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

The businesses of many of our customers are to varying degrees cyclical and have experienced, and may continue to experience, periodic downturns. Cyclical changes and specific industry eventsevents, including changes in demand for the construction of data centers, could also affect sales of products in our businesses. Downturns in the business cycles of our different operations may occur at the same time, which could exacerbate any adverse effects on our business. In addition, certain of our businesses have seasonal and weather-related fluctuations, particularly within certain of our heating products businesses within our HVAC reportable segment. Historically, many of our key businesses generally have tended to have stronger performance in the second half of the year. See “MD&A - Results of Continuing Operations and Results of Reportable Segments.Segments and Corporate Expense.”

Demand for most of our products and services depends on the level of new capital investment and planned maintenance expenditures by our customers. The level of capital expenditures by our customers fluctuates based on planned expansions, new builds and repairs, commodity prices, general economic conditions, availability of credit, funding available from government sources, and expectations of future market behavior. Although to our knowledge no one customer accounted for more than 10% of our consolidated revenues, many of our businesses derive revenues from large projects or key customer relationships and any of the aforementioned factors, whether individually or in the aggregate, could have a material adverse effect on our customers and, in turn, our business, financial condition, results of operations and cash flows.

On the other hand, declining commodity prices may cause our customers to delay or cancel projects relating to the production of such commodities. Reduced demand for, or increased costs of, our products and services could result in the delay or cancellation of existing or future orders, or lead to excess manufacturing capacity, which unfavorably impacts our absorption of fixed manufacturing costs.costs, including those resulting from anticipated plant expansions. Reduced demand may also erode average selling prices in the relevant market.

Our business with government agencies, including sales to prime contractors that supply these agencies, is subject to government contracting risks. U.S. and other government contracts are subject to termination by the government, either for the convenience of the government or for default as a result of our failure to perform under the applicable contract. If terminated by the government as a result of our default, we could be liable for additional costs the government incurs in acquiring undelivered goods or services from another source and any other damages it suffers. In addition, if we or one of our divisionsbusinesses were charged with wrongdoing with respect to a U.S. government contract, the U.S. government could suspend us from bidding on or receiving awards of new government contracts pending the completion of legal proceedings. If convicted or found liable, the U.S. government could subject us to fines, penalties, repayments and treble and other damages, and/or bar us from bidding on or receiving new awards of U.S. government contracts and void any contracts found to be tainted by fraud. The U.S. government also reserves the right to debar a contractor from receiving new government contracts for fraudulent, criminal or other seriously improper conduct. In addition, changes in focus or reductions in budgetary funding available to government or municipal agencies to which we sell could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The price and availability of raw materials and components has and may adversely affect our business.

We are exposed to a variety of risks relating to the price and availability of raw materials and components. In recent years, we have faced volatility in the prices of many key raw materials (e.g., steelsteel, aluminum, oil, and oilcopper) and key components (e.g., circuit boards), including price increases in response to trade laws and tariffs and shortages related to supply chain disruptions, including as a result of public health crises, geopolitical events or other factors. Increases in the prices of raw materials and components, including as a result of new or increased tariffs or the impact of new trade laws, or shortages or allocations of materials and components may have a material adverse effect on our financial position, results of operations or cash flows, as there may be delays in our ability, or we may not be able, to pass cost increases on to our customers, or our sales may be reduced. We are subject to, or may enter into, long-term supplier contracts that may increase our exposure to pricing fluctuations.

The loss of, or substantial damage to, one or more of our facilities, our information system infrastructure or the facilities of our suppliers could make it difficult to manufacture our products and fulfill customer orders. Severe weather events (such as flooding, tornadoes or hurricanes), earthquakes, tsunamis, fires, explosions, acts of war, terrorism, civil unrest, or outbreaks, epidemics or pandemics of infectious diseases (such as the recent COVID-19 pandemic), orders or actions by government authorities or requirements of law, embargoes or blockades, national or regional emergencies, telecommunications breakdowns, power outages or shortages, or other events beyond our reasonable control could adversely impact our operations.

We have divested a number of businesses, including the Spin-Off in 2015.businesses. With respect to some of these former businesses, we have contractually agreed to indemnify the counterparties against, or otherwise retain, certain liabilities, including certain lawsuits, tax liabilities, product liability claims, and environmental matters. Even without ongoing contractual indemnification obligations, we could be exposed to liabilities arising out of the businesses for certain activities prior to the divestitures. In addition, certain of the counterparties to those divestitures and/or the divested businesses have agreed to indemnify us or assume certain liabilities relating to those divestitures. However, there can be no assurance that the indemnity or assumption of liability by the counterparties or divested businesses will be sufficient to protect us against the full amount of these liabilities, or that a counterparty or divested business will be able to fully satisfy its obligations. Third parties also could seek to hold us responsible for any of the liabilities that a counterparty or divested business agreed to assume. Even if we ultimately succeed in recovering any amounts for which we were initially held liable, we may be temporarily required to bear these losses ourselves.

