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Item 1. Financial Statements

2025-05-01 compared with 2024-10-24 · 221 added, 254 removed, 408 unchanged (54% of the section changed)

1 unchanged sentence

MSA SAFETY INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended September 30, Nine Months Ended September 30,

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended March 31,

(In thousands, except per share values) 2025 2024

6 unchanged sentences

Currency exchange losses, net 4,076 2,333

Loss on divestiture of MSA LLC (Note 17) — — — 129,211

Product liability expense (Note 17) — — — 3

Operating income 77,761 80,112

1 unchanged sentence

Other income, net ( 7,023 ) ( 6,235 )

Total other expense, net 3,320 6,461 13,341 21,662

Total other (income) expense, net ( 188 ) 4,505

Income before income taxes 77,949 75,607

Provision for income taxes (Note 11) 18,344 17,468

Net income (loss) $ 66,648 $ 65,256 $ 197,021 $ ( 17,827 )

Earnings (loss) per share attributable to common shareholders (Note 9):

Net income $ 59,605 $ 58,139

Earnings per share attributable to common shareholders (Note 10):

Basic $ 1.51 $ 1.48

3 unchanged sentences

MSA SAFETY INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended September 30, Nine Months Ended September 30,

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended March 31,

(In thousands) 2025 2024

Net income (loss) $ 66,648 $ 65,256 $ 197,021 $ ( 17,827 )

Net income $ 59,605 $ 58,139

Other comprehensive gain (loss), net of tax:

1 unchanged sentence

Pension and post-retirement plan adjustments, net of tax (Note 7) 201 374

Unrealized gain on available-for-sale securities (Note 6) — — — 2

Reclassification of currency translation from accumulated other comprehensive loss into net income (Note 6) — 101 ( 1,200 ) 101

Total other comprehensive gain (loss), net of tax 22,738 ( 10,299 )

Comprehensive income (loss) $ 87,991 $ 46,774 $ 200,065 $ ( 19,520 )

Comprehensive income $ 82,343 $ 47,840

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands) September 30, 2024 December 31, 2023

(In thousands) March 31, 2025 December 31, 2024

Cash and cash equivalents $ 170,617 $ 164,560

40 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2025 2024

Operating Activities

Net income (loss) $ 197,021 $ ( 17,827 )

Net income $ 59,605 $ 58,139

Depreciation and amortization 16,251 15,559

Tax-effected loss on divestiture of MSA LLC (Note 17) — 199,578

Stock-based compensation (Note 12) 2,629 4,187

1 unchanged sentence

Deferred income tax benefit (Note 11) ( 83 ) ( 2,190 )

Loss (gain) on asset dispositions, net 959 ( 671 )

Loss on asset dispositions, net 8 51

Pension contributions (Note 15) ( 1,832 ) ( 1,316 )

Currency exchange losses, net 4,076 2,333

Product liability expense (Note 17) — 3

Product liability payments (Note 17) — ( 5,250 )

Contribution on divestiture of MSA LLC (Note 17) — ( 341,186 )

Trade receivables ( 13,727 ) 12,132

3 unchanged sentences

Other noncurrent assets and liabilities ( 153 ) ( 702 )

Cash Flow From (Used in) Operating Activities 188,520 ( 66,057 )

Cash Flow From Operating Activities 61,833 50,886

Investing Activities

5 unchanged sentences

Payments on long-term debt (Note 13) ( 253,466 ) ( 331,010 )

Debt issuance costs ( 200 ) ( 1,138 )

Cash dividends paid ( 20,033 ) ( 18,490 )

1 unchanged sentence

Exercise of stock options (Note 8) 230 253

Employee stock purchase plan (Note 7) 634 497

Cash Flow (Used in) From Financing Activities ( 136,172 ) 110,507

Cash Flow Used in Financing Activities ( 45,612 ) ( 29,085 )

Effect of exchange rate changes on cash, cash equivalents and restricted cash 743 ( 8,676 )

13 unchanged sentences

Comprehensive

Balances June 30, 2023 $ 1,038,750 $ ( 141,928 )

Net income 65,256 —

Foreign currency translation adjustments — ( 18,771 )

Pension and post-retirement plan adjustments, net of tax expense of $ 27

Reclassification from accumulated other comprehensive loss into net income (Note 6) — 101

Common dividends ($ 0.47 per share)

Preferred dividends ($ 0.5625 per share)

Balances September 30, 2023 $ 1,085,521 $ ( 160,410 )

Balances June 30, 2024 $ 1,235,226 $ ( 147,548 )

Balances December 31, 2023 $ 1,143,442 $ ( 129,249 )

Net income 58,139 —

3 unchanged sentences

Preferred dividends ($ 0.5625 per share)

Balances September 30, 2024 $ 1,281,793 $ ( 126,205 )

Balances December 31, 2022 $ 1,158,347 $ ( 158,717 )

Net loss ( 17,827 ) —

Foreign currency translation adjustments — ( 2,538 )

Pension and post-retirement plan adjustments, net of tax expense of $ 259

Unrecognized net gains on available-for-sale securities (Note 16) — 2

Reclassification from accumulated other comprehensive loss into net income (Note 6) — 101

Common dividends ($ 1.40 per share)

Preferred dividends ($ 1.6875 per share)

Balances September 30, 2023 $ 1,085,521 $ ( 160,410 )

Balances March 31, 2024 $ 1,183,091 $ ( 139,548 )

Balances December 31, 2024 $ 1,349,650 $ ( 141,649 )

1 unchanged sentence

Foreign currency translation adjustments — 22,537

Pension and post-retirement plan adjustments, net of tax benefit of $ 628

Reclassification from accumulated other comprehensive loss into net income (Note 6) — ( 1,200 )

Pension and post-retirement plan adjustments, net of tax expense of $ 191

Common dividends ($ 0.51 per share)

Preferred dividends ($ 0.5625 per share)

Balances September 30, 2024 $ 1,281,793 $ ( 126,205 )

Balances March 31, 2025 $ 1,389,222 $ ( 118,911 )

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

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This Form 10-Q report should be read in conjunction with MSA's Form 10-K for the year ended December 31, 2024, which includes all disclosures required by U.S.

In December 2023, the FASB issued ASU No.

2023-09 (“ASU 2023-09”), Improvements to Income Tax Disclosures .

ASU 2023-09 requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid.

This standard also includes certain other amendments to improve the effectiveness of income tax disclosures.

ASU 2023-09 is effective for public business entities, for annual periods beginning after December 15, 2024.

With the exception of expanding disclosures, we do not expect the adoption of ASU 2023-09 to have a material effect on our consolidated financial statements taken as a whole.

In November 2024, the FASB issued ASU No.

2023-07 (“ASU 2023-07”), Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

ASU 2023-07 requires annual and interim disclosures that are expected to improve reportable segment disclosures, primarily through enhanced disclosures about significant expenses in determining segment profit or loss.

