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Item 2. Management’s Discussion and Analysis

2025-05-08 compared with 2024-11-04 · 127 added, 268 removed, 262 unchanged (60% of the section changed)

5 unchanged sentences

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

Net revenue for the three months ended September 30, 2024 was $982.8 million, a decrease of 1.8% on a reported and organic basis compared to $1,001.3 million in the prior period.

Net revenue for the nine months ended September 30, 2024 was $3,025.1 million, a decrease of 1.2% compared to $3,061.6 million in the prior period.

Excluding a decrease of 0.9% attributed to changes in foreign currency exchange rates, net revenue decreased 0.3% on an organic basis.

Net revenue for the three months ended March 31, 2025 was $911.3 million, a decrease of 9.5% on a reported basis compared to $1,006.7 million in the prior period.

Excluding a decrease of 0.6% attributed to changes in foreign currency exchange rates and a decrease of 4.5% related to the effect of disposals, net revenue decreased 4.4% on an organic basis.

Organic revenue growth (or decline), discussed throughout this Item 2:

1 unchanged sentence

Refer to Non-GAAP Financial Measures included elsewhere in this MD&A for additional information regarding our use of organic revenue growth (or decline).

Operating loss for the three months ended September 30, 2024 was $199.2 million (20.3% of net revenue), a decrease of $315.5 million, or 271.4% compared to operating income of $116.3 million (11.6% of net revenue) in the three months ended September 30, 2023.Operating income for the nine months ended September 30, 2024 decreased $307.6 million, or 80.3%, to $75.5 million (2.5% of net revenue) from $383.1 million (12.5% of net revenue) in the nine months ended September 30, 2023.

Refer to Results of Operations included elsewhere in this MD&A for additional discussion of our earnings results for the three and nine months ended September 30, 2024 compared to the prior year periods.

We generated $380.8 million of operating cash flows in the nine months ended September 30, 2024, ending the quarter with $506.2 million in cash and cash equivalents.

In the nine months ended September 30, 2024, we used cash of approximately $126.8 million for capital expenditures, $54.3 million for payment of cash dividends, and $47.3 million for share repurchases as part of our share repurchase plan.

In the third quarter of 2024, impairment indicators were identified that suggested the carrying value of the Dynapower reporting unit could exceed its fair value.

We determined that this reporting unit was impaired, and we recorded a $150.1 million non-

cash impairment charge.

Refer to Note 13:

Fair Value Measures of the Financial Statements, included elsewhere in this Report, for additional information.

In August 2024, we executed a purchase agreement whereby we agreed to sell the Insights Business to an affiliate of Balmoral Funds.

The total purchase price of the Insights Business was $165.0 million, with approximately $155.0 million before adjustments received and $10.0 million to be received twelve months after the closing of the transaction.

In both the three months and nine months ended September 30, 2024, we recognized a loss on sale of approximately $110.1 million presented in restructuring and other charges, net in our condensed consolidated statements of operations, and approximately $11.2 million of transaction-related expenses, which were presented in SG&A in our condensed consolidated statements of operations.

Disposal of the Financial Statements included elsewhere in this Report for additional information.

In June 2024, our indirect, wholly-owned subsidiary, STI, completed the issuance and sale of the 6.625% Senior Notes.

We used the proceeds from this issuance, together with cash on hand, for the redemption in full of the 5.0% Senior Notes, which were issued by our indirect, wholly-owned subsidiary, STBV.

This redemption was completed in July 2024.

Refer to Note 10:

Debt of the Financial Statements included elsewhere in this Report, for additional information regarding these debt transactions.

We executed the issuance of the 6.625% Senior Notes and the subsequent redemption of the 5.0% Senior Notes to eliminate the near-term uncertainty related to the 5.0% Senior Notes, which would have been due in October 2025, to extend the maturity horizon of our capital structure, and to add flexibility to our liquidity position.

On September 30, 2024, our net leverage ratio was 3.0x, compared to 3.2x at both June 30, 2024 and December 31, 2023.

In the three months ended March 31, 2024, we realigned our business as a result of organizational changes that better allocate our resources to support changes to our business strategy.

The most significant changes include combining our Automotive and HVOR businesses (with the combined business remaining in Performance Sensing) and moving the Insights Business out of Performance Sensing to a new operating segment, which is not aggregated within either of our reportable segments.

We combined the Automotive and HVOR businesses to better leverage our core capabilities and prioritize product focus.

We also moved certain shorter-cycle businesses from Performance Sensing to Sensing Solutions, which will benefit from organizing our predominantly shorter-cycle businesses together, by allowing us to scale core capabilities and better serve our customers.

Prior year amounts in this Report have been recast to reflect this realignment.

Refer to Note 1:

Basis of Presentation and Note 15:

Segment Reporting of the Financial Statements included elsewhere in this Report for additional information.

Operating income for the three months ended March 31, 2025 was $122.2 million (13.4% of net revenue), a decrease of $22.6 million, or 15.6% compared to operating income of $144.8 million (14.4% of net revenue) in the three months ended March 31, 2024.

Refer to Results of Operations included elsewhere in this MD&A for additional discussion of our earnings results for the three months ended March 31, 2025 compared to the prior year period.

We generated $119.2 million of operating cash flows in the three months ended March 31, 2025, ending the quarter with $588.1 million in cash and cash equivalents.

In the three months ended March 31, 2025, we used cash of approximately $32.6 million for capital expenditures, $17.9 million for payment of cash dividends, and $100.5 million for share repurchases as part of our share repurchase plan.

Results of Operations

The table below presents our historical results of operations, in millions of dollars and as a percentage of net revenue, for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023.

We have derived the results of operations from the Financial Statements included elsewhere in this Report.

Prior year periods have been recast to reflect the reorganization of segments as detailed in Note 1:

Basis of Presentation of the Financial Statements included elsewhere in this Report.

The table below presents our historical results of operations, in millions of dollars and as a percentage of net revenue, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.

We have derived the results of

operations from the Financial Statements included elsewhere in this Report.

Amounts and percentages in the table below have been calculated based on unrounded numbers.

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the three months ended For the nine months ended

September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Amount Percent (1)

For the three months ended

March 31, 2025 March 31, 2024

Amount Percent

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Operating costs and expenses 789.1 86.6 861.9 85.6

Operating (loss)/income (199.2) (20.3) 116.3 11.6 75.5 2.5 383.1 12.5

Operating income 122.2 13.4 144.8 14.4

Interest expense (38.0) (4.2) (38.4) (3.8)

1 unchanged sentence

Other, net 2.1 0.2 (11.5) (1.1)

(Loss)/income before taxes (244.6) (24.9) 80.7 8.1 (47.0) (1.6) 259.8 8.5

(Benefit from)/provision for income taxes (219.6) (22.3) 17.9 1.8 (169.7) (5.6) 61.5 2.0

Net (loss)/income $ (25.0) (2.5) % $ 62.8 6.3 % $ 122.7 4.1 % $ 198.3 6.5 %

___________________________________

(1) Represents the amount presented divided by total net revenue.