Many of our customers historically have tended to delay capital projects, including expensive maintenance and upgrades, during economic downturns. Poor macroeconomic conditions could negatively impact our businesses by adversely affecting, among other things, our:

•Customers’ orders, including order cancellation activity or delays on new or existing orders;

•Customers’ ability to pay amounts due to us; and

•Suppliers’ and distributors’ ability to perform and the availability and costs of materials and subcontracted services.services; and

Downturns in global economies could negatively impact ourOur results of operations and prospects.prospects could be negatively impacted by downturns in economic conditions in relevant global and North American markets, including as a result of international trade tensions, the imposition, or threat of imposition, of tariffs and other trade barriers, including any new or increased tariffs or trade barriers announced by the U.S. government, and retaliatory tariffs announced in response thereto. In addition, economic instabilities resulting from geopolitical activities, including instabilities associated with armed conflicts, and the imposition of governmental sanctions in response thereto, and any conflict or threat of conflict that may affect Taiwannations relevant to our business or anythe otherbusinesses nations,of our customers and vendors, could negatively impact our results of operations and prospects.

•Customs, tariffs and trade restrictionsrestrictions, including the expiration or negotiation of free trade agreements such as the United States-Mexico-Canada Agreement, may make it difficult or impossible for us to move our products or assets across borders in a cost-effective manner, may increase the price of our products which may lead to lost business, and may increase the cost of our raw materials, including raw materials sourced domestically;

There is growingcontinuing concern that increases in global average temperatures as a result of increased concentration of carbon dioxide and other greenhouse gases in the atmosphere will cause significant adverse long-term climate changes, as well as more near-term changes in weather patterns that could adversely impact our operations. Moreover, growing concern over climate change may result in additional legal or regulatory requirements to disclose levels of carbon dioxide and other greenhouse gas emissions or that are designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment. Many of our manufacturing plants and the products we manufacture, particularly in the HVAC reportable segment, use significant amounts of electricity generated by burning fossil fuels, which releases carbon dioxide. Additionally, many of the products we manufacture in the HVAC reportable segment use natural gas or oil as a fuel source and may be subject to increasing regulatory restrictions aimed at “de-carbonization” or the elimination of such fuel sources. Increased energy usage or compliance costs and expenses as a result of increased legal or regulatory requirements may cause disruptions in, or an increase in the costs associated with, the manufacturing and distribution of our products and we may be required to develop product improvements to satisfy developing energy-efficiency targets in order to remain competitive. The impacts of climate change and legal or regulatory initiatives to address climate change could have a long-term adverse impact on our business and results of operations. If we fail to achieve or improperly report on our progress on environmental and sustainability programs and initiatives or fail to develop product improvements to satisfy developing energy-efficiency targets, the results could have an adverse impact on our business, results of operations and financial condition.

In addition, under recently implemented governmental requirements, we willhave incurincurred additional costs in complying with climate-related reporting mandates. Under laws enactedand regulations adopted in California, we, and other companies doing business in California that exceed requisite financial thresholds, will beare subject to extensive climate-related reporting. TheCertain of these laws and regulations are subject to pending legal challenges. Unless the reporting requirements of the California laws and related regulations are invalidated or substantially reduced as a result of these legal challenges, they will result in increased compliance costs and could result in regulatory reporting risks. Failure to comply with laws and regulations can have adverse consequences, including civil, administrative, and criminal penalties as well as a negative impact on the Company’s reputation, business, results of operations and cash flows.

Expectations from investors, customers, team members, certain government agencies and other third parties for reporting on sustainability and social responsibility matters have increased,increased over the past several years, and our ability to meet those expectations is dependent on a variety of factors, including cooperation from sourcing vendors and other third parties and having access to consistent and reliable data. Negative customer perceptions regarding the safety and sourcing of the products we sell and the sufficiency and transparency of our reporting on such matters and events that give rise to actual, potential, or perceived sustainability, social responsibility and similar concerns could hurt our reputation, result in lost sales, cause our customers to seek alternative sources for their needs and make it difficult and costly for us to regain the confidence of our customers.

