What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-06 compared with 2024-11-05 · 76 added, 130 removed, 57 unchanged (78% of the section changed)

1 unchanged sentence

Our discussions below in this Item 2 are based upon the more detailed discussions about our business, operations and financial condition included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024, under Part II, Item 7 of that Form 10-K.

Our discussions here focus on our results during the quarter and nine months ended September 29, 2024, or as of, September 29, 2024, and the comparable periods of 2023, and to the extent applicable, any material changes from the information discussed in that Form 10-K or other important intervening developments or information since that time.

Our discussions here focus on our results during the quarter ended March 30, 2025, or as of, March 30, 2025, and the comparable periods of 2024, and to the extent applicable, any material changes from the information discussed in that Form 10-K or other important intervening developments or information since that time.

These discussions should be read in conjunction with that Form 10-K for more detailed and background information.

The nine-month periods ended September 29, 2024 and October 1, 2023 both include 39 weeks.

The three-month periods ended September 29, 2024 and October 1, 2023 both include 13 weeks.

The three-month periods ended March 30, 2025 and March 31, 2024 both include 13 weeks.

Forward-Looking Statements

This report contains statements which may constitute “forward-looking statements” within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995.

Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include risks and uncertainties associated with the economic conditions in the commercial interiors industry as well as the risks and uncertainties discussed under the heading “Risk Factors” included in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

Executive Overview

During the quarter ended September 29, 2024, we had consolidated net sales of $344.3 million, up 10.7% compared to $311.0 million in the third quarter last year, primarily due to higher customer demand — particularly in the retail and education market segments.

Consolidated operating income was $42.2 million for the third quarter of 2024 compared to $31.0 million in the third quarter last year, primarily due to higher sales and higher gross profit margin as a result of higher sales volume, raw material cost deflation, and favorable fixed cost absorption.

Consolidated net income for the quarter ended September 29, 2024, was $28.4 million or $0.48 per diluted share, compared to $9.9 million or $0.17 per diluted share in the third quarter last year.

During the first nine months of 2024, we had consolidated net sales of $980.6 million, up 4.7% compared to $936.4 million in the first nine months of last year, primarily due to higher customer demand — particularly in the education, retail, and residential living market segments partially offset by decreases in the healthcare and hospitality market segments.

Consolidated operating income was $104.8 million for the first nine months of 2024, compared to $69.4 million in the same period last year, primarily due to higher sales and higher gross profit margin as a result of higher average sales prices and raw material cost deflation.

Consolidated net income for the nine months ended September 29, 2024, was $65.2 million or $1.11 per diluted share, compared to $25.0 million or $0.43 per diluted share in the same period last year.

Cybersecurity Event

As previously disclosed in our current report on Form 8-K filed with the Commission on November 23, 2022, we discovered a cybersecurity attack on November 20, 2022, perpetrated by unauthorized third parties, affecting our IT systems.

The investigation of the Cyber Event was completed in fiscal year 2023.

We have cyber risk insurance and have recovered $0.5 million of our costs and expenses during the nine months ended September 29, 2024.

We anticipate that additional costs, expenses or losses related to the Cyber Event will ultimately be recovered by insurance.

During the quarter ended March 30, 2025, we had consolidated net sales of $297.4 million, up 2.6% compared to $289.7 million in the first quarter last year, primarily due to higher sales volume — particularly in the education, healthcare, and retail market segments.

Fluctuations in currency exchange rates negatively impacted net sales during the first quarter of 2025, as discussed below.

Consolidated operating income was $23.2 million for the first quarter of 2025, compared to $24.4 million in the first quarter last year, primarily due to lower gross profit margin as a result of higher manufacturing costs in EAAA and higher freight costs, partially offset by higher pricing.

Consolidated net income for the quarter ended March 30, 2025, was $13.0 million or $0.22 per diluted share, compared to consolidated net income of $14.2 million or $0.24 per diluted share, in the first quarter last year.

