Core Points - Insteel Industries Inc. will host its fourth quarter 2025 earnings conference call on October 16, 2025, at 10:00 a.m. ET [1] - The financial results for the fourth quarter will be released earlier that day at 6:30 a.m. ET [1] - The conference call will be available for live streaming on the company's website and will also be archived for later replay [1]

Group 1 - DMC Global (BOOM) is part of the Industrial Products group, which includes 189 companies and ranks 2 in the Zacks Sector Rank [2] - DMC Global has a Zacks Rank of 1 (Strong Buy), indicating a favorable outlook based on earnings estimate revisions [3] - The Zacks Consensus Estimate for DMC Global's full-year earnings has increased by 375% in the past quarter, reflecting improved analyst sentiment [4] Group 2 - DMC Global has returned approximately 9.1% year-to-date, outperforming the Industrial Products sector average return of 6.4% [4] - DMC Global belongs to the Industrial Services industry, which has an average gain of 5% this year, indicating better performance compared to its peers [6] - Another outperforming stock in the Industrial Products sector is Insteel Industries (IIIN), which has returned 37.3% year-to-date [5]

Core Insights - Insteel Industries reported fiscal Q3 2025 earnings with a net income of $15.2 million ($0.78 per share) and a gross margin expansion of 650 basis points to 17.1%, alongside a year-over-year shipment volume increase of 10.5% [1] Financial Performance - Gross profit rose by $15.4 million year over year to $30.8 million, with average selling prices increasing by 11.7% year over year and 8.2% sequentially from fiscal Q2 [2] - The company managed to expand spreads as the increase in average selling prices outpaced the rise in raw material costs during the quarter [3] Supply Chain and Tariff Impact - Section 232 tariffs on steel doubled from 25% to 50% in June, leading to the company importing 25% to 30% of its steel requirements, with import exposure contained at roughly 10% of revenue [4] - The company emphasized the necessity of wire rod imports due to insufficient domestic production capacity, which exposes it to elevated input cost risks and regulatory unpredictability [5] Acquisition and Integration - Recent acquisitions, particularly of Engineered Wire Products and O'Brien Wire Products, contributed to shipment growth and required operational restructuring, with $843,000 in related restructuring charges taken in the quarter [6] - Successful integration of these acquisitions is enhancing operational flexibility and productivity, allowing the company to better manage demand fluctuations [7] Future Outlook - Management expects GAAP gross margins to remain stable, supported by elevated demand and favorable inventory costs, while cutting fiscal 2025 capital expenditures guidance to $11 million from $17 million [8] - The company affirmed a robust demand environment through the fiscal year's end but did not provide formal shipment or revenue forecasts due to unpredictability around tariffs and the economic outlook [8]

[Filing Information](index=1&type=section&id=Filing%20Information) [General Information](index=1&type=section&id=General%20Information) This section details Insteel Industries Inc.'s registrant information, including filing status, stock exchange, and common shares outstanding - Insteel Industries Inc. is an Accelerated Filer[6](index=6&type=chunk) Registrant Details | Detail | Value | | :--- | :--- | | Exact Name | Insteel Industries Inc. | | State of Incorporation | North Carolina | | Commission File Number | 1-09929 | | Principal Executive Offices | 1373 Boggs Drive, Mount Airy, North Carolina 27030 | | Telephone Number | (336) 786-2141 | | Title of Class | Common Stock (No Par Value) | | Trading Symbol | IIIN | | Exchange Registered | New York Stock Exchange | | Common Stock Outstanding (as of latest practicable date) | 19,409,841 shares | [PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Item 1. Unaudited Financial Statements](index=4&type=section&id=Item%201.%20Unaudited%20Financial%20Statements) This section provides the unaudited interim consolidated financial statements and comprehensive notes on accounting policies and financial performance - The unaudited interim consolidated financial statements are prepared in accordance with GAAP and are consistent with the 2024 Form 10-K[25](index=25&type=chunk) - The company completed two significant acquisitions during the period: Engineered Wire Products, Inc. (EWP) on October 21, 2024, and O'Brien Wire Products of Texas, Inc. (OWP) on November 26, 2024[26](index=26&type=chunk)[27](index=27&type=chunk) [Consolidated Statements of Operations and Comprehensive Income](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) Consolidated Statements of Operations and Comprehensive Income (In thousands, except per share amounts) | Metric | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $179,886 | $145,775 | $470,262 | $394,894 | | Gross profit | $30,772 | $15,388 | $64,830 | $37,373 | | Earnings before income taxes | $19,769 | $8,720 | $34,556 | $19,225 | | Net earnings | $15,159 | $6,565 | $26,470 | $14,636 | | Basic EPS | $0.78 | $0.34 | $1.36 | $0.75 | | Diluted EPS | $0.78 | $0.34 | $1.35 | $0.75 | | Cash dividends declared per share | $0.03 | $0.03 | $1.09 | $2.59 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheets (In thousands) | Asset/Liability/Equity | June 28, 2025 | September 28, 2024 | | :--- | :--- | :--- | | Total current assets | $263,542 | $267,294 | | Property, plant and equipment, net | $131,083 | $125,540 | | Intangibles, net | $17,034 | $5,341 | | Goodwill | $37,755 | $9,745 | | Total assets | $471,892 | $422,552 | | Total current liabilities | $89,725 | $47,034 | | Total shareholders' equity | $356,208 | $350,855 | | Total liabilities and shareholders' equity | $471,892 | $422,552 | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows (In thousands) | Cash Flow Activity | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $44,170 | $41,978 | | Net cash used for investing activities | $(78,811) | $(17,874) | | Net cash used for financing activities | $(23,232) | $(52,029) | | Net decrease in cash and cash equivalents | $(57,873) | $(27,925) | | Cash and cash equivalents at end of period | $53,665 | $97,745 | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) Consolidated Statements of Shareholders' Equity (In thousands) | Item | Balance at Sep 28, 2024 | Net Earnings (9M 2025) | Repurchases of Common Stock (9M 2025) | Cash Dividends Declared (9M 2025) | Balance at Jun 28, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | | Common Stock (Shares) | 19,452 | - | (67) | - | 19,410 | | Common Stock (Amount) | $19,452 | - | $(67) | - | $19,410 | | Additional Paid-In Capital | $86,671 | - | $(305) | - | $88,368 | | Retained Earnings | $245,340 | $26,470 | $(1,594) | $(21,178) | $249,038 | | Accumulated Other Comprehensive Loss | $(608) | - | - | - | $(608) | | Total Shareholders' Equity | $350,855 | $26,470 | $(1,966) | $(21,178) | $356,208 | Consolidated Statements of Shareholders' Equity (In thousands) - Prior Year | Item | Balance at Sep 30, 2023 | Net Earnings (9M 2024) | Repurchases of Common Stock (9M 2024) | Cash Dividends Declared (9M 2024) | Balance at Jun 29, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Common Stock (Shares) | 19,454 | - | (58) | - | 19,445 | | Common Stock (Amount) | $19,454 | - | $(58) | - | $19,445 | | Additional Paid-In Capital | $83,832 | - | $(253) | - | $85,599 | | Retained Earnings | $278,502 | $14,636 | $(1,525) | $(50,359) | $241,254 | | Accumulated Other Comprehensive Loss | $(283) | - | - | - | $(283) | | Total Shareholders' Equity | $381,505 | $14,636 | $(1,836) | $(50,359) | $346,015 | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [(1) Basis of Presentation](index=9&type=section&id=(1)%20Basis%20of%20Presentation) - The unaudited interim consolidated financial statements are prepared in accordance with GAAP and are consistent with the 2024 Form 10-K[25](index=25&type=chunk) - The company acquired substantially all assets of Engineered Wire Products, Inc. (EWP) on October 21, 2024, and certain assets of O'Brien Wire Products of Texas, Inc. (OWP) on November 26, 2024[26](index=26&type=chunk)[27](index=27&type=chunk) [(2) Recent Accounting Pronouncements](index=9&type=section&id=(2)%20Recent%20Accounting%20Pronouncements) - ASU No. 2023-07 (Segment Reporting) will be effective for annual reporting in fiscal 2025 and interim reporting in Q1 fiscal 2026, with no material impact expected[28](index=28&type=chunk) - ASU No. 2023-09 (Income Taxes) will be effective in fiscal 2026, with no material impact expected[29](index=29&type=chunk) - ASU No. 2024-03 (Expense Disaggregation Disclosures) will be effective in fiscal 2028 for annual reporting and Q1 fiscal 2029 for interim reporting; the company is currently evaluating its impact[30](index=30&type=chunk) [(3) Business Combinations](index=9&type=section&id=(3)%20Business%20Combinations) - EWP Acquisition: Purchased substantially all assets of Engineered Wire Products, Inc. and related assets of Liberty Steel Georgetown, Inc. for an adjusted purchase price of **$67.0 million** on October 21, 2024. This acquisition expands geographic footprint and strengthens competitive position in the Midwest market[32](index=32&type=chunk)[33](index=33&type=chunk) EWP Acquisition Purchase Price Allocation (In thousands) | Item | Amount | | :--- | :--- | | Inventories | $12,066 | | Property, plant and equipment | $16,708 | | Intangible assets | $12,250 | | Total assets acquired | $41,654 | | Total liabilities assumed | $548 | | Net assets acquired | $41,106 | | Adjusted purchase price | $67,030 | | Goodwill | $25,924 | - OWP Acquisition: Purchased certain assets of O'Brien Wire Products of Texas, Inc. for **$5.1 million** on November 26, 2024. This acquisition strengthens the competitive position in the Texas market[38](index=38&type=chunk) OWP Acquisition Purchase Price Allocation (In thousands) | Item | Amount | | :--- | :--- | | Inventories | $404 | | Property, plant and equipment | $1,812 | | Intangible assets | $815 | | Total assets acquired | $3,031 | | Total liabilities assumed | $0 | | Net assets acquired | $3,031 | | Purchase price | $5,116 | | Goodwill | $2,085 | - Restructuring charges related to EWP and OWP acquisitions totaled **$843,000** for the three months ended June 28, 2025, and **$2.2 million** for the nine months ended June 28, 2025, primarily due to facility closure, equipment relocation, and asset impairment[36](index=36&type=chunk)[41](index=41&type=chunk) [(4) Revenue Recognition](index=13&type=section&id=(4)%20Revenue%20Recognition) - Revenue is recognized when performance obligations are satisfied, typically upon product shipment and control transfer. Variable consideration (discounts, rebates, returns) is included in net sales[44](index=44&type=chunk)[45](index=45&type=chunk) Net Sales by Product Line (In thousands) | Product Line | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--- | :--- | :--- | :--- | :--- | | Welded wire reinforcement | $117,691 | $84,486 | $300,165 | $223,038 | | Prestressed concrete strand | $62,195 | $61,289 | $170,097 | $171,856 | | Total | $179,886 | $145,775 | $470,262 | $394,894 | [(5) Fair Value Measurements](index=13&type=section&id=(5)%20Fair%20Value%20Measurements) - Fair value measurements are categorized into a three-level hierarchy based on input observability[48](index=48&type=chunk)[49](index=49&type=chunk)[50](index=50&type=chunk) Fair Value Measurements (In thousands) | Item | Total (June 28, 2025) | Level 1 (June 28, 2025) | Level 2 (June 28, 2025) | Total (Sep 28, 2024) | Level 1 (Sep 28, 2024) | Level 2 (Sep 28, 2024) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Cash equivalents | $53,368 | $53,368 | $- | $111,146 | $111,146 | $- | | Cash surrender value of life insurance policies | $13,183 | $- | $13,183 | $12,610 | $- | $12,610 | | Total | $66,551 | $53,368 | $13,183 | $123,756 | $111,146 | $12,610 | [(6) Intangible Assets](index=15&type=section&id=(6)%20Intangible%20Assets) Intangible Assets (In thousands) | Intangible Asset | Weighted Average Useful Life (Years) | Gross (June 28, 2025) | Accumulated Amortization (June 28, 2025) | Net Book Value (June 28, 2025) | Gross (Sep 28, 2024) | Accumulated Amortization (Sep 28, 2024) | Net Book Value (Sep 28, 2024) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Customer relationships | 18.7 | $21,455 | $(6,307) | $15,148 | $9,870 | $(5,427) | $4,443 | | Developed technology and know-how | 20.0 | $1,800 | $(975) | $825 | $1,800 | $(908) | $892 | | Non-competition agreements | 4.1 | $990 | $(218) | $772 | $60 | $(54) | $6 | | Trade name | 1.0 | $350 | $(241) | $109 | - | - | - | | Patents | 7.0 | $200 | $(20) | $180 | - | - | - | | Total | | $24,795 | $(7,761) | $17,034 | $11,730 | $(6,389) | $5,341 | - Amortization expense for intangibles was **$480,000** for the three months ended June 28, 2025 (up from $188,000 YoY), and **$1.4 million** for the nine months ended June 28, 2025 (up from $562,000 YoY)[53](index=53&type=chunk) [(7) Stock-Based Compensation](index=15&type=section&id=(7)%20Stock-Based%20Compensation) - The 2025 Equity Incentive Plan was approved, authorizing up to **800,000 shares** plus remaining shares from the 2015 Plan, with **979,000 shares** available for future grants as of June 28, 2025[54](index=54&type=chunk) Stock Option Activity (in thousands) | Metric | Options Outstanding | Weighted Average Exercise Price | | :--- | :--- | :--- | | Outstanding at September 28, 2024 | 466 | $31.03 | | Granted | 58 | $31.45 | | Exercised | (18) | $28.20 | | Outstanding at June 28, 2025 | 506 | $31.18 | | Vested and anticipated to vest | 495 | $31.16 | | Exercisable at June 28, 2025 | 304 | $30.62 | Restricted Stock Unit (RSU) Activity (Unit amounts in thousands) | Metric | Restricted Stock Units Outstanding | Weighted Average Grant Date Fair Value | | :--- | :--- | :--- | | Balance, September 28, 2024 | 119 | $32.96 | | Granted | 48 | $31.45 | | Vested | (24) | $36.51 | | Balance, June 28, 2025 | 143 | $31.85 | - Unrecognized compensation cost for unvested options is **$595,000** (expected over 1.97 years) and for unvested RSUs is **$1.3 million** (expected over 1.36 years)[55](index=55&type=chunk)[58](index=58&type=chunk) [(8) Income Taxes](index=16&type=section&id=(8)%20Income%20Taxes) - The effective income tax rate for the nine months ended June 28, 2025, was **23.4%**, a slight decrease from 23.9% in the prior year period[60](index=60&type=chunk) - A deferred tax liability (net) of **$11.1 million** was recorded as of June 28, 2025, with a valuation allowance of **$112,000** for deferred tax assets not expected to be utilized[61](index=61&type=chunk)[62](index=62&type=chunk) - The recently signed One Big Beautiful Bill Act (OBBBA) is not expected to have a material impact on the consolidated financial statements[65](index=65&type=chunk) [(9) Employee Benefit Plans](index=17&type=section&id=(9)%20Employee%20Benefit%20Plans) - The company has Supplemental Retirement Benefit Agreements (SRBAs) with certain employees, providing benefits based on service length and salary[66](index=66&type=chunk) Net Periodic Pension Cost for SRBAs (In thousands) | Component | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--- | :--- | :--- | :--- | :--- | | Interest cost | $151 | $147 | $453 | $442 | | Service cost | $69 | $63 | $207 | $189 | | Net periodic pension cost | $220 | $210 | $660 | $631 | [(10) Long-Term Debt](index=17&type=section&id=(10)%20Long-Term%20Debt) - The company has a **$100.0 million** revolving credit facility, maturing March 15, 2028, with an accordion feature for up to an additional **$50.0 million**[68](index=68&type=chunk) - As of June 28, 2025, no borrowings were outstanding, and **$98.7 million** of borrowing capacity was available[68](index=68&type=chunk) - The company was in compliance with all financial and negative covenants under the Credit Facility as of June 28, 2025[70](index=70&type=chunk) [(11) Earnings Per Share](index=18&type=section&id=(11)%20Earnings%20Per%20Share) Earnings Per Share Calculation (In thousands, except per share amounts) | Metric | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net earnings | $15,159 | $6,565 | $26,470 | $14,636 | | Basic weighted average shares outstanding | 19,476 | 19,500 | 19,485 | 19,502 | | Diluted weighted average shares outstanding | 19,553 | 19,568 | 19,544 | 19,579 | | Basic EPS | $0.78 | $0.34 | $1.36 | $0.75 | | Diluted EPS | $0.78 | $0.34 | $1.35 | $0.75 | - Antidilutive options and RSUs not included in diluted EPS were **37,000 shares** for Q3 2025 and **77,000 shares** for 9M 2025[72](index=72&type=chunk) [(12) Share Repurchases](index=18&type=section&id=(12)%20Share%20Repurchases) - The Board of Directors approved a **$25.0 million** share repurchase authorization on November 18, 2008, which remains in effect[73](index=73&type=chunk) Common Stock Repurchases (In thousands, except share amounts) | Period | Shares Repurchased | Amount | | :--- | :--- | :--- | | Three months ended June 28, 2025 | 6,402 | $224 | | Three months ended June 29, 2024 | 30,164 | $994 | | Nine months ended June 28, 2025 | 67,793 | $2,000 | | Nine months ended June 29, 2024 | 58,099 | $1,800 | - As of June 28, 2025, **$17.4 million** remained available for future share repurchases under the authorization[73](index=73&type=chunk) [(13) Other Financial Data](index=19&type=section&id=(13)%20Other%20Financial%20Data) Accounts Receivable, Net (In thousands) | Item | June 28, 2025 | September 28, 2024 | | :--- | :--- | :--- | | Accounts receivable | $83,854 | $58,689 | | Less allowance for credit losses | $(590) | $(381) | | Total | $83,264 | $58,308 | Inventories (In thousands) | Item | June 28, 2025 | September 28, 2024 | | :--- | :--- | :--- | | Raw materials | $62,401 | $36,782 | | Work in process | $8,847 | $6,139 | | Finished goods | $47,923 | $45,919 | | Total | $119,171 | $88,840 | Property, Plant and Equipment, Net (In thousands) | Item | June 28, 2025 | September 28, 2024 | | :--- | :--- | :--- | | Land and land improvements | $17,543 | $15,333 | | Buildings | $64,158 | $60,014 | | Machinery and equipment | $240,256 | $227,232 | | Construction in progress | $2,080 | $4,279 | | Less accumulated depreciation | $(192,954) | $(181,318) | | Total | $131,083 | $125,540 | [(14) Business Segment Information](index=20&type=section&id=(14)%20Business%20Segment%20Information) - The company operates as a single reportable segment, focused on the manufacture and marketing of steel wire reinforcing products for concrete construction applications[75](index=75&type=chunk) [(15) Contingencies](index=20&type=section&id=(15)%20Contingencies) - The company is involved in various lawsuits, claims, investigations, and proceedings in the ordinary course of business, but does not expect a material adverse effect on its financial position, results of operations, or cash flows[76](index=76&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, liquidity, capital resources, and market risks, analyzing results for the three and nine months ended June 28, 2025 - Insteel Industries Inc. is the nation's largest manufacturer of steel wire reinforcing products for concrete construction applications, focusing on market leadership, low-cost production, and growth opportunities[80](index=80&type=chunk) - The company completed the EWP Acquisition (**$67.0 million**) and OWP Acquisition (**$5.1 million**) in the first nine months of fiscal 2025, expanding its WWR operations and geographic footprint[81](index=81&type=chunk)[82](index=82&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=20&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) - The report contains forward-looking statements subject to numerous risks and uncertainties, including general economic conditions, construction spending, raw material costs, competitive pressures, and trade policies[77](index=77&type=chunk)[79](index=79&type=chunk)[83](index=83&type=chunk) [Overview](index=22&type=section&id=Overview) - Insteel is the largest manufacturer of steel wire reinforcing products (PC strand and WWR) for concrete construction in the U.S., selling nationwide and to a lesser extent in Canada, Mexico, and Central/South America[80](index=80&type=chunk) - Strategic focus areas include achieving market leadership, operating as the lowest cost producer, and pursuing growth opportunities within core businesses or expanding geographic footprint[80](index=80&type=chunk) - Recent acquisitions (EWP and OWP) were made to consolidate WWR operations and strengthen competitive positions in the Midwest and Texas markets[81](index=81&type=chunk)[82](index=82&type=chunk) [Statements of Operations – Selected Data](index=23&type=section&id=Statements%20of%20Operations%20%E2%80%93%20Selected%20Data) Statements of Operations – Selected Data (Dollars in thousands) | Metric | Q3 FY25 | Change (YoY) | Q3 FY24 | 9M FY25 | Change (YoY) | 9M FY24 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net sales | $179,886 | 23.4% | $145,775 | $470,262 | 19.1% | $394,894 | | Gross profit | $30,772 | 100.0% | $15,388 | $64,830 | 73.5% | $37,373 | | Percentage of net sales | 17.1% | | 10.6% | 13.8% | | 9.5% | | Selling, general and administrative expense | $10,607 | 34.6% | $7,879 | $29,294 | 32.4% | $22,121 | | Percentage of net sales | 5.9% | | 5.4% | 6.2% | | 5.6% | | Restructuring charges, net | $843 | N/M | $- | $2,201 | N/M | $- | | Acquisition costs | $27 | N/M | $- | $325 | N/M | $- | | Interest income | $(472) | (62.1%) | $(1,245) | $(1,574) | (61.1%) | $(4,051) | | Effective income tax rate | 23.3% | | 24.7% | 23.4% | | 23.9% | | Net earnings | $15,159 | 130.9% | $6,565 | $26,470 | 80.9% | $14,636 | [Third Quarter of Fiscal 2025 Compared to Third Quarter of Fiscal 2024](index=23&type=section&id=Third%20Quarter%20of%20Fiscal%202025%20Compared%20to%20Third%20Quarter%20of%20Fiscal%202024) - Net sales increased **23.4%** to **$179.9 million**, driven by an **11.7%** increase in average selling prices and a **10.5%** increase in shipments, primarily due to acquisitions and improved demand[85](index=85&type=chunk) - Gross profit surged **100.0%** to **$30.8 million** (**17.1%** of net sales), mainly due to higher spreads between selling prices and raw material costs[86](index=86&type=chunk) - SG&A expense rose **34.6%** to **$10.6 million** (**5.9%** of net sales), primarily due to higher compensation expense and amortization from acquired intangible assets[87](index=87&type=chunk) - Restructuring charges of **$843,000** were incurred, related to the closure of the Warren, Ohio facility and WWR operations consolidation[88](index=88&type=chunk) - Net earnings increased **130.9%** to **$15.2 million** (**$0.78 per share**)[91](index=91&type=chunk) [First Nine Months of Fiscal 2025 Compared to First Nine Months of Fiscal 2024](index=24&type=section&id=First%20Nine%20Months%20of%20Fiscal%202025%20Compared%20to%20First%20Nine%20Months%20of%20Fiscal%202024) - Net sales increased **19.1%** to **$470.3 million**, reflecting a **16.5%** increase in shipments and a **2.2%** increase in average selling prices, driven by increased demand and current year acquisitions[92](index=92&type=chunk) - Gross profit increased **73.5%** to **$64.8 million** (**13.8%** of net sales), primarily due to higher spreads between average selling prices and raw material costs[93](index=93&type=chunk) - SG&A expense increased **32.4%** to **$29.3 million** (**6.2%** of net sales), mainly due to higher compensation, changes in life insurance cash surrender value, increased amortization, and employee benefit expenses[94](index=94&type=chunk) - Restructuring charges of **$2.2 million** were incurred, related to the Warren, Ohio facility closure and WWR operations consolidation[95](index=95&type=chunk) - Acquisition costs of **$325,000** were incurred for legal, accounting, and professional fees related to the EWP and OWP acquisitions[96](index=96&type=chunk) - Net earnings increased **80.9%** to **$26.5 million** (**$1.35 per diluted share**)[99](index=99&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) Selected Financial Data (Dollars in thousands) | Metric | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $44,170 | $41,978 | | Net cash used for investing activities | $(78,811) | $(17,874) | | Net cash used for financing activities | $(23,232) | $(52,029) | | Net working capital | $173,817 | $212,409 | | Total debt | $- | $- | | Shareholders' equity | $356,208 | $346,015 | - Operating activities provided **$44.2 million** of cash in 9M 2025, primarily from net earnings, partially offset by a net increase in working capital due to higher accounts receivable and inventories[102](index=102&type=chunk) - Investing activities used **$78.8 million** of cash in 9M 2025, significantly higher than prior year, mainly due to the EWP (**$67.0 million**) and OWP (**$5.1 million**) acquisitions[105](index=105&type=chunk) - Financing activities used **$23.2 million** of cash in 9M 2025, a decrease from **$52.0 million** in 9M 2024, primarily due to lower dividend payments (special dividend of $1.00/share vs. $2.50/share)[107](index=107&type=chunk) - The company has a **$100.0 million** revolving credit facility with **$98.7 million** available capacity as of June 28, 2025, and believes it has sufficient liquidity for foreseeable requirements[109](index=109&type=chunk)[110](index=110&type=chunk) [Seasonality and Cyclicality](index=27&type=section&id=Seasonality%20and%20Cyclicality) - Demand for products is seasonal, typically highest in the third and fourth fiscal quarters due to favorable construction weather, and cyclical based on overall economic conditions[112](index=112&type=chunk) [Impact of Inflation](index=27&type=section&id=Impact%20of%20Inflation) - The company faces inflationary risks from fluctuations in hot-rolled carbon steel wire rod, labor, freight, and energy costs[113](index=113&type=chunk) - In 9M 2025, the company successfully implemented price increases to recover escalating raw material costs, but future ability to do so depends on market conditions[113](index=113&type=chunk) [Contractual Obligations](index=27&type=section&id=Contractual%20Obligations) - No material changes in contractual obligations and commitments from the 2024 Annual Report, other than those in the ordinary course of business[114](index=114&type=chunk) [Critical Accounting Estimates](index=27&type=section&id=Critical%20Accounting%20Estimates) - As of June 28, 2025, none of the company's accounting estimates were deemed critical for the presented periods, consistent with the 2024 Annual Report[115](index=115&type=chunk) [Recent Accounting Pronouncements](index=27&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 2 of the Notes to Consolidated Financial Statements for details on recently issued accounting pronouncements[116](index=116&type=chunk) [Outlook](index=27&type=section&id=Outlook) - The company maintains a confident business outlook for Q4 fiscal 2025, expecting improved demand, increased shipments, better operating rates, and lower unit manufacturing costs[117](index=117&type=chunk) - Public nonresidential construction outlook remains strong, supported by federal investment (Infrastructure Investment and Jobs Act)[117](index=117&type=chunk) - Expansion of Section 232 tariffs to **50%** on derivative steel products like PC strand is expected to level the competitive playing field, but also adds upward pressure on raw material costs[118](index=118&type=chunk) - Management is focused on disciplined pricing, managing tariff exposure, cost control, realizing acquisition synergies, and evaluating future acquisition opportunities[119](index=119&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to commodity prices, interest rates, and foreign exchange risks, and its management strategies - The company manages market risk exposure through internal policies and procedures, and derivative financial instruments when appropriate, but does not use them for trading[121](index=121&type=chunk) [Commodity Prices](index=28&type=section&id=Commodity%20Prices) - The company is significantly exposed to fluctuations in the cost and availability of hot-rolled carbon steel wire rod, its primary raw material[122](index=122&type=chunk) - A **10%** increase in wire rod price would result in a **$27.0 million** decrease in pre-tax earnings, assuming no corresponding change in selling prices[122](index=122&type=chunk) - The company does not use derivative commodity instruments for hedging wire rod prices as they are not currently available[122](index=122&type=chunk) [Interest Rates](index=28&type=section&id=Interest%20Rates) - Future borrowings under the Credit Facility are subject to variable interest rates, making them sensitive to changes in interest rates[123](index=123&type=chunk) [Foreign Exchange Exposure](index=29&type=section&id=Foreign%20Exchange%20Exposure) - Historically, foreign currency exposures related to non-U.S. dollar transactions have not been material, and hedging decisions are made on a case-by-case basis[124](index=124&type=chunk) [Item 4. Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) This section reports on the effectiveness of the company's disclosure controls and internal control over financial reporting - The principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of June 28, 2025[125](index=125&type=chunk) - There has been no material change in internal control over financial reporting during the quarter ended June 28, 2025[126](index=126&type=chunk) [PART II – OTHER INFORMATION](index=29&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) This section provides an update on the company's ongoing legal proceedings - The company is involved in various lawsuits, claims, investigations, and proceedings in the ordinary course of business[128](index=128&type=chunk) - The ultimate costs to resolve these matters are not anticipated to have a material adverse effect on the company's financial position, results of operations, or cash flows[128](index=128&type=chunk) [Item 1A. Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) This section addresses potential risks and uncertainties impacting the company's business, financial condition, and future results - No material changes to the risk factors previously disclosed in the Quarterly Report on Form 10-Q for March 29, 2025, and the 2024 Annual Report[129](index=129&type=chunk) - Additional unknown or immaterial risks could still have a material adverse effect[129](index=129&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=29&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section summarizes the company's common stock repurchase activities during the quarter Common Stock Repurchases for the Three Months Ended June 28, 2025 (In thousands except share and per share amounts) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plan or Program | Maximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plan or Program | | :--- | :--- | :--- | :--- | :--- | | March 30, 2025 - May 3, 2025 | 1,200 | $32.85 | 1,200 | $17,608 | | May 4, 2025 - May 31, 2025 | 5,102 | $35.46 | 5,102 | $17,427 | | June 1, 2025 - June 28, 2025 | 100 | $34.82 | 100 | $17,423 | | Total | 6,402 | | 6,402 | | - The repurchases were made under the **$25.0 million** share repurchase authorization announced on November 18, 2008[131](index=131&type=chunk)[132](index=132&type=chunk) [Item 5. Other Information](index=31&type=section&id=Item%205.%20Other%20Information) This section provides information regarding insider trading arrangements - No directors or Section 16 officers adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the fiscal quarter ended June 28, 2025[133](index=133&type=chunk) [Item 6. Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists all documents filed as exhibits to the Quarterly Report on Form 10-Q - Exhibits include the Asset Purchase Agreement for EWP, Restated Articles of Incorporation, Bylaws, CEO/CFO Certifications (Sarbanes-Oxley Act), and iXBRL financial information[136](index=136&type=chunk) [SIGNATURES](index=32&type=section&id=SIGNATURES) [Signature](index=32&type=section&id=Signature) This section contains the official signature confirming the report's submission - The report was signed by Scot R. Jafroodi, Vice President, Chief Financial Officer and Treasurer, on behalf of Insteel Industries Inc. on July 17, 2025[138](index=138&type=chunk)

Financial Data and Key Metrics Changes - Net earnings for Q3 2025 increased to $15.2 million or $0.78 per share compared to $6.6 million or $0.34 per share in the prior year, with adjusted earnings at $0.81 per share excluding non-recurring charges [6][12] - Average selling prices rose 11.7% year over year and 8.2% sequentially from Q2 2025, reflecting pricing actions taken to manage rising raw material costs [6][10] - Gross profit for the quarter increased to $30.8 million, with gross margin expanding by 650 basis points to 17.1% [9][10] Business Line Data and Key Metrics Changes - Shipments for the quarter increased by 10.5% year over year and 3.5% sequentially, driven by recent acquisitions and improving demand in construction markets [8] - SG&A expenses rose to $10.6 million or 5.9% of net sales compared to $7.9 million or 5.4% of net sales in the prior year, primarily due to increased compensation expenses [10][11] Market Data and Key Metrics Changes - The U.S. wire rod market remains tight, with public prices for steel wire rod increasing by approximately $190 per ton since January [7] - The architectural billing index increased to 47.2, indicating early signs of stabilization in nonresidential construction, although it remains below the growth threshold [15] - Nonresidential construction spending declined by 3.5% compared to the prior year, reflecting a softer demand environment [18] Company Strategy and Development Direction - The company aims to capitalize on improving demand trends while managing working capital and maintaining strong customer relationships [19] - The administration's tariff strategy is seen as a work in progress, with only about 10% of revenue directly affected by imports, indicating a cautious approach to import competition [21][22] - The company plans to continue its share buyback program and has reduced its full-year capital expenditure target to $11 million from $17 million [14][29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about ongoing demand recovery despite macroeconomic uncertainties, noting that customer confidence remains strong [20] - The company is well-positioned to navigate near-term challenges while building long-term value for shareholders [19] - Management acknowledged risks related to the administration's tariff policies and the future performance of the U.S. economy but remains focused on maximizing shipments and optimizing costs [30] Other Important Information - The effective tax rate for the quarter fell to 23.3% from 24.7% a year ago, with expectations to remain around 23.4% for the remainder of the year [12] - The company ended the quarter with $53.7 million in cash and is debt-free, providing financial flexibility for growth opportunities [14] Q&A Session Summary Question: Have quoting levels for newer projects followed the same trajectory as strong business activity? - Management noted that raw material constraints have caused backlogs to grow, but they remain optimistic about project inquiries, particularly in data centers [35][36] Question: What is the potential timeline to resolve the recent Section 232 tariff disconnect? - Management believes the administration's intent is for the tariff to be on the full value of the product, and they are actively engaging with commerce to address ambiguities [37][38] Question: How is the integration of engineered wire products progressing? - Management expressed satisfaction with the integration, noting that the facility is productive and they are learning from each other [40][41] Question: Do you anticipate being able to maintain current margin levels? - Management expects to pass through higher costs and does not anticipate margin deterioration in the current market [54] Question: What needs to occur for the housing market to improve? - Management indicated that while they do not solely rely on housing, infrastructure investments are expected to drive demand for their products [56] Question: What is the outlook for cash balance at year-end? - Management stated that they are not dissatisfied with the current cash balance and will assess the situation as the year progresses [57] Question: Can you quantify the domestic wire rod supply shortage? - Management estimated that they will have imported 25% to 30% of their steel requirements, approximating the domestic shortfall [58]

