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Item 7. Management’s Discussion and Analysis

2026-06-04 compared with 2025-06-10 · 123 added, 148 removed, 358 unchanged (43% of the section changed)

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The presentation of our non-GAAP financial measures may change from time to time, including from changed business conditions, new accounting rules, or otherwise.

Further, our use of "net debt" may vary from the use of

similarly titled measures by other companies due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation.

Further, our use of "net debt" may vary from the use of similarly titled measures by other companies due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation.

Executive Summary

Sales and other operating revenues increased by 22.1% to $2,481.3 million for the year ended March 31, 2025 from $2,032.5 million for the year ended March 31, 2024.

This growth was driven by a 18.0% increase in average price per kilo, which was influenced by short crops in certain markets, affecting overall industry supply, and by inflation on tobacco prices.

Additionally, kilo volume increased by 3.4% due to growth in Africa and Asia and accelerated shipments from Africa and North America.

These increases were partially offset by lower volume from South America compared to the prior-year period due to the impact of El Niño on crop sizes.

Gross profit for fiscal 2025 increased to $343.0 million compared to $312.3 million in the prior fiscal year.

This growth was primarily due to a 3.4% increase in kilo volume and a 7.7% increase in average gross profit per kilo driven by favorable customer and product mix.

Undersupply conditions in the market continue, which is reflected in our low uncommitted inventory of $7.6 million as of March 31, 2025 .

Our total processed tobacco inventory level at fiscal year end was $490.4 million, down from $585.3 million a year ago.

Despite the pressures to fund purchasing more expensive green tobacco in the year ended March 31, 2025 , we continued to reduce our senior debt.

During the 2025 fiscal year, we repaid or repurchased an aggregate of $64.9 million in aggregate principal amount of senior notes and term loans, which followed our repurchase in March 2024 of an aggregate of $77.9 million of senior notes.

Fiscal 2026 results were influenced by larger crops in several of our key operating origins, notably those in Africa and South America, a consistent factor throughout the fiscal year.

Larger crops generally reduce the per-unit cost of procuring green tobacco and provide us with opportunities to source higher volumes from our global supplier base.

Lower purchasing costs, together with increased processing volumes, contributed to current year cost efficiencies, including the dilution of conversion costs on a per-kilo basis.

During fiscal 2026, the global tobacco market transitioned from an undersupply position at the beginning of the fiscal year to an oversupply by its conclusion on March 31, 2026.

Against this evolving market backdrop, which also included the introduction of new tariff regulations and the continuation of geopolitical conflicts, our consolidated results continued to include gross profit expansion and increased operating income when compared to the prior year.

Our financial performance demonstrates our team's ability to adapt to changing, and sometimes challenging, market conditions, by leveraging our globally diversified footprint, supporting our suppliers, and working with our customers to ensure their requirements are met.

The Company enters fiscal year 2027 with a total of $786.7 million of tobacco inventories on hand, higher than the $732.2 million at the same time a year ago.

The higher tobacco inventories are expected to result in more carry-over sales versus fiscal 2026.

Crop purchases have commenced in our key sourcing origins within the Southern Hemisphere, and for the second consecutive year we are observing the production of large crops across most of these origins.

We are taking a measured approach in our buying strategy to ensure we are procuring the volumes necessary to meet our customers' needs.

Pyxus is a global agricultural company with businesses having more than 150 years of experience delivering value-added products and services to businesses and customers.

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See " Note 26.

Basis of Presentation and Summary of Significant Accounting Policies " to the "Notes to the Consolidated Financial Statements" for additional information.

Segment Information " to the "Notes to the Consolidated Financial Statements" for additional information.

Results of Operations

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Gain on debt retirement — 8.2 (8.2) (100.0)

Loss on pension settlement — 12.0 (12.0) **

Gain on pension settlement 0.3 — 0.3 100.0

Interest expense, net 134.4 128.0 6.4 5.0

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Net income attributable to Pyxus International, Inc.* $ 14.6 $ 15.2 (0.6) (3.9)

Product revenue $ 2,335.1 $ 1,912.4 422.7 22.1

Product revenues $ 2,235.8 $ 2,335.1 (99.3) (4.3)

Tobacco costs 1,808.0 1,905.5 (97.5) (5.1)

Transportation, storage, and other period costs 115.8 108.5 7.3 6.7

Total cost of goods sold 2,014.0 1,624.4 389.6 24.0

Total product cost of goods sold 1,923.8 2,014.0 (90.2) (4.5)

Product gross profit 312.0 321.1 (9.1) (2.8)

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Cost of goods and services sold 6.2 12.5 (6.3) (50.4)

Gross loss (2.2) (3.3) 1.1 33.3

Gross loss as a percent of sales (21.4) % (113.8) %

Gross profit (loss) 1.7 (2.2) 3.9 177.3

Gross profit (loss) as a percent of sales 21.5 % (21.4) %

*Amounts may not equal column totals due to rounding.

**Not meaningful for comparison purposes.

Sales and other operating revenues increased $448.8 million, or 22.1%, to $2,481.3 million for the year ended March 31, 2025 from $2,032.5 million for the year ended March 31, 2024.

This increase was due to a 18.0% increase in average price per kilo driven by higher tobacco costs and a 3.4% increase in kilo volume from growth in Africa and Asia and accelerated shipments from Africa and North America, partially offset by lower volume from South America compared to the prior-year period from the El Niño weather effects reducing crop sizes.

Cost of goods and services sold increased $418.1 million, or 24.3%, to $2,138.3 million for the year ended March 31, 2025 from $1,720.2 million for the year ended March 31, 2024, driven by a 19.9% increase in average cost per kilo primarily due to undersupply conditions and inflation.

Gross profit increased $30.7 million, or 9.8%, to $343.0 million for the year ended March 31, 2025 from $312.3 million for the year ended March 31, 2024, mainly due to a 3.4% increased kilo volume and a 7.7% increase in average gross profit per kilo to $0.84 as compared to $0.78 in the prior-year period driven by favorable customer and product mix.

Selling, general, and administrative expenses as a percent of sales decreased to 6.9% for the year ended March 31, 2025 from 7.9% for the year ended March 31, 2024.

Selling, general, and administrative expenses increased $10.1 million, or 6.3%, to $171.0 million for the year ended March 31, 2025 from $160.9 million for the year ended March 31, 2024, primarily due to higher personnel costs, including the recognition of $4.1 million for non-cash equity-based compensation pursuant to the Amended and Restated 2020 Incentive Plan and a higher accrual for variable bonus compensation.

See " Note 24 .

Equity-Based Compensation " to the "Notes to Consolidated Financial Statements" for additional information.

Other expense, net increased $7.0 million, or 74.5%, to $16.4 million for the year ended March 31, 2025 from $9.4 million for the year ended March 31, 2024 mostly due to increased utilization of the Company's securitization facilities.

Loss on pension settlement of $12.0 million for the year ended March 31, 2024, was due to the termination of an over-funded defined benefit pension plan in the U.K.

See " Note 20.

Pension and Other Postretirement Benefits " to the "Notes to Consolidated Financial Statements" for additional information.

Sales and other operating revenues decreased $68.3 million, or 2.8%, to $2,413.0 million for the year ended March 31, 2026 from $2,481.3 million for the year ended March 31, 2025.

