Financial Analysis

Acquisition The Company's acquisitions are accounted for using the acquisition method of accounting and the results of the acquired businesses are included in its condensed consolidated financial statements from the date of acquisition. Historically, acquisitions have been made at prices above the fair value of identifiable net assets, resulting in goodwill. Acquisition costs were $2,253,000 in the third quarter of 2025 and $3,498,000 in the nine months ended September 27, 2025 and are included in selling, general and administrative (SG&A) expenses in the accompanying condensed consolidated statement of income. On July 9, 2025, the Company acquired all the outstanding equity securities of Babbini S.p.A and G.P.S. Engineering S.r.l (collectively, Babbini), two Italy-based companies specializing in industrial dewatering and engineered power transmission solutions, for $16,483,000, net of cash acquired. The fair value of assets acquired totaled $35,470,000, including cash of $4,863,000, inventory of $13,825,000, property, plant, and equipment of $5,355,000, and intangible assets of $5,278,000. The fair value of liabilities assumed was $14,124,000, including customer deposits of $3,857,000 and accounts payable of $2,954,000. Babbini is part of the Company's Industrial Processing segment. The Company funded the acquisition through borrowings under its revolving credit facility. See Note 11 , Subsequent Events, for details on the Company's acquisition that occurred on October 7 …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

Commitments and Contingencies Right of Recourse In the ordinary course of business, the Company's Chinese subsidiaries may receive banker's acceptance drafts from customers as payment for their trade accounts receivable. The drafts are non-interest bearing obligations of the issuing bank and generally mature within six months of the origination date. The Company's Chinese subsidiaries may use these banker's acceptance drafts prior to the scheduled maturity date to settle outstanding accounts payable with vendors. Banker's acceptance drafts transferred to vendors are subject to customary right of recourse provisions prior to their scheduled maturity dates. The Company had $8,046,000 at September 27, 2025 and $7,952,000 at December 28, 2024 of banker's acceptance drafts subject to recourse, which were transferred to vendors and had not reached their scheduled maturity dates. Historically, the banker's acceptance drafts have settled upon maturity without any claim of recourse against the Company. Litigation From time to time, the Company is subject to various claims and legal proceedings covering a range of matters that arise in the ordinary course of business. Such litigation may include, but is not limited to, claims and counterclaims by and against the Company for breach of contract or warranty, canceled contracts, product liability, or bankruptcy-related claims. For legal proceedings in which a loss is probable and estimable, the Company accrues a loss based on the low end o …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Long-Term Obligations Long-term obligations are as follows: September 27, 2025 December 28, 2024 (In thousands) Revolving Credit Facility, due 2030 $ 248,075 $ 278,384 Senior Promissory Notes, due 2025 to 2028 6,660 6,660 Finance Leases, due 2025 to 2029 1,985 2,023 Other Borrowings, due 2025 to 2028 1,285 1,460 Total 258,005 288,527 Less: Current Maturities of Long-Term Obligations (3,386) (3,376) Long-Term Obligations $ 254,619 $ 285,151 See Note 8 , Fair Value Measurements and Fair Value of Financial Instruments, for the fair value information related to the Company's long-term obligations. Revolving Credit Facility On September 26, 2025, the Company entered into an eighth amendment and joinder (the Eighth Amendment) to its unsecured multi-currency revolving credit facility, originally dated as of March 1, 2017 (as amended and restated to date, the Credit Agreement). The Eighth Amendment, among other things, increased the Company's aggregate borrowing capacity from $400,000,000 to $750,000,000 and extended the maturity date from November 30, 2027 to September 26, 2030. In addition to the increased committed borrowing capacity, an uncommitted, unsecured incremental borrowing facility of $200,000,000 continues to be available under the Credit Agreement. Interest on borrowings outstanding under the Credit Agreement accrues and is payable in arrears calculated at one of the following rates selected by the Company: (i) the Base Rate, as defined, plus an applicable margin of 0.2 …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents revenue by revenue recognition method: Three Months Ended Nine Months Ended September 27, September 28, September 27, September 28, (In thousands) 2025 2024 2025 2024 Point in Time $ 254,491 $ 238,971 $ 706,995 $ 701,199 Over Time 17,076 32,643 59,049 94,155 $ 271,567 $ 271,614 $ 766,044 $ 795,354 The following table presents the disaggregation of revenue by product type and geography: Three Months Ended Nine Months Ended September 27, September 28, September 27, September 28, (In thousands) 2025 2024 2025 2024 Revenue by Product Type: Parts and consumables $ 188,366 $ 176,961 $ 549,457 $ 520,836 Capital 83,201 94,653 216,587 274,518 $ 271,567 $ 271,614 $ 766,044 $ 795,354 Revenue by Geography (based on customer location): North America $ 165,708 $ 172,186 $ 483,546 $ 501,220 Europe 65,869 57,309 178,440 176,289 Asia 23,893 26,724 63,536 74,248 Rest of world 16,097 15,395 40,522 43,597 $ 271,567 $ 271,614 $ 766,044 795,354

