PREFORMED LINE PRODUCTS CO 10-Q

ITEM 1. FINANCIAL STATEMENTS PREFORMED LINE PRODUCTS COMPANY CONSOLIDATED BALANCE SHEETS March 31, 2026 December 31, 2025 (Thousands of dollars, except share and per share data) (Unaudited) ASSETS Cash, cash equivalents and restricted cash $ 69,452 $ 83,389 Accounts receivable, net 130,840 113,175 Inventories, net 151,810 148,730 Prepaid expenses 12,998 12,961 Other current assets 6,287 5,206 TOTAL CURRENT ASSETS 371,387 363,461 Property, plant and equipment, net 225,279 222,781 Operating lease, right-of-use assets 9,160 9,708 Goodwill 30,351 30,684 Other intangible assets, net 9,837 10,140 Deferred income taxes 6,794 7,481 Other assets 9,021 9,366 TOTAL ASSETS $ 661,829 $ 653,621 LIABILITIES AND SHAREHOLDERS' EQUITY Trade accounts payable $ 56,766 $ 49,520 Notes payable to banks 1,318 1,213 Operating lease liabilities, current 1,546 1,722 Current portion of long-term debt 5,891 5,392 Accrued compensation and other benefits 24,084 29,207 Accrued expenses and other liabilities 29,644 22,407 Dividends payable 1,175 1,277 Income taxes payable 3,167 3,972 TOTAL CURRENT LIABILITIES 123,591 114,710 Long-term debt, less current portion 34,737 32,860 Operating lease liabilities, noncurrent 5,513 5,957 Deferred income taxes 5,463 5,707 Other noncurrent liabilities 18,943 18,836 SHAREHOLDERS' EQUITY Common shares $ 2 par value per share, 15,000,000 shares authorized, 4,888,012 and 4,907,787 issued and outstanding, at March 31, 2026 and December 31, 2025 13,890 13,860 Common shares issued to rabbi trust, 222,506 and 222,506 shares at March 31, 2026 and December 31, 2025, respectively ( 9,586 ) ( 9,586 ) Deferred compensation liability 9,586 9,586 Paid-in capital 66,047 67,217 Retained earnings 593,869 584,360 Treasury shares, at cost, 2,056,379 and 2,021,940 shares at March 31, 2026 and December 31, 2025, respectively ( 145,492 ) ( 136,554 ) Accumulated other comprehensive loss ( 54,790 ) ( 53,365 ) TOTAL PREFORMED LINE PRODUCTS COMPANY SHAREHOLDERS' EQUITY 473,524 475,518 Noncontrolling interest 58 33 TOTAL SHAREHOLDERS' EQUITY 473,582 475,551 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 661,829 $ 653,621 See notes to consolidated financial statements (unaudited). 3 PREFORMED LINE PRODUCTS COMPANY STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED) Three Months Ended March 31, 2026 2025 (Thousands, except per share data) Net sales $ 176,278 $ 148,541 Cost of products sold 121,058 99,870 GROSS PROFIT 55,220 48,671 Costs and expenses Selling 13,769 12,181 General and administrative 21,053 17,626 Research and engineering 6,736 5,479 Other operating (income) expense, net ( 54 ) 255 41,504 35,541 OPERATING INCOME 13,716 13,130 Other income (expense) Interest income 777 510 Interest expense ( 232 ) ( 376 ) Other income, net 69 407 614 541 INCOME BEFORE INCOME TAXES 14,330 13,671 Income tax expense 3,781 2,118 NET INCOME $ 10,549 $ 11,553 Net income attributable to noncontrolling interests ( 25 ) ( 36 ) NET INCOME ATTRIBUTABLE TO PREFORMED LINE PRODUCTS COMPANY SHAREHOLDERS $ 10,524 $ 11,517 AVERAGE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING: Basic 4,906 4,928 Diluted 4,927 4,950 EARNINGS PER SHARE OF COMMON STOCK ATTRIBUTABLE TO PREFORMED LINE PRODUCTS COMPANY SHAREHOLDERS: Basic $ 2.15 $ 2.34 Diluted $ 2.14 $ 2.33 See notes to consolidated financial statements (unaudited). 4 PREFORMED LINE PRODUCTS COMPANY STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (UNAUDITED) Three Months Ended March 31, 2026 2025 (Thousands of dollars) Net income $ 10,549 $ 11,553 Other comprehensive (loss) income, net of tax: Foreign currency translation adjustment ( 1,425 ) 6,671 Pension adjustment, net of tax - 123 Other comprehensive (loss) income, net of tax ( 1,425 ) 6,794 Comprehensive income attributable to noncontrolling interests ( 25 ) ( 36 ) COMPREHENSIVE INCOME ATTRIBUTABLE TO PREFORMED LINE PRODUCTS COMPANY SHAREHOLDERS $ 9,099 $ 18,311 See notes to consolidated financial statements (unaudited). 5 PREFORMED LINE PRODUCTS COMPANY STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED) Three Months Ended March 31, 2026 2025 (Thousands of dollars) OPERATING ACTIVITIES Net income $ 10,549 $ 11,553 Adjustments to reconcile net income to net cash provided by operations: Depreciation and amortization 6,166 5,397 Deferred income taxes 403 ( 479 ) Share-based compensation expense 2,345 892 Loss (gain) on sale of property and equipment 27 ( 37 ) Other, net 356 ( 228 ) Changes in operating assets and liabilities ( 13,799 ) ( 11,443 ) NET CASH PROVIDED BY OPERATING ACTIVITIES 6,047 5,655 INVESTING ACTIVITIES Capital expenditures ( 9,993 ) ( 10,976 ) Proceeds from the sale of property and equipment 49 91 Proceeds from sale of investments — 1,679 Purchases of investments — ( 451 ) NET CASH USED IN INVESTING ACTIVITIES ( 9,944 ) ( 9,657 ) FINANCING ACTIVITIES Proceeds (payments) of notes payable to banks 186 ( 1,966 ) Proceeds from long-term debt 5,003 8,628 Payments of long-term debt ( 1,612 ) ( 777 ) Dividends paid ( 1,116 ) ( 1,164 ) Proceeds from issuance of common shares 450 68 Stock incentive plan payments ( 3,935 ) ( 3,799 ) Purchase of common shares for treasury ( 652 ) ( 131 ) Purchase of common shares for treasury from related parties ( 8,286 ) ( 881 ) NET CASH USED IN FINANCING ACTIVITIES ( 9,962 ) ( 22 ) Effects of exchange rate changes on cash, cash equivalents and restricted cash ( 78 ) 1,615 Net decrease in cash, cash equivalents and restricted cash ( 13,937 ) ( 2,409 ) Cash, cash equivalents and restricted cash at beginning of year 83,389 57,244 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD $ 69,452 $ 54,835 See notes to consolidated financial statements (unaudited). 