Net revenue for the three months ended September 30, 2024 decreased 1.8% compared to the prior period.

Net revenue for the nine months ended September 30, 2024 decreased 1.2% compared to the prior period.

Net revenue decreased 0.3% on an organic basis, which excludes a decrease of 0.9% attributed to changes in foreign currency exchange rates.

Income before taxes 90.6 9.9 98.6 9.8

Provision for income taxes 20.7 2.3 22.6 2.2

Net income $ 69.9 7.7 % $ 76.0 7.6 %

Net revenue for the three months ended March 31, 2025 decreased 9.5% compared to the prior period.

Net revenue decreased 4.4% on an organic basis, which excludes a decrease of 0.6% attributed to changes in foreign currency exchange rates and a decrease of 4.5% due primarily to the effects of the divestiture of the Insights business in the third quarter of 2024.

Performance Sensing

Performance Sensing net revenue for the three months ended September 30, 2024 decreased 5.3% on a reported and organic basis compared to the prior period, which was primarily due to market decline across our vehicle end markets.

Performance Sensing net revenue for the nine months ended September 30, 2024 increased 1.9% compared to the prior period.

Excluding a decrease of 1.2% attributed to changes in foreign currency exchange rates, Performance Sensing net revenue increased 3.1% on an organic basis, which was primarily due to content growth across our vehicle end markets, partially offset by market declines.

Performance Sensing net revenue for the three months ended March 31, 2025 decreased 8.8% on a reported basis and 7.5% on an organic basis compared to the prior period, which was primarily due to decreases in automotive and HVOR production levels in North America and Europe.

Sensing Solutions

Sensing Solutions net revenue for the three months ended September 30, 2024 decreased 0.3% on a reported and organic basis compared to the prior period, which is primarily due to inventory destocking in our aerospace and industrial markets, partially offset by market growth in our industrial market.

Sensing Solutions net revenue for the nine months ended September 30, 2024 decreased 10.0% compared to the prior period.

Excluding a decline of 0.5% attributed to changes in foreign currency exchange rates, Sensing Solutions net revenue declined 9.5% on an organic basis, which is primarily due to the non-recurrence of one-time pass-through revenue in 2023 and inventory destocking in the industrial and aerospace markets, partially offset by growth in our aerospace and industrial markets.

Sensing Solutions net revenue for the three months ended March 31, 2025 increased 1.2% on a reported basis and 3.8% on an organic basis compared to the prior period, which is primarily growth in our industrial market.

Operating costs and expenses

Operating costs and expenses for the three and nine months ended September 30, 2024 and 2023 are presented, in millions of dollars and as a percentage of net revenue, in the following table.

Operating costs and expenses for the three months ended March 31, 2025 and 2024 are presented, in millions of dollars and as a percentage of net revenue, in the following table.

Amounts and percentages in the table below have been calculated based on unrounded numbers.

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the three months ended For the nine months ended

September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Amount Percent (1)

For the three months ended

March 31, 2025 March 31, 2024

Amount Percent

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Amortization of intangible assets 20.6 2.3 38.5 3.8

Goodwill impairment charge 150.1 15.3 — — 150.1 5.0 — —

Restructuring and other charges, net 7.0 0.8 0.8 0.1

Total operating costs and expenses $ 789.1 86.6 % $ 861.9 85.6 %

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(1) Represents the amount presented divided by total net revenue.

Cost of revenue

For the three months ended September 30, 2024, cost of revenue as a percentage of net revenue increased from the prior period, primarily due to (1) the impact of $27.3 million of contract termination costs and inventory charges related to product line lifecycle management, primarily in Sensing Solutions, and (2) the net impacts of customer pricing and manufacturing efficiencies, partially offset by (1) the impact of certain actions taken in the third quarter of 2023 as part of the Q3 2023 Plan and (2) the favorable effect of changes in foreign currency exchange rates.

Refer to Note 5:

Restructuring and Other Charges, Net of the Financial Statements, included elsewhere in this Report for additional information regarding the write-downs related

to product line lifecycle management.

Refer to Note 5:

Restructuring and Other Charges, Net of our 2023 Annual Report for additional information regarding the Q3 2023 Plan.

For the nine months ended September 30, 2024, cost of revenue as a percentage of net revenue increased from the prior period, primarily due to (1) the impact of $40.5 million of contract termination costs and inventory charges related to product line lifecycle management, primarily in Sensing Solutions, and (2) the net impacts of customer pricing and manufacturing efficiencies, partially offset by the nonrecurrence of a $10.5 million write-down of inventory in the three months ended June 30, 2023 as a result of our decision to exit the Spear Marine Business.

Refer to Note 5:

Restructuring and Other Charges, Net of the Financial Statements, included elsewhere in this Report for additional information regarding exit of the Spear Marine Business.

For the three months ended March 31, 2025, cost of revenue as a percentage of net revenue increased from the prior period, primarily due to (1) the unfavorable effect of changes in foreign currency exchange rates, (2) the net impacts of inflation on material and logistics costs and pricing recoveries from customers, and (3) unfavorable product mix.

Research and development expense

For the three and nine months ended September 30, 2024, research and development expense did not fluctuate materially from the prior year periods.

For the three months ended March 31, 2025, research and development expense did not fluctuate materially from the prior year period.

Selling, general and administrative expense

For the three months ended September 30, 2024, SG&A expense increased primarily due to costs and charges related to the sale of the Insights Business (including $5.8 million of accelerated vesting of restricted securities granted to employees of the Insights Business).

Refer to Note 16:

Disposal and Note 4:

Share-Based Payment Plans of the Financial Statements, included elsewhere in this Report, for additional information on the sale of the Insights Business and share-based compensation related to restricted securities, respectively.

For the nine months ended September 30, 2024, SG&A expense increased primarily due to (1) costs and charges related to the sale of the Insights Business (including accelerated vesting of restricted securities granted to employees of the Insights Business), (2) higher compensation costs, and (3) additional costs to remediate the material weaknesses identified in our internal controls over financial reporting for the year ended December 31, 2023, partially offset by cost savings as a result of actions taken as part of the Q3 2023 Plan.

For the three months ended March 31, 2025, SG&A expense did not fluctuate materially from the prior year period.

Amortization of intangible assets

For the three months ended September 30, 2024, amortization of intangible assets increased from the prior periods, primarily due to $9.6 million of accelerated amortization related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024.

