VALMONT INDUSTRIES INC 10-Q

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Valmont Industries, Inc., along with its subsidiaries (collectively referred to as the “Company,” “Valmont,” “we,” “us,” or “our”), is a diversified manufacturer of products and services for infrastructure and agriculture markets. Founded in 1946 and headquartered in Omaha, Nebraska, our purpose is to conserve resources and improve life. Forward-Looking Statements Management’s discussion and analysis contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements are based on assumptions that management has made in light of experience in the industries in which the Company operates, as well as management’s perceptions of historical trends, current conditions, anticipated future developments, and other factors deemed to be relevant. However, these statements are not guarantees of future performance or results. They are subject to risks, uncertainties (some beyond the Company’s control), and various assumptions. Management believes these forward-looking statements are based on reasonable assumptions. However, many factors could cause the actual financial results to differ materially from expectations. These factors include, among others, risk factors described in the Company’s reports to the Securities and Exchange Commission, as well as future economic and market conditions, industry trends, Company performance and financial results, operational efficiencies, availability and pricing of raw materials, availability and market acceptance of new products, product pricing, domestic and international competition, and actions or policy changes by domestic and foreign governments. This discussion should be read in conjunction with the financial statements and notes thereto, and the management’s discussion and analysis included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2025. Segment net sales in the following table and elsewhere are presented net of intersegment sales. See Note 14 of our Condensed Consolidated Financial Statements for additional information on segment sales and intersegment sales. 18 Table of Contents EXECUTIVE OVERVIEW Results of Operations ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen weeks ended ​ ​ ​ ​ March ​ ​ ​ March ​ Percent Dollars in thousands, except per-share amounts ​ 28, 2026 ​ 29, 2025 ​ Change Consolidated ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 1,029,197 ​ $ 969,314 ​ 6.2% Gross profit ​ ​ 316,878 ​ 291,102 ​ 8.9% as a percentage of net sales ​ ​ 30.8% ​ 30.0% ​ ​ Selling, general, and administrative expenses ​ ​ 161,252 ​ 162,788 ​ (0.9%) as a percentage of net sales ​ ​ 15.7% ​ 16.8% ​ ​ Operating income ​ ​ 155,626 ​ 128,314 ​ 21.3% as a percentage of net sales ​ ​ 15.1% ​ 13.2% ​ ​ Net interest expense ​ ​ 8,034 ​ 6,721 ​ 19.5% Effective tax rate ​ ​ 25.6% ​ 26.1% ​ ​ Net earnings attributable to Valmont Industries, Inc. ​ ​ 108,033 ​ ​ 87,261 ​ 23.8% Diluted earnings per share ​ $ 5.51 ​ $ 4.32 ​ 27.5% Infrastructure ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 803,180 ​ $ 703,491 ​ 14.2% Gross profit ​ 244,190 ​ ​ 212,875 ​ 14.7% as a percentage of net sales ​ ​ 30.4% ​ ​ 30.3% ​ ​ Selling, general, and administrative expenses ​ 101,167 ​ ​ 95,663 ​ 5.8% as a percentage of net sales ​ ​ 12.6% ​ ​ 13.6% ​ ​ Operating income ​ 143,023 ​ 117,212 ​ 22.0% as a percentage of net sales ​ ​ 17.8% ​ ​ 16.7% ​ ​ Agriculture ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 226,017 ​ $ 265,823 ​ (15.0%) Gross profit ​ 72,688 ​ ​ 78,227 ​ (7.1%) as a percentage of net sales ​ ​ 32.2% ​ ​ 29.4% ​ ​ Selling, general, and administrative expenses ​ 39,185 ​ ​ 41,990 ​ (6.7%) as a percentage of net sales ​ ​ 17.3% ​ ​ 15.8% ​ ​ Operating income ​ 33,503 ​ 36,237 ​ (7.5%) as a percentage of net sales ​ ​ 14.8% ​ ​ 13.6% ​ ​ Corporate ​ ​ ​ ​ ​ ​ Selling, general, and administrative expenses ​ $ 20,900 ​ $ 25,135 ​ (16.8%) Operating loss ​ (20,900) ​ (25,135) ​ (16.8%) ​ ​ Overview Consolidated net sales increased by $59.9 million or 6.2% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was primarily driven by higher net sales in the Infrastructure segment, particularly within the North America Utility product line, partially offset by lower net sales in the Agriculture segment. Consolidated gross profit increased by $25.8 million or 8.9% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was largely attributable to favorable pricing and higher sales volumes in the Infrastructure segment, particularly within the North America Utility product line, as well as higher average selling prices in North America in the Agriculture segment. These improvements were partially offset by lower sales volumes in the Agriculture segment, largely in the Middle East and Brazil. Consolidated selling, general, and administrative (“SG&A”) expenses decreased by $1.5 million or 0.9% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, driven mainly by lower compensation costs from reduced employee headcount, partially offset by increased incentive compensation resulting from improved performance in the North America Utility product line. Consolidated operating income increased by $27.3 million or 21.3% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was primarily due to improved pricing and higher sales volumes in the Infrastructure segment, partially offset by lower sales volumes in the Agriculture segment. 