6 PREFORMED LINE PRODUCTS COMPANY STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY Accumulated Other Comprehensive Income (Loss) (In thousands, except share and per share data) Common Shares Common Shares Issued to Rabbi Trust Deferred Compensation Liability Paid in Capital Retained Earnings Treasury Shares Cumulative Translation Adjustment Unrecognized Pension Benefit Cost Total Preformed Line Products Company Equity Noncontrolling Interests Total Equity Balance at December 31, 2025 $ 13,860 $ ( 9,586 ) $ 9,586 $ 67,217 $ 584,360 $ ( 136,554 ) $ ( 53,365 ) $ — $ 475,518 $ 33 $ 475,551 Net income 10,524 10,524 25 10,549 Foreign currency translation adjustment ( 1,425 ) ( 1,425 ) ( 1,425 ) Pension adjustment, net of tax — — Total comprehensive income 9,099 25 9,124 Purchase of 34,439 common shares ( 8,938 ) ( 8,938 ) ( 8,938 ) Stock incentive plan activity 30 ( 1,170 ) ( 1,140 ) ( 1,140 ) Common shares issued to rabbi trust of 0 , net — — Cash dividends declared – $ 0.21 per share ( 1,015 ) ( 1,015 ) ( 1,015 ) Balance at March 31, 2026 $ 13,890 $ ( 9,586 ) $ 9,586 $ 66,047 $ 593,869 $ ( 145,492 ) $ ( 54,790 ) $ — $ 473,524 $ 58 $ 473,582 Accumulated Other Comprehensive Income (Loss) (In thousands, except share and per share data) Common Shares Common Shares Issued to Rabbi Trust Deferred Compensation Liability Paid in Capital Retained Earnings Treasury Shares Cumulative Translation Adjustment Unrecognized Pension Benefit Cost Total Preformed Line Products Company Equity Noncontrolling Interests Total Equity Balance at December 31, 2024 $ 13,752 $ ( 9,575 ) $ 9,575 $ 65,093 $ 553,179 $ ( 126,800 ) $ ( 77,536 ) $ ( 5,373 ) $ 422,315 $ 9 $ 422,324 Net income 11,517 11,517 36 11,553 Foreign currency translation adjustment 6,671 6,671 6,671 Pension adjustment, net of tax 123 123 123 Total comprehensive income 18,311 36 18,347 Purchase of 860 common shares ( 131 ) ( 131 ) ( 131 ) Stock incentive plan activity 68 ( 2,888 ) ( 881 ) ( 3,701 ) ( 3,701 ) Common shares distributed from rabbi trust of 147 , net ( 19 ) 19 — — Cash dividends declared – $ 0.20 per share ( 1,018 ) ( 1,018 ) ( 1,018 ) Balance at March 31, 2025 $ 13,820 $ ( 9,594 ) $ 9,594 $ 62,205 $ 563,678 $ ( 127,812 ) $ ( 70,865 ) $ ( 5,250 ) $ 435,776 $ 45 $ 435,821 See notes to consolidated financial statements (unaudited). 7 PREFORMED LINE PRODUCTS COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Tables in thousands of dollars, except share and per share data, unless specifically noted) NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited consolidated financial statements of Preformed Line Products Company and subsidiaries (the “Company” or “PLPC”) have been prepared in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. This Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in our Form 10-K for the year ended December 31, 2025 filed on March 5, 2026 with the Securities and Exchange Commission. Management has evaluated subsequent events through the date this Form 10-Q was filed with the Securities and Exchange Commission. The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Actual results could differ from these estimates. In the opinion of management, these consolidated financial statements contain all estimates and adjustments, consisting of normal recurring accruals, required to fairly present the financial position, results of operations, and cash flows for the interim periods. Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for the full-year ending December 31, 2026. Noncontrolling interests are presented in the Company’s consolidated financial statements as if parent company investors (controlling interests) and other minority investors (noncontrolling interests) in partially-owned subsidiaries have similar economic interests in a single entity. As a result, investments in noncontrolling interests are reported as equity in the Company’s consolidated financial statements. Additionally, the Company’s consolidated financial statements include 100 % of a controlled subsidiary’s earnings, rather than only its share. Transactions between the parent company and noncontrolling interests are reported in equity as transactions between stockholders, provided that these transactions do not create a change in control. Recently Adopted or Issued Accounting Pronouncements and Regulations Not Yet Adopted In November 2024, the FASB issued Accounting Standards Update No. 