Impact of Macroeconomic Trends

Recent disruptions in economic markets due to inflation, high interest rates, the Russia-Ukraine war and the Israel-Hamas war, a fairly stabilized but still challenging supply chain environment, slow market conditions in certain parts of the globe, and significant financial pressures in the commercial office market globally, all pose challenges which may adversely affect our future performance .

To mitigate these impacts, we plan to continue evaluating our cost structure and global manufacturing footprint to identify and activate opportunities to decrease costs and optimize our global cost structure.

Disruptions in economic markets due to the potential impact of government-imposed tariffs and retaliatory tariffs, fluctuating freight costs, supply chain challenges and disruptions, significant pressures in the commercial office market globally, inflation, slow market conditions in certain parts of the globe, the Russia-Ukraine war and the conflict in the Middle East, all pose challenges which may adversely affect our future performance.

W e plan to continue evaluating our cost structure and global manufacturing footprint to identify and activate opportunities to decrease costs and optimize our global cost structure.

Analysis of Results of Operations

Consolidated Results

The following table presents, as a percentage of net sales, certain items included in our consolidated condensed statements of operations for the three-month and nine-month periods ended September 29, 2024 and October 1, 2023:

Three Months Ended Nine Months Ended

September 29, 2024 October 1, 2023 September 29, 2024 October 1, 2023

The following table presents, as a percentage of net sales, certain items included in our consolidated condensed statements of operations for the three-month periods ended March 30, 2025 and March 31, 2024:

Three Months Ended

March 30, 2025 March 31, 2024

Net sales 100.0 % 100.0 %

2 unchanged sentences

Selling, general and administrative expenses 29.5 29.7

Restructuring, asset impairment, and other gains, net

Operating income 7.8 8.4

Interest/Other expense, net

1.8 4.8 1.9 3.5

Income before income tax expense

Income tax expense 1.4 1.7

Net income 8.3 % 3.2 % 6.7 % 2.7 %

Consolidated Net Sales

Below is information regarding our consolidated net sales, and analysis of those results, for the three-month and nine-month periods ended September 29, 2024, and October 1, 2023:

Below is information regarding our consolidated net sales, and analysis of those results, for the three-month periods ended March 30, 2025, and March 31, 2024:

Three Months Ended Percentage

Change Nine Months Ended Percentage

September 29, 2024 October 1, 2023 September 29, 2024 October 1, 2023

(in thousands) (in thousands)

March 30, 2025 March 31, 2024

(in thousands)

Consolidated net sales $ 297,413 $ 289,743 2.6 %

For the quarter ended September 29, 2024, consolidated net sales increased $33.3 million (10.7%) versus the comparable period in 2023, primarily due to higher sales volume (approximately 9%) and higher average sales prices (approximately 2%).

Currency fluctuations had a positive impact on consolidated net sales of approximately $1.4 million (0.4%) for the third quarter of 2024, due primarily to the strengthening of the Euro, Australian dollar, and British Pound sterling against the U.S.

On a market segment basis, the sales increase was primarily in the retail, education, corporate office, residential living, and public buildings market segments partially offset by decreases in the hospitality and healthcare market segments.

For the nine months ended September 29, 2024, consolidated net sales increased $44.3 million (4.7%) versus the comparable period in 2023, primarily due to higher volume (approximately 3%) and higher average sales prices (approximately 2%).

Currency fluctuations had a negative impact on consolidated net sales of approximately $0.7 million (0.1%) for the first nine months of 2024, due to the weakening of the Chinese Renminbi, Canadian dollar, and Australian dollar against the U.S.

dollar partially offset by the strengthening of the British Pound sterling against the U.S.

On a market segment basis, the sales increase was primarily in the education, retail, residential living, and public buildings market segments partially offset by decreases in the healthcare and hospitality market segments.

For the quarter ended March 30, 2025, consolidated net sales increased $7.7 million (2.6%) versus the comparable period in 2024, primarily due to higher sales volumes (approximately 3%).

Currency fluctuations had a negative impact on net sales of approximately $4.3 million (1.5%) for the first quarter of 2025, compared to the same period last year, primarily due to the weakening of the Euro, Australian dollar, and Canadian dollar against the U.S.

On a market segment basis, the sales increase was primarily in the education, retail, and healthcare market segments partially offset by lower sales in the corporate office market segment.

Consolidated Cost and Expenses

The following table presents our consolidated cost of sales and selling, general and administrative expenses for the three-month and nine-month periods ended September 29, 2024, and October 1, 2023:

The following table presents our consolidated cost of sales and selling, general and administrative expenses for the three-month periods ended March 30, 2025, and March 31, 2024:

Three Months Ended Percentage

Change Nine Months Ended Percentage

September 29, 2024 October 1, 2023 September 29, 2024 October 1, 2023

(in thousands) (in thousands)

March 30, 2025 March 31, 2024

(in thousands)

Consolidated cost of sales

$ 186,450 $ 179,338 4.0 %

Consolidated selling, general and administrative expenses

87,736 85,959 2.1 %

Consolidated Cost of Sales

For the quarter ended September 29, 2024, consolidated cost of sales increased $15.9 million (7.9%) compared to the third quarter of 2023, primarily due to higher sales partially offset by raw material cost deflation and favorable fixed cost absorption.

Currency translation had a negative impact on consolidated cost of sales in the third quarter of 2024 and partially increased our costs by approximately $0.9 million (0.4%) compared to the same period last year.

As a percentage of net sales, our cost of sales decreased to 62.9% for the third quarter of 2024 versus 64.5% for the third quarter of 2023.

For the nine months ended September 29, 2024, consolidated cost of sales increased $1.5 million (0.2%) versus the comparable period in 2023, primarily due to higher sales partially offset by raw material cost deflation.

Currency translation had a positive impact on consolidated cost of sales for the first nine months of 2024 and partially reduced our costs by approximately $0.6 million (0.1%) compared to the same period last year.

As a percentage of net sales, our cost of sales decreased to 63.2% for the first nine months of 2024 versus 66.0% for the first nine months of 2023.

Consolidated Gross Profit

For the quarter ended September 29, 2024, gross profit, as a percentage of net sales, was 37.1% compared with 35.5% in the same period last year.

The increase in gross profit percentage was primarily due to lower costs (approximately 2%) driven by raw material cost deflation and lower fixed costs per unit due to higher volume.

For the nine months ended September 29, 2024, gross profit, as a percentage of net sales, was 36.8% compared with 34.0% in the same period last year.

The increase in gross profit percentage was primarily due to raw material cost deflation (approximately 2%) and higher average sales prices (approximately 1%).

For the quarter ended March 30, 2025, consolidated cost of sales increased $7.1 million (4.0%) compared to the first quarter of 2024, primarily due to higher sales and higher manufacturing and freight costs due to inflation.

Currency fluctuations had a positive impact on consolidated cost of sales for the first quarter of 2025, and partially reduced our costs by approximately $2.9 million (1.6%) compared to the same period last year.

As a percentage of net sales, our cost of sales increased to 62.7% for the first quarter of 2025 versus 61.9% for the first quarter of 2024.

Consolidated Selling, General and Administrative (“SG&A”) Expenses

For the quarter ended September 29, 2024, consolidated SG&A expenses increased $6.2 million (7.8%) versus the comparable period in 2023.

Currency fluctuations had no material impact on consolidated SG&A expenses in the third quarter of 2024 compared to the same period last year.

SG&A expenses were higher for the third quarter of 2024 primarily due to higher people costs of $5.7 million driven by increased variable compensation as a result of higher operating income compared to the same period last year.

As a percentage of net sales, SG&A expenses decreased to 24.8% for the third quarter of 2024 versus 25.5% for the third quarter of 2023.

For the nine months ended September 29, 2024, consolidated SG&A expenses increased $4.8 million (1.9%) versus the comparable period in 2023.

Currency translation had no material impact on consolidated SG&A expenses in the first nine months of 2024 compared to the same period last year.

SG&A expenses were higher for the first nine months of 2024 primarily due to (i) higher people costs of $12.2 million driven by the factors discussed above for the current quarter, partially offset by (ii) lower professional fees of $3.6 million primarily due to lower non-recurring consulting expenses, (iii) lower severance costs of $2.8 million driven by employee headcount reduction and cost saving initiatives in the prior year period, and (iv) lower Cyber Event costs of $1.4 million due to completion of the investigation in the prior year.

As a percentage of net sales, SG&A expenses decreased to 26.1% for the first nine months of 2024 versus 26.8% for the first nine months of 2023.

Assets Disposed

During the second quarter of 2023, the Company completed the sale of its Thailand manufacturing facility and recognized a gain of $2.7 million.

See Note 14 entitled “Assets Disposed” of Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Other Expense, net

During the nine months ended September 29, 2024, the Company received insurance proceeds of approximately $2.4 million related to a property casualty loss that occurred in fiscal year 2023.

The insurance proceeds were recognized in other expense, net, in the consolidated condensed statements of operations.

During the quarter ended October 1, 2023, the Company substantially liquidated its foreign subsidiaries in Brazil and Russia and $6.2 million of cumulative translation adjustments were reclassified from accumulated other comprehensive loss and recognized in other expense, net, in the consolidated condensed statements of operations.

For the quarter ended March 30, 2025, consolidated SG&A expenses increased $1.8 million (2.1%) versus the comparable period in 2024.

Currency translation had no material impact on consolidated SG&A expenses in the first quarter of 2025 compared to the same period last year.

SG&A expenses were higher for the first quarter of 2025 primarily due to higher commissions as a result of higher sales compared to the same period last year.

As a percentage of net sales, SG&A expenses decreased to 29.5% for the first quarter of 2025 versus 29.7% for the first quarter of 2024.

Consolidated Gross Profit

For the quarter ended March 30, 2025, consolidated gross profit, as a percentage of net sales, was 37.3% compared with 38.1% in the same period last year.

The decrease in consolidated gross profit percentage was primarily due to higher costs (approximately 1%) driven by higher manufacturing costs in EAAA and higher freight costs, partially offset by higher pricing (approximately 0.4%).

Interest Expense

During the quarter ended September 29, 2024, interest expense was $5.7 million, a decrease of $2.4 million from the comparable period in 2023, primarily due to lower outstanding term loan borrowings under the Facility.

For the nine months ended September 29, 2024, interest expense was $18.3 million, a decrease of $6.7 million from the comparable period in 2023, primarily due to lower outstanding term loan borrowings as discussed above.

Provision for Income Taxes

The effective tax rate for the three and nine months ended September 29, 2024, was 21.2% and 24.4%, respectively, compared to 38.7% and 32.0% for the same periods in 2023.

The effective tax rate for 2024 was positively impacted by the release of a valuation allowance on interest expense carryforwards, utilization of previously unrealized interest expense carryforwards and an increase in tax benefits related to share-based compensation, partially offset by a decrease in U.S.

tax benefits related to foreign tax credit utilization, foreign derived intangible income, and the repatriation of previously taxed foreign earnings.

The effective tax rate for 2023 was negatively impacted by the limitation on the deductibility of interest expense under Internal Revenue Code section 163(j) and non-deductible charges related to the substantial liquidation of subsidiaries in Brazil and Russia.

During the quarter ended March 30, 2025, interest expense was $4.4 million, a decrease of $2.0 million from the comparable period in 2024, primarily due to lower outstanding term loan borrowings under the Facility.

Segment Operating Results

During the first quarter of 2024, the Company implemented a cost center realignment initiative to centralize certain global/shared functions.

For the three and nine months ended September 29, 2024, SG&A expenses for these global support functions were allocated to adjusted operating income (“AOI”) for each reportable segment consistent with the allocation methodology used to allocate corporate overhead in prior periods.

Prior year AOI amounts below were not recast as there was no material impact to the measure of segment profit for each reportable segment.

There were no changes to the composition of the Company’s operating or reportable segments.

AMS Segment – Net Sales and AOI

The following table presents AMS segment net sales and AOI for the three-month and nine-month periods ended September 29, 2024, and October 1, 2023:

Three Months Ended Percentage Change Nine Months Ended Percentage Change

September 29, 2024 October 1, 2023 September 29, 2024 October 1, 2023

(in thousands) (in thousands)

AMS Segment – Net Sales and Adjusted Operating Income (“AOI”)

The following table presents AMS segment net sales and AOI for the three-month periods ended March 30, 2025, and March 31, 2024:

Three Months Ended Percentage Change

March 30, 2025 March 31, 2024

(in thousands)

AMS segment net sales $ 179,937 $ 169,915 5.9 %

1 unchanged sentence

19,863 18,080 9.9 %

(1) Includes allocation of corporate SG&A expenses and allocation of global support SG&A expenses as discussed above.

Excludes Cyber Event impact and restructuring, asset impairment, severance, and other, net.

(1) Includes allocation of corporate and global support SG&A expenses.

Excludes restructuring, asset impairment, severance, and other, net and the impact of a cyber event.

See Note 10 entitled “Segment Information” of Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

During the third quarter of 2024, net sales in AMS increased 17.9% versus the comparable period in 2023, primarily due to higher sales volume and average sales prices.

On a market segment basis, the AMS sales increase was primarily in the retail, education, corporate office, and public buildings market segments.

During the first nine months of 2024, net sales in AMS increased 8.4% versus the comparable period in 2023, primarily due to higher sales volume and average sales prices.

On a market segment basis, the AMS sales increase was primarily in education, retail, public buildings, and residential living market segments partially offset by decreases in the healthcare market segment.

AOI in AMS increased 38.0% during the third quarter of 2024 compared to the prior year period, primarily due to higher sales and higher gross profit driven by raw material cost deflation and favorable fixed cost absorption.

As a percentage of net sales, AOI increased to 15.3% during the third quarter of 2024 compared to 13.1% in the same period last year.

AOI in AMS increased 31.7% during the first nine months of 2024 compared to the prior year period, primarily due to higher sales and higher gross profit driven by raw material cost deflation.

As a percentage of net sales, AOI increased to 13.0% during the first nine months of 2024 compared to 10.7% in the same period last year.

During the first quarter of 2025, net sales in AMS increased 5.9% versus the comparable period in 2024 primarily due to higher sales volumes.

On a market segment basis, the AMS sales increase was primarily in the education, retail, and healthcare market segments partially offset by a decrease in the corporate office market segment.

AOI in AMS increased 9.9% during the first quarter of 2025 compared to the prior year period primarily due to higher sales.

As a percentage of net sales, AOI increased to 11.0% during the first quarter of 2025 compared to 10.6% in the same period last year.

EAAA Segment – Net Sales and AOI

The following table presents EAAA segment net sales and AOI for the three-month and nine-month periods ended September 29, 2024, and October 1, 2023:

Three Months Ended Percentage Change Nine Months Ended Percentage Change

September 29, 2024 October 1, 2023 September 29, 2024 October 1, 2023

(in thousands) (in thousands)

The following table presents EAAA segment net sales and AOI for the three-month periods ended March 30, 2025, and March 31, 2024:

Three Months Ended Percentage Change

March 30, 2025 March 31, 2024

(in thousands)

EAAA segment net sales $ 117,476 $ 119,828 (2.0) %

1 unchanged sentence

5,591 7,445 (24.9) %

(1) Includes allocation of corporate SG&A expenses and allocation of global support SG&A expenses as discussed above.

Excludes purchase accounting amortization, Cyber Event impact, and restructuring, asset impairment, severance and other, net.

(1) Includes allocation of corporate and global support SG&A expenses.

Excludes purchase accounting amortization, restructuring, asset impairment, severance and other, net, and the impact of a cyber event.

See Note 10 entitled “Segment Information” of Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

During the third quarter of 2024, net sales in EAAA increased 1.0% versus the comparable period in 2023.

Currency fluctuations had a positive impact on EAAA sales of approximately $1.6 million (1.2%) for the third quarter of 2024 compared to the same period last year due to the strengthening of the Euro, Australian dollar, and the British Pound sterling against the U.S.

On a market segment basis, the EAAA sales increase was primarily in the education and residential living market segments partially offset by decreases in the hospitality and corporate office market segments.

During the first nine months of 2024, net sales in EAAA decreased 0.5% versus the comparable period in 2023, primarily due to lower sales volume.

Currency fluctuations had no material impact on EAAA sales for the first nine months of 2024 compared to the same period last year.

On a market segment basis, the EAAA sales decrease was primarily in the public buildings, hospitality, and healthcare market segments partially offset by increases in the corporate office, education, and residential living market segments.

AOI in EAAA increased 24.9% during the third quarter of 2024 versus the comparable period in 2023, primarily due to higher gross profit driven by raw material cost deflation.

Currency fluctuations had no material impact on EAAA AOI for the third quarter of 2024 compared to the same period last year.

As a percentage of net sales, AOI increased to 8.4% during the third quarter of 2024 compared to 6.8% in the same period last year.

AOI in EAAA increased 86.9% during the first nine months of 2024 versus the comparable period in 2023, primarily due to higher gross profit driven by raw material cost deflation.

Currency fluctuations had no material impact on EAAA AOI for the first nine months of 2024 compared to the same period in 2023.

As a percentage of net sales, AOI increased to 8.1% during the first nine months of 2024 compared to 4.3% in the same period last year.

During the first quarter of 2025, net sales in EAAA decreased 2.0% versus the comparable period in 2024, primarily due to unfavorable currency fluctuations of approximately $3.6 million (3.0%) from the weakening of the Euro and Australian dollar against the U.S.

On a market segment basis, the EAAA sales decrease was most significant in the corporate office market segment.

AOI in EAAA decreased 24.9% during the first quarter of 2025 versus the comparable period in 2024, primarily due to lower sales and lower gross profit margin as a result of higher manufacturing costs and higher freight costs.

As a percentage of net sales, AOI decreased to 4.8% during the first quarter of 2025 compared to 6.2% in the same period last year.

Financial Condition, Liquidity and Capital Resources

At September 29, 2024, the Company had $115.6 million in cash.

At March 30, 2025, the Company had $97.8 million in cash.

At that date, the Company had $5.5 million in term loan borrowings, no revolving loan borrowings, and $0.5 million in letters of credit outstanding under our Facility, and we had $300.0 million of Senior Notes outstanding.

As of September 29, 2024, we had additional borrowing capacity of $299.3 million under the Facility.

As of March 30, 2025, we had additional borrowing capacity of $299.5 million under the Facility.

We anticipate that our liquidity is sufficient to meet our obligations for the next 12 months, and we expect to generate sufficient cash to meet our long-term obligations.

1 unchanged sentence

The Company’s foreign subsidiaries and certain non-material domestic subsidiaries are considered non-guarantors.

Net sales for the non-guarantor subsidiaries were approximately $149 million and $427 million for the three-month and nine-month periods ended September 29, 2024, respectively, and net sales for the non-guarantor subsidiaries were approximately $148 million and $431 million for the three-month and nine-month periods ended October 1, 2023, respectively.

Total indebtedness of the non-guarantor subsidiaries was approximately $130 million and $133 million as of September 29, 2024 and December 31, 2023, respectively.

Net sales for the non-guarantor subsidiaries were approximately $129 million and $133 million for the three-month periods ended March 30, 2025 and March 31, 2024, respectively.

Total indebtedness of the non-guarantor subsidiaries was approximately $105 million and $102 million as of March 30, 2025 and December 29, 2024, respectively.

Balance Sheet

Accounts receivable, net, were $173.9 million at September 29, 2024, compared to $163.4 million at December 31, 2023.

The increase of $10.5 million was primarily due to the impact of higher net sales as a result of increased customer demand in 2024.

Inventories, net, were $283.1 million at September 29, 2024, compared to $279.1 million at December 31, 2023.

The increase of $4.0 million was primarily due to finished goods inventory build attributable to higher expected customer demand in the remainder of 2024, partially offset by lower raw material costs.

Accounts receivable, net, were $162.8 million at March 30, 2025, compared to $171.1 million at December 29, 2024.

