The Company’s Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2026 and 2025 reflect the consolidated operations of the Company and its subsidiaries. CECO Environmental Corp. (“CECO,” “we,” “us,” "our," or the “Company”) is a leading environmentally focused, diversified industrial company, serving the broad landscape of industrial air, industrial water and energy transition markets globally providing innovative technology and application expertise through a collection of focused operating companies with niche leadership positions and well-established brands in fragmented markets with flexible business models and established supply chains. CECO helps companies grow their business with safe, clean, and more efficient solutions that help protect people, the environment and industrial equipment. CECO's solutions improve air and water quality, optimize emissions management, and increase the energy and process efficiency for highly engineered applications in power generation, midstream and downstream hydrocarbon processing and transport, chemical processing, electric vehicle production, polysilicon fabrication, semiconductor and electronics production, battery production and recycling, specialty metals, aluminum and steel production, beverage can manufacturing, and industrial and produced water and wastewater treatment, and a wide range of other industrial end markets. On February 23, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Longhorn Merger Sub, Inc. and Longhorn Merger Sub LLC, each a direct wholly owned subsidiary of the Company (together, the “Merger Subs”), and Thermon Group Holdings, Inc. (“Thermon”), pursuant to which the parties agreed to effect the merger transactions contemplated thereby. On June 1, 2026, the Company consummated the previously announced merger with Thermon in accordance with the terms of the Merger Agreement. The cash portion of the merger consideration and related transaction costs were funded with available cash and borrowings under our existing credit facilities. For additional details, see Note 14 to the unaudited condensed consolidated financial statements within Item 1 of this Quarterly Report on Form 10-Q. The acquisition of Thermon significantly impacts the comparability of the Company’s results of operations, financial condition, and cash flows for the three and six months ended June 30, 2026 compared to the corresponding prior-year periods. Market Pressures The senior management team monitors and manages the Company's ability to operate effectively as the result of market pressures. Against the current backdrop of a rapidly evolving global commercial environment, we believe we are comparatively well-positioned as we execute and manufacture a majority of our business in the same regions in which we sell, with our cost and revenue bases largely aligned as a result. Recently, international trade has been impacted by conflict in the Middle East and geopolitical tariff considerations. To mitigate potential impacts from further escalation of conflict in the Middle East, we have implemented contingency planning measures and continue to assess potential effects on our operations, supply chain, and financial results. To mitigate potential tariff-related impacts, we have worked strategically with customers and suppliers to optimize terms and pricing, sourcing locations, and logistics routes and schedules. While we will continue to take a proactive approach on our efforts to mitigate the impacts of these matters, our business and results could be adversely affected by further policy developments. Additionally, we could experience shortages of raw materials and inflationary pressures for certain materials and labor. We have secured raw materials from existing and alternate suppliers and have taken other mitigating actions to mitigate supply disruptions; however, we cannot guarantee that we will be able to continue to do so in the future. If we are unable to continue to mitigate the effects of these supply disruptions and/or inflationary pressures, our business, results and financial condition could be adversely affected. Note Regarding Use of Non-GAAP Financial Measures The Company's unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These GAAP financial statements include certain charges the Company believes are not indicative of its core ongoing operational performance. As a result, the Company provides financial information in this Management’s Discussion and Analysis that was not prepared in accordance with GAAP and should not be considered as an alternative to the information prepared in accordance with GAAP. The Company provides this non-GAAP financial information because the Company’s management utilizes it to evaluate its ongoing financial performance and the Company believes it provides greater transparency to investors as supplemental information to its GAAP results. 24 The Company has provided the non-GAAP financial measures of non-GAAP operating income and non-GAAP operating margin as a result of items that the Company believes are not indicative of its ongoing operations. These include transactions associated with the Company’s acquisitions, divestiture, and the items described below in “Consolidated Results.” The Company believes that these items are not necessarily indicative of the Company’s ongoing operations and their exclusion provides individuals with additional information to better compare the Company's results over multiple periods. The Company utilizes this information to evaluate its ongoing financial performance. The Company has incurred substantial expense and income associated with acquisitions. While the Company cannot predict the exact timing or amounts of such charges, it does expect to treat the financial impact of these transactions as special items in its future presentation of non-GAAP results. 25 Results of Operations Consolidated Results Our Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2026 and 2025 are as follows: Three months ended June 30, Six months ended June 30, (in millions, except ratios) 2026 2025 2026 2025 Net sales $ 285.0 $ 185.4 $ 490.9 $ 362.1 Cost of sales 198.5 118.3 340.5 232.8 Gross profit $ 86.5 $ 67.1 $ 150.4 $ 129.3 Percent of sales 30.3 % 36.2 % 30.6 % 35.7 % Selling and administrative expense 63.9 48.8 110.0 102.4 Percent of sales 22.4 % 26.3 % 22.4 % 28.3 % Amortization expense 7.8 2.9 11.8 6.0 Acquisition and integration expense 45.5 — 55.7 8.2 Gain on sale of Global Pump Solutions business — — — (64.5 ) Other operating expense (income) 2.5 (2.7 ) 4.2 (2.7 ) Operating (loss) income $ (33.2 ) $ 18.1 $ (31.3 ) $ 79.9 Operating margin (11.6 )% 9.7 % (6.4 )% 22.1 % Other expense $ 2.3 $ (1.4 ) $ 3.7 $ (0.9 ) Interest expense 9.1 4.9 13.3 11.1 (Loss) income before income taxes $ (44.6 ) $ 14.6 $ (48.3 ) $ 69.7 Income tax (benefit) expense (10.1 ) 4.5 (13.6 ) 23.2 Net (loss) income $ (34.5 ) $ 10.1 $ (34.7 ) $ 46.5 Noncontrolling interest 0.3 0.6 0.4 1.0 Net (loss) income attributable to CECO Environmental Corp. $ (34.8 ) $ 9.5 $ (35.2 ) $ 45.5 To compare operating performance between the three and six months ended June 30, 2026 and 2025, the Company has adjusted GAAP operating (loss) income to exclude (1) amortization of intangible assets, (2) acquisition and integration expenses, which include legal, accounting, and other expenses, (3) gain on the sale of the Global Pump Solutions business as discussed in Note 15, and (4) other expenses, including restructuring expenses primarily relating to severance, facility exits, and associated legal expenses, asbestos litigation expenses relating to future settlement payments, executive transition expenses, purchase accounting inventory adjustments, and third party professional consulting fees associated with Enterprise Resource Planning system implementations. The following table presents the reconciliation of GAAP operating (loss) income and GAAP operating margin to non-GAAP operating income and non-GAAP operating margin: Three months ended June 30, Six months ended June 30, (in millions, except ratios) 2026 2025 2026 2025 Operating (loss) income as reported in accordance with GAAP $ (33.2 ) $ 18.1 $ (31.3 ) $ 79.9 Operating margin in accordance with GAAP (11.6 )% 9.8 % (6.4 )% 22.1 % Amortization expense 7.8 2.9 11.8 6.0 Acquisition and integration expense 45.5 — 55.7 8.2 Gain on sale of Global Pump Solutions business — — — (64.5 ) Other expense (income)1 12.0 (2.7 ) 13.7 (2.7 ) Non-GAAP operating income $ 32.1 $ 18.3 $ 49.9 $ 26.9 Non-GAAP operating margin 11.3 % 9.9 % 10.2 % 7.4 % (1) includes $9.5 million related to the inventory fair value adjustment for the three and six months ended June 30, 2026. Net sales for the three months ended June 30, 2026 increased $99.6 million, or 53.7%, to $285.0 million compared with $185.4 million for the three months ended June 30, 2025, inclusive of organic growth of 44%. Approximately 82.1% of net sales for the three months ended June 30, 2026 is attributable to organic revenue, which the Company defines as revenue from businesses owned for more than twelve months. The increase in organic revenue is driven by strong order intake in preceding quarters, which contributes to the backlog position. During the quarter, the Company continues to execute customer projects and satisfy contractual commitments 26 without experiencing material delays. The largest contributor to organic revenue growth is demand for products and solutions serving power generation end markets. The remainder of the increase in net sales is attributable to the recent acquisition and integration of Thermon. Net sales for the six months ended June 30, 2026 increased $128.8 million, or 35.6%, to $490.9 million compared with $362.1 million for the six months ended June 30, 2025, inclusive of organic growth of 42%. The increase in organic revenue is driven by significant order intake in the preceding quarters which led to a record backlog position. The Company executed customer projects in accordance with contractual commitments without experiencing material delays. The largest driver of organic revenue is demand for products and solutions supporting power generation end markets. The remainder of the increase in net sales is attributable to the Company’s recent integration of Thermon. Gross profit increased $19.4 million, or 28.9%, to $86.5 million in the three months ended June 30, 2026 compared with $67.1 million in the three months ended June 30, 2025. The increase in gross profit is primarily attributable to the increase in sales volume as described above. Gross profit as a percentage of sales decreased to 30.3% in the three months ended June 30, 2026 compared with 36.2% in the three months ended June 30, 2025. The decrease is primarily attributable to project mix and the timing of project completions within the power generation and industrial solutions end markets. Adjusted gross profit margin was 33.7% for the three months ended June 30, 2026 and excludes acquisition-related costs associated with the Thermon acquisition. Gross profit increased $21.1 million, or 16.3%, to $150.4 million in the six months ended June 30, 2026 compared with $129.3 million in the six months ended June 30, 2025. The increase in gross profit is primarily attributable to the increase in sales volume as described above. Gross profit as a percentage of sales decreased to 30.6% in the six months ended June 30, 2026 and 35.7% in the six months ended June 30, 2025. The decrease is attributable to project mix and the timing of project completions within the power generation and industrial solutions end markets. Adjusted gross profit margin was 32.6% for the six months ended June 30, 2026 and excludes acquisition-related costs associated with the Thermon acquisition. Selling and administrative expenses were $63.9 million for the three months ended June 30, 2026 compared with $48.8 million for the three months ended June 30, 2025. The increase is primarily attributable to selling and administrative expenses associated with the Thermon acquisition. Selling and administrative expenses were $110.0 million for the six months ended June 30, 2026 compared with $102.4 million for the six months ended June 30, 2025. The increase is primarily attributable to selling and administrative expenses associated with the Thermon acquisition, partially offset by lower selling and administrative expenses within the Industrial Process Solutions segment, primarily reflecting the absence of the Global Pump Solutions business following its divestiture on March 31, 2025. Amortization expense was $7.8 million for the three months ended June 30, 2026 compared with $2.9 million for the three months ended June 30, 2025. The increase in expense is attributable to increased intangible assets from current and prior year acquisitions. Amortization expense was $11.8 million for the six months ended June 30, 2026 compared with $6.0 million for the six months ended June 30, 2025. The increase in expense is attributable to increased intangible assets from current and prior year acquisitions. Operating income decreased $51.3 million to $(33.2) million for the three months ended June 30, 2026 compared with operating income of $18.1 million for the three months ended June 30, 2025. The decrease in operating income is primarily attributable to acquisition and integration expenses associated with Thermon. Operating income decreased $111.2 million to $(31.3) million for the six months ended June 30, 2026 compared with operating income of $79.9 million for the six months ended June 30, 2025. The decrease in operating income is primarily attributable to the gain on the sale of the Global Pump Solutions business recognized in the first quarter of 2025 and acquisition and integration expenses associated with Thermon. Non-GAAP operating income was $32.1 million for the three months ended June 30, 2026 compared with $18.3 million for the three months ended June 30, 2025. Non-GAAP operating income as a percentage of sales increased to 11.3% for the three months ended June 30, 2026 from 9.9% for the three months ended June 30, 2025. The increase in non-GAAP operating income is driven by the increase in gross profit, partially offset by the increase in selling and administrative expenses as described above Non-GAAP operating income was $49.9 million for the six months ended June 30, 2026 compared with $26.9 million for the six months ended June 30, 2025. Non-GAAP operating income as a percentage of sales was flat at 10.2% for the both the six months ended June 30, 2026 and 2025. The increase in non-GAAP operating income is driven by the increase in gross profit, partially offset by the increase in selling and administrative expenses as described above. 27 Interest expense increased to $9.1 million in the three months ended June 30, 2026 compared with interest expense of $4.9 million for the three months ended June 30, 2025. The increase in interest expense is primarily due to increased debt balances. Interest expense increased to $13.3 million in the six months ended June 30, 2026 compared with interest expense of $11.1 million for the six months ended June 30, 2025. The increase in interest expense is primarily due to increased debt balances. Income tax benefit was $10.1 million for the three months ended June 30, 2026 compared with income tax expense of $4.5 million for the three months ended June 30, 2025. Income tax expense was $13.6 million for the six months ended June 30, 2026 compared with income tax expense of $23.1 million for the six months ended June 30, 2025. The effective income tax rate for the three months ended June 30, 2026 was 22.6% compared with 30.9% for the three months ended June 30, 2025. The effective income tax rate for the six months ended June 30, 2026 was 28.1% compared with 33.2% for the six months ended June 30, 2025. The effective income tax rates for the three and six months ended June 30, 2026 and June 30, 2025 differ from the United States federal statutory rate. Our effective tax rate is affected by other permanent differences, including the gain on the sale of the Global Pump Solutions business, state income taxes, non-deductible incentive stock-based compensation, and differences in tax rates among the jurisdictions in which we operate. Orders booked increased $524.4 million, or 192%, to $798.5 million during the three months ended June 30, 2026 compared with $274.1 million in the three months ended June 30, 2025, inclusive of organic growth of 185%, as defined as the change in orders excluding the impact of orders recorded in the twelve month period subsequent to acquisition dates. The increase is primarily driven by demand for the Company’s emissions and exhaust systems applications supporting large-scale natural gas power generation projects. Orders booked increased $745.9 million, or 149%, to $1,248.0 million during the six months ended June 30, 2026 compared with $502.1 million in the six months ended June 30, 2025, inclusive of organic growth of 155%. The increase is primarily driven by demand for the Company’s emissions and exhaust system applications supporting large-scale natural gas power generation projects. Business Segments The Company’s operations are organized and reviewed by management along its product lines and end markets that the segment serves and are presented in three reportable segments. The results of the segments are reviewed through segment profit, which represents income from operations as adjusted for certain items. Financial results by segment are as follows: Three months ended June 30, Six months ended June 30, (in thousands) 2026 2025 2026 2025 Net sales Engineered Systems $ 173,673 $ 128,460 $ 324,209 $ 248,893 Thermal Solutions 49,606 - 49,606 - Industrial Process Solutions 61,682 56,931 117,065 113,195 Total net sales $ 284,961 $ 185,391 $ 490,880 $ 362,088 Three months ended June 30, Six months ended June 30, (in thousands) 2026 2025 2026 2025 Segment profit Engineered Systems $ 36,000 $ 26,639 $ 65,822 $ 49,472 Thermal Solutions 1,512 - 1,512 - Industrial Process Solutions 8,910 10,686 15,356 81,241 Total segment profit $ 46,423 $ 37,325 $ 82,690 $ 130,713 (1) Includes corporate compensation, professional services, information technology, and other general and administrative corporate expenses. Engineered Systems Segment Our Engineered Systems segment net sales increased $45.2 million to $173.7 million for the three months ended June 30, 2026 compared with $128.5 million for the three months ended June 30, 2025, inclusive of organic growth of 54.3%. The increase is led by backlog execution on large scale natural gas power generation projects. 28 Our Engineered Systems segment net sales increased $75.3 million to $324.2 million for the six months ended June 30, 2026 compared with $248.9 million for the six months ended June 30, 2025, inclusive of organic growth of 48%. The increase is led by backlog execution on large scale natural gas power generation projects. Segment profit for the Engineered Systems segment increased $9.4 million to $36.0 million for the three months ended June 30, 2026 compared with $26.6 million for the three months ended June 30, 2025. The increase is attributable to higher gross profit related to increased net sales. Segment profit for the Engineered Systems segment increased $16.3 million to $65.8 million for the six months ended June 30, 2026 compared with $49.5 million for the six months ended June 30, 2025. The operating income increase is attributable to higher gross profit related to increased net sales, partially offset by an increase in selling and administrative expense. Our Engineered Systems segment orders booked increased $447.9 million, or 200%, to $672.1 million during the three months ended June 30, 2026 compared with $224.2 million in the three months ended June 30, 2025, inclusive of organic growth of 173.8%. The increase is primarily attributable to the Company's energy and power technologies. Investments in energy infrastructure and growth in midstream and downstream markets have resulted in increased demand for emissions, and acoustics products. Our Engineered Systems segment orders booked increased $668.1 million, or 173%, to $1,055.1 million during the six months ended June 30, 2026 compared with $387.0 million in the six months ended June 30, 2025, inclusive of organic growth of 198.1%. The increase is primarily attributable to the Company's energy and power technologies. Investments in energy infrastructure and growth in midstream and downstream markets have resulted in increased demand for emissions and acoustics products. Industrial Process Solutions Segment Our Industrial Process Solutions segment net sales increased $4.8 million to $61.7 million for the three months ended June 30, 2026 compared with $56.9 million for the three months ended June 30, 2025, inclusive of organic growth of 84%. The increase is primarily attributable to project execution on semiconductor and industrial ducting backlog. Our Industrial Process Solutions segment net sales increased $3.9 million to $117.1 million for the six months ended June 30, 2026 compared with $113.2 million for the six months ended June 30, 2025, inclusive of organic growth of 67%. The increase is primarily attributable to project execution on semiconductor and industrial ducting backlog. Segment profit for the Industrial Process Solutions segment decreased $1.8 million to $8.9 million for the three months ended June 30, 2026 compared with $10.7 million for the three months ended June 30, 2025. The decrease is primarily attributable to project mix. Segment profit for the Industrial Process Solutions segment decreased $65.8 million to $15.4 million for the six months ended June 30, 2026 compared with $81.2 million for the six months ended June 30, 2025. The decrease is primarily attributable to the gain on the sale of the Global Pump Solutions business. Our Industrial Process Solutions segment orders booked increased $40.4 million, or 81%, to $90.3 million during the three months ended June 30, 2026 compared with $49.9 million in the three months ended June 30, 2025, inclusive of organic growth of 157%. The increase is primarily attributable to higher demand for the Company's scrubber technologies in semiconductor and international markets. Our Industrial Process Solutions segment orders booked increased $41.9 million, or 36%, to $156.8 million during the six months ended June 30, 2026 compared with $114.9 million in the six months ended June 30, 2025, inclusive of organic growth of 103.6%. The increase is primarily attributable to the higher demand for the Company's scrubber technologies in semiconductor and international markets. Thermal Solutions Segment The Thermal Solutions segment represents the Thermon business, acquired in June 2026. As such, there is no comparative financial information reflected in the Company's previously filed Quarterly Reports on Form 10-Q. Backlog Backlog (i.e., unfulfilled or remaining performance obligations) represents the sales we expect to recognize for our products and services for which control has not yet transferred to the customer. Backlog increased to $1,819.1 million as of June 30, 2026, from 29 $793.1 million as of December 31, 2025. Thermon contributed $262.0 million to our backlog figure as of June 30, 2026, with the remaining increase primarily attributable to our growing orders. Our customers may have the right to cancel a given order. Historically, cancellations have not been significant. Backlog is adjusted on a quarterly basis for adjustments in foreign currency exchange rates. Substantially all backlog is expected to be delivered within 12 to 24 months, with a majority within 12 months. Backlog is not defined by GAAP and our methodology for calculating backlog may not be consistent with methodologies used by other companies. Recent Accounting Pronouncements For information regarding recent accounting pronouncements, see Note 2 to the unaudited condensed consolidated financial statements within Item 1 of this Quarterly Report on Form 10-Q. Liquidity and Capital Resources When we undertake large jobs, our working capital objective is to make these projects self-funding. We work to achieve this by obtaining customer advanced payments, structuring our contracts with progress billing provisions, when possible, utilizing extended payment terms from material suppliers, and paying sub-contractors after payment from our customers, which is an industry practice. Our investment in working capital is funded by cash flows from operations and by our revolving line of credit under our Credit Facility (as defined below). At June 30, 2026, the Company had working capital of $327.3 million, compared with $104.4 million at December 31, 2025. The ratio of current assets to current liabilities was 1.50 to 1.00 on June 30, 2026, as compared with a ratio of 1.34 to 1.00 on December 31, 2025. At June 30, 2026 and December 31, 2025, cash and cash equivalents totaled $61.1 million and $33.1 million, respectively. As of June 30, 2026 and December 31, 2025, $49.1 million and $26.4 million, respectively, of our cash and cash equivalents were held by certain foreign subsidiaries, as well as being denominated in foreign currencies. Debt consisted of the following: (in thousands) June 30, 2026 December 31, 2025 Outstanding borrowings under Credit Facility (defined below) Revolving credit facility $ 497,000 $ 208,600 Term loan 235,000 — Total outstanding borrowings under the Credit Facility 732,000 208,600 Outstanding borrowings under the joint venture term debt 4,731 5,647 Unamortized debt discount (9,025 ) (1,809 ) Total outstanding borrowings 727,706 212,438 Less: current portion (16,641 ) (1,879 ) Total debt, less current portion $ 711,065 $ 210,559 Credit Facility The Company’s outstanding borrowings in the United States consist of a senior secured revolver loan with sub-facilities for letters of credit, swing-line loans and multi-currency loans (collectively, the “Credit Facility”). As of June 30, 2026 and December 31, 2025, the Company was in compliance with all related financial and other restrictive covenants under the Credit Facility. On January 30, 2026, the Company entered into the Fourth Amended and Restated Credit Agreement, which provided for a senior secured revolving credit facility in an initial aggregate principal amount of up to $700.0 million. On March 30, 2026, the Company entered into Amendment No. 1 to Fourth Amended and Restated Credit Agreement, which provides for a senior secured revolving credit facility in an initial aggregate principal amount of up to $740.0 million, and added an incremental senior secured delayed-draw term loan commitment in an initial aggregate principal amount of $235 million (the “Incremental Term A-1 Loan Facility”), subject only to the satisfaction or waiver of the related conditions precedent set forth in the Credit Agreement. On June 1, 2026, the Company borrowed $235.0 million on the Incremental Term A-1 Loan Facility. See Note 8 to the unaudited condensed consolidated financial statements within Item 1 of this Quarterly Report on Form 10-Q for further information on the Company’s debt facilities. 30 Total unused credit availability under our existing Credit Facility is as follows: (in millions) June 30, 2026 December 31, 2025 Credit Facility, revolving loans $ 740.0 $ 400.0 Draw down (497.0 ) (208.6 ) Letters of credit open (22.5 ) (23.8 ) Total unused credit availability $ 220.5 $ 167.6 Amount available based on borrowing limitations $ 220.5 $ 123.6 The Company's available secured borrowing capacity under the Credit Facility is defined as the lower of (a) the Credit Facility amount less outstanding borrowings and Letters of Credit on the Credit Facility, and (b) the Company's trailing twelve month EBITDA, as defined in the Credit Agreement, by a factor of the maximum leverage ratio, less outstanding borrowings on the Credit Facility. Overview of Cash Flows and Liquidity Six months ended June 30, (in thousands) 2026 2025 Net cash used in operating activities $ (32,426 ) $ (19,363 ) Net cash (used in) provided by investing activities (444,357 ) 3,813 Net cash provided by financing activities 509,050 14,197 Effect of exchange rate changes on cash, cash equivalents and restricted cash (1,645 ) 61 Net increase in cash, cash equivalents and restricted cash $ 30,622 $ (1,292 ) Operating Activities For the six months ended June 30, 2026, $32.4 million of cash was used in operating activities compared with $19.4 million used in operations in the prior year period, representing an decrease of $13.1 million. Cash flows from operating activities in the first six months of 2026 was lower in 2026 primarily due to larger investments in operating assets and liabilities commensurate with growth in the business. Investing Activities For the six months ended June 30, 2026, net cash used in investing activities was $444.4 million compared with $3.8 million provided by investing activities in the prior year period. For the six months ended June 30, 2026, the Company used $329.6 million in the acquisition of Thermon, as well as $6.6 million in the acquisition of Flexible Specialty Products. As part of the Thermon acquisition, the Company repaid approximately $141.7 million of the acquiree's outstanding indebtedness at closing. This cash outlay was partially offset by cash and cash equivalents received from Thermon of $41.5 million. The repayment of debt was treated as a component of the consideration transferred. In the prior year period, the Company received $105.9 million related to the sale of the Global Pump Solutions business as discussed in Note 15, offset by $97.6 million used in the acquisition of Profire as discussed in Note 14. Financing Activities For the six months ended June 30, 2026, $509.0 million was provided by financing activities compared with $14.2 million provided by financing activities in the prior year period, for an increase of $494.9 million. The increase was driven by increased borrowings on the Company's Credit Facility, inclusive of the Incremental Term A-1 Loan Facility, to fund the cash consideration and other closing costs paid in connection with the acquisition of Thermon. Critical Accounting Estimates Management believes there have been no changes during the six months ended June 30, 2026 to the items that the Company disclosed as its critical accounting policies and estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Forward-Looking Statements This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, which are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Any statements contained in this Quarterly Report on Form 10-Q, other than statements of historical fact, including statements about management’s beliefs and 31 expectations or that otherwise address events, or developments that CECO expects, believes, or anticipates will or may occur in the future, are forward-looking statements and should be evaluated as such. These statements are made on the basis of management’s views and assumptions regarding future events and business performance. We use words such as “believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “will,” “plan,” “should” and similar expressions to identify forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, statements regarding: the integration of Thermon Group Holdings, Inc. (“Thermon”), which was acquired by the Company on June 1, 2026; the anticipated benefits and synergies of the Thermon acquisition; descriptions of the combined company and its operations following the acquisition; and anticipated future performance. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Potential risks and uncertainties, among others, that could cause actual results to differ materially are discussed under “Item 1A. Risk Factors” of this Quarterly Report on Form 10-Q and in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and include, but are not limited to: •the ability to successfully integrate the Thermon business with CECO’s existing operations; •risks related to disruption of management time from ongoing business operations due to the integration of Thermon; •the ability of the combined company to retain customers and retain and hire key personnel and maintain relationships with suppliers following the Thermon acquisition, and the effects on the combined company’s operating results and business generally; •the risk that the Thermon integration could distract management and that the Company will incur substantial integration and transaction-related costs; •the risk that problems may arise in successfully integrating the Thermon business, which may result in the combined company not operating as effectively and efficiently as expected; •the risk that the combined company may be unable to achieve the synergies anticipated from the Thermon acquisition or that it may take longer than expected to achieve those synergies; •dependence on fixed price contracts and the risks associated therewith, including actual costs exceeding estimates and method of accounting for revenue; •the effect of growth on our infrastructure, resources and existing sales; •the ability to expand operations in both new and existing markets; •the potential for contract delay or cancellation as a result of on-going or worsening supply chain challenges, or other customer-driven project delays relating to supply chain challenges or other customer considerations, including those related to conflict in the Middle East; •liabilities arising from faulty services or products that could result in significant professional or product liability, warranty or other claims; •changes in or developments with respect to any litigation or investigation; •failure to meet timely completion or performance standards that could result in higher cost and reduced profits or, in some cases, losses on projects; •the potential for fluctuations in prices for manufactured components and raw materials, including as a result of tariffs and surcharges, and rising energy costs; •inflationary pressures relating to rising raw material costs and the cost of labor; •the substantial amount of debt incurred in connection with our strategic transactions and our ability to repay or refinance it or incur additional debt in the future; •the impact of federal, state or local government regulations, including with respect to tax policy; •our ability to repurchase shares of our common stock and the amounts and timing of repurchases; •our ability to successfully realize the expected benefits of our restructuring program; •economic and political conditions generally; •our ability to optimize our business portfolio by identifying acquisition targets, executing upon any strategic acquisitions or divestitures, integrating acquired businesses and realizing the synergies from strategic transactions; 32 •unpredictability and severity of catastrophic events, including cybersecurity threats, acts of terrorism or outbreak of war or hostilities or public health crises, as well as management’s response to any of the aforementioned factors; and •our ability to remediate our material weaknesses, or any other material weakness that we may identify in the future, that could result in material misstatements in our financial statements. Many of these risks are beyond management’s ability to control or predict. Should one or more of these risks or uncertainties materialize, or should any related assumptions prove incorrect, actual results may vary in material aspects from those currently anticipated. Investors are cautioned not to place undue reliance on such forward-looking statements as they speak only to our views as of the date the statement is made. Except as required under the federal securities laws or the rules and regulations of the SEC, we undertake no obligation to update or review any forward-looking statements, whether as a result of new information, future events or otherwise.