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” This ASU improves disclosures about a public business entity’s expenses and addresses requests from investors for more detailed information about the types of expenses commonly presented in expense captions. Coupled with recent standards that enhanced the disaggregation of revenue and income tax information, the disaggregated expense information required by the amendments in this ASU will enable investors to better understand the major components of an entity’s income statement. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is evaluating the impact of adopting this ASU. In September 2025, the FASB issued Accounting Standards Update No. 2025-06, "Intangibles - Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targets Improvements to the Accounting for Internal-Use Software." This ASU removes all references to software development "project stages." Instead, capitalization begins when the following conditions are met: management has authorized funding the software project, it is probable that the project will be completed and the software will be used for its intended function. This ASU is effective for annual periods beginning after December 15, 2027, and for interim periods within those annual reporting periods, with early adoption permitted. The Company is evaluating the impact of adopting this ASU. New Regulations On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain businesses. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The implementation of OBBBA resulted in an expected cash tax savings of approximately $ 3.0 million for the Company's 2025 fiscal year end. Management is currently evaluating the potential impact of the provisions for the 2026 fiscal year. 8 NOTE 2 - REVENUE Revenue Recognition Sales are recognized when obligations under the terms of the contract are satisfied and control of promised goods or services have transferred to our customers. Control is transferred when the customer has the ability to direct the use of and obtain benefits from the goods or services and is primarily based on shipping terms. Sales are measured as the amount of consideration the Company expects to receive in exchange for transferring products. Disaggregated Revenue The Company’s revenues by segment and product type are as follows: Three Months Ended March 31, 2026 Product Type PLP-USA The Americas EMEA Asia-Pacific Consolidated Energy 67 % 75 % 73 % 77 % 71 % Communications 30 % 24 % 21 % 4 % 24 % Special Industries 3 % 1 % 6 % 19 % 5 % Total 100 % 100 % 100 % 100 % 100 % Three Months Ended March 31, 2025 Product Type PLP-USA The Americas EMEA Asia-Pacific Consolidated Energy 60 % 84 % 75 % 76 % 69 % Communications 35 % 15 % 22 % 3 % 25 % Special Industries 5 % 1 % 3 % 21 % 6 % Total 100 % 100 % 100 % 100 % 100 % Credit Losses for Receivables The Company maintains an allowance for credit losses for estimated losses resulting from the inability of its customers to make required payments. The Company uses a current expected credit loss model in order to immediately recognize an estimate of credit losses that are expected to occur over the life of the financial instruments, mainly trade receivables. Additionally, the allowance is based upon identified delinquent accounts, customer payment patterns and other analyses of historical data trends. Receivable balances are written off against an allowance for credit losses after a final determination has been made. The change in the allowance for credit losses includes expense and net write-offs, which are identified in the following table: Three Months Ended March 31, 2026 2025 Allowance for credit losses, beginning of period $ 5,797 $ 6,958 Additions (reductions) charged to costs and expenses 439 ( 67 ) Write-offs — — Foreign exchange and other 57 13 Allowance for credit losses, end of period $ 6,293 $ 6,904 9 NOTE 3 - INVENTORIES, NET Inventories, net Inventory is carried at lower of cost or net realizable value. The components of inventory are as follows: March 31, 2026 December 31, 2025 Raw materials $ 98,094 $ 95,988 Work-in-process 17,316 16,586 Finished products 56,314 55,442 Inventories, net of excess and obsolete inventory reserve 171,724 168,016 Excess of current cost over LIFO cost ( 19,914 ) ( 19,286 ) Inventories at LIFO cost $ 151,810 $ 148,730 Costs for inventories of certain material, mainly in the U.S., are determined using the Last-In First-Out ("LIFO") method and totaled approximately $ 45.3 million at March 31, 2026 and $ 45.8 million at December 31, 2025. An actual valuation of inventories under the LIFO method can be made only at the end of the year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on management’s estimates of expected year-end inventory levels and costs. Because these estimates are subject to change and may be different than the actual inventory levels and costs at the end of the year, interim results are subject to the final year-end LIFO inventory valuation. During the three-month periods ended March 31, 2026 and 2025, the net change in LIFO inventories resulted in an expense of $ 0.6 