Financial Analysis

Revenues Three Months Ended (thousands) June 27, 2026 June 28, 2025 Tires (a) $ 133,136 $ 138,396 Maintenance 77,378 82,928 Brakes 41,842 44,469 Steering 26,366 26,741 Batteries 4,299 4,206 Exhaust 3,726 3,906 Franchise royalties 382 389 Total $ 287,129 $ 301,035 (a) Includes the sale of tire road hazard warranty agreements and tire delivery commissions.

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Note 4 Fair Value Long-term debt had a carrying amount that approximates a fair value of $ 108.4 million as of June 27, 2026, as compared to a carrying amount and a fair value of $ 60.0 million as of March 28, 2026. The carrying value of our debt approximated its fair value due to the variable interest nature of the debt. …

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Note 3 Income Taxes For the three months ended June 27, 2026, our effective income tax rate was ( 7.7 ) percent compared to 24.8 percent for the three months ended June 28, 2025. The difference from the statutory rate is primarily due to state taxes and the discrete tax impact related to share-based awards and other adjustments, none of which are individually significant. …

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Note 8 Commitments and Contingencies Commitments Commitments Due by Period Within Within 2 to Within 4 to After (thousands) Total 1 Year 3 Years 5 Years 5 Years Principal payments on long-term debt $ 108,435 $ $ 108,435 $ $ Finance lease commitments/financing obligations (a) 267,198 46,047 78,428 56,112 86,611 Operating lease commitments (a) 235,317 47,515 75,740 48,892 63,170 Total $ 610,950 $ 93,562 $ 262,603 $ 105,004 $ 149,781 (a) Finance and operating lease commitments represent future undiscounted lease payments and include $ 42.9 million and $ 29.3 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised. Contingencies We are currently a party to various claims and legal proceedings incidental to the conduct of our business. If management believes that a loss arising from any of these matters is probable and can reasonably be estimated, we will record the amount of the loss, or the minimum estimated liability when the loss is estimated using a range, and no point within the range is more probable than another. As additional information becomes available, any potential liability related to these matters is assessed and the estimates are revised, if necessary. Litigation is subject to inherent uncertainties, and unfavorable rulings could occur and may include monetary damages. If an unfavorable ruling were to occur, there exists the possibility of a material adverse impact on the financial position and results of oper …

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Note 7 Long-term Debt Credit Facility In April 2019, we entered into a five-year $ 600 million revolving credit facility agreement with eight banks (the Credit Facility) that includes an accordion feature permitting us to request an increase in availability of up to an additional $ 250 million. I n November 2022, we entered into a Third Amendment to the Credit Facility (the Third Amendment). The Third Amendment, among other things, extended the term of the Credit Facility to November 10, 2027 , and amended certain of the financial terms in the Credit Facility . The Third Amendment amended the interest rate charged on borrowings to be based on 0.10 percent over the Secured Overnight Financing Rate ( SOFR ), replacing the previously used LIBOR. In addition, one additional bank was added to the bank syndicate for a total of nine banks now within the syndicate. Under the Third Amendment, we were required to maintain an interest coverage ratio, as defined in the Credit Facility, of at least 1.55 to 1. In addition, our ratio of adjusted debt to EBITDAR, as defined in the Credit Facility, cannot exceed 4.75 to 1, subject to certain exceptions under the Credit Facility. These terms are modified during the Further Extended Covenant Relief Period, described below. On May 23, 2024, we entered into a Fourth Amendment to the Credit Facility (the Fourth Amendment). Among other changes, the Fourth Amendment modified the definition of EBITDAR to permit add-backs relating to expenses, and res …

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Recent accounting pronouncements In November 2024, the Financial Accounting Standards Board (FASB) issued new accounting guidance, ASU 2024-03, Income Statement Reporting Comprehensive Income Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which requires disclosures about specific expense categories, including but not limited to, purchases of inventory, employee compensation, depreciation, amortization and operating, selling, general and administrative expenses. The guidance is effective for annual reporting periods beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. We are currently evaluating the impact of adopting this guidance. In September 2025, the FASB issued new accounting guidance, ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , which removes references to prescriptive software development stages and includes an updated framework for capitalizing internal software costs. The guidance is effective for annual reporting periods beginning after December 15, 2027, and for interim periods within that fiscal year. We are currently evaluating the impact of adopting this guidance. In December 2025, the FASB issued new accounting guidance, ASU 2025-11, Interim Reporting (Topic 270): Narrow Scope Improvements , which clarifies the scope and requirements for i …

