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

The Company’s business may be materially adversely affected by market conditions and byconditions, global and economic conditions and other factors beyond its control.

•consumer credit availability and consumer debt levelslevels, including tightening lending standards or increased credit defaults;

•uncertainties relating to, and the potential for unfavorable economic conditions in the United States, the U.K., continental Europe, Asia and elsewhere;

•political unrest, war, terrorism, geopolitical uncertainties, trade policies and sanctions, including the repercussions of the militaryongoing conflictconflicts between Russia and the Ukraine, conflicts in Ukraine,the IsraelMiddle East, and surroundingincreasing areastensions between China and Taiwan (and any broadening of the conflict);

•unstable economic and political conditions, lack of legal regulation enforcement, civil unrest and potential accompanying shifts in laws and regulations; and The occurrence of negative events related to any of the foregoing may adversely impact the Company’s results of operations and financial condition.

The Company designs, sources and sells branded kitchenware, tableware and other homeware goods and relies on third parties to manufacture its products who are, in turn, subject to changes in their underlying manufacturing costs. The Company also relies on third parties for transportation and is exposed to fluctuations in freight costs to transport goods as well as the price of fuel and gasoline. These prices may fluctuate based on a number of factors beyond the Company’s control, including from geopolitical conditions such as the military conflictfluctuations in Ukraineraw material costs (including metals, plastics and resultingpackaging sanctionsmaterials), imposedlabor bycosts theat U.S.third-party manufacturing facilities, ocean freight and othercontainer countries.rates, Inflationport hascongestion, resultedfuel and couldenergy continueprices and changes in tariffs or duties applicable to resultimported in significant cost increases.goods. If the Company is unable to mitigate any cost increases from the foregoing factors through various customer pricing actions and cost reduction initiatives, its financial condition may be adversely affected. Conversely, in the event that there is deflation, the Company may experience pressure from its customers to reduce prices. There can be no assurance that the Company would be able to reduce its cost base to offset any such price concessions, which could adversely impact its results of operations and cash flows.

ATariff majorityrates, ofproduct theclassifications Company’sand productsenforcement arepractices sourcedmay from vendors outside the U.S. During the last several years there have also been significant changescontinue to U.S.change trade policies, sanctions, legislation, treaties and tariffs, including, but notwith limited to, trade policiesnotice and tariffs affecting products from outside of the U.S. For example, in early 2025, the current U.S. presidential administration announced significant new tariffs on foreign imports into the U.S., specifically from Mexico, Canada, and China, and has proposed additional new tariffs that may be implementedapplied inretroactively theor future.expanded to additional product categories. Given the Company’s reliance upon non-domestic suppliers, primarily China, any significant changes to the U.S. trade policies (and those of other countries in response) or changes without sufficient notice may cause a material adverse effect on its ability to source products from other countries or significantly increase the costs of obtaining such products, which could result in a material adverse effect on our financial results. The extent and duration of increased tariffs and the resulting impact on general economic conditions and on our business are uncertain and depend on various factors, such as negotiations between the U.S. and affected countries, the responses of other countries or regions, exemptions or exclusions that may be granted, availability and cost of alternative sources of supply, and demand for our products in affected markets. Any new or additional tariffs on goods imported to the U.S. from China, Mexico, Canada, or other countries, or products imported into the European Union or other non-U.S. markets, could also increase the cost of some of our products and reduce our margins. In response to the tariffs,tariffs imposed in 2025, the Company mayhas seeknegotiated toprice increase pricesincreases to its U.S. customers, whichnegotiated maylower diminishproduct demandcosts forwith its products.foreign suppliers and pursues diversification of its foreign sourced products to countries that are expected to be subject to lower tariffs. The imposition of additional tariffs or other trade barriers could increase our costs in certain markets and may cause our customers to find alternative sourcing or could make it more difficult for us to sell our products in some markets. In addition, increased review by U.S. Customs and Border Protection or other regulatory authorities, including with respect to country-of-origin determinations, supply chain compliance, or sanctions requirements, may result in administrative delays or additional compliance costs. Other countries where we operate or sell our products have changed, and may continue to change, their own policies on trade as well as business and foreign investment in their respective countries. Additionally, it is possible that U.S. policy changes and uncertainty about such changes could increase market volatility and currency exchange rate fluctuations. As a result of these dynamics, we cannot predict the impact to our business of any future changes to the U.S.’s or other countries’ trading relationships or the impact of new laws or regulations adopted by the U.S. or other countries.

The Company is generally not fully insured against all significant losses. For example, the Company is not fully insured against hurricane, earthquake, acts of war, and terrorism related losses.losses, cybersecurity incidents, pandemics, or certain other climate-related events. In addition, certain policies may contain exclusions, sublimits, higher deductibles or self-insured retentions that could limit recoveries. A loss for which the Company is not fully insured or for which insurance proceeds are insufficient or delayed, could have a material adverse effect on the business, financial condition, results of operations and prospects.

The ABL Agreement, under certain circumstances, requires the Company to maintain a certain fixed charge coverage ratio. The Term Loan requires the Company to maintain a maximum Total Net Leverage Ratio of 5.00 to 1.00 as of the last day of its fiscal quarters. As a result of this and other covenants within the Debt Agreements, the Company may be limited in its ability to incur additional debt, make investments or undertake certain other business activities.activities, including restrictions on asset sales, dividends, share repurchases, affiliate transactions and the granting of liens. These requirements could limit the Company’s ability to obtain future financing and may prevent the Company from taking advantage of attractive business opportunities. The Company’s ability to meet the covenants or requirements in its Debt Agreements may be affected by events beyond the Company’s control, and the Company may not be able to satisfy such covenants and requirements. A breach of these covenants or the Company’s inability to comply with the restrictions could result in an event of default under the Debt Agreements, which in turn could result in an event of default under the terms of the Company’s other indebtedness. Upon the occurrence of an event of default under the Company’s Debt Agreements, after the expiration of any grace periods, the Company’s lenders could elect to declare all amounts outstanding under the Company’s debt arrangements, together with accrued interest, to be immediately due and payable. If this happens, the Company cannot assure that its assets would be sufficient to repay in full the amounts due under the Debt Agreements or the Company’s other indebtedness.

The Company’s borrowings bear interest at floating rates. An increase in interest rates would adversely affect the Company’s profitability. For example, in 20242025 interest expense increaseddecreased by $0.5$2.2 million compared to the prior year as a result of a higherlower interest rate environment, partially offset byand lower average outstanding borrowings. To the extent that the Company’s access to credit may be restricted because of its own performance, its bank lenders’ performances or conditions in the capital markets generally, the Company would not be able to operate normally.

The Company’s Receivables Purchase Agreement also depends upon the Secured Overnight Financing rate (“SOFR”), as it is a component of the discount rate applicable to the agreement. If SOFR increases, the Company may not be able to rely on the Receivables Purchase Agreement, which could have a material and adverse effect upon the Company’s financial condition, results of operations and cash flows. Changes in benchmark interest rates, including the replacement or modification of SOFR or the application of credit spreads or benchmark adjustments, could further increase financing costs or create uncertainty in the calculation of amounts payable under the Company’s debt and receivables facilities. In addition, the Company’s ability to access the Receivables Purchase Agreement may depend on the continued eligibility of receivables sold thereunder and the financial condition of the purchasers or other counterparties.