The provisions of ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

We will apply the new disclosure requirements of ASU 2023-07 in our 2024 Form 10-K and, with the exception of expanding disclosures about significant segment expenses, do not expect that the adoption of ASU 2023-07 will have a material effect on our consolidated financial statements taken as a whole.

2024-03 (“ASU 2024-03”), Disaggregation of Income Statement Expenses (“DISE”) .

ASU 2024-03 requires disaggregated disclosure of income statement expenses for public business entities.

ASU 2024-03 does not change the expense captions an entity presents on the face of the income statement;

rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements.

As revised by ASU No.

2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures , the provisions of ASU 2024-03 are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

With the exception of expanding disclosures to include more granular income statement expense categories, we do not expect the adoption of ASU 2024-03 to have a material effect on our consolidated financial statements taken as a whole.

Note 2— Revenue Recognition

We generate revenue primarily from manufacturing and selling a comprehensive line of safety products and solutions to protect the health and safety of workers and facility infrastructures around the world.

Our customers generally fall into two categories:

distributors and industrial or end-users.

All customer categories have similar nature, timing and uncertainty related to cash flows.

As a result, the underlying principles of revenue recognition are identical for both categories of customers.

We account for revenue in accordance with ASC 606, Revenue from Contracts with Customers.

Revenue from the sale of products and solutions is recognized when there is persuasive evidence of an arrangement and control passes to the customer, which generally occurs either when product is shipped to the customer or, in the case of certain customers, when product is delivered to the customer's site.

We establish our shipping terms according to local practice and market characteristics.

We do not ship product unless we have an order or other documentation authorizing shipment to our customers.

Our payment terms vary by the type and location of our customer and the products and solutions offered;

however, in most cases, the term between invoicing and when payment is due is not significant.

Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services.

Amounts billed and due from our customers are classified as receivables on the unaudited Condensed Consolidated Balance Sheets.

We make appropriate provisions for credit losses, which have historically been insignificant in relation to our net sales.

Certain contracts with customers may have an element of variable consideration that is estimated when revenue is recognized under the contract to the extent that it is material to the individual contract.

Variable consideration could include volume incentive rebates and performance guarantees.

Rebates are based on achieving a certain level of purchases and other performance criteria that are documented in established distributor programs.

These rebates are estimated based on projected sales to the customer and accrued as a reduction of net sales as they are earned by the customer.

Sales, value added and other taxes collected with revenue-producing activities and remitted to governmental authorities are excluded from revenue.

Depending on the terms of the arrangement, we may defer revenue for which we have a future obligation, which may include leases where the Company is the lessor, training, extended warranty, software subscriptions, maintenance and technical services, until such time that the obligation has been satisfied.

We use an observable price, or a cost plus margin approach when one is not available, to determine the stand-alone selling price for separate performance obligations.

We have elected to recognize the cost for shipping and handling as an expense when control of the product has passed to the customer.

These costs are included within the Cost of products sold line on the unaudited Condensed Consolidated Statements of Income.

Amounts billed to customers for shipping and handling are included within the Net sales line on the unaudited Condensed Consolidated Statements of Income.

Performance Obligations

The Company recognizes revenue when performance obligations identified under the terms of the contract with its customers are satisfied, which generally occurs upon the transfer of control in accordance with the contractual terms and conditions of sale.

For most contracts with customers, this results in point-in-time revenue recognition once contractual shipping terms are fulfilled.

Disaggregation of Revenue

Refer to Note 9—Segment Information for disaggregation of revenue by segment and product category, as we believe this best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Lessor Arrangements

The Company derives a portion of its revenue from various leasing contracts where the Company is the lessor, primarily managed fire service contracts.

Such arrangements provide for recurring payments throughout the contract term.

These payments cover equipment provided in addition to several services which include maintenance and interest.

Managed fire service contracts meet the criteria to be accounted for as sales-type leases.

Under ASC 842, Leases , these contracts contain both lease and non-lease components.

For a component to be separate, the customer would be able to benefit from the right of use of the component separately or with other resources readily available to the customer and the right of the use is not highly dependent or highly interrelated with the other rights to use the other underlying assets or components.

For managed fire service contracts, revenue from equipment provided is considered a lease component and recognized with point in time revenue recognition upon lease commencement.

Upon the recognition of such revenue, an asset is established for the investment in sales-type leases.

Maintenance revenue, which is considered a non-lease component, and interest are recognized monthly over the lease term.

As of March 31, 2025, remaining maintenance performance obligations for managed fire service contracts were $ 33.4 million, which are expected to be recognized to revenue over approximately 3 years.

Lease revenues and interest earned by the Company, included in the unaudited Condensed Consolidated Statements of Income, were not material to either the quarter ended March 31, 2025, or 2024.

Practical Expedients and Exemptions

We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

We do not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less.

We generally expense sales commissions when incurred because the amortization period would have been one year or less.

These costs are recorded within selling, general and administrative expenses in our Consolidated Statements of Income.

Note 3— Cash and Cash Equivalents

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The Company's net cash pool position consisted of the following:

(In thousands) September 30, 2024

(In thousands) March 31, 2025

Gross cash pool position $ 102,623

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Note 4— Restructuring Charges

During the three and nine months ended September 30, 2024, we recorded restructuring charges of $ 1.2 million and $ 5.7 million, respectively.

Americas segment restructuring charges of $ 1.3 million during the nine months ended September 30, 2024, were related to manufacturing footprint optimization activities.

International segment restructuring charges of $ 3.2 million during the nine months ended September 30, 2024, were related to ongoing initiatives to optimize our manufacturing footprint and improve productivity as well as management restructuring.

Corporate segment restructuring charges of $ 1.2 million during the nine months ended September 30, 2024, were related to management restructuring.

During the three and nine months ended September 30, 2023, we recorded restructuring charges of $ 3.3 million and $ 8.4 million, respectively.

Americas segment restructuring charges of $ 2.7 million during the nine months ended September 30, 2023, were related to manufacturing footprint optimization activities.

International segment restructuring charges of $ 3.6 million during the nine months ended September 30, 2023, were related to ongoing initiatives to drive profitable growth and improve productivity.

Corporate segment restructuring charges of $ 2.1 million during the nine months ended September 30, 2023, were related to footprint optimization activities and management restructuring.

During the three months ended March 31, 2025, we recorded restructuring charges of $ 1.9 million.

Americas segment restructuring charges of $ 0.4 million during the three months ended March 31, 2025, were related to initiatives to right-size the organization in response to macroeconomic conditions.

International segment restructuring charges of $ 0.9 million during the three months ended March 31, 2025, were primarily related to ongoing initiatives to optimize our manufacturing footprint and initiatives to right-size the organization in response to macroeconomic conditions.

Corporate segment restructuring charges of $ 0.6 million during the three months ended March 31, 2025, were related to initiatives to right-size the organization in response to macroeconomic conditions.

