the current and prior years.

As of March 31, 2025, management concluded that it is more likely than not that a substantial portion of the Company's deferred tax assets will be realized.

As of June 30, 2025, management concluded that it is more likely than not that a substantial portion of the Company's deferred tax assets will be realized.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.

The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution.

The Company’s effective income tax rate was approximately 26.9 % and 10.6 % for the three months ended March 31, 2025 and 2024, respectively.

The effective income tax rate benefit for the three months ended March 31, 2025 was higher than the statutory rate primarily due to the impact of a favorable discrete item related to stock compensation.

The Company’s effective income tax rate was approximately 25.4 % and 15.5 % for the three months ended June 30, 2025 and 2024, respectively.

The Company’s effective income tax rate was approximately 71.4 % and 14.9 % for the six months ended June 30, 2025 and 2024, respectively.

The effective income tax rate for the three months ended June 30, 2025, was higher than the statutory rate primarily due to the impact of a favorable discrete item related to stock compensation.

The effective income tax rate for the three months ended June 30, 2024, was lower than the statutory rate primarily due to the impact of a favorable discrete item related to stock compensation.

The effective income tax rate for the six months ended June 30, 2025, was higher than the statutory rate primarily due to the impact of a favorable discrete item related to stock compensation.

The effective income tax rate for the six months ended June 30, 2024, was lower than the statutory rate primarily due to the reversal of valuation allowances.

On July 4, 2025, H.R.1, commonly referred to as the One Big Beautiful Bill Act ("OBBBA"), was enacted, which includes a broad range of tax reform provisions.

We are currently evaluating the impact of the OBBBA.

Recent Accounting Pronouncements

6 unchanged sentences

We are currently evaluating the impacts this standard will have on our disclosures.

Mistras Group, Inc.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

On November 4, 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220):

10 unchanged sentences

and information about climate-related targets and goals.

The rules are effective on

Mistras Group, Inc.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

a rolling basis for various fiscal years, beginning for the Company with annual reports for the year ending December 31, 2025.

The rules are effective on a rolling basis for various fiscal years, beginning for the Company with annual reports for the year ending December 31, 2025.

However, in response to various legal challenges, the SEC voluntarily stayed the rules on April 4, 2024, which may impact the ultimate effective date of the rules.

19 unchanged sentences

The Company expects any significant remaining performance obligations to be satisfied within one year .

Mistras Group, Inc.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

Contract Estimates

8 unchanged sentences

Whenever revisions of estimates, contract costs and/or contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period.

Revenue by Category

The following series of tables present the Company's disaggregated revenue:

Revenue by industry was as follows:

Three Months Ended June 30, 2025 North America International Products & Systems Corp/Elim Total

Oil & Gas $ 92,634 $ 9,943 $ 239 $ — $ 102,816

Aerospace & Defense 16,848 7,014 140 — 24,002

Industrials 11,647 7,597 360 — 19,604

Power Generation & Transmission 9,320 2,097 376 — 11,793

Other Process Industries 5,877 5,172 — — 11,049

Infrastructure, Research & Engineering 3,461 4,020 579 — 8,060

Petrochemical 3,112 1 — — 3,113

Other 5,093 3,233 1,046 ( 4,404 ) 4,968

Total $ 147,992 $ 39,077 $ 2,740 $ ( 4,404 ) $ 185,405

Three Months Ended June 30, 2024 North America International Products & Systems Corp/Elim Total

Oil & Gas $ 96,356 $ 12,735 $ 165 $ — $ 109,256

Aerospace & Defense 16,596 5,697 47 — 22,340

Industrials 11,853 5,878 563 — 18,294

Power Generation & Transmission 7,332 1,254 447 — 9,033

Other Process Industries 10,368 4,504 37 — 14,909

Infrastructure, Research & Engineering 5,125 2,813 695 — 8,633

Petrochemical 3,848 171 — — 4,019

Other 4,916 1,212 1,419 ( 4,258 ) 3,289

Total $ 156,394 $ 34,264 $ 3,373 $ ( 4,258 ) $ 189,773

Mistras Group, Inc.

