Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Management's Discussion and Analysis ofFinancial Condition and Results of Operations

The following Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2024, including the financial statements, accompanying notes and Management's Discussion and Analysis of Financial Condition and Results of Operations therein, and the interim condensed consolidated financial statements and accompanying notes included in this Quarterly Report on Form 10-Q.

All dollar amounts are in millions throughout the tables included in Management's Discussion and Analysis of Financial Condition and Results of Operations unless otherwise indicated.

Cautionary Statements Regarding Forward-Looking Information

All of the statements in this Quarterly Report on Form 10-Q, other than historical facts, are forward-looking statements, including, without limitation, the statements made in the "Management's Discussion and Analysis of Financial Condition and Results of Operations." As a general matter, forward-looking statements are those focused upon anticipated events or trends, expectations and beliefs relating to matters that are not historical in nature. The words "could," "should," "may," "feel," "anticipate," "aim," "preliminary," "expect," "believe," "estimate," "intend," "intent," "plan," "will," "foresee," "project," "forecast," or the negative thereof or variations thereon, and similar expressions identify forward-looking statements.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for these forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that forward-looking statements are subject to known and unknown risks, uncertainties and other factors relating to the Company's operations and business environment, all of which are difficult to predict and many of which are beyond the control of the Company. These known and unknown risks, uncertainties and other factors could cause actual results to differ materially from those matters expressed in, anticipated by or implied by such forward-looking statements. These risks, uncertainties, and other factors include, but are not limited to:

These statements reflect the current views and assumptions of management with respect to future events. Except to the extent required by the federal securities laws, the Company does not undertake, and hereby disclaims, any duty to update these forward-looking statements, even though its situation and circumstances may change in the future. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this report. The inclusion of any statement in this report does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.

Current Events

As disclosed in Part I, Item 1A: Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, the Company's business is subject to risks related to, among other factors, tariffs and other trade protection measures put in place by the United States or other countries, as well as U.S. international trade relations, including those with China and the European Union.

As of September 30, 2025, the U.S. has implemented country-specific trade agreements with key partners including the European Union, Japan, and the United Kingdom, featuring modified tariff structures and industry-specific exemptions. The U.S. continues to negotiate trade agreements with other countries, including China, which currently have varying reciprocal tariffs. In addition, the U.S. government imposed 50% tariffs on new steel and aluminum derivative products which include certain of the Company's crane models. These tariffs apply to imports from nearly all countries, with the UK subject to a reduced 25% rate.

Approximately 50% of the Company's total net sales are generated in the United States. While the majority of the Company's products are manufactured domestically, the evolving tariff landscape has and could continue to:

The Company continues to monitor developments closely, including pending legal challenges to certain tariff authorities and ongoing negotiations with additional trade partners. Considerable uncertainty remains regarding industry-specific exemptions, retaliatory measures, and the final resolution of trade agreements. The Company is actively assessing the potential impact of such tariffs, developments, measures and agreements and evaluating potential mitigation strategies, including supply chain adjustments, pricing strategies, and sourcing diversification.

Orders and Backlog

Orders and backlog are not measures defined by GAAP and our methodology for determining orders and backlog may vary from the methodology used by other companies. Management uses orders and backlog for capacity and resource planning. The Company believes this information is useful to investors to provide an indication of future revenues. Backlog represents the dollar value of orders which are expected to be recognized in net sales in the future. Orders are included in backlog when an executed binding contract with a price that has a floor has been received but has not been recognized in net sales.

Orders for the three months ended September 30, 2025 increased 15.7% to $491.4 million from $424.7 million for the same period in 2024. The increase was primarily attributable to higher orders in the Americas segment and for tower product offerings in the EURAF segment. Orders were favorably impacted by $10.3 million from changes in foreign currency exchange rates.

Orders for the nine months ended September 30, 2025 increased 10.5% to $1,555.6 million from $1,407.2 million for the same period in 2024. The increase was primarily attributable to higher orders in the Americas segment and for tower product offerings in the EURAF segment. Orders were favorably impacted by $13.0 million from changes in foreign currency exchange rates.

As of September 30, 2025, total backlog was $666.5 million, an increase of 2.5% from the December 31, 2024 backlog of $650.2 million, and a decrease of 10.2% from the September 30, 2024 backlog of $742.1 million. Backlog was favorably impacted from changes in foreign currency exchange rates by $27.4 million and $11.5 million from December 31, 2024 and September 30, 2024, respectively.

Results of Operations For the Three and Nine Months Ended September 30, 2025 and 2024:

Net Sales

Consolidated net sales for the three months ended September 30, 2025 increased 5.4% to $553.4 million from $524.8 million in the same period in 2024. This increase was primarily attributable to $17.5 million of higher new machine sales in the Company's tower product line in the EURAF segment, $7.0 million of higher new machine sales in the Americas segment primarily due to favorable product mix, and $8.3 million of higher non-new machine sales. This was partially offset by $13.2 million of lower new machine sales in the MEAP segment primarily due to unfavorable product mix. Net sales were favorably impacted by $11.2 million from changes in foreign currency exchange rates.

Consolidated net sales for the nine months ended September 30, 2025 decreased 1.2% to $1,563.8 million from $1,582.0 million for the same period in 2024. This decrease was primarily attributable to $40.0 million of lower new machine sales in the Company's mobile product line in the EURAF segment due to lower crane shipments, $37.5 million of lower new machine sales in the MEAP segment due to unfavorable product mix, and $10.7 million of lower new machine sales in the Americas segment due to lower crane shipments and unfavorable product mix. This was partially offset by $32.0 million of higher new machine sales in the Company's tower crane product line in the EURAF segment and $37.9 million of higher non-new machine sales primarily in the Americas and EURAF segments. Net sales were favorably impacted by $13.8 million from changes in foreign currency exchange rates.

Gross Profit

Gross profit for the three months ended September 30, 2025 increased 17.1% to $102.6 million as compared to $87.6 million for the same period in 2024. The increase was primarily due to the higher net sales and favorable product mix, partially offset by lower absorbed costs due to lower manufacturing volume in the Americas segment. Gross profit was favorably impacted by $2.0 million from changes in foreign currency exchange rates.

Gross profit percentage for the three months ended September 30, 2025 increased 180 basis points to 18.5% as compared to 16.7% for the same period in 2024. The increase was primarily due to favorable product mix, partially offset by lower absorbed costs due to lower manufacturing volume in the Americas segment.

Gross profit for the nine months ended September 30, 2025 increased 4.1% to $291.4 million from $279.8 million for the same period in 2024. The increase was primarily attributable to favorable product mix. This was partially offset by lower net sales and lower absorbed costs due to lower manufacturing volume in the Americas segment. Gross profit was favorably impacted by $2.7 million from changes in foreign currency exchange rates.

Gross profit percentage for the nine months ended September 30, 2025 increased 90 basis points to 18.6% from 17.7% for the same period in 2024. The increase was primarily due to favorable product mix, partially offset by lower absorbed costs due to lower manufacturing volume in the Americas segment.

Engineering, Selling, and Administrative Expenses

Engineering, selling, and administrative expenses for the three months ended September 30, 2025 increased 5.7% to $83.4 million from $78.9 million for the same period in 2024. The increase was primarily due to higher new product development costs. This was partially offset by a $2.6 million charge related to a legal matter with the U.S. Environmental Protection Agency ("EPA") in the prior year. Engineering, selling, and administrative expenses were unfavorably impacted by $2.0 million from changes in foreign currency exchange rates.

Engineering, selling and administrative expenses for the nine months ended September 30, 2025 increased 6.3% to $253.7 million from $238.6 million for the same period in 2024. The increase was primarily due to costs for the triennial bauma trade show, higher employee related costs, and higher new product development costs. This was partially offset by a $2.9 million charge related to a legal matter with the EPA in the prior year. Engineering, selling, and administrative expenses were unfavorably impacted by $2.4 million from changes in foreign currency exchange rates.

Interest Expense

Interest expense for the three months ended September 30, 2025 was $9.8 million as compared to $9.6 million for the same period in 2024. Interest expense increased year-over-year primarily due to higher outstanding balances on the Company's other credit facilities. This was partially offset by lower interest rates on borrowings under the Company's ABL Revolving Credit Facility. See further detail at Note 11, "Debt" to the Condensed Consolidated Financial Statements.

Interest expense for the nine months ended September 30, 2025 was $27.7 million as compared to $28.4 million for the same period in 2024. Interest expense decreased year-over-year primarily due to lower interest rates on borrowings under the

Company's ABL Revolving Credit Facility. This was partially offset by higher outstanding balances on the Company's other credit facilities. See further detail at Note 11, "Debt" to the Condensed Consolidated Financial Statements.

Other Expense - Net

Other expense - net was $0.8 million during the three months ended September 30, 2025 and $4.9 million for the same period in 2024. Other expense - net during the three months ended September 30, 2025 was primarily composed of $0.5 million of pension related costs and $0.2 million of net currency losses. Other expense - net during the three months ended September 30, 2024 was primarily composed of $3.2 million of net currency losses and $1.1 million of non-cash losses associated with the refinancing of the Company's 2026 Notes.

Other expense - net was $4.8 million during the nine months ended September 30, 2025 and $3.9 million for the same period in 2024. Other expense- net during the nine months ended September 30, 2025 was primarily composed of $3.1 million of net currency losses, $1.2 million of pension related costs, and $0.6 million of interest related to settlement of the matter with the EPA. This was partially offset by $1.0 million of interest income. Other expense - net during the nine months ended September 30, 2024 was primarily composed of $2.2 million of pension related costs, $1.4 million of net currency losses, and $1.1 million of non-cash losses associated with the refinancing of the Company's 2026 Notes, partially offset by $0.7 million of interest income.

Provision (Benefit) for Income Taxes

For the three months ended September 30, 2025, and 2024, the Company recorded a provision for income taxes of $2.5 million and a benefit for income taxes of $0.3 million, respectively. Changes to jurisdictional mix and year-to-date income before income taxes resulted in a provision for income taxes compared to the prior year's benefit for income taxes. For the nine months ended September 30, 2025 and 2024, the Company recorded a benefit for income taxes of $0.2 million and a provision for income taxes of $3.2 million, respectively. During the nine months ended September 30, 2025 and 2024, the Company recorded a discrete net tax benefit of $0.5 million and a discrete net tax expense of $2.2 million, respectively. The change in discrete taxes along with lower year-to-date income before taxes resulted in a benefit for income taxes for the nine months ended September 30, 2025, compared to the prior year's provision for income taxes. In addition, the Company's effective tax rate varies from the U.S. federal statutory rate of 21% due to results of foreign operations that are subject to income taxes at different statutory rates and losses in certain jurisdictions where no tax benefit can be realized.

Segment Operating Performance

The Company manages its business primarily on a geographic basis. The Company has three reportable segments: the Americas segment, EURAF segment and MEAP segment. Further information regarding the Company's reportable segments can be found in Note 17, "Segments," to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Americas

Americas segment net sales increased 6.7% for the three months ended September 30, 2025 to $306.4 million from $287.1 million for the same period in 2024. The increase was primarily attributable to $12.3 million of higher non-new machine sales, partially offset by lower new crane shipments.

Americas segment operating income increased $2.3 million for the three months ended September 30, 2025 to $25.5 million from $23.2 million for the same period in 2024. The increase was primarily attributable to higher net sales and favorable product mix. This was partially offset by lower absorbed costs due to lower manufacturing volume.

Americas segment net sales increased $21.9 million for the nine months ended September 30, 2025 to $888.9 million as compared to $867.0 million for the same period in 2024. The increase was primarily attributable to $32.6 million of higher non-new machine sales, partially offset by a $10.7 million decrease of new machine sales due to lower crane shipments.

Americas segment operating income decreased $7.3 million for the nine months ended September 30, 2025 to $69.3 million from $76.6 million for the same period in 2024. The decrease was primarily attributable lower absorbed costs due to lower manufacturing volume, partially offset by favorable product mix.

EURAF

EURAF segment net sales increased 28.7% for the three months ended September 30, 2025 to $163.2 million from $126.8 million for the same period in 2024. The increase was primarily attributable to $17.5 million of higher tower crane sales and $9.8 million of higher non-new machine sales. Segment net sales were favorably impacted by $9.3 million from changes in foreign currency exchange rates.

EURAF segment operating loss increased $4.7 million for the three months ended September 30, 2025 to $10.2 million from $14.9 million for the same period in 2024. The increase in operating loss was primarily attributable to higher engineering, selling, and administrative costs partially offset by higher net sales. Segment operating income was unfavorably impacted by $0.6 million from changes in foreign currency exchange rates.

EURAF segment net sales increased 3.4% for the nine months ended September 30, 2025 to $461.3 million from $446.0 million for the same period in 2024. The increase was primarily attributable to $32.0 million of higher new machine sales related to higher tower crane shipments and $23.2 million of higher non-new machine sales. This was partially offset by $40.0 million of lower new machine sales related to lower mobile crane shipments. Segment net sales were favorably impacted by $14.0 million from changes in foreign currency exchange rates.

EURAF segment operating loss increased $2.6 million for the nine months ended September 30, 2025 to $36.1 million from $33.5 million for the same period in 2024. The increase in operating loss was primarily attributable to higher engineering, selling and administrative expenses due to the triennial bauma trade show and higher new product development costs, partially offset by higher net sales. Segment operating loss was unfavorably impacted by $0.9 million from changes in foreign currency exchange rates.

MEAP

MEAP segment net sales decreased 24.4% for the three months ended September 30, 2025 to $83.8 million from $110.9 million for the same period in 2024. The decrease was primarily attributable to $13.2 million of lower new machine sales due to unfavorable product mix and $13.8 million of lower non-new machine sales. Segment net sales were favorably impacted by $1.8 million from changes in foreign currency exchange rates.

MEAP segment operating income increased $3.0 million for the three months ended September 30, 2025 to $13.0 million compared to $10.0 million for the same period in 2024, primarily due to higher absorbed costs due to higher manufacturing volume and favorable product mix. Segment operating income was favorably impacted by $0.3 million from changes in foreign currency exchange rates.

MEAP segment net sales decreased 20.6% for the nine months ended September 30, 2025 to $213.6 million from $269.0 million for the same period in 2024. The decrease was primarily attributable to $37.5 million of lower new machine sales due to unfavorable product mix and $17.9 million of lower non-new machine sales. Segment net sales were favorably impacted by $0.3 million from changes in foreign currency exchange rates.

MEAP segment operating income increased $6.7 million for the nine months ended September 30, 2025 to $34.2 million from $27.5 million for the same period in 2024. The increase was primarily due to higher absorbed costs due to higher manufacturing volume. Segment operating income was favorably impacted by $0.1 million from changes in foreign currency exchange rates.

Financial Condition

Cash Flows

A summary of cash flows for the nine months ended September 30, 2025 and 2024 are as follows:

Cash Flows From Operating Activities

Cash flows used for operating activities of $68.9 million for the nine months ended September 30, 2025 increased $5.7 million from $63.2 million for the same period in 2024. The increase in net cash used for operating activities was primarily driven by a $43.2 million payment to settle a legal matter with the EPA. This was partially offset by $38.4 million of lower cash used for other operating assets and liabilities.

Cash Flows From Investing Activities

Net cash used for investing activities of $37.1 million for the nine months ended September 30, 2025 increased $8.0 million from $29.1 million for the same period in 2024. The increase in net cash used for investing activities was primarily due to $12.9 million of cash outflows related to the purchase of certain assets and territory from Ring Power Corporation and $4.8 million of lower proceeds from the sale of property, plant, and equipment. This was partially offset by $9.7 million of lower capital expenditures.

Cash Flows From Financing Activities

Net cash provided by financing activities of $95.9 million for the nine months ended September 30, 2025 increased $14.9 million from $81.0 million for the same period in 2024. The increase in net cash provided by financing activities was primarily due to $24.8 million of additional net borrowings under the ABL Revolving Credit Facility, $6.2 million of cash outflows related to debt issuance costs in 2024, and $5.7 million of cash outflows related to common stock repurchases in 2024. This was partially offset by $23.9 million of lower proceeds from other debt - net.

Liquidity and Capital Resources

The Company's liquidity position as of September 30, 2025, December 31, 2024 and September 30, 2024 is summarized as follows:

The Company believes its liquidity and expected cash flows from operations are sufficient to meet expected working capital, capital expenditure, and other general ongoing operational needs in the subsequent twelve months.

Cash Sources

The Company has historically relied primarily on cash flows from operations, borrowings under revolving credit facilities and overdraft facilities, issuances of notes, and other forms of debt financing as its sources of cash.

The maximum availability under the Company's current ABL Revolving Credit Facility is $325.0 million, of which $100.0 million is available to our German subsidiary. The borrowing capacity under the ABL Revolving Credit Facility is based on the value of inventory, accounts receivable and certain fixed assets of the Loan Parties. The Loan Parties' obligations under the ABL Revolving Credit Facility are secured on a first-priority basis, subject to certain exceptions and permitted liens, by substantially all the personal property and fee-owned real property of the Loan Parties. The liens securing the ABL Revolving Credit Facility are senior in priority to the second-priority liens securing the obligations under the 2031 Notes and the related guarantees. The ABL Revolving Credit Facility has a maturity date of September 18, 2029, and includes a $75.0 million letter of credit sub-facility, $10.0 million of which is available to the Company's German subsidiary that is a borrower under this facility.

In addition to the ABL Revolving Credit Facility, the Company has access to committed and non-committed lines of credit to fund working capital in Europe and China. There are six facilities, of which five facilities are denominated in Euros totaling €37.0 million and one facility denominated in Chinese Yuan totaling ¥30.0 million. Total U.S. dollar availability as of September 30, 2025 for the six facilities was $47.6 million, with $19.0 million outstanding.

Debt

Outstanding debt as of September 30, 2025 and December 31, 2024 is summarized as follows:

Both the ABL Revolving Credit Facility and 2031 Notes include customary covenants and events of default. Refer to Note 11, "Debt," to the Condensed Consolidated Financial Statements for additional discussions of covenants under the ABL Revolving Credit Facility and 2031 Notes. As of September 30, 2025, the Company was in compliance with all affirmative and negative covenants in its debt instruments, inclusive of the financial covenants pertaining to the ABL Revolving Credit Facility and 2031 Notes. Based upon management's current plans and outlook, the Company believes it will be able to comply with these covenants during the subsequent twelve months. From time to time, the Company seeks to opportunistically raise capital in the debt capital markets and bank credit markets.

Non-GAAP Measures

The Company uses EBITDA, adjusted EBITDA, adjusted operating income, Adjusted ROIC and free cash flows, which are financial measures that are not prepared in accordance with GAAP, as additional metrics to evaluate the Company's performance. The Company believes these non-GAAP measures provide important supplemental information to readers regarding business trends that can be used in evaluating its results because these financial measures provide a consistent method of comparing financial performance and are commonly used by investors to assess performance. These non-GAAP financial measures should be considered together with, and are not substitutes for, the GAAP financial information provided herein.

Adjusted ROIC

Adjusted ROIC measures how efficiently the Company uses invested capital in its operations. Adjusted ROIC is not a measure defined by GAAP and the Company's methodology for determining Adjusted ROIC may vary from the methodology used by other companies. Management and the Board of Directors use Adjusted ROIC as a measure to assess operational performance and capital allocation. The Company believes this information is useful to investors as it provides a measure of value creation as a percentage of capital invested.

Adjusted ROIC is determined by dividing adjusted net operating profit after tax ("Adjusted NOPAT") for the trailing twelve-months by the five-quarter average of invested capital. Adjusted NOPAT is calculated for each quarter by taking operating income plus the addback of amortization of intangible assets, and the addback or subtraction of restructuring expenses, other non-recurring items - net, and provision for income taxes, which is determined using a 15% tax rate. Invested capital is defined

as net total assets less cash and cash equivalents and income tax assets - net plus short-term and long-term debt. Income taxes are defined as income tax payables/receivables, net deferred tax assets/liabilities, and uncertain tax positions.

The Company's Adjusted ROIC as of September 30, 2025 was 4.8%. Below is the calculation of Adjusted ROIC as of September 30, 2025.

(1) Other non-recurring items - net for the three months ended December 31, 2024 and the trailing twelve months relate to $1.0 million of costs associated with a legal matter with the EPA.

EBITDA and Adjusted EBITDA

The Company defines EBITDA as net income (loss) before interest, taxes, depreciation, and amortization. The Company defines adjusted EBITDA as EBITDA plus the addback or subtraction of restructuring expense, other expense - net, and certain other non-recurring items.

The reconciliation of net income (loss) to EBITDA, and further to adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024 and trailing twelve months is summarized as follows.

Free Cash Flows

Free cash flows is defined as net cash used for operating activities less cash outflow from investment in capital expenditures. The reconciliation of net cash used for operating activities to free cash flows for the nine months ended September 30, 2025 and 2024 is summarized as follows.

Critical Accounting Policies

The Company's critical accounting policies have not materially changed since the 2024 Annual Report on Form 10-K was filed. Refer to the Critical Accounting Policies in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Annual Report on Form 10-K for the year ended December 31, 2024 for information about the Company's policies, methodology and assumptions related to critical accounting policies.