INTERFACE INC 10-Q

ITEM 1. FINANCIAL STATEMENTS INTERFACE, INC. AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (in thousands, except par values) JULY 5, 2026 DECEMBER 28, 2025 (UNAUDITED) ASSETS Current assets Cash and cash equivalents $ 81,528 $ 71,323 Accounts receivable, net 209,982 174,457 Inventories, net 291,598 275,014 Prepaid expenses and other current assets 42,465 34,048 Total current assets 625,573 554,842 Property, plant and equipment, net 313,478 309,449 Operating lease right-of-use assets 69,944 78,191 Deferred tax assets 24,848 25,272 Goodwill and intangible assets, net 158,471 163,012 Other assets 77,926 75,756 Total assets $ 1,270,240 $ 1,206,522 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Accounts payable $ 87,133 $ 64,768 Accrued expenses 137,058 147,770 Current portion of operating lease liabilities 14,537 15,748 Current portion of long-term debt 8,790 8,778 Total current liabilities 247,518 237,064 Long-term debt 195,566 172,801 Operating lease liabilities 60,058 67,205 Deferred income taxes 23,181 23,365 Other long-term liabilities 65,552 65,413 Total liabilities 591,875 565,848 Commitments and contingencies (Note 14) Shareholders’ equity Preferred stock, par value $ 1.00 per share; 5,000 shares authorized; none issued or outstanding at July 5, 2026 and December 28, 2025 — — Common stock, par value $ 0.10 per share; 120,000 shares authorized; 57,800 and 57,891 shares issued and outstanding at July 5, 2026 and December 28, 2025, respectively 5,780 5,789 Additional paid-in capital 223,834 248,910 Retained earnings 589,377 517,980 Accumulated other comprehensive loss – foreign currency translation ( 102,540 ) ( 92,691 ) Accumulated other comprehensive loss – pension liability ( 38,086 ) ( 39,314 ) Total shareholders’ equity 678,365 640,674 Total liabilities and shareholders’ equity $ 1,270,240 $ 1,206,522 See accompanying notes to consolidated condensed financial statements. 3 Tab l e of Contents INTERFACE, INC. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share data) THREE MONTHS ENDED SIX MONTHS ENDED JULY 5, 2026 JUNE 29, 2025 JULY 5, 2026 JUNE 29, 2025 Net sales $ 395,698 $ 375,522 $ 726,735 $ 672,935 Cost of sales 217,616 227,545 421,930 413,995 Gross profit 178,082 147,977 304,805 258,940 Selling, general and administrative expenses 103,166 95,930 197,559 183,666 Operating income 74,916 52,047 107,246 75,274 Interest expense, net 2,374 4,443 5,039 8,858 Other expense, net 1,717 3,411 2,491 5,114 Income before income tax expense 70,825 44,193 99,716 61,302 Income tax expense 19,418 11,632 24,698 15,739 Net income $ 51,407 $ 32,561 $ 75,018 $ 45,563 Earnings per share – basic $ 0.89 $ 0.56 $ 1.29 $ 0.78 Earnings per share – diluted $ 0.88 $ 0.55 $ 1.28 $ 0.77 Common shares outstanding – basic 57,919 58,555 58,012 58,495 Common shares outstanding – diluted 58,296 59,073 58,656 59,123 See accompanying notes to consolidated condensed financial statements. 4 Tab l e of Contents INTERFACE, INC. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (in thousands) THREE MONTHS ENDED SIX MONTHS ENDED JULY 5, 2026 JUNE 29, 2025 JULY 5, 2026 JUNE 29, 2025 Net income $ 51,407 $ 32,561 $ 75,018 $ 45,563 Other comprehensive (loss) income, after tax: Foreign currency translation adjustment ( 1,505 ) 33,445 ( 9,849 ) 49,279 Pension liability adjustment ( 160 ) ( 1,782 ) 1,228 ( 2,477 ) Other comprehensive (loss) income ( 1,665 ) 31,663 ( 8,621 ) 46,802 Comprehensive income $ 49,742 $ 64,224 $ 66,397 $ 92,365 See accompanying notes to consolidated condensed financial statements. 5 Tab l e of Contents INTERFACE, INC. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) SIX MONTHS ENDED JULY 5, 2026 JUNE 29, 2025 OPERATING ACTIVITIES: Net income $ 75,018 $ 45,563 Adjustments to reconcile net income to cash provided by operating activities: Depreciation and amortization 19,796 19,230 Share-based compensation expense 9,639 6,917 Deferred income taxes 890 254 Amortization of acquired intangible assets — 2,606 Other ( 4,123 ) 1,111 Working capital changes: Accounts receivable ( 36,530 ) ( 14,739 ) Inventories ( 19,327 ) ( 12,101 ) Prepaid expenses and other current assets ( 8,772 ) ( 4,408 ) Accounts payable and accrued expenses 15,297 ( 2,566 ) Cash provided by operating activities 51,888 41,867 INVESTING ACTIVITIES: Capital expenditures ( 22,527 ) ( 14,821 ) Cash used in investing activities ( 22,527 ) ( 14,821 ) FINANCING ACTIVITIES: Borrowings of long-term debt 92,763 1,306 Repayments of long-term debt ( 70,283 ) ( 253 ) Repurchases of common stock ( 20,795 ) ( 4,286 ) Tax withholding payments for share-based compensation ( 13,990 ) ( 7,736 ) Dividends paid ( 3,621 ) ( 1,227 ) Finance lease payments ( 1,922 ) ( 1,544 ) Cash used in financing activities ( 17,848 ) ( 13,740 ) Net cash provided by operating, investing and financing activities 11,513 13,306 Effect of exchange rate changes on cash ( 1,308 ) 9,169 CASH AND CASH EQUIVALENTS: Net increase 10,205 22,475 Balance, beginning of period 71,323 99,226 Balance, end of period $ 81,528 $ 121,701 See accompanying notes to consolidated condensed financial statements. 