What changed in this filing

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Item 1. Financial Statements

2025-07-30 compared with 2025-04-29 · 107 added, 35 removed, 302 unchanged (32% of the section changed)

3 unchanged sentences

(In thousands, except per share data)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Net sales $ 1,784,530 $ 1,769,784 $ 2,856,056 $ 2,890,594

19 unchanged sentences

(In thousands)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Net income $ 194,258 $ 192,439 $ 247,803 $ 271,324

9 unchanged sentences

(In thousands, except share data)

March 31, March 31, December 31,

June 30, June 30, December 31,

2025 2024 2024

30 unchanged sentences

37,314,231 , 38,289,105 and 37,691,942 shares issued and

outstanding at March 31, 2025, March 31, 2024 and

outstanding at June 30, 2025, June 30, 2024 and

December 31, 2024, respectively

1 unchanged sentence

Retained earnings 642,230 798,204 648,476

Accumulated other comprehensive (loss) income ( 12,648 ) 5,140 ( 13,664 )

Accumulated other comprehensive loss ( 1,494 ) ( 920 ) ( 13,664 )

Total stockholders’ equity 1,299,118 1,423,669 1,273,465

4 unchanged sentences

(In thousands)

Three Months Ended

Six Months Ended

Operating activities

Net income $ 247,803 $ 271,324

Adjustments to reconcile net income to net cash provided by operating activities:

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Depreciation 19,804 17,591

9 unchanged sentences

Accrued expenses and other liabilities ( 55,488 ) ( 8,720 )

Net cash provided by operating activities 27,224 145,442

Net cash (used in) provided by operating activities ( 1,544 ) 172,102

Investing activities

15 unchanged sentences

Repurchases of common stock ( 160,648 ) ( 84,496 )

Net cash used in financing activities ( 20,611 ) ( 124,162 )

Net cash provided by (used in) financing activities 33,145 ( 100,034 )

Effect of exchange rate changes on cash and cash equivalents 2,669 ( 3,369 )

25 unchanged sentences

Balance at March 31, 2025 37,660 $ 38 $ 651,053 $ 600,248 $ ( 12,648 ) $ 1,238,691

— — — 194,258 — 194,258

Foreign currency translation

— — — — 13,358 13,358

Interest rate swaps, net of the change in taxes of $ 735

— — — — ( 2,204 ) ( 2,204 )

Repurchases of common stock, net of retirements

( 351 ) ( 1 ) — ( 105,322 ) — ( 105,323 )

Share-based compensation

— — 6,895 — — 6,895

Issuance of stock under share-based compensation plans

5 — 397 — — 397

Declaration of cash dividends

— — — ( 46,954 ) — ( 46,954 )

Balance at June 30, 2025 37,314 $ 37 $ 658,345 $ 642,230 $ ( 1,494 ) $ 1,299,118

Common Stock Additional

1 unchanged sentence

Comprehensive

Shares Amount Capital Earnings Income Total

Shares Amount Capital Earnings Income (Loss) Total

Balance at December 31, 2023 38,355 $ 38 $ 606,177 $ 699,990 $ 6,582 $ 1,312,787

13 unchanged sentences

Balance at March 31, 2024 38,462 $ 38 $ 620,278 $ 720,228 $ 5,140 $ 1,345,684

— — — 192,439 — 192,439

Foreign currency translation

— — — — ( 4,684 ) ( 4,684 )

Interest rate swaps, net of the change in taxes of $ 459

— — — — ( 1,376 ) ( 1,376 )

Repurchases of common stock, net of retirements

( 181 ) — — ( 68,519 ) — ( 68,519 )

Share-based compensation

— — 5,016 — — 5,016

Issuance of stock under share-based compensation plans

8 — 1,053 — — 1,053

Declaration of cash dividends

— — — ( 45,944 ) — ( 45,944 )

Balance at June 30, 2024 38,289 $ 38 $ 626,347 $ 798,204 $ ( 920 ) $ 1,423,669

The accompanying Notes are an integral part of the Consolidated Financial Statements.

9 unchanged sentences

You should read the interim Consolidated Financial Statements in conjunction with the Consolidated Financial Statements and accompanying notes in our 2024 Annual Report on Form 10-K.

The results for our three-month period ended March 31, 2025, are not necessarily indicative of the expected results for our fiscal year ending December 31, 2025.

The results for our three and six-month periods ended June 30, 2025 are not necessarily indicative of the expected results for our fiscal year ending December 31, 2025.

