NEWS RELEASE Matthews International Corporation Corporate Office Two NorthShore Center Pittsburgh, PA 15212-5851 Phone: (412) 442-8200 May 2, 2024 Contact: Steven F. Nicola William D. Wilson Chief Financial Officer and Secretary Senior Director, Corporate Development MATTHEWS INTERNATIONAL REPORTS RESULTS FOR FISCAL 2024 SECOND QUARTER Fiscal 2024 Second Quarter Financial Highlights: PITTSBURGH, PA, May 2, 2024 - Matthews International Corporation (NASDAQ GSM: MATW) today announced financial results for its ...

 Fiscal 2024 Second Quarter Financial Highlights: Outstanding debt reduced by $19.6 million; net debt lower by $27.2 millionGAAP earnings per share of $0.29, consistent with a year agoNon-GAAP EPS increased to $0.69, compared to $0.65 a year agoSGK reports current quarter sales and adjusted EBITDA higher than a year agoEnergy storage sales also higher than last year; reflects orders from multiple customers PITTSBURGH, May 02, 2024 (GLOBE NEWSWIRE) -- Matthews International Corporation (NASDAQ GSM: MATW) tod ...

PITTSBURGH, April 26, 2024 (GLOBE NEWSWIRE) -- Matthews International Corporation (NASDAQ GSM: MATW) ("Matthews" or the "Company") today announced that Francis Wlodarczyk has been appointed to the Company's Board of Directors. Mr. Wlodarczyk brings 35 years of experience in industrial automation, working with global and regional manufacturers in many industries, including automotive, material handling, packaging and consumer products. Most recently, Mr. Wlodarczyk served as Senior Vice President, Intelligen ...

PITTSBURGH, April 24, 2024 (GLOBE NEWSWIRE) -- Matthews International Corporation (NASDAQ GSM: MATW) announced that its Board of Directors declared, at its regularly scheduled meeting today, a dividend of $0.24 per share on the Company's common stock. The dividend is payable May 20, 2024 to stockholders of record May 6, 2024. About Matthews International Corporation Matthews International Corporation is a global provider of industrial technologies, memorialization products and brand solutions. The Industria ...

Financial Data and Key Metrics Changes - Consolidated sales increased modestly to $450 million in the first quarter of fiscal 2024 from $449 million in the same period last year, primarily driven by higher sales in the industrial technologies and memorialization segments [8][38] - Consolidated adjusted EBITDA decreased to $45.5 million from $49.3 million year-over-year, reflecting lower adjusted EBITDA in the industrial technologies and memorialization segments, partially offset by an increase in the SGK Brand Solutions segment [39][68] - The net loss attributable to the company for the quarter was $2.3 million or $0.07 per share, compared to income of $3.7 million or $0.12 per share in the prior period [79] Business Line Data and Key Metrics Changes - Memorialization sales were $208.1 million, up from $206.5 million a year ago, mainly due to higher granite sales and the acquisition of Eagle Granite, despite a decline in casket sales [13][41][75] - SGK Brand Solutions segment reported sales of $130.5 million, down from $133.6 million, primarily due to lower retail base sales and continued weakness in the European brand market [42] - Industrial Technology segment sales increased to $111.4 million from $109.1 million, driven by growth in energy storage solutions [80] Market Data and Key Metrics Changes - The company noted a favorable impact of currency changes, contributing $5.1 million to current quarter sales and $354,000 to adjusted EBITDA compared to the previous year [14][41] - The energy solutions segment is expected to see higher revenue in fiscal 2024 than the previous year, driven by strong interest in hydrogen fuel cell production [34][37] Company Strategy and Development Direction - The company aims to continue consolidating sales growth and EBITDA for the full year, despite current delays in energy solutions, with a backlog of over $100 million at the end of the first quarter [37][74] - The strategy to extend marketing execution services to eCommerce digital marketing is expected to generate over $40 million in sales this year [76] - The company has renewed its revolving credit facility, providing access to capital during uncertain economic conditions [12][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving growth despite challenges in energy sales, emphasizing ongoing discussions with major global OEMs and battery manufacturers [50][69] - The memorialization business is expected to continue performing well, with recent weeks showing higher-than-normal sales volumes [75] - Management anticipates stronger cash flow trends in the latter half of the fiscal year as orders from the previous year convert to cash [77] Other Important Information - The company declared a dividend of $0.24 per share, payable on February 19, 2024 [20] - Outstanding debt increased to $862 million at the end of the quarter, with a leverage ratio of 3.71 compared to 3.31 at the end of the previous quarter [44] Q&A Session Summary Question: What are the expectations for energy storage and overall revenue growth? - Management indicated that discussions with customers are ongoing, and while timing of order intake is uncertain, they remain confident in achieving positive growth year-over-year [50] Question: How is the memorialization segment performing, especially regarding casket sales? - Management noted that while casket sales have normalized, granite memorial sales have increased, and they expect overall performance to remain strong [51][60] Question: What is the status of profit initiatives at OLBRICH? - Management stated that they expect profit contributions from OLBRICH to improve as cost actions are implemented [28][62]

PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) The company reported flat sales of $450.0 million, a net loss of $2.3 million, and improved operating cash flow for Q1 FY2024 Consolidated Balance Sheet Highlights (Unaudited) | (In thousands) | Dec 31, 2023 | Sep 30, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$1,903,125** | **$1,887,381** | | Total Current Assets | $658,063 | $648,257 | | Goodwill | $708,961 | $698,109 | | **Total Liabilities** | **$1,394,316** | **$1,362,100** | | Long-term Debt | $857,423 | $786,484 | | **Total Shareholders' Equity** | **$508,809** | **$525,281** | Consolidated Statement of Income Highlights (Unaudited) | (In thousands, except per share data) | Three Months Ended Dec 31, 2023 | Three Months Ended Dec 31, 2022 | | :--- | :--- | :--- | | **Sales** | **$449,986** | **$449,240** | | Gross Profit | $132,353 | $138,930 | | Operating Profit | $9,427 | $17,228 | | **Net (Loss) Income** | **($2,303)** | **$3,647** | | **Diluted (Loss) Earnings Per Share** | **($0.07)** | **$0.12** | Consolidated Statement of Cash Flows Highlights (Unaudited) | (In thousands) | Three Months Ended Dec 31, 2023 | Three Months Ended Dec 31, 2022 | | :--- | :--- | :--- | | **Net cash used in operating activities** | **($27,266)** | **($36,224)** | | Net cash used in investing activities | ($14,186) | ($14,153) | | Net cash provided by financing activities | $36,114 | $22,322 | | **Net change in cash and cash equivalents** | **($4,180)** | **($26,298)** | [Note 3. Revenue Recognition](index=10&type=section&id=Note%203.%20Revenue%20Recognition) Revenue was disaggregated by segment and geography, with North America as the largest market and Memorialization as the largest segment Disaggregated Sales by Segment and Region (Three Months Ended Dec 31) | (In thousands) | 2023 | 2022 | | :--- | :--- | :--- | | **Memorialization** | **$208,071** | **$206,502** | | - North America | $197,165 | $195,199 | | - Europe | $7,971 | $8,363 | | **Industrial Technologies** | **$111,374** | **$109,143** | | - Europe | $76,776 | $71,301 | | - North America | $33,139 | $36,140 | | **SGK Brand Solutions** | **$130,541** | **$133,595** | | - North America | $62,720 | $67,580 | | - Europe | $50,132 | $48,517 | | **Total Sales** | **$449,986** | **$449,240** | - Revenue from products or services provided to customers over time increased to approximately **19% of total revenue** for the three months ended December 31, 2023, up from 13% in the same period of 2022[31](index=31&type=chunk) [Note 7. Debt and Financing Arrangements](index=11&type=section&id=Note%207.%20Debt%20and%20Financing%20Arrangements) Total debt increased to $862.4 million due to higher revolving credit borrowings, with liquidity managed via multiple financing facilities Long-Term Debt Composition | (In thousands) | Dec 31, 2023 | Sep 30, 2023 | | :--- | :--- | :--- | | Revolving credit facilities | $521,071 | $463,168 | | 2025 Senior Notes | $298,635 | $298,500 | | Other borrowings | $28,117 | $19,241 | | Finance lease obligations | $14,548 | $9,271 | | **Total debt** | **$862,371** | **$790,180** | - The company maintains a **$750 million senior secured revolving credit facility** maturing in March 2025, with outstanding borrowings of $454.4 million in USD and €55.0 million ($60.7 million) as of December 31, 2023[35](index=35&type=chunk)[36](index=36&type=chunk) - The company utilizes a receivables purchase agreement (RPA) to sell up to $125.0 million of trade receivables, with **$101.9 million in receivables sold** and derecognized as of December 31, 2023[38](index=38&type=chunk)[39](index=39&type=chunk) [Note 14. Segment Information](index=20&type=section&id=Note%2014.%20Segment%20Information) Segment results show flat consolidated sales and a decline in total Adjusted EBITDA to $45.5 million, with varied performance across segments Segment Sales and Adjusted EBITDA (Three Months Ended Dec 31) | (In thousands) | 2023 | 2022 | | :--- | :--- | :--- | | **Sales** | | | | Memorialization | $208,071 | $206,502 | | Industrial Technologies | $111,374 | $109,143 | | SGK Brand Solutions | $130,541 | $133,595 | | **Consolidated Sales** | **$449,986** | **$449,240** | | **Adjusted EBITDA** | | | | Memorialization | $36,700 | $39,137 | | Industrial Technologies | $9,622 | $12,202 | | SGK Brand Solutions | $12,893 | $12,232 | | Corporate and Non-Operating | ($13,733) | ($14,280) | | **Total Adjusted EBITDA** | **$45,482** | **$49,291** | - The company's primary measure of segment profitability is **adjusted EBITDA**, which excludes certain items to better evaluate operating results[69](index=69&type=chunk) [Note 16. Goodwill and Other Intangible Assets](index=22&type=section&id=Note%2016.%20Goodwill%20and%20Other%20Intangible%20Assets) Consolidated goodwill increased to $709.0 million, with the SGK Brand Solutions unit showing a narrow 4% cushion against impairment Goodwill by Segment | (In thousands) | Dec 31, 2023 | Sep 30, 2023 | | :--- | :--- | :--- | | Memorialization | $370,028 | $366,015 | | Industrial Technologies | $116,004 | $115,073 | | SGK Brand Solutions | $222,929 | $217,021 | | **Consolidated Goodwill** | **$708,961** | **$698,109** | - The SGK Brand Solutions reporting unit's estimated fair value exceeded its carrying value by **only 4%** as of September 1, 2023, indicating a risk of future goodwill write-downs[80](index=80&type=chunk) [Note 17. Subsequent Event](index=23&type=section&id=Note%2017.%20Subsequent%20Event) The company amended its domestic credit facility post-quarter end, extending its maturity to January 2029 for enhanced financial flexibility - On January 31, 2024, the company amended its domestic credit facility, **extending the maturity to January 2029** and updating the interest rate structure[84](index=84&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses flat sales, a decline in Adjusted EBITDA to $45.5 million due to cost pressures, and a solid liquidity position [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q1 FY2024 sales were flat at $450.0 million, while gross margin and Adjusted EBITDA declined due to unfavorable mix and higher costs - Memorialization sales rose due to higher granite product sales and the Eagle Granite acquisition, but were offset by **lower casket and cremation equipment sales**[92](index=92&type=chunk) - Industrial Technologies sales increased, driven by **energy storage solutions for the EV market**, but were partially offset by reduced warehouse automation sales[92](index=92&type=chunk) - SGK Brand Solutions sales decreased, primarily reflecting **lower retail-based sales**[92](index=92&type=chunk)[93](index=93&type=chunk) - Gross profit declined due to **unfavorable sales mix** (lower casket sales, higher granite sales), lower margins on engineered products, and increased material and labor costs[94](index=94&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is supported by improved operating cash flow and credit facilities, with $65 million in planned capex and $17.2 million in share repurchases Cash Flow Summary (Three Months Ended Dec 31) | (In millions) | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | ($27.3) | ($36.2) | | Net cash used in investing activities | ($14.2) | ($14.2) | | Net cash provided by financing activities | $36.1 | $22.3 | - Fiscal 2024 capital spending is projected to be approximately **$65 million**, an increase to support new production capabilities[107](index=107&type=chunk) - The company repurchased **465,953 shares for $17.2 million** in Q1 FY2024, with 729,060 shares remaining available for repurchase[123](index=123&type=chunk)[146](index=146&type=chunk) [Forward-Looking Information](index=33&type=section&id=Forward-Looking%20Information) Future performance depends on EV trends, death rates, and economic conditions, with ongoing efforts to mitigate cost and supply chain pressures - The Industrial Technologies segment received **over $200 million in new orders** for its energy storage solutions business during Q1 FY2023, expected to impact fiscal 2024 sales[132](index=132&type=chunk) - Key factors influencing future sales include **North American death rates and cremation trends** for the Memorialization segment, and global economic conditions for the SGK Brand Solutions segment[132](index=132&type=chunk) - The company expects ongoing pressure from **labor cost increases, supply chain issues, and inflation**, which it aims to offset with price increases and cost-reduction initiatives[133](index=133&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes in its market risk profile during the first quarter of fiscal 2024 - There were **no material changes** in the Company's market risk during the first quarter of fiscal 2024[138](index=138&type=chunk) [Item 4. Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - The CEO and CFO concluded that as of December 31, 2023, the Company's disclosure controls and procedures were **effective at a reasonable assurance level**[140](index=140&type=chunk) - **No material changes** to internal controls over financial reporting were identified during the quarter ended December 31, 2023[141](index=141&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=36&type=section&id=Item%201.%20Legal%20Proceedings) Ongoing legal proceedings are not expected to have a material adverse effect on the company's financial condition or results - Management does not expect any ongoing legal proceedings to have a **material adverse effect** on the company's financial condition or results[143](index=143&type=chunk) [Item 1A. Risk Factors](index=36&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors since the last annual report - There have been **no material changes in risk factors** from those disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2023[144](index=144&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 465,953 shares for $17.2 million in Q1 FY2024, with 729,060 shares remaining under the buyback plan Monthly Stock Repurchase Activity (Q1 FY2024) | Period | Total Shares Purchased | Weighted Average Price Paid | Shares Remaining in Plan | | :--- | :--- | :--- | :--- | | October 2023 | 84,962 | $36.73 | 1,110,051 | | November 2023 | 287,039 | $37.56 | 823,012 | | December 2023 | 93,952 | $34.94 | 729,060 | | **Total** | **465,953** | **$36.88** | **729,060** |

Key Drivers • Growth in consolidated sales and adjusted EBITDA • Customer interest in the energy storage solutions business remains strong • Large longer-term projects impact quarterly predictability The Company has presented constant currency sales and constant currency adjusted EBITDA and believes these measures provide relevant and useful information, which is used by the Company's management in assessing the performance of its business on a consistent basis by removing the impact of changes due to forei ...

Part I [Business Overview](index=3&type=section&id=Item%201.%20Business) Matthews International is a global provider of memorialization products, industrial technologies, and brand solutions, operating through three segments - The company is a global provider of memorialization products, industrial technologies, and brand solutions, operating under three corresponding business segments[13](index=13&type=chunk) Consolidated Sales by Segment (in thousands) | Segment | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Memorialization | $842,997 | $840,124 | $769,016 | | Industrial Technologies | $505,751 | $335,523 | $284,495 | | SGK Brand Solutions | $532,148 | $586,756 | $617,519 | | **Consolidated Sales** | **$1,880,896** | **$1,762,403** | **$1,671,030** | - As of October 31, 2023, the company employed **approximately 12,000 people** globally across more than 300 locations in 30 countries[53](index=53&type=chunk) [Memorialization Segment](index=4&type=section&id=Memorialization) This segment manufactures and markets memorialization products, including memorials, caskets, and cremation equipment, serving funeral homes globally - The segment produces a full line of memorial products such as cast bronze and granite memorials, caskets, and cremation equipment[15](index=15&type=chunk) - It is a leading manufacturer of caskets in North America, offering metal, wood, and cremation caskets with various personalization options[19](index=19&type=chunk)[20](index=20&type=chunk) - The segment also provides cremation systems for both human and pet sectors, waste incineration systems, and related environmental systems, primarily in North America and Europe[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) [Industrial Technologies Segment](index=6&type=section&id=Industrial%20Technologies) This segment provides high-tech custom solutions, including energy storage systems, product identification, and coating/converting lines - The segment designs and manufactures custom energy storage solutions, product identification systems, warehouse automation, and coating/converting lines[32](index=32&type=chunk) - The energy storage solutions business has experienced significant growth due to increasing demand for electric vehicles and has nearly a decade of experience in developing dry electrode battery solutions[36](index=36&type=chunk) - A significant portion of revenue comes from consumables and replacement parts, particularly inks developed exclusively for its marking equipment[39](index=39&type=chunk) [SGK Brand Solutions Segment](index=7&type=section&id=SGK%20Brand%20Solutions) This segment offers comprehensive packaging and brand experience solutions, including design, premedia, and printing plate production - Provides end-to-end packaging and brand experience solutions, including design, production art, premedia services, and printing plate production[43](index=43&type=chunk)[45](index=45&type=chunk) - Principal clients are global, multinational, and regional companies in highly regulated industries such as food & beverage, pharmaceuticals, and beauty[47](index=47&type=chunk) - The ability to offer consistent service on a global basis is a key competitive differentiator[49](index=49&type=chunk) [Human Capital Resources](index=9&type=section&id=Human%20Capital%20Resources) The company's human capital strategy focuses on talent building, employee engagement, D&I, and health and safety - The company's D&I strategy focuses on seven key areas: Talent Acquisition, Employee Engagement, Learning and Awareness, Supplier Diversity, Connection to Customers, Normalizing Courageous Conversations, and Community Engagement[55](index=55&type=chunk) - A robust talent review process is in place to identify critical talent for succession planning and leadership development programs[61](index=61&type=chunk) - Employee health and safety is a core value and the company's highest priority, managed by a global team and supported at the local level[64](index=64&type=chunk) [Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) The company faces material risks from foreign operations, supply chain, goodwill impairment, economic conditions, and cybersecurity - Company-specific risks include those arising from foreign operations (currency fluctuations, political instability), changes in interest rates, increased raw material prices, and potential impairment of significant goodwill and intangible assets[69](index=69&type=chunk)[72](index=72&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk) - The Memorialization segment is sensitive to changes in mortality and cremation rates, with rising cremation rates potentially affecting sales of traditional burial products[77](index=77&type=chunk)[78](index=78&type=chunk) - General risks include disruptions to the global supply chain, the impact of pandemics and global conflicts, labor shortages, cybersecurity breaches, and failure to maintain effective internal controls[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk)[100](index=100&type=chunk) - The SGK Brand Solutions reporting unit had a goodwill impairment of **$82.5 million** in fiscal 2022, and future impairment charges could occur if performance deteriorates[76](index=76&type=chunk) [Properties](index=19&type=section&id=Item%202.%20Properties) The company's principal properties, including manufacturing facilities and offices, are located across North America, Europe, and Asia - The company lists its significant principal properties as of October 31, 2023, categorized by its three segments: Memorialization, Industrial Technologies, and SGK Brand Solutions, noting which are owned versus leased[108](index=108&type=chunk) [Officers and Executive Management](index=21&type=section&id=OFFICERS%20AND%20EXECUTIVE%20MANAGEMENT%20OF%20THE%20REGISTRANT) This section lists the company's executive officers as of October 31, 2023, including their names, ages, and positions Executive Officers (as of Oct 31, 2023) | Name | Age | Position | | :--- | :--- | :--- | | Joseph C. Bartolacci | 63 | President and Chief Executive Officer | | Steven F. Nicola | 63 | Chief Financial Officer and Secretary | | Gregory S. Babe | 66 | Chief Technology Officer and Group President, Industrial Technologies | | Steven D. Gackenbach | 60 | Group President, Memorialization | | Gary R. Kohl | 60 | President, SGK Brand Solutions | Part II [Market for Common Equity and Related Stockholder Matters](index=22&type=section&id=Item%205.%20Market%20For%20Registrant%27s%20Common%20Equity%20And%20Related%20Stockholder%20Matters) The company's Class A Common Stock trades on Nasdaq under 'MATW', with an active stock repurchase program and performance graph - The company's Class A Common Stock trades on the Nasdaq Global Select Market under the symbol 'MATW'[120](index=120&type=chunk) Fiscal 2023 Stock Repurchase Activity | Metric | Value | | :--- | :--- | | Total Shares Purchased | **99,829** | | Weighted Average Price Paid | **$28.61** | | Shares Remaining for Repurchase (as of Sep 30, 2023) | **1,195,013** | [Management's Discussion and Analysis (MD&A)](index=24&type=section&id=Item%207.%20Management%27s%20Discussion%20And%20Analysis%20Of%20Financial%20Condition%20And%20Results%20Of%20Operations) MD&A details fiscal 2023 sales growth to $1.88 billion, Adjusted EBITDA, liquidity, and critical accounting policies [Results of Operations: Fiscal 2023 vs. 2022](index=25&type=section&id=Comparison%20Of%20Fiscal%202023%20And%20Fiscal%202022) Consolidated sales for fiscal 2023 increased to $1.88 billion, driven by Industrial Technologies, with gross profit and Adjusted EBITDA rising Financial Performance Comparison (FY2023 vs. FY2022) | Metric (in millions) | FY 2023 | FY 2022 | Change | | :--- | :--- | :--- | :--- | | Consolidated Sales | $1,880.9 | $1,762.4 | +$118.5 | | Gross Profit | $577.7 | $522.3 | +$55.4 | | Adjusted EBITDA | $225.8 | $210.4 | +$15.4 | - Industrial Technologies sales surged, primarily due to the impact of the OLBRICH and R+S Automotive acquisitions and higher sales of energy storage solutions for the electric vehicle market[138](index=138&type=chunk) - SGK Brand Solutions sales decreased due to lower brand sales in the U.S. and Europe and a decline in cylinder packaging products in Europe, partially offset by growth in the Asia-Pacific market[138](index=138&type=chunk) - Interest expense increased to **$44.6 million** from **$27.7 million**, primarily due to higher average interest rates[143](index=143&type=chunk) [Non-GAAP Financial Measures](index=27&type=section&id=NON-GAAP%20FINANCIAL%20MEASURES) The company uses non-GAAP measures, primarily Adjusted EBITDA, to evaluate performance, with a detailed reconciliation provided Reconciliation of Net Income (Loss) to Adjusted EBITDA (in thousands) | | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net income (loss) | $39,136 | $(99,828) | $2,858 | | Adjustments (Interest, Taxes, D&A, etc.) | $186,673 | $310,236 | $224,892 | | **Total Adjusted EBITDA** | **$225,809** | **$210,408** | **$227,750** | [Liquidity and Capital Resources](index=29&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) Net cash from operating activities decreased to $79.5 million, with liquidity supported by credit facility and receivables financing - Net cash provided by operating activities decreased to **$79.5 million** in FY2023 from **$126.9 million** in FY2022[152](index=152&type=chunk) - The company utilizes a receivables purchase agreement (RPA) and a non-recourse factoring arrangement, which provided net cash proceeds of **$5.2 million** and sold receivables of **$55.2 million**, respectively, in FY2023[159](index=159&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) - Total debt outstanding was **$790.2 million** as of September 30, 2023, consisting mainly of a **$750 million** revolving credit facility and 5.25% senior notes due 2025[157](index=157&type=chunk)[158](index=158&type=chunk)[278](index=278&type=chunk) - Capital spending for fiscal 2024 is estimated to be **approximately $75 million**, reflecting investments in new production capabilities and efficiencies[154](index=154&type=chunk) [Critical Accounting Policies](index=33&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES) Key accounting policies involve significant estimates for long-lived assets, goodwill, and income taxes, with SGK Brand Solutions goodwill at risk - The company's critical accounting policies involve significant estimates for long-lived assets, goodwill, and income taxes[181](index=181&type=chunk) - An interim goodwill impairment test for the SGK Brand Solutions reporting unit as of September 1, 2023, indicated its fair value exceeded its carrying value by **approximately 4%**. This narrow margin suggests a risk of future write-downs if performance falters or economic conditions worsen[184](index=184&type=chunk) [Market Risk Disclosures](index=35&type=section&id=Item%207A.%20Quantitative%20And%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks from interest rates, foreign currency, and commodity prices, using swaps to manage debt - The company uses interest rate swaps to manage exposure on its variable-rate debt, with a notional amount of **$175 million** in pay-fixed swaps as of September 30, 2023[191](index=191&type=chunk) - A hypothetical **10% strengthening** of the U.S. dollar would have reduced reported sales by **$69.5 million** and operating income by **$3.4 million** for fiscal 2023[193](index=193&type=chunk) - The company is exposed to commodity price risks for materials such as bronze ingot, steel, granite, fuel, and wood, which can impact profitability[195](index=195&type=chunk) [Financial Statements and Supplementary Data](index=37&type=section&id=Item%208.%20Financial%20Statements%20And%20Supplementary%20Data) This section presents consolidated financial statements for fiscal years 2021-2023, with goodwill valuation noted as a critical audit matter [Consolidated Financial Statements](index=43&type=section&id=Consolidated%20Financial%20Statements) Consolidated financial statements show total assets of $1.887 billion and net income of $39.3 million for fiscal 2023 Consolidated Balance Sheet Highlights (in thousands) | | Sep 30, 2023 | Sep 30, 2022 | | :--- | :--- | :--- | | Total Current Assets | **$648,257** | **$628,616** | | Total Assets | **$1,887,381** | **$1,882,771** | | Total Current Liabilities | **$394,600** | **$411,375** | | Total Liabilities | **$1,362,100** | **$1,395,695** | | Total Shareholders' Equity | **$525,281** | **$487,076** | Consolidated Income Statement Highlights (in thousands, except EPS) | | FY 2023 | FY 2022 | FY 2021 | | :--- | :--- | :--- | :--- | | Sales | $1,880,896 | $1,762,403 | $1,671,030 | | Gross Profit | $577,672 | $522,278 | $541,832 | | Operating Profit (Loss) | $88,117 | $(43,937) | $42,034 | | Net Income (Loss) Attributable to Shareholders | $39,291 | $(99,774) | $2,910 | | Diluted EPS | $1.26 | $(3.18) | $0.09 | [Note 21: Acquisitions and Divestitures](index=76&type=section&id=Note%2021.%20ACQUISITIONS%20AND%20DIVESTITURES) Fiscal 2023 acquisitions included Eagle Granite for $18.4 million, and fiscal 2022 saw OLBRICH and R+S Automotive acquired - In February 2023, acquired Eagle Granite Company for the Memorialization segment for a total purchase price of **$18.4 million**[350](index=350&type=chunk) - In August 2022, acquired German firms OLBRICH and R+S Automotive for the Industrial Technologies segment for approximately **€43.7 million** (**$44.5 million**)[352](index=352&type=chunk) [Note 22: Goodwill and Other Intangible Assets](index=77&type=section&id=Note%2022.%20GOODWILL%20AND%20OTHER%20INTANGIBLE%20ASSETS) Goodwill totaled $698.1 million, with a $82.5 million write-down in fiscal 2022 for SGK Brand Solutions, which remains at impairment risk Goodwill by Segment (in thousands) | Segment | Sep 30, 2023 | Sep 30, 2022 | | :--- | :--- | :--- | | Memorialization | $366,015 | $361,782 | | Industrial Technologies | $115,073 | $107,022 | | SGK Brand Solutions | $217,021 | $206,617 | | **Total Goodwill** | **$698,109** | **$675,421** | - In fiscal 2022, the company recorded a goodwill write-down of **$82.5 million** for the SGK Brand Solutions reporting unit due to weakened economic conditions and other pressures[360](index=360&type=chunk) - A Q4 2023 interim assessment of the SGK Brand Solutions reporting unit indicated its estimated fair value exceeded its carrying value by **approximately 4%**, highlighting the risk of future impairment charges[358](index=358&type=chunk) [Controls and Procedures](index=80&type=section&id=Item%209A.%20Controls%20And%20Procedures) Management concluded disclosure controls and internal control over financial reporting were effective as of September 30, 2023 - Based on an evaluation, the CEO and CFO concluded that the company's disclosure controls and procedures were effective as of September 30, 2023[370](index=370&type=chunk) - Management's report on internal control over financial reporting, and the corresponding audit report from Ernst & Young LLP, confirmed that the company maintained effective internal control over financial reporting as of September 30, 2023[371](index=371&type=chunk)[372](index=372&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=82&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20And%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the proxy statement - Information required for this item is incorporated by reference from the Company's definitive proxy statement[378](index=378&type=chunk) [Executive Compensation](index=82&type=section&id=Item%2011.%20Executive%20Compensation) Details on executive and director compensation are incorporated by reference from the proxy statement - Information regarding executive compensation is incorporated by reference from the Company's definitive proxy statement[380](index=380&type=chunk) [Security Ownership and Equity Compensation Plans](index=82&type=section&id=Item%2012.%20Security%20Ownership%20Of%20Certain%20Beneficial%20Owners%20And%20Management) This section details the company's equity compensation plans, with 4,548,853 securities available for future issuance - The company maintains several equity compensation plans, with the primary active plans being the 2017 Equity Incentive Plan and the Amended and Restated 2019 Director Fee Plan[382](index=382&type=chunk)[385](index=385&type=chunk) Equity Compensation Plan Information (as of Sep 30, 2023) | Category | Securities to be Issued Upon Exercise | Weighted-Average Exercise Price | Securities Remaining Available for Future Issuance | | :--- | :--- | :--- | :--- | | Approved by Security Holders | **120,218** | **$41.70** | **4,548,853** | Part IV [Exhibits and Financial Statement Schedules](index=85&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules%2C%20And%20Reports%20On%20Form%208-K) This section lists all financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K - This section provides a comprehensive list of all financial statements, the financial statement schedule (Schedule II - Valuation and Qualifying Accounts), and all exhibits filed with the report[391](index=391&type=chunk)

FORM 10-Q Filing Information [Registrant Information](index=1&type=section&id=Registrant%20Information) Details Matthews International Corporation's identification, incorporation, and SEC filing compliance as a large accelerated filer - Registrant: **MATTHEWS INTERNATIONAL CORPORATION**[2](index=2&type=chunk) - Incorporation: **Pennsylvania**[2](index=2&type=chunk) - SEC Filing Compliance: Filed all required reports in the preceding 12 months and subject to filing requirements for the past 90 days (Yes). Submitted every Interactive Data File electronically (Yes)[3](index=3&type=chunk)[4](index=4&type=chunk)[5](index=5&type=chunk) Filer Status | Filer Status | Selection | | :-------------------- | :-------- | | Large accelerated filer | ✓ | | Accelerated filer | ☐ | | Non-accelerated filer | ☐ | | Smaller reporting company | ☐ | | Emerging growth company | ☐ | - Common Stock Outstanding (as of June 30, 2023): **30,467,662 shares of Class A Common Stock**[7](index=7&type=chunk) PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) Presents Matthews International Corporation's unaudited consolidated financial statements and notes for periods ended June 30, 2023 [Consolidated Balance Sheets (Unaudited)](index=2&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Consolidated Balance Sheet Highlights (Amounts in thousands) | Metric | June 30, 2023 | September 30, 2022 | | :---------------------- | :------------ | :----------------- | | **ASSETS** | | | | Total current assets | $619,550 | $628,616 | | Property, plant and equipment, net | $273,572 | $256,065 | | Goodwill | $702,916 | $675,421 | | Total assets | $1,884,191 | $1,882,771 | | **LIABILITIES** | | | | Total current liabilities | $380,071 | $411,375 | | Long-term debt | $772,056 | $795,291 | | Total liabilities | $1,362,370 | $1,395,695 | | **SHAREHOLDERS' EQUITY**| | | | Total shareholders' equity | $521,821 | $487,076 | - Total assets increased slightly from **$1,882,771 thousand** at September 30, 2022, to **$1,884,191 thousand** at June 30, 2023. Goodwill saw an increase from **$675,421 thousand** to **$702,916 thousand**[10](index=10&type=chunk) - Total liabilities decreased from **$1,395,695 thousand** to **$1,362,370 thousand**, primarily driven by a reduction in current liabilities and long-term debt. Shareholders' equity increased from **$487,076 thousand** to **$521,821 thousand**[10](index=10&type=chunk) [Consolidated Statements of Income (Unaudited)](index=4&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20INCOME) Consolidated Income Statement Highlights (Amounts in thousands, except per share data) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Sales | $471,908 | $421,719 | $1,400,728 | $1,305,276 | | Gross profit | $138,305 | $120,865 | $426,858 | $377,021 | | Operating profit | $21,524 | $10,963 | $61,803 | $29,108 | | Income (loss) before income taxes | $8,113 | $3,915 | $25,579 | $(21,182) | | Net income (loss) attributable to Matthews shareholders | $8,738 | $2,893 | $21,568 | $(18,815) | | Basic EPS | $0.28 | $0.09 | $0.70 | $(0.60) | | Diluted EPS | $0.28 | $0.09 | $0.69 | $(0.60) | - Sales increased by **$50,189 thousand (11.9%)** for the three months ended June 30, 2023, and by **$95,452 thousand (7.3%)** for the nine months ended June 30, 2023, compared to the respective prior year periods[13](index=13&type=chunk) - Net income attributable to Matthews shareholders significantly improved, turning from a loss of **$18,815 thousand** in the nine months ended June 30, 2022, to a profit of **$21,568 thousand** in the same period of 2023. Basic EPS also improved from **$(0.60)** to **$0.70**[13](index=13&type=chunk) [Consolidated Statements of Comprehensive Income (Loss) (Unaudited)](index=5&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME%20(LOSS)) Consolidated Comprehensive Income (Loss) Highlights (Amounts in thousands) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net income (loss) attributable to Matthews | $8,738 | $2,893 | $21,568 | $(18,815) | | Other comprehensive income (loss) (OCI), net of tax: | | | | | | Foreign currency translation adjustment | $923 | $(19,293) | $25,915 | $(27,463) | | Net change in unrecognized gain on cash flow hedges | $2,507 | $1,576 | $(139) | $7,149 | | Total OCI, net of tax | $3,220 | $(17,700) | $26,335 | $13,832 | | Comprehensive income (loss) | $11,958 | $(14,807) | $47,903 | $(5,006) | - Comprehensive income for Matthews shareholders significantly improved, reaching **$11,958 thousand** for the three months ended June 30, 2023, compared to a loss of **$14,807 thousand** in the prior year. For the nine-month period, it swung from a loss of **$5,006 thousand** to a gain of **$47,903 thousand**[14](index=14&type=chunk) - Foreign currency translation adjustment showed a positive impact of **$923 thousand** for the three months and **$25,915 thousand** for the nine months ended June 30, 2023, a significant reversal from losses in the prior year periods[14](index=14&type=chunk) [Consolidated Statements of Shareholders' Equity (Unaudited)](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20SHAREHOLDERS'%20EQUITY) Shareholders' Equity Changes (Amounts in thousands) | Metric | Balance, September 30, 2022 | Balance, June 30, 2023 | | :-------------------------------------- | :-------------------------- | :--------------------- | | Common Stock | $36,334 | $36,334 | | Additional Paid-in Capital | $160,255 | $164,640 | | Retained Earnings | $706,749 | $704,366 | | Accumulated Other Comprehensive (Loss) Income | $(190,191) | $(163,856) | | Treasury Stock, at cost | $(225,795) | $(219,263) | | Total Shareholders' Equity - Matthews | $487,352 | $522,221 | - Total shareholders' equity attributable to Matthews increased from **$487,076 thousand** at September 30, 2022, to **$521,821 thousand** at June 30, 2023[16](index=16&type=chunk)[18](index=18&type=chunk) - Accumulated Other Comprehensive Loss improved significantly from **$(190,191) thousand** to **$(163,856) thousand**, primarily due to positive foreign currency translation adjustments[16](index=16&type=chunk)[18](index=18&type=chunk) - The company paid dividends of **$8,794 thousand**, **$7,683 thousand**, and **$7,474 thousand** in the quarters ending December 31, 2022, March 31, 2023, and June 30, 2023, respectively[16](index=16&type=chunk) [Consolidated Statements of Cash Flows (Unaudited)](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Consolidated Cash Flow Highlights (Amounts in thousands) | Metric | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :-------------------------------------- | :------------------------------ | :------------------------------ | | Net cash provided by operating activities | $76,906 | $84,367 | | Net cash used in investing activities | $(53,717) | $(38,929) | | Net cash used in financing activities | $(56,357) | $(43,776) | | Net change in cash, cash equivalents and restricted cash | $(32,119) | $(2,200) | | Cash, cash equivalents and restricted cash at end of period | $39,295 | $66,143 | - Net cash provided by operating activities decreased by **$7,461 thousand (8.8%)** for the nine months ended June 30, 2023, compared to the prior year, primarily due to changes in working capital items and pension settlement payments, partially offset by proceeds from cash flow hedges[20](index=20&type=chunk)[112](index=112&type=chunk) - Net cash used in investing activities increased by **$14,788 thousand (38.0%)** for the nine months ended June 30, 2023, mainly due to higher capital expenditures and acquisitions[20](index=20&type=chunk)[113](index=113&type=chunk) - Net cash used in financing activities increased by **$12,581 thousand (28.7%)** for the nine months ended June 30, 2023, driven by net repayments on long-term debt and dividends[20](index=20&type=chunk)[115](index=115&type=chunk) [Notes to Consolidated Financial Statements (Unaudited)](index=9&type=section&id=NOTES%20TO%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) [Note 1. Nature of Operations](index=9&type=section&id=Note%201.%20Nature%20of%20Operations) - Matthews International Corporation, founded in 1850, is a global provider of memorialization products, industrial technologies, and brand solutions[22](index=22&type=chunk) - Memorialization: Bronze and granite memorials, caskets, cremation products, and equipment for cemetery and funeral home industries - Industrial Technologies: High-tech custom energy storage solutions, product identification, and warehouse automation technologies - SGK Brand Solutions: Brand management, pre-media services, printing plates, imaging, digital asset management, merchandising, marketing, and design services for consumer goods and retail - The Company operates globally with facilities in North America, Europe, Asia, Australia, and Central and South America[23](index=23&type=chunk) [Note 2. Basis of Presentation](index=9&type=section&id=Note%202.%20Basis%20of%20Presentation) - The unaudited consolidated financial statements are prepared in accordance with GAAP for interim financial information and Form 10-Q instructions, not including all disclosures required for complete annual financial statements[24](index=24&type=chunk) - Effective April 1, 2022, the Company applies highly inflationary accounting to its Turkish subsidiaries, remeasuring financial statements into USD and reflecting exchange gains/losses from monetary assets/liabilities in current earnings[25](index=25&type=chunk) Exchange Losses from Highly Inflationary Accounting (Amounts in thousands) | Period | Exchange Losses | | :-------------------------------------- | :-------------- | | Three months ended June 30, 2023 | $1,826 | | Nine months ended June 30, 2023 | $3,074 | | Three months ended June 30, 2022 | $1,245 | | Nine months ended June 30, 2022 | $1,245 | - ASU No. 2021-08 (Business Combinations): Effective fiscal 2024, not expected to have a significant impact - ASU No. 2022-04 (Supplier Finance Programs): Effective Q1 fiscal 2024 (rollforward in fiscal 2025), not expected to have a material impact [Note 3. Revenue Recognition](index=11&type=section&id=Note%203.%20Revenue%20Recognition) - Revenue is disaggregated by geography and segment, as these factors best reflect how economic conditions affect revenue and cash flows[30](index=30&type=chunk) Consolidated Sales by Segment and Region (Amounts in thousands) | Segment/Region | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :---------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | **Memorialization** | $208,728 | $203,158 | $638,119 | $633,868 | | North America | $197,309 | $191,495 | $604,386 | $593,901 | | Europe | $8,468 | $9,175 | $25,293 | $32,613 | | Australia | $2,951 | $2,488 | $8,440 | $7,354 | | **Industrial Technologies** | $130,533 | $78,443 | $365,190 | $230,928 | | North America | $43,924 | $39,736 | $121,900 | $110,869 | | Europe | $84,577 | $37,119 | $237,847 | $115,285 | | Asia | $2,032 | $1,588 | $5,443 | $4,774 | | **SGK Brand Solutions** | $132,647 | $140,118 | $397,419 | $440,480 | | North America | $63,000 | $68,008 | $192,904 | $211,278 | | Europe | $51,532 | $54,046 | $152,990 | $175,900 | | Asia | $14,753 | $13,795 | $41,316 | $41,335 | | **Total Sales** | **$471,908** | **$421,719** | **$1,400,728** | **$1,305,276** | - Industrial Technologies segment sales significantly increased by **66.4%** for the three months and **58.1%** for the nine months ended June 30, 2023, primarily driven by growth in Europe[30](index=30&type=chunk)[32](index=32&type=chunk) - SGK Brand Solutions sales decreased by **5.3%** for the three months and **9.8%** for the nine months ended June 30, 2023, with declines observed across North America and Europe[30](index=30&type=chunk)[32](index=32&type=chunk) - Revenue from products or services provided over time increased to approximately **17%** and **14%** of total revenue for the three and nine months ended June 30, 2023, respectively, up from **13%** and **11%** in the prior year[32](index=32&type=chunk) [Note 4. Fair Value Measurements](index=12&type=section&id=Note%204.%20Fair%20Value%20Measurements) - Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between market participants[33](index=33&type=chunk) - Level 1: Unadjusted quoted prices for identical assets/liabilities in active markets - Level 2: Observable inputs other than Level 1 quoted prices, directly or indirectly - Level 3: Unobservable inputs for the asset/liability Fair Value of Assets and Liabilities (Amounts in thousands) | Category | June 30, 2023 (Level 2) | September 30, 2022 (Level 2) | | :---------------------- | :---------------------- | :--------------------------- | | **Assets:** | | | | Derivatives | $1,734 | $14,421 | | Equity and fixed income mutual funds | $693 | — | | Life insurance policies | $5,234 | $4,439 | | Total assets at fair value | $7,661 | $18,860 | | **Liabilities:** | | | | Derivatives | $4,931 | — | | Total liabilities at fair value | $4,931 | — | - Derivatives (interest rate swaps and cross currency swaps) are valued based on observable market swap rates and classified within Level 2 of the fair value hierarchy[33](index=33&type=chunk) [Note 5. Inventories](index=13&type=section&id=Note%205.%20Inventories) Inventories Breakdown (Amounts in thousands) | Category | June 30, 2023 | September 30, 2022 | | :-------------- | :------------ | :----------------- | | Raw materials | $69,674 | $52,586 | | Work in process | $118,968 | $94,804 | | Finished goods | $79,957 | $78,050 | | Total Inventories | $268,599 | $225,440 | - Total inventories increased by **$43,159 thousand (19.1%)** from September 30, 2022, to June 30, 2023, with significant increases in raw materials and work in process[34](index=34&type=chunk) [Note 6. Investments](index=13&type=section&id=Note%206.%20Investments) Non-Current Investments (Amounts in thousands) | Category | June 30, 2023 | September 30, 2022 | | :------------------------------ | :------------ | :----------------- | | Equity and fixed income mutual funds | $693 | — | | Life insurance policies | $5,234 | $4,439 | | Equity-method investments | $326 | $2,729 | | Other (primarily cost-method) investments | $18,975 | $18,808 | | Total Investments | $25,228 | $25,976 | - Total non-current investments slightly decreased from **$25,976 thousand** to **$25,228 thousand**. A notable change was the decrease in equity-method investments from **$2,729 thousand** to **$326 thousand**, as the Company purchased the remaining ownership interest in a small Industrial Technologies business during fiscal 2023[35](index=35&type=chunk) [Note 7. Debt and Financing Arrangements](index=13&type=section&id=Note%207.%20Debt%20and%20Financing%20Arrangements) Long-Term Debt (Amounts in thousands) | Category | June 30, 2023 | September 30, 2022 | | :------------------------ | :------------ | :----------------- | | Revolving credit facilities | $452,691 | $480,107 | | 2025 Senior Notes | $298,365 | $297,961 | | Other borrowings | $17,345 | $13,434 | | Finance lease obligations | $6,596 | $7,066 | | Total debt | $774,997 | $798,568 | | Less current maturities | $(2,941) | $(3,277) | | Long-term debt | $772,056 | $795,291 | - Total debt decreased by **$23,571 thousand (2.9%)** from September 30, 2022, to June 30, 2023, primarily due to a reduction in revolving credit facilities[36](index=36&type=chunk) - The domestic credit facility's benchmark interest rate transitioned from LIBOR to SOFR in March 2023, with the weighted-average interest rate on outstanding borrowings increasing from **1.92%** (June 30, 2022) to **5.59%** (June 30, 2023)[36](index=36&type=chunk)[37](index=37&type=chunk) - The Company utilizes a receivables purchase agreement (RPA) and a non-recourse factoring arrangement to sell trade receivables, generating net cash proceeds of **$16,610 thousand** from RPA and **$36,045 thousand** from factoring for the nine months ended June 30, 2023[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk) - The Company was in compliance with all debt covenants as of June 30, 2023[44](index=44&type=chunk) [Note 8. Derivatives and Hedging Instruments](index=15&type=section&id=Note%208.%20Derivatives%20and%20Hedging%20Instruments) - The Company uses derivative financial instruments (interest rate swaps and cross currency swaps) to manage foreign currency, debt, and interest rate exposures[45](index=45&type=chunk) Interest Rate Swaps Designated as Cash Flow Hedges (Amounts in thousands) | Metric | June 30, 2023 | September 30, 2022 | | :---------------------------- | :------------ | :----------------- | | Notional amount | $175,000 | $125,000 | | Weighted-average maturity (years) | 4.4 | 3.1 | | Weighted-average received rate | 5.14% | 3.14% | | Weighted-average pay rate | 3.83% | 1.04% | - LIBOR-based interest rate swaps were settled in Q2 fiscal 2023, yielding **$10,474 thousand** in cash proceeds, and new SOFR-based swaps with a notional amount of **$175,000 thousand** were entered into[45](index=45&type=chunk) - The fair value of interest rate swaps showed a net unrealized gain of **$1,171 thousand ($876 thousand after tax)** at June 30, 2023, included in AOCI. Unrecognized gains of **$9,263 thousand ($6,922 thousand after tax)** from terminated LIBOR-based swaps also remain in AOCI[46](index=46&type=chunk) - A U.S. Dollar/Euro cross currency swap with a notional amount of **$81,392 thousand** is designated as a net investment hedge, resulting in a loss of **$3,265 thousand (net of tax)** reported in AOCI at June 30, 2023[47](index=47&type=chunk) [Note 9. Share-Based Payments](index=16&type=section&id=Note%209.%20Share-Based%20Payments) - The 2017 Equity Incentive Plan allows for grants of stock options, restricted shares, restricted share units, and performance units, with **3,450,000 shares** available for grants[49](index=49&type=chunk) Stock-Based Compensation Cost (Amounts in thousands) | Period | Stock-Based Compensation Cost | | :-------------------------------------- | :---------------------------- | | Three months ended June 30, 2023 | $5,023 | | Three months ended June 30, 2022 | $5,197 | | Nine months ended June 30, 2023 | $13,635 | | Nine months ended June 30, 2022 | $14,128 | - As of June 30, 2023, total unrecognized compensation cost for unvested stock-based awards was **$21,695 thousand**, expected to be recognized over a weighted average period of **2.1 years**[53](index=53&type=chunk) - The Company also maintains Director Fee Plans, under which non-employee directors receive annual retainer fees (cash or Class A Common Stock) and annual stock-based grants[54](index=54&type=chunk) [Note 10. Earnings Per Share Attributable to Matthews' Shareholders](index=18&type=section&id=Note%2010.%20Earnings%20Per%20Share%20Attributable%20to%20Matthews'%20Shareholders) Earnings Per Share (EPS) Data | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net income (loss) attributable to Matthews shareholders | $8,738 | $2,893 | $21,568 | $(18,815) | | Basic shares (in thousands) | 30,795 | 31,244 | 30,758 | 31,531 | | Diluted shares (in thousands) | 31,244 | 31,552 | 31,129 | 31,531 | | Basic EPS | $0.28 | $0.09 | $0.70 | $(0.60) | | Diluted EPS | $0.28 | $0.09 | $0.69 | $(0.60) | | Dividends declared per common share | $0.23 | $0.22 | $0.69 | $0.66 | - Basic and diluted EPS significantly improved for both the three and nine months ended June 30, 2023, compared to the prior year, reflecting the turnaround from a net loss to net income[56](index=56&type=chunk) - Weighted-average shares outstanding (basic and diluted) slightly decreased for the nine months ended June 30, 2023, compared to the prior year[56](index=56&type=chunk) [Note 11. Pension and Other Postretirement Benefit Plans](index=18&type=section&id=Note%2011.%20Pension%20and%20Other%20Postretirement%20Benefit%20Plans) Net Periodic Pension and Other Postretirement Benefit Cost (Amounts in thousands) | Metric | Nine Months Ended June 30, 2023 (Pension) | Nine Months Ended June 30, 2022 (Pension) | Nine Months Ended June 30, 2023 (Other Postretirement) | Nine Months Ended June 30, 2022 (Other Postretirement) | | :-------------------------------------- | :---------------------------------------- | :---------------------------------------- | :----------------------------------------------------- | :----------------------------------------------------- | | Service cost | $119 | $389 | $57 | $124 | | Interest cost | $354 | $1,086 | $483 | $308 | | Settlement losses | $1,271 | $30,856 | — | — | | Net benefit cost | $1,723 | $31,584 | $(265) | $159 | - In Q1 fiscal 2023, the Company made lump sum payments of **$24,242 thousand** to fully settle supplemental retirement plan (SERP) and officers retirement restoration plan (ORRP) obligations, resulting in a **$1,271 thousand** non-cash charge[59](index=59&type=chunk) - In Q1 fiscal 2022, the Company terminated its principal defined benefit retirement plan (DB Plan), making **$35,706 thousand** in contributions and **$185,958 thousand** in lump sum distributions, resulting in a **$30,856 thousand** non-cash charge[60](index=60&type=chunk) [Note 12. Accumulated Other Comprehensive Income (AOCI)](index=19&type=section&id=Note%2012.%20Accumulated%20Other%20Comprehensive%20Income) Changes in AOCI by Component (Attributable to Matthews, Amounts in thousands) | Component | Balance, Sep 30, 2022 | Net current-period OCI (9M FY23) | Balance, Jun 30, 2023 | | :------------------------------ | :-------------------- | :------------------------------- | :-------------------- | | Post-retirement benefit plans | $5,182 | $559 | $5,741 | | Currency translation adjustment | $(203,310) | $25,915 | $(177,395) | | Cash Flow Hedges | $7,937 | $(139) | $7,798 | | Total | $(190,191) | $26,335 | $(163,856) | - AOCI attributable to Matthews improved from a loss of **$190,191 thousand** at September 30, 2022, to a loss of **$163,856 thousand** at June 30, 2023, primarily driven by a positive currency translation adjustment of **$25,915 thousand** for the nine-month period[62](index=62&type=chunk) Reclassifications out of AOCI (Nine Months Ended June 30, 2023, Amounts in thousands) | AOCI Component | Amount Reclassified | Affected Line Item in Statement of Income | | :---------------------- | :------------------ | :---------------------------------------- | | Postretirement benefit plans | $(333) | Net income (Other income (deductions), net) | | Derivatives (Cash flow hedges) | $2,152 | Net income (Interest expense) | [Note 13. Income Taxes](index=23&type=section&id=Note%2013.%20Income%20Taxes) - Consolidated income taxes for the first nine months of fiscal 2023 were an expense of **$4,136 thousand**, a significant change from a benefit of **$2,311 thousand** in the prior year, primarily due to consolidated pre-tax income in fiscal 2023 versus a pre-tax loss in fiscal 2022[66](index=66&type=chunk) - The fiscal 2023 nine-month effective tax rate varied from the U.S. statutory rate of **21.0%** due to state taxes, foreign statutory rate differentials, tax credits, and non-tax benefited foreign losses[66](index=66&type=chunk) - Unrecognized tax benefits (excluding penalties and interest) were **$4,582 thousand** at June 30, 2023, with a potential decrease of approximately **$3,213 thousand** in the next 12 months due to audit completions and statute of limitations expirations[67](index=67&type=chunk) - Total penalties and interest accrued on tax uncertainties were **$959 thousand** at June 30, 2023[68](index=68&type=chunk) [Note 14. Segment Information](index=23&type=section&id=Note%2014.%20Segment%20Information) - The Company operates under three segments: Memorialization, Industrial Technologies, and SGK Brand Solutions[70](index=70&type=chunk) - Adjusted EBITDA is the primary measure of segment profitability, defined as earnings before interest, income taxes, depreciation, amortization, and certain non-cash/non-recurring items[71](index=71&type=chunk) Segment Sales and Adjusted EBITDA (Amounts in thousands) | Segment | Three Months Ended June 30, 2023 (Sales) | Three Months Ended June 30, 2022 (Sales) | Nine Months Ended June 30, 2023 (Sales) | Nine Months Ended June 30, 2022 (Sales) | | :------------------------ | :--------------------------------------- | :--------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Memorialization | $208,728 | $203,158 | $638,119 | $633,868 | | Industrial Technologies | $130,533 | $78,443 | $365,190 | $230,928 | | SGK Brand Solutions | $132,647 | $140,118 | $397,419 | $440,480 | | **Consolidated Sales** | **$471,908** | **$421,719** | **$1,400,728** | **$1,305,276** | | | Three Months Ended June 30, 2023 (Adj. EBITDA) | Three Months Ended June 30, 2022 (Adj. EBITDA) | Nine Months Ended June 30, 2023 (Adj. EBITDA) | Nine Months Ended June 30, 2022 (Adj. EBITDA) | | Memorialization | $39,929 | $32,090 | $127,096 | $118,404 | | Industrial Technologies | $15,041 | $11,809 | $42,808 | $33,377 | | SGK Brand Solutions | $16,364 | $14,546 | $39,616 | $43,422 | | Corporate and Non-Operating | $(15,146) | $(12,421) | $(45,594) | $(40,656) | | **Total Adjusted EBITDA** | **$56,188** | **$46,024** | **$163,926** | **$154,547** | - Industrial Technologies segment showed significant sales growth (**66.4%** for Q3, **58.1%** for 9M) and Adjusted EBITDA growth (**27.4%** for Q3, **28.2%** for 9M) year-over-year[74](index=74&type=chunk) - SGK Brand Solutions experienced sales declines (**5.3%** for Q3, **9.8%** for 9M) and a decrease in Adjusted EBITDA (**1.8%** for Q3, **8.8%** for 9M) year-over-year[74](index=74&type=chunk) [Note 15. Acquisitions](index=25&type=section&id=Note%2015.%20Acquisitions) - March 2023: Purchased remaining ownership in an Industrial Technologies subsidiary for **$4,759 thousand** - February 2023: Acquired Eagle Granite Company (Memorialization segment) for **$18,384 thousand**, including cash and deferred purchase price, plus potential contingent consideration of **$1,030 thousand** - Q1 Fiscal 2023: Completed small acquisitions in SGK Brand Solutions for a combined **$1,932 thousand** - Preliminary purchase price allocations for all fiscal 2023 acquisitions were not finalized as of June 30, 2023[78](index=78&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk) - August 2022: Acquired German engineering firms OLBRICH and R+S Automotive (Industrial Technologies segment) for approximately **€43,700 thousand ($44,469 thousand)**, significantly contributing to Industrial Technologies sales growth[81](index=81&type=chunk) [Note 16. Goodwill and Other Intangible Assets](index=26&type=section&id=Note%2016.%20Goodwill%20and%20Other%20Intangible%20Assets) Goodwill by Segment (Amounts in thousands) | Segment | Net Goodwill at Sep 30, 2022 | Additions during period | Translation and other adjustments | Net Goodwill at Jun 30, 2023 | | :------------------------ | :--------------------------- | :---------------------- | :-------------------------------- | :--------------------------- | | Memorialization | $361,782 | $2,682 | $2,739 | $367,203 | | Industrial Technologies | $107,022 | $6,756 | $795 | $114,573 | | SGK Brand Solutions | $206,617 | $1,924 | $12,599 | $221,140 | | **Consolidated** | **$675,421** | **$11,362** | **$16,133** | **$702,916** | - Consolidated goodwill increased by **$27,495 thousand (4.1%)** from September 30, 2022, to June 30, 2023, primarily due to additions from acquisitions and translation adjustments[82](index=82&type=chunk) - The annual impairment review in Q2 fiscal 2023 found no impairment charges necessary, with the SGK Brand Solutions reporting unit's fair value exceeding its carrying value by approximately **9%**[83](index=83&type=chunk) Intangible Assets, Net (Amounts in thousands) | Category | June 30, 2023 | September 30, 2022 | | :------------------------ | :------------ | :----------------- | | Indefinite-lived trade names | $30,540 | $30,540 | | Definite-lived trade names | $30,242 | $32,956 | | Customer relationships | $107,972 | $132,129 | | Copyrights/patents/other | $6,200 | $6,529 | | **Total Intangible Assets, Net** | **$174,954** | **$202,154** | - Net intangible assets decreased by **$27,200 thousand (13.5%)** from September 30, 2022, to June 30, 2023, mainly due to amortization and foreign currency fluctuations, partially offset by additions from the Eagle acquisition[86](index=86&type=chunk) - Amortization expense on intangible assets was **$31,499 thousand** for the nine months ended June 30, 2023, down from **$45,303 thousand** in the prior year[87](index=87&type=chunk) [Note 17. Asset Write-Downs](index=28&type=section&id=Note%2017.%20Asset%20Write-Downs) - During fiscal 2022, the Company recorded asset write-downs totaling **$10,017 thousand (net of recoveries)** related to its Russian operations within the SGK Brand Solutions segment, reducing the carrying value of these assets to zero due to regional instability[88](index=88&type=chunk) - These write-downs, primarily for property, plant and equipment, were reported within cost of sales (**$9,686 thousand**) and administrative expense (**$331 thousand**) for the nine months ended June 30, 2022[88](index=88&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, condition, outlook, segment analysis, liquidity, capital, and critical policies [Cautionary Statements Regarding Forward-Looking Statements and Non-GAAP Financial Measures](index=29&type=section&id=CAUTIONARY%20STATEMENTS%20REGARDING%20FORWARD-LOOKING%20STATEMENTS%20AND%20NON-GAAP%20FINANCIAL%20MEASURES) - Forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from expectations, including changes in economic conditions, foreign currency rates, interest rates, material costs, mortality/cremation rates, product demand, competitive pressures, supply chain disruptions, labor issues, acquisitions, cybersecurity, and global conflicts[90](index=90&type=chunk) - The Company uses non-GAAP financial measures (e.g., Adjusted EBITDA) to compare performance consistently by removing the impact of certain items not directly reflecting core operations, such as acquisition/divestiture costs, ERP integration costs, strategic initiatives, stock-based compensation, and non-service pension/postretirement expense[91](index=91&type=chunk)[93](index=93&type=chunk) [Results of Operations](index=29&type=section&id=RESULTS%20OF%20OPERATIONS) Consolidated Sales and Adjusted EBITDA (Amounts in thousands) | Metric | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :----------------------- | :------------------------------ | :------------------------------ | | Consolidated Sales | $1,400,728 | $1,305,276 | | Total Adjusted EBITDA | $163,926 | $154,547 | - Consolidated sales increased by **$95.5 million (7.3%)** for the nine months ended June 30, 2023, driven by Industrial Technologies and Memorialization segments, partially offset by SGK Brand Solutions and an unfavorable foreign currency impact of **$28.6 million**[96](index=96&type=chunk) - Memorialization sales increased due to improved price realization, higher granite memorial/mausoleum/cremation equipment sales, and the Eagle Granite acquisition, partially offset by lower casket/bronze memorial unit sales - Industrial Technologies sales surged due to the OLBRICH and R+S Automotive acquisitions, higher energy storage solutions, product identification, and warehouse automation sales - SGK Brand Solutions sales decreased due to lower brand sales in Europe, decline in cylinder products, and lower U.S./European retail-based sales, partially offset by improved price realization - Gross profit for the nine months ended June 30, 2023, was **$426.9 million (30.5% of sales)**, up from **$377.0 million (28.9% of sales)** in the prior year, reflecting higher sales, productivity improvements, and cost-reduction initiatives, despite higher material/labor costs[98](index=98&type=chunk)[99](index=99&type=chunk) - Selling and administrative expenses increased to **$333.6 million (23.8% of sales)** for the nine months ended June 30, 2023, from **$302.6 million (23.2% of sales)** in the prior year, due to higher salaries, travel, acquisition expenses, and receivables financing fees[100](index=100&type=chunk) - Interest expense increased to **$33.2 million** for the nine months ended June 30, 2023, from **$19.4 million** in the prior year, primarily due to higher average interest rates[102](index=102&type=chunk) - Other income (deductions), net, improved from a **$30.9 million** decrease in pre-tax income in fiscal 2022 to a **$3.0 million** decrease in fiscal 2023, mainly due to lower non-service pension and postretirement expenses (which included significant settlement charges in prior year)[102](index=102&type=chunk) - Income tax expense was **$4.1 million** for the nine months ended June 30, 2023, compared to a **$2.3 million** benefit in the prior year, reflecting the shift from a pre-tax loss to pre-tax income[103](index=103&type=chunk) - Asset write-downs of **$10.0 million** related to Russian operations were recorded in fiscal 2022 within the SGK Brand Solutions segment[105](index=105&type=chunk) [Non-GAAP Financial Measures](index=33&type=section&id=NON-GAAP%20FINANCIAL%20MEASURES) - Adjusted EBITDA is a non-GAAP measure used by management to assess business performance by excluding non-core operational items such as acquisition/divestiture costs, ERP integration costs, strategic initiatives, stock-based compensation, and non-service pension/postretirement expense[106](index=106&type=chunk)[107](index=107&type=chunk) Reconciliation of Net Income (Loss) to Adjusted EBITDA (Amounts in thousands) | Metric | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | | :-------------------------------------- | :------------------------------ | :------------------------------ | | Net income (loss) | $21,443 | $(18,871) | | Income tax (benefit) provision | $4,136 | $(2,311) | | Interest expense, including RPA and factoring financing fees | $35,944 | $19,426 | | Depreciation and amortization | $71,813 | $80,163 | | Acquisition and divestiture costs | $4,445 | $951 | | Strategic initiatives and other charges | $7,734 | $16,912 | | Highly inflationary accounting losses | $3,074 | — | | Asset write-downs | — | $10,017 | | Stock-based compensation | $13,635 | $14,128 | | Non-service pension and postretirement expense | $1,556 | $31,588 | | **Total Adjusted EBITDA** | **$163,926** | **$154,547** | - Total Adjusted EBITDA increased by **$9,379 thousand (6.1%)** for the nine months ended June 30, 2023, compared to the prior year, indicating improved operational performance before non-core adjustments[109](index=109&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) Cash Flow Summary (Nine Months Ended June 30, Amounts in thousands) | Cash Flow Activity | 2023 | 2022 | | :-------------------------------- | :---------- | :---------- | | Operating activities | $76,906 | $84,367 | | Investing activities | $(53,717) | $(38,929) | | Financing activities | $(56,357) | $(43,776) | | Net change in cash | $(32,119) | $(2,200) | | Cash, cash equivalents and restricted cash at end of period | $39,295 | $66,143 | - Operating cash flow decreased due to working capital changes and pension settlement payments, partially offset by cash flow hedge settlements. Investing cash flow increased due to higher capital expenditures and acquisitions. Financing cash flow increased due to net debt repayments and dividends[112](index=112&type=chunk)[113](index=113&type=chunk)[115](index=115&type=chunk) - Capital expenditures are estimated at **$65 million** for fiscal 2023, supporting new production capabilities and efficiencies in Memorialization and Industrial Technologies segments[114](index=114&type=chunk) - The Company has a **$750.0 million** senior secured revolving credit facility maturing in March 2025, with outstanding borrowings of **$450.3 million** at June 30, 2023, at a weighted-average interest rate of **5.59%**[116](index=116&type=chunk)[117](index=117&type=chunk) - The Company has **$299.6 million** of **5.25%** senior unsecured notes due December 1, 2025[118](index=118&type=chunk) - Working capital was **$239.5 million** at June 30, 2023, up from **$217.2 million** at September 30, 2022, with a current ratio of **1.6**[128](index=128&type=chunk) Long-Term Contractual Cash Obligations (Amounts in thousands) | Obligation | Total | 2023 Remainder | 2024 to 2025 | 2026 to 2027 | After 2027 | | :-------------------------- | :---------- | :------------- | :----------- | :----------- | :--------- | | Revolving credit facilities | $452,691 | — | $450,329 | — | $2,362 | | 2025 Senior Notes | $337,740 | — | $31,500 | $306,240 | — | | Finance lease obligations | $7,259 | $619 | $3,296 | $2,019 | $1,325 | | Non-cancelable operating leases | $82,438 | $6,642 | $45,455 | $22,735 | $7,606 | | Other | $26,688 | $229 | $11,736 | $5,965 | $8,758 | | **Total** | **$906,816**| **$7,490** | **$542,316** | **$336,959** | **$20,051**| [Regulatory Matters](index=38&type=section&id=REGULATORY%20MATTERS) - The Company's operations are subject to various federal, state, and local laws and regulations, including environmental protection, with internal compliance programs in place[132](index=132&type=chunk) - The Company is actively performing environmental assessments and remediation at certain sites[132](index=132&type=chunk) [Acquisitions](index=38&type=section&id=ACQUISITIONS) - Details on recent acquisitions are provided in Note 15, 'Acquisitions,' within Item 1 - 'Financial Statements'[133](index=133&type=chunk) [Forward-Looking Information](index=38&type=section&id=FORWARD-LOOKING%20INFORMATION) - The Company's strategy for annual operating growth includes internal growth (organic growth, cost structure/productivity improvements, new product development, market expansion) and acquisitions with related integration activities[134](index=134&type=chunk) - Industrial Technologies: Sales growth influenced by economic/industrial market conditions, new product development, and EV/e-commerce trends. Received over **$200 million** in new orders for energy storage solutions in Q1 fiscal 2023, impacting sales through mid-fiscal 2024 - Memorialization: Sales growth influenced by North America death rates and the increasing trend toward cremation - SGK Brand Solutions: Sales growth influenced by global economic conditions, brand innovation, client marketing spending, and government regulation - Recent labor cost increases, supply chain challenges, and inflation are expected to impact results, with mitigation efforts through price realization and cost-reduction initiatives[137](index=137&type=chunk) [Critical Accounting Policies](index=39&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES) - Financial statement preparation requires management estimates and assumptions, which may differ from actual results[138](index=138&type=chunk) - The annual impairment review of goodwill and indefinite-lived intangible assets in Q2 fiscal 2023 found no impairment, but future write-downs may be necessary if projections are not met or valuation factors change significantly[140](index=140&type=chunk) [Recently Issued Accounting Pronouncements](index=39&type=section&id=RECENTLY%20ISSUED%20ACCOUNTING%20PRONOUNCEMENTS) - Refer to Note 2, 'Basis of Presentation,' in Item 1 - 'Financial Statements,' for details on recently issued accounting pronouncements[141](index=141&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in the Company's market risk during the three and nine months ended June 30, 2023 - No material changes in the Company's market risk occurred during the three and nine months ended June 30, 2023[142](index=142&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective, with no material changes in internal controls over financial reporting - The Company's disclosure controls and procedures were evaluated and deemed effective as of June 30, 2023, providing reasonable assurance that material information is accumulated, communicated, recorded, summarized, and reported timely[143](index=143&type=chunk)[144](index=144&type=chunk) - No changes in internal controls over financial reporting occurred during the fiscal quarter ended June 30, 2023, that materially affected, or are reasonably likely to materially affect, the Company's internal controls over financial reporting[145](index=145&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) Ordinary course legal proceedings are not expected to materially affect financial condition or results - The Company is subject to various legal proceedings and claims arising in the ordinary course of business[147](index=147&type=chunk) - Management does not expect these legal proceedings to have a material adverse effect on Matthews' financial condition, results of operations, or cash flows[147](index=147&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors, which could adversely affect Company performance - No material changes in risk factors from those disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2022[148](index=148&type=chunk) - Existing risk factors, along with other information in this report, could adversely affect the Company's operating performance and financial condition[148](index=148&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Outlines the Company's stock repurchase program, purpose, authorization, and fiscal 2023 activity - The Company has a stock repurchase program designed to increase shareholder value, enlarge common stock holdings, and add to earnings per share[149](index=149&type=chunk) - As of June 30, 2023, **1,196,143 shares** remain available for repurchase under the current authorization[149](index=149&type=chunk) Fiscal 2023 Stock Repurchase Activity | Period | Total shares purchased | Weighted average price paid per share | | :------------ | :--------------------- | :------------------------------------ | | October 2022 | — | $— | | November 2022 | 88,042 | $27.54 | | December 2022 | 983 | $27.54 | | January 2023 | — | $— | | February 2023 | 549 | $37.09 | | March 2023 | 7,057 | $37.79 | | April 2023 | — | $— | | May 2023 | — | $— | | June 2023 | 2,068 | $38.86 | | **Total** | **98,699** | **$28.56** | [Item 3. Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities are reported - Not Applicable[151](index=151&type=chunk) [Item 4. Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) No mine safety disclosures are reported - Not Applicable[152](index=152&type=chunk) [Item 5. Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - None of the Company's directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the fiscal quarter ended June 30, 2023[153](index=153&type=chunk) [Item 6. Exhibits and Reports on Form 8-K](index=43&type=section&id=Item%206.%20Exhibits%20and%20Reports%20on%20Form%208-K) Lists exhibits filed with Form 10-Q, including corporate documents, officer certifications, and XBRL files - Exhibit 3.1: Restated Articles of Incorporation (incorporated by reference) - Exhibit 3.2: Restated By-laws (incorporated by reference) - Exhibit 31.1 & 31.2: Certifications of Principal Executive Officer and Principal Financial Officer (filed herewith) - Exhibit 32.1 & 32.2: Certifications Pursuant to 18 U.S.C. Section 1350 (furnished herewith) - Exhibits 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104: XBRL Taxonomy Extension and Cover Page Interactive Data File (filed herewith) SIGNATURES [Signatures](index=44&type=section&id=Signatures) Contains official signatures of Matthews International Corporation's CEO and CFO, certifying report filing - The report was signed on behalf of Matthews International Corporation by Joseph C. Bartolacci, President and Chief Executive Officer, and Steven F. Nicola, Chief Financial Officer and Secretary, on July 28, 2023[156](index=156&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk)

Matthews International Corporation (NASDAQ:MATW) Q3 2023 Results Conference Call July 28, 2023 9:00 AM ET Company Participants Bill Wilson - SD, Corporate Development Joe Bartolacci - President, CEO Steve Nicola - CFO Conference Call Participants Justin Bergner - Gabelli Liam Burke - B. Riley Pete Lukas - CJS Securities Operator Greetings, and welcome to the Matthews International Third Quarter Fiscal 2023 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being rec ...