•potential unknown liabilities and unforeseen increased expenses or delays associated with the acquisition.acquisition, including contingent liabilities, litigation exposure, tax exposures, environmental matters, compliance deficiencies or indemnification disputes; and

The Company’s functional currency is the U.S. dollar. Changes in the relation of foreign currencies to the U.S. dollar will affect the Company’s sales and profitability and can result in exchange losses because the Company has operations and assets located outside the United States. The Company, especially its foreign subsidiaries and affiliates, transacts business in currencies other than the U.S. dollar, primarily U.K. pounds, and to a lesser degree, Australian dollars, Chinese renminbi, Euros, Hong Kong dollars, New Zealand dollars, Mexican peso and Canadian dollars. Such transactions affect the Company’s operating results and financial condition. Foreign operations expose the Company to foreign currency fluctuations, for both transactions and financial reporting translation purposes. In the consolidated financial statements, local currency financial results are translated into U.S. dollars based on the exchange rates prevailing during the reporting periods. During times of a strengthening U.S. dollar, the reported revenues and earnings of the Company’s international operations will be reduced because the local currencies will translate into fewer U.S. dollars. As described below, during times of a weakening U.S. dollar, the Company’s costs related to the supplies and inventory it sources internationally will increase. Foreign exchange markets have experienced significant volatility in recent periods, and geopolitical tensions, inflation differentials, monetary policy divergence and capital market disruptions may contribute to continued volatility.

The vast majority of the Company’s inventory is purchased from Chinese suppliers in U.S. dollars, including inventory purchased by the Company’s international operations. As a result, the gross margin from international operations is subject to volatility from movements in exchange rates, which could have an adverse effect on the financial condition and results of operations and profitability from international operations. TheIn addition, there may be a timing lag between exchange rate movements and the Company’s ability to adjust pricing, which could compress margins. From time to time, the Company has enteredenters into foreign exchange derivative contracts to hedge the volatility of exchange rates related to a portion of its international inventory purchases. The Company cannot ensure, however, that these hedges will fully offset the impact of foreign currency rate movements. If the Chinese renminbi should appreciate against the U.S. dollar, the costs of the Company’s products will likely rise over time because of the impact the strengthening renminbi will have on the Company’s cost of sales, and the Company may not be able to pass on these price increases to its customers. The Company is also subject to the risks of currency controls and devaluations. Currency controls may limit the Company’s ability to convert currencies into U.S. dollars or other currencies, as needed, to pay dividends or make other payments from funds held by subsidiaries in countries imposing such controls, which could adversely affect the Company’s liquidity.

In order to operate more efficiently and control costs, the Company may announce restructuring plans from time to time, including workforce reductions, global facility consolidations and other cost reduction initiatives that are intended to generate operating expense savings. These initiatives may require upfront cash expenditures, including severance, lease termination costs, asset write-offs and other restructuring charges. The implementation of restructuring plans could be disruptive to the Company’s operations, result in higher than anticipated charges and otherwise adversely affect the Company’s results of operations and financial condition. Workforce reductions may also result in the loss of key personnel, decreased employee morale, or challenges in recruiting and retaining talent. In addition, the Company’s ability to complete restructuring plans and achieve the anticipated benefits from a plan is subject to estimates and assumptions and may vary materially from the Company’s expectations, including as a result of factors that are beyond the Company’s control. Furthermore, following completion of a restructuring plan, the business may not be more efficient or effective than prior to implementation of the plan.

A portion of the Company’s long-term assets consists of goodwill recorded as a result of the Company’s acquisitions; other identifiable intangible assets, including trade names; and long-lived assets. At December 31, 2024, goodwill, net of accumulated impairment charges totaled $33.2 million;2025, finite-lived intangible assets, net of accumulated impairment charges and accumulated amortization totaled $150.3$132.9 million. TheThese Companyassets doesare not amortize goodwill but rather reviews itreviewed for impairment on an annual basis or more frequently whenwhenever events or changes in circumstances indicate that itsthe carrying valueamount may not be recoverable. If the carrying value of a reporting unit exceeds its current fair value as determined based on the discounted future cash flows of the reporting unit or comparable market sales and earnings multiples, the goodwill or intangible asset is considered impaired and is reduced to fair value. Events and conditions that could result in impairment include a prolonged period of global economic weakness, a decline in economic conditions and/or a slow, weak economic recovery, as well as sustained declines in the price of the Company’s common stock, adverse changes in the regulatory environment, adverse changes in the market share of the Company’s products, adverse changes in interest rates, further corporate income tax reforms or other factors leading to reductions in the long-term sales or profitability that the Company expects. Determination of the fair value of a reporting unit includes developing estimates, which are highly subjective and incorporate calculations that are sensitive to minor changes in underlying assumptions. Management’s assumptions change as more information becomes available. Changes in these assumptions could result in an impairment charge in the future, which could have a significant adverse impact on the Company’s reported earnings. If the futureundiscounted operatingcash performanceflows ofexpected oneto orbe moregenerated ofby thethese Company’sassets operatingare segmentsless doesthan nottheir meetcarrying expectations,amounts, the Company maywould be required to record aan significantimpairment charge duringequal to the periodexcess inof whichthe anycarrying value over fair value. The recognition of an impairment of the Company’s goodwill or other long-term assets iswould determined.negatively affect the Company’s results of operations and total capitalization, the effect of which could be material.

From time to time, the Company may provide projections to its stockholders, lenders, the investment community, and other stakeholders of the Company’s future sales and net income. Since the Company does not have long-term purchase commitments from customers and the customer order and shipment process is very short, it is difficult for the Company to accurately predict the demand for many of its products, or the amount and timing of the Company’s future sales and related net income. The Company’s projections are based on management’s best estimate of sales using historical sales data and other information deemed relevant. These projections are highly subjective since sales can fluctuate substantially based on the demands of retail customers and due to other risks described in this Annual Report. Additionally, changes in retailer inventory management strategies could make the Company’s inventory management more difficult. Because the Company’s ability to forecast product demand and the timing of related sales requires significant subjective input, future sales and net income could vary materially from the Company’s projections.projections, and any such variances could adversely affect the Company’s stock price, liquidity, covenant compliance or investor confidence.

The Company self-insures a substantial portion of the costs of employee healthcare and workers compensation. This could result in higher volatility in the Company’s earnings and exposes the Company to higher financial risks. The Company’s medical costs in recent years have generally increasedincreased, reflecting healthcare cost inflation and otherhigher utilization trends and changes in employee demographicsdemographics, claims experience, or the severity of claims could result in anmedical increaseand inworkers’ medicalcompensation costs beyondthat whatexceed the CompanyCompany’s has experiencedexpectations or expects.established reserves. The Company has stop-loss coverage in place for catastrophic events, but the aggregate impact of a high number of claims up to the Company’s stop-loss limit may have an effect on the Company’s profitability.

The Company does not expect that its disclosure controls or the Company’s internal controls over financial reporting will prevent or detect all errors and allor fraud. A control system, no matter how well-designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that resource constraints exist, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of the effectiveness of controls to future periods are subject to risks. Over time, controls are revised, as necessary, due to changes in conditions or deterioration in the degree of compliance with policies or procedures. In addition, increased reliance on information technology systems and evolving cybersecurity threats may place additional strain on the Company’s control environment. If in the future the Company’s controls become inadequate, it could fail to meet its financial reporting obligations, its reputation may be adversely affected, its business and operating results could be harmed, and the market price of its stock could decline.