For the nine months ended September 30, 2024, amortization of intangible assets decreased from the prior periods, primarily due to (1) the non-recurrence of a $13.5 million charge for accelerated amortization of intangible assets in the nine months ended September 30, 2023 as a result of our exit from the Spear Marine Business and (2) the effect of amortization of intangible assets in accordance with their expected economic benefit, which generally results in acceleration of amortization expense in the early years of the life of an intangible asset, partially offset by $9.6 million of accelerated amortization related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024.

Goodwill impairment charge

In the third quarter of 2024, we recorded a $150.1 million non-cash impairment charge for our Dynapower reporting unit within the Sensing Solutions segment.

The primary indicator of impairment was revised projections of future cash flows that were lower than previous projections, including future cash flows that were delayed beyond management's initial expectations.

Refer to Note 13:

Fair Value Measures of the Financial Statements, included elsewhere in this Report, for additional information

For the three months ended March 31, 2025, amortization of intangible assets decreased from the prior period, primarily due to the divestiture of the Insights Business, resulting in approximately $9.8 million lower amortization expense during fiscal year 2025, and the effect of amortization of intangible assets in accordance with their expected economic benefit, which generally results in acceleration of amortization expense in the early years of the life of an intangible asset.

Restructuring and other charges, net

In the three months ended September 30, 2024, restructuring and other charges, net increased from the prior year period, primarily due to (1) the loss on the sale of the Insights Business in the third quarter of 2024 and (2) charges related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, partially offset by the nonrecurrence of severance charges incurred in the third quarter of 2023 related to the Q3 2023 Plan.

In the nine months ended September 30, 2024, restructuring and other charges, net increased from the prior year period, primarily due to (1) the loss on the sale of the Insights Business in the third quarter of 2024, (2) charges related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, and (3) contract termination costs related to certain product lifecycle management activities, primarily within Sensing Solutions, partially offset by (1) the nonrecurrence of severance charges incurred in the third quarter of 2023 related to the Q3 2023 Plan, (2) the non-recurrence of charges incurred

in the second quarter of 2023 related to our decision to exit the Spear Marine Business, and (3) lower acquisition-related deferred compensation .

In the three months ended March 31, 2025, restructuring and other charges, net increased from the prior year period, primarily due to the loss on the sale of the Magnetic Speed and Positioning business and charges associated with the 2H 2024 Plan.

Refer to Note 5:

Restructuring and Other Charges, Net of the Financial Statements, included elsewhere in this Report, for additional information regarding the components of restructuring and other charges, net.

Operating loss/income

For the three months ended September 30, 2024, operating loss was $199.2 million, compared to operating income of $116.3 million in the prior period.

This unfavorable impact was driven primarily by (1) a $150.1 million goodwill impairment charge related to the Dynapower business, (2) the loss on the sale of the Insights Business in the third quarter of 2024, (3) the impact of $27.3 million of contract termination costs and inventory charges related to product line discontinuations, primarily in Sensing Solutions, (4) charges related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, and (5) costs and charges related to the sale of the Insights Business (including accelerated vesting of restricted securities granted to employees of the Insights Business), partially offset by the nonrecurrence of severance charges incurred in the third quarter of 2023 related to the Q3 2023 Plan.

For the nine months ended September 30, 2024, operating income decreased from the prior year period, primarily due to (1) a $150.1 million goodwill impairment charge related to the Dynapower business, (2) the loss on the sale of the Insights Business in the third quarter of 2024, (3) the impact of $40.5 million of contract termination costs and inventory charges related to product line discontinuations, primarily in Sensing Solutions, (4) charges related to our decision to exit the Spear aerospace and defense business in the third quarter of 2024, (5) costs and charges related to the sale of the Insights Business (including accelerated vesting of restricted securities granted to employees of the Insights Business), and (6) higher compensation costs, partially offset by (1) the non-recurrence of charges incurred in the second quarter of 2023 related to our decision to exit the Spear Marine Business, (2) the nonrecurrence of severance charges incurred in the third quarter of 2023 related to the Q3 2023 Plan, and (3) cost savings as a result of actions taken as part of the Q3 2023 Plan.

Restructuring and Other Charges, Net and Note 16:

Disposals of the Financial Statements, included elsewhere in this Report, for additional information regarding the components of restructuring and other charges, net.

Operating income

For the three months ended March 31, 2025, operating income was $122.2 million, compared to $144.8 million in the prior period.

This unfavorable impact was driven primarily by (1) the impact of organic revenue declines and manufacturing efficiencies, (2) the disposition of the Insights business in the third quarter of 2024, and (3) the unfavorable impact of foreign exchange rates, partially offset by (1) a $17.9 million decrease in amortization of intangibles and (2) cost savings as a result of actions taken as part of the 2H 2024 and Q3 2023 Plans.

Interest expense

For the three months ended September 30, 2024, interest expense decreased from the prior periods, primarily due to lower interest expense on (1) the 5.0% Senior Notes, which were redeemed in July 2024, and (2) the 5.625% Senior Notes, which were redeemed in the fourth quarter of 2023, partially offset by higher interest expense related to the 6.625% Senior Notes, which were issued in June 2024.

For the nine months ended September 30, 2024, interest expense decreased from the prior periods, primarily due to lower interest expense on (1) the 5.625% Senior Notes, (2) the 5.0% Senior Notes, and (3) the Term Loan, which was paid in full in the second quarter of 2023, partially offset by higher interest expense related to the 6.625% Senior Notes.

Refer to Note 10:

Debt of the Financial Statements, included elsewhere in this Report, and Note 14:

Debt of our Annual Report on Form 10-K for additional information regarding these debt transactions.

For the three months ended March 31, 2025, interest expense did not fluctuate materially from the prior year period.

Interest income

For the three and nine months ended September 30, 2024, interest income decreased from the prior periods, primarily due to lower average cash equivalent balances in the respective periods compared to the prior periods.

For the three months ended March 31, 2025, interest income did not fluctuate materially from the prior year period.

Other, net primarily includes currency remeasurement gains and losses on net monetary assets, gains and losses on foreign currency and commodity forward contracts not designated as hedging instruments, mark-to-market gains and losses on investments, losses related to debt refinancing, and the portion of our net periodic benefit cost excluding service cost.

For the three months ended September 30, 2024, other, net represented a net loss of $12.3 million, an unfavorable impact on earnings of $13.6 million compared to a net gain of $1.3 million in the prior period.

This unfavorable impact was primarily due to the loss on the redemption of the 5.0% Senior Notes.

For the nine months ended September 30, 2024, other, net represented a net loss of $19.7 million, an unfavorable impact on earnings of $11.5 million compared to a net loss of $8.2 million in the prior period.

