NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1.ORGANIZATION AND OPERATIONS AND SUMMARY OF ACCOUNTING POLICIES
CSW Industrials, Inc. (the “Company,” “CSW,” “we,” “our” or “us”) is a diversified industrial growth company with a strategic focus on providing niche, value-added products in the