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

The Company's financial position, results of operationsoperations, and cash flows are subject to various risks, many of which are not exclusively within the Company's control, which may cause actual performance to differ materially from historical or projected future performance. Investors should carefully consider information in this Annual Report on Form 10-K in light of the risk factors described below.

Macroeconomic conditions, including inflation andinflation, elevated interest rates, and tariffs, as well as prior supply chain, labor and logistics constraints, have had, and may continue to have, a negative impact on our ability to convert backlog into revenue (the timing of sales) which could, and has, impacted our financial condition, cash flowsflows, and results of operations. For instance, the delay in the realization of price increases and provisional pricing strategies (due to longer lead times of orders in our backlog), together with prior supply chain, labor and logistics constraints, previously impacted our ability to convert backlog into revenue, impacting the timings of those sales. In addition, prior shipping constraints resulted in delays in shipments in certain regions. Continuing or worsening inflationmacroeconomic conditions may have a material adverse impact on our financial condition, results of operationsoperations, and/or cash flows.

Geopolitical events, including the ongoing conflicts in Ukraine and in the Middle East, have hadled to and may continue to lead to logistic constraints, higher logistic costs, and significant volatility in raw material and component costs in Europe, exacerbating the inflation and tariff situation, which may have a material adverse impact on our financial condition, results of operationsoperations, and/or cash flows.

We sell most of our products in highly competitive end markets. We compete in each of those end markets based on product design, quality of products, quality and responsiveness of product support services, product performance, cost of ownership, maintenance costscosts, and price. Some of our competitors may have greater financial, marketing, manufacturingmanufacturing, and distribution resources than we do. These competitors may, among others:

devote greater resources to the development, promotionpromotion, and sale of their products;

We cannot be certain that our products and services will continue to compete successfully with those of our competitors or that we will be able to retain our customer base or improve or maintain our profit margins on sales to our customers, any of which could materially and adversely affect our financial condition, results of operationsoperations, and cash flows.

Historically, sales of products that we manufacture and sell have been subject to cyclical variations caused by changes in general economic conditions and other factors. In particular, demand for our products is cyclical and is impacted by the strength of the economy, generally, the availability of financing and other factors, including crude oil prices, that may have an effect on the level of construction activity on an international, national or regional basis, each of which have been and/or continue to be negatively impacted by global supply chain constraints, labor constraints, logistic constraints, cost pressures, inflation, elevated interest ratesrates, and geopolitical events. Additionally, the level of construction activity and customer demand has been and may continue to be impacted by pandemics or global health crises.

During periods of expansion in construction activity, we generally have benefited from increased demand for our products. Conversely, during recessionary periods, we have been adversely affected by reduced demand for our products, and challenging conditions can continue well beyond the end of such periods. Furthermore, any economic recession may impact leveraged companies, like us, more than competing companies with less leverage and may have a material adverse effect on our financial condition, results of operationsoperations, and cash flows.

Demand for our products also depends in part on federal, state, locallocal, and foreign governmental spending and appropriations, including infrastructure, securitysecurity, and defense outlays. Reductions in governmental spending can reduce demand for our products, which in turn, can negatively affect our performance. Our sales depend, in part, upon our customers’ replacement or repair cycles. Adverse economic conditions, including global supply chain constraints, labor constraints, logistic constraints, and cost pressures, pandemics or public health crises, inflation, tariffs, elevated interest ratesrates, and geopolitical events, have caused and may continue to cause customers to forego or postpone new purchases in favor of repairing existing machinery.

If we are unable to sufficiently adjust to market conditions, among other potential adverse effects on our financial condition, results of operationsoperations, and cash flows, we could fail to deliver on expected results, incur high fixed costs and/or fail to benefit from any increased customer demand, resulting in loss of market share.

We use large amounts of steel, among other items, in the manufacture of our products. Occasionally, market prices of some of our key raw materials increase significantly, including as a result of tariffs, other trade barriers, macroeconomic conditionsconditions, or geopolitical events, resulting in increases in the cost of our products or shortages. If in the future we are unable to reduce product costs in other areas, or pass raw material price increases on to our customers, our margins could be adversely affected. In addition, because we maintain limited raw material and component inventories, even brief unanticipated delays in delivery by suppliers - including those due to supply chain constraints, labor constraints, logistic constraints, geopolitical events, supplier capacity constraints, labor disputes, impaired financial condition of suppliers, pandemics, global health crises, other infectious diseases, weather emergenciesemergencies, or other natural disasters - may impair our ability to satisfy our customer demand, as well as delay our ability to produce and ship certain of our products, and have had an adverse effect on, and may continue to adversely affectaffect, our financial performance.

inadequate infrastructure for our operations (i.e., lack of adequate power, water, transportationtransportation, and raw materials);

burdens of complying with a wide variety of labor practices and foreign laws, including those relating to export and import duties, environmental policiespolicies, and privacy issues;

inability to utilize net operating losses incurred by our foreign operations against future income in the same jurisdiction; and economies that are emerging or developing, that may be subject to greater currency volatility, negative growth, or recession, high inflation, limited availability of foreign exchangeexchange, and other risks.

Disruptions in operations, including supply chain constraints, technical problems or other interruptions, such as floods, fire, natural disasters, pandemics or other public health crises, have adversely effected, and in the future may adversely affect the manufacturing or service capacity of our facilities and delayhave delayed, and in the future may delay, our ability to produce, ship or service certain of our products. Such interruptions have caused, and in the future could cause, delays in production or service, and causehave caused, and in the future could cause, us to incur additional expenses such as charges for expedited deliveries for products that are delayed. Additionally, our customers may have the ability to cancel purchase orders in the event of any delays in production or service and may decrease future orders if delays are persistent. To the extent that such disruptions do not result from damage to our physical property, these disruptions may not be covered by our business interruption insurance. Any such disruptions may adversely affect our business, operationsoperations, and financial results.