million and $ 0.5 million, respectively, to Cost of products sold. The Company’s reserves for excess and obsolete inventory were $ 16.9 million at March 31, 2026 and $ 17.7 million at December 31, 2025. NOTE 4 - PROPERTY AND EQUIPMENT, NET Major classes of property, plant and equipment are as follows: March 31, 2026 December 31, 2025 Land and improvements $ 26,902 $ 27,293 Buildings and improvements 134,854 131,619 Machinery, equipment and aircraft 276,037 274,919 Construction in progress 27,459 27,206 Property, plant and equipment, gross 465,252 461,037 Less accumulated depreciation ( 239,973 ) ( 238,256 ) Property, plant and equipment, net $ 225,279 $ 222,781 10 NOTE 5 - CONTINGENCIES AND OTHER LIABILITIES Contingent Liabilities The Company can be party to a variety of pending legal proceedings and claims arising in the normal course of business, including, but not limited to, litigation relating to employment, workers’ compensation, product liability, environmental and intellectual property. The Company has liability insurance to cover many of these claims. Although the outcomes of these matters are not predictable with certainty, the Company records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. In the event the Company determines that a loss is not probable, but is reasonably possible, and the likelihood to develop what the Company believes to be a reasonable range of potential loss exists, the Company will include disclosure related to such matters. To the extent that there is a reasonable possibility the losses could exceed amounts already accrued, the Company will adjust the accrual in the period in which the determination is made, disclose an estimate of the additional loss or range of loss and if the amount of such adjustment cannot be reasonably estimated, disclose that an estimate cannot be made. The Company is not a party to any pending legal proceedings that the Company believes would, individually or in the aggregate, have a material adverse effect on its financial condition, results of operations or cash flow. For the period ending March 31, 2026 and the year ending December 31, 2025, there were no reserves for known global legal matters. Advanced Customer Payments As of March 31, 2026 and December 31, 2025, the Company has included $ 11.4 million and $ 4.7 million, respectively of advanced payments by customers for future projects in Accrued expenses and other liabilities on the Consolidated Balance Sheets. Tariff Considerations In February 2026, the U.S. Supreme Court ruled that certain tariffs under the International Emergency Economic Powers Act (“IEEPA”) were invalid, and in March 2026, the U.S. Court of International Trade ruled that the U.S. Customs and Border Protection (“CBP”) must refund duties imposed under IEEPA. The Company continues to monitor the refund process, which remains uncertain. As such, the Company has not recorded any amounts in the consolidated financial statements related to any potential refunds for the period ended March 31, 2026. 11 NOTE 6 - PENSION PLANS The Company completed the termination of the Preformed Line Products Company Employees’ Retirement Plan (the “U.S. Plan”) in the third quarter of 2025 through the purchase of a group annuity contract. Prior to the termination, the U.S. Plan was amended to provide certain participants who are not currently receiving benefits the opportunity during an election period of April 1, 2025 to May 31, 2025 to elect to receive their benefit in the form of a lump sum. Lump-sum payments of approximately $ 13.1 million were made during July and August of 2025 in connection with such elections. In August 2025, the Company contributed approximately $ 2.9 million to the U.S. Plan and purchased an annuity contract through a financial institution for approximately $ 18.0 million to fully liquidate the U.S. Plan. As of the year ended December 31, 2025, the Company recorded a total non-cash pre-tax charge associated with the U.S. Plan termination of $ 11.7 million, of which $ 8.8 million represents the acceleration of deferred charges previously accrued in accumulated other comprehensive loss and $ 2.9 million represents the actuarial loss. Due to the termination of the U.S. Plan in August 2025, there was no net periodic pension expense for three months ended March 31, 2026. The following is the net periodic pension expense for the U.S. Plan for three-month period ended March 31, 2025: Three Months Ended March 31, 2025 Interest cost $ 395 Expected return on plan assets ( 351 ) Recognized net actuarial loss 161 Net periodic pension expense $ 205 The Company made no contribution to the U.S. Plan for the three-month periods ended March 31, 2026 and March 31, 2025. Components of the recurring pension expense are included in Other income, net in the Consolidated Statements of Income. NOTE 7 - ACCUMULATED OTHER COMPREHENSIVE INCOME ("AOCI") The following tables set forth the total changes in AOCI by component, net of tax: Three Months Ended March 31, 2026 Three Months Ended March 31, 2025 Unrecognized Benefit Cost Cumulative Translation Adjustment Total Unrecognized Benefit Cost Cumulative Translation Adjustment Total Balance at January 1 $ — $ ( 53,365 ) $ ( 53,365 ) $ ( 5,373 ) $ ( 77,536 ) $ ( 82,909 ) Other comprehensive income (loss) before reclassifications: Foreign currency translation adjustment — ( 1,425 ) ( 1,425 ) — 6,671 6,671 Amounts reclassified from AOCI: Amortization of defined benefit pension activity (a) — — — 123 — 123 Net current period other comprehensive (loss) income — ( 1,425 ) ( 1,425 ) 123 6,671 6,794 Balance at March 31 $ — $ ( 54,790 ) $ ( 54,790 ) $ ( 5,250 ) $ ( 70,865 ) $ ( 76,115 ) (a) This AOCI component is included in the computation of net periodic pension expense as noted in Note 6 – Pension Plans. 