19 Table of Contents Income Tax Expense Our effective income tax rate in the first quarter of fiscal 2026 was 25.6%, as compared to 26.1% in the same period of fiscal 2025. The decrease in the effective tax rate was primarily attributable to a more favorable geographic mix of earnings. Infrastructure Segment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen weeks ended ​ ​ ​ ​ ​ ​ ​ March 28, ​ March 29, ​ Dollar ​ Percent Dollars in thousands ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ Change ​ ​ ​ Change North America Utility ​ $ 424,184 ​ $ 332,836 $ 91,348 27.4% North America Lighting and Transportation ​ ​ 118,652 ​ ​ 124,123 ​ (5,471) (4.4%) North America Coatings ​ ​ 63,134 ​ ​ 55,708 ​ 7,426 13.3% North America Telecommunications ​ ​ 61,504 ​ ​ 63,988 ​ (2,484) (3.9%) International Infrastructure and Solar ​ ​ 138,447 ​ ​ 129,566 ​ 8,881 6.9% Total sales ​ $ 805,921 ​ $ 706,221 ​ $ 99,700 14.1% ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income ​ $ 143,023 ​ $ 117,212 ​ $ 25,811 22.0% Infrastructure segment sales increased by $99.7 million or 14.1% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was driven by favorable pricing and higher sales volumes in the North America Utility product line, as well as increased volumes in the North America Coatings product line. These increases more than offset declines in the North America Lighting and Transportation (“L&T”) and North America Telecommunications product lines. Foreign currency translation favorably impacted the first quarter of fiscal 2026 results by approximately $12.0 million. North America Utility product line sales increased by $91.3 million or 27.4% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, reflecting favorable pricing and higher sales volumes. Demand remained strong, supported by increased electrical energy consumption and continued utility investment to expand and reinforce grid capacity, including to serve growing power demand from data centers and other sources of load growth. North America L&T product line sales decreased by $5.5 million or 4.4% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, driven by lower sales volumes resulting from certain operational challenges, partially offset by favorable pricing. North America Coatings product line sales increased by $7.4 million or 13.3% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, driven by favorable pricing and higher volumes, benefiting from continued strength in infrastructure-related and data center demand. North America Telecommunications product line sales decreased by $2.5 million or 3.9% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, primarily due to lower sales volumes associated with slightly lower carrier spending. International Infrastructure and Solar product line sales increased by $8.9 million or 6.9% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, largely due to favorable foreign currency translation impacts totaling approximately $11.3 million, partially offset by lower telecommunications sales volumes. Infrastructure segment gross profit increased by $31.3 million or 14.7% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, primarily due to favorable pricing and higher sales volumes in the North America Utility and the North America Coatings product lines. Infrastructure segment SG&A expenses increased by $5.5 million or 5.8% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was primarily driven by higher compensation and incentives costs. Infrastructure segment operating income increased by $25.8 million or 22.0% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was primarily attributable to higher pricing and sales volumes, along with an improved global cost structure. 20 Table of Contents Agriculture Segment ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen weeks ended ​ ​ ​ ​ ​ ​ ​ ​ ​ March 28, ​ March 29, ​ ​ ​ Dollar ​ ​ ​ Percent Dollars in thousands ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ Change ​ ​ ​ Change North America ​ $ 139,593 ​ $ 137,476 $ 2,117 1.5% International ​ ​ 87,403 ​ ​ 129,795 ​ (42,392) (32.7%) Total sales ​ $ 226,996 ​ $ 267,271 ​ $ (40,275) (15.1%) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income ​ $ 33,503 ​ $ 36,237 ​ $ (2,734) (7.5%) In North America, Agriculture segment sales increased by $2.1 million or 1.5% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The increase was primarily attributable to higher average selling prices, partially offset by lower irrigation equipment sales volumes, reflecting continued softness in the agriculture market. This softness was driven by lower grain prices, uncertainty surrounding trade policy, and the timing of government funding. In international markets, Agriculture segment sales decreased by $42.4 million or 32.7% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The decline was primarily driven by operational disruptions related to the Middle East conflict, as well as lower sales volumes in Brazil. These impacts were partially offset by favorable foreign currency translation of approximately $5.1 million during the first quarter of fiscal 2026. The Agriculture business is cyclical and influenced by factors including net farm income, commodity prices, weather volatility, geopolitical events, and farmer sentiment regarding future economic conditions. We closely monitor these variables across our key markets. In the U.S., net farm income estimates published by the U.S. Department of Agriculture are 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 availability, and purchasing behavior. Looking ahead, we remain focused on managing through evolving market conditions and positioning the Agriculture business for long-term growth across both domestic and international markets. Agriculture segment gross profit decreased by $5.5 million or 7.1% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The decrease primarily reflected lower sales volumes as a result of the Middle East conflict and continued market softness in North America, partially offset by higher average selling prices in North America. Additionally, as of March 28, 2026, our manufacturing facility in Dubai has remained idle leading to abnormal manufacturing variances in the first quarter of fiscal 2026. Agriculture segment SG&A decreased by $2.8 million or 6.7% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The decrease primarily reflected lower compensation costs. Agriculture segment operating income decreased by $2.7 million or 7.5% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025. The decline was primarily attributable to lower sales volumes, partially offset by reduced SG&A expenses. Corporate Corporate SG&A expenses decreased by $4.2 million or 16.8% in the first quarter of fiscal 2026, as compared to the same period of fiscal 2025, primarily due to lower compensation and technology costs, partially offset by higher incentive costs. KEY FACTORS AFFECTING FINANCIAL RESULTS 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 first quarter of fiscal 2026, we acquired the remaining 80% ownership interest in RMDS Innovation, Inc., a Quebec-based technology company, included in the Agriculture Segment. 21 Table of Contents 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. On February 28, 2026, the United States and Israel commenced military strikes against Iran, which has prompted Iranian retaliatory attacks throughout the broader Middle East region. We have agriculture operations headquartered in Dubai, United Arab Emirates, with business activities conducted in the Middle East. The ongoing conflict has affected, and may continue to adversely affect, our regional operations through disruptions to logistics networks and transportation infrastructure, increases in energy costs, and volatility in regional currency and financial markets. Certain of our customers and suppliers in the region may also be negatively impacted by these events. We continue to actively monitor the evolving situation and take appropriate actions to mitigate the impact on our operations, financial results, and liquidity. On April 2, 2026, a proclamation was issued modifying Section 232 tariffs on steel, aluminum, and certain derivative articles, effective April 6, 2026. Under the proclamation, tariffs on certain steel products, including utility poles, are determined based on sourcing requirements, with a 10% ad valorem rate applicable to products in which at least 95% of steel content was melted and poured in the U.S. Products that do not meet these requirements are subject to higher tariff rates, including up to 50% on full value. During fiscal 2025, we imported approximately $220.0 million of fabricated steel structures from Mexico into the U.S., which represents the primary category of products affected by these modifications. Based on our current assessment, we believe that the majority of our steel poles