Our success depends to a large extent upon the continued services of our executive officers, senior management personnel, managersmanagers, and other skilled personnel and our ability to recruit and retain skilled personnel to maintain and expand our operations. We could be affected by the loss of any of our executive officers who are responsible for formulating and implementing our business plan and strategy. In addition, we need to recruit and retain additional management personnel and other skilled employees. However, competition is high for skilled technical personnel among companies that rely on engineering and technology. The loss of qualified employees or an inability to attract, retainretain, and motivate additional skilled employees required for the operation and expansion of our business could hinder our ability to conduct design, engineeringengineering, and manufacturing activities successfully and develop marketable products, as well as successfully expand our aftermarket service business. We may not be able to attract the skilled personnel we require or retain those whom we have trained at our own cost. If we are not able to do so, our business and our ability to continue to grow could be negatively affected and we could face additional competition from those employees who leave and work for our competitors.

hire, retainretain, and expand our pool of qualified engineering and technical personnel;

We cannot be certain that we will develop the capabilities required by our customers in the future. The emergence of new technologies, industry standardsstandards, or customer requirements may render our equipment, inventoryinventory, or processes obsolete or uncompetitive. We may have to acquire new technologies, skillsskills, and equipment to remain competitive. The acquisition and implementation of new technologies and equipment may require us to incur significant expense and capital investment, which could reduce our margins and affect our operating results. When we establish new facilities, we may not be able to maintain or develop our engineering, technological, manufacturingmanufacturing, and service expertise due to a lack of trained personnel, effective training of new staffstaff, or technical difficulties with machinery. Failure to anticipate and adapt to customers’ changing technological needs and requirements or to hire and retain a sufficient number of engineers and service technicians and maintain engineering, technological, manufacturingmanufacturing, and service expertise may have a material adverse effect on our business.

In the ordinary course of business, we collect and store sensitive data and information, including our proprietary and regulated business information and that of our customers, supplierssuppliers, and business partners, as well as personally identifiable information about our employees. We depend on our information systems to successfully manage our business. We have taken steps to maintain adequate data security by implementing cyber security technologies, internal controls, and network and data center resiliency and recovery processes. However, an inability to successfully manage these systems, including matters related to system and data security, privacy, reliability, compliance, performanceperformance, and access, as well as an inability of these systems to fulfill their intended purpose within our business, could have an adverse effect on our business.

Despite our efforts, our information systems, like those of other companies, are susceptible to damage or interruption due to natural disasters, power loss, telecommunications failures, viruses, breaches of security, system upgradesupgrades, or new system implementations. Furthermore, our security measures may not detect or prevent all security threats, whether from intentional or inadvertent breaches by our employees or attacks designed to gain unauthorized access to our systems, networks and data, such as denial-of-service attacks, viruses, malicious software, break-ins, phishing attacks, social engineering, security breachesbreaches, or other attacks and similar disruptions. Any operational failure or breach of security from increasingly sophisticated cyber threats could lead to the loss or disclosure of both our and our customers’ financial, product and other confidential information, result in regulatory actions, legal proceedingsproceedings, and increased insurance costs, and have an adverse effect on our business and reputation.

We depend on various information systems to successfully manage our business, including managing orders, suppliers, accounting controlscontrols, and payroll. The inability to successfully manage the procurement, development, implementationimplementation, or execution of our information systems and back-up systems, including matters related to system security, reliability, performanceperformance, and access, as well as the inability of these systems to fulfill their intended purpose within our business, could have an adverse effect on our business and financial performance. Such disruptions may not be covered by our business interruption insurance.

We have in the past pursued and expect to continue to pursue acquisitions, strategic alliances, joint venturesventures, orand other significant transactions in line with our strategy. In order to pursue this strategy successfully, we must identify attractive acquisitions, strategic alliances, and joint venture opportunities, potentially obtain financing for future acquisitions on satisfactory terms, successfully complete the transaction,transactions, some of which may be large and complex, and manage post-closing issues such as integration of the acquired company or employees. We may not be able to identify or complete appealing acquisition, strategic alliancealliance, or joint venture opportunities given the intense competition for these transactions. Even if we identify and complete suitable transactions, we may not be able to successfully address inherent risks in a timely manner, or at all. These inherent risks include, among other things: failure to achieve all or any projected synergies, performance targets or other anticipated benefits of the acquisition, strategic alliance or joint venture; failure to successfully integrate the purchased operations, technologies, productsproducts, or services and maintain uniform standard controls, policiespolicies, and procedures; incurring substantial unanticipated integration costs; the loss of key employees, including those of an acquired business; diversion of management’s attention from other business concerns; failure to retain the customers of the acquired business; additional debt and/or assumption of known or unknown liabilities; potential dilutive issuances of equity securities; and a write-off of goodwill, customer lists, other intangiblesintangibles, and amortization of expenses. If we fail to successfully integrate an acquisition, we may not realize all or any of the anticipated benefits of the acquisition, and our future results of operations could be adversely affected.

We sell some of our products and provide aftermarket services through both independent third parties such as distributors, agents and channel partners (collectively referred to as distributors), and wholly owned subsidiaries. Each distribution method has risks and costs, and our failure to maintain and grow an effective distribution network may have a material adverse impact on our business.business and financial results.

Using distributors exposes us to many risks, including competitive pressure, concentration risk, credit risk, and compliance risks. Distributors may sell products that compete with our products, and we may need to provide financial and other incentives to focus distributors on the sale of our products. We may rely on one or more key distributors for a product, and the loss of these distributors could negatively impact our sales. Distributors may face financial difficulties, including bankruptcy, which could harm our collection of accounts receivable and our financial results. Violations of the Foreign Corrupt Practices Act or similar laws by distributors or other third-party intermediaries could have a material impact on our business. Failing to manage risks related to our use of distributors may reduce sales, increase expenses, and weaken our competitive position.