During the three months ended March 31, 2024, we recorded restructuring charges of $ 3.0 million.

Americas segment restructuring charges of $ 0.3 million during the three months ended March 31, 2024, were related to manufacturing footprint optimization activities.

International segment restructuring charges of $ 1.9 million during the three months ended March 31, 2024, were related to management restructuring and ongoing initiatives to drive profitable growth and improve productivity.

Corporate segment restructuring charges of $ 0.8 million during the three months ended March 31, 2024, were related to footprint optimization activities and management restructuring.

Restructuring reserves are included in Other current liabilities in the accompanying unaudited Condensed Consolidated Balance Sheets.

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Restructuring charges 0.4 0.9 0.6 1.9

Currency translation — 0.1 — 0.1

Cash payments ( 0.1 ) ( 0.9 ) — ( 1.0 )

Reserve balances at September 30, 2024 $ 0.2 $ 4.2 $ — $ 4.4

Reserve balances at March 31, 2025 $ 0.5 $ 3.3 $ 0.6 $ 4.4

Note 5— Inventories

The following table sets forth the components of inventory:

(In thousands) September 30, 2024 December 31, 2023

(In thousands) March 31, 2025 December 31, 2024

Finished products $ 96,507 $ 93,356

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The following table sets forth the components of property, plant and equipment, net:

(In thousands) September 30, 2024 December 31, 2023

(In thousands) March 31, 2025 December 31, 2024

Land $ 4,309 $ 4,235

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Changes in accumulated other comprehensive loss were as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2025 2024

1 unchanged sentence

Balance at beginning of period $ ( 11,390 ) $ ( 42,652 )

Amounts reclassified from accumulated other comprehensive loss into net income (loss):

Amortization of prior service credit (Note 14) ( 9 ) ( 24 ) ( 27 ) ( 72 )

Amounts reclassified from accumulated other comprehensive loss into net income:

Amortization of prior service cost (credit) (Note 15) 32 ( 9 )

Recognized net actuarial losses (Note 15) 360 397

Tax (benefit) expense ( 374 ) 27 ( 628 ) 259

Total amount reclassified from accumulated other comprehensive loss, net of tax, into net income (loss) 14 188 2,410 742

Balance at end of period $ ( 40,242 ) $ ( 49,593 ) $ ( 40,242 ) $ ( 49,593 )

Available-for-sale securities

Balance at beginning of period $ — $ — $ — $ ( 2 )

Unrealized net gains on available-for-sale securities (Note 16) — — — 2

Tax benefit ( 191 ) ( 14 )

Total amount reclassified from accumulated other comprehensive loss, net of tax, into net income 201 374

Balance at end of period $ ( 11,189 ) $ ( 42,278 )

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Balance at beginning of period $ ( 130,259 ) $ ( 86,597 )

Reclassification from accumulated other comprehensive loss into net income (loss) (b)

— 101 ( 1,200 ) 101

Foreign currency translation adjustments 22,537 ( 10,673 )

Balance at end of period $ ( 107,722 ) $ ( 97,270 )

(a) Amounts reclassified from accumulated other comprehensive loss into net income (loss) are included in the computation of net periodic pension and other post-retirement benefit costs (refer to Note 14—Pensions and Other Post-retirement Benefits).

(b) Reclassification from accumulated other comprehensive loss into net income (loss) relates primarily to the recognition of non-cash net cumulative translation gains associated with certain foreign subsidiaries.

The reclassifications are included in Currency exchange losses, net, within the unaudited Condensed Consolidated Statements of Income.

(a) Amounts reclassified from accumulated other comprehensive loss into net income are included in the computation of net periodic pension and other post-retirement benefit costs (refer to Note 15—Pensions and Other Post-retirement Benefits).

Note 8— Capital Stock

Preferred Stock - The Company has authorized 100,000 shares of $ 50 par value 4.5 % cumulative preferred nonvoting stock which is callable at $ 52.50 .

There were 71,340 shares issued and 52,998 shares held in treasury at both September 30, 2024 and December 31, 2023.

There were 71,340 shares issued and 52,998 shares held in treasury at both March 31, 2025, and December 31, 2024.

The Treasury shares at cost line in the unaudited Condensed Consolidated Balance Sheets includes $ 1.8 million related to preferred stock.

There were no shares of preferred stock purchased and subsequently held in treasury during the nine months ended September 30, 2024 or 2023.

There were no shares of preferred stock purchased and subsequently held in treasury during the three months ended March 31, 2025, or 2024.

The Company has also authorized 1,000,000 shares of $ 10 par value second cumulative preferred voting stock.

No shares have been issued as of September 30, 2024, or December 31, 2023.

No shares have been issued as of March 31, 2025, or December 31, 2024.

Common Stock - The Company has authorized 180,000,000 shares of no par value common stock.

There were 62,081,391 shares issued as of September 30, 2024 and December 31, 2023.

No new shares were issued during the nine months ended September 30, 2024 or 2023.

There were 39,309,938 and 39,317,212 shares outstanding at September 30, 2024 and December 31, 2023, respectively.

Treasury Shares - The Company has a stock repurchase program that authorizes up to $ 200.0 million to repurchase MSA common stock in the open market and in private transactions.

There were 62,081,391 shares issued as of March 31, 2025, and December 31, 2024.

No new shares were issued during the three months ended March 31, 2025, or 2024.

There were 39,298,861 and 39,260,080 shares outstanding at March 31, 2025, and December 31, 2024, respectively.

Treasury Shares - The Company's 2024 stock repurchase program authorizes up to $ 200.0 million to repurchase MSA common stock in the open market and in private transactions.

The stock repurchase program has no expiration date.

The maximum number of shares that may be repurchased is calculated based on the dollars remaining under the program and the respective month-end closing share price.

During the nine months ended September 30, 2024, and 2023, the Company repurchased 108,917 and no shares, respectively, under this and the prior stock repurchase program.

There were 22,771,453 and 22,764,179 treasury shares at September 30, 2024 and December 31, 2023, respectively.

During the three months ended March 31, 2025, and 2024, the Company repurchased 62,125 and no shares, respectively, under this and the prior stock repurchase program.

There were 22,782,530 and 22,821,311 treasury shares at March 31, 2025, and December 31, 2024, respectively.

The Company issues treasury shares for all stock-based benefit plans.

Shares are issued from treasury at the average treasury share cost on the date of the transaction.

There were 141,618 and 125,967 Treasury shares issued for these purposes during the nine months ended September 30, 2024, and 2023, respectively.

There were 153,734 and 95,428 Treasury shares issued for these purposes during the three months ended March 31, 2025, and 2024, respectively.