produced at our Mexico facility will qualify for the 10% tariff rate, as those structures are produced using U.S. melted and poured steel. Management has interpreted the requirements of the proclamation based on its current understanding and available guidance. Regulatory interpretations may evolve, and authorities could reach conclusions that differ from management’s interpretation. If such differing interpretations were to occur, the Company may be required to modify its practices, which could result in increased costs or changes to reported results. LIQUIDITY AND CAPITAL RESOURCES Capital Allocation Philosophy Our capital allocation priorities are intended to present a balanced approach to maintaining disciplined investments in organic and inorganic growth opportunities while delivering meaningful capital returns to shareholders over the next three to five years. These priorities are expected to be supported by our projected cash flow generation. We plan to allocate approximately 50% of operating cash flow to high-return growth opportunities, focused on: ● capital expenditures for strategic capacity expansion, primarily in the Infrastructure segment, to maintain and increase manufacturing output and efficiency while driving innovation to better serve customers, and ● acquisitions that strategically augment our competitive position, with a focus on sustainable growth and premium returns on invested capital. We plan to allocate the remaining approximately 50% of operating cash flow to shareholder returns through the form of share repurchases and dividends. 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 March 28, 2026, we had approximately $510.6 million of remaining capacity under the share repurchase program. Since the program’s inception in May 2014, we have repurchased approximately 9.0 million shares for a total of $1.6 billion. 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 22 Table of Contents Global Ratings. To support these ratings, we aim to manage our debt-to-invested capital ratio within levels that reinforce our investment-grade status. Supplier Finance Program We have established a supplier finance program with a financial institution, allowing qualifying suppliers the option to sell their receivables from us to the financial institution under independently negotiated terms. Participation in the program is entirely voluntary for suppliers and does not affect our payment terms, amounts, timing, or liquidity. We have no economic interest in a supplier’s decision to participate. As of March 28, 2026 and December 27, 2025, our accounts payable in the Condensed Consolidated Balance Sheets included $56.4 million and $56.3 million, respectively, related to the obligations under this program. Sources of Financing As of March 28, 2026, our available debt financing primarily included senior unsecured notes and a revolving credit facility. Senior Unsecured Notes As of March 28, 2026, our senior unsecured notes consisted of: ● $450.0 million face value ($434.7 million carrying value) notes at an interest rate of 5.00% per annum, maturing in October 2044. ● $305.0 million face value ($295.6 million carrying value) notes at an interest rate of 5.25% per annum, maturing in October 2054. We retain the option to repurchase these notes by paying a make-whole premium. Both tranches are guaranteed by certain subsidiaries. Revolving Credit Facility 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. An additional $400.0 million may be added to the facility, subject to lender commitments. Authorized borrowers include the Company and its wholly owned subsidiaries, Valmont Industries Holland B.V. and Valmont Group Pty. Ltd. Obligations under this facility are guaranteed by the Company and its wholly owned subsidiaries, Valmont Telecommunications, Inc., Valmont Coatings, Inc., Valmont Newmark, Inc., and Valmont Queensland Pty. Ltd. 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, 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 ● the prime lending rate, ● the overnight bank rate plus 50 basis points, or ● term SOFR (based on a one-month period) plus 100 basis points, plus, in each case, 0 to 62.5 basis points, depending on our credit rating; or (c) daily simple SOFR 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. 