Financial Data and Key Metrics Changes - Orders increased by 2% year over year to $259 million, driven by an 8% growth in project-related orders, particularly in EMEA [5][6] - Sales for Q1 were $235.9 million, down 2% from the prior year, attributed to a 3% decline in short cycle sales [12][16] - Gross profit decreased by $11.8 million year over year to $77.2 million, impacted by lower sales volume and tariff-related costs [14][16] - Adjusted earnings per diluted share were $0.50, a decrease of $0.12 compared to the prior year, primarily due to a $0.11 tariff-related impact [16][17] Business Line Data and Key Metrics Changes - Short cycle orders were down 4% due to surcharges and price increases, while project-related sales remained unchanged from the prior year despite order growth [5][12] - SG&A expenses decreased by 5% excluding acquisition-related costs, resulting in an adjusted SG&A of $54.8 million [10][15] - Adjusted operating income was $18.5 million with an adjusted operating margin of 7.8% [15] Market Data and Key Metrics Changes - The backlog increased by $67 million or 23% year over year to $360 million, driven by longer cycle project orders [6][12] - Strength was noted in vertical end markets such as battery production, e-commerce, food and beverage, aerospace, oil and gas, and rail projects [6][7] - Tariffs were identified as a headwind, with an expected $10 million impact on operating profit in the first half of the year [9][17] Company Strategy and Development Direction - The company is focused on operational execution, cost control, and advancing its strategic plan, particularly in targeted end markets [18][58] - The pending acquisition of Keto Crosby is expected to scale the business, expand customer capabilities, and enable synergies [10][18] - The company anticipates achieving tariff cost neutrality by 2026 and margin neutrality by fiscal 2027 [9][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the order backlog and the potential for growth in targeted industries despite macroeconomic uncertainties [6][57] - The company expects the next few quarters to remain volatile but anticipates stabilization in demand over time [6][18] - Management remains focused on mitigating tariff impacts and is implementing price adjustments to offset these costs [9][17] Other Important Information - The company is preparing for the integration of Keto Crosby and expects to close the acquisition by the end of the calendar year [10][36] - Free cash flow was a use of cash of $21.4 million in the quarter, reflecting normal working capital seasonality [16][46] Q&A Session Summary Question: Can you help parse out the gross margin performance in the quarter? - Management noted a 180 basis point erosion in gross margin tied to tariffs and a mix of lower volume of higher margin products [20][22] Question: How should we think about gross margins moving forward? - Management expressed confidence in expanding margins, anticipating improvements as the year progresses and production ramps up [24][25] Question: Can you provide more detail on order backlog in areas like EV battery and e-commerce? - Management highlighted a strong funnel of opportunities in battery production, e-commerce, and defense industries, with positive trends in steel and heavy equipment [27][28] Question: Can you provide an update on the Keto Crosby acquisition? - Management confirmed that the acquisition is advancing and expects to close by the end of the year, with preparations for integration underway [34][36] Question: How much of the backlog is actionable this year? - Management indicated that 70-80% of the current backlog is actionable within the fiscal year, with the remainder extending beyond that timeframe [40][41] Question: What are the expectations for cash flow this year? - Management noted that cash flow predictions are challenging due to deal costs and timing of the acquisition closure, but improvements in working capital are expected [46][47]

July 30, 2025 Q1 Fiscal 2026 Financial Results Conference Call David Wilson President & Chief Executive Officer Gregory Rustowicz Executive Vice President Finance & Chief Financial Officer Kristine Moser Vice President, Investor Relations & Treasurer Safe Harbor Statement This presentation and the accompanying oral discussion contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are generally identified by the use of ...