Common stock activity is summarized as follows:

Three Months Ended September 30, 2024 Three Months Ended September 30, 2023

(In thousands) Common

Stock Treasury

Balance at beginning of period $ 320,556 $ ( 376,556 ) $ 294,364 $ ( 362,025 )

Stock compensation expense 4,217 — 8,477 —

Restricted and performance stock awards ( 275 ) 275 ( 15 ) 15

Stock options exercised 111 57 591 307

Treasury shares purchased for stock compensation programs — ( 571 ) — ( 70 )

Share repurchase program — ( 10,027 ) — —

Balance at end of period $ 324,609 $ ( 386,822 ) $ 303,417 $ ( 361,773 )

(a) Excludes treasury cost related to preferred stock.

Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023

Three Months Ended March 31, 2025 Three Months Ended March 31, 2024

(In thousands) Common

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Treasury shares purchased for stock compensation programs — ( 8,347 ) — ( 5,838 )

Employee stock purchase program 574 60 432 65

Share repurchase program — ( 9,996 ) — —

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and Asia Pacific.

The operating segments have been aggregated (based on economic similarities, the nature of their products, end-user markets and methods of distribution) into three reportable segments:

The operating segments have been aggregated (based on economic similarities, the nature of their products and solutions, end-user markets and methods of distribution) into three reportable segments:

Americas, International, and Corporate.

The Americas segment is comprised of our operations in Northern North American and Latin American geographies.

The Americas segment is comprised of our operations in Northern North America and Latin America geographies.

The International segment is comprised of our operations in all geographies outside of the Americas.

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The Company's sales are allocated to each segment based primarily on the country destination of the end-customer.

Adjusted operating income (loss) is the measure used by the chief operating decision maker to evaluate segment performance and allocate resources.

Adjusted operating income (loss) is defined as operating income (loss) excluding restructuring charges, currency exchange (gains) losses, product liability expense, loss on divestiture of Mine Safety Appliances Company, LLC ("MSA LLC"), net cost for product related legal matter, transaction costs and acquisition-related amortization.

The Company adopted ASU No.

2023-07 (“ASU 2023-07”), Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures for the year ended December 31, 2024, and applied it retrospectively for all prior periods presented.

Adjusted operating income (loss) is the measure used by the chief operating decision maker, identified as our President and Chief Executive Officer, to evaluate segment performance and identify opportunities when allocating resources.

Adjusted operating income (loss) is defined as operating income excluding restructuring charges, currency exchange gains (losses), transaction costs and acquisition-related amortization.

The accounting principles applied at the operating segment level in determining the segment measure of profit or loss are the same as those applied at the unaudited condensed consolidated financial statement level.

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Reportable segment information is presented in the following table:

(In thousands) Americas International Corporate Consolidated

Three Months Ended September 30, 2024

Net sales to external customers $ 299,497 $ 133,182 $ — $ 432,679

Adjusted operating income (loss) 91,822 18,174 ( 12,081 ) 97,915

Three Months Ended September 30, 2023

Net sales to external customers $ 314,273 $ 132,455 $ — $ 446,728

Adjusted operating income (loss) 93,918 22,577 ( 15,198 ) 101,297

(In thousands) Americas International Corporate Consolidated

Nine Months Ended September 30, 2024

(In thousands) Americas International Corporate Reconciling

Three Months Ended March 31, 2025

Net sales to external customers $ 293,160 $ 128,180 $ — $ 421,340

Cost of products sold 154,180 71,479 — —

Selling, general and administrative 50,918 31,693 9,899 —

Research and development 9,369 6,300 — —

Adjusted operating income (loss) 78,693 18,708 ( 9,899 ) — 87,502

Nine Months Ended September 30, 2023

Noncash items:

Depreciation and amortization 11,517 4,505 229 $ — 16,251

Pension (income) expense ( 4,695 ) 847 — — ( 3,848 )

Total Assets 1,481,750 699,029 57,700 ( 2,594 ) 2,235,885

Capital expenditures 8,791 1,850 143 — 10,784

Three Months Ended March 31, 2024

Net sales to external customers $ 295,539 $ 117,763 $ — $ 413,302

Cost of products sold 147,877 67,557 23 —

Selling, general and administrative 51,925 30,321 11,672 —

Research and development 9,519 6,399 — —

Adjusted operating income (loss) 86,218 13,486 ( 11,695 ) — 88,009

Noncash items:

Depreciation and amortization 11,273 4,075 211 $ — 15,559

Pension (income) expense ( 3,258 ) 1,050 — — ( 2,208 )

Total Assets 1,461,565 714,276 ( 2,092 ) (b)

581 2,174,330

Capital expenditures 6,554 4,066 599 — 11,219

(a) Reconciling items consist primarily of intercompany eliminations and items not directly attributable to operating segments.

(b) Negative Corporate segment assets driven primarily by bank overdrafts under our notional cash pooling arrangement.

Refer to Note 3—Cash and Cash Equivalents for further details.

A reconciliation of total Adjusted operating income from reportable segments to Income before income taxes is presented in the following table:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2025 2024

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Transaction costs (a)

Net cost for product related legal matter — — 5,000 —

Loss on divestiture of MSA LLC (Note 17) — — — 129,211

Product liability expense (Note 17) — — — 3

Income before income taxes $ 77,949 $ 75,607

(a) Transaction costs include advisory, legal, accounting, valuation, and other professional or consulting fees incurred during our evaluation of acquisitions and divestitures.

These costs are included in Selling, general and administrative expense in the unaudited Condensed Consolidated Statements of Operations.

(a) Transaction costs include advisory, legal, accounting, valuation, and other professional or consulting fees incurred in connection with acquisitions and divestitures.

These costs are included in Selling, general and administrative expense in the unaudited Condensed Consolidated Statements of Income.

Total sales by product group was as follows:

Three Months Ended September 30, 2024 Consolidated Americas International

(In thousands, except percentages) Dollars Percent Dollars Percent Dollars Percent

Fire Service (a)

$ 160,515 37 % $ 111,992 37 % $ 48,523 36 %

Detection (b)

163,150 38 % 110,459 37 % 52,691 40 %

Industrial PPE and Other (c)

109,014 25 % 77,046 26 % 31,968 24 %

Total $ 432,679 100 % $ 299,497 100 % $ 133,182 100 %

Three Months Ended September 30, 2023 Consolidated Americas International

(In thousands, except percentages) Dollars Percent Dollars Percent Dollars Percent

Fire Service (a)

$ 175,732 39 % $ 131,516 42 % $ 44,216 33 %

Detection (b)

155,694 35 % 105,007 33 % 50,687 38 %

Industrial PPE and Other (c)

115,302 26 % 77,750 25 % 37,552 29 %

Total $ 446,728 100 % $ 314,273 100 % $ 132,455 100 %

Nine Months Ended September 30, 2024 Consolidated Americas International

Three Months Ended March 31, 2025 Consolidated Americas International

(In thousands, except percentages) Dollars Percent Dollars Percent Dollars Percent

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Total $ 421,340 100 % $ 293,160 100 % $ 128,180 100 %

Nine Months Ended September 30, 2023 Consolidated Americas International

Three Months Ended March 31, 2024 Consolidated Americas International

(In thousands, except percentages) Dollars Percent Dollars Percent Dollars Percent

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Note 9— Earnings (Loss) per Share

Basic earnings (loss) per share is computed by dividing net income, after the deduction of preferred stock dividends and undistributed earnings allocated to participating securities, by the weighted average number of common shares outstanding during the period.