12 NOTE 8 - DEBT AND CREDIT ARRANGEMENTS PNC Bank Credit Facility As of March 31, 2026, the Company maintained a credit facility (the "Facility") with PNC Bank, National Association ("PNC") with a capacity of $ 60.0 million and a maturity date of June 30, 2028. The interest rate is defined as the Secured Overnight Financing Rate (“SOFR”) plus 1.225 % unless the Company’s funded debt to Earnings before Interest, Taxes and Depreciation ratio exceeds 3.00 to 1, at which point the SOFR spread becomes 1.600 %. At March 31, 2026, the Company had utilized $ 7.1 million with $ 52.9 million available on the Facility. There were no long-term outstanding letters of credit on the Facility as of March 31, 2026. Our bank debt to equity percentage was 8.9 %. The Facility contains, among other provisions, requirements for maintaining levels of net worth and profitability. At March 31, 2026, the Company was in compliance with these covenants. Corporate Aircraft Term Loan On January 19, 2021, the Company received funding for a term loan from PNC Equipment Finance, LLC in the principal amount of $ 20.5 million for the full amount of the purchase price for a new corporate aircraft. The term of the loan is 120 months at a fixed interest rate of 2.744 %. The loan is payable in 119 equal monthly installments, which commenced on March 1, 2021 with a final payment of any outstanding principal and accrued interest due and payable on the final monthly payment date. Of the $ 10.1 million outstanding on this debt facility at March 31, 2026, $ 2.1 million was classified as current. The aircraft has been pledged as collateral against the loan. International Borrowing Facilities The Company has other borrowing facilities at certain of its foreign subsidiaries, which consist of overdraft lines, working capital credit lines, and facilities for the issuance of letters of credit and short-term borrowing needs. At March 31, 2026, and December 31, 2025, $ 24.8 million and $ 20.9 million were outstanding, of which $ 5.2 million and $ 4.6 million were classified as current, respectively. Of the $ 24.8 million outstanding at March 31, 2026, $ 16.5 million is attributable to the Poland subsidiary and $ 7.5 million is attributable to the Spain subsidiary. These facilities support commitments made in the ordinary course of business. On July 16, 2025, PLP Poland (Belos) S.A. ("PLP Poland"), a subsidiary of the Company, entered into a non-revolving investment loan with Bank Polska Kasa Opieki Spółka Akcyjna ("Bank Pekao S.A") to finance the construction of a new manufacturing plant for an amount up to PLN 100.3 million ($ 26.9 million). The maturity date of the loan is January 31, 2035 and is payable in annual installments in the amounts of PLN 5.3 million ($ 1.4 million) in 2026, PLN 9.0 million ($ 2.4 million) in 2027, PLN 9.6 million ($ 2.6 million) in 2028 through 2034, and PLN 18.8 million ($ 4.9 million) in 2035. The loan bears interest at the one month Warsaw Interbank Offered Rate ("WIBOR") plus 1.0 % unless the Company does not meet the covenants as set forth in the Facility with PNC, at which point the WIBOR spread becomes 1.5 %. The current manufacturing plant owned by PLP Poland, the plant under construction and all fixed assets within the plants are pledged as collateral against the loan. The loan is guaranteed by the Company. Restricted Cash The Company's Asia-Pacific segment had $ 0.3 million and $ 0.1 million in restricted cash used to secure bank guarantees at March 31, 2026 and December 31, 2025, respectively. The restricted cash is shown on the Company’s Consolidated Balance Sheets in Cash, cash equivalents and restricted cash. NOTE 9 - INCOME TAXES For the three-month period ended March 31, 2026 and 2025, the Company’s effective tax rate was 26 % and 16 %, respectively. The higher effective tax rate for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was mainly due to a valuation allowance of approximately $ 1.3 million recorded on deferred tax assets related to the Company's French subsidiary. The Company provides valuation allowances against deferred tax assets when it is more likely than not that some portion or all of its deferred tax assets will not be realized. During the period ended March 31, 2026, no other valuation allowances were recorded other than the amount recorded related to the Company's French subsidiary. For the three-month periods ending March 31, 2026 and 2025, the Company did not record any new uncertain tax positions. NOTE 10 - COMPUTATION OF EARNINGS PER SHARE Basic earnings per share were computed by dividing net income by the weighted-average number of common shares outstanding for each respective period. Diluted earnings per share were calculated by dividing net income by the weighted-average of all potentially dilutive common shares that were outstanding during the periods presented. 