This decrease was a result of a 3.8% decrease in average price per kilo, primarily in Africa, with pricing reflective of the lower costs to purchase the crop in the current fiscal year, and lower leaf product revenues driven by a decline in value-added tobacco products sales volumes.

The decrease in leaf product revenues was partially offset by volume growth in processing and other revenues mainly from Africa and North America.

Cost of goods and services sold decreased $73.0 million, or 3.4%, to $2,065.3 million for the year ended March 31, 2026 from $2,138.3 million for the year ended March 31, 2025, corresponding to the reduction in sales and other operating revenues, principally driven by lower costs incurred to purchase and process the current crop.

Gross profit increased $4.7 million, or 1.4%, to $347.7 million for the year ended March 31, 2026 from $343.0 million for the year ended March 31, 2025, mainly attributable to increased leaf product sales volumes in South America and higher volumes from processing and other revenues in Africa and North America.

The larger processing and other revenues contributed to the improvement in gross profit as a percent of sales to 14.4%, compared to 13.8% in the prior fiscal year.

Selling, general, and administrative expenses decreased $8.1 million, or 4.7%, to $162.9 million for the year ended March 31, 2026 from $171.0 million for the year ended March 31, 2025, primarily driven by a lower accrual for variable incentive compensation and less equity-based compensation expense due to the non-recurrence of modifications to restricted stock awards effected in the prior fiscal year, partially offset by increased personnel costs.

Gain on debt retirement of $8.2 million f or the year ended March 31, 2025 was due to the repurchase of $10.3 million of aggregate principal amount of the Pyxus Term Loans for $9.1 million, a 12.0% discount to par, and the repurchase of $34.2 million aggregate principal amount of the 2027 Notes for $26.3 million, a 23.0% discount to par.

Gain on debt retirement of $15.9 million for the year ended March 31, 2024 was due to the repurchase of $77.9 million aggregate principal amount of the 2027 Notes for $60.0 million, a 23.0% discount to par.

There were no repurchases of senior secured notes or term loans during the year ended March 31, 2026.

See " Note 25.

Debt Arrangements " to the "Notes to Consolidated Financial Statements" for additional information.

Income from unconsolidated affiliates, net decreased $6.9 million, or 46.0%, to $8.1 million for the year ended March 31, 2025 from $15.0 million for the year ended March 31, 2024, due principally to lower volume and average gross margin per kilo from South America compared to the prior-year period from the El Niño weather effects reducing crop sizes.

Related Party Transactions " to the "Notes to Consolidated Financial Statements" for additional information.

Interest expense, net increased $6.4 million, or 5.0%, to $134.4 million for the year ended March 31, 2026 from $128.0 million for the year ended March 31, 2025 due to higher average balances outstanding on our foreign seasonal lines of credit primarily in Africa and South America, partially offset by a decrease in weighted average interest rates on our foreign seasonal lines of credit and senior secured term loans.

Income tax expense increased $5.2 million, or 20.7%, to $30.3 million for the year ended March 31, 2026 from $25.1 million for the year ended March 31, 2025 mainly due to the partial release of the valuation allowance applied against certain U.S.

deferred tax assets in the prior fiscal year.

Income from unconsolidated affiliates, net increased $9.3 million, or 114.8%, to $17.4 million for the year ended March 31, 2026 from $8.1 million for the year ended March 31, 2025.

This increase was primarily due to higher profitability generated at our equity method investment in South America as a result of lower purchasing costs for the current crop that was sold during the current fiscal year.

Also contributing to the increase was higher net income from one of our Asian equity method investments due to larger crop volumes sold, as well as a gain on the sale of certain fixed assets and from the receipt of insurance recoveries following severe flooding that impacted operations in the prior year.

Comparison of the Fiscal Year Ended March 31, 2025 to the Fiscal Year Ended March 31, 2024

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Liquidity and Capital Resources

Our primary sources of liquidity are cash generated from operations, short-term borrowings under our seasonal lines of credit, availability under ABL Credit Facility (defined below), and cash collections from our securitized receivables.

Our liquidity requirements are affected by various factors from our core tobacco leaf business, including crop seasonality, foreign currency and interest rates, green tobacco prices, customer mix, crop size, and quality.

Our primary sources of liquidity are cash generated from operations, short-term borrowings under our foreign seasonal lines of credit, availability under our ABL Credit Facility, and cash collections from our securitized receivables.

Our liquidity requirements are affected by various factors from our tobacco leaf business, including crop seasonality, foreign currency and interest rates, green tobacco prices, customer mix, crop size, and quality.

Our leaf tobacco business is seasonal, and purchasing, processing, and selling activities have several associated peaks where cash on-hand and outstanding indebtedness may vary significantly compared to year end.

The first three quarters of our fiscal year generally represent the peak of our working capital requirements.

The first two quarters of our fiscal year generally represent the peak of our working capital requirements.

We believe our sources of liquidity will be sufficient to fund our anticipated operating needs for the next twelve months.

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ABL Credit Facility

Our wholly owned subsidiary, Pyxus Holdings, Inc.

The Company ’ s wholly owned subsidiary, Pyxus Holdings, Inc.

("Pyxus Holdings"), certain subsidiaries of Pyxus Holdings (together with Pyxus Holdings, the "Borrowers"), and the Company and its wholly owned subsidiary, Pyxus Parent, Inc.

("Pyxus Parent"), as guarantors, entered into an ABL Credit Agreement (as amended, the "ABL Credit Agreement"), dated as of February 8, 2022, by and among Pyxus Holdings, as Borrower Agent, the Borrowers and parent guarantors party thereto, the lenders party thereto, and PNC Bank, National Association, as Administrative Agent and Collateral Agent, which was subsequently amended on May 23, 2023 and October 24, 2023.

Refer to "Note 27.

Subsequent Events" to the "Notes to Consolidated Financial Statements" for additional information regarding the Fourth Amendment to the ABL Credit Facility.

The ABL Credit Agreement establishes an asset-based revolving credit facility (the "ABL Credit Facility"), the proceeds of which may be used to provide for the ongoing working capital and general corporate purposes of the Borrowers, the Company, Pyxus Parent, and their subsidiaries.

The ABL Credit Facility may be used for revolving credit loans and letters of credit from time to time up to a maximum principal amount of $120.0 million, subject to the limitations described below in this paragraph.

("Pyxus Parent"), as parent guarantors, entered into an ABL Credit Agreement (as amended, the "ABL Credit Agreement"), dated as of February 8, 2022, by and among Pyxus Holdings, as Borrower Agent, the Borrowers and parent guarantors party thereto, the lenders party thereto, and PNC Bank, National Association, as Administrative Agent and Collateral Agent (the "ABL Agent"), which was subsequently amended on January 5, 2023, May 23, 2023, October 24, 2023, and May 12, 2025.

The ABL Credit Agreement establishes the ABL Credit Facility, an asset-based revolving credit facility the proceeds of which may be used to provide for the ongoing working capital and general corporate purposes of the Borrowers, the Company, Pyxus Parent, and their subsidiaries, and for other permitted purposes described in the ABL Credit Agreement.

The ABL Credit Facility may be used for revolving credit loans and letters of credit from time to time up to a maximum principal amount of $150.0 million, subject to the borrowing base limitations described below in this paragraph.