The Company’s wholesale customers include mass market merchants, specialty stores, department stores, warehouse clubs, grocery stores, off-price retailers, dollar channel retailers, food service distributors, food and beverage outlets, corporate sales and e-commerce.e-commerce retailers and marketplaces. Unanticipated changes in purchasing and other practices by the Company’s customers, including a customer’s pricing and payment terms, inventory de-stocking, limitations on shelf space, more extensive packaging requirements, changes in order quantities, use of private label brands and other practices, could materially and adversely affect the Company’s business, results of operations and financial condition. In addition, as a result of the desire of retailers continue to more closely manage inventory levels and optimize their supply chains, retailers may evaluate suppliers based on their ability to deliver orders at the quantity and schedule specified, which is known as the "on-time-in-full" delivery metric. Supply-chain complexity and customer demand for on-shelf availability creates additional pressure on delivery performance, which in turn can add strain on distribution channels. The Company’s annual earnings and cash flows also depend to a great extent on the results of operations in the latter half of the year due to the seasonality of its sales. The Company’s success and sales growth is also dependent on its evaluation of consumer preferences and changing trends.

During the years ended December 31, 2024,2025, 20232024 and 2022,2023, Wal-Mart Stores, Inc. (“Walmart”), accounted for 19%,17%, 21%19% and 19%21% of consolidated net sales, respectively. During the years ended December 31, 2024,2025, 20232024 and 2022,2023, sales to Amazon accounted for 12%, 13% and 11% of consolidated net sales, respectively. During the years ended December 31, 2025, 2024 and 2023, sales to Costco Wholesale Corporation (“Costco”) accounted for 11%, 11%, and 13%11% of consolidated net sales.sales, respectively. During the year ended December 31, 2024,2025, 2023sales andto 2022, Amazon.com Inc., (“Amazon”),TJX accounted for 13%, 11% and 11% of consolidated net sales. Sales to CostcoAmazon and AmazonTJX are included in the Company’s U.S. and International segments. Sales to Walmart and Costco are included in the Company’s U.S. segment. No other customers accounted for 10% or more of the Company’s sales during these periods.

A material reduction in sales to the aforementioned or other top customers in the aggregate, could haveadversely a significant adverse effect onaffect the Company’s business and operating results. In addition, pressures by suchLarge customers thatmay wouldseek causeprice thereductions, Companyextended topayment materiallyterms, promotional support or other concessions, which could reduce the price of its products could result in reduced sales and operating margin.margins. Any significant changes or financial difficulties that affect these customers, such as reduced sales by such customers (whether for reasons that affect a particular customer or the retail industry in general) may also result in reduced demand for the Company’s products. The Company would also be subject to increased credit risk with respect to such customers. In particular, the concentration of the Company’s business with Walmart, CostcoCostco, Amazon and AmazonTJX extends to its international business as well as through the Company’s strategic alliance in Canada, due to the market presence of Walmart, CostcoCostco, Amazon and AmazonTJX in these foreign countries. Any changes in purchasing practices or decline in the financial condition, of Walmart, CostcoCostco, Amazon and AmazonTJX or other large customers, may have a material adverse impact on the business, results of operations and financial condition of the Company.

The success of the Company’s online business depends, in part, on factors over which the Company may have limited control. The Company must successfully respond to changing consumer preferences and online buying trends. The Company is also vulnerable to certain additional risks and uncertainties associated with operating an online business, including: changes in required technology interfaces, website downtime and other technical failures, costs and technical issues as the Company upgrades its website software, computer viruses, changes in applicable federal and state regulations, security breaches, data breaches, and consumer privacy concerns. In addition, the Company must keep up to date with competitive technology trends, including the use of improved technology, artificial intelligence-driven search or recommendation platforms, creative user interfaces and other online marketing tools such as paid search, which may increase its costs and which may not succeed in increasing sales or attracting customers. The Company’s failure to successfully respond to these risks and uncertainties might adversely affect the sales in its online business, as well as damage the Company’s reputation and brands.

New product introductions and product innovation are significant contributors to the Company’s growth strategystrategy. and theThe Company’s long-term success in the competitive retail environment depends in part on the Company’s ability to develop and market a continuing stream of innovative new products that meet changing consumer preferences. The uncertainties associated with developing and introducing new products, such as the market demands and the costs of development and production may impede the successful development and introduction of new products. Acceptance of the new products may not meet sales expectations due to several factors, such as the Company’s failure to accurately predict market demand or its inability to resolve technical issues in a timely and cost-effective manner. Additionally, the inability to develop new products on a timely basis could result in the loss of business to competitors.

The Company’s reliance on international suppliers subjectsubjects the Company to regional regulatory, man-made or natural disasters, health epidemics, political or military conflicts, economic and foreign currency exchange risk that could materially and adversely affect the Company’s operating results.

The Company sources its products from suppliers located principally in Asia, Europe and the United States, which subjects the Company to various risks, including man-made or natural disasters, adverse macroeconomic conditions (including inflation, slower growth, and recession), and foreign currency changes, all of which could create disruptions in ourits supply chain. Similarly, geopolitical risks, including instability resulting from civil unrest, political demonstrations, strikes and armed conflict or other crises, such as conflicts in Ukraine, Israelthe Middle East and surrounding areas (and any broadening of the conflict), and resulting sanctions could change the global supply chain dynamics and demand. Additionally, the Company’s vendors in Asia, from whom a substantial majority of the Company’s products are sourced, are located primarily in China, which subjects the Company to regional risks including regulatory, social and other risks in addition to the risks resulting from tensions between the United States and China involving trade policies and certain regulatory actions. The Company’s ability to select and retain reliable vendors and suppliers who provide timely deliveries of quality parts and products efficiently will impact its success in meeting customer demand for timely delivery of quality products. The Company’s sourcing operations and its vendors are impacted by labor costs in China, where labor historically has been readily available at low cost relative to labor costs in North America. However, as China is experiencing rapid social, political and economic changes, labor costs have risen in some regions and labor in China may not continue to be available to the Company at costs consistent with historical levels. Changes in labor or other laws may be enacted, in China or in other countries in which the Company does business, which could have a material adverse effect on the Company’s operations and/or those of the Company’s suppliers. In addition, any indirect supply chain disruptions due to the conflictDisruptions in Ukraine, Israel and surrounding areas (and any broadening of the conflict), may further complicate existing supply chain constraints. Specifically, in connection with the conflict in Israel and the surrounding areas, the Houthi movement, which controls parts of Yemen, has launched a number of attacks on marine vessels in the Red Sea. The Red Sea is an important maritime routetrade forroutes internationalor trade.other Astransportation achannels could result of such disruptions, the Company may experience in the future extended lead times, delivery delays in supplier deliveries, and increased freight costs. The risk of ongoing supply disruptions may further result in delayed deliveries of our products. Changes in currency exchange rates might negatively affect the Company and its overseas vendors’ profitability and business prospects. The Company does not have access to its vendors’ financial information and the Company is unable to assess its vendors’ financial condition, including their liquidity. Interruption of supplies from any of the Company’s vendors, or the loss of one or more key vendors, could have a negative effect on the Company’s business and operating results. A disruption in deliveries to or from suppliers or decreased availability of materials could have an adverse effect on our ability to meet our commitments to customers or increase our operating costs. A disruption from such third‑party suppliers, manufacturers or service providers, capacity constraints, production disruptions, price increases, quality control issues, recalls or other decreased availability of parts and products could adversely affect our ability to meet our commitments to customers and have a material adverse effect on our business, financial condition and results of operations.

The Company imports its products for delivery to its distribution centers, as well as arranges for its customers to import goods to which title has passed overseas or at a port of entry. For purchases that are to be delivered to its distribution facilities, the Company arranges for transportation, primarily by sea, from ports in Asia and Europe to ports in the United States, principally New York/Newark/Elizabeth and Los Angeles/Long Beach, and in the U.K., principally Felixstowe. Accordingly, the Company is subject to risks incidental to such transportation. These risks include, but are not limited to, increases in fuel costs, fuel shortages, the availability of ships, increased security restrictions, transportation reroutes in response to geopolitical conflict, work stoppages, weather disruptions and carriers’ ability to provide delivery services to meet the Company’s shipping needs. Port congestion or other disruptions affecting major shipping lanes or ports may also delay deliveries. Transportation disruptions and increased transportation costs could materially adversely affect the Company’s business, results of operations and financial condition.

