What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-02-24 compared with 2025-02-25 · 173 added, 186 removed, 323 unchanged (53% of the section changed)

19 unchanged sentences

as a percentage of net sales

Impairment of goodwill and other intangible assets

Impairment of long-lived assets

Realignment charges

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as a percentage of net sales

Impairment of goodwill and other intangible assets

Impairment of long-lived assets

Realignment charges

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as a percentage of net sales

Impairment of goodwill and other intangible assets

Impairment of long-lived assets

Realignment charges

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Net sales - fiscal 2025

On a consolidated basis, net sales decreased in fiscal 2024, as compared to fiscal 2023, primarily due to lower net sales in the Agriculture segment, while net sales in the Infrastructure segment remained relatively flat.

On a consolidated basis, both gross profit and gross profit as a percentage of net sales increased in fiscal 2024, as compared to fiscal 2023.

This growth was driven by higher gross profit in the Infrastructure segment, partially offset by a

decline in the Agriculture segment.

Favorable factors in the Infrastructure segment, including steel deflation, strong commercial execution, and effective pricing strategies, were partially offset by lower volumes and pricing in the Agriculture segment, particularly in Brazil.

During the third quarter of fiscal 2023, management initiated a plan to streamline segment support across the Company and reduce costs through an organizational realignment program (the “Realignment Program”).

The Realignment Program provided for a reduction in force through a voluntary early retirement program and other headcount reduction actions, which were completed by the end of fiscal 2023.

The Board of Directors authorized the incurrence of cash charges up to $36.0 million in connection with the Realignment Program of which $35.2 million were incurred in fiscal 2023.

Severance and other employee benefit costs totaled approximately $17.3 million within the Infrastructure segment, $9.1 million within the Agriculture segment, and $8.8 million within Corporate expense.

Consolidated selling, general, and administrative expenses (“SG&A”) decreased in fiscal 2024, as compared to fiscal 2023, primarily driven by lower compensation costs, largely attributable to the Realignment Program in fiscal 2023.

In fiscal 2023, SG&A in the Agriculture segment included $4.9 million in amortization of identified intangible assets and $7.1 million in stock-based compensation expense from the Prospera subsidiary acquired in fiscal 2021.

In fiscal 2024, Prospera intangible asset amortization was $0.4 million and stock-based compensation expense was $4.1 million.

Consolidated operating income increased in fiscal 2024, as compared to fiscal 2023, primarily due to the impairment of certain goodwill and intangible assets totaling $140.8 million and realignment charges totaling $35.2 million in fiscal 2023.

The increase was further supported by lower SG&A resulting from the Realignment Program and increased gross profit.

Acquisitions and Divestitures

We continue to strategically enhance our portfolio through targeted acquisitions and divestitures, demonstrating our commitment to refining our business focus and driving value within our core segments.

In the third quarter of fiscal 2023, we acquired HR Products, a leading wholesale supplier of irrigation parts in Australia, for $37.3 million, included in the Agriculture segment.

In the fourth quarter of fiscal 2024, we divested George Industries, a coating and anodizing company in California previously included in the Infrastructure segment, resulting in a loss of $2.8 million recorded in “Other income (expenses)” in the Consolidated Statements of Earnings.

In the fourth quarter of fiscal 2024, we divested our extractive business, which included the manufacturing and distribution of screening products for the mining and quarrying sectors in Australia and New Zealand, previously included in the Infrastructure segment, resulting in a loss of $1.7 million recorded in “Other income (expenses)” in the Consolidated Statements of Earnings.

In the second quarter of fiscal 2023, we divested Torrent Engineering and Equipment Company, LLC, an Indiana-based integrator of prepackaged pump stations previously included in the Agriculture segment, resulting in a gain of $3.0 million recorded in “Other income (expenses)” in the Consolidated Statements of Earnings.

Macroeconomic and Geopolitical Impacts on Financial Results and Liquidity

We manufacture Utility structures in Mexico and ship them to customers in the U.S.

In fiscal 2024, we imported approximately $230.0 million worth of fabricated steel structures from Mexico into the U.S.

On February 10, 2025, President Trump announced a 25% tariff on all steel and aluminum imports into the U.S., effective March 4, 2025.

The U.S.-Mexico tariff situation remains highly fluid, and we are assessing the duration and scope of this presidential order.

At this time, we cannot predict whether additional tariffs will be imposed.

tariffs on fabricated steel structures we produce are expected to apply to transfer prices from Mexico.

These potential tariffs, along with possible retaliatory measures from Mexico, could have a material adverse impact on our future cost of goods sold and operating income.

The ultimate effect will depend on the magnitude and duration of the tariffs, and we are actively assessing options to mitigate any potential impact.

We continue to monitor other macroeconomic and geopolitical uncertainties that have impacted or may impact our business, including inflationary cost pressures, supply chain disruptions, currency fluctuations against the U.S.

dollar, changing interest rates, ongoing international conflicts, and labor shortages.

These factors could impact our operational costs, revenue, and financial stability.

As conditions evolve, we are proactively adapting strategies to mitigate risks and ensure sufficient liquidity.

Reportable Segments

In addition to our two reportable segments, we had a business and related activities in fiscal 2022 that did not exceed 10% of consolidated sales, operating income, or assets.

This included the offshore wind energy structures business, which was reported in the Other segment until its divestiture in the fourth quarter of fiscal 2022.

For additional information, see Note 20 in our Consolidated Financial Statements.

As of December 28, 2024, the consolidated backlog of unshipped orders was approximately $1.4 billion, as compared to approximately $1.5 billion as of December 30, 2023.

This decrease is attributed to slight decreases in both the Infrastructure and Agriculture segments.

On a consolidated basis, net sales increased by 0.7% in fiscal 2025, as compared to fiscal 2024, primarily driven by higher net sales in the Infrastructure segment, partially offset by lower net sales in the Agriculture segment.

Growth in the Infrastructure segment was mainly attributable to improved pricing and mix, particularly within the Utility product line.

This increase was partially offset by reduced net sales resulting from the divestitures of George Industries in the Coatings product line ($5.5 million) and our extractive business in the Lighting and Transportation (“L&T”) product line ($7.4 million).

The decline in the Agriculture segment was driven by lower sales volumes in North America.

Consolidated gross profit decreased by 0.1% in fiscal 2025, as compared to fiscal 2024.

The decline was primarily attributable to lower sales volumes in North America within the Agriculture segment and reduced sales volumes in the L&T and Solar product lines within the Infrastructure segment.

These impacts were partially offset by higher sales volumes and improved pricing in the Utility and Telecommunications products lines within the Infrastructure segment.