23 Table of Contents As of March 28, 2026 and December 27, 2025, we had outstanding borrowings of $60.0 million and $65.0 million, respectively, under this facility. The facility includes a financial covenant that may limit additional borrowing. As of March 28, 2026, we could borrow $739.8 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 $9.8 million, all of which were unused as of March 28, 2026. Covenants and Compliance Both our senior unsecured notes and revolving credit facility contain cross-default provisions, which allow for the acceleration of debt if we default on other indebtedness that also permits acceleration. The revolving credit facility requires us to maintain a financial leverage ratio of 3.50 or lower, measured as of the last day of each fiscal quarter. A temporary increase to 3.75 is permitted for the four fiscal quarters following a material acquisition. The leverage ratio 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) earnings before interest, taxes, depreciation, and amortization, adjusted for non-cash stock-based compensation and non-recurring non-cash charges or gains, subject to certain limitations (“Adjusted EBITDA”). Additionally, 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. Additional covenants restrict activities such as incurring indebtedness, placing liens, engaging in mergers, making investments, selling assets, paying dividends, conducting affiliate transactions, and making debt prepayments. Customary events of default may trigger the acceleration of obligations, subject to grace periods where applicable. As of March 28, 2026, we were in compliance with all covenants related to these debt agreements. For detailed calculations of Adjusted EBITDA and the leverage ratio, please refer to the “Selected Financial Measures” section. Cash Uses Our primary cash needs include working capital, capital expenditures, debt service, taxes, and pension contributions. We may also pursue strategic investments, acquisitions, stock repurchases, or dividends, subject to market conditions and debt agreement restrictions. Our business operates in cyclical markets, but our diverse portfolio—spanning various products, customers, and regions—has enabled us to navigate these cycles effectively while maintaining liquidity. Historically, we have consistently generated operating cash flows that exceed our capital expenditures, demonstrating our ability to manage cash effectively through economic cycles. For fiscal 2026 and beyond, we are confident in our liquidity position, supported by accessible credit facilities, capital markets, and a solid track record of positive operating cash flows. As of March 28, 2026, we held $160.2 million in cash, including $132.3 million in non-U.S. subsidiaries. Distributions of this foreign cash would incur tax liabilities. As of March 28, 2026, we had liabilities of $2.5 million for foreign withholding taxes and $0.2 million for U.S. state income taxes. We expect fiscal 2026 capital expenditures to range from $170.0 million to $200.0 million. Cash Flows The table below summarizes our cash flow information for the thirteen weeks ended March 28, 2026 and March 29, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen weeks ended ​ ​ March 28, ​ March 29, Dollars in thousands ​ ​ ​ 2026 ​ ​ ​ 2025 Net cash flows from operating activities ​ $ 103,473 ​ $ 65,130 Net cash flows from investing activities ​ (43,301) ​ (30,191) Net cash flows from financing activities ​ (87,225) ​ (16,993) Operating Cash Flows and Working Capital – Cash provided by operating activities totaled $103.5 million in the first quarter of fiscal 2026, as compared to $65.1 million in the same period of fiscal 2025. The change in operating cash 24 Table of Contents flows reflects higher operating income in addition to a lower incentive compensation bonus payout in fiscal 2026 relative to fiscal 2025. Investing Cash Flows – Cash used in investing activities totaled $43.3 million in the first quarter of fiscal 2026, as compared to $30.2 million in the same period of fiscal 2025. Investing activities in the first quarter of fiscal 2026 primarily included capital spending of $34.6 million and the acquisition of RMDS Innovations, Inc., net of cash acquired, of $11.2 million. Investing activities in the first quarter of fiscal 2025 primarily included capital spending of $30.3 million. Financing Cash Flows – Cash used in financing activities totaled $87.2 million in the first quarter of fiscal 2026, as compared to $17.0 million in the same period of fiscal 2025. Our total interest-bearing debt was $815.0 million as of March 28, 2026 and $829.5 million as of December 27, 2025. Financing activities in the first quarter of fiscal 2026 primarily consisted of borrowings on the revolving credit facility of $50.0 million offset by payments of $55.6 million, dividends paid of $13.3 million, stock repurchases of $57.6 million, the purchase of a redeemable noncontrolling interest of $8.9 million, and the net activity from stock option and incentive plans, including the associated withholding payments, of $1.9 million. Financing activities in the first quarter of fiscal 2025 primarily consisted of borrowings on the revolving credit facility and short-term notes