13 The calculation of basic and diluted earnings per share for the three months ended March 31, was as follows: Three Months Ended March 31, 2026 2025 Numerator Net income $ 10,524 $ 11,517 Denominator Determination of shares (in thousands) Weighted-average common shares outstanding 4,906 4,928 Dilutive effect – share-based awards 21 22 Diluted weighted-average common shares outstanding 4,927 4,950 Earnings per common share Basic $ 2.15 $ 2.34 Diluted $ 2.14 $ 2.33 For the three months ended March 31, 2026 and 2025, there were 1,000 and 7,500 share-based awards, respectively, excluded from the calculation of diluted earnings per share as the effect would have been anti-dilutive. NOTE 11 - GOODWILL AND OTHER INTANGIBLES The Company’s finite and indefinite-lived intangible assets consist of the following: March 31, 2026 December 31, 2025 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Finite-lived intangible assets Patents $ 4,806 $ ( 4,806 ) $ 4,806 $ ( 4,806 ) Land use rights 699 ( 143 ) 727 ( 147 ) Trademark 2,033 ( 1,745 ) 2,022 ( 1,736 ) Technology 7,081 ( 4,802 ) 7,240 ( 4,777 ) Customer relationships 19,611 ( 12,897 ) 19,528 ( 12,717 ) $ 34,230 $ ( 24,393 ) $ 34,323 $ ( 24,183 ) Indefinite-lived intangible assets Goodwill $ 30,351 $ 30,684 The Company’s measurement date for its annual impairment test for goodwill is October 1st of each year. The Company performs additional interim impairment assessments as circumstances warrant. There were no indicators of impairment noted for the period ending March 31, 2026. The Company may use both quantitative and qualitative approaches when testing goodwill for impairment. For selected reporting units where the qualitative approach is utilized, a qualitative evaluation of events and circumstances impacting the reporting unit is performed to determine if it is more likely than not that the fair value of the reporting unit exceeds its carrying amount. If that determination is made, no further evaluation is necessary. Otherwise, the Company performs a quantitative impairment test on the reporting unit. For the quantitative approach, the Company uses a combination of the income approach, which uses a discounted cash flow methodology, and the market approach, which uses comparable market multiples in computing fair value by reporting unit. The Company then compares the fair value of the reporting unit with its carrying value to assess if goodwill has been impaired. The fair value estimates are subjective and sensitive to significant assumptions, such as revenue growth rates, operating margins, the weighted average cost of capital, and estimated market multiples, all of which are affected by expectations of future market or economic conditions. The Company believes that the methodologies, significant assumptions, and weightings used are reasonable and result in appropriate fair values of the reporting units. 14 The Company’s only intangible asset with an indefinite life is goodwill. The Company’s goodwill is not deductible for tax purposes. Changes in the carrying amount of goodwill by reporting unit are shown in the following table: PLP-USA The Americas EMEA Asia-Pacific Total Balance at January 1, 2026 $ 3,078 $ 10,626 $ 16,980 $ — $ 30,684 Acquisition Adjustments — ( 79 ) — — ( 79 ) Currency translation — 265 ( 519 ) — ( 254 ) Balance at March 31, 2026 $ 3,078 $ 10,812 $ 16,461 $ — $ 30,351 NOTE 12 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES Fair value is measured based on an exit price, representing the amount that would be received to sell an asset or paid to satisfy a liability in an orderly transaction between market participants. The Company measures and records certain assets and liabilities at fair value. A fair value hierarchy is used for those assets and liabilities measured at fair value that distinguishes between assumptions based on market data (observable inputs), and the Company’s assumptions (unobservable inputs). The hierarchy consists of the following three levels: (Level 1 Inputs) quoted market prices in active markets for identical assets or liabilities; (Level 2 Inputs) observable market-based inputs or unobservable inputs that are corroborated by market data; and (Level 3 Inputs) unobservable inputs that are not corroborated by market data. As of March 31, 2026 and December 31, 2025 the Company had no assets, recorded and measured at fair value, in the Consolidated Balance Sheet. The following table summarizes the Company’s liabilities, recorded and measured at fair value, in the Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025: Description Balance as of March 31, 2026 Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Foreign currency forward contracts $ 50 $ — $ 50 $ — Supplemental profit sharing plan 11,087 — 11,087 — Total liabilities $ 11,137 $ — $ 11,137 $ — Description Balance as of December 31, 2025 Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Foreign currency forward contracts $ 97 $ — $ 97 $ — Supplemental profit sharing plan 10,785 — 10,785 — Total liabilities $ 10,882 $ — $ 10,882 $ — The Company operates internationally and enters into intercompany transactions denominated in foreign currencies. Consequently, the Company is subject to market risk arising from exchange rate movements between the dates foreign currency transactions occur and the dates they are settled. The Company currently uses foreign currency forward contracts to reduce the risk related to some of these transactions. These contracts usually have maturities of 90 days or less and generally require an exchange of foreign currencies for U.S. dollars at maturity at rates stated in the contracts. These contracts are not designated as hedging instruments under U.S. GAAP. Accordingly, the changes in the fair value of the foreign currency forward contracts are recognized in each accounting period in Other income, net on the Consolidated Statements of Income together with the transaction gain or loss from the related balance sheet position. For the three months ended March 31, 2026 and March 31, 2025, the Company recognized net gains of $ 0.2 million and $ 0.1 million, respectively, on foreign currency forward contracts. The Company has a non-qualified supplemental profit sharing plan for its executives (the "Supplemental Profit Sharing Plan"). The liability for the unfunded Supplemental Profit Sharing Plan was $ 11.1 million at March 31, 2026 and $ 10.8 million at December 31, 2025. These amounts are recorded within Other noncurrent liabilities on the Company’s Consolidated Balance Sheets. The 15 Supplemental Profit Sharing Plan allows participants the ability to hypothetically invest their proportionate award into various investment options, which primarily includes mutual funds. The Company credits earnings, gains and losses to the participants’ deferred compensation account balances based on the investments selected by the participants. The Company measures the fair value of the Supplemental Profit Sharing Plan liability using the market values of the participants’ underlying investment accounts. The carrying value of the Company’s current financial instruments, which include cash, cash equivalents and restricted cash, accounts receivable, accounts payable and short-term debt, approximates fair value because of the short-term maturity of these instruments. At March 31, 2026 and December 31, 2025, the fair value of the Company’s long-term debt was estimated using discounted cash flows analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements that are considered to be Level 2 inputs. Based on the analysis performed, the fair value and the carrying value of the Company’s long-term debt are as follows: March 31, 2026 December 31, 2025 Fair Value Carrying Value Fair Value Carrying Value Long-term debt and related current maturities $ 37,549 $ 40,628 $ 35,080 $ 38,252 NOTE 13 - SEGMENT INFORMATION The Company reports its segments in four geographic regions: PLP-USA, The Americas, EMEA (Europe, Middle East & Africa) and Asia-Pacific in accordance with accounting standards codified in FASB ASC 280, "Segment Reporting". Each segment distributes a full range of the Company’s primary products. The PLP-USA segment is comprised of U.S. operations manufacturing the Company’s traditional products primarily supporting domestic energy, telecommunications and special industries products. The other three segments, The Americas, EMEA and Asia-Pacific, support the Company’s energy, telecommunications, data communication and special industries products in each respective geographical region. The segment managers responsible for each region report directly to the Company’s Executive Chairman, who is the chief operating decision maker ("CODM"), and are accountable for the financial results and performance of their entire segment for which they are responsible. The business components within each segment are managed to maximize the results of the entire Company rather than the results of any individual business component of the segment. The amount of each segment’s performance reported to the CODM is for purposes of making decisions about allocating resources to the segment and assessing its performance. The Company evaluates segment performance and allocates resources based on several factors primarily based on gross sales and income before income taxes. The CODM uses both gross sales and income before income taxes for each segment predominantly in the annual budget and forecasting process as well as monitoring actual results. The CODM considers forecast-to-actual and actual to prior period variances for both measures when making decisions about the allocation of operating and capital resources to each segment. The CODM also uses segment gross sales and income before income taxes for the performance of each segment by comparing the results of each segment with one another and in determining the incentive compensation of certain employees. The following tables present a summary of the Company’s reportable segments for the three-month period ended March 31, 2026 and 2025. Financial results for the PLP-USA segment include the elimination of all segments’ intercompany profit in inventory. 