6 Tab l e of Contents INTERFACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation References in this Quarterly Report on Form 10-Q to “Interface,” “the Company,” “we,” “our,” “ours” and “us” refer to Interface, Inc. and its subsidiaries or any of them, unless the context requires otherwise. As contemplated by the Securities and Exchange Commission (the “Commission”) instructions to Form 10-Q, the following footnotes have been condensed and, therefore, do not contain all disclosures required in connection with annual financial statements. Reference should be made to the Company’s year-end financial statements and notes thereto contained in its Annual Report on Form 10-K for the fiscal year ended December 28, 2025, as filed with the Commission. The financial information included in this report has been prepared by the Company. In the opinion of management, the financial information included in this report contains all adjustments necessary for a fair presentation of the results for the interim periods. All such adjustments are of a normal recurring nature unless otherwise disclosed. Nevertheless, the results shown for interim periods are not necessarily indicative of results to be expected for the full year. The December 28, 2025, consolidated condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States (“GAAP”). The six-month period ended July 5, 2026 includes 27 weeks, and the six-month period ended June 29, 2025 includes 26 weeks. The three-month periods ended July 5, 2026 and June 29, 2025 both include 13 weeks. Risks and Uncertainties Ongoing global economic challenges including but not limited to inflation, government-imposed tariffs, supply chain disruptions, disruptions in global energy markets, the Russia-Ukraine war and conflicts in the Middle East, and slow market conditions in certain parts of the globe could cause economic uncertainty and volatility. The Company considered these impacts and subsequent general uncertainties and volatility in the global economy on the assumptions and estimates used herein. These uncertainties could result in a future material adverse effect to the amounts reported within the Company’s consolidated condensed financial statements if actual results differ from these estimates. Accounting Policies The Company’s accounting policies are set forth in its most recently filed Annual Report on Form 10-K. There have been no material changes to the Company’s accounting policies during the first six months of 2026. During the first quarter of 2026, the U.S. Supreme Court ruled that tariffs previously paid under the International Emergency Economic Powers Act (“IEEPA”) were invalid. The Company elected to apply the gain contingency model to account for potential tariff refunds previously paid under the IEEPA. Under this model, a gain contingency is not recognized in the financial statements until the gain is realized or realizable. During the second quarter of 2026, the Company recognized approximately $ 15.6 million in refunds for tariffs previously paid under the IEEPA, which were recognized as a reduction to cost of sales in the consolidated condensed statements of operations. In connection with these tariff refunds, the Company also recorded approximately $ 0.5 million of interest income, presented as a reduction to interest expense, net in the consolidated condensed statements of operations. In the consolidated condensed balance sheets, the Company recorded $ 7.6 million as an accounts receivable as a portion of these tariff-related amounts recognized was not collected during the second quarter of 2026 but was realizable pursuant to the gain contingency guidance as of July 5, 2026, with the remainder of the tariff-related amounts recorded as an increase in cash. Any outstanding requests for IEEPA tariff refunds are not material. 7 Tab l e of Contents Recently Issued Accounting Pronouncements – Not Yet Adopted In September 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-06 - “ Intangibles - Goodwill and Other Internal Use Software (Topic 350-40)”. This ASU amends the accounting for internal-use software costs by removing reference to prescriptive and sequential software development stages used to evaluate capitalizable costs. The ASU requires entities to consider whether significant uncertainties associated with development activities have been resolved prior to capitalization of software costs and aligns disclosure requirements with Accounting Standards Codification (“ASC”) 360, “ Property, Plant, and Equipment”. The new guidance in ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim periods within those annual reporting periods, and may be applied prospectively, retrospectively, or using a modified retrospective approach. Early adoption is permitted. The Company is currently evaluating the impact of this ASU to its consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, “Income Statement Reporting - Comprehensive Income - Expense Disaggregation (Topic 220-40)”. This ASU requires public entities to provide additional footnote disclosures to disaggregate the cost and expense line items presented in the income statement into specific categories including (a) purchases of inventory; (b) employee compensation; (c) depreciation; and (d) intangible asset amortization. The ASU also requires qualitative disclosure of other relevant expense categories not separately disclosed, the total amount of selling expenses, and the definition of selling expenses in annual reporting periods. The new guidance in ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU to its consolidated financial statements. 