Diluted earnings (loss) per share assumes the issuance of common stock for all potentially dilutive share equivalents outstanding not classified as participating securities.

Note 10— Earnings per Share

Basic earnings per share is computed by dividing net income, after the deduction of preferred stock dividends and undistributed earnings allocated to participating securities, by the weighted average number of common shares outstanding during the period.

Diluted earnings per share assumes the issuance of common stock for all potentially dilutive share equivalents outstanding not classified as participating securities.

Participating securities are defined as unvested stock-based compensation awards that contain nonforfeitable rights to dividends.

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands, except per share values) 2025 2024

Net income (loss) $ 66,648 $ 65,256 $ 197,021 $ ( 17,827 )

Net income $ 59,605 $ 58,139

Preferred stock dividends ( 10 ) ( 10 )

Net income (loss) attributable to common equity 66,638 65,246 196,991 ( 17,857 )

Net income attributable to common equity 59,595 58,129

Dividends and undistributed earnings allocated to participating securities ( 5 ) ( 7 )

Net income (loss) attributable to common shareholders 66,632 65,238 196,972 ( 17,873 )

Net income attributable to common shareholders 59,590 58,122

Basic weighted-average shares outstanding 39,334 39,360

Stock-based compensation awards (a)

133 147 160 —

Stock-based compensation awards 167 196

Diluted weighted-average shares outstanding 39,501 39,556

Antidilutive shares — —

Earnings (loss) per share:

Earnings per share:

Basic $ 1.51 $ 1.48

Diluted $ 1.51 $ 1.47

(a) During periods in which the Company incurs a net loss, stock-based compensation awards are excluded from the computation of diluted earnings per share because their effect would be anti-dilutive.

As such, during periods in which the Company incurs a net loss, diluted weighted-average shares outstanding are equivalent to basic weighted-average shares outstanding.

Note 11— Income Taxes

The Company's effective tax rate for the three months ended September 30, 2024, was 24.4 %, which differs from the United States of America ("U.S.") federal statutory rate of 21% primarily due to state income taxes.

The Company's effective tax rate for the three months ended September 30, 2023, was 25.6 %, which differs from the U.S.

federal statutory rate of 21% primarily due to higher earnings in higher tax jurisdictions and nondeductible compensation.

The Company's effective tax rate for the nine months ended September 30, 2024, was 23.7 %, which differs from the United States of America ("U.S.") federal statutory rate of 21% primarily due to state income taxes and nondeductible compensation.

The Company's effective tax rate for the nine months ended September 30, 2023, was 116.6 %, which differs from the U.S.

federal statutory rate of 21% primarily due to the divestiture of MSA LLC and the non-deductible loss recorded on the derecognition of the product liability reserves and related assets.

Refer to Note 17—Commitments and Contingencies to the unaudited condensed consolidated financial statements in Part I Item 1 of this Form 10-Q for further information on this transaction.

At September 30, 2024, the Company had a gross liability for unrecognized tax benefits of $ 7.2 million.

The Company has recognized tax benefits associated with these liabilities of $ 0.6 million at September 30, 2024.

The Company's effective tax rate for the three months ended March 31, 2025, was 23.5 %, which differs from the United States of America ("U.S.") federal statutory rate of 21% primarily due to state income taxes.

The Company's effective tax rate for the three months ended March 31, 2024, was 23.1 %, which differs from the U.S.

federal statutory rate of 21% primarily due to state income taxes and nondeductible compensation.

At March 31, 2025, the Company had a gross liability for unrecognized tax benefits of $ 1.3 million.

The Company has no recognized tax benefits associated with these liabilities at March 31, 2025.

The gross liability includes amounts associated with foreign tax exposure in prior periods.

The Company recognizes interest and penalties related to unrecognized tax benefits in interest expense and operating expenses, respectively.

The Company's liability for accrued interest related to uncertain tax positions was $ 0.2 million at September 30, 2024.

The Company's liability for accrued interest related to uncertain tax positions was $ 0.2 million at March 31, 2025.

We are subject to regular review and audit by both foreign and domestic tax authorities.

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Note 12— Stock Plans

The 2023 Management Equity Incentive Plan provides for various forms of stock-based compensation for eligible employees through May 2033 including stock options, restricted stock awards, restricted stock units and performance stock units.

The 2024 Non-Employee Directors’ Equity Incentive Plan provides for grants of stock options, restricted stock awards and restricted stock units to non-employee directors through May 2034.

Stock compensation expense, included in Selling, general and administrative expense in the unaudited Condensed Consolidated Statements of Operations, is as follows:

Three Months Ended September 30, Nine Months Ended September 30,

The 2023 Management Equity Incentive Plan and its predecessor, the 2016 Management Equity Incentive Plan, provide for various forms of stock-based compensation for eligible employees through, in the case of the 2023 Management Equity Incentive Plan, May 2033, including stock options, restricted stock awards, restricted stock units and performance stock units.

The 2024 Non-Employee Directors’ Equity Incentive Plan and its predecessor, the 2017 Non-Employee Directors’ Equity Incentive Plan, provide for grants of stock options and restricted stock to non-employee directors through May 2034.

The 2014 MSA Employee Stock Purchase Plan (“ESPP”) permits eligible employees to purchase the Company's shares of common stock at a 15 % discount from the fair market value stock price, semi-annually.

The ESPP plan is considered a compensatory plan.

The discount is recorded as a component of selling, general and administrative expense in the Company's Consolidated Statements of Income.

Stock compensation expense, included in Selling, general and administrative expense in the unaudited Condensed Consolidated Statements of Income, is as follows:

Three Months Ended March 31,

(In thousands) 2025 2024

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We have not capitalized any stock-based compensation expense.

A summary of stock option activity for the nine months ended September 30, 2024, is as follows:

A summary of stock option activity for the three months ended March 31, 2025, is as follows:

Shares Weighted Average

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Exercised ( 5,173 ) 44.50

Forfeited ( 852 ) 48.65

Outstanding and exercisable at September 30, 2024 15,153 $ 45.10

Outstanding and exercisable at March 31, 2025 9,845 $ 45.41

Restricted stock awards and restricted stock units are valued at the market value of the stock on the grant date.

A summary of restricted stock activity for the nine months ended September 30, 2024, is as follows:

A summary of restricted stock activity for the three months ended March 31, 2025, is as follows:

Shares Weighted Average

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Forfeited ( 7,648 ) 153.94

Unvested at September 30, 2024 182,678 $ 150.16

Unvested at March 31, 2025 195,783 $ 154.72

Performance stock units that have a market condition modifier are valued at an estimated fair value using a Monte Carlo model.