The Company holds certain rights to use the Farberware brand for kitchen tools, cutlery, cutting boards, shears and certain other products which together represent a material portion of its sales, through a fully-paid, royalty-free license for a term that expires in 2195, subject to earlier termination under certain circumstances. The licensor is a joint venture of which the Company is a 50% owner. The other 50% owner of the joint venture has the right to terminate the Company’s license if the Company materially breaches any of the material terms of the license and fails to cure the material breach within 180 days of notice of the breach, if it is determined in an arbitration proceeding that money damages alone would not be sufficient compensation to the licensor and that the breach is so egregious as to warrant termination of the license and forfeiture of the Company’s rights to use the brand under that license agreement. If the Company were to lose the Farberware license for kitchen tools, cutlery, cutting boards, shears and certain other products through termination as a result of an uncured breach, its business, results of operations and financial condition would be materially adversely affected.

The Company may need to resort to litigation to enforce or defend its intellectual property rights. If a competitor or collaborator files a patent application claiming technology also claimed by the Company, or a trademark application claiming a trademark, service mark or trade dress also used by the Company, in order to protect the Company’s rights, the Company may have to participate in opposition or interference proceedings before the U.S. Patent and Trademark Office or a similar foreign agency. The Company cannot guarantee that the operation of its business does not infringe or otherwise violate the intellectual property rights of third parties, and the Company’s intellectual property rights may be challenged by third parties or invalidated through administrative process or litigation. Third parties may assert infringement or other intellectual property claims against the Company, which could result in costly litigation, settlements, licensing arrangements or restrictions on the manufacture, marketing or sale of certain products. The costs associated with protecting intellectual property rights, including costs associated with litigation or administrative proceedings, may be material and there can be no assurance that any such litigation or administrative proceedings will be successful. Any such matters or proceedings could be burdensome, divert the time and resources of the Company’s personnel and the Company may not prevail. Furthermore, even if the Company’s intellectual property rights are not directly challenged, disputes among third parties could lead to the weakening or invalidation of the Company’s intellectual property rights, or other parties such as the Company’s competitors may independently develop technologies that are substantially equivalent or superior to the Company’s technology.

If the Company is unable to protect the confidentiality of its proprietary information and know-how, the value of the Company’s technology, products and services could be harmedmaterially significantly.adversely affected.

In addition to registered intellectual property, the Company relies on know-how and other proprietary information in operating its business. If this information is not adequately protected, then it may be disclosed or used in an unauthorized manner. To the extent that consultants, vendors, key employees or other third parties apply technology independently developed by them or by others to the Company’s proposed products in the absence of a valid license or suitable non-disclosure or assignment of inventions provisions, disputes may arise as to the ownership of or rights to use such technology, which may not be resolved in the Company’s favor. If other parties breach confidentiality or other agreements, or if the Company’s registered intellectual property is not protected in the U.S. or foreign jurisdictions, this could harm the Company by enabling the Company’s competitors and other entities, who may have greater experience and financial resources, to copy or use the Company’s proprietary information in the advancementdevelopment of their products, methods or technologies.

The Company’s brands and its reputation are among its most important assets. The Company’s ability to attract and retain customers depends, in part, upon external perceptions of the Company, the quality of its products and its corporate and management integrity. TheConsumer-facing consumerbusinesses goodsare industryparticularly is by its nature more pronevulnerable to reputational risksharm, than other industries. This has been compounded in recent years by the free flow of unverified information on the Internet and, in particular, on social media. Damage to the Company’s brands or reputation oras negative publicity or perceptions aboutcan therapidly Companyinfluence couldpurchasing adverselydecisions affectand itsretailer business.relationships.

The Company conducts business outside of the United States through subsidiaries, affiliates and joint ventures. These entities have operations and assets in the U.K., Mexico,the Netherlands, Canada, ChinaChina, Hong Kong, Australia, New Zealand and Hong Kong.Mexico. Therefore, the Company is subject to increases and decreases in its investments in these entities resulting from the impact of fluctuations in foreign currency exchange rates. These entities also bear risks similar to those risks faced by the Company. However, there are specific additional risks related to these organizations,operations, such asincluding the failure of the Company’s partners or other investors to meet their obligationsobligations, governance or compliance failures, and higher credit and liquidity risks related to thinly capitalized entities. Failure of these entities or the Company’s vendors to adhere to required regulatory or other standards, including social compliance standards, could materially and adversely impact the Company’s reputation and business.

•U.S.-imposed embargoes ofand sanctions on sales to specific countries;

•war, civil uprisingsunrest and riots;

•unanticipated income taxes, excise duties, import taxes, export taxes or other governmental assessments;

•locating and entering into agreements with third-party logistics providers to assist in certain locations outside the United States. In addition, the development of additional distribution space abroad involves significant financial and operational risks; and

•difficulties in managing a global enterprise.enterprise; and

Any significant violations of regulations or the occurrence of the events listed above could result in civil or criminal sanctionssanctions, monetary fines, reputational harm, or the loss of export or other licenses, which could have a material adverse effect on the Company’s business, results of operations and financial condition. In addition, the Company’s organizational structure may limit its ability to transfer funds between countries, particularly into and out of the United States, without incurring adverse tax consequences. Regulatory restrictions may also limit the Company’s ability to transfer funds in certain jurisdictions. Any of these events could result in a loss of business or other unexpected costs that could reduce sales or profits and have a material adverse effect on the Company’s financial condition, results of operations and cash flows.

The Company is subject to laws and regulations governing the Internet and e-commerce. These existing and future laws and regulations may impede the growth of the Internet, e-commerce or other online services. These regulations and laws may cover taxation, user privacy, data protection, pricing, content, copyrights, distribution, electronic contracts and other communications, consumer protection, the provision of online payment services, broadband residential Internet access and the characteristics and quality of products and services. It is not clear how existing laws governing issues such as property ownership, sales and other taxes, and personal privacy apply to the Internet and e-commerce. Unfavorable resolutions of these issues could diminish the demand for the Company’s products on the Internet and increase the cost of doing business. For example, in 2018, the U.S. Supreme Court ruling in South Dakota v. Wayfair, Inc. et al reversed the longstanding precedent that remote sellers are not required to collect state and local sales taxes and established that a state may enforce or adopt laws requiring online retailers to collect and remit sales tax if there is a substantial nexus between the online retailer’s activity and the state, even if the retailer has no physical presence within the taxing state. While the Company now collects, remits and reports sales tax in states thatin which it does business, it is possible that Company’s effective income tax rate, the cost of the Company’s e-commerce business, and the growth of its e-commerce business could be materially adversely effectedaffected by other new laws or regulations governing the Internet and e-commerce. This potential negative impact on the Company’s e-commerce business could have a material adverse effect on the Company’s overall business, results of operations and financial condition.