Financial Data and Key Metrics Changes - Net earnings for Q3 2025 increased to $15.2 million or $0.78 per share compared to $6.6 million or $0.34 per share in the prior year, with adjusted earnings at $0.81 per share excluding non-recurring charges [4][10] - Average selling prices rose 11.7% year over year and 8.2% sequentially from Q2 2025, reflecting pricing actions taken to manage rising raw material costs [4][6] - Gross profit for the quarter increased to $30.8 million, with gross margin expanding by 650 basis points to 17.1% [6][7] Business Line Data and Key Metrics Changes - Shipments for the quarter increased by 10.5% year over year and 3.5% sequentially, driven by acquisitions and improving demand in construction markets [6][10] - SG&A expenses rose to $10.6 million or 5.9% of net sales compared to $7.9 million or 5.4% in the prior year, primarily due to increased compensation expenses [8][9] Market Data and Key Metrics Changes - The U.S. wire rod market remains tight, with public prices for steel wire rod increasing by approximately $190 per ton since January [5] - The architectural billing index increased to 47.2, indicating early signs of stabilization, while the Dodge Amendment Index rose 6.8% month over month to 225.1, suggesting a growing pipeline for nonresidential construction [13][14] Company Strategy and Development Direction - The company aims to capitalize on improving demand trends while managing working capital and maintaining strong customer relationships [17] - The administration's tariff strategy is seen as a work in progress, with only about 10% of revenue directly affected by imports, indicating a cautious approach to import competition [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about ongoing demand recovery despite macroeconomic uncertainties, noting that customer confidence remains strong [19] - The company is well-positioned to navigate near-term challenges while pursuing growth opportunities, both organic and through acquisitions [29] Other Important Information - The effective tax rate for the quarter fell to 23.3%, with expectations to remain around 23.4% for the remainder of the year [10] - The company ended the quarter with $53.7 million in cash and is debt-free, providing financial flexibility for growth opportunities [12] Q&A Session Summary Question: Have quoting levels for newer projects followed the strong business activity trajectory? - Management noted that raw material constraints have caused backlogs to grow, but they remain optimistic about overall market conditions [35] Question: What is the potential timeline to resolve the recent Section 232 tariff disconnect? - Management believes the administration's intent is for the tariff to be on the full value of the product, and they are actively engaging with the Department of Commerce on this matter [37] Question: How is the integration of Engineered Wire Products going? - Management expressed satisfaction with the integration process, noting that they are learning from the acquired facility and seeing positive operational results [39] Question: Do you anticipate being able to maintain current margin levels? - Management expects to pass through higher costs and does not anticipate margin deterioration in the current market environment [53] Question: What needs to occur for the housing market to improve? - Management indicated that while they do not solely rely on housing, infrastructure investments are expected to drive demand for their products [55] Question: What is the outlook for cash balance at year-end? - Management stated that they are not dissatisfied with the current cash position and will assess the year-end outlook as they approach the end of the fiscal year [56] Question: Can you quantify the domestic wire rod supply shortage? - Management estimated that they will have imported 25% to 30% of their steel requirements, approximating the domestic shortfall [57]

Business Overview - The company is the nation's largest manufacturer of steel wire reinforcing products[8] - The company operates 11 facilities[9] - PC Strand accounts for 58% of sales, while Welded Wire Reinforcement accounts for 42%[13] - Distributors account for 70% of sales, while Rebar Fabricators, Contractors, and Concrete Product Manufacturers account for 30%[17] - Residential Construction accounts for 85% of sales, while Nonresidential Construction accounts for 15%[17] Growth Strategy - The company focuses on converting rebar users to ESM, which requires fewer tons of steel due to its higher yield strength (80,000 PSI for ESM versus 60,000 PSI for rebar)[47] - The company acquired Engineered Wire Products for $67 million in October 2024 and O'Brien Wire Products for $5.1 million in November 2024[49] Financials - As of June 28, 2025, the company was debt-free with $53.7 million of cash and no borrowings outstanding on its $100 million revolving credit facility[94] - Capital expenditures are expected to total approximately $11 million in fiscal year 2025[90] - The company repurchased $2 million YTD in FY 2025 and $1.8 million in FY 2024[100] Market Outlook - In June, the Dodge Momentum Index rose 6.8% month-over-month and is 20% higher than June of last year[104]

[News Release and Company Overview](index=1&type=section&id=News%20Release%20and%20Company%20Overview) Insteel Industries Inc. announced Q3 2025 financial results and detailed its business as the largest US steel wire reinforcing products manufacturer [Introduction](index=1&type=section&id=Introduction) Insteel Industries Inc., the largest US manufacturer of steel wire reinforcing products for concrete construction, announced its financial results for the third quarter of fiscal 2025, ended June 28, 2025 - Insteel Industries Inc. announced financial results for its third quarter of fiscal 2025 ended June 28, 2025[3](index=3&type=chunk) - Insteel is the **largest manufacturer of steel wire reinforcing products** for concrete construction applications in the United States[3](index=3&type=chunk) [About Insteel](index=3&type=section&id=About%20Insteel) Insteel, the nation's largest manufacturer of steel wire reinforcing products for concrete construction, produces prestressed concrete strand and welded wire reinforcement primarily for nonresidential construction, operating eleven US facilities - Insteel is the nation's **largest manufacturer of steel wire reinforcing products** for concrete construction applications[17](index=17&type=chunk) - The company manufactures and markets **prestressed concrete strand and welded wire reinforcement**, including engineered structural mesh (ESM), concrete pipe reinforcement, and standard welded wire reinforcement[17](index=17&type=chunk) - Insteel's products are sold primarily to manufacturers of concrete products and concrete contractors for nonresidential construction, operating **eleven manufacturing facilities** in the United States[17](index=17&type=chunk) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) This section summarizes Insteel's strong financial performance for Q3 and the first nine months of fiscal 2025, showing significant growth in net earnings and sales [Third Quarter 2025 Highlights](index=1&type=section&id=Third%20Quarter%202025%20Highlights) Insteel reported significant increases in Q3 2025 net earnings and net sales, driven by higher shipments and wider spreads, with expanded gross profit and strong operating cash flow Third Quarter 2025 Financial Performance | Metric | Q3 2025 | Q3 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | Net earnings | $15.2 million | $6.6 million | +130.3% | | EPS | $0.78 | $0.34 | +129.4% | | Net sales | $179.9 million | $145.8 million | +23.4% | | Gross profit | $30.8 million | $15.4 million | +100.0% | | Gross margin | 17.1% | 10.6% | +6.5 pp | | Operating cash flow | $28.2 million | $18.7 million | +50.8% | - Q3 2025 results include **$0.9 million in restructuring charges and acquisition-related costs**, reducing net earnings per share by **$0.03**[4](index=4&type=chunk) - The rise in net sales was driven by an **11.7% rise in average selling prices** and a **10.5% increase in shipments**[5](index=5&type=chunk) - Sequentially, average selling prices increased by **8.2%** and shipments were up **3.5%** from Q2 fiscal 2025[5](index=5&type=chunk) [Nine Month 2025 Highlights](index=2&type=section&id=Nine%20Month%202025%20Highlights) For the first nine months of fiscal 2025, Insteel achieved substantial growth in net earnings and net sales, driven by increased shipments and improved market conditions, alongside expanded gross profit and slightly increased operating cash flow Nine Month 2025 Financial Performance | Metric | 9M 2025 | 9M 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | Net earnings | $26.5 million | $14.6 million | +81.5% | | Diluted EPS | $1.35 | $0.75 | +80.0% | | Net sales | $470.3 million | $394.9 million | +19.1% | | Gross profit | $64.8 million | $37.4 million | +73.3% | | Gross margin | 13.8% | 9.5% | +4.3 pp | | Operating cash flow | $44.2 million | $42.0 million | +5.2% | - Nine-month earnings reflect **$2.5 million of restructuring charges and acquisition-related costs**, reducing net earnings per share by **$0.10**[10](index=10&type=chunk) - Net sales increased due to a **16.5% increase in shipments** and a **2.2% rise in average selling prices**[11](index=11&type=chunk) [Detailed Financial Results](index=4&type=section&id=Detailed%20Financial%20Results) This section provides a detailed breakdown of Insteel's consolidated statements of operations for the third quarter and first nine months of fiscal 2025 [Consolidated Statements of Operations - Third Quarter 2025](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20-%20Third%20Quarter%202025) The consolidated statements of operations reveal a strong third quarter for Insteel, with net sales increasing by **23.4%** and net earnings more than doubling year-over-year, as gross profit margin significantly improved to **17.1%** Consolidated Statements of Operations (Q3) | Metric (in thousands) | Q3 2025 | Q3 2024 | YoY Change | | :-------------------- | :------ | :------ | :--------- | | Net sales | $179,886 | $145,775 | +23.4% | | Cost of sales | $149,114 | $130,387 | +14.4% | | Gross profit | $30,772 | $15,388 | +100.0% | | Gross margin | 17.1% | 10.6% | +6.5 pp | | Selling, general and administrative expense | $10,607 | $7,879 | +34.6% | | Restructuring charges, net | $843 | $0 | N/A | | Acquisition costs | $27 | $0 | N/A | | Net earnings | $15,159 | $6,565 | +130.9% | | Diluted EPS | $0.78 | $0.34 | +129.4% | [Consolidated Statements of Operations - Nine Month 2025](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20-%20Nine%20Month%202025) For the first nine months of fiscal 2025, Insteel's net sales grew by **19.1%** and net earnings increased by **80.9%** year-over-year, with gross profit margin expanding to **13.8%** Consolidated Statements of Operations (Nine Months) | Metric (in thousands) | 9M 2025 | 9M 2024 | YoY Change | | :-------------------- | :------ | :------ | :--------- | | Net sales | $470,262 | $394,894 | +19.1% | | Cost of sales | $405,432 | $357,521 | +13.4% | | Gross profit | $64,830 | $37,373 | +73.5% | | Gross margin | 13.8% | 9.5% | +4.3 pp | | Selling, general and administrative expense | $29,294 | $22,121 | +32.4% | | Restructuring charges, net | $2,201 | $0 | N/A | | Acquisition costs | $325 | $0 | N/A | | Net earnings | $26,470 | $14,636 | +80.9% | | Diluted EPS | $1.35 | $0.75 | +80.0% | [Capital Allocation and Liquidity](index=2&type=section&id=Capital%20Allocation%20and%20Liquidity) This section details Insteel's capital allocation strategies and strong liquidity position, including cash balances and capital expenditures [Capital Allocation and Liquidity Details](index=2&type=section&id=Capital%20Allocation%20and%20Liquidity%20Details) Insteel maintained a strong liquidity position, ending the quarter debt-free with **$53.7 million** in cash, while nine-month capital expenditures decreased significantly, with full-year outlays focused on cost and productivity improvements Capital Expenditures | Metric | 9M 2025 | 9M 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | Capital expenditures | $6.5 million | $17.5 million | -62.9% | - Insteel ended the quarter **debt-free with $53.7 million of cash** and no borrowings on its **$100.0 million revolving credit facility**[13](index=13&type=chunk) - Capital outlays for fiscal 2025 are expected to total up to approximately **$11.0 million**, focused on cost, productivity, and maintenance[12](index=12&type=chunk) - The company's investment program was temporarily slowed by integration activities related to recent acquisitions during fiscal 2025[12](index=12&type=chunk) [Outlook](index=2&type=section&id=Outlook) This section outlines Insteel's business outlook, addressing challenges like supply chain disruptions and rising costs, while highlighting optimism from acquisitions and improved customer demand [Business Outlook and Challenges](index=2&type=section&id=Business%20Outlook%20and%20Challenges) Insteel faced near-term challenges from reduced domestic steel wire rod capacity, escalating prices, and increased Section 232 tariffs, yet remains cautiously optimistic, leveraging acquisitions for performance and noting improved customer demand - Experienced sourcing challenges in Q3 due to **reduced domestic steel wire rod capacity**, disrupting production and impacting customer demand[14](index=14&type=chunk) - Turned to international markets to fill the supply gap, expecting to ease supply constraints into Q4[14](index=14&type=chunk) - Experienced **sharply escalating wire rod prices** in domestic and international markets, exacerbated by doubled Section 232 tariffs on steel imports[15](index=15&type=chunk) - Recent acquisitions are meaningfully contributing to performance by enhancing **shipment volumes** and improving competitive positioning[15](index=15&type=chunk) - Customers express optimism and demand has improved, despite cautious broader macroeconomic indicators for construction[15](index=15&type=chunk) [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) This section provides details for Insteel's upcoming conference call to discuss its third-quarter financial results and how to access the webcast [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) Insteel scheduled a conference call for July 17, 2025, at 10:00 a.m. ET to discuss its third-quarter financial results, with a live webcast and archived replay available on its investor relations website - Insteel will hold a conference call at **10:00 a.m. ET on July 17, 2025**, to discuss its Q3 financial results[16](index=16&type=chunk) - A live webcast of this call can be accessed on Insteel's website at https://investor.insteel.com and will be archived for replay[16](index=16&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=3&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section advises that the news release contains forward-looking statements subject to risks and uncertainties, with no obligation for public updates unless legally required [Forward-Looking Statements and Risks](index=3&type=section&id=Forward-Looking%20Statements%20and%20Risks) This section highlights that the news release contains forward-looking statements subject to various risks and uncertainties, detailed in the company's Form 10-K and other SEC filings, with no public update obligation unless legally required - This news release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995, identified by specific terminology[18](index=18&type=chunk) - These statements are subject to risks and uncertainties detailed in the **Annual Report on Form 10-K** for the year ended September 28, 2024, and other SEC filings[18](index=18&type=chunk)[20](index=20&type=chunk) - The company does not undertake to publicly release revisions to these forward-looking statements, except as legally required[19](index=19&type=chunk) - Risks include general economic and competitive conditions, changes in construction spending, raw material cost fluctuations, trade policy changes, and other 'Risk Factors' in SEC filings[20](index=20&type=chunk) [Consolidated Financial Statements](index=4&type=section&id=Consolidated%20Financial%20Statements) This section presents Insteel's unaudited consolidated statements of operations, balance sheets, and cash flows for the specified periods [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The unaudited consolidated statements of operations present the company's revenues, costs, and earnings for the three and nine months ended June 28, 2025, and June 29, 2024, showing significant year-over-year improvements in net sales, gross profit, and net earnings Consolidated Statements of Operations (Unaudited) | Metric (in thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net sales | $179,886 | $145,775 | $470,262 | $394,894 | | Cost of sales | $149,114 | $130,387 | $405,432 | $357,521 | | Gross profit | $30,772 | $15,388 | $64,830 | $37,373 | | Selling, general and administrative expense | $10,607 | $7,879 | $29,294 | $22,121 | | Restructuring charges, net | $843 | - | $2,201 | - | | Acquisition costs | $27 | - | $325 | - | | Earnings before income taxes | $19,769 | $8,720 | $34,556 | $19,225 | | Income taxes | $4,610 | $2,155 | $8,086 | $4,589 | | Net earnings | $15,159 | $6,565 | $26,470 | $14,636 | | Basic EPS | $0.78 | $0.34 | $1.36 | $0.75 | | Diluted EPS | $0.78 | $0.34 | $1.35 | $0.75 | | Cash dividends declared per share | $0.03 | $0.03 | $1.09 | $2.59 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) The unaudited consolidated balance sheets provide a snapshot of Insteel's financial position, showing total assets, liabilities, and shareholders' equity, with increased cash and cash equivalents and a debt-free status as of June 28, 2025 Consolidated Balance Sheets (Unaudited) | Metric (in thousands) | June 28, 2025 | March 29, 2025 | December 28, 2024 | September 28, 2024 | June 29, 2024 | | :-------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | Cash and cash equivalents | $53,665 | $28,424 | $35,951 | $111,538 | $97,745 | | Total current assets | $263,542 | $210,785 | $192,485 | $267,294 | $257,124 | | Total assets | $471,892 | $421,860 | $404,699 | $422,552 | $414,615 | | Total current liabilities | $89,725 | $54,425 | $47,084 | $47,034 | $44,715 | | Total liabilities and shareholders' equity | $471,892 | $421,860 | $404,699 | $422,552 | $414,615 | - Accounts receivable, net, increased to **$83,264 thousand** as of June 28, 2025, from **$61,234 thousand** a year prior[24](index=24&type=chunk) - Inventories increased to **$119,171 thousand** as of June 28, 2025, from **$89,379 thousand** a year prior[24](index=24&type=chunk) - Accounts payable increased to **$73,424 thousand** as of June 28, 2025, from **$34,827 thousand** a year prior[24](index=24&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The unaudited consolidated statements of cash flows detail cash generated from operating, investing, and financing activities, with significant operating cash and substantial investing outflows due to business acquisitions Consolidated Statements of Cash Flows (Unaudited) | Metric (in thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net cash provided by operating activities | $28,199 | $18,738 | $44,170 | $41,978 | | Net cash used for investing activities | $(2,167) | $(3,259) | $(78,811) | $(17,874) | | Net cash used for financing activities | $(791) | $(1,679) | $(23,232) | $(52,029) | | Net increase (decrease) in cash and cash equivalents | $25,241 | $13,800 | $(57,873) | $(27,925) | | Cash and cash equivalents at end of period | $53,665 | $97,745 | $53,665 | $97,745 | - Acquisition of businesses resulted in a significant cash outflow of **$72,056 thousand** for the nine months ended June 28, 2025[26](index=26&type=chunk) - Capital expenditures for the nine months ended June 28, 2025, were **$6,490 thousand**, a decrease from **$17,460 thousand** in the prior year[26](index=26&type=chunk) - Cash dividends paid for the nine months ended June 28, 2025, were **$21,178 thousand**, a decrease from **$50,359 thousand** in the prior year[26](index=26&type=chunk)

Business Overview - Insteel Industries is the nation's largest manufacturer of steel wire reinforcing products for concrete construction applications[6] - In 2015, Welded Wire Reinforcement (WWR) accounted for 57% of sales, while PC Strand accounted for 43%[5] - Nonresidential construction represents 85% of sales, while residential construction accounts for 15%[9] - Concrete product manufacturers account for 70% of sales, while distributors, rebar fabricators, and contractors make up 30%[10] Growth Strategy & Acquisitions - Existing facilities are capable of generating over $700 million of annualized revenues at current ASPs with minimal incremental capex required[31] - In November 2010, Insteel acquired Ivy Steel & Wire, Inc for $50.3 million[34] - In August 2014, Insteel acquired American Spring Wire Corporation for $33.5 million[37] - Closure of Newnan facility in March 2015 is expected to generate approximately $3.0 million of annualized cost savings[106] Financial Performance - Fiscal Year 2014 net sales were $409 million[29] - EBITDA for 2015 was $46.7 million, representing 10.4% of EBITDA Margin[54] - Capital expenditures are expected to increase to $20.0 million in 2016, including $9.0 million related to the expansion of the Houston PC strand facility[71] - As of October 3, 2015, Insteel was debt-free with $33.3 million of cash and cash equivalents[74] Market Outlook - Total construction spending for 2014 was up 4.8% from the prior year[80] - Total construction spending for August YTD 2015 was up 9.8% from the prior year[84] - Architecture Billings Index rebounded to 53.7 in September 2015[101] - Dodge Momentum Index in September 2015 was up 5.8% from the prior month and 20.9% from a year ago[104]

Business Overview - Insteel Industries is the nation's largest manufacturer of steel wire reinforcing products for concrete construction applications[6] - The company manufactures and markets welded wire reinforcement (WWR) which accounts for 61% of 2016 sales, and prestressed concrete strand (PC strand) products which accounts for 39% of 2016 sales[5] - Nonresidential construction accounts for 85% of sales, while residential construction accounts for 15% of sales[9] - Concrete product manufacturers account for 70% of sales, while distributors, rebar fabricators, and contractors account for 30% of sales[10] Growth Strategy - Existing facilities are capable of generating over $700 million of annualized revenues at current ASPs with minimal incremental capex required[31] - In November 2010, Insteel acquired Ivy Steel & Wire, Inc for $50.3 million[34] - In August 2014, Insteel acquired American Spring Wire Corporation for $33.5 million[37] Financial Performance - FY2016 net sales were $418.5 million[40] - The company's gross profit for 2016 was $85.2 million, representing a gross margin of 20.4%[51] - EBITDA for 2016 was $73.1 million, with an EBITDA margin of 17.5%[55] - As of October 1, 2016, Insteel was debt-free with $58.9 million of cash and cash equivalents[77] Market Conditions and Outlook - Total construction spending for 2015 was up 10.6% from the prior year[83] - Total construction spending for August YTD 2016 was up 4.9% from the prior year[86] - The FAST Act authorizes $305 billion of funding over a five-year period, including $226.2 billion for federal highway investment[106] - The first phase of the Texas PC strand expansion is expected to reduce annual operating costs by $5.0 million[107]