of $62.8 million, offset by principal payments on our long-term debt and short-term borrowings of $64.6 million, dividends paid of $12.0 million, and the net activity from stock option and incentive plans, including the associated withholding payments, of $3.5 million. Guarantor Summarized Financial Information This information is provided in compliance with Rule 3-10 and Rule 13-01 of Regulation S-X, relating to our two tranches of senior unsecured notes. These senior notes are jointly, severally, fully, and unconditionally guaranteed—subject to certain customary release provisions, including the sale of the subsidiary guarantor or of all or substantially all of its assets—by certain of our current and future direct and indirect domestic and foreign subsidiaries (collectively, the “Guarantors”). The Parent serves as the Issuer of the notes and consolidates all Guarantors. The financial information for the Issuer and Guarantors is presented on a combined basis, with intercompany balances and transactions between the Issuer and the Guarantors eliminated. Any amounts due to or from the Issuer or Guarantors, as well as transactions with non-guarantor subsidiaries, are disclosed separately. The combined financial information for the thirteen weeks ended March 28, 2026 and March 29, 2025 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Thirteen weeks ended ​ ​ March 28, ​ March 29, Dollars in thousands ​ ​ ​ 2026 ​ 2025 Net sales ​ $ 778,496 ​ $ 676,691 Gross profit ​ 228,408 ​ 199,145 Operating income ​ 125,133 ​ 92,995 Net earnings attributable to Valmont Industries, Inc. ​ 81,355 ​ 59,986 The combined financial information as of March 28, 2026 and December 27, 2025 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 28, ​ December 27, Dollars in thousands ​ 2026 ​ ​ ​ 2025 Current assets ​ $ 955,648 ​ $ 901,456 Non-current assets ​ 841,541 ​ 851,743 Current liabilities ​ 402,917 ​ 415,155 Non-current liabilities ​ 1,279,858 ​ 1,241,800 As of March 28, 2026 and December 27, 2025, non-current assets included a receivable from non-guarantor subsidiaries of $77,603 and $83,641, respectively. As of March 28, 2026 and December 27, 2025, non-current liabilities included a payable to non-guarantor subsidiaries of $368,414 and $325,225, respectively. Selected Financial Measures 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) 25 Table of Contents 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-generally accepted accounting principles (“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 four fiscal quarters ended March 28, 2026 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ Four fiscal quarters ended ​ ​ March 28, Dollars in thousands ​ 2026 Net cash flows from operating activities ​ $ 494,827 Interest expense ​ 39,838 Income tax expense ​ 30,180 Impairment of long-lived assets ​ ​ (91,337) Deferred income taxes ​ 13,968 Redeemable noncontrolling interests ​ (4,004) Net periodic pension cost ​ (1,873) Contribution to defined benefit pension plan ​ 2,553 Changes in assets and liabilities ​ 70,920 Other, net ​ (1,782) Impairment of long-lived assets ​ ​ 91,337 Realignment charges ​ ​ 16,066 Non-recurring non-cash charges ​ ​ 3,918 Pro forma acquisition adjustment ​ ​ 6,424 Adjusted EBITDA ​ $ 671,035 ​ ​ ​ ​ ​ ​ ​ Four fiscal quarters ended ​ ​ March 28, Dollars in thousands ​ 2026 Net earnings attributable to Valmont Industries, Inc. ​ $ 371,045 Interest expense ​ 39,838 Income tax expense ​ 30,180 Depreciation and amortization ​ 89,598 Stock-based compensation ​ 22,629 Impairment of long-lived assets ​ ​ 91,337 Realignment charges ​ ​ 16,066 Non-recurring non-cash charges ​ ​ 3,918 Pro forma acquisition adjustment ​ ​ 6,424 Adjusted EBITDA ​ $ 671,035 The calculation of the leverage ratio as of March 28, 2026 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ March 28, Dollars in thousands ​ 2026 Interest-bearing debt, excluding origination fees and discounts of $24,708 ​ $ 815,000 Less: Cash and cash equivalents in excess of $50,000 ​ 110,189 Net indebtedness ​ $ 704,811 Adjusted EBITDA ​ 671,035 Leverage ratio ​ 1.05 26 Table of Contents FINANCIAL OBLIGATIONS AND COMMITMENTS There were no material changes in the Company’s financial obligations and commitments during the thirteen weeks ended March 28, 2026. For additional information on the Company’s financial obligations and commitments, refer to the “Cash Uses” section in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2025. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK There were no material changes in the Company’s market risk during the thirteen weeks ended March 28, 2026. For additional information on the Company’s market risk, refer to Part II, Item 7A of the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2025.