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Stock-Based Compensation The Company recognized stock-based compensation expense of $2,696,000 in the third quarter of 2025, $2,627,000 in the third quarter of 2024, $8,516,000 in the first nine months of 2025 and $7,926,000 in the first nine months of 2024 within SG&A expenses in the accompanying condensed consolidated statement of income. The Company recognizes compensation expense for all stock-based awards granted to employees and directors based on the grant date estimate of fair value for those awards. The fair value of RSUs is based on the grant date price of the Company's common stock, reduced by the present value of estimated dividends foregone during the requisite service period. For time-based RSUs, compensation expense is recognized ratably over the requisite service period for the entire award based on the grant date fair value, and net of actual forfeitures recorded when they occur. For performance-based RSUs, compensation expense is recognized ratably over the requisite service period for each separately vesting portion of the award based on the grant date fair value, net of actual forfeitures recorded when they occur, and remeasured each reporting period until the total number of RSUs to be issued is known. Unrecognized compensation expense related to stock-based compensation totaled $11,316,000 at September 27, 2025, which will be recognized over a weighted average period of 1.7 years. Non-Employee Director RSUs On May 14, 2025, the Company granted an agg …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

Fair Value Measurements and Fair Value of Financial Instruments Fair value measurement is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy is established, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1Quoted prices in active markets for identical assets or liabilities. Level 2Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. Level 3Unobservable inputs based on the Company's own assumptions. The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis: Fair Value as of September 27, 2025 (In thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds and time deposits (a) $ 31,129 $ $ $ 31,129 Banker's acceptance drafts (b) $ $ 8,861 $ $ 8,861 Liabilities: Contingent consideration (c) $ $ $ 1,766 $ 1,766 Fair Value as of December 28, 2024 (In thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds and time deposits (a) $ 21,248 $ $ $ 21,248 Banker's acceptance drafts (b) $ $ 5,299 $ $ 5,299 Liabilities: Forward currency-exchange contracts (d) $ $ 39 $ $ 39 Contingent consideration (c) $ $ $ 1,678 $ 1,678 (a) Included in cash and cash equivalents in the accompanying con …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Provision for Income Taxes The provision for income taxes was $29,416,000 in the first nine months of 2025 and $31,810,000 in the first nine months of 2024. The effective tax rate of 27% in the first nine months of 2025 was higher than the Companys statutory rate of 21% primarily due to nondeductible expenses, the distribution of the Companys worldwide earnings, state taxes, and the cost of repatriating the earnings of certain foreign subsidiaries. These items were offset in part by a net tax benefit from the re-measurement of certain deferred income tax assets and liabilities due to the decrease to Germany's future statutory tax rate enacted in July 2025 and foreign tax credits. The effective tax rate of 26% in the first nine months of 2024 was higher than the Company's statutory rate of 21% primarily due to the distribution of the Company's worldwide earnings, nondeductible expenses, state taxes, and the cost of repatriating the earnings of certain foreign subsidiaries. These items were offset in part by foreign tax credits. …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Recent Accounting Pronouncements Not Yet Adopted Intangibles - Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. In September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2025-06 which improves the practicality of the guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. Under this ASU, eligible software development costs will begin capitalization when management has authorized and committed to funding the software project, it is probable that the project will be completed, and the software will be used to perform the function intended. This ASU is effective for fiscal year 2028, with early adoption permitted and may be applied retrospectively. The Company is currently evaluating the effect that the adoption of this ASU will have on its consolidated financial statements. Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. In July 2025, the FASB issued ASU No. 2025-05, to provide for a practical expedient permitting an entity to assume that conditions at the balance sheet date remained unchanged over the life of the asset when estimating expected credit losses for current accounts receivable and current contract assets accounted for under ASC 606, Revenue from Contracts with Custome …

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Business Segment Information The Company is a global supplier of technologies and engineered systems that drive Sustainable Industrial Processing and operates in three reportable segments consisting of its Flow Control segment, Industrial Processing segment, and Material Handling segment. The Company aggregated its operating segments into its reportable segments where they contained similar products and economic characteristics, and shared similar types of customers, and production and distribution methods. The Flow Control segment is comprised of its fluid-handling and its doctoring, cleaning, & filtration operating segments, and the Industrial Processing segment is comprised of its wood processing and its fiber processing operating segments. Each of the Company's reportable segments is led by a segment vice president, who reports directly to the Chief Executive Officer (CEO). The Company has determined that its CEO is its Chief Operating Decision Maker (CODM) who is responsible for assessing performance and allocating resources. The CODM utilizes segment gross profit margin and segment operating income margin to evaluate the performance of each segment and allocate resources effectively. The CODM primarily reviews these profit measures in comparison to forecasts, trends, key performance targets, and results of industry peers to assess profitability, identify areas for improvement, and make strategic decisions regarding investments and resource allocation within each seg …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Subsequent Events Acquisition On October 7, 2025, the Company acquired Clyde Industries Holdings, Inc. and its subsidiaries (Clyde Industries) pursuant to a securities purchase agreement for $175,000,000 in cash, subject to customary adjustments. Clyde Industries is a manufacturer of highly engineered boiler efficiency and cleaning system technologies, with revenue of approximately $92,000,000 for its fiscal year ended February 28, 2025. Clyde Industries is headquartered in Atlanta, Georgia, with operations in Brazil, China, Indonesia, Canada, Finland, Columbia and India and has approximately 400 employees worldwide. Clyde Industries is part of the Company's Industrial Processing segment. As a result of the acquisition, the Company expects to expand its product sales into new markets by leveraging Clyde Industries' existing presence. The Company has not yet completed its preliminary assessment of the fair value of the assets acquired and liabilities assumed in this acquisition, including the valuation of intangible assets and goodwill, due to the proximity of the acquisition to the issuance of these condensed consolidated financial statements. Accordingly and as permitted by ASC 80 5, Business Combinations , the Company is unable to provide further disclosures, including the allocation of the purchase price for this acquisition at this time. Borrowings Under the Credit Agreement In October 2025, the Company borrowed $170,000,000 under its existing revolving credit facility, p …

SubsequentEventsTextBlock · excerpt; the full note is in the filing