Core Molding Technologies Inc 10-Q for FY2026 Q3
Core Molding Technologies Inc (CMT)
10-Q
2026-11-04
For: 2026-09-30
View Original
Added on
November 05, 2026
About this 10-Q
Core Molding Technologies Inc filed this 10-Q on November 4, 2026, covering the quarter ended September 30, 2026 (FY2026 Q3).
Headline figures
Quarter ended September 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $90.24M
- up 54.4% from $58.44M a year earlier
- Net income
- $1.51M
- down 19.4% from net income of $1.88M a year earlier
- Diluted EPS
- $0.17
- down 22.7% from $0.22 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
for the transition period from ____________ to
Commission File Number 001-12505
_______________________________________________________________
(Exact name of registrant as specified in its charter)
(State or other jurisdiction incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
(Address of principal executive office) | (Zip Code) | |||||||||||||
Registrant’s telephone number, including area code (614 ) 870-5000
N/A
__________________________________________________________
Former name, former address and former fiscal year, if changed since last report.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer,” “large accelerated filer,” and “smaller reporting company,” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ¨ | Non-accelerated Filer ¨ | Smaller reporting company | |||||||||||||||||||||
Emerging growth company | |||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act. Yes ☐ No ☒
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Name of each exchange on which registered | Trading Symbol | ||||||||||||||||||
As of November 2, 2026, the latest practicable date, 8,840,623 shares of the registrant’s common stock were issued, which includes 285,735 shares of unvested restricted common stock.
Table of Contents
2
Part I — Financial Information
Item 1. Financial Statements
Core Molding Technologies, Inc. and Subsidiaries
Consolidated Statements of Operations
(In thousands, except for per share data)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Net production revenue | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Net tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total net revenue | |||||||||||||||||||||||||||||||||||
| Cost of revenue | |||||||||||||||||||||||||||||||||||
| Gross margin | |||||||||||||||||||||||||||||||||||
| Selling, general and administrative expense | |||||||||||||||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||||||||||||||
| Other income and expense | |||||||||||||||||||||||||||||||||||
| Net interest expense | |||||||||||||||||||||||||||||||||||
| Net periodic post-retirement benefit | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Total other income | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Income before taxes | |||||||||||||||||||||||||||||||||||
| Income tax expense | |||||||||||||||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Net income per share of common stock: | |||||||||||||||||||||||||||||||||||
| Basic | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Diluted | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
See notes to unaudited consolidated financial statements.
3
Core Molding Technologies, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(In thousands)
(Unaudited)
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Other comprehensive income: | |||||||||||||||||||||||||||||||||||
| Foreign currency hedging derivatives: | |||||||||||||||||||||||||||||||||||
| Unrealized hedge gain (loss) | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Net of tax expense | ( | ||||||||||||||||||||||||||||||||||
| Interest rate swaps: | |||||||||||||||||||||||||||||||||||
| Unrealized hedge loss | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Net of tax benefit | |||||||||||||||||||||||||||||||||||
| Post-retirement benefit plan adjustments: | |||||||||||||||||||||||||||||||||||
| Amortization of net actuarial gain | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Amortization of prior service credits | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Net tax benefit | |||||||||||||||||||||||||||||||||||
| Comprehensive income (loss) | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||
See notes to unaudited consolidated financial statements.
4
Core Molding Technologies, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands, except for share data)
| September 30, 2026 | December 31, 2025 | ||||||||||
| (Unaudited) | |||||||||||
| Assets: | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Accounts receivable, net | |||||||||||
| Inventories, net | |||||||||||
| Foreign tax receivable | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Right of use asset | |||||||||||
| Property, plant and equipment, net | |||||||||||
| Goodwill | |||||||||||
| Intangibles, net | |||||||||||
| Other non-current assets | |||||||||||
| Total Assets | $ | $ | |||||||||
| Liabilities and Stockholders’ Equity: | |||||||||||
| Current liabilities: | |||||||||||
| Revolving debt | $ | $ | |||||||||
| Current portion of long term debt | |||||||||||
| Accounts payable | |||||||||||
| Contract liability | |||||||||||
| Compensation and related benefits | |||||||||||
| Accrued other liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Other non-current liabilities | |||||||||||
| Lease liabilities | |||||||||||
| Long-term debt | |||||||||||
| Post-retirement benefits liability | |||||||||||
| Total Liabilities | |||||||||||
| Commitments and Contingencies | |||||||||||
| Stockholders’ Equity: | |||||||||||
Preferred stock — $ | |||||||||||
| Paid-in capital | |||||||||||
| Accumulated other comprehensive income, net of income taxes | |||||||||||
Treasury stock - at cost, | ( | ( | |||||||||
| Retained earnings | |||||||||||
| Total Stockholders’ Equity | |||||||||||
| Total Liabilities and Stockholders’ Equity | $ | $ | |||||||||
See notes to unaudited consolidated financial statements.
5
Core Molding Technologies, Inc. and Subsidiaries
Consolidated Statement of Stockholders’ Equity
(In thousands, except for share data)
(Unaudited)
For the three months ended September 30, 2025:
| Common Stock Outstanding | Paid-In Capital | Accumulated Other Comprehensive Income | Treasury Stock | Retained Earnings | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
| Net income | |||||||||||||||||||||||||||||||||||||||||
Change in post-retirement benefits, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
Change in foreign currency hedge, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
Change in interest rate swaps, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Restricted stock vested | |||||||||||||||||||||||||||||||||||||||||
| Share-based compensation | |||||||||||||||||||||||||||||||||||||||||
| Unvested equity awards transition to liability accounting | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
For the nine months ended September 30, 2025:
| Common Stock Outstanding | Paid-In Capital | Accumulated Other Comprehensive Income | Treasury Stock | Retained Earnings | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
| Net income | |||||||||||||||||||||||||||||||||||||||||
Change in post-retirement benefits, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
Change in foreign currency hedge, net of tax of $ | |||||||||||||||||||||||||||||||||||||||||
Change in interest rate swaps, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Restricted stock vested | |||||||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock related to net settlement of equity awards | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
| Share-based compensation | |||||||||||||||||||||||||||||||||||||||||
| Unvested equity awards transition to liability accounting | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
6
For the three months ended September 30, 2026:
| Common Stock Outstanding | Paid-In Capital | Accumulated Other Comprehensive Income | Treasury Stock | Retained Earnings | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
| Net income | |||||||||||||||||||||||||||||||||||||||||
Change in post-retirement benefits, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
Change in foreign currency hedge, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||
| Share-based compensation | |||||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
For the nine months ended September 30, 2026:
| Common Stock Outstanding | Paid-In Capital | Accumulated Other Comprehensive Income | Treasury Stock | Retained Earnings | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
| Net income | |||||||||||||||||||||||||||||||||||||||||
Change in post-retirement benefits, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
Change in foreign currency hedge, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
Change in interest rate swaps, net of tax of $ | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Restricted stock vested | |||||||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock related to net settlement of equity awards | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||
| Share-based compensation | |||||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||
See notes to unaudited consolidated financial statements.
7
Core Molding Technologies, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
| Nine months ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Loss on disposal of property, plant and equipment | |||||||||||
| Share-based compensation | |||||||||||
| (Gains) on foreign currency remeasurement | ( | ( | |||||||||
| Change in operating assets and liabilities: | |||||||||||
| Accounts receivable | ( | ( | |||||||||
| Inventories | ( | ( | |||||||||
| Prepaid and other assets | ( | ( | |||||||||
| Accounts payable | |||||||||||
| Accrued and other liabilities | ( | ||||||||||
| Post-retirement benefits liability | ( | ( | |||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Purchase of property, plant and equipment | ( | ( | |||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
| Gross repayments on revolving line of credit | ( | ||||||||||
| Gross borrowings on revolving line of credit | |||||||||||
| Payments for taxes related to net share settlement of equity awards | ( | ( | |||||||||
| Purchase of treasury stock | ( | ( | |||||||||
| Payment of principal on term loans | ( | ( | |||||||||
| Net cash used in financing activities | ( | ( | |||||||||
| Net change in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | |||||||||
| Cash paid for: | |||||||||||
| Interest | $ | $ | |||||||||
| Income taxes | $ | $ | |||||||||
| Non-cash investing activities: | |||||||||||
| Fixed asset purchases in accounts payable | $ | $ | |||||||||
See notes to unaudited consolidated financial statements.
8
Core Molding Technologies, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and include all of the information and disclosures required by accounting principles generally accepted in the United States of America for interim reporting, which are less than those required for annual reporting. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (all of which are normal and recurring in nature) necessary to present fairly the financial position of Core Molding Technologies, Inc. and its subsidiaries (“Core Molding Technologies” or the “Company”) at September 30, 2026, and the results of operations and cash flows for the nine months ended September 30, 2026. The “Notes to Consolidated Financial Statements” contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, should be read in conjunction with these consolidated financial statements.
2. CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Principles of Consolidation: Management believes the following critical accounting policies, among others, affect its more significant judgments and estimates used in the preparation of its consolidated financial statements.
Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, and reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions and conditions.