IT security threats are increasing in frequency and sophistication.sophistication, including state-sponsored attacks coordinated by certain foreign governments. We have experienced, and expect to continue to experience, cyber-attacks on our IT systems and networks. Cyber-attacks may be random, coordinated, or targeted, including sophisticated computer crime threats. These threats pose a risk to the security of our systems and networks, and those of our business partners and third-party service providers, and to the confidentiality, availability, and integrity of our data. Despite our implementation of security measures, cybersecurity threats, such as malicious software, ransomware, phishing attacks, computer viruses, and attempts to gain unauthorized access, cannot be completely mitigated and may become more virulent due to further development through the application of artificial intelligence. Our business, reputation, operating results, and financial condition could be materially adversely affected if, as a result of a significant cyber event or otherwise, our operations or industrial processes are disrupted or shutdown; our confidential, proprietary information is stolen or disclosed; the performance or security of our cloud-based product offerings is impacted; our intranet and internet sites are compromised; data is manipulated or destroyed; we incur costs or are required to pay fines in connection with stolen customer, employee, or other confidential information; we must dedicate significant resources to system repairs or increase cyber security protection; or we otherwise incur significant litigation or other costs.

In addition, newer generations of certain of our products include IT systems, including systems that are cloud-based and/or interconnect through the internet. These systems are subject to the same cybersecurity threats described above and the failure of these systems, including by cyber-attack, could disrupt our customers’ business, leading to potential exposure for us.

Our profitability and cash flows may be adversely affected during any periods of unexpected or rapid increases in interest rates. WeOur maintain asenior credit agreement withincludes both term loan facilities and a revolving credit facility. Borrowings under these facilities accrue interest at either an alternate base rate or Term Secured Overnight Financing Rate (“SOFR”) plus, in each case, an applicable margin based on our consolidated leverage ratio as defined in theour senior credit agreement. A significant increase in Term SOFR or the other benchmark rates used in determining the alternative base rate would significantly increase our cost of borrowings. Further, any changes in regulatory standards or industry practices, such as the discontinuation of the use of Term SOFR and/or the transition to alternative benchmark rates may result in the usage of higher interest rates under theour senior credit agreement, and our current or future indebtedness may be adversely affected. We are also exposed to risks if the U.S. Federal Reserve raises its benchmark interest rate, which may reduce the availability of, and increase the cost of, obtaining new debt and refinancing existing indebtedness.

We may use derivative financial instruments in order to reduce the substantial effects of currency and interest rate exposure on our cash flow and financial condition. These instruments may include foreign currency, currency swap agreements and currency option contracts, as well as interest rate swap agreements. We have entered into, and may continue to enter into, these or other hedging arrangements. By utilizing hedging instruments, we may forgo benefits that might result from fluctuations in currency exchange and interest rates. We are also exposed to the risk that counterparties to hedging contracts will default on their obligations. A default by such counterparties in performing their obligations under these hedging instruments could have an adverse effect on us.

Sales of a substantial number of shares of common stock into the public market, or the perception that these sales could occur, could have a material adverse effect on our stock price. As of December 31, 2024,2025, we had the ability to issue up to an additional 3.4093.330 shares as restricted stock units, performance stock units, or stock options under our 2019 Stock Compensation Plan. We also may issue a significant number of additional shares, in connection with acquisitions, through a registration statement, or otherwise. For example, in 2025, we issued 3.059 shares of our common stock for cash in a registered public offering. Additional shares issued would have a dilutive effect on our earnings per share.

Ongoing geopolitical conflicts, and governmental actions implemented in response to these conflicts, did not have a significant adverse impact on our operating results during the periods presented. We are monitoring the availability of certain raw materials that are supplied by businesses in the countries impacted by these conflicts. However, at this time, we do not expect the potential adverse impact to be material to our operating results. These conflicts have created significant additional demand for certain products within our communication technologies business. The longer-term impact of these global events on our business is currently unknown due to the uncertainty around their duration and broader impact.

•On February 7, 2024, we completed the acquisition of Ingénia ◦The purchase price for Ingénia was Canadian Dollar (“CAD”) 393.9 (or $292.0 at the time of purchase),$292.0, net of (i) an adjustment to the purchase price of $2.1 received during 2024 related to acquired working capital and (ii) cash acquired of $1.5.

◦On August 30, 2024, we entered into an amendment to the Amendedprior anditeration Restated Credit Agreement governingof our senior credit facilities (as amended, the “Credit Agreement”).agreement.

