Group 1 - Mayville Engineering Company (NYSE: MEC) has recently fallen short of expectations, despite being reaffirmed as a "Strong Buy" candidate in March [1] - The investment rationale was based on cash flow generation and growth prospects within the oil and natural gas sector [1] Group 2 - Crude Value Insights provides an investing service focused on oil and natural gas, emphasizing cash flow and companies with real potential for value and growth [1] - Subscribers have access to a 50+ stock model account and in-depth cash flow analyses of exploration and production (E&P) firms [2]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-38894 Mayville Engineering Company, Inc. (Exact Name of Registrant as Specified in its Charter) Wisconsin 39-094 ...

Image source: The Motley Fool. Wednesday, August 6, 2025 at 10 a.m. ET Call participants President and Chief Executive Officer — Jag Reddy Chief Financial Officer — Rachele Lehr Need a quote from a Motley Fool analyst? Email [email protected] Risks Commercial vehicle production is projected to decline by 24% in 2025 compared to 2024, withMayville Engineering Company(MEC -16.30%) no longer anticipating a second-half recovery in market demand for this segment. Net sales (GAAP) decreased by 19.1% year-over-yea ...

Financial Data and Key Metrics Changes - Total sales for Q2 2025 decreased by 19.1% year-over-year to $132.3 million, primarily due to soft customer demand and channel inventory destocking [20] - Adjusted EBITDA for Q2 was $13.7 million, down from $19.6 million in the prior year, with an adjusted EBITDA margin of 10.3%, a decrease of 170 basis points [22] - Free cash flow during Q2 was $12.5 million, compared to $19.2 million in the prior year, reflecting less cash generated from operating activities [23] Business Line Data and Key Metrics Changes - Manufacturing margin decreased to $13.6 million in Q2 from $22.3 million in the same prior year period, with a manufacturing margin rate of 10.3% compared to 13.6% [20][21] - The company secured its first cross-selling win after the acquisition of AccuFab, which is expected to generate revenues in the third quarter [10] Market Data and Key Metrics Changes - The commercial vehicle market is projected to see a 24% decline in production in 2025, with an expected production of approximately 252,000 units [9] - Customer orders in key end markets have remained soft, particularly in commercial vehicles, power sports, and agriculture [7] Company Strategy and Development Direction - The company completed the acquisition of AccuFab, which is expected to increase its serviceable addressable market by approximately 60% to $8 billion [6] - The focus remains on increasing share of wallet with existing customers and expanding into high-growth adjacent markets [5] - The company aims to achieve a billion dollars in revenue and adjusted EBITDA margins exceeding 15% in the long term [15] Management's Comments on Operating Environment and Future Outlook - Management has withdrawn the 2026 financial targets due to the current macro environment but believes the financial profile implied by those targets is achievable once demand normalizes [15] - The company does not expect a recovery in market demand in the second half of 2025, particularly in the commercial vehicle market [9][72] Other Important Information - The company has initiated cost reduction initiatives and is consolidating facilities to optimize its manufacturing footprint [10][28] - The updated 2025 financial guidance reflects expected net sales between $528 million and $562 million, with adjusted EBITDA between $49 million and $55 million [24] Q&A Session Summary Question: Insights on AccuFab integration and synergies - Management expressed excitement about the integration of AccuFab and the potential for significant commercial synergies, projecting AccuFab revenues to reach approximately $100 million by 2028 [34] Question: Clarification on market outlook and customer feedback - Management noted that the primary change in outlook is in the commercial vehicle market, with significant reductions in production capacity observed among key customers [38][40] Question: Discussion on military and other segments - Management indicated that the military segment remains stable, with ongoing programs expected to progress due to global conflicts and restocking of US inventories [92] Question: Future contracts and reshoring opportunities - Management highlighted an increase in requests for quotations driven by tariffs, indicating a potential for reshoring aluminum fabrications to the US [84] Question: Sustainability of military backlog and revenue sources - Most military programs are recurring, with a small portion from aftermarket services, ensuring a stable revenue stream [90]

MAYVILLE ENGINEERING COMPANY 2Q25 RESULTS PRESENTATION AUGUST 6, 2025 SAFE HARBOR STATEMENT Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995: This presentation contains statements that are forward -looking in nature which express the beliefs and expectations of management including statements regarding the Company's expected results of operations or liquidity; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financi ...

Financial Performance - Mayville Engineering reported quarterly earnings of $0.1 per share, matching the Zacks Consensus Estimate, but down from $0.18 per share a year ago [1] - The company posted revenues of $132.33 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 3.35%, compared to $163.64 million in the same quarter last year [2] - Over the last four quarters, Mayville Engineering has surpassed consensus EPS estimates two times and topped consensus revenue estimates just once [2][1] Stock Performance and Outlook - Mayville Engineering shares have increased approximately 4.6% since the beginning of the year, while the S&P 500 has gained 7.6% [3] - The company's current consensus EPS estimate for the upcoming quarter is $0.28 on revenues of $154.76 million, and for the current fiscal year, it is $0.72 on revenues of $585.77 million [7] Industry Context - The Engineering - R and D Services industry, to which Mayville Engineering belongs, is currently ranked in the bottom 39% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which may impact Mayville Engineering's stock performance [5]

Executive Summary [Introduction & Q2 2025 Highlights](index=1&type=section&id=1.1%20Introduction%20%26%20Q2%202025%20Highlights) MEC reported Q2 2025 net sales of $132.3 million and a net loss of $1.1 million amid a challenging demand environment Second Quarter 2025 Key Financial Highlights | Metric | Value | | :--- | :--- | | Net sales | $132.3 million | | GAAP Net loss | $1.1 million | | GAAP Diluted EPS | ($0.05) | | Non-GAAP Adjusted Net Income | $2.1 million | | Adjusted Diluted EPS | $0.10 | | Adjusted EBITDA | $13.7 million | | Adjusted EBITDA margin | 10.3% | | Free Cash Flow | $12.5 million | | Ratio of net debt to trailing twelve-month Adjusted EBITDA (as of June 30, 2025) | 1.4x | [Management Outlook & Strategic Priorities](index=1&type=section&id=1.2%20Management%20Outlook%20%26%20Strategic%20Priorities) Management addresses soft demand, focuses on operational efficiency, and updates guidance following the Accu-Fab acquisition - Customer demand remained soft throughout Q2 2025 due to elevated uncertainty across most end markets, with limited visibility for the second half of the year, particularly in **Commercial Vehicle, Powersports, and Agriculture**[3](index=3&type=chunk) - Operational focus includes strategic pricing, new project wins (ahead of full-year target), and working capital efficiency, alongside initiatives to reduce fixed costs and rationalize asset capacity[3](index=3&type=chunk) - The acquisition of **Accu-Fab** was completed shortly after quarter-end, marking a key milestone in strategic diversification, with integration expected by year-end[3](index=3&type=chunk)[5](index=5&type=chunk) - MEC updated its **full-year 2025 guidance** to reflect the Accu-Fab acquisition and soft industry demand in legacy markets, while withdrawing 2026 financial targets due to the uncertain macroeconomic environment[5](index=5&type=chunk) - Long-term vision is to build MEC into a scaled, diversified domestic fabricator with **$1.0 billion in revenue**, supported by organic growth, disciplined M&A, and consistent operational execution[5](index=5&type=chunk) [About Mayville Engineering Company](index=5&type=section&id=1.3%20About%20Mayville%20Engineering%20Company) MEC is a leading U.S.-based manufacturing partner serving diverse end markets with extensive capabilities - MEC is a leading U.S.-based, vertically-integrated manufacturing partner providing design, prototyping, tooling, fabrication, aluminum extrusion, coating, assembly, and aftermarket components[33](index=33&type=chunk) - Customers operate in diverse end markets including heavy- and medium-duty commercial vehicles, construction & access equipment, powersports, agriculture, military, and other markets[33](index=33&type=chunk) - MEC maintains an extensive manufacturing infrastructure with **27 facilities** (26 in use) across nine states, offering a broad range of manufacturing processes and finishing capabilities[33](index=33&type=chunk)[34](index=34&type=chunk) Second Quarter 2025 Financial Performance [Consolidated Financial Results Overview](index=2&type=section&id=2.1%20Consolidated%20Financial%20Results%20Overview) Net sales and profitability declined year-over-year due to lower demand, though cost reductions provided a partial offset Q2 2025 vs. Q2 2024 Financial Performance | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net sales | $132.3M | $163.6M | -19.1% | | GAAP Net loss (income) | ($1.1M) | $3.8M | N/A | | GAAP Diluted EPS | ($0.05) | $0.18 | N/A | | Adjusted Net Income | $2.1M | $5.5M | -61.8% | | Adjusted Diluted EPS | $0.10 | $0.26 | -61.5% | | Adjusted EBITDA | $13.7M | $19.6M | -30.1% | | Adjusted EBITDA margin | 10.3% | 12.0% | -1.7 pp | | Free Cash Flow | $12.5M | $19.2M | -34.8% | - The decrease in net sales was primarily due to **lower customer demand** across most key end markets and customer channel inventory de-stocking, partially offset by new projects and increased after-market demand in Military[6](index=6&type=chunk) Detailed Performance Analysis [Manufacturing Margin](index=2&type=section&id=2.2.1%20Manufacturing%20Margin) Manufacturing margin decreased in Q2 2025 due to lower customer demand, partially offset by cost reduction efforts Manufacturing Margin Performance | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Manufacturing margin | $13.6 million | $22.3 million | | % of net sales | 10.3% | 13.6% | | YoY Decrease | $8.7 million | 3.3 pp | [Operating Expenses](index=2&type=section&id=2.2.2%20Operating%20Expenses) Operating expenses were impacted by lower bonus costs and higher non-recurring acquisition and transition expenses Operating Expenses (Q2 2025 vs. Q2 2024) | Expense Category | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Bonuses and deferred compensation | $1.5 million | $4.1 million | -63.4% | | Other selling, general and administrative expenses | $10.3 million | $8.3 million | +24.1% | - Increase in other SG&A expenses primarily reflects **non-recurring costs** related to the Accu-Fab acquisition and CFO transition[8](index=8&type=chunk) [Interest Expense](index=2&type=section&id=2.2.3%20Interest%20Expense) Interest expense decreased significantly year-over-year due to reduced borrowings and lower interest rates Interest Expense (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Interest expense | $1.4 million | $3.0 million | -53.3% | - The decrease in interest expense was due to a **decrease in borrowings** and lower interest rates relative to the prior year period[9](index=9&type=chunk) End Market Performance [Overall End Market Sales](index=3&type=section&id=3.1%20Overall%20End%20Market%20Sales) Most end markets saw sales declines due to reduced demand, with Military and Other markets showing positive growth Net Sales by End Market (Three Months Ended June 30, in thousands) | End Market | 2025 | 2024 | YoY Change ($) | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Commercial Vehicle | $49,134 | $62,130 | ($12,996) | -20.9% | | Construction & Access | $20,173 | $27,230 | ($7,057) | -25.9% | | Powersports | $19,625 | $30,306 | ($10,681) | -35.2% | | Agriculture | $9,233 | $14,639 | ($5,406) | -36.9% | | Military | $8,342 | $6,579 | $1,763 | +26.8% | | Other | $25,821 | $22,752 | $3,069 | +13.5% | | **Total Net Sales** | **$132,328** | **$163,636** | **($31,308)** | **-19.1%** | [Commercial Vehicle](index=3&type=section&id=3.2%20Commercial%20Vehicle) Commercial vehicle net sales declined 20.9% year-over-year due to reduced customer demand and regulatory uncertainty Commercial Vehicle Net Sales | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $49.1 million | $62.1 million | -20.9% | - Decrease attributed to reduction in customer demand resulting from **regulatory uncertainty** and reduced order volumes[15](index=15&type=chunk) [Construction & Access](index=3&type=section&id=3.3%20Construction%20%26%20Access) Construction & access market sales fell 25.9% from the prior year, driven by lower demand and inventory de-stocking Construction & Access Net Sales | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $20.2 million | $27.2 million | -25.9% | - Decrease primarily attributable to **lower customer demand** and channel inventory de-stocking[17](index=17&type=chunk) [Powersports](index=3&type=section&id=3.4%20Powersports) Powersports market sales decreased substantially by 35.2% due to reduced consumer demand and product rationalization Powersports Net Sales | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $19.6 million | $30.3 million | -35.2% | - Decrease resulted from **reduced consumer demand**, customer product rationalization, and channel inventory de-stocking[19](index=19&type=chunk) [Agriculture](index=3&type=section&id=3.5%20Agriculture) Agriculture market net sales declined 36.9% year-over-year, reflecting lower demand and customer inventory de-stocking Agriculture Net Sales | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $9.2 million | $14.6 million | -36.9% | - Decrease reflects lower customer demand across both large-ag and small-ag end markets as customers **de-stock their inventory**[21](index=21&type=chunk) [Military](index=4&type=section&id=3.6%20Military) The military market demonstrated growth with a 26.8% year-over-year increase in net sales from after-market demand Military Net Sales | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $8.3 million | $6.6 million | +26.8% | - Increase primarily attributable to **higher service and after-market demand**[23](index=23&type=chunk) [Other End Markets](index=4&type=section&id=3.7%20Other%20End%20Markets) Other end markets grew 13.5% year-over-year, driven by new customer projects and increased automotive demand Other End Markets Net Sales | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net Sales | $25.8 million | $22.8 million | +13.5% | - Increase primarily attributable to **new customer projects** within industrial equipment & fixtures and power generation end markets, and higher demand for aluminum extrusions within the automotive end market[25](index=25&type=chunk) Financial Position & Guidance [Balance Sheet Update](index=4&type=section&id=4.1%20Balance%20Sheet%20Update) MEC maintained a healthy balance sheet with a net debt to Adjusted EBITDA ratio of 1.4x as of June 30, 2025 Balance Sheet Highlights (as of June 30, 2025) | Metric | Value | | :--- | :--- | | Debt outstanding | $72.0 million | | Total cash and availability on senior secured revolving credit facility | $185.21 million | | Debt repaid during Q2 2025 | $8.7 million | | Shares repurchased during Q2 2025 | $2.9 million | | Ratio of net debt to trailing twelve-month Adjusted EBITDA | 1.4x | [Full-Year 2025 Financial Guidance](index=4&type=section&id=4.2%20Full-Year%202025%20Financial%20Guidance) Full-year 2025 guidance was revised to reflect the Accu-Fab acquisition and continued softness in legacy markets Full-Year 2025 Financial Guidance Update (in Millions) | Metric | FY 2024 Actual | FY 2025 Forecast (Low-Mid-High) | Prior FY 2025 Forecast (Low-Mid-High) | | :--- | :--- | :--- | :--- | | Net Sales | $581.6 | $528 - $545 - $562 | $560 - $575 - $590 | | Adjusted EBITDA | $64.4 | $49 - $52 - $55 | $60 - $63 - $66 | | Free Cash Flow | $77.7 | $25 - $28 - $31 | $43 - $47 - $50 | - The 2025 guidance reflects the acquisition of **Accu-Fab** (completed July 1, 2025) and the impact of continued soft end market demand in legacy markets[28](index=28&type=chunk) - Free Cash Flow guidance includes capital expenditures of **$13-$17 million** and non-recurring costs of **$5-$6 million** related to the CFO transition and Accu-Fab acquisition[29](index=29&type=chunk) Supplemental Information [Non-GAAP Financial Measures](index=6&type=section&id=5.1%20Non-GAAP%20Financial%20Measures) This section defines non-GAAP financial measures used by management as key performance indicators for investors - Non-GAAP measures used include EBITDA, EBITDA Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Diluted EPS, and Free Cash Flow[35](index=35&type=chunk) - These measures are used by management as key performance indicators and are believed to be frequently used by securities analysts and investors to evaluate companies in the industry[36](index=36&type=chunk) - Non-GAAP measures are supplemental and should not be considered as alternatives to GAAP measures or as substitutes for analysis of GAAP results[36](index=36&type=chunk) Condensed Consolidated Financial Statements [Balance Sheets](index=7&type=section&id=5.2.1%20Balance%20Sheets) The balance sheet shows MEC's financial position as of June 30, 2025, compared to December 31, 2024 Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $113,728 | $112,944 | | Property, plant and equipment, net | $147,313 | $156,528 | | Goodwill | $92,650 | $92,650 | | Total assets | $433,745 | $445,570 | | Total current liabilities | $69,596 | $64,592 | | Bank revolving credit notes | $69,280 | $79,725 | | Total liabilities | $186,902 | $193,817 | | Total shareholders' equity | $246,843 | $251,753 | [Statements of Net Income (Loss)](index=8&type=section&id=5.2.2%20Statements%20of%20Net%20Income%20(Loss)) The income statement details financial performance for Q2 and H1 2025, showing a decline in net sales and net income Condensed Consolidated Statements of Net Income (Loss) (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $132,328 | $163,636 | $267,907 | $324,905 | | Income from operations | $76 | $8,150 | $1,654 | $15,780 | | Net income (loss) | ($1,097) | $3,782 | ($1,077) | $7,023 | | Diluted EPS | ($0.05) | $0.18 | ($0.05) | $0.34 | [Statements of Cash Flows](index=9&type=section&id=5.2.3%20Statements%20of%20Cash%20Flows) The cash flow statement illustrates sources and uses of cash, showing lower operating cash flow in H1 2025 Condensed Consolidated Statements of Cash Flows (in thousands, Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $23,307 | $33,900 | | Net cash used in investing activities | ($5,402) | ($6,767) | | Net cash used in financing activities | ($17,905) | ($27,491) | | Net increase (decrease) in cash and cash equivalents | $0 | ($358) | | Cash and cash equivalents at end of period | $206 | $314 | Reconciliation of Non-GAAP Measures [EBITDA and Adjusted EBITDA Reconciliation](index=10&type=section&id=5.3.1%20EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) This table reconciles GAAP net income (loss) to non-GAAP EBITDA and Adjusted EBITDA for Q2 and H1 2025 Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | ($1,097) | $3,782 | ($1,077) | $7,023 | | EBITDA | $9,679 | $17,541 | $20,740 | $34,425 | | Adjusted EBITDA | $13,675 | $19,639 | $26,667 | $38,159 | | Adjusted EBITDA Margin | 10.3% | 12.0% | 10.0% | 11.7% | [Adjusted Net Income and Diluted EPS Reconciliation](index=10&type=section&id=5.3.2%20Adjusted%20Net%20Income%20and%20Diluted%20EPS%20Reconciliation) This table reconciles GAAP net income (loss) and diluted EPS to their non-GAAP adjusted counterparts Reconciliation of Net Income (Loss) and Diluted EPS to Adjusted Net Income and Diluted EPS (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | ($1,097) | $3,782 | ($1,077) | $7,023 | | Diluted EPS | ($0.05) | $0.18 | ($0.05) | $0.34 | | Adjusted net income | $2,100 | $5,497 | $3,909 | $10,103 | | Adjusted Diluted EPS | $0.10 | $0.26 | $0.17 | $0.48 | [Free Cash Flow Reconciliation](index=10&type=section&id=5.3.3%20Free%20Cash%20Flow%20Reconciliation) This table reconciles net cash from operating activities to Free Cash Flow for Q2 and H1 2025 Reconciliation of Free Cash Flow (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $14,976 | $23,275 | $23,307 | $33,900 | | Less: Capital expenditures | $2,446 | $4,099 | $5,408 | $6,874 | | Free cash flow | $12,530 | $19,176 | $17,899 | $27,026 | [Conference Call Details](index=5&type=section&id=5.4%20Conference%20Call%20Details) Details are provided for the Q2 2025 results conference call scheduled for August 6, 2025 - Conference call scheduled for **Wednesday, August 6, 2025**, at 10:00 a.m. Eastern Time (9:00 a.m. Central Time)[30](index=30&type=chunk) - Live webcast and investor presentation available on www.mecinc.com (Investors page)[30](index=30&type=chunk) - Telephone access: (833) 470-1428 (US) or (833) 950-0062 (Canada), Access Code: 584482[31](index=31&type=chunk) [Forward-Looking Statements](index=5&type=section&id=5.5%20Forward-Looking%20Statements) This section contains a standard disclaimer regarding forward-looking statements and associated risks - The press release includes forward-looking statements reflecting plans, estimates, and beliefs, which involve risks and uncertainties[32](index=32&type=chunk) - Actual results may differ materially from forward-looking statements due to various factors, including macroeconomic conditions, industry developments, competition, raw material volatility, and integration of acquisitions[32](index=32&type=chunk) - The company undertakes no obligation to update or revise any forward-looking statements after the date made, except as required by federal securities laws[32](index=32&type=chunk)

Core Viewpoint - Mayville Engineering Company, Inc. (MEC) has announced a definitive agreement to acquire Accu-Fab, LLC for a total value of $140.5 million, expected to close in Q3 2025, which is anticipated to enhance MEC's business growth and operational efficiency [1][3][4]. Company Overview - Accu-Fab is a vertically integrated contract manufacturer providing design, engineering, sheet metal fabrication, and specialized finishing services to large OEMs, operating in approximately 200,000 square feet of manufacturing space across Raleigh, NC, and Wheeling, IL [2]. Financial Impact - Accu-Fab reported total net sales of approximately $61 million and adjusted EBITDA of about $14 million for 2024, with an adjusted EBITDA margin exceeding 23%, indicating a positive contribution to MEC's financials post-acquisition [3]. - MEC expects the acquisition to contribute $28-$32 million to net sales and $6-$8 million to adjusted EBITDA in 2025, along with an anticipated $1 million in annual cost synergies by 2026 through the implementation of its MBX framework [4]. Strategic Benefits - The acquisition is expected to strengthen MEC's market presence and accelerate entry into new markets, leveraging Accu-Fab's customer relationships and value-added services to drive revenue and cost synergies [5]. - MEC's focus on operational improvements and cost discipline, alongside strategic pricing and capital efficiency initiatives, positions the company well amid macroeconomic uncertainties [7]. Stock Performance - Following the acquisition announcement, MEC's stock rose by 5.2% in a single trading day, and the stock has increased by 26.7% over the past month, outperforming the Zacks Engineering - R and D Services industry's growth of 13.3% [1][5].

Summary of Mayville Engineering Company (MEC) Acquisition Call Company and Industry - **Company**: Mayville Engineering Company (MEC) - **Acquired Company**: AccuFab LLC - **Industry**: Metal fabrication solutions, focusing on high growth end markets such as critical power infrastructure, data centers, and renewable energy Key Points and Arguments 1. **Acquisition Details**: MEC announced the acquisition of AccuFab for a total cash consideration of $140.5 million, with customary adjustments expected to close in Q3 2025 [4][5][13] 2. **Strategic Fit**: AccuFab is a vertically integrated provider, enhancing MEC's geographic footprint and allowing for better service to customers in high growth markets [4][5] 3. **Cultural Alignment**: AccuFab's technology-forward approach and strong innovation track record complement MEC's operations [5] 4. **Financial Impact**: The acquisition is expected to be immediately accretive to adjusted EBITDA, margin, and earnings per share, with projected revenues of $28 million to $32 million and adjusted EBITDA of $6 million to $8 million in the second half of 2025 [14][15] 5. **Operational Synergies**: MEC anticipates generating approximately $1 million in annual cost synergies by 2026 through the implementation of its MBX Lean manufacturing framework [10][11] 6. **Market Diversification**: The acquisition allows MEC to diversify into less cyclical, high-growth markets, moving away from its legacy focus on wheeled mobility platforms [8][9] 7. **Revenue Synergies**: MEC estimates potential revenue synergies of $3 million to $5 million over the next 24 months, with further upside as customer relationships deepen [10] 8. **Capacity Utilization**: AccuFab is currently operating at 50-60% capacity, providing an opportunity for MEC to drive incremental volume and growth [11][61] 9. **Customer Base**: AccuFab's top 10 customers account for approximately 75% of its revenue, with limited overlap with MEC's existing customer base [33] 10. **Debt Management**: MEC plans to prioritize free cash flow generation to reduce net leverage from approximately three times to 1.5-2 times within 18 months post-acquisition [15][39] Additional Important Information - **Integration Timeline**: The initial integration process is expected to take about six months [6] - **Management Retention**: The current management team at AccuFab will remain post-acquisition, facilitating a smoother integration process [50] - **CapEx Requirements**: Expected annual capital investment for AccuFab is projected to be between $2 million and $3 million, aligning with MEC's previous guidance [39] - **Market Growth**: The data center and critical power markets are projected to grow by 20% from 2023 to 2024, making them attractive for MEC's expansion [25] - **Competitive Landscape**: AccuFab operates in a competitive environment with significant players, but its 95% sole-source revenue indicates strong customer reliance [71] This summary encapsulates the key aspects of the acquisition call, highlighting the strategic rationale, financial implications, and operational plans associated with the acquisition of AccuFab by Mayville Engineering Company.

MEC ACQUISITION OF ACCU-FAB MAY 27, 2025 SAFE HARBOR STATEMENT Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995: This presentation contains statements that are forward-looking in nature which express the beliefs and expectations of management including statements regarding the Company's expected results of operations or liquidity; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results and ...