2 unchanged sentences

(tabular dollars and shares in thousands, except per share data)

Revenue by Category

The following series of tables present the Company's disaggregated revenue:

Revenue by industry was as follows:

Three Months Ended March 31, 2025 North America International Products & Systems Corp/Elim Total

Six Months Ended June 30, 2025 North America International Products & Systems Corp/Elim Total

Oil & Gas $ 178,365 $ 20,589 $ 426 $ — $ 199,380

7 unchanged sentences

Total $ 276,894 $ 72,291 $ 5,831 $ ( 7,996 ) $ 347,020

Three Months Ended March 31, 2024 North America International Products & Systems Corp/Elim Total

Six Months Ended June 30, 2024 North America International Products & Systems Corp/Elim Total

Oil & Gas $ 199,383 $ 22,801 $ 237 $ — $ 222,421

8 unchanged sentences

Revenue per key geographic location was as follows:

Three Months Ended March 31, 2025 North America International Products & Systems Corp/Elim Total

Three Months Ended June 30, 2025 North America International Products & Systems Corp/Elim Total

United States $ 129,011 $ 3,706 $ 1,268 $ ( 3,495 ) $ 130,490

3 unchanged sentences

Total $ 147,992 $ 39,077 $ 2,740 $ ( 4,404 ) $ 185,405

Three Months Ended March 31, 2024 North America International Products & Systems Corp/Elim Total

Three Months Ended June 30, 2024 North America International Products & Systems Corp/Elim Total

United States $ 130,870 $ 432 $ 1,542 $ ( 209 ) $ 132,635

3 unchanged sentences

Total $ 156,394 $ 34,264 $ 3,373 $ ( 4,258 ) $ 189,773

Six Months Ended June 30, 2025 North America International Products & Systems Corp/Elim Total

United States $ 243,344 $ 4,248 $ 2,641 $ ( 1,479 ) $ 248,754

Other Americas 30,617 2,846 228 ( 3,631 ) 30,060

Europe 1,645 63,914 1,201 ( 2,385 ) 64,375

Asia-Pacific 1,288 1,283 1,761 ( 501 ) 3,831

Total $ 276,894 $ 72,291 $ 5,831 $ ( 7,996 ) $ 347,020

Mistras Group, Inc.

2 unchanged sentences

(tabular dollars and shares in thousands, except per share data)

Six Months Ended June 30, 2024 North America International Products & Systems Corp/Elim Total

United States $ 260,328 $ 728 $ 3,142 $ ( 1,724 ) $ 262,474

Other Americas 41,721 4,216 852 ( 3,027 ) 43,762

Europe 1,764 59,846 1,231 ( 1,461 ) 61,380

Asia-Pacific 2,930 2,521 1,358 ( 210 ) 6,599

Total $ 306,743 $ 67,311 $ 6,583 $ ( 6,422 ) $ 374,215

Contract Balances

4 unchanged sentences

These assets and liabilities are aggregated on an individual contract basis and reported on the Consolidated Balance Sheets at the end of each reporting period within accounts receivable, net or accrued expenses and other current liabilities.

Revenue recognized during the three months ended March 31, 2025 and 2024 that was included in the contract liability balance at the beginning of the year was $ 3.3 million and $ 2.9 million, respectively.

Revenue recognized during the six months ended June 30, 2025 and 2024 that was included in the contract liability balance at the beginning of the year was $ 5.3 million and $ 4.8 million, respectively.

Changes in the contract asset and liability balances during these periods were not materially impacted by any other factors.

3 unchanged sentences

Awards granted under the 2016 Plan may be in the form of stock options, restricted stock units and other forms of share-based incentives, including performance-based restricted stock units, stock appreciation rights and deferred stock rights.

At the annual shareholders meeting on May 14, 2024, the Company’s shareholders approved an amendment to increase the total number of shares that may be issued under the 2016 Plan by 1.3 million, for a total of 6.2 million shares that are authorized for issuance under the 2016 Plan, of which approximately 665,000 shares were available for future grants as of March 31, 2025.

At the annual shareholders meeting on May 14, 2024, the Company’s shareholders approved an amendment to increase the total number of shares that may be issued under the 2016 Plan by 1.3 million, for a total of 6.2 million shares that are authorized for issuance under the 2016 Plan, of which approximately 823,000 shares were available for future grants as of June 30, 2025.

Stock Options

4 unchanged sentences

In addition, if Mr.

Stamatakis' employment ceases due to his termination by the Company without cause or his resignation with good reason then pursuant to his employment agreement with the Company, the vesting and exercisability of this stock option will also accelerate.

Stamatakis' employment ceases due to his termination by the Company without cause or his resignation with good reason, then pursuant to his employment agreement with the Company, the vesting and exercisability of this stock option will accelerate.

The outside expiration date of this stock option is the tenth anniversary of the Grant Date.