The final number of shares to be issued for performance stock units granted in the first quarter of 2024 may range from 0 % to 200 % of the target award based on achieving the specified performance targets over the performance period plus an additional modifier based on total shareholder return ("TSR") over the performance period.

The final number of shares to be issued for performance stock units granted in the first quarter of 2025 may range from 0 % to 200 % of the target award based on achieving the specified performance targets over the performance period and further range based upon the achieved market metric over the performance period.

The following weighted average assumptions were used in estimating the fair value of the performance stock units granted in the first quarter of 2025.

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Expected life is based on historical stock option exercise data.

A summary of performance stock unit activity for the nine months ended September 30, 2024, is as follows:

A summary of performance stock unit activity for the three months ended March 31, 2025, is as follows:

Shares Weighted Average

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Forfeited ( 15,852 ) 154.55

Unvested at September 30, 2024 162,333 $ 146.50

(a) Performance adjustments relate primarily to the final number of shares issued for the 2021 performance unit awards which vested in the first quarter of 2024 at 174 % of the target award based on both cumulative performance against EBITDA margin and revenue growth targets and MSA's TSR during the three -year performance period.

Unvested at March 31, 2025 147,401 $ 152.03

(a) Performance adjustments relate primarily to the final number of shares issued for the 2022 performance unit awards which vested in the first quarter of 2025 at 220 % of the target award based on both cumulative performance against EBITDA margin and revenue growth targets and MSA's total shareholder return during the three-year performance period.

Note 13— Long-Term Debt

(In thousands) September 30, 2024 December 31, 2023

(In thousands) March 31, 2025 December 31, 2024

2016 Senior Notes payable through 2031, 3.40 %, net of debt issuance costs

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49,956 49,953

Senior revolving credit facility maturing in 2026, net of debt issuance costs 36,153 59,602

Total 502,057 508,013

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The Company pays a credit spread of 0 to 175 basis points based on the Company’s net EBITDA leverage ratio and elected rate (BASE or SOFR).

The Company has a weighted average revolver interest rate of 5.80 % as of September 30, 2024.

At September 30, 2024, $ 861.5 million of the existing $ 900.0 million Revolving Credit Facility was unused, including letters of credit issued under the Facility.

At March 31, 2025, we had no borrowings outstanding under our $ 900.0 million senior revolving credit facility.

The facility also provides an accordion feature that allows the Company to access an additional $ 400.0 million of capacity pending approval by MSA’s board of directors and from the bank group.

On January 5, 2023, the Company entered into a new $ 250 million term loan facility to fund the divestiture of MSA LLC, a wholly owned subsidiary.

Under the agreement, the Company may elect either BASE or an interest rate based on SOFR.

The Company pays a credit spread of 0 to 200 basis points based on the Company's net EBITDA leverage ratio and elected rate.

The Company had a Term Loan interest rate of 5.30 % as of March 31, 2025.

On April 1, 2025, the Company entered into a Fifth Amended and Restated Credit Agreement (the “Amended Revolving Credit Facility” or “Amended Facility”) that extended its term through April 1, 2030, and increased the capacity to $ 1.3 billion.

As part of the Amended Facility, we have converted $ 207.3 million, inclusive of our $ 206.3 million 2023 Term Loan credit agreement and $ 1.0 million of accrued interest related to the 2023 Term Loan, into the Amended Revolving Credit Facility’s capacity.

On July 1, 2024, the Company entered into Amendment No.

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The Prudential Note Agreement provided for (i) the issuance of $ 100.0 million of 2.69 % Series C Senior Notes due July 1, 2036 and (ii) the establishment of an uncommitted note issuance facility whereby the Company may request, subject to Prudential’s acceptance in its sole discretion, the issuance of up to $ 335.0 million aggregate principal amount of senior unsecured notes.

As of September 30, 2024, the Company has outstanding £ 42.7 million (approximately $ 57.2 million at September 30, 2024) of 3.4 % Series B Senior Notes due January 22, 2031.

Remaining maturities of this note are £ 6.1 million (approximately $ 8.2 million at September 30, 2024) due annually through January 2031.

As of March 31, 2025, the Company has outstanding £ 36.6 million (approximately $ 47.3 million at March 31, 2025) of 3.4 % Series B Senior Notes due January 22, 2031.

Remaining maturities of this note are £ 6.1 million (approximately $ 7.9 million at March 31, 2025) due annually through January 2031.

On July 1, 2024, the Company entered into Amendment No.

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The NYL Note Facility provided for (i) the issuance of $ 100.0 million of 2.69 % Series A Senior Notes due July 1, 2036, and (ii) the establishment of an uncommitted note issuance facility whereby the Company may request, subject to NYL Investors’ acceptance in its sole discretion, the issuance of up to $ 200.0 million aggregate principal amount of senior unsecured notes.

Coincident with the amendment to the Revolving Credit Facility on April 1, 2025, the Company entered into Amendment No.

4 to the Prudential Note Agreement and Amendment No.

4 to the NYL Note Facility, in each case to conform to the changes made in the Amended Revolving Credit Facility.

On June 29, 2023, the Company issued $ 50 million of 5.25 % Series B Senior Notes due July 1, 2028, pursuant to the NYL Note Facility (the "Notes").

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The proceeds of the Notes were used on June 29, 2023, to pay down an equivalent amount of borrowings under the Company’s Revolving Credit Facility with PNC Bank, National Association, as Administrative Agent.

On January 5, 2023, the Company entered into a new $ 250 million term loan facility to fund the divestiture of MSA LLC, a wholly owned subsidiary.

Under the agreement, the Company may elect either BASE or an interest rate based on SOFR.

The Company pays a credit spread of 0 to 200 basis points based on the Company's net EBITDA leverage ratio and elected rate.

The Company had a Term Loan interest rate of 6.35 % as of September 30, 2024.

The Revolving Credit Facility, Prudential Note Agreement and NYL Note Facility require the Company to comply with specified financial covenants, including a requirement to maintain a minimum fixed charges coverage ratio of not less than 1.50 to 1.00 and a consolidated leverage ratio not to exceed 3.50 to 1.00;

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In addition, the agreements contain negative covenants limiting the ability of the Company and its subsidiaries to incur additional indebtedness or issue guarantees, create or incur liens, make loans and investments, make acquisitions, transfer or sell assets, enter into transactions with affiliated parties, make changes in its organizational documents that are materially adverse to lenders or modify the nature of the Company's or its subsidiaries' business.

All credit facilities exclude MSA LLC prior to the divestiture of this subsidiary on January 5, 2023, as discussed further in Note 17—Commitments and Contingencies to the unaudited condensed consolidated financial statements in Part I Item 1 of this Form 10-Q for further information on this transaction.

As of September 30, 2024, the Company was in full compliance with the restrictive covenants under its various credit agreements.

The Company had outstanding bank guarantees and standby letters of credit with banks as of September 30, 2024, totaling $ 10.0 million, of which $ 1.5 million relate to the Revolving Credit Facility.