Increasing costs such as labor costs, raw material and component costs, logistic costs, unfavorable absorption of overhead costs due to inefficiencies from supply chain constraints, and energy costs, in the countries in which we operate may erode our profit margins and compromise our price competitiveness. Our profitability also depends on our ability to manage and contain our other operating expenses such as the cost of factory supplies, factory space, equipment rental, repairs and maintenancemaintenance, and freight and packaging expenses. In the event we are unable to manage any increase in our labor and other operating expenses in an environment where revenue does not increase proportionately, our financial results would be adversely affected.

As of December 31, 2024,2025, we employed approximately 1,8004,700 people; 1,750 in the Americas segment, 2,500 in the EURAF segment, and 500450 in the MEAP segment. The vast majority of employees are full-time, with approximately 27%26% covered by a national trade union or collective bargaining agreement. Any significant labor relations issues with our various employee unions could have an adverse effect on our operations, reputation, results of operations and financial condition.

Our inability to recover from natural or man-made disasters or public health crises could adversely affect our business.business and financial results.

Our business and financial results may be affected by certain events that we cannot anticipate or that are beyond our control, such as natural or manmade disasters, pandemics or other public health crises, national emergencies, significant labor strikes, work stoppages, the effects of climate change, political unrest, warwar, or terrorist activities that could curtail production at our facilities and cause delayed deliveries and canceled orders. In addition, we purchase raw material and components, information technology and other services from numerous suppliers, and, even if our facilities were not directly affected by such events, we have been and in the future could be affected by interruptions at such suppliers. Such suppliers may be less likely than our own facilities to be able to quickly recover from such events and may be subject to additional risks such as financial problems that limit their ability to conduct their operations. We cannot be assured that we will have insurance to adequately compensate us for any of these events.

A portion of our sales are financed by third-party finance companies on behalf of our customers. The availability of financing from third parties is affected by general economic conditions, the creditworthiness of our customers and the estimated residual value of our equipment. In certain transactions, we provide residual value guarantees and buyback commitments to our customers or to third-party financial institutions. Deterioration in the credit quality of our customers or the overall health of the finance industry could negatively impact our customers’ ability to obtain the resources needed to make purchases of our equipment or their ability to obtain third-party financing. In addition, if the actual value of the equipment for which we have provided a residual value guaranty declines below the amount of our guaranty, we may incur additional costs, which may negatively impact our financial condition, results of operationsoperations, and cash flows.

The agreements governing our debt include covenants that restrict, among other matters, our ability to assume or guarantee additional debt or issue certain preferred shares, pay dividends on or make other distributions in respect of our capital stock or make other restricted payments, make certain investments, sell or transfer certain assets, create liens on certain assets to secure debt, consolidate, merge, sell, or otherwise dispose of all or substantially all of our assets, enter into certain transactions with affiliates and designate our subsidiaries as unrestricted. Certain of our debt facilities require or will require us to maintain specified financial ratios and satisfy certain financial condition tests. Our ability to comply with these covenants may be affected by events beyond our control, including prevailing economic, financial and industry conditions. Adhering to these covenants may also require that we take disadvantageous actions, including reducing spending on marketing, advertising and new product innovation, reducing future financing for working capital, capital expenditures and general corporate purposes, selling assets or dedicating an unsustainable level of cash flows from operations to the payment of principal and interest on our indebtedness. Our leverage could also put us at a disadvantage compared to any competitors that are less leveraged. We cannot be certain that we will meet any future financial tests or that the lenders would waive any such failure to meet those tests. Refer to Note 10,11, “Debt,” to the Consolidated Financial Statements.Statements for additional information regarding our outstanding debt.

If we default under our debt agreements, our lenders could elect, among other potential remedies, to declare all amounts outstanding under our debt agreements to be immediately due and payable and could proceed against any collateral securing the debt, which would adversely affect our results of operations, financial conditioncondition, and cash flows in future periods.

Some of our operations are and will continue to be conducted by subsidiaries in foreign countries. The results of the operations and the financial position of these subsidiaries will be reported in the relevant foreign currencies and then translated into U.S. dollars at the applicable exchange rates for inclusion in our consolidated financial statements, which are stated in U.S. dollars. The exchange rates between foreign currencies and the U.S. dollar have fluctuated significantly in recent years and may continue to fluctuate in the future. Such fluctuations may have a material effect on our results of operations and financial position and may significantly affect the comparability of our results between financial periods.

However, we may not be able to hedge this risk completely or at an acceptable cost, which may adversely affect our results of operations, financial conditioncondition, and cash flows in future periods.

We regularly undergo tax audits in various jurisdictions in which we operate. Although we believe that our tax estimates are reasonable and that we prepare our tax filings in accordance with all applicable tax laws, the final determination with respect to any tax audits, and any related contests thereto, could be materially different from our estimates or from our historical income tax provisions and accruals. The results of an audit or contests thereto could have a material adverse effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penaltiespenalties, and/or interest assessments.

We have both funded and unfunded pension and other postretirement benefit plans worldwide. As of December 31, 2024,2025, our projected benefit obligations under our pension and other postretirement benefit plans exceeded the fair value of plan assets by an aggregate of approximately $50.6$46.4 million (“unfunded status”), as compared to $61.4$50.6 million as of December 31, 2023.2024. Estimates for the amount and timing of the future funding obligations of these benefit plans are based on various assumptions. These assumptions include discount rates, rates of compensation increases, expected long-term rates of return on plan assetsassets, and expected healthcare cost trend rates. If our assumptions prove incorrect, our funding obligations may increase, which may have a material adverse effect on our financial results.

We have invested the plan assets of our funded benefit plans in various equity and debt securities. A deterioration in the value of plan assets could cause the unfunded status of these benefit plans to increase, thereby increasing our obligation to make additional contributions to these plans. An obligation to make contributions to our benefit plans could reduce the cash available for working capital and other corporate uses, and may have an adverse impact on our operations, financial conditioncondition, and cash flows.