In January 2025, the Company announced the relocation of its eastEast coastCoast distribution facility currently located in Robbinsville, NJ (the “Robbinsville Facility”) to a warehouse and distribution space in Hagerstown, Maryland (the “Hagerstown Facility”). The Hagerstown Facility is a new built to suit distribution center and the Company estimates it will require an investment of capital expenditures of approximately $10$9.3 million for equipment and certain leasehold improvements.improvements, of which $2.3 million has been incurred during fiscal 2025. The Company expects to incur one-timeexit costs to close its Robbinsville Facility of up toapproximately $7 million as well as one-time relocationstart-up costs of up toapproximately $7 million. Additionally, the Company’s purchases that are to be delivered this new distribution facility will require the Company to arrange for transportation, primarily by sea, from ports in Asia and Europe to a new port in the United States. The relocation subjects the Company to certain risks such as delays in construction, increase in exit and relocation costs, and transportation risks. Failure to successfully navigate these risks could have a material adverse effect on the Company’s business and results of operations.

The Company employs information technology systems and operates websites which allow for the secure storage and transmission of proprietary or confidential information regarding the Company’s customers, employees and others, including credit card information and personal identification information. The Company has made significant efforts to secure its computer network to mitigate the risk of possible cyber-attacks, including, but not limited to, data breaches, and is continuously working to upgrade its existing information technology systems and provide employee awareness training around phishing, malware, and other cyber risks toin ensurean that the Company is protected,effort to the greatest extent possible,protect against cybercybersecurity risksthreats and security breaches. Despite ourthese continuous efforts to ensure the security of the Company’s computer networks,efforts, any future cyber incidents could compromise ourthe Company’s information technology systems, whichdisrupt couldoperations, impactresult operationsin the loss, theft or misuse of confidential or personal information, and confidentialadversely informationaffect couldthe beCompany’s misappropriated.ability to process transactions and fulfill orders. Additionally, as Artificial Intelligence ("AI") continues to evolve, cyber-attackers could also use AI to develop malicious code and sophisticated phishing attempts. Although we believe that we have robust information security procedures, controls and other safeguards in place, as cyber threats continue to evolve, we may be required to expend additional resources to continue to enhance our information security measures and/or to investigate and remediate information security vulnerabilities. Cybersecurity incidents may also arise from vulnerabilities in third-party service providers, including cloud service providers, payment processors, logistics providers and other vendors upon which the Company relies. Any cybersecurity incidents could lead to negative publicity, loss of sales and profits or cause the Company to incur significant costs to reimburse third- parties for damages, which could adversely impact profits.

The Company designs, sources and sells branded kitchenware, tableware and other home solution products used in the home. The Company’s product categories include two categories of products used to prepare, serve and consume foods, Kitchenware (kitchen tools, cutlery, kitchen scales, thermometers, cutting boards, shears, cookware, pantryware, spice racks and bakeware) and Tableware (dinnerware, stemware, flatware and giftware); and one category, Home Solutions, which comprises other products used in the home (thermal beverageware, bath scales, weather and outdoor household products, food storage, neoprene travel products and home décor).

The Company markets several product lines within each of its product categories and under most of the Company’s brands, primarily targeting moderate price points through virtually every major level of trade. The Company believes it possesses certain competitive advantages based on its brands, its emphasis on innovation and new product development, and its sourcing capabilities. The Company owns or licenses a number of leading brands in its industry, including Farberware®, KitchenAid®, Mikasa®, Taylor®, Pfaltzgraff® , BUILTDolly NYParton®, S'well®, Sabatier®, Kamenstein®, and Fred® & Friends, KitchenCraft® , Rabbit®, and Kamenstein®.Friends. Historically, the Company’s sales growth has come from expanding product offerings within its product categories, by developing existing brands, acquiring new brands (including complementary brands in markets outside the United States), and establishing new product categories. Key factors in the Company’s growth strategy have been the selective use and management of the Company’s brands and the Company’s ability to provide a stream of new products and designs. A significant element of this strategy is the Company’s in-house design and development teams that create new products, packaging and merchandising concepts.

The Company’s business and working capital needs are seasonal, with a majority of sales occurring in the third and fourth quarters. In 2024,2025, 20232024 and 2022,2023, net sales for the third and fourth quarters accounted for 58%, 57%58% and 54%57% of total annual net sales, respectively. In anticipation of the pre-holiday shipping season, inventory levels typically increase primarily in the June through October time period.

InDuring 2022,2025, the Company’s internationalInternational segment incurred $0.4$0.3 million of restructuring expensesexpense related to severance associated with the reorganization of the International segment’ssegment's workforce. The reorganization was theundertaken resultin ofconnection thewith Company’sProject efforts to realign the managementConcord and operatingprimarily affected the structure of the EuropeanInternational businesssegment's inmerchandising responseand tosales changing market conditions.workforce.

In January 2025, the Company announced the relocation of the Company’s eastEast coastCoast distribution facilityoperations currently located in Robbinsville, NJ (the “Robbinsville Facility”) to a warehouse and distribution space in Hagerstown, Maryland (the “Hagerstown Facility”). In connection with the relocation, the Company will exit the Robbinsville Facility. The Company expects to incur one-time exit costs upof toapproximately $7.0 million for employee severance, certain employee relocation costs, and remaining lease costs for the Robbinsville Facility, which costs are expected to be incurred in 2025 and 2026.

The Hagerstown Facility will require capital expenditures for equipment and certain leasehold improvements of approximately $10.0$9.3 million.million, One-timeof relocationwhich $7.0 million remains to be purchased in 2026. Start-up costs are estimated to be up toapproximately $7.0 million, which includes recruitment, relocation of inventory, set up costs and lease expenses prior to the Hagerstown Facility being fully operational. These one-time costs are expected to be incurred in 2026. The Company expects that the Hagerstown Facility will be fully operational by the secondthird quarter of 2026. Additionally, in connection with the relocation to the Hagerstown Facility, the Company will receive tax abatement and incentives over the term of the Lease from the State of Maryland and Washington County, Maryland totaling approximately $13$13.1 million. These incentives include real property tax abatement, employee state withholding tax credit, conditional grants and income tax credits.

In December 2024,2023, the Company adoptedFinancial Accounting Standards UpdateBoard (“FASB”) issued Accounting Standards Updated No. (“ASU”) 2023-07,2023-09, SegmentIncome ReportingTaxes (Topic 280740): Improvements to ReportableIncome SegmentTax Disclosures:Disclosures. whichThe enhancesamendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to the disclosuresrate required for operating segments in the Company’s annualreconciliation and interimincome consolidatedtaxes financialpaid statements.information. The Company adopted this guidanceASU on a retrospective basis andeffective theJanuary adoption1, did not have a material impact on the Company’s consolidated financial statements.2025. Refer to NOTE 1211 — BUSINESSINCOME SEGMENTSTAXES for the inclusion of new disclosures required.

Net sales for the U.S. segment’s Kitchenware product categorysegment in 20242025 were $384.3$591.2 million, a decrease of $2.4$36.0 million, or 0.6%,5.7%, compared to net sales of $386.7$627.2 million in 2023.2024. TheFor the year ended December 31, 2025, net sales decreasewere inunfavorably the U.S. segment’s Kitchenware product category was drivenimpacted by lower sales forvolume kitchenas toolsprice andincreases barwaresoftened products.consumer The decrease wasdemand, partially offset by higher salesselling prices, reflecting the price increases for cutlerythe andCompany’s board,U.S. andcustomers bakewarethat productsbecame driveneffective by new warehouse programs in 2024 andduring the launchthird quarter of new product lines.2025.

Net sales for the U.S. segment’s HomeKitchenware Solutions productsproduct category in 20242025 were $110.1$374.9 million, ana increasedecrease of $2.0$9.4 million, or 1.9%,2.4%, compared to net sales of $108.1$384.3 million in 2023.2024. The increasenet sales decrease in the U.S. segment’s Kitchenware product category was driven by lower sales for cutlery and board, bakeware products, barware products and kitchen tools. The decrease was partially offset by higher sales for Homekitchen Décormeasurement products driven by a new warehouse club program in 2024 and sales of a new licensed product brand, partially offset by lower hydration product sales and Taylor branded bath measurement products.2025.