3 unchanged sentences

(tabular dollars and shares in thousands, except per share data)

The following table sets forth a summary of stock option activity, weighted-average exercise prices and options outstanding as of March 31, 2025 (in thousands, except per share amounts and years):

Three months ended March 31,

The following table sets forth a summary of stock option activity, weighted-average exercise prices and options outstanding as of June 30, 2025 (in thousands, except per share amounts and years):

Six Months Ended June 30,

Options Weighted

Price Common Stock Options Weighted Average Exercise Price

Outstanding at beginning of year:

Outstanding at beginning of period:

250 $ 5.36 250 $ 5.36

4 unchanged sentences

625 $ 7.58 250 $ 5.36

The Company recognized $ 0.5 million of share-based compensation expense within Reorganization and other costs related to the stock options granted in the first quarter of 2025 and $ 1.5 million of share-based compensation expense related to stock options remains unrecognized as of the end of the current period, which is all expected to be recognized during 2025.

The Company recognized $ 1.0 million of share-based compensation expense within Reorganization and other costs during the six months ended June 30, 2025 related to the stock options that were granted in the first quarter of 2025.

$ 1.0 million of share-based compensation expense related to stock options remains unrecognized as of the end of the current period, which is all expected to be recognized during 2025.

Stock Issuances to Non-Employee Directors

1 unchanged sentence

Prior to 2025, the shares of common stock were issued in semi-annual awards during the quarters ended March 31 and September 30.

In 2025, non-employee directors will receive a single award during the quarter ended June 30, 2025.

In 2025, non-employee directors received a single award during the quarter ended June 30, 2025.

A summary of the fully-vested common stock the Company issued to its non-employee directors, in connection with its non-employee director compensation, is as follows (in thousands):

Three months ended March 31,

Six months ended June 30,

Awards issued 72 31

1 unchanged sentence

Restricted Stock Unit Awards

For the three months ended March 31, 2025 and March 31, 2024, the Company recognized share-based compensation expense within Selling, general and administrative expenses related to restricted stock unit awards of $ 1.1 million and $ 1.0 million, respectively.

For the three months ended March 31, 2025, the Company recognized share-based compensation expense within Reorganization and other costs related to restricted stock unit awards of $ 0.5 million.

As of March 31, 2025, there was $ 8.8 million of unrecognized compensation costs, net of estimated forfeitures, related to restricted stock unit awards, which is expected to be recognized over a remaining weighted-average period of 2.5 years.

For the three months ended June 30, 2025 and June 30, 2024, the Company recognized share-based compensation expense within Selling, general and administrative expenses related to restricted stock unit awards of $ 0.9 million and $ 1.3 million, respectively.

For the six months ended June 30, 2025 and June 30, 2024, the Company recognized share-based compensation expense within Selling, general and administrative expenses related to restricted stock unit awards of $ 2.1 million and $ 2.3 million, respectively.

For the three months ended June 30, 2025, the Company recognized share-based compensation expense within Reorganization and other costs related to restricted stock unit awards of $ 0.5 million.

As of June 30, 2025, there was $ 7.1 million of unrecognized compensation costs related to restricted stock unit awards, which is expected to be recognized over a remaining weighted-average period of 2.6 years.

Upon vesting, restricted stock units are generally net share-settled to cover the required withholding tax and the remaining amount is converted into an equivalent number of shares of common stock.

A summary of the vesting activity of restricted stock unit awards, with the respective fair value of the awards, is as follows:

Three months ended March 31,

Six months ended June 30,

Restricted stock awards vested 589 461

5 unchanged sentences

A summary of the Company's outstanding, non-vested restricted share units is as follows:

Three months ended March 31,

Six months ended June 30,

Units Weighted

23 unchanged sentences

A summary of the Company's PRSU activity is as follows:

Three months ended March 31,

Six months ended June 30,

Units Weighted

8 unchanged sentences

493 $ 9.93 355 $ 9.00

For the three months ended March 31, 2025 and March 31, 2024, the Company recognized aggregate share-based compensation expense related to the awards described above of approximately $ 0.2 million and $ 0.1 million, respectively.

At March 31, 2025, there was $ 5.5 million of total unrecognized compensation costs related to approximately 620,000 non-vested PRSUs, which is expected to be recognized over a remaining weighted-average period of 3.2 years.

(Loss) earnings per Share

Basic (loss) earnings per share is computed by dividing net (loss) income by the weighted-average number of shares outstanding during the period.