This unfavorable impact was primarily due to (1) a loss of $14.8 million recognized in the first quarter of 2024 as a result of observable price changes related to an equity investment held using the measurement alternative, (2) the loss on the redemption of the 5.0% Senior Notes, and (3) losses on foreign currency forward contracts that are not designated as accounting hedges, partially offset by (1) gains on foreign

currency remeasurement of net monetary assets and (2) gains on commodity forward contracts that are not designated as accounting hedges.

For the three months ended March 31, 2025, other, net represented a net gain of $2.1 million, a favorable impact on earnings of $13.7 million compared to a net loss of $11.5 million in the prior period.

This favorable impact was primarily due to the gain on commodity forward contracts and the absence of a $14.8 million loss recognized in the first quarter of 2024 as a result of observable price changes related to an equity investment held using the measurement alternative.

Refer to Note 13:

1 unchanged sentence

Other, Net of the Financial Statements, included elsewhere in this Report, for additional details of our hedge accounting contracts and the components of other, net, respectively.

(Benefit from)/provision for income taxes

The (benefit from)/provision for income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings;

and (2) deferred tax expense (or benefit), which represents adjustments in book-to-tax basis differences primarily related to (a) book versus tax basis in intangible assets, (b) changes in net operating loss carryforwards, and (c) changes in withholding taxes on unremitted earnings.

Other items impacting deferred tax expense include changes in tax rates, changes in our assessment of the realizability of our deferred tax assets, and other items as discussed below.

For the three and nine months ended September 30, 2024, the (benefit from)/provision for income taxes was impacted by (1) a deferred tax benefit of approximately $257.7 million due to a tax strategy to secure the future tax deductibility of certain Intellectual property which had a valuation allowance against it at December 31, 2023;

(2) a $12.8 million tax expense on the sale of the Insights Business;

and (3) deferred tax expense of $11.1 million on the settlement of the U.S.

qualified pension plan.

Provision for income taxes

The provision for income taxes consists of (1) current tax expense, which relates primarily to our profitable operations in tax jurisdictions with limited or no net operating loss carryforwards and withholding taxes related to management fees, royalties, and the repatriation of foreign earnings;

and (2) deferred tax expense (or benefit), which represents adjustments in book-to-tax basis differences primarily related to (a) book versus tax basis in intangible assets, (b) changes in net operating loss carryforwards and tax credits, and (c) changes in withholding taxes on unremitted earnings.

Non-GAAP Financial Measures

6 unchanged sentences

Organic revenue growth (or decline) is defined as the reported percentage change in net revenue calculated in accordance with U.S.

GAAP, excluding the period-over-period impact of foreign currency exchange rate differences as well as the net impact of material acquisitions and divestitures for the 12-month period following the respective transaction date(s).

GAAP, excluding the period-over-period impact of foreign exchange rate differences as well as the net impact of material acquisitions and divestitures and product life-cycle management for the 12-month period following the respective transaction date(s).

We believe that organic revenue growth (or decline) provides investors with helpful information with respect to our operating performance, and we use organic revenue growth (or decline) to evaluate our ongoing operations as well as for internal planning and forecasting purposes.

7 unchanged sentences

GAAP, adjusted to exclude certain non-GAAP adjustments which are described under the heading Non-GAAP Adjustments below.

Adjusted operating margin is calculated by dividing adjusted operating income (or loss) by net revenue determined in accordance with

Adjusted operating margin is calculated by dividing adjusted operating income (or loss) by net revenue determined in accordance with U.S.

We define adjusted net income as follows:

1 unchanged sentence

GAAP, excluding certain non-GAAP adjustments which are described under the heading Non-GAAP Adjustments below.

Adjusted EPS is calculated by dividing adjusted net income by the number of diluted weighted-average ordinary shares outstanding in the period.

We may also refer to certain of these measures, or changes in these measures, on a constant currency basis.

Adjusted operating margin calculated on a constant currency basis is determined by stating revenues and expenses at prior period foreign currency exchange rates and excludes the impact of foreign currency exchange rates on all hedges.

Adjusted EPS on a constant currency basis is determined in the same manner as adjusted operating margin, but also excludes the change in gain or loss on the remeasurement of monetary assets and liabilities.

Adjusted EPS is calculated by dividing adjusted net income by the number of diluted weighted-average ordinary shares outstanding in the period as determined in accordance with U.S.

Management uses adjusted operating income, adjusted operating margin, adjusted net income, and adjusted EPS (and the constant currency equivalent of each) as measures of operating performance, for planning purposes (including the preparation of our annual operating budget), to allocate resources to enhance the financial performance of our business, to evaluate the effectiveness of our business strategies, in communications with our Board of Directors and investors concerning our financial performance, and as factors in determining compensation for certain employees.

10 unchanged sentences

Adjusted EBITDA is defined as net income (or loss), determined in accordance with U.S.

GAAP, excluding interest expense, net, provision for (or benefit from) income taxes, depreciation expense, amortization of intangible assets, and the following non-GAAP adjustments, if applicable:

(1) restructuring related and other, (2) financing and other transaction costs, and (3) deferred loss or gain on derivative instruments.

GAAP, excluding interest expense, interest income, and provision for (or benefit from) income taxes, depreciation expense, amortization of intangible assets, and the following non-GAAP adjustments, if applicable:

(1) restructuring related and other, (2) financing and other transaction costs, and (3) other, net activities.

Refer to Non-GAAP Adjustments below for additional discussion of these adjustments.

We believe that this measure is useful to investors and management in understanding our ongoing operations and in analysis of ongoing operating trends.

Gross leverage ratio

7 unchanged sentences

These initiatives have been modified from time to time to reflect changes in overall market conditions and the competitive environment facing our business.

These initiatives include, among other items, acquisitions, divestitures, restructurings of certain business, supply chain or corporate activities, and various

financing transactions.

These initiatives include, among other items, acquisitions, divestitures, restructurings of certain business, supply chain or corporate activities, and various financing transactions.

We describe these adjustments in more detail below, each of which is net of current tax impacts, as applicable.

• Restructuring related and other :

includes net charges related to certain restructuring and other exit activities as well as other costs (or income) that we believe are either unique or unusual to the identified reporting period, and that we believe impact comparisons to prior period operating results.

includes net charges related to certain restructuring and other exit activities, other costs (or income) that we believe are either unique or unusual to the identified reporting period, and the impact of

commodity forward contacts that we believe impact comparisons to prior period operating results.

Such costs include charges related to optimization of our manufacturing processes to increase productivity.

This type of activity occurs periodically, however each action is unique, discrete, and driven by various facts and circumstances.

This type of activity occurs periodically;

however, each action is unique, discrete, and driven by various facts and circumstances.

Such amounts are excluded from internal financial statements and analyses that management uses in connection with financial planning and in its review and assessment of our operating and financial performance, including the performance of our segments.