Net sales for the International segment in 20242025 were $55.8$56.7 million, an increase of $2.2$0.9 million, or 4.1%,1.6%, compared to net sales of $53.6$55.8 million for 2023.2024. In constant currency, a non-GAAP financial measure, which excludes the impact of foreign exchange fluctuations and was determined by applying 20242025 average exchange rates to 20232024 local currency amounts, net sales increaseddecreased approximately 1.6%.1.7%. The increase in net sales was driven by favorable foreign currency translation effects.The decrease in constant currency was driven by lower sales in the U.K., partially offset by higher sales with global trading business in Asia.the Asia Pacific region.

Gross margin for the InternationalU.S. segment was $20.4$220.8 million, or 36.6%,37.3%, for 2024,2025, compared to $18.1$240.3 million, or 33.8%,38.3%, for 2023.2024. The increasedecrease in gross margin percentage was primarily attributable to higher tariffs and product costs, which more than offset the benefit of higher selling prices. The decrease in gross margin dollars was driven by lower inventorysales reserves in the current period.volume.

Distribution expenses as a percentage of net sales for the U.S. segment were approximately 10.0% in 2025 and 9.6% in 2024 and 8.8% in 2023.2024. Distribution expenses in 20242025 and 20232024 included $1.0$0.3 million and $0.6$1.0 million, respectively, for redesign costs related to the Company’s U.S. warehouses. As a percentage of sales shipped from the Company’s warehouses, excluding warehouse redesign expenses, distribution expenses were 9.7%9.6% and 9.4%9.7% for 20242025 and 2023.2024. The increasedecrease in thedistribution expenses as a percentage of sales was aprimarily resultattributable ofto higherlower depreciation expense due to changes in asset retirement obligation estimates andin lessthe prior year, improved labor management efficiencies resultingand in an increase ofdecreased employee expenses, partiallynet offsetof byhigher lowersoftware storagecosts, expenses.due to the launch of a new warehouse management system at the Company’s West Coast distribution center in September 2024.

Distribution expenses as a percentage of net sales for the International segment were approximately 26.3% in 2025 and 24.7% in 2024 and 25.0% in 2023,2024, respectively. As a percentage of sales shipped from the Company’s international warehouses, distribution expenses were 22.1%23.1% and 22.3%22.1% for 20242025 and 2023,2024, respectively. The decreaseincrease in thedistribution expenseexpenses as a percentage of sales was primarily attributedattributable to favorablehigher freightwarehouse rates,expenses related to the expanded distribution of the Company’s products within the Asia Pacific region, partially offset by lowera shipment volumedecrease in U.K.freight-out resultingexpenses indue anto unfavorablecustomer impact of fixed warehouse expenses.mix.

Selling, general and administrative (“SG&A”) expenses for 20242025 were $159.8$142.4 million, ana increasedecrease of $7.2$17.4 million, or 4.7%,10.9%, as compared to $152.6$159.8 million for 2023.2024.

SG&A expenses for 20242025 for the U.S. segment were $123.0$117.5 million, ana increasedecrease of $5.6$5.5 million, or 4.8%,4.5%, compared to $117.4$123.0 million for 2023.2024. As a percentage of net sales, SG&A expenses were 19.6%19.9% for 2024,2025, compared to 18.5%19.6% for 2023.2024. The increasedecrease in the expenses was attributable to higherlower employee expenses, including incentive compensation, partially offset by an increase in amortization expense related to an indefinite trade name, which was reclassified to a definite lived trade name in 2024,the fourth quarter 2024. The increase in selling, general and administrative expenses relatedas a percentage of net sales, was attributable to the start-upimpact of thefixed Company’scosts manufacturingon operationslower innet Mexico, legal expenses, and inflationary increases across several expense categories. This was partially offset by a decrease in the provision for doubtful accounts in the current period.sales.

SG&A expenses for 20242025 for the International segment were $17.2$13.9 million, ana increasedecrease of $1.5$3.3 million, or 9.6%,19.2%, compared to $15.7$17.2 million for 2023.2024. As a percentage of net sales, SG&A expenses were 30.8%24.5% for 2024,2025, compared to 29.3%30.8% for 2023.2024. The increasedecrease in the expenses was primarily attributable to higherforeign currency exchange gains, lower employee expenses, decreases in advertising expenses and commissions, and the prior year expense included penalties related to tax filings incurred in the current period, and higher foreign currency exchange losses.filings.

Unallocated corporate expenses for 20242025 were $19.6$11.0 million, compared to $19.5$19.6 million for 2023.2024. The increasedecrease in expenses was driven by the recognition of a net legal settlement gain of $6.4 million in the current period, lower insuranceincentive compensation, partially offset by higher professional fees and legal expenses.

Interest expense for 20242025 was $22.2$20.0 million, compared to $21.7$22.2 million for 2023.2024. The increasedecrease in expense was a result of higherlower interest rates onaverage outstanding borrowings in the current period, partially offset byand lower averageinterest rates on outstanding borrowings.

Mark to market loss on interest rate derivatives was $0.5$0.8 million and $0.5 million, respectively, for both the year ended December 31, 2024,2025, and December 31, 2023.2024. The mark to market amount represents the change in the fair value on the Company’s interest rate derivatives that have not been designated as hedging instruments.instruments for accounting purposes. These derivatives were entered into for purposes of locking-in a fixed interest rate on the Company's variable interest rate debt. As of December 31, 2024,2025, the intent of the Company is to hold these derivative contracts until their maturity.

The income tax benefit was $3.3 million in 2025 and the income tax provision was $3.3 million in 2024 and $6.2 million in 2023.2024. The Company’s effective tax rate for 20242025 was (34.2)%,10.9%, compared to 59.4%its effective tax rate of (34.2)% for 2023.2024. The negative rate for 2024 reflects tax expense on pretax financial reporting loss. The effective tax rate in 2025 differs from the federal statutory rate primarily due to UK foreign losses for which no tax benefit is recognized as such amounts are fully offset with a valuation allowance, and the provision of valuation allowances against current and cumulative losses in Asia, Australia, and New Zealand. The effective tax rate in 2024 differs from the federal statutory rate primarily due to state and local tax expense, nondeductible expenses and losses, and UK foreign losses for which no tax benefit is recognized as such amounts are fully offset with a valuation allowance, offset by a reduction in the Company’s accrual for uncertain tax positions and the release of the valuation allowance on foreign losses in the Netherlands.

Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses the Company’s audited consolidated financial statements which have been prepared in accordance with GAAP and with the instructions to Form 10-K and Article 10 of Regulation S-X. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-goingongoing basis, management evaluates its estimates and judgments based on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The Company evaluates these estimates including those related to revenue recognition, allowances for doubtful accounts, reserves for sales returns and allowances and customer chargebacks, inventory mark-down provisions, estimates for unpaid healthcare claims, impairment of goodwill, tangible and intangible assets, stock compensation expense, accruals related to the Company’s tax positions and tax valuation allowances. Actual results may differ from these estimates using different assumptions and under different conditions and changes in these estimates are recorded when known. The Company’s significant accounting policies are more fully described in NOTE 1 — SIGNIFICANT ACCOUNTING POLICIES in the Notes to the consolidated financial statements included in Item 15. The Company believes that the following discussion addresses its most critical accounting policies, which are those that are most important to the portrayal of the Company’s consolidated financial condition and results of operations and require management’s most difficult, subjective and complex judgments.

