Financial Analysis

NOTE 7 FINANCING ARRANGEMENTS On May 24, 2024, the Company and the Bank executed the Second Amended and Restated Replacement Credit Agreement with an expiration date of May 31, 2027 (the Credit Agreement), which was amended on October 23, 2025. The Credit Agreement has a base lending commitment amount of $35.0 million and establishes the interest rate for revolving loans at the Secured Overnight Financing Rate ( SOFR ) plus 1.85%. In addition to the base commitment, the credit facility includes an accordion feature that allows for an additional commitment amount of $30.0 million, subject to certain conditions. The Company may use the borrowing ability to cover other credit instruments issued by the Bank for the Companys use in the ordinary course of business as defined in the Credit Agreement. Further, on May 31, 2024, the Company entered into a companion facility, in the amount of $25.0 million, pursuant to which an overseas subsidiary of the Company may cause the Banks European entity to issue letters of credit on its behalf that will be secured by a blanket parent company guarantee that was issued by Argan to the Bank. As of April 30, 2026 and January 31, 2026, the Company did not have any borrowings outstanding under the Credit Agreement. However, the Bank has issued a letter of credit in the outstanding amount of $0.5 million as of April 30, 2026. As of January 31, 2026, the outstanding total amount of letters of credit was $0.3 million. The Company has pledged most of i …

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Three Months Ended April 30, 2026 2025 United States $ 253,853 $ 181,106 Republic of Ireland 24,141 9,888 United Kingdom 12,960 2,666 Consolidated revenues $ 290,954 $ 193,660 …

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NOTE 10 STOCK-BASED COMPENSATION Stock-based compensation expense amounts for the three months ended April 30, 2026 and 2025 were $2.0 million and $1.2 million, respectively. As of April 30, 2026, there was $18.7 million in unrecognized compensation costs related to outstanding stock awards that the Company expects to recognize over the next three years. During the three months ended April 30, 2026, the Company awarded performance-based restricted stock units covering a target of 596 shares of common stock, earnings per share performance-based restricted stock units covering a target of 12,583 shares of common stock, and time-based restricted stock units covering 10,701 shares of common stock. The number of shares of common stock to be issued under certain awards may exceed the number of target shares if certain performance goals are exceeded. The changes in the maximum number of shares of common stock issuable pursuant to outstanding restricted stock units for the three months ended April 30, 2026 are presented below (shares in thousands): Weighted- Average Grant-Date Fair Value Shares Per Share Outstanding, February 1, 2026 231 $ 53.19 Granted 41 $ 260.75 Issued (87) $ 33.64 Outstanding, April 30, 2026 185 $ 107.83 During the three months ended April 30, 2026, the Company awarded nonqualified stock options to purchase 955 shares of common stock at a weighted-average exercise price per share of $588.28. During the three months ended April 30, 2026, nonqualified stock options …

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NOTE 4 FAIR VALUE MEASUREMENTS The following table presents the Companys financial instruments as of April 30, 2026 and January 31, 2026 that are measured and recorded at fair value on a recurring basis: April 30, 2026 January 31, 2026 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Inputs Inputs Inputs Inputs Inputs Inputs Cash equivalents: Money market funds $ 150,939 $ $ $ 149,597 $ $ Available-for-sale securities: U.S. Treasury notes 444,905 403,599 Totals $ 150,939 $ 444,905 $ $ 149,597 $ 403,599 $ …

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NOTE 11 PROVISION FOR INCOME TAXES The Companys effective income tax rate (ETR) for the three months ended April 30, 2026 and 2025 was 14.3% and 24.3%, respectively. The Companys ETR for the three months ended April 30, 2026 differed from the U.S. federal statutory rate of 21% primarily due to stock-based compensation windfall. The Companys ETR for the three months ended April 30, 2025 differed from the U.S. federal statutory rate primarily due to the unfavorable effects of state income taxes. For the three months ended April 30, 2026 and 2025, the amount of cash paid for income taxes, net of refunds received, was insignificant. Solar Energy Projects The Company holds equity investments in Solar Tax Credit (STC) investments. Primarily, the STC investments are structured as limited liability companies that invest in solar energy projects that are eligible to receive energy tax credits. As of April 30, 2026 and January 31, 2026, the investment accounts balances were $1.5 million and $1.7 million, respectively, which are included in other assets in the condensed consolidated balance sheets. As of April 30, 2026, we had no remaining cash investment commitments related to the STC investments. These investments are expected to provide positive overall returns over their expected lives. The Company has STC investments that qualify for the proportional amortization method (PAM). For these investments, the Company recognized income tax credits and other income tax benefits of less tha …

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NOTE 9 LEGAL CONTINGENCIES In the normal course of business, the Company may have pending claims and legal proceedings. The Company maintains accrued expense balances for the estimated amounts of legal costs expected to be billed related to any significant matter. In the opinion of management, based on information available at this time, there are no current claims and proceedings that would have a material adverse effect on the consolidated financial statements. However, the outcomes of such legal claims and proceedings are subject to inherent uncertainties. In March 2025, the U.K. subsidiary of the Company sued EP NI Energy Limited and EP UK Investment Limited (together referred to as EP) in the High Court of Justice, Business and Property Courts of England and Wales for EPs breach of contract and failure to remedy various events which negatively impacted the schedule and costs of an overseas project, resulting in EP receiving the benefits of the construction efforts of the Companys U.K. subsidiary and the corresponding progress on the project without making payments to which the Companys U.K. subsidiary was contractually entitled. The Companys U.K. subsidiary provided the project owner notice to terminate because of project owner breaches of the contract. Those breaches were not resolved, as a result of which the contract terminated on May 3, 2024. Subsequently, the project owner made a draw for the full amount of a $9.9 million irrevocable letter of credit, or on-demand p …

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Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which requires public business entities to disclose specific information about certain costs and expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effects, if any, that the adoption of ASU 2024-03 may have on its financial position, results of operations, cash flows, or disclosures. There are no other recently issued accounting pronouncements that have not yet been adopted that the Company considers material to its condensed consolidated financial statements. …

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NOTE 2 REVENUES FROM CONTRACTS WITH CUSTOMERS Disaggregation of Revenues The following table presents consolidated revenues for the three months ended April 30, 2026 and 2025, disaggregated by the geographic area where the corresponding projects were located: Three Months Ended April 30, 2026 2025 United States $ 253,853 $ 181,106 Republic of Ireland 24,141 9,888 United Kingdom 12,960 2,666 Consolidated revenues $ 290,954 $ 193,660 Revenues for projects located in Ireland and the U.K. are attributed to the Power segment. The major portions of the Companys consolidated revenues are recognized pursuant to fixed-price contracts with most of the remaining portions earned pursuant to time-and-material contracts. Consolidated revenues are disaggregated by reportable segment in Note 15 to the condensed consolidated financial statements. Contract Assets and Liabilities During the three months ended April 30, 2026 and 2025, there were no material unusual or one-time adjustments to contract assets or contract liabilities balances. The Company recognized the following revenues that were included in the contract liabilities balances at the beginning of the respective period: Three Months Ended April 30, 2026 2025 Revenues recognized from contract liabilities $ 222,618 $ 146,520 Contract retentions are billed amounts which, pursuant to the terms of the applicable contract, are not paid by customers until a defined phase of a contract or project has been completed and accepted. These retai …

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NOTE 15 SEGMENT REPORTING Segments represent components of an enterprise for which discrete financial information is available that is evaluated regularly by the Companys chief executive officer, who is the Companys chief operating decision maker (the CODM), in determining how to allocate resources and in assessing performance. The CODM primarily uses income before income taxes to assess the performance of the Companys business segments and to make resource allocation determinations. The CODM may also use gross profit and income from operations as supplemental measures when assessing segment performance. The Companys reportable segments recognize revenues and incur expenses and are organized as separate business units, each with distinct management teams, customers, talent pools, and service offerings. The Companys reportable segments may include more than one operating segment. Intersegment revenues and the related cost of revenues are netted against the corresponding amounts of the segment receiving the intersegment services. For the three months ended April 30, 2026 and 2025, intersegment revenues were $0.4 million and $1.9 million, respectively. Intersegment revenues for the three months ended April 30, 2026, primarily reflected services provided by the Teledata segment to the Industrial segment, and intersegment revenues for the three months ended April 30, 2025, primarily reflected services provided by the Industrial segment to the Power segment. Pricing for intersegmen …

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NOTE 13 STOCKHOLDERS EQUITY During the three months ended April 30, 2026 and during Fiscal 2026, the Company paid dividends to stockholders as follows: Record Date Payment Date Amount Per Share April 22, 2026 April 30, 2026 $ 0.500 January 22, 2026 January 31, 2026 0.500 October 23, 2025 October 31, 2025 0.500 July 23, 2025 July 31, 2025 0.375 April 22, 2025 April 30, 2025 0.375 On April 8, 2026, the board of directors of Argan increased the total authorization to repurchase shares of the Companys common stock by $50 million, bringing the aggregate authorized amount to $200 million. Pursuant to its established program and authorizations provided by Argans board of directors, the Company repurchased shares of its common stock during the three months ended April 30, 2026 and 2025 and added the shares to treasury stock. During these periods, the Company repurchased 6,450 shares and 55,117 shares of common stock, all on the open market, for aggregate prices of approximately $3.0 million, or $458.21 per share, and $6.8 million, or $124.25 per share, respectively. …

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