8 Tab l e of Contents NOTE 2 – REVENUE RECOGNITION The Company generates revenue from sales of modular carpet, resilient flooring, rubber flooring, and other flooring-related material, and from the installation of carpet and other flooring-related material. For both the three and six month periods ended July 5, 2026 and June 29, 2025 revenue from sales of flooring material was 98 % of total revenue. The remaining 2 % of revenue was generated from the installation of flooring material for both the three and six month periods ended July 5, 2026 and June 29, 2025. Disaggregation of Revenue For the three and six months ended July 5, 2026 and June 29, 2025, revenue from the Company’s customers is broken down by geography as a percentage of consolidated totals as follows: Three Months Ended Six Months Ended Geography July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 Americas 63 % 64 % 61 % 62 % Europe 27 % 27 % 29 % 28 % Asia-Pacific 10 % 9 % 10 % 10 % Revenue from the Company’s customers in the Americas corresponds to the AMS reportable segment, and the EAAA reportable segment includes revenue from the Europe and Asia-Pacific geographies. See Note 10 entitled “Segment Information” for additional information. For the three and six months ended July 5, 2026 and June 29, 2025, revenue by material market segment as a percentage of consolidated totals is as follows: Three Months Ended Six Months Ended Market Segment July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 Corporate Office 42 % 42 % 44 % 44 % Education 25 % 25 % 21 % 22 % Healthcare 11 % 10 % 11 % 10 % Other 22 % 23 % 24 % 24 % 9 Tab l e of Contents NOTE 3 – INVENTORIES Inventories are summarized as follows: July 5, 2026 December 28, 2025 (in thousands) Finished goods $ 210,736 $ 205,115 Work-in-process 24,306 17,418 Raw materials 56,556 52,481 Inventories, net $ 291,598 $ 275,014 10 Tab l e of Contents NOTE 4 – EARNINGS PER SHARE The Company computes basic earnings per share (“EPS”) by dividing net income by the weighted average common shares outstanding, including participating securities outstanding, during the period as discussed below. Diluted EPS reflects the potential dilution beyond shares for basic EPS that could occur if securities or other contracts to issue common stock were exercised, converted into common stock or resulted in the issuance of common stock that would have shared in the Company’s earnings. The Company includes all unvested stock awards that contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, in the number of shares outstanding for basic EPS as these awards are considered participating securities. Unvested share-based awards of restricted stock are paid dividends equally with all other shares of common stock and are considered participating securities. As a result, the Company includes all outstanding restricted stock awards during the period in the calculation of basic and diluted EPS. As of July 5, 2026, there were no unvested restricted stock awards. Any unvested share-based awards considered non-participating securities (restricted share units and performance shares) are included in diluted EPS calculations when the inclusion of these shares would be dilutive. The following table shows the computation of basic and diluted EPS: Three Months Ended Six Months Ended July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands, except per share data) Numerator: Net income (1) $ 51,407 $ 32,561 $ 75,018 $ 45,563 Denominator: Weighted average shares outstanding 57,919 58,526 58,012 58,426 Participating securities — 29 — 69 Shares for basic EPS 57,919 58,555 58,012 58,495 Dilutive effect of non-participating securities 377 518 644 628 Shares for diluted EPS 58,296 59,073 58,656 59,123 Basic EPS $ 0.89 $ 0.56 $ 1.29 $ 0.78 Diluted EPS $ 0.88 $ 0.55 $ 1.28 $ 0.77 (1) Includes income attributable to participating securities, which was no t material for the three and six months ended June 29, 2025. 11 Tab l e of Contents NOTE 5 – LONG-TERM DEBT Long-term debt consisted of the following: July 5, 2026 December 28, 2025 Outstanding Principal Interest Rate (1) Outstanding Principal Interest Rate (1) (in thousands) (in thousands) Syndicated Credit Facility (2) : Revolving loan borrowings $ 33,123 4.96 % $ 6,158 6.07 % Term loan borrowings 171,413 4.92 % 175,621 5.09 % Total borrowings under Syndicated Credit Facility 204,536 4.92 % 181,779 5.12 % Total debt 204,536 181,779 Less: Unamortized debt issuance costs ( 180 ) ( 200 ) Total debt, net 204,356 181,579 Less: Current portion of long-term debt ( 8,790 ) ( 8,778 ) Total long-term debt, net $ 195,566 $ 172,801 (1) Represents the weighted average rate of interest for borrowings under the Syndicated Credit Facility, without the effect of debt issuance costs. (2) The Syndicated Credit Facility also includes a multicurrency revolving loan facility up to $ 250 million. Syndicated Credit Facility The Company’s Syndicated Credit Facility (the “Facility”) provides to the Company U.S. denominated and multicurrency term loans and provides to the Company and certain of its subsidiaries a multicurrency revolving loan facility. Each of the Company’s material domestic subsidiaries guarantee the obligations of the Company under its Facility. The Facility matures December 3, 2030. At July 5, 2026, the Company had available borrowing capacity of $ 216.3 million under the revolving loan facility. Interest on base rate loans is charged at varying rates computed by applying a margin depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. Interest on secured overnight financing rate based (“SOFR”) and alternative currency loans is charged at varying rates computed by applying a margin over the applicable SOFR rate or alternative currency rate, depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. In addition, the Company pays a commitment fee per annum (depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter) on the unused portion of the Facility. Fees for commercial letters of credit are computed as a percentage of the amount available to be drawn under such letters of credit. Fees for standby letters of credit are charged at varying rates computed by applying a margin of the amount available to be drawn under such standby letters of credit, depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. Under the Facility, the Company is required to make quarterly amortization payments of the term loan borrowings, which are due on the last day of the calendar quarter. The Company is in compliance with all covenants under the Facility and anticipates that it will remain in compliance with the covenants for the foreseeable future. 12 Tab l e of Contents NOTE 6 – SHAREHOLDERS’ EQUITY The following tables depict the activity in the accounts which make up shareholders’ equity for the three and six months ended July 5, 2026 and June 29, 2025: SHARES COMMON STOCK ADDITIONAL PAID-IN CAPITAL RETAINED EARNINGS FOREIGN CURRENCY TRANSLATION ADJUSTMENT PENSION LIABILITY TOTAL (in thousands, except per share data) Balance, at December 28, 2025 57,891 $ 5,789 $ 248,910 $ 517,980 $ ( 92,691 ) $ ( 39,314 ) $ 640,674 Net income — — — 23,611 — — 23,611 Issuances of stock related to restricted share units and performance shares 1,065 106 ( 106 ) — — — — Cash dividends declared, $ 0.03 per common share — — — ( 1,882 ) — — ( 1,882 ) Compensation expense related to share-based plans, net of forfeitures and shares received for tax withholdings ( 440 ) ( 44 ) ( 8,818 ) — — — ( 8,862 ) Share repurchases ( 461 ) ( 46 ) ( 11,954 ) — — — ( 12,000 ) Foreign currency translation adjustment — — — — ( 8,344 ) — ( 8,344 ) Pension liability adjustment — — — — — 1,388 1,388 Balance, at April 5, 2026 58,055 $ 5,805 $ 228,032 $ 539,709 $ ( 101,035 ) $ ( 37,926 ) $ 634,585 Net income — — — 51,407 — — 51,407 Issuances of stock related to restricted share units and performance shares 58 5 ( 5 ) — — — — Cash dividends declared, $ 0.03 per common share — — — ( 1,739 ) — — ( 1,739 ) Compensation expense related to share-based plans, net of forfeitures and shares received for tax withholdings ( 3 ) — 4,572 — — — 4,572 Share repurchases ( 310 ) ( 30 ) ( 8,765 ) — — — ( 8,795 ) Foreign currency translation adjustment — — — — ( 1,505 ) — ( 1,505 ) Pension liability adjustment — — — — — ( 160 ) ( 160 ) Balance, at July 5, 2026 57,800 $ 5,780 $ 223,834 $ 589,377 $ ( 102,540 ) $ ( 38,086 ) $ 678,365 13 Tab l e of Contents SHARES COMMON STOCK ADDITIONAL PAID-IN CAPITAL RETAINED EARNINGS FOREIGN CURRENCY TRANSLATION ADJUSTMENT PENSION LIABILITY TOTAL (in thousands, except per share data) Balance, at December 29, 2024 58,304 $ 5,830 $ 261,028 $ 405,441 $ ( 143,317 ) $ ( 39,834 ) $ 489,148 Net income — — — 13,002 — — 13,002 Issuances of stock related to restricted share units and performance shares 658 66 ( 66 ) — — — — Cash dividends declared, $ 0.01 per common share — — — ( 641 ) — — ( 641 ) Compensation expense related to share-based plans, net of forfeitures and shares received for tax withholdings ( 352 ) ( 35 ) ( 3,546 ) — — — ( 3,581 ) Foreign currency translation adjustment — — — — 15,834 — 15,834 Pension liability adjustment — — — — — ( 695 ) ( 695 ) Balance, at March 30, 2025 58,610 $ 5,861 $ 257,416 $ 417,802 $ ( 127,483 ) $ ( 40,529 ) $ 513,067 Net income — — — 32,561 — — 32,561 Issuances of stock related to restricted share units and performance shares 1 — — — — — — Cash dividends declared, $ 0.01 per common share — — — ( 586 ) — — ( 586 ) Compensation expense related to share-based plans, net of forfeitures and shares received for tax withholdings — — 2,765 — — — 2,765 Share repurchases ( 218 ) ( 22 ) ( 4,423 ) — — — ( 4,445 ) Foreign currency translation adjustment — — — — 33,445 — 33,445 Pension liability adjustment — — — — — ( 1,782 ) ( 1,782 ) Balance, at June 29, 2025 58,393 $ 5,839 $ 255,758 $ 449,777 $ ( 94,038 ) $ ( 42,311 ) $ 575,025 14 Tab l e of Contents Repurchases of Common Stock In May 2022, the Company adopted a share repurchase program in which the Company is authorized to repurchase up to $ 100 million of its outstanding shares of common stock. The program has no specific expiration date. During the six months ended July 5, 2026, the Company repurchased 771,125 shares of common stock at a weighted average price of $ 26.90 per share pursuant to this program. Stock Incentive Plan The Company has share-based employee compensation plans, which are described more fully in Note 13 to the consolidated financial statements included in Item 8 of the Annual Report on Form 10-K for the fiscal year ended December 28, 2025 . Restricted Share Unit Awards Compensation expense related to the restricted share units was $ 3.8 million and $ 3.1 million for the six months ended July 5, 2026 and June 29, 2025, respectively. The Company has reduced its expense for any restricted share units forfeited during the period. The following table summarizes restricted share units outstanding as of July 5, 2026, as well as activity during the six months then ended: Restricted Share Units Weighted Average Grant Date Fair Value Outstanding at December 28, 2025 797,400 $ 15.88 Granted 256,000 31.04 Vested ( 487,500 ) 13.95 Forfeited or canceled ( 11,500 ) 20.54 Outstanding at July 5, 2026 554,400 $ 24.48 As of July 5, 2026, the unrecognized total compensation cost related to unvested restricted share units was $ 10.8 million. That cost is expected to be recognized by the second quarter of 2029. Performance Share Awards The following table summarizes the performance shares outstanding as of July 5, 2026, as well as the activity during the six months then ended: Performance Shares Weighted Average Grant Date Fair Value Outstanding at December 28, 2025 1,070,300 $ 14.04 Granted 399,200 21.53 Vested ( 635,500 ) 10.79 Forfeited or canceled ( 14,900 ) 19.34 Outstanding at July 5, 2026 819,100 $ 20.11 Compensation expense related to the performance shares was $ 5.8 million and $ 3.4 million for the six months ended July 5, 2026 and June 29, 2025, respectively. The Company has reduced its expense for any performance shares forfeited during the period. Unrecognized compensation expense related to these performance shares was approximately $ 12.7 million as of July 5, 2026. The amount and timing of future compensation expense will depend on the performance of the Company. The compensation expense related to these outstanding performance shares is expected to be recognized by the first quarter of 2029. The tax benefit recognized with respect to restricted share units and performance shares was approximately $ 1.3 million for the six months ended July 5, 2026 . 15 Tab l e of Contents NOTE 7 – LEASES The table below represents a summary of the balances recorded in the consolidated condensed balance sheets related to the Company’s leases as of July 5, 2026 and December 28, 2025: July 5, 2026 December 28, 2025 Balance Sheet Location Operating Leases Finance Leases Operating Leases Finance Leases (in thousands) Operating lease right-of-use assets $ 69,944 $ 78,191 Current portion of operating lease liabilities $ 14,537 $ 15,748 Operating lease liabilities 60,058 67,205 Total operating lease liabilities $ 74,595 $ 82,953 Property, plant and equipment, net $ 11,057 $ 9,574 Accrued expenses $ 3,527 $ 3,155 Other long-term liabilities 7,923 6,817 Total finance lease liabilities $ 11,450 $ 9,972 As of July 5, 2026, there were no significant leases that had not commenced. Lease Costs Three Months Ended Six Months Ended July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands) Finance lease cost: Amortization of right-of-use assets $ 1,044 $ 869 $ 2,063 $ 1,717 Interest on lease liabilities 169 139 342 276 Operating lease cost 4,829 5,126 10,338 10,119 Short-term lease cost 115 125 271 296 Variable lease cost 788 716 1,478 1,489 Total lease cost $ 6,945 $ 6,975 $ 14,492 $ 13,897 16 Tab l e of Contents Other Supplemental Information Three Months Ended Six Months Ended July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for finance leases $ 156 $ 134 $ 328 $ 265 Operating cash flows for operating leases 4,763 4,610 11,040 9,047 Financing cash flows for finance leases 939 782 1,922 1,544 Right-of-use assets obtained in exchange for new finance lease liabilities 1,524 438 3,595 986 Right-of-use assets obtained in exchange for new operating lease liabilities 374 2,698 1,169 5,627 Lease Term and Discount Rate The table below presents the weighted average remaining lease terms and discount rates for finance and operating leases as of July 5, 2026 and December 28, 2025: July 5, 2026 December 28, 2025 Weighted-average remaining lease term – finance leases (in years) 4.03 4.07 Weighted-average remaining lease term – operating leases (in years) 6.75 7.05 Weighted-average discount rate – finance leases 5.77 % 6.52 % Weighted-average discount rate – operating leases 6.34 % 6.33 % Maturity Analysis A maturity analysis of lease payments under non-cancellable leases is presented as follows: Fiscal Year Operating Leases Finance Leases (in thousands) 2026 (excluding the six months ended July 5, 2026) $ 9,423 $ 2,091 2027 17,428 3,775 2028 13,662 2,812 2029 11,452 1,821 2030 8,686 1,126 Thereafter 31,855 1,196 Total future minimum lease payments (undiscounted) 92,506 12,821 Less: Present value discount ( 17,911 ) ( 1,371 ) Total lease liabilities $ 74,595 $ 11,450 17 Tab l e of Contents NOTE 8 – EMPLOYEE BENEFIT PLANS The Company has defined benefit and multi-employer pension plans, which are described more fully in Note 18 to the consolidated financial statements included in Item 8 of the Annual Report on Form 10-K for the fiscal year ended December 28, 2025 . During the three and six months ended July 5, 2026, the Company recorded multi-employer pension expense related to multi-employer contributions of $ 0.8 million and $ 1.6 million, respectively. During the three and six months ended June 29, 2025, the Company recorded multi-employer pension expense related to multi-employer contributions of $ 0.6 million and $ 1.3 million, respectively. The following tables provide the components of net periodic benefit cost for the three and six months ended July 5, 2026 and June 29, 2025: Three Months Ended Six Months Ended Defined Benefit Retirement Plans (Europe) July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands) Interest cost $ 1,849 $ 1,929 $ 3,706 $ 3,742 Expected return on plan assets ( 1,770 ) ( 2,061 ) ( 3,548 ) ( 3,999 ) Amortization of prior service cost 48 47 95 91 Amortization of net actuarial losses 408 398 818 773 Net periodic benefit cost $ 535 $ 313 $ 1,071 $ 607 Three Months Ended Six Months Ended Salary Continuation Plan July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands) Interest cost $ 256 $ 274 $ 512 $ 549 Amortization of net actuarial losses 64 48 127 95 Net periodic benefit cost $ 320 $ 322 $ 639 $ 644 Three Months Ended Six Months Ended nora Defined Benefit Plan July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands) Service cost $ 94 $ 111 $ 189 $ 214 Interest cost 308 272 619 525 Amortization of net actuarial gains ( 188 ) ( 90 ) ( 378 ) ( 172 ) Net periodic benefit cost $ 214 $ 293 $ 430 $ 567 The service cost component of net periodic benefit costs is presented within operating income in the consolidated condensed statements of operations, while all other components of net periodic benefit costs are presented within other expense, net, in the consolidated condensed statements of operations. 18 Tab l e of Contents NOTE 9 – GOODWILL AND OTHER INTANGIBLE ASSETS The ending balance and the change in the carrying amount of goodwill for the six months ended July 5, 2026 is as follows: Goodwill (1) (in thousands) Balance, at December 28, 2025 $ 112,127 Foreign currency translation (2) ( 3,047 ) Balance, at July 5, 2026 $ 109,080 (1) The goodwill balance is allocated entirely to the AMS reportable segment. (2) A portion of the goodwill balance is comprised of goodwill denominated in foreign currency attributable to the nora acquisition. The net carrying value of intangible assets other than goodwill was $ 49.4 million and $ 50.9 million at July 5, 2026 and December 28, 2025, respectively. 19 Tab l e of Contents NOTE 10 – SEGMENT INFORMATION The Company determines that an operating segment exists if a component (i) engages in business activities from which it earns revenues and incurs expenses, (ii) has operating results that are regularly reviewed by the chief operating decision maker (“CODM”) and (iii) has discrete financial information. Additionally, accounting standards require the utilization of a “management approach” to report the financial results of operating segments, which is based on information used by the CODM to assess performance and make operating and resource allocation decisions. The Company determined that it has two operating segments organized by geographical area – namely (a) Americas (“AMS”) and (b) Europe, Africa, Asia, and Australia (collectively “EAAA”). The AMS operating segment includes the United States, Canada and Latin America geographic areas. Pursuant to the management approach discussed above, the Company’s CODM, our chief executive officer, evaluates performance at the AMS and EAAA operating segment levels and makes operating and resource allocation decisions based on segment adjusted operating income (“AOI”). The CODM uses AOI to evaluate segment operating results compared to expectations. AOI is also used by the CODM to develop variable compensation targets and make capital spend decisions. AOI excludes: nora purchase accounting amortization and restructuring, asset impairment, severance, and other, net. Intersegment revenues for the three and six months ended July 5, 2026, were $ 35.1 million and $ 63.1 million, respectively, and intersegment revenues for the three and six months ended June 29, 2025, were $ 35.8 