The decrease of $8.3 million was primarily due to customer collections in the first quarter of 2025.

Inventories, net, were $281.7 million at March 30, 2025, compared to $260.6 million at December 29, 2024.

The increase of $21.1 million was primarily due to finished goods inventory build attributable to expected higher customer demand in the remainder of 2025.

Analysis of Cash Flows

The following table presents a summary of cash flows for the nine-month periods ended September 29, 2024 and October 1, 2023, respectively:

Nine Months Ended

September 29, 2024 October 1, 2023

The following table presents a summary of cash flows for the three-month periods ended March 30, 2025 and March 31, 2024, respectively:

Three Months Ended

March 30, 2025 March 31, 2024

(in thousands)

7 unchanged sentences

Cash and cash equivalents at end of period $ 97,757 $ 89,774

Cash provided by operating activities was $110.4 million for the nine months ended September 29, 2024, which represents a decrease of $3.8 million from the prior year comparable period.

Higher sales during the first nine months of 2024 contributed to higher accounts receivable balances resulting in a use of cash for the current period.

The prior year comparable period includes a source of cash from accounts receivable collections compared with the first nine months of 2024, primarily attributable to delays in customer billings from the Cyber Event, in which those delayed billings were collected in the first quarter of 2023.

Additionally, the increase in inventories during the first nine months of 2024, as described above, resulted in a greater use of cash compared with the same period in the prior year.

Cash used in investing activities was $16.7 million for the nine months ended September 29, 2024, which represents an increase of $6.0 million from the prior year comparable period.

The increase was attributable to higher capital expenditures partially offset by cash proceeds received during the first nine months of 2024 from the sale of manufacturing equipment and insurance proceeds for property casualty losses.

The first nine months of 2023 include cash proceeds of approximately $6.6 million from the sale of the Company’s Thailand manufacturing facility.

Cash used in financing activities was $89.5 million for the nine months ended September 29, 2024, which represents an increase of $8.7 million from the prior year comparable period.

The increase was primarily attributable to higher prepayments of term loan borrowings during the first nine months of 2024 compared to the prior year period.

Cash provided by operating activities was $11.7 million for the three months ended March 30, 2025, which represents a decrease of $0.9 million from the prior year comparable period.

The decrease was primarily due to changes in working capital during the first three months of 2025 compared with the first three months of 2024.

Cash used in investing activities was $7.5 million for the three months ended March 30, 2025, which represents an increase of $5.5 million from the prior year comparable period, primarily attributable to a greater capital investment in manufacturing automation and robotics solutions during the three months ended March 30, 2025.

Cash used in financing activities was $8.7 million for the three months ended March 30, 2025, which represents a decrease of $21.1 million from the prior year comparable period.

The year-over-year decrease was primarily due to lower outstanding borrowings under the credit facility resulting in lower repayments during the three months ended March 30, 2025.

We anticipate a strong second quarter amid increased global macro-economic uncertainty.

We anticipate revenue growth in the second quarter of fiscal year 2025 compared with the first quarter of 2025.

We expect that tariffs will impact our results during the third quarter of 2025, and we expect to offset this impact through incremental pricing and productivity initiatives.

Cash flows from operations, cash and cash equivalents, and other sources of liquidity are expected to be available and sufficient to meet foreseeable cash requirements.

However, the Company’s cash flows from operations can be affected by numerous factors including raw material availability and cost, and demand for our products.

As of October 20, 2024, the consolidated backlog of unshipped orders was approximately $242.3 million.

As of April 20, 2025, the consolidated backlog of unshipped orders was approximately $255.4 million.

As disclosed in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024, backlog was approximately $223.4 million as of February 2, 2025.

Disruptions in supply and distribution chains have resulted in delays of construction projects and flooring installations in many regions worldwide, which have also caused, and may continue to cause, fluctuations in our backlog.

D isruptions in supply and distribution chains have resulted in delays of construction projects and flooring installations in many regions worldwide, which also have caused, and may continue to cause, fluctuations in our backlog.

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