The ABL Credit Facility includes a $20.0 million uncommitted accordion feature that permits Pyxus Holdings, under certain conditions, to solicit the lenders under the ABL Credit Facility to provide additional revolving loan commitments to increase the aggregate amount of the revolving loan commitments under the ABL Credit Facility not to exceed a maximum principal amount of $170.0 million.

The amount available under the ABL Credit Facility is limited by a borrowing base consisting of certain eligible accounts receivable and inventory, reduced by specified reserves, as follows:

• 85% of eligible accounts receivable, plus

The amount available under the ABL Credit Facility is limited by a borrowing base consisting of certain eligible accounts receivable and the value of inventory, as reduced by specified reserves, as follows:

• 85% of the book value of eligible accounts receivable, plus

• the lesser of (i) 85% of the book value of Eligible Extended Terms Receivables (as defined in the ABL Credit Agreement) and (ii) $5.0 million plus

• 90% of eligible credit insured accounts receivable, plus

• the lesser of (i) 70% of eligible inventory valued at the lower of cost (based on a first-in first-out basis) and market value thereof (net of intercompany profits) or (ii) 85% of the net-orderly-liquidation value percentage of eligible inventory, minus

• applicable reserves.

• 90% of eligible credit insured accounts receivable (to the extent the ABL Agent is named as a beneficiary or loss payee with respect to the applicable policy), plus

• the least of (i) 70% of the eligible foreign in-transit inventory valued at the lower of cost (based on a first-in first-out basis) and market value thereof (net of intercompany profits), (ii) 85% of the net-orderly-liquidation value percentage of eligible foreign in-transit inventory, and (iii) $10.0 million , minus

• applicable reserves established by the ABL Agent from time to time.

At March 31, 2026, no borrowings under the ABL Credit Facility were outstanding and $150.0 million was available for borrowing under the ABL Credit Facility.

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The ABL Credit Facility permits both base rate borrowings and borrowings based upon the Secured Overnight Financing Rate ("SOFR").

Borrowings under the ABL Credit Facility bear interest at an annual rate equal to one, three, or six-month reserve-adjusted SOFR Rate plus 300 basis points or 200 basis points above base rate, as applicable, with a fee on unutilized commitments at an annual rate of 25.0 basis points if the outstanding borrowings equal or exceed $60.0 million and 37.5 basis points if the outstanding borrowings are less than $60.0 million.

As of March 31, 2025, there are no amounts outstanding under the ABL Credit Facility.

The ABL Credit Facility may be prepaid from time to time, in whole or in part, without prepayment or premium, subject to a termination fee upon the permanent reduction of commitments under the ABL Credit Facility of 300 basis points for terminations in the first year after entry into the ABL Credit Agreement, 200 basis points for terminations in the second year and 100 basis points for termination in the third year.

Borrowings under the ABL Credit Facility bear interest at an annual rate equal to one, three, or six-month reserve-adjusted SOFR Rate plus 275 basis points or 175 basis points above base rate, as applicable, with a fee on unutilized commitments at an annual rate of 25.0 basis points.

The ABL Credit Facility may be prepaid from time to time, in whole or in part, without prepayment or premium, subject to a termination fee upon the permanent reduction of some or all of the commitments under the ABL Credit Facility in the amount of (i) 2% of the amount of commitments permanently reduced on or prior to May 12, 2026 and (ii) 1% of the amount of commitments permanently reduced on or prior to May 12, 2027 but after May 12, 2026.

No such termination fee is payable for reductions after May 12, 2027.

In addition, customary mandatory prepayments of the loans under the ABL Credit Facility are required upon the occurrence of certain events including, without limitation, outstanding borrowing exposures exceeding the borrowing base, certain dispositions of assets outside of the ordinary course of business in respect of certain collateral securing the ABL Credit Facility and certain casualty and condemnation events.

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Cash Dominion.

Under the terms of the ABL Credit Facility, if (i) an event of default has occurred and is continuing, (ii) excess borrowing availability under the ABL Credit Facility (based on the lesser of the commitments thereunder and the borrowing base) (the "Excess Availability") falls below the greater of $10.0 million or 10% of the lesser of total commitments under the ABL Credit Facility at such time and the borrowing base at such time, or (iii) Domestic Availability (as defined in the ABL Credit Agreement) being less than the greater of $20.0 million or 20% of the lesser of total commitments under the ABL Credit Facility at such time and the borrowing base at such time, the ABL Loan Parties will become subject to cash dominion, which will require daily prepayment of loans under the ABL Credit Facility with the cash deposited in certain deposit accounts of the ABL Loan Parties, including concentration accounts, and will restrict the ABL Loan Parties’ ability to transfer cash from their concentration accounts to their disbursement accounts.

Such cash dominion period (a "Dominion Period") shall end when (i) if arising as a result of a continuing event of default, such event of default ceases to exist, (ii) if arising as a result of non-compliance with the Excess Availability threshold, no event of default is continuing and, for a period of 30 consecutive days, Excess Availability is equal to or greater than the greater of $10.0 million or 10% of the lesser of total commitments under the ABL Credit Facility and the borrowing base, or (iii) if arising as a result of Domestic Availability being less than the threshold, no event of default is continuing and, for a period of 30 consecutive days, Domestic Availability is greater than $20.0 million or 20% of the lesser of total commitments under the ABL Credit Facility and the borrowing base.

The ABL Credit Agreement governing the ABL Credit Facility contains (i) a springing covenant requiring that the Company’s fixed charge coverage ratio be no less than 1.10 to 1.00 during any Dominion Period and (ii) a covenant requiring Domestic Availability greater than $20.0 million at all times until audited financial statements for fiscal year ending March 31, 2023 are delivered under the ABL Credit Agreement.

Under the terms of the ABL Credit Facility, if (i) an event of default has occurred and is continuing, (ii) excess borrowing availability under the ABL Credit Facility (based on the lesser of the commitments thereunder and the borrowing base) (the "Excess Availability") falls below the greater of $12.5 million and 10% of the lesser of total revolving loan commitments under the ABL Credit Facility at such time and the borrowing base at such time, or (iii) Domestic Availability (as defined in the ABL Credit Agreement) being less than the greater of $25.0 million and 20% of the lesser of total revolving loan commitments under the ABL Credit Facility at such time and the borrowing base at such time, the ABL Loan Parties will become subject to cash dominion, which will require daily prepayment of loans under the ABL Credit Facility with the cash deposited in certain deposit accounts of the ABL Loan Parties, including concentration accounts, and will restrict the ABL Loan Parties’ ability to transfer cash from their concentration accounts to their disbursement accounts.

Such cash dominion period (a "Dominion Period") shall end when (i) if arising as a result of a continuing event of default, such event of default ceases to exist, (ii) if arising as a result of non-compliance with the Excess Availability threshold, no event of default is continuing and, for a period of 30 consecutive days, Excess Availability is equal to or greater than the greater of $12.5 million and 10% of the lesser of total revolving loan commitments under the ABL Credit Facility and the borrowing base, or (iii) if arising as a result of Domestic Availability being less than the threshold, no event of default is continuing and, for a period of 30 consecutive days, Domestic Availability is greater than $25.0 million and 20% of the lesser of total revolving loan commitments under the ABL Credit Facility and the borrowing base.

The ABL Credit Agreement governing the ABL Credit Facility contains a covenant requiring that the Company’s fixed charge coverage ratio be no less than 1.10 to 1.00 during any Dominion Period.

The ABL Credit Agreement governing the ABL Credit Facility contains customary representations and warranties, affirmative and negative covenants (subject, in each case, to exceptions and qualifications) and events of defaults, including covenants that limit the Company’s ability to, among other things:

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• consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets,

• enter into transactions with affiliates, and

• enter into transactions with affiliates,

• engage directly or indirectly in any business other than the businesses engaged in by the Company,

• directly or indirectly open, maintain or otherwise have accounts other than permitted accounts under the ABL Credit Agreement, and

• designate subsidiaries as Unrestricted Subsidiaries (as defined in the ABL Credit Agreement).

The ABL Credit Facility matures on May 12, 2030 or, if earlier, 90 days prior to the earliest maturity date of (i) the Company's existing senior secured notes and the senior secured term loans (each scheduled to mature on December 31, 2027) in the event any such notes or loans remain outstanding or (ii) any indebtedness that refinances any of the foregoing.

On March 31, 2026, the Borrowers were in compliance with the covenants under the ABL Credit Agreement.

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Debt Arrangements " to the "Notes to Consolidated Financial Statements" for additional information.

On May 12, 2025, the ABL Credit Agreement was amended to, among other things:

• increase the aggregate amount of the revolving loan commitments under the ABL Credit Facility by $30.0 million from $120.0 million to $150.0 million,

• reduce the margin for the interest rate by 0.25% per annum from 3.00% to 2.75% and eliminate the SOFR adjustment charge,

• reduce the commitment fee for the unused amounts of the ABL Credit Facility to 0.25%, and

• extend the maturity to May 12, 2030 or, if earlier, 90 days prior to the earliest stated maturity date of (i) the outstanding senior secured notes and the senior secured term loans (each currently scheduled to mature on December 31, 2027) or (ii) any indebtedness that refinances any of the foregoing.

Intabex Term Loans

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Pyxus Term Loans

Pursuant to the Exit Facility Exchange, on February 6, 2023, Pyxus Holdings entered into the Pyxus Term Loan Credit Agreement, dated as of February 6, 2023 (the "Pyxus Term Loan Credit Agreement"), by and among, Pyxus Holdings, the guarantors party thereto, the lenders party thereto and Alter Domus, as administrative agent and senior collateral agent, to establish a term loan credit facility in an aggregate principal amount of approximately $130.6 million (the "Pyxus Credit Facility"), under which term loans in the full aggregate principal amount of the Pyxus Credit Facility (the "Pyxus Term Loans"

and, together with the Intabex Term Loans, the "New Term Loans") were deemed made in exchange for 60.0% of the outstanding principal amount of Exit Term Loans (including the applicable accrued and unpaid PIK interest thereon).

The Pyxus Term Loans bear interest, at Pyxus Holdings’ option, at either (i) a term SOFR rate (subject to a floor of 1.5%) plus 8.0% per annum or (ii) an alternate base rate plus 7.0% per annum.

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8.50% Senior Secured Notes due 2027

Pursuant to an exchange offer (the "Notes Exchange" and, together with the DDTL Facility Exchange and the Exit Facility Exchange, the "Debt Exchange Transactions") made by Pyxus Holdings and accepted by holders of approximately 92.7% of the aggregate principal amount of the outstanding 10.0% Senior Secured First Lien Notes due 2024 issued by Pyxus Holdings (the "2024 Notes") pursuant to that certain Indenture, dated as of August 24, 2020 (the "2024 Notes Indenture"), by and among Pyxus Holdings, the guarantors party thereto and the trustee, collateral agent, registrar and paying agent thereunder, on February 6, 2023, Pyxus Holdings issued approximately $260.5 million in aggregate principal amount of 8.5% Senior Secured Notes due December 31, 2027 (the "2027 Notes" and, together with the New Term Loans, the "New Secured Debt") to the exchanging holders of the 2024 Notes for an equal principal amount of 2024 Notes.

Pursuant to an exchange offer (the "Notes Exchange" and, together with the DDTL Facility Exchange and the Exit Facility Exchange, the "Debt Exchange Transactions") made by Pyxus Holdings and accepted by holders of approximately 92.7% of the aggregate principal amount of the outstanding 10.0% Senior Secured First Lien Notes due 2024 issued by Pyxus Holdings (the "2024 Notes") pursuant to that certain Indenture, dated as of August 24, 2020 (the "2024 Notes Indenture"), by and among Pyxus Holdings, the guarantors party thereto and the trustee, collateral agent, registrar and paying agent thereunder, on February 6, 2023, Pyxus Holdings issued approximately $260.5 million in aggregate principal amount of 8.5% Senior Secured Notes due December 31, 2027 (the "2027 Notes" and, together with the Senior Secured Term Loans, the "Senior Secured Term Debt") to the exchanging holders of the 2024 Notes for an equal principal amount of 2024 Notes.

The 2027 Notes were issued pursuant to the Indenture, dated as of February 6, 2023 (the "2027 Notes Indenture"), among Pyxus Holdings, the guarantors party thereto, and Wilmington Trust, National Association, as trustee, and Alter Domus, as collateral agent.

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Guarantees and Collateral

The obligations of Pyxus Holdings under the ABL Credit Agreement and the New Secured Debt are fully and unconditionally guaranteed by the Company, Pyxus Parent and all of the Company’s domestic subsidiaries and certain of the Company’s foreign subsidiaries, subject to certain limitations (the "Senior Secured Debt Obligors").

The obligations of Pyxus Holdings under the ABL Credit Agreement and the Senior Secured Term Debt are fully and unconditionally guaranteed by the Company, Pyxus Parent and all of the Company’s domestic subsidiaries and certain of the Company’s foreign subsidiaries, subject to certain limitations (the "Senior Secured Debt Obligors").

In addition, under the Intabex Term Loan Credit Facility, Intabex and Alliance One International Tabak B.V.

(which were obligors under the DDTL Term Loans) also guarantee the Intabex Credit Facility (together, the "Specified Intabex Obligors") but do not guarantee the 2027 Notes, the Pyxus Term Loans or obligations under the ABL Credit Agreement.

In addition, certain assets of the Specified Intabex Obligors (which were pledged as collateral for the DDTL Term Loans) are pledged as collateral to secure the Intabex Term Loans (the

"Intabex Collateral") but do not secure the 2027 Notes, the Pyxus Term Loans, or obligations under the ABL Credit Agreement.

In addition, certain assets of the Specified Intabex Obligors (which were pledged as collateral for the DDTL Term Loans) are pledged as collateral to secure the Intabex

Term Loans (the "Intabex Collateral") but do not secure the 2027 Notes, the Pyxus Term Loans, or obligations under the ABL Credit Agreement.

On March 27, 2024, Alliance One International Tabak B.V.

was merged with and into Intabex.

The Senior Secured Debt Obligors’ obligations under the ABL Credit Agreement are secured by (i) a first-priority senior lien the ABL Priority Collateral (as defined in the ABL/New Secured Debt Intercreditor Agreement (as defined below)), which includes certain accounts receivable and inventory and certain related intercompany notes, cash, deposit accounts, related general intangibles and instruments, certain other related assets and proceeds of the foregoing of the Senior Secured Debt Obligors, and (ii) a junior-priority lien on substantially all assets of the Senior Secured Debt Obligors other than certain exclusions and the ABL Priority Collateral.