As of March 31, 2025, the Company was in full compliance with the restrictive covenants under its various credit agreements.

The Company had outstanding bank guarantees and standby letters of credit with banks as of March 31, 2025, totaling $ 9.5 million, of which $ 1.5 million relate to the Revolving Credit Facility.

The letters of credit serve to cover customer requirements in connection with certain sales orders and insurance companies.

The Company is also required to provide cash collateral in connection with certain arrangements.

At September 30, 2024, the Company has $ 0.6 million of restricted cash in support of these arrangements.

As of March 31, 2025, the Company has $ 0.7 million of restricted cash in support of these arrangements.

Note 14— Goodwill and Intangible Assets, Net

Changes in goodwill during the nine months ended September 30, 2024, were as follows:

Changes in goodwill during the three months ended March 31, 2025, were as follows:

(In thousands) Goodwill

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Currency translation 6,305

Balance at September 30, 2024 $ 632,837

At September 30, 2024, goodwill of $ 447.6 million and $ 185.2 million related to the Americas and International reportable segments, respectively.

Changes in intangible assets, net, during the nine months ended September 30, 2024, were as follows:

Balance at March 31, 2025 $ 627,200

At March 31, 2025, goodwill of $ 447.6 million and $ 179.6 million related to the Americas and International reportable segments, respectively.

Changes in intangible assets, net, during the three months ended March 31, 2025, were as follows:

(In thousands) Intangible Assets

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Currency translation 1,769

Net balance at September 30, 2024 $ 254,364

At September 30, 2024, intangible assets, net, includes a trade name related to Globe Manufacturing Company, LLC ("Globe") with an indefinite life totaling $ 60.0 million .

Net balance at March 31, 2025 $ 243,800

At March 31, 2025, intangible assets, net, includes a trade name related to Globe Manufacturing Company, LLC ("Globe") with an indefinite life totaling $ 60.0 million .

Note 15— Pensions and Other Post-retirement Benefits

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(In thousands) 2025 2024 2025 2024

Three Months Ended September 30,

Service cost $ 2,315 $ 1,884 $ 44 $ 53

Interest cost 5,970 5,918 248 273

Expected return on plan assets ( 10,812 ) ( 9,906 ) — —

Amortization of prior service cost (credit) 37 37 ( 46 ) ( 61 )

Recognized net actuarial losses 282 47 115 138

Net periodic benefit (income) cost (a)

$ ( 2,208 ) $ ( 2,020 ) $ 361 $ 403

Nine Months Ended September 30,

Three Months Ended March 31,

Service cost $ 1,994 $ 2,315 $ 31 $ 44

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Recognized net actuarial losses 197 282 163 115

Settlements 1,308 —

Net periodic benefit (income) cost (a)

$ ( 3,848 ) $ ( 2,208 ) $ 470 $ 361

(a) Components of Net periodic benefit (income) cost other than service cost are included in the line item Other income, net, and service costs are included in the line items Cost of products sold and Selling, general and administrative in the unaudited Condensed Consolidated Statements of Operations.

We made contributions of $ 3.9 million and $ 4.3 million to our pension plans during the nine months ended September 30, 2024, and 2023, respectively.

We expect to make net contributions of $ 5.3 million to our pension plans in 2024, which are primarily associated with statutorily required plans in the International reporting segment.

We made contributions of $ 1.8 million and $ 1.3 million to our pension plans during the three months ended March 31, 2025, and 2024, respectively.

We expect to make net contributions between $ 6 million and $ 8 million to our pension plans in 2025, which are primarily associated with statutorily required plans in the International reporting segment.

Note 16— Derivative Financial Instruments

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GAAP criteria for hedge accounting but have the impact of partially offsetting certain of our foreign currency exposures.

We account for these forward contracts at fair value and report the related gains or losses in currency exchange losses, net, in the unaudited Condensed Consolidated Statements of Operations.

The notional amount of open forward contracts was $ 184.8 million and $ 110.9 million at September 30, 2024, and December 31, 2023, respectively.

We account for these forward contracts at fair value and report the related gains or losses in currency exchange losses, net, in the unaudited Condensed Consolidated Statements of Income.

The notional amount of open forward contracts was $ 150.7 million and $ 184.0 million at March 31, 2025, and December 31, 2024, respectively.

The following table presents the unaudited Condensed Consolidated Balance Sheets location and fair value of assets and liabilities associated with derivative financial instruments:

(In thousands) September 30, 2024 December 31, 2023

(In thousands) March 31, 2025 December 31, 2024

Derivatives not designated as hedging instruments:

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other current liabilities 146 1,111

The following table presents the unaudited Condensed Consolidated Statements of Operations and unaudited Condensed Consolidated Statements of Cash Flows location and the loss impact of derivative financial instruments:

Nine Months Ended September 30,

The following table presents the amount and classification of the (gain) loss associated with derivative financial instruments within the unaudited Condensed Consolidated Statements of Income and unaudited Condensed Consolidated Statements of Cash Flows:

Three Months Ended March 31,

(In thousands) 2025 2024

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With the exception of our fixed rate long-term debt, we believe that the reported carrying amounts of our financial assets and liabilities approximate their fair values.

The reported carrying amount of our fixed rate long-term debt was $ 307.2 million and $ 312.2 million at September 30, 2024, and December 31, 2023, respectively.

The fair value of this debt was $ 278.1 million and $ 278.7 million at September 30, 2024, and December 31, 2023, respectively.

The reported carrying amount of our fixed rate long-term debt was $ 297.3 million and $ 303.5 million at March 31, 2025, and December 31, 2024, respectively.

The fair value of this debt was $ 263.0 million and $ 266.4 million at March 31, 2025, and December 31, 2024, respectively.

The fair value of this debt was determined using Level 2 inputs by evaluating similarly rated companies with publicly traded bonds where available or current borrowing rates available for financings with similar terms and maturities.

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Product liability

The Company and its subsidiaries face an inherent business risk of exposure to legal claims arising from the alleged failure of our products to prevent the types of personal injury or death against which they are designed to protect.

Product liability claims are categorized as either single incident or cumulative trauma.

The Company and its subsidiaries face an inherent business risk of exposure to product liability claims arising from the alleged failure of our products to prevent the types of personal injury or death against which they are designed to protect.

Single incident product liability claims.

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To determine the reserves, Management makes reasonable estimates of losses for single incident claims based on the number and characteristics of asserted claims, historical experience, sales volumes, expected settlement costs, and other relevant information.

The reserve for single incident product liability claims was $ 0.8 million at September 30, 2024 and $ 1.3 million at December 31, 2023.

Single incident product liability benefit was $ 0.2 million and $ 0.1 million for the nine months ended September 30, 2024, and 2023, respectively.

Single incident product liability exposures are evaluated on an annual basis, or more frequently if changing circumstances warrant.