Consolidated selling, general, and administrative (“SG&A”) expenses increased by 0.1% in fiscal 2025, as compared to fiscal 2024, primarily due to $24.2 million of legal contingency reserves and $23.8 million of expected credit losses in Brazil.

These increases were partially offset by lower compensation and incentive costs, driven in part by our strategic realignment, as well as reduced research and development costs primarily as a result from the exit of our Prospera business.

Consolidated operating income decreased by 20.8% in fiscal 2025, as compared to fiscal 2024, primarily due to the impairment of certain long-lived assets totaling $91.3 million, realignment charges of $15.4 million, and slightly higher SG&A expenses.

Net Interest Expense

Consolidated net interest expense increased in fiscal 2024, as compared to fiscal 2023, due to the increase in average outstanding borrowings on the revolving line of credit along with higher average interest rates.

Other Income / Expenses (Including Gain (Loss) on Deferred Compensation Investments)

Amounts in “Gain (loss) on deferred compensation investments” included changes in the market value of deferred compensation assets which were offset by an equal opposite amount included in SG&A for the corresponding change in the valuation of deferred compensation liabilities.

Other items included in “Other income (expenses)” were pension expenses along with losses related to the sales of George Industries and the extractive business in the fourth quarter of fiscal 2024 totaling approximately $4.5 million.

Pension expense was $0.6 million and $0.2 million in fiscal 2024 and 2023, respectively.

Consolidated net interest expense decreased by 37.2% in fiscal 2025, as compared to fiscal 2024, due to a decrease in average outstanding borrowings on the revolving line of credit along with lower average interest rates.

Other Income / Expenses

Amounts in “Gain on deferred compensation investments” on the Consolidated Statements of Earnings reflected changes in the market value of deferred compensation investments, which were fully offset by corresponding changes in the valuation of deferred compensation liabilities recorded in SG&A.

Other components of “Other income (expenses)” included pension expense of $1.1 million and $0.6 million in fiscal 2025 and 2024, respectively, and foreign currency revaluation losses of approximately $8.4 million resulting from depreciation of the Argentine peso against the U.S.

dollar in fiscal 2025.

Income Tax Expense

Our effective income tax rate in fiscal 2025 and fiscal 2024 was 6.3% and 25.2%, respectively.

In fiscal 2024, the effective tax rate was the result of changes in the geographical mix of earnings.

In fiscal 2023, the higher effective tax rate was the result of goodwill impairment charges for which no tax benefits were recorded.

In fiscal 2025, the reduction in the effective tax rate was the result of a tax benefit recognized for a worthless securities deduction of $73.8 million, the release of previously recorded valuation allowances on certain foreign tax credits of $13.4 million, and changes in the geographical mix of earnings.

The worthless securities deduction was the result of the exit of our Prospera business.

Infrastructure Segment

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Operating income

Infrastructure segment sales in fiscal 2024 were comparable to those in fiscal 2023.

A significant decline in Solar product line volumes was offset by higher volumes in the Utility product line and increased average selling prices, particularly in the Utility product line.

Regionally, Infrastructure segment sales grew in North America in fiscal 2024, as compared to fiscal 2023, but declined in international markets during the same period.

Sales in the Utility product line increased in fiscal 2024, as compared to fiscal 2023, driven by a continued focus on commercial excellence and a favorable product mix, including higher volumes of distribution and substation products.

factors more than offset the impact of steel index deflation on average selling prices.

The overall product line growth occurred amid strong demand in the utility market, fueled by ongoing investments in the global energy transition and grid hardening efforts.

Lighting and Transportation product line sales decreased in fiscal 2024, as compared to fiscal 2023.

This decline was due to lower sales volumes caused by continued softness in the lighting market, the timing of transportation projects, and an unfavorable currency translation effect totaling approximately $1.9 million.

Coatings product line sales decreased slightly in fiscal 2024, as compared to fiscal 2023, primarily due to lower sales volumes in international markets.

These declines were partially offset by increased average selling prices.

Telecommunications product line sales decreased in fiscal 2024, as compared to fiscal 2023, driven by lower sales volumes in the first half of fiscal 2024.

However, sales volumes rebounded in the second half of fiscal 2024, supported by increased carrier spending amid a stabilizing North American market environment.

Solar product line sales decreased significantly in fiscal 2024, as compared to fiscal 2023.

This decline was attributed to the non-recurrence of a large utility-scale project from fiscal 2023, a strategic decision in the second quarter of fiscal 2024 to exit certain low-margin projects, and an unfavorable foreign currency translation effect totaling approximately $1.4 million.

Infrastructure segment gross profit and gross profit as a percentage of net sales increased in fiscal 2024, as compared to fiscal 2023.

These improvements were driven by a favorable product mix and commercial excellence, which resulted in higher average selling prices that more than offset the impact of steel index deflation.

Infrastructure segment SG&A decreased in fiscal 2024, as compared to fiscal 2023.

This reduction was primarily due to lower compensation costs as a result of the Realignment Program.

Infrastructure segment operating income increased in fiscal 2024, as compared to fiscal 2023.

This improvement was driven by higher gross profit and lower SG&A.

In addition, we incurred severance costs totaling $17.3 million within the Infrastructure segment in fiscal 2023 related to the Realignment Program.

Infrastructure segment sales increased by 3.0% in fiscal 2025, as compared to fiscal 2024, driven primarily by higher sales volumes in the Utility and Telecommunications product lines, which more than offset declines in L&T and Solar product lines.

Regionally, Infrastructure segment sales grew in North America in fiscal 2025, as compared to fiscal 2024, while sales declined in international markets during the same period.

Utility product line sales increased by 10.4% in fiscal 2025, as compared to fiscal 2024, reflecting favorable market pricing and higher volumes.

Demand remained strong, supported by increased electrical energy consumption and utility

investment to expand and reinforce grid capacity, including to serve growing power demand from data centers and other load growth.

L&T product line sales decreased by 6.1% in fiscal 2025, as compared to fiscal 2024, driven by lower volumes in the Asia-Pacific region and softer market demand in North America.

The decline was further impacted by the divestiture of the extractive business in the fourth quarter of fiscal 2024.

Coatings product line sales increased by 2.4% in fiscal 2025, as compared to fiscal 2024, benefiting from healthy infrastructure demand.

The increase was partially offset by the divestiture of George Industries in the fourth quarter of fiscal 2024.

Telecommunications product line sales increased by 25.2% in fiscal 2025, as compared to fiscal 2024, driven by increased carrier spending in the North American market, supported by our quick-turn order strategy and alignment with carrier spending programs.

Solar product line sales decreased by 46.2% in fiscal 2025, as compared to fiscal 2024, primarily due to lower volumes resulting from our strategic decision to exit select regional markets in the second quarter of fiscal 2025.

Infrastructure segment gross profit increased by 2.4% in fiscal 2025, as compared to fiscal 2024, primarily due to higher volumes in the Utility and Telecommunications product lines, partially offset by lower Solar volumes.

In connection with lower anticipated volumes, we also recorded approximately $6.9 million of inventory reserves associated with our Solar businesses in fiscal 2025.

Infrastructure segment SG&A decreased by 2.0% in fiscal 2025, as compared to fiscal 2024, driven by lower incentive costs and research and development costs, partially offset by higher expected credit losses of approximately $14.3 million, primarily within the Solar product line.

Infrastructure segment operating income decreased by 13.5% in fiscal 2025, as compared to fiscal 2024, primarily due to impairment charges of $89.4 million related to certain long-lived assets primarily in the Solar and Access Systems reporting units, realignment charges of $7.6 million, and lower volumes in the L&T and Solar product lines.

Agriculture Segment

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Operating income

In North America, Agriculture segment sales declined in fiscal 2024, as compared to fiscal 2023.

This decrease was primarily driven by lower tubular steel product sales, reflecting weakness in the North American agriculture market.

Although sales of replacement irrigation equipment increased due to severe weather events earlier in fiscal 2024, these gains were partially offset by continued softness in the agriculture market, influenced by lower grain prices.

Additionally, average selling prices for irrigation equipment were slightly lower compared to the prior year.

In international markets, Agriculture segment sales decreased in fiscal 2024, as compared to fiscal 2023.

This was driven by significantly lower sales in Brazil, where normalizing backlog levels and lower grain prices impacted growers’ purchasing decisions.

In North America, Agriculture segment sales decreased by 11.3% in fiscal 2025, as compared to fiscal 2024, primarily due to lower irrigation equipment sales volumes, reflecting continued softness in the agriculture market.

Contributing factors included lower grain prices, uncertainty surrounding trade policy, and the timing of government funding.

The decrease was also impacted by lower replacement irrigation equipment sales following severe weather events in fiscal 2024.

In international markets, Agriculture segment sales increased by 0.2% in fiscal 2025, as compared to fiscal 2024, driven by sales growth in the Europe, Middle East, and Africa (“EMEA”) region.

This increase was partially offset by lower sales in South America, where normalizing backlog levels, higher credit costs, and lower grain prices impacted growers’ purchasing decisions.

The decline was further exacerbated by unfavorable foreign currency translation effects of $7.7 million.

However, sales growth in the Europe, Middle East, and Africa region, along with incremental sales from the HR Products acquisition in fiscal 2023, partially offset these declines.

Sales of Technology Products and Services decreased in fiscal 2024, as compared to fiscal 2023, primarily due to lower hardware sales volumes.

Our Agriculture business remains cyclical and is influenced by factors such as changes in net farm income, commodity prices, weather volatility, geopolitical events, and farmer sentiment regarding future economic conditions.

closely monitor these variables to assess their potential impacts on our financial performance, including estimated U.S.

net farm income data released by the U.S.

Department of Agriculture.

In Brazil, we actively track fluctuations in grain prices and projected farm input costs to evaluate grower sentiment.

Looking ahead, Irrigation Equipment and Parts sales in North America are expected to remain muted for fiscal 2025.

Agriculture segment gross profit decreased in fiscal 2024, as compared to fiscal 2023, primarily due to lower sales volumes, particularly in North America and Brazil, as well as an unfavorable geographic sales mix.

Agriculture segment SG&A decreased in fiscal 2024, as compared to fiscal 2023, primarily due to lower compensation costs, largely driven by the Realignment Program.

Additionally, intangible asset amortization expenses declined as a result of the third quarter of fiscal 2023 impairment of certain Prospera amortizing proprietary technology.

Agriculture segment operating income increased in fiscal 2024, as compared to fiscal 2023, primarily due to a $137.3 million impairment of certain goodwill and other intangible assets in fiscal 2023.

This increase was partially offset by lower sales volumes and decreased gross profit.

Furthermore, in fiscal 2023, we incurred $9.1 million in severance costs within the Agriculture segment related to the Realignment Program.

Corporate SG&A decreased in fiscal 2024, as compared to fiscal 2023, primarily due to lower compensation costs resulting from the Realignment Program in fiscal 2023, as well as reduced incentive expenses.

These reductions were partially offset by higher insurance expenses and increased technology costs.

In addition, in fiscal 2023, we incurred $8.8 million in severance and other employee benefit costs within Corporate expense as part of the Realignment Program.

The Agriculture business remains cyclical and is influenced by factors such as net farm income, commodity prices, weather volatility, geopolitical events, and farmer sentiment regarding future economic conditions.

We actively monitor these variables across our key markets.

In the U.S., we consider net farm income estimates published by the U.S.

Department of Agriculture as a key indicator of grower purchasing capacity.

In Brazil, we monitor grain prices, projected farm input costs, interest rates, and net farm income trends, which collectively influence grower liquidity, credit conditions, and purchasing

Looking ahead, we remain focused on navigating evolving market conditions and positioning the Agriculture business for long-term growth across both domestic and international markets.

Agriculture segment gross profit decreased 6.9% in fiscal 2025, as compared to fiscal 2024, primarily due to lower sales volumes, particularly in North America and South America, which more than offset volume gains in the EMEA region.

In fiscal 2025, we also increased inventory reserves by $8.5 million as a result of our slow-moving and obsolete inventory in response to continued softness within the agricultural market.

Agriculture segment SG&A increased by 9.1% in fiscal 2025, as compared to fiscal 2024, primarily due to $24.2 million of legal contingency reserves and $23.8 million of expected credit losses in Brazil, partially offset by lower compensation and incentive costs.

Agriculture segment operating income decreased by 33.4% in fiscal 2025, as compared to fiscal 2024.

The decline was primarily driven by lower sales volumes in North America, charges related to the agriculture solar business totaling $5.9 million, and realignment charges of $2.9 million.

Corporate SG&A decreased by 8.2% in fiscal 2025, as compared to fiscal 2024, primarily due to lower compensation and incentive costs.

This decrease was partially offset by higher professional services fees, insurance expenses, and technology costs.

In addition, during fiscal 2025, we incurred $4.9 million in realignment charges within Corporate expense.