The New Secured Debt is secured by (i) a first-priority senior lien on substantially all assets of the Senior Secured Debt Obligors other than certain exclusions and the ABL Priority Collateral and (ii) a junior-priority lien on the ABL Priority Collateral.

The Senior Secured Debt Obligors’ obligations under the ABL Credit Agreement are secured by (i) a first-priority senior lien the ABL Priority Collateral (as defined in the ABL/Senior Secured Term Debt Intercreditor Agreement (as defined below)), which includes certain accounts receivable and inventory and certain related intercompany notes, cash, deposit accounts, related general intangibles and instruments, certain other related assets and proceeds of the foregoing of the Senior Secured Debt Obligors, and (ii) a junior-priority lien on substantially all assets of the Senior Secured Debt Obligors other than certain exclusions and the ABL Priority Collateral.

The Senior Secured Term Debt is secured by (i) a first-priority senior lien on substantially all assets of the Senior Secured Debt Obligors other than certain exclusions and the ABL Priority Collateral and (ii) a junior-priority lien on the ABL Priority Collateral.

The Intabex Term Loans are further secured by a first-priority lien on the Intabex Collateral.

The obligations under the New Secured Debt share a single lien, held by Alter Domus, as senior collateral agent (the "Senior Collateral Agent"), on the Collateral (as defined below) subject to the payment waterfall pursuant to the intercreditor arrangements described below.

The obligations under the Senior Secured Term Debt share a single lien, held by Alter Domus, as senior collateral agent (the "Senior Collateral Agent"), on the Collateral (as defined below) subject to the payment waterfall pursuant to the intercreditor arrangements described below.

See " Note 16.

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Intercreditor Agreements

The priority of the obligations under the ABL Credit Agreement and the New Secured Debt are set forth in the two intercreditor agreements entered into in connection with consummation of the DDTL Facility Exchange, the Exit Facility Exchange and the Notes Exchange.

ABL/New Secured Debt Intercreditor Agreement .

On February 6, 2023, Pyxus Holdings, Inc., the guarantors party thereto, PNC Bank, National Association, as ABL Agent, Alter Domus, as Pyxus Term Loan Administrative Agent, Intabex Term Loan Administrative Agent and Senior Collateral Agent, and Wilmington Trust, National Association, as Senior Notes Trustee entered into an Amended and Restated ABL Intercreditor Agreement, dated as of February 6, 2023 (the "ABL/New Secured Debt Intercreditor Agreement") to provide for the intercreditor relationship between, (i) on one hand, the holders of obligations under the ABL Credit Facility, the guarantees thereof and certain related obligations and (ii) on the other hand, the holders of obligations under the New Secured Debt, the guarantees thereof and certain related obligations.

Pursuant to the terms of the ABL/Term Loan/Notes Intercreditor Agreement, Pyxus Holdings’ obligations under the ABL Credit Facility, the guarantees thereof and certain related obligations have first-priority senior liens on the ABL Priority Collateral, which includes certain accounts receivable and inventory and certain related intercompany notes, cash, deposit accounts, related general intangibles and instruments, certain other related assets of the foregoing entities and proceeds of the foregoing, with the obligations under the New Secured Debt having junior-priority liens on the ABL Priority Collateral.

Pursuant to the ABL/New Secured Debt Intercreditor Agreement, Pyxus Holdings’ collective obligations under the New Secured Debt, the guarantees thereof and certain related obligations have first-priority senior liens on the collateral that is not ABL Priority Collateral, including owned material real property in the U.S., capital stock of subsidiaries owned directly by Pyxus Holdings or a guarantor (other than the Intabex Collateral), existing and after acquired intellectual property rights, equipment, related general intangibles and instruments and certain other assets related to the foregoing and proceeds of the foregoing, with the obligations under the ABL Credit Facility having junior-priority liens on such collateral, other than real property.

The priority of the obligations under the ABL Credit Agreement and the Senior Secured Term Debt are set forth in the two intercreditor agreements entered into in connection with consummation of the DDTL Facility Exchange, the Exit Facility Exchange and the Notes Exchange.

ABL/Senior Secured Term Debt Intercreditor Agreement .

On February 6, 2023, Pyxus Holdings, Inc., the guarantors party thereto, PNC Bank, National Association, as ABL Agent, Alter Domus, as Pyxus Term Loan Administrative Agent, Intabex Term Loan Administrative Agent and Senior Collateral Agent, and Wilmington Trust, National Association, as Senior Notes Trustee entered into an Amended and Restated ABL Intercreditor Agreement, dated as of February 6, 2023 (the "ABL/Senior Secured Term Debt Intercreditor Agreement") to provide for the intercreditor relationship between, (i) on one hand, the holders of obligations under the ABL Credit Facility, the guarantees thereof and certain related obligations and (ii) on the other hand, the holders of obligations under the Senior Secured Term Debt, the guarantees thereof and certain related obligations.

Pursuant to the terms of the ABL/Term Loan/Notes Intercreditor Agreement, Pyxus Holdings’ obligations under the ABL Credit Facility, the guarantees thereof and certain related obligations have first-priority senior liens on the ABL Priority Collateral, which includes certain accounts receivable and inventory and certain related intercompany notes, cash, deposit accounts, related general intangibles and instruments, certain other related assets of the foregoing entities and proceeds of the foregoing, with the obligations under the Senior Secured Term Debt having junior-priority liens on the ABL Priority Collateral.

Pursuant to the ABL/Senior Secured Term Debt Intercreditor Agreement, Pyxus Holdings’ collective obligations under the Senior Secured Term Debt, the guarantees thereof and certain related obligations have first-priority senior liens on the collateral that is not ABL Priority Collateral, including owned material real property in the U.S., capital stock of subsidiaries owned directly by Pyxus Holdings or a guarantor (other than the Intabex Collateral), existing and after acquired intellectual property rights, equipment, related general intangibles and instruments and certain other assets related to the foregoing and proceeds of the foregoing, with the obligations under the ABL Credit Facility having junior-priority liens on such collateral, other than real property.

The ABL Credit Facility is not secured by real property.

Secured Debt Intercreditor Agreement .

On February 6, 2023, the New Secured Debt Obligors, together with the representative for the holders of the New Secured Debt and the Senior Collateral Agent, entered into the Intercreditor and Collateral Agency Agreement, dated as of February 6, 2023 (the "New Secured Debt Intercreditor Agreement"), pursuant to which the Senior Collateral Agent, serves as joint collateral agent for the benefit of the holders of the 2027 Notes, the Pyxus Term Loans and the Intabex Term Loans with respect to all common collateral securing such indebtedness (the "Collateral";

which excludes Intabex Collateral).

The New Secured Debt Intercreditor Agreement provides that Collateral or proceeds thereof received in connection with or upon the exercise of secured creditor remedies will be distributed (subject to the provisions described in the next paragraph) first to holders of the New Secured Debt on a pro rata basis based on the aggregate principal amount of each class of New Secured Debt, and then to holders of future junior debt secured by such Collateral on a pro rata basis based on the aggregate principal amount of each class of future junior debt (and in each case permitted refinancing indebtedness thereof).