• Financing and other transaction costs :

includes losses or gains related to debt financing transactions, losses or gains related to the divestiture of a business, costs incurred, including for legal, accounting, and other professional services, that are directly related to an acquisition, divestiture, or equity financing transaction, mark-to-market losses or gains on our equity investments, expenses related to compensation arrangements entered into concurrent with the closing of an acquisition, and adjustments related to changes in the fair value of acquisition-related contingent consideration amounts.

• Deferred loss or gain on derivative instruments :

includes unrealized losses or gains on derivative instruments that do not qualify for hedge accounting as well as the impact of commodity prices on our raw material costs relative to the strike price on our commodity forward contracts.

• Step-up depreciation and amortization :

includes depreciation expense associated with the step-up in fair value of assets acquired in connection with a business combination (e.g., property, plant and equipment and inventories) and amortization of intangible assets.

These exclusions are made to allow for comparison to prior period operating results and to ensure that internal financial statements reflect depreciation and amortization on ordinary capital expenditures, rather than acquisition-related adjustments.

includes costs incurred, such as legal, accounting, and other professional services, that are directly related to an acquisition, divestiture, or equity financing transaction, expenses related to compensation arrangements entered into concurrent with the closing of an acquisition, adjustments related to changes in the fair value of acquisition-related contingent consideration amounts, and historical adjustments to exclude step-up depreciation in our non-GAAP measures.

Beginning with the three months ended December 31, 2024, we discontinued the use of adjustments to exclude step-up depreciation in our non-GAAP measures.

Prior periods have not been recast.

• Amortization of intangible assets :

includes amortization of intangible assets.

Beginning with the three months ended December 31, 2024, we started adjusting operating income and net income to exclude the amortization of all our intangible assets.

Prior periods have not been recast.

• Other, net:

includes expenses (or income) recorded within Other, net on our condensed consolidated statements of operations.

Beginning with the three months ended March 31, 2025, we started adjusting net income to exclude the impacts of these losses (or gains).

Prior periods have been recast.

Refer to Note 6:

Other, Net of the Financial Statements, included elsewhere in this Quarterly Report, for additional details of the components of Other, net.

• Deferred taxes and other tax related :

includes adjustments for book-to-tax basis differences due primarily to the step-up in fair value of fixed and intangible assets and goodwill, the utilization of net operating losses, and adjustments to our valuation allowance in connection with certain transactions and tax law changes.

includes adjustments for deferred taxes and other timing differences including, but not limited to, book-to-tax basis differences on the fair value of intangible assets and goodwill, the utilization of net operating losses, and adjustments to our valuation allowance in connection with certain transactions and tax law changes.

Other tax related items include certain adjustments to unrecognized tax benefits and withholding tax on repatriation of foreign earnings.

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The following tables present reconciliations of certain financial measures calculated in accordance with U.S.

GAAP to the related non-GAAP financial measures for the three months ended September 30, 2024 and 2023.

GAAP to the related non-GAAP financial measures for the three months ended March 31, 2025 and 2024.

Refer to the Non-GAAP Adjustments section above for additional information regarding these adjustments.

Amounts and percentages in the tables below have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the three months ended September 30, 2024

(Dollars in millions, except per share amounts) Operating (Loss)/Income Operating Margin Income Taxes Net (Loss)/Income Diluted EPS

Reported (GAAP) $ (199.2) (20.3) % $ (219.6) $ (25.0) $ (0.17)

Non-GAAP adjustments:

Restructuring related and other (a)

210.2 21.4 (0.9) 209.3 1.39

Financing and other transaction costs (b)

131.9 13.4 (0.5) 139.5 0.92

Step-up depreciation and amortization 43.8 4.5 — 43.8 0.29

Deferred loss on derivative instruments 1.7 0.2 (0.1) 0.4 0.00

Amortization of debt issuance costs — — — 1.3 0.01

Deferred taxes and other tax related — — (239.2) (239.2) (1.58)

Total adjustments 387.6 39.4 (240.7) 155.1 1.03

Adjusted (non-GAAP) $ 188.4 19.2 % $ 21.1 $ 130.1 $ 0.86

For the three months ended September 30, 2023

For the three months ended March 31, 2025

(Dollars in millions, except per share amounts) Operating Income Operating Margin Income Taxes Net Income Diluted EPS

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5.4 0.6 — 5.4 0.04

Step-up depreciation and amortization 38.8 3.9 — 38.8 0.25

Deferred gain on derivative instruments (0.7) (0.1) 0.0 (0.1) 0.00

Amortization of debt issuance costs — — — 1.7 0.01

Deferred taxes and other tax related — — (1.1) (1.1) (0.01)

Total adjustments 75.4 7.5 (2.4) 75.5 0.50

Adjusted (non-GAAP) $ 191.6 19.1 % $ 20.3 $ 138.3 $ 0.91

The following tables present reconciliations of certain financial measures calculated in accordance with U.S.

GAAP to the related non-GAAP financial measures for the nine months ended September 30, 2024 and 2023.

For the nine months ended September 30, 2024

(Dollars in millions, except per share amounts) Operating Income Operating Margin Income Taxes Net Income Diluted EPS

Reported (GAAP) $ 75.5 2.5 % $ (169.7) $ 122.7 $ 0.81

Non-GAAP adjustments:

Restructuring related and other (a)

239.4 7.9 (2.2) 237.1 1.57

Financing and other transaction costs (b)

Amortization of intangible assets (c)

20.6 2.3 — 20.6 0.14

Step-up depreciation and amortization 118.7 3.9 — 118.7 0.79

Deferred loss/(gain) on derivative instruments 1.3 0.0 1.6 (4.4) (0.03)

Amortization of debt issuance costs — — — 1.2 0.01

— — (0.5) (2.6) (0.02)

Deferred taxes and other tax related

— — 2.2 2.2 0.02

Total adjustments 44.3 4.9 3.3 46.7 0.31

Adjusted (non-GAAP) $ 166.5 18.3 % $ 17.4 $ 116.6 $ 0.78

For the nine months ended September 30, 2023

For the three months ended March 31, 2024

(Dollars in millions, except per share amounts) Operating Income Operating Margin Income Taxes Net Income Diluted EPS

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4.6 0.5 (0.2) 4.4 0.03

Step-up depreciation and amortization 131.3 4.3 — 131.3 0.86

Deferred (gain)/loss on derivative instruments (3.9) (0.1) (0.2) 0.8 0.01

Amortization of intangible assets (c)

37.1 3.7 — 37.1 0.25

Amortization of debt issuance costs — — — 1.6 0.01

— — 0.4 12.0 0.08

Deferred taxes and other tax related — — 1.3 1.3 0.01

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Adjusted (non-GAAP) $ 188.5 18.7 % $ 21.5 $ 134.0 $ 0.89

(a) The following table presents the components of our restructuring related and other non-GAAP adjustment to net income for the three and nine months ended September 30, 2024 and 2023.

(amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended September 30, For the nine months ended September 30,

(a) The following table presents the components of our restructuring related and other non-GAAP adjustment to net income for the three months ended March 31, 2025 and 2024 (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended March 31,

(In millions) 2025 2024

Business and corporate repositioning (i)

$ 60.1 $ 30.7 $ 89.3 $ 66.0

150.1 0.8 150.1 (0.8)

Income tax effect (iii)

(0.9) (1.4) (2.2) (2.7)

Total non-GAAP restructuring related and other (iv)

$ 209.3 $ 30.2 $ 237.1 $ 62.9

Income tax effect (ii)

Total non-GAAP restructuring related and other (iii)

__________________________

Primarily includes charges related to repositioning our business and corporate functions to more effectively respond to the challenges that face the business.

The three and nine months ended September 30, 2024 primarily includes (1) certain actions related to restructuring of our IT operations and product lifecycle management including product line discontinuations within the Sensing Solutions segment, resulting in total costs of $ 32.5 million and $ 48.4 million, respectively, including severance, contract termination costs, and charges related to asset write-downs, (2) approximately $5.3 million and $19.9 million, respectively, of other various restructuring-related charges, (3) approximately $15.0 million in both periods of costs associated with exiting Spear, primarily recorded in restructuring and other charges, net, and (4) a $6.0 million pension settlement charge in both periods, recorded in restructuring and other charges, net.

The three and nine months ended September 30, 2023 primarily includes (1) $1.8 million and $28.4 million, respectively, of charges related to the exit the Spear Marine Business, $0.8 million and $14.4 million of which was recorded in restructuring and other charges, net, and $0.5 million and $13.0 million of which was recorded in cost of revenue, with the remainder recorded in selling general and administrative, (2) $21.4 million of charges incurred in both the three and nine months ended September 30, 2023, as part of the Q3 2023 Plan, recorded in restructuring and other charges, net, and (3) $8.2 million and $10.4 million of charges arising as an indirect result of actions taken in the Q3 2023 Plan, of which approximately $0.7 million and $2.7 million were recorded in restructuring and other charges, net, with the remainder primarily in cost of revenue.

Relates primarily to a $ 150.1 million non-cash goodwill impairment charge recognized in the third quarter of 2024 related to the Dynapower reporting unit.

Also includes costs related to optimization of our manufacturing processes to increase productivity and rationalize our manufacturing footprint and supply chain workforce rationalization and charges incurred related to legal matters associated with acquired businesses, for which new information is brought to light after the measurement period for the business combination is closed, but for which the liability relates to events or activities that occurred prior to our acquisition of the business.

Primarily includes charges related to repositioning our business and corporate functions to more effectively respond to the challenges that face the business, including severance, contract termination costs, charges related to asset write-downs, and other various restructuring-related charges.

We treat deferred taxes as a non-GAAP adjustment.

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Certain portions of these adjustments are non-operating and are excluded from the non-GAAP adjustments to operating income.

(b) The following table presents the components of our financing and other transaction costs non-GAAP adjustment to net income for the three and nine months ended September 30, 2024 and 2023.

(amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended September 30, For the nine months ended September 30,

(b) The following table presents the components of our financing and other transaction costs non-GAAP adjustment to net income for the three months ended March 31, 2025 and 2024 (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

For the three months ended March 31,

(In millions) 2025 2024

Transaction (gain) / loss (i)

$ 123.4 $ 1.5 $ 126.2 (3.0)

Transaction loss (i)

Merger and acquisition compensation arrangements (ii)

8.5 4.2 12.6 16.2

Loss on debt financing (iii)

9.2 — 9.2 0.9

Loss/(gain) on investments (iv)

(1.1) 0.4 13.2 0.7

Income tax effect (v)

(0.5) — (1.4) 2.8

Total financing and other transaction costs (vi)

$ 139.5 $ 6.0 $ 159.8 $ 17.6

Acquisition-related depreciation

Income tax effect (iii)

Total financing and other transaction costs (iv)

__________________________

Primarily includes losses or gains related to the divestiture of a business, costs incurred, including for legal, accounting, and other professional services, that are directly related to an acquisition, divestiture, or other transaction.

In the three and nine months ended September 30, 2024, this line includes a loss of $ 110.1 million on the sale of the Insights business.

Refer to Note 16:

Disposal for further information on this transaction.

Primarily relates to earnout compensation arrangements entered into concurrent with the closing of an acquisition.

Relates primarily to the loss on the redemption of the 5.0 % Senior Notes.

In the three months ended March 31, 2025, this line includes costs and losses associated with the disposition of the Magnetic Speed and Positioning ("MSP") Business.

Refer to Note 16:

Deb t for additional information on financing transactions.

Represents mark-to-market losses or gains on our equity investments

Disposals for further information on this transaction.

Primarily relates to earnout compensation arrangements entered into concurrent with the closing of an acquisition and compensation in connection with the closing of a transaction.

We treat deferred taxes as a non-GAAP adjustment.

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Certain portions of these adjustments are non-operating and are excluded from the non-GAAP adjustments to operating income.

(c) In the three months ended December 31, 2024, we discontinued the use of adjustments to exclude step-up depreciation in our non-GAAP measures and we adjusted operating income and net income to exclude the amortization of all our intangible assets.

The three months ended March 31, 2024 have not been recast.

If we had recast this non-GAAP measure for the three months ended March 31, 2024, adjusted operating income and adjusted net income would have increased by an additional $1.1 million.

The following table provides a reconciliation of net cash provided by operating activities in accordance with U.S.

GAAP to free cash flow.

For the nine months ended September 30,

For the three months ended March 31,

(In millions) 2025 2024

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GAAP to adjusted corporate and other expenses.

For the three months ended September 30, For the nine months ended September 30,

For the three months ended March 31,

(In millions) 2025 2024

2 unchanged sentences

Financing and other transaction costs 1.0 3.6

Step-up depreciation and amortization 0.2 0.4 0.8 0.7

Deferred loss/(gain) on derivative instruments 1.7 (0.7) 1.3 (3.9)

Total adjustments 16.8 5.8

Adjusted corporate and other expenses (non-GAAP) $ (52.4) $ (58.1)

The following table provides a reconciliation of net (loss)/income in accordance with U.S.

The following table provides a reconciliation of net income in accordance with U.S.

GAAP to adjusted EBITDA.