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Note 12 Related Parties and Transactions The Board of Directors of the Company appointed Peter D. Fitzsimmons to serve as the President and Chief Executive Officer as of March 28, 2025. At this time, Mr. Fitzsimmons was serving as a partner and managing director of AlixPartners, LLP (AlixPartners). In connection with Mr. Fitzsimmons appointment, the Company entered into a consulting agreement with AP Services, LLC (APS), an affiliate of AlixPartners , pursuant to which APS provided for Mr. Fitzsimmons to serve as the Companys Chief Executive Officer and for the additional resources of APS personnel as required. On December 2, 2025, the Company entered into an employment agreement with Peter Fitzsimmons, whereby he continues to serve as our President and Chief Executive Officer, and appointed him as a member of the Board of Directors at which time Mr. Fitzsimmons ceased serving as partner and managing director of AlixPartners and the consulting agreement with APS was terminated. On December 23, 2025, the Company entered into a new consulting agreement with AlixPartners pursuant to which AlixPartners will provide consulting services to the Company under various statements of work at standard engagement rates to support the Operational Improvement Plan. See Note 16 of our Form 10-K for the fiscal year ended March 28, 2026 for additional information. The Company recorded total expenses related to AlixPartners and APS of $ 1.0 million and $ 5.4 million in operating, selling, gener …

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Note 6 Revenues Automotive undercar repair, tire replacement sales and tire related services represent the vast majority of our revenues. We also earn revenue from the sale of tire road hazard warranty agreements, commissions earned from the delivery of tires on behalf of certain tire vendors, as well as franchise royalties. Revenue from automotive undercar repair, tire replacement sales and tire related services is recognized at the time the customers take possession of their vehicle or merchandise. For sales to certain customers that are financed through the offering of credit on account, payment terms are established for customers based on our pre-established credit requirements. Payment terms may vary depending on the customer and generally are 30 days. Based on the nature of receivables, no significant financing components exist. Sales are recorded net of discounts, sales incentives and rebates, sales taxes and estimated returns and allowances. We estimate the reduction to sales and cost of sales for returns based on current sales levels and our historical return experience. Such amounts are immaterial to our consolidated financial statements. Revenues Three Months Ended (thousands) June 27, 2026 June 28, 2025 Tires (a) $ 133,136 $ 138,396 Maintenance 77,378 82,928 Brakes 41,842 44,469 Steering 26,366 26,741 Batteries 4,299 4,206 Exhaust 3,726 3,906 Franchise royalties 382 389 Total $ 287,129 $ 301,035 (a) Includes the sale of tire road hazard warranty agreements and tir …

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Note 11 Segment Reporting The Company has a single reportable operating segment Monro, Inc. The accounting policies of the operating segment are the same as those described in Note 1 of our Form 10-K . The Companys chief operating decision maker (CODM) is the Chief Executive Officer, who regularly reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance for the Companys single reportable segment. The CODM primarily focuses on consolidated net income to evaluate its reportable segment. The CODM also uses consolidated net income for evaluating pricing strategy and to assess the performance for determining the compensation of certain employees. All segment expenses reviewed, which represent the difference between segment revenue and segment net loss, consisted of the following: Segment Reporting (thousands) June 27, 2026 June 28, 2025 Sales $ 287,129 $ 301,035 Less: Cost of sales, including occupancy costs 173,284 181,090 Operating, selling, general and administrative expenses 94,498 110,429 Depreciation and amortization expenses 15,652 15,591 Interest expense, net of interest income 4,635 4,784 Other segment items (a) 1,056 ( 158 ) Provision for (benefit from) income taxes 153 ( 2,651 ) Net loss $ ( 2,149 ) $ ( 8,050 ) (a) Other segment items consist of other expense (income), net, included in the accompanying Consolidated Statements of Loss and Comprehensive Loss. As of June 27, 2026 and June 28, …

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