Exercise of rights and remedies against the Collateral and certain rights in a bankruptcy or insolvency proceeding (including the right to object to debtor-in-possession financing or to credit bid) by the Senior Collateral Agent will be controlled first by the holders of a majority in principal amount of the New Term Loans (including, in any event, each holder holding at least 20.0% of the New Term Loans as of February 6, 2023, provided such holder holds at least 15.0% of the New Term Loans as of the date of determination), second, after repayment in full of the New Term Loans, by the holders of a majority in principal amount of the 2027 Notes and last, after repayment in full of the New Term Loans and the 2027 Notes, by holders of a majority in

principal amount of any future junior debt secured by the Collateral.

On February 6, 2023, the Senior Secured Debt Obligors, together with the representative for the holders of the Senior Secured Term Debt and the Senior Collateral Agent, entered into the Intercreditor and Collateral Agency Agreement, dated as of February 6, 2023 (the "Senior Secured Term Debt Intercreditor Agreement"), pursuant to which the Senior Collateral Agent, serves as joint collateral agent for the benefit of the holders of the 2027 Notes, the Pyxus Term Loans and the Intabex Term Loans with respect to all common collateral securing such indebtedness (the "Collateral," which excludes Intabex Collateral).

The Senior Secured Term Debt Intercreditor Agreement provides that Collateral or proceeds thereof received in connection with or upon the exercise of secured creditor remedies will be distributed (subject to the provisions described in the next paragraph) first to holders of the Senior Secured Term Debt on a pro rata basis based on the aggregate principal amount of each class of Senior Secured Term Debt, and then to holders of future junior debt secured by such Collateral on a pro rata basis based on the aggregate principal amount of each class of future junior debt (and in each case permitted refinancing indebtedness thereof).

Exercise of rights and remedies against the Collateral and certain rights in a bankruptcy or insolvency proceeding (including the right to object to debtor-in-possession financing or to credit bid) by the Senior Collateral Agent will be controlled first by the holders of a majority in principal amount of the Senior Secured Term Loans (including, in any event, each holder holding at least 20.0% of the Senior Secured Term Loans as of February 6, 2023, provided such holder holds at least 15.0% of the Senior Secured Term Loans as of the date of determination), second, after repayment in full of the Senior Secured Term Loans, by the

holders of a majority in principal amount of the 2027 Notes and last, after repayment in full of the Senior Secured Term Loans and the 2027 Notes, by holders of a majority in principal amount of any future junior debt secured by the Collateral.

Any such future junior debt will be subject to certain customary waivers of rights in a bankruptcy or insolvency proceeding in favor of the Senior Collateral Agent, including, but not limited to, with respect to debtor-in-possession financing, adequate protection, and credit bidding.

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Debt Arrangements " to the "Notes to Consolidated Financial Statements" for additional information.

The 2024 Notes bore interest at a rate of 10.0% per year, payable semi-annually in arrears in cash on February 15 and August 15 of each year.

On August 26, 2024, upon maturity of the 2024 Notes, Pyxus Holdings paid $20.4 million, which included less than $0.1 million for accrued and unpaid interest, to retire the 2024 Notes.

Related Party Transactions

Based on a Schedule 13D/A filed with the SEC on March 25, 2024, by Monarch Alternative Capital LP (the "Monarch Investor"), MDRA GP LP and Monarch GP LLC, the Monarch Investor reported beneficial ownership of 6.125 million shares of the Company’s common stock, representing approximately 24.5% of the then outstanding shares of the Company’s common stock.

An individual designated by the Monarch Investor serves as a director of Pyxus.

On March 21, 2024, Pyxus Holdings entered into an agreement (the "Debt Repurchase Agreement") with funds affiliated with the Monarch Investor to purchase $77.9 million of aggregate principal amount of their holdings in the 2027 Notes for $60.0 million, a 23.0% discount to par value, plus accrued and unpaid interest and specified customary fees.

The purchase of $77.9 million aggregate principal amount of the 2027 Notes for a total of $62.3 million (including fees and accrued and unpaid interest) was completed on March 28, 2024.

The Debt Repurchase Agreement also included the right of Pyxus Holdings, at its option, to purchase from such holders an additional $34.2 million aggregate principal amount of the 2027 Notes for $26.3 million, a 23.0% discount to par value, plus accrued and unpaid interest, and $10.3 million aggregate principal amount of the Pyxus Term Loans for $9.1 million, a 12.0% discount to par value, plus accrued and unpaid interest.

On April 12, 2024, Pyxus Holdings exercised its right to complete these repurchases by September 30, 2024.

On May 31, 2024, Pyxus Holdings completed the purchase of $10.3 million of aggregate principal amount of the Pyxus Term Loans for a total of $9.4 million (including accrued and unpaid interest).

On August 2, 2024, Pyxus Holdings completed the purchase of $34.2 million of aggregate principal amount of the 2027 Notes for a total of $26.7 million (including accrued and unpaid interest).

The Debt Repurchase Agreement and the transactions contemplated thereunder were approved and determined to be on terms and conditions at least as favorable to the Company and its subsidiaries as could reasonably have been obtained in a comparable arm's-length transaction with an unaffiliated party by a majority of the disinterested members of the Board of Directors of Pyxus.

Seasonal Lines of Credit

Excluding its long-term credit arrangements, the Company typically finances its foreign operations with committed and uncommitted short-term seasonal lines of credit arrangements with numerous banks.

Foreign Seasonal Lines of Credit

Excluding long-term credit arrangements, the Company typically finances its foreign operations with committed and uncommitted short-term foreign seasonal lines of credit arrangements with a number of banks.

These operating lines are generally seasonal in nature, typically extending for a term of 180 to 365 days corresponding to the tobacco crop cycle in that location.

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These loans are generally renewed at the outset of each tobacco season.

Certain of the seasonal lines of credit are guaranteed by the Company and certain of its subsidiaries.

At March 31, 2025, the total borrowing capacity under individual seasonal lines of credit range up to $170.0 million.

At March 31, 2025, the aggregate outstanding borrowings of the Company under these seasonal credit lines, including letters of credit, was approximately $388.6 million and approximately $525.4 million was available for borrowing under these seasonal credit lines, subject to limitations as provided under the ABL Credit Agreement and the agreements governing the New Secured Debt.

The weighted average variable interest rate for these seasonal lines of credit for the year ended March 31, 2025 was 9.4%.

Certain of the seasonal lines of credit, with aggregate outstanding borrowings at March 31, 2025 of approximately $93.2 million, are secured by trade receivables and inventories as collateral.

At March 31, 2025, the Company and its subsidiaries were in compliance with the covenants associated with the short-term seasonal lines of credit.

Seasonal liquidity beyond cash flow from operations is provided by our seasonal lines of credit, advances from customers, and sales of accounts receivable.

For the year ended March 31, 2025, our average short-term borrowings, quarter-end peak short-term borrowings outstanding, and weighted-average interest rate on short-term borrowings were as follows:

Certain of the foreign seasonal lines of credit are guaranteed by the Company and certain of its subsidiaries.

At March 31, 2026, the total borrowing capacity under individual foreign seasonal lines of credit range up to $170.0 million.

Certain of the foreign seasonal lines of credit, with aggregate outstanding borrowings at March 31, 2026 of approximately $106.9 million, are secured by trade receivables and inventories as collateral.

