Balchem BCPC Form 10-Q filing Q1 FY2026

Page No.

PART I FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

Condensed Consolidated Balance Sheets as ofMarch31, 2026and December 31,2025 3

Condensed Consolidated Statements of Earnings for the ThreeMonths EndedMarch31, 2026and 2025 4

Condensed Consolidated Statements of Comprehensive Income for the ThreeMonths EndedMarch31, 2026#if02ab20e6af041c4af686428a95fcc97_22and 2025 5

Condensed Consolidated Statements of Changes in Stockholders' Equity for the ThreeMonths EndedMarch31, 2026#if02ab20e6af041c4af686428a95fcc97_25and 2025 6

Condensed Consolidated Statements of Cash Flows for theThreeMonths EndedMarch31, 2026and 2025 7

Notes to Condensed Consolidated Financial Statements 8

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 23

Item 3. Quantitative and Qualitative Disclosures About Market Risk 29

Item 4. Controls and Procedures 29

PART II OTHER INFORMATION

Item 1. Legal Proceedings 29

Item 1A. Risk Factors 30

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 30

Item 5. Other Information 31

Item 6. Exhibits 32

SIGNATURE PAGE 33

Part I. Financial Information

Item 1. Financial Statements (unaudited)

Item 1. Financial Statements

See accompanying notes to condensed consolidated financial statements.

See accompanying notes to condensed consolidated financial statements.

See accompanying notes to condensed consolidated financial statements.

BALCHEM CORPORATION

Condensed Consolidated Statements of Changes in Stockholders’ Equity

For the Three Months Ended March 31, 2026 and 2025

(Dollars in thousands, except share and per share data)

(Unaudited)

See accompanying notes to condensed consolidated financial statements.

See accompanying notes to condensed consolidated financial statements.

BALCHEM CORPORATION

Notes to Condensed Consolidated Financial Statements (Unaudited)

(All dollar amounts in thousands, except share and per share data)

NOTE 1 – CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The condensed consolidated financial statements presented herein have been prepared in accordance with the accounting policies described in the December 31, 2025 consolidated financial statements, and should be read in conjunction with the consolidated financial statements and notes, which appear in the Annual Report on Form 10-K for the year ended December 31, 2025. The condensed consolidated financial statements reflect the operations of Balchem Corporation and its subsidiaries (the "Company" or "Balchem"). All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, the unaudited condensed consolidated financial statements furnished in this Form 10-Q include all adjustments necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. All such adjustments are of a normal, recurring nature. The condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP” or “GAAP”) governing interim financial statements and the instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934 (the "Exchange Act") and therefore do not include some information and notes necessary to conform to annual reporting requirements. The results of operations for the three months ended March 31, 2026 are not necessarily indicative of the operating results expected for the full year or any interim period.

Certain reclassifications have been made to prior period amounts to conform with the current period's presentation.

Recent Accounting Pronouncements

Recently Issued Accounting Standards

In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2024-03, "Income Statement - Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40)." The new guidance is intended to enhance transparency and disclosures by requiring public entities to provide disaggregated disclosures of certain categories of expenses on an annual and interim basis. The ASU is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact that the adoption of ASU 2024-03 will have on the consolidated financial statements and related disclosures.

NOTE 2 - STOCKHOLDERS' EQUITY

Stock-Based Compensation

The Company’s results for the three months ended March 31, 2026 and 2025 reflected the following stock-based compensation cost, and such compensation cost had the following effects on net earnings:

The Company's omnibus incentive plan ("the Plan") allows for the granting of stock awards and options to purchase common stock. Both incentive stock options and nonqualified stock options can be awarded under the plan. The Company has approved and reserved a number of shares to be issued upon exercise of the outstanding options that is adequate to cover all exercises. As of March 31, 2026, the Plan had 503,567 shares available for future awards.

Option activity for the three months ended March 31, 2026 and 2025 is summarized below:

ASC 718, "Compensation-Stock Compensation", requires companies to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The weighted average fair values of the stock options granted under the Plan were calculated using either the Black-Scholes model or the Binomial model, whichever was deemed to be most appropriate. For the three months ended March 31, 2026, the fair value of each option grant was estimated on the date of the grant using the following weighted average assumptions:

Other information pertaining to option activity during the three months ended March 31, 2026 and 2025 is as follows:

Non-vested restricted stock activity for the three months ended March 31, 2026 and 2025 is summarized below:

Non-vested performance share activity for the three months ended March 31, 2026 and 2025 is summarized below:

The Company also has performance share (“PS”) awards, which provide the recipients the right to receive a certain number of shares of the Common Stock in the future, subject to certain performance hurdles, depending on the date of the grant: (1) an EBITDA performance hurdle, where vesting is dependent upon the Company achieving a certain EBITDA percentage growth over the performance period (typically three years), (2) a relative total shareholder return (“TSR”) market condition where vesting is dependent upon the Company’s TSR performance over the performance period (typically three years) relative to a comparator group consisting of the Russell 2000 index constituents, or (3) an EBITDA performance hurdle, where vesting is dependent upon the Company achieving a certain EBITDA percentage growth over the performance period (typically three years) and modified based on the Company's TSR performance over the performance period relative to a comparator group consisting of the Russell 2000 index constituents. Expense is measured based on the fair value of the grant at the date of grant. A Monte-Carlo simulation has been used to estimate the fair value using the following assumptions:

As of March 31, 2026 and 2025, there were $35,802 and $31,427, respectively, of total unrecognized compensation costs related to non-vested share-based compensation arrangements granted under the plans. As of March 31, 2026, the unrecognized compensation cost is expected to be recognized over a weighted-average period of approximately 1.8 years. The Company estimates that share-based compensation expense for the year ended December 31, 2026 will be $19,467.

Repurchases of Common Stock

On December 9, 2025, the Company's Board of Directors approved a new stock repurchase program (the "December 2025 program"), which replaced the previously approved June 1999 program. The December 2025 program authorizes the repurchases of up to and including 4,000,000 shares of the Company's ordinary shares. This new stock repurchase program has no expiration date, does not oblige the Company to acquire any particular amount of the Company's ordinary shares, and may be terminated at any time. Since the inception of the December 2025 program, a total of 159,539 shares have been repurchased.

During the three months ended March 31, 2026 and 2025, the Company purchased 89,880 and 32,869 shares, respectively, from open market purchases and from employees on a net-settlement basis to provide cash to employees to cover the associated employee payroll taxes. These shares were purchased at an average cost of $166.03 and $161.99 per share, respectively. The Company records the applicable excise taxes payable related to repurchases of our common stock as an incremental cost of the shares repurchased and a corresponding liability for the excise tax payable in "Other accrued liabilities" on our condensed consolidated balance sheet. The excise tax payable was $779 as of December 31, 2025. There was no excise tax payable as of March 31, 2026.

NOTE 3 – INVENTORIES

Inventories, net of reserves at March 31, 2026 and December 31, 2025 consisted of the following:

On a regular basis, the Company evaluates its inventory balances for excess quantities and obsolescence by analyzing demand, inventory on hand, sales levels and other information. Based on these evaluations, inventory balances are reserved, if necessary. The reserve for inventory was $3,537 and $3,414 at March 31, 2026 and December 31, 2025, respectively.

NOTE 4 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment at March 31, 2026 and December 31, 2025 are summarized as follows:

NOTE 5 - INTANGIBLE ASSETS

The Company had goodwill in the amount of $811,452 and $816,375 as of March 31, 2026 and December 31, 2025, respectively, subject to the provisions of ASC 350, “Intangibles-Goodwill and Other.” The decrease in goodwill is due to foreign currency translation adjustments.

Identifiable intangible assets with finite lives at March 31, 2026 and December 31, 2025 are summarized as follows:

Amortization of identifiable intangible assets was $4,399 and $4,060 for the three months ended March 31, 2026 and 2025, respectively. Assuming no change in the gross carrying value of identifiable intangible assets, estimated amortization expense is $12,943 for the remainder of 2026, $16,623 for 2027, $16,175 for 2028, $15,761 for 2029, $15,376 for 2030 and $15,258 for 2031. At March 31, 2026 and December 31, 2025, there were no identifiable intangible assets with indefinite useful lives as defined by ASC 350. Identifiable intangible assets are reflected in "Customer relationships and lists, net" and “Other intangible assets with finite lives, net” on the Company’s condensed consolidated balance sheets. There were no changes to the useful lives of intangible assets subject to amortization during the three months ended March 31, 2026 and 2025.

NOTE 6 - EQUITY METHOD INVESTMENT

In January 2014, BCP Ingredients, Inc. ("BCP"), a subsidiary of the Company, and Taminco US Inc. (note: Taminco was subsequently acquired by Eastman Chemical Company) formed a joint venture (66.66% / 33.34% ownership), St. Gabriel CC Company, LLC, to design, develop, and construct an expansion of BCP’s St. Gabriel aqueous choline chloride plant. BCP contributed the St. Gabriel plant, at cost, and all continued expansion and improvements are funded by the owners. The joint venture became operational as of July 1, 2016, at which point, Taminco US Inc. was succeeded by Taminco US LLC. St. Gabriel CC Company, LLC is a Variable Interest Entity (VIE) because the total equity at risk is not sufficient to permit the joint venture to finance its own activities without additional subordinated financial support. Additionally, voting rights (2 votes each) are not proportionate to the owners’ obligation to absorb expected losses or receive the expected residual returns of the joint venture. BCP receives the majority of the production offtake capacity, which may be adjusted from time to time to the extent the owners agree as such, and absorbs operating expenses approximately proportional to the actual percentage of offtake. The joint venture is accounted for under the equity method of accounting since BCP is not the primary beneficiary as BCP does not have the power to direct the activities of the joint venture that most significantly impact its economic performance. BCP recognized a loss of $124 and $122 for the three months ended March 31, 2026 and 2025, respectively, relating to its portion of the joint venture's expenses in other expense. BCP made capital contributions to the investment totaling $42 and $30 for the three months ended March 31, 2026 and 2025, respectively. The carrying value of the joint venture at March 31, 2026 and December 31, 2025 was $3,635 and $3,717, respectively, and is recorded in "Other non-current assets" on the condensed consolidated balance sheets.

NOTE 7 – REVOLVING LOAN

On July 27, 2022, the Company entered into an Amended and Restated Credit Agreement (the "2022 Credit Agreement") with certain lenders in the form of a senior secured revolving credit facility, due on July 27, 2027. The 2022 Credit Agreement allows for up to $550,000 of borrowing. The loans may be used for working capital, letters of credit, and other corporate purposes and may be drawn upon at the Company’s discretion. As of March 31, 2026 and December 31, 2025, the total balance outstanding on the 2022 Credit Agreement amounted to $169,000 and $164,000, respectively. There are no installment payments required on the revolving loans; they may be voluntarily prepaid in whole or in part without premium or penalty, and all outstanding amounts are due on the maturity date.

Amounts outstanding under the 2022 Credit Agreement are subject to an interest rate equal to a fluctuating rate as defined by the 2022 Credit Agreement plus an applicable rate. The applicable rate is based upon the Company’s consolidated net leverage ratio, as defined in the 2022 Credit Agreement, and the interest rate was 4.78% at March 31, 2026. The Company is also required to pay a commitment fee on the unused portion of the revolving loan, which is based on the Company’s consolidated net leverage ratio as defined in the 2022 Credit Agreement and ranges from 0.150% to 0.225% (0.150% at March 31, 2026). The unused portion of the revolving loan amounted to $381,000 at March 31, 2026. The Company is also required to pay, as applicable, letter of credit fees, administrative agent fees, and other fees to the arrangers and lenders.

Costs associated with the issuance of the revolving loans are capitalized and amortized on a straight-line basis over the term of the 2022 Credit Agreement, which is not materially different than the effective interest method. Capitalized costs net of accumulated amortization were $384 and $455 at March 31, 2026 and December 31, 2025, respectively, and are included in "Other non-current assets" on the condensed consolidated balance sheets. Amortization expense pertaining to these costs totaled $71 for both the three months ended March 31, 2026 and 2025 and are included in "Interest expense, net" in the accompanying condensed consolidated statements of earnings.

The 2022 Credit Agreement contains quarterly covenants requiring the consolidated leverage ratio to be less than a certain maximum ratio and the consolidated interest coverage ratio to exceed a certain minimum ratio. At March 31, 2026, the Company was in compliance with these covenants. Indebtedness under the Company’s loan agreements is secured by assets of the Company.

NOTE 8– NET EARNINGS PER SHARE

The following presents a reconciliation of the net earnings and shares used in calculating basic and diluted net earnings per share:

The number of anti-dilutive shares were 214,602 and 223,820 for the three months ended March 31, 2026 and 2025, respectively. Anti-dilutive shares could potentially dilute basic earnings per share in future periods and therefore, were not included in diluted earnings per share.

NOTE 9 – INCOME TAXES

The Company’s effective tax rate for the three months ended March 31, 2026 and 2025, was 23.3% and 22.7%, respectively. The higher effective tax rate for the quarter was primarily due to an increase in certain state taxes.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law in the United States which includes a broad range of tax provision. The Company has assessed that the OBBBA will not have a material impact on its estimated annual effective tax rate in 2026.

The Company files income tax returns in the U.S. and in various states and foreign countries. As of March 31, 2026, in the major jurisdictions where the Company operates, it is generally no longer subject to income tax examinations by tax authorities for years before 2021. The Company had $6,838 and $6,731 of unrecognized tax benefits, which are included in "Other long-term obligations" on the Company’s condensed consolidated balance sheets, as of March 31, 2026 and December 31, 2025, respectively. The Company includes interest expense or income as well as potential penalties on uncertain tax positions as a component of "Income tax expense" in the condensed consolidated statements of earnings. Total accrued interest and penalties related to uncertain tax positions at March 31, 2026 and December 31, 2025 were $2,457 and $2,350, respectively, and are included in "Other long-term obligations" on the Company’s condensed consolidated balance sheets.

The European Union ("EU") member states formally adopted the EU's Pillar Two Directive on December 15, 2022, which was established by the Organization for Economic Co-operation and Development. Pillar Two generally provides for a 15 percent minimum effective tax rate for the jurisdictions where multinational enterprises operate. While the Company does not anticipate that this will have a material impact on its tax provision or effective tax rate, the Company continues to monitor evolving tax legislation in the jurisdictions in which it operates.

NOTE 10 – SEGMENT INFORMATION

Balchem Corporation reports three reportable segments: Human Nutrition and Health, Animal Nutrition and Health, and Specialty Products. Sales and production of products outside of our reportable segments and other minor business activities are included in "Other and Unallocated".

The Company's Chief Operating Decision Maker ("CODM") is the Chief Executive Officer. The CODM receives a profit and loss reporting package which provides segment information including revenue, cost of goods sold, gross margin, total operating expenses, and earnings from operations. The CODM utilizes this monthly profit and loss reporting package to analyze segment performance and appropriately allocate resources.

Pursuant to ASU 2023-07, "Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures", the significant segment information is summarized as follows:

(11) Other and Unallocated assets consist of certain cash, capitalized loan issuance costs, other assets, investments, and income taxes, which the Company does not allocate to its individual business segments. It also includes assets associated with a few minor businesses which individually do not meet the quantitative thresholds for separate presentation.

NOTE 11 – REVENUE

The following table presents revenues disaggregated by revenue source:

The following table presents revenues disaggregated by geography, based on customers' delivery addresses:

NOTE 12 – SUPPLEMENTAL CASH FLOW INFORMATION

Cash paid during the three months ended March 31, 2026 and 2025 for income taxes and interest is as follows:

NOTE 13 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in accumulated other comprehensive income (loss) were as follows:

Accumulated other comprehensive income (loss) at March 31, 2026 and December 31, 2025 consisted of the following:

NOTE 14 – EMPLOYEE BENEFIT PLANS

Defined Contribution Plans

The Company sponsors one 401(k) savings plan for eligible employees, which allows participants to make pretax or after tax contributions, and the Company matches certain percentages of those contributions with shares of the Company’s Common Stock. The plan also has a discretionary profit sharing portion. All amounts contributed to the plan are deposited into a trust fund administered by independent trustees.

Postretirement Medical Plans

The Company provides postretirement benefits in the form of two unfunded postretirement medical plans; one that is under a collective bargaining agreement and covers eligible retired employees of the Verona facility and one for officers of the Company pursuant to the Balchem Corporation Officer Retiree Program.

Net periodic benefit costs for such retirement medical plans were as follows:

The amounts recorded for these obligations on the Company’s condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025 are $1,112 and $1,122, respectively, and are included in "Other long-term obligations" on the Company's condensed consolidated balance sheets. These plans are unfunded and approved claims are paid from Company funds. Historical cash payments made under such plans have typically been less than $200 per year.

Defined Benefit Pension Plan

On May 27, 2019, the Company acquired Chemogas Holding NV, a privately held specialty gases company headquartered in Grimbergen, Belgium ("Chemogas"), which has an unfunded defined benefit pension plan. The plan provides for the payment of a lump sum at retirement or payments in case of death of the covered employees. The amounts recorded for these obligations on the Company's condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025 were $887 and $869, respectively, and were included in "Other long-term obligations" on the Company's condensed consolidated balance sheets.

Net periodic benefit costs for such benefit pension plan were as follows:

Deferred Compensation Plan

The Company provides an unfunded, nonqualified deferred compensation plan maintained for the benefit of a select group of management or highly compensated employees. Assets of the plan are held in a rabbi trust, and are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company. The Company may, at its discretion, provide matching contributions to eligible employee deferred compensation contributions, with no obligation to make such contributions in future periods. The deferred compensation liability was $13,271 as of March 31, 2026, of which $13,248 was included in "Other long-term obligations" and $23 was included in "Accrued compensation and other benefits" on the Company's condensed consolidated balance sheets. The deferred compensation liability was $12,806 as of December 31, 2025, of which $12,781 was included in "Other long-term obligations" and $25 was included in "Accrued compensation and other benefits" on the Company’s consolidated balance sheets. The related assets of the irrevocable trust funds (also known as "rabbi trust funds") were $13,265 as of March 31, 2026, of which $13,242 was included in "Other non-current assets" and $23 was included in "Other current assets" on the Company's condensed consolidated balance sheet. The rabbi trust funds were $12,798 as of December 31, 2025, of which $12,773 was included in "Other non-current assets" and $25 was included in "Other current assets" on the Company's condensed consolidated balance sheets.

NOTE 15 – COMMITMENTS AND CONTINGENCIES

The Company is obligated to make rental payments under non-cancelable operating and finance leases. Aggregate future minimum rental payments required under these leases at December 31, 2025 are disclosed in Note 18, Leases.

The Company’s Verona, Missouri facility, while held by a prior owner, Syntex Agribusiness, Inc. (“Syntex”), was designated by the U.S. Environmental Protection Agency (the "EPA") as a Superfund site and placed on the National Priorities List in 1983

because of dioxin contamination on portions of the site. Remediation was conducted by Syntex under the oversight of the EPA and the Missouri Department of Natural Resources. The Company is indemnified by the sellers under its May 2001 asset purchase agreement covering its acquisition of the Verona, Missouri facility for potential liabilities associated with the Superfund site. One of the sellers, in turn, has the benefit of certain contractual indemnification by Syntex in relation to the implementation of the above-described Superfund remedy. In June 2023, in response to a Special Notice Letter received from the EPA in 2022, BCP Ingredients, Inc. ("BCP"), the Company's subsidiary that operates the site, Syntex, EPA, and the State of Missouri entered into an Administrative Settlement Agreement and Order on Consent (“ASAOC”) for a focused remedial investigation/feasibility study ("RI/FS") under which (a) BCP will conduct a source investigation of potential source(s) of releases of 1,4-dioxane and chlorobenzene at a portion of the site and (b) BCP and Syntex will complete a RI/FS to determine a potential remedy, if any is required. Activities under the ASAOC are underway and are expected to continue for some period of time.

Separately, in June 2022, the EPA conducted an inspection of BCP’s Verona, Missouri facility (“2022 EPA Inspection”) which was followed by BCP entering into an Administrative Order for Compliance on Consent (“AOC”) with the EPA in relation to its risk management program at the Verona facility. Further, in January 2023, BCP entered into an Amended AOC with the EPA whereby the parties agreed to the extension of certain timelines. BCP timely completed all requirements under the Amended AOC. In November 2023, BCP received a notice from the Environment and Natural Resources Division of the U.S Department of Justice (“DOJ”) primarily related to the 2022 EPA Inspection, which extended the opportunity to discuss alleged violations of Sections 112(r)(7) of the Clean Air Act and regulations in 40 C.F.R. Part 68, commonly known as the Risk Management Plan Rule (“RMP Rule”). BCP participated in such discussions during 2024, and in December 2024, BCP reached a settlement with the EPA and DOJ to resolve these alleged violations. Pursuant to the settlement, which was entered into on January 31, 2025, BCP agreed to: (a) pay a $300 civil penalty; (b) complete a new scrubber system project; and (c) spend $350 to implement projects benefiting the surrounding community, such as emergency equipment for the local fire department and two vehicles to be used as mobile health clinics. The amount associated with this settlement was consistent with the amount previously accrued as a loss contingency. BCP has completed most of its obligations under this settlement and will continue to take steps to timely complete any remaining items.

In addition to the above, from time to time, the Company is a party to various legal proceedings, litigation, claims and assessments. While it is not possible to predict the ultimate disposition of each of these matters, management believes that the ultimate outcome of such matters will not have a material effect on the Company's consolidated financial position, results of operations, liquidity or cash flows.

NOTE 16 – FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company has a number of financial instruments, none of which are held for trading purposes. The Company estimates that the fair value of all financial instruments at March 31, 2026 and December 31, 2025 does not differ materially from the aggregate carrying values of its financial instruments recorded in the accompanying condensed consolidated balance sheets. The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is required in interpreting market data to develop the estimates of fair value, and, accordingly, the estimates are not necessarily indicative of the amounts that the Company could realize in a current market exchange.

The following fair value hierarchy is used to classify assets and liabilities and the table below presents the carrying amounts and the estimated fair values of the Company's financial assets and liabilities measured on a recurring basis as defined by ASC 820, "Fair Value Measurement."

• Level 1 - Inputs are quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.
• Level 2 - Inputs include observable inputs other than quoted prices in active markets.
• Level 3 - Inputs are unobservable inputs for which there is little or no market data available.

The Company’s financial instruments also include accounts receivable, accounts payable, and accrued liabilities, which are carried at cost and approximate fair value due to the short-term maturity of these instruments. The carrying value of debt approximates fair value based upon prices of identical or similar instruments in the marketplace, which are considered Level 2 inputs.

NOTE 17 – RELATED PARTY TRANSACTIONS

The Company provides services under a contractual agreement to St. Gabriel CC Company, LLC. These services include accounting, information technology, quality control, and purchasing services, as well as operation of the St. Gabriel CC Company, LLC plant. The Company also sells raw materials to St. Gabriel CC Company, LLC. These raw materials are used in the production of finished goods that are, in turn, sold by Saint Gabriel CC Company, LLC to the Company for resale to unrelated parties. As such, the sale of these raw materials to St. Gabriel CC Company, LLC in this scenario lacks economic substance and therefore the Company does not include them in net sales within the condensed consolidated statements of earnings.

Payments for the services the Company provided amounted to $1,117 and $1,127 for the three months ended March 31, 2026 and 2025, respectively. The raw materials purchased and subsequently sold amounted to $9,951 and $9,925 for the three months ended March 31, 2026 and 2025, respectively. These services and raw materials are primarily recorded in cost of goods sold, net of the finished goods received from St. Gabriel CC Company, LLC of $8,045 and $7,918 during the three months ended March 31, 2026 and 2025, respectively. At March 31, 2026 and December 31, 2025, the Company had receivables of $4,454 and $4,225, respectively, recorded in accounts receivable from St. Gabriel CC Company, LLC for services rendered and raw materials sold. At March 31, 2026 and December 31, 2025, the Company had payables of $3,420 and $3,369, respectively, recorded in accounts payable for finished goods received from St. Gabriel CC Company, LLC. The Company had payables in the amount of $296 related to non-contractual monies owed to St. Gabriel CC Company, LLC, recorded in accounts payable as of both March 31, 2026 and December 31, 2025. In addition, the Company had receivables in the amount of $150 related to non-contractual monies owed from St. Gabriel CC Company, LLC, recorded in other current assets as of March 31, 2026.

NOTE 18 – LEASES

The Company has both real estate leases and equipment leases. The Company developed four tranches of leases based on lease terms and these tranches reflect the composition of the current lease portfolio. The Company's borrowing history shows that interest rates of a term loan or a line of credit depend on the duration of the loan rather than the nature of the assets purchased by those funds. Based on this understanding, the Company elected to use a portfolio approach to discount rates, applying corporate rates to the tranches of leases based on lease terms. Based on the Company's risk rating, the Company applied the following

discount rates for new leases entered into during the first quarter of 2026: (1) 1-2 years, 5.02% (2) 3-4 years, 5.61% (3) 5-9 years, 5.95% and (4) 10+ years, 6.67%.

Right of use assets and lease liabilities at March 31, 2026 and December 31, 2025 are summarized as follows:

For the three months ended March 31, 2026 and 2025, the Company's total lease costs were as follows, which included amounts recognized in earnings, amounts capitalized on the balance sheets, and the cash flows arising from lease transactions:

Rent expense charged to operations under operating lease agreements for the three months ended March 31, 2026 and 2025 aggregated to $1,302 and $1,325, respectively.

Aggregate future minimum rental payments required under all non-cancelable operating and finance leases at March 31, 2026 are as follows:

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

(All amounts in thousands, except share and per share data)

Recent Developments

Geopolitical Conflicts

We are monitoring the heightened geopolitical tensions in the Middle East, including conflicts involving Iran, which may have certain effects on our business and broader consequences, including increased energy prices, certain raw material costs, increased freight costs, and volatility in shipping patterns. All above impacts may adversely affect the global economy and may have the effect of heightening the operational risks disclosed in the "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2025.

Supreme Court Tariff Ruling

In February 2026, the U.S. Supreme Court issued a ruling striking down certain tariffs previously imposed under the International Emergency Economic Powers Act (“IEEPA”). While the online portal and process to submit IEEPA tariff refund requests became available on April 20, 2026, the availability, timing, and amount of any potential refunds related to these tariffs remain highly uncertain and are subject to ongoing legal, regulatory, and administrative developments. Following the ruling, the U.S. presidential administration imposed additional tariffs under other statutory authorities, resulting in a rapidly evolving tariff environment. At this time, we cannot reasonably estimate the total financial impact of these developments; however, we do not expect them to have a material effect on our future results of operations or cash flows. We will continue to monitor and evaluate new information as it becomes available.

Segment Results

We sell products for all three segments through our own sales force, independent distributors, and sales agents.

The following tables summarize consolidated net sales by segment and business segment earnings from operations for the three months ended March 31, 2026 and 2025:

(1) Other and Unallocated consists of a few minor businesses which individually do not meet the quantitative thresholds for separate presentation and corporate expenses that have not been allocated to a segment. Unallocated corporate expenses consist of transaction and integration costs of $895 and $489 for the three months ended March 31, 2026 and 2025, respectively.

Results of Operations - Three Months Ended March 31, 2026 and 2025

Net Earnings

Net Sales

• The increase in net sales within the Human Nutrition & Health segment for the first quarter of 2026 as compared to the first quarter of 2025 was driven by higher sales within both the nutrients business and the food ingredients and solutions businesses. Total sales for this segment grew 8.3%, with volume and mix contributing 7.1%, the change in foreign currency exchange rates contributing 1.6%, and average selling prices contributing -0.5%.
• The increase in net sales within the Animal Nutrition & Health segment for the first quarter of 2026 compared to the first quarter of 2025 was driven by higher sales in both the monogastric and ruminant species markets. Total sales for this segment increased by 8.6%, with average selling prices contributing 6.5%, the change in foreign currency exchange rates contributing 2.2%, and volume and mix contributing -0.2%.
• The increase in net sales within the Specialty Products segment for the first quarter of 2026 compared to the first quarter of 2025 was due to higher sales in the performance gases business. Total sales for this segment increased by 4.4%, with average selling prices contributing 4.0%, the change in foreign currency exchange rates contributing 3.3%, and volume and mix contributing -2.9%.
• Sales may fluctuate in future periods based on macroeconomic conditions, competitive dynamics, changes in customer preferences, and our ability to successfully introduce new products to the market.

Gross Margin

Gross margin dollars increased in the first quarter of 2026 compared to the first quarter of 2025 due to the sales growth and manufacturing efficiencies, partially offset by raw material inflation.

Operating Expenses

The increase in operating expenses in the first quarter of 2026 compared to the first quarter of 2025 was primarily due to higher compensation-related costs of $4,901 and higher professional services of $1,403.

Earnings from Operations

• Human Nutrition & Health segment earnings from operations increased $2,046 primarily due to a gross margin contribution of $6,782. The increase in gross margin was primarily due to the aforementioned higher sales and a favorable mix, partially offset by certain higher manufacturing input costs. The increase in gross margin was partially offset by an increase in operating expenses of $4,736, primarily due to higher compensation-related costs of $2,281, higher professional services of $561, and higher amortization of $412.
• Animal Nutrition & Health segment earnings from operations increased $456. Gross margin contribution was $2,629, which was driven by the aforementioned higher sales, partially offset by certain higher manufacturing input costs. The increase in gross margin was partially offset by an increase in operating expenses of $2,173, primarily due to higher compensation-related costs of $1,582 and higher professional services of $324.
• Specialty Products segment earnings from operations increased $2,350 primarily due to a gross margin contribution of $3,174. The increase in gross margin was mainly due to the aforementioned higher sales. The increase in gross margin was partially offset by an increase in operating expenses of $824, primarily due to higher compensation-related costs of $928.

Other Expenses

Interest expense for the three months ended March 31, 2026 and 2025 was primarily related to outstanding borrowings under the 2022 Credit Agreement. The decrease in net interest expense is primarily due to lower outstanding borrowings and lower interest rates. The increase in net other expense for the three months ended March 31, 2026 and 2025 was primarily related to foreign currency losses.

Income Tax Expense

The higher effective tax rate was primarily due to an increase in certain state taxes.

Liquidity and Capital Resources

During the three months ended March 31, 2026, there were no material changes outside the ordinary course of business in the specified contractual obligations set forth in our Annual Report on Form 10-K for the year ended December 31, 2025. We expect our operations to continue generating sufficient cash flow to fund working capital requirements and necessary capital investments. We are actively pursuing additional acquisition candidates. We could seek additional bank loans or access to financial markets to fund such acquisitions, our operations, working capital, necessary capital investments or other cash requirements should we deem it necessary to do so.

Cash

Cash and cash equivalents decreased to $72,873 at March 31, 2026 from $74,570 at December 31, 2025. At March 31, 2026, the Company had $66,825 of cash and cash equivalents held by foreign subsidiaries. We intend to permanently reinvest a significant portion of these foreign-held funds in foreign operations by continuing to make additional plant related investments, and potentially invest in partnerships or acquisitions; however, we may also repatriate a portion of cash held by certain foreign subsidiaries to support U.S. liquidity needs and capital allocation priorities. To the extent amounts are repatriated, we could be required to pay applicable withholding taxes on such repatriations. Subsequent to March 31, 2026, we repatriated $23,460 from our Belgium subsidiary to pay down U.S. debt. Working capital was $236,401 at March 31, 2026 as compared to $189,230 at December 31, 2025, an increase of $47,171. Significant cash payments during the three months ended March 31, 2026 included the payment of dividends declared in 2025 of $30,769, repurchases of common stock of $15,690, and capital expenditures and intangible assets acquired of $6,252.

Operating Activities

The increase in cash flows from operating activities was primarily driven by the increases in net earnings, partially offset by the impact from the changes in working capital.

Investing Activities

We continue to invest in corporate projects, improvements across all production facilities, and intangible assets. Total investments in property, plant and equipment and intangible assets were $6,252 and $5,559 for the three months ended March 31, 2026 and 2025, respectively.

Financing Activities

During the three months ended March 31, 2026, we borrowed $52,000 to fund the 2025 dividend, bonus payments, and share repurchases. We made total loan payments of $47,000, resulting in $381,000 available under the 2022 Credit Agreement (see Note 7, Revolving Loan) as of March 31, 2026.

On December 9, 2025, the Company's Board of Directors approved a new stock repurchase program (the "December 2025 program"), which replaced the previously approved June 1999 program. The December 2025 program authorizes the repurchases of up to and including 4,000,000 shares of the Company's ordinary shares. This new stock repurchase program has no expiration date, does not oblige the Company to acquire any particular amount of the Company's ordinary shares, and may be terminated at any time. Since the inception of the December 2025 program, a total of 159,539 shares have been repurchased. We intend to acquire shares from time to time at prevailing market prices if and to the extent we deem it is advisable to do so based on our assessment of corporate cash flow, market conditions and other factors. Open market repurchases of common stock could be made pursuant to a share repurchase agreement in compliance with Rule 10b-18 or a trading plan established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which would permit common stock to be repurchased at a time that we might otherwise be precluded from doing so under insider trading laws or self-imposed trading restrictions. We also repurchase (withhold) shares from employees in connection with the tax settlement of vested shares and/or exercised stock options, as applicable, under the Company's omnibus incentive plan. Such repurchases of shares from employees are funded with existing cash on hand. Repurchases of common stock were $15,690 and $5,325 for the three months ended March 31, 2026 and 2025, respectively.

Proceeds from stock options exercised were $6,727 and $1,668 for the three months ended March 31, 2026 and 2025, respectively. Dividend payments were $30,769 and $28,263 for the three months ended March 31, 2026 and 2025, respectively.

Other Matters Impacting Liquidity

As of March 31, 2026 and December 31, 2025, we have a liability of $6,838 and $6,731, respectively, for uncertain tax positions, including the related interest and penalties, recorded in accordance with ASC 740-10, for which we are unable to reasonably estimate the timing of settlement, if any.

We currently provide postretirement benefits in the form of two retirement medical plans, as discussed in Note 14, Employee Benefit Plans. The liabilities recorded in "Other long-term obligations" on the condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025 were $1,112 and $1,122, respectively, and the plans are not funded. Historical cash payments made under these plans have typically been less than $200 per year. We do not anticipate any changes to the payments made in the current year for the plans.

Chemogas has an unfunded defined benefit plan. The plan provides for the payment of a lump sum at retirement or payments in case of death of the covered employees. The amounts recorded for this obligation on our balance sheets as of March 31, 2026 and December 31, 2025 was $887 and $869, respectively, and was included in "Other long-term obligations" on the condensed consolidated balance sheets.

We provide an unfunded, nonqualified deferred compensation plan maintained for the benefit of a select group of management or highly compensated employees. Assets of the plan are held in a rabbi trust and are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company. The deferred compensation liability was $13,271 as of March 31, 2026, of which $13,248 was included in "Other long-term obligations" and $23 was included in "Accrued compensation and other benefits" on our consolidated balance sheets. The deferred compensation liability was $12,806 as of December 31, 2025, of which $12,781 was included in "Other long-term obligations" and $25 was included in "Accrued compensation and other benefits" on our consolidated balance sheets. The related rabbi trust assets were $13,265 as of March 31, 2026, of which $13,242 was included in "Other non-current assets" and $23 was included in "Other current assets" on the condensed consolidated balance sheets. The rabbi trust assets were $12,798 as of December 31, 2025, of which $12,773 was included in "Other non-current assets" and $25 was included in "Other current assets" on the Company's condensed consolidated balance sheets.

Significant Accounting Policies

There were no changes to our Significant Accounting Policies, as described in our December 31, 2025 Annual Report on Form 10-K, during the three months ended March 31, 2026.

Related Party Transactions

We were engaged in related party transactions with St. Gabriel CC Company, LLC during the three months ended March 31, 2026. Refer to Note 17, Related Party Transactions.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our cash and cash equivalents are held primarily in checking accounts, certificates of deposit, and money market investment funds. Additionally, as of March 31, 2026, our borrowings were under a revolving loan bearing interest at a fluctuating rate as defined by the 2022 Credit Agreement plus an applicable rate (See Note 7, Revolving Loan). The applicable rate is based upon our consolidated net leverage ratio, as defined in the 2022 Credit Agreement. A 100 basis point increase or decrease in interest rates, applied to our borrowings at March 31, 2026, would result in an increase or decrease in annual interest expense and a corresponding reduction or increase in cash flow of approximately $1,690. We are exposed to commodity price risks, including prices of our primary raw materials. Our objective is to seek a reduction in the potential negative earnings impact of raw material pricing arising in our business activities. We manage these financial exposures, where possible, through pricing and operational means. Our practices may change as economic conditions change.

Interest Rate Risk

We have exposure to market risk for changes in interest rates, including the interest rate relating to the 2022 Credit Agreement.

Foreign Currency Exchange Risk

The financial condition and results of operations of our foreign subsidiaries are reported in local currencies and then translated into U.S. dollars at the applicable currency exchange rate for inclusion in our consolidated financial statements. Therefore, we are exposed to foreign currency exchange risk related to these currencies.

Item 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Prior to filing this report, we completed an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rule 13a-15(e) of the Exchange Act as of March 31, 2026. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of March 31, 2026.

(b) Changes in Internal Controls

There have been no changes in the internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Act) during the fiscal quarter ended March 31, 2026, that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

Part II. Other Information

Item 1. Legal Proceedings

In the normal course of business, we are involved in a variety of lawsuits, claims and legal proceedings, from time to time, including commercial and contract disputes, labor and employment matters, product liability claims, environmental liabilities, trade regulation matters, intellectual property disputes and tax-related matters. Further, in connection with normal operations at our plant facilities, our manufacturing sites may, from time to time, be subject to inspections or inquiries by the EPA and other agencies. To the extent any consent orders or other agreements are entered into as a result of findings from such inspections or inquiries, the Company is committed to ensuring compliance with such orders or agreements.

Information with respect to certain legal proceedings is included in Note 15, Commitments and Contingencies, to our consolidated financial statements for the quarter ended March 31, 2026 contained in this Quarterly Report on Form 10-Q, and is incorporated herein by reference.

In our opinion, we do not expect pending legal matters to have a material adverse effect on our consolidated financial position, results of operations, liquidity or cash flows.

Item 1A. Risk Factors

There have been no material changes in the Risk Factors identified in the Company's Annual report on Form 10-K for the year ended December 31, 2025. For a further discussion of our Risk Factors, refer to the "Risk Factors" discussion contained in our Annual Report on Form 10-K for the year ended December 31, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table summarizes the share repurchases activity for the three months ended March 31, 2026:

Item 5. Other Information

No directors or officers adopted, modified or terminated a Rule 10b5-1 trading arrangement during the fiscal quarter ended March 31, 2026.

Item 6. Exhibits

Exhibit Number / Exhibit 10.1 / Exhibit 10.2 / Exhibit 10.3 / Exhibit 31.1 / Exhibit 31.2 / Exhibit 32.1 / Exhibit 32.2 Description / Form of Agreement, Balchem Corporation Restricted Stock Grant Agreement (filed herewith).* / Form of Agreement, Balchem Corporation Performance Share Unit Grant Agreement (filed herewith).* / Form of Agreement, Balchem Corporation Stock Option Grant Agreement (filed herewith).* / Certification of Chief Executive Officer pursuant to Rule 13a-14(a). / Certification of Chief Financial Officer pursuant to Rule 13a-14(a). / Certification of Chief Executive Officer pursuant to Rule 13a-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code. / Certification of Chief Financial Officer pursuant to Rule 13a-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code.

101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document (104) Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | * Compensatory plan or arrangement. | |