AP 10-K & 10-Q changes, risk factors and insider trading
Ampco Pittsburgh Corp. · NYSE · Pumps & Pumping Equipment · CIK 6176 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “We may from time to time undertake internal corporate reorganizations that may adversely impact our business and results of operations.”
New heading “A reduction in the level of our export sales, changes in foreign currency exchange rates as well as other economic factors in foreign countries could have an adverse impact on our financial results.”
New heading “The imposition of tariffs by the United States and other governments has negatively affected, and could again negatively affect, our operations, financial performance and liquidity.”
New heading “Increases in energy and commodity prices, reductions in electricity and natural gas supply, or shortages of key production materials could adversely impact our production, which could result in lower profitability or higher losses.”
New heading “We are a party to sale-leaseback financing transactions, which creates the risk of loss if we default. If we fail to comply with the covenants as required by our various debt agreements, including our revolving credit facility, it may adversely affect our liquidity, results of operations and financial condition.”
New heading “Certain of ALP's customers are suppliers to the U.S. government. Changes in U.S. government priorities, or delays or reductions in U.S. government spending, could have a material adverse effect on our customers' business and, therefore, on our business.”
Removed heading “Increases in energy and commodity prices, reductions in electricity and natural gas supply or shortages of key production materials could adversely impact our production, which could result in lower profitability or higher losses.”
Removed heading “A reduction in the level of our export sales, as well as other economic factors in foreign countries, could have an adverse impact on our financial results.”
Removed heading “We are a party to sale-leaseback financing transactions, which creates the risk of loss if we default.”
Removed heading “Holders of Series A warrants will have no rights as holders of our common stock until they exercise their Series A warrants and acquire our common stock.”
Removed heading “The market price of our common stock may not exceed the exercise price of the Series A warrants at such time as the holder desires to exercise such Series A warrants and, accordingly, the Series A warrants may have no value.”
Removed heading “Because the Series A warrants are executory contracts, they may have no value in a bankruptcy or reorganization proceeding.”
Largest changes
“We are a party to sale-leaseback financing transactions, which creates the risk of loss if we default. If we fail to comply with the covenants as required by our various debt agreements, including our revolving credit facility, it may adversely affect our liquidity, results of operations and financial condition.”see in full comparison
“The imposition of tariffs by the United States and other governments has negatively affected, and could again negatively affect, our operations, financial performance and liquidity.”see in full comparison
“Because the Series A warrants are executory contracts, they may have no value in a bankruptcy or reorganization proceeding.”see in full comparison
“We are a party to sale-leaseback financing transactions, which creates the risk of loss if we default.”see in full comparison
We need to maintain adequate liquidity to meet our operating cash flow requirements, debt servicesee in full comparisoncostscosts, net asbestos payments, and other financial obligations.If we fail to comply with the covenants contained in our revolving credit facility or our equipment financing facility, it may adversely affect our liquidity, results of operations and financial condition.
“Exports are a significant portion of our sales. Historically, changes in foreign exchange rates, particularly in respect of the U.S. dollar, British pound, Swedish krona, and euro, have impacted the export of our products and may do so again in the future. Sales for certain of our subsidiaries are negotiated in a currency other than the subsidiary's functional (local) currency. …”see in full comparison
Full comparison: every changed paragraph (59)
RISKS RELATEFDRELATED TO OUR BUSINESS AND INDUSTRY
We need to maintain adequate liquidity to meet our operating cash flow requirements, debt service costscosts, net asbestos payments, and other financial obligations. If we fail to comply with the covenants contained in our revolving credit facility or our equipment financing facility, it may adversely affect our liquidity, results of operations and financial condition.
Our liquidity is a function of our cash on-hand, our ability to successfully generate cash flows from a combination of efficient operations and continuing operating improvements, availability from our revolving credit facility, access to capital markets, and funding from other third parties. We believe our liquidity (including operating and other cash flows that we expect to generate and advances under our revolving credit availability) should be sufficient to meet our operating cash flow requirements, debt service costscosts, net asbestos payments, and other financial obligations as they occur;occur. however, ourOur ability to maintain sufficient liquidity going forwardforward, in part, is subject to the general liquidity of, and ongoing changes in, the credit markets as well as general economic, financial, competitive, legislative, regulatory, and other market factors that are beyond our control. If we are not able to maintain adequate liquidity, we may not be able to meet our operating cash flow requirements, debt service costs, net asbestos payments, or other financial obligations such as future required contributions to our employee benefit plans.obligations.
The maturity date for our revolving credit facility is June 29, 2026 and, subject to other terms and conditions of the agreement, would become due on that date. In addition, our revolving credit facility is subject to various affirmative and negative covenants and our equipment financing facility includes various affirmative covenants. Failure to extend or replace the revolving credit facility or failure to comply with material provisions or covenants in these facilities could have a material adverse effect on our liquidity, results of operations and financial condition. We may seek to renegotiate or replace a facility or may determine not to replace a facility at all and, instead, pursue other forms of liquidity. Any new credit agreement or other forms of liquidity may result in higher borrowing costs and contain non-investment grade covenants that are less favorable in comparison to our existing revolving credit and equipment financing facilities, if available at all.
A significant portion of the FCEP segment’s sales consists of mill rolls to customers in the global steel and aluminum industries that may be periodically impacted by economic or cyclical downturns and other disruptions. Such downturns and disruptions, the timing and length of which are difficult to predict, may cause demand for steel and aluminum to be lower than forecasted which may reduce the demand for, and sales of, our forged and cast rolls both in the United States and the rest of the world. Lower demand for rolls may also adversely impact profitability as other competing roll producers lower selling prices in the marketplace to fill their manufacturing capacity. Cancellation of orders or deferral of roll delivery of rolls may occur and produce an adverse impact on our financial results. In addition, sales of FEP, specifically open-die forged products for the oil and gas industry and steel distribution markets, are impacted by fluctuations in global energy demand, which also could adversely affect our margins and profitability.
The global steel manufacturing capacity continues to exceed global consumption of steel products. Such excess capacity often results in manufacturers in certain countries exporting steel at prices significantly below their home market prices (often due to local government assistance or subsidies). Increased entry of low-priced products from other countries has negatively impacted, and may continue to negatively impact, local demand in the United States and Europe. This could lead to global market destabilization and reduced sales and profitability offor some of our customers which, in turn, affectscould affect our sales and profit margins,margins as well as the collectability of our receivables and the salability of our in-process inventory. Excess capacity in the global roll industry and cyclicality in end-market demand also pose risks of potential impairment of our long-lived assets, which could be material to our results of operations and the carrying value of our assets.
We periodically evaluate our segments and continue to undertake restructuring and realignment initiatives to reduce our overall cost basis and improve efficiency by pursuing a variety of strategies including, without limitation, optimizing our operations in our physical footprint, disposing of certain assetsassets, and pursuing opportunities that are accretive to our operating results. There can be no assurance we will fully realize the benefits of such efforts as anticipated, and we may incur additional and/or unexpected costs to realize them. These actions could yield other unintended consequences, such as distraction of management and employees, business disruption, reduced employee morale and productivity, and unexpected employee attrition,attrition including the inability to attract or retain key personnel. If we fail to achieve the expected benefits of any restructuring or realignment initiatives and improvement efforts, or if other unforeseen events occur in conjunction with such efforts, our business, results of operations, financial condition and liquidity could be negatively impacted.
We may from time to time undertake internal corporate reorganizations that may adversely impact our business and results of operations.
From time to time, we have undertaken, and may undertake again, internal corporate reorganizations in an effort to simplify our organizational structure, streamline our operations or address other operational factors. Such internal reorganization involves and may involve, among other things, the combination or dissolution of certain of our existing subsidiaries, including legal insolvency proceedings, and the creation of new subsidiaries. These transactions could be disruptive to our business, result in significant expense, require regulatory approvals, or fail to result in the intended or expected benefits, any of which could adversely impact our business and results of operations.
Demand for our products, particularly in our ALP segment, may grow at a pace that exceeds our operational capacity, including our manufacturing capabilities. We may be required to expand our facilities, contract with third parties or acquire additional equipment to meet such growth, which we may not be able to do in a timely manner, if at all. If we are required to expand our facilities, contract with third parties or acquire additional equipment to meet growth in client demand, we may not have access to sufficient capital resources to expand in a timely manner, if at all. As a result, we may not be able to maximize sales growth and, therefore, could lose opportunities to produce additional revenue.
We are parties to a senior secured asset-based revolving credit facility with a consortium of banks. The revolving credit facility is collateralized by a first priority perfected security interest in substantially all of our assets. The revolving credit facility provides for borrowings not to exceed $100 million and otherwise restricts us from incurring additional indebtedness outside of the agreement, unless approved by the lenders party to the revolving credit facility. The revolving credit facility is subject to various affirmative and negative covenants and contains various sub-limits, including those based on the type of collateral and borrowings by geographic region. If the financial covenants become difficult to meet or if we need to increase our borrowing needs increaseborrowings beyond the prescribed limits, our financial position, results of operations and liquidity may be materially adversely affected. In addition, changes in our credit profile could cause less favorable commercial terms for the procurement of materials required to manufacture our products, which also could have a negative impact on our financial position, results of operations and liquidity. Further, our access to public and private capital markets is limited based on our size, credit profile and not being a well-known seasoned issuer, which may result in limitations in availability of capital to fund our strategic plans. If we are unable to fund our strategic plans, whether through cash from operationsoperations, availability from our revolving credit facility or proceeds from the capital markets, we may have to forego opportunities that would otherwise be accretive to our operating results for potentially an extended period.
A reduction in the level of our export sales, changes in foreign currency exchange rates as well as other economic factors in foreign countries could have an adverse impact on our financial results.
Exports are a significant portion of our sales. Historically, changes in foreign exchange rates, particularly in respect of the U.S. dollar, British pound, Swedish krona, and euro, have impacted the export of our products and may do so again in the future. Sales for certain of our subsidiaries are negotiated in a currency other than the subsidiary's functional (local) currency. Changes in a foreign exchange rate from the time of an order to the time of shipment have impacted the value of our recorded sales and may do so again in the future, and we may not be able to effectively hedge against such fluctuations. Other factors that may adversely impact our export sales and our operating results include political and economic instability, export controls, changes in tax laws and tariffs, and new producers in overseas markets. A reduction in the level of our export sales and changes in foreign currency exchange rates may have an adverse impact on our financial results. In addition, changes in foreign currency exchange rates may provide foreign roll suppliers with advantages based on those lower foreign currency exchange rates and, therefore, permit them to compete in our home markets.
Certain of our subsidiaries operate in foreign jurisdictions and, accordingly, earn revenues, pay expenses, own assets, and incur liabilities in countries using currencies other than the U.S. dollar. Since our consolidated financial statements are presented in U.S. dollars, we must translate revenues and expenses into U.S. dollars at the average exchange rate during each reporting period and assets and liabilities into U.S. dollars at the exchange rate in effect at the end of each reporting period. Therefore, increases or decreases in the value of the U.S. dollar against other major currencies, or any failure by the Corporation to effectively hedge against unfavorable fluctuations, will affect the translated value for revenue, expenses and balance sheet items denominated in foreign currencies and could materially affect our financial results expressed in U.S. dollars.
The imposition of tariffs by the United States and other governments has negatively affected, and could again negatively affect, our operations, financial performance and liquidity.
The United States currently imposes tariffs on primary steel, aluminum and coated steel imports into the United States, has expanded tariffs to other imported products, and has removed exceptions allowing certain countries to send un-tariffed products to the United States. Other governments, including the European Union, have announced tariffs on steel imports or may do so in the future. As a result, tariffs are now incurred on forged and cast rolls shipped from the FCEP segment's European facilities into the United States and on U.S. forged and cast rolls shipped into China.
For a period of time in 2025, while tariffs were being negotiated and mechanisms to calculate the tariffs were under consideration, customer orders in the United States, Europe and China were slowed as pricing could not be understood. While end-market demand in the United States started to improve and order intake began to stabilize in the second half of 2025, demand in Europe continued to falter. During 2025, tariffs on steel product have, but may not continue to be, a tailwind for the segment's FEP products resulting in increased order volumes.
Additional tariffs or changes in tariffs could result in a slowing of customer orders again. During 2025, we were able to pass on the incremental tariff expense to the vast majority of our customers, which we may or may not be able to do in the future. Similarly, additional tariffs, changes in tariffs, or other changes in U.S. and foreign government trade policy may trigger retaliatory actions by affected countries, which could adversely impact demand for our products, as well as impact our costs, customers, suppliers, and/or the U.S. and global economy or certain sectors thereof and, thus, may adversely impact our business, operations and financial performance. Our financial condition, results of operations and liquidity may be affected by these tariffs, or similar actions.
Increases in energy and commodity prices, reductions in electricity and natural gas supply, or shortages of key production materials could adversely impact our production, which could result in lower profitability or higher losses.
Our subsidiaries use certain commodities in the manufacture of their products. These include steel scrap, ferroalloys and energy. The FCEP segment has fixed pricing for a portion of its estimated electricity and natural gas usage. The ALP segment has fixed pricing for a portion of its estimated aluminum usage. However, any unexpected, sudden or prolonged increase in the price of these commodities may cause a reduction in our profit margins or result in losses where beneficial fixed-priced contracts do not exist for sufficient supply, unfavorable fixed-priced contracts cannot be modified, or increases cannot be obtained in our selling prices.
In addition, there could be a time lag between when we incur such price increases and when we are able to recover such increases in our selling prices. Global increases in transportation costs and more limited availability of freight carriers may impact timely delivery of supplies to our subsidiaries and product to our customers, and may negatively impact our sales, production and profitability. Changes in our credit profile could cause less favorable commercial terms for the procurement of materials required to manufacture our products, which also could have a negative impact on our financial position, results of operations and liquidity. There also may be curtailment in electricity or natural gas supply or availability of key production materials, which could adversely impact our production or result in lower profitability, higher losses or impairment of our long-lived assets. Shortage of key production materials, while driving up costs, may be of such severity as to disrupt our production, all of which may impact our sales and profitability. Geopolitical factors or wars could exacerbate the above risks.
We are a party to sale-leaseback financing transactions, which creates the risk of loss if we default. If we fail to comply with the covenants as required by our various debt agreements, including our revolving credit facility, it may adversely affect our liquidity, results of operations and financial condition.
The maturity date for the revolving credit facility is June 25, 2030 and, subject to other terms and conditions of the agreement, would become due on that date. Failure to comply with material provisions or covenants in this facility and our other debt agreements could have a material adverse effect on our liquidity, results of operations and financial condition. We may seek to renegotiate or replace a facility or may determine not to replace a facility at all and, instead, pursue other forms of liquidity. Any new credit agreement or other forms of liquidity may result in higher borrowing costs and contain non-investment grade covenants that are less favorable in comparison to our existing revolving credit and other debt facilities, if available at all.
Increases in energy and commodity prices, reductions in electricity and natural gas supply or shortages of key production materials could adversely impact our production, which could result in lower profitability or higher losses.
Our subsidiaries use certain commodities in the manufacture of their products. These include steel scrap, ferroalloys and energy. Any unexpected, sudden or prolonged increase in the price of these commodities may cause a reduction in our profit margins or result in losses where beneficial fixed-priced contracts do not exist, unfavorable fixed-priced contracts cannot be modified or increases cannot be obtained in our selling prices. In addition, there could be a time lag between when we incur such price increases and when we are able to recover such increases in our selling prices. Global increases in transportation costs and more limited availability of freight carriers may impact timely delivery of supplies to our subsidiaries and product to our customers, and may negatively impact our sales, production and profitability. There also may be curtailment in electricity or natural gas supply or availability of key production materials, which could adversely impact our production or result in lower profitability, higher losses or impairment of our long-lived assets. Shortage of key production materials, while driving up costs, may be of such severity as to disrupt our production, all of which may impact our sales and profitability.
Geopolitical factors or wars, including the Russia-Ukraine and Middle East conflicts, could exacerbate the above risks. In particular, the Russia-Ukraine conflict has significantly increased the cost of energy for our U.K. operations. As a result, we have moved certain of our cast roll production from the U.K. to Sweden, reducing profitability of our U.K. operations but improving profitability for our Sweden operations.
Certain of our subsidiaries operate in foreign jurisdictions and, accordingly, earn revenues, pay expenses, own assets, and incur liabilities in countries using currencies other than the U.S. dollar. Since our consolidated financial statements are presented in U.S. dollars, we must translate revenues and expenses into U.S. dollars at the average exchange rate during each reporting period and assets and liabilities into U.S. dollars at the exchange rate in effect at the end of each reporting period. Therefore, increases or decreases in the value of the U.S. dollar against other major currencies will affect the translated value for revenue, expenses and balance sheet items denominated in foreign currencies and could materially affect our financial results expressed in U.S. dollars.
We are subject to a wide variety of complex domestic and foreign laws, rules and regulations, including trade policies and tax regimes. We are affected by new laws and regulations and changes to existing laws and regulations, including interpretations by the courts and regulators, whether prompted by changes in government administrations or otherwise. These laws, regulations and policies, and changes thereto, may result in restrictions or limitations to our current operational practices and processes and our product/service offerings which could negatively impact our current cost structure, revenue streams, future tax obligations, the value of our deferred income tax assets, cash flows, and overall financial position.
In addition, our tax filings are subject to audits by tax authorities in the various jurisdictions in which we do business. These audits may result in assessments of additional taxes that are subsequently resolved with the taxing authorities or through the courts. Currently, we believe there are no outstanding assessments whose resolution would result in a material adverse financial result. However, there can be no assurance that unasserted or potential future assessments would not have a material adverse effect on our financial condition, results of operations and liquidity.
The United States currently imposes tariffs on primary steel and aluminum imports into the United States. As consumers of steel and aluminum in some of our products, our cost base is exposed to these tariffs and could be exposed to additional tariffs, higher tariffs or similar actions in the future, which could reduce our margins. Similarly, we could potentially lose market share to foreign competitors not subject to similar tariffs if our foreign customers sourced product offshore. Our financial condition, results of operations and liquidity may be affected by these tariffs, or similar actions. Moreover, these tariffs, or other changes in U.S. trade policy, have resulted in, and may continue to trigger, retaliatory actions by affected countries which could adversely impact demand for our products, as well as impact our costs, customers, suppliers, and/or the U.S. economy or certain sectors thereof and, thus, may adversely impact our business, operations and financial performance.
A pandemic or geopolitical conflict may adversely affect our liquidity and our ability to access the capital markets. Additionally, government stimulus programs made available to us, our customers or our suppliers, if any, may prove to be insufficient or ineffective. Furthermore, in the event the impact from a pandemic or geopolitical conflict causes us to be unable to maintain a certain level of excess availability under our revolving credit facility, our availability of funds may become limited, or we may be required to renegotiate the facility on less favorable terms. If we are unable to access additional credit at the levels we require, or the cost of credit is greater than expected, it could materially adversely affect our financial condition, results of operations and liquidity.
Our subsidiaries have several key operations which are subject to multi-year collective bargaining agreements or agreements with works councils with their hourly work forces. While we believe we have good relations with our unions, there is the risk of industrial action or work stoppage at the expiration of an agreement if contract negotiations fail, which may disrupt our manufacturing processes and impact our results of operations.
We are subject to a wide variety of complex domestic and foreign laws, rules and regulations, including trade policies and tax regimes. We are affected by new laws and regulations and changes to existing laws and regulations, including interpretations by the courts and regulators, whether prompted by changes in government administrations or otherwise. These laws, regulations and policies, and changes thereto, may result in restrictions or limitations to our current operational practices and processes and our product offerings, which could negatively impact our current cost structure, revenue streams, future tax obligations, the value of our deferred income tax assets, cash flows, and overall financial position.
In addition, our tax filings are subject to audits by tax authorities in the various jurisdictions in which we do business. These audits may result in assessments of additional taxes that are subsequently resolved with the taxing authorities or through the courts. Currently, we believe there are no outstanding assessments the resolution of which would result in a material adverse financial result. However, there can be no assurance that unasserted or potential future assessments would not have a material adverse effect on our financial condition, results of operations and liquidity.
Certain of ALP's customers are suppliers to the U.S. government. Changes in U.S. government priorities, or delays or reductions in U.S. government spending, could have a material adverse effect on our customers' business and, therefore, on our business.
The ALP segment includes Buffalo Pumps, which is a division of Air & Liquid. Buffalo Pumps manufactures centrifugal pumps for the fossil-fueled power generation, marine defense and industrial refrigeration industries. As such, Buffalo Pumps enters into contracts with customers who supply the U.S. government, particularly the U.S. Navy, from time to time. A reduction or change in spending by the U.S. Navy and/or in overall U.S. defense spending, on an absolute or inflation-adjusted basis, because of shifting priorities, budget compromises, or otherwise, could materially and adversely affect the results of our customers' operations and, in turn, our operations. Further, failure to fund a federal budget or the termination of significant programs or contracts with these customers of Buffalo Pumps by the U.S. government could adversely affect our customers' business and financial performance and, accordingly, affect our business and financial performance. In the event that appropriations are delayed or a government shutdown occurs, and continues for an extended period of time, we may be at risk of reduced orders, program cancellations, nonpayment or payment delays, and other disruptions. Changes in funding priorities also could reduce opportunities in existing and future programs and/or initiatives where we intend to compete and where we have made investments. Even when the U.S. government operates under a continuing resolution, new contract and program starts may be restricted and funding for our customers' existing contracts and, therefore, our existing contracts may be unavailable, reduced, or delayed. The occurrence of any of the foregoing events could have a material adverse effect on our business, financial condition, and results of operations.
A reduction in the level of our export sales, as well as other economic factors in foreign countries, could have an adverse impact on our financial results.
Exports are a significant portion of our sales. Historically, changes in foreign exchange rates, particularly in respect of the U.S. dollar, British pound, Swedish krona, and euro, have impacted the export of our products and may do so again in the future. Other factors that may adversely impact our export sales and our operating results include political and economic instability, export controls, changes in tax laws and tariffs, and new producers in overseas markets. A reduction in the level of our export sales may have an adverse impact on our financial results. In addition, changes in foreign currency exchange rates may provide foreign roll suppliers with advantages based on those lower foreign currency exchange rates and, therefore, permit them to compete in our home markets.
Demand for our products, particularly in our ALP segment, may grow at a pace that exceeds our operational capacity, including our manufacturing capabilities. We may be required to expand our facilities or contract with third parties to meet such growth, which we may not be able to do in a timely manner, if at all. If we are required to expand our facilities to meet growth in client demand, we may not have access to sufficient capital resources to expand in a timely manner, if at all. As a result, we may not be able to maximize sales growth and, therefore, could lose opportunities to produce additional revenue.
We are a party to sale-leaseback financing transactions, which creates the risk of loss if we default.
We periodically generate approximatelysales from individual customers approximating 10% of the net sales inof the FCEP segmentor fromALP onesegments. customer, and theThe loss of, or significant reduction in, the orders of any such significant customer could have a material adverse effect on the segment.segment's financial results.
OneFor the year ended December 31, 2025, one customer accounted for approximately 10% of the net sales of the FCEP segment and one customer accounted for approximately 12% of the net sales of the ALP segment. For the year ended December 31, 2024, one customer accounted for approximately 11% of the net sales of the FCEP segment inand eachno individual customer exceeded 10% of the yearsnet endedsales Decemberof 31,the 2024ALP and 2023.segment. The loss of such customer,customers, or a significant reduction in the orders of such customer,customers, could have a material adverse effect on the segment. For the ALP segment, no customers exceeded 10% of its net sales in 2024 or 2023.
We may not be able to satisfy the continued listing requirements of the New York Stock Exchange and the NYSE American Exchange for our common stock and Series A warrants, respectively.stock.
Our common stock is currently listed on the New York Stock Exchange, andwhich our Series A warrants are listed on the NYSE American Exchange, with each imposingimposes objective and subjective requirements for continued listing. Continued listing criteria of the New York Stock Exchange include maintaining prescribed levels of financial condition, market capitalization and shareholders’ equity. Specifically, the New York Stock Exchange requires a company with common equity listed on its exchange to maintain average global market capitalization over a consecutive 30-day trading period of at least $50 million or maintain shareholders’ equity of at least $50 million and maintain a share price of at least $1.00. Our common stock’s average-global market capitalization over the 30-day trading period ended December 31, 20242025 was $39.6$69.5 million, and our total Ampco-Pittsburgh shareholders’ equity was $58.9$32.6 million as of December 31, 2024.2025.
Continued listing criteria of the NYSE American Exchange include maintaining prescribed levels of financial condition, market capitalization and shareholders’ equity. Among other requirements, there must be an aggregate of at least 50,000 Series A warrants. Satisfaction of the NYSE American Exchange’s listing requirements therefore depends upon the extent to which warrant holders elect to exercise their Series A warrants. There can be no assurance we will continue to meet these, or other, listing standards of the NYSE American Exchange with respect to the Series A warrants. If we fail to meet the listing criteria, our warrants could be de-listed from the NYSE American Exchange, which could impact potential liquidity for our shareholders.
Activist shareholders may, from time to time, attempt to effect changes in our strategic direction and, in furtherance thereof, may seek changes in how we are governed. While our Board of Directors and management team strive to maintain constructive, ongoing communications with all of our shareholders, including activist shareholders, and welcome their views and opinions with the goal of working together constructively to enhance value for all shareholders, activist campaigns that contest, or conflict with, our strategic direction could have an adverse effect on us because: (i) responding to actions by activist shareholders can disrupt our operations, be costly and time-consuming and divert the attention of our Board of Directors and senior management from the pursuit of business strategies, which could adversely affect our results of operations and financial condition; (ii) perceived uncertainties as to our future direction may lead to the perception of a change in the direction of the business, instability or lack of continuity which may be exploited by our competitors, cause concern to our current or potential customers, result in the loss of potential business opportunitiesopportunities, and make it more difficult to attract and retain qualified personnel and business partners; and (iii) these types of actions could cause significant fluctuations in our stock price due to factors not necessarily reflecting the underlying fundamentals and prospects of our business.
Holders of Series A warrants will have no rights as holders of our common stock until they exercise their Series A warrants and acquire our common stock.
Until holders of our Series A warrants acquire shares of our common stock upon exercise of their Series A warrants, they will have no rights with respect to the shares of our common stock underlying such Series A warrants. Upon exercise of the Series A warrants, the holders thereof will be entitled to exercise their rights as holders of our common stock only as to matters for which the record date occurs after the warrant exercise date.
The market price of our common stock may not exceed the exercise price of the Series A warrants at such time as the holder desires to exercise such Series A warrants and, accordingly, the Series A warrants may have no value.
The Series A warrants are exercisable through August 1, 2025. The market price of our common stock may not exceed the exercise price of the Series A warrants at such times prior to their date of expiration or when the holder desires to exercise such warrants. Any Series A warrants not exercised by their date of expiration will expire without residual value to the holders. Additionally, the price of the Series A warrants may fluctuate, and liquidity may be limited. Holders of Series A warrants may be unable to resell their Series A warrants at a favorable price, or at all.
Because the Series A warrants are executory contracts, they may have no value in a bankruptcy or reorganization proceeding.
In the event a bankruptcy or reorganization proceeding is commenced by or against us, a bankruptcy court may hold that any unexercised Series A warrants are executory contracts subject to rejection by us with the approval of a bankruptcy court. As a result, even if we have sufficient funds, holders may not be entitled to receive any consideration for their Series A warrants or may receive an amount less than they would have been entitled to if they had exercised their Series A warrants prior to the commencement of any such bankruptcy or reorganization proceeding.
Changes in the global economic environment, inflation, elevated interest rates, recessions or prolonged periods of slow economic growth, and global instabilityinstability, and actual and threatened geopolitical conflict,conflict could have an adverse effect on our industry and business, as well as those of our customers and suppliers.
Overall economic conditions in the U.S.,United States, Europe, the United Kingdom, and elsewhere, including adverse factors such as inflation, rising or sustained elevated interest rates, supply chain disruptions, and geopolitical conflicts including the impacts from the Russia-Ukraine conflict, significantly impact our business. Periods of economic downturn or continued uncertainty could result in us having difficulty increasing or maintaining our level of sales or profitability and we may experience an adverse effect on our business, results of operations, financial condition, and cash flows.
Our U.S. operations are subject to economic conditions, including credit and capital market conditions, inflation, prevailing interest rates, and political factors which, if changed, could negatively affect our results of operations, cash flows and liquidity. Political factors include, but are not limited to, changes in administration resulting in increased or newly imposed tariffs,tariffs in the markets in which we operate, increased regulation such as carbon emissions, limitations on trading including the export of energy and raw materials, trade remedies, and changes to tax laws and regulations resulting in increased income tax liability. Actions taken by the U.S. government could affect our results of operations, cash flows and liquidity.
We are subject to economic conditions and political factors associated with the European Union, the United KingdomUnion and neighboring countries, and the euro currency. Changes in any of these economic conditions or political factors could negatively affect our results of operations, cash flows and liquidity. Political factors include, but are not limited to, taxation, nationalization, inflation, government instability, regional conflict, civil unrest, increased regulation and quotas, tariffs, sanctions, and other market-distorting measures. Continued uncertainty and economic downturn in the European market throughout 2024, as well as the ongoing Russia-Ukraine conflict have had a broad range of adverse impacts on global economic conditions, many of which have had, and are likely to continue to have, adverse impacts on our business and the business of our customers including increased raw material and energy costs, softer customer demand and lower steel prices, which has led, and may lead in the future, to the temporary idling of a portion of our customers’ raw steel capability until the demand environment improves. These uncertain conditions in the European market could lead to adverse effects on the valuation of our long-lived assets, which could negatively affect our results of operations through potential impairment charges.
Additionally, we are also exposed to risks associated with the business success and creditworthiness of our suppliers and customers. If our customers or suppliers are negatively impacted by a slowdown in economic markets, we may face reduction,reductions, delaydelays or cancellationcancellations of customer orders; delays or interruptions of the supply of raw materials; and increased risk of insolvency and other credit related issues of customers or suppliers, which could delay payments from customers, result in increased customer defaults and cause our suppliers to delay filling our needsorders on a timely or cost-effective basis, or at all. The occurrence of any of these events may adversely affect our business, results of operations, financial condition, and cash flows.
We depend on integrated IT systems to conduct our business. As a public, multi-national corporation, we are a target of phishing attacks on our email systems and other cyber-attacks, which may include computer denial-of-service attacks, computer viruses, ransomware and other malware, state-sponsored cyber-attacks, industrial espionage, insider threats, wire fraud, or other cyber incidents. IT systems failures, including risks associated with upgrading our systems or successfully integrating IT and other systems to common platforms, network disruptions and breaches of data security could disrupt our operations by impeding our processing of transactions, our ability to protect customer or company information and our financial reporting. Our computer systems, including our back-up systems, could be damaged or interrupted by power outages; computer and telecommunications failures; computer viruses; internal or external security breaches; events such as fires, earthquakes, floods, tornadoes, and hurricanes; and errors by our employees. Cyber-based risks are evolving and could include potential attacks to our IT infrastructure and to the IT infrastructure of third parties in attempts to gain unauthorized access to our confidential or other proprietary information or information relating to our employees, customers and other third parties, or to seek ransom. If a third party gainedgains unauthorized access to our data, including any data regarding our employees, customers, or vendors, thesuch security breach could expose us to risks, including loss of business, fines, and litigation. Although we have taken steps to address these concerns, there can be no assurance a system failure or data security breach will not have a material adverse effect on our financial condition, results of operations and liquidity.
Our By-laws provide,provide that, unless we otherwise consent in writing, the state and federal courts sitting in the judicial district of the Commonwealth of Pennsylvania embracing the county in which our principal executive office is located will be the sole and exclusive forum for (a) any derivative action or proceeding brought on behalf of us, (b) any action asserting a claim of breach of a fiduciary duty owed to us or our shareholders by any director, officer or other employee of ours, (c) any action asserting a claim against us or against any of our directors, officers or other employees arising pursuant to any provision of the Pennsylvania Business Corporation Law of 1988 or our Articles of Incorporation or By-laws, (d) any action seeking to interpret, apply, enforce, or determine the validity of our ArticleArticles of Incorporation or By-laws, or (e) any action asserting a claim against us or any director or officer or other employee of ours governed by the internal affairs doctrine (collectively, “Internal Governance Claims”). This exclusive forum provision does not apply to suits brought to enforce a duty or liability created by the Securities Exchange Act of 19341934, as amended (the “Exchange Act”), as amended, or the Securities Act of 19331933, as amended (the “Securities Act”), as amended.. However, the federal courts are the sole and exclusive forum for any complaint asserting a cause of action arising under the Securities Act, pursuant to our By-laws, and any complaint asserting a cause of action arising under the Exchange Act, pursuant to Section 27 of the Exchange Act. This exclusive forum provision may limit the ability of our shareholders to bring a claim in a judicial forum that such shareholders find favorable for disputes with us or our directors or officers, which may discourage such lawsuits against us and our directors and officers. Alternatively, if a court outside of Pennsylvania with respect to Internal Governance Claims or any other state court with respect to a cause of action under the Securities Act were to find this exclusive forum provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings described above, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition and results of operations.
Management's Discussion & Analysis (MD&A)
New heading “EXIT AND DECONSOLIDATION CHARGES”
New heading “(Loss) income from operations for the ALP segment includes a net charge (benefit) for asbestos-related items of $12,352 and $(4,184) in 2025 and 2024, respectively, as more fully explained in Note 20, Litigation, to the Consolidated Financial Statements.”
New heading “Forged and Cast Engineered Products”
New heading “For 2025, includes a net charge of $12,352 for the Asbestos-Related Charge. For 2024, includes a net benefit of $(4,184) for the Asbestos-Related Credit and the Asbestos-Related Proceeds. See Note 20, Litigation, to the Consolidated Financial Statements for further information.”
New heading “Depreciation and amortization for 2025 includes accelerated depreciation of $3,327.”
New heading “The accelerated depreciation portion of the Exit Charges of $3,327 is included in depreciation and amortization.”
New heading “Depreciation and amortization for 2025 includes accelerated depreciation of $3,327.”
New heading “The accelerated depreciation portion of the Exit Charges of $3,327 is included in depreciation and amortization.”
New heading “Corporate represents the operating expense of the corporate office and other costs not allocated to the various segments.”
New heading “LABOR AGREEMENTS”
New heading “COMMITMENTS AND CONTIGENT LIABILITIES”
New heading “DERIVATIVE INSTRUMENTS”
Removed heading “For 2024, represents a decrease in the estimated settlement costs of pending and future asbestos claims, net of additional insurance recoveries, and a benefit from the reduction in the estimated defense-to-indemnity cost ratio from 60% to 55%. For 2023, represents an increase in the estimated settlement costs of pending and future asbestos claims, net of additional insurance recoveries, and a reduction in the estimated defense-to-indemnity cost ratio from 65% to 60%. See Note 19, Litigation, to the Consolidated Financial Statements for further information.”
Removed heading “Represents proceeds received from an insolvent asbestos-related insurance carrier.”
Removed heading “Represents reimbursement of past energy costs at one of the Corporation’s foreign operations by its local government.”
Removed heading “For 2024, includes a net benefit of $(4,184) for the Asbestos-Related Credit and the Asbestos-Related Proceeds. For 2023, includes a net expense of $40,696 for the Asbestos-Related Charge offset by the Asbestos-Related Proceeds. See Note 19, Litigation, to the Consolidated Financial Statements for further information.”
Largest changes
For the ALP segment, the businesses are benefiting fromsee in full comparisonsteadyincreased demand in the power generation and U.S. military markets and have successfully increased market share butarecontinuefacingto face increasing production costs due toinflation and supply chain issues as a result of the lingering effects from a post-pandemic environment.inflation. The segment has been implementing price increases forcertain ofits products to help mitigate these inflationary effects. Following previous U.S. government actions, tariffs are incurred on certain of the segment's raw materials, primarily those that contain copper or copper alloys. Costs associated with these tariffs have been, and are expected to continue to be, passed on to customers. Tariff outcomes are fluid and subject to change; however, the United States's onshoring of additional manufacturing capabilities would potentially increase demand for the segment's products. The primary focus forthisthe ALP segment for 2026 is to grow revenues, monitor and minimize inflationary and tariff effects, strengthen engineering and manufacturing capabilities to keep pace with growthopportunitiesopportunities, and continue to improve its sales distribution network.
“For 2024, represents a decrease in the estimated settlement costs of pending and future asbestos claims, net of additional insurance recoveries, and a benefit from the reduction in the estimated defense-to-indemnity cost ratio from 60% to 55%. For 2023, represents an increase in the estimated settlement costs of pending and future asbestos claims, net of additional insurance recoveries, and a reduction in the estimated defense-to-indemnity cost ratio from 65% to 60%. See Note 19, Litigation, to the Consolidated Financial Statements for further information.”see in full comparison
“For 2024, includes a net benefit of $(4,184) for the Asbestos-Related Credit and the Asbestos-Related Proceeds. For 2023, includes a net expense of $40,696 for the Asbestos-Related Charge offset by the Asbestos-Related Proceeds. See Note 19, Litigation, to the Consolidated Financial Statements for further information.”see in full comparison
“For 2025, includes a net charge of $12,352 for the Asbestos-Related Charge. For 2024, includes a net benefit of $(4,184) for the Asbestos-Related Credit and the Asbestos-Related Proceeds. See Note 20, Litigation, to the Consolidated Financial Statements for further information.”see in full comparison
“(Loss) income from operations for the ALP segment includes a net charge (benefit) for asbestos-related items of $12,352 and $(4,184) in 2025 and 2024, respectively, as more fully explained in Note 20, Litigation, to the Consolidated Financial Statements.”see in full comparison
“Tariffs are also now incurred on forged and cast rolls shipped from the segment's European facilities into the United States and on U.S. forged and cast rolls shipped into China. Since the cast roll market is currently underserved in the United States, the Corporation believes the segment's remaining European cast operations are approximately on equal footing with its competition with respect to tariffs. Tariffs on steel product also have been a tailwind for the segment's FEP products resulting in increased order volumes. …”see in full comparison
Full comparison: every changed paragraph (149)
Ampco-Pittsburgh Corporation and its subsidiaries (collectively, the “Corporation”) manufacture and sell highly engineered, high-performance specialty metal products and customized equipment utilized by industry throughout the world. It operates in two business segments –: the Forged and Cast Engineered Products (“FCEP”) segment and the Air and Liquid Processing (“ALP”) segment. This segment presentation is consistent with how the Corporation’s chief operating decision maker evaluates financial performance and makes resource allocation and strategic decisions about the business.
The FCEP segment produces forged hardened steel rolls, cast rolls and forged engineered products (“FEP”). Forged hardened steel rolls are used primarily in hot and cold rolling mills by producers of steel, aluminum and other metals. Cast rolls, which are produced in a variety of iron and steel qualities, are used mainly in hot strip mills, medium/heavy section mills, roughing mills, and plate mills. FEP principally are sold to customers in the steel distribution market, the oil and gas industryindustry, and the aluminum and plastic extrusion industries. The segment has operations in the United States, England, Sweden, Slovenia, and an equity interest in threetwo joint venture companies in China. Collectively, the segment primarily competes with European, Asian, and North and South American companies in both domestic and foreign markets and operates several sales offices located throughout the world.
EXIT AND DECONSOLIDATION CHARGES
In February 2025, Union Electric Steel UK Limited (“UES-UK”), an indirect wholly owned subsidiary of the Corporation, entered into a formal consultation process with its unions and staff to evaluate various options to improve its profitability. The U.K. operations had been impacted by unpredictable and high energy costs compared to its foreign competitors, lower demand for its products manufactured in the U.K., and increased imports of rolls and flat rolled steel into Europe from low-cost countries. UES-UK completed its formal consultation process in the second quarter of 2025 and, in light of UES-UK's historical performance and management's outlook for the remainder of 2025 and subsequent years, decided to exit its operations.
The Corporation initially recognized charges approximating $10,790 primarily for employee-related costs payable to the employees of UES-UK under existing benefit plans and accelerated depreciation from reducing the estimated remaining useful lives and revising the estimated residual values of the property, plant and equipment of UES-UK. These charges include similar closure costs approximating $800 for the non-core steel distribution facility located in Ohio held by Alloys Unlimited and Processing, LLC (“AUP”) (collectively, the “Exit Charges”).
The Exit Charges included the following components:
The charge for employee-related costs primarily represents statutory severance and other benefits payable to the approximately 168 employees of UES-UK and the 15 employees of AUP under existing benefit plans. Accelerated depreciation is a non-cash charge and represents primarily higher depreciation expense resulting from reducing the estimated remaining useful lives and revising the estimated residual values of the property, plant and equipment of UES-UK and AUP. Professional fees represent direct costs incurred relating to the formal consultation process for and Structured Insolvency of UES-UK and closure of AUP. Loss on sale of assets is a non-cash charge and represents the loss on the sale of the equipment of AUP.
On October 13, 2025, the Directors of UES-UK voluntarily filed a Notice of Intention to appoint certain insolvency practitioners of FRP Advisory Trading Limited (“FRP”) as administrators of UES-UK (collectively, the “Administrators”) pursuant to the requirements of the Insolvency Act 1986 of England and Wales in the High Court of Justice, Business and Property Courts at Leeds (the “Insolvency Court”). On October 14, 2025, (the “Filing Date”), the Directors of UES-UK filed a Notice of Appointment with the Insolvency Court formally appointing the Administrators as administrators of UES-UK. This action was confined to UES-UK exclusively and did not affect the Corporation or any of its other subsidiaries.
As of the Filing Date, through the date of this Annual Report on Form 10-K, UES-UK was in administration and its affairs, business and property were being managed by the Administrators (the “Structured Insolvency”). The Administrators have set out their proposals to UES-UK’s creditors which include an orderly wind-down of UES-UK’s financial affairs and sale of its assets. Any funds remaining after the costs and expenses associated with the Structured Insolvency will be distributed in the order of priority set forth in the Insolvency Act 1986.
Through October 13, 2025, the date immediately prior to the Filing Date, the operating results of UES-UK are included in the consolidated operating results of the Corporation. Effective as of the Filing Date, the Corporation no longer consolidates the operating results of UES-UK, as the Corporation no longer has decision-making control over UES-UK. In addition, as of the Filing Date, the Corporation recognized a non-cash charge of $41,424 to (i) write-down the carrying value of its investment in UES-UK to its estimated fair value; (ii) recognize the amount of other comprehensive losses of UES-UK deferred in accumulated other comprehensive loss and (iii) establish an estimated recovery for the amount of funds expected to be returned to the lenders under the Corporation's Second Amended and Restated Revolving Credit, Term Loan and Security Agreement (the “Credit Agreement”), if any, after the costs and expenses of the Structured Insolvency (the “Deconsolidation Charge”). The majority of the severance charges included in the Exit Charges will no longer be required to be paid as a result of the Structured Insolvency. In addition, the Corporation expects its future cash expenditures associated with the Structured Insolvency to be insignificant. See Note 2, Exit and Deconsolidation Charges, to the Consolidated Financial Statements.
For the FCEP segment, global steel manufacturing capacity continues to exceed global consumption of steel products. Demand for steel is soft but stable. In 2025, as a result of low-priced products from other countries entering the United States, tariffs, as outlined under Section 232 of the Trade Expansion Act of 1962, were increased for products with domestic melt and pour requirements imported into the United States. In addition, in the third quarter of 2025, the U.S. government announced new tariffs on coated steel imported into the United States. According to U.S. Census Bureau and U.S. Commerce Department data, imports for 2025 have decreased when compared to 2024 with import reductions accelerating as the year progressed. This should result in increased utilization of our customers' domestic facilities. Similarly, we believe modified tariff and quota systems have been strengthened in Canada and Mexico to support their steel industries, which also should result in better utilization for our customers located in these countries.
Tariffs are also now incurred on forged and cast rolls shipped from the segment's European facilities into the United States and on U.S. forged and cast rolls shipped into China. Since the cast roll market is currently underserved in the United States, the Corporation believes the segment's remaining European cast operations are approximately on equal footing with its competition with respect to tariffs. Tariffs on steel product also have been a tailwind for the segment's FEP products resulting in increased order volumes. Negotiations with our customers have been successful, resulting in the vast majority of these costs being passed on to our customers.
The local currency of each of the subsidiaries of the FCEP segment is its functional (local) currency. Each of these subsidiaries may enter into contractual arrangements with customers or vendors which may be denominated in a currency other than its functional (local) currency. Currently, the Corporation does not hedge any of its foreign-denominates sales or purchases. Accordingly, changes in foreign currency exchange rates, between the date the underlying contract is executed and the date the revenue or costs are recognized and from year to year, will affect the value of reported sales and operating results. During the year, the FCEP segment was adversely affected by movement in the global foreign currency exchange market resulting in lower functional (local) currency sales and operating results when compared to the prior year, particularly for its operations in Sweden.
For the FCEP segment, global steel manufacturing capacity continues to exceed global consumption of steel products. Demand for steel in the segment’s two largest markets, North America and Europe, softened during 2024 compared to 2023 and 2022 and is approximately 15% below 2019 pre-pandemic levels as of December 31, 2024. The financial impact from weaker demand has been mitigated through higher pricing and increased participation in new mill builds, primarily in North America. Recent order intake has shown improvement, and shipments are expected to increase for the segment’s cast roll facilities and pricing to remain stable in 2025. In addition, FEP order activity is improving after several years of depressed demand. Increased entry of low-priced products from other countries has negatively impacted local demand in Europe and the U.S., with several of the segment’s largest customers engaging in trade cases to reduce the number of imports into the U.S. In addition, the new administration has announced new tariffs on steel and aluminum imports to the U.S. and has, for now, removed the exceptions that allowed some countries to continue sending products to the U.S.
The primary focus for the FCEP segment for 2026 is to improve its profitability by maintaining a strong position in the roll market and continuing to improve operational efficiency and equipment reliability following the completion of thea previously announcedsignificant capital equipment program.program In addition, in February 2025,during the segment'ssecond U.K.quarter operationsof entered into a formal consultation process with its unions and staff to evaluate various options to improve its profitability.2024.
For the ALP segment, the businesses are benefiting from steadyincreased demand in the power generation and U.S. military markets and have successfully increased market share but arecontinue facingto face increasing production costs due to inflation and supply chain issues as a result of the lingering effects from a post-pandemic environment.inflation. The segment has been implementing price increases for certain of its products to help mitigate these inflationary effects. Following previous U.S. government actions, tariffs are incurred on certain of the segment's raw materials, primarily those that contain copper or copper alloys. Costs associated with these tariffs have been, and are expected to continue to be, passed on to customers. Tariff outcomes are fluid and subject to change; however, the United States's onshoring of additional manufacturing capabilities would potentially increase demand for the segment's products. The primary focus for thisthe ALP segment for 2026 is to grow revenues, monitor and minimize inflationary and tariff effects, strengthen engineering and manufacturing capabilities to keep pace with growth opportunitiesopportunities, and continue to improve its sales distribution network.
The Corporation is actively monitoring, and will continue to actively monitor, changes prompted by the lingeringU.S. effects from a post-pandemic environment,government, repercussions from the Russia-Ukraine and Middle East conflicts and similar geopolitical matters, economic conditions, and other developments relevant to its businessbusiness, including the potential impact on its operations, financial condition, liquidity, suppliers, industry, and workforce.
Income(Loss) (loss)income from operations for the ALPFCEP segment includes athe netDeconsolidation (benefit) charge for asbestos-related itemsCharge of $(4,184)$41,424 and $40,696the inExit 2024Charges andof 2023, respectively,$10,790, as more fully explained in Note 19,2, Litigation,Exit and Deconsolidation Charges, to the Consolidated Financial Statements.
(Loss) income from operations for the ALP segment includes a net charge (benefit) for asbestos-related items of $12,352 and $(4,184) in 2025 and 2024, respectively, as more fully explained in Note 20, Litigation, to the Consolidated Financial Statements.
Net sales equaled $418,305$434,166 and $422,340$418,305 for 20242025 and 2023,2024, respectively, aan decreaseincrease of $4,035.$15,861. While net sales improvedfor forboth of the ALPsegments segment,improved, the majority of the increase wasis moreattributable than offset by lower net sales forto the FCEPALP segment. A discussion of sales by segment is included below.
(Loss) income from operations equaled $(54,479) and $12,169 for 2025 and 2024, respectively. Loss from operations for 2025 includes the Deconsolidation Charge of $41,424 to (i) write-down the Corporation investment in UES-UK to its estimated fair value; (ii) recognize the other comprehensive losses of UES-UK deferred in accumulated other comprehensive loss; and (iii) establish an estimated recovery for the amount of funds expected to be returned to the lenders under the Credit Agreement, if any, after the costs and expenses of the Structured Insolvency. The estimated recovery was based on the Corporation's assessment of the expected recovery from the Structured Insolvency proceedings including consideration of information provided by the Administrators. The Corporation has evaluated, and will continue to evaluate, the continued appropriateness of the estimated recovery. If it is determined the estimated recovery is lower than currently estimated, then a charge to net (loss) income would be recorded. Similarly, if it is determined the estimated recovery is higher than currently estimated, then a credit to net (loss) income would be recorded. Any recovery will be distributed in the order of priority set forth in the Insolvency Act 1986.
In addition, loss from operations for 2025 includes:
Charge of $12,352 associated with the increase in the estimated costs of pending and future asbestos claims net of additional insurance recoveries offset by a reduction in the estimated defense-to-indemnity cost ratio from 55% to 50% (the “Asbestos-Related Charge”);
The Exit Charges for severance and related costs associated with exiting the Corporation's U.K. and AUP operations of approximately $10,790; and Employee-retention credits, which are refundable employer payroll taxes for certain eligible businesses affected by the COVID-19 pandemic, of $735 received from the Internal Revenue Service during the second quarter of 2025 (the “Employee-Retention Credits”) for the FCEP ($456) and ALP ($279) segments.
IncomeBy (loss)comparison, from operations equaled $12,169 and $(34,574) for 2024 and 2023, respectively. Includedincluded in income from operations for 2024 is a:
By comparison, included in loss from operations for 2023 is a:
Net charge of $40,887 associated with the increase in the estimated costs of pending and future asbestos claims net of additional insurance recoveries and a reduction in the estimated defense-to-indemnity cost ratio from 65% to 60% (the “Asbestos-Related Charge”);
Credit of $191 for proceeds received from an insolvent asbestos-related insurance carrier (the “Asbestos-Related Proceeds”); and Credit of $1,874 for the reimbursement of past energy costs at one of the Corporation’s foreign operations by its local government (the “Foreign Energy Credit”).
A discussion of income (loss) income from operations for the Corporation’s two segments is included below. Corporate costs increaseddecreased in 2024,2025, when compared to 2023,2024, by $1,113,$2,238, primarily due to higherlower employee-relatedemployee costsincentive-related and professional fees.costs.
Backlog equaled $378,884$328,937 at December 31, 20242025 versus $378,912$378,884 as of December 31, 2023.2024. Backlog represents the accumulation of firm orders on hand which: (i) are supported by evidence of a contractual arrangement, (ii) include a fixed and determinable sales price, (iii) have collectability that is reasonably assured, and (iv) generally are expected to ship within two years from the backlog reporting date. Backlog at a certain date may not be a direct measure of future revenue for a particular order because price increases, negotiated subsequently to the original order, are not included in backlog until the updated contract is received from the customer andcustomer, certain surcharges are not determinable until the order is completed and ready for shipment to the customer.customer, and certain orders are denominated in currency other than the functional (local) currency of the subsidiary and are not hedged. Approximately 5%6% of the backlog is expected to be released after 2025.2026. A discussion of backlog by segment is included below.
Gross margin, excluding depreciation and amortization, as a percentage of net sales was 19.5%18.4% and 17.7%19.5% for 20242025 and 2023,2024, respectively, and includes the Foreign Energy Credit for 2023.respectively. For the FCEP segment, gross margin, excluding depreciation and amortization, decreased when compared to the prior year, primarily as a result of lower absorption and changes in product mix. For the ALP segment, gross margin, excluding depreciation and amortization, improved when compared to the prior year, primarily as a result of higher pricing.production For the ALP segment, gross margin, excluding depreciationvolumes and amortization, declined slightly when compared to the prior year, primarily as a result of an unfavorablefavorable product mix.
Selling and administrative expenses approximated $52,125 (12.0% of net sales) and $54,878 (13.1% of net sales) and $50,884 (12.0% of net sales) for 20242025 and 2023,2024, respectively. The increasedecrease of $3,994$2,753 is principally due to higherlower employee-relatedemployee costs,incentive-related highercosts commissionsoffset for the ALP segment, andby higher professional fees for Corporate.fees.
Depreciation and amortization expense equaled $18,611$21,785 and $17,674$18,611 for 20242025 and 2023,2024, respectively. The increase of $937$3,174 is primarily associatedattributable withto completionthe $3,327 of accelerated depreciation resulting from reducing the estimated remaining useful lives and revising the estimated residual values of the capitalproperty, plant and equipment program at the FCEP segment, in the first half of 2024,UES-UK toand upgrade existing machinery at certain of its locations.AUP.
Charge (Creditcredit) charge for asbestos-related costs equaled $12,352 and $(4,184) and $40,696 for 20242025 and 2023,2024, respectively.
The creditcharge for 20242025 represents:
An increase in the estimated settlement costs of pending and future asbestos claims, net of additional insurance recoveries, of $14,525 primarily as a result of recent experience; offset by A reduction in the estimated defense-to-indemnity cost ratio from 55% to 50%, based on ongoing experience and improvements in defense costs that are expected to continue, which reduced estimated costs by approximately $2,173.
The credit for 2024 represents the net of:
The charge for 2023 represents the net of:
An increase in the estimated settlement costs of pending and future asbestos claims, net of additional insurance recoveries, of $42,344 primarily as a result of recent experience and higher expected settlement values to resolve a claim; offset by A reduction in the estimated defense-to-indemnity cost ratio from 65% to 60%, based on ongoing experience and improvements in defense costs that are expected to continue, which reduced estimated costs by approximately $1,457; and Asbestos-Related Proceeds of $191.
Deconsolidation Charge represents the non-cash charge to (i) write-down the carrying value of the Corporation's investment in UES-UK to its estimated fair value; (ii) recognize the amount of other comprehensive losses of UES-UK deferred in accumulated other comprehensive loss and (iii) establish an estimated recovery for the amount of funds expected to be returned to the lenders under the Credit Agreement, if any, after the costs and expenses of the Structured Insolvency.
Severance charge represents primarily statutory severance and other benefits payable to the approximately 168 employees of UES-UK and the 15 employees of AUP under existing benefit plans.
Investment-related income equaled $121 and $128 for 2024 and 2023, respectively, and represents primarily dividends received from one of the Corporation’s Chinese joint ventures.
Interest expense equaled $11,620$11,369 and $9,347$11,620 for 20242025 and 2023,2024, respectively. The increasenet decrease of $2,273$251 is principally due to:
Other income – net for 2025 decreased when compared to 2024 principally due to the lower net pension and other postretirement income resulting from a lower expected return on plan assets in 2025 versus 2024.
Higher interest on the equipment financing facility, net of capitalized interest, of approximately $1,259 in 2024 when compared to 2023;
Higher average borrowings outstanding under the revolving credit facility, which increased interest expense by approximately $710 in 2024 when compared to 2023;
Higher average interest rates for 2024 versus 2023, which increased interest expense by approximately $196 in 2024 when compared to 2023; and Higher interest on the sale-leaseback financing transactions, including interest on the proceeds received from the Disbursement Agreement in June 2023, which increased interest expense by approximately $149 in 2024 when compared to 2023.
Other income – net for 2024 and 2023 is comparable and is comprised of the following:
Income tax (provision) benefit equaled $(2,695)$120 and $1,158$2,695 for 20242025 and 2023,2024, respectively, and includes income taxes associated with the Corporation’s profitable operations. An income tax benefit is not able to be recognized on losses of certain of the Corporation’s entities since it is “more likely than not” the asset will not be realized. Accordingly, changes in the income tax provision for each period includes the effects of changes in the pre-tax income of the Corporation’s profitable operations in each jurisdiction and changes in expectations as to whether an income tax benefit will be able to be realized for the deferred income tax assets recognized.
The income tax provision for 2025 benefited from a lower statutory income tax rate on the earnings of the Corporation's majority-owned Chinese joint venture as a result of the joint venture qualifying as a high-tech enterprise (“HTE”). As an HTE, the earnings of the Chinese joint venture are taxed at a rate of 15% (versus 25%). The effect on the income tax provision was a benefit of $1,000 for the year ended December 31, 2025, when compared to the income tax provision for the year ended December 31, 2024.
The income tax provision for 2025 includes a state income tax benefit of approximately $494 associated with the Asbestos-Related Charge whereas the income tax provision for 2024 includes state income tax expense of approximately $153 associated with the Asbestos-Related Credit.
In late 2022, as a result of significant increases in energy costs in the U.K., resulting primarily from the Russia-Ukraine conflict, the Corporation moved certain of its cast roll production from the U.K. to Sweden. Accordingly, profitability of the Corporation’s U.K. operations has declined, and profitability of the Corporation’s Sweden operations has improved. As of December 31, 2023, the Corporation’s U.K. operations entered into a three-year cumulative loss position moving the U.K. operations from a net deferred income tax liability position to a net deferred income tax asset position and resulting in recognition of a valuation allowance against the net deferred income tax assets of $316. In addition, the income tax provision for 2024 would not include any income tax benefit on the net operating losses generated by the Corporation's U.K operations in 2024, which has the effect of increasing the current year income tax provision by approximately $2,100. The income tax provision for 2024 also includes approximately $153 of state income tax expense associated with the Asbestos-Related Credit whereas the income tax benefit for 2023 includes approximately $1,330 of state income tax benefit associated with the Asbestos-Related Charge offset by income tax expense of $203, resulting from the revaluation of state deferred income tax assets of the ALP segment following new legislation enacted in 2022, which will gradually decrease the Pennsylvania state income tax rate to 4.99% by 2031.
Valuation allowances are recorded against the majority of the Corporation’s deferred income tax assets. The Corporation will maintain the valuation allowances until there is sufficient evidence to support the reversal of all or some portion of the valuation allowances. Given the Corporation’s anticipated future earnings from operations in Sweden, due in part to the movement of cast roll production from the U.K. to Sweden, and in the United States, the Corporation believes there is a reasonable possibility within the next 12 months, sufficient positive evidence may become available to allow the Corporation to conclude some portion of the valuation allowance will no longer be needed. Release of any portion of the valuation allowance would result in the recognition of deferred income tax assets on the Corporation’s consolidated balance sheet and a decrease to the Corporation’s income tax expense in the period the release is recorded. The exact timing and the amount of the valuation allowance released are subject to, among many items, the level of profitability achieved. Once the valuation allowance is completely reversed, a tax provision would be recognized on future earnings.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States. OBBBA introduces multiple tax law and legislative changes, including modifications to income tax provisions such as business interest expense limitations, domestic research and development expenses and U.S. taxation of international earnings. It also reinstates 100% bonus depreciation for property acquired and placed into service on or after January 19, 2025. The Corporation has recognized the effects of the OBBBA provisions in its financial results to the extent they are applicable for the year ended December 31, 2025. Certain provisions of the OBBBA have effective dates after December 31, 2025. The Corporation will continue to evaluate the impact of these provisions on its future consolidated financial statements.
Net (loss) attributable to Ampco-Pittsburgh was approximately $(66,067) or $(3.28) per common share for 2025. Net loss attributable to Ampco-Pittsburgh and net loss per common share attributable to Ampco-Pittsburgh for 2025 include a net after-tax charge of $63,348 or $3.15 per common share associated with the Deconsolidation Charge, the Exit Charges, the Asbestos-Related Charge, and the Employee-Retention Credits. No income tax benefit was able to be recognized for the Deconsolidation Charge or the Exit Charges since the underlying operations remained in a three-year cumulative loss position as of December 31, 2025. The income tax benefit resulting from the Corporation's majority-owned Chinese joint venture qualifying as an HTE of approximately $1,000 reduced the net loss attributable to Ampco-Pittsburgh and net loss per common share attributable to Ampco-Pittsburgh by approximately $598, or $0.03 per common share, for 2025.
Net income (loss) attributable to Ampco-Pittsburgh was approximately $438 or $0.02 per common share for 2024 and $(39,928) or $(2.04) per common share for 2023.
Net income attributable to Ampco-Pittsburgh was approximately $438 or $0.02 per common share for 2024. Net income attributable to Ampco-Pittsburgh and net income per common share attributable to Ampco-Pittsburgh for 2024 include a net after-tax credit of $4,031 or $0.20 per common share associated with the Asbestos-Related Credit and the Asbestos-Related Proceeds.
Forged and Cast Engineered Products
Net sales increased by $6,043 in 2025 from 2024 principally due to:
Improved pricing, including variable-index surcharges passed through to customers as a result of fluctuations in the price of raw material, energy and transportation cost, which increased net sales in 2025 when compared to 2024 by approximately $9,400;
What changed in the latest 10-Q
Risk Factors
There have been no material changes in our risk factors from those disclosed in Part I, Item 1A to our Annual Report on Form 10-K for the year ended December 31, 2025. The risk factors disclosed in Part I, Item 1A to our Annual Report on Form 10-K for the year ended December 31, 2025, in addition to the other information set forth in this report, could adversely affect the Corporation’s operating performance and financial condition. Additional risks not currently known or deemed immaterial may also result in adverse effects on the Corporation.
Items 2-4 None.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “Depreciation and amortization for the three and six months ended June 30, 2025 includes accelerated depreciation of $654 associated with exiting the U.K. operations.”
New heading “(2) Depreciation and amortization for the three and six months ended June 30, 2025 includes accelerated depreciation of $654 associated with exiting the U.K. operations.”
Largest changes
“(2) Depreciation and amortization for the three and six months ended June 30, 2025 includes accelerated depreciation of $654 associated with exiting the U.K. operations.”see in full comparison
“Depreciation and amortization for the three and six months ended June 30, 2025 includes accelerated depreciation of $654 associated with exiting the U.K. operations.”see in full comparison
“Income from operations for the six months ended June 30, 2026 includes the Deconsolidation Charge of $875 associated with the write-down of the Estimated Recovery. Loss from operations for the three and six months ended June 30, 2025 includes the Exit Charge of $6,750 and the Employee-Retention Credits of $456.”see in full comparison
Backlogsee in full comparisondecreasedincreased atMarchJune31,30, 2026 from December 31, 2025 by$6,863$9,635 primarily due totimingreceiptwithof additional customer ordersfor 2027 expected laterdue, in2026.part,Additionally,tolowertiming and also a direct result of the aforementioned tariffs. Changes in exchange rates used to translate the backlog of the Corporation’s foreign subsidiaries into the U.S. dollar decreased backlog atMarchJune31,30, 2026, when compared to backlog at December 31, 2025, by approximately$2,600.$4,100. AtMarchJune31,30, 2026, approximately11%36% of the segment's backlog is expected to ship after 2026.
“Selling and administrative expenses approximated $12,917 and $12,968 for the three months ended June 30, 2026 and 2025, respectively, a decrease of $51, and $26,801 and $26,627 for the six months ended June 30, 2026 and 2025, respectively, an increase of $174. Selling and administrative expenses remained relatively comparable for each of the periods. …”see in full comparison
“Deconsolidation Charge of $875 for the six months ended June 30, 2026 represents the write-down of the Estimated Recovery from the Structured Insolvency based on updated information received from the Administrators including lower funds expected to be available for future distribution.”see in full comparison
Full comparison: every changed paragraph (83)
The Private Securities Litigation Reform Act of 1995 (the “Act”) provides a safe harbor for forward-looking statements made by us or on behalf of Ampco-Pittsburgh Corporation and its subsidiaries (collectively, “we,” “us,” “our,” or the “Corporation”). Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this Quarterly Report on Form 10-Q, as well as the condensed consolidated financial statements and notes hereto, may include, but are not limited to, statements about operating performance, trends and events we expect or anticipate will occur in the future, statements about sales and production levels, timing of orders for our products, restructurings, the impact from pandemics and geopolitical conflicts, profitability and anticipated expenses, inflation, the global supply chain, the continued impact of tariffs, global trade conditions, the number and size of asbestos-related claims and sufficiency of asbestos-related insurance coverage, our ability to convert backlog to revenue in a timely manner, and cash outflows. All statements in this document other than statements of historical fact are statements that are, or could be, deemed “forward-looking statements” within the meaning of the Act and words such as “may,” “will,” “intend,” “believe,” “expect,” “anticipate,” “estimate,” “project,” “target,” “goal,” “forecast,” and other terms of similar meaning that indicate future events and trends are also generally intended to identify forward-looking statements. Forward-looking statements speak only as of the date on which such statements are made, are not guarantees of future performance or expectations, and involve risks and uncertainties. For us, these risks and uncertainties include, but are not limited to:
Through October 13, 2025, the date immediately prior to the Filing Date, the operating results of UES-UK are included in the condensed consolidated operating results of the Corporation. Effective as of the Filing Date, the Corporation no longer consolidates the operating results of UES-UK, as the Corporation no longer has decision-making control over UES-UK. As of the Filing Date, the Corporation (i) wrote down its investment in UES-UK to its estimated fair value; (ii) recognized the other comprehensive losses of UES-UK deferred in accumulated other comprehensive loss; and (iii) established an estimated recovery for the amount of funds expected to be returned to the lenders under the Corporation's Second Amended and Restated Revolving Credit, Term Loan and Security Agreement (the “Credit Agreement”), if any, after the costs and expenses of the Structured Insolvency, if any, since the accounts receivables, inventories, and equipment of UES-UK were held as collateral under the Credit Agreement (the “Estimated Recovery”).
The Estimated Recovery recorded and outstanding as of December 31, 2025 equaled $7,500, which was based on the Corporation's assessment of the expected recovery from the insolvency proceedings, including consideration of information provided by the Administrators such as the value and the priority of the claims by various creditors. In January 2026, the Administrators distributed $1,255,$1,255 to the Corporation, which was returned to the lenders under the Credit Agreement and reducedreducing the Corporation's balance outstanding under the Credit Agreement. As of March 31, 2026, the Corporation evaluated the collectability of the remaining Estimated Recovery and, basedBased on updated information received from the AdministratorsAdministrators, including lower funds expected to be available for future distributions, the Corporation subsequently wrote down the Estimated Recovery by $875 which is recognized as a Deconsolidation Charge in the accompanying condensed consolidated statementstatements of operations.operations for the six months ended June 30, 2026.
The Corporation will continue to evaluate the collectability of the Estimated Recovery and will adjust the Estimated Recovery based on facts and circumstances at each reporting date. If it is determined the Estimated Recovery is expected to be lower than currently estimated, then the Estimated Recovery would be reduced and a charge to net (loss) income would be recorded. Similarly, if it is determined the Estimated Recovery is expected to be higher than currently estimated, then the Estimated Recovery would be increased and a credit to net (loss) income would be recorded. Any recovery will be distributed in the order of priority set forth in the Insolvency Act 1986.
In addition, during 2025, the Corporation closed its non-core steel distribution facility located in Ohio previously held by Alloys Unlimited and Processing, LLC (“AUP”). In December 2025, AUP was merged into Union Electric Steel Corporation, aan directindirect wholly owned subsidiary of the Corporation.
For the FCEP segment, global steel manufacturing capacity continues to exceed global steel product consumption. Steel demand is soft but, to date, has been improving over the last few quarters for the segment's largest markets.market. In the third quarter of 2025, the U.S. government announced new tariffs on coated steel imports and, effective April 2026, tariffs were increased to 50% on most flat-rolled steel imported into the United States. These additional tariff protections cover more products for our North American customers and have meaningfully reduced imports, thereby supporting pricing, improving U.S. steel mill utilization and, in turn, increasing the number of rolling mill rolls being consumed, a positive for the segment.
Tariffs are now applied to steel forged and cast rolls shipped from the segment's European facilities to the United States and to U.S. forged and cast rolls shipped to China. Steel is an important distinction as the highest volume of cast rolls imported into the United States is subject only to a country-specific tariff of 10%, which will expire in the third quarter of 2026,10% instead of the higher rates on steel forged roll imports. As the U.S. market is underserved for cast rolls, these tariffs have had little effect on our business. Tariffs remain in place for products that compete with our FEP products, resulting in increases in orders and higher margins.
For the ALP segment, businesses are benefiting from increasedhigher demand acrossin the power generationgeneration, primarily due to growth in the data center market, and defense sectors.sectors, primarily due to higher defense spending by U.S. Navy shipbuilders. By prioritizing customer relationships and delivering highly engineered solutions, wethe believeCorporation believes the segment has successfully increased its market share and is actively investing in increased capacity to support this growth. Though it continues to face rising production costs due to inflation, the segment has mitigated these effects through strategic price increases. TheWith rising market demand and increasing backlog, the focus for this segment is to growadd revenues,to strengthen engineering andits manufacturing capabilitiescapacity with the timely commissioning of new equipment expected in the second half of 2026, increase its headcount, and continue to improve its salesmanufacturing distribution network.efficiencies.
Net sales approximated $108,327$102,918 and $104,265$113,104 for the three months ended MarchJune 31,30, 2026 and 2025, respectively, ana improvementdecrease of $4,062.$10,186, and $211,245 and $217,369 for the six months ended June 30, 2026 and 2025, respectively, a decrease of $6,124. A discussion of net sales for the Corporation’s two segments is included below.
Income (loss) from operations approximated $2,562$5,072 and $3,850$(3,078) for the three months ended MarchJune 31,30, 2026 and 2025, respectively, aan decreaseimprovement of $1,288.$8,150, and $7,634 and $772 for the six months ended June 30, 2026 and 2025, respectively, an increase of $6,862. Income from operations for the threesix months ended MarchJune 31,30, 2026 includes the Deconsolidation Charge of $875 associated with the write-down of the Estimated Recovery. A discussion of income from operations for the Corporation’s two segments is included below.
Backlog equaled $345,532 as of March 31, 2026 versus $328,937 as of December 31, 2025. Backlog represents the accumulation of firm orders on hand which: (i) are supported by evidence of a contractual arrangement, (ii) include a fixed and determinable sales price, (iii) have reasonably assured collectability, and (iv) generally are expected to ship within two years from the backlog reporting date. Backlog at a certain date may not be a direct measure of future revenue for a particular order because price increases, negotiated subsequently to the original order, are not included in backlog until the updated contract is received from the customer, certain surcharges are not determinable until the order is complete and ready for shipment to the customer, and certain orders are denominated in currency other than the functional (local) currency of the subsidiary and are not hedged. Approximately 18% of the backlog is expected to be released after 2026. A discussion of backlog by segment is included below.
Costs of products sold, excluding depreciation and amortization, as a percentage of net sales, for the three months ended March 31, 2026 and 2025 approximated 80.1% and 78.7% respectively, with the increase primarily being driven by the FCEP segment. See further discussion in the below commentary for the Corporation’s two segments.
Selling and administrative expenses approximated $13,884 and $13,659 for the three months ended March 31, 2026 and 2025, respectively, an increase of $225. Closure of UES-UK and AUP in the fourth quarter of 2025 eliminated approximately $970 of selling and administrative costs for the three months ended March 31, 2026 when compared to the three months ended March 31, 2025 offset by higher commissions for the ALP segment of approximately $600, higher employee-related costs, and general inflationary increases.
Depreciation and amortization approximated $4,258 and $4,636 for the three months ended March 31, 2026 and 2025, respectively, a decrease of $378 principally attributable to the absence of depreciation for UES-UK and AUP for the three months ended March 31, 2026 when compared to the three months ended March 31, 2025.
InterestIncome expense(loss) wasfrom comparableoperations for the three and six months ended MarchJune 31,30, 20262025 and 2025, primarily due toincludes:
A charge approximating $6,750 primarily for employee-related costs payable to the 168 employees of UES-UK under existing benefit plans and accelerated depreciation from reducing the estimated remaining useful lives and revising the estimated salvage value of the property, plant and equipment of UES-UK (the “U.K. Exit Charge”) and Employee-retention credits, which were refundable employer payroll taxes for certain eligible businesses affected by the COVID-19 pandemic, of $735 received from the Internal Revenue Service during the second quarter of 2025 (the “Employee-Retention Credits”) for the FCEP ($456) and ALP ($279) segments.
A discussion of income (loss) from operations for the Corporation’s two segments is included below.
Backlog equaled $385,378 as of June 30, 2026 versus $328,937 as of December 31, 2025. Backlog represents the accumulation of firm orders on hand which (i) are supported by evidence of a contractual arrangement, (ii) include a fixed and determinable sales price, (iii) have reasonably assured collectability, and (iv) generally are expected to ship within two years from the backlog reporting date. Backlog at a certain date may not be a direct measure of future revenue for a particular order because price increases, negotiated subsequently to the original order, are not included in backlog until the updated contract is received from the customer, certain surcharges are not determinable until the order is complete and ready for shipment to the customer, and certain orders are denominated in currency other than the functional (local) currency of the subsidiary and are not hedged. Approximately 44% of the backlog is expected to be released after 2026. A discussion of backlog by segment is included below.
Costs of products sold, excluding depreciation and amortization, as a percentage of net sales, approximated 78.4% and 81.3%, for the three months ended June 30, 2026 and 2025, respectively, and 79.3% and 80.1%, for the six months ended June 30, 2026 and 2025, respectively, with the improvement being attributable to the ALP segment. Included in costs of products sold, excluding depreciation and amortization, for the three and six months ended June 30, 2025 is the benefit from the Employee-Retention Credits. See further discussion in the below commentary for the Corporation’s two segments.
Selling and administrative expenses approximated $12,917 and $12,968 for the three months ended June 30, 2026 and 2025, respectively, a decrease of $51, and $26,801 and $26,627 for the six months ended June 30, 2026 and 2025, respectively, an increase of $174. Selling and administrative expenses remained relatively comparable for each of the periods. While the closure of UES-UK and AUP in the fourth quarter of 2025 eliminated approximately $1,100 and $2,100 of selling and administrative costs for the three and six months ended June 30, 2026 when compared to the three and six months ended June 30, 2025, respectively, higher employee-related costs, higher commissions for the ALP segment, and general inflationary increases offset the expected reduction in selling and administrative expenses.
Depreciation and amortization approximated $4,226 and $5,368 for the three months ended June 30, 2026 and 2025, respectively, a decrease of $1,142, and $8,484 and $10,004 for the six months ended June 30, 2026 and 2025, respectively, a decrease of $1,520 principally attributable to the absence of depreciation for UES-UK and AUP. Depreciation and amortization for UES-UK and AUP approximated $1,000 and $1,400 for the three and six months ended June 30, 2025, respectively.
Deconsolidation Charge of $875 for the six months ended June 30, 2026 represents the write-down of the Estimated Recovery from the Structured Insolvency based on updated information received from the Administrators including lower funds expected to be available for future distribution.
Severance charge of $5,854 recognized for the three and six months ended June 30, 2025 represents primarily statutory severance and other benefits payable to the 168 employees of UES-UK under existing benefit plans. As a result of the Structured Insolvency, no outstanding accrued severance remained as of December 31, 2025.
Interest expense decreased approximately $34 and $37 for the three and six months ended June 30, 2026 and 2025, respectively, when compared to the same periods of the prior year, primarily due to:
Other income (expense) – net is comprised of the following:
Other income (expense) – net fluctuated for the three and six month periods June 30, 2026 when compared to the same periods of the prior year primarily due to:
Lower losses on foreign exchange transactions; offset by
Other income – net fluctuated primarily due to lowerLower net pension and other postretirement income, which is principally attributable to the U.S. defined benefit pension plan reaching a fully funded status in early 2026,2026 resulting in a change in its investment strategies to a more conservative portfolio.portfolio; and Lower investment income with the prior year periods benefiting from (i) interest received on refundable employer payroll taxes from the Internal Revenue Service for certain eligible businesses affected by the COVID-19 pandemic and (ii) a dividend from one of the Corporation's Chinese joint ventures.
The income tax provisionsprovision for threethe six months ended MarchJune 31,30, 2025 includes a one-time income tax benefit of approximately $500,$500 resulting from the Corporation's majority-owned Chinese joint venture initially qualifying as a high-tech enterprise (“HTE”). As a HTE, the earnings of the Chinese joint venture through the end of 2026 will be taxed at a rate of 15% (versus 25%). The HTE status is renewable, subject to certain criteria being met, for which the Chinese joint venture expects to renew.
Valuation allowances are recorded against the majority of the Corporation’s deferred income tax assets. The Corporation will maintain the valuation allowances until there is sufficient evidence to support the reversal of all or some portion of the allowances. Given the Corporation’s current earnings and anticipated future earnings in Sweden and in the United States, the Corporation believes there is a reasonable possibility within the next 12 months,months that sufficient positive evidence may become available to allow the Corporation to conclude some portion of the valuation allowance will no longer be needed. Release of any portion of the valuation allowance would result in the recognition of deferred income tax assets on the Corporation’s condensed consolidated balance sheetsheets and a decrease to the Corporation’s income tax expense in the period the release is recorded. The exact timing and the amount of the valuation allowance released are subject to, among many items, the level of profitability achieved. Once the valuation allowance is completely reversed, a tax provision would be recognized on future earnings.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States. OBBBA introduces multiple tax law and legislative changes. The Corporation has recognized the effects of the OBBBA provisions in its condensed consolidated financial statements to the extent they are applicable. Certain provisions of the OBBBA have effective dates after the date of this Quarterly Report on Form 10-Q; accordingly, theThe Corporation monitors and will continue to evaluatemonitor legislative changes resulting from the OBBBA, and other legislative changes, and will incorporate the impact of thesesuch provisionschanges onin its futurethe condensed consolidated financial statements.statements when enacted.
Net lossincome attributable to Ampco-Pittsburgh and net lossincome per common share attributable to Ampco-Pittsburgh equaled $(867),$1,489, or $(0.04)$0.07 per common shareshare, and $622, or $0.03 per common share, for the three and six months ended MarchJune 31,30, 2026, respectively. Net income attributable to Ampco-Pittsburgh for the six months ended June 30, 2026 and includedincludes the Deconsolidation Charge, which increased thedecreased net lossincome attributable to Ampco-Pittsburgh and net lossincome per common share attributable to Ampco-Pittsburgh by $875 and $0.04 per common share for the threesix months ended MarchJune 31,30, 2026.
Net incomeloss attributable to Ampco-Pittsburgh and net incomeloss per common share attributable to Ampco-Pittsburgh equaled $(7,335), or $(0.36) per common share, and $(6,193), or $(0.31) per common share, for the three and six months ended MarchJune 31,30, 20252025, equaledrespectively, $1,142,including orthe $0.06U.K. Exit Charge and the Employee-Retention Credits. The U.K. Exit Charge and the Employee-Retention Credits impacted net loss attributable to Ampco-Pittsburgh and net loss per common share attributable to Ampco-Pittsburgh by $6,006, or $0.30 per common share, for each of the three and includedsix themonths ended June 30, 2025. The income tax benefit resulting from the Corporation's majority-owned Chinese joint venture qualifying as an HTE of approximately $500,$500 whichreduced improvedthe net incomeloss attributable to Ampco-Pittsburgh and net incomeloss per common share attributable to Ampco-Pittsburgh by approximately $299$299, andor $0.01 per common shareshare, for the threesix months ended MarchJune 31,30, 2025.
NetThe change in net sales for the three and six months ended MarchJune 31,30, 2026 decreased $1,4782026, when compared to the same periodperiods of the prior yearyear, is primarily due to the following:
Lower volume of roll shipments primarily due to the Structured Insolvency of UES-UK and lower sales of large rolls, which decreased net sales by approximately $9,300 and $13,900, respectively;
Lower volume of roll shipments primarilypricing due to timingchanges whichin decreasedproduct netmix, sales by approximately $4,600; and Lower volume of FEP shipments which decreased net sales by approximately $800;partly offset by Changes in exchange rates used to translate net sales of the segment’s foreign subsidiaries into the U.S. dollar which increased net sales by approximately $3,700; and Higherhigher variable-index surcharges passed through to customers as a result of fluctuations in the price of raw materials, energy and transportation costs, offset by slightly lower pricing due to changes in product mix which increaseddecreased net sales by approximately $200.$2,500 and $2,300, respectively;
Income from operations for the three months ended March 31, 2026 decreased by $2,999 when compared to the three months ended March 31, 2025 primarily due to:
Unfavorable manufacturing absorption which adversely impacted operating results by approximately $2,400;
Lower volume of roll and FEP shipments, primarily due to timing, and unfavorable product mix which decreased operating results by approximately $1,500; and The Deconsolidation Charge of $875; offset by Lower manufacturing costs and higher variable-index surcharges net of slightly lower pricing, which increased operating results by approximately $900;
Lower sellingvolume andof administrativeFEP costsshipments principally due tofor the closuressix ofmonths UES-UK and AUP offset by higher employee-related costs and general inflation,ended, which increaseddecreased operatingnet incomesales by approximately $500$750; andoffset by Changes in exchange rates used to translate the operatingnet resultssales of the segment’s foreign subsidiaries into the U.S. dollardollar, which improvedincreased operatingnet resultssales by approximately $400.$1,200 and $4,800, respectively.
Income from operations for the six months ended June 30, 2026 includes the Deconsolidation Charge of $875 associated with the write-down of the Estimated Recovery. Loss from operations for the three and six months ended June 30, 2025 includes the Exit Charge of $6,750 and the Employee-Retention Credits of $456.
In addition, the change in income (loss) from operations for the three and six months ended June 30, 2026, when compared to the three and six months ended June 30, 2025, includes:
Lower manufacturing costs including higher variable-index surcharges, which increased operating results by approximately $4,300 and $5,200;
Lower selling and administrative costs principally due to the closures of UES-UK and AUP offset by higher employee-related costs and general inflation, which increased operating income by approximately $1,200 and $1,675; and Changes in exchange rates used to translate the operating results of the segment’s foreign subsidiaries into the U.S. dollar, which improved operating results by approximately $100 and $500; offset by Lower volume of roll and FEP shipments and unfavorable product mix, which decreased operating results by approximately $2,600 and $4,100; and Unfavorable manufacturing absorption, which adversely impacted operating results by approximately $1,400 and $3,800.
Backlog decreasedincreased at MarchJune 31,30, 2026 from December 31, 2025 by $6,863$9,635 primarily due to timingreceipt withof additional customer orders for 2027 expected laterdue, in 2026.part, Additionally,to lowertiming and also a direct result of the aforementioned tariffs. Changes in exchange rates used to translate the backlog of the Corporation’s foreign subsidiaries into the U.S. dollar decreased backlog at MarchJune 31,30, 2026, when compared to backlog at December 31, 2025, by approximately $2,600.$4,100. At MarchJune 31,30, 2026, approximately 11%36% of the segment's backlog is expected to ship after 2026.
The increase in net sales for the three and six months ended MarchJune 31,30, 2026, when compared to the same periodperiods of the prior year, is primarily due to:
Higher net sales of air handling units principally due to increased demand.
Higher volume of shipments of commercial product, which increased net sales by approximately $400 and $2,500, respectively;
Higher volume of shipments of commercial OEM product, which increased net sales by approximately $2,070; and Higher volume of shipments to customers in the power generation market, which increased nets sales by approximately $850$900 and $1,700, respectively; offset by Lower volume of shipments to industrial OEMs,customers, which reduced net sales by approximately $1,380.$100 and $1,400.
Net sales of air handling units fluctuated primarily due to timing of shipments as demand has improved from the prior year (see backlog discussion below).
Higher volume of shipments of pumps and aftermarket products to customers in the power generation market, which is benefiting from increased demand due to the growth in the data center market, which increased net sales by approximately $2,120;$3,500 and Higher$5,600, volume of shipments of aftermarket orders to the U.S. Navy market primarily due to increased demand, which increased nets sales by approximately $540respectively; offset by Lower volume of shipments of new pump sets and aftermarket orders to the U.S. Navy market principallyprimarily due to timing of orders as requested by customers, which decreased netnets sales by approximately $1,080.$2,400 and $2,900, respectively.
The improvement in operating income for the three and six months ended MarchJune 31,30, 2026, when compared to the three and six months ended MarchJune 31,30, 2025, is principally due to:
Higher volume of net sales and changes in product mix, which benefited operating income by approximately $2,500$1,700 and $4,100; offset by Higher commissionselling costsand administrative expenses of approximately$400 $600,and due$900, respectively, including higher commissions attributable to thean increase in commissionable sales of air handling units.units, and Employee-Retention Credits of $279 received in the second quarter of 2025.
Backlog at MarchJune 31,30, 2026 improved when compared to backlog at December 31, 2025 by approximately $23,458$46,806 with each of the product lines improving. In particular, backlog for:
Centrifugal pumps increased approximately $16,300 primarily due to strong order activity in the U.S. Navy and power generation markets.
HeatCentrifugal exchange coilspumps increased approximately $5,400$23,900 primarily due to strong order intakeactivity forin commercialthe OEMs;U.S. Navy and power generation markets, Air handling units increased approximately $1,800$14,500 primarily due to strong order activity in the pharmaceutical market.healthcare markets, and Heat exchange coils increased approximately $8,500 primarily due to strong order intake for commercial OEMs.
At MarchJune 31,30, 2026, approximately 28%54% of the segment's backlog is expected to ship after 2026.
The Corporation presents non-GAAP adjusted EBITDA and non-GAAP adjusted income from operations. Non-GAAP adjusted EBITDA is calculated as net income (loss) income excluding interest expense, other income (expense) - net, income tax provision, depreciation and amortization, and stock-based compensation along with significant charges or credits that are one-time charges or credits, unrelated to the Corporation’s ongoing results of operations, or beyond its control. Non-GAAP adjusted income from operations is calculated as income (loss) from operations excluding depreciation and amortization and stock-based compensation along with significant charges or credits that are one-time charges or credits, unrelated to the segment’s ongoing results of operations, or beyond its control. TheseDuring the six months ended June 30, 2026, these non-GAAP financial measures were adjusted to exclude the Deconsolidation Charge. Additionally,During the three and six months ended June 30, 2025, these non-GAAP financial measures were adjusted to exclude the severance and other exit costs component of U.K. Exit Charge (the accelerated depreciation component of the U.K. Exit Charge is included in depreciation and amortization) and the Employee-Retention Credits. These non-GAAP financial measures are not based on any standardized methodology prescribed by accounting principles generally accepted in the United States of America (“GAAP”) and may not be comparable to similarly titled measures presented by other companies.
The Corporation believes these non-GAAP financial measures help identify underlying trends in its business that otherwise could be masked by the effect of these items that it excludes from adjusted EBITDA and adjusted income from operations. The Corporation also believes these non-GAAP financial measures provide useful information to management, shareholders and investors, and others in understanding and evaluating its operating results, enhancing the overall understanding of its past performance and future prospects and allowing for greater transparency with respect to key financial metrics used by the Corporation’s management in its financial and operational decision-making. In particular, the Corporation believes the exclusion of the Deconsolidation Charge, the severance and other exit costs component of the U.K. Exit Charge and the Employee-Retention Credits can provide a useful measure for period-to-period comparisons of the Corporation’s core business performance.
Non-GAAP adjusted EBITDA and non-GAAP adjusted income from operations are not prepared in accordance with GAAP and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are limitations related to the use of non-GAAP adjusted EBITDA, rather than net income (loss) income,, or non-GAAP adjusted income from operations, rather than income (loss) from operations, which are the nearest GAAP equivalents. Among other things, there can be no assurance that additional expenses similar to the Deconsolidation Charge and the severance and other exit costs component of the U.K. Exit Charge or additional benefits similar to the Employee-Retention Credits will not occur in future periods.
AP insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 1 Form 4 filing (1 insider, 1 trade date, 3,300 shares, about $29.8K) and open-market sales in 2 filings (1 insider, 2 trade dates, 10,047 shares, about $99.5K). Net open-market shares: -6,747 (purchases minus sales); net value about -$69.7K.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-27 | Mcnair Darrell L |
Gift | 5,600 | — | — |
| 2026-06-25 | Lyon Samuel |
Open-market sale | 9,500 | $9.82 | $93.3K |
| 2026-06-18 | Lyon Samuel |
Open-market sale | 547 | $11.30 | $6.2K |
| 2026-05-19 | Mcbrayer Brett |
Open-market purchase | 3,300 | $9.03 | $29.8K |
| 2026-05-15 | Anderson David George |
Shares withheld for tax | 2,489 | $10.85 | $27.0K |
| 2026-05-15 | Anderson David George |
Shares withheld for tax | 1,370 | $10.85 | $14.9K |
| 2026-05-15 | Anderson David George |
Shares withheld for tax | 2,179 | $10.85 | $23.6K |
| 2026-05-15 | Anderson David George |
Shares withheld for tax | 8,216 | $10.85 | $89.1K |
| 2026-05-15 | Anderson David George |
Grant/award | 11,117 | — | — |
| 2026-05-15 | Lyon Samuel |
Shares withheld for tax | 3,547 | $10.85 | $38.5K |
| 2026-05-15 | Lyon Samuel |
Grant/award | 15,056 | — | — |
| 2026-05-15 | Lyon Samuel |
Shares withheld for tax | 18,185 | $10.85 | $197.3K |
| 2026-05-15 | Lyon Samuel |
Shares withheld for tax | 3,029 | $10.85 | $32.9K |
| 2026-05-15 | Lyon Samuel |
Shares withheld for tax | 3,166 | $10.85 | $34.4K |
| 2026-05-15 | Mcbrayer Brett |
Grant/award | 41,060 | — | — |
| 2026-05-15 | Mcbrayer Brett |
Shares withheld for tax | 46,656 | $10.85 | $506.2K |
| 2026-05-15 | Mcbrayer Brett |
Shares withheld for tax | 7,777 | $10.85 | $84.4K |
| 2026-05-15 | Mcbrayer Brett |
Shares withheld for tax | 8,568 | $10.85 | $93.0K |
| 2026-05-15 | Mcbrayer Brett |
Shares withheld for tax | 9,396 | $10.85 | $101.9K |
| 2026-05-15 | Mcnair Darrell L |
Grant/award | 7,374 | — | — |
| 2026-05-15 | Paul Laurence E |
Grant/award | 7,374 | — | — |
| 2026-05-15 | German Michael I |
Grant/award | 7,374 | — | — |
| 2026-05-15 | Lieberman William K |
Grant/award | 7,374 | — | — |
| 2026-05-15 | Fessenden Elizabeth Anne |
Grant/award | 7,374 | — | — |
| 2026-05-15 | Demichiei Robert |
Grant/award | 7,374 | — | — |
Well-known investors holding AP (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Renaissance Technologies | 2026-06-30 | 414,419 | $3.6M | 0.0% | Reduced 2% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 51,409 | $444.7K | 0.0% | Added 256% |
| Millennium Management (Israel Englander) | 2026-06-30 | 19,793 | $171.2K | 0.0% | Reduced 88% |