Our operations, facilitiesfacilities, and properties are subject to extensive and evolving laws and regulations pertaining to air emissions, wastewater discharges, the handling and disposal of solid and hazardous materials and wastes, the remediation of contamination, and otherwise relating to health, safetysafety, and the protection of the environment. As a result, we are involved from time to time in administrative or legal proceedings relating to environmental and health and safety matters and have in the past and will continue to incur capital costs and other expenditures relating to such matters. For example, in 2025, we recently entered into a consent decree with the United States government concerning our participation in the Environmental Protection Agency's Transition Program for Equipment Manufacturers and related matters. Refer to Note 17,18, “Commitments and Contingencies” to the Consolidated Financial Statements.Statements for additional information regarding the consent decree.

We cannot be certain that identification of presently unidentified environmental conditions, more vigorous enforcement by regulatory authorities or other unanticipated events will not arise in the future and give rise to additional environmental liabilities, compliance costscosts, and/or penalties that could be material. Further, environmental policies, lawslaws, and regulations are constantly evolving, and it is impossible to predict accurately the effect they may have upon our financial condition, results of operationsoperations, or cash flows.

In addition, increasing laws and regulations dealing with environmental aspects of the products we manufacture can result in significant expenditures in designing and manufacturing new products that satisfy such new laws and regulations. In particular, many scientists, legislatorslegislators, and others attribute climate change to increased levels of greenhouse gas emissions. While additional regulation of emissions in the future appears likely, how such new regulations would ultimately affect our business, operations or financial results is unknown at this time.

Our international sales and operations are subject to applicable laws relating to trade, tariffs, export controlscontrols, and foreign corrupt practices, the violation of which could adversely affect our operations.

We must comply with all applicable international trade, customs, tariffs, export controlscontrols, and economic sanctions laws and regulations of the United States and other countries. We are also subject to the Foreign Corrupt Practices Act and other anti-bribery laws that generally bar bribes or gifts to foreign governments or officials. The recent presidential administrations in the United States have taken, and may take additional, actions that may inhibit international trade by U.S.-based companies. Changes in trade sanctions laws may restrict our business practices, including cessation of business activities in sanctioned countries or with sanctioned parties, and may result in modifications to compliance programs. Violation of these laws or regulations could result in sanctions or fines and could have a material adverse effect on our financial condition, results of operations, cash flowsflows, and reputation.

Our designs, manufacturing processesprocesses, and facilities need to comply with applicable statutory and regulatory requirements. We may also have the responsibility to ensure that products we design satisfy safety and regulatory standards including those applicable to our customers and to obtain any necessary certifications. As a result, products that we manufacture may at times contain manufacturing or design defects, and our manufacturing processes may be subject to errors or not be in compliance with applicable statutory and regulatory requirements or demands of our customers. Potential defects in the products we manufacture or design, whether caused by a design, manufacturing or component failure or error, or deficiencies in our manufacturing processes, may result in delayed shipments to customers, replacement costscosts, or reduced or canceled customer orders. If these defects or deficiencies are significant, our business reputation may also be damaged. The failure of the products that we manufacture or our manufacturing processes and facilities to comply with applicable statutory and regulatory requirements may subject us to legal fines or penalties and, in some cases, require us to shut down or incur considerable expense to correct a manufacturing process or facility.

Any manufacturing or design defects may also result in product liability claims. Furthermore, customers use some of our products in potentially hazardous applications that can cause injury or loss of life and damage to property, equipmentequipment, or the environment. We may be named as a defendant in product liability or other lawsuits asserting potentially large claims if an accident occurs at a location where our equipment and services have been or are being used. Certain of our businesses also have experienced claims relating to past alleged asbestos exposure. We have not to date incurred material costs related to these asbestos claims. We vigorously defend ourselves against current claims and intend to do so against future claims. We also have certain insurance policies which may limit our financial exposures. Any significant liabilities which are not covered by insurance could have an adverse effect on our financial condition, results of operationoperations, and cash flows. Likewise, a substantial increase in the number of claims that are made against us or the amounts of any judgments or settlements could materially and adversely affect our reputation, the ability to obtain and the rates for insurance coverages, and our financial condition, results of operationsoperations, and cash flows.

If we do not meet customers’ product quality,quality and reliability standards and expectations, we may experience increased or unexpected product warranty claims and other adverse consequences to our business.

Product quality and reliability are significant factors influencing customers' decisions to purchase our products and aftermarket services. Inability to maintain the high quality of our products relative to the perceived or actual quality of similar products offered by competitors could result in the loss of market share, loss of revenue, reduced profitability, an increase in warranty costs, government investigationsinvestigations, and/or damage to our reputation.

We provide our customers a warranty covering workmanship, and in some cases materials, on products we manufacture. Such warranties generally provide that products will be free from defects for periods ranging from 12 months to 60 months. If a product fails to comply with the warranty, we may be obligated, at our expense, to correct any defect by repairing or replacing the defective product. Although we maintain warranty reserves in an amount based primarily on the number of units shipped and on historical and anticipated warranty claims, there can be no assurance that future warranty claims will follow historical patterns or that we can accurately anticipate the level of future warranty claims. An increase in the rate of warranty claims or the occurrence of unexpected warranty claims, for which we do not have a reserve or where we cannot recover from our vendors to the extent their materials or workmanship were defective, could materially and adversely affect our financial condition, results of operationsoperations, and cash flows.

Changes in laws or regulations, or a failure to comply with laws and regulations, may adversely affect our business, investmentsinvestments, and results of operations. We are subject to laws and regulations enacted by national, regionalregional, and local governments, including non-U.S. governments. In particular, we are required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consumingconsuming, and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investmentsinvestments, and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business and results of operations. Additionally, we may need to obtain and maintain licenses and permits to conduct business in various jurisdictions. If we or the businesses or companies we acquire have failed or fail in the future to comply with such laws and regulations, then we could incur liabilities and fines and our operations could be suspended. Such laws and regulations could also restrict our ability to modify or expand our facilities, could require us to acquire costly equipment, or could impose other significant expenditures.

