Mesa Laboratories MLAB Form 10-Q filing Q3 FY2026

Overview

We are a global leader in the design and manufacture of life sciences tools and critical quality control solutions for regulated applications in the pharmaceutical, healthcare and medical device industries. We offer products and services to help our customers ensure product integrity, increase patient and worker safety, and improve the quality of life throughout the world. We have manufacturing operations in the United States and Europe, and our products are marketed by our sales personnel in North America, Europe, and the APAC region, and by independent distributors throughout the world.

As of December 31, 2025, we managed our operations in four reportable segments, or divisions: Sterilization and Disinfection Control, Biopharmaceutical Development ("BPD"), Calibration Solutions, and Clinical Genomics. Each of our divisions is described further in "Results of Operations" below.

Corporate Strategy

We strive to create stakeholder value and further our purpose of Protecting the Vulnerable® by growing our business both organically and through acquisitions, by improving our operating efficiency, and by continuing to hire, develop and retain top talent. We commit to our purpose every day by taking a customer-focused approach to developing, building and delivering our products and services. We serve a broad set of industries, particularly the pharmaceutical, healthcare and medical device sectors, in which the safety, quality and efficacy of products is critical. By delivering the highest quality products possible, we are committed to protecting the communities we serve.

Our continued growth will depend on our ability to (i) expand business with new and existing customers through ongoing commercial efforts, (ii) manage our costs and allocate resources to ensure continued profitability of our business, (iii) identify, consummate and integrate acquisitions successfully, and (iv) develop or acquire differentiated products and services. We strive to maintain our profitability by improving the effectiveness of our sales force, by continuing to pursue cost reduction initiatives, and by taking a long-term strategic approach to investments in our business that we believe will support future commercial success.

Page 15

Organic Revenues Growth

Organic revenues growth is driven by expansion of our customer base, increases in sales volumes, new product offerings and price increases, and may be affected positively or negatively by the impact of changes in foreign currency exchange rates on our reported revenues. Our ability to increase organic revenues is affected by general economic conditions, both domestic and international, customer capital spending trends, competition, currency exchange rates, and the introduction of new products. Our policy is to price our products and services competitively and, where possible, we pass along cost increases to our customers in order to maintain our margins. We typically evaluate costs and pricing annually, with price increases effective January 1. We evaluate the need to increase prices at other times of the year in response to significant facts and circumstances that may arise, such as increases in the price of inputs to our products, or in response to changes in government or regulatory policies, for example, due to the imposition of tariffs.

Inorganic Growth - Acquisitions

Over the past decade, we have consummated a number of acquisitions of businesses, technologies, and intangibles such as customer lists as part of our growth strategy. Our acquisitions have allowed us to expand our product offerings and the industries we serve, globalize our company, and increase the scale at which we operate. In turn, this growth affords us the ability to improve our operating efficiency, extend our customer base, and further the pursuit of our purpose: Protecting the Vulnerable®.

Improving Our Operating Efficiency

Our ongoing goal is to maximize value in our businesses by implementing efficiencies in our manufacturing, commercial, engineering and administrative operations. We achieve efficiencies using the Mesa Way, our customer-centric, lean-based system for continuous improvement. The Mesa Way is built on four key pillars: "Measuring What Matters" based on our customers' perspectives and setting high standards of performance; "Empowering Teams" to improve operationally and to exceed customer expectations; "Sustainably Improving" using lean-based tools designed to help us identify and prioritize the best opportunities; and "Always Learning" to continuously build knowledge and capabilities to drive long-term performance.

Our gross profit is affected by many factors, including the mix of products and services sold and the geographical regions in which we sell them, labor and product costs (including costs of transporting, importing and exporting goods, as well as associated tariffs), manufacturing efficiencies, foreign currency rates and price competition. Historically, as we have integrated acquisitions into our business and taken advantage of manufacturing efficiencies, our gross profit percentages for some products have improved. There are, however, differences in gross profit percentages between product lines, and ultimately our mix of revenues will continue to impact our overall gross profit.

We continuously pursue opportunities to improve the efficiency of our administrative functions, including through increasing usage of process automation and artificial intelligence.

Hire, Develop, and Retain Top Talent

At the center of our organization are talented people who are capable of taking on new challenges using a team-based approach. Indeed, it is our exceptionally talented workforce that collaborates to find ways to continuously and sustainably improve our products, our services, and ourselves, resulting in long-term value creation for our stakeholders.

General Trends

As a global company, our geographic and industry diversity presents both opportunities and challenges, including those associated with pursuing expansion opportunities in high-growth markets, operating in varied economic environments, complying with evolving regulatory requirements such as tariffs, navigating global labor trends and costs, adapting to technology changes in served markets, and monitoring foreign currency impacts against the U.S. dollar ("USD"). During the nine months ended December 31, 2025, approximately 53% of our revenues were earned outside of the United States.

For the nine months ended December 31, 2025, revenues grew 3.7% versus the comparable prior year period, driven by growth in our Biopharmaceutical Development, Sterilization and Disinfection Control, and Calibration Solutions divisions. Our Clinical Genomics division continued to experience revenue declines due to trade tensions and unfavorable macroeconomic conditions in China, which have weakened demand for our Clinical Genomics products and services in that region. We expect that challenges in China will persist through the end of fiscal year 2026 and will most likely continue into fiscal year 2027. Despite challenges in China, Clinical Genomics has continued to execute its product development and commercial strategy successfully in the Americas and Europe, and our cost savings initiatives and geographic mix have resulted in improved gross profit percentages during the three and nine months ended December 31, 2025 versus the comparable prior year periods.

Consolidated gross profit as a percentage of revenues in the nine months ended December 31, 2025 was largely consistent with the comparable prior year period. The weakening of the U.S. dollar versus the comparable prior year period and the impact of tariffs reduced consolidated year-to-date gross profit as a percentage of revenues by approximately 0.8 percentage points, with a particularly pronounced effect on our Biopharmaceutical Development and Sterilization and Disinfection Control divisions. The decreases were partially offset by GKE-related inventory step-up amortization expense that reduced margins in the prior year period, and in the current year period, cost‑savings initiatives implemented in the prior quarter and favorable geographic revenues mix within the Clinical Genomics division resulted in higher reported margins.

Operating expenses increased 2.8% for the nine months ended December 31, 2025 compared to the prior year period, but decreased slightly as a percentage of revenues. The increase in operating expenses was largely driven by (i) higher allowances on accounts receivable, particularly in China, and (ii) higher personnel expense, including increased stock-based compensation from performance-based awards, and severance expense related primarily to Clinical Genomics. The increase was partially offset by lower professional services and consulting fees as the comparable prior year period included GKE integration costs. In addition, the weaker U.S. dollar versus the comparable prior year period caused expenses denominated in foreign currencies to translate into higher reported U.S. dollar amounts in our financial statements.

Page 16

Results of Operations

Our results of operations and period-over-period changes are discussed in the following section. The tables and discussion below should be read in conjunction with the accompanying unaudited Condensed Consolidated Financial Statements and the notes thereto appearing in Item 1. Financial Statements.

Results by reportable segment are as follows:

(a) Organic revenues growth is a non-GAAP measure of financial performance. See "Non-GAAP Measures" below for further information and for a reconciliation of organic revenues growth to total revenues growth. Organic revenues growth in our Sterilization and Disinfection Control division for the three and nine months ended December 31, 2024 differed from total U.S. GAAP revenues growth due to the acquisition of GKE; for all other amounts presented, U.S. GAAP revenues growth is equivalent to organic revenues growth.

Our unaudited condensed consolidated results of operations are as follows:

Reportable Segments

Sterilization and Disinfection Control

Our Sterilization and Disinfection Control division manufactures and sells biological, chemical and cleaning indicators used to assess the effectiveness of sterilization, decontamination, disinfection and cleaning processes in the pharmaceutical, medical device and healthcare industries. The division also provides testing and laboratory services, mainly to the dental and pharmaceutical industries. Sterilization and Disinfection Control products are disposable and are used on a routine basis.

Revenues for the Sterilization and Disinfection Control division increased 6.0% and 5.5%, respectively, for the three and nine months ended December 31, 2025 versus the comparable prior year periods. The increases were primarily attributable to the weakening of the USD, higher sales volumes and price increases during fiscal 2026. Excluding the impact of foreign currency translation, revenues would have increased approximately 2.4% and 2.3% for the three and nine months ended December 31, 2025, respectively. The Sterilization and Disinfection Control division’s backlog modestly decreased sequentially in the third quarter of fiscal year 2026 as order fulfillments returned to normal levels.

Gross profit as a percentage of revenues decreased slightly for the three months ended December 31, 2025 versus the comparable prior year period. The decrease is primarily attributable to the impact of the weaker USD, partially offset by higher revenues on a partially fixed cost base. Gross profit as a percentage of revenues increased by 0.8 percentage points for the nine months ended December 31, 2025 versus the comparable prior year period, primarily due to the impact of inventory step-up amortization related to the GKE acquisition in the prior year, partially offset by the weakening USD. Excluding the impact of prior year inventory step-up amortization and foreign currency translation, gross profit as a percentage of revenues for the three and nine months ended December 31, 2025 would have been largely consistent with the comparable prior year periods.

Page 17

Biopharmaceutical Development

Our Biopharmaceutical Development division develops, manufactures, sells and services automated systems for protein analysis (immunoassays) and peptide synthesis solutions. Immunoassays and peptide synthesis solutions accelerate the discovery, development and manufacture of biotherapeutic therapies, among other applications.

Revenues for the Biopharmaceutical Development division increased 17.5% and 10.2%, respectively, for the three and nine months ended December 31, 2025 versus the comparable prior year periods. Increases in revenues for the three months ended December 31, 2025 were primarily driven by increased peptides and immunoassays hardware sales volumes, along with the weakening of the USD. Increases in revenues for the nine months ended December 31, 2025 were primarily driven by higher sales volumes of peptides instruments and immunoassays consumables and services, as well as the weakening of the USD.

Gross profit as a percentage of revenues for the Biopharmaceutical Development division increased 0.5 percentage points for the three months ended December 31, 2025 versus the comparable prior year period. The increase was primarily due to higher revenues on a partially fixed cost base, partially offset by the impacts of foreign currency translation and tariffs.

Gross profit as a percentage of revenues for the Biopharmaceutical Development division decreased 4.1 percentage points for the nine months ended December 31, 2025, primarily due to the impacts of foreign currency translation and tariffs. Unfavorable product mix also contributed to the decline, as higher-margin immunoassays revenues represented a smaller share of total revenues, while hardware represented a larger share.

Excluding the impacts of foreign currency translation and tariffs, gross profit as a percentage of revenues would have increased by approximately 3.2 percentage points and decreased by approximately 1.7 percentage points, respectively, for the three and nine months ended December 31, 2025, versus the comparable prior year periods.

Calibration Solutions

The Calibration Solutions division develops, manufactures, sells and services quality control products using principles of advanced metrology to enable customers to measure and calibrate critical parameters in applications such as renal care, environmental and process monitoring, gas flow and torque testing.

Revenues for the Calibration Solutions division decreased 2.5% for the three months ended December 31, 2025 versus the comparable prior year period. The decrease was primarily due to particularly strong commercial activity in our renal care product lines in the prior year period. Revenues for the Calibration Solutions division increased 3.9% for the nine months ended December 31, 2025 versus the comparable prior year period, primarily driven by ongoing commercial efforts to establish and renew contracts that incentivize utilization of our service offerings, and to a lesser extent, by price increases.

Gross profit as a percentage of revenues decreased by 1.0 and 1.1 percentage points, respectively, for the three and nine months ended December 31, 2025 versus the comparable prior year period, primarily due to unfavorable product mix and increased personnel-related costs that we expect will support future growth.

Clinical Genomics

The Clinical Genomics division develops, manufactures and sells highly sensitive high-throughput genetic analysis tools and related consumables and services that enable clinical research labs and contract research organizations to perform genomic testing for a broad range of research applications in several therapeutic areas, such as screenings for hereditary diseases, pharmacogenetics, oncology related applications and toxicology research.

Revenues for the Clinical Genomics division declined 7.1% and 6.7% for the three and nine months ended December 31, 2025, respectively, versus the comparable prior year periods. The decreases were driven primarily by lower sales to customers in China, reflecting ongoing macroeconomic and regulatory uncertainty and heightened trade tensions. Excluding sales to China, revenues increased 2.4% and 8.4% for the three and nine months ended December 31, 2025 versus the comparable prior year periods.

Clinical Genomics’ gross profit as a percentage of revenues increased 5.6 percentage points and 1.7 percentage points, respectively, for the three and nine months ended December 31, 2025 versus the comparable prior year periods, despite lower revenues. The increases in gross profit as a percentage of revenues were primarily attributable to manufacturing and supply chain efficiency improvements, lower personnel-related costs attributable to our cost mitigation efforts in the prior quarter, and favorable geographic product mix, as sales outside of China typically generate higher margins. Gross profit as a percentage of revenues for the nine months ended December 31, 2025 was also positively impacted by product mix, as higher-margin consumables represented a greater portion of the division's total revenues.

Page 18

Operating Expense

Operating expense was flat for the three months ended December 31, 2025 and increased 2.8% for the nine months ended December 31, 2025, versus the comparable prior year periods. Operating expense as a percentage of revenues decreased 2.2 percentage points and 0.5 percentage points for the three and nine months ended December 31, 2025, respectively, versus the comparable prior year periods. Among other factors, reported selling, general and administrative, and research and development expenses increased due to the weakening of the U.S. dollar against the euro and Swedish krona for the three and nine months ended December 31, 2025 versus the comparable prior year periods.

Selling Expense

Selling expense is driven primarily by labor costs, including salaries and commissions; accordingly, it may vary with sales levels.

Selling expense decreased 4.4% for the three months ended December 31, 2025 versus the comparable prior year period, primarily due to lower expenditures on certain outside services as we began to transition more of our commercial selling efforts in-house. Selling expense increased 1.0% for the nine months ended December 31, 2025 versus the comparable prior year period primarily due to severance costs, investments in certain professional services to support lead-generation and marketing, and higher commissions expense.

General and Administrative Expense

Labor costs, amortization of intangible assets, and non-cash stock-based compensation drive the substantial majority of our general and administrative expense.

General and administrative expense increased 1.8% and 3.4%, respectively, for the three and nine months ended December 31, 2025 versus the comparable prior year periods. The increases were primarily attributable to higher expense related to estimated uncollectible accounts receivable related to customers in China. Higher personnel costs, including higher non-cash stock-based compensation resulting from an adjustment to performance-based awards to reflect achievement against targets through December 31, 2025, also contributed to the increase. The increases were partially offset by lower consulting and professional services expenses, as the prior year periods included consulting costs associated with integrating GKE into our enterprise resource planning system.

Research and Development Expense

Research and development expense is predominantly comprised of labor costs and costs of third-party consultants.

Research and development expenses were flat for the three months ended December 31, 2025 versus the comparable prior year period, as decreased salaries expense was offset by the impact of foreign currency translation and higher benefits-related costs. Research and development expense increased approximately 4.4% for the nine months ended December 31, 2025. The increase was primarily attributable to purchases of supplies and consulting services to support project-specific research and development activities, as well as severance costs, particularly within our Clinical Genomics division.

Non-Operating Expense (Income), Net

Interest expense increased for the three months ended December 31, 2025 compared to the prior year period primarily due to the higher interest rate on our Credit Facility relative to the rate on the Notes, which we repaid using $97.0 million of borrowings under the Credit Facility’s Revolver in the prior quarter, partially offset by a decrease in total debt outstanding. We expect interest expense to remain higher for the remainder of fiscal year 2026 compared to fiscal year 2025 as a result of the higher Credit Facility rate compared to the rate previously incurred on the Notes. For the nine months ended December 31, 2025, interest expense decreased compared to the prior year period due to lower weighted‑average levels of outstanding interest‑bearing debt and a reduction in interest rates applicable to our floating‑rate debt, partially offset by the higher rate on the Credit Facility compared to the Notes.

Other expense (income), net primarily consists of gains and losses on foreign currency transactions. In particular, during the nine months ended December 31, 2025, we recognized unrealized foreign currency gains of approximately $5.8 million related to an intercompany U.S. dollar-denominated loan issued in fiscal year 2024 to one of our wholly owned, euro-denominated subsidiaries.

The $2.9 million gain on extinguishment of the Notes reported in the first nine months of fiscal year 2025 was a result of the partial repurchase of the Notes during that period. No gain or loss was recognized upon final settlement of the Notes during the nine months ended December 31, 2025, as the Notes had reached maturity and were settled in cash at the contractual principal amount.

Page 19

Income Taxes

Our effective income tax rate was 21.0% and 20.3%, respectively, for the three and nine months ended December 21, 2025 compared to 24.4% and 6.5% for the comparable prior year periods. The effective tax rate for the three months ended December 31, 2025 approximated the federal statutory rate of 21%, but was impacted by the valuation allowance on U.S. deferred taxes, offset by the foreign differential rate. The effective tax rate for the nine months ended December 31, 2025 differed from the statutory federal rate of 21% due to the impact of the valuation allowance on U.S. deferred taxes, partially offset by the foreign rate differential.

The change in the effective tax rate for both the three and nine months ended December 31, 2025 versus the comparable prior year periods was primarily due to prior year valuation allowance adjustments related to our operations in Germany and an increase in German statutory taxes in the current fiscal year.

Our future effective income tax rate depends on various factors, such as changes in tax laws including OBBBA, regulations, accounting principles, or interpretations thereof, and the geographic composition of our pre-tax income. We carefully monitor these factors and adjust our effective income tax rate accordingly.

Net Income

Net income varies with changes in revenues, gross profit, operating expense, and currency exchange rate fluctuations. Net income included $13.5 million, $11.1 million and $4.0 million of non-cash amortization of intangible assets, stock-based compensation expense, and depreciation expense, respectively, for the nine months ended December 31, 2025.

Liquidity and Capital Resources

Our sources of liquidity include cash generated from operations, cash on hand, and cash available from borrowings under our Credit Facility. We believe these sources are sufficient to meet our ongoing operating needs, scheduled debt service obligations, dividend payments and anticipated capital expenditures. As of December 31, 2025 and March 31, 2025, we held $29.0 million and $27.3 million of cash, respectively.

Historically, our more significant uses of cash have included acquisitions, payments on debt principal and interest obligations, and quarterly dividends paid to shareholders.

Working capital, defined as the amount by which current assets exceed current liabilities, was $51.2 million as of December 31, 2025, compared to negative working capital of $(61.3) million as of March 31, 2025. The prior period's negative working capital was due to the classification of $97.5 million in principal related to our Notes as a current liability. During the nine months ended December 31, 2025, we settled the Notes using a draw of $97.0 million on the Revolver. The Revolver allows us to borrow up to $125.0 million, and $98.3 million was outstanding as of December 31, 2025. Subsequent to quarter end, we repaid $4.0 million on the Revolver.

On October 10, 2025 we amended our Credit Facility to reduce the applicable interest rate spread above the SOFR base rate from 1.5%-3.5% to 1.25%-2.5%, which we expect will reduce interest expense by approximately $0.4 million per year at current debt balances. We expect to incur approximately $10.2 million in cash interest expense over the next twelve months based on outstanding debt levels and the rate in effect as of December 31, 2025. Required principal debt payments due on our Term Loan within the next twelve months total $5.2 million.

We routinely evaluate opportunities for strategic acquisitions. Future material acquisitions may require us to obtain additional capital, assume third-party debt or incur other long-term obligations. We believe that we have the ability to issue more equity or debt in the future in order to finance our acquisition and investment activities; however, additional equity or debt financing, or other transactions, may not be available on acceptable terms, if at all.

Dividends

We have paid regular quarterly dividends since 2003. We paid dividends of $0.16 per share during the three months ended December 31, 2025, as well as each quarter of fiscal years 2026 and 2025.

In January 2026, we announced that our Board of Directors declared a quarterly cash dividend of $0.16 per share of common stock, payable on March 16, 2026, to shareholders of record at the close of business on February 28, 2026.

Goodwill Impairment Testing

We perform qualitative analyses at least quarterly to identify potential indicators of impairment and to assess whether it is more likely than not that any of our five goodwill reporting units (Sterilization and Disinfection Control, Immunoassays (BPD), Peptides (BPD), Calibration Solutions, and Clinical Genomics) are impaired. As of December 31, 2025, we concluded that there were no indicators of impairment for any of our reporting units. However, our Clinical Genomics reporting unit remains particularly sensitive to significant changes in key valuation assumptions, and therefore carries a heightened risk of future impairment losses. The valuation of our reporting units for impairment testing purposes requires significant management judgment and the use of unobservable Level 3 inputs, including discount rates, forecasted results for earnings before interest, taxes, depreciation and amortization (“EBITDA”), revenue growth rates, operating expense projections, the identification of comparable public entities, and applied market multiples.

We continue to monitor the impact of macroeconomic challenges and demand for our Clinical Genomics products and services in China. Depending on the persistence and magnitude of adverse factors, it is reasonably possible our Clinical Genomics reporting unit could incur impairment losses in the future. As of our most recent annual impairment test in the fourth quarter of fiscal year 2025, the estimated fair value of the Clinical Genomics reporting unit exceeded its carrying value by approximately 40%. As of December 31, 2025, the carrying values of goodwill and finite-lived intangible assets associated with our Clinical Genomics reporting unit were $17.1 million and $8.2 million, respectively.

Page 20

Cash Flows

Our cash flows from operating, investing and financing activities were as follows:

Cash flows from operating activities provided $28.9 million for the nine months ended December 31, 2025, a decrease of $5.3 million versus the comparable prior year period. The decrease in cash flows from operating activities was primarily a result of:

• higher cash payments in the first quarter of fiscal year 2026 to settle accrued bonuses and commissions from the end of fiscal year 2025; and
• increased inventory purchases, including for finished goods warehoused in international locations as part of our tariff mitigation strategy.

These uses of cash were partially offset by the timing and magnitude of cash paid for taxes and higher collections on accounts receivable, driven by increased revenues.

Cash used in investing activities decreased for the nine months ended December 31, 2025 versus the comparable prior year period as we invested in property, plant and equipment for our new leased facility in Sweden in the prior year. Cash used in financing activities resulted in a $26.1 million use of cash for the nine months ended December 31, 2025. We borrowed:

• $10.5 million under the Revolver, largely to fund a $9.6 million payment of the GKE acquisition-related holdback; and
• $97.0 million under the Revolver, to settle the Notes upon maturity in August 2025.

We repaid:

Recent Accounting Pronouncements

For a discussion of the new accounting standards impacting the Company, refer to Note 1. “Description of Business and Summary of Significant Accounting Policies” in Item I. Financial Statements (Unaudited).

Contractual Obligations and Other Commercial Commitments

We are party to contractual obligations that involve commitments to remit payments to third parties in the ordinary course of business. On a consolidated basis, as of December 31, 2025, we had contractual obligations for open purchase orders of approximately $11.9 million for routine purchases of supplies and inventory, of which the substantial majority are payable in less than one year.

See "Liquidity and Capital Resources" for information related to future required debt and other payments. For a description of our contractual obligations and other commercial commitments as of March 31, 2025, see our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

Critical Accounting Estimates

Critical accounting estimates are those that we consider both significant to the preparation of our financial statements and that require complex, subjective, or highly judgmental assessments. These estimates often involve assumptions about inherently uncertain matters and are based on our historical experience, as well as other factors we believe to be appropriate under the circumstances. For example, we incorporate expert input when developing estimates used in the valuation of reporting units for goodwill impairment testing. The accounting estimates that require significant management judgment and are deemed critical to our results of operations or financial position are discussed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025 in “Critical Accounting Policies and Estimates” in Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. While we believe our estimates, assumptions and judgements are reasonable, actual results may differ materially from these estimates.

Page 21

Non-GAAP Measures

In addition to financial measures prepared in accordance with generally accepted accounting principles, we present organic revenues growth, defined as reported revenues growth excluding revenues from recent acquisitions, as a supplemental non-GAAP financial measure. We believe this measure facilitates comparability between current and prior period information and provides insight into our short-term and long-term performance and growth trends. We use organic revenues growth internally for forecasting, evaluating operating performance, comparing current and historical revenue results, and informing financial and operating decision-making, including for compensation-setting purposes.

A reconciliation of organic revenues growth to total revenues growth is as follows:

I****tem 3. Quantitative and Qualitative Disclosures about Market Risk

For information regarding our exposure to certain market risks, see Part II, Item 7A, "Quantitative and Qualitative Disclosures About Market Risk," of our Annual Report on Form 10-K for the fiscal year ended March 31, 2025. There were no material changes to our market risk exposure during the three months ended December 31, 2025.

Item 4. Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Exchange Act) that are designed to ensure that information required to be disclosed in Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Evaluation of Disclosure Controls and Procedures

As of December 31, 2025, we conducted an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Control Over Financial Reporting

During the three months ended December 31, 2025, there have been no changes to our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that materially affected or are reasonably likely to materially affect our internal control over financial reporting.

Page 22

Part II. Other Information

Item 1. Legal Proceedings

See Note 10. “Commitments and Contingencies” within Item 1. Financial Statements for information regarding any legal proceedings in which we may be involved.

Item 1A. Risk Factors

During the three months ended December 31, 2025, there were no material changes from the risk factors described in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

I****tem 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

The following table provides information about the Company's purchases of equity securities for the periods indicated:

(1) Shares purchased during the period were transferred to the Company from employees in satisfaction of minimum tax withholding obligations associated with the vesting of restricted stock awards during the period.

(2) On November 7, 2005, our Board of Directors adopted a share repurchase plan which allows for the repurchase of up to 300,000 of our common shares; however, no shares have been purchased under the plan in any period presented herein. This plan will continue until the maximum is reached or the plan is terminated by further action of the Board of Directors.

Item 5. Other Information

During the three months ended December 31, 2025, none of our directors or officers entered into new or amended written plans for the purchase or sale of our securities intended to satisfy the affirmative defense conditions of Exchange Act Rule 10b5-1(c).

Page 23

Item 6. Exhibits

• Filed herewith

• Furnished herewith

Page 24

Signatures