KEY FACTORS AFFECTING FINANCIAL RESULTS

Acquisitions and Divestitures

Macroeconomic and Geopolitical Impacts on Financial Results and Liquidity

We continue to actively monitor a range of macroeconomic and geopolitical uncertainties that have affected, and may continue to affect, our business operations and financial performance.

These include volatility in the global economic and trade environment, inflationary cost pressures, supply chain disruptions, foreign currency fluctuations relative to the U.S.

dollar, changing interest rates, ongoing international conflicts, and labor shortages.

These factors may influence our operational costs, revenue streams, and overall financial stability.

As conditions evolve, we are proactively adjusting our business strategies to mitigate potential risks, maintain financial resilience, and ensure sufficient liquidity to support ongoing operations and strategic initiatives.

As of December 27, 2025, the consolidated backlog of unshipped orders was approximately $1.7 billion, as compared to approximately $1.4 billion as of December 28, 2024.

This increase is attributed to an increase in the Infrastructure segment partially offset by a decrease in the Agriculture segment.

LIQUIDITY AND CAPITAL RESOURCES

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We plan to allocate the remaining approximately 50% of operating cash flow to shareholder returns through the form of share repurchases and dividends.

We are committed to maintaining a capital structure that supports our investment-grade credit rating.

As of the latest assessments, our credit ratings were Baa2 (stable outlook) by Moody’s Investors Service, Inc., BBB- (stable outlook) by Fitch Ratings, Inc., and BBB+ (stable outlook) by S&P Global Ratings.

In February 2025, the Board of Directors increased the authorized capacity under our share repurchase program by $700.0 million, bringing the total authorization to $2.1 billion, with no stated expiration date.

We are not obligated to make repurchases and may discontinue the program at any time.

Any purchases will be funded through available liquidity and ongoing cash flows, and will be made subject to prevailing market and economic conditions.

As of December 27, 2025, we had approximately $567.0 million of remaining capacity under the share repurchase program.

Since the program’s inception in May 2014, we have repurchased approximately 8.8 million shares for a total of $1.5 billion.

Subsequent to year end, on February 23, 2026, the Board of Directors approved a quarterly cash dividend on common stock of $0.77 per share, or an annualized rate of $3.08 per share, representing an increase of approximately 13%.

We remain committed to maintaining a capital structure that supports our investment-grade credit rating.

As of the latest assessments, our credit ratings were Baa2 (stable outlook) by Moody’s Ratings and BBB+ (stable outlook) by S&P Global Ratings.

To support these ratings, we aim to manage our debt-to-invested capital ratio within levels that reinforce our investment-grade status.

As of December 28, 2024, we had approximately $66.0 million of remaining capacity under our share repurchase program.

Since May 2014, we have repurchased approximately 8.2 million shares for a total of $1,334.0 million under the program.

Subsequent to year end, on February 18, 2025, we announced the Board of Directors increased the program’s authorized capacity by an additional $700.0 million, with no stated expiration date.

These purchases will be funded through available cash balances and ongoing cash flows and will be made subject to market and economic conditions.

We are not obligated to make any repurchases and may discontinue the program at any time.

Additionally, the Board of Directors approved a quarterly cash dividend on common stock of $0.68 per share, or an annualized rate of $2.72 per share, representing an increase of over 13%.

Supplier Finance Program

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Revolving Credit Facility

Our revolving credit facility, managed by JPMorgan Chase Bank, N.A., as Administrative Agent, has a maturity date of October 18, 2026.

Our revolving credit facility, managed by JPMorgan Chase Bank, N.A., as Administrative Agent, has a maturity date of July 10, 2030.

The facility provides up to $800.0 million in unsecured revolving credit, with $400.0 million available for borrowings in foreign currencies.

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The interest rate on our borrowings will be, at our option, either:

(a) term Secured Overnight Financing Rate (“SOFR”), based on a one-, three-, or six-month period, plus a 10-basis-point adjustment and a spread of 100 to 162.5 basis points, depending on our senior unsecured long-term debt credit rating by S&P Global Ratings and Moody’s Investors Service, Inc.;

(a) term Secured Overnight Financing Rate (“SOFR”), based on a one-, three-, or six-month period, and a spread of 100 to 162.5 basis points, depending on our senior unsecured long-term debt credit rating by S&P Global Ratings and Moody’s Ratings;

(b) the higher of

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plus, in each case, 0 to 62.5 basis points, depending on our credit rating;

(c) daily simple SOFR plus a 10-basis-point adjustment and a spread of 100 to 162.5 basis points, depending on our credit rating.

Additionally, a commitment fee is applied to the average daily unused portion of the facility, ranging from 9 to 20 basis points, based on our credit rating.

As of December 27, 2025, we had $65.0 million of outstanding borrowings under this facility.

As of December 28, 2024, we had no outstanding borrowings under this facility.

As of December 30, 2023, we had outstanding borrowings of $377.9 million under this facility.

The facility includes a financial covenant that may limit

additional borrowing.

As of December 28, 2024, we could borrow $799.8 million under the facility, after accounting for $0.2 million in standby letters of credit related to certain insurance obligations.

Additionally, we maintain short‑term bank lines of credit totaling $30.9 million, with $29.2 million unused as of December 28, 2024.

The facility includes a financial covenant that may limit additional borrowing.

As of December 27, 2025, we could borrow an additional $734.8 million under the facility, after accounting for $0.2 million in standby letters of credit related to certain insurance obligations.

Additionally, we maintain short‑term bank lines of credit totaling $10.1 million, all of which were unused as of December 27, 2025.

Covenants and Compliance

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We may also pursue strategic investments, acquisitions, stock repurchases, or dividends, subject to market conditions and debt agreement restrictions.

In fiscal 2025, our primary cash requirements will include capital expenditures, pension contributions, lease payments, and interest on outstanding debt.

In fiscal 2026, our primary cash requirements will include capital expenditures, pension contributions, lease payments, and interest on outstanding debt, along with the payment of the mandatorily redeemable financial instrument related to the acquisition of the redeemable noncontrolling interest of ConcealFab, Inc.

We have committed to purchasing zinc, aluminum, and steel under unconditional purchase agreements aligned with our business needs.

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Pension plan contributions

Mandatorily redeemable financial instrument

Operating leases

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Distributions of this foreign cash would incur tax liabilities.

Additionally, as of December 28, 2024, we had liabilities of $1.6 million for foreign withholding taxes and $0.5 million for U.S.

As of December 27, 2025, we had liabilities of $2.2 million for foreign withholding taxes and $0.2 million for U.S.

state income taxes.

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Operating Cash Flows and Working Capital – Cash provided by operating activities totaled $456.5 million in fiscal 2025, compared to $572.7 million in fiscal 2024.