Our intellectual property, including our patents, trade secrets, trademarkstrademarks, and licenses are important in the operation of our business. Although we intend to protect our intellectual property rights vigorously, we cannot be certain that we will be successful in doing so. Third parties may assert or prosecute infringement claims against us in connection with the services and products that we offer, and we may or may not be able to successfully defend these claims. Litigation, either to enforce our intellectual property rights or to defend against claimed infringement of the rights of others, could result in substantial costs and in a diversion of our resources. In addition, if a third party would prevail in an infringement claim against us, then we would likely need to obtain a license from the third party on commercial terms, which would likely increase our costs. Our failure to maintain or obtain necessary licenses or an adverse outcome in any litigation relating to patent infringement or other intellectual property matters could have a material adverse effect on our financial condition, results of operationsoperations, and cash flows.

Orders for the year ended December 31, 20242025 decreasedincreased 7.7%22.7% to $1,922.8$2,359.0 million from $2,082.3$1,922.8 million for the same period in 2023.2024. The decreaseincrease in orders was primarily due to lowerhigher demand in the Americas segment as a result of uncertainty related to the U.S. presidential election and theEURAF high-interestsegments. rateThis environment,was andpartially offset by lower demand in the MEAP assegment. aOrders resultwere offavorably slowdownsimpacted by $34.3 million from changes in Chinaforeign andcurrency Southexchange Korea.rates.

The Company’s backlog as of December 31, 20242025 was $650.2$793.5 million, a 29.1%22.0% decreaseincrease from the December 31, 20232024 backlog of $917.2$650.2 million. The decreaseincrease in backlog from December 31, 20232024 was primarily attributable to the lowerhigher orders as discussed above. Backlog was unfavorablyfavorably impacted by $12.9$32.4 million from changes in foreign currency exchange rates.

Consolidated net sales for the year ended December 31, 20242025 decreasedincreased 2.2%2.9% to $2,178.0$2,240.9 million from $2,227.8$2,178.0 million for the year ended December 31, 2023.2024. The decreaseincrease was primarily attributable to $50.6 million of higher new tower crane shipments in the EURAF segment, $51.0 million of higher non-new machine sales, and $15.5 million of higher revenue due to price realization and favorable product mix in the Americas segment. This was partially offset by lower new crane shipments in the EURAFAmericas segment and MEAPEuropean segments.mobiles This was partially offset by $16.5 million of higher non-new machine sales primarily due to higher used crane shipments.business. Net sales were unfavorablyfavorably impacted by $2.7$35.3 million from changes in foreign currency exchange rates.

Gross profit for the year ended December 31, 20242025 decreasedincreased 11.8%7.9% to $375.0$404.7 million compared to $425.2$375.0 million for the year ended December 31, 2023.2024. The decreaseincrease was primarily attributable to the lowerhigher net sales,sales unfavorableand favorable product mix,mix. andThis underwas absorptionpartially ofoffset fixedby lower absorbed costs due to lower manufacturing volume of tower cranes in the EURAFAmericas segment.segment and $6.1 million of net tariff costs.

Engineering, selling, and administrative expenses for the year ended December 31, 20242025 decreasedincreased 3.8%8.6% to $315.7$342.9 million compared to $328.3$315.7 million for the year ended December 31, 2023.2024. The decreaseincrease is primarily due to $12.3higher costs for the triennial bauma trade show and $11.6 million of lowerhigher employee-related costs when compared to the prior year. This was partially offset by $8.9 million of higher costs associated with a legal matter with the U.S. Environmental Protection Agency (“U.S. EPA”) and $3.1 million of lower employee-related costs when compared toin the prior year. ThisEngineering, wasselling, partiallyand offsetadministrative expenses were unfavorably impacted by $2.8$5.6 million of higher marketing costs from the Company’s Crane Days eventchanges in theforeign U.S.currency andexchange the China bauma trade show and $5.8 million of higher research and development costs related to new product development.rates.

Interest expense for the year ended December 31, 20242025 increaseddecreased 13%1.6% to $38.3$37.7 million compared to $33.9$38.3 million for the year ended December 31, 2023.2024. The increasedecrease was primarily due to higher average debt and higherlower interest rates on borrowings fromunder the Company's ABL revolvingRevolving Credit Facility, partially offset by higher outstanding borrowings on the Company's other credit facility when compared to the prior year.facilities. See further detail at Note 10,11, “Debt,” to the Consolidated Financial Statements.

Other expense -– net for the year ended December 31, 20232025 was $13.0$2.2 million and was primarily composed of a $9.3$0.8 million non-cashof write-off ofnet foreign currency translationtransaction adjustments related to the curtailment of operations in Russialosses and $6.0$1.9 million of pension benefit and postretirement health costs. This wascosts, partially offset by $3.3$0.8 million of interest income net foreignof currencybank transaction gains.fees.

During the year ended December 31, 20242025 and 20232024, the Company recorded a provision for income taxes of $5.2 million and a benefit for income taxes of $44.1 million and a provision for income taxes of $5.0 million, respectively.

EURAFAmericas segment net sales decreasedincreased 8.0%5.2% in 20242025 to $616.0$1,259.9 million from $669.6$1,197.6 million in 2023.2024. The decreaseincrease was primarily attributable to ahigher lowernon-new numbermachine ofsales newand craneprice shipments,realization, partially offset by $8.6lower million of higher non-new machine sales, as a result of higher usednew crane shipments.

MEAPAmericas segment operating income of $39.4$95.7 million decreased $12.9 million from $52.3$8.0 million in 2023.2025 from $103.7 million in 2024. The decrease was primarily attributable to thelower absorbed costs due to lower realizedmanufacturing pricevolume, $7.4 million of higher engineering, selling, and unfavorableadministrative productcosts, mix.and $6.1 million of net tariff costs. This was partially offset by the higher revenue.

Net cash used for investing activities of $49.5 million in 2025 increased $9.1 million from $40.4 million in 2024 decreased $31.4 million from $71.8 million in 2023.2024. The decreaseincrease in net cash used for investing activities was primarily due to $31.7$12.9 million of cash outflows related to the purchase of certain assets and territory from Ring Power Corporation and $3.9 million of lower proceeds from the sale of property, plant, and equipment. This was partially offset by $8.2 million of lower capital expenditures.

The Company’s revolving credit facility, or other future facilities, may be used for working capital requirements, capital expenditures, funding future acquisitions (within the Company’s debt limitations), and other operating, investinginvesting, and financing needs. The Company believes its liquidity and expected cash flows from operations are sufficient to meet expected working capital, capital expenditures, contractual obligationsobligations, and other ongoing operational needs in the subsequent twelve months.

The Company has historically relied primarily on cash flows from operations, borrowings under revolving credit facilities, issuances of notesnotes, and other forms of debt financing as its sources of cash.

The Company has two non-U.S. accounts receivable financing programs with noa maximum availability.availability of €25.0 million and €40.0 million. Transactions under the non-U.S. programs were accounted for as sales in accordance with Accounting Standards Codification (“ASC”) 860, “Transfers and Servicing.” Under these financing programs, the Company has the ability to sell eligible receivables up to the customer's maximum limit. Refer to Note 11,12, “Accounts Receivable Factoring,” to the Consolidated Financial Statements.

The Company's material cash requirements, contractual obligationsobligations, and commercial commitments include the following:

The Company paid a total of $45.7$37.5 million during 20242025 for capital expenditures.expenditures, of which $18.8 million is for rental fleet assets. For the year ended December 31, 2024,2025, depreciation was $60.0$59.9 million. The Company anticipates that capital expenditures for 20252026 will be approximately $47.0$45 million to $50 million, of which approximately $23.0$25 million is for rental fleet assets.

The Company uses adjusted ROIC, adjusted net income, adjusted diluted net income per share (“Adjusted DEPS”), EBITDA, adjusted EBITDA, adjusted operating income, Adjusted ROIC and free cash flows, which are financial measures that are not prepared in accordance with GAAP, as additional metrics to evaluate the Company’s performance. The Company believes these non-GAAP measures provide important supplemental information to readers regarding business trends that can be used in evaluating its results because these financial measures provide a consistent method of comparing financial performance and are commonly used by investors to assess performance. These non-GAAP financial measures should be considered together with, and are not substitutes for, the GAAP financial information provided herein.

Adjusted ROIC is determined by dividing adjusted net operating profit after tax (“Adjusted NOPAT”) for the yearyears ended December 31, 20242025 and 2024, by the five-quarter average of invested capital. Adjusted NOPAT is calculated by taking operating income plus the addback of amortization of intangible assets and the addback or subtraction of restructuring expenses, other non-recurring items - net, and provision for income taxes, which is determined using a 15% tax rate. Invested capital is defined as net total assets less cash and cash equivalents and income tax assets - net plus short-term and long-term debt. Income taxes are defined as income tax payables/receivables, net deferred tax assets/liabilities, and uncertain tax positions.

The Company’s Adjustedadjusted ROIC for the year ended December 31, 20242025 was 6.0%.5.3%. Below is the calculation of Adjustedadjusted ROIC for the yearyears ended December 31, 2025 and 2024.

For a more detailed discussion of the Company's accounting policies and the financial instruments that weit use,uses, refer to Note 2, “Summary of Significant Accounting Policies,” Note 4,5, “Fair Value of Financial Instruments,” and Note 10,11, “Debt,” to the Consolidated Financial Statements.

The Company's long-term debt primarily consists of $300.0 million on the 2031 Notes and borrowings under its ABL Revolving Credit Facility. Borrowings under the ABL Revolving Credit Facility are subject to variable interest using either the Alternate Base Rate or Term Benchmark, Applicable Overnight Rate, CBRCBR, or RFR rate (each as defined in the ABL Credit Agreement) plus the applicable spread. The variable interest rate is based upon the average availability as of the most recent determination date. As of December 31, 2024,2025, the Company had borrowings on the ABL Revolving Credit Facility of $79.0$144.6 million. At any time, the Company could be party to various interest rate swaps in connection with its fixed or floating rate debt. No interest rate swaps were entered into or outstanding during 20242025 or 2023.2024. A hypothetical 100 basis point increase/decrease in the average interest rate of the Company's annual average borrowings under its ABL Revolving Credit Facility would have resulted in a $1.2$1.5 million increase/decrease to interest expense for the year ended December 31, 2024.2025.

Amounts invested in non-U.S. based subsidiaries are translated into U.S. dollars at the exchange rate in effect at year-end. Results of operations are translated into U.S. dollars at an average exchange rate for the period. The resulting translation adjustments are recorded in stockholders’ equity as other comprehensive income (loss). The cumulative translation adjustment recorded in other comprehensive income (loss) for the year ended December 31, 20242025 was a lossincome of $20.8$36.3 million.

Environmental, Health, Safety, ContingenciesContingencies, and Other Matters

Refer to Part II, Item 8, Note 17,18, “Commitments and Contingencies,” where the Company has disclosed environmental, health, safety, contingenciescontingencies, and other matters.

Crane attachment sales are generated through the sale of new or used crane attachments such as luffing jibs, ecomatsecomats, and counterweights. Crane attachment sales are recognized when control of the product is transferred to the customer. Control transfers to the customer generally upon delivery to the carrier.

Inventories and Related Reserve for Obsolete and Excess Inventory – Inventories are valued at the lower of cost or net realizable value. Finished goods and work-in-process inventories include material, laborlabor, and manufacturing overhead costs. Inventories are reduced by a reserve for excess and obsolete inventories. The estimated reserve is based upon specific identification of excess or obsolete inventories based on historical usage and estimated future usage.

