MLR

Our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide a summary from the perspective of management on our consolidated operating results, financial condition, liquidity, and cash flows of our Company as of and for the periods presented. The MD&A should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 Form 10-K”) and the unaudited condensed consolidated financial statements and the accompanying notes thereto included herein. To facilitate timely reporting, the condensed consolidated financial statements include accounts of certain subsidiaries whose closing dates differ from the applicable period end (December 31st or June 30th) by 31 days (or less). References to “the Company”, “we”, “us”, and “our” are intended to mean the business and operations of Miller Industries, Inc., and its consolidated subsidiaries unless the context requires otherwise. ABOUT MILLER INDUSTRIES, INC. Miller Industries, Inc. is The World’s Largest Manufacturer of Towing and Recovery Equipment®, with domestic manufacturing operations in Tennessee and Pennsylvania, and foreign manufacturing operations in France, Italy, and the United Kingdom. We develop and manufacture innovative high-quality towing and recovery equipment worldwide. We design and manufacture bodies of car carriers and wreckers, which are installed on chassis manufactured by third parties and then sold to our customers under our Century®, Vulcan®, Chevron™, Holmes®, Challenger®, Champion®, Jige™, Boniface™, Omars™, Titan®, and Eagle® brand names. Our products are primarily marketed and sold through a network of distributors that serve all 50 states, Canada, Mexico and other foreign markets, and through prime contractors to governmental entities. Furthermore, we have substantial distribution capabilities in Europe as a result of our ownership of Jige International S.A., Omars – S.p.A., and Boniface Engineering, Ltd. While most of our distributor agreements do not generally contain exclusivity provisions, management believes our independent distributors do not offer products of any other towing and recovery equipment manufacturer. We believe this is a testament of their loyalty to our brands. In addition to selling our products, our independent distributors provide end-users with parts and service. We also utilize sales representatives to inform prospective end-users about our current product lines in an effort to drive sales to independent distributors. Management believes the strength of our distribution network and the breadth and quality of our product offerings are two key advantages over our competitors. We focus on a variety of key indicators to monitor our overall operating and financial performance. These indicators include measurements of revenue, operating income, gross margin, net income, earnings per share, capital expenditures, and cash flow. Our history of innovation in the towing and recovery industry has been an important factor behind our growth over the last decade and we believe that our continued emphasis on research and development will be a key factor in our future growth. We opened a free-standing research and development facility in Chattanooga, Tennessee in 2019, where we pursue various innovations in our products and manufacturing processes, some of which are intended to enhance the safety of our employees and reduce our environmental impact. Our investments in strategic and planned projects have contributed to our increased production capacity and optimized our manufacturing processes, including investing in component re-design capabilities that allow for more flexibility in our manufacturing and sourcing. Most recently, during fiscal 2025, the Company completed the acquisition of Omars – S.p.A., a designer and manufacturer of towing and recovery vehicles. Omars, headquartered in Cuneo, Italy, has over 45 years of experience in manufacturing light-duty, medium-duty, and heavy-duty recovery vehicles and car carriers. With a highly complementary product portfolio, management believes this acquisition will expand Miller Industries’ footprint in the European market with an additional, well-recognized European brand. This acquisition will provide Miller Industries with additional capacity which the Company expects will improve its manufacturing flexibility and its ability to meet growing customer demands. TRENDS AND OTHER FACTORS AFFECTING OUR BUSINESS During 2025 and first half of 2026, we were presented with several ongoing challenges, such as the residual effect of recent years’ supply chain disruptions, inflationary pressures, and uncertainty around tariffs, all of which have impacted our profitability. Beginning in the second half of 2025, we started to experience demand headwinds, including reduced retail sales and lower order intake, which we believe were attributable to the continued high cost of equipment ownership in the elevated interest rate environment, escalating insurance costs for our customers, and the imposition of and ongoing uncertainty involving tariffs. As a result of these challenges, we strategically decreased production in 2025 to reduce field inventory in our distribution channel, we implemented certain cost savings initiatives and we continued to secure our supply chain to mitigate the long-term impacts of current and potential future tariffs. These actions during 2025 included a ​ 20 | Q2 FY 2026 FORM 10-Q ​ ​ Table of Contents ​ ​ MD&A ​ ​ reduction in workforce, which we announced in August 2025, as part of our comprehensive cost reduction plan. Under this plan, we reduced our headcount by approximately 150 positions across three of our U.S. manufacturing facilities during the third quarter of 2025. During the first half of 2026, we continued to see significant pressure on global supply chains due to economic uncertainty and geopolitical tensions, including hostilities among the United States, Israel, and Iran, and the ongoing military conflict in Ukraine, resulting in significant increases in fuel costs. This global rise in fuel costs has resulted in fewer miles driven which has, and may continue to, adversely impact the demand for our products. Accordingly, during the first half of 2026, we continued to face demand headwinds, which we believe are attributable to increased fuel costs, as well continued high cost of equipment ownership in the elevated interest rate environment, escalating insurance costs for our customers, and the imposition of and ongoing uncertainty involving tariffs. We continue to assess current and ongoing macroeconomic trends and closely monitor our production schedules and cost structure as they may be materially impacted by the effects of these pressures. We implemented a surcharge in April 2025 to partially offset these pressures; however, continued cost increases have exceeded the coverage provided by that surcharge. As a result, in May 2026, we announced that the existing surcharge would be rolled into our standard pricing structure. In addition, we announced a 3% price increase on all domestic manufactured products, which went into effect on all domestic manufactured products invoiced after July 31, 2026. These actions are intended to better align our pricing with the current cost environment while supporting our continued investment in U.S. manufacturing, product quality, safety, and regulatory compliance. Despite these past and present challenges, we believe we are well-positioned to enhance our operating results. We remain focused on meeting the needs of our customers. Ongoing communication and prioritization continue with our suppliers in an effort to identify and mitigate any future and continuing risks, and to proactively manage inventory levels of materials and component parts to align with anticipated demand for our products. However, our performance will be heavily influenced by, among other things, whether supply chain constraints and inflationary pressures continue to lessen or worsen, the continuing impact of ongoing military conflicts in the Middle East and Ukraine or other geopolitical events and developments, and the threat of recession and general economic conditions. We are actively monitoring the impact the military conflict in the Middle East may have on our fuel costs and petroleum-related products, given the recent surges in fuel prices. In addition, this military conflict has disrupted oil distribution globally, as Iran has also retaliated against ships in the Strait of Hormuz, through which approximately 20% of the world’s oil and gas is transported. A continued conflict with Iran could drive fuel prices even higher. While we believe the impacts of the conflict between the United States, Israel, and Iran will continue to have an effect on our business, financial condition and results of operations, we are unable to predict the extent or nature of these impacts at this time. In addition, while we have attempted to pass increased costs on to our customers, including through our recent surcharge and price increases on manufactured products, there can be no assurance that we will be able to continue to do so in the future. Additionally, our future performance will continue to be heavily influenced by, among other things, the high cost of equipment ownership and customer spending patterns, the continued uncertainty regarding tariffs, and regulations regarding emissions standards. In particular: ● The rising cost of equipment ownership has posed, and is expected to continue to pose, a significant challenge for end-market towers. Continuing increases in fuel costs, insurance premiums, and elevated interest rates have added cost pressures to our end-users, and fluctuations in the value of used trucks have affected trade-in values and new equipment purchases. ● We continue to experience uncertainty around tariffs, including with respect to the ongoing changes in U.S. trade policies, potential modifications to existing trade agreements, further restrictions on free trade, and any potential new or further escalation of trade tensions and retaliatory measures by foreign governments. See “Our dependence upon outside suppliers for component parts, chassis and raw materials, including aluminum, steel, and petroleum-related products, leaves us subject to changes in price and availability (including as a result of tariffs), the cadence and quantity of deliveries from our suppliers, and delays in receiving supplies of such materials, component parts or chassis” in Part I, Item 1A – “Risk Factors” in our 2025 Form 10-K for further information regarding tariffs. While we believe the diversity and strength of our supply chain leaves us well-positioned to navigate these uncertainties, we expect tariffs, in particular on specialty steel and aluminum, will continue to adversely impact the Company’s operating results. ● In recent years, regulations with near zero emission standards were adopted by certain states, which limit the amount of diesel-powered commercial vehicles that can be registered and, therefore, the number of vehicles we can sell in these states. Compliance with these regulations negatively impacted customer demand during 2024 and through the third quarter of 2025 and were expected to continue to negatively impact customer demand. However, with the EPA and Congress either revoking, or being unwilling to grant, necessary federal preemption waivers with respect to the California Air Resources Board’s regulations and other similar state laws, as well as some states pushing to limit the impact of these and similar regulations, we believe the effects of these regulations will continue to lessen throughout the remainder of 2026. For further information regarding federal and state laws and regulations governing commercial vehicle engine emissions, including the California Air Resources Board’s regulations, see “Government Regulations and Environmental Matters” in Part I, Item 1 - “Business” and “Environmental and health and safety liabilities and requirements could require us to incur material costs” in Part I, Item 1A - “Risk Factors” in our 2025 Form 10-K. ​ ​ 21 ​ Table of Contents ​ ​ MD&A ​ ​ The impact of these factors remains largely out of our control, and could continue to have an adverse impact on our production capabilities, financial results, and cash flow into the remainder of fiscal 2026. Based on preliminary valuation estimates, non-cash acquisition-related expenses associated with Omars - primarily tied to the sale of equipment adjusted to fair market value and amortization of the estimated intangible value of customer relationships - negatively impacted the Company’s financial results for the second fiscal quarter of 2026 by approximately $0.11 per diluted share. We currently anticipate that this amount represents the majority of the total acquisition-related expenses expected to be recognized in 2026. We remain confident that the acquisition will be accretive in the first year after recognizing these non-cash acquisition-related expenses. The Company continues to work with its third-party valuation consultants, and the final amounts will be adjusted upon the completion of their analysis. CRITICAL ACCOUNTING POLICIES Our condensed consolidated financial statements are prepared in accordance with GAAP, which require us to make estimates. Certain accounting policies are deemed “critical”, as they require management’s highest degree of judgment, estimations, and assumptions. The accounting policies deemed to be most critical to our financial position and results of operations are those related to allowance for credit losses, inventory, long-lived assets, business combinations, goodwill, warranty reserves, income taxes, and foreign currency translations. There have been no significant changes in our critical accounting policies during the six months ended June 30, 2026, from the information provided under the heading “Critical Accounting Policies and Sensitive Accounting Estimates” in Part II, Item 7 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2025 Form 10-K. ​ RESULTS OF OPERATIONS Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ ​ ​ June 30 ​ ​ (in thousands) ​ 2026 ​ ​ ​ 2025 ​ ​ ​ Change NET SALES ​ $ 239,993 ​ $ 214,032 ​ 12.1% COST OF OPERATIONS ​ ​ 204,057 ​ ​ 179,446 ​ 13.7% GROSS PROFIT ​ ​ 35,936 ​ ​ 34,586 ​ 3.9% OPERATING EXPENSES: ​ ​ ​ ​ ​ ​ ​ ​ Selling, general and administrative ​ ​ 25,176 ​ ​ 23,404 ​ 7.6% NON-OPERATING (INCOME) EXPENSES: ​ ​ ​ ​ ​ ​ ​ ​ Interest expense, net ​ ​ 352 ​ ​ 294 ​ 19.7% Other (income) expense, net ​ ​ 338 ​ ​ (479) ​ 170.6% Total expenses, net ​ ​ 25,866 ​ ​ 23,219 ​ 11.4% INCOME BEFORE INCOME TAXES ​ ​ 10,070 ​ ​ 11,367 ​ (11.4)% INCOME TAX PROVISION ​ ​ 2,801 ​ ​ 2,909 ​ (3.7)% NET INCOME ​ $ 7,269 ​ $ 8,458 ​ (14.1)% Net Sales Net sales for the three months ended June 30, 2026 were $240.0 million compared to $214.0 million for the corresponding period in fiscal 2025, an increase of 12.1%. The increase in net sales was primarily due to increased chassis deliveries and the inclusion of Omars sales for the full second quarter of 2026, offset by lower domestic production levels. Net foreign sales for the three months ended June 30, 2026 were $46.5 million compared to $38.1 million for the corresponding period in fiscal 2025, an increase of 22.1%. The primary reason for the increase was the inclusion of Omars sales for the full second quarter of 2026 which totaled $8.6 million. Cost of Operations Cost of operations includes the direct cost of manufacturing, including direct materials, labor and related factory overhead, physical inventory adjustments, as well as inbound and outbound freight. Cost of operations for the three months ended June 30, 2026 was $204.1 million compared to $179.4 million for the corresponding period in fiscal 2025, an increase of 13.7%. The increase in cost of operations was consistent with the increase in sales. ​ 22 | Q2 FY 2026 FORM 10-Q ​ ​ Table of Contents ​ ​ MD&A ​ ​ Gross Profit Gross profit is equal to net sales less cost of operations. Gross profit for the three months ended June 30, 2026 was $35.9 million compared to $34.6 million for the corresponding period in fiscal 2025, an increase of 3.9%. This increase was primarily due to the increase in sales. As a percentage of sales, gross profit was 15.0% for the three months ended June 30, 2026, compared to 16.2% in the corresponding period in fiscal 2025, a decrease of 7.3%, primarily as a result of increased chassis deliveries and continued impact of Section 232 tariffs imposed on imported specialty steel and aluminum. Selling, General and Administrative Selling, general and administrative expenses for the three months ended June 30, 2026 were $25.2 million compared to $23.4 million for the corresponding period in fiscal 2025, an increase of 7.6%. While the Company was successful in reducing the historical expense base, the reduction was offset by the inclusion of Omars for the second quarter of 2026. In addition to the recurring expense for Omars, the current quarter also includes $0.5 of amortization expense related to intangible assets that were recognized on the preliminary opening balance. As a percentage of net sales, selling, general and administrative expenses decreased to 10.5% for the three months ended June 30, 2026, from 10.9% for the comparable period in fiscal 2025. Interest Expense, Net Interest expense, net for the three months ended June 30, 2026 was $0.4 million compared to $0.3 million for the corresponding period in fiscal 2025, an increase of 19.7%. Interest expense for the three months ended June 30, 2026 was $0.9 million and $2.1 million for the comparable period in 2025, offset by interest income of $0.6 million for the three months ended June 30, 2026, compared to interest income of $1.8 million for the comparable period in 2025. Other (Income) Expense The Company is exposed to foreign currency transaction risks when the Company has transactions that are denominated in a currency other than its functional currency. When the related balance sheet items are remeasured in the functional currency of the Company, gains and losses are recorded through other (income) expense. Other (income) expense, net is composed primarily of these foreign currency exchange gains and losses. The Company experienced a net foreign currency exchange loss of $0.2 million and gain of $0.5 million for the three months ended June 30, 2026 and 2025, respectively. Provision for Income Taxes The provision for income taxes for the three months ended June 30, 2026 and 2025 reflects a combined federal, state, and foreign tax rate of 27.8% and 25.6%, respectively. The increase was primarily due to the reversal of Omars fair-value adjustments and amortization of intangible assets that were recognized as part of the acquisition accounting. These expenses may or may not be deductible under Italian tax law, which is reflected in the related tax benefit recognized for these expenses. The tax provision will be revised when the final valuation is completed, and definitive tax treatment of these expenses is determined. Adjustments to tax expense will be recognized in current period earnings. The remaining differences between the federal statutory tax rate and the effective tax rate consist primarily of non-deductible executive compensation, state taxes, domestic tax credits, and tax differences on other foreign earnings. ​ ​ 23 ​ Table of Contents ​ ​ MD&A ​ ​ Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ ​ ​ June 30 ​ ​ (in thousands) ​ 2026 ​ ​ ​ 2025 ​ ​ ​ Change NET SALES ​ $ 420,855 ​ $ 439,682 ​ (4.3)% COST OF OPERATIONS ​ ​ 359,238 ​ ​ 371,153 ​ (3.2)% GROSS PROFIT ​ ​ 61,617 ​ ​ 68,529 ​ (10.1)% OPERATING EXPENSES: ​ ​ ​ ​ ​ ​ ​ ​ Selling, general and administrative ​ ​ 49,125 ​ ​ 46,664 ​ 5.3% NON-OPERATING (INCOME) EXPENSES: ​ ​ ​ ​ ​ ​ ​ ​ Interest expense, net ​ ​ 498 ​ ​ 389 ​ 27.9% Other (income) expense, net ​ ​ 324 ​ ​ (682) ​ 147.5% Total expenses, net ​ ​ 49,947 ​ ​ 46,371 ​ 7.7% INCOME BEFORE INCOME TAXES ​ ​ 11,670 ​ ​ 22,158 ​ (47.3)% INCOME TAX PROVISION ​ ​ 3,848 ​ ​ 5,635 ​ (31.7)% NET INCOME ​ $ 7,822 ​ $ 16,523 ​ (52.7)% Net Sales Net sales for the six months ended June 30, 2026 were $420.9 million compared to $439.7 million for the corresponding period in fiscal 2025, a decrease of 4.3%. The decrease in net sales was primarily due to lower domestic production levels, offset by the inclusion of Omars and increased chassis deliveries. Net foreign sales for the six months ended June 30, 2026 were $95.7 million compared to $77.4 million for the corresponding period in fiscal 2025, an increase of 23.6%. The primary reason for the increase was the inclusion of Omars sales for the first half of 2026 which totaled $16.2 million. Cost of Operations Cost of operations includes the direct cost of manufacturing, including direct materials, labor and related factory overhead, physical inventory adjustments, as well as inbound and outbound freight. Cost of operations for the six months ended June 30, 2026 was $359.2 million compared to $371.2 million for the corresponding period in fiscal 2025, a decrease of 3.2%. The decrease in cost of operations was consistent with the decrease in sales. Gross Profit Gross profit is equal to net sales less cost of operations. Gross profit for the six months ended June 30, 2026 was $61.6 million compared to $68.5 million for the corresponding period in fiscal 2025, a decrease of 10.1%. This decrease was primarily due to the decrease in sales. As a percentage of sales, gross profit was 14.6% for the six months ended June 30, 2026, compared to 15.6% in the corresponding period in fiscal 2025, a decrease of 6.1%, primarily as a result of increased chassis deliveries and continued impact of Section 232 tariffs imposed on imported specialty steel and aluminum. Selling, General and Administrative Selling, general and administrative expenses for the six months ended June 30, 2026 were $49.1 million compared to $46.7 million for the corresponding period in fiscal 2025, an increase of 5.3%. While the Company was successful in reducing the historical expense base, the reduction was offset by the inclusion of Omars for the first half of 2026. In addition to the recurring expense for Omars, the current year also includes $1.1 of amortization expense related to intangible assets that were recognized on the preliminary opening balance. As a percentage of net sales, selling, general and administrative expenses increased to 11.7% for the six months ended June 30, 2026, from 10.6% for the comparable period in fiscal 2025. Interest Expense, Net Interest expense, net for the six months ended June 30, 2026 was $0.5 million compared to $0.4 million for the corresponding period in fiscal 2025, an increase of 27.9%. Interest expense for the six months ended June 30, 2026 was $1.8 million and $4.5 million for the comparable period in 2025, offset by interest income of $1.3 million for the six months ended June 30, 2026, compared to interest income of $4.1 million for the comparable period in 2025. ​ 24 | Q2 FY 2026 FORM 10-Q ​ ​ Table of Contents ​ ​ MD&A ​ ​ Other (Income) Expense The Company is exposed to foreign currency transaction risks when the Company has transactions that are denominated in a currency other than its functional currency. When the related balance sheet items are remeasured in the functional currency of the Company, gains and losses are recorded through other (income) expense. Other (income) expense, net is composed primarily of these foreign currency exchange gains and losses. The Company experienced a net foreign currency exchange loss of $0.3 million and gain of $0.7 million for the six months ended June 30, 2026 and 2025, respectively. Provision for Income Taxes The provision for income taxes for the six months ended June 30, 2026 and 2025 reflects a combined federal, state, and foreign tax rate of 33.0% and 25.4%, respectively. The increase was primarily due to the reversal of Omars fair-value adjustments and amortization of intangible assets that were recognized as part of the acquisition accounting. These expenses may or may not be deductible under Italian tax law, so a conservative tax benefit was recognized for these expenses. The tax provision will be revised when the final valuation is completed, and definitive tax treatment of these expenses is determined. Adjustments to tax expense will be recognized in current period earnings. The remaining differences between the federal statutory tax rate and the effective tax rate consist primarily of non-deductible executive compensation, state taxes, domestic tax credits, and tax differences on other foreign earnings. ​ LIQUIDITY AND CAPITAL RESOURCES We currently believe that, based on available capital resources and projected operating cash flows, we have adequate capital resources to fund our operations and expected future cash needs over the next 12 months. However, our ability to satisfy our cash needs will substantially depend upon a number of factors, including our future operating performance, and the economic, regulatory, and other factors discussed elsewhere in this Quarterly Report, many of which are beyond our control. Cash and Cash Equivalents As of June 30, 2026, we had cash and cash equivalents of $55.6 million, and $100.0 million in availability for borrowing under our credit facility. Our primary cash requirements include working capital, capital expenditures, the funding of any declared cash dividends, purchases pursuant to our stock repurchase program, and principal and interest payments on indebtedness. The cash and cash equivalents balance as of June 30, 2026 included $34.9 million of cash held by subsidiaries outside of the United States. Cash Flows The following table summarizes our cash flows for the period: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ ​ ​ June 30 ​ ​ ​ (in thousands) 2026 ​ 2025 ​ Change Operating activities $ 62,980 ​ $ 29,956 ​ 110.2 % Investing activities ​ (12,110) ​ ​ (6,804) ​ (78.0) % Financing activities ​ (39,430) ​ ​ (17,184) ​ (129.5) % Effect of exchange rate changes on cash and cash equivalents (487) ​ ​ 1,516 ​ (132.1) % Net increase (decrease) in cash and cash equivalents $ 10,953 ​ $ 7,484 ​ 46.4 % Changes in working capital, which impact operating cash flows, can vary significantly depending on factors such as the timing of customer payments, inventory purchases and payments to vendors, and tax payments in the regular course of business. Cash Flows Provided by (Used in) Operating Activities During the six months ended June 30, 2026, net cash provided by operating activities was $63.0 million compared to net cash provided by operating activities of $30.0 million in the comparable period in fiscal 2025. Cash provided by operating activities is generally attributable to the receipt of payments from our customers as settlement of their contractual obligation, once we have fulfilled all performance obligations related to our contracts with them. These cash receipts are netted with payments for purchases of inventory, payments for materials used in manufacturing, and other payments that are necessary in the ordinary course of our operations, such as those for utilities and taxes. The cash provided by operating activities was primarily driven by decreases in inventory, as well as increases in accounts payable, offset by increases in accounts receivable, resulting in net positive change in working capital and signifying further stabilization of changes in assets and liabilities as a result of continued supply chain recovery and distributor inventory reductions. ​ ​ 25 ​ Table of Contents ​ ​ MD&A ​ ​ Cash Flows Provided by (Used in) Investing Activities During the six months ended June 30, 2026, cash used in investing activities was $12.1 million compared to cash used in investing activities of $6.8 million for the comparable period in fiscal 2025. The cash used in investing activities was primarily for purchases of property, plant and equipment, as well as our continued investment in manufacturing automation enterprise resource planning (ERP) system enhancements, and the initial phase of our expansions in Tennessee and France. Cash Flows Provided by (Used in) Financing Activities During the six months ended June 30, 2026, cash used in financing activities was $39.4 million compared to cash used in financing activities of $17.2 million for the comparable period in fiscal 2025. The cash used in financing activities was primarily due to payments on the credit facility, repurchases of common stock, and cash payments for dividends. Contractual Obligations As of June 30, 2026 and December 31, 2025, we had commitments of approximately $14.0 million and $15.5 million, respectively, for the acquisition of property, plant and equipment. This decrease in commitments for acquisition of property, plant and equipment was primarily due to progress payments made during the quarter on our continued investments in automation and the use of robotics in our production processes to streamline efficiency and expand our manufacturing facilities. There have been no other material changes to our contractual obligations from what was previously disclosed in our 2025 Form 10-K. Credit Facility The Company had no outstanding borrowings under the credit facility as of June 30, 2026 and $30.0 million as of December 31, 2025. See the disclosure under the heading “Credit Facility” in Note 5 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for additional information regarding the Company’s credit facility. As of July 31, 2026, we had no outstanding balance on our credit facility. Other Long-Term Obligations Prior to applying a discount rate to our lease liabilities, we had approximately $2.9 million and $0.3 million in non-cancellable operating lease obligations as of June 30, 2026 and December 31, 2025, respectively. We had no non-cancellable finance lease obligations as of June 30, 2026 and December 31, 2025. Capital Expenditures Capital expenditures during the six months ended June 30, 2026 and 2025 were $12.1 million and $6.8 million, respectively. We make ongoing capital investments in our property, plant and equipment to increase our production capacity and efficiencies, as well as the sustainability and safety of our operations. This includes capital investments during the six months ended June 30, 2026 in the use of robotics and automation in our production processes to streamline efficiency. In March 2025, our Board of Directors authorized approximately $9.1 million (€8.0 million) for an expansion at one of our facilities in France. During the second half of 2025, work was performed to prepare the site and finalize the design. Construction for this project began in the second quarter of 2026. In March 2026, our Board of Directors authorized a plant expansion at our Ooltewah, TN facility, which we expect will improve our flexibility and enhance production capacity. We anticipate the cost of this project to be approximately $100.0 million. The site preparation for this project began in the second quarter of 2026, and construction of the building is expected to begin in early 2027. ​ ​ ​ 26 | Q2 FY 2026 FORM 10-Q ​ ​ Table of Contents ​ ​ OTHER KEY INFORMATION ​ ​