At March 31, 2026, the Company and its subsidiaries were in compliance with the covenants associated with its short-term foreign seasonal lines of credit.

Seasonal liquidity beyond cash flow from operations is provided by our foreign seasonal lines of credit, advances from customers, and sales of accounts receivable.

Our average short-term borrowings, peak quarter-end short-term borrowings outstanding, and weighted-average interest rate on short-term borrowings were as follows:

Years Ended March 31,

(in millions) 2026 2025

Average short-term borrowings $ 807.1 $ 624.7

Quarter-end peak short-term borrowings outstanding $ 823.5 $ 553.1

Peak quarter-end short-term borrowings outstanding $ 908.0 $ 744.8

Weighted-average interest rate on short-term borrowings 8.8% 9.4%

Quarter-end peak borrowings for the year ended March 31, 2025 occurred during the third quarter, which was driven by outstanding borrowings in Africa and South America.

The increase in average and peak borrowings when compared to the prior year is due to the increase in the average cost per kilo of tobacco as a result of undersupply conditions and inflation.

Peak quarter-end borrowings for the year ended March 31, 2026 were at the end of the second quarter, which was driven by outstanding borrowings in Africa and South America.

The increase in average and peak quarter-end borrowings when compared to the prior year is due to the larger crops the Company procured from our origins within those same regions.

Borrowings during the prior year and in the current year were repaid with cash provided by operating activities.

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March 31, 2026 March 31, 2025

(in millions) Total Borrowing Capacity Remaining Amounts Available Total Borrowing Capacity Remaining Amounts Available

(in millions) Total Borrowing Capacity Remaining Amount Available Total Borrowing Capacity Remaining Amount Available

Senior Secured Credit Facilities:

ABL Credit Facility $ 150.0 $ 150.0 $ 120.0 $ 120.0

Seasonal lines of credit 906.2 525.4 767.5 307.2

Foreign seasonal lines of credit 1,053.4 594.3 906.2 525.4

Other long-term debt — — 0.4 0.4

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Total $ 1,214.4 $ 747.3 $ 1,038.8 $ 650.2

The total borrowing capacity under the ABL Credit Facility increased $30.0 million when compared to the prior year as a result of the Fourth Amendment to the ABL Credit Agreement entered into on May 12, 2025, which among other things, increased the aggregate amount of revolving loan commitments from $120.0 million to $150.0 million.

The amounts presented as available under the ABL Credit Facility are subject to further limitations from the borrowing base consisting of certain eligible accounts receivable and inventory, reduced by specified reserves.

The amounts presented as the remaining amount available for borrowing under the foreign seasonal lines of credit are subject to limitations based on the level of receivables and inventories as collateral and by certain restrictive covenants.

The total borrowing capacity of our foreign seasonal lines of credit increased $147.2 million when compared to the prior year and were primarily utilized to purchase larger volumes of green tobacco.

The amounts presented as the total borrowing capacity and the remaining amount available for borrowing under the foreign seasonal lines of credit are subject to limitations based on the level of receivables and inventories as collateral and by certain restrictive covenants, including covenants under the ABL Credit Agreement and the agreements governing the Senior Secured Term Debt.

We refer to "Net debt," a non-GAAP measure, as total debt liabilities less cash and cash equivalents.

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In addition, net debt suggests that our debt obligations are less than the most comparable GAAP measure indicates.

The following summarizes the computation of net debt:

(in millions) 2026 2025

Notes payable $ 477.1 $ 395.0

Current portion of long-term debt — 20.3

Long-term debt (1)

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Net debt $ 798.6 $ 771.6

(1) Includes amounts outstanding under the ABL Credit Facility.

(1) Fluctuations in long-term debt include borrowings and repayments on the outstanding indebtedness under the ABL Credit Facility.

Weighted average borrowings outstanding under the ABL Credit Facility were $47.4 million for the fiscal year ended March 31, 2026.

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Operating leases payable 9.9 8.5 1.4 16.5

Current portion of long-term debt — 20.3 (20.3) **

Total current liabilities* $ 932.8 $ 773.9 158.9 20.5

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*Amounts may not equal column totals due to rounding.

**Not meaningful for comparison purposes.

Working capital declined $20.7 million, or 5.1%, to $384.3 million as of March 31, 2025 from $405.0 million as of March 31, 2024, primarily due to reduction in inventory caused by the weather effects of El Niño resulting in shorter crops in South America and certain markets in Africa, accelerated shipments from Africa in the three months ended March 31, 2025 of the type that occurred in the prior year in the three months ended June 30, 2024, and delayed purchases in South America in the three months ended March 31, 2025 compared to the prior year.

The reduction in inventory was partially offset by higher repayments on seasonal lines of credit and the repayment of the current portion of long-term debt for the 10.0% Notes due 2024 upon maturity.

Working capital increased $13.4 million, or 3.5%, to $397.7 million as of March 31, 2026 from $384.3 million as of March 31, 2025.

The improvement in working capital reflects increased inventories and advances to tobacco suppliers, net from larger crops in Africa and South America, the timing and related impact of higher sales during the three months ended March 31, 2026 versus the same period a year ago, and an increase in cash and cash equivalents primarily from financing activities.

increase in these current asset balances were partially offset by increased borrowings under foreign seasonal lines of credit to capture the higher crop volumes primarily in our Southern Hemisphere origins, an increase in advances from customers for future shipments of tobacco, and higher accrued expenses due to the timing of certain accruals, including an increase for accrued freight costs.

The following summarizes inventory committed to a customer and uncommitted inventory balances for processed tobacco:

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Total processed tobacco $ 507.4 $ 490.4

Processed tobacco decreased $94.9 million, or 16.2%, to $490.4 million as of March 31, 2025 from $585.3 million as of March 31, 2024 primarily due to the weather effects of El Niño resulting in shorter crops in South America and certain markets in Africa and accelerated shipments from Africa in the three months ended March 31, 2025 of the type that occurred in the prior year in the three months ended June 30, 2024.

Uncommitted levels of processed tobacco remain low as undersupply conditions persist in the global tobacco market.

Total processed tobacco increased $17.0 million, or 3.5%, to $507.4 million as of March 31, 2026 from $490.4 million as of March 31, 2025.

The increase primarily reflects larger crop volumes purchased and processed in Africa.

We expected an increase in our uncommitted inventories when compared to the prior fiscal year, a consistent trend since the second quarter of fiscal year 2026, and the increase at March 31, 2026 is indicative of the shift to an oversupply position in the global tobacco market as we enter fiscal 2027.

See " Note 1.

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We utilize capital in excess of cash flow from operations to finance accounts receivable, inventory, and advances to tobacco suppliers in foreign countries.

In addition, we may periodically elect to purchase, redeem, repay, retire, or cancel indebtedness prior to stated maturity under our various seasonal credit lines.

As of March 31, 2025, our cash, cash equivalents, and restricted cash was $85.5 million, of which $49.3 million was held in foreign jurisdictions for non-U.S.

working capital needs, a majority of which is subject to exchange controls and a portion of which is subject to tax consequences upon repatriation, which could limit our ability to fully repatriate these funds.

In addition, we may periodically elect to purchase, redeem, repay, retire, or cancel indebtedness prior to stated maturity under our various foreign seasonal credit lines.

As of March 31, 2026, our cash, cash equivalents, and restricted cash was $137.7 million, of which $99.4 million was held in foreign jurisdictions for working capital needs, a majority of which is subject to exchange controls and a portion of which is subject to tax consequences upon repatriation, which could limit our ability to fully repatriate these funds.

Fluctuation of the U.S.

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(in millions) 2026 2025 2024

Net income (loss) $ 16.5 $ 3.2 $ (38.2)

Net income $ 15.7 $ 16.5 $ 3.2

Trade and other receivables (254.9) (208.4) (167.6)

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Net cash provided by investing activities $ 191.4 $ 170.6 $ 159.4

Net (repayments) proceeds from short-term borrowings (102.6) 122.5 5.2

Net (repayments) proceeds from long-term borrowings (55.8) (60.3) 0.2

Net (repayments) from revolving loan facilities — (25.0) (65.0)

Net proceeds (repayments) from short-term borrowings 77.3 (102.6) 122.5

Repayments of long-term borrowings — (55.8) (60.3)

Net repayments of revolving loan facilities — — (25.0)

Other (4.8) (8.9) (11.6)

Net cash (used in) provided by financing activities $ (167.3) $ 25.6 $ (83.0)

Net cash provided by (used in) financing activities $ 72.5 $ (167.3) $ 25.6

Effect of exchange rate changes on cash (3.4) (4.2) (9.2)

Decrease in cash, cash equivalents, and restricted cash* $ (14.2) $ (39.1) $ (62.4)

Increase (decrease) in cash, cash equivalents, and restricted cash* $ 52.1 $ (14.2) $ (39.1)

*Amounts may not equal totals due to rounding.

The change in cash, cash equivalents, and restricted cash for the fiscal year ended March 31, 2026 compared to the fiscal year ended March 31, 2025 increased by $66.3 million.

The increase was primarily due to a reduction in inventory from the weather effects of El Niño resulting in shorter crops in South America and certain markets in Africa and accelerated shipments from Africa in the three months ended March 31, 2025 of the type that occurred in the prior year in the three months ended June 30, 2024.

This increase was partially offset by higher repayments on seasonal lines of credit for purchases of more expensive green tobacco, the repurchase of certain long-term debt, and the repayment of the 10.0% Notes due 2024 upon maturity.

Cash Paid for Income Taxes, net

Excluding cash paid for income taxes of $12.5 million related to the debt exchange transactions in the prior fiscal year, cash paid for income taxes, net increased for the fiscal year ended March 31, 2025 to $31.1 million compared to $22.5 million for fiscal year ended March 31, 2024.

This increase was primarily due to multi-year tax settlements in Africa and an increase in income before income taxes, partially offset by deferred payments in North America.

The increase was due to higher net proceeds received from foreign seasonal lines of credit and the non-recurrence of partial repayments made on long-term debt in the prior-year period, partially offset by an increase in cash used to purchase larger crop volumes.

Planned Capital Expenditures

We are estimating $26.1 million in capital investments for fiscal 2026 for routine replacement of equipment, as well as investments in assets to enhance our sustainability efforts or increase efficiencies, which we believe will add value to our customers.

We are anticipating $38.4 million in capital investments for fiscal 2027, which includes the new construction of a warehouse in South America and significant refurbishments to an existing warehouse in Africa.

Both of these projects are aligned with advancing the Company's strategic initiatives to drive long-term efficiencies and cost optimization.

The remainder of our expected capital spend is for the routine replacement of machinery and equipment, and investments in other such assets to enhance our operational effectiveness and to support our ongoing sustainability efforts.

Securitized Receivables

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Securitized Receivables " to the "Notes to Consolidated Financial Statements" for additional information.

Aggregate Contractual Obligations and Commitments

The following summarizes our contractual obligations and other commercial commitments as of March 31, 2025 :

Future Contractual Obligations and Commitments

The following summarizes our material contractual obligations and commercial commitments as of March 31, 2026 :

Payments / Expirations by Fiscal Year

(in millions) Total 2027 Years

2027-2028 Years

2029-2030 After

Long-Term Debt Obligations $ 455.8 $ — $ 455.8 $ — $ —

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Amounts Guaranteed for Tobacco Suppliers 119.7 119.7 — — —

Total Contractual Obligations and Other

Commercial Commitments $ 1,967.0 $ 1,346.3 $ 571.0 $ 16.7 $ 33.0

(1) Short-term debt obligations consist of our seasonal credit lines.

(2) Interest obligations includes interest for long-term debt, including indebtedness under the ABL Credit Facility.

Total $ 2,041.0 $ 1,472.7 $ 520.0 $ 17.7 $ 30.6

(1) Short-term debt obligations consist of our foreign seasonal credit lines.

(2) Interest obligations include interest for long-term debt, including indebtedness under the ABL Credit Facility.

The projected interest includes both fixed and variable rate debt.

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Other purchase obligations consist primarily of purchase commitments of agricultural material.

Tobacco and other purchase obligations increased $194.6 million, or 34%, from $576.1 million to $770.7 million primarily due to higher estimated volumes from Africa and South America.

Tobacco and other purchase obligations increased $35.4 million, or 4.6%, from $770.7 million to $806.1 million primarily due to higher estimated volumes expected to be sourced from our key origins in South America and Asia, and higher estimated volumes with increased pricing due to inflationary pressures in Europe.

Amounts Guaranteed for Tobacco Suppliers

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We regularly evaluate the status of the accumulated unremitted earnings of each of our foreign subsidiaries.

Our ability to repatriate unremitted foreign earnings may be limited by local legal restrictions and foreign exchange controls in certain jurisdictions in which we operate.

If the undistributed earnings are needed in the U.S., we may be required to pay state income and/or foreign local withholding taxes upon repatriation.

Our ability to repatriate unremitted non-U.S earnings may be limited by local legal restrictions and exchange controls in certain jurisdictions in which we operate.

If the undistributed earnings are needed in the U.S., we may be required to pay state income and/or non-U.S local withholding taxes upon repatriation.

We provide deferred income taxes, net of creditable foreign taxes, if applicable, on earnings that are not indefinitely invested.

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Changes in assumptions are made if there are significant deviations or if future expectations change significantly.

The Company terminated one of its defined benefit pension plans in the United Kingdom ("U.K.

Pension Plan") during the year ended March 31, 2024.

Based upon anticipated changes in assumptions, pension and postretirement expense for the year ending March 31, 2026 is expected to be consistent with the year ended March 31, 2025.

Based upon anticipated

changes in assumptions, pension and postretirement expense for the year ending March 31, 2027 is expected to be consistent with the year ended March 31, 2026.

The contribution to our employee benefit plans during the year ended March 31, 2026 was $4.3 million and is expected to be $4.5 mil lion in fiscal 2027.

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1% decrease in discount rate $ 4,529 $ 224

1% increase in salary increase assumption $ 142 $ 39

1% decrease in salary increase assumption $ (133) $ (37)

1% increase in rate of return on assets $ (219)

1% decrease in rate of return on assets $ 219

1% increase in salary rate $ 172 $ 52

1% decrease in salary rate $ (161) $ (46)

1% increase in rate of return on assets Not applicable $ (194)

1% decrease in rate of return on assets Not applicable $ 194

Changes in assumptions for other postretirement benefits are no longer applicable as the benefit is capped and no longer subject to inflation.

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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-K

Item 7. Management’s Discussion and Analysis