Goodwill and intangible assets deemed to have indefinite lives areis not amortized but, instead, areis subject to an annual impairment assessment on October 1. Additionally, if events or conditions were to indicate the carrying value of a reporting unit may not be recoverable, the Company would evaluate goodwill and other intangible assets for impairment at that time.

As it relates to the goodwill assessment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment testing described in the FASB’s ASC Topic 350, Intangibles – Goodwill and Other. If, after assessing qualitative factors, the Company determines that it is more likely than not that the fair value of a reporting unit exceedexceeds its carrying amount, then no further testing is performed for that reporting unit. However, if based on the Company’s qualitative assessment it concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, or if the Company elects to bypass the qualitative assessment, the Company will proceed with performing the quantitative impairment test.

The Company reviews goodwill and other intangibles that have indefinite lives for impairment annually as of October 1st or when events or changes in circumstances indicate the carrying value of these assets might exceed their current fair values. For goodwill, impairment testing is based upon the best information available using a combination of the discounted cash flow method, a form of the income approach, and the guideline public company method, a form of the market approach.

In addition to the other information set forth in this Quarterly Report on Form 10-Q, readers should carefully consider the factors discussed in Part I, Item 1A—Risk Factors in the 2025 Annual Report on Form 10-K, and in the Company’s other filings with the SEC, which could materially affect the Company’s business, financial condition, cash flows or future results. There have been no material changes from the risk factors previously disclosed in Part I, Item 1A—Risk Factors in the 2025 Annual Report on Form 10-K.

•The impact of tariffs and trade policies, particularly with respect to ChinaChina, including the risk of frequent changes, legal challenges, or reinstatement in modified form;

The Company sources almost all of its productproducts from third-party manufacturers outside the U.S., primarily in China. This geographic concentration in suppliers exposes the Company to risks associated with doing business globally, including risks relating to changes in U.S. tariff and trade policies. New or increased tariffs, quotas, embargoes, or other trade barriers could adversely impact our supply chain and cost structure. In 2025, the Company implemented several actions to mitigate the impact of the tariffs imposed by the U.S. administration. For example, the Company negotiated price increases to its U.S. customers which went into effect in the third quarter of 2025. The Company’s tariff mitigation strategy was intended to maintain the Company’s gross margin dollars and therefore, may result in a decline in gross margin percentage.

On February 20, 2026, the U.S. Supreme Court held that the U.S. administration’s imposition of tariffs pursuant to the International Emergency Economic Powers Act (“IEEPA”) was unlawful, striking down the 10% global baseline tariff, as well as the higher tariffs imposed on certain U.S. trading partners. The U.S. Supreme Court’s ruling did not affect all of the recently imposed tariffs, including those imposed following trade remedy investigations by the Department of Commerce or the U.S. Trade Representative. Nor did it prohibit the imposition of future tariffs through alternative trade authorities available to the U.S. administration. On February 20, 2026, shortly after the announced U.S. Supreme Court decision, the U.S. administration announced that it would be imposing a new 10% global tariff for a period of 150 days pursuant to a balance-of-payments provision in Section 122 of the Trade Act of 1974, to become effective February 24, 2026. The U.S. administration furtheralso announced that it would begininitiated additional trade remedy investigations into unidentified trading partners pursuant to Section 301 of the Trade Act of 19741974, one affecting 60 trading partners with respect to the prohibition of forced labor and another affecting 16 trading partners with respect to excess manufacturing capacity. The administration further announced that it would be initiating additional investigations with respect to certain unidentified product sectors pursuant to Section 232 of the Trade Expansion Act of 1962. The U.S. Government has stated publicly that companies will need to litigate to obtain refunds, which could take years. While guidance and processes relating to refunds continue to develop, it remains challenging to predict if, and when, any refunds will, in fact, be obtained and whether refunds would be paid in cash or credits against future duties or tariffs. As ofIn April 20, 2026, the CBP has launched Phase One of the Consolidated Administration and Processing of Entries ("CAPE") program to process refunds.refunds and begin making refund payments to importers of record in May 2026. As of June 29, 2026, the CBP has launched Phase Two of the IEEPA refund claims process. The Company has submitted all refunds claims under Phase One and continues to actively engage with its custom brokers and outside legal counsel for refunds that fall under Phase 2. The total refund claims related to the IEEPA tariff totaled $41.7 million.

The Company cannot predict what additional changes to trade policy will be made by the U.S. administration or Congress, including whether existing tariff policies will be maintained or modified, what products may be subject to such policies, or whether the entry into new bilateral or multilateral trade agreements will occur, nor can weit predict the effects that any such changes would have on ourthe Company's business, capital expenditures, and results of operations. The Company is actively monitoring the rapidly evolving tariff and global trade policies that become effective, as well as potential retaliatory actions by other countries.

Escalating geopolitical conflicts in the Middle East, including shipping disruptions in the Strait of Hormuz, have leadled to increased volatility on global energy prices. Sustained increases in energy costs could materially increase the Company’s product and transportation costs, including through higher input costs and increased fuel prices, which typically lead to fuel surcharges and higher freight rates from third-party logistics providers. This could increase the Company’s distribution and inbound freight costs. The duration of the conflict and the potential for further escalation, including military actions, sanctions, or disruptions to key trade routes, could adversely affect the global macroeconomic environment, and in turn, negatively impact consumer spending and demand for the Company’s products. The Company continues to monitor these developments,developments; however the extent and duration of their impact remain uncertain. If energy prices remain elevated or if macroeconomic conditions deteriorate, the Company’s results of operations and financial condition could be materially adversely affected.

•On March 26, 20262026, the Company announced a second reorganization of its international workforce in connection with Project Concord. The restructuring expenses related to severance associated with the reorganization of $0.2 million was recorded in the threesix months ended MarchJune 31,30, 2026.

THREE MONTHS ENDED MARCHJUNE 31,30, 2026 COMPARED TO THE THREE MONTHS ENDED

MARCHJUNE 31,30, 2025

Consolidated net sales for the three months ended MarchJune 31,30, 2026 were $143.5$141.6 million, representing an increase of $3.4$9.7 million, or 2.4%,7.4%, as compared to net sales of $140.1$131.9 million for the corresponding period in 2025. In constant currency, a non-GAAP financial measure, which excludes the impact of foreign exchange fluctuations and was determined by applying 2026 average rates to 2025 local currency amounts, consolidated net sales increased by $2.5$9.5 million, or 1.8%,7.2%, as compared to consolidated net sales in the corresponding period in 2025.

Net sales for the U.S. segment for the three months ended MarchJune 31,30, 2026 were $130.7$128.2 million, an increase of $2.2$8.9 million, or 1.7%,7.5%, as compared to net sales of $128.5$119.3 million for the corresponding period in 2025. For the three months ended MarchJune 31,30, 2026, net sales were favorably impacted by higher selling prices, reflecting the implementation of price increases for the Company’s U.S. customers that went into effect during the third quarter of 2025.

Net sales for the U.S. segment’s Home SolutionsKitchenware product category were $26.3$85.4 million for the three months ended MarchJune 31,30, 2026, an increase of $4.9$2.9 million, or 22.9%,3.5%, as compared to $21.4$82.5 million for the corresponding period in 2025. The increase was primarilydriven attributableby toan higherincrease in sales for homekitchen décortools productsand kitchen measurement products. These increases were partially offset by a decrease in thesales dollarfor channelcutlery and warehouseboards cluband programs.bakeware products.