The change in operating cash flows reflects increased operating profits and favorable changes in working capital, mainly due to increased customer receipts, including deposits of $83.7 million from a large customer in fiscal 2024.

This was partially offset by a $21.9 million increase in tax payments for fiscal 2024, as compared to fiscal 2023.

Operating cash outflows for severance payments related to the Realignment Program totaled $12.5 million and $22.7 million for fiscal 2024 and 2023, respectively.

The change in operating cash flows was most notably impacted by the change in our contract liability due to the timing of large utility prepayments received in fiscal 2024 for work completed in fiscal 2025.

This was offset by lower income tax payments made in fiscal 2025 relative to fiscal 2024 largely as a result of our worthless securities deduction in addition to the tax provisions in the One Big Beautiful Bill Act.

Investing Cash Flows – Cash used in investing activities totaled $142.7 million in fiscal 2025, compared to $78.9 million in fiscal 2024.

Investing activities in fiscal 2024 included capital spending of $79.5 million partially offset by proceeds of $3.8 million from the divestitures of George Industries and the extractive business, net of cash divested.

Investing activities in fiscal 2023 included capital spending of $96.8 million and the acquisition of HR Products, net of cash acquired, of $32.7 million, partially offset by proceeds of $6.4 million from the divestiture of Torrent Engineering and Equipment Company, LLC, net of cash divested, and proceeds of $7.5 million from property damage insurance claims.

Investing activities in fiscal 2025 included capital spending of $145.0 million partially offset by proceeds of sales of assets of $2.2 million and proceeds from property damage insurance claims of $1.4 million.

Investing activities in fiscal 2024 included capital spending of $79.5 million partially offset by proceeds of $3.8 million from the

divestitures of George Industries and the extractive business, net of cash divested.

The increase in capital spending in fiscal 2025, as compared to fiscal 2024, was primarily to support future growth along with capacity investments for the Utility product line.

Financing Cash Flows – Cash used in financing activities totaled $298.9 million in fiscal 2025, compared to $522.6 million in fiscal 2024.

Our total interest‑bearing debt decreased to $757.9 million as of December 28, 2024, from $1,138.1 million as of December 30, 2023.

Our total interest‑bearing debt was $829.5 million as of December 27, 2025 and $757.9 million as of December 28, 2024.

Financing activities in fiscal 2025 included $218.6 million in borrowings on the revolving credit facility and short-term notes, offset by $156.1 million in principal payments on our long-term debt and short-term borrowings, $52.5 million in dividend payments, $198.1 million in stock repurchases, $101.8 million in purchases of redeemable noncontrolling interests, and $6.5 million in net activity from stock option and incentive plans, including related tax payments.

Financing activities in fiscal 2024 included $45.1 million in borrowings on the revolving credit facility and short-term notes, offset by $424.6 million in principal payments of on our long-term debt and short-term borrowings, $48.4 million in dividend payments, $70.1 million in stock repurchases, $17.8 million in purchases of redeemable noncontrolling interests, and $6.4 million in net activity from stock option and incentive plans, including related tax payments.

Financing activities in fiscal 2023 included $400.8 million in borrowings of on the revolving credit facility and short-term notes, offset by $168.8 million in principal payments of on our long-term debt and short-term borrowings, $49.5 million in dividend payments, $345.3 million in stock repurchases, and $12.9 million in net activity from stock option and incentive plans, including related tax payments.

Guarantor Summarized Financial Information

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Non-current liabilities

Redeemable noncontrolling interests

As of December 27, 2025 and December 28, 2024, non-current assets included a receivable from non-guarantor subsidiaries of $83,641 and $90,938, respectively.

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Selected Financial Measures

We are providing the following financial measures for the Company:

Return on Invested Capital – Return on invested capital (“ROIC”) and Adjusted ROIC are key operating ratios that enable investors to assess our operating performance relative to the investment needed to generate operating profit.

Return on Invested Capital

Return on invested capital (“ROIC”) and Adjusted ROIC are key operating ratios that enable investors to assess our operating performance relative to the investment needed to generate operating profit.

These measures are also utilized to determine management incentives.

ROIC is calculated by dividing after-tax operating income by the average of beginning and ending invested capital.

Adjusted ROIC is calculated as after-tax operating income, adjusted for certain non-recurring charges or gains.

Adjusted ROIC is calculated as after-tax operating income, adjusted for certain non-recurring

charges or gains.

The adjusted figure is then divided by the average of beginning and ending invested capital to determine Adjusted ROIC.

Invested capital represents total assets minus total liabilities (excluding interest-bearing debt and redeemable noncontrolling interests).

Invested capital represents total assets minus total liabilities (excluding mandatorily redeemable financial instrument, interest-bearing debt, and redeemable noncontrolling interests).

ROIC and Adjusted ROIC are non-generally accepted accounting principles (“GAAP”) measures.

As such, invested capital, ROIC, and Adjusted ROIC should not be considered in isolation or as substitutes for net earnings, cash flows from operations, or other income or cash flow data prepared in accordance with GAAP, nor should they be viewed as indicators of our operating performance or liquidity.

Additionally, ROIC and Adjusted ROIC, as presented, may not be directly comparable to similarly titled measures used by other companies.

The following table shows how invested capital, ROIC, and Adjusted ROIC are calculated from our Consolidated Statements of Earnings and our Consolidated Balance Sheets.

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Operating income

Effective tax rate

Tax effect on operating income

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Operating income

Impairment of goodwill and other intangible assets

Impairment of long-lived assets

Realignment charges

Other non-recurring charges

Prospera intangible asset amortization 3

Prospera stock-based compensation 3

Adjusted operating income

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Average invested capital

1 The adjusted effective tax rate for fiscal 2022 excluded the effects of the $33.3 million loss from the divestiture of the offshore wind energy structures business, which was not deductible for income tax purposes.

The effective tax rate including the loss on the divestiture was 29.9%.

2 The adjusted effective tax rate for fiscal 2023 excluded the effects of the impairment of goodwill and other intangible assets of $140.8 million, realignment charges of $35.2 million, non-recurring charges associated with major scope changes for two strategic projects initiated by departed senior leadership of $5.6 million, loss from Argentine peso hyperinflation of $5.1 million, and non-recurring tax benefit items of $3.6 million.

1 The adjusted effective tax rate for fiscal 2023 excluded the effects of the impairment of long-lived assets of $140.8 million, realignment charges of $35.2 million, non-recurring charges associated with major scope changes for two strategic projects initiated by departed senior leadership of $5.6 million, loss from Argentine peso hyperinflation of $5.1 million, and non-recurring tax benefit items of $3.6 million.