Company Performance - Columbus McKinnon (CMCO) reported quarterly earnings of $0.5 per share, exceeding the Zacks Consensus Estimate of $0.47 per share, but down from $0.62 per share a year ago, representing an earnings surprise of +6.38% [1] - The company posted revenues of $235.92 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.61%, although this is a decrease from year-ago revenues of $239.73 million [2] - Over the last four quarters, Columbus McKinnon has surpassed consensus EPS estimates three times and topped consensus revenue estimates just once [2] Stock Performance - Columbus McKinnon shares have declined approximately 54.7% since the beginning of the year, contrasting with the S&P 500's gain of 8.3% [3] - The current Zacks Rank for Columbus McKinnon is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the coming quarter is $0.53 on revenues of $235.07 million, and for the current fiscal year, it is $2.45 on revenues of $956.01 million [7] - The estimate revisions trend for Columbus McKinnon was mixed ahead of the earnings release, and future revisions may change following the recent earnings report [6] Industry Context - The Manufacturing - Material Handling industry, to which Columbus McKinnon belongs, is currently ranked in the bottom 4% of over 250 Zacks industries, indicating potential challenges for stock performance [8]

[Executive Summary & Q1 FY26 Highlights](index=1&type=section&id=Executive%20Summary) This section provides an overview of Columbus McKinnon's first quarter fiscal year 2026 performance, including key financial highlights and CEO commentary on strategic direction [First Quarter 2026 Highlights](index=1&type=section&id=First%20Quarter%202026%20Highlights) Columbus McKinnon reported its Q1 FY26 results, with orders increasing 2% driven by project-related growth, leading to a 23% year-over-year increase in backlog and a book-to-bill ratio of 1.1x. Despite a net loss, adjusted EBITDA and adjusted EPS were positive, though impacted by tariffs and acquisition-related expenses Q1 FY26 Value | Metric | Q1 FY26 Value | | :-------------------------------- | :------------ | | Orders | $258.6 million (↑ 2%) | | Backlog | $360.1 million (↑ 23% YoY) | | Book-to-Bill Ratio | 1.1x | | Net Sales | $235.9 million | | Operating Margin | 2.3% (Adjusted: 7.8%) | | Net Loss | $1.9 million | | Net Loss Margin | (0.8%) | | Adjusted EBITDA | $30.8 million | | Adjusted EBITDA Margin | 13.0% | | GAAP EPS | ($0.07) | | Adjusted EPS | $0.50 | - Net loss includes **$8.1 million** of Kito Crosby acquisition-related expenses, **$4.2 million** tariff impact, and **$2.5 million** of business realignment costs on a pre-tax basis. Adjusted EPS includes an **$0.11 per share** unfavorable tariff impact[3](index=3&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO David J. Wilson noted that Q1 FY26 results were largely as expected, with sustained order growth despite global tariff policies pressuring near-term results. He reaffirmed optimism for the business, highlighted a healthy demand environment, and emphasized strategic execution, cost management, and progress towards the Kito Crosby acquisition - Anticipates approximately **$10 million** of net tariff impact in the first half of fiscal 2026, consistent with prior guidance[2](index=2&type=chunk) - Demand environment remains healthy, underscored by a **1.1x book-to-bill ratio** and a **23% increase in backlog** year-over-year[2](index=2&type=chunk) - Progressing towards the closing of the Kito Crosby acquisition, expecting benefits of scale, improved solutions, synergies, and strong free cash flow to drive profitable growth and long-term shareholder value[2](index=2&type=chunk) [Financial Results - Q1 FY26](index=2&type=section&id=Financial%20Results) This section details Columbus McKinnon's financial performance for the first quarter of fiscal year 2026, covering sales, operating results, and condensed GAAP financial statements [First Quarter Fiscal 2026 Sales](index=2&type=section&id=First%20Quarter%20Fiscal%202026%20Sales) Net sales for Q1 FY26 decreased by 1.6% year-over-year to $235.9 million, primarily due to lower volume, partially offset by price improvements and favorable foreign currency translation. Both U.S. and non-U.S. sales experienced declines Q1 FY26 Net Sales Performance | Metric | Q1 FY26 ($ in millions) | Q1 FY25 ($ in millions) | Change ($ in millions) | Change (%) | | :---------------- | :---------------------- | :---------------------- | :--------------------- | :--------- | | Net sales | $235.9 | $239.7 | $(3.8) | (1.6)% | | U.S. sales | $135.3 | $136.3 | $(1.0) | (0.7)% | | Non-U.S. sales | $100.6 | $103.4 | $(2.8) | (2.7)% | - The decrease in net sales was driven by **$7.9 million** of lower volume, partially offset by **$2.0 million** in price improvement and **$3.1 million** from favorable foreign currency translation[4](index=4&type=chunk) Q1 FY26 Net Sales Bridge | Component | $ Change (in millions) | % Change | | :------------------------ | :--------------------- | :------- | | Fiscal 2025 Net Sales | $239.7 | | | Pricing | $2.4 | 1.0% | | Volume | $(9.4) | (3.9)% | | Foreign currency translation | $3.1 | 1.3% | | Total change | $(3.8) | (1.6)% | | Fiscal 2026 Net Sales | $235.9 | | [First Quarter Fiscal 2026 Operating Results](index=2&type=section&id=First%20Quarter%20Fiscal%202026%20Operating%20Results) Operating results for Q1 FY26 showed significant declines across profitability metrics. Gross profit decreased by 13.3%, and income from operations fell by 74.0%. Net income turned into a loss, and both GAAP and Adjusted EPS decreased, largely due to lower volume, tariff impacts, and acquisition-related costs Q1 FY26 Operating Results Summary | Metric | Q1 FY26 | Q1 FY25 | Change ($ in millions) | % Change | | :-------------------------- | :------ | :------ | :--------------------- | :--------- | | Gross profit | $77.2 | $89.0 | $(11.8) | (13.3)% | | Gross margin | 32.7% | 37.1% | (440) bps | | | Adjusted Gross Profit | $80.9 | $91.0 | $(10.1) | (11.1)% | | Adjusted Gross Margin | 34.3% | 38.0% | (370) bps | | | Income from operations | $5.5 | $21.1 | $(15.7) | (74.0)% | | Operating margin | 2.3% | 8.8% | (650) bps | | | Adjusted Operating Income | $18.5 | $25.7 | $(7.2) | (27.9)% | | Adjusted Operating Margin | 7.8% | 10.7% | (290) bps | | | Net income (loss) | $(1.9) | $8.6 | $(10.5) | NM | | Net income (loss) margin | (0.8)% | 3.6% | (440) bps | | | GAAP EPS | $(0.07) | $0.30 | $(0.37) | NM | | Adjusted EPS | $0.50 | $0.62 | $(0.12) | (19.4)% | | Adjusted EBITDA | $30.8 | $37.5 | $(6.7) | (17.9)% | | Adjusted EBITDA Margin | 13.0% | 15.6% | (260) bps | | Q1 FY26 Gross Profit Bridge | Component | Quarter ($ in millions) | | :------------------------------------------ | :---------------------- | | Fiscal 2025 Gross Profit | $89.0 | | Price, net of manufacturing costs changes (incl. inflation) | $(5.7) | | Monterrey, MX new factory start-up costs | $(0.3) | | Factory and warehouse consolidation costs | $(0.4) | | Sales volume and mix | $(5.4) | | Other | $(1.0) | | Foreign currency translation | $1.0 | | Total change | $(11.8) | | Fiscal 2026 Gross Profit | $77.2 | [Condensed Consolidated Income Statements (GAAP)](index=5&type=section&id=Condensed%20Consolidated%20Income%20Statements%20-%20UNAUDITED) The condensed consolidated income statement for Q1 FY26 shows a net loss of $1.9 million, a significant decline from a net income of $8.6 million in the prior-year period. This was primarily driven by a decrease in gross profit and a substantial reduction in income from operations, alongside increased general and administrative expenses Condensed Consolidated Income Statements (Unaudited) - Three Months Ended June 30 | (In thousands, except per share and percentage data) | June 30, 2025 | June 30, 2024 | Change % | | :-------------------------------------------------- | :------------ | :------------ | :------- | | Net sales | $235,920 | $239,726 | (1.6)% | | Cost of products sold | 158,698 | 150,696 | 5.3 % | | Gross profit | 77,222 | 89,030 | (13.3)% | | Gross profit margin | 32.7 % | 37.1 % | | | Selling expenses | 28,531 | 27,770 | 2.7 % | | General and administrative expenses | 30,743 | 26,447 | 16.2 % | | Research and development expenses | 4,821 | 6,166 | (21.8)% | | Amortization of intangibles | 7,635 | 7,500 | 1.8 % | | Income from operations | 5,492 | 21,147 | (74.0)% | | Operating margin | 2.3 % | 8.8 % | | | Interest and debt expense | 8,698 | 8,235 | 5.6 % | | Investment (income) loss | (1,049) | (209) | 401.9 % | | Foreign currency exchange (gain) loss | (342) | 395 | NM | | Other (income) expense, net | (177) | 676 | NM | | Income (loss) before income tax expense (benefit) | (1,638) | 12,050 | NM | | Income tax expense (benefit) | 260 | 3,421 | (92.4)% | | Net income (loss) | $(1,898) | $8,629 | NM | | Basic income (loss) per share | $(0.07) | $0.30 | NM | | Diluted income (loss) per share | $(0.07) | $0.30 | NM | [Condensed Consolidated Balance Sheets (GAAP)](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to $1,779.2 million from $1,738.8 million at March 31, 2025, primarily driven by increases in trade accounts receivable, inventories, goodwill, and other intangibles. Total liabilities also increased, while total shareholders' equity saw a modest rise Condensed Consolidated Balance Sheets (Unaudited) - As of June 30, 2025 vs. March 31, 2025 | (In thousands) | June 30, 2025 | March 31, 2025 | | :------------------------------------------ | :------------ | :------------- | | **ASSETS** | | | | Total current assets | $478,476 | $465,769 | | Property, plant, and equipment, net | 106,735 | 106,164 | | Goodwill | 732,413 | 710,807 | | Other intangibles, net | 360,986 | 356,562 | | Total assets | $1,779,192 | $1,738,788 | | **LIABILITIES AND SHAREHOLDERS' EQUITY** | | | | Total current liabilities | $259,239 | $257,919 | | Term loan, AR securitization facility and finance lease obligations | 422,795 | 420,236 | | Other non current liabilities | 186,275 | 178,538 | | Total liabilities | $868,309 | $856,693 | | Total shareholders' equity | $910,883 | $882,095 | | Total liabilities and shareholders' equity | $1,779,192 | $1,738,788 | [Condensed Consolidated Statements of Cash Flows (GAAP)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20-%20UNAUDITED) For the three months ended June 30, 2025, net cash used for operating activities increased to $18.2 million from $10.8 million in the prior year, primarily due to the net loss and changes in working capital. Investing activities also used cash, while financing activities saw a reduced outflow compared to the prior year Condensed Consolidated Statements of Cash Flows (Unaudited) - Three Months Ended June 30 | (In thousands) | June 30, 2025 | June 30, 2024 | | :------------------------------------------ | :------------ | :------------ | | Net cash provided by (used for) operating activities | $(18,153) | $(10,758) | | Net cash provided by (used for) investing activities | $(3,217) | $(4,041) | | Net cash provided by (used for) financing activities | $(977) | $(30,583) | | Effect of exchange rate changes on cash | $(2,614) | $(371) | | Net change in cash and cash equivalents | $(24,961) | $(45,753) | | Cash, cash equivalents, and restricted cash at end of period | $28,972 | $68,623 | - Operating cash flow was negatively impacted by increases in trade accounts receivable and inventories, and a decrease in trade accounts payable[20](index=20&type=chunk) [Strategic Outlook & Operational Data](index=2&type=section&id=Strategic%20Outlook%20%26%20Operational%20Data) This section outlines Columbus McKinnon's capital allocation priorities, fiscal year 2026 guidance, and additional operational metrics for the quarter [Capital Allocation Priorities](index=2&type=section&id=Capital%20Allocation%20Priorities) The Company's near-term capital allocation strategy focuses on debt reduction to deleverage the balance sheet while maintaining a consistent dividend payment. Long-term, Columbus McKinnon aims to utilize significant free cash flow generation to advance its Intelligent Motion strategy - Near-term priority: Allocate capital to pay down debt for deleveraging[6](index=6&type=chunk) - Commitment to consistent dividend payment[6](index=6&type=chunk) - Long-term goal: Utilize significant free cash flow to advance the Intelligent Motion strategy across the fragmented marketplace[6](index=6&type=chunk) [Fiscal Year 2026 Guidance](index=3&type=section&id=Fiscal%20Year%202026%20Guidance) Columbus McKinnon reaffirmed its fiscal year 2026 guidance, projecting net sales and adjusted EPS to be flat to slightly up. This guidance excludes the impact of the pending Kito Crosby acquisition and assumes tariffs will be a headwind in the first half, with neutrality expected by the second half FY26 Guidance | Metric | FY26 Outlook | | :-------- | :----------- | | Net sales | Flat to slightly up | | Adjusted EPS | Flat to slightly up | - Guidance does not contemplate the impact of the pending Kito Crosby acquisition[7](index=7&type=chunk) - Assumes approximately **$35 million** of interest expense, **$30 million** of amortization, an effective tax rate of **25%**, and **29.0 million** diluted average shares outstanding[8](index=8&type=chunk) - Tariffs are expected to be a headwind to Adjusted EPS in the first half of fiscal 2026 due to timing of supply chain adjustments, pricing increases, and surcharge implementation lagging tariff costs, with tariff cost neutrality expected by the second half[7](index=7&type=chunk) [Additional Operational Data](index=9&type=section&id=Additional%20Data) Key operational metrics for Q1 FY26 show a significant increase in backlog, with long-term backlog growing as a percentage of total. Debt to total capitalization slightly improved, while working capital as a percentage of sales increased. Days sales outstanding and days' inventory also increased, and free cash flow was negative Key Operational Metrics | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :------------------------------------ | :------------ | :------------- | :------------ | | Backlog | $360.1 million | $322.5 million | $292.8 million | | Long-term backlog (beyond 3 months) | $223.4 million | $190.3 million | $156.0 million | | Long-term backlog as % of total backlog | 62.0 % | 59.0 % | 53.3 % | | Debt to total capitalization percentage | 34.2 % | 34.8 % | 36.6 % | | Debt, net of cash, to net total capitalization | 32.8 % | 32.1 % | 33.3 % | | Working capital as a % of sales | 25.2 % | 21.3 % | 22.5 % | | Days sales outstanding | 69.5 days | 61.0 days | 63.3 days | | Inventory turns per year | 2.9 turns | 3.4 turns | 3.0 turns | | Days' inventory | 125.9 days | 107.4 days | 121.7 days | | Days payables outstanding | 56.1 days | 54.9 days | 50.6 days | | Net cash provided by (used for) operating activities | $(18.2) million | $35.6 million | $(10.8) million | | Capital expenditures | $3.2 million | $6.1 million | $4.6 million | | Free Cash Flow | $(21.4) million | $29.5 million | $(15.4) million | [Company Information & Non-GAAP Reconciliations](index=4&type=section&id=Company%20Information%20%26%20Non-GAAP%20Reconciliations) This section provides background on Columbus McKinnon, a safe harbor statement, and detailed reconciliations of non-GAAP financial measures to their GAAP equivalents [About Columbus McKinnon](index=4&type=section&id=About%20Columbus%20McKinnon) Columbus McKinnon Corporation is a global designer, manufacturer, and marketer of intelligent motion solutions for material handling, focusing on safety and quality in commercial and industrial applications. Their product portfolio includes hoists, crane components, conveyor systems, rigging tools, and digital control systems - Leading worldwide designer, manufacturer, and marketer of intelligent motion solutions for material handling[12](index=12&type=chunk) - Key products include hoists, crane components, precision conveyor systems, rigging tools, light rail workstations, and digital power and motion control systems[12](index=12&type=chunk) - Focuses on commercial and industrial applications requiring superior design, engineering, safety, and quality[12](index=12&type=chunk) [Safe Harbor Statement](index=4&type=section&id=Safe%20Harbor%20Statement) This section outlines the Company's safe harbor statement regarding forward-looking statements, emphasizing that such statements are based on current expectations and assumptions, involve known and unknown risks and uncertainties, and are subject to change. Investors are cautioned not to place undue reliance on these statements, which speak only as of their date - Contains forward-looking statements regarding strategy, outlook, growth prospects, financial targets, capital allocation, economic trends, Kito Crosby acquisition benefits, debt repayment plans, and competitive environment[13](index=13&type=chunk) - Forward-looking statements involve known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially[13](index=13&type=chunk) - Columbus McKinnon undertakes no duty to update publicly any such forward-looking statement, except as required by applicable law[13](index=13&type=chunk) [Non-GAAP Financial Measures & Reconciliations](index=10&type=section&id=NON-GAAP%20FINANCIAL%20MEASURES) This section provides definitions and reconciliations of non-GAAP financial measures to their most directly comparable GAAP measures. The Company uses these non-GAAP metrics, such as Adjusted Gross Profit, Adjusted Operating Income, Adjusted Net Income, Adjusted EPS, and Adjusted EBITDA, to provide supplemental information for investors to better understand financial performance, historical comparisons, and industry comparisons, despite not being GAAP-compliant - Non-GAAP financial measures are provided as supplemental information and should not be considered superior to, a substitute for, or an alternative to GAAP measures[30](index=30&type=chunk) - The Company believes these non-GAAP measures assist investors in understanding current and historical financial performance and facilitate comparisons with other companies[32](index=32&type=chunk)[35](index=35&type=chunk)[38](index=38&type=chunk)[40](index=40&type=chunk) [Adjusted Gross Profit Reconciliation](index=10&type=section&id=Reconciliation%20of%20Gross%20Profit%20to%20Adjusted%20Gross%20Profit) This reconciliation details the adjustments made to GAAP gross profit to arrive at the non-GAAP adjusted gross profit for the quarter Reconciliation of Gross Profit to Adjusted Gross Profit (Three Months Ended June 30) | ($ in thousands) | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Gross profit | $77,222 | $89,030 | | Add back (deduct): | | | | Business realignment costs | 1,385 | 392 | | Factory and warehouse consolidation costs | 425 | — | | Monterrey, MX new factory start-up costs | 1,901 | 1,625 | | Adjusted Gross Profit | $80,933 | $91,047 | | Gross margin | 32.7 % | 37.1 % | | Adjusted Gross Margin | 34.3 % | 38.0 % | [Adjusted Operating Income Reconciliation](index=11&type=section&id=Reconciliation%20of%20Income%20from%20Operations%20to%20Adjusted%20Operating%20Income) This reconciliation details the adjustments made to GAAP income from operations to arrive at the non-GAAP adjusted operating income for the quarter Reconciliation of Income from Operations to Adjusted Operating Income (Three Months Ended June 30) | ($ in thousands) | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Income from operations | $5,492 | $21,147 | | Add back (deduct): | | | | Acquisition deal and integration costs | 8,103 | — | | Business realignment costs | 2,525 | 850 | | Factory and warehouse consolidation costs | 482 | — | | Headquarter relocation costs | — | 96 | | Monterrey, MX new factory start-up costs | 1,901 | 3,566 | | Adjusted Operating Income | $18,503 | $25,659 | | Operating margin | 2.3 % | 8.8 % | | Adjusted Operating Margin | 7.8 % | 10.7 % | [Adjusted Net Income & EPS Reconciliation](index=12&type=section&id=Reconciliation%20of%20Net%20Income%20and%20Diluted%20Earnings%20per%20Share%20to%20Adjusted%20Net%20Income%20and%20Adjusted%20Earnings%20per%20Share) This reconciliation details the adjustments made to GAAP net income and diluted EPS to arrive at the non-GAAP adjusted net income and adjusted EPS for the quarter Reconciliation of Net Income and Diluted EPS to Adjusted Net Income and Adjusted EPS (Three Months Ended June 30) | ($ in thousands, except per share data) | June 30, 2025 | June 30, 2024 | | :------------------------------------------ | :------------ | :------------ | | Net income (loss) | $(1,898) | $8,629 | | Add back (deduct): | | | | Amortization of intangibles | 7,635 | 7,500 | | Acquisition deal and integration costs | 8,103 | — | | Business realignment costs | 2,525 | 850 | | Factory and warehouse consolidation costs | 482 | — | | Headquarter relocation costs | — | 96 | | Monterrey, MX new factory start-up costs | 1,901 | 3,566 | | Normalize tax rate | (4,492) | (2,595) | | Adjusted Net Income | $14,256 | $18,046 | | GAAP average diluted shares outstanding | 28,658 | 29,127 | | Add back: Effect of dilutive share-based awards | 120 | — | | Adjusted Diluted Shares Outstanding | $28,778 | $29,127 | | GAAP EPS | $(0.07) | $0.30 | | Adjusted EPS | $0.50 | $0.62 | [Adjusted EBITDA Reconciliation](index=13&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20EBITDA) This reconciliation details the adjustments made to GAAP net income to arrive at the non-GAAP adjusted EBITDA for the quarter Reconciliation of Net Income to Adjusted EBITDA (Three Months Ended June 30) | ($ in thousands) | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Net income (loss) | $(1,898) | $8,629 | | Add back (deduct): | | | | Income tax expense (benefit) | 260 | 3,421 | | Interest and debt expense | 8,698 | 8,235 | | Investment (income) loss | (1,049) | (209) | | Foreign currency exchange (gain) loss | (342) | 395 | | Other (income) expense, net | (177) | 676 | | Depreciation and amortization expense | 12,266 | 11,840 | | Acquisition deal and integration costs | 8,103 | — | | Business realignment costs | 2,525 | 850 | | Factory and warehouse consolidation costs | 482 | — | | Headquarter relocation costs | — | 96 | | Monterrey, MX new factory start-up costs | 1,901 | 3,566 | | Adjusted EBITDA | $30,769 | $37,499 | | Net income margin | (0.8)% | 3.6 % | | Adjusted EBITDA Margin | 13.0 % | 15.6 % |

Core Insights - Columbus McKinnon Corporation reported a net sales decrease of $3.8 million, or 1.6%, for the first quarter of fiscal year 2026 compared to the prior year, with net sales totaling $235.9 million [2][4] - The company experienced a net loss of $1.9 million, reflecting a net loss margin of (0.8%), which includes $8.1 million in acquisition-related expenses and $4.2 million in tariff impacts [4][5] - The backlog increased by 23% year-over-year to $360.1 million, indicating a healthy demand environment with a book-to-bill ratio of 1.1x [4][26] Financial Performance - Net sales for Q1 FY26 were $235.9 million, down from $239.7 million in Q1 FY25, with U.S. sales slightly declining by 0.7% and non-U.S. sales decreasing by 2.7% [2][4] - Gross profit fell to $77.2 million, a decrease of 13.3% from $89.0 million in the prior year, resulting in a gross margin of 32.7% [3][4] - Adjusted EBITDA for the quarter was $30.8 million, down 17.9% from $37.5 million in the previous year, with an adjusted EBITDA margin of 13.0% [5][39] Operational Highlights - The company anticipates a net tariff impact of approximately $10 million in the first half of fiscal 2026, consistent with prior guidance [1][4] - Columbus McKinnon is progressing towards the acquisition of Kito Crosby, expecting benefits from scale, improved solutions, and realization of synergies [1][4] - Capital allocation priorities include paying down debt while maintaining consistent dividend payments, with a focus on advancing the Intelligent Motion strategy [6][8] Guidance and Outlook - The company reaffirms its fiscal year 2026 guidance, expecting net sales and adjusted EPS to be flat to slightly up, while factoring in approximately $35 million of interest expense and $30 million of amortization [7][8] - The guidance does not account for the pending Kito Crosby acquisition and reflects the current understanding of the volatile tariff policy environment [7][8]

Company Overview - Columbus McKinnon Corporation is a leading designer, manufacturer, and marketer of intelligent motion solutions for material handling [3] - The company focuses on commercial and industrial applications that require safety and quality through superior design and engineering [3] Upcoming Financial Results - Columbus McKinnon will release its first quarter fiscal 2026 results before the market opens on July 30, 2025 [1] - Management will host a conference call at 10:00 a.m. Eastern Time to review financial and operating results and discuss corporate strategy and outlook [2] Conference Call Details - The conference call will be available via live webcast on the company's Investor Relations webpage [2] - A replay of the call will be accessible approximately two hours after the call, available until August 13, 2025 [2]

Core Insights - Columbus McKinnon Corporation published its fifth annual Corporate Sustainability Report, emphasizing its commitment to environmental stewardship, social responsibility, and governance [1][2] - The company aims to strengthen its business through a focused sustainability strategy that aligns with its operational goals, enhancing financial results and long-term value while reducing environmental impacts [2] Sustainability Achievements - Significant progress in emissions reduction, particularly in Scope 1 and Scope 2 emissions intensity [5] - Ongoing initiatives in recycling and waste reduction [5] - Enhanced role of global Green Teams in educating employees and implementing carbon footprint mitigation strategies [5] Employee Engagement and Development - Increased focus on professional development and employee engagement to support growth strategies [5] Regulatory Preparedness - Proactive measures taken in anticipation of the European Union Corporate Sustainability Reporting Directive [5]

Core Viewpoint - The global rigging hardware market is projected to reach a size of $565.84 million by 2031, with a compound annual growth rate (CAGR) of 3.08% in the coming years [1]. Market Overview - Rigging hardware refers to tools and components used for lifting, securing, and moving heavy objects, playing a crucial role in construction, shipping, transportation, and entertainment industries [1]. - Common rigging hardware includes shackles, hooks, basket screws, eye bolts, and turnbuckles, designed to withstand significant loads and ensure safety during lifting operations [1]. Market Size and Growth - According to QYResearch, the global rigging hardware market is expected to grow steadily, with a projected market size of $565.84 million by 2031 and a CAGR of 3.08% [1]. Major Manufacturers - Key global manufacturers of rigging hardware include Kito Crosby, Columbus McKinnon, Giant Rigging, Konecranes, and Henan Weihu Heavy Machinery, with the top five companies holding approximately 37.64% of the market share [7]. Driving Factors - The demand for high-performance rigging hardware is driven by global industrial modernization and the expansion of large infrastructure projects, particularly in mining, energy, shipping, and construction sectors [8]. - Continuous upgrades in global safety standards further accelerate the demand for high-quality rigging products [8]. Restraining Factors - Fluctuations in steel and high-performance alloy prices significantly impact manufacturing costs and product price stability [9]. - Intense price competition among numerous industry participants limits profit margins [9]. - Issues such as fatigue damage, corrosion, and wear during long-term use necessitate regular maintenance and replacement of products [9]. Industry Development Opportunities - The rigging hardware market is increasingly adopting high-strength alloys and composite materials to meet higher safety standards and improve operational efficiency [10]. - Advances in Industry 4.0 and smart manufacturing are driving the integration of smart sensors and remote monitoring systems for real-time status tracking and fault warning [10]. - Automation and mechanization are becoming more prevalent through the use of automated lifting and handling equipment, reducing manual labor while enhancing efficiency and safety [10]. - There is a growing demand for customized rigging solutions tailored to specific industries and applications, promoting the rise of small-batch and diversified production [10].

Company Overview - Columbus McKinnon (CMCO) is a global leader in intelligent motion solutions for material handling, with a 150-year history[9] - The company estimates a total addressable market of $20 billion[9, 23] - CMCO's net sales are approximately $1 billion, with a 5-year sales growth CAGR of around 4%[9] - Adjusted EBITDA margin is approximately 16%, and free cash flow conversion is greater than 100%[9] - Revenue mix: Lifting Solutions accounts for 62%, Specialty Conveying 16%, Automation 13%, and Linear Motion 9%[7] Kito Crosby Acquisition - CMCO announced the acquisition of Kito Crosby for $2.7 billion[28] - Kito Crosby has approximately $1.1 billion in 2024 revenue, with a 7% revenue CAGR from 2021-2024[31] - Kito Crosby's revenue mix: Lifting & Securement Consumables 54%, Installed Lifting Solutions 32%, and Technology & Specialty Solutions 14%[34] - The acquisition is expected to more than double the size of the company, with a 23% Adjusted EBITDA Margin[43] - The company expects to close the acquisition in late 2025[45] Synergies and Financials - The company anticipates approximately $80 million in pre-tax run-rate cost synergies from the Kito Crosby acquisition[48] - The company expects to offset approximately $40 million EBITDA impact from tariffs through mitigation actions by H2 FY26[58]

Summary of Columbus McKinnon Conference Call Company Overview - Columbus McKinnon is a global leader in intelligent motion solutions for material handling with over 150 years of history and public since 1996 [2][3] - The company generates approximately $1 billion in sales with a 16% EBITDA margin, with 60% of business in North America and 30% in EMEA [4] Business Segments - The company operates in four main platforms: - Lifting (60% of revenue) providing hoists and rigging materials [5] - Precision conveyance, enhanced through acquisitions like Dorner and Garvey [6] - Automation, stemming from the Magnetek acquisition [6] - Linear motion, representing 9% of the company [7] Growth Strategy - Columbus McKinnon is focused on growth and margin expansion through strategic acquisitions and entering secular growth categories [3][12] - Recent acquisitions include: - Keto Crosby for $2.7 billion, expected to close by the end of the calendar year [10][19] - Dorner Corporation for $485 million, enhancing precision conveyance capabilities [12] - Garvey Corporation and Montrotech, expanding automation and precision handling [16][18] Financial Performance and Projections - The acquisition of Keto Crosby is expected to double the company's size and triple EBITDA, with a projected EBITDA margin of 23% [27] - Anticipated net synergies of $70 million from the acquisition, with significant free cash flow generation expected [28][39] - The company aims to reduce net leverage to about 3x within two years [40] Market Dynamics - The company is experiencing strong demand in sectors such as battery production, e-commerce, life sciences, food and beverage, and aerospace [58][61][63] - Challenges include tariff impacts, with a potential $10 million headwind expected in the current fiscal year [43][45] - Short cycle orders have been weaker, but project business is growing, indicating a shift in demand profiles [50][54] Competitive Landscape - The industry has shown rational pricing behavior in response to inflation and tariffs, with Columbus McKinnon implementing pricing actions to mitigate tariff impacts [47][49] - The company is well-positioned to leverage its global presence and expertise in various markets, including defense and energy [68] Conclusion - The Keto Crosby acquisition is viewed as a transformative opportunity, enhancing scale and operational capabilities while allowing Columbus McKinnon to continue its strategic focus on intelligent motion solutions [70][71]