Adjustments are made to the reserve as appropriate.

The reserve has not been discounted to present value and does not include future amounts which will be spent to defend the claims.

During the first nine months of 2024, the Company recorded $ 5.0 million of net cost for product related legal matter.

The expense is reflected within the selling, general and administration line of the unaudited Condensed Consolidated Statement of Operations.

Cumulative trauma product liability claims.

Cumulative trauma product liability claims involve alleged exposures to harmful substances (e.g., silica, asbestos and coal dust) that occurred years ago and may have developed over long periods of time into diseases such as silicosis, asbestosis, mesothelioma, or coal worker’s pneumoconiosis.

Prior to the divestiture described below, one of the Company's former subsidiaries, MSA LLC, was named as a defendant in various lawsuits related to such claims.

A former subsidiary of the Company, Mine Safety Appliances Company, LLC ("MSA LLC"), which was divested on January 5, 2023, under a membership interest purchase agreement (the "Purchase Agreement") with Sag Main Holdings LLC (the "Purchaser"), as further described in the Company’s Current Report on Form 8-K filed on January 6, 2023, has been named as a defendant in various lawsuits related to such claims.

These lawsuits mainly involve respiratory protection products allegedly manufactured and sold by MSA LLC or its predecessors.

On January 5, 2023, the Company entered into a membership interest purchase agreement (the “Purchase Agreement”) with Sag Main Holdings, LLC (the “Buyer”).

The Buyer was a joint venture between R&Q Insurance Holdings Ltd.

(“R&Q”) and Obra Capital, Inc.

Under the Purchase Agreement, on January 5, 2023, the Company transferred to the Buyer all of the issued and outstanding limited liability company interests of MSA LLC (the “Sale”).

In connection with the closing, the Company contributed $ 341.2 million in cash and cash equivalents, while R&Q and Obra contributed an additional $ 35.0 million.

MSA LLC was the obligor for the claims to which the Company's legacy cumulative trauma product liability reserves relate and policyholder of the related insurance assets.

The rights and obligations related to these items remained with MSA LLC upon the sale to the Buyer.

In addition, pursuant to the Purchase Agreement, the Buyer and MSA LLC have agreed to indemnify the Company and its affiliates for legacy cumulative trauma product liabilities and other product liabilities, and a subsidiary of the Company has agreed to indemnify MSA LLC for all other historical liabilities of MSA LLC.

As MSA LLC was the obligor for the claims to which the Company's legacy cumulative trauma product liability reserves relate and policyholder of the related insurance assets, the rights and obligations related to these items remained with MSA LLC when it transferred to the Purchaser's ownership pursuant to the Purchase Agreement.

In addition, pursuant to the Purchase Agreement, the Purchaser and MSA LLC have agreed to indemnify the Company and its affiliates for legacy cumulative trauma product liabilities and other product liabilities, and a subsidiary of the Company has agreed to indemnify MSA LLC for all other historical liabilities of MSA LLC.

This indemnification is not subject to any cap or time limitation.

In connection with the sale, the Company and its Board of Directors received a solvency opinion from an independent advisory firm that MSA LLC was solvent and adequately capitalized after giving effect to the transaction.

Following the completion of the transaction, the Company no longer has any obligation with respect to pending and future cumulative trauma product liability claims relating to these matters.

As such, all legacy cumulative trauma product liability reserves, related insurance assets, and associated deferred tax assets of the divested subsidiary were derecognized from our balance sheet and the Company incurred a tax-effected loss on the divestiture of MSA LLC of $ 199.6 million, including transaction related costs of $ 5.6 million.

The Buyer has assumed management of the divested subsidiary, including the management of its claims and associated assets.

Other Litigation

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These matters are at a very early stage with numerous factual and legal issues to be resolved.

Defense costs relating to these lawsuits are recognized in the unaudited Condensed Consolidated Statements of Operations as incurred.

Defense costs relating to these lawsuits are recognized in the unaudited Condensed Consolidated Statements of Income as incurred.

Globe is also pursuing insurance coverage and indemnification related to the lawsuits.

As of October 15, 2024, Globe was named as a defendant in 535 lawsuits comprised of 7,850 claims, predominantly styled as individual personal injury claims and including two putative class actions.

As of April 22, 2025, Globe was named as a defendant in 731 lawsuits comprised of 9,274 claims, predominantly styled as individual personal injury claims and including several putative class actions.

Certain of these lawsuits include MSA Safety Inc.

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MSA LLC is also a defendant in a number of PFAS lawsuits predominantly relating to Aqueous Film-Forming Foam.

The Buyer assumed responsibility for these and any similar future claims specific to MSA LLC, including such claims that have been or may be brought against MSA Safety Inc.

or its subsidiaries, under the terms of the divestiture on January 5, 2023.

Further information about the transaction can be found in the Company’s Current Report on Form 8-K filed on January 6, 2023.

The purchaser assumed responsibility for these and any similar future claims specific to MSA LLC, including such claims that have been or may be brought against MSA Safety Inc.

or its subsidiaries, under the terms of the purchase agreement governing the Company's January 5, 2023, divestiture of MSA LLC.

Further information about the transaction and the purchase agreement can be found in the Company’s Current Report on Form 8-K filed on January 6, 2023.

Product Warranty

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The following table reconciles changes in the Company's accrued warranty reserve:

(In thousands) Nine Months Ended September 30, 2024 Year Ended

(In thousands) Three Months Ended March 31, 2025 Year Ended

December 31, 2024

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Warranty payments ( 3,650 ) ( 11,802 )

Warranty claims 7,370 8,899

Provision for product warranties and other adjustments 515 ( 47 )

Warranty claims, current 2,790 10,684

Warranty claims, preexisting 319 765

Currency translation and other adjustments 101 ( 211 )

Ending warranty reserve $ 13,284 $ 13,724

Warranty expense was $ 7.9 million and $ 6.7 million for the nine months ended September 30, 2024, and 2023, respectively, and is included in Costs of products sold on the unaudited Condensed Consolidated Statements of Operations.

Outstanding Performance Obligations

The Company derives a portion of its revenue from various leasing arrangements where the Company is the lessor, primarily fire service contracts entered into by Bristol.

Such arrangements provide for monthly payments covering equipment provided, maintenance and interest.

These arrangements meet the criteria to be accounted for as sales-type leases under Accounting Standards Codification ("ASC") 842 and contain both lease and non-lease components.

Revenue from equipment provided is considered a lease component and recognized with point in time revenue recognition upon lease commencement.

Maintenance revenue, which is considered a non-lease component, and interest is recognized monthly over the lease term.

As of September 30, 2024, the Company had remaining maintenance performance obligations of approximately $ 28.7 million which are expected to be recognized to revenue in approximately three years .

Warranty expense was $ 3.2 million and $ 2.1 million for the three months ended March 31, 2025, and 2024, respectively, and is included in Costs of products sold on the unaudited Condensed Consolidated Statements of Income.

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