The effective tax rate including these items was 38.1%.

3 The Company does not include adjustments for the Prospera subsidiary non-cash expenses for fiscal 2023 or going forward, as these amounts are no longer financially significant after the third quarter of fiscal 2023 impairment of goodwill and other intangible assets and realignment activities completed during the fourth quarter of fiscal 2023.

ROIC and Adjusted ROIC, as presented, may not be directly comparable to similarly titled measures used by other companies.

Adjusted EBITDA – Adjusted EBITDA is a key financial metric we use to assess our maximum borrowing capacity.

Our bank credit agreements include a financial covenant that limits total interest-bearing debt to no more than 3.50 times Adjusted EBITDA (or 3.75 times Adjusted EBITDA following certain material acquisitions), calculated on a rolling four-fiscal-quarter basis.

These agreements permit the inclusion of estimated earnings before interest, taxes, depreciation, and

amortization (“EBITDA”) from acquired businesses for periods prior to ownership and the exclusion of EBITDA from divested businesses for periods during which we owned them.

Additionally, the agreements allow adjustments for non-cash stock-based compensation and non-recurring non-cash charges or gains, subject to certain limitations, which are factored into the calculation of Adjusted EBITDA.

Failure to comply with this financial covenant may result in higher financing costs or early debt repayment requirements.

As a non-GAAP measure, Adjusted EBITDA should not be considered in isolation or as a substitute for net earnings, cash flows from operations, or other income or cash flow data prepared in accordance with GAAP.

It also should not be interpreted as an indicator of operating performance or liquidity.

2 The adjusted effective tax rate for fiscal 2025 excluded the effects of the impairment of long-lived assets of $91.3 million, the worthless securities deduction and release of foreign tax credit valuation allowances totaling $78.5 million, realignment charges of $16.1 million (of which $0.7 million was included in cost of goods sold), and other non-recurring charges including costs to fulfill contractually required payments for system licenses no longer needed and asset valuation adjustments for a joint venture agriculture solar business totaling $14.9 million (of which $0.7 million was included in cost of goods sold).

The effective tax rate including these items was 6.3%.

Adjusted EBITDA and Leverage Ratio

The leverage ratio is a key financial metric we use to assess our maximum borrowing capacity.

It is defined as the ratio of (a) interest-bearing debt, minus unrestricted cash in excess of $50.0 million (but not exceeding $500.0 million), to (b) Adjusted EBITDA.

In the event of an acquisition or divestiture, Adjusted EBITDA is calculated on a pro forma basis, reflecting the transaction as if it had occurred on the first day of the period.

Our revolving credit facility requires us to maintain a leverage ratio of 3.50 or lower (or 3.75 or lower following certain material acquisitions) on a rolling four-fiscal-quarter basis, measured as of the last day of each fiscal quarter.

Failure to comply with this financial covenant may result in higher financing costs or early debt repayment obligations.

The leverage ratio and Adjusted EBITDA are non-GAAP measures.

As presented, these measures may not be directly comparable to similarly titled measures used by other companies.

They should not be considered in isolation or as a substitute for net earnings, cash flows from operations, or other income or cash flow data prepared in accordance with GAAP.

Additionally, they should not be interpreted as indicators of operating performance or liquidity.

The calculation of Adjusted EBITDA for the fiscal year ended December 27, 2025 was as follows:

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Income tax expense

Impairment of long-lived assets

Deferred income taxes

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Changes in assets and liabilities

Proforma divestitures adjustment

Impairment of long-lived assets

Realignment charges

Non-recurring non-cash charges

Adjusted EBITDA

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Stock-based compensation

Proforma divestitures adjustment

Impairment of long-lived assets

Realignment charges

Non-recurring non-cash charges

Adjusted EBITDA

Adjusted EBITDA, as presented, may not be directly comparable to similarly titled measures used by other companies.

Leverage Ratio – The leverage ratio is calculated by taking the sum of interest-bearing debt, minus unrestricted cash in excess of $50.0 million (but not exceeding $500.0 million), and dividing it by Adjusted EBITDA.

This ratio is a key component of the covenants in our major debt agreements, which stipulate that the ratio must not exceed 3.50 (or 3.75 after certain material acquisitions), calculated on a rolling four-fiscal-quarter basis.

If we violate these covenants, we could face increased financing costs or be required to repay debt before its maturity date.

As a non-GAAP measure, the leverage ratio should not be considered in isolation or as a substitute for net earnings, cash flows from operations, or other income or cash flow data prepared in accordance with GAAP.

It should not be interpreted as an indicator of our operating performance or liquidity.

The calculation of the leverage ratio as of December 27, 2025 was as follows:

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Leverage ratio

The leverage ratio, as presented, may not be directly comparable to similarly titled measures used by other companies.

Changes in Prices

We rely on certain key materials, including steel, aluminum, zinc, and natural gas, which are globally traded commodities.

We rely on certain key materials, including steel, aluminum, zinc, natural gas, and diesel fuel, which are globally traded commodities.

As a result, their prices fluctuate based on factors such as supply and demand shifts and the costs of steel‑making inputs.

These fluctuations can significantly impact our operating performance and cost of goods sold.

Additionally, recent trade policies and proposed tariffs could increase the cost of goods we and our suppliers purchase from Canada, China, and Mexico, potentially leading to higher manufacturing costs for Infrastructure structures.

Additionally, recent trade policies and tariffs could increase the cost of goods we and our suppliers purchase from Canada, China, and Mexico, potentially leading to higher manufacturing costs for Infrastructure structures.

Steel is particularly critical for our Utility product line, where it represents approximately 50% of net sales.

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For the fiscal year ended December 27, 2025, a hypothetical 20% change in steel prices could have impacted net sales in this product line by approximately $110.0 million, assuming a similar sales mix.

Similarly, natural gas prices have been highly volatile in recent years.

Natural gas prices have been highly volatile in recent years.

To manage these risks, we employ strategies such as implementing fixed-price purchase contracts with our vendors to stabilize our purchasing costs and raising sales prices where feasible.

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Interest Rate Risk:

As of December 28, 2024, most our interest‑bearing debt was fixed rate.

We have available to us a revolving credit facility, with no outstanding balance as of December 28, 2024.

As of December 27, 2025, most of our interest‑bearing debt was fixed rate.

We have available to us a revolving credit facility, with an outstanding balance of $65.0 million as of December 27, 2025.

Our notes payable, revolving credit facility, and a minor portion of our long-term debt accrue interest at variable rates.