Diluted (loss) earnings per share is computed by dividing net (loss) income by the sum of (1) the weighted-average number of shares of common stock outstanding during the period, and (2) the dilutive effect of assumed conversion of equity awards using the treasury stock method.

For the three months ended June 30, 2025 and June 30, 2024, the Company recognized aggregate share-based compensation expense related to the awards described above of approximately $ 0.4 million and $ 0.3 million, respectively.

For the six months ended June 30, 2025 and June 30, 2024, the Company recognized aggregate share-based compensation expense related to the awards described above of approximately $ 0.6 million and $ 0.3 million, respectively.

At June 30, 2025, there was $ 3.9 million of total unrecognized compensation costs related to approximately 493,000 non-vested PRSUs, which is expected to be recognized over a remaining weighted-average period of 2.9 years.

Earnings (loss) per Share

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares outstanding during the period.

Diluted earnings (loss) per share is computed by dividing net income (loss) by the sum of (1) the weighted-average number of shares of common stock outstanding during the period, and (2) the dilutive effect of assumed conversion of equity awards using the treasury stock method.

With respect to the number of weighted-average shares outstanding (denominator), diluted shares reflect:

4 unchanged sentences

(tabular dollars and shares in thousands, except per share data)

The following table sets forth the computations of basic and diluted (loss) earnings per share:

Three months ended March 31,

Basic (loss) earnings per share

Net (loss) income attributable to Mistras Group, Inc.

The following table sets forth the computations of basic and diluted earnings (loss) per share:

Three months ended June 30, Six months ended June 30,

2025 2024 2025 2024

Basic earnings (loss) per share

Net income (loss) attributable to Mistras Group, Inc.

$ 3,017 $ 6,369 $ ( 169 ) $ 7,364

Weighted average common shares outstanding 31,439 30,979 31,268 30,842

Basic (loss) earnings per share $ ( 0.10 ) $ 0.03

Diluted (loss) earnings per share:

Net (loss) income attributable to Mistras Group, Inc.

Basic earnings (loss) per share $ 0.10 $ 0.21 $ — $ 0.24

Diluted earnings (loss) per share:

Net income (loss) attributable to Mistras Group, Inc.

$ 3,017 $ 6,369 $ ( 169 ) $ 7,364

3 unchanged sentences

163 217 — 423

Diluted (loss) earnings per share $ ( 0.10 ) $ 0.03

31,693 31,293 31,268 31,358

(1) For the three months ended March 31, 2025, 145,000 shares, related to stock options and 808,000 shares, related to restricted stock units were excluded from the calculation of diluted (loss) earnings per share due to the net loss for the period.

Diluted earnings (loss) per share $ 0.10 $ 0.20 $ — $ 0.23

_______________

(1) For the three months ended June 30, 2025, 375,000 shares, related to stock options and 877,000 shares, related to restricted stock units were anti-dilutive and therefore were excluded from the calculation of diluted earnings (loss) per share.

For the six months ended June 30, 2025, 106,000 shares, related to stock options and 867,000 shares, related to restricted stock units were excluded from the calculation of diluted earnings (loss) per share due to the net loss for the period.

Accounts Receivable, net

Accounts receivable consisted of the following (in thousands):

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Trade accounts receivable $ 162,727 $ 129,894

1 unchanged sentence

Accounts receivable, net $ 159,823 $ 127,281

The Company had $ 34.4 million and $ 21.3 million of unbilled revenue accrued as of March 31, 2025 and December 31, 2024, respectively.

The Company had $ 41.0 million and $ 21.3 million of unbilled revenue accrued as of June 30, 2025 and December 31, 2024, respectively.

These amounts are included in the trade accounts receivable balances above.

6 unchanged sentences

Inventories consist of the following (in thousands):

March 31, 2025 December 31, 2024

Raw materials $ 5,069 $ 5,344

June 30, 2025 December 31, 2024

Raw materials and consumable supplies $ 9,771 $ 8,321

Work in progress 1,036 1,018

Finished goods 4,311 5,146

Consumable supplies 3,083 2,977

Inventories $ 15,118 $ 14,485

1 unchanged sentence

Property, plant and equipment, net consisted of the following:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Land $ 2,470 $ 2,429

8 unchanged sentences

Property, plant and equipment, net $ 85,909 $ 80,892

Depreciation expense for the three months ended March 31, 2025 and 2024 was approximately $ 6.0 million and $ 6.5 million, respectively.

Depreciation expense for the three months ended June 30, 2025 and 2024 was approximately $ 6.1 million and $ 6.4 million, respectively.

