Foster (Lb) Co. FSTR Form 10-Q filing Q2 FY2026

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

* Reclassifications out of “Accumulated other comprehensive loss” for pension obligations are charged to “Selling and administrative expenses” within the Condensed Consolidated Statements of Operations.

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands)

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands)

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

L.B. FOSTER COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except share data)

Note 1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. In the opinion of management, all estimates and adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. This Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in L.B. Foster Company’s Annual Report on Form 10-K for the year ended December 31, 2025. In this Quarterly Report on Form 10-Q, references to “we,” “us,” “our,” and the “Company” refer collectively to L.B. Foster Company and its consolidated subsidiaries.

Recently Issued Accounting Standards

In December 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2025-12, Codification Improvements (“ASU 2025-12”), to clarify guidance, correct technical errors, remove outdated language and improve consistency across various topics in the Accounting Standards Codification. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods within those annual periods. Early adoption is permitted. The Company is currently evaluating the impact of adopting this guidance on the consolidated financial statements.

In December 2025, the FASB issued Accounting Standards Update 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”), to clarify the guidance in Topic 270 to improve consistency of interim financial reporting. ASU 2025-11 provides a list of required interim disclosures and established a disclosure principle requiring entities to disclose events since the end of the last annual report period that have a material impact on the entity. The amendments in ASU 2025-11 are effective for fiscal years beginning after December 15, 2027, including interim reporting periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting this guidance on the consolidated financial statements.

In November 2024, the FASB issued Accounting Standards Update 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), which requires entities to provide more detailed disaggregation of expenses in the income statement, focusing on the nature of the expenses rather than their function. The new disclosures will require public business entities to disclose in the notes to the financial statements, at each interim and annual reporting period, specific information about certain costs and expenses, including purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each expense caption presented on the face of the income statement, and the total amount of an entity's selling expenses. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, and may be applied either prospectively or retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of adopting this guidance on the consolidated financial statements.

Note 2. Business Segments

The Company is a global technology solutions provider of engineered, manufactured products and services that builds and supports infrastructure. The Company determines its operating segments based on how the Company's Chief Operating Decision Maker (“CODM”), the Company's President and Chief Executive Officer, manages the businesses, including resource allocation and operating decisions. The Company is organized into two operating segments, which represent the individual businesses that are run separately within this operational structure.

The Company has two reportable segments: Rail, Technologies, and Services (“Rail”), and Infrastructure Solutions (“Infrastructure”). The Company’s segments represent components of the Company (a) that engage in activities from which revenue is generated and expenses are incurred, (b) whose operating results are regularly reviewed by the CODM, who uses such information to make decisions about resources to be allocated to the segments, and (c) for which discrete financial information is available. The CODM uses segment operating income to determine resources to allocate to each segment (including personnel and financial resources) during the annual budgeting process. The CODM evaluates segment performance regularly by comparing the segment operating income to the budgeted measure.

Operating segments are evaluated on their segment operating income contribution to the Company’s consolidated results. The Company considers the aggregation of operating segments into reporting segments based on the nature of offerings, nature of production services, the type or class of customer for products and services, methods used to distribute products and services, and economic and regulatory environment conditions.

Segment operating income includes reportable segment gross profit and direct expenses such as salaries, benefits, restructuring, research and development, professional and purchased services expenditures, amortization expense, bad debt expense, and other segment expenses. Additionally, segment operating income includes allocated corporate operating expenses associated with central services such as quality, logistics, environmental health and safety, information technology, insurance, and human resources. Other corporate functional costs that are associated with the operating segments are also allocated to the segments such as finance, marketing, credit and collections, and treasury functions. Operating expenses related to corporate headquarter functions are allocated to each segment based on segment headcount, revenue contribution, or activity of the business units within the segments, based on the corporate activity type provided to the segment. Management believes the allocation of corporate operating expenses provides an accurate presentation of how the segments utilize corporate support activities. This provides the CODM meaningful segment profitability information to support operating decisions and the allocation of resources.

Certain corporate costs are separately managed on a consolidated basis and are not allocated to the operating segments. These corporate costs include public company costs such as listing fees, audit fees, compliance costs, insurance costs, and Board of Directors fees. Additionally, certain corporate executive management costs, including costs of the corporate executive leadership team, and corporate management stock-based compensation expenses are not allocated to the operating segments. Finally, interest expense, net and certain other items included in “Other income - net”, which are managed on a consolidated basis, are not allocated to the operating segments.

The operating results of the Company’s reportable segments were as follows for the periods presented:

(1) Purchased services costs generally include contractor services, insurance expenditures, rental expense, and legal services.

(2) General administrative costs generally include office supplies, utilities, advertising, bad debt expense, and any restructuring expenditures.

(1) Purchased services costs generally include contractor services, insurance expenditures, rental expense, and legal services.

(2) General administrative costs generally include office supplies, utilities, advertising, bad debt expense, and any restructuring expenditures.

On June 21, 2022, the Company acquired the stock of Skratch Enterprises Ltd. for $7,402, which was inclusive of deferred payments withheld by the Company of $1,228, to be paid over five years or utilized to satisfy post-closing working capital adjustments or indemnity claims under the purchase agreement. During the second quarters of 2026 and 2025, the Company made deferred acquisition payments of $403 and $782, respectively.

Restructuring charges included in segment results are discussed further in Note 13 to the Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q.

Reconciliations of reportable depreciation and amortization and expenditures for long-lived assets to the Company’s consolidated totals are as follows for the periods presented:

The following table summarizes the Company's total assets by reportable segment for the following periods:

Note 3. Revenue

The following table summarizes the Company’s sales by major product and service line for the periods presented:

The majority of the Company’s revenue is from products transferred and services rendered to customers at a point in time. The Company recognizes revenue at the point in time at which the customer obtains control of the product or service, which is generally when the product title passes to the customer upon shipment or the service has been rendered to the customer. In limited cases, title does not transfer and revenue is not recognized until the customer has received the products at a designated physical location.

Net sales by the timing of the transfer of goods and services were as follows for the periods presented:

The Company’s performance obligations under long-term agreements with its customers are generally satisfied over time. Over time revenue is primarily comprised of transit infrastructure and technology services and solutions projects within the Rail segment, precast concrete buildings within the Precast Concrete Products division in the Infrastructure segment, and long-term bridge projects within the Steel Products division in the Infrastructure segment. Revenue under these long-term agreements is generally recognized over time using an input measure based upon the proportion of actual costs incurred to estimated total project costs or an output method, specifically units delivered, based upon certain customer acceptance and delivery requirements. The use of an input or output measure to recognize revenue is determined based on what is most appropriate given the nature of the work performed and terms of the associated agreement.

Accounting for these long-term agreements involves the use of various techniques to estimate total revenues and costs. The Company estimates profit on these long-term agreements as the difference between total estimated revenues and expected costs to complete a contract and recognizes that profit over the life of the contract. Contract estimates are based on various assumptions to project the outcome of future events that may span several years. These assumptions include, among other things, labor productivity, cost and availability of materials, and timing of funding by customers. The nature of these long-term agreements may give rise to several types of variable consideration, such as claims and awards. Contract estimates may include additional revenue for submitted contract modifications, including at times unapproved change orders, if there exists an enforceable right to the modification, the amount can be reasonably estimated, and its realization is probable. These estimates are based on historical collection experience, anticipated performance, and the Company’s best judgment at that time. These amounts are generally included in the contract’s transaction price and are allocated over the remaining performance obligations. As a result of management's reviews of contract-related estimates, the Company makes adjustments to contract estimates that impact our revenue and profit totals. Changes in estimates are primarily attributed to updated considerations, including economic conditions and historic contract patterns, resulting in changes to anticipated revenue from existing contracts. There were no such changes in actual or expected values during the three and six months ended June 30, 2026. During the three and six months ended June 30, 2025, reductions to net sales stemming from changes in actual and expected values of certain commercial contracts and settlements of such contracts were $1,647. The Company’s estimates related to these long-term agreements are further described in “Note 3. Revenue” of the Notes to the Company’s Consolidated Financial Statements contained in its Annual Report on Form 10-K for the year ended December 31, 2025.

Revenue recognized over time was as follows for the periods presented:

The timing of revenue recognition, billings, and cash collections results in billed receivables, costs in excess of billings (included in “Contract assets - net”), and billings in excess of costs (contract liabilities), included in “Deferred revenue” within the Condensed Consolidated Balance Sheets.

The following table sets forth the Company’s contract assets:

The following table sets forth the Company’s contract liabilities:

The Company has established policies regarding allowance for credit losses associated with contract assets, which includes standalone reserve assessments for its long term, complex contracts as needed as well as detailed regular review and updates to contract margins, progress, and value. A standard reserve threshold is applied to contract assets related to short term, less complex contracts. Management also regularly reviews collection patterns and future expected collections and makes necessary revisions to allowance for credit losses related to contract assets.

As of June 30, 2026, the Company had approximately $246,113 of remaining performance obligations, which is also referred to as backlog. Approximately 5.8% of the June 30, 2026 backlog was related to projects that are anticipated to extend beyond June 30, 2027.

Note 4. Goodwill and Other Intangible Assets

The following table presents the changes in goodwill balance by reportable segment for the period presented:

The Company performs goodwill impairment tests annually during the fourth quarter, and also performs interim goodwill impairment tests if it is determined that it is more likely than not that the fair value of a reporting unit is less than the carrying amount. Qualitative factors are assessed to determine whether it is more likely than not that the fair value of a reporting unit is less than the carrying amount, which includes the impacts of current economic conditions, including but not limited to concerns related to inflation, tariffs, labor markets, supply chains, and changes in trade policy. However, these factors can be unpredictable and are subject to change. No interim goodwill impairment test was required as a result of the evaluation of qualitative factors as of June 30, 2026. However, future impairment charges could result if future projections diverge unfavorably from current expectations.

The following table sets forth the components of the Company’s intangible assets for the periods presented:

Note 5. Accounts Receivable

Changes in reserves for uncollectible accounts are recorded as part of “Selling and administrative expenses” in the Condensed Consolidated Statements of Operations and are recorded net of recoveries of previous write-offs. During the three months ended June 30, 2026 and 2025, the Company recorded a net expense of $168 and $327, respectively, and a net expense of $468 and $518 for the six months ended June 30, 2026 and 2025, respectively.

The Company established the allowance for credit losses by calculating the amount to reserve based on the age of a given trade receivable and considering historical collection patterns, bad debt expense experience, expected future trends of collections, current and expected market conditions, and any other relevant subjective adjustments as needed. Management maintains high-quality credit review practices and positive customer relationships that mitigate credit risks. The Company’s reserves are regularly reviewed and revised as necessary.

The following table sets forth the Company’s allowance for credit losses:

Note 6. Inventory

Inventory is valued at average cost or net realizable value, whichever is lower. The Company’s components of inventory are summarized in the following table for the periods presented:

Note 7. Long-Term Debt and Related Matters

Long-term debt consisted of the following:

On June 27, 2025, the Company, its domestic subsidiaries, and certain of its Canadian and United Kingdom subsidiaries (collectively, the “Borrowers”), entered into the Fifth Amended and Restated Credit Agreement (the “Credit Agreement”) with PNC Bank, N.A., Bank of America, N.A., Citizens Bank, N.A., and Wells Fargo Bank N.A. as Co-Syndication Agents, and Dollar Bank, Federal Savings Bank as a participant. The Credit Agreement, which expires on June 27, 2030, provides for a five-year, revolving credit facility that permits aggregate borrowings of the Borrowers up to $150,000 with sublimits for (a) the issuance of letters of credit in dollars and in alternative currencies in an amount not to exceed the dollar equivalent of $30,000, and (b) borrowings of swing loans in dollars in an amount not to exceed $20,000; and with an incremental loan feature not to exceed $60,000.

The Company’s obligations under the Credit Agreement are secured by the grant of a security interest by the Borrowers in substantially all of the assets owned by such entities. Additionally, the equity interests in each of the loan parties, other than the Company, and the equity interests held by each loan party in their subsidiaries, have been pledged to the lenders as collateral for the lending obligations.

Borrowings under the Credit Agreement will bear interest at rates based upon either the base rate or Term SOFR rate plus applicable margins. Applicable margins are dictated by the ratio of the Company’s total net indebtedness to the Company’s consolidated EBITDA for four trailing quarters, as defined in the Credit Agreement. The base rate is the highest of (a) the Overnight Bank Funding Rate plus 0.50%, (b) the Prime Rate, or (c) the Daily Simple SOFR rate plus 1.00% so long as the Daily Simple SOFR rate is offered, ascertainable and not unlawful (each as defined in the Credit Agreement). The base rate and Term SOFR rate spreads range from 0.25% to 1.50% and 1.25% to 2.50%, respectively.

The Credit Agreement includes two financial covenants: (a) Maximum Gross Leverage Ratio, defined as the Company’s Consolidated Indebtedness divided by the Company’s Consolidated EBITDA, which must not exceed (i) 3.50 to 1.00 for all testing periods other than during an Acquisition Period, and (ii) 4.00 to 1.00 for all testing periods occurring during an Acquisition Period, and (b) Minimum Consolidated Fixed Charge Coverage Ratio, defined as the Company’s Consolidated EBITDA divided by the Company’s Fixed Charges, which must be more than 1.10 to 1.00.

As of June 30, 2026, the Company was in compliance with the covenants in the Credit Agreement, as amended, and had outstanding letters of credit of approximately $827.

Note 8. Earnings Per Common Share

(Share amounts in thousands)

The following table sets forth the computation of basic and diluted earnings per common share for the periods indicated:

Diluted earnings per share for the three and six months ended June 30, 2026 excluded 3 and 28 antidilutive shares, respectively.

Note 9. Income Taxes

For the three months ended June 30, 2026 and 2025, the Company recorded an income tax expense of $2,336 and $3,444, respectively, on pre-tax income of $5,451 and $6,283, respectively, for an effective income tax rate of 42.9% and 54.8%, respectively. For the six months ended June 30, 2026 and 2025, the Company recorded an income tax expense of $2,255 and $2,813, respectively, on pre-tax income of $6,862 and $3,535, respectively, for an effective income tax rate of 32.9% and 79.6%, respectively. The Company's effective income tax rate for the three and six months ended June 30, 2026 differed from the federal statutory rate of 21% primarily due to the discrete impact of excess tax benefits related to share-based compensation, offset by the impact of pre-tax losses in the United Kingdom, for which no income tax benefit was recognized due to a valuation allowance. Changes in pre-tax income projections, combined with the seasonal nature of our businesses, also impact the effective income tax rate each quarter.

Note 10. Stock-Based Compensation

The Company recorded stock-based compensation expense of $1,381 and $1,277 for the three months ended June 30, 2026 and 2025, respectively, and $3,263 and $2,111 for the six months ended June 30, 2026 and 2025, respectively, related to restricted stock awards, restricted stock units, and performance-based stock and stock unit awards. As of June 30, 2026, unrecognized compensation expense for awards that the Company expects to vest approximated $6,847. The Company will recognize this unrecognized compensation expense over a weighted average 1.9 years through May 22, 2028.

On May 22, 2025, the shareholders approved the new 2025 Equity and Incentive Compensation Plan (the “Equity and Incentive Compensation Plan”). As of June 30, 2026, the Company had stock awards issued pursuant to the Equity and Incentive Compensation Plan and its predecessor, the 2006 Omnibus Incentive Compensation Plan (the “Omnibus Plan”). No stock options are outstanding under the Omnibus Plan or the Equity and Incentive Compensation Plan and, as such, there was no stock-based compensation expense related to stock options recorded for the three and six months ended June 30, 2026 and 2025.

Non-Employee Director Restricted Stock Awards and Fully-Vested Stock

Since May 2018, non-employee directors have been awarded shares of the Company’s common stock on each date the non-employee directors were elected at the annual shareholders’ meeting to serve as directors, subject to a one-year vesting requirement. The Deferred Compensation Plan for Non-Employee Directors under the Omnibus Plan and, by amendment, under the Equity and Incentive Compensation Plan, permits non-employee directors of the Company to defer receipt of earned cash and/or stock compensation for service on the Board into deferred stock units. Non-Employee directors may also elect to receive quarterly cash compensation in the form of fully-vested stock. During 2026, one Board member has elected to receive fully-vested stock in lieu of cash compensation.

Restricted Stock, Restricted Stock Units, and Performance-Based Stock and Stock Units

Under the Equity and Incentive Compensation Plan and Omnibus Plan, the Company grants certain employees restricted stock, restricted stock units, and performance-based stock and stock units. The forfeitable restricted stock awards and restricted stock units granted generally time-vest ratably over a three-year period, unless indicated otherwise by the underlying restricted stock award and restricted stock unit agreement. Performance stock unit awards are offered annually under separate three-year long-term incentive programs, unless indicated otherwise by the underlying performance unit award agreement. Performance stock units are subject to forfeiture and will be converted into common stock based upon the Company’s performance relative to performance measures and conversion multiples as defined in the underlying program. For restricted stock units granted in 2026, participants who meet the definition of normal retirement, as defined in the 2026 Restricted Stock Unit Agreement filed as Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, the awards continue to vest without the requirement of future service; for these awards, the Company recognizes compensation expense over the period from grant date through the date the employee becomes retirement eligible. During the six months ended June 30, 2026, the Company recognized $497 of stock-based compensation expense associated with the accelerated expense recognition for retirement-eligible employees.

The following table summarizes the restricted stock, restricted stock units, and performance-based stock and stock unit activity for the periods presented:

*Includes stock units for which the performance obligation has been met and are subject only to time vesting requirements prior to distribution.

Note 11. Retirement Plans

The Company has two defined contribution retirement plans that cover its hourly and salaried employees in the United States. Employees are eligible to participate in the appropriate plan based on employment classification. The Company’s contributions to the defined contribution plans are governed by the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and the Company’s policy and investment guidelines applicable to each respective plan. The Company’s policy is to contribute at least the minimum in accordance with the funding standards of ERISA. The Company maintains one defined contribution plan for its employees in Canada. In the United Kingdom, the Company maintains two defined contribution plans and a defined benefit plan, which is frozen.

On May 23, 2024, the Company's Board of Directors approved the termination of the frozen Portec Rail Products (UK) Limited Pension Scheme (the “UK DB Plan”). At such time, the Company notified all plan participants of the Company's intentions to terminate and fully settle the obligations. In January 2025, the Company entered into an insurance buy-in contract with a third party insurer which resulted in an exchange of plan assets of the UK DB Plan for an annuity that covers our future projected benefit obligations. The Company expects the buy out of the plan and transfer of future benefit obligations of plan participants to be completed in 2026. The Company does not expect to make any further contributions to the UK DB Plan.

Defined Contribution Plans

The Company sponsors five defined contribution plans for hourly and salaried employees across its domestic and international facilities. The following table summarizes the expense associated with the contributions made to these plans for the periods presented:

Note 12. Commitments and Contingent Liabilities

Product Liability Claims

The Company is subject to product warranty claims that arise in the ordinary course of its business. For certain manufactured products, the Company maintains a product warranty accrual as a percentage of cost of sales. In addition, the product warranty accrual is adjusted periodically based on the identification or resolution of known individual product warranty claims.

Other Legal Matters

The Company is also subject to other legal proceedings and claims that arise in the ordinary course of its business. Legal actions are subject to inherent uncertainties, and future events could change management’s assessment of the probability or estimated amount of potential losses from pending or threatened legal actions. Based on available information, it is the opinion of management that the ultimate resolution of pending or threatened legal actions, both individually and in the aggregate, will not result in losses having a material adverse effect on the Company’s financial position or liquidity as of June 30, 2026.

If management believes that, based on available information, it is at least reasonably possible that a material loss (or additional material loss in excess of any accrual) will be incurred in connection with any legal actions, the Company discloses an estimate of the possible loss or range of loss, either individually or in the aggregate, as appropriate, if such an estimate can be made, or discloses that an estimate cannot be made. Based on the Company’s assessment as of June 30, 2026, no such disclosures were considered necessary.

Environmental and Legal Proceedings

The Company is subject to national, state, foreign, provincial, and/or local laws and regulations relating to the protection of the environment. The Company’s efforts to comply with environmental regulations may have an adverse effect on its future earnings.

On June 5, 2017, a General Notice Letter was received from the United States Environmental Protection Agency (“EPA”) indicating that the Company may be a potentially responsible party (“PRP”) regarding the Portland Harbor Superfund Site cleanup along with numerous other companies. More than 140 other companies received such a notice. The Company and a predecessor owned and operated a facility near the harbor site for a period prior to 1982. The net present value and undiscounted costs of the selected remedy throughout the harbor site are estimated by the EPA to be approximately $1.1 billion and $1.7 billion respectively, and the remedial work is expected to take as long as 13 years to complete. Other estimates indicate that these costs may increase given that the remedy will not be initiated or completed for several years. The Company is reviewing the basis for its identification by the EPA and the nature of the historic operations of a Company predecessor near the site. Additionally, the Company executed a PRP agreement which provides for a private allocation process among almost 100 PRPs in a working group whose work is ongoing and involves a process that will ultimately conclude a proposed allocation of liability for cleanup of the site and various sub-areas. The Company does not have any individual risk sharing agreements in place with respect to the site, and was only associated with the site from 1976 to when it purchased the stock of a company whose assets it sold in 1982 and which was dissolved in 1994. On March 26, 2020, the EPA issued a Unilateral Administrative Order to two parties requiring them to perform remedial design work for that portion of the Harbor Superfund Site that includes the area closest to the facility; the Company was not a recipient of this Unilateral Administrative Order. On December 2, 2024, the Company and many other PRPs received a Special Notice Letter (“SNL”) from the EPA regarding a formal initiation of negotiations for the investigation and cleanup of the Portland Harbor Superfund Site and requesting a “good faith offer” from certain PRPs as to remediation and reimbursement of costs within 120 days, which, if accepted, would lead to a formal Consent Decree which may not be entered under the EPA's proposed schedule until fall of 2026 or by March 2027. The deadline for a response was extended to May 30, 2025, and the Company responded, along with other similarly-situated parties, in a timely manner. The Company cannot predict the ultimate impact of these proceedings and the SNLs because of the large number of PRPs involved throughout the harbor site, the size and extent of the site, the degree of contamination of various wastes, varying environmental impacts throughout the harbor site, the scarcity of data related to the facility once operated by the Company and a predecessor, potential comparative liability between the allocation parties and regarding non-participants, and the speculative nature of the remediation costs. Based upon information currently available, management does not believe that the Company’s alleged PRP status regarding the Portland Harbor Superfund Site or other compliance with the present environmental protection laws will have a material adverse effect on the financial condition, results of operations, cash flows, competitive position, or capital expenditures of the Company. As more information develops and the allocation process is completed, and given the resolution of factors such as those described above, an unfavorable resolution could have a material adverse effect. As of June 30, 2026 and December 31, 2025, the Company maintained environmental reserves approximating $1,495 for all of its environmental liabilities.

Note 13. Restructuring Costs

During the second quarter of 2025, the Company announced the discontinuation of its Automation and Materials Handling (“AMH”) product line which was reported in the Technology Services and Solutions business unit within the Rail segment (the “AMH Exit”). For the three and six months ended June 30, 2025, AMH had net sales of $813 and $1,220, respectively. The Company incurred a total of $1,351 in exit costs associated with the AMH Exit, which included $655 in inventory and fixed asset write-downs, $507 in personnel expenses, and $189 in other exit costs. Exit costs of $1,085 were recorded in “Cost of goods sold” and $266 were recorded in “Selling and administrative expenses” within our Rail segment. The Company completed the remaining customer obligations in 2025 and all exit costs were incurred in the second quarter of 2025.

During the fourth quarter of 2025, the Company announced a restructuring program aligned with its strategy to reduce costs in the UK-based Technology Services and Solutions business unit within the Rail segment. The restructuring action has been completed as of December 31, 2025. The Company does not expect to incur additional material expenses associated with this program.

During the second quarter of 2026, the Company announced the discontinuation of certain product lines within our Tew Engineering business (the “Tew Exit”) which was reported in the Technology Services and Solutions business unit within the Rail segment. The decision to exit was due to the Company's initiatives to scale back unprofitable product lines in the United Kingdom. The Company expects to complete any remaining customer obligations by the end of 2027. The product lines had net sales of $292 and $1,189 for the three months ended June 30, 2026 and 2025, respectively, and $1,252 and $1,834 for the six months ended June 30, 2026 and 2025, respectively. The Company recognized a total of $2,270 in exit costs associated with the Tew Exit, which included $1,059 in inventory write-downs, $1,159 in personnel expenses, $52 in other exit costs during the quarter. Exit costs of $2,084 were recorded in “Cost of goods sold” and $186 were recorded in “Selling and administrative expenses.” The Company does not expect to incur additional material expenses associated with this program. In addition to the Tew Exit costs, the Company incurred corporate costs recorded in “Selling and administrative expenses”of $292 related to the execution of strategic initiatives.

The following table sets forth a reconciliation of the beginning and ending restructuring liability balance for all programs through June 30, 2026:

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

(Dollars in thousands, except share data)

General Overview and Business Update

L.B. Foster Company is a global technology solutions provider of products and services for the rail and infrastructure markets. The Company’s innovative engineering and product development solutions address the safety, reliability, and performance needs of its customers' most challenging requirements. The Company is organized and operates in two reporting segments: Rail, Technologies, and Services (“Rail”) and Infrastructure Solutions (“Infrastructure”).

Product Line Exits

On August 30, 2023, the Company announced the discontinuation of its Bridge Products grid deck product line which was reported in the Steel Products business unit within the Infrastructure segment. For the three and six months ended June 30, 2025, the product line had net sales of $498 and $999, respectively. The Company completed all customer obligations in 2025.

During the second quarter of 2025, the Company announced the discontinuation of its Automation and Materials Handling (“AMH”) product line which was reported in the Technology Services and Solutions business unit within the Rail segment (the “AMH Exit”). For the three and six months ended June 30, 2025, AMH had net sales of $813 and $1,220, respectively. The Company incurred a total of $1,351 in exit costs associated with the AMH Exit, which included $655 in inventory and fixed asset write-downs, $507 in personnel expenses, and $189 in other exit costs. Exit costs of $1,085 were recorded in “Cost of goods sold” and $266 were recorded in “Selling and administrative expenses” within our Rail segment. The Company completed the remaining customer obligations in 2025 and all exit costs were incurred in the second quarter of 2025.

During the second quarter of 2026, the Company announced the discontinuation of certain product lines within our Tew Engineering business (the “Tew Exit”) which was reported in the Technology Services and Solutions business unit within the Rail segment. The decision to exit was due to the Company's initiatives to scale back unprofitable product lines in the United Kingdom. The product lines had net sales of $292 and $1,189 for the three months ended June 30, 2026 and 2025, respectively, and $1,252 and $1,834 for the six months ended June 30, 2026 and 2025, respectively. The Company expects to complete remaining customer obligations by 2027. The Company has recognized a total of $2,270 in exit costs associated with the Tew Exit, which included $1,059 in inventory write-downs, $1,159 in personnel expenses, and $52 in other exit costs during the quarter. Exit costs of $2,084 were recorded in “Cost of goods sold” and $186 were recorded in “Selling and administrative expenses” within our Rail segment. In addition to the Tew Exit costs, the Company incurred corporate costs recorded in “Selling and administrative expenses” of $292 related to the execution of strategic initiatives.

Results of Operations

Second Quarter 2026 Compared to Second Quarter 2025

Results Summary

Net sales for the three months ended June 30, 2026 decreased $5,008, or 3.5%, from the prior year quarter, driven by lower sales in both segments. Rail net sales declined $3,961, or 5.2%, while Infrastructure declined $1,047, or 1.5%.

Gross profit for the three months ended June 30, 2026 was flat compared to the prior year quarter. Rail gross profit declined $321, as benefits from favorable business mix were offset by $2,084 of costs related to the Tew Exit, compared to $1,085 of costs associated with the AMH Exit in the prior year quarter. Infrastructure gross profit improved $295 driven by favorable business mix. Gross profit margins improved 80 basis points to 22.3%.

Selling and administrative expenses for the three months ended June 30, 2026 increased $1,723, or 7.7%, over the prior year quarter, primarily attributable to increased employment costs including higher variable incentive-based compensation costs. Selling and administrative expenses as a percentage of net sales increased 180 bps to 17.4%.

Amortization expense for the three months ended June 30, 2026 decreased $222, or 26.4%, from the prior year quarter due to acquired intangible assets becoming fully amortized.

Net interest expense for the three months ended June 30, 2026 decreased $599 from the prior year quarter. The Company's outstanding debt balance was $47,993 as of June 30, 2026, compared to $81,628 as of June 30, 2025.

The Company’s effective income tax rate for the three months ended June 30, 2026 was 42.9%, compared to 54.8% in the prior year quarter. The current quarter income tax rate differed from the statutory rate of 21% primarily due to the impact of pre-tax losses in the United Kingdom for which no income tax benefit was recognized due to a valuation allowance.

Net income attributable to the Company for the three months ended June 30, 2026 was $3,112, or $0.29 per diluted share, compared to net income in the prior year quarter of $2,885, or $0.27 per diluted share. The increase is due to reduced interest expense and a lower effective income tax rate.

Results of Operations - Segment Analysis

Rail, Technologies, and Services

Rail net sales for the three months ended June 30, 2026 decreased $3,961, or 5.2 %, from the prior year quarter. Rail Products net sales decreased $13,001, or 27.3%, primarily due to the timing of large orders. This decline was offset by an increase of $3,703, or 18.1%, in Global Friction Management driven by strong domestic demand and an increase of $5,337, or 66.9%, in Technology Services and Solutions (“TS&S”) driven by short term project work in the UK.

Rail gross profit for the three months ended June 30, 2026 decreased $321, or 2.1 %, from the prior year quarter, primarily due to lower sales volumes in Rail Products which impacted gross profit by $2,159. Partially offsetting this decline were gross profit improvements of $606 in Global Friction Management, driven by higher volumes, and $1,232 in TS&S, reflecting favorable business mix and short-term project work in the UK. TS&S incurred $2,084 of Tew Exit costs in the current quarter compared to $1,085 of AMH Exit costs incurred in the prior year quarter. Gross profit margin improved 70 basis points to 20.6 % due to favorable business mix.

Rail operating income for the three months ended June 30, 2026 decreased $758, or 20.2 %, from the prior year quarter driven by the gross profit decline coupled with $641 of higher selling and administrative costs.

For the three months ended June 30, 2026, Rail had new orders, net of $112,207, a decrease of $2,138 from the prior year quarter primarily attributable to the timing of large orders associated with Rail Products which declined 20.0%. Global Friction Management

and TS&S improved 27.8% and 126.4%, respectively. The improvement in TS&S was primarily attributable to increased short-term project work in the UK. Backlog as of June 30, 2026, was $141,395, a $10,686, or 8.2%, increase over the prior year quarter as a result of a large order received in our UK business.

Infrastructure Solutions

Infrastructure net sales for the three months ended June 30, 2026, decreased $1,047 or 1.5%, from the prior year quarter. The decline was driven by $1,996, or 9.3%, in Steel Products, which was partially offset by sales growth of $949, or 2.1%, in Precast Concrete Products (“Precast”).

Infrastructure gross profit for the three months ended June 30, 2026 increased $295, or 1.9 %, over the prior year quarter. Precast gross profit improved $615 due to improved business mix. Steel Products gross profit declined $320 due to lower sales volumes. Gross profit margins improved 80 basis points to 24.1%.

Infrastructure operating income for the three months ended June 30, 2026 decreased $195, or 2.9%, from the prior year quarter due to an increase in selling, general and administrative expenses, offset in part by improved gross profit.

For the three months ended June 30, 2026, Infrastructure had new orders, net of $63,869, an increase of $2,458, over the prior year quarter due primarily to a 73.3% increase in Steel Products stemming from improving Protective Coatings demand. This increase was partially offset by a 15.4% decrease in Precast. Backlog as of June 30, 2026, was $104,718, a decrease of $34,502, or 24.8%, from the prior year quarter attributable to a 2025 order cancellation in Steel Products which resulted in a 41.1% decline, coupled with a decline of 17.1% in Precast.

Corporate

**Results of this calculation are not meaningful for presentation purposes.

Unallocated corporate expense - net for the three months ended June 30, 2026 was $3,409 compared to $2,835 for the three months ended June 30, 2025. During the quarter, the Company incurred $292 of costs associated with strategic initiatives. Public company costs decreased by $572 due to lower professional service fees. Corporate executive management costs and stock-based compensation increased $709 and $145, respectively, due to increased variable incentive-based compensation expense.

Results of Operations

First Six Months 2026 Compared to First Six Months 2025

Results Summary

Net sales for the six months ended June 30, 2026 increased $18,344, or 7.6%, over the prior year period. The increase was driven by Rail sales growth of $16,800, or 12.9%, with Infrastructure sales modestly improving $1,544, or 1.4%.

Gross profit for the six months ended June 30, 2026 increased $5,519, or 10.8%, over the prior year period driven primarily by improved sales volumes and business mix in Rail, which increased $3,792. Infrastructure gross profit improved $1,727 due to favorable business mix and manufacturing execution. Gross profit margins improved 60 basis points to 21.8%.

Selling and administrative expenses for the six months ended June 30, 2026 increased $3,804, or 8.8%, over the prior year period, due primarily to an increase in employment costs driven by higher variable incentive-based compensation costs, and a $497 accelerated stock expense due to retirement-eligible participants. Selling and administrative expenses as a percentage of net sales increased 20 basis points to 18.2%.

Net interest expense decreased $891 for the six months ended June 30, 2026 compared to the prior year period. The Company's outstanding debt balance was $47,993 as of June 30, 2026, compared to $81,628 as of June 30, 2025.

The Company’s effective income tax rate for the six months ended June 30, 2026 was 32.9%, compared to 79.6% in the prior year period. The current period effective income tax rate differed from the statutory rate of 21% primarily due to the impact of excess tax benefits related to share-based compensation, offset by the impact of pre-tax losses in the United Kingdom for which no income tax benefit was recognized due to a valuation allowance.

Net income attributable to the Company for the six months ended June 30, 2026 was $4,612, or $0.44 per diluted share, compared to net income in the prior year period of $775, or $0.07 per diluted share. The higher net income for the six months ended June 30, 2026 was primarily driven by an increase in gross profit, reduced interest expense, and lower amortization expense offset in part by an increase in selling and administrative expenses.

Results of Operations - Segment Analysis

Rail, Technologies, and Services

Rail net sales for the six months ended June 30, 2026 increased $16,800, or 12.9 %, over the prior year period. The increase was primarily driven by Global Friction Management which increased $9,847, or 27.4%, reflecting strong domestic demand and TS&S which increased $7,994, or 46.7%, driven by short term project work in the UK. These increases were partially offset by a decrease in Rail Products net sales of $1,041, or 1.4%.

Rail gross profit for the six months ended June 30, 2026 increased $3,792, or 14.0%, over the prior year period. The improvement was due to higher sales volumes in Global Friction Management, which contributed $3,246 of gross profit improvement, and more favorable sales mix in TS&S which contributed an additional $976. TS&S incurred $2,084 of Tew Exit costs in the six months ended June 30, 2026 compared to $1,085 of AMH Exit costs incurred in the prior year period. These improvements were partially offset by a $430 decline in Rail Products gross profit attributable to lower sales volumes. Gross profit margins improved 20 basis points to 21.1%.

Rail operating income for the six months ended June 30, 2026 increased $3,918 over the prior year period. The increase was driven by an increase in gross profit associated with higher sales volumes and lower amortization expense.

For the six months ended June 30, 2026, Rail new orders, net were $192,835, a decrease of $4,762 from the prior year period. The decline was primarily attributable to Rail Products which decreased 12.3% due to timing of large orders. Partially offsetting this decline were increases in TS&S and Global Friction Management. New orders, net in TS&S increased 68.6%, driven by a large order received in the UK business, while Global Friction Management reported a modest increase of 0.7%.

Infrastructure Solutions

Infrastructure net sales for the six months ended June 30, 2026 increased $1,544, or 1.4 %, over the prior year period. The increase was primarily due to Precast sales growth of $5,790, or 7.8%, partially offset Steel Products which declined $4,246, or 11.5%.

Infrastructure gross profit for the six months ended June 30, 2026 increased $1,727, or 7.2%, over the prior year period. The increase was primarily driven by a $2,606 improvement in Precast gross profit, reflecting higher sales volume, more favorable business mix, and improved manufacturing execution. This improvement was partially offset by lower volumes in Steel Products, which resulted in a $879 decrease in gross profit. Gross profit margins increased 120 basis points to 22.7 %.

Infrastructure operating income for the six months ended June 30, 2026 was favorable $778 compared to the prior year period due to improvements in gross profit partially offset by a $989 increase in selling and administrative expenses.

For the six months ended June 30, 2026, Infrastructure new orders, net were $125,327, a decrease of $1,896, from the prior year period. The decrease was primarily due to Precast, where new orders, net declined 5.8% from the prior year period. This decline was partially offset by a 8.5% increase in Steel Products, driven by strong order activity in our Protective Coatings business.

Corporate

**Results of this calculation are not meaningful for presentation purposes.

Unallocated corporate expense - net for the six months ended June 30, 2026 was $6,713 compared to the six months ended June 30, 2025 which was $4,458. Public company costs decreased by $592 due to lower professional service fees. Corporate executive management costs increased $1,279 due to higher incentive-based compensation costs. Corporate management stock-based compensation expense increased $1,276 due in part to $497 of accelerated stock expense due to retirement-eligible participants. During the six months ended June 30, 2026, the Company incurred $292 of costs associated with strategic initiatives.

Liquidity and Capital Resources

The Company’s principal sources of liquidity are its existing cash and cash equivalents, cash generated by operations, and the available capacity under the revolving credit facility. The revolving credit facility provides for a total commitment of up to $150,000, of which $101,695 was available for borrowing as of June 30, 2026, subject to covenant restrictions. The Company’s primary needs for liquidity relate to working capital requirements for operations, capital expenditures, debt service obligations, tax obligations, outstanding purchase obligations, acquisitions, restructuring payments, and to support the share repurchase program. The Company’s total debt, including finance leases, was $47,993 and $42,756 as of June 30, 2026 and December 31, 2025, respectively, and was primarily comprised of borrowings under its revolving credit facility.

The following table reflects available funding capacity as of June 30, 2026:

As of June 30, 2026, we were in compliance with all covenants of the Credit Agreement and have $107,478 available funding capacity, subject to covenant restrictions.

The Company’s operating cash flows are impacted from period to period by fluctuations in working capital needs, as well as its overall profitability. While the Company places an emphasis on working capital management in its operations, factors such as its business mix, commercial terms, and market conditions as well as seasonality may impact its working capital. The Company regularly assesses its receivables and contract assets for collectability and realization, and provides allowances for credit losses where appropriate. The Company believes that its reserves for credit losses are appropriate as of June 30, 2026, but adverse changes in the economic environment and adverse financial conditions of its customers may impact certain of its customers’ ability to access capital and compensate the Company for its products and services, as well as impact demand for its products and services.

The changes in cash and cash equivalents for the six months ended June 30, 2026 and 2025 were as follows:

Cash Flow from Operating Activities

During the six months ended June 30, 2026, net cash provided by operating activities was $7,422, compared to net cash used in operating activities of $15,734 during the prior year period. For the six months ended June 30, 2026, net income and adjustments to reconcile net income from operating activities provided $16,129, compared to $12,553 in the prior year period. Working capital and other assets and liabilities were a use of $8,707 in the current period, compared to a use of $28,287 in the prior year period. The increase in operating cash flow for the six months ended June 30, 2026 compared to the prior year period was largely driven by lower working capital needs and improved profitability.

Cash Flow from Investing Activities

Capital expenditures for the six months ended June 30, 2026 and 2025 were $6,521 and $5,248, respectively. Capital expenditures in both periods primarily relate to general plant and operational improvements throughout the Company, as well as organic growth initiatives.

Cash Flow from Financing Activities

During the six months ended June 30, 2026, outstanding debt increased $5,271 compared with an increase of $32,340 during the six months ended June 30, 2025. The lower increase in borrowings from the prior year period was primarily driven by operating cash generation from lower working capital requirements and a reduction in treasury stock repurchases. During the six months ended June 30, 2026, the Company repurchased $4,263 of its stock to satisfy employee tax withholding obligations related to the issuance of equity-based compensation awards. The Company also made deferred acquisition-related payments of $403 and $782, during the six months ended June 30, 2026 and 2025, respectively, related to the June 2022 acquisition of Skratch Enterprises Ltd. These payments were deferred at the date of the acquisition in accordance with the purchase agreement. Additionally, during the six months ended June 30, 2025, the Company incurred debt issuance costs of $706 associated with entering into the June 27, 2025 Fifth Amended and Restated Credit Agreement.

The Board of Directors previously authorized the repurchase of up to $15,000 of the Company's common shares until February 2025, pursuant to the terms of the previously disclosed stock repurchase program adopted March 3, 2023, as amended August 5, 2024. On March 3, 2025, the Company's Board of Directors approved a new authorization to repurchase up to $40,000 of the Company's common stock in open market transactions and/or 10b5-1 trading plans through February 29, 2028. The Company did not repurchase any shares during the six months ended June 30, 2026 under this program. From February 2023 through June 30, 2026, the Company repurchased a total of 1,016,899 shares of its stock for $23,554 under both programs.

Repurchases of shares of the Company’s common stock may be made from time to time in the open market or in such other manner as determined by the Company. The timing of the repurchases and the actual amount repurchased will depend on a variety of factors, including the market price of the Company’s shares, general market and economic conditions, and other factors. The stock repurchase program does not obligate the Company to acquire any particular amount of common stock and may be suspended or discontinued at any time.

Financial Condition

As of June 30, 2026, the Company had $5,783 in cash and cash equivalents and $101,695 of availability under its revolving credit facility, subject to covenant restrictions. As of June 30, 2026, approximately $4,430 of the Company’s cash and cash equivalents were held in non-domestic bank accounts.

The Company’s principal uses of cash in recent years have been to fund its operations, including capital expenditures, repurchase of shares, acquisitions, and service indebtedness. The Company views its short and long-term liquidity as being dependent on its results of operations, changes in working capital needs, and its borrowing capacity.

On June 27, 2025, the Company, its domestic subsidiaries, and certain of its Canadian and United Kingdom subsidiaries (collectively, the “Borrowers”), entered into the Fifth Amended and Restated Credit Agreement (the “Credit Agreement”) with PNC Bank, N.A., Bank of America, N.A., Citizens Bank, N.A., and Wells Fargo Bank N.A. as Co-Syndication Agents, and Dollar Bank, Federal

Savings Bank as a participant. The Credit Agreement, which expires on June 27, 2030, provides for a five-year, revolving credit facility that permits aggregate borrowings of the Borrowers up to $150,000 with sublimits for (a) the issuance of letters of credit in dollars and in alternative currencies in an amount not to exceed the dollar equivalent of $30,000, and (b) borrowings of swing loans in dollars in an amount not to exceed $20,000; and with an incremental loan feature not to exceed $60,000. For a discussion of the terms and availability of the credit facilities, please refer to Note 7 of the Notes to Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q.

Critical Accounting Estimates

The Condensed Consolidated Financial Statements have been prepared in conformity with US GAAP. The preparation of the Condensed Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amount of assets, liabilities, revenues, and expenses, and the related disclosure of contingent assets and liabilities. As a result, actual results could differ from these estimates. The Company has concluded that there have been no significant changes to its critical accounting policies or estimates as described in its Annual Report on Form 10-K for the year ended December 31, 2025.

Non-GAAP Financial Measures

In accordance with SEC rules, the Company provides descriptions of the non-GAAP financial measures included in this filing and reconciliations to the most closely related GAAP financial measures. The Company believes that these measures provide useful perspective on underlying business trends and results and a supplemental measure of year-over-year results. The non-GAAP financial measures described below are used by management in making operating decisions, allocating financial resources and for business strategy purposes and may, therefore, also be useful to investors as they are a view of our business results through the eyes of management. These non-GAAP financial measures are not intended to be considered by the user in place of the related GAAP financial measure, but rather as supplemental information to our business results. These non-GAAP financial measures may not be the same as similar measures used by other companies due to possible differences in method and in the items or events being adjusted.

The Company defines new orders, net as a contractual agreement between the Company and a third-party in which the Company will, or has the ability to, satisfy the performance obligations of the promised products or services under the terms of the agreement net of order cancellations incurred during the period. The Company defines backlog as contractual commitments to customers for which the Company’s performance obligations have not been met, including with respect to new orders and contracts for which the Company has not begun any performance. Backlog may not be indicative of future operating results as orders may be cancelled or modified by the customer. Management utilizes new orders, net and backlog to evaluate the health of the industries in which the Company operates, the Company’s current and future results of operations and financial prospects, and strategies for business development. The Company believes that new orders, net and backlog are useful to investors as supplemental metrics by which to measure the Company’s current performance and prospective results of operations and financial performance.

Non-GAAP financial measures are not a substitute for GAAP financial results and should only be considered in conjunction with the Company’s financial information that is presented in accordance with GAAP.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

This item is not applicable to the Company.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

L.B. Foster Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of June 30, 2026, the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of such date to provide reasonable assurance that the information required to be disclosed by the Company in reports filed under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to management, including the Chief Executive Officer, Chief Financial Officer, or person performing such functions, as appropriate to allow timely decisions regarding disclosure.

Changes in Internal Control Over Financial Reporting

There were no changes to our “internal control over financial reporting” (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2026.

Limitations on Effectiveness of Controls and Procedures

In designing and evaluating disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

PART II. OTHER INFORMATION

(Dollars in thousands, except share data)

Item 1. Legal Proceedings

See Note 12 of the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q, which is incorporated herein by reference.

Item 1A. Risk Factors

This item is not applicable to the Company.

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

On March 3, 2025, the Company's Board of Directors authorized the repurchase of up to $40,000 of the Company's common stock in open market transactions and/or 10b5-1 trading plans through February 29, 2028. Repurchases of shares of the Company’s common stock may be made from time to time in the open market or in such other manner as determined by the Company. The timing of the repurchases and the actual amount repurchased will depend on a variety of factors, including the market price of the Company’s shares, general market and economic conditions, and other factors. The stock repurchase program does not obligate the Company to acquire any particular amount of common stock and may be suspended or discontinued at any time.

The Company’s purchases of equity securities for the three months ended June 30, 2026 were as follows:

(a) During the current period, 11,095 shares were withheld by the Company to pay taxes upon vesting of stock.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

This item is not applicable to the Company.

Item 5. Other Information

Trading Arrangements

None of the Company’s directors or “officers,” as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K, during the Company’s fiscal quarter ended June 30, 2026.

Item 6. Exhibits

See Exhibit Index below.

Exhibit Index

Exhibit Number Description

*31.1 Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.

*31.2 Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.

*32.0 Certification of Chief Executive Officer and Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002.

*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 XBRL Taxonomy Extension Schema Document.

*101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.

*101.DEF XBRL Taxonomy Extension Definition Linkbase Document.

*101.LAB XBRL Taxonomy Extension Label Linkbase Document.

*101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.

*104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

* Exhibits marked with an asterisk are filed herewith.