On AprilMay 30,1, 2026, the Company voluntarily submitted a prior disclosure to U.S. Customs and Border Protection (“CBP”) related to potential errors in the methodology used to calculate tariffs on the Company’s imports of steel and steel derivative products between April 29, 2021 and April 29, 2026. The disclosure was made proactively given uncertainty with respect to calculating certain tariffs and with the intent of mitigating potential penalties in the event errors are identified. The Company has paid approximately $18.0 million of Section 232 tariffs.tariffs during the 5-year period covered by the prior disclosure. The Company believes it has a strong legal and factual basis for the method of calculation and the amount of tariffs paid. The Companyfinal intends to vigorously defend any allegations of noncompliance; however, the ultimate outcomeresolution of this matter iscould uncertain.result in material incremental tariffs, refunds, credits, interest, or legal or administrative costs, and could materially adversely affect our business, financial condition, results of operations, or cash flows.

Orders for the three months ended MarchJune 31,30, 2026 increased 5.8%56.1% to $645.7$708.7 million from $610.3$453.9 million for the same period in 2025. The increase in orders was primarily attributable to higher demand in theall Company’s MEAP and EURAF segments. This was partially offset by lower demand inof the Company’s Americas segment due to large stocking orders in the three months ended March 31, 2025 that did not reoccur.segments. Orders were favorably impacted by $25.7$6.5 million from changes in foreign currency exchange rates.

As of MarchJune 31,30, 2026, total backlog was $939.9$1,050.1 million, an increase of 18.4%32.3% from the December 31, 2025 backlog of $793.5 million, and an increase of 17.8%44.0% from the MarchJune 31,30, 2025 backlog of $797.8$729.3 million. Backlog was unfavorably impacted by $16.0$44.6 million from December 31 2025 and was favorably impacted by $20.7 million from March 31, 2025, from changes in foreign currency exchange rates.rates since December 31, 2025 and was unfavorably impacted by $9.8 million from changes in foreign currency exchange rates since June 30, 2025.

Results of Operations For the Three and Six Months Ended MarchJune 31,30, 2026 and 2025:

Consolidated net sales for the three months ended MarchJune 31,30, 2026 increased 5.0%10.3% to $494.6$594.9 million from $470.9$539.5 million in the same period in 2025. This increase was primarily attributable to $14.4$69.0 million of higher new machine sales in the Company's tower product line in the EURAF segment and $5.1MEAP segments and $10.6 million of higher non-new machine sales.sales across all three segments. This was partially offset by $7.2$24.1 million of lower new machine sales in the MEAPCompany’s Americas segment. Net sales were favorably impacted by $18.9$6.5 million from changes in foreign currency exchange rates.

Gross profit for the three months ended MarchJune 31,30, 2026 increased 6.1%24.3% to $95.3$123.1 million as compared to $89.8$99.0 million for the same period in 2025. The increase was primarily due to $11.8 million of benefit from the refund of tariffs previously paid under the IEEPA and higher non-new machine sales and higher new machine revenue across the Company's EURAF and MEAP segments. This was partially offset by unfavorable$2.5 productmillion mixof andhigher incrementalyear over year other tariff related costs. Gross profit was favorably impacted by $3.4$1.2 million from changes in foreign currency exchange rates.

Gross profit percentage for the three months ended MarchJune 31,30, 2026 increased to 19.3%20.7% as compared to 19.1%18.4% for the same period in 2025. The improvement in gross profit percentage was primarily due to the net tariff benefit discussed above.

Engineering, selling, and administrative expenses for the three months ended MarchJune 31,30, 2026 increased 9.3%3.4% to $90.6$90.4 million from $82.9$87.4 million for the same period in 2025. The increase was primarily due to marketing expenses related to the Conexpo triennial trade show and higher employee costs. Engineering, selling, and administrative expenses were unfavorably impacted by $3.8$1.1 million from changes in foreign currency exchange rates.

Interest expense for the three months ended MarchJune 31,30, 2026 and 2025 was $8.9$9.2 million as compared to $8.7 million for the same period in 2025. Interest expense increased year-over-year primarily due to higher average outstanding balances on the Company's ABL Revolving Credit Facility.million. See further detail at Note 10, “Debt” to the Condensed Consolidated Financial Statements.

Other Income (Expense) - Net

Other income (expense) - net was $3.1$(0.2) million of expense during the three months ended MarchJune 31,30, 2026 and $5.0income of $1.0 million for the same period in 2025. Other income (expense) - net during the three months ended MarchJune 31,30, 2026 was primarily composed of $3.3 million of net currency transaction losses and $0.1 million of pension related costs,losses, partially offset by $0.4$2.4 million of interest income.income, which includes $0.9 million of interest received from IEEPA tariff refunds, and $0.5 million of gains on disposal of certain assets. Other expense - netincome during the three months ended MarchJune 31,30, 2025 was primarily composed of $4.9$2.0 million of net currency transactiongain. lossesThis andwas partially offset by $0.5 million of pension related costs,costs partiallyand offset by $0.3$0.6 million of interest income.related to settlement of the matter with the U.S. Environmental Protection Agency ("EPA").

Provision (Benefit) for Income Taxes

For the three months ended MarchJune 31,30, 2026 and 2025, the Company recorded a provision for income taxes of $7.2 million and benefit for income taxes of $3.3$(0.2) million, respectively. For the six months ended June 30, 2026 and 2025, the Company recorded a provision for income taxes of $3.9 million and $2.5a benefit for income taxes of $(2.7) million, respectively. Changes to jurisdictional mix and year-to-date income before income taxes resulted in a provision for income taxes in the three and six months ended June 30, 2026 as compared to the prior year's benefit for income taxes. In addition, the Company’sCompany's effective tax rate varies from the U.S. federal statutory rate of 21% due to results of foreign operations that are subject to income taxes at different statutory rates and losses in certain jurisdictions where no tax benefit can be realized.

Americas segment net sales increaseddecreased 3.5%6.6% for the three months ended MarchJune 31,30, 2026 to $268.4$301.9 million from $259.3$323.2 million for the same period in 2025. The increasedecrease was primarily attributable to $24.1 million of lower new machine sales, partially offset by higher non-new machine sales and price realization, partially offset by lower new crane sales.

Americas segment operatingnet incomesales decreased $5.5 million2.1% for the threesix months ended MarchJune 31,30, 2026 to $12.2$570.3 million from $17.7$582.5 million for the same period in 2025. The decrease was primarily attributable to unfavorable$19.6 productmillion mixof andlower incrementalnew tariffmachine costs.sales, partially offset by higher non-new machine sales.

MEAPAmericas segment netoperating salesincome decreasedincreased 10.9%$6.1 million for the three months ended MarchJune 31,30, 2026 to $58.8$32.2 million from $66.0$26.1 million for the same period in 2025. The decreaseincrease was primarily attributable to $7.2$11.8 million of benefit from the refund of tariffs previously paid under the IEEPA, partially offset lower new machine sales dueand toby lower$2.5 shipments into the Middle East as a resultmillion of thehigher Iranyear war.over MEAPyear segmentother nettariff salesrelated were favorably impacted by $3.8 million from changes in foreign currency exchange rates.costs.

MEAPAmericas segment operating income decreasedincreased $3.3$0.6 million for the threesix months ended MarchJune 31,30, 2026 to $8.1$44.4 million from $11.4$43.8 million for the same period in 2025. The decreaseincrease was primarily dueattributable to $11.8 million of benefit from the refund of tariffs previously paid under the IEEPA, partially offset by lower netsales sales.and MEAP segment operating income was favorably impacted by $0.7$4.6 million fromof changeshigher inyear foreignover currencyyear exchangeother rates.tariff related costs.

A summary of cash flows for the threesix months ended MarchJune 31,30, 2026 and 2025 are as follows:

Cash flows provided by operating activities of $27.4$35.4 million for the threesix months ended MarchJune 31,30, 2026 increased $14.5$90.2 million from $12.9$54.8 million of cash used by financing activities for the same period in 2025. The increase in net cash provided by operating activities was primarily driven by $15.0a $42.6 million payment to settle a legal matter with the U.S. EPA made in 2025, $33.2 million of higher cash provided by the net change in operating assets and liabilities.liabilities, and $26.2 million of cash receipts from the refund of tariffs paid under IEEPA.

Net cash used for investing activities of $7.9$20.3 million for the threesix months ended MarchJune 31,30, 2026 decreased $15.7$9.2 million from $23.6$29.5 million for the same period in 2025. The decrease in net cash used for investing activities was primarily due to $12.9 million of cash outflows in the prior year related to the purchase of certain assets and territory from Ring Power CorporationCorporation, partially offset by an increase in capital expenditures of $3.7 million, net of proceeds from property, plant, and $2.6equipment millionin ofthe lowercurrent capital expenditures.year.

Net cash usedprovided forby financing activities of $17.5$4.1 million for the threesix months ended MarchJune 31,30, 2026 decreased $20.7$62.9 million from $3.2$67.0 million of cash provided by financing activities for the same period in 2025. The increasedecrease in net cash usedprovided forby financing activities was primarily due to $17.9a reduction of $56.0 million of borrowings in the prior year as compared to $9.0 million of payments in the current year under the ABL Revolving Credit Facility.

The Company’s liquidity position as of MarchJune 31,30, 2026 and2026, December 31, 2025 and June 30, 2025 is summarized as follows:

In addition to the ABL Revolving Credit Facility, the Company has access to committed and non-committed lines of credit to fund working capital in Europe and China. There are sevensix facilities, of which five facilities are denominated in Euros totaling €37.0 million and twoone facilitiesfacility denominated in Chinese Yuan totaling ¥80.0 million. On April 2, 2026, the Company cancelled its ¥30.0 million Chinese Yuan denominated facility, reducing total liquidity by $4.450.0 million. Total U.S. dollar availability as of MarchJune 31,30, 2026 for the sevensix facilities was $54.4$49.6 million, with $4.4 million outstanding.

Outstanding debt as of MarchJune 31,30, 2026 and December 31, 2025 is summarized as follows:

Both the ABL Revolving Credit Facility and 2031 Notes include customary covenants and events of default. Refer to Note 10, “Debt,” to the Condensed Consolidated Financial Statements for additional discussions of covenants under the ABL Revolving Credit Facility and 2031 Notes. As of MarchJune 31,30, 2026, the Company was in compliance with all affirmative and negative covenants in its debt instruments, inclusive of the financial covenants pertaining to the ABL Revolving Credit Facility and 2031 Notes. Based upon management’s current plans and outlook, the Company believes it will be able to comply with these covenants during the subsequent twelve months. From time to time, the Company seeks to opportunistically raise capital in the debt capital markets and bank credit markets.

The Company uses EBITDA, adjusted EBITDA, adjusted operating income,income (loss), adjusted net loss,income (loss), adjusted diluted net income (loss) per share ("“adjusted DEPS"”), adjusted return on invested capital ("“adjusted ROIC"”) and free cash flows, which are financial measures that are not prepared in accordance with GAAP, as additional metrics to evaluate the Company’s performance. The Company believes these non-GAAP measures provide important supplemental information to readers regarding business trends that can be used in evaluating its results because these financial measures provide a consistent method of comparing financial performance and are commonly used by investors to assess performance. These non-GAAP financial measures should be considered together with, and are not substitutes for, the GAAP financial information provided herein.

The Company’s Adjusted ROIC as of MarchJune 31,30, 2026 was 5.1%.6.9%. Below is the calculation of Adjusted ROIC as of MarchJune 31,30, 2026 and 2025.

The adjustments in 2026 represent the addback of $0.5$2.5 million of costs associated with a legal matter and $0.3 million of other one-time costs. The adjustment in 2025 represents the addback of $3.6 million of costs associated with a legal matter with the EPA.