million and $ 63.8 million, respectively. Intersegment revenues are eliminated from net sales presented below since these amounts are not included in the information provided to the CODM. The Company has determined that it has two reportable segments – AMS and EAAA, as each operating segment meets the quantitative thresholds defined in the accounting guidance. The following table outlines information by reportable segment including net sales, significant segment expenses, and AOI. The table also includes a reconciliation to income before taxes for the three and six months ended July 5, 2026 and June 29, 2025. Three Months Ended July 5, 2026 June 29, 2025 AMS EAAA TOTAL AMS EAAA TOTAL (in thousands) Net sales $ 247,666 $ 148,032 $ 395,698 $ 239,443 $ 136,079 $ 375,522 Less: significant segment expenses (1) Adjusted cost of sales (2) 125,718 91,897 135,041 91,153 Adjusted selling, general, & administrative expenses (3) 60,962 42,171 55,557 37,861 Segment AOI 60,986 13,964 74,950 48,845 7,065 55,910 Reconciliation of AOI to income before taxes Restructuring, severance, asset impairment and other, net 34 2,511 Purchase accounting amortization — 1,352 Interest expense, net 2,374 4,443 Other expense, net 1,717 3,411 Income before taxes $ 70,825 $ 44,193 (1) Significant segment expense categories and amounts align with segment level information that is regularly provided to the CODM, included in the measure of segment profit, and considered to be significant. Amounts include allocation of corporate overhead and global support costs. Intersegment expenses are excluded. (2) Adjusted cost of sales excludes purchase accounting amortization for 2025. (3) Adjusted selling, general, and administrative expenses exclude restructuring, asset impairment, severance, and other, net. 20 Tab l e of Contents Six Months Ended July 5, 2026 June 29, 2025 AMS EAAA TOTAL AMS EAAA TOTAL (in thousands) Net sales $ 443,337 $ 283,398 $ 726,735 $ 419,380 $ 253,555 $ 672,935 Less: significant segment expenses (1) Adjusted cost of sales (2) 243,086 178,843 243,568 167,821 Adjusted selling, general, & administrative expenses (3) 115,369 81,764 107,104 73,079 Segment AOI 84,882 22,791 107,673 68,708 12,655 81,363 Reconciliation of AOI to income before taxes Restructuring, severance, asset impairment and other, net 427 3,483 Purchase accounting amortization — 2,606 Interest expense, net 5,039 8,858 Other expense, net 2,491 5,114 Income before taxes $ 99,716 $ 61,302 (1) Significant segment expense categories and amounts align with segment level information that is regularly provided to the CODM, included in the measure of segment profit, and considered to be significant. Amounts include allocation of corporate overhead and global support costs. Intersegment expenses are excluded. (2) Adjusted cost of sales excludes purchase accounting amortization for 2025. (3) Adjusted selling, general, and administrative expenses exclude restructuring, asset impairment, severance, and other, net. Segment depreciation and amortization for the three and six months ended July 5, 2026 and June 29, 2025 is presented as follows: Three Months Ended Six Months Ended July 5, 2026 June 29, 2025 July 5, 2026 June 29, 2025 (in thousands) (in thousands) Depreciation and amortization AMS $ 4,795 $ 4,740 $ 9,599 $ 9,327 EAAA 5,125 5,089 10,197 9,903 Total depreciation and amortization $ 9,920 $ 9,829 $ 19,796 $ 19,230 21 Tab l e of Contents A reconciliation of the Company’s total operating segment assets to the corresponding consolidated amounts is presented as follows: July 5, 2026 December 28, 2025 (in thousands) Assets AMS $ 643,056 $ 660,189 EAAA 639,748 619,663 Total segment assets 1,282,804 1,279,852 Corporate assets 124,142 98,853 Eliminations ( 136,706 ) ( 172,183 ) Total reported assets $ 1,270,240 $ 1,206,522 22 Tab l e of Contents NOTE 11 – SUPPLEMENTAL CASH FLOW INFORMATION Supplemental cash flow information for the six months ended July 5, 2026 and June 29, 2025 is presented in the following table: Six Months Ended July 5, 2026 June 29, 2025 (in thousands) Cash paid for interest $ 6,326 $ 8,935 See Note 7 entitled “Leases” for additional supplemental disclosures related to finance and operating leases. 23 Tab l e of Contents NOTE 12 – INCOME TAXES The Company determines its provision for income taxes for interim periods using an estimate of its annual effective tax rate (“AETR”) and records any changes affecting the estimated AETR in the interim period in which the change occurs, including discrete tax items. During the six months ended July 5, 2026, the Company recorded a total income tax provision of $ 24.7 million on pre-tax income of $ 99.7 million resulting in an effective tax rate of 24.8 %, as compared to a total income tax provision of $ 15.7 million on pre-tax income of $ 61.3 million resulting in an effective tax rate of 25.6 % during the six months ended June 29, 2025. The decrease in the effective tax rate for the six months ended July 5, 2026 as compared to the six months ended June 29, 2025, was primarily due to higher excess tax benefits related to share-based