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To manage these risks, we occasionally enter into foreign currency contracts.

As of December 28, 2024, the Company had one outstanding fixed-for-fixed cross currency swap (“CCS”) agreement.

This swap exchanges U.S.

dollar principal and interest payments on a portion of the Company’s 5.00% senior unsecured notes due in fiscal 2044 for euro-denominated payments.

The CCS was initiated in fiscal 2024 to mitigate foreign currency risk associated with our euro investments and to reduce interest expenses.

The notional amount of the euro CCS is $80.0 million, and it matures in fiscal 2029.

In the first quarter of fiscal 2024, the Company early settled a euro net investment hedge entered into during fiscal 2019, resulting in the Company receiving proceeds of $2.7 million.

In the third and fourth quarters of fiscal 2022, the Company settled a Danish krone net investment hedge entered into during fiscal 2019, resulting in the Company receiving proceeds of $3.5 million.

As of December 27, 2025, we had three outstanding fixed-for-fixed cross currency swap (“CCS”) agreements.

These swaps exchange U.S.

dollar principal and interest payments on a portion of our 5.00% senior unsecured notes due in fiscal 2044 for foreign-currency-denominated payments.

These CCSs were initiated in fiscal 2024 and fiscal 2025 to mitigate foreign currency risk associated with our foreign-currency-denominated investments and to reduce interest expenses.

In the first quarter of fiscal 2024, we early settled a euro net investment hedge entered into during fiscal 2019, resulting in us receiving proceeds of $2.7 million.

A significant portion of our cash in non-U.S.

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These contracts help manage variability in cash flows from future steel purchases.

As of December 28, 2024, we had open forward contracts and swaps with a notional amount of $13.5 million, covering the purchase of 17,000 short tons between January 2025 and September 2025.

As of December 27, 2025, we had open forward contracts and swaps with a notional amount of $6.2 million, covering the purchase of 7,250 short tons in December 2025.

Natural gas is another significant commodity used in our manufacturing processes, particularly in our Coatings product line, where it is used to heat tanks for the hot-dipped galvanizing process.

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These swaps are designed to reduce the impact of sudden and significant increases in natural gas prices on our earnings.

As of December 28, 2024, we had open natural gas swaps with a notional value of $1.4 million for 352,000 MMBtu from January 2025 to March 2026.

As of December 27, 2025, we had open natural gas swaps with a notional value of $0.8 million for 210,000 MMBtu from January 2026 to December 2026.

Diesel fuel is a major cost for our contracted carriers transporting our products.

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As of December 27, 2025, we had open option contracts with a notional amount of $8.3 million for the total purchase of 4,032,000 gallons of diesel fuel from December 2025 to June 2027.

Zinc is a critical input for our Coatings product line, where it is used in the hot-dipped galvanizing process.

Zinc prices can be volatile due to global supply and demand dynamics, energy costs, and commodity market speculation.

To mitigate the risk of rising zinc prices and manage variability in future cash flows, in fiscal 2025 we entered into forward contracts for zinc that qualified as cash flow hedges.

These contracts are intended to stabilize the cost of zinc used in our galvanizing operations.

As of December 27, 2025, we had open zinc forward contracts with a notional amount of $8.8 million, covering the purchase of 2,880 metric tons of zinc from January 2026 to December 2027.

CRITICAL ACCOUNTING ESTIMATES

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Management exercises substantial judgment in determining these estimates, which are essential to our financial reporting.

The key areas that involve such estimates include impairments of goodwill and other intangible assets, income taxes, revenue recognition for product lines recognized over time, and inventory obsolescence.

The key areas that involve such estimates include impairments of goodwill and other intangible assets, income taxes, revenue recognition for our Infrastructure product lines recognized over time, and inventory obsolescence.

These estimates are based on our past experiences and other assumptions that we believe to be reasonable given the circumstances.

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Depreciation and Amortization

Our long-lived assets include property, plant, and equipment, right-of-use assets, and goodwill and other intangible assets acquired through business acquisitions.

Our long-lived assets include property, plant, and equipment, right-of-use assets, and certain other intangible assets acquired through business acquisitions.

We assign useful lives to these assets based on their nature and expected usage, with ranges typically spanning from 3 to 30 years.

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We evaluate goodwill for impairment annually during the third fiscal quarter, aligning this assessment with our strategic planning process.

For the fiscal 2024 annual goodwill impairment test, we estimated the fair value of the twelve reporting units with recorded goodwill using a discounted cash flow model.

For the fiscal 2025 annual goodwill impairment test, we estimated the fair value of the eleven

reporting units with recorded goodwill using a discounted cash flow model.

This model factors in projected after-tax cash flows from operations, net of capital expenditures, discounted to their present value.

Additionally, we perform sensitivity analyses to assess the impact of changes in key assumptions, such as discount rates and cash flow forecasts, on the valuation of the reporting units.

For the fiscal 2025 annual impairment testing, no reporting units had a fair value lower than their carrying value.

However, in the second quarter of fiscal 2025, we identified triggering events that required interim goodwill impairment testing for certain reporting units within the Infrastructure segment, resulting in impairments totaling $64.9 million.

For fiscal 2024, no reporting units had a fair value lower than their carrying value.

However, in fiscal 2023, two reporting units had estimated fair values below their carrying values, resulting in impairments:

For fiscal 2023, two reporting units had estimated fair values below their carrying values, resulting in impairments:

$120.0 million for the Agriculture segment and $1.9 million for the Infrastructure segment.

Many of our reporting units serve cyclical markets, which can cause fluctuations in sales and profitability.

For our Solar and International Irrigation reporting units, which have a combined goodwill of approximately $130.0 million, the amount of cushion or excess fair value above their carrying values was less than 15%.

Despite this, we believe these reporting units will generate positive cash flows above their carrying values and will continue to monitor their performance and growth prospects.

Our reporting units are cyclical, and their sales and profitability may fluctuate from year to year.

For our APAC Highway Safety and EMEA Structures reporting units, with a combined goodwill of approximately $43.6 million, the amount of cushion or excess fair value above their carrying values was less than or approximately 15% as of the most recent impairment test.

In addition, our Access Systems reporting unit, with goodwill of approximately $9.5 million, had zero excess fair value over its carrying value following a goodwill impairment recorded during the second quarter of fiscal 2025.

We believe these reporting units will generate positive cash flows that meet or exceed their current carrying values, and we will continue to monitor their growth prospects and opportunities for continuous improvement.

The discount rate is a key assumption in our goodwill impairment analyses, as it reflects management’s assessment of the time value of money and the risks inherent in each reporting unit’s projected cash flows.