Net sales for the InternationalU.S. segmentsegment’s Tableware product category were $12.8$23.6 million for the three months ended MarchJune 31,30, 2026, an increase of $1.2$2.3 million, or 10.3%,10.8%, as compared to net sales of $11.6$21.3 million for the corresponding period in 2025. In constant currency, a non-GAAP financial measure, which excludes the impact of foreign exchange fluctuations, net sales increased by $0.3 million, or 2.5%, as compared to consolidated net sales in the corresponding period in 2025. The increase in net sales was drivenprimarily byattributable to higher sales in the Asiawarehouse Pacificclub region.channel for dinnerware.

Gross margin for the three months ended MarchJune 31,30, 2026 was $54.2$93.2 million, or 37.7%,65.9%, as compared to $50.6$50.8 million, or 36.1%,38.6%, for the corresponding period in 2025.

Gross margin for the U.S. segment was $49.5$87.5 million, or 37.9%,68.3%, for the three months ended MarchJune 31,30, 2026, as compared to $46.5$46.7 million, or 36.2%,39.1%, for the corresponding period in 2025. The improvementincrease was driven by a benefit in the grosscurrent marginperiod percentagefrom wastariff attributablerefunds of $40.1 million related to favorableprior product mix,periods, higher selling prices, partially offset by higherproduct tariffs.mix.

Gross margin for the International segment was $4.7$5.7 million, or 36.7%,42.5%, for the three months ended MarchJune 31,30, 2026, as compared to $4.1 million, or 35.3%,32.5%, for the corresponding period in 2025. The increase in gross margin percentage was driven by customer mix and producthigher mix.selling prices for products sold in the Asia-Pacific region.

Distribution expenses for the three months ended MarchJune 31,30, 2026 were $17.6$20.1 million, as compared to $18.1$17.3 million for the corresponding period in 2025. Distribution expenses as a percentage of net sales were 12.3%14.2% for the three months ended MarchJune 31,30, 2026, as compared to 12.9%13.1% for the three months ended MarchJune 31,30, 2025.

Distribution expenses as a percentage of net sales for the U.S. segment were 10.9%12.8% and 11.5%11.4% for the three months ended MarchJune 31,30, 2026 and 2025, respectively. Distribution expense during the three months ended MarchJune 31,30, 2026 and 2025 included $0.2$2.2 million and $0.1 million for relocation and redesign costs related to the Company’s warehouses. As a percentage of sales shipped from the Company’s U.S. warehouses, excluding non-recurring expenses, distribution expenses were 10.9%11.9% and 11.9%11.0% for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The decreaseincrease in expenses as a percentage of sales was attributable to an increase in employee expenses as a result of reduced labor management efficiencies, higher insurance expenses and facility supply expenses. The increase was partially offset by higher sales resulting in a favorable impact ofon fixed expenses, lower volume due to sales mix resulting in a decrease of employee expenses, and lower facilityfreight-out supplyexpenses expenses.due Theto decreasecustomer was partially offset by higher freight rates.mix.

Distribution expenses as a percentage of net sales for the International segment were 26.4%27.3% for the three months ended MarchJune 31,30, 2026, compared to 28.3%29.8% for the corresponding period in 2025. As a percentage of sales shipped from the Company’s international warehouses distribution expenses were 23.2%24.2% and 25.0%26.8% for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The decrease in expenses as a percentage of sales was attributable to higher sales resulting in a favorable impact of fixed expenses and a decrease in variable warehouse expenses at third-party operated distribution facilities.expenses.

Selling, general and administrative expenses for the three months ended MarchJune 31,30, 2026 were $36.8$39.5 million, an increase of $5.3$2.0 million, or 16.8%,5.3%, as compared to $31.5$37.5 million for the corresponding period in 2025.

Selling, general and administrative expenses for the U.S. segment were $28.2$31.2 million for the three months ended MarchJune 31,30, 2026, as compared to $30.0$29.5 million for the corresponding period in 2025. As a percentage of net sales, selling, general and administrative expenses were 21.6%24.3% and 23.3%24.7% for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The decreaseincrease in selling, general and administrative expenses was attributable to lowerhigher employeeincentive expenses,compensation, partially offset by a decrease in the provision for doubtful accounts in the current period, and lower advertising expenses. This was partially offset by an increase in insurance expenses.period. The decrease in selling, general and administrative expenses as a percentage of net sales, was also attributable to the impact of fixed costs on higher sales volume.

Selling, general and administrative expenses for the International segment were $3.7$3.3 million for both the three months ended MarchJune 31,30, 20262026, andas compared to $3.7 million for the corresponding period in 2025. As a percentage of net sales, selling, general and administrative expenses were 28.9%24.6% and 31.9%29.4% for the three months ended MarchJune 31,30, 2026 and 2025, respectively. Selling,The decrease in selling, general and administrative expenses remainedwas flatattributable year-over-year,to as decreases inlower employee expenses and commissionsales expenses were fully offset by unfavorable foreign currency exchange impacts.commissions. The decrease in selling, general and administrative expenses as a percentage of net sales, was attributable to the impact of fixed costs on higher sales volume.

Unallocated corporate expenseexpenses for the three months ended MarchJune 31,30, 2026 was $4.9$5.1 million, as compared to unallocated corporate incomeexpenses of $2.2$4.3 million for the corresponding period in 2025. The decreaseincrease compared to the prior period was dueattributable to the recognition of a net legal settlement gain of $6.4 million in the prior period, partially offset by an increase in professional fees and legal expensesexpenses, and higher incentive compensation in the current period.

Restructuring expenses for the three months ended MarchJune 31,30, 2026 were $2.0 million, which consist of employee severance expenses related to the east coast distribution facility relocation of $1.2 million, sterlingand flatwarerestructuring expenses with the closure of certain manufacturing operations restructuring expense of $0.7 million, and Project Concord severance expense of $0.1$0.8 million. See NOTE 1 — BASIS OF PRESENTATION AND SUMMARY OF ACCOUNTING POLICIES to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information.

Interest expense was $4.5$4.1 million and $4.9$5.1 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The decrease in expense was a result of lower average outstanding borrowings in the current period, partiallyand offset by higherlower interest rates on outstanding borrowings.

Mark to market gain on interest rate derivatives was $0.3$0.2 million for the three months ended MarchJune 31,30, 2026, as compared to mark to market loss of $0.5$0.2 million for the three months ended MarchJune 31,30, 2025. The gain (loss) recognized for the three months ended MarchJune 31,30, 2026 and 2025, respectively, was attributable to the change in the fair value due to the change in the projected interest rate environment. The mark to market amount represents the change in fair value on the Company’s interest rate derivatives that have not been designated as hedging instruments. These derivatives were entered into for purposes of locking-in a fixed interest rate on a portion of the Company’s variable interest rate debt. As of MarchJune 31,30, 2026, the intent of the Company is to hold these derivative contracts until their maturity.

Income tax provision of $8.1 million and income tax benefit of $1.7 million and $0.1$2.8 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, represent taxes on both U.S. and foreign earnings at a combined effective income tax rate of 26.0%29.2% and 3.3%,benefit rate of 6.5%, respectively. The effective tax rate for the three months ended MarchJune 31,30, 2026 differs from the federal statutory income tax rate of 21.0% primarily due to state and local tax expense, the impact of non-deductible expenses, and foreign losses for which no tax benefit is recognized as such amounts are fully offset with a valuation allowance, partially offset by a benefit for federal credits.expenses. The effective tax rate for the three months ended MarchJune 31,30, 2025 differs from the federal statutory income tax rate of 21.0% primarily due to foreigna lossespartial forvaluation whichallowance noon U.S. deferred tax benefitassets isthat recognizedare not more likely than not to be realized as such amounts are fully offset with a valuationresult allowance.of the goodwill impairment in the second quarter.