We reduce federal and state income taxes payable by the tax benefits associated with the exercise of nonqualified stock options and the lapse of restrictions on restricted stock awards.

1 unchanged sentence

We record all excess tax benefits as a component of income tax benefit or expense on the Consolidated Statements of Income in the period in which stock options are exercised or restrictions on restricted stock awards lapse.

We recorded excess tax benefits of $ 3.8 million in the first quarter of 2025 compared to $ 7.4 million in the first quarter of 2024.

There were no tax benefits realized from ASU 2016-09 in the second quarter of 2025 compared to an excess tax benefit of $ 0.4 million in the second quarter of 2024 and $ 3.9 million in the six months ended June 30, 2025, compared to $ 7.8 million in the six months ended June 30, 2024.

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law in the U.S., including a broad range of tax reform provisions.

We currently do not expect the changes resulting from the OBBBA to have a material impact on our results of operations.

Retained Earnings

We account for the retirement of repurchased shares as a reduction of Retained earnings.

As of March 31, 2025, the Retained earnings on our Consolidated Balance Sheets reflects (i) cumulative net income, (ii) the cumulative impact of adjustments for changes in accounting pronouncements, (iii) share retirements since the inception of our share repurchase programs of $ 2.8 billion and (iv) cumulative dividends of $ 1.3 billion .

Accumulated Other Comprehensive (Loss) Income

The table below presents the components of our Accumulated other comprehensive (loss) income balance (in thousands):

March 31, December 31,

As of June 30, 2025, the Retained earnings on our Consolidated Balance Sheets reflects (i) cumulative net income, (ii) the cumulative impact of adjustments for changes in accounting pronouncements, (iii) share retirements since the inception of our share repurchase programs of $ 2.9 billion and (iv) cumulative dividends of $ 1.4 billion.

Accumulated Other Comprehensive Loss

The table below presents the components of our Accumulated other comprehensive loss balance (in thousands):

June 30, December 31,

2025 2024 2024

2 unchanged sentences

10,309 20,131 15,424

Accumulated other comprehensive (loss) income $ ( 12,648 ) $ 5,140 $ ( 13,664 )

Accumulated other comprehensive loss $ ( 1,494 ) $ ( 920 ) $ ( 13,664 )

Recent Accounting Pronouncements Pending Adoption

1 unchanged sentence

Standard Description Effective Date Effect on Financial Statements and Other Significant Matters

ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Accounting Standards Update (ASU) 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses and related amendments

In November 2024, the FASB issued ASU 2024-03 and in January 2025, the FASB issued ASU 2025-01 , Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

In November 2024, the Financial Accounting Standards Board (FASB) issued ASU 2024-03 and in January 2025, the FASB issued ASU 2025-01 , Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , which adds new disclosure requirements, including more detailed information about certain income statement expense line items and a separate disclosure for selling expenses.

6 unchanged sentences

Improvements to Income Tax Disclosures , which will require enhancements and further transparency for decision usefulness to various income tax disclosures, most notably the tax rate reconciliation and income taxes paid.

Annual periods beginning after December 15, 2024 on a prospective basis and retrospective application is permitted.

Early adoption is also permitted.

For annual periods beginning after December 15, 2024.

This ASU may be adopted on a prospective basis.

Retrospective application and early adoption are also permitted.

We expect that the adoption of this standard will expand our disclosures but do not expect the adoption of this standard to have a material impact on our consolidated financial statements.

3 unchanged sentences

Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative , which will impact various disclosure areas, including the statement of cash flows, accounting changes and error corrections, earnings per share, debt, equity, derivatives, and transfers of financial assets.

The amendments in ASU 2023-06 will be effective on the date the related disclosures are removed from Regulation S-X or Regulation S-K by the SEC and will no longer be effective if the SEC has not removed the applicable disclosure requirement by June 30, 2027.

On the date the related disclosures are removed from Regulation S-X or Regulation S-K by the SEC and will no longer be effective if the SEC has not removed the applicable disclosure requirement by June 30, 2027.

Early adoption is prohibited.

We do not expect the adoption of this standard to have a material impact on our consolidated financial statements since we are already subject to the requirements under Regulation S-X and Regulation S-K.

We do not expect that the adoption of this standard will have a material impact on our consolidated financial statements or related disclosures.

Note 2 – Earnings Per Share

2 unchanged sentences

Our participating securities include share-based payment awards that contain a non-forfeitable right to receive dividends and are considered to participate in undistributed earnings with common shareholders.

Participating securities excluded from weighted average common shares outstanding were 184,000 for the three months ended March 31, 2025, and 205,000 for the three months ended March 31, 2024.

Participating securities excluded from weighted average common shares outstanding were 186,000 for the three months ended June 30, 2025, and 208,000 for the three months ended June 30, 2024, and 185,000 for the six months ended June 30, 2025 and 206,000 for the six months ended June 30, 2024.

The table below presents the computation of earnings per share, including the reconciliation of basic and diluted weighted average shares outstanding (in thousands, except per share data):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Net income $ 194,258 $ 192,439 $ 247,803 $ 271,324

10 unchanged sentences

Anti-dilutive stock options excluded from diluted earnings per share computations (1)

190 56 190 57

(1) Since these options have exercise prices that are higher than the average market prices of our common stock, including them in the calculation would have an anti-dilutive effect on earnings per share.

15 unchanged sentences

The table below presents our assets and liabilities measured and recorded at fair value on a recurring basis (in thousands):

Fair Value at March 31,

Fair Value at June 30,

Input Level Classification 2025 2024

8 unchanged sentences

We recognize any differences between the variable interest rate in effect and the fixed interest rates per our swap contracts as an adjustment to interest expense over the life of the swaps.

To the extent our derivatives are effective in offsetting the variability of the hedged cash flows, we record the changes in the estimated fair value of our interest rate swap contracts to Accumulated other comprehensive (loss) income on the Consolidated Balance Sheets.

Our interest rate swaps in effect during the quarter were previously forward-starting and converted the variable interest rate to a fixed interest rate on a portion of our variable rate borrowings.

Our interest rate swaps in effect during the first six months of 2025 were previously forward-starting and converted the variable interest rate to a fixed interest rate on a portion of our variable rate borrowings.

Interest expense related to the notional amounts under our swap contracts was based on the fixed rates plus the applicable margin on our variable rate borrowings.

Changes in the estimated fair value of these interest rate swap contracts were recorded to Accumulated other comprehensive (loss) income on the Consolidated Balance Sheets.

We recorded changes in the estimated fair value of these interest rate swap contracts to Accumulated other comprehensive loss on the Consolidated Balance Sheets.

One of our interest rate swap contracts terminated on February 28, 2025.

9 unchanged sentences

Interest rate swap 3 March 9, 2020 February 28, 2025 February 26, 2027 $ 150.0 0.7630 %

For the interest rate swap contracts in effect at March 31, 2025, a portion of the change in the estimated fair value between periods relates to future interest expense.

Recognition of the change in fair value between periods attributable to accrued interest is reclassified from Accumulated other comprehensive (loss) income on the Consolidated Balance Sheets to Interest and other non-operating expenses, net on the Consolidated Statements of Income.

These amounts were not material in the three-month periods ended March 31, 2025 or March 31, 2024.

For the interest rate swap contracts in effect at June 30, 2025, a portion of the change in the estimated fair value between periods relates to future interest expense.

Recognition of the change in fair value between periods attributable to accrued interest is reclassified from Accumulated other comprehensive loss on the Consolidated Balance Sheets to Interest and other non-operating expenses, net on the Consolidated Statements of Income.

These amounts were not material in the three and six-month periods ended June 30, 2025 or June 30, 2024.

Failure of any of our swap counterparties would result in the loss of any potential benefit to us under our swap agreements.

25 unchanged sentences

Total debt $ 1,229,919 $ 1,116,553

Our accounts receivable securitization facility (the Receivables Facility) provides for the sale of certain of our receivables to a wholly-owned subsidiary (the Securitization Subsidiary).

Credit Facility

Our Credit Facility provides for $ 1.3 billion in borrowing capacity consisting of an $ 800.0 million unsecured revolving credit facility and a $ 500.0 million term loan facility.

Under our Credit Facility at June 30, 2025, there was $ 354.8 million of revolving borrowings outstanding, a $ 450.0 million term loan (net of $ 50.0 million of amortization payments), $ 15.1 million of standby letters of credit outstanding and $ 430.1 million available for borrowing.

Subsequent to June 30, 2025, we entered into the Fourth Amended and Restated Credit Agreement (the Amended Agreement), on July 10, 2025, by and among us, as U.S.

Borrower, SCP Distributors Canada Inc., as Canadian Borrower, SCP International, Inc., as Euro Borrower, Wells Fargo Bank, National Association, as Administrative Agent, and certain other lenders party thereto.

The Amended Agreement amends and restates the terms of our predecessor credit agreement principally by refinancing the existing $ 500.0 million term loan, extending the term loan maturity date from September 26, 2026 to September 30, 2029 and removing the term secured overnight financing rate (Term SOFR) adjustment of 0.10 %.

Under the Amended Agreement, the term loan requires quarterly amortization payments commencing on September 30, 2027, with all remaining principal due on September 30, 2029.

Revolving and term loan borrowings under the Amended Agreement continue to bear interest at a variable rate based on one-month Term SOFR, plus an applicable margin.

Otherwise, the Amended Agreement retains the core features of the predecessor credit agreement, including:

• $ 1.3 billion in borrowing capacity, consisting of:

◦ an $ 800.0 million unsecured revolving credit facility;

◦ a $ 500.0 million term loan facility;

• an accordion feature permitting us to request one or more incremental term loans or revolving credit facility commitment increases up to $ 250.0 million;

• an option permitting us to extend the maturity date of the revolving credit facility up to two years, subject to various conditions and restrictions;

• sublimits for the issuance of swingline loans and standby letters of credit.

Substantially all of the other terms of the term loan and revolving credit facility in the Amended Agreement remain similar to the predecessor credit agreement.

The Amended Agreement continues to require us to maintain a maximum average total leverage ratio and a minimum fixed charge coverage ratio consistent with the terms specified in the predecessor credit agreement.

All obligations under the Amended Agreement continue to be guaranteed on an unsecured basis by substantially all of our existing and future domestic subsidiaries.

The Amended Agreement also continues to contain various customary affirmative and negative covenants and events of default.

Failure to comply with any of the financial covenants or the occurrence of any other events of default would permit the lenders to, among other things, require immediate payment of all amounts outstanding under the Amended Agreement.

Following execution of the Amended Agreement on July 10, 2025, there was $ 380.0 million of revolving borrowings outstanding, a $ 500.0 million term loan, $ 14.4 million of standby letters of credit outstanding and $ 405.6 million available for borrowing under the Amended Agreement’s revolving credit facility.

Term Facility

Under our Term Facility, there was $ 90.0 million outstanding at June 30, 2025.

On July 10, 2025, we also entered into the Fourth Amendment to Credit Agreement, by and among us, as Borrower, the guarantors party thereto, and Bank of America, N.A., as lender (the Fourth Amendment), which amends that certain Credit Agreement by and among us, as borrower, the guarantors party thereto and Bank of America, N.A., as lender, dated as of December 30, 2019, as amended by that certain First Amendment to Credit Agreement dated October 12, 2021, that certain Second Amendment to Credit Agreement, dated June 30, 2023 and that certain Third Amendment to Credit Agreement, dated September 30, 2024 (as amended, the Term Agreement).

The Fourth Amendment principally extends the maturity of the term loan under the Term Agreement from December 30, 2026 to September 30, 2029 to be concurrent with the maturity of the loans under the Amended Agreement and removes the Term SOFR adjustment of 0.10 %.

Term loan borrowings under the Term Agreement bear interest at a variable rate based on one-month Term SOFR, plus an applicable margin.

Under the Term Agreement, the term loan is repaid in quarterly installments of 1.250 % of the term loan on the last business day of each quarter beginning in the third quarter of 2027 with the final principal repayment due September 30, 2029.

Following the Fourth Amendment on July 10, 2025, there was $ 90.0 million outstanding under the Term Facility.

Receivables Securitization Facility

Under our Receivables Securitization Facility, there was $ 320.1 million outstanding at June 30, 2025.

Our accounts receivable securitization facility (the Receivables Facility) enables us to borrow up to $ 210.0 million to $ 375.0 million depending on the time of year, by providing for the sale of certain of our receivables to a wholly-owned subsidiary (the Securitization Subsidiary).

The Securitization Subsidiary transfers variable undivided percentage interests in the receivables and related rights to certain third-party financial institutions in exchange for cash proceeds, limited to the applicable funding capacities.

11 unchanged sentences

T he table below presents segment revenue, operating expenses and operating income and reconciles segment operating income to consolidated income before taxes and equity in earnings (in thousands):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Net sales $ 1,784,530 $ 1,769,784 $ 2,856,056 $ 2,890,594

9 unchanged sentences

The tables below present supplemental information for our segment (in thousands):

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Depreciation $ 9,964 $ 8,931 $ 19,804 $ 17,591

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements