Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended February 28, 2025 o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-06936 Commission Company Name: WD 40 CO For the transition period from ________ to ________ WD-40 COMPANY (Exact name of registrant as specifie ...

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Historical financial and operating data in this presentation reflect the consolidated results of WD-40 Company and its subsidiaries (collectively, the "Company"). The Company markets maintenance products ("MP") under the WD-40®, 3-IN-ONE® and GT85® brand names. The WD-40 brand portfolio also includes the WD-40® Multi-Use Product, the WD-40 Specialist® and WD-40 BIKE® product lines. The Company markets the homecare and cleaning products ("HCCP") under the following brands: X-14® and 2000 Flushes® automatic t ...

Financial Data and Key Metrics Changes - The company reported net sales of $146.1 million for the second quarter, an increase of 5% from the same quarter last year [9] - Adjusting for foreign currency translation, net sales would have been $150.9 million, reflecting a 9% increase compared to the prior year [10] - Gross margin improved to 54.6%, up from 52.4% last year, representing an improvement of 220 basis points [48][49] - Adjusted EBITDA was $25.8 million, up 10% from the prior year [58] Business Line Data and Key Metrics Changes - Net sales for core maintenance products reached $139.3 million, a 6% increase despite currency headwinds [11] - Sales of WD-40 Multi-Use Product in Latin America increased by 47% compared to the prior year quarter [13] - Sales of WD-40 Specialist products were up 12% year-to-date, with strong growth in EIMEA and the Americas [32][33] Market Data and Key Metrics Changes - Total sales in the Americas increased 3% to $65.5 million, with a 4% increase in maintenance products [12] - EIMEA sales increased 10% to $59.6 million, with maintenance products up 11% [17] - Asia Pacific sales decreased 1% to $21 million, primarily due to lower sales of WD-40 Multi-Use product [20] Company Strategy and Development Direction - The company is focusing on geographic expansion and exploring alternative go-to-market strategies [27][28] - The Must-Win Battles include accelerating premiumization and driving WD-40 Specialist growth [30][32] - The company aims to achieve a gross margin of between 55% and 56% in fiscal year 2025, one year earlier than previously projected [51] Management's Comments on Operating Environment and Future Outlook - Management noted that geopolitical fragmentation is increasing, which may lead to new market strategies [27] - The company expects cost savings from supply chain optimization to offset potential tariff impacts [41][43] - Future guidance for fiscal year 2025 includes net sales growth projected between 6% and 11% [69] Other Important Information - The anticipated divestiture of the home care and cleaning business is progressing, with discussions ongoing with potential buyers [46] - Employee engagement index score increased to 94%, indicating a motivated workforce [39] - The company plans to maintain a disciplined capital allocation strategy, prioritizing dividends and share repurchases [64] Q&A Session Summary Question: Impact of tariffs on operations - Management indicated that the centralized supply chain mitigates tariff risks, with most manufacturing occurring in the U.S. [80] Question: Retaliatory tariffs from China - Management stated there is currently no material risk to operations in China due to localized supply chains [84] Question: Supply chain optimization details - Management explained that supply chain optimization involves a combination of dual and sole sourcing to create a diversified geographic footprint [86] Question: Timing for qualifying suppliers - Management noted that qualifying a new supplier can take 18 months to 2 years [90] Question: Operating income guidance - Management clarified that the operating income guidance remains unchanged due to foreign currency impacts [92] Question: Potential upside from foreign exchange fluctuations - Management acknowledged that recent trends in the euro could provide a tailwind if they hold [95]

Financial Performance - Total net sales for the second quarter were $146.1 million, an increase of 5 percent compared to the prior year fiscal quarter[5]. - Maintenance product sales reached $139.3 million, reflecting a 6 percent increase year-over-year, driven by strong performance in EIMEA and Latin America[5]. - Net sales for the six months ended February 28, 2025, increased to $299.6 million, up from $279.5 million in the same period of 2024, representing a growth of approximately 7.2 percent[27]. - Net income surged to $29.9 million, a 92 percent increase from the prior year fiscal quarter, aided by a favorable tax adjustment of $11.9 million[5]. - Net income for the six months ended February 28, 2025, was $48.8 million, compared to $33.0 million for the same period in 2024, indicating a growth of approximately 47.6 percent[29]. Earnings and Margins - Gross margin improved to 54.6 percent, up from 52.4 percent in the prior year fiscal quarter, representing a 220 basis point increase[5]. - Diluted earnings per share rose to $2.19, a 92 percent increase, with non-GAAP adjusted diluted EPS at $1.32, up 16 percent[5]. - Diluted earnings per share are now expected to be between $5.25 and $5.55, reflecting anticipated growth of 11 to 17 percent compared to 2024 pro forma results[19]. Segment Performance - The Americas segment accounted for 45 percent of total net sales, with a 3 percent increase in sales, primarily due to a 4 percent rise in WD-40 Multi-Use Product sales[9]. - EIMEA segment sales increased by 10 percent, driven by a 12 percent rise in WD-40 Multi-Use Product sales, particularly in Italy and the Benelux region[9]. - Asia-Pacific segment sales decreased by 1 percent, with a notable 2 percent decline in WD-40 Multi-Use Product sales, although sales in China increased by 5 percent[9]. Guidance and Future Plans - The company revised its fiscal year 2025 guidance, projecting net sales growth between 6 and 11 percent, with total net sales expected to be between $600 million and $630 million[12]. - The company plans to divest its homecare and cleaning product portfolios in the Americas and United Kingdom, as these products represented only 5 percent of total net sales[10]. Tax and Financial Position - The provision for income tax has been reduced and is expected to be around 22.5 percent[19]. - The company reported a tax benefit from the release of an uncertain tax position amounting to $11.9 million[29]. - Total current assets increased to $272.4 million as of February 28, 2025, compared to $255.4 million as of August 31, 2024[25]. - Total liabilities decreased to $216.1 million as of February 28, 2025, from $218.5 million as of August 31, 2024[25]. - Cash and cash equivalents at the end of the period were $53.0 million, compared to $55.4 million at the end of the same period in 2024[29]. - Operating expenses for the six months ended February 28, 2025, were $115.4 million, up from $103.4 million in the same period of 2024, reflecting an increase of approximately 11.5 percent[27]. Reporting - The company expects to file its Quarterly Report on Form 10-Q for the period ended February 28, 2025, on April 9, 2025[21].

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Core Viewpoint - WD-40's stock declined 6.3% despite beating Q1 earnings forecasts, indicating investor concerns about future guidance rather than current performance [1][3]. Financial Performance - WD-40 reported Q1 earnings of $1.39 per share, exceeding analyst expectations of $1.26 per share [1]. - Sales for the quarter reached $153.5 million, representing a 9% increase compared to the same quarter last year [1]. - The gross profit margin improved by 1 percentage point to 54.8% [1]. Expense Analysis - Selling, general, and administrative expenses increased by 14%, outpacing sales growth [2]. - Advertising and sales promotions expenses rose by 20%, which balanced out the gross margin improvements [2]. - Consequently, earnings per share grew by 9%, aligning closely with sales growth [2]. Future Guidance - For fiscal 2025, WD-40 forecasts sales growth between 6% and 11%, suggesting slower growth compared to Q1 [4]. - The projected gross profit margin is expected to be between 54% and 55%, indicating a slight decline from Q1's 54.8% [4]. - Management anticipates earnings per share for the year to be between $5.20 and $5.45, which is below Wall Street's expectation of $5.36 [5]. Valuation Concerns - The anticipated 2% annual earnings growth raises questions about the justification of WD-40's current stock price, which is at 46 times trailing earnings [5].

Q1 FY25 Earnings Results JANUARY 10, 2025 Forward-Looking Statements Historical financial and operating data in this presentation reflect the consolidated results of WD-40 Company and its subsidiaries (collectively, the "Company"). The Company markets maintenance products ("MP") under the WD-40®, 3-IN-ONE® and GT85® brand names. The WD-40 brand portfolio also includes the WD-40® Multi-Use Product, the WD-40 Specialist® and WD-40 BIKE® product lines. The Company markets the homecare and cleaning products ("H ...

Financial Data and Key Metrics - The company encourages investors to review the earnings presentation, earnings press release, and Form 10-Q for the period ending November 30, 2024, for detailed financial information [2] - The call includes discussions on certain non-GAAP measures, with descriptions and reconciliations available in SEC filings and earnings documents on the investor relations website [3] Business Line Data and Key Metrics - No specific data or metrics related to individual business lines were provided in the content Market Data and Key Metrics - No specific data or metrics related to individual markets were provided in the content Company Strategy and Industry Competition - No specific details on company strategy or industry competition were provided in the content Management Commentary on Operating Environment and Future Outlook - The call includes forward-looking statements about the company's expectations for future performance, with actual results potentially differing materially [3] Other Important Information - A replay and transcript of the call will be made available shortly after the call on the investor relations website [2] Q&A Session Summary - No Q&A session details were provided in the content

Sales Performance - Consolidated net sales increased by $13.1 million or 9% to $153.5 million compared to the prior year, driven by higher sales volume and price increases[97] - Americas segment sales grew 8% to $69.4 million, led by 9% growth in WD-40 Multi-Use Product sales[98][99] - EIMEA segment sales surged 18% to $57.5 million, with WD-40 Multi-Use Product sales up 21%[98][105] - Asia-Pacific segment sales declined 4% to $26.6 million, with WD-40 Multi-Use Product sales down 6%[98][108] - Net sales increased to $153.5 million in Q3 2024, up 9.3% from $140.4 million in Q3 2023[16] - Total net sales for the three months ended November 30, 2024, were $153.495 million, up from $140.416 million in the same period in 2023[68] - WD-40 Multi-Use Product sales increased to $118.547 million in Q3 2024 from $107.677 million in Q3 2023[68] - WD-40 Specialist sales rose to $19.172 million in Q3 2024 from $16.842 million in Q3 2023[68] - Foreign currency exchange rates favorably impacted consolidated net sales by $1.5 million[97] - Asia-Pacific segment net sales decreased, with WD-40 Multi-Use Product sales down $1.3 million (6%), driven by a $2.6 million decline in Asia distributor markets, partially offset by a $1.0 million increase in China[109] - WD-40 Specialist sales in the Asia-Pacific segment increased $1.2 million (17%), driven by higher sales volume in Iberia, U.K., and Italy, each up $0.5 million, $0.3 million, and $0.3 million respectively[109] Profitability and Margins - Gross profit margin improved to 54.8% from 53.8% in the prior year period[97] - Net income rose 8% to $18.9 million, with diluted EPS increasing 9% to $1.39[97] - Gross profit increased to $84.1 million, up $8.5 million, with gross margin improving to 54.8% from 53.8% (100 basis points increase)[111] - Net income rose to $18.9 million in Q3 2024, an 8.3% increase from $17.5 million in Q3 2023[16] - Gross profit margin improved to 54.8% in Q3 2024, up from 53.8% in Q3 2023[16] - Net income for the three months ended November 30, 2024, was $18.925 million, compared to $17.482 million for the same period in 2023[19] - Net income for the three months ended November 30, 2024, was $18.925 million, compared to $17.482 million for the same period in 2023[67] Expenses and Costs - SG&A expenses increased to $50.5 million, up $6.4 million (14%), representing 32.9% of net sales compared to 31.4% in the prior year[113] - Advertising and sales promotion expenses increased to $8.4 million, up $1.4 million (20%), representing 5.5% of net sales compared to 5.0% in the prior year[116] - Operating expenses increased to $59.0 million in Q3 2024, up 14.8% from $51.4 million in Q3 2023[16] - Americas segment operating income decreased to $12.7 million, down $1.5 million (11%), with operating expenses increasing $4.1 million primarily due to higher employee-related costs[121] Shareholder Returns and Capital Allocation - The company repurchased 13,750 shares at an average price of $263.75 per share for a total cost of $3.6 million under its $50 million share repurchase plan[161][163] - Returned $15.6 million to stockholders through share repurchases and dividends in the quarter[97] - The company declared a 7% increase in the regular quarterly cash dividend, raising it from $0.88 per share to $0.94 per share, payable on January 31, 2025[88] - Treasury stock purchases totaled $3.6 million in Q3 2024, up 50.2% from $2.4 million in Q3 2023[22] - Dividends paid increased to $12.0 million in Q3 2024, up 5.9% from $11.3 million in Q3 2023[22] - Cash dividends paid in Q3 2024 were $0.88 per share, totaling $11.958 million, compared to $0.83 per share and $11.297 million in Q3 2023[19] - The company repurchased 13,750 shares at an average price of $263.75 per share, totaling $3.6 million, leaving $38.3 million authorized under the 2023 Repurchase Plan[66] Cash Flow and Liquidity - Cash and cash equivalents grew to $54.9 million as of November 30, 2024, up 17.6% from $46.7 million at August 31, 2024[14] - Total current assets increased to $262.8 million as of November 30, 2024, up 2.9% from $255.4 million at August 31, 2024[14] - Net cash provided by operating activities was $14.9 million in Q3 2024, down 44.5% from $26.9 million in Q3 2023[22] - The company extended its revolving credit facility maturity date to April 30, 2029, under the Second Amended and Restated Credit Agreement[58] - The company's revolving credit agreement includes a $125.0 million limit on other unsecured indebtedness[62] Tax and Financial Adjustments - The release of an unrecognized tax benefit is expected to generate a favorable income tax adjustment of $11.9 million in the fiscal second quarter ending February 28, 2025[89] - The effective tax rate decreased by 2.2% from 24.2% in 2023 to 22.0% in 2024, primarily due to increased excess tax benefits from stock-based equity awards[81] Inventory and Assets - Total inventories decreased from $79.088 million as of August 31, 2024, to $74.887 million as of November 30, 2024, with finished goods inventory increasing from $60.331 million to $63.874 million[45] - Total assets held for sale as of November 30, 2024, were $9.865 million, including intangibles, goodwill, and inventory[44] - Goodwill decreased by $1.069 million due to assets held for sale, with the balance as of November 30, 2024, at $96.584 million[47] - The carrying amount of definite-lived intangible assets decreased from $6.222 million as of August 31, 2024, to $2.287 million as of November 30, 2024, due to amortization and translation adjustments[52] - The gross carrying amount of definite-lived intangible assets increased slightly from $38.863 million as of August 31, 2024, to $39.091 million as of November 30, 2024[51] - The company's goodwill showed no indicators of impairment as of November 30, 2024, with no impairment losses recorded[48] Liabilities and Debt - Total liabilities decreased to $221.0 million as of November 30, 2024, down 1.1% from $218.5 million at August 31, 2024[14] - The fair value of the company's senior notes was estimated at $60.3 million as of November 30, 2024, compared to a carrying value of $66.4 million[39] Operational and Strategic Changes - The company changed the functional currency of its U.K. subsidiary from Pound Sterling to Euro effective September 1, 2024[36] - The company has no outstanding commitments for purchasing finished goods and components as of November 30, 2024[75] Homecare and Cleaning Products - Homecare and cleaning product sales decreased 3% to $7.99 million, with a 7% decline in the Americas segment[97][99] - Homecare and cleaning product sales in the Asia-Pacific segment decreased $0.4 million (19%) due to reduced demand in the U.K. from lower advertising and promotional activities[109]