Based on the results of our fiscal 2025 annual impairment testing, the estimated fair value of each reporting unit exceeded its carrying value.

Management believes that a hypothetical increase of 50 basis points in the discount rate, considered in isolation, would not have resulted in an impairment for any reporting unit as of the testing date with the exception of the Access Systems reporting unit which would have had an incremental $2.7 million impairment.

However, changes in multiple assumptions simultaneously, or adverse changes in future operating performance or market conditions, could significantly impact the estimated fair values of our reporting units.

We actively monitor the global economy for potential factors that could impact the operating results of our reporting units.

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We use the relief-from-royalty method to value these assets, calculating the potential royalty a third party might pay to use the trade name, which is then discounted to present value and tax-effected.

For the fiscal 2025 annual impairment testing, the fair value of our trade names exceeded their carrying value.

However, in the second quarter of fiscal 2025, based upon an interim triggering event, we performed a test on certain indefinite-lived trade names and two trade names’ carrying values exceeded their fair values, resulting in a $4.8 million impairment within the Infrastructure segment.

For fiscal 2024, the fair value of our trade names exceeded their carrying value.

In fiscal 2023, however, one trade name’s carrying value exceeded its fair value, resulting in a $1.7 million impairment within the Infrastructure segment.

Additionally, in the third quarter of fiscal 2023, due to identified impairment indicators, we tested the recoverability of an amortizing proprietary technology intangible asset related to the Prospera subsidiary, which is part of the Agriculture segment.

For fiscal 2023, one trade name’s carrying value exceeded its fair value, resulting in a $1.7 million impairment within the Infrastructure segment.

Additionally, in the second quarter of fiscal 2025, due to identified impairment indicators, we tested the recoverability of an amortizing customer relationship intangible asset in the Agriculture segment.

We determined the asset’s carrying value exceeded its total undiscounted estimated future cash flows.

As a result, we recognized a $1.4 million impairment within the Agriculture segment.

Inventories are valued at the lower of cost, determined on a first-in, first-out basis, or net realizable value.

We assess the value of our inventory regularly and write down slow-moving or obsolete inventory.

The write-down is calculated as the difference between the carrying value and our estimate of the reduced value.

This estimate takes into account potential future uses of the inventory, the likelihood of selling overstocked inventory, and expected selling prices.

If our assumptions about the realizability of slow-moving or obsolete inventory prove to be overly optimistic, we may be required to record additional inventory write-downs.

Similarly, in the third quarter of fiscal 2023, due to identified impairment indicators, we tested the recoverability of an amortizing proprietary technology intangible asset related to the Prospera subsidiary, which is part of the Agriculture segment.

We determined the asset’s carrying value exceeded its total undiscounted estimated future cash flows.

As a result, we recognized a $17.3 million impairment within the Agriculture segment.

Inventories are valued at the lower of cost or net realizable value.

Cost is determined using either the first-in, first-out method or the weighted average cost method, depending on inventory management practices at each location.

We regularly assess the value of our inventory and record write-downs for slow-moving, obsolete, or excess inventory.

The amount of any write-down is calculated as the difference between the inventory’s carrying value and our estimate of its net realizable value.

These estimates consider, among other factors, potential future uses of the inventory, the likelihood of selling overstocked inventory, and expected selling prices.

If actual demand, market conditions, or realizability differ from our assumptions, additional inventory write-downs could be required, which could materially affect our results of operations.

We maintain valuation allowances to adjust deferred tax assets to amounts that we anticipate are more likely than not to be realized.

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As of December 27, 2025, we had approximately $59.3 million in deferred tax assets related to tax credits and loss carryforwards, with a valuation allowance of $30.4 million, including $7.6 million for capital loss carryforwards that are unlikely to be realized.

Changes in circumstance surrounding deferred tax assets may require adjustments to this allowance, which could impact income tax expense and net income.

In fiscal 2025, in an effort to simplify and align legal entity structure, we were able to generate additional foreign source income that allowed us to utilize certain foreign tax credits that previously had a full valuation allowance.

This resulted in a $13.4 million income tax benefit in fiscal 2025.

Additional changes in circumstance surrounding deferred tax assets may require adjustments to this allowance, which could impact income tax expense and net income in future periods.

Additionally, as the earnings of our non-U.S.

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Discrepancies between our estimates and actual outcomes in this area could impact our income tax expense in a given fiscal period.

Revenue Recognition

Revenue Recognition Over Time

Revenue recognition for our contracts is determined by analyzing the specific type, terms, and conditions of each contract with customers.

We do not have contracts that include variable consideration across any of our product lines.

For contracts involving Utility and certain Telecommunications customers, we recognize revenue over time.

Approximately $1.5 billion of revenue within the Infrastructure segment is recognized over time, which requires more judgment and estimation of expected costs to be incurred.

These contracts, particularly those for utility structures and telecommunication monopole structures, are engineered to meet customer specifications, making them unsuitable for alternative customers if canceled after production begins.

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For these products, revenue is recognized over time based on progress toward completion of the performance obligation.

However, for certain Telecommunications structures contracts where we lack the right to payment for work completed, revenue is instead recognized at the time of shipment.

The method for measuring progress toward completion requires judgment.

For our Utility and Telecommunications products, revenue is recognized using an input-based method, where total production hours incurred to date are measured as a percentage of the total estimated hours for the order.

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Our enterprise resource planning system tracks the total incurred costs and production hours to date, along with the estimated hours to complete.

Previously, our offshore wind energy structures business (divested in fiscal 2022) recognized revenue using the cost-to-cost measure of progress, which is based on the ratio of incurred costs to total estimated costs.

Management relies on assumptions and estimates regarding manufacturing labor, materials, overhead, and burden recovery rates at each production facility.

Production typically completes within three months once it begins, with profitability on open production orders reviewed monthly.

We apply the practical expedient to omit disclosures for performance obligations expected to be completed within one year.

Occasionally, Utility customer orders may require up to three years to complete, often due to the number of structures involved.

If actual costs deviate significantly from initial projections, burden rates and production hours per structure may be adjusted, recalibrating revenue recognition for future periods to reflect updated production schedules.

For our offshore wind energy structures business before divestiture, we updated the total cost estimates quarterly, with any changes reflected in the current period’s revenue.

During fiscal 2024, 2023, and 2022, no input or estimate adjustments were made that impacted revenue recognition for prior fiscal years.

During fiscal 2025, 2024, and 2023, no significant input or estimate adjustments were made that impacted revenue

recognition for prior fiscal years.

If a loss on a performance obligation is projected, a provision for loss is recognized, regardless of production status.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis