ATKR 10-K & 10-Q changes, risk factors and insider trading

The principal markets that we serve are highly competitive. Competition is based primarily on product offering, product innovation, quality, service and price. Our principal competitors range from national manufacturers to smaller regional manufacturers and differ by each of our product lines. See Item 1, “Business—Competition.” Some of our competitors may have greater financial and other resources than we do and some may have more established brand names in the markets we serve. The actions of our competitors, including adding production capacity and the expansion of imported products, may encourage us to lower our prices or to offer additional services or enhanced products at a higher cost to us, which could reduce our gross profit, net income or cash flows or may cause us to lose market share. There is also increasing use of data analytics, machine learning, and artificial intelligence software, which our competitors may be able to use or implement more effectively than we are able to do. Any of these consequences could materially and adversely affect our business, financial position, results of operations or cash flows.

Our business is also vulnerable to cyberattacks. Cyber incidents can result from deliberate attacks or unintentional events. Cybersecurity attacks in particular are becoming more sophisticated and more frequent and include, but are not limited to, malicious software, attempts to gain unauthorized access to data (either directly or through our vendors) for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption, “denial of service” attacks, phishing, untargeted but sophisticated and automated attacks and other disruptive software campaigns. The risk of cybersecurity attacks may increase as artificial intelligence capabilities improve and are increasingly used to identify vulnerabilities and construct increasingly sophisticated cybersecurity attacks. We have been, and likely will continue to be, subject to potential damage from cybersecurity attacks. Despite our security measures, our IT systems and infrastructure or those of our third parties may be vulnerable to such cyber incidents. The result of these incidents could include, but are not limited to, disrupted operations, misstated or misappropriated financial data, theft of our intellectual property or other confidential information (including of our customers, suppliers and employees), liability for stolen assets or information, increased cyber securitycybersecurity protection costs and reputational damage adversely affecting customer or investor confidence. In addition, if any information about our customers, including payment information, were the subject of a successful cybersecurity attack against us, we could be subject to litigation or other claims by the affected customers. We have incurred costs and may incur significant additional costs in order to implement the security measures we feel are appropriate to protect our IT systems. See Item 1C, “Cybersecurity.”

We believe import levels are affected by, among other things, overall worldwide product demand, the trade practices of the U.S. and foreign governments, the cost of freight, the challenges involved in shipping, government subsidies to foreign producers and governmentally imposed trade restrictions, such as quotas, tariffs, other trade barriers in the United States and government enforcement of such quotas, tariffs and trade barriers. Increased imports of products similar to those manufactured by us in the United States could materially and adversely affecteffect our business, financial position, results of operations or cash flows.

Our products can be assembled into interconnected skids to support plant operations and such assemblies have become accepted and used in the designs and construction of large scale manufacturing plants and data centers. The scale of these projects can push our products and services to over tens of millions of dollars or more. Supplying these complex assemblies poses unique challenges, which if not carefully discharged could subject us to warranty, indemnity and other contract obligations that could have a material affecteffect on our results of operations.

As of September 30, 2024,2025, approximately 20% of our domestic and international employees were represented with a collective bargaining agreement by labor unions. Several collective bargaining agreements to which the Company is a party,party. includingThe Company and the United Steelworkers Union reached agreement coveringon the Company’sterms productionof a new collective bargaining agreement for our largest facility in Harvey, Illinois, willwhich expireexpired in April 2024. In 2025, the Company reached an agreement with representatives of the United Steelworkers Union for a new 5-year labor contract for our Harvey, Illinois facility. The new contract is retroactive to April 2024. Work stoppages or production interruptions could occur at our facilities or our suppliers’ facilities. Such disputes may arise under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress or for other reasons. Any amendments to existing collective bargaining agreements, or the implementation of new collective bargaining agreements, could result in increased labor costs.

The majority of our net sales are facilitated through the extension of credit to our customers, and a significant asset included in our working capital is accounts receivable from customers. As of September 30, 2024,2025, Sonepar USA represented 17%13% and CED National represented 11%12% of the Company’s accounts receivable, with no significant amounts past due. As of September 30, 2023,2024, Sonepar USA represented 14%17% and CED National represented 11% of the Company’s accounts receivable with no significant amounts past due. For fiscal 2023,2025 and 2024, one customer, Sonepar USA accounted for more than 10% of sales, for fiscal 2022, no single customerUSA, accounted for more than 10% of sales. See Note 17,18, “Segment Information” to the accompanying consolidated financial statements included elsewhere in this Annual Report. If customers responsible for a significant amount of accounts receivable become insolvent or otherwise unable to pay for products and services, or become unwilling or unable to make payments in a timely manner, our business, financial position, results of operations or cash flows could be materially and adversely affected.

In addition, if we divest long-lived assets at prices below their asset value, we must write them down to fair value resulting in long-lived asset impairment charges, which could adversely affect our financial position or results of operations. See Note 12,13, “Goodwill and Intangible Assets” to the accompanying consolidated financial statements included elsewhere in this Annual Report. We cannot accurately predict the amount and timing of any impairment of assets, and we may be required to recognize goodwill or other asset impairment charges which could materially and adversely affect our results of operations. See “Item 8. Financial Statements and Supplementary DataData.”.

As of September 30, 2024,2025, we employed approximately 5,6005,400 total full-time equivalent employees, a significant percentage of whom work at our 4238 manufacturing facilities. Our business involves complex manufacturing processes and there is a risk that an accident resulting in property damage, personal injury or death could occur in one of our facilities. In addition, prior to the introduction of new products, our employees test such products under rigorous conditions, which could potentially result in injury or death. The outcome of any personal injury, wrongful death or other litigation is difficult to assess or quantify and the cost to defend litigation can be significant. As a result, the costs to defend any action or the potential liability resulting from any such accident or death or arising out of any other litigation, and any negative publicity associated therewith or negative effects on employee morale, could have a negative effect on our business, financial position, results of operations or cash flows. In addition, any accident could result in manufacturing or product delays, which could negatively affect our business, financial position, results of operations or cash flows. See Item 8, “Financial Statements and Supplementary DataData.”.

Our business operates and serves customers in certain foreign countries, including Australia, Belgium, Canada, China, Israel, New Zealand, and the United Kingdom. In additionaddition, thewe business isare pursuing work on data centers or other construction projects in other jurisdictions, for example in Asia and Europe. There are certain risks inherent in doing business internationally, including economic volatility and sustained economic downturns, difficulties in enforcing contractual and intellectual property rights, currency exchange rate fluctuations and currency exchange controls, import or export restrictions, sanctions and changes in trade regulations, difficulties in developing, staffing, and simultaneously managing a number of foreign operations as a result of distance, issues related to occupational safety and adherence to local labor laws and regulations, potentially adverse tax developments, longer payment cycles, exposure to different legal standards, political or social unrest, including terrorism, risks related to government regulation and uncertain protection and enforcement of our intellectual property rights, the presence of corruption in certain countries and higher than anticipated costs of entry.

We may be unable to identify, acquire, close or integrate acquisition targetstargets, or to execute divestitures, successfully.

As of September 30, 2024,2025, we had approximately $772.0$770.6 million of total long-term consolidated indebtedness outstanding (including current portion) under Atkore and AII’s credit facilities (“Credit Facilities”), which consist of: (i) an asset-based credit facility (“ABL Credit Facility”); (ii) the new senior secured term loan facility (the “New Senior Secured Term Loan Facility”); and (iii) the 4.25% Senior Notes due 2031 (the “Senior Notes”). As of September 30, 2024,2025, AII had $325.0 million of available borrowing capacity under the ABL Credit Facility and there were no outstanding borrowings (there were alsoand no letters of credit issued under the facility). Our indebtedness could have important consequences for you. Because of our indebtedness:

We and our subsidiaries may incur substantial additional indebtedness in the future. The terms of the credit agreements and indenture governing the Credit Facilities do not fully prohibit us or our subsidiaries from incurring additional debt. If our subsidiaries are in compliance with certain leverage or coverage ratios set forth in the agreements governing the Credit Facilities, they may be able to incur substantial additional indebtedness, which may increase the risks created by our current indebtedness. Subject to certain conditions and without the consent of the then existing lenders, the loans under the New Senior Secured Term Loan Facility may be expanded (or a new term loan facility, revolving credit facility or letter of credit facility added) by up to $235.0$456.0 million, plus an additional amount not to exceed specified leverage or coverage ratios. In addition, subject to certain conditions and withoutwith the consent of the then existing lenders, the loans under the ABL Credit Facility may be expanded by up to $150 million, and the credit agreements governing the Credit Facilities allow for up to $50.0 million of second lien facilities. As of September 30, 2024,2025, we had an additional $325.0 million in availability under the ABL Credit Facility.

Our overall corporate rating, Senior Notes, New Senior Secured Term Loan Facility and ABL Credit are each currently rated as investment grade by certain agenciesratings agencies, while the other agencies have rated them as non-investment grades.grade. Any rating, outlook or watch assigned could be lowered or withdrawn entirely by a rating agency if, in that rating agency’s judgment, current or future circumstances relating to the basis of the rating, outlook or watch, such as adverse changes to our business, so warrant. Any future lowering of our ratings, outlook or watch likely would make it more difficult or more expensive for us to obtain additional debt financing.

TheThere are no outstanding borrowings under the ABL Credit Facility areas scheduledof toSeptember mature30, on2025. May 26, 2026, theThe New Senior Secured Term Loan Facility has a maturity date that is the earlier of MaySeptember 26,29, 2028,2032 andor the date that is 91 days prior to the maturity of the Company’s existing Senior Notes, due June 1, 2031, if more than $100 million of such Senior Notes matureremains onoutstanding Juneas 1,of 2031.such date. We may be unable to refinance any of our indebtedness or obtain additional financing, particularly because of our indebtedness. Market disruptions, as well as our indebtedness levels, may increase our cost of borrowing or adversely affect our ability to refinance our obligations as they become due. If we are unable to refinance our indebtedness or access additional credit, or if short-term or long-term borrowing costs dramatically increase, our ability to finance current operations and meet our short-term and long-term obligations could be adversely affected.

We may be unable to maintain a level of cash flow from operating activities sufficient to permit us to pay dividends. If our cash flow and capital resources are insufficient, payment of declared dividends could be left unpaid. In the future, our cash flow and capital resources may not be sufficient for the continuation of any dividend programs approved by the board of directors. As a result, we may not be able to pay dividends or continue to pay dividends at the expected rate or at all in November 2024.all.

On November 16, 2021, the board of directors approved a share repurchase program (the “2021 Plan”), for the repurchase of up to an aggregate amount of $400.0 million of the Company’s common stock over a two-year period. On April 6, 2022, the board of directors approved an amendment to the 2021 Plan, extending it to a total repurchase of the Company’s outstanding stock of $800.0 million. On November 11, 2022, the board of directors approved an amendment to the 2021 Plan, extending it to a total repurchase authorization of the Company’s outstanding stock of $1,300 million. On May 2, 2024, the board of directors approved a new share repurchase program (the “2024 Plan”, and together with the 2021 Plan and amendments thereto, the “Plans”) which is scheduled to beginbegan after the repurchase authorization under the 2021 Plan haswas beenexhausted exhausted.in August 2024. The 2024 Plan authorizes the Company to repurchase up to $500.0 million of its outstanding stock. We expect that share repurchases under the Plans2024 Plan will be funded with cash on hand. The amount and timing of share repurchases will be based on a variety of factors. Important factors that could cause the Company to limit, suspend or delay its share repurchases include unfavorable trading market conditions, the price of the Company’s common stock, the nature of other investment opportunities presented to us from time to time, the ability to obtain financing at attractive rates and the availability of U.S. cash. The Plans2024 Plan does not obligate us to acquire any particular amount of common stock, and it may be terminated at any time at the Company’s discretion.

Our amended and restated certificate of incorporation includes provisions limiting the personal liability of our directors and certain officers for breaches of fiduciary duty under the DGCL.

Our amended and restated certificate of incorporation contains provisions relating to the liability of directors in response to claims arising under the General Corporation Law of the State of Delaware (“DGCL”). These provisions eliminate adirectors director’sand certain officers’ personal liability to the fullest extent permitted by the DGCL for monetary damages resulting from a breach of fiduciary duty, except in circumstances involving:

•any breach of the director’s or officer’s duty of loyalty;

•acts or omissions by the director or officer not in good faith or which involve intentional misconduct or a knowing violation of the law;

•soley with respect to a director, Section 174 of the DGCL (unlawful dividends); or

•any transaction from which the director or officer derives an improper personal benefit.benefit, or

The principal effect of the limitation on liability provision is that a stockholder will be unable to prosecute an action for monetary damages against a director or certain officer unless the stockholder can demonstrate a basis for liability for which indemnification is not available under the DGCL. These provisions, however, should not limit or eliminate our rights or any stockholder’s rights to seek non-monetary relief, such as an injunction or rescission, in the event of a breach of a director’s or officer’s fiduciary duty. These provisions do not alter a director’s or officer’s liability under federal securities laws. The inclusion of this provision in our amended and restated certificate of incorporation may discourage or deter stockholders or management from bringing a lawsuit against directors or officers for a breach of their fiduciary duties, even though such an action, if successful, might otherwise have benefited us and our stockholders.

Changes in international and domestic tax laws, including the reaction by states to federal legislation and changes in tax law enforcement, could negatively impact our tax provision, cash flow, or tax related balance sheet amounts. In particular, it is possible that U.S. federal income or other tax laws or the interpretation of tax laws will change, including as a result of possible tax legislation that may be proposed by the BidenTrump Administration. It is difficult to predict whether and when there will be tax law changes having a material adverse effect on our business, financial position, results of operations and cash flows.

Cost of sales includes all costs directly related to the production of goods for sale. These costs include direct material, direct labor, production related overheads, excess and obsolescence costs, lower-of-cost-or-market provisions, freight and distribution costs and the depreciation and amortization of assets directly used in the production of goods for sale.

Net sales for fiscal 2024 decreased $316.7 million to $3,202.1 million, a decrease of 9.0%, compared to $3,518.8 million for fiscal 2023. The decrease in net sales is primarily attributed to decreased average selling prices of $406.1 million,million and the economic value of solar tax credits to be transferred to certain customers of $38.3 million. These decreases are partially offset by increased sales volume of $122.6 million across varying product categories within both the Electrical and the Safety & Infrastructure segments.

Cost of sales decreased $55.0 million, or 2.5%, to $2,124.2 million for fiscal 20242024, compared to $2,179.3 million for fiscal 2023. The decrease was primarily due to lower input costs of steel, copper and PVC resin of $103.1 million and the benefit of solar tax credits of $84.0 million, partially offset by higher sales volume of $86.5 million and increased freight costs of $34.6 millionmillion.

Selling, general and administrative expenses increased $9.3 million, or 2.4%, to $397.5 million for fiscal 20242024, compared to $388.2 million for fiscal 2023. The increase was primarily due to digital initiatives of $10.0 million, increased headcount of $7.5 million, and increased compensation of $3.0 million. These increases were partially offset by increases in productivity of $6.0 million, lower sales commission expense of $4.1 million, and lower costs of $1.1 million spread across a variety of other spend categories.

Other (income) and expense, net

Other (income) and expense,income, net decreased $6.0 million to expense of $2.0 million for fiscal 2024, compared to expense of $8.0 million for fiscal 2023. The decrease in expense was primarily due to impairments recognized in fiscal 2023 in connection with the Company’s plans to exit from operations in Russia of $7.5 million.

Income tax expense decreased $46.0 million to $114.4 million,million for fiscal 2024, compared to $160.4 million for fiscal 2023. The Company's income tax rate increased to 19.5% for fiscal 2024, compared to 18.9% for fiscal 2023. The decrease in income tax expense iswas due to lower income before taxes, while the increase in effective tax rate was primarily due to the benefit of solar credits being recognized in cost of sales in fiscal 2024 where aswhereas the benefit of solar tax credits was recognized in income tax expense in fiscal 20232023, as described in the Summary of Significant Accounting Policies in Note 1, “Basis of Presentation and Summary of Significant Accounting Policies.” Additionally, see Note 7,8, “Income Taxes” to the accompanying consolidated financial statements included elsewhere in this Annual Report.

Net sales decreased by $320.1 million, or 12.0%, to $2,355.0 million for fiscal 20242024, compared to $2,675.1 million for fiscal 2023. The decrease in net sales is primarily attributed to lower average selling prices of $379.5 millionmillion, partially offset by increased sales volume of $54.3 million.

Net sales increased $4.9 million, or 0.6%, to $849.1 million for fiscal 20242024, compared to $844.2 million for fiscal 2023. The increase is primarily attributed to higher sales volumes of $68.3 million partially offset by lower average selling prices of $26.6 million and the economic value of solar tax credits to be transferred to certain customers of $38.3 million.

We believe we have sufficient liquidity to support our ongoing operations and to invest in future growth and create value for stockholders. Our cash and cash equivalents were $351.4$506.7 million as of September 30, 2024,2025, of which $101.8$106.6 million was held at non-U.S. subsidiaries. Those cash balances at foreign subsidiaries may be subject to withholding or local country taxes if the Company's intention to permanently reinvest such income were to change and cash was repatriated to the United States. Our cash and cash equivalents decreasedincreased $36.7$155.3 million from September 30, 2023,2024, primarily due to lower cash provided by operating activities and increased dividend payments, partially offset by less cash used in capital expenditures, acquisitions,expenditures and share repurchases.repurchases partially offset by lower cash provided operating activities.

In general, we require cash to fund working capital investments, acquisitions, capital expenditures, debt repayment, interest payments, taxes, dividends and share repurchases. We have access to the ABL Credit Facility to fund our operational needs. As of September 30, 2024,2025, there were no outstanding borrowings under the ABL Credit Facility (there wereand no standby letters of credit issued under the ABL Credit Facility). The borrowing base was estimated to be $325.0 million and approximately $325.0 million was available under the ABL Credit Facility as of September 30, 2024.2025.

Capital expenditures have historically been necessary to expand and update the production capacity and improve the productivity of our manufacturing operations and IT initiatives aimed to facilitate the ease of doing business with Atkore. In FY24,fiscal $149.92025, $107.1 million was spent on equipment, which included both routine capital expenditures and spending on growth initiatives such as Waterwater pipe and other product categories to support Global Megaprojects.

During fiscal 2024, we used $154.3 million of cash for investing activitiesactivities, compared to $302.2 million during fiscal 2023. The $147.8 million decrease in cash used byfor investing activities was primarily driven by $77.3 million in decreased cash used for acquisitions in fiscal 20242024, compared to fiscal 2023 and decreased capital expenditures of $69.0 million.

During fiscal 2024, we used $435.3 million for financing activitiesactivities, compared to $506.8 million during fiscal 2023. The decrease in cash used for financing activities during fiscal 2024 was primarily driven by repurchases of shares of $381.0 million in fiscal 20242024, as compared to $491.0 million of share repurchases in fiscal 2023, partially offset by dividends paid of $34.5 million in fiscal 2024.

ThereOther than as set forth below, there have been no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K.

The consolidated results of operations for the three months ended MarchJune 27,26, 2026 and MarchJune 28,27, 2025 were as follows:

Net sales increased by $29.7$59.8 million, or 4.2%,8.1%, to $731.4$794.8 million for the three months ended MarchJune 27,26, 2026, compared to $701.7$735.0 million for the three months ended MarchJune 28,27, 2025. The increase in net sales is primarily attributed to increased sales volume of $32.3$65.7 million, increased average selling prices of $10.2$22.4 million and foreign exchange benefits of $8.2$8.0 million partially offset by the impact of divestitures of $12.6$39.0 million.

Cost of sales increased by $78.7$55.5 million, or 15.2%,9.9%, to $595.3$618.5 million for the three months ended MarchJune 27,26, 2026 compared to $516.6$563.0 million for the three months ended MarchJune 28,27, 2025. The increase was primarily due to increased inputsinput costs of $82.1$48.9 million andmillion, increased sales volume of $19.4$48.8 million and foreign exchange impact of $6.4 million, partially offset by higher solar energy tax credits of $9.9 million the impact of recent divestitures $10.4$48.1 million.

Selling, general and administrative expenses increased by $8.9$10.5 million, or 9.0%,10.7%, to $107.9$108.7 million for the three months ended MarchJune 27,26, 2026 compared to $99.0$98.1 million for the three months ended MarchJune 28,27, 2025. The increase was primarily due to increased transaction and litigation costs of $9.8 million, increased compensation costs, net of productivity initiatives, of $5.1$3.7 million,million increasedand restructuringhigher costs of $3.5 million, and increased transaction costs of $3.8 million, partially offset by lower costs of $3.5$6.0 million across various other spend categories.categories, partially offset by the impact of recent divestitures and plant closures of $9.1 million.

Intangible asset amortization expense decreased to $6.3$3.6 million for the three months ended MarchJune 27,26, 2026 compared to $10.2$10.1 million for the three months ended MarchJune 28,27, 2025. The decrease in amortization expense resulted from certain intangibles becoming fully amortized oramortized, the amortizable base decreasing as a result of impairment charges recorded in fiscal 2025.2025 and the divestiture of the HDPE business in fiscal 2026.

Interest expense, net decreased by $1.3$1.9 million, or 15.4%21.7% to $7.0$6.9 million for the three months ended MarchJune 27,26, 2026 compared to $8.3$8.9 million for the three months ended MarchJune 28,27, 2025. The decrease is primarily due to decreased interest rates on the Company’s Senior Secured Term Loan Facility.

Litigation settlement expense increased to $136.5$50.0 million for the three months ended MarchJune 27,26, 2026 compared to no related expense for the three months ended MarchJune 28,27, 2025. The increase in expense is related to the settlement of twoone of the putative classes in the ongoing PVC antitrust litigation described in Note 16, “Commitments and Contingencies”.

Other expense,expense (income), net

The Company recognized $25.6$12.6 million of other expense for the three months ended MarchJune 27,26, 2026 compared to $6.4$0.2 million of other expenseincome for the three months ended MarchJune 28,27, 2025. This change is primarily due to athe lossdivestitures of $25.7the HDPE business and Vergo G&C which resulted in recorded losses of $10.5 million on HDPE assets and liabilities$1.2 designatedmillion, respectively, as held for saledescribed in theNote second3, quarter of fiscal 2026 compared the loss on sale of business of $6.1 million related to the sale of Northwest Polymers in fiscal 2025.“Divestitures”.

The Company’s income tax rate decreasedincreased to 21.8%113.4% for the three months ended MarchJune 27,26, 2026 compared to 24.7%22.0% for the three months ended MarchJune 28,27, 2025. The decreaseincrease in the current period effective tax rate was driven by the discrete impact of the impairmentPVC oflitigation the HDPE long-lived assetssettlement recorded in Q2the FY25.third quarter of fiscal 2026.

Net sales increased by $39.8$57.0 million, or 8.1%,10.9%, to $532.5$578.3 million for the three months ended MarchJune 27,26, 2026 compared to $492.7$521.3 million for the three months ended MarchJune 28,27, 2025. The increase in net sales is primarily attributed to increased sales volume of $28.4$62.8 million, foreign exchange benefits of $8.0 million and increased average selling prices of $6.5$13.7 million, partially offset by divestitures of businesses of $27.5 million.

Adjusted EBITDA for the three months ended MarchJune 27,26, 2026 decreasedincreased by $16.6$8.1 million, or 18.2%,10.0%, to $74.4$89.3 million from $90.9$81.2 million for the three months ended MarchJune 28,27, 2025. Adjusted EBITDA margin decreased to 14.0%15.4% for the three months ended MarchJune 27,26, 2026 compared to 18.5%15.6% for the three months ended MarchJune 28,27, 2025. The decreaseincrease in Adjusted EBITDA andwas primarily driven by increased sales volume while Adjusted EBITDA margin wasdecreased largely due to increases in input costs outpacing increases in average selling prices.

Net sales decreasedincreased by $10.2$2.9 million, or 4.9%,1.3%, for the three months ended MarchJune 27,26, 2026 to $199.1$216.8 million compared to $209.3$214.0 million for the three months ended MarchJune 28,27, 2025. The decreaseincrease is primarily attributed to an increase in average selling prices of $8.7 million, increased sales volume of $2.9 million, and lower solar credit rebates of $2.7 million, partially offset by the impact of recent divestitures of $9.5 million and higher solar credit rebates of $8.5 million, partially offset by increased sales volume of $3.9 million and an increase in average selling price of $3.7$11.5 million.

Adjusted EBITDA decreased by $18.8$2.6 million, or 52.0%,8.4%, to $17.3$28.1 million for the three months ended MarchJune 27,26, 2026 compared to $36.1$30.7 million for the three months ended MarchJune 28,27, 2025. Adjusted EBITDA margin decreased to 8.7%13.0% for the three months ended MarchJune 27,26, 2026 compared to 17.2%14.4% for the three months ended MarchJune 28,27, 2025. The decrease in Adjusted EBITDA and Adjusted EBITDA margin was largely due to higher input costs.costs outpacing increases in average selling prices.

The consolidated results of operations for the sixnine months ended MarchJune 27,26, 2026 and MarchJune 28,27, 2025 were as follows:

Net sales increased by $23.6$83.4 million, or 1.7%,4.0%, to $1,386.9$2,181.7 million for the sixnine months ended MarchJune 27,26, 2026, compared to $1,363.3$2,098.4 million for the sixnine months ended MarchJune 28,27, 2025. The increase in net sales is primarily attributed to increased sales volume of $47.6$113.3 million, higher average selling price of $14.6 million and foreign exchange benefits of $18.3 million, partially offset by the impact of divestitures of $17.7$56.8 million,million and the impact of solar credits rebates of $8.7 million and lower average selling prices of $7.9$6.0 million.

Cost of sales increased by $117.8$173.3 million, or 11.7%,11.0%, to $1,124.9$1,743.4 million for the sixnine months ended MarchJune 27,26, 2026 compared to $1,007.1$1,570.1 million for the sixnine months ended MarchJune 28,27, 2025. The increase in cost of sales was primarily due to higher input costs of $107.9$151.5 million andmillion, higher sales volume of $35.2$89.4 million,million and foreign exchange impacts of $15.3 million partially offset by higherlower solarfreight energy tax creditscosts of $9.3$34.4 million and the impact of recent divestitures of $16.1$64.3 million.

Selling, general and administrative expenses increased by $17.0$27.5 million, or 8.9%,9.5%, to $207.5$316.1 million for the sixnine months ended MarchJune 27,26, 2026, compared to $190.5$288.6 million for the sixnine months ended MarchJune 28,27, 2025. The increase was primarily due to increased transaction costsand of $10.0 million, increased restructuringlitigation costs of $4.7 million, increased spending on IT initiatives of $3.0 million, increased commissions of $1.4 million, increased costs of $0.6$19.9 million, compensation costs, net of productivity initiatives, of $0.9 million, $13.6 million spread across a variety of other spend categories,categories including restructuring, partially offset by lowerthe compensation expenses, netimpact of productivitydivestitures initiatives,and plant closures of $2.7$6.9 million.

Intangible asset amortization expense decreased to $12.6$16.2 million for the sixnine months ended MarchJune 27,26, 2026, compared to $21.9$32.0 million for the sixnine months ended MarchJune 28,27, 2025. The decrease in amortization expense resulted from certain intangibles becoming fully amortized oramortized, the amortizable base decreasing as a result of impairment charges recorded in fiscal 2025.2025 and the divestiture of the HDPE business in fiscal 2026.

Asset impairment charges decreased to $11.6 million for the sixnine months ended MarchJune 27,26, 2026 compared to $127.7 million for the sixnine months ended MarchJune 28,27, 2025. The decrease in asset impairment charges resulted primarily from the impairment charges recorded against the HDPE business in fiscal 2025 of $127.7 million compared to the fiscal 2026 impairments of goodwill related to the HDPE business of $6.5 million, as described in Note 4, “Assets Held for Sale”,million and impairment charges ofon $3,774other pertaining to operating lease right-of-use assets, as well as $1,279 associated with construction-in-progress assets,assets in connection with the closure of plants, as described in Note 6, “Restructuring Charges”. of $5.1 million.

Interest expense, net, decreased by $2.6$4.5 million, or 15.7%,17.8%, to $13.9$20.8 million for the sixnine months ended MarchJune 27,26, 2026, compared to $16.5$25.3 million for the sixnine months ended MarchJune 28,27, 2025. The decrease is primarily due to decreased interest rates on the Company’s Senior Secured Term Loan Facility.

Litigation settlement expense increased to $136.5$186.5 million for the sixnine months ended MarchJune 27,26, 2026 compared to no related expense for the sixnine months ended MarchJune 28,27, 2025. The increase in expense is related to the settlement of two classes in the ongoing PVC antitrust litigation described in Note 16, “Commitments and Contingencies”.

Other expense,expense (income), net

Other expense, net, increased to $23.3$35.9 million of expense for the sixnine months ended MarchJune 27,26, 2026, compared to $7.6$7.4 million of expense for the sixnine months ended MarchJune 28,27, 2025. This is primarily due to a loss on assets held for sale of $25.7 million related to the HDPE business and a gainnet loss on the saledivestitures of Tectron Tube of $2.3$10.4 million in fiscal 2026 compared to a loss on the sale of Northwest Polymers of $6.1 million in fiscal 2025.

The Company’s income tax rate decreasedincreased to 23.9%27.2% for the sixnine months ended MarchJune 27,26, 2026, compared to 53.0%16.8% for the sixnine months ended MarchJune 28,27, 2025. The decreaseincrease in the current period effective tax rate was driven by the discrete impact of the impairmentPVC oflitigation thesettlement HDPE long-lived assets and divestiture of Northwest Polymers LLCrecorded in the secondcurrent quarter of fiscal 2025.year.

Net sales increased by $44.0$101.0 million, or 4.6%,6.8%, to $1,002.0$1,580.3 million for the sixnine months ended MarchJune 27,26, 2026, compared to $958.0$1,479.3 million for the sixnine months ended MarchJune 28,27, 2025. The increase in net sales is primarily attributed to increased sales volume of $51.8$114.6 million andmillion, the impact of foreign exchange of $10.1$18.1 million,million partiallyand offset by decreasedincreased average selling prices of $11.6$2.1 millionmillion, andpartially offset by the impact of divestitures of $6.3$33.8 million.

Adjusted EBITDA for the sixnine months ended MarchJune 27,26, 2026 decreased by $53.9$45.8 million, or 29.4%,17.3%, to $129.5$218.8 million from $183.3$264.6 million for the sixnine months ended MarchJune 28,27, 2025. Adjusted EBITDA margin decreased to 12.9%13.8% for the sixnine months ended MarchJune 27,26, 2026, compared to 19.1%17.9% for the sixnine months ended MarchJune 28,27, 2025. The decrease in Adjusted EBITDA and Adjusted EBITDA margin was largely due to the increase in input costs asoutpacing well as the decreaseincreases in average selling prices.

Net sales decreased by $20.6$17.8 million, or 5.1%,2.9%, to $385.4$602.2 million for the sixnine months ended MarchJune 27,26, 2026, compared to $406.0$620.0 million for the sixnine months ended MarchJune 28,27, 2025. The decrease is primarily due to the impact of divestitures of $11.4$23.0 million, the higher economic valueimpact of solar energy tax creditscredit to be transferred to certain customersrebates of $8.7$6.0 million and thea decrease in volume of $4.2$1.3 million, partially offset by increased average selling prices of $3.7$12.5 million.

Adjusted EBITDA decreased $4.2$6.7 million, or 8.0%,8.2%, to $47.5$75.6 million for the sixnine months ended MarchJune 27,26, 2026, compared to $51.6$82.4 million for the sixnine months ended MarchJune 28,27, 2025. Adjusted EBITDA margin decreased to 12.3%12.6% for the sixnine months ended MarchJune 27,26, 2026, compared to 12.7%13.3% for the sixnine months ended MarchJune 28,27, 2025. The decrease in Adjusted EBITDA and Adjusted EBITDA margin was largely due to increases in input costs outpacing increases in average selling prices.

We believe we have sufficient liquidity to support our ongoing operations and to invest in future growth and create value for stockholders. Our cash and cash equivalents were $442.3$346.2 million as of MarchJune 27,26, 2026, of which $117.3$132.6 million was held at non-U.S. subsidiaries. Those cash balances at foreign subsidiaries may be subject to withholding or local country taxes if the Company’s intention to permanently reinvest such income were to change and cash was repatriated to the United States.

In general, we require cash to fund working capital investments, acquisitions, capital expenditures, debt repayment, interest payments, taxes, share repurchases and dividend payments. We have access to the ABL Credit Facility to fund operational needs. As of MarchJune 27,26, 2026, there were no outstanding borrowings under the ABL Credit Facility and no letters of credit issued under the ABL Credit Facility. The borrowing base was estimated to be $325.0 million and approximately $325.0 million was available under the ABL Credit Facility as of MarchJune 27,26, 2026. Outstanding letters of credit count as utilization of the commitments under the ABL Credit Facility and reduce the amount available for borrowings.

During the sixnine months ended MarchJune 27,26, 2026, the Company used $27.2$90.3 million cash flow in operating activities compared to generating $160.9$192.4 million during the sixnine months ended MarchJune 28,27, 2025. The $188.1$282.7 million decrease in cash provided was primarily due to changes in working capital and taxes payable. Net loss increased $105.3$147.5 million but was offset by an increase in transaction and impairment related non-cash charges of $37.3$36.4 million and an increase in other noncash adjustments, such as depreciation and deferred taxes, of $66.7$6.6 million. Changes in working capital represented $115.9$57.9 million of cash outflows primarily from the changeimpact of certain legal settlements and increases in accounts receivable dueand toincome thetaxes, timingpartially ofoffset whenby our fiscal second quarter ended. The remaining cash outflows were related to changesdecreases in income taxes payable $70.9 million.inventory.

During the sixnine months ended MarchJune 27,26, 2026, the Company used $8.1$26.1 million in investing activities compared to $48.0$69.3 million during the sixnine months ended MarchJune 28,27, 2025. The $39.9$43.2 million decrease in cash used in investing activities was primarily due to a decrease of $37.4$44.5 million in capital expenditures and an increase in proceeds from the sale of a businessbusinesses of $11.7$22.6 million, partially offset by less proceeds from the sale of equipment of $7.4$7.1 million and cash contributed to a divested business of $15.0 million.

During the sixnine months ended MarchJune 27,26, 2026, the Company used $28.5$41.4 million in financing activities compared to $129.2$143.1 million used during the sixnine months ended MarchJune 28,27, 2025. The decrease in cash used in financing activities is primarily due to $100.0 million less cash used to repurchase common stock during the sixnine months ended MarchJune 27,26, 2026.