Depreciation expense for the six months ended June 30, 2025 and 2024 was $ 12.1 million and $ 12.8 million, respectively.

Changes in the carrying amount of goodwill by segment is shown below:

2 unchanged sentences

Foreign currency translation 3,683 — — 3,683

Balance at March 31, 2025 $ 181,530 $ — $ — $ 181,530

Balance at June 30, 2025 $ 185,125 $ — $ — $ 185,125

The Company reviews goodwill for impairment on a reporting unit basis on October 1 of each year and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable.

The Company performed a quantitative annual impairment test as of October 1, 2024 and the Company did not identify any changes in circumstances that would indicate the carrying value of goodwill may not be recoverable.

Additionally, through March 31, 2025, the Company did not identify any changes in circumstances that would indicate the carrying value of goodwill may not be recoverable.

Additionally, through June 30, 2025, the Company did not identify any changes in circumstances that would indicate the carrying value of goodwill may not be recoverable.

Significant adverse changes in future periods could negatively affect the Company's key assumptions and may result in future goodwill impairment charges which could be material.

5 unchanged sentences

The gross amount, accumulated amortization and net carrying amount of intangible assets were as follows:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

(Years) Gross

7 unchanged sentences

Total $ 193,028 $ ( 153,457 ) $ 39,571 $ 187,727 $ ( 148,019 ) $ 39,708

Amortization expense for the three months ended March 31, 2025 and 2024 was approximately $ 1.8 million and $ 1.9 million, respectively.

Amortization expense for the three months ended June 30, 2025 and 2024 was approximately $ 1.6 million and $ 1.9 million, respectively.

Amortization expense for the six months ended June 30, 2025 and 2024 was $ 3.4 million and $ 3.9 million, respectively.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Accrued salaries, wages and related employee benefits $ 30,820 $ 27,990

7 unchanged sentences

Long-term debt consisted of the following:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Senior credit facility $ 84,250 $ 59,650

10 unchanged sentences

Senior Credit Facility

On August 1, 2022, the Company entered into a credit agreement (the “Credit Agreement”), which provides the Company with a $ 190 million 5-year committed revolving credit facility and a $ 125 million term loan with a balance of $ 105.2 million as of March 31, 2025.

The Credit Agreement permits the Company to borrow up to $ 100 million in non-U.S.

13 unchanged sentences

• Quarterly payments on the term loan of $ 1.56 million through June 30, 2024, then increasing to $ 2.34 million through June 30, 2025, and to $ 3.12 million for each quarterly payment thereafter through maturity.

As of March 31, 2025, the Company had borrowings of $ 169.6 million and a total of $ 3.1 million of letters of credit outstanding under the Credit Agreement.

The Company has capitalized costs associated with debt modifications of $ 0.8 million as of March 31, 2025, which is included in Other Assets on the Condensed Consolidated Balance Sheets and will be amortized into interest expense over the remaining term of the Credit Agreement through July 30, 2027.

As of March 31, 2025, the Company was in compliance with the terms and covenants of the Credit Agreement.

As of June 30, 2025, the Company had borrowings of $ 187.2 million and a total of $ 3.1 million of letters of credit outstanding under the Credit Agreement.

The Company has capitalized costs associated with debt modifications of $ 0.7 million as of June 30, 2025, which is included in Other Assets on the Unaudited Condensed Consolidated Balance Sheets and will be amortized into interest expense over the remaining term of the Credit Agreement through July 30, 2027.

As of June 30, 2025, the Company was in compliance with the terms and covenants of the Credit Agreement.

The Company continuously monitors compliance with the covenants contained in the Credit Agreement.

6 unchanged sentences

The Company's other debt includes bank financing provided at the local subsidiary level used to support working capital requirements and fund capital expenditures.

At March 31, 2025, there was an aggregate of approximately $ 2.2 million outstanding, payable at various times through 2030.

At June 30, 2025, there was an aggregate of approximately $ 2.3 million outstanding, payable at various times through 2030.

Monthly payments range from $ 0.7 thousand to $ 16.9 thousand and interest rates range from 0.4 % to 3.5 %.

38 unchanged sentences

On April 29, 2025, the Company received a notice from the EPA requesting information regarding the improvements and other matters related to Phoenix testing facility.

Mistras Arizona provided the EPA with the requested information in July 2025.

As it relates to this lawsuit, the recorded probable losses remain an estimate, and actual costs arising from this matter could materially differ depending on the actual costs incurred as well as the availability of additional insurance coverage.

4 unchanged sentences

The Company has determined that the subsidiary is likely to incur partial or complete withdrawal liability to the other pension fund.

The balance of the estimated total amount of this potential liability as of March 31, 2025 is approximately $ 2.5 million, which were incurred in 2018 and 2019.

The balance of the estimated total amount of this potential liability as of June 30, 2025 is approximately $ 2.5 million, which were incurred in 2018 and 2019.

Segment Disclosure

14 unchanged sentences

Our segments are based on the type and concentration of customers served, service requirements, methods of distribution and major product lines.

Mistras Group, Inc.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

Segment income (loss) from operations is the primary performance measure used by the CODM to evaluate segment performance and allocate resources, including considering budget-to-actual variances and prior year-to-actual variances on a monthly basis in accordance with GAAP under ASC 280, Segment Reporting.

6 unchanged sentences

Income (loss) from operations by operating segment includes intercompany transactions, which are eliminated in Corporate and eliminations .

For the three months ended March 31, 2025

For the three months ended June 30, 2025

North America International Products and Systems Total Reportable Segments Corporate and eliminations Total

3 unchanged sentences

Income (loss) from operations $ 16,758 $ 4,004 $ 336 $ 21,098 $ ( 12,670 ) $ 8,428

For the three months ended March 31, 2024

For the three months ended June 30, 2024

North America International Products and Systems Total Reportable Segments Corporate and eliminations Total

3 unchanged sentences

Income (loss) from operations $ 18,727 $ 1,647 $ 495 $ 20,869 $ ( 8,910 ) $ 11,959

For the six months ended June 30, 2025

North America International Products and Systems Total Reportable Segments Corporate and eliminations Total

Revenue $ 276,894 $ 72,291 $ 5,831 $ 355,016 $ ( 7,996 ) $ 347,020

Selling, general & administrative expenses 41,683 15,066 1,620 58,369 17,076 75,445

Other Expenses 211,938 52,140 3,548 267,626 ( 3,467 ) 264,159

Income (loss) from operations $ 23,273 $ 5,085 $ 663 $ 29,021 $ ( 21,605 ) $ 7,416

For the six months ended June 30, 2024

North America International Products and Systems Total Reportable Segments Corporate and eliminations Total

Revenue $ 306,743 $ 67,311 $ 6,583 $ 380,637 $ ( 6,422 ) $ 374,215

Selling, general & administrative expenses 39,271 14,834 1,896 56,001 16,430 72,431

Other Expenses 235,185 49,706 3,878 288,769 ( 4,496 ) 284,273

Income (loss) from operations $ 32,287 $ 2,771 $ 809 $ 35,867 $ ( 18,356 ) $ 17,511

The tables above only reconcile to income (loss) from operations as our measure of segment profitability and the remainder of the reconciliation to net income (loss) can be seen on the Unaudited Condensed Consolidated Statement of Income (Loss).

Products and Systems segment revenue was comprised of approximately $ 1.0 million and $ 0.9 million of sales to the International segment, which were eliminated upon consolidation, for the three months ended March 31, 2025 and March 31, 2024, respectively.

Intersegment revenue related to sales between other segments was immaterial for each of the three month periods ended March 31, 2025 and March 31, 2024.

Mistras Group, Inc.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

(tabular dollars and shares in thousands, except per share data)

Products and Systems segment revenue was comprised of approximately $ 0.5 million and $ 1.0 million of sales to the International segment, which were eliminated upon consolidation, for the three months ended June 30, 2025 and June 30, 2024, respectively.

Products and Systems segment revenue was comprised of approximately $ 1.5 million and $ 1.8 million of sales to the International segment, which were eliminated upon consolidation, for the six months ended June 30, 2025 and June 30, 2024, respectively.

Intersegment revenue related to sales between other segments was immaterial for each of the three and six month periods ended June 30, 2025 and June 30, 2024.

Selected consolidated financial information by segment for the periods shown was as follows:

(with intercompany transactions eliminated in Corporate and eliminations):

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Intangible assets, net

4 unchanged sentences

$ 39,571 $ 39,708

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

North America $ 416,056 $ 390,052

3 unchanged sentences

$ 571,043 $ 523,038

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Long-lived assets

4 unchanged sentences

$ 310,605 $ 302,042

Refer to Note 2 - Revenue , for revenue by geographic area for the three months ended March 31, 2025 and 2024.

Refer to Note 2 - Revenue , for revenue by geographic area for the three and six months ended June 30, 2025 and 2024.

Mistras Group, Inc.

3 unchanged sentences

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