8-K
Interface Inc (TILE)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): August 1, 2025
INTERFACE INC
(Exact name of Registrant as Specified in its Charter)
| Georgia | 001-33994 | 58-1451243 | |||||
|---|---|---|---|---|---|---|---|
| (State or other Jurisdiction of Incorporation or Organization) | (Commission File<br>Number) | (IRS Employer<br>Identification No.) | 1280 West Peachtree Street NW | Atlanta | Georgia | 30309 | |
| --- | --- | --- | --- | ||||
| (Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code: (770) 437-6800
Not Applicable
(Former name or former address, if changed since last report)
Securities Registered Pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered |
|---|---|---|
| Common Stock, $0.10 Par Value Per Share | TILE | Nasdaq Global Select Market |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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. ¨
Item 2.02 Results of Operations and Financial Condition
On August 1, 2025, Interface, Inc. (the “Company”) issued a press release reporting its financial results for the second quarter of 2025 (the “Earnings Release”). A copy of the Earnings Release is included as Exhibit 99.1 hereto and hereby incorporated by reference. The information set forth in this Item 2.02, including the exhibit hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
Non-GAAP Financial Measures in the Earnings Release
The Earnings Release includes, as additional information for investors, the Company’s adjusted earnings per share, adjusted net income, adjusted operating income ("AOI"), adjusted gross profit, adjusted gross profit margin, adjusted selling, general and administrative (“SG&A”) expenses, currency neutral sales and currency neutral sales growth, net debt, and adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”). These measures are not in accordance with financial measures calculated in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be used as a substitute for, or considered superior to, GAAP financial measures.
Adjusted EPS, adjusted net income, and AOI exclude nora purchase accounting amortization, restructuring, asset impairment, severance, and other, net, and the cyber event impact. Adjusted EPS and adjusted net income also exclude the property casualty loss impact. Adjusted gross profit and adjusted gross profit margin exclude the nora purchase accounting amortization. Adjusted SG&A expenses exclude restructuring, asset impairment, severance, and other, net and the cyber event impact.
Currency neutral sales and currency neutral sales growth exclude the impact of foreign currency fluctuations. Net debt is total debt less cash on hand. Adjusted EBITDA is GAAP net income excluding interest expense, income tax expense, depreciation and amortization, share-based compensation expense, cyber event impact, property casualty loss impact, restructuring, asset impairment, severance, and other, net, the nora purchase accounting amortization, and the loss on foreign subsidiary liquidation.
Because the Company engages in acquisitions only episodically, and not as an everyday matter, the Company believes presenting certain measures excluding the effects of acquisitions facilitates focus on normal ongoing operations. The Company also believes presenting sales information absent the effect of foreign currency exchange rate fluctuations facilitates comparison of the Company’s operational performance between periods.
The Company generally believes reporting its adjusted results helps investors’ understanding of historical operating trends, because it facilitates comparison of current and prior periods during which one or more unique events may have occurred. The Company also believes that adjusted results provide supplemental information for comparisons to other companies which may not have experienced the same events underlying the adjustments. Furthermore, the Company uses adjusted results internally as supplemental information to evaluate its own performance, for planning purposes and in connection with its compensation programs.
Item 7.01 Regulation FD Disclosure
Management of Interface, Inc. (the “Company”) has updated the slide presentation which may be used in whole or in part in meetings with and presentations to investors and potential investors. A copy of the slide presentation is attached as Exhibit 99.2.
The information furnished pursuant to this Item 7.01, including Exhibit 99.2, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release of Interface, Inc., dated August 1, 2025, reporting its financial results for the second quarter of 2025 (furnished pursuant to Item 2.02 of this Report). |
| 99.2 | Interface Inc. slide presentation dated August 2025. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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 hereunto duly authorized.
| INTERFACE, INC. | |
|---|---|
| By: | /s/ Bruce A. Hausmann |
| Bruce A. Hausmann | |
| Chief Financial Officer | |
| Date: August 1, 2025 |
Document
FOR IMMEDIATE RELEASE
| Media Contact:<br><br>Christine Needles<br><br>Global Corporate Communications<br><br>Christine.Needles@interface.com<br><br>+1 404-491-4660 | Investor Contact:<br><br>Bruce Hausmann<br><br>Chief Financial Officer<br><br>Bruce.Hausmann@interface.com<br><br>+1 770-437-6802 |
|---|
Interface Reports Second Quarter 2025 Results
One Interface strategy drives strong sales growth and profitability expansion; Company raises full year guidance
ATLANTA – August 1, 2025 – Interface, Inc. (Nasdaq: TILE), a worldwide commercial flooring company and global leader in sustainability, today announced results for the second quarter ended June 29, 2025.
Second quarter highlights (all comparisons are year-over-year):
•Net sales totaled $376 million, up 8% and up 7% currency neutral.
•GAAP earnings per diluted share of $0.55, a 45% increase; Adjusted earnings per diluted share of $0.60, a 50% increase.
•One Interface strategy continues to drive shareholder value.
“We delivered strong second quarter results ahead of our expectations with currency-neutral net sales growth of 7% and significantly expanded profitability. We continued to see strong momentum and market share gains in the Americas with currency-neutral net sales growth of 11% driven by our combined selling teams and expanded product offerings,” commented Laurel Hurd, CEO of Interface.
“Our One Interface strategy continues to yield measurable results, fueling growth across all product categories and key market segments. Second quarter global billings increased 28% in Healthcare, 11% in Education, and 3% in Corporate Office. Our performance reflects the strength of our strategy and market position, and our team’s disciplined execution, despite market uncertainty,” continued Hurd.
“Gross profit margin expanded 403 basis points driven by higher pricing, favorable product mix, and higher sales volumes that generated manufacturing cost benefits in the second quarter. We are operating from a position of strength, with a solid balance sheet that gives us flexibility and optionality as we remain focused on long-term value creation for shareholders,” added Bruce Hausmann, CFO of Interface.
| Consolidated Results Summary (Unaudited) | Six Months Ended | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (in millions, except percentages and per share data) | 6/30/2024 | Change | 6/29/2025 | 6/30/2024 | Change | ||||||||||
| GAAP | |||||||||||||||
| Net Sales | 375.5 | $ | 346.6 | 8.3 | % | $ | 672.9 | $ | 636.4 | 5.7 | % | ||||
| Gross Profit Margin % of Net Sales | % | 35.4 | % | 403 bps | 38.5 | % | 36.6 | % | 186 bps | ||||||
| SG&A Expenses | 95.9 | $ | 84.5 | 13.6 | % | $ | 183.7 | $ | 170.4 | 7.8 | % | ||||
| SG&A Expenses % of Net Sales | % | 24.4 | % | 118 bps | 27.3 | % | 26.8 | % | 51 bps | ||||||
| Operating Income | 52.0 | $ | 38.2 | 36.4 | % | $ | 75.3 | $ | 62.6 | 20.3 | % | ||||
| Net Income | 32.6 | $ | 22.6 | 44.3 | % | $ | 45.6 | $ | 36.7 | 24.0 | % | ||||
| Earnings per Diluted Share | 0.55 | $ | 0.38 | 44.7 | % | $ | 0.77 | $ | 0.63 | 22.2 | % | ||||
| Non-GAAP | |||||||||||||||
| Currency-Neutral Net Sales | 371.1 | $ | 346.6 | 7.1 | % | $ | 672.9 | $ | 636.4 | 5.7 | % | ||||
| Adjusted Gross Profit Margin % of Net Sales | % | 35.7 | % | 402 bps | 38.9 | % | 37.0 | % | 184 bps | ||||||
| Adjusted SG&A Expenses | 93.4 | $ | 84.3 | 10.8 | % | $ | 180.2 | $ | 170.5 | 5.7 | % | ||||
| Adjusted SG&A Expenses % of Net Sales | % | 24.3 | % | 56 bps | 26.8 | % | 26.8 | % | (1) bps | ||||||
| Adjusted Operating Income | 55.9 | $ | 39.6 | 41.2 | % | $ | 81.4 | $ | 65.1 | 24.9 | % | ||||
| Adjusted Net Income | 35.4 | $ | 23.6 | 49.9 | % | $ | 50.0 | $ | 37.8 | 32.3 | % | ||||
| Adjusted Earnings per Diluted Share | 0.60 | $ | 0.40 | 50.0 | % | $ | 0.85 | $ | 0.64 | 32.8 | % | ||||
| Adjusted EBITDA | 64.8 | $ | 50.5 | 28.4 | % | $ | 101.8 | $ | 89.2 | 14.1 | % | ||||
| Currency-Neutral Orders Increase Year-Over-Year | % | ||||||||||||||
| •Second quarter 2025 adjusted gross profit margin increased 402 basis points year-over-year, due to higher pricing, favorable product mix, and lower manufacturing costs per unit on higher volume; partially offset by higher raw material costs. | |||||||||||||||
| •Second quarter 2025 adjusted SG&A expenses increased 9.1 million year-over-year due to higher sales commissions and variable compensation on increased sales and profits, higher healthcare costs, inflation, and foreign currency exchange variances. | |||||||||||||||
| Additional Metrics | 12/29/2024 | Change | |||||||||||||
| Cash | 121.7 | $ | 99.2 | 22.6 | % | ||||||||||
| Total Debt | 304.4 | $ | 302.8 | 0.6 | % | ||||||||||
| Total Debt Minus Cash ("Net Debt") | 182.7 | $ | 203.5 | (10.2) | % | ||||||||||
| Last 12-Months Adjusted EBITDA | 201.6 | ||||||||||||||
| Total Debt divided by Last 12-Months Net Income | |||||||||||||||
| Net Debt divided by Last 12-Months Adjusted EBITDA ("Net Leverage Ratio") |
All values are in US Dollars.
| Segment Results Summary (Unaudited) | Three Months Ended | Six Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (in millions, except percentages) | 6/29/2025 | 6/30/2024 | Change | 6/29/2025 | 6/30/2024 | Change | |||||||
| AMS | |||||||||||||
| Net Sales | $ | 239.4 | $ | 215.0 | 11.4 | % | $ | 419.4 | $ | 384.9 | 9.0 | % | |
| Currency-Neutral Net Sales | $ | 239.6 | $ | 215.0 | 11.5 | % | $ | 420.3 | $ | 384.9 | 9.2 | % | |
| Operating Income | $ | 48.8 | $ | 26.8 | 82.2 | % | $ | 68.0 | $ | 45.0 | 51.1 | % | |
| Adjusted Operating Income | $ | 48.8 | $ | 26.9 | 81.3 | % | $ | 68.7 | $ | 45.0 | 52.6 | % | |
| Currency-Neutral Orders Increase Year-Over-Year | 2.1 | % | |||||||||||
| EAAA | |||||||||||||
| Net Sales | $ | 136.1 | $ | 131.6 | 3.4 | % | $ | 253.6 | $ | 251.5 | 0.8 | % | |
| Currency-Neutral Net Sales | $ | 131.5 | $ | 131.6 | (0.1) | % | $ | 252.6 | $ | 251.5 | 0.4 | % | |
| Operating Income | $ | 3.2 | $ | 11.3 | (71.8) | % | $ | 7.3 | $ | 17.6 | (58.5) | % | |
| Adjusted Operating Income | $ | 7.1 | $ | 12.7 | (44.2) | % | $ | 12.7 | $ | 20.1 | (37.0) | % | |
| Currency-Neutral Orders (Decrease) Year-Over-Year | 4.3 | % |
Outlook
Based on strong Q2 2025 results, Interface is raising its full fiscal year guidance, while acknowledging a dynamic and uncertain global macro environment. With that backdrop in mind, Interface anticipates the following:
| Q3 Fiscal Year 2025 Outlook | |
|---|---|
| Net sales | 350 million to 360 million |
| Adjusted gross profit margin | 38.0% of net sales |
| Adjusted SG&A expenses | 92 million |
| Adjusted interest & other expenses | 6 million |
| Adjusted effective income tax rate | 27.0% |
| Fully diluted weighted average share count | 59.1 million shares |
| Note: All figures are approximate | |
| Full Fiscal Year 2025 Outlook | |
| Net sales | 1.370 billion to 1.390 billion |
| Adjusted gross profit margin | 37.7% of net sales |
| Adjusted SG&A expenses | 362 million |
| Adjusted interest & other expenses | 25 million |
| Adjusted effective income tax rate | 26.0% |
| Capital expenditures | 45 million |
| Note: All figures are approximate |
All values are in US Dollars.
Webcast and Conference Call Information
Interface will host a conference call on August 1, 2025, at 8:00 a.m. Eastern Time, to discuss its second quarter 2025 results. The conference call will be simultaneously broadcast live over the Internet.
Listeners may access the conference call live over the Internet at:
https://events.q4inc.com/attendee/783508824, or through the Company's website at: https://investors.interface.com.
The archived version of the webcast will be available at these sites for one year beginning approximately one hour after the call ends.
Non-GAAP Financial Measures
Interface provides adjusted earnings per share, adjusted net income, adjusted operating income ("AOI"), adjusted gross profit, adjusted gross profit margin, adjusted SG&A expenses, currency- neutral sales and currency-neutral sales growth, net debt, and adjusted EBITDA as additional information regarding its operating results in this press release. These non-GAAP measures are not in accordance with – or alternatives to – GAAP measures, and may be different from non-GAAP measures used by other companies. Adjusted EPS, adjusted net income, and AOI exclude nora purchase accounting amortization, restructuring, asset impairment, severance, and other, net, and the cyber event impact. Adjusted EPS and adjusted net income also exclude the property casualty loss impact. Adjusted gross profit and adjusted gross profit margin exclude the nora purchase accounting amortization. Adjusted SG&A expenses exclude restructuring, asset impairment, severance, and other, net and the cyber event impact. Currency-neutral sales and currency-neutral sales growth exclude the impact of foreign currency fluctuations.
Net debt is total debt less cash on hand. Adjusted EBITDA is GAAP net income excluding interest expense, income tax expense, depreciation and amortization, share-based compensation expense, cyber event impact, property casualty loss impact, restructuring, asset impairment, severance, and other, net, the nora purchase accounting amortization, and the loss on foreign subsidiary liquidation. This news release should be read in conjunction with the Company's Current Report on Form 8-K furnished today to the U.S. Securities & Exchange Commission, which explains why Interface believes presentation of these non-GAAP measures provides useful information to investors, as well as any additional material purposes for which Interface uses these non-GAAP measures.
About Interface
Interface, Inc. (NASDAQ: TILE) is a global flooring solutions company and sustainability leader, offering an integrated portfolio of carpet tile and resilient flooring products that includes Interface® carpet tile and LVT, nora® rubber flooring, and FLOR® premium area rugs for commercial and residential spaces. Made with purpose and without compromise, Interface flooring brings more sophisticated design, more performance, more innovation, and more climate progress to interior spaces.
A decades-long pioneer in sustainability, Interface remains “all in” on becoming a restorative business. Today, the company is focusing on carbon reductions, not offsets, as it works toward achieving its verified science-based targets by 2030 and its goal to become a carbon negative enterprise by 2040.
Learn more about Interface at interface.com and blog.interface.com, nora by Interface at nora.com, FLOR at FLOR.com, and our sustainability journey at interface.com/sustainability.
Follow us on Facebook, Instagram, LinkedIn, X, and Pinterest.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
Except for historical information contained herein, the other matters set forth in this news release are forward-looking statements. Forward-looking statements may be identified by words such as “may,” “expect,” “forecast,” “anticipate,” “intend,” “plan,” “believe,” “could,” “should,” “goal,” “aim," “objective,” “seek,” “project,” “estimate,” “target,” “will” and similar expressions. Forward-looking statements in this press release include, without limitation, any projections we make regarding the Company’s 2025 third quarter and full year 2025 under “Outlook” above. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including but not limited to the risks under the following subheadings in “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2024: "We compete with a large number of manufacturers in the highly competitive floorcovering products market, and some of these competitors have greater financial resources than we do. We may face challenges competing on price, making investments in our business, or competing on product design or sustainability", "Our earnings could be adversely affected by non-cash adjustments to goodwill, when a test of goodwill assets indicates a material impairment of those assets", "Our success depends significantly upon the efforts, abilities and continued service of our senior management executives, our principal design consultant and other key personnel (including experienced sales and manufacturing personnel), and our loss of any of them could affect us adversely", "Large increases in the cost of our raw materials, shipping costs, duties or tariffs could adversely affect us if we are unable to pass these cost increases through to our customers", "Unanticipated termination or interruption of any of our arrangements with our primary third-party suppliers of synthetic fiber or our primary third-party supplier for luxury vinyl tile (“LVT”) or other key raw materials could have a material adverse effect on us", "Changes to our facilities, manufacturing processes, product construction, and product composition could disrupt our operations, increase our manufacturing costs, increase customer complaints, increase warranty claims, negatively affect our reputation, and have a material adverse effect on our financial condition and results of operations", "Our business operations could suffer significant losses from natural disasters, acts of war, terrorism, catastrophes, fire, adverse weather conditions, pandemics, endemics, unstable geopolitical situations or other unexpected events", "The market price of our common stock has been volatile and the value of your investment may decline", "Sales of our principal products have been and may continue to be affected by adverse economic cycles, and effects in the new construction market and renovation market", "Disruptions to or failures of information technology systems we use could adversely affect our business", "The impact of potential changes to environmental laws and regulations and industry standards regarding climate change and other sustainability matters could lead to unforeseen disruptions to our business operations", "Health crisis events, such as epidemics or pandemics, have adversely impacted, and may continue to impact, the economy and disrupt our operations and supply chains, which may have an adverse effect on our results of operations", Our substantial international operations are subject to various political, economic and other uncertainties that could adversely affect our business results, including foreign currency fluctuations, restrictive taxation, custom duties, tariffs, border closings or other adverse government regulations", "The conflicts between Russia and Ukraine and in the Middle East could adversely affect our business, results of operations and financial position", "Fluctuations in foreign currency exchange rates have had, and could continue to have, an adverse impact on our financial condition and results of operations", "The uncertainty surrounding the ongoing implementation and effect of the U.K.’s exit from the European Union, and related negative developments in the European Union, could adversely affect our business, results of operations or financial condition", "We have a substantial amount of debt, which could adversely affect our business, financial condition and results of operations and our ability to meet our payment obligations under our debt", "Servicing our debt requires a significant amount of cash, and we may not have sufficient cash flow from our operations to pay our indebtedness", "We may incur substantial additional indebtedness, which could further exacerbate the risks associated with our substantial indebtedness", and "We face risks associated with litigation and claims".
You should consider any additional or updated information we include under the heading “Risk Factors” in our subsequent quarterly and annual reports.
Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and, as such, speak only as of the date made. The Company assumes no responsibility to update or revise forward-looking statements made in this press release and cautions readers not to place undue reliance on any such forward-looking statements.
- TABLES FOLLOW -
| Consolidated Statements of Operations (Unaudited) | Three Months Ended | Six Months Ended | ||||||
|---|---|---|---|---|---|---|---|---|
| (In thousands, except per share data) | 6/29/2025 | 6/30/2024 | 6/29/2025 | 6/30/2024 | ||||
| Net Sales | $ | 375,522 | $ | 346,635 | $ | 672,935 | $ | 636,378 |
| Cost of Sales | 227,545 | 224,022 | 413,995 | 403,360 | ||||
| Gross Profit | 147,977 | 122,613 | 258,940 | 233,018 | ||||
| Selling, General & Administrative Expenses | 95,930 | 84,462 | 183,666 | 170,421 | ||||
| Operating Income | 52,047 | 38,151 | 75,274 | 62,597 | ||||
| Interest Expense | 4,443 | 6,173 | 8,858 | 12,596 | ||||
| Other Expense (Income), net | 3,411 | 832 | 5,114 | (144) | ||||
| Income Before Income Tax Expense | 44,193 | 31,146 | 61,302 | 50,145 | ||||
| Income Tax Expense | 11,632 | 8,588 | 15,739 | 13,408 | ||||
| Net Income | $ | 32,561 | $ | 22,558 | $ | 45,563 | $ | 36,737 |
| Earnings Per Share – Basic | $ | 0.56 | $ | 0.39 | $ | 0.78 | $ | 0.63 |
| Earnings Per Share – Diluted | $ | 0.55 | $ | 0.38 | $ | 0.77 | $ | 0.63 |
| Common Shares Outstanding – Basic | 58,555 | 58,281 | 58,495 | 58,260 | ||||
| Common Shares Outstanding – Diluted | 59,073 | 58,692 | 59,123 | 58,703 | ||||
| Consolidated Balance Sheets (Unaudited) | ||||||||
| --- | --- | --- | --- | --- | ||||
| (In thousands) | 6/29/2025 | 12/29/2024 | ||||||
| Assets | ||||||||
| Cash and Cash Equivalents | $ | 121,701 | $ | 99,226 | ||||
| Accounts Receivable, net | 194,251 | 171,135 | ||||||
| Inventories, net | 288,165 | 260,581 | ||||||
| Other Current Assets | 38,969 | 33,355 | ||||||
| Total Current Assets | 643,086 | 564,297 | ||||||
| Property, Plant and Equipment, net | 291,839 | 282,374 | ||||||
| Operating Lease Right-of-Use Assets | 80,619 | 76,815 | ||||||
| Goodwill and intangibles assets, net | 162,770 | 148,160 | ||||||
| Other Assets | 99,908 | 99,170 | ||||||
| Total Assets | $ | 1,278,222 | $ | 1,170,816 | ||||
| Liabilities | ||||||||
| Accounts Payable | $ | 86,621 | $ | 68,943 | ||||
| Accrued Expenses | 122,850 | 134,996 | ||||||
| Current Portion of Operating Lease Liabilities | 13,571 | 12,296 | ||||||
| Current Portion of Long-Term Debt | 506 | 482 | ||||||
| Total Current Liabilities | 223,548 | 216,717 | ||||||
| Long-Term Debt | 303,943 | 302,275 | ||||||
| Operating Lease Liabilities | 71,541 | 68,092 | ||||||
| Other Long-Term Liabilities | 104,165 | 94,584 | ||||||
| Total Liabilities | 703,197 | 681,668 | ||||||
| Shareholders’ Equity | 575,025 | 489,148 | ||||||
| Total Liabilities and Shareholders’ Equity | $ | 1,278,222 | $ | 1,170,816 | ||||
| Consolidated Statements of Cash Flows (Unaudited) | Three Months Ended | Six Months Ended | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| (In thousands) | 6/29/2025 | 6/30/2024 | 6/29/2025 | 6/30/2024 | ||||
| OPERATING ACTIVITIES | ||||||||
| Net Income | $ | 32,561 | $ | 22,558 | $ | 45,563 | $ | 36,737 |
| Adjustments to Reconcile Net Income to Cash Provided by Operating Activities: | ||||||||
| Depreciation and Amortization | 9,829 | 9,728 | 19,230 | 19,344 | ||||
| Share-Based Compensation Expense | 2,771 | 2,616 | 6,917 | 6,531 | ||||
| Deferred Taxes | 1,091 | (361) | 254 | (1,039) | ||||
| Other | (1,959) | (58) | 1,111 | (3,766) | ||||
| Amortization of Acquired Intangible Assets | 1,352 | 1,287 | 2,606 | 2,584 | ||||
| Change in Working Capital | ||||||||
| Accounts Receivable | (25,414) | (32,744) | (14,739) | (18,907) | ||||
| Inventories | 4,238 | 14,816 | (12,101) | (5,661) | ||||
| Prepaid Expenses and Other Current Assets | (970) | (4,139) | (4,408) | (6,332) | ||||
| Accounts Payable and Accrued Expenses | 6,629 | 7,836 | (2,566) | 4,667 | ||||
| Cash Provided by Operating Activities | 30,128 | 21,539 | 41,867 | 34,158 | ||||
| INVESTING ACTIVITIES | ||||||||
| Capital Expenditures | (7,354) | (9,574) | (14,821) | (13,607) | ||||
| Proceeds from Sale of Property, Plant and Equipment | — | — | — | 1,040 | ||||
| Insurance Proceeds from Property Casualty Loss | — | — | — | 1,000 | ||||
| Cash Used in Investing Activities | (7,354) | (9,574) | (14,821) | (11,567) | ||||
| FINANCING ACTIVITIES | ||||||||
| Repayments of Long-term Debt | (131) | (12,147) | (253) | (46,930) | ||||
| Borrowing of Long-term Debt | 1,306 | 7,334 | 1,306 | 17,334 | ||||
| Repurchase of Common Stock | (4,286) | — | (4,286) | — | ||||
| Tax Withholding Payments for Share-Based Compensation | (6) | (483) | (7,736) | (4,754) | ||||
| Dividends Paid | (1,173) | (1,167) | (1,227) | (1,173) | ||||
| Finance Lease Payments | (782) | (721) | (1,544) | (1,437) | ||||
| Cash Used in Financing Activities | (5,072) | (7,184) | (13,740) | (36,960) | ||||
| Net Cash Provided by (Used in) Operating, Investing and Financing Activities | 17,702 | 4,781 | 13,306 | (14,369) | ||||
| Effect of Exchange Rate Changes on Cash | 6,242 | (368) | 9,169 | (1,942) | ||||
| CASH AND CASH EQUIVALENTS | ||||||||
| Net Change During the Period | 23,944 | 4,413 | 22,475 | (16,311) | ||||
| Balance at Beginning of Period | 97,757 | 89,774 | 99,226 | 110,498 | ||||
| Balance at End of Period | $ | 121,701 | $ | 94,187 | $ | 121,701 | $ | 94,187 |
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures (Unaudited)
(In millions, except per share amounts)
| Second Quarter 2025 | Second Quarter 2024 | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Adjustments | Adjustments | |||||||||||||||||||||||
| Gross Profit | SG&A Expenses | Operating Income (Loss) | Pre-tax | Tax Effect | Net Income (Loss) | Diluted EPS | Gross Profit | SG&A Expenses | Operating Income (Loss) | Pre-tax | Tax Effect | Net Income (Loss) | Diluted EPS | |||||||||||
| GAAP As Reported | $ | 148.0 | $ | 95.9 | $ | 52.0 | $ | 32.6 | $ | 0.55 | $ | 122.6 | $ | 84.5 | $ | 38.2 | $ | 22.6 | $ | 0.38 | ||||
| Non-GAAP Adjustments: | ||||||||||||||||||||||||
| Purchase Accounting Amortization | 1.4 | — | 1.4 | 1.4 | (0.4) | 1.0 | 0.02 | 1.3 | — | 1.3 | 1.3 | (0.4) | 0.9 | 0.02 | ||||||||||
| Restructuring, Asset Impairment, Severance, and Other, net | — | (2.5) | 2.5 | 2.5 | (0.6) | 1.9 | 0.03 | — | (0.1) | 0.1 | 0.1 | 0.0 | 0.1 | — | ||||||||||
| Adjustments Subtotal * | 1.4 | (2.5) | 3.9 | 3.9 | (1.0) | 2.8 | 0.05 | 1.3 | (0.2) | 1.5 | 1.5 | (0.4) | 1.0 | 0.02 | ||||||||||
| Adjusted (non-GAAP) * | $ | 149.3 | $ | 93.4 | $ | 55.9 | $ | 35.4 | $ | 0.60 | $ | 123.9 | $ | 84.3 | $ | 39.6 | $ | 23.6 | $ | 0.40 | ||||
| * Note: Sum of reconciling items may differ from total due to rounding of individual components | ||||||||||||||||||||||||
| First Six Months 2025 | First Six Months 2024 | |||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Adjustments | Adjustments | |||||||||||||||||||||||
| Gross Profit | SG&A Expenses | Operating Income (Loss) | Pre-tax | Tax Effect | Net Income (Loss) | Diluted EPS | Gross Profit | SG&A Expenses | Operating Income (Loss) | Pre-tax | Tax Effect | Net Income (Loss) | Diluted EPS | |||||||||||
| GAAP As Reported | $ | 258.9 | $ | 183.7 | $ | 75.3 | $ | 45.6 | $ | 0.77 | $ | 233.0 | $ | 170.4 | $ | 62.6 | $ | 36.7 | $ | 0.63 | ||||
| Non-GAAP Adjustments: | ||||||||||||||||||||||||
| Purchase Accounting Amortization | 2.6 | — | 2.6 | 2.6 | (0.8) | 1.8 | 0.03 | 2.6 | — | 2.6 | 2.6 | (0.8) | 1.8 | 0.03 | ||||||||||
| Restructuring, Asset Impairment, Severance, and Other, net | — | (3.5) | 3.5 | 3.5 | (0.9) | 2.6 | 0.04 | — | (0.3) | 0.3 | 0.3 | (0.1) | 0.3 | — | ||||||||||
| Cyber Event Impact | — | — | — | — | — | — | — | — | 0.4 | (0.4) | (0.4) | 0.1 | (0.3) | (0.01) | ||||||||||
| Property Casualty Loss (1) | — | — | — | — | — | — | — | — | — | — | (1.0) | 0.2 | (0.7) | (0.01) | ||||||||||
| Adjustments Subtotal * | 2.6 | (3.5) | 6.1 | 6.1 | (1.6) | 4.5 | 0.08 | 2.6 | 0.1 | 2.5 | 1.6 | (0.5) | 1.1 | 0.02 | ||||||||||
| Adjusted (non-GAAP) * | $ | 261.5 | $ | 180.2 | $ | 81.4 | $ | 50.0 | $ | 0.85 | $ | 235.6 | $ | 170.5 | $ | 65.1 | $ | 37.8 | $ | 0.64 | ||||
| (1) Represents property insurance (recovery) / loss | ||||||||||||||||||||||||
| * Note: Sum of reconciling items may differ from total due to rounding of individual components |
Reconciliation of Segment GAAP Financial Measures to Non-GAAP Financial Measures ("Currency-Neutral Net Sales", and "AOI")
(In millions)
| Second Quarter 2025 | Second Quarter 2024 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| AMS Segment | EAAA Segment | Consolidated * | AMS Segment | EAAA Segment | Consolidated * | |||||||
| Net Sales as Reported (GAAP) | $ | 239.4 | $ | 136.1 | $ | 375.5 | $ | 215.0 | $ | 131.6 | $ | 346.6 |
| Impact of Changes in Currency | 0.2 | (4.6) | (4.4) | — | — | — | ||||||
| Currency-Neutral Net Sales * | $ | 239.6 | $ | 131.5 | $ | 371.1 | $ | 215.0 | $ | 131.6 | $ | 346.6 |
| * Note: Sum of reconciling items may differ from total due to rounding of individual components | ||||||||||||
| First Six Months 2025 | First Six Months 2024 | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| AMS Segment | EAAA Segment | Consolidated * | AMS Segment | EAAA Segment | Consolidated * | |||||||
| Net Sales as Reported (GAAP) | $ | 419.4 | $ | 253.6 | $ | 672.9 | $ | 384.9 | $ | 251.5 | $ | 636.4 |
| Impact of Changes in Currency | 0.9 | (1.0) | (0.1) | — | — | — | ||||||
| Currency-Neutral Net Sales * | $ | 420.3 | $ | 252.6 | $ | 672.9 | $ | 384.9 | $ | 251.5 | $ | 636.4 |
| * Note: Sum of reconciling items may differ from total due to rounding of individual components | ||||||||||||
| Second Quarter 2025 | Second Quarter 2024 | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| AMS Segment | EAAA Segment | Consolidated * | AMS Segment | EAAA Segment | Consolidated * | |||||||
| GAAP Operating Income (Loss) | $ | 48.8 | $ | 3.2 | $ | 52.0 | $ | 26.8 | $ | 11.3 | $ | 38.2 |
| Non-GAAP Adjustments: | ||||||||||||
| Purchase Accounting Amortization | — | 1.4 | 1.4 | — | 1.3 | 1.3 | ||||||
| Restructuring, Asset Impairment, Severance, and Other, net | — | 2.5 | 2.5 | 0.1 | — | 0.1 | ||||||
| Adjustments Subtotal * | — | 3.9 | 3.9 | 0.1 | 1.3 | 1.5 | ||||||
| AOI * | $ | 48.8 | $ | 7.1 | $ | 55.9 | $ | 26.9 | $ | 12.7 | $ | 39.6 |
| * Note: Sum of reconciling items may differ from total due to rounding of individual components | ||||||||||||
| First Six Months 2025 | First Six Months 2024 | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| AMS Segment | EAAA Segment | Consolidated * | AMS Segment | EAAA Segment | Consolidated * | |||||||
| GAAP Operating Income (Loss) | $ | 68.0 | $ | 7.3 | $ | 75.3 | $ | 45.0 | $ | 17.6 | $ | 62.6 |
| Non-GAAP Adjustments: | ||||||||||||
| Purchase Accounting Amortization | — | 2.6 | 2.6 | — | 2.6 | 2.6 | ||||||
| Cyber Event Impact | — | — | — | (0.2) | (0.2) | (0.4) | ||||||
| Restructuring, Asset Impairment, Severance, and Other, net | 0.7 | 2.8 | 3.5 | 0.3 | 0.1 | 0.3 | ||||||
| Adjustments Subtotal * | 0.7 | 5.4 | 6.1 | — | 2.5 | 2.5 | ||||||
| AOI * | $ | 68.7 | $ | 12.7 | $ | 81.4 | $ | 45.0 | $ | 20.1 | $ | 65.1 |
| * Note: Sum of reconciling items may differ from total due to rounding of individual components | ||||||||||||
| (in millions) | Second Quarter 2025 | Second Quarter 2024 | First Six Months 2025 | First Six Months 2024 | Last Twelve Months (LTM) Ended 6/29/2025 | Fiscal Year 2024 | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Net Income as Reported (GAAP) | $ | 32.6 | $ | 22.6 | $ | 45.6 | $ | 36.7 | $ | 95.8 | $ | 86.9 |
| Income Tax Expense | 11.6 | 8.6 | 15.7 | 13.4 | 28.9 | 26.6 | ||||||
| Interest Expense (including debt issuance cost amortization) | 4.4 | 6.2 | 8.9 | 12.6 | 19.5 | 23.2 | ||||||
| Depreciation and Amortization (excluding debt issuance cost amortization) | 9.6 | 9.1 | 18.7 | 18.4 | 37.6 | 37.3 | ||||||
| Share-based Compensation Expense | 2.8 | 2.6 | 6.9 | 6.5 | 13.3 | 12.9 | ||||||
| Purchase Accounting Amortization | 1.4 | 1.3 | 2.6 | 2.6 | 5.2 | 5.2 | ||||||
| Restructuring, Asset Impairment, Severance, and Other, net | 2.5 | 0.1 | 3.5 | 0.3 | 5.7 | 2.5 | ||||||
| Cyber Event Impact | — | — | — | (0.4) | (5.1) | (5.5) | ||||||
| Property Casualty Loss(1) | — | — | — | (1.0) | (1.4) | (2.3) | ||||||
| Loss on Foreign Subsidiary Liquidation (2) | — | — | — | — | 2.2 | 2.2 | ||||||
| Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (AEBITDA)* | $ | 64.8 | $ | 50.5 | $ | 101.8 | $ | 89.2 | $ | 201.6 | $ | 189.0 |
| (1) Represents insurance recovery. | ||||||||||||
| (2) In 2024 our Thailand subsidiary was substantially liquidated and the related cumulative translation adjustment was recognized in other expense. | ||||||||||||
| * Note: Sum of reconciling items may differ from total due to rounding of individual components |
The impacts of changes in foreign currency presented in the tables are calculated based on applying the prior year period's average foreign currency exchange rates to the current year period.
The Company believes that the above non-GAAP performance measures, which management uses in managing and evaluating the Company’s business, may provide users of the Company’s financial information with additional meaningful basis for comparing the Company’s current results and results in a prior period, as these measures reflect factors that are unique to one period relative to the comparable period. However, these non‑GAAP performance measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under accounting principles generally accepted in the United States. Tax effects identified above (when applicable) are calculated using the statutory tax rate for the jurisdictions in which the charge or income occurred.
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15
investorpresentationq2fy
Investor Presentation | August 2025
2 Forward Looking Statements and Non-GAAP Measures This presentation contains forward-looking statements, including, in particular, statements about Interface’s plans, strategies and prospects. These are based on the Company’s current assumptions, expectations and projections about future events. Although Interface believes that the expectations reflected in these forward-looking statements are reasonable, the Company can give no assurance that these expectations will prove to be correct or that savings or other benefits anticipated in the forward-looking statements will be achieved. The forward-looking statements set forth involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including risks and uncertainties associated with economic conditions in the commercial interiors industry and the risks under the heading “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 2024, which discussions are hereby incorporated by reference. You should also consider any additional or updated information we include under the heading “Risk Factors” in our subsequent annual and quarterly reports. Forward-looking statements in this presentation include, without limitation, the information set forth on the slides titled “Interface: a compelling investment”, “‘One Interface’ Strategy”, “Brand Leader in the Specified Channel”, and “Financial Policy”. Other forward-looking statements can be identified by words such as “may,” “expect,” “forecast,” “anticipate,” “intend,” “plan,” “believe,” “could,” “should”, “goal”, “aim”, “objective”, “commitment”, “seek,” “project,” “estimate,” “target,” and similar expressions. Forward-looking statements speak only as of the date made. The Company assumes no responsibility to update or revise forward-looking statements and cautions listeners and meeting attendees not to place undue reliance on any such statements. This presentation includes certain financial measures not calculated in accordance with U.S. GAAP. They may be different from similarly titled non-GAAP measures used by other companies, and should not be used as a substitute for, or considered superior to, GAAP measures. Reconciliations to the most directly comparable GAAP measures appear in the Appendix Note: Sum of reconciling items may differ from total due to rounding of individual components
3 At Interface, we’re Made for More Who We Are Leading Established GlobalDedicated Engaged provider of commercial flooring: carpet tile, rubber, and LVT brand with a history of innovation and a commitment to the pursuit of sustainability to performance and improving the built environment, industry, and the world manufacturing capabilities with a focus on local market needs customer-centric and purpose- driven culture with deep design and innovation roots
Interface is a global leader in commercial flooring 4 $1.3 billion in net sales in FY2024 3,600 global employees 6 manufacturing locations on 4 continents ATL headquartered in Atlanta, GA Recognized leader in sustainability with over 50 years of innovation First cradle-to-gate carbon negative commercial carpet tile and rubber flooring prototype Premium brands with attractive margins and leadership in core categories
10% APAC 45% Corporate Office 20% Education Increase in return to office mandates driving refreshes, especially in Class A space Our premium products are competitively advantaged in design, performance and sustainability Regional migration driving segment growth K-12 schools modernizing and expanding facilities Higher education campus investments being made to attract students in a competitive market An aging population, longer life expectancies and increased technology usage supporting demand Our U.S. integrated sales teams finding new opportunities to sell our full suite of products Includes Government, Retail, Residential Living, Hospitality, Consumer Residential and all other segments Healthcare 28% EMEA 62% Americas REVENUE BY REGION Diversified Geographically and Customer Segments 5 Note: Figures represent LTM Q2 2025 and may not sum to 100% due to rounding Corporate Education Other 10% Healthcare 25% Other REVENUE BY CUSTOMER SEGMENT
Interface: a compelling investment 6 We are global leaders in… … with a strong financial foundation Performance SustainabilityDesign attractive margins strong liquidity healthy balance sheet Im ag es © C hr is to ph er P ay ne / Es to … and unwavering commitment to our people winning culture commitment to talent development activation of inclusion networks
‘One Interface’ Strategy Build strong global functions to support our world-class local sales teams Accelerate growth through enhanced productivity of our commercial teams Expand margins through global supply chain management and complexity reduction Lead in design, performance, and sustainability 7
Interface Positioning
Attractive Product Portfolio 9 Carpet Tile Industry-leading cradle-to-gate carbon negative carpet tile Biomimicry-inspired design (i2) No glue installation with TacTiles® Faster, more profitable installation for contractors Recyclable via our ReEntry® program Luxury Vinyl Tile (LVT) Creative design freedom Complements and enhances our carpet tile portfolio No transition strips needed; same sizes as our carpet tiles High acoustic value (Sound Choice backing) Rubber Offered in modular tiles, sheet, and specialized surface sheet Ideal for hygienic, high-traffic flooring applications Extremely durable with strong chemical resistance Industry-leading cradle-to-gate carbon negative rubber flooring prototype
Total global commercial flooring market = $39 Billion Interface served market = $9+ Billion Global share leader in $5B Carpet Tile segment (now exceeds Broadloom segment globally) Leader in high growth $3B LVT segment Entered $1B Rubber segment in 2018, acquisition of nora, the category leader Source: Market Insights LLC Ceramic Tile Wood LVT Resilient Laminate Other BroadloomCarpet Tile Hard Surface Soft Surface $12 $7 $2 $1 $3 $3 $5 Other Global Commercial Flooring Segment ($ in billions) Leading Global Provider of Commercial Flooring Solutions 10 Rubber $5
- 20 40 60 80 100 120 Low End Mid-Range High End Brand Leader in the Specified Channel 11 Interface competes on design, sustainability and innovation, commanding a premium price point and industry leading margins. Source: 2023 World Map – Contract Carpet Tiles (AJCP Associates) Opportunity to expand in low/mid-range price points Maintain significant share of the high-end and mid-range price points Share leader in the specified and end user channels of commercial carpet tile Global Carpet Tile Price Categories Interface Share <15% ~15 – 25% +25% Vo lu m e (s qu ar e m et er s in m illi on s)
Physical presence in 18 countries Global account management Six manufacturing locations on four continents Global supply chain management Unique blend of efficiency and customization Note: Figures represent LTM Q2 2025 and may not sum to 100% due to rounding Americas 62% of Net Sales Europe 28% of Net Sales Asia-Pacific 10% of Net Sales Carpet Manufacturing Facility Rubber Manufacturing Facility LVT Supplier Facility Showroom / Office Global Sales and Manufacturing Platform 12
ESG Overview
Recent ESG Highlights 14 ENVIRONMENTAL STEWARDSHIP We are 'all in' on carbon negative by 2040. How? By avoiding, reducing, and storing more carbon than ever before to reach our bold climate goals. • Reduced GHG emissions by 4% • Decreased carbon footprint across all product categories • Refocused climate ambition on absolute emission reductions and carbon storage, without offsets • Continued developing our circular economy strategies, including expanding recycling capabilities in Europe. SOCIAL & COMMUNITY IMPACT We build world-class experiences for all employees and empower them to bring their whole selves to work every day. • Certified by Great Place to Work® in nine countries • Expanded employee learning and development programs • Invested in additional health and wellness resources for employee well- being • Introduced two new Inclusion Networks, open to all employees GOVERNANCE, COMPLIANCE & ETHICS We remain steadfast in conducting business ethically and responsibly and driving growth for all our stakeholders. • Established Innovation & Sustainability Committee with the Board of Directors • Published Environmental Policy to reinforcing our ongoing commitment to environmental responsibility • Updated our Audit Committee and Compensation & Talent Development Committee charters • Increased and enhanced compliance training globally
Key 2024 Sustainability Metrics 15 SCIENCE-BASED TARGETS EMISSIONS REDUCTIONS* Scope 1 Emissions Target 50% reduction 30% 28% Scope 2 Emissions Target 50% reduction 42% Scope 3 Emissions Purchased Goods & Services Target 50% reduction 17% Scope 3 Emissions Employee Commuting Target 30% reduction CARPET TILE* 3.4kg CO2e/m2 35% LVT* 6.7kg CO2e/m2 46% RUBBER* 8.5kg CO2e/m2 21% 80% RENEWABLE ENERGY of Total Energy Sourced at Manufacturing Sites Is Renewable MATERIAL INNOVATION 48% Recycled Materials 4% Bio-based Materials 52% Materials from Recycled or Bio-based Sources *Reductions versus baseline year of 2019. Product carbon footprint in kg CO2e/m2 based on cradle-to-gate sales weighted average. 76% Scope 3 Emissions Business Travel Target 30% reduction
16The linked 2024 Impact Report is not a part of, or incorporated into, this presentation. ESG at Interface We are focused on reducing our environmental footprint, making Interface a great place to work, and doing business ethically and responsibly to benefit all stakeholders – employees, customers, shareholders, and the environment. Learn more about our efforts in the ESG section of our investor site where you will find our latest 2024 Impact Report as well as other ESG Resources.
Financial Performance
Financials at a Glance 18 Currency Neutral Net Sales $371.1 +7.1% YoY Net Sales $375.5 +8.3% YoY Adjusted SG&A 24.9% % of Net Sales Adjusted Operating Income $55.9 14.9% of Net Sales Net Debt / Adjusted EBITDA 0.9x Net Sales $1,352 Adjusted EBITDA $202 14.9% of Net Sales Adjusted Operating Income $158 11.7% of Net Sales Q2 2025 LTM Adjusted Earnings Per Share $0.60 Adjusted Diluted Earnings Per Share $1.67 * See Appendix for a reconciliation of Non-GAAP figures ($ in millions, except EPS)
GAAP Financial Results 19
Adjusted Financial Results* 20 * See Appendix for a reconciliation of Non-GAAP figures
$474 $421 $423 $307 $204 $183 FY20 FY21 FY22 FY23 FY24 Q2 2025 Adjusted EBITDA Adjusted Earnings Per Diluted Share Net Debt / Adjusted EBITDANet Debt Leverage and Earnings Metrics* 21 $ in millions * See Appendix for a reconciliation of Non-GAAP figures $ in millions
Financial Policy 22 Capital allocation priorities are to invest in the business, manage our leverage ratio, and return capital to shareholders. Reinvest in the business Invest in strategic initiatives with high returns, including organic growth opportunities, innovation, manufacturing productivity, and salesforce effectiveness Manage leverage Optimize cost of capital and manage Net Debt conservatively Explore M&A Opportunities Opportunistically evaluate accretive M&A transactions that are aligned with our strategy Return excess cash to Shareholders Utilize strong free cash flow to return excess cash to shareholders Capital Deployment Philosophy
Appendix
Reconciliation of Non-GAAP Figures 24 Note: Sum of reconciling items may differ from total due to rounding of individual components ($ in millions) Q2 2024 Q2 2025 Net Sales as Reported (GAAP) $346.6 $375.5 Impact of Changes in Currency - (4.4) Currency Neutral Sales $346.6 $371.1 Gross Profit as Reported (GAAP) $122.6 $148.0 Purchase Accounting Amortization 1.3 1.4 Adjusted Gross Profit $123.9 $149.3 SG&A Expense as Reported (GAAP) $84.5 $95.9 Restructuring, Asset Impairment, Severance and Other, net (0.1) (2.5) Adjusted SG&A Expense $84.3 $93.4 LTM Q2 2024 Q2 2025 Q2 2025 Operating Income as Reported (GAAP) $38.2 $52.0 $147.1 Purchase Accounting Amortization 1.3 1.4 5.2 Cyber Event Impact 0.0 - (0.3) Restructuring, Asset Impairment, Severance and Other, net 0.1 2.5 5.7 Adjusted Operating Income $39.6 $55.9 $157.6
($ in millions) Q2 2024 Q2 2025 LTM Q2 2025 Net Income as Reported (GAAP) $22.6 $32.6 $95.8 Purchase Accounting Amortization 0.9 1.0 3.7 Cyber Event Impact 0.0 - (3.9) Restructuring, Asset Impairment, Severance and Other, net 0.1 1.9 4.3 Property Casualty Loss(1) 0.0 - (1.0) Loss on Foreign Subsidiary Liquidation(2) - - 2.2 UK Pension Surplus Tax Rate Change - - (2.5) Adjusted Net Income $23.6 $35.4 $98.4 Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023 Fiscal Year 2024 Q2 2024 Q2 2025 LTM Q2 2025 Diluted EPS as Reported (GAAP) ($1.23) $0.94 $0.33 $0.76 1.48$ 0.38$ 0.55$ $1.62 Purchase Accounting Amortization 0.07 0.07 0.06 0.06 0.06 0.02 0.02 0.06 Cyber Event Impact - - 0.07 0.01 (0.07) 0.00 - (0.07) Thailand Plant Shutdown - - 0.04 - - - - - Goodwill and Intangible Asset Impairment 2.05 - 0.58 - - - - - Restructuring, Asset Impairment, Severance and Other, net 0.23 0.16 0.13 0.07 0.03 0.00 0.03 0.07 Property Casualty Loss(1) - - - (0.01) (0.03) 0.00 - (0.02) Loss on Extinguishment of Debt 0.05 - - - - - - - Loss on Discontinuance of Interest Rate Swaps 0.05 0.06 0.04 0.01 - - - - Foreign Subsidiary Liquidation(2) - - - 0.09 0.04 - - 0.04 UK Pension Surplus Tax Rate Change - - - - (0.04) - - (0.04) FIN 48 Release on Discontinued Operations (0.22) - - - - - - - SEC Fine 0.09 - - - - - - - Warehouse Fire Loss 0.05 - - - - - - - Impact of Change in Equity Award Forfeiture Accounting 0.02 - - - - - - - Adjusted Diluted EPS $1.15 $1.23 $1.25 $1.00 $1.46 $0.40 $0.60 $1.67 Reconciliation of Non-GAAP Figures 25 Note: Sum of reconciling items may differ from total due to rounding of individual components (1) Represents insurance recovery. (2) In 2024 our Thailand subsidiary was substantially liquidated. In 2023, our Russia and Brazil foreign subsidiaries were substantially liquidated. The related cumulative translation adjustment was recognized in other expense.
($ in millions) Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023 Fiscal Year 2024 Q2 2024 Q2 2025 LTM Q2 2025 Net (Loss) Income as Reported (GAAP) ($71.9) $55.2 $19.6 $44.5 $86.9 $22.6 $32.6 $95.8 Income Tax (Benefit) Expense (7.5) 17.4 22.4 19.1 26.6 8.6 11.6 28.9 Interest Expense (including debt issuance cost amortization) 29.2 29.7 29.9 31.8 23.2 6.2 4.4 19.5 Depreciation and Amortization (excluding debt issuance cost amortization) 43.8 44.3 38.7 38.7 37.3 9.1 9.6 37.6 Share-Based Compensation Expense (0.5) 5.5 8.5 10.3 12.9 2.6 2.8 13.3 Purchase Accounting Amortization 5.5 5.6 5.0 5.2 5.2 1.3 1.4 5.2 Thailand Plant Shutdown - - 2.5 - - - - - Cyber Event Impact - - 5.1 1.1 (5.5) - - (5.1) Property Casualty Loss(1) - - - (0.5) (2.3) - - (1.4) Goodwill and Intangible Asset Impairment 121.3 - 36.2 - - - - - Restructuring, Asset Impairment, Severance and Other, net 16.7 11.8 8.2 5.6 2.5 0.1 2.5 5.7 Warehouse Fire Loss 4.2 (0.2) - - - - - - SEC Fine 5.0 - - - - - - - Loss on Foreign Subsidiary Liquidation(2) - - - 6.2 2.2 - - 2.2 Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (AEBITDA)* $145.7 $169.4 $176.1 $162.0 $189.0 $50.5 $64.8 $201.6 ($ in millions) Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023 Fiscal Year 2024 Q2 2025 Total Debt $577 $518 $520 $417 $303 $304 Less: Cash (103) (97) (98) (110) ($99) ($122) Net Debt $474 $421 $423 $307 $204 $183 Total Debt / LTM Net Income as Reported (GAAP) (8.0x) 9.4x 26.6x 9.4x 3.5x 3.2x Net Debt / LTM Adjusted EBITDA 3.2x 2.5x 2.4x 1.9x 1.1x 0.9x Note: Sum of reconciling items may differ from total due to rounding of individual components * Historical AEBITDA figures have been updated to reflect a change in depreciation and amortization values used to calculate AEBITDA. (1) Represents insurance recovery. (2) In 2024 our Thailand subsidiary was substantially liquidated and the related cumulative translation adjustment was recognized in other expense. Reconciliation of Non-GAAP Figures 26