compensation. On December 20, 2021, the Organization for Economic Co-operation and Development (“OECD”) published Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large corporations at a minimum rate of 15 %. The OECD has since issued administrative guidance providing transition and safe harbor rules around the implementation of the Pillar Two global minimum tax. Many non-U.S. tax jurisdictions have enacted legislation to adopt the Pillar Two Model Rules beginning in 2024 (including the European Union Member States) or announced plans to enact legislation in future years. For fiscal year 2026, we expect to meet the Transitional Country-by-Country (CbCR) Safe Harbor rules for most if not all jurisdictions and do not expect these provisions to have a material impact on the Company’s financial statements. We will continue to closely monitor ongoing developments and evaluate any potential impact on future periods. In 2026, the OECD issued a Side-by-Side package (“SbS”) that simplifies Pillar Two, creates new safe harbors, fully exempts U.S. parent groups from two of the three top-up taxes, and extends the CbCR Safe Harbor through fiscal year 2027. In certain jurisdictions, local legislative action is needed to effectuate the SbS agreement and will be considered in our accounting estimate upon enactment. As of July 5, 2026, the Company had accrued approximately $ 5.1 million for unrecognized tax benefits. 24 Tab l e of Contents NOTE 13 – ITEMS RECLASSIFIED FROM ACCUMULATED OTHER COMPREHENSIVE LOSS Amounts reclassified out of accumulated other comprehensive loss (“AOCL”), before tax, to the consolidated condensed statements of operations during the three and six months ended July 5, 2026 and June 29, 2025 are reflected in the tables below: Three Months Ended Statement of Operations Location July 5, 2026 June 29, 2025 (in thousands) Amortization of benefit plan net actuarial losses and prior service cost Other expense, net $ ( 332 ) $ ( 403 ) Total loss reclassified from AOCL $ ( 332 ) $ ( 403 ) Six Months Ended Statement of Operations Location July 5, 2026 June 29, 2025 (in thousands) Amortization of benefit plan net actuarial losses and prior service cost Other expense, net $ ( 662 ) $ ( 787 ) Total loss reclassified from AOCL $ ( 662 ) $ ( 787 ) 25 Tab l e of Contents NOTE 14 – COMMITMENTS AND CONTINGENCIES From time to time, we are a party to legal proceedings, whether arising in the ordinary course of business or otherwise. For additional information see disclosures set forth in Note 17 to the consolidated financial statements included in Item 8 of the Annual Report on Form 10-K for the fiscal year ended December 28, 2025 . There have been no material changes since December 28, 2025. 26 Tab l e of Contents NOTE 15 – FAIR VALUE OF FINANCIAL INSTRUMENTS Accounting standards establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure estimated fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under applicable accounting standards are described below: Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2 Inputs to the valuation methodology include: • quoted prices for similar assets in active markets; • quoted prices for identical or similar assets in inactive markets; • inputs other than quoted prices that are observable for the asset; and • inputs that are derived principally or corroborated by observable data by correlation or other. Level 3 Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The following table presents the carrying values and estimated fair values, including the level within the fair value hierarchy, of certain financial instruments: July 5, 2026 December 28, 2025 Carrying Value Fair Value (Level 1) Fair Value (Level 2) Carrying Value Fair Value (Level 1) Fair Value (Level 2) (in thousands) Assets: Company-owned life insurance $ 23,140 $ — $ 23,140 $ 23,048 $ — $ 23,048 Deferred compensation investments 35,781 8,410 27,370 33,728 8,941 24,787 Liabilities (1) : Borrowings under Syndicated Credit Facility (2) 204,536 — 204,536 181,779 — 181,779 ( 1) Carrying values are presented gross, excluding the impact of unamortized debt issuance costs and including amounts presented as current liabilities on the consolidated condensed balance sheets. (2) The carrying value of borrowings under the Facility approximates fair value as the Facility bears variable interest rates that are similar to existing market rates. The fair value of borrowings under the Facility is estimated using observable market rates . The fair value of Company-owned life insurance is measured on a readily determinable cash surrender value on a recurring basis. Assets associated with the Company’s nonqualified savings plans are held in a rabbi trust and consist of investments in mutual funds and insurance contracts. The fair value of the mutual funds is derived from quoted prices in active markets. The fair value of the insurance contracts is based on observable inputs related to the performance measurement funds that shadow the deferral investment allocations made by participants in the nonqualified savings plans. 27 Tab l e of Contents