Core Insights - MSA Safety Incorporated has appointed Julie A. Beck as Senior Vice President, Chief Financial Officer, and Treasurer, effective August 18, 2025 [1] - Julie Beck has extensive experience in financial leadership, having previously served as CFO at Terex Corp. and Nova Chemicals, and brings expertise in M&A, inflation management, and business transformation [2][3] Company Overview - MSA Safety is a global leader in advanced safety products and solutions, with 2024 revenues of $1.8 billion and over 5,000 employees across more than 40 international locations [6] - The company has been focused on safety innovation since 1914, serving diverse end markets and creating sustainable value for shareholders [6] Leadership Transition - Julie Beck succeeds interim CFO Elyse Brody, who will return to her role as Executive Director, Global FP&A and Strategy [4] - Beck's leadership style emphasizes high ethical standards, personal responsibility, and a commitment to continuous improvement [4][5] Previous Experience - At Terex Corp., Beck directed financial strategies that mitigated inflation impacts and improved sales growth, EPS, and cash flow [2] - Prior to Terex, she held significant roles at Nova Chemicals and Joy Global, contributing to financial and operational excellence [3]

[Cover Page](index=1&type=section&id=Cover%20Page) This document is a Quarterly Report (Form 10-Q) for MSA SAFETY INCORPORATED, detailing key filing information and share data - The document is a Quarterly Report (Form 10-Q) for the quarter ended June 30, 2025, filed by MSA SAFETY INCORPORATED[2](index=2&type=chunk) Filer Status and Shares Outstanding | Metric | Value | | :--- | :--- | | Filer Status | Large Accelerated Filer | | Common Stock Trading Symbol | MSA | | Shares Outstanding (as of July 25, 2025) | 39,143,220 | [Table of Contents](index=2&type=section&id=Table%20of%20Contents) [PART I. FINANCIAL INFORMATION](index=3&type=section&id=Part%20I%20Financial%20Information) [Item 1. Financial Statements](index=3&type=section&id=Item%201%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including statements of income, comprehensive income, balance sheets, cash flows, and changes in equity, along with detailed notes explaining accounting policies, segment information, debt, acquisitions, and contingencies for the periods ended June 30, 2025, and December 31, 2024 [Condensed Consolidated Statements of Income (unaudited)](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(unaudited)) Three Months Ended June 30 (in thousands, except per share values) | Metric | 2025 | 2024 | YoY Change | | :-------------------------------- | :------- | :------- | :--------- | | Net sales | $474,116 | $462,463 | +2.5% | | Gross profit | $220,710 | $223,029 | -1.0% | | Operating income | $85,862 | $99,944 | -14.2% | | Net income | $62,773 | $72,234 | -13.0% | | Basic EPS | $1.60 | $1.83 | -12.5% | | Diluted EPS | $1.59 | $1.83 | -13.0% | | Dividends per common share | $0.53 | $0.51 | +3.9% | Six Months Ended June 30 (in thousands, except per share values) | Metric | 2025 | 2024 | YoY Change | | :-------------------------------- | :------- | :------- | :--------- | | Net sales | $895,456 | $875,765 | +2.2% | | Gross profit | $414,105 | $418,560 | -1.1% | | Operating income | $163,623 | $180,056 | -9.1% | | Net income | $122,378 | $130,373 | -6.1% | | Basic EPS | $3.11 | $3.31 | -6.0% | | Diluted EPS | $3.10 | $3.30 | -6.1% | | Dividends per common share | $1.04 | $0.98 | +6.1% | [Condensed Consolidated Statements of Comprehensive Income (unaudited)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(unaudited)) Three Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | YoY Change | | :-------------------------------- | :------- | :------- | :--------- | | Net income | $62,773 | $72,234 | -13.0% | | Foreign currency translation adjustments | $44,143 | $(8,822) | Significant positive swing | | Total other comprehensive gain (loss), net of tax | $44,385 | $(8,000) | Significant positive swing | | Comprehensive income | $107,158 | $64,234 | +66.8% | Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | YoY Change | | :-------------------------------- | :------- | :------- | :--------- | | Net income | $122,378 | $130,373 | -6.1% | | Foreign currency translation adjustments | $66,680 | $(19,495) | Significant positive swing | | Total other comprehensive gain (loss), net of tax | $67,123 | $(18,299) | Significant positive swing | | Comprehensive income | $189,501 | $112,074 | +69.1% | [Condensed Consolidated Balance Sheets (unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(unaudited)) Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change | | :-------------------------------- | :-------------- | :---------------- | :------- | | Total current assets | $887,461 | $803,030 | +10.5% | | Total assets | $2,550,211 | $2,205,784 | +15.6% | | Total current liabilities | $285,464 | $288,093 | -0.9% | | Long-term debt, net | $670,965 | $481,622 | +39.3% | | Total liabilities | $1,297,569 | $1,062,465 | +22.1% | | Total shareholders' equity | $1,252,642 | $1,143,319 | +9.6% | - Goodwill increased by **$112.35 million** and Intangible assets, net, increased by **$64.497 million** from December 31, 2024, to June 30, 2025, primarily due to the M&C acquisition[14](index=14&type=chunk)[79](index=79&type=chunk)[81](index=81&type=chunk) [Condensed Consolidated Statements of Cash Flows (unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(unaudited)) Cash Flow Highlights (Six Months Ended June 30, in thousands) | Activity | 2025 | 2024 | YoY Change | | :-------------------------------- | :----------- | :----------- | :----------- | | Cash Flow From Operating Activities | $129,051 | $104,188 | +23.9% | | Cash Flow Used in Investing Activities | $(227,873) | $(25,486) | +794.1% (higher outflow) | | Cash Flow From (Used in) Financing Activities | $73,979 | $(67,718) | Significant positive swing | | Change in cash, cash equivalents and restricted cash | $(17,151) | $427 | Shift to net decrease | - Acquisitions, net of cash acquired, used **$187.774 million** in cash in 2025, compared to none in 2024[16](index=16&type=chunk) - Net proceeds from long-term debt were **$165.220 million** in 2025, compared to net payments of **$13.260 million** in 2024, primarily to fund the M&C acquisition[16](index=16&type=chunk)[78](index=78&type=chunk) [Condensed Consolidated Statements of Changes in Retained Earnings and Accumulated Other Comprehensive Loss (unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Retained%20Earnings%20and%20Accumulated%20Other%20Comprehensive%20Loss%20(unaudited)) Retained Earnings (in thousands) | Period | Balance at Beginning | Net Income | Common Dividends | Preferred Dividends | Balance at End | | :-------------------------------- | :------------------- | :--------- | :--------------- | :---------------- | :------------- | | Six Months Ended June 30, 2025 | $1,349,650 | $122,378 | $(40,861) | $(20) | $1,431,147 | | Six Months Ended June 30, 2024 | $1,143,442 | $130,373 | $(38,569) | $(20) | $1,235,226 | Accumulated Other Comprehensive Loss (in thousands) | Period | Balance at Beginning | Foreign Currency Translation Adjustments | Pension & Post-retirement Adjustments | Reclassification | Balance at End | | :-------------------------------- | :------------------- | :--------------------------------------- | :------------------------------------ | :--------------- | :------------- | | Six Months Ended June 30, 2025 | $(141,649) | $66,680 | $443 | — | $(74,526) | | Six Months Ended June 30, 2024 | $(129,249) | $(19,495) | $2,396 | $(1,200) | $(147,548) | [Note 1—Basis of Presentation](index=8&type=section&id=Note%201%E2%80%94Basis%20of%20Presentation) - The unaudited condensed consolidated financial statements include normal recurring adjustments and should be read in conjunction with the 2024 Form 10-K[20](index=20&type=chunk) - ASU 2023-09 (Improvements to Income Tax Disclosures) and ASU 2024-03 (Disaggregation of Income Statement Expenses) are not expected to have a material effect on the consolidated financial statements, except for expanding disclosures[21](index=21&type=chunk)[22](index=22&type=chunk) [Note 2—Revenue Recognition](index=8&type=section&id=Note%202%E2%80%94Revenue%20Recognition) - Revenue is primarily generated from manufacturing and selling safety products and solutions, recognized when control passes to the customer (generally upon shipment or delivery)[23](index=23&type=chunk)[24](index=24&type=chunk) - Managed fire service contracts are accounted for as sales-type leases; equipment revenue is recognized at lease commencement, while maintenance and interest are recognized monthly over the lease term[30](index=30&type=chunk)[31](index=31&type=chunk) - Remaining maintenance performance obligations for managed fire service contracts totaled **$34.4 million** as of June 30, 2025, expected to be recognized over approximately 3 years[31](index=31&type=chunk) [Note 3—Cash and Cash Equivalents](index=10&type=section&id=Note%203%E2%80%94Cash%20and%20Cash%20Equivalents) - The company utilizes a notional cash pooling arrangement to manage global liquidity requirements, combining cash balances to offset bank overdrafts[35](index=35&type=chunk) Net Cash Pool Position (June 30, 2025, in thousands) | Metric | Amount | | :-------------------- | :------- | | Gross cash pool position | $52,967 | | Less: cash pool borrowings | $(51,964) | | Net cash pool position | $1,003 | [Note 4—Restructuring Charges](index=10&type=section&id=Note%204%E2%80%94Restructuring%20Charges) Restructuring Charges (in millions) | Period | 2025 | 2024 | | :-------------------------------- | :--- | :--- | | Three Months Ended June 30 | $0.5 | $1.5 | | Six Months Ended June 30 | $2.4 | $4.6 | - Restructuring charges in 2025 were primarily related to initiatives to right-size the organization in response to macroeconomic conditions and to optimize the manufacturing footprint[37](index=37&type=chunk) Restructuring Reserve Balances (in millions) | Date | Balance | | :-------------------- | :------ | | December 31, 2024 | $3.4 | | June 30, 2025 | $3.6 | [Note 5—Inventories](index=11&type=section&id=Note%205%E2%80%94Inventories) Inventory Components (in thousands) | Component | June 30, 2025 | December 31, 2024 | | :-------------------- | :-------------- | :---------------- | | Finished products | $105,940 | $93,356 | | Work in process | $19,511 | $13,413 | | Raw materials and supplies | $218,432 | $190,027 | | Total inventories | $343,883 | $296,796 | [Note 6—Property, Plant and Equipment](index=11&type=section&id=Note%206%E2%80%94Property,%20Plant%20and%20Equipment) Property, Plant and Equipment, Net (in thousands) | Component | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Land | $9,579 | $4,235 | | Buildings | $198,730 | $142,605 | | Machinery and equipment | $544,266 | $512,894 | | Construction in progress | $31,913 | $25,451 | | Total (gross) | $784,488 | $685,185 | | Less: accumulated depreciation | $(505,069) | $(473,320) | | Property, plant and equipment, net | $279,419 | $211,865 | [Note 7—Reclassifications Out of Accumulated Other Comprehensive Loss](index=11&type=section&id=Note%207%E2%80%94Reclassifications%20Out%20of%20Accumulated%20Other%20Comprehensive%20Loss) - Accumulated other comprehensive loss decreased from **$(141,649) thousand** at December 31, 2024, to **$(74,526) thousand** at June 30, 2025[19](index=19&type=chunk) - Foreign currency translation adjustments resulted in a gain of **$66,680 thousand** for the six months ended June 30, 2025, a significant positive swing compared to a loss of **$(19,495) thousand** in the prior year[42](index=42&type=chunk) - Pension and post-retirement plan adjustments resulted in a gain of **$443 thousand** for the six months ended June 30, 2025[42](index=42&type=chunk) [Note 8—Capital Stock](index=12&type=section&id=Note%208%E2%80%94Capital%20Stock) - The company's 2024 stock repurchase program authorizes up to **$200.0 million** for common stock repurchases[45](index=45&type=chunk) - 248,768 shares were repurchased during the six months ended June 30, 2025, compared to 52,561 shares in the same period of 2024[45](index=45&type=chunk) Common Stock and Treasury Cost Activity (Six Months Ended June 30, in thousands) | Metric | 2025 (Common Stock) | 2025 (Treasury Cost) | 2024 (Common Stock) | 2024 (Treasury Cost) | | :-------------------------------- | :------------------ | :------------------- | :------------------ | :------------------- | | Balance at beginning of period | $329,953 | $(396,604) | $312,324 | $(361,684) | | Share repurchase program | — | $(39,995) | — | $(10,000) | | Balance at end of period | $336,175 | $(442,123) | $320,556 | $(376,556) | [Note 9—Segment Information](index=13&type=section&id=Note%209%E2%80%94Segment%20Information) - The company is organized into three reportable segments: Americas, International, and Corporate, based on geographical operating segments[48](index=48&type=chunk)[49](index=49&type=chunk) Six Months Ended June 30, 2025 - Segment Net Sales (in thousands) | Segment | Net Sales | | :------------ | :---------- | | Americas | $613,299 | | International | $282,157 | | Consolidated | $895,456 | Six Months Ended June 30, 2025 - Sales by Product Group (Consolidated, in thousands) | Product Group | Dollars | Percent | | :-------------------- | :-------- | :------ | | Detection | $354,906 | 40% | | Fire Service | $313,922 | 35% | | Industrial PPE and Other | $226,628 | 25% | | Total | $895,456 | 100% | [Note 10—Earnings per Share](index=18&type=section&id=Note%2010%E2%80%94Earnings%20per%20Share) Earnings Per Share (Six Months Ended June 30) | Metric | 2025 | 2024 | YoY Change | | :-------------------------------- | :----- | :----- | :--------- | | Basic EPS | $3.11 | $3.31 | -6.0% | | Diluted EPS | $3.10 | $3.30 | -6.1% | Earnings Per Share (Three Months Ended June 30) | Metric | 2025 | 2024 | YoY Change | | :-------------------------------- | :----- | :----- | :--------- | | Basic EPS | $1.60 | $1.83 | -12.6% | | Diluted EPS | $1.59 | $1.83 | -13.1% | [Note 11—Income Taxes](index=18&type=section&id=Note%2011%E2%80%94Income%20Taxes) - The effective tax rate for the three months ended June 30, 2025, was **24.1%** (2024: **23.5%**), and for the six months ended June 30, 2025, was **23.8%** (2024: **23.3%**)[59](index=59&type=chunk)[60](index=60&type=chunk) - Differences from the U.S. federal statutory rate are primarily due to state income taxes and nondeductible executive compensation[59](index=59&type=chunk)[60](index=60&type=chunk) - The gross liability for unrecognized tax benefits was **$4.7 million** at June 30, 2025, with **$1.5 million** in recognized tax benefits[61](index=61&type=chunk) [Note 12—Stock Plans](index=19&type=section&id=Note%2012%E2%80%94Stock%20Plans) Stock Compensation Expense (in thousands) | Period | 2025 | 2024 | | :-------------------------------- | :------- | :------- | | Three Months Ended June 30 | $5,370 | $5,042 | | Six Months Ended June 30 | $7,999 | $9,229 | - Unvested restricted stock awards and units totaled 188,641 shares at June 30, 2025, with a weighted average grant date fair value of $155.11[66](index=66&type=chunk) - Unvested performance stock units totaled 144,537 shares at June 30, 2025, with a weighted average grant date fair value of $151.73. The 2022 performance unit awards vested at **220%** of the target award in Q1 2025[68](index=68&type=chunk) [Note 13—Long-Term Debt](index=20&type=section&id=Note%2013%E2%80%94Long-Term%20Debt) Long-Term Debt (in thousands) | Debt Type | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Total | $679,348 | $508,013 | | Amounts due within one year | $8,383 | $26,391 | | Long-term debt, net | $670,965 | $481,622 | - The company entered into a Fifth Amended and Restated Credit Agreement (Revolving Credit Facility) with a capacity of **$1.3 billion** on April 1, 2025, with **$915.4 million** unused at June 30, 2025[69](index=69&type=chunk) - The acquisition of M&C on May 6, 2025, was financed by **$137.3 million** under the Revolving Credit Facility and cash on hand[78](index=78&type=chunk) [Note 14—Goodwill and Intangible Assets, Net](index=21&type=section&id=Note%2014%E2%80%94Goodwill%20and%20Intangible%20Assets,%20Net) - Goodwill increased by **$112.35 million** from January 1, 2025, to June 30, 2025, primarily due to **$91.005 million** from the M&C acquisition and **$21.345 million** from currency translation[79](index=79&type=chunk) - Intangible assets, net, increased by **$64.497 million**, with **$66.568 million** from additions (M&C acquisition) and **$7.535 million** from currency translation, offset by **$9.606 million** in amortization[81](index=81&type=chunk) - Goodwill of **$91.0 million** related to the M&C acquisition was allocated **$63.7 million** to the International segment and **$27.3 million** to the Americas segment[86](index=86&type=chunk) [Note 15—Acquisitions](index=22&type=section&id=Note%2015%E2%80%94Acquisitions) - On May 6, 2025, the company acquired M&C TechGroup Germany GmbH for approximately **$188 million**, net of cash acquired, to enhance its gas analysis systems portfolio[82](index=82&type=chunk)[83](index=83&type=chunk) - The acquisition resulted in preliminary fair values of **$66.6 million** for customer relationships and other intangible assets, and **$91.0 million** for goodwill[84](index=84&type=chunk) - M&C contributed **$10.8 million** in sales and a net loss of **$4.8 million** to the company's results for the three and six months ended June 30, 2025[88](index=88&type=chunk) [Note 16—Pensions and Other Post-retirement Benefits](index=24&type=section&id=Note%2016%E2%80%94Pensions%20and%20Other%20Post-retirement%20Benefits) Net Periodic Benefit (Income) Cost (Six Months Ended June 30, in thousands) | Benefit Type | 2025 | 2024 | | :-------------------------------- | :------- | :------- | | Pension Benefits | $(6,917) | $(3,108) | | Other Benefits | $940 | $722 | - The company made **$3.7 million** in pension contributions during the six months ended June 30, 2025, and expects to contribute between **$6 million** and **$8 million** in 2025[92](index=92&type=chunk) [Note 17—Derivative Financial Instruments](index=24&type=section&id=Note%2017%E2%80%94Derivative%20Financial%20Instruments) - The company uses foreign currency forward contracts to manage currency exchange rate risk, with a notional amount of **$107.8 million** at June 30, 2025[93](index=93&type=chunk) - Foreign exchange contracts resulted in a gain of **$(4.432) million** for the six months ended June 30, 2025, compared to a loss of **$3.659 million** in 2024[95](index=95&type=chunk) [Note 18—Fair Value Measurements](index=25&type=section&id=Note%2018%E2%80%94Fair%20Value%20Measurements) - Derivative financial instruments, consisting of foreign currency forward contracts, are classified within Level 2 of the fair value hierarchy[96](index=96&type=chunk) Fixed Rate Long-Term Debt (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :-------------- | :---------------- | | Carrying amount | $300,300 | $303,500 | | Fair value | $269,800 | $266,400 | [Note 19—Commitments and Contingencies](index=25&type=section&id=Note%2019%E2%80%94Commitments%20and%20Contingencies) - The company faces inherent product liability risks, including single incident and cumulative trauma claims[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) - Globe, a subsidiary, is defending 835 lawsuits comprising 10,808 claims related to PFAS in firefighter turnout gear[103](index=103&type=chunk)[104](index=104&type=chunk) Warranty Reserve (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :-------------- | :---------------- | | Beginning warranty reserve | $13,724 | $14,288 | | Ending warranty reserve | $12,791 | $13,724 | | Warranty expense (six months) | $6,500 | $5,000 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, including a business overview, detailed analysis of quarterly and year-to-date performance, liquidity, capital resources, and critical accounting policies. It highlights the impact of the M&C acquisition, macroeconomic factors, and currency fluctuations on financial results [BUSINESS OVERVIEW](index=27&type=section&id=BUSINESS%20OVERVIEW) - MSA Safety Incorporated is a global leader in advanced safety products, technology, and solutions, with principal product categories in fire service, detection, and industrial personal protective equipment (PPE)[109](index=109&type=chunk) - The company operates through three reportable segments: Americas, International, and Corporate[111](index=111&type=chunk) - On May 6, 2025, MSA acquired M&C TechGroup, a provider of gas analysis systems, for approximately **$188 million**, net of cash acquired[115](index=115&type=chunk) [RESULTS OF OPERATIONS](index=28&type=section&id=RESULTS%20OF%20OPERATIONS) [Three Months Ended June 30, 2025, Compared to Three Months Ended June 30, 2024](index=28&type=section&id=Three%20Months%20Ended%20June%2030,%202025,%20Compared%20to%20Three%20Months%20Ended%20June%2030,%202024) Consolidated Net Sales (Three Months Ended June 30, in millions) | Metric | 2025 | 2024 | Increase | Percent Increase | | :--------- | :--- | :--- | :------- | :--------------- | | Net Sales | $474.1 | $462.5 | $11.6 | 2.5% | - Organic sales decreased by **0.2%** consolidated, with Americas up **1.6%** (driven by detection growth) and International down **4.1%** (due to declines in fire service, detection, and industrial PPE)[117](index=117&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk) - Gross profit margin decreased to **46.6%** from **48.2%**, primarily due to inflation, transactional foreign currency headwinds, and lower organic volumes, partially offset by price realization[122](index=122&type=chunk) - GAAP operating income decreased to **$85.9 million** from **$99.9 million**, mainly due to increased SG&A (M&C acquisition and transaction costs), higher currency exchange losses, and lower gross profit[130](index=130&type=chunk) [Six Months Ended June 30, 2025, Compared to Six Months Ended June 30, 2024](index=32&type=section&id=Six%20Months%20Ended%20June%2030,%202025,%20Compared%20to%20Six%20Months%20Ended%20June%2030,%202024) Consolidated Net Sales (Six Months Ended June 30, in millions) | Metric | 2025 | 2024 | Increase | Percent Increase | | :--------- | :--- | :--- | :------- | :--------------- | | Net Sales | $895.5 | $875.8 | $19.7 | 2.2% | - Organic sales increased by **1.7%** consolidated, with Americas up **1.3%** (detection and industrial PPE growth) and International up **2.5%** (detection and fire service growth)[143](index=143&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk) - Gross profit margin decreased to **46.2%** from **47.8%**, primarily due to inflation, transactional foreign currency headwinds, and lower organic volumes, partially offset by price realization[147](index=147&type=chunk) - GAAP operating income decreased to **$163.6 million** from **$180.1 million**, driven by lower gross profit, increased SG&A expenses, and higher currency exchange losses[156](index=156&type=chunk) [Non-GAAP Financial Measures](index=35&type=section&id=Non-GAAP%20Financial%20Measures) - The company uses non-GAAP financial measures such as organic sales/SG&A change, adjusted operating income/margin, and adjusted EBITDA/margin to provide a better understanding of underlying business performance and trends[167](index=167&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk) - These non-GAAP measures are supplemental and not a substitute for GAAP results[170](index=170&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=36&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) - Primary liquidity sources are operating cash flows and borrowings, with principal requirements for working capital, capital expenditures, debt payments, dividends, and share repurchases[171](index=171&type=chunk) - Cash and cash equivalents totaled **$147.0 million** at June 30, 2025, with **$915.4 million** unused capacity on the **$1.3 billion** revolving credit facility[172](index=172&type=chunk)[173](index=173&type=chunk) - Operating activities provided **$129.1 million** in cash (2025), investing activities used **$227.9 million** (primarily due to the M&C acquisition and capital expenditures), and financing activities provided **$74.0 million** (driven by net debt proceeds and increased share repurchases) for the six months ended June 30, 2025[175](index=175&type=chunk)[176](index=176&type=chunk)[177](index=177&type=chunk) [CUMULATIVE TRANSLATION ADJUSTMENTS](index=37&type=section&id=CUMULATIVE%20TRANSLATION%20ADJUSTMENTS) - A translation gain of **$66.7 million** was recorded to cumulative translation adjustments for the six months ended June 30, 2025, compared to a **$19.5 million** loss in the same period of 2024, due to the U.S. dollar's position relative to international currencies[179](index=179&type=chunk) [COMMITMENTS AND CONTINGENCIES](index=37&type=section&id=COMMITMENTS%20AND%20CONTINGENCIES) - The company expects to make net contributions of **$6.0 million** to **$8.0 million** to its pension plans in 2025[180](index=180&type=chunk) - Outstanding bank guarantees and standby letters of credit totaled **$10.3 million** as of June 30, 2025[181](index=181&type=chunk) [CRITICAL ACCOUNTING POLICIES AND ESTIMATES](index=37&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) - Business combinations have been identified as a critical accounting policy and estimate due to the recent M&C acquisition, requiring significant judgment in valuing acquired assets and liabilities[184](index=184&type=chunk)[185](index=185&type=chunk) [RECENTLY ADOPTED AND RECENTLY ISSUED ACCOUNTING STANDARDS](index=37&type=section&id=RECENTLY%20ADOPTED%20AND%20RECENTLY%20ISSUED%20ACCOUNTING%20STANDARDS) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to market risks, specifically currency exchange rates and interest rates, and outlines the potential financial impact of hypothetical changes in these rates on sales, net income, and the fair value of financial instruments - A hypothetical **10%** strengthening or weakening of the U.S. dollar would decrease or increase reported sales by approximately **$19.9 million** (**4.2%**) and net income by **$1.6 million** (**2.5%**) for the three months ended June 30, 2025[189](index=189&type=chunk) - The notional amount of open foreign currency forward contracts was **$107.8 million** at June 30, 2025, with a hypothetical **10%** strengthening or weakening of the U.S. dollar resulting in a **$10.8 million** change in their fair value[190](index=190&type=chunk) - A 100 basis point increase or decrease in interest rates would have a **$3.2 million** impact on future annual earnings, given **$383.1 million** of variable rate borrowings at June 30, 2025[193](index=193&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures as of June 30, 2025, and reports that there were no material changes in internal control over financial reporting during the most recent fiscal quarter - The company's disclosure controls and procedures were effective as of June 30, 2025[195](index=195&type=chunk) - There were no material changes in the company's internal control over financial reporting during the most recent fiscal quarter[195](index=195&type=chunk) [PART II. OTHER INFORMATION](index=39&type=section&id=Part%20II%20Other%20Information) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=Item%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports on the company's share repurchase activities under its **$200.0 million** program, detailing the number of shares purchased and the remaining authorization for the quarter ended June 30, 2025 Issuer Purchases of Equity Securities (Quarter Ended June 30, 2025) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased As Part of Publicly Announced Plans or Programs | Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs | | :--------- | :------------------------------- | :--------------------------- | :----------------------------------------------------------------------------- | :----------------------------------------------------------------------------- | | April 2025 | 657 | $157.28 | — | 1,016,845 | | May 2025 | 158,220 | $160.09 | 157,777 | 827,216 | | June 2025 | 31,075 | $164.10 | 28,866 | 776,419 | - During the quarter ended June 30, 2025, 186,643 shares were repurchased for **$30.0 million** under the **$200.0 million** share repurchase program[196](index=196&type=chunk) [Item 5. Other Information](index=39&type=section&id=Item%205%20Other%20Information) This section states that no Rule 10b5-1 trading arrangements were adopted or terminated by the company, its directors, or officers during the three months ended June 30, 2025 - No Rule 10b5-1 trading arrangements were adopted or terminated by any director, officer, or the company itself during the three months ended June 30, 2025[198](index=198&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206%20Exhibits) This section lists all documents filed as exhibits to the Form 10-Q, including credit agreements, certifications from the CEO and CFO, and XBRL data files - Exhibits include the Fifth Amended and Restated Credit Agreement, Amendment No. 4 to the Third Amended and Restated Multicurrency Note Purchase and Private Shelf Agreement, Amendment No. 4 to the Second Amended and Restated Master Note Facility, CEO and CFO certifications, and XBRL documents[199](index=199&type=chunk)[201](index=201&type=chunk) [SIGNATURE](index=41&type=section&id=SIGNATURE) This section contains the required signatures from the company's Interim Chief Financial Officer and Chief Accounting Officer, certifying the accuracy and completeness of the report - The report is signed by Elyse L. Brody, Interim Chief Financial Officer, and Jonathan D. Buck, Chief Accounting Officer and Controller, on August 5, 2025[205](index=205&type=chunk)

Group 1 - MSA Safety Incorporated held its Second Quarter 2025 Earnings Conference Call on August 5, 2025, to discuss financial results and provide an outlook for the full year 2025 [2][3] - The call featured key participants including the President and CEO, Interim CFO, and the Executive Director of Investor Relations, indicating a comprehensive leadership presence [3] Group 2 - The company plans to discuss its second quarter financial results during the call, highlighting its performance and strategic direction [3] - The call is expected to include forward-looking statements regarding anticipated levels of future performance, which are subject to various risks and uncertainties [4]

Financial Data and Key Metrics Changes - Consolidated reported sales growth was 3% or flat organic, with adjusted earnings per share at $1.93, exceeding original expectations [5][6] - Gross margins were pressured at 46.6%, down 170 basis points year over year, primarily due to foreign currency headwinds and inflation [19][20] - GAAP operating margin was 18.1%, with adjusted operating margin at 21.4%, down 200 basis points from the previous year [20] Business Line Data and Key Metrics Changes - Detection experienced mid single-digit organic growth driven by fixed and portable gas detection, growing 6% organically [8][10] - Fire Service organic sales declined mid single digits year over year, impacted by market dynamics surrounding NFPA standard changes [8][9] - Industrial PPE organic sales were down low single digits, with growth in fall protection offsetting declines in head protection and ballistic helmets [10][21] Market Data and Key Metrics Changes - In the Americas segment, sales increased 2% year over year, with double-digit growth in detection offset by declines in fire service and industrial PPE [21] - The International segment saw a 4% increase in sales on a reported basis, but a 4% decline on an organic basis due to lower volumes in fire service and detection [22] Company Strategy and Development Direction - The company continues to focus on its Accelerate strategy, emphasizing long-term value creation through organic growth, M&A, and cash returns to shareholders [10][13] - The acquisition of M and C Tech Group is expected to enhance fixed gas offerings and expand the total addressable market by $500 million [15][16] - The company is committed to investing in R&D to support new product development, with a focus on industrial safety technology [14][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business and its ability to navigate macro uncertainties, maintaining a low single-digit full-year organic growth outlook [25][26] - The timing of NFPA approval and AFG funding release will significantly impact fire service execution in the second half [26][60] - Management expects interest expense to be approximately $29 million to $32 million, including the acquisition [27] Other Important Information - Free cash flow was $38 million, representing 60% of earnings, with quarterly operating cash flow increasing more than 25% from the previous year [22][23] - The company returned over $50 million to shareholders through stock repurchases and dividends, marking the 55th consecutive year of increased annual dividends [17][24] Q&A Session Summary Question: Can you break out and quantify the growth between fixed gas, non-connected portables, and connected portables in the quarter? - Management indicated strong performance in detection, particularly in fixed gas and MSA Plus connected portables, with most growth coming from MSA Plus [32][36] Question: How have customers responded to pricing actions and what was the magnitude of those actions? - Management noted that pricing actions were taken to mitigate inflation and tariff impacts, with customers generally accepting these increases [45][48] Question: What percentage of the current pipeline consists of customers committed to purchasing before the new standard? - Management refrained from disclosing specific percentages but indicated a solid pipeline and readiness for both current and future customer needs [50][52] Question: What is the timing and disbursement of AFG funding? - Management confirmed that AFG funding is approved and expected to begin releasing in August [58] Question: How does the company view fourth-quarter seasonality? - Management expects the fourth quarter to remain strong, consistent with historical performance [60] Question: What elements of timing are being monitored around the new NFPA standard? - Management highlighted key milestones in the government approval process, with expectations for approval between now and early 2026 [74][78] Question: Is M and C Tech Group accretive to margins? - Management stated that M and C's margins are similar to MSA's overall margins, thus neutral on margins but accretive to EPS [86]

Financial Data and Key Metrics Changes - Consolidated reported sales growth was 3% or flat organic, with adjusted earnings per share at $1.93, exceeding original expectations [5][20] - Gross margins were pressured at 46.6%, down 170 basis points year over year, primarily due to foreign currency headwinds and inflation [21][22] - GAAP operating margin was 18.1%, with adjusted operating margin at 21.4%, down 200 basis points from the previous year [22] Business Line Data and Key Metrics Changes - Detection experienced mid single-digit organic growth, driven by fixed and portable gas detection, growing 6% organically [8][20] - Fire Service organic sales declined mid single digits year over year, impacted by market dynamics surrounding NFPA standard changes [8][9] - Industrial PPE organic sales were down low single digits, with growth in fall protection offsetting declines in head protection and ballistic helmets [11][23] Market Data and Key Metrics Changes - Americas segment sales increased 2% year over year, with double-digit growth in detection offset by declines in fire service and industrial PPE [23] - International segment sales increased 4% year over year on a reported basis, but decreased 4% on an organic basis due to declines in fire service and industrial PPE [24] Company Strategy and Development Direction - The company continues to focus on its Accelerate strategy, emphasizing organic growth, M&A, and cash returns to shareholders [12][14] - Investments in R&D and operational capabilities are aimed at achieving profitable organic growth and enhancing product offerings [15][16] - The acquisition of M and C Tech Group is expected to expand the total addressable market by $500 million and enhance fixed gas offerings [17][18] Management's Comments on Operating Environment and Future Outlook - Management remains confident in the resilience of the business and its ability to navigate macro uncertainties, maintaining a low single-digit full-year organic growth outlook [27][29] - The timing of NFPA approval and AFG funding release will significantly impact fire service execution in the second half [28][64] - The company expects interest expense to be approximately $29 million to $32 million, including the acquisition [30] Other Important Information - Free cash flow was $38 million, representing 60% of earnings, with quarterly operating cash flow increasing more than 25% from the previous year [24][25] - The company returned over $50 million to shareholders through stock repurchases and dividends, marking the 55th consecutive year of increased annual dividends [18][26] Q&A Session Summary Question: Can you break out and quantify the growth between fixed gas, non-connected portables, and connected portables in the quarter? - Management indicated strong performance in fixed gas and MSA Plus connected portables, with most growth in the portable space attributed to MSA Plus [35][38] Question: How have customers responded to pricing actions and what was the magnitude of those actions? - Management noted that pricing actions were taken to mitigate inflation and tariff impacts, with customers generally accepting these increases [48][52] Question: What percentage of the current pipeline consists of customers committed to purchasing before the new standard? - Management refrained from disclosing specific percentages but expressed confidence in being well-prepared for both current and future customer needs [54][56] Question: What is the timing and disbursement of AFG funding? - Management confirmed that AFG funding is approved and expected to begin releasing in August [62] Question: How does the company feel about fourth-quarter seasonality? - Management expects the fourth quarter to remain strong, consistent with historical performance [64] Question: Can you elaborate on the timing of the NFPA standard change? - Management explained that the NFPA standard change involves a government approval process, with testing completion being a key milestone [78][80] Question: Is M and C Tech Group accretive to margins? - Management stated that M and C's margins are relatively similar to MSA's overall margins, thus neutral on margins but accretive to EPS [91][92]

Second Quarter 2025 Earnings Presentation August 5, 2025 Second Quarter 2025 Earnings Presentation 1 Cautionary Statements Regarding Forward-looking Statements This presentation may contain (and verbal statements made by MSA® Safety Incorporated ("MSA Safety") may contain) "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance and involve various assumptions, known and unknown risks ...

Core Insights - MSA Safety reported revenue of $474.12 million for the quarter ended June 2025, reflecting a 2.5% increase year-over-year and a 6.3% surprise over the Zacks Consensus Estimate of $446.01 million [1] - The company's EPS for the quarter was $1.93, down from $2.01 in the same quarter last year, with a positive surprise of 9.66% over the consensus estimate of $1.76 [1] Revenue Performance - Net sales in the Fire Service category reached $163.31 million, exceeding the two-analyst average estimate of $160.68 million [4] - Industrial PPE and Other category net sales were $116.98 million, surpassing the average estimate of $114.28 million [4] - Detection category net sales amounted to $193.84 million, significantly above the two-analyst average estimate of $166.33 million [4] Stock Performance - MSA Safety's shares have returned -0.3% over the past month, while the Zacks S&P 500 composite has increased by 0.6% [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance compared to the broader market in the near term [3]

Core Viewpoint - MSA Safety reported quarterly earnings of $1.93 per share, exceeding the Zacks Consensus Estimate of $1.76 per share, but down from $2.01 per share a year ago, indicating a +9.66% earnings surprise [1] Financial Performance - The company achieved revenues of $474.12 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 6.30% and up from $462.46 million year-over-year [2] - Over the last four quarters, MSA Safety has exceeded consensus EPS estimates four times and topped consensus revenue estimates twice [2] Stock Performance and Outlook - MSA Safety shares have increased approximately 5.7% year-to-date, compared to the S&P 500's gain of 6.1% [3] - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $1.97 for the upcoming quarter and $7.81 for the current fiscal year [7] Industry Context - The Security and Safety Services industry ranks in the top 37% of over 250 Zacks industries, suggesting a favorable environment for MSA Safety's performance [8] - Empirical research indicates a strong correlation between near-term stock movements and earnings estimate revisions, which can be tracked by investors [5]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) This section provides an overview of MSA Safety's Q2 2025 financial performance, strategic activities, and management's outlook [Q2 2025 Performance Highlights](index=1&type=section&id=Q2%202025%20Performance%20Highlights) MSA Safety reported $474 million net sales, 3% GAAP growth, flat organically, with $63 million GAAP net income and key strategic investments Q2 2025 Key Financial Metrics | Metric | Value | | :--- | :--- | | Net Sales | $474 million | | GAAP Sales Growth | 3% | | Organic Sales Growth | Flat YoY | | GAAP Operating Income | $86 million (18.1% margin) | | Adjusted Operating Income | $101 million (21.4% margin) | | GAAP Net Income | $63 million | | GAAP Diluted EPS | $1.59 | | Adjusted Earnings | $76 million | | Adjusted Diluted EPS | $1.93 | - Acquired M&C TechGroup, a manufacturer of gas analysis and process safety technologies, for **$188 million**, net of cash acquired[5](index=5&type=chunk) - Returned capital to shareholders through **$30 million** in common stock repurchases and **$21 million** in dividend payments[5](index=5&type=chunk) - Invested **$29 million** in capital expenditures, which includes a strategic investment to expand manufacturing and engineering capabilities at its detection Center of Excellence[5](index=5&type=chunk)[7](index=7&type=chunk) [Management Commentary & Outlook](index=1&type=section&id=Management%20Commentary%20%26%20Outlook) Management highlighted strong backlog conversion, growth in detection and fall protection, reaffirmed low-single-digit organic sales growth, and noted risks - CEO Steve Blanco emphasized strong backlog conversion and momentum in growth accelerator product categories like detection and fall protection[4](index=4&type=chunk) - The acquisition of M&C TechGroup aims to expand the addressable market, diversify end markets, and create a synergistic growth platform in gas analysis and process safety[4](index=4&type=chunk) - The company reaffirmed its full-year 2025 outlook for low-single-digit organic sales growth[7](index=7&type=chunk)[8](index=8&type=chunk) - Management acknowledged ongoing risks related to tariffs, industrial demand, and the timing of the National Fire Protection Association (NFPA) approval for its new self-contained breathing apparatus (SCBA)[7](index=7&type=chunk)[8](index=8&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) This section details MSA Safety's consolidated and segment-level financial results, including sales by product group for Q2 2025 [Consolidated Financial Results](index=2&type=section&id=Consolidated%20Financial%20Results) Q2 2025 net sales grew 3% to **$474.1 million**, but GAAP operating income and EPS declined, with similar trends for the first six months Q2 2025 vs Q2 2024 Consolidated Results (in millions, except EPS) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $474.1 | $462.5 | 3% | | GAAP Operating Income | $85.9 | $99.9 | (14)% | | GAAP Diluted EPS | $1.59 | $1.83 | (13)% | | Adjusted EBITDA | $116.5 | $121.9 | (4)% | | Adjusted Diluted EPS | $1.93 | $2.01 | (4)% | | Free Cash Flow | $37.9 | $39.0 | (3)% | Six Months 2025 vs Six Months 2024 Consolidated Results (in millions, except EPS) | Metric | H1 2025 | H1 2024 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $895.5 | $875.8 | 2% | | GAAP Operating Income | $163.6 | $180.1 | (9)% | | GAAP Diluted EPS | $3.10 | $3.30 | (6)% | | Adjusted EBITDA | $218.0 | $223.2 | (2)% | | Adjusted Diluted EPS | $3.61 | $3.62 | 0% | | Free Cash Flow | $88.9 | $78.6 | 13% | [Segment Performance](index=2&type=section&id=Segment%20Performance) Americas segment sales grew 2% with a 5% operating income decline, while International sales rose 4% but operating income dropped 46% Q2 2025 Segment Performance (in millions) | Segment | Net Sales | % Change YoY | GAAP Operating Income | % Change YoY | | :--- | :--- | :--- | :--- | :--- | | Americas | $320.1 | 2% | $91.3 | (5)% | | International | $154.0 | 4% | $12.2 | (46)% | - The Americas segment's GAAP operating margin decreased by **210 basis points** to **28.5%** in Q2 2025[6](index=6&type=chunk) - The International segment experienced a significant decline in profitability, with its GAAP operating margin falling from **15.4%** in Q2 2024 to **8.0%** in Q2 2025[6](index=6&type=chunk) [Sales by Product Group](index=7&type=section&id=Sales%20by%20Product%20Group) Detection became the largest product group at 41% of sales, driven by acquisition, while Fire Service declined and Industrial PPE remained stable Q2 2025 Sales Mix vs Q2 2024 (Consolidated) | Product Group | Q2 2025 Sales | Q2 2025 % of Total | Q2 2024 Sales | Q2 2024 % of Total | | :--- | :--- | :--- | :--- | :--- | | Detection | $193.8M | 41% | $170.8M | 37% | | Fire Service | $163.3M | 34% | $172.3M | 37% | | Industrial PPE & Other | $117.0M | 25% | $119.3M | 26% | | **Total** | **$474.1M** | **100%** | **$462.5M** | **100%** | - Detection sales for Q2 2025 include revenue from the newly acquired M&C TechGroup from May 6th, 2025, onward[15](index=15&type=chunk) [Condensed Consolidated Financial Statements](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents MSA Safety's condensed statements of income, balance sheets, and cash flows for the reporting period [Statements of Income](index=4&type=section&id=Statements%20of%20Income) Q2 2025 gross profit slightly decreased, operating income fell to **$85.9 million** due to higher expenses and currency losses, and net income was **$62.8 million** Q2 2025 Income Statement Highlights (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net sales | $474,116 | $462,463 | | Gross profit | $220,710 | $223,029 | | Operating income | $85,862 | $99,944 | | Net income | $62,773 | $72,234 | | Diluted EPS | $1.59 | $1.83 | - Selling, general and administrative expenses increased to **$112.1 million** in Q2 2025 from **$105.1 million** in Q2 2024[11](index=11&type=chunk) - The company recorded a net currency exchange loss of **$5.3 million** in Q2 2025, compared to a gain of **$0.6 million** in Q2 2024[11](index=11&type=chunk) [Balance Sheets](index=5&type=section&id=Balance%20Sheets) Total assets increased to **$2.55 billion** driven by acquisitions, long-term debt rose to **$671.0 million**, and shareholders' equity reached **$1.25 billion** Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total current assets | $887,461 | $803,030 | | Goodwill | $733,245 | $620,895 | | Intangible assets, net | $310,934 | $246,437 | | **Total assets** | **$2,550,211** | **$2,205,784** | | Long-term debt, net | $670,965 | $481,622 | | **Total shareholders' equity** | **$1,252,642** | **$1,143,319** | [Statements of Cash Flows](index=6&type=section&id=Statements%20of%20Cash%20Flows) H1 2025 operating cash flow was **$129.1 million**, investing activities used **$227.9 million** for acquisitions, and financing provided **$74.0 million** from debt, leading to a **$17.2 million** cash decrease Six Months 2025 Cash Flow Summary (in thousands) | Activity | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Cash flow from operating activities | $129,051 | $104,188 | | Cash flow used in investing activities | ($227,873) | ($25,486) | | Cash flow from financing activities | $73,979 | ($67,718) | | **Net change in cash** | **($17,151)** | **$427** | - The primary use of cash in investing activities was **$187.8 million** for acquisitions, net of cash acquired[13](index=13&type=chunk) - Financing activities included a net increase in debt of **$165.2 million**, while the company paid **$40.9 million** in dividends and repurchased **$40.0 million** of its stock in the first half of 2025[13](index=13&type=chunk) [Reconciliation of Non-GAAP Financial Measures](index=8&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section reconciles GAAP to non-GAAP financial measures, including organic sales, adjusted earnings, and leverage ratios [Organic Sales Change](index=8&type=section&id=Organic%20Sales%20Change) Q2 2025 consolidated GAAP sales grew 3%, but organic sales were flat after adjusting for acquisitions and currency, with varied segment and product performance Q2 2025 Consolidated Sales Change Reconciliation | Component | % Change | | :--- | :--- | | GAAP reported sales change | 3% | | Currency translation effects | (1)% | | Less: Acquisitions | (2)% | | **Organic sales change** | **0%** | Q2 2025 Organic Sales Change by Segment & Product | Category | Organic Sales Change | | :--- | :--- | | **Segment** | | | Americas | 2% | | International | (4)% | | **Product Group** | | | Detection | 6% | | Fire Service | (6)% | | Industrial PPE and Other | (1)% | [Adjusted Operating Income, EBITDA, and Earnings](index=10&type=section&id=Adjusted%20Operating%20Income%2C%20EBITDA%2C%20and%20Earnings) Q2 2025 GAAP operating income of **$85.9 million** was adjusted to **$101.4 million**, and GAAP net income of **$62.8 million** to adjusted earnings of **$75.9 million** Q2 2025 Reconciliation of GAAP Operating Income to Adjusted Operating Income (in thousands) | Description | Amount | | :--- | :--- | | **GAAP operating income** | **$85,862** | | Transaction costs | $6,645 | | Currency exchange losses, net | $5,286 | | Acquisition-related amortization | $3,153 | | Restructuring charges | $488 | | **Adjusted operating income** | **$101,434** | Q2 2025 Reconciliation of GAAP Net Income to Adjusted Earnings (in thousands) | Description | Amount | | :--- | :--- | | **Net income (GAAP)** | **$62,773** | | Transaction costs | $6,645 | | Currency exchange losses, net | $5,286 | | Other adjustments (net) | $1,205 | | Income tax expense on adjustments | ($4,021) | | **Adjusted earnings** | **$75,929** | [Debt & Leverage Ratios](index=12&type=section&id=Debt%20%26%20Leverage%20Ratios) As of June 30, 2025, Debt to Adjusted EBITDA was **1.5x** and Net Debt to Adjusted EBITDA was **1.1x**, based on **$679.3 million** total debt Leverage Ratios as of June 30, 2025 | Metric | Value | | :--- | :--- | | Twelve Months Adjusted EBITDA | $464.2 million | | Total end-of-period debt | $679.3 million | | Net debt | $532.4 million | | **Debt to adjusted EBITDA** | **1.5x** | | **Net debt to adjusted EBITDA** | **1.1x** | [Investor Information & Appendix](index=3&type=section&id=Investor%20Information%20%26%20Appendix) This section provides details for the upcoming conference call, company overview, and important legal disclaimers [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) A conference call and webcast for Q2 2025 results is scheduled for Tuesday, August 5, 2025, at 10:00 a.m. Eastern time - A conference call is scheduled for Tuesday, August 5, 2025, at **10:00 a.m. Eastern time**[9](index=9&type=chunk) - The call and slide presentation will be webcast on the company's investor relations website[9](index=9&type=chunk) [Company Information & Disclaimers](index=13&type=section&id=Company%20Information%20%26%20Disclaimers) MSA Safety is a global safety product leader with **$1.8 billion** 2024 revenues, providing disclaimers on forward-looking statements and non-GAAP financial measures - MSA Safety is a global leader in advanced safety products with **2024 revenues of $1.8 billion** and over 5,000 employees worldwide[26](index=26&type=chunk) - The report contains forward-looking statements that involve risks and uncertainties, and readers are cautioned against placing undue reliance on them[27](index=27&type=chunk) - The press release includes non-GAAP financial measures which management believes are useful for investors but should be viewed as supplemental to GAAP results[28](index=28&type=chunk)[30](index=30&type=chunk)

Core Insights - MSA Safety Incorporated reported a net sales increase of 3% year-over-year for Q2 2025, reaching $474.1 million, while organic sales remained flat [4][5][6] - The company experienced a decline in operating income by 14% to $85.9 million, with an operating margin of 18.1% [4][5] - MSA Safety completed the acquisition of M&C TechGroup for $188 million, aimed at expanding its market in detection and diversifying end markets [3][5][6] Financial Performance - Q2 2025 net income was $62.8 million, or $1.59 per diluted share, down 13% from the previous year [4][5] - Adjusted EBITDA for Q2 2025 was $116.5 million, a decrease of 4% compared to Q2 2024 [4][5] - Free cash flow for the quarter was $37.9 million, with a conversion rate of 60% [4][5] Segment Performance - The Americas segment reported net sales of $320.1 million, a 2% increase year-over-year, while the international segment saw a 4% increase to $154.0 million [4][5] - Detection products accounted for 41% of consolidated sales, with a 13% increase in GAAP reported sales [11][13] - The Fire Service segment experienced a 5% decline in sales, while Industrial PPE and Other products saw a 2% decrease [11][13] Strategic Initiatives - The company reaffirmed its low-single-digit organic sales growth outlook for 2025, while preparing for various macroeconomic scenarios [6][7] - MSA Safety's capital allocation strategy included share repurchases totaling $30 million and $29 million in capital expenditures [5][6] - The company is focused on enhancing its manufacturing and engineering capabilities through strategic investments [6]