Revenue Recognition: The Company historically has recognized revenue from two streams, product revenue and tooling contract revenue. Product revenue is earned from the manufacture and sale of sheet molding compounds and thermoset and thermoplastic products. Product revenue is generally recognized when products are shipped, as the Company transfers control to the customer and is entitled to payment upon shipment.
Tooling Project revenue is earned from manufacturing multiple tools, molds and assembly equipment as part of a tooling program for a customer. Given that the Company is providing a significant service of producing highly interdependent component parts of the tooling program, each tooling program consists of a single performance obligation to provide the customer the capability to produce a single product. Based on the arrangement with the customer, the Company recognizes revenue either at a point in time or over a given period. When the Company does not have an enforceable right to payment, the Company recognizes tooling project revenue at a point in time. In such cases, the Company recognizes revenue upon customer acceptance, which is when the customer has legal title to the tools.
Certain tooling programs include an enforceable right to payment. In those cases, the Company recognizes revenue over time based on the extent of progress towards completion of its performance obligation. The Company uses a cost-to-cost measure of progress for such contracts because it best depicts the transfer of value to the customer and also correlates with the amount of consideration to which the entity expects to be entitled in exchange for transferring the promised goods or services to the customer. Under the cost-to-cost measure of progress, progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred.
Cash and Cash Equivalents: The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash is held primarily in four banks in three separate countries. The Company had $5,437,000 cash on hand at September 30, 2026 and had $38,058,000 cash on hand at December 31, 2025.
9
Accounts Receivable Allowances: Management maintains allowances for credit losses resulting from the inability of its customers to make required payments. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. The Company has determined that $130,000 and $58,000 allowance for credit losses was needed at September 30, 2026 and December 31, 2025, respectively. Management also records estimates for customer returns and deductions, discounts offered to customers, and for price adjustments. Should customer returns and deductions, discounts, and price adjustments fluctuate from the estimated amounts, additional allowances may be required. The Company had an allowance for estimated chargebacks of $364,000 at September 30, 2026 and $212,000 at December 31, 2025. There have been no material changes in the methodology of these calculations.
Inventories: Inventories, which include material, labor and manufacturing overhead, are valued at the lower of cost or net realizable value. The inventories are accounted for using the first-in, first-out (FIFO) method of determining inventory costs. Inventory quantities on-hand are regularly reviewed, and where necessary, provisions for excess and obsolete inventory are recorded based on historical and anticipated usage. The Company has recorded an allowance for slow moving and obsolete inventory of $1,147,000 at September 30, 2026 and $1,137,000 at December 31, 2025.
Contract Assets/Liabilities: Contract assets and liabilities represent the net cumulative customer billings, vendor payments and revenue recognized for tooling programs. For tooling programs where net revenue recognized and vendor payments exceed customer billings, the Company recognizes a contract asset. For tooling programs where net customer billings exceed revenue recognized and vendor payments, the Company recognizes a contract liability. Customer payment terms vary by contract and can range from progress payments based on work performed or one single payment once the contract is completed. The Company has recorded contract assets of $3,302,000 at September 30, 2026, and $59,000 at December 31, 2025. Contract assets are classified as current within prepaid expenses and other current assets on the Consolidated Balance Sheets. For the nine months ended September 30, 2026 and September 30, 2025, the Company recognized no impairments on contract assets. For the nine months ended September 30, 2026, the Company recognized $26,023,857 of revenue from contract liabilities related to open jobs outstanding as of December 31, 2025. During the third quarter of 2026, the Company amended contractual terms related to the Volvo tooling program, including the termination provisions applicable to the arrangement. As a result of the amendment, the Company recognized approximately $22 million in revenue during the quarter.
Income Taxes: The Company evaluates the balance of deferred tax assets that will be realized based on the premise that the Company is more-likely-than-not to realize deferred tax benefits through the generation of future taxable income.
Long-Lived Assets: Long-lived assets consist primarily of property, plant and equipment and definite-lived intangibles. The recoverability of long-lived assets is evaluated by an analysis of operating results and consideration of other significant events or changes in the business environment. The Company evaluates whether impairment exists for property, plant and equipment on the basis of undiscounted expected future cash flows from operations before interest. There were no impairment charges of the Company’s long-lived assets for the nine months ended September 30, 2026 and 2025, respectively.
Goodwill: The purchase consideration of acquired businesses has been allocated to the assets and liabilities acquired based on the estimated fair values on the respective acquisition dates. Based on these values, the excess purchase consideration over the fair value of the net assets acquired was allocated to goodwill. The Company accounts for goodwill in accordance with FASB ASC Topic 350, Intangibles - Goodwill and Other. FASB ASC Topic 350 prohibits the amortization of goodwill and requires these assets be reviewed for impairment.
The annual impairment tests of goodwill may be completed through qualitative assessments; however, the Company may elect to bypass the qualitative assessment and proceed directly to a quantitative impairment test for any period. The Company may resume the qualitative assessment in any subsequent period.
Under a qualitative and quantitative approach, the impairment test for goodwill consists of an assessment of whether it is more-likely-than-not that the fair value is less than its carrying amount. As part of the qualitative assessment, the Company considers relevant events and circumstances that affect the fair value or carrying amount of the Company. Such events and circumstances could include changes in economic conditions, industry and market conditions, cost factors, overall financial performance, and capital markets pricing. The Company places more weight on the events and circumstances that most affect the Company's fair value or carrying amount. These factors are all considered by management in reaching its conclusion about whether to perform step one of the impairment test. If the Company elects to bypass the qualitative assessment, or if a qualitative assessment indicates it is more-likely-than-not that the estimated carrying value exceeds its fair value, the Company proceeds to a quantitative approach. There were no impairment charges of the Company's goodwill for the nine months ended September 30, 2026 and 2025, respectively.
10
Self-Insurance: The Company is self-insured with respect to its facilities in Columbus, Ohio; Gaffney, South Carolina; Winona, Minnesota; and Brownsville, Texas for medical, dental and vision claims and Columbus, Ohio for workers’ compensation claims, all of which are subject to stop-loss insurance thresholds. The Company is also self-insured for dental and vision with respect to its Cobourg, Canada location. The Company has recorded an estimated liability for self-insured medical, dental and vision claims incurred but not reported and worker’s compensation claims incurred but not reported at September 30, 2026 and December 31, 2025 of $942,000 and $845,000 , respectively. Estimated liabilities for self-insurance are classified as current within accrued other liabilities on the Consolidated Balance Sheets.
Post-Retirement Benefits: Management records an accrual for post-retirement costs associated with the health care plan sponsored by Core Molding Technologies. Should actual results differ from the assumptions used to determine the reserves, additional provisions may be required. In particular, increases in future healthcare costs above the assumptions could have an adverse effect on Core Molding Technologies’ operations. The effect of a change in healthcare costs is described in Note 9, "Post Retirement Benefits", of the Notes to Consolidated Financial Statements contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Core Molding Technologies had a liability for post-retirement healthcare benefits based on actuarial computed estimates of $3,391,000 at September 30, 2026 and $3,287,000 at December 31, 2025.
3. NET INCOME PER SHARE OF COMMON STOCK
Net income per share of common stock is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted net income per share of common stock is computed similarly but includes the effect of the assumed exercise of dilutive restricted stock under the treasury stock method.
The computation of basic and diluted net income per share of common stock (in thousands, except for per share data) is as follows:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Weighted average common shares outstanding — basic | |||||||||||||||||||||||||||||||||||
| Effect of weighted average dilutive securities | |||||||||||||||||||||||||||||||||||
| Weighted average common and potentially issuable shares of common stock outstanding — diluted | |||||||||||||||||||||||||||||||||||
| Basic net income per share of common stock | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Diluted net income per share of common stock | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
11
4. MAJOR CUSTOMERS
The Company had four major customers during the nine months ended September 30, 2026, BRP, Inc. ("BRP"), International Motors, LLC (“International”), PACCAR, Inc. ("PACCAR") and Volvo Group North America, LLC ("Volvo"). Major customers are defined as customers whose revenue individually consist of more than ten percent of the Company's total revenue during any annual or interim reporting period presented. The loss of a significant portion of revenue to these customers could have a material adverse effect on the Company.
The following table presents sales revenue for the above-mentioned customers for the three and nine months ended September 30, 2026 and 2025 (in thousands):
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| BRP product revenue | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| BRP tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total BRP revenue | |||||||||||||||||||||||||||||||||||
| International product revenue | |||||||||||||||||||||||||||||||||||
| International tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total International revenue | |||||||||||||||||||||||||||||||||||
| PACCAR product revenue | |||||||||||||||||||||||||||||||||||
| PACCAR tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total PACCAR revenue | |||||||||||||||||||||||||||||||||||
| Volvo product revenue | |||||||||||||||||||||||||||||||||||
| Volvo tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total Volvo revenue | |||||||||||||||||||||||||||||||||||
| Other product revenue | |||||||||||||||||||||||||||||||||||
| Other tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total other revenue | |||||||||||||||||||||||||||||||||||
| Total product revenue | |||||||||||||||||||||||||||||||||||
| Total tooling project revenue | |||||||||||||||||||||||||||||||||||
| Total revenue | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
12
5. INVENTORY
Inventories, net consisted of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
Raw materials | $ | $ | |||||||||
Work in process | |||||||||||
Finished goods | |||||||||||
Total | $ | $ | |||||||||
6. LEASES
The Company has operating leases with fixed payment terms for certain buildings and warehouses. The Company's leases have remaining lease terms of less than one year to ten years , some of which include options to extend the lease for five years . Operating leases are included in operating lease right-of-use ("ROU") assets, accrued other liabilities and other non-current liabilities in the Consolidated Balance Sheets. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease.
The Company used the applicable incremental borrowing rate at implementation date to measure lease liabilities and ROU assets. The incremental borrowing rate used by the Company was based on baseline rates and adjusted by the credit spreads commensurate with the Company’s secured borrowing rate. At each reporting period when there is a new lease initiated, the Company will utilize its incremental borrowing rate to perform lease classification tests on lease components and to measure ROU assets and lease liabilities.
The components of lease expense were as follows (in thousands):
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Operating lease cost | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Short-term lease cost | |||||||||||||||||||||||||||||||||||
| Total net lease cost | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Other supplemental balance sheet information related to leases was as follows (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Operating lease right-of-use assets | $ | $ | |||||||||
Current operating lease liabilities(A) | $ | $ | |||||||||
Noncurrent operating lease liabilities(B) | |||||||||||
| Total operating lease liabilities | $ | $ | |||||||||
(A)Current operating lease liabilities are included in in the Consolidated Balance Sheets.
(B)Noncurrent operating lease liabilities are included in other non-current liabilities in the Consolidated Balance Sheets.
During the nine months ended September 30, 2026, the Company entered into a renewed lease related to the Matamoros production facility, which resulted in a right-of-use asset of $1,260,000 in exchange for new operating lease liabilities.
13
7. PROPERTY, PLANT & EQUIPMENT
Property, plant and equipment, net consisted of the following for the periods specified (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Property, plant and equipment | $ | $ | |||||||||
| Accumulated depreciation | ( | ( | |||||||||
| Property, plant and equipment — net | $ | $ | |||||||||
Property, plant, and equipment are recorded at cost, unless obtained through acquisition, then assets are recorded at estimated fair value at the date of acquisition. Depreciation is provided on a straight-line method over the estimated useful lives of the assets. The carrying amount of long-lived assets is evaluated annually to determine if an adjustment to the depreciation period or to the unamortized balance is warranted. Depreciation expense for the three months ended September 30, 2026 and 2025 was $2,284,000 and $2,865,000 , respectively. Depreciation expense for the nine months ended September 30, 2026 and 2025 was $7,928,000 and $8,722,000 , respectively. Amounts invested in capital additions in progress were $27,984,000 at September 30, 2026, which $19,978,000 related to Mexico expansion project. Amounts invested in capital additions in process at December 31, 2025 were $13,549,000 , which $6,415,000 related to the Mexico expansion project. At September 30, 2026 and December 31, 2025, purchase commitments for capital expenditures in progress were $7,544,377 and $13,766,000 , respectively.
8. GOODWILL AND INTANGIBLES
Goodwill activity for the nine months ended September 30, 2026 consisted of the following (in thousands):
| Balance at December 31, 2025 | $ | ||||
| Additions | |||||
| Impairment | |||||
| Balance at September 30, 2026 | $ | ||||
Intangibles, net at September 30, 2026 were comprised of the following (in thousands):
| Definite-lived Intangible Assets | Amortization Period | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
| Trade name | $ | $ | ( | $ | |||||||||||||||||||
| Trademarks | ( | ||||||||||||||||||||||
| Customer relationships | ( | ||||||||||||||||||||||
| Total | $ | $ | ( | $ | |||||||||||||||||||
Intangibles, net at December 31, 2025 were comprised of the following (in thousands):
| Definite-lived Intangible Assets | Amortization Period | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
| Trade name | $ | $ | ( | $ | |||||||||||||||||||
| Trademarks | ( | ||||||||||||||||||||||
| Customer relationships | ( | ||||||||||||||||||||||
| Total | $ | $ | ( | $ | |||||||||||||||||||
The aggregate intangible asset amortization expense was $228,000 for both the three months ended September 30, 2026 and 2025, respectively. The aggregate intangible amortization expense was $686,000 and $722,000 for the nine months ended September 30, 2026 and 2025, respectively.
14
9. POST-RETIREMENT BENEFITS
The components of expense for the Company’s post-retirement benefit plans are as follows (in thousands):
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Pension expense: | |||||||||||||||||||||||||||||||||||
Multi-employer plan | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Defined contribution plan | |||||||||||||||||||||||||||||||||||
| Total pension expense | |||||||||||||||||||||||||||||||||||
| Health and life insurance: | |||||||||||||||||||||||||||||||||||
Interest cost | |||||||||||||||||||||||||||||||||||
| Amortization of prior service credits | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Amortization of net gain | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Net periodic benefit credit | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
| Total post-retirement benefits expense | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
The Company made payments of $1,110,000 to pension plans and $94,000 for post-retirement healthcare and life insurance during the nine months ended September 30, 2026. For the remainder of 2026, the Company expects to make approximately $335,000 of pension plan payments, of which $143,000 was accrued at September 30, 2026. The Company also expects to make approximately $46,000
10. DEBT
Debt consists of the following (in thousands):
| September 30, 2026 | December 31, 2025 | ||||||||||
| Huntington term loans payable | $ | $ | |||||||||
| Huntington Revolving debt | |||||||||||
| Total | |||||||||||
| Less deferred loan costs | ( | ||||||||||
| Less current portion | ( | ||||||||||
| Long-term debt | $ | $ | |||||||||
Huntington Credit Agreement
On July 22, 2022, the Company entered into a credit agreement (as amended effective March 7, 2024, December 31, 2025, and July 2, 2026, the "Huntington Credit Agreement") with The Huntington National Bank ("Huntington"), as the sole lender, administrative agent, lead arranger and book runner, and the lenders from time to time thereto. Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company secured loans (the "Huntington Loans") in the maximum aggregate principal amount of $100,000,000 , comprised of two $50,000,000 commitments: a delayed draw term loan commitment and revolving loan commitment.
Under the July 2, 2026 Third Amendment to Credit Agreement (the "Third Amendment"), the Company repaid its existing term loan in full, replaced its capital expenditure loan commitment with the delayed draw loan facility, increased the revolving loan commitment from $25,000,000 to $50,000,000 and extended the maturity date of the facilities from July 22, 2027, to July 2, 2031.
At the option of the Company, the Huntington Loans shall be comprised of Alternative Base Rate (ABR) Loans or Secure Overnight Financing Rate (SOFR) Loans.
ABR Loans bear interest at a per annum rate equal to ABR plus a margin of 225 to 300 basis points determined based on the Company's margin leverage ratio. ABR is the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Rate in effect on such day plus 0.50 % per annum and (c) Daily Simple SOFR for such day (taking into account any floor set forth in the
15
definition of "Daily Simple SOFR") plus 1.00 % annum; provided, that if ABR shall be less than 0.00 %, then ABR shall be deemed to be 0.00 %.
SOFR Loans bear interest at a per annum rate equal to Daily Simple SOFR plus a margin of 125 to 200 basis points determined based on the Company’s margin leverage ratio, which is defined as consolidated funded indebtedness less unrestricted cash held with Huntington, divided by consolidated EBITDA for the most recently completed four fiscal quarters. As of the Third Amendment effective date, pricing was set at Level I. Daily Simple SOFR means, for any day (a “SOFR Rate Day”), a rate per annum equal to the greater of (a) SOFR for the day (such day, the “SOFR Determination Date”) that is five (5) U.S. Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator’s Website, and (b) 0.00 %.
The Company’s obligations under the Huntington Credit Agreement are secured by substantially all of its U.S. and Canadian assets, including its equity interests in its U.S. and Canadian subsidiaries and 65 % of its equity interests in its Mexican subsidiaries, and are unconditionally guaranteed by certain subsidiaries of the Company.
The Huntington Credit Agreement contains customary affirmative and negative covenants and events of default. The financial covenants require the Company to maintain a covenant leverage ratio not exceeding 3.00 to 1.00 and a fixed charge coverage ratio of at least 1.20 to 1.00. Capital expenditures are limited to $35,000,000 for fiscal 2026 and $30,000,000 for each fiscal year thereafter. As of September 30, 2026, the Company was in compliance with these covenants. Outstanding borrowings may be prepaid without premium or penalty.
Huntington Delayed Draw Loan
Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company a secured delayed draw loan commitment (the "Huntington Delayed Draw Loan") in the maximum aggregate principal amount of $50,000,000 of which none was outstanding as of September 30, 2026. Proceeds of the Huntington Delayed Draw Loan shall be used for the consummation of acquisitions permitted under the Huntington Credit Agreement.
Borrowings under the Huntington Delayed Draw Loan convert to term loans on July 1, 2028, July 1, 2029, July 1, 2030 or July 2, 2031, based on the availability period in which the borrowing was drawn. Except for borrowings converting on July 2, 2031, monthly principal installments are payable on the tenth day of each calendar month following the applicable conversion date, based on 0.2 % of the principal amount converted during each of the first and second calendar years after conversion, 0.4 % during each of the third and fourth calendar years, and 0.6 % during the fifth calendar year, in each case subject to maturity. Borrowings converting on July 2, 2031 and all remaining outstanding principal are due in full on July 2, 2031.
Huntington Revolving Loan
Pursuant to the terms of the Huntington Credit Agreement, Huntington provides for a revolving loan commitment (the “Huntington Revolving Loan”) in the maximum amount of $50,000,000 , under which the Company may borrow at their option at any time during the five-year period following the closing of the Third Amendment (July 2, 2031). As of September 30, 2026, $4,810,000 million was outstanding and $45,190,000 was available under the revolving loan facility. No revolving loan borrowings were outstanding as of December 31, 2025. The revolving loan commitment terminates, and all outstanding borrowings thereunder must be repaid, on July 2, 2031.
The interest rate for the Huntington Revolving Loan was 5.15 % and 5.46 % as of September 30, 2026, and December 31, 2025, respectively.
16
11. INCOME TAXES
The Company evaluates the balance of deferred tax assets that will be realized based on the premise that the Company is more-likely-than-not to realize deferred tax benefits through the generation of future taxable income. Management makes assumptions, judgments, and estimates to determine the deferred tax assets and liabilities. The Company evaluates provisions and deferred tax assets quarterly to determine if adjustments to our valuation allowance are required based on the consideration of all available evidence.
At September 30, 2026 and December 31, 2025, the Company had a net deferred tax asset of $1,402,000 221,000 1,035,000 1,327,000 , against deferred tax assets related to local (city) jurisdiction tax positions, due to cumulative losses over the last three years and uncertainty related to the Company's ability to realize the deferred assets. The Company believes that the net deferred tax assets associated with the Mexican, and Canadian tax jurisdictions are more-likely-than-not to be realizable based on estimates of future taxable income.
Income tax expense for the nine months ended September 30, 2026 is estimated to be $914,000 , approximately 19.0 % of income before income taxes. Income tax expense for the nine months ended September 30, 2025 was estimated to be $2,840,000 , approximately 25.9 % of income before income taxes.
The Company files income tax returns in the United States, Mexico, Canada and various state and local jurisdictions. The Company is not subject to United States federal income tax examinations for years before 2021. The Company is not subject to state income tax examinations for years before 2021. The Company is not subject to Mexican income tax examinations for years before 2019 and is not subject to Canadian income tax examinations for years before 2020.
12. STOCK BASED COMPENSATION
On May 13, 2021, the Company’s stockholders approved the 2021 Long Term Equity Incentive Plan and approved amendments on May 16, 2024, May 15, 2025 and May 14, 2026 (as amended, the "2021 Plan"). The 2021 Plan allows for grants to employees, officers, non-employee directors, consultants, independent contractors and advisors of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, and other stock-based awards (“stock awards”) up to an aggregate of 1,954,823 shares for issuance. At September 30, 2026, 944,854 shares of common stock were available for issuance under the 2021 Plan. Awards can be granted under the 2021 Plan through the earlier of May 13, 2031, or the date the maximum number of available shares under the 2021 Plan have been granted.
Awards under the 2021 Plan vest over to three years . Shares granted under the 2021 Plans vest immediately upon the date of a participant’s death, disability or change in control.
The Company follows the provisions of FASB ASC 718 requiring that compensation cost relating to share-based payment transactions be recognized in the financial statements. The cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employee's requisite service period (generally the vesting period of the equity award).
During the nine months ended September 30, 2026 employees withheld 31,907 shares of the Company's common stock to satisfy income withholding obligations in connection with the vesting of restricted stock awards, and in the same period in 2025 the Company withheld 40,953 shares.
17
Restricted Stock
The Company grants shares of its common stock to certain directors, officers, key managers and employees in the form of unvested stock and units (“Restricted Stock”). These awards are measured at the fair value of the Company's common stock on the date of issuance and recognized ratably as compensation expense over the applicable vesting period, which is typically three years . The Company adjusts compensation expense for actual forfeitures, as they occur.
The following summarizes the status of Restricted Stock and changes during the nine months ended September 30, 2026:
| Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
| Unvested balance at December 31, 2025 | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
| Forfeited | ( | ||||||||||
| Unvested balance at September 30, 2026 | $ | ||||||||||
At September 30, 2026 and 2025, there was $2,366,000 and $1,937,000 , respectively, of total unrecognized compensation expense, related to Restricted Stock grants. The unrecognized compensation expense at September 30, 2026 is expected to be recognized over the weighted-average period of 2.3 years. Total compensation cost related to Restricted Stock grants for the three months ended September 30, 2026 and 2025 was $443,000 and $400,000 , respectively. Total compensation cost related to Restricted Stock grants for the nine months ended September 30, 2026 and 2025 was $1,306,000 and $1,387,000 , respectively, all of which was recorded to selling, general and administrative expense.
Performance Restricted Stock Awards
The Company grants shares of its common stock to certain officers and key managers in the form of shares of performance-based restricted stock ("Performance Restricted Stock Awards"). These awards are measured at the fair value of the Company's common stock on the date of issuance and recognized ratably as compensation expense over the applicable vesting period to the extent that the performance measures have been satisfied as of the last day of the performance period of the award. The total amount payable as of the award's vesting date is determined by the three year average Operational Income and Return on Capital Employed performance measure achievement. The Company adjusts compensation expense for actual forfeitures as they occur, and for estimated performance measure achievement.
The following summarizes the status of Performance Restricted Stock Awards and changes during the nine months ended September 30, 2026:
| Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
| Unvested balance at December 31, 2025 | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
| Forfeited | ( | ||||||||||
| Unvested balance at September 30, 2026 | $ | ||||||||||
At September 30, 2026 and 2025, there was $731,000 and $931,000 of total unrecognized compensation expense related to Performance Restricted Stock Awards, respectively. The unrecognized compensation expense at September 30, 2026 is expected to be recognized over the weighted-average period of 2.2 years. Total compensation cost related to Performance Restricted Stock Awards for the three months ended September 30, 2026 and 2025 was $84,000 and $121,000 , respectively. Total compensation cost related to Performance Restricted Stock grants for the nine months ended September 30, 2026 and 2025 was $217,000 and $259,000 , respectively, all of which was recorded to selling, general and administrative expense.
Due to award modification as a part of the Executive Transition announced on August 1, 2025, the Company reclassified 28,744 restricted stock awards and 29,704 performance restricted stock awards to liability-classified awards. This
18
reclassification reduced Paid-in Capital by $45,000 for the years ended December 31, 2025. These awards are measured at the fair value of the Company’s common stock on the modification date and are marked to market at each reporting period. Compensation expense is recognized over the service period of ten months which concluded on May 31, 2026.
13. LONG TERM INCENTIVE COMPENSATION
The Company grants phantom stock ("Phantom Stock Awards") to key employees under the 2021 Plan. These Phantom Stock Awards are measured based on the fair value of the Company's common stock on the vesting date and are marked to market at each reporting period. Compensation expense is recognized over the applicable vesting period, typically three years , and is adjusted for actual forfeitures as they occur.
At September 30, 2026 there was $944,000 of total unrecognized compensation expense related to Phantom Stock Awards. At September 30, 2025 there was $688,000 unrecognized compensation expense related to Phantom Stock Awards. The unrecognized compensation expense at September 30, 2026 is expected to be recognized over the weighted-average period of 2.4 97,000 and $72,000 , respectively. Total compensation cost related to Phantom Stock Awards for the nine months ended September 30, 2026 and 2025 was $240,000 and $136,000 , respectively, all of which was recorded to selling, general and administrative expense.
14. STOCK REPURCHASE PLAN
On March 11, 2024, the Company announced that its Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $7,500,000 of its outstanding shares of common stock. On March 11, 2026, the Company announced that its Board of Directors approved an increase to the program, authorizing the repurchase of up to an additional approximately $6,500,000 of its outstanding common stock. As of September 30, 2026, the Company is authorized to repurchase $7,239,000 of its stocks. Repurchases of shares of common stock under the stock repurchase program are made in the open market and in accordance with applicable securities laws. Repurchases of shares of common stock under the stock repurchase program are made in the open market and in accordance with applicable securities laws. The stock repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be suspended or terminated at any time at the Company’s discretion. There were 8,411 shares repurchased under the repurchase program during the three months ended September 30, 2026. There were 32,956 shares repurchased under the repurchase program during the nine months ended September 30, 2026, totaling $648,000 .
15. FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in a transaction between market participants as of the measurement date. Fair value is measured using the fair value hierarchy and related valuation methodologies as defined in the authoritative literature. This hierarchical valuation methodology provides a fair value framework that describes the categorization of assets and liabilities in three levels based upon the assumptions (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment.
The three levels are defined as follows:
Level 1 - Quoted prices in active markets for identical assets and liabilities.
Level 2 - Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets.
Level 3 -Significant unobservable inputs reflecting management's own assumptions about the inputs used in pricing the asset or liability.
The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, debt, interest rate swaps and foreign currency derivatives. Cash and cash equivalents, accounts receivable and accounts payable carrying values as of September 30, 2026 and December 31, 2025 approximate fair value due to the short-term maturities of these financial instruments. As of September 30, 2026 did not have an outstanding term loan. As of December 31, 2025, the carrying amounts of the Huntington Term Loan approximated fair value due to the short-term nature of the underlying variable rate
19
SOFR used to determine interest charged on the loans. The Company had Level 2 fair value measurements at September 30, 2026 relating to the Company’s foreign currency derivatives.
Derivative and hedging activities
Foreign Currency Derivatives
The Company conducted business in foreign countries and paid certain expenses in foreign currencies; therefore, the Company was exposed to foreign currency exchange risk between the U.S. Dollar and foreign currencies, which could impact the Company’s operating income and cash flows. To mitigate risk associated with foreign currency exchange, the Company entered into forward contracts to exchange a fixed amount of U.S. Dollars for a fixed amount of foreign currency, which will be used to fund future foreign currency cash flows. At inception, all forward contracts are formally documented as cash flow hedges and are measured at fair value each reporting period.
Interest Rate Swap
The Company previously entered into an interest rate swap contract to fix the interest rate on an initial aggregate amount of $25,000,000 thereby reducing exposure to interest rate changes. The interest rate swap pays a fixed rate of 2.95 % to the swap counterparty in exchange for daily SOFR. At inception, all interest rate swaps were formally documented as cash flow hedges and are measured at fair value each reporting period. The company terminated the interest rate swap as of July 2026 with the repayment of the loan. See Note 10, "Debt", for additional information. The notional contract value of the interest rate swap was $0 and $19,843,000 as of September 30, 2026 and December 31, 2025, respectively.
Financial statement impacts
The following table detail amounts related to our derivatives designated as hedging instruments (in thousands):
| Fair Value of Derivative Instruments September 30, 2026 | ||||||||||||||||||||||||||
| Asset Derivatives | Liability Derivatives | |||||||||||||||||||||||||
| Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||||||||||
| Foreign exchange contracts | Prepaid expenses other current assets | $ | Accrued other liabilities | |||||||||||||||||||||||
| Other non-current assets | $ | Other non-current liabilities | $ | |||||||||||||||||||||||
| Interest rate swaps | Prepaid expenses other current assets | $ | Accrued other liabilities | $ | ||||||||||||||||||||||
| Other non-current assets | $ | Other non-current liabilities | $ | |||||||||||||||||||||||
20
| Fair Value of Derivative Instruments December 31, 2025 | ||||||||||||||||||||||||||
| Asset Derivatives | Liability Derivatives | |||||||||||||||||||||||||
| Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||||||||||
| Foreign exchange contracts | Prepaid expenses other current assets | $ | Accrued other liabilities | $ | ||||||||||||||||||||||
| Other non-current assets | $ | Other non-current liabilities | $ | |||||||||||||||||||||||
| Interest rate swaps | Prepaid expenses other current assets | $ | Accrued other liabilities | $ | ||||||||||||||||||||||
| Other non-current assets | $ | Other non-current liabilities | $ | |||||||||||||||||||||||
21
The following tables summarize the amount of unrealized and realized gain (loss) recognized in Accumulated Other Comprehensive Income ("AOCI") for the three months ended September 30, 2026 and 2025 (in thousands):
| Derivatives in subtopic 815-20 Cash Flow Hedging Relationship: | Amount of Unrealized Gain (Loss) Recognized in Accumulated Other Comprehensive Income on Derivative | Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income(A) | Amount of Realized Gain (Loss) Reclassified from Accumulated Other Comprehensive Income | |||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||
| Foreign exchange contracts | $ | ( | $ | ( | Cost of goods sold | $ | $ | |||||||||||||||||||||||||
| Selling, general and administrative expense | $ | $ | ||||||||||||||||||||||||||||||
| Interest rate swaps | $ | $ | ( | Interest expense | $ | $ | ( | |||||||||||||||||||||||||
The following tables summarize the amount of unrealized and realized gain (loss) recognized in AOCI for the nine months ended September 30, 2026 and 2025 (in thousands):
| Derivatives in subtopic 815-20 Cash Flow Hedging Relationship: | Amount of Unrealized Gain (Loss) Recognized in Accumulated Other Comprehensive Income on Derivative | Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income(A) | Amount of Realized Gain (Loss) Reclassified from Accumulated Other Comprehensive Income | |||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||
| Foreign exchange contracts | $ | $ | Cost of goods sold | $ | $ | ( | ||||||||||||||||||||||||||
| Selling, general and administrative expense | $ | $ | ( | |||||||||||||||||||||||||||||
| Interest rate swaps | $ | $ | ( | Interest expense | $ | $ | ||||||||||||||||||||||||||
(A) The foreign currency derivative activity reclassified from Accumulated Other Comprehensive Income is allocated to cost of goods sold and selling, general and administrative expense based on the percentage of foreign currency spend.
22
16. ACCUMULATED OTHER COMPREHENSIVE INCOME
The following table presents changes in AOCI, net of tax, for the nine months ended September 30, 2026 and 2025 (in thousands):
| 2025: | Derivative Hedging Activities | Post Retirement Benefit Plan Items(A) | Accumulated Other Comprehensive Income (Loss) | ||||||||
| 2025: | |||||||||||
| Balance at December 31, 2024 | $ | ( | $ | $ | |||||||
| Other comprehensive income before reclassifications | |||||||||||
| Amounts reclassified from accumulated other comprehensive income | ( | ( | ( | ||||||||
| Income tax benefit (expense) | ( | ( | |||||||||
| Balance at September 30, 2025 | $ | $ | $ | ||||||||
| 2026: | |||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ||||||||
| Other comprehensive income before reclassifications | |||||||||||
| Amounts reclassified from accumulated other comprehensive income | ( | ( | ( | ||||||||
| Income tax benefit (expense) | |||||||||||
| Balance at September 30, 2026 | $ | $ | $ | ||||||||
23
17. SEGMENT REPORTING
Segment information is prepared on the same basis that our Chief Executive Officer ("CEO"), who serves as our Chief Operating Decision Maker ("CODM"), manages our business, evaluates financial results, and makes key operating decisions. The North America reportable operating segment comprises all manufacturing operations located in the United States, Canada, and Mexico, which we have aggregated into a single reportable operating segment, North America, in consideration of the aggregation criteria set forth in ASC 280. These operations share similar economic characteristics, production processes, and customer bases. The North America reportable segment generates its revenue primarily from the manufacturing and sale of sheet molding compound and molded structural plastic products to customers in the heavy truck, power sports, building products and industrial markets. Our CODM uses income from operations to evaluate performance and make key operating decisions, such as allocating resources and assessing growth opportunities within the North America segment. The CODM is not provided asset information by reportable segment, as asset information is reviewed on a consolidated basis.
The following tables present selected financial information with respect to our single reporting segment for the three and nine months ended September 30, 2026 and 2025 (in thousands):
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| North America Segment: | |||||||||||||||||||||||
| Product revenue | $ | $ | $ | $ | |||||||||||||||||||
| Tooling project revenue | |||||||||||||||||||||||
| North America Segment Total Revenue | |||||||||||||||||||||||
| Less: | |||||||||||||||||||||||
Variable Cost of Goods Sold | |||||||||||||||||||||||
| Fixed Cost of Goods Sold | |||||||||||||||||||||||
| Selling, General and Administration | |||||||||||||||||||||||
| North America Segment Operating Income | |||||||||||||||||||||||
| Less: | |||||||||||||||||||||||
| Net interest expense | |||||||||||||||||||||||
| Net periodic post retirement benefit | ( | ( | ( | ( | |||||||||||||||||||
| Income taxes | |||||||||||||||||||||||
| North America Net Income | $ | $ | $ | $ | |||||||||||||||||||
24
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements within the meaning of the federal securities laws, which are subject to the "safe harbor" created by Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As a general matter, forward-looking statements are those focused upon future plans, objectives or performance as opposed to historical items and include statements of anticipated events or trends and expectations and beliefs relating to matters not historical in nature. Such forward-looking statements involve known and unknown risks and are subject to uncertainties and factors relating to Core Molding Technologies' operations and business environment, all of which are difficult to predict and many of which are beyond Core Molding Technologies' control. Words such as “may,” “will,” “could,” “would,” “should,” “anticipate,” “predict,” “potential,” “continue,” “expect,” “intend,” “plans,” “projects,” “believes,” “estimates,” “encouraged,” “confident” and similar expressions are used to identify these forward-looking statements. These uncertainties and factors could cause Core Molding Technologies' actual results to differ materially from those matters expressed in or implied by such forward-looking statements.
Core Molding Technologies believes that the following factors, among others, could affect its future performance and cause actual results to differ materially from those expressed or implied by forward-looking statements made in this Annual Report on Form 10-Q:
•dependence upon certain major customers as the primary source of Core Molding Technologies’ sales revenues and the potential loss of any major customers due to the completion of existing production programs with those customers or otherwise;
•business conditions in the plastics, transportation, power sports, utilities and commercial product industries (including changes in demand for production);
•the availability and price increases of raw materials;
•general economic, social, regulatory (including foreign trade policy) and political environments, including uncertainties surrounding volatility in financial markets;
•the imposition of new or increased tariffs and the resulting consequences;
•safety and security conditions in Mexico;
•fluctuations in foreign currency exchange rates;
•costs and other resources related to Core Molding Technologies' efforts to expand its customer base and grow its business, and provide on-time delivery to customers;
•the Company’s decision to pursue new products and initiatives to quote and execute manufacturing processes for new business, acquire raw materials, address inflationary pressures, regulatory matters and labor relations;
•the ability to successfully identify, evaluate and manage potential acquisitions and to benefit from and properly integrate and complete acquisitions;
•ability to accurately quote and execute manufacturing processes for new business; the actions of competitors, customers, and suppliers;
•failure of Core Molding Technologies’ suppliers to perform their obligations;
•inflationary pressures; new technologies; regulatory matters;
25
•labor relations and labor availability as well as possible work stoppages or labor disruptions at one or more of our union locations or one of our customer or supplier locations;
•the loss or inability of Core Molding Technologies to attract and retain key personnel;
•federal, state and local environmental laws and regulations (including engine emission regulations);
•the availability of sufficient capital;
•the ability of Core Molding Technologies to provide on-time delivery to customers, which may require additional shipping expenses to ensure on-time delivery or otherwise result in late fees and other customer charges; risk of cancellation or rescheduling of orders;
•inadequate insurance coverage to protect against potential hazards; equipment and machinery failure; product liability and warranty claims;
•cybersecurity incidents or other similar disruptions impacting Core Molding Technologies or significant customers and/or suppliers; and
•other risks identified from time to time in Core Molding Technologies’ other public documents on file with the Securities and Exchange Commission, including those described in Item 1A of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Description of the Company
Core Molding Technologies and its subsidiaries operate in the engineered materials market as one operating segment as a molder of thermoplastic and thermoset structural products. The Company produces and sells molded products for varied markets, including medium and heavy-duty trucks, power sports, building products, industrial and utilities and other commercial markets. Core Molding Technologies has its headquarters in Columbus, Ohio, and operates six production facilities in the United States, Canada and Mexico.
Business Overview
General
The Company’s business and operating results are directly affected by changes in overall customer demand, operational costs and performance and leverage of our fixed cost and selling, general and administrative ("SG&A") infrastructure.
Product revenue fluctuate in response to several factors, including many that are beyond the Company’s control, such as general economic conditions, interest rates, government regulations, consumer spending, raw material cost inflation, labor availability, and our customers’ production rates and inventory levels. The Company's customers operate in many different markets with different cyclicality and seasonality.
Operating performance is dependent on the Company’s ability to manage changes in input costs for items such as raw materials, labor, and overhead operating costs. The Company has certain contractual commitments that restrict its ability to pass through changes in input costs to certain customers. As a result, during periods of significant increases or decreases in input costs operating results may be impacted.
Performance is also affected by manufacturing efficiencies, including items such as on time delivery, quality, scrap, and productivity. Market factors of supply and demand can impact operating costs. In periods of rapid increases or decreases in customer demand, the Company is required to ramp operational activity up or down quickly, which may impact manufacturing efficiencies more than in periods of steady demand.
Operating performance is also dependent on the Company’s ability to effectively launch new customer programs, which are extremely complex in nature. The start of production of a new program is the result of a process of developing new molds and assembly equipment, validation testing, manufacturing process design, development and testing, along with training and often hiring employees. Meeting the targeted levels of manufacturing efficiency for new programs usually occurs over time as the
26
Company gains experience with new tools and processes. Therefore, during a new program launch period, start-up costs and inefficiencies can affect operating results.
Business Outlook
Looking forward, based on industry analyst projections, customer forecasts, cyclical demand, anticipated program launches and price changes, the Company expects revenues for calendar year 2026 to be flat to up 5% as compared to 2025. The Company expects full-year 2026 gross margins to be approximately 16% to 17%, due to elevated freight, higher input costs due to oil prices and commissioning costs associated with the new Monterrey facility. In addition, the Company expects to incur approximately $1.3 million of one-time costs related to relocating hood and battery production between U.S. facilities in the fourth quarter of 2026, impacting total Selling, General and Administrative expenses. The project is expected to generate approximately $1 million in annual savings beginning in 2027 through improved capacity utilization and operating efficiencies. During the third quarter of 2026, the Company amended certain contractual terms related to the Volvo tooling program, including the termination provisions applicable to the arrangement. As a result of the amended terms, the Company determined the tooling program met the criteria for additional revenue to be recognized for the tooling program.
The Company continues to monitor evolving geopolitical tensions involving Iran and any potential impact such developments may have on global supply chains, such as cost and availability. While disruptions could create volatility in the costs of certain inputs, such as oil, used in the Company's manufacturing processes, the Company maintains contractual raw material adjustment mechanisms with many of its customers that allow for changes in material costs to be passed through, which may help mitigate the financial impact of such fluctuations.
The Company also continues to monitor developments related to the upcoming review of the United States-Mexico-Canada Agreement ("USMCA") and other potential changes in North American trade policy. To date, the Company has not experienced any material disruption to production schedules related to these developments and believes its diversified North American manufacturing footprint, long-standing customer relationships, and strong balance sheet positions the Company well to respond to changes in the evolving trade environment while continuing to support future growth initiatives.
Results of Operations
Three Months Ended September 30, 2026, as Compared to Three Months Ended September 30, 2025
Net revenue for the three months ended September 30, 2026 and 2025 totaled $90,237,000 and $58,435,000, respectively. Included in net revenue were tooling project revenue of $25,410,000 and $4,257,000 for the three months ended September 30, 2026 and 2025, respectively. Tooling project revenue are sporadic in nature and fluctuate in regard to scope and related revenue on a period-to-period basis. During the third quarter of 2026, the Company amended contractual terms related to the Volvo tooling program, including the termination provisions applicable to the arrangement. As a result of the amendment, the Company recognized approximately $22 million in revenue during the quarter. Product revenue, excluding tooling project revenue, for the three months ended September 30, 2026 were $64,827,000 compared to $54,178,000 for the same period in 2025. The change in product revenue is primarily the result of higher demand from the medium and heavy-duty truck and new program launches. The Company's product revenue for the three months ended September 30, 2026 compared to the same period in 2025 by market are as follows (in thousands):
| Three months ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Medium and heavy-duty truck | $ | 28,191 | $ | 19,470 | |||||||
| Power sports | 13,555 | 17,548 | |||||||||
| Building products | 6,897 | 5,862 | |||||||||
| Industrial and utilities | 7,111 | 5,851 | |||||||||
| All other | 9,073 | 5,447 | |||||||||
| Net product revenue | $ | 64,827 | $ | 54,178 | |||||||
Gross margin was approximately 14.8% of revenue for the three months ended September 30, 2026, excluding the tooling project impact and commissioning costs of the new Monterrey plant, gross margin was 18.6%. For the three months ended
27
September 30, 2025 gross margin was 17.4%. The increase was due favorable fixed leverage of 1.6% and operating efficiencies and favorable product mix of 0.3%, offset by unfavorable net change of selling price and materials of 0.7%.
SG&A was $11,793,000 for the three months ended September 30, 2026, which included Mexico expansion and Portfolio Footprint Optimization related expense of $1,763,000. Excluding Mexico expansion related expense and Portfolio Footprint Optimization related expense, SG&A cost for the three months ended September 30, 2026 totaled $10,030,000 compared to $7,352,000 for the three months ended September 30, 2025. Increased SG&A expenses resulted primarily from labor and benefit of $1,685,000 and professional services of $257,000.
Net interest expense totaled $39,000 for the three months ended September 30, 2026, compared to net interest expense of $34,000 for the three months ended September 30, 2025. Higher interest expense was due to higher interest rate of net borrowing on the revolver.
Income tax expense for the three months ended September 30, 2026 is estimated to be $155,000, approximately 9.3% of income before income taxes. Income tax expense for the three months ended September 30, 2025 was estimated to be $779,000, approximately 29.3% of income before income taxes. The Company’s effective tax rates reflect the impact of a net loss in higher tax rate countries due to the one-time Mexico expansion related expense.
The Company recorded net income for the three months ended September 30, 2026 of $1,513,000 or $0.18 per basic and $0.17 per diluted share compared with net income of $1,877,000, or $0.22 per basic and diluted share, for the three months ended September 30, 2025.
Comprehensive loss totaled $266,000 for the three months ended September 30, 2026, compared to comprehensive income of $1,491,000 for the same period ended September 30, 2025. The decrease was primarily related to decrease in hedging activity of $1,393,000 and net income of $364,000.
Nine Months Ended September 30, 2026, as Compared to Nine Months Ended September 30, 2025
Net revenue for the nine months ended September 30, 2026 and 2025 totaled $211,549,000 and $199,121,000, respectively. Included in net revenue were tooling project revenue of $28,370,000 and $22,298,000 for the nine months ended September 30, 2026 and 2025, respectively. Tooling project revenue are sporadic in nature and fluctuate in regard to scope and related revenue on a period-to-period basis. Product revenue, excluding tooling project revenue, for the nine months ended September 30, 2026 were $183,179,000 compared to $176,823,000 for the same period in 2025. The increase in revenue is primarily the result of higher demand in power sports and new program launches. The Company's product revenue for the nine months ended September 30, 2026 compared to the same period in 2025 by market are as follows (in thousands):
| Nine months ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Medium and heavy-duty truck | $ | 71,898 | $ | 80,276 | |||||||
| Power sports | 49,497 | 45,962 | |||||||||
| Building products | 18,387 | 16,912 | |||||||||
| Industrial and utilities | 18,642 | 17,095 | |||||||||
| All other | 24,755 | 16,578 | |||||||||
| Net product revenue | $ | 183,179 | $ | 176,823 | |||||||
Gross margin was approximately 18.0% of revenue for the nine months ended September 30, 2026, compared with 18.2% for the same period in 2025. Excluding tooling project impact, commissioning costs of the new Monterrey plant and favorable one time capacity charge, the gross margin for the same period was 19.3% versus 18.2% for the same period in 2025. The increase was due to favorable product mix and operating efficiencies of 1.6%, offset by higher fixed cost leverage of 0.1% and unfavorable net change of selling price and material of 0.4%.
SG&A was $33,440,000 for the nine months ended September 30, 2026, which included severance of $1,411,000 and Mexico expansion related expense and Portfolio Footprint Optimization related expense of $5,167,000. Excluding severance and one-time portfolio optimization costs, SG&A cost for the nine months ended September 30, 2026 totaled $26,862,000 compared to SG&A costs without severance costs and one-time portfolio optimization costs of $24,217,000 for the same period in 2025. Increased SG&A expenses resulted primarily from labor and benefit of $2,337,000.
28
Net interest expense totaled $185,000 for the nine months ended September 30, 2026 compared to net interest expense of $18,000 for the same period in 2025. Higher interest expense was due to net borrowing on the revolver line of $4,810,000, and use of cash to fund capital investments.
Income tax expense for the nine months ended September 30, 2026 is estimated to be $914,000, approximately 19.0% of income before income taxes. Income tax expense for the same period in 2025 was estimated to be $2,840,000, approximately 25.9% of income before income taxes. The Company’s effective tax rates reflect the impact of a net loss in higher tax rate countries due to the onetime Mexico expansion related expense.
The Company recorded net income for the nine months ended September 30, 2026 of $3,901,000 or $0.45 per basic share and diluted share, compared with net income of $8,112,000, or $0.95 per basic and $0.93 per diluted share, for the same period in 2025.
Comprehensive income totaled $2,712,000 for the nine months ended September 30, 2026, compared to comprehensive income of $9,314,000 for the same period in 2025. The decrease was primarily related to decrease in net income of $4,211,000 and hedging activity of $2,388,000.
Liquidity and Capital Resources
Historically, the Company’s primary sources of funds have been cash generated from operating activities and borrowings from third parties. Primary cash requirements are for operating expenses, capital expenditures, repayments of debt, and acquisitions. The Company from time to time will enter into foreign exchange contracts and interest rate swaps to mitigate risk of foreign exchange and interest rate volatility. As of September 30, 2026, the Company had outstanding foreign exchange contracts with notional amounts totaling $68,825,000.
Cash provided by operating activities for the nine months ended September 30, 2026 totaled $3,370,000. Net income of $3,901,000 positively impacted operating cash flows. Non-cash deductions of depreciation and amortization, and share-based compensation included in net income amounted to $8,743,000 and $1,523,000, respectively. Increased working capital decreased cash provided by operating activities by $10,144,000. Higher working capital was primarily related to changes in prepaid assets, accounts receivable and inventories offset by accounts payable and accrued liabilities.
Cash used in investing activities for the nine months ended September 30, 2026 was $19,698,000, which related to purchases of property, plant and equipment. The Company anticipates spending approximately $28,000,000 to $30,000,000 during 2026 on property, plant and equipment purchases for all of the Company's operations. Included in the Company's anticipated spending in 2026 is approximately $18,000,000 to $20,000,000 for the Mexico expansion project. At September 30, 2026, purchase commitments for capital expenditures in progress were $7,544,377. The Company anticipates using cash from operations, its available revolving line of credit or its capex line to fund capital investments.
Cash used for financing activities for the nine months ended September 30, 2026 totaled $16,293,000, which consisted of repayments of long-term debt of $19,843,000, purchase of treasury stock of $648,000, the purchase of treasury stock of $612,000 in exchange for payment of taxes related to net shares settlements of equity awards and net borrowings on the line of credit of $4,810,000.
At September 30, 2026, the Company had $5,437,000 cash on hand, a $50,000,000 revolving loan facility of which none is outstanding, and a $50,000,000 delayed draw term loan with $4,810,000 outstanding.
The Company is required to meet certain financial covenants included in the Huntington Credit Agreement (defined below), which covenants include a net debt leverage and a fixed charge coverage ratio. As of September 30, 2026, the Company was in compliance with its financial covenants associated with the loans made under the Huntington Credit Agreement as described below.
Management believes cash on hand, cash flow from operating activities and available borrowings under the Company's credit agreement will be sufficient to meet the Company's current liquidity needs.
Huntington Credit Agreement
On July 22, 2022, the Company entered into a credit agreement (as amended effective March 7, 2024, December 31, 2025, and July 2, 2026, the "Huntington Credit Agreement") with The Huntington National Bank ("Huntington"), as the sole lender, administrative agent, lead arranger and book runner, and the lenders from time to time thereto. Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company secured loans (the "Huntington Loans") in the
29
maximum aggregate principal amount of $100,000,000, comprised of two $50,000,000 commitments: a delayed draw term loan commitment and revolving loan commitment.
Under the July 2, 2026 Third Amendment to Credit Agreement (the "Third Amendment"), the Company repaid its existing term loan in full, replaced its capital expenditure loan commitment with the delayed draw loan facility, increased the revolving loan commitment from $25,000,000 to $50,000,000 and extended the maturity date of the facilities from July 22, 2027, to July 2, 2031.
At the option of the Company, the Huntington Loans shall be comprised of Alternative Base Rate (ABR) Loans or Secure Overnight Financing Rate (SOFR) Loans.
ABR Loans bear interest at a per annum rate equal to ABR plus a margin of 225 to 300 basis points determined based on the Company's margin leverage ratio. ABR is the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Rate in effect on such day plus 0.50% per annum and (c) Daily Simple SOFR for such day (taking into account any floor set forth in the definition of "Daily Simple SOFR") plus 1.00% annum; provided, that if ABR shall be less than 0.00%, then ABR shall be deemed to be 0.00%.
SOFR Loans bear interest at a per annum rate equal to Daily Simple SOFR plus a margin of 125 to 200 basis points determined based on the Company’s margin leverage ratio, which is defined as consolidated funded indebtedness less unrestricted cash held with Huntington, divided by consolidated EBITDA for the most recently completed four fiscal quarters. As of the Third Amendment effective date, pricing was set at Level I. Daily Simple SOFR means, for any day (a “SOFR Rate Day”), a rate per annum equal to the greater of (a) SOFR for the day (such day, the “SOFR Determination Date”) that is five (5) U.S. Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator’s Website, and (b) 0.00%.
The Company’s obligations under the Huntington Credit Agreement are secured by substantially all of its U.S. and Canadian assets, including its equity interests in its U.S. and Canadian subsidiaries and 65% of its equity interests in its Mexican subsidiaries, and are unconditionally guaranteed by certain subsidiaries of the Company.
The Huntington Credit Agreement contains customary affirmative and negative covenants and events of default. The financial covenants require the Company to maintain a covenant leverage ratio not exceeding 3.00 to 1.00 and a fixed charge coverage ratio of at least 1.20 to 1.00. Capital expenditures are limited to $35,000,000 for fiscal 2026 and $30,000,000 for each fiscal year thereafter. As of September 30, 2026, the Company was in compliance with these covenants. Outstanding borrowings may be prepaid without premium or penalty.
Huntington Delayed Draw Loan
Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company a secured delayed draw loan commitment (the "Huntington Delayed Draw Loan") in the maximum aggregate principal amount of $50,000,000 of which none was outstanding as of September 30, 2026. Proceeds of the Huntington Delayed Draw Loan shall be used for the consummation of acquisitions permitted under the Huntington Credit Agreement.
Borrowings under the Huntington Delayed Draw Loan convert to term loans on July 1, 2028, July 1, 2029, July 1, 2030 or July 2, 2031, based on the availability period in which the borrowing was drawn. Except for borrowings converting on July 2, 2031, monthly principal installments are payable on the tenth day of each calendar month following the applicable conversion date, based on 0.2% of the principal amount converted during each of the first and second calendar years after conversion, 0.4% during each of the third and fourth calendar years, and 0.6% during the fifth calendar year, in each case subject to maturity. Borrowings converting on July 2, 2031 and all remaining outstanding principal are due in full on July 2, 2031.
Huntington Revolving Loan
Pursuant to the terms of the Huntington Credit Agreement, Huntington provides for a revolving loan commitment (the “Huntington Revolving Loan”) in the maximum amount of $50,000,000, under which the Company may borrow at their option at any time during the five-year period following the closing of the Third Amendment (July 2, 2031). As of September 30, 2026, $4,810,000 million was outstanding and $45,190,000 was available under the revolving loan facility. No revolving loan borrowings were outstanding as of December 31, 2025. The revolving loan commitment terminates, and all outstanding borrowings thereunder must be repaid, on July 2, 2031.
30
The interest rate for the Huntington Revolving Loan was 5.15% and 5.46% as of September 30, 2026, and December 31, 2025, respectively.
Off-Balance Sheet Arrangements
The Company did not have any significant off-balance sheet arrangements as of September 30, 2026 or December 31, 2025.
The Company did not have or experience any material changes outside the ordinary course of business as to contractual obligations, including long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or other long-term liabilities reflected in the Company’s Consolidated Balance Sheet under GAAP, as of September 30, 2026 and December 31, 2025.
Critical Accounting Policies and Estimates
For information on critical accounting policies and estimates, see Note 2, "Critical Accounting Policies and Estimates," to the consolidated financial statements included herein.
31
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Company's primary market risk results from changes in the price of commodities used in its manufacturing operations. Core Molding Technologies is also exposed to fluctuations in interest rates and foreign currency fluctuations associated with the Mexican Peso and Canadian Dollar. The Company does not hold any material market risk sensitive instruments for trading purposes. The Company uses derivative financial instruments to hedge exposure to fluctuations in foreign exchange rates and interest rates.
The Company has the following three items that are sensitive to market risks: (1) non-hedged loans under the Huntington Credit Agreement, all of which bear a variable interest rate; (2) non-hedged foreign currency purchases in which the Company purchases Mexican Pesos and Canadian Dollars with United States Dollars to meet certain obligations; and (3) raw material purchases in which the Company purchases various resins, fiberglass, and metal components for use in production. The prices and availability of these materials are affected by the prices of crude oil, natural gas and other feedstocks, tariffs, as well as processing capacity versus demand.
Assuming a hypothetical 10% change in short-term interest rates, interest paid on the Term Loan would be impacted, as the interest rate on these loans is based upon SOFR. It would not, however, have a material effect on earnings before tax as the Company has entered into a hedge to offset changes in SOFR.
Assuming a hypothetical 10% decrease in the United States Dollar to Mexican Peso and Canadian Dollar exchange rate, the Company would be impacted by an increase in operating costs, which would have an adverse effect on operating margins.
Assuming a hypothetical 10% increase in commodity prices, Core Molding Technologies would be impacted by an increase in raw material costs, which would have an adverse effect on operating margins.
Item 4. Controls and Procedures
As of the end of the period covered by this report, the Company has carried out an evaluation, under the supervision and with the participation of its management, including its Chief Executive Officer and its Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act). Based upon this evaluation, the Company’s management, including its Chief Executive Officer and its Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were (i) effective to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act was accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure, and (ii) effective to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. There were no changes in internal controls over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f)) that occurred in the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
32
Part II — Other Information
Item 1. Legal Proceedings
From time to time, the Company is involved in litigation incidental to the conduct of its business. The Company is presently not involved in any legal proceedings which in the opinion of management are likely to have a material adverse effect on the Company's consolidated financial position or results of operations.
Item 1A. Risk Factors
There have been no material changes in Core Molding Technologies' risk factors from those previously disclosed in Core Molding Technologies' Annual Report on Form 10-K for the year ended December 31, 2025.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchases of Equity Securities
The Company repurchased 8,411 shares of the Company's common stock during the three months ended September 30, 2026 with an average stock price of $22.71. On March 11, 2024, the Company announced that its Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $7,500,000 of its outstanding shares of common stock. On March 11, 2026, the Company announced that its Board of Directors approved an increase to the program, authorizing the repurchase of up to an additional approximately $6,500,000 of its outstanding common stock. Under the share repurchase authorization, the Company repurchased 106,659 share during October 2026 for an aggregate purchase price of approximately $2.5 million, at an average price of $23.42 per share. The stock repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be suspended or terminated at any time at the Company’s discretion.
| Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Amount that May Yet be Purchased Under the Plans or Programs | ||||||||||||||||||||||
| July 1 to 30, 2026 | — | — | — | $ | 7,430,000 | |||||||||||||||||||||
| August 1 to 31, 2026 | — | $ | — | — | $ | — | ||||||||||||||||||||
| September 1 to 30, 2026 | 8,411 | $ | 22.71 | 8,411 | $ | 7,239,000 | ||||||||||||||||||||
| Total | 8,411 | — | 8,411 | $ | — | |||||||||||||||||||||
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
During the three months ended September 30, 2026, no director or officer of the Company adopted terminated
Item 6. Exhibits
See Index to Exhibits.
33
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
CORE MOLDING TECHNOLOGIES, INC. | ||||||||||||||
Date: | November 3, 2026 | By: | /s/ Eric Palomaki | |||||||||||
Eric Palomaki | ||||||||||||||
President, Chief Executive Officer, and Director | ||||||||||||||
Date: | November 3, 2026 | By: | /s/ Alex J. Panda | |||||||||||
Alex J. Panda | ||||||||||||||
Executive Vice President, Secretary, Treasurer and Chief Financial Officer | ||||||||||||||
34
INDEX TO EXHIBIT
| Exhibit No. | Description | Location | ||||||||||||
| 3(a) | Amended and Restated Certificate of Incorporation of Core Molding Technologies, Inc. as filed with the Secretary of State of Delaware on May 29, 2024 | |||||||||||||
| 3(b)(1) | Amended and Restated By-Laws of Core Molding Technologies, Inc. | |||||||||||||
| 3(b)(2) | Amendment No. 1 to the Amended and Restated By-Laws of Core Molding Technologies, Inc. | |||||||||||||
| 10.1 | Third Amendment to Credit Agreement dated July 2, 2026 | |||||||||||||
| 31(a) | Section 302 Certification by Eric Palomaki, President, Chief Executive Officer, and Director | |||||||||||||
| 31(b) | Section 302 Certification by Alex J. Panda, Executive Vice President, Secretary, Treasurer, and Chief Financial Officer | |||||||||||||
| 32(a) | Certification of Eric Palomaki, Chief Executive Officer of Core Molding Technologies, Inc., dated November 3, 2026, pursuant to 18 U.S.C. Section 1350 | |||||||||||||
| 32(b) | Certification of Alex J. Panda, Executive Vice President, Secretary, Treasurer and Chief Financial Officer of Core Molding Technologies, Inc., dated November 3, 2026, pursuant to 18 U.S.C. Section 1350 | |||||||||||||
| 101.INS | XBRL Instance Document | Filed Herein | ||||||||||||
| 101.SCH | XBRL Taxonomy Extension Schema Document | Filed Herein | ||||||||||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase | Filed Herein | ||||||||||||
| 101.LAB | XBRL Taxonomy Extension Label Linkbase | Filed Herein | ||||||||||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase | Filed Herein | ||||||||||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase | Filed Herein | ||||||||||||
| 104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) | Filed Herein | ||||||||||||
35
Exhibit 31(a)
SECTION 302 CERTIFICATION
I, Eric Palomaki, certify that:
1.I have reviewed this quarterly report on Form 10-Q of Core Molding Technologies, Inc.;
2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: November 3, 2026
| /s/ Eric Palomaki | |||||
| Eric Palomaki | |||||
| President, Chief Executive Officer, and Director | |||||
Exhibit 31(b)
SECTION 302 CERTIFICATION
I, Alex J. Panda, certify that:
1.I have reviewed this quarterly report on Form 10-Q of Core Molding Technologies, Inc.;
2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: November 3, 2026
/s/ Alex J. Panda | |||||
| Alex J. Panda | |||||
| Vice President, Secretary, Treasurer and Chief Financial Officer | |||||
Exhibit 32(a)
CORE MOLDING TECHNOLOGIES, INC.
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Core Molding Technologies, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2026 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Eric Palomaki, President, Chief Executive Officer, and Director of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:
(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ Eric Palomaki | |||||
| Eric Palomaki | |||||
| President, Chief Executive Officer, and Director | |||||
| November 3, 2026 | |||||
Exhibit 32(b)
CORE MOLDING TECHNOLOGIES, INC.
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Core Molding Technologies, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2026 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Alex J. Panda, Vice President, Secretary, Treasurer, and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:
(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ Alex J. Panda | |||||
| Alex J. Panda | |||||
| Vice President, Secretary, Treasurer and Chief Financial Officer | |||||
| November 3, 2026 | |||||