Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 Commission File No. 1-15579 OR MSA SAFETY INCORPORATED (Exact name of registrant as specified in its charter) Pennsylvania 46-4914539 (State or other jurisd ...

MSA Safety Incorporated (NYSE:MSA) Q4 2021 Earnings Conference Call February 18, 2022 8:30 AM ET Company Participants Chris Hepler - Executive Director, Corporate Development and Investor Relations Nish Vartanian - Chairman, President and Chief Executive Officer Ken Krause - Senior Vice President, Chief Financial Officer and Treasurer Steve Blanco - President of Americas Bob Leenen - President of International. Conference Call Participants Stanley Elliott - Stifel Rob Mason - Baird Operator Good day. And we ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended September 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File No. 1-15579 MSA SAFETY INCORPORATED (Exact name of registrant as specified in its charter) Pennsylvania 46-4914539 (State or other jurisdiction of incorporation or organization) 1000 Cranbe ...

MSA Safety William Blair 'What's Next for Industrials' Conference September 23, 2021 Safe Harbor Except for historical information, certain matters discussed in this document may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, all projections and anticipated levels of future performance. These forward looking statements involve risks, uncertainties and other factors that may cause our actual res ...

MSA Safety Incorporated (NYSE:MSA) Q2 2021 Earnings Conference Call July 29, 2021 8:30 AM ET Company Participants Elyse Lorenzato - Investor Relations Nish Vartanian - Chairman, President and Chief Executive Officer Ken Krause - Senior Vice President, Chief Financial Officer and Treasurer Conference Call Participants Stanley Elliott - Stifel Rob Mason - Baird Brendan Popson - CJS Securities Larry De Maria - William Blair Chris McGinnis - Sidoti & Company Operator Good day and welcome to the MSA Second Quart ...

[PART I. FINANCIAL INFORMATION](index=2&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) MSA Safety reported H1 2021 net sales of $649.7 million, a slight decrease, with net income at $61.5 million and total assets growing to $1.96 billion [Condensed Consolidated Statements of Income](index=2&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q2 2021 net sales increased to $341.3 million, but operating income and net income declined due to higher product liability expense, with six-month net income also dropping Condensed Consolidated Statements of Income (In thousands) | Financial Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $341,289 | $314,438 | $649,717 | $655,583 | | **Gross Profit** | $152,915 | $141,597 | $287,654 | $298,956 | | **Operating Income** | $35,050 | $48,294 | $79,088 | $107,076 | | **Net Income Attributable to MSA** | $25,125 | $36,066 | $61,539 | $79,741 | | **Diluted EPS** | $0.64 | $0.92 | $1.56 | $2.03 | - Product liability expense significantly increased to **$11.8 million** in Q2 2021 from just **$0.9 million** in Q2 2020, heavily impacting operating income[6](index=6&type=chunk) [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$1.96 billion** by June 30, 2021, driven by higher inventories, while total liabilities also grew, and shareholders' equity rose to **$848.8 million** Condensed Consolidated Balance Sheets (In thousands) | Balance Sheet Item (In thousands) | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Current Assets** | $769,982 | $754,278 | | **Total Assets** | $1,963,233 | $1,872,484 | | **Total Current Liabilities** | $317,841 | $310,545 | | **Total Liabilities** | $1,114,465 | $1,062,593 | | **Total Shareholders' Equity** | $848,768 | $809,891 | - Inventories increased from **$197.8 million** at the end of 2020 to **$232.7 million** as of June 30, 2021[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow remained stable at **$83.9 million** for H1 2021, while investing activities used **$58.2 million** primarily for acquisitions, leading to a **$13.4 million** increase in cash Condensed Consolidated Statements of Cash Flows (In thousands) | Cash Flow Activity (In thousands) | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | | **Cash Flow From Operating Activities** | $83,914 | $83,031 | | **Cash Flow Used in Investing Activities** | $(58,175) | $(29,153) | | **Cash Flow Used in Financing Activities** | $(11,455) | $(66,176) | | **Increase (decrease) in cash** | $13,377 | $(15,952) | | **Ending cash, cash equivalents and restricted cash** | $174,411 | $136,591 | - A significant use of cash in investing activities was **$63.0 million** for an acquisition, net of cash acquired[15](index=15&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail **$8.4 million** in restructuring charges, segment sales, a rise in product liability reserves, the **$63.0 million** Bristol Uniforms acquisition, and subsequent acquisitions of Bacharach for **$337 million** and a China joint venture interest for **$19 million** - Restructuring charges of **$8.4 million** were recorded in the first six months of 2021, primarily related to initiatives in the International segment to drive profitable growth and right-size operations[22](index=22&type=chunk) - On January 25, 2021, the company acquired Bristol Uniforms and Bell Apparel for **$63.0 million** in an all-cash transaction to strengthen its position in the fire service PPE market[96](index=96&type=chunk) - Subsequent to the quarter end, on July 1, 2021, the company acquired Bacharach, Inc. for **$337 million** and also purchased the remaining **10%** noncontrolling interest in its China subsidiary for **$19 million**[106](index=106&type=chunk)[108](index=108&type=chunk) - The total reserve for cumulative trauma product liability was **$226.1 million** at June 30, 2021, an increase from **$221.5 million** at year-end 2020, reflecting a rise in asserted claims[78](index=78&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 2021 net sales grew **8.6%** to **$341.3 million**, but operating income declined due to increased product liability and SG&A, while H1 net sales slightly decreased, and liquidity remains strong after strategic acquisitions [Business Overview and Strategy](index=28&type=section&id=Business%20Overview%20and%20Strategy) MSA, a global safety product leader, focuses on core offerings comprising **89%** of sales, strategically expanding through acquisitions like Bristol Uniforms and Bacharach into fire service PPE and HVAC-R gas detection markets - Core products, including breathing apparatus, gas detection, and head protection, accounted for about **89%** of sales for the first six months of 2021[123](index=123&type=chunk) - The acquisition of Bristol Uniforms strengthens MSA's position as a global leader in fire service personal protective equipment (PPE) and provides an avenue to expand in the U.K. and key European markets[114](index=114&type=chunk) - The company estimates its end market exposure is approximately **35-40%** to the fire service market and **25-30%** to the energy market[125](index=125&type=chunk) [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Q2 2021 net sales grew **8.6%** to **$341.3 million**, but GAAP operating income declined significantly due to higher product liability and SG&A expenses, while H1 net sales slightly decreased with gross margin contraction Q2 2021 vs Q2 2020 Performance | Metric | Q2 2021 | Q2 2020 | Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $341.3M | $314.4M | +8.6% | | **Gross Profit** | $152.9M | $141.6M | +8.0% | | **GAAP Operating Income** | $35.1M | $48.3M | -27.3% | | **Net Income** | $25.1M | $36.1M | -30.5% | Six Months 2021 vs Six Months 2020 Performance | Metric | H1 2021 | H1 2020 | Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $649.7M | $655.6M | -0.9% | | **Gross Profit** | $287.7M | $299.0M | -3.8% | | **GAAP Operating Income** | $79.1M | $107.1M | -26.1% | | **Net Income** | $61.5M | $79.7M | -22.8% | - Q2 2021 SG&A expenses increased **20.8%** to **$83.4 million**, driven by **$8 million** in costs related to the Bacharach and Bristol acquisitions[135](index=135&type=chunk) - Product liability expense for Q2 2021 was **$11.8 million** compared to just **$0.9 million** in the prior-year quarter, due to an increase in asserted claims[140](index=140&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained strong liquidity with **$174.4 million** in cash and stable operating cash flow, financing the **$337 million** Bacharach acquisition with new senior notes and revolving credit - Cash and cash equivalents stood at **$174.4 million** as of June 30, 2021, with **$156.0 million** held by foreign subsidiaries[180](index=180&type=chunk) - Operating cash flow was **$83.9 million** for the first half of 2021, nearly flat compared to **$83.0 million** in the same period of 2020[182](index=182&type=chunk) - The acquisition of Bacharach on July 1, 2021 for **$337 million** was financed through a combination of **$200 million** in new **2.69%** Senior Notes and borrowings from the Revolving Credit Facility[186](index=186&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from currency fluctuations, with a **10%** USD change impacting Q2 sales by **$15.6 million**, and interest rate risk from **$241.0 million** in variable-rate debt, mitigated by **$99.2 million** in forward contracts - A hypothetical **10%** strengthening or weakening of the U.S. dollar would impact Q2 2021 reported sales by approximately **$15.6 million** (**4.6%**) and net income by **$1.2 million** (**3.5%**)[198](index=198&type=chunk) - As of June 30, 2021, the company had **$241.0 million** of variable rate borrowings, exposing it to interest rate fluctuations[202](index=202&type=chunk) - The company held open foreign currency forward contracts with a U.S. dollar notional value of **$99.2 million** to manage currency risk[199](index=199&type=chunk) [Item 4. Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) The company's disclosure controls and procedures were deemed effective as of June 30, 2021, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[204](index=204&type=chunk) - No changes occurred in the company's internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, these controls[204](index=204&type=chunk) [PART II. OTHER INFORMATION](index=42&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant product liability risks, including **1,610** cumulative trauma lawsuits against MSA LLC, which is largely self-insured, potentially leading to losses exceeding current reserves - The company faces inherent risk from product liability claims, which could lead to significant expense, recalls, and negative publicity[205](index=205&type=chunk) - Subsidiary MSA LLC was a defendant in **1,610** cumulative trauma lawsuits with **3,942** claims as of June 30, 2021, related to historical products and alleged exposure to substances like silica, asbestos, and coal dust[206](index=206&type=chunk) - MSA LLC is now largely self-insured for cumulative trauma claims, meaning future losses could exceed the established reserves and have a material adverse effect on the company's financial condition[206](index=206&type=chunk)[208](index=208&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q2 2021, the company purchased **975** shares at an average of **$167.29** for stock compensation, separate from its active **$100 million** share repurchase program Share Purchases in Q2 2021 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 2021 | 0 | $— | | May 2021 | 950 | $167.46 | | June 2021 | 25 | $160.99 | - Share purchases during the quarter were related to stock compensation transactions, not the formal share repurchase program[211](index=211&type=chunk) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL interactive data files - The exhibits filed with this report include CEO and CFO certifications and XBRL data files[214](index=214&type=chunk)

Financial Data and Key Metrics Changes - Quarterly revenue was $308 million, down 10% year-over-year or 11% in constant currency [23] - Gross profit declined 240 basis points from a year ago, primarily due to lower demand and inefficiencies in factories [27] - Quarterly adjusted operating margin was down 330 basis points due to gross profit headwinds and lower revenue volume [31] Business Line Data and Key Metrics Changes - The Fire Service business declined 16% compared to the previous year, but order activity showed improvement in April [24] - Industrial PPE revenue showed a return to growth in March and April, with orders up 9% in March and double digits in April year-over-year [25] - Air purifying respirators faced tough comparisons due to the initial pandemic surge last year, but demand is expected to improve as stimulus packages are allocated [26] Market Data and Key Metrics Changes - Revenue in the Americas was down about 9%, while international revenue was down 16%, reflecting COVID lockdown impacts in key geographies like France and Germany [23] - The backlog in the Fire Service remains healthy, supported by funding allocated to first responders in U.S. stimulus packages [26] Company Strategy and Development Direction - The company is focusing on three key areas: strengthening its innovation engine, continuous improvement culture, and strategic acquisitions [20] - The acquisition of Bristol Uniforms is expected to enhance MSA's position in the U.K. fire service market [18] - The company is actively pursuing M&A opportunities while maintaining a disciplined approach to ensure shareholder value [70] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about recovery trends in March and April, indicating a stronger order book moving into Q2 [36] - The company is navigating supply chain challenges but remains confident in its ability to create value as macroeconomic conditions improve [9] - Management highlighted the importance of federal funding for PPE and fire service products as a positive driver for future growth [66] Other Important Information - The company generated cash flow conversion in excess of 100% of net income, with operating cash flow up more than 200% compared to a year ago [33] - The company is experiencing inflation in supply chain areas but is managing it effectively [9] Q&A Session Summary Question: Improvement in bookings for March and April - Management noted significant sequential improvement in order activity, with March and April showing stronger performance than the same months in previous years [40][41] Question: Revenue contribution from Bristol acquisition - The Bristol acquisition contributed approximately $4 million in revenue for the two months of ownership during Q1 [44] Question: Gross margin recovery potential - Management indicated that about 125 basis points of margin recovery is expected as volume increases, with pricing adjustments anticipated in Q3 [49][50] Question: Demand recovery in energy and oil and gas sectors - Management confirmed a recovery in demand within the oil and gas sector, with increased activity noted in fixed gas and flame detection projects [58][59] Question: M&A strategy in the current environment - Management emphasized a disciplined approach to M&A, with a full pipeline of opportunities while ensuring value creation for shareholders [70][72] Question: Future opportunities for respirators post-COVID - Management highlighted potential opportunities for respirator capacity utilization, particularly with federal funding for stockpiles [74]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) Presents MSA Safety's unaudited condensed consolidated financial statements for Q1 2021, including income, comprehensive income, balance sheets, cash flows, and equity, with explanatory notes on key accounting events [Condensed Consolidated Statements of Income](index=2&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q1 2021 vs Q1 2020 Income Statement | Metric (in thousands, except per share) | Q1 2021 | Q1 2020 | | :--- | :--- | :--- | | Net sales | $308,428 | $341,145 | | Gross profit | $134,740 | $157,359 | | Operating income | $44,038 | $58,782 | | Net income attributable to MSA | $36,414 | $43,674 | | Diluted EPS | $0.92 | $1.11 | | Dividends per common share | $0.43 | $0.42 | [Condensed Consolidated Statements of Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Comprehensive income attributable to MSA Safety Incorporated was **$29.9 million** for Q1 2021, an increase from **$24.6 million** in Q1 2020, primarily due to a smaller negative impact from foreign currency translation adjustments[10](index=10&type=chunk) [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Summary | Metric (in thousands) | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Total current assets | $764,578 | $754,278 | | Total assets | $1,942,762 | $1,872,484 | | Total current liabilities | $306,727 | $310,545 | | Total liabilities | $1,119,872 | $1,062,593 | | Total shareholders' equity | $822,890 | $809,891 | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (Three Months Ended March 31) | Metric (in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Cash Flow From Operating Activities | $45,616 | $13,607 | | Cash Flow Used in Investing Activities | $(52,509) | $(26,082) | | Cash Flow From (Used in) Financing Activities | $31,639 | $(13,328) | | Increase (decrease) in cash | $24,026 | $(29,559) | | Ending cash, cash equivalents and restricted cash | $185,060 | $122,984 | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) - In Q1 2021, the company recorded restructuring charges of **$1.3 million**, primarily related to initiatives in the International segment to drive profitable growth and optimize operations[23](index=23&type=chunk) Sales by Reportable Segment (Three Months Ended March 31) | Segment (in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Americas | $208,340 | $231,253 | | International | $100,088 | $109,892 | | **Total** | **$308,428** | **$341,145** | - The company's effective tax rate for Q1 2021 was **21.0%**, consistent with the U.S. federal statutory rate, compared to **23.0%** in Q1 2020[43](index=43&type=chunk) - As of March 31, 2021, a subsidiary (MSA LLC) was a defendant in **1,632 lawsuits** involving **3,043 cumulative trauma product liability claims**, with a total reserve for these claims of **$216.8 million**[70](index=70&type=chunk)[73](index=73&type=chunk) - On January 25, 2021, MSA acquired Bristol Uniforms and Bell Apparel for **$63.0 million** in an all-cash transaction, strengthening MSA's position in fire service PPE in the U.K. and European markets[89](index=89&type=chunk)[90](index=90&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2021 financial results, noting a **9.6% decrease in net sales** due to economic challenges and pre-pandemic comparisons, while detailing segment performance, gross margin, cost controls, the Bristol acquisition, and liquidity [Business Overview](index=26&type=section&id=Business%20Overview) - MSA is a global leader in safety products, with core offerings including breathing apparatus, gas and flame detection systems, and head protection, representing approximately **88% of sales** in Q1 2021[102](index=102&type=chunk)[110](index=110&type=chunk) - The company acquired Bristol Uniforms and Bell Apparel on January 25, 2021, for **$63.0 million** to strengthen its fire service PPE business in the U.K. and Europe[103](index=103&type=chunk) - MSA is considered an essential business and has continued manufacturing operations during the COVID-19 pandemic, focusing on employee safety, business continuity, and expense management[104](index=104&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Q1 2021 vs Q1 2020 Performance | Metric | Q1 2021 | Q1 2020 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $308.4M | $341.1M | $(32.7)M | (9.6)% | | Gross Profit | $134.7M | $157.4M | $(22.7)M | (14.4)% | | Gross Margin | 43.7% | 46.1% | (2.4) p.p. | N/A | | SG&A Expenses | $75.5M | $80.2M | $(4.7)M | (5.9)% | | Operating Income | $44.0M | $58.8M | $(14.8)M | (25.2)% | - The decrease in sales was driven by economic challenges and a difficult comparison to a pre-pandemic Q1 2020, notably impacting industrial PPE and Fixed Gas & Flame Detection (FGFD)[116](index=116&type=chunk) - The gross profit ratio declined from **46.1%** to **43.7%** due to lower factory throughput, inventory charges for respiratory protection, unfavorable product mix, and higher input costs[120](index=120&type=chunk) - SG&A expenses decreased by **5.9%** due to savings from restructuring and discretionary cost controls, offsetting additional expenses from the Bristol acquisition[121](index=121&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) - The company's main sources of liquidity are operating cash flows and borrowings, with cash and cash equivalents totaling **$185.1 million** at March 31, 2021[140](index=140&type=chunk)[141](index=141&type=chunk) - Operating activities provided **$45.6 million** in cash for Q1 2021, a significant improvement from **$13.6 million** in Q1 2020, primarily due to better working capital management[143](index=143&type=chunk) - Investing activities used **$52.5 million**, largely for the Bristol acquisition (**$63.0 million**) and capital expenditures (**$9.6 million**)[145](index=145&type=chunk)[89](index=89&type=chunk) - Financing activities provided **$31.6 million**, reflecting net proceeds from long-term debt of **$52.0 million** used to fund the acquisition, partially offset by dividend payments of **$16.8 million**[146](index=146&type=chunk) [Critical Accounting Policies and Estimates](index=33&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - Due to the Q1 2021 acquisition, 'Business Combinations' has been added as a critical accounting policy and estimate, involving the acquisition method to allocate costs to assets acquired and liabilities assumed based on estimated fair values[152](index=152&type=chunk)[153](index=153&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 faces market risks from currency exchange rate fluctuations and interest rate changes, with a **10% USD strengthening** potentially impacting sales by **$12.8 million** and earnings by **$0.8 million** - The company is exposed to currency exchange rate risk, where a hypothetical **10%** strengthening of the U.S. dollar would decrease reported sales by approximately **$12.8 million** (**4.1%**) and net income by **$0.8 million** (**2.2%**) for the quarter[157](index=157&type=chunk) - The company is exposed to interest rate risk, primarily on its **$265.7 million** of variable rate borrowings, where a **100 basis point** change in interest rates could impact future earnings[161](index=161&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2021, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2021[163](index=163&type=chunk) PART II. OTHER INFORMATION [Item 1A. Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) This section details key business risks, particularly the material adverse effects from product liability claims and recalls, specifically highlighting the self-insured cumulative trauma claims against MSA LLC - The company faces inherent business risk from product liability claims, defects, or recalls, which could materially harm business, operating results, and financial condition[164](index=164&type=chunk) - Subsidiary MSA LLC faces significant risk from cumulative trauma product liability claims (**3,043 claims** as of March 31, 2021), and as MSA LLC is now largely self-insured, losses could exceed established reserves and materially impact financial results[165](index=165&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 details equity security purchases for the quarter, noting all shares were related to stock compensation transactions, not the publicly announced share repurchase program Issuer Purchases of Equity Securities (Q1 2021) | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | January 2021 | 234 | $156.12 | | February 2021 | 900 | $166.10 | | March 2021 | 31,516 | $163.80 | - Shares purchased during the quarter were related to stock compensation transactions, and no shares were repurchased under the publicly announced **$100.0 million** share repurchase program[168](index=168&type=chunk)[169](index=169&type=chunk) [Item 6. Exhibits](index=36&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files - The exhibits filed with this report include CEO/CFO certifications (31.1, 31.2, 32) and XBRL interactive data files (101 series)[170](index=170&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 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 No. 1-15579 MSA SAFETY INCORPORATED (Exact name of registrant as specified in its charter) Pennsylvania 46-4914539 (State or other jurisd ...

Financial Data and Key Metrics Changes - The company reported record high revenue of $388 million in Q4 2020, representing a growth of over 3% year-over-year or 2% in constant currency [8][23] - For the full year, revenue declined by 3% [9] - Adjusted operating margin reached 18%, up 10 basis points from the previous year [9][21] - Operating cash flow for 2020 was over $200 million, a 25% increase from the prior year [21][22] - Gross profit declined by 350 basis points due to higher costs, including $11 million related to lower throughput and inventory charges [28][29] Business Line Data and Key Metrics Changes - The fire service market saw a 10% increase in Q4 2020, driven by strong growth in self-contained breathing apparatus (SCBA) [19][23] - Industrial PPE products declined by 4% year-over-year, following a 25% decline in Q3 [25] - Revenue from air purifying respirators increased by 32% year-over-year, largely fulfilling backlog from the pandemic surge [26] Market Data and Key Metrics Changes - Revenue in the Americas segment increased by 5%, while the International segment saw a 2% decrease in constant currency [23] - The backlog for fire service products was significantly up entering Q4, with a healthy book-to-bill ratio maintained [23][54] Company Strategy and Development Direction - The company is focused on three key areas: strengthening its innovation engine, fostering a continuous improvement culture, and making strategic acquisitions [10][20] - The acquisition of Bristol Uniforms enhances the company's position in the fire service PPE market [18][19] - The company aims to improve operating margins to the 20% range over the coming years [9][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong performance in the fire service and a commitment to innovation [9][10] - The company is cautious about the first half of 2021 due to challenging comparisons but expects stronger performance in the second half [41][42] - External factors such as vaccine rollout and economic recovery will significantly influence revenue growth in 2021 [39][41] Other Important Information - The company invested nearly $70 million in R&D in 2020 [12] - A pre-tax charge of $34 million was recorded for product liability reserves [35] - The company plans to deliver approximately $15 million in savings across the income statement in 2021 [31] Q&A Session Summary Question: Comments on International margin improvement and future targets - Management indicated confidence in achieving the long-term goal of improving operating margin by 500 basis points since 2017, with expectations for further improvements [47][86] Question: Backlog strength and its implications - Management confirmed that the fire service product backlog was significantly up, with expectations for continued strength in 2021 [53][54] Question: Supply chain concerns regarding technological products - Management acknowledged tight supply chains for certain components but stated that production has not been hampered [51] Question: Insights on energy markets and potential recovery - Management noted signs of life in energy markets, particularly in the Middle East, with expectations for increased demand as oil prices rise [65][66] Question: Impact of rising raw materials on 2021 outlook - Management is monitoring raw material costs closely but has not seen significant impacts yet [74][75] Question: Expectations for operating expenses in 2021 - Management indicated that while some costs will return, they expect to offset these with savings from restructuring efforts [60][61]