For the three months ended September 30, For the nine months ended September 30,

For the three months ended March 31,

(In millions) LTM 2025 2024

Net (loss)/income $ (79.5) $ (25.0) $ 62.8 $ 122.7 $ 198.3

$ 122.4 $ 69.9 $ 76.0

Interest expense, net 138.6 33.7 34.7

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Financing and other transaction costs 134.2 5.4 4.4

Deferred (gain)/loss on derivative instruments (9.0) 0.5 (0.2) (6.0) 1.0

7.8 (2.1) 11.5

Adjusted EBITDA $ 859.8 $ 200.2 $ 223.2

1 unchanged sentence

GAAP to gross and net leverage ratios.

(Dollars in millions) September 30,

(Dollars in millions) March 31,

2025 December 31,

3 unchanged sentences

Total debt and finance lease obligations 3,200.0 3,199.5

debt premium, net of discount (debt discount, net of premium) 0.8 (1.6)

debt premium, net

deferred financing costs (23.7) (24.9)

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Liquidity and Capital Resources

As of September 30, 2024 and December 31, 2023, we held cash and cash equivalents in the following regions (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

(In millions) September 30,

As of March 31, 2025 and December 31, 2024, we held cash and cash equivalents in the following regions (amounts have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

(In millions) March 31,

2025 December 31,

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The amount of cash and cash equivalents held in these geographic regions fluctuates throughout the year due to a variety of factors, such as our use of intercompany loans and dividends and the timing of cash receipts and disbursements in the normal course of business.

Our earnings are not considered to be permanently reinvested in certain jurisdictions in which they were

Our earnings are not considered to be permanently reinvested in certain jurisdictions in which they were earned.

We recognize a deferred tax liability on these unremitted earnings to the extent the remittance of such earnings cannot be recovered in a tax-free manner.

3 unchanged sentences

Our cash and cash equivalents balances are held in the following significant currencies (amounts in the tables below have been calculated based on unrounded numbers, accordingly, certain amounts may not appear to recalculate due to the effect of rounding):

As of September 30, 2024

(In millions) USD EUR GBP CNY Other

As of March 31, 2025

(In millions) United States Dollar ("USD")

British Pound Sterling ("GBP")

Chinese Renminbi ("CNY")

United Kingdom $ 0.2 € 0.0 £ 4.6 ¥ —

14 unchanged sentences

USD Equivalent $ 10.1 $ 4.5 $ 199.2 $ 10.7

The table below summarizes our primary sources and uses of cash for the nine months ended September 30, 2024 and 2023.

The table below summarizes our primary sources and uses of cash for the three months ended March 31, 2025 and 2024.

We have derived these summarized statements of cash flows from the Financial Statements included elsewhere in this Report.

1 unchanged sentence

Accordingly, certain amounts may not appear to recalculate due to the effect of rounding.

For the nine months ended

(In millions) September 30, 2024 September 30, 2023

For the three months ended

(In millions) March 31, 2025 March 31, 2024

Net cash provided by/(used in):

3 unchanged sentences

Changes in operating assets and liabilities, net (22.7) (62.9)

Cash operating activities (5.2) (22.6)

Operating activities 119.2 106.5

4 unchanged sentences

Operating activities.

Net cash provided by operating activities for the nine months ended September 30, 2024 increased compared to the corresponding period of the prior year, primarily due to favorable changes in working capital, partially offset by lower cash provided by earnings.

Net cash provided by operating activities for the three months ended March 31, 2025 increased compared to the corresponding period of the prior year, primarily due to favorable changes in working capital, partially offset by lower cash provided by earnings.

Investing activities.

Net cash provided by investing activities for the nine months ended September 30, 2024 was $15.2 million compared to a use of cash of $117.6 million for the corresponding period of the prior year.

This change was primarily due to the proceeds from the sale of our Insights business of $138.3 million in the nine months ended September 30, 2024.

Net cash used in investing activities for the three months ended March 31, 2025 was $6.9 million compared to a use of cash of $42.1 million for the corresponding period of the prior year.

This change was primarily due to a reduction in capital expenditures and proceeds received from the sale of the MSP Business.

Refer to Note 16:

Disposals for additional information.

For fiscal year 2025, we anticipate capital expenditures of approximately $150.0 million, which we expect to fund with cash on hand.

Financing activities .

Net cash used in financing activities for the nine months ended September 30, 2024 decreased compared to the corresponding period of the prior year, primarily due to $500.0 million cash received from the issuance of the 6.625% Senior Notes in the second quarter of 2024, partially offset by higher payments on debt of approximately $252.2 million (reflecting the early redemption of our $700 million 5.0% Senior Notes in the third quarter of 2024 as compared to the prepayment of the Term Loan in the first half of 2023) and the payment of $79.4 million to repurchase the remaining equity interest in a former joint venture in the nine months ended September 30, 2024.

Net cash used in financing activities for the three months ended March 31, 2025 increased compared to the corresponding period of the prior year, primarily due to an increase in the amount of cash paid to repurchase ordinary shares, partially offset by the payment of $79.4 million to repurchase the remaining equity interest in a joint venture in the prior year.

Refer to Note 12:

1 unchanged sentence

Indebtedness and Liquidity

As of September 30, 2024, we had $3.2 billion in gross indebtedness, which includes finance lease obligations and excludes debt discounts, premiums, and deferred financing costs.

In June 2024, our indirect, wholly-owned subsidiary, STI, completed the issuance and sale of the 6.625% Senior Notes.

In July 2024, we used the proceeds from this issuance, together with cash on hand, for the redemption in full of the 5.0% Senior Notes, which were issued by our indirect, wholly-owned subsidiary, STBV.

Refer to Note 10:

Debt of the Financial Statements included elsewhere in this Report for additional information on these transactions and our overall debt.

As of March 31, 2025, we had $3.2 billion in gross indebtedness, which includes finance lease obligations and excludes debt discounts, premiums, and deferred financing costs.

Capital Resources

Senior Secured Credit Facilities

The credit agreement governing our secured credit facility (as amended, supplemented, waived, or otherwise modified, the "Credit Agreement") provides for the Senior Secured Credit Facilities, which consist of the Term Loan, the Revolving Credit Facility, and incremental availability (the "Accordion") under which additional secured credit facilities could be issued under certain circumstances.

In the first and second quarters of 2023, we repaid the Term Loan balance in full.

Sources of liquidity

Our sources of liquidity include cash on hand, cash flows from operations, and available capacity under the Revolving Credit Facility.

As of September 30, 2024, we had $745.8 million available under the Revolving Credit Facility, net of $4.2 million of obligations in respect of outstanding letters of credit issued thereunder.

As of March 31, 2025, we had $745.8 million available under the Revolving Credit Facility, net of $4.2 million of obligations in respect of outstanding letters of credit issued thereunder.

Outstanding letters of credit are issued primarily for the benefit of certain operating activities.

As of September 30, 2024, no amounts had been drawn against these outstanding letters of credit.

Availability under the Accordion varies each period based on our attainment of certain financial metrics as set forth in the terms of the Credit Agreement and the indentures under which our senior notes were issued (the "Senior Notes Indentures").

As of September 30, 2024, availability under the Accordion was approximately $2.8 billion.

We believe, based on our current level of operations and taking into consideration the restrictions and covenants included in the Credit Agreement and Senior Notes Indentures, that the sources of liquidity described above will be sufficient to fund our operations, capital expenditures, dividend payments, ordinary share repurchases, and debt service for at least the next twelve months.

As of March 31, 2025, no amounts had been drawn against these outstanding letters of credit.

This Revolving Credit Facility includes an accordion feature under which maximum borrowings may be increased under certain circumstances.

We believe, based on our current level of operations and taking into consideration the restrictions and covenants included in the Credit Agreement, Revolving Credit Facility, and Senior Notes Indentures, that the sources of liquidity described above will be sufficient to fund our operations, capital expenditures, dividend payments, ordinary share repurchases, and debt service for at least the next twelve months.

However, we cannot make assurances that our business will generate sufficient cash flows from operations or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs.

1 unchanged sentence

Our ability to raise additional financing, and our borrowing costs, may be impacted by short and long term debt ratings assigned by independent rating agencies, which are based, in significant part, on our performance as measured by certain credit metrics such as interest coverage and leverage ratios.

As of October 18, 2024, Moody’s Investors Service’s corporate credit rating for STBV was Ba2 with a positive outlook, and Standard & Poor’s corporate credit rating for STBV was BB+ with a stable outlook.

As of April 25, 2025, Moody’s Investors Service’s corporate credit rating for STBV was Ba2 with a positive outlook, and Standard & Poor’s corporate credit rating for STBV was BB+ with a stable outlook.

Any future downgrades to STBV's credit ratings may increase our future borrowing costs but will not reduce availability under the Credit Agreement.

1 unchanged sentence

The Credit Agreement provides that if our senior secured net leverage ratio exceeds a specified level, we are required to use a portion of our excess cash flow, as defined in the Credit Agreement, generated by operating, investing, or financing activities to prepay some or all of the outstanding borrowings under the Senior Secured Credit Facilities.

The Credit Agreement also requires mandatory prepayments of the outstanding borrowings under the Senior Secured Credit Facilities upon certain asset

dispositions and casualty events, in each case subject to certain reinvestment rights, and upon the incurrence of certain indebtedness (excluding any permitted indebtedness).

These provisions were not triggered during the nine months ended September 30, 2024.

The Credit Agreement also requires mandatory prepayments of the outstanding borrowings under the Senior Secured Credit Facilities upon certain asset dispositions and casualty events, in each case subject to certain reinvestment rights, and upon the incurrence of certain indebtedness (excluding any permitted indebtedness).

These provisions were not triggered during the three months ended March 31, 2025.

The Credit Agreement and the Senior Notes Indentures contain restrictions and covenants that limit the ability of our wholly-owned subsidiary, STBV, and certain of its subsidiaries to, among other things, incur subsequent indebtedness, sell assets, pay dividends, and make other restricted payments.

2 unchanged sentences

These restrictions and covenants, which are subject to important exceptions and qualifications set forth in the Credit Agreement and Senior Notes Indentures, were taken into consideration when we established our share repurchase programs and will be evaluated periodically with respect to future potential funding of those programs.

As of September 30, 2024, we believe we were in compliance with all covenants and default provisions under our credit arrangements.

As of March 31, 2025, we believe we were in compliance with all covenants and default provisions under our credit arrangements.

Share repurchase programs

From time to time, our Board of Directors has authorized various share repurchase programs, which may be modified or terminated by our Board at any time.

We currently have authorization for the September 2023 Program, under which approximately $423.1 million remained available as of September 30, 2024.

In the nine months ended September 30, 2024, we repurchased 1.3 million ordinary shares under the September 2023 Program.

In the nine months ended September 30, 2023, we repurchased 1.5 million ordinary shares under the January 2022 Program

In the nine months ended September 30, 2024 and 2023, we paid aggregate cash dividends of $54.3 million and $53.4 million, respectively.

On October 28, 2024, we announced that our Board of Directors approved a quarterly dividend of $0.12 per share, payable on November 27, 2024 to shareholders of record as of November 13, 2024.

Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures , to improve disclosures about a public entity's reportable segments.

This guidance requires that a public entity disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss and an amount for "other segment items" included in the determination of segment operating income.

The guidance also requires that a public entity provide all annual disclosures about a reportable segment's profit or loss and assets currently required by FASB ASC Topic 280, Segment Reporting , in interim periods, and that a public entity provide the title and position of the chief operating decision maker.

There is no change to the guidance for identification or aggregation of operating or reportable segments.

Other requirements of the guidance are not expected to be material.

2023-07 will be effective for annual periods beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

The guidance will be applied retrospectively to all prior periods presented.

We adopted the guidance in FASB ASU No.

2023-07 on January 1, 2024 and will include the required new annual and quarterly disclosures in our Annual Report on Form 10-K for the period ended December 31, 2024 and our Quarterly Report on Form 10-Q for the three months ended March 31, 2025, respectively.

In December 2023, the FASB issued ASU No.

2023-09, Income taxes (Topic 740):

Improvements to Income Tax Disclosures , to improve the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction.

The guidance also includes certain other amendments to improve the effectiveness of income tax disclosures.

For public business entities, the standard is effective for annual periods beginning after December 15, 2024.

We do not expect the adoption of FASB ASU No.

2023-09 to have an impact on our results of operations or financial condition, but it is expected to increase the amount of disclosures required in the notes to the consolidated financial statements.

We currently have authorization for the September 2023 Program, under which approximately $302.5 million remained available as of March 31, 2025.

In the three months ended March 31, 2025, and 2024, we repurchased 3.5 million and 0.3 million ordinary shares under the September 2023 Program.

In the three months ended March 31, 2025 and 2024, we paid aggregate cash dividends of $17.9 million and $18.1 million, respectively.

On April 21, 2025, we announced that our Board of Directors approved a quarterly dividend of $0.12 per share, payable on May 28, 2025 to shareholders of record as of May 14, 2025.

Critical Accounting Policies and Estimates

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It also requires that we make estimates and assumptions about future events that affect the amounts reported in the consolidated financial statements and accompanying notes.

No material changes to our critical accounting policies and estimates, as previously disclosed, have occurred during the first nine months of 2024.

No material changes to our critical accounting policies and estimates, as previously disclosed, have occurred during the first three months of 2025.

Quantitative and Qualitative Disclosures About Market Risk.

3 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis