Financial Analysis

Note 4 Acquisition s Acquisitions are accounted for under the purchase method, and accordingly, the results of operations were included in the Company's financial statements from the date of acquisition. The acquisitions did not have a material impact on the Company's consolidated financial statements or the notes thereto. Effective May 1, 2026 , the Company acquired 100 % of the outstanding stock of UDlive Limited (UDlive), headquartered in Alton, England. UDlive is a provider of hardware-enabled software solutions for sewer line monitoring. The purchase consideration was $ 94.4 million, net of cash acquired, with a potential earn-out of up to an additional $ 50.0 million based on the achievement of established EBITDA targets in the 24 month period following the acquisition date. The earn-out is payable within 90 days following April 30, 2028, or, if disputed, 21 days following the agreement as to or determination of the earn-out amount. The UDlive acquisition is accounted for under the purchase method, and accordingly, the results of operations will be included in the Company's financial statements from the date of acquisition. The total purchase consideration for UDlive, net of cash acquired, was $ 94.4 million. The acquisition was funded by cash on hand. The fair value of the potential earn-out at June 30, 2026 was $ 12.0 million and was recorded as a liability. The fair value of the earn-out was calculated using a Monte Carlo simulation model which incorporated projected …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

Note 5 Contingencies, Litigation and Commitments In the normal course of business, the Company is named in legal proceedings. There are currently no material legal proceedings pending with respect to the Company. The Company is subject to contingencies related to environmental laws and regulations. A future change in circumstances with respect to specific matters or with respect to sites formerly or currently owned or operated by the Company, off-site disposal locations used by the Company, and property owned by third parties that is near such sites, could result in future costs to the Company and such amounts could be material. Expenditures for compliance with environmental control provisions and regulations during 2025 and the first half of 2026 were not material. The Company relies on single suppliers for most brass castings and certain resin and electronic subassemblies in several of its product lines. The Company believes these items would be available from other sources, but that the loss of certain suppliers could result in a higher cost of materials, delivery delays, short-term increases in inventory and higher quality control costs in the short term. The Company attempts to mitigate these risks by working closely with key suppliers, purchasing minimal amounts from alternative suppliers and by purchasing business interruption insurance where appropriate. The Company reevaluates its exposures on a periodic basis and makes adjustments to reserves as appropriate.

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Information regarding revenues disaggregated by geographic area is as follows: Three months ended Six months ended June 30, June 30, (In thousands) 2026 2025 2026 2025 Revenues: United States $ 200,413 $ 214,350 $ 379,045 $ 416,325 Foreign: Asia 3,489 4,083 7,705 7,205 Canada 3,504 4,147 6,638 8,093 Europe 12,953 11,278 24,560 20,826 Mexico 824 594 1,625 1,071 Middle East 813 2,649 4,011 5,115 Other 325 994 1,014 1,671 Total $ 222,321 $ 238,095 $ 424,598 $ 460,306 Information regarding revenues disaggregated by the timing of when goods and services are transferred is as follows: Three months ended Six months ended June 30, June 30, (In thousands) 2026 2025 2026 2025 Revenue recognized over time $ 24,754 11.1 % $ 23,086 9.7 % $ 44,081 10.4 % $ 43,372 9.4 % Revenue recognized at a point in time 197,567 88.9 % 215,009 90.3 % 380,517 89.6 % 416,934 90.6 % Total $ 222,321 100.0 % $ 238,095 100.0 % $ 424,598 100.0 % $ 460,306 100.0 %

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Note 7 Fair Value Measurements of Financial Instruments The Company applies the accounting standards for fair value measurements and disclosures for its financial assets and financial liabilities. The carrying amounts of cash and cash equivalents, receivables and payables in the financial statements approximate their fair values due to the short-term nature of these financial instruments. Included in other assets are insurance policies on various individuals who were previously employed by the Company. The carrying amounts of these insurance policies approximate their fair value.

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Note 6 Income Taxes The Company is subject to income taxes in the United States and numerous foreign jurisdictions. The Company's income tax positions are based on interpretations of income tax laws and rulings in each of the jurisdictions that the Company operates. Significant judgment is required in determining the worldwide provision for income taxes and recording the related deferred tax assets and liabilities. The Company's deferred tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income for the years in which the assets or liabilities are expected to be realized or settled. Interim provisions are based on an estimate of the overall annual rate which can vary due to the relationship of foreign and domestic earnings, state taxes and available deductions, credits and discrete items. The Company's earnings before income taxes, provision for income taxes, and effective income tax rate are as follows: Three months ended June 30, Six months ended June 30, (In thousands) 2026 2025 2026 2025 Earnings before income taxes $ 39,724 $ 45,786 $ 76,061 $ 96,573 Provision for income taxes 10,004 11,202 19,006 23,591 Effective income tax rate 25.2 % 24.5 % 25.0 % 24.4 %

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"Note 10 Revenue Recognition Revenue for sales of products and services is derived from contracts with customers. The products and services promised in contracts include the sale of utility water and flow instrumentation products, such as flow meters and radios, quality sensing, pressure monitoring and sewer line monitoring equipment, software as a service (SaaS) and other ancillary services. Contracts generally state the terms of sale, including the description, quantity and price of each product or service. Since the customer typically agrees to a stated rate and price in the contract that does not vary over the life of the contract, the majority of the Company's contracts do not contain variable consideration. The Company establishes a provision for estimated warranty and returns as well as certain after sale costs as discussed in Note 2 ""Additional Financial Information Disclosures"" in the Notes to Unaudited Consolidated Condensed Financial Statements. The Company disaggregates revenue from contracts with customers into geographical regions and by the timing of when goods and services are transferred. The Company determined that disaggregating revenue into these categories depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by regional economic factors. Information regarding revenues disaggregated by geographic area is as follows: Three months ended Six months ended June 30, June 30, (In thousands) 2026 2025 2026 2025 Revenues: …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

Note 9 Industry Segment and Geographic Areas Th e Company is an innovator, manufacturer, developer, marketer and distributor of water management solutions incorporating hardware and sensors, communication solutions and data analytics, which comprise one reportable segment. The Company concludes on their segments based on the internally reported financial information that is routinely reviewed by the chief operating decision maker (CODM) to assess financial performance, make decisions and allocate resources. The Company manages and evaluates its operations as one segment primarily due to similarities in the nature of the products, production processes, customers and methods of distribution. The Companys CODM is the Chairman, President and Chief Executive Officer. The Companys CODM assesses performance by using gross margin, operating earnings and net earnings. These metrics are analyzed by reviewing budget versus actual and prior year versus current year reporting. The various income performance measures are reviewed to ensure proper pricing strategies and effective cost controls across the organization. The CODM is regularly provided with consolidated expenses as noted on the consolidated income statements. Additionally, the CODM reviews assets at the same level as noted on the consolidated balance sheets. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Note 8 Subsequent Events The Company evaluates subsequent events at the date of the balance sheet as well as conditions that arise after the balance sheet date but before the financial statements are issued. The effects of conditions that existed at the balance sheet date are recognized in the financial statements. Events and conditions arising after the balance sheet date but before the financial statements are issued are evaluated to determine if disclosure is required to keep the financial statements from being misleading. To the extent such events and conditions exist, if any, disclosures are made regarding the nature of events and the estimated financial effects for those events and conditions. For purposes of preparing the accompanying consolidated financial statements and the notes to these financial statements, the Company evaluated subsequent events through the date that the accompanying financial statements were issued, and has determined that no material subsequent events exist through the date of this filing.

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