16 Three Months Ended March 31, 2026 PLP-USA The Americas EMEA Asia-Pacific Total Gross sales $ 94,820 $ 30,144 $ 34,868 $ 30,603 $ 190,435 Intersegment sales ( 1,507 ) ( 5,082 ) ( 1,578 ) ( 5,990 ) ( 14,157 ) Net sales 93,313 25,062 33,290 24,613 176,278 Less: Cost of products sold 60,782 18,241 24,175 17,860 121,058 Gross profit 32,531 6,821 9,115 6,753 55,220 Costs and expenses 21,895 5,902 7,874 5,833 41,504 Operating Income 10,636 919 1,241 920 13,716 Interest income 207 403 118 49 777 Interest expense ( 23 ) ( 13 ) ( 160 ) ( 36 ) ( 232 ) Other income, net 16 18 32 3 69 Income before income taxes 10,836 1,327 1,231 936 14,330 Income tax expense 1,113 645 1,738 285 3,781 Total noncontrolling interest — — ( 25 ) — ( 25 ) Total net income (loss) attributable to Preformed Line Products Company shareholders $ 9,723 $ 682 $ ( 532 ) $ 651 $ 10,524 Three Months Ended March 31, 2025 PLP-USA The Americas EMEA Asia-Pacific Total Gross sales $ 76,420 $ 24,458 $ 31,577 $ 25,005 $ 157,460 Intersegment sales ( 2,414 ) ( 2,179 ) ( 1,584 ) ( 2,742 ) ( 8,919 ) Net sales 74,006 22,279 29,993 22,263 148,541 Less: Cost of products sold 47,168 15,192 21,116 16,394 99,870 Gross profit 26,838 7,087 8,877 5,869 48,671 Costs and expenses 17,154 5,488 7,350 5,549 35,541 Operating Income 9,684 1,599 1,527 320 13,130 Interest income 79 338 55 38 510 Interest expense ( 85 ) ( 7 ) ( 151 ) ( 133 ) ( 376 ) Other (expense) income, net ( 199 ) 31 22 553 407 Income before income taxes 9,479 1,961 1,453 778 13,671 Income tax expense 1,042 565 229 282 2,118 Total noncontrolling interest — — ( 36 ) — ( 36 ) Total net income attributable to Preformed Line Products Company shareholders $ 8,437 $ 1,396 $ 1,188 $ 496 $ 11,517 17 Three Months Ended March 31, 2026 2025 Expenditure for long-lived assets PLP-USA $ 2,152 $ 702 The Americas 1,173 1,082 EMEA 6,249 8,757 Asia-Pacific 419 435 Total expenditure for long-lived assets $ 9,993 $ 10,976 Depreciation and amortization PLP-USA $ 3,271 $ 3,099 The Americas 1,050 805 EMEA 1,108 905 Asia-Pacific 737 751 Total depreciation and amortization $ 6,166 $ 5,560 March 31, 2026 December 31, 2025 Identifiable assets PLP-USA $ 270,350 $ 276,840 The Americas 122,317 114,111 EMEA 167,283 165,254 Asia-Pacific 101,879 97,416 Total identifiable assets $ 661,829 $ 653,621 Long-lived assets PLP-USA $ 111,832 $ 113,261 The Americas 26,468 25,692 EMEA 52,564 49,017 Asia-Pacific 34,415 34,811 Total long-lived assets $ 225,279 $ 222,781 NOTE 14 - ACQUISITION OF BUSINESSES Acquisition of JAP Telecom On May 1, 2025, the Company acquired all issued and outstanding shares of J.A.P. Industria De Materiais Para Telefonia Ltda., (JAP Telecom) an entity headquartered in Pedreira, Brazil. JAP Telecom is a leading Brazilian designer, manufacturer, and supplier of connectivity solutions for the South American telecommunications infrastructure market with a product portfolio including fiber optic splice closures, connectivity devices, and infrastructure accessories tailored to the specific needs of the local market. JAP Telecom's annual sales for the year ending December 31, 2024 were approximately $ 4.6 million. The acquisition expands the Company's operational capabilities in the region and strengthens the Company's position in the global communications market. The purchase price was approximately $ 5.8 million, net of cash received. The acquisition of JAP Telecom is accounted for using the acquisition method of accounting, which requires the assets acquired and liabilities assumed to be recognized at their respective fair values on the acquisition date. The process of estimating the fair values of certain tangible assets, identifiable intangible assets and assumed liabilities requires the use of judgment in determining the appropriate assumptions and estimates. The fair value of the identifiable net assets as acquired was $ 4.9 million. Goodwill is calculated as the excess of the consideration transferred over the net identifiable assets recognized and represents the anticipated synergies of acquiring JAP Telecom. The goodwill recognized of $ 0.8 million is not deductible for tax purposes. All measurement period adjustments were completed within a year from the acquisition date, and such adjustments did not have a material impact on the Company's results of operations and financial position. For the period ended March 31, 2026, the Company’s consolidated financial statements included JAP Telecom sales of approximately $ 1.9 million and is reported in The Americas segment. 18