Csw Industrials, Inc.

2 Excluding the aforementioned $16.8 million deferral of a cash tax payment in the prior year period, adjusted free cash flow, defined as cash flow from operations minus capital expenditures, was $58.7 million, compared to $45.1 million in the prior year period, an increase of $13.6 million or 30.2% primarily driven by increased profit.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Following quarter-end, the Company announced its twenty-seventh consecutive regular quarterly cash dividend in the amount of $0.27 per share, which will be paid on November 14, 2025, to shareholders of record on October 31, 2025.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

The acquisition will be funded with a new Term Loan A and borrowings under the Company's Revolving Credit Facility.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

The decrease of $1.5 million was a result of a lower debt balance throughout the first half of the year.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

The Company borrowed $135.0 million to fund the Aspen acquisition in May and paid down $75.0 million of debt in the first half, utilizing our cash flow from operations.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Free cash flow is a non-GAAP financial measure and is defined as cash flow from operations less capital expenditures.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Engineered Building Solutions segment revenue was $31.9 million, a 2.3% decrease compared to $32.7 million in the prior year period due to softness in the market and strategic pricing in response to competitive pressures.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

The reduction in operating income was driven by increased material costs and strategic pricing in response to competitive pressures.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Segment operating income decreased 25.2% to $8.8 million, or 13.8% of revenue, compared to the prior year period of $11.8 million, or 18.6% of revenue, driven primarily by increased material costs, higher warranty expenses and strategic pricing in response to competitive pressures.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Words or phrases such as may, should, expects, could, intends, plans, anticipates, estimates, believes, forecasts, predicts or other similar expressions are intended to identify forward-looking statements, which include, without limitation, earnings forecasts, effective tax rate, statements relating to our business strategy and statements of expectations, beliefs, future plans and strategies and anticipated developments concerning our industry, business, operations, and financial performance and condition.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

(the Company, CSW, we, our or us ) is a diversified industrial growth company with a strategic focus on providing niche, value-added products in the end markets we serve.

SEC original ↗Csw Industrials, Inc. — 10-Q Quarterly report10-QOct 29, 2026

Total revenue growth included $61.9 million or 27.2% inorganic growth contributed by acquisitions over the last twelve months, which are all reported within the Contractor Solutions segment, offset by a decrease in organic revenue of $12.9 million or 5.6% due mostly to headwinds in the residential HVAC R end market.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

The gross margin decrease was primarily a result of the inclusion of recent acquisitions and the inflation of some material costs, including the direct and indirect impact from tariffs, partially offset by pricing actions and favorable ocean freight costs.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Including pre-acquisition revenue effect from recent acquisitions, as if they had been owned by the Company during the same period in the prior year, our organic revenue growth would have been 2.8% in the current quarter, despite market headwinds.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

The incremental profit resulted from the inclusion of recently acquired businesses, pricing actions, and favorable ocean freight and was partially offset by the impact of lower organic sales and increased tariffs.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Segment operating income margin for the fiscal second quarter was 25.6%, or 26.3% adjusted, as compared to 29.1% in the prior year period primarily due to the gross margin impact of recent acquisitions on our overall profit margin and tariffs, offset somewhat by pricing actions and lower ocean freight costs.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025

Segment operating income margin for the fiscal second quarter was 13.1%, compared to the prior year period of 15.1% as a result of the escalation in material costs, indirectly driven by tariffs, as well 3 as increased freight costs to support incremental growth of international shipments.

SEC original ↗Csw Industrials, Inc. — Earnings release (8-K exhibit)EX-99Oct 30, 2025