◦The amendment increasesincreased the aggregate revolving credit commitments available under the Creditprior Agreementsenior credit agreement from $500.0 to $1,000.0 and makesmade certain conforming changes and other amendments to the Credit Agreement.amendments.

◦We expect to utilizeutilized the increased revolving credit capacity to finance, in part, permitted acquisitions, to pay related fees, costs and expenses and for other lawful corporate purposes.

◦During the third quarter of 2024, we renewed, and increased the capacity of, our trade receivables financing agreement for a period of 12 months, whereby we cancould borrow, on a continuous basis, up to $100.0, as available.

◦See Note 13 to our consolidated financial statements for additional details.details of our indebtedness.

•Changes in Estimated Fair Value of an Equity Security - Filtran

◦We recorded a loss of $4.2 within “Other expense,income (expense), net” related to decreases in the estimated fair value of anthe equity security in Filtran that we hold.

◦In connection with our acquisition of the ULC Technologies (“ULC”) business in September 2020, the seller of ULC was eligible for contingent consideration of up to $45.0 under an earn-out provision.

◦During the third quarter of 2021, we concluded that none of the milestones for the payment of any of the contingent consideration had beenwere achieved.

◦The settlement agreement required a payment by us to the seller of ULC of $8.4, which was paid during the second quarter of 2024, with a corresponding charge recorded within “Other operating expense, netexpense” within our consolidated statement of operations. We expect this payment to be tax deductible in future periods.

•Resolution of claims with Prime Contractor of the South Africa Power Projects ◦On September 5, 2023, SPX and our DBT Technologies (PTY) LTD (“DBT”) subsidiary entered into an agreement with Mitsubishi Heavy Industries Power — ZAF (f.k.a. Mitsubishi-Hitachi Power Systems Africa (PTY) LTD) (“MHI”) to affect the negotiated resolution of all claims between the parties with respect to DBT’s involvement in two large power projects in South Africa - Kusile and Medupi (the “Settlement Agreement”).

◦On April 21, 2023, thea prior iteration of theour Creditsenior Agreementcredit agreement was amended to provide for an additional senior secured term loan in the aggregate amount of $300.0, which was borrowed during the second quarter of 2023.

◦The funds from the additional term loan (“Incremental Term Loan”) were used to partially fund the acquisition of ASPEQ.

◦See Note 13 to our consolidated financial statements for additional details.details of our indebtedness.

◦During the fourth quarter of 2023, we recorded a charge within “Other operating expense, netexpense” of $9.0 related to the resolution of a dispute with a former representative at one of our businesses within the Detection and Measurement reportable segment.

As a result of the Supreme Court’s decision invalidating the tariffs imposed by the U.S. government in 2025 under IEEPA, entities that paid such tariffs, including the Company, are entitled to seek refunds the U.S. government for payments of the invalidated tariffs. The ultimate availability, timing, and amount of any such refunds we may receive is uncertain and could be subject to further legal, regulatory, and administrative developments.

In 2025, the U.S. government imposed a series of tariffs on many U.S. trading partners pursuant to the International Emergency Economic Powers Act of 1977 (“IEEPA”). On February 20, 2026, the United States Supreme Court issued a ruling invalidating tariffs previously imposed under IEEPA. The ultimate availability, timing, and amount of any potential refunds of such tariffs could be subject to further legal, regulatory, and administrative developments. Following the Supreme Court’s decision, the U.S. government announced its intention to invoke other laws to collect tariffs and announced new tariffs on imports from many countries, in addition to any existing non-IEEPA tariffs. There remains substantial uncertainty regarding the duration of existing and newly announced tariffs, potential changes or pauses to such tariffs, tariff levels, and whether further additional tariffs or other retaliatory actions may be imposed, modified, or suspended, and the impacts of such actions on our business. As of MarchJune 28,27, 2026, wethe haveamount notof recognized an assetassets related to any potential tariff refund.refunds Thewas not significant to our condensed consolidated balance sheet. While the Company will continuecontinues to evaluate new informationreview and will recognize acompile refund when,requests and if,may record additional refund amounts in the future, the amount canis benot reasonablyanticipated estimatedto have a material impact to our financial position and theresults rightof to receive the amount becomes realized or realizable in accordance with Accounting Standard Codification (“ASC 450”), Contingencies.operations.

Ongoing geopolitical conflicts, including the armed conflicts in the Middle East, and governmental actions implemented in response to these conflicts, did not have a significant adverse impact on our operating results during the three and six months ended MarchJune 28,27, 2026 and MarchJune 29,28, 2025. We are monitoring the availability of certain raw materials that are (i) supplied by businesses in the countries impacted by these conflicts and (ii) impacted by closures or disturbances to critical shipping routes. At this time, we do not expect the potential direct impact to be material to our operating results. These conflicts have created significant additional demand for certain products within our communication technologies business. The longer-term impact of these global events on our business is currently unknown due to the uncertainty around their duration and broader impact.

▪Acquired on January 20, 2026 for cash consideration of $140.2, net of cash acquired of $1.3, andwhich was funded through cash on hand.

▪Crawford United's industrial and transportation products businesses (“Non-core businesses”), which includes businesses serving aerospace, defense, transportation, and marine markets, are non-core to our long-term strategy. These Non-core businesses were recorded as assets held for sale upon acquisition, with their results reported as discontinued operations while we identified a suitable buyer and executed our plan to sell these businesses within twelve months. On March 27, 2026, we completed the sale of the Non-core businesses for an aggregate cash sale price of $60.0. In connection with the sale, we received net cash of $59.2, net of cash and debt contributed of $1.4 and $2.2, respectively, resulting in a loss of $5.7 recorded to “Loss on disposition of discontinued operations, net of tax” within the condensed consolidated statement of operations for the six months ended June 27, 2026.

•Changes in Estimated Value of an Equity Security - Filtran Group Equity, LLC (“Filtran”) ◦During the threesix months ended MarchJune 29,28, 2025, we recorded a gain of $4.5 within “Other income (expense), net” related to increases in the estimated value of an equity security in Filtran that we hold, with no change in the estimated value of the equity security recorded during the three and six months ended MarchJune 28,27, 2026.

Revenues for the three months ended MarchJune 28,27, 2026 totaled $566.8,$679.0, compared to $482.6$552.4 during the respective period in 2025. The increase in revenues during the three months ended March 28, 2026,revenues, compared to the respective prior-yearperiod period,in 2025, was due primarily to (i) inorganic revenue growth resulting from the Sigma & Omega, Thermolec, and Crawford acquisitions within the HVAC reportable segment and the KTS acquisition within the Detection and Measurement reportable segment, and (ii) organic revenue growth within the HVAC and Detection and Measurement reportable segments.segments, and (ii) inorganic revenue growth resulting from the Sigma & Omega, Crawford and Thermolec acquisitions within the HVAC reportable segment.

During the three and six months ended MarchJune 28,27, 2026, we generated operating income of $87.7,$115.0 and $202.7, respectively, compared to $66.6$86.6 and $153.2 for the respective periodperiods in 2025.

The unaudited information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements contained in our 2025 Annual Report on Form 10-K. Interim results are not necessarily indicative of results for the full year. We establish actual interim closing dates using a fiscal calendar, which requires our businesses to close their books on the Saturday closest to the end of the first calendar quarter, with the second and third quarters being 91 days in length. Our fourth quarter ends on December 31. The interim closing dates for the first, second and third quarters of 2026 are March 28, June 27, and September 26, compared to the respective March 29, June 28, and September 27 dates of 2025. We had one less day in the first quarter of 2026 and will have one more day in the fourth quarter of 2026 than in the respective 2025 periods. It is not practicable to estimate the impact of the one less day on our consolidated operating results for the three months ended March 28, 2026, when compared to the consolidated operating results for the 2025 respective period.

The following table provides selected financial information for the three and six months ended MarchJune 28,27, 2026 and MarchJune 29,28, 2025:

Revenues — The increase in revenues for the three months ended MarchJune 28,27, 2026, compared to the respective period in 2025, was due primarily to (i) inorganic revenue growth resulting from the Sigma & Omega, Thermolec, and Crawford acquisitions within the HVAC reportable segment and the KTS acquisition within the Detection and Measurement reportable segment, and (ii) organic revenue growth within the HVAC and Detection and Measurement reportable segments.segments, and (ii) inorganic revenue growth resulting from the Sigma & Omega, Crawford and Thermolec acquisitions within the HVAC reportable segment.

Gross Profit — For the three and six months ended MarchJune 28,27, 2026, the increase in gross profit and gross profit as a percentage of revenues,profit, compared to the respective periodperiods in 2025, was due primarily to (i) favorable product mix within the Detection and Measurement reportable segment, inclusive of higher software-as-a-service revenue within our transportation systems business which has higher than typical margins, and (ii) the impact of the organic and inorganic revenue growth mentioned above,above. partiallyThe offsetdecrease in gross profit as a percentage of revenues was primarily driven by lower margins within our HVAC reportable segment driven by (i) start-up costs and related inefficiencies associated with our capacity expansion initiatives.initiatives, (ii) net tariff headwinds and inflationary cost increases, and (iii) the respective 2025 periods benefiting from a more accretive mix and favorable project execution, primarily within our cooling equipment business, partially offset by favorable product related mix within our Detection and Measurement reportable segment.

Selling, General and Administrative (“SG&A”) Expense — For the three months ended MarchJune 28,27, 2026, the increase in SG&A expense, compared to the respective period in 2025, was due primarily to (i) increases in personnel costs due to annual merit increases and growth-related headcount additions, (ii) incremental SG&A resulting from the acquisitions of SigmaThermolec & Omega, Thermolec,and Crawford andof KTS$6.9, (ii) higher personnel-related costs, including the results of $1.9,annual merit increases and growth related headcount additions, commissions, and higher short-term incentive compensation of $5.3, and (iii) higher travelprofessional and advertising costs supporting our growthfees of $1.2,$3.6 associated with strategic initiatives, partially offset by lower acquisition and integration-related costs of $1.1.$3.2.

Selling, General and Administrative — Intangible Amortization — For the three and six months ended MarchJune 28,27, 2026, the increase in intangible asset amortization expense,amortization, compared to the respective periodperiods in 2025, was primarily related to incremental amortization associated with (i) customer backlog from the Crawford acquisition and (ii) other intangible assets associated with the acquisitions of Sigma & Omega, Thermolec, CrawfordThermolec and Crawford. The increase for the six months ended June 27, 2026 was also impacted by a full quarter'ssix months of amortization related to the KTS acquisition.

Special Charges, net — Special charges, netnet, for the three and six months ended MarchJune 28,27, 2026 and MarchJune 29,28, 2025 related primarily to recording, and subsequent adjustments of, severance and asset impairment costs associated with restructuring actions.actions at businesses within our HVAC and Detection and Measurement reportable segments. See Note 7 to our condensed consolidated financial statements for additional details.

Other Income (Expense), net — Other expense, net, for the three months ended MarchJune 28,27, 2026 was composed primarily of pension and postretirement expense of $1.3, environmental remediation charges of $1.2, expense derived from company-owned life insurance (“COLI”) policies of $0.4,$2.3, environmental remediation charges of $1.8, and pension and postretirement expense of $1.2, partially offset by foreign currency transaction lossesgains of $0.1.$0.3.

Other income,expense, net, for the threesix months ended MarchJune 29,27, 20252026 was composed primarily of aexpense gainfrom environmental remediation charges of $4.5$3.0, related to a change in the net asset value$2.7 of our equity security in Filtran and $1.7 of incomeexpense derived from COLI policies, partially offset by environmental remediation charges of $1.2,and pension and postretirement expense of $1.4$2.5, (includingpartially netoffset settlement and actuarial losses of $0.8),by foreign currency transaction lossesgains of $0.5, and losses on disposal of property, plant and equipment of $0.4.$0.2.

Interest Expense, net — Interest expense, net, includes both interest expense and interest income. The decrease in interest expense, net, during the three and six months ended MarchJune 28,27, 2026, compared to the respective periodperiods in 2025, was the result of lower average debt balances resulting from the repayment in the third quarter of 2025 of borrowings then-outstanding under our revolving credit facility from a portion of the net proceeds of the underwritten public offering of our common stock completed in that quarter. This was partially offset by the borrowings associated with the Crawford United acquisition. Refer to Note 12 to the condensed consolidated financial statements for additional details.

Income Tax Provision — For the three months ended MarchJune 28,27, 2026, we recorded an income tax provision of $13.0$22.9 on $77.4$102.2 of pre-tax income from continuing operations, resulting in an effective rate of 16.8%.22.4%. This compares to an income tax provision for the three months ended MarchJune 29,28, 2025 of $6.2$17.4 on $57.9$69.9 of pre-tax income from continuing operations, resulting in an effective rate of 10.7%.24.9%. The most significant item impacting the income tax provision for the firstsecond quarters of 2026 and 2025 was $7.0$2.8 of tax benefit and $8.5,$0.8 of tax provision, respectively, ofrelated excessto revisions to liabilities for uncertain tax benefits resulting from stock-based compensation awards that vested and/or were exercised during the periods.positions.

Revenues — For the three and six months ended MarchJune 28,27, 2026, the increase in revenues, compared to the respective periodperiods in 2025, was due primarily to organic revenue growth and inorganic revenue growth resulting from the Sigma & Omega, Thermolec,Thermolec and Crawford acquisitions and organic revenue growth.acquisitions. The organic revenue growth was due primarily to (i) higher volumes of cooling productsequipment primarily associated with increased data center demand and higher throughput resulting from increased capacitycapacity, and (ii) higher volumes of our heating products.

Income — For the three and six months ended MarchJune 28,27, 2026, the increase in income, compared to the respective periodperiods in 2025, was due primarily attributable to the revenue growth mentioned above. The declinedecrease in margin,margin for the three and six months ended June 27, 2026, compared to the respective periodperiods in 2025, was primarily due primarily to incremental(i) start-up costs and related inefficiencies associated with our capacity expansion initiatives, partially(ii) offsetnet bytariff leverageheadwinds onand fixedinflationary costs,cost particularlyincreases, and (iii) the respective 2025 periods benefiting from a more accretive mix and favorable project execution primarily within SG&Aour expenses,cooling drivenequipment by the higher volumes mentioned above.business.

Backlog — The segment had backlog of $755.3$918.8 and $451.3$539.5 as of MarchJune 28,27, 2026 and MarchJune 29,28, 2025, respectively. Backlog associated with the Crawford, Thermolec,Crawford and Sigma & OmegaThermolec acquisitions totaled $73.1, $2.2,$61.4 and $55.0,$0.8, respectively, as of MarchJune 28,27, 2026.

Income — For the three and six months ended MarchJune 28,27, 2026, the increasesincrease in income and margin,income, compared to the respective periodperiods in 2025, werewas due primarily due to the revenue growth mentioned aboveabove. The increase in margin for the three and six months ended June 27, 2026, compared to the respective periods in 2025, was primarily due to (i) a more favorable product mix,mix inclusivewithin our communication technologies and aids to navigation businesses, (ii) operating leverage, including on SG&A costs, of the higher revenue mentioned above, and (iii) benefits related to our cost optimization initiatives. In addition, the six month period ended June 27, 2026, included increased high margin software-as-a-service revenue within our transportation systems business which has higher-than-typical margins.business.

Backlog — The segment had backlog of $333.0$312.4 and $345.5$365.4 as of MarchJune 28,27, 2026 and MarchJune 29,28, 2025, respectively.

Corporate Expense — Corporate expense generallyprimarily relates to the personnel and general operating costs of our corporate headquarters in Charlotte, North Carolina. The increase in corporate expense during the three months ended MarchJune 28,27, 2026, compared to the respective period in 2025, was primarily due to (i) higher expensepersonnel-related relatedcosts, toincluding acquisitionannual merit increases and integration-relatedhigher costsshort-term ofincentive $0.5,compensation predominantly driven by the Crawfordexpense, and Thermolec(ii) acquisitions.an increase in professional fees associated with strategic initiatives.

Long-Term Incentive Compensation Expense — Long-term incentive compensation expense represents our consolidated expense, which we do not allocate for segment reporting purposes. Long-term incentive compensation expense in 2026 included awards granted to key employees of recently acquired businesses.

Listed below are the cash flows from (used in) operating, investing, and financing activities and discontinued operations, as well as the net change in cash and equivalents for the threesix months ended MarchJune 28,27, 2026 and MarchJune 29,28, 2025.

Operating Activities — The increase in cash flows from operating activities duringfor the threesix months ended MarchJune 28,27, 2026, compared to the respectivesix periodmonths inended June 28, 2025, was due primarily to (i) amounts paid into an escrow account during the first quarter of 2025 in connection with the KTS acquisition related to future service obligations of certain employees of $46.5,$46.5 asand well as(ii) the increase in income, exclusive of the non-cash items, generated from continuing operations during the threesix months ended MarchJune 28,27, 2026. ThisCash increaseoutflows wasin the first six months of 2026 to build inventory levels in support of our growth in revenue and backlog were partially offset by growth-related increases toin workingaccounts capital,payable inclusivebased on the timing of growthvendor ininvoicing inventoryand topayments support our higher backlog.made.

Investing Activities — Cash flows used in investing activities of continuing operations for the threesix months ended MarchJune 28,27, 2026 were comprised primarily of net cash utilized in the acquisitionsCrawford ofand Thermolec and Crawfordacquisitions of $439.6 and capital expenditures of $18.5$39.6 (inclusive of $10.8$27.4 related to capacity expansions for our engineered air movement and handling and cooling productsequipment businesses within the HVAC reportable segment), partially offset by net proceeds from COLI policies of $3.1.$3.3.

Cash flows used in investing activities of continuing operations for the threesix months ended MarchJune 29,28, 2025 were comprised primarily of net cash utilized in acquisitions, including KTS,KTS and Sigma & Omega, of $304.1$447.7 and capital expenditures of $5.5,$13.2, partially offset by net proceeds from COLI policies of $3.0.$3.1.

Financing Activities — Cash flows from financing activities of continuing operations for the threesix months ended MarchJune 28,27, 2026 were comprised primarily of net borrowings under our credit facilities and trade receivables financing arrangement of $150.0$40.0 and $22.0,$73.0, respectively, primarily in connection with the Crawford acquisition and net borrowings under our other various debt instruments of $0.2.acquisition. These net borrowings were partially offset by minimum tax withholdings paid on behalf of employees related to long-term incentive awards, net of proceeds from options exercised, of $14.6.

Cash flows from financing activities of continuing operations for the threesix months ended MarchJune 29,28, 2025 were comprised primarily of net borrowings under our senior credit facilities and trade receivables financing arrangement of $295.0$373.2 and $50.0,$31.0, respectively, primarily in connection with the KTS acquisition and netSigma borrowings& underOmega our other various debt instruments of $0.5.acquisitions. These net borrowings were partially offset by minimum tax withholdings paid on behalf of employees related to long-term incentive awards, net of proceeds from options exercised, of $9.8.$9.1.

Discontinued Operations — Cash flows from discontinued operations for the threesix months ended MarchJune 28,27, 2026 relate primarily to proceeds from the sale of the Non-core businesses of $59.2, net of cash and debt contributed of $1.4 and $2.2, respectively, and cash generated from the Non-core businesses during the period of ownership.

Cash flows used in discontinued operations for the threesix months ended MarchJune 29,28, 2025 relatedrelate primarily to disbursements for costs incurred to support our wound-down DBT Technologies (PTY) LTD (“DBT”) subsidiary through actionsprocesses associated with the liquidation of a subcontractor.

Change in Cash and Equivalents due to Changes in Foreign Currency Exchange Rates — Changes in foreign currency exchange rates did not have a significant impact on our cash and equivalents during the first quarterssix months of 2026 and 2025.

Borrowings — The following summarizes our debt activity (both current and non-current) for the threesix months ended MarchJune 28,27, 2026.2026:

(1)The revolving credit facility extends throughto September 9, 2030 under the terms of the agreement governing our senior credit facilities and is primarily used to provide liquidity for funding acquisitions, including related fees and expenses, and was utilized as a partial funding mechanism for the Crawford acquisition.

(2)The term loan is repayable in quarterly installments equal to 0.625% of the initial term loan balance of $500.0, beginning in December 2026 and in the first three quarters of 2027, and 1.25% during the fourth quarter of 2027, and all quarters of 2028 and 2029, and the first two quarters of 2030. The remaining balancesbalance areis payable in full on September 9, 2030. BalancesThe arebalance is net of unamortized debt issuance costs of $0.8 and $0.9 at MarchJune 28,27, 2026 and December 31, 2025, respectively.

(3)Under this arrangement, we can borrow, on a continuous basis, up to $100.0, as available. Borrowings under this arrangement are collateralized by eligible trade receivables of certain of our businesses. At MarchJune 28,27, 2026, we had $72.3$8.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $22.0.$73.0.

(4)Primarily includes balances under a purchase card program of $1.6$1.3 and $1.4 and finance lease obligations of $1.2 and $1.1 at MarchJune 28,27, 2026 and December 31, 2025, respectively. The purchase card program allows for payment beyond the normal payment terms for goods and services acquired under the program. As this arrangement extends the payment of these purchases beyond their normal payment terms through third-party lending institutions, we have classified these amounts as short-term debt.

(5)“Other” includes the impact of amortization of debt issuance costs associated with the term loan.

At MarchJune 28,27, 2026, we were in compliance with all covenants of the agreement governing our senior credit facilities.agreement.

Availability — At MarchJune 28,27, 2026, we had $1,347.3$1,457.3 of available borrowing capacity under our revolving credit facility, after giving effect to borrowings under the domestic revolving loan facility of $150.0$40.0 and $2.7 reserved for outstanding letters of credit. In addition, at MarchJune 28,27, 2026, we had $17.1$17.6 of available issuance capacity under our foreign credit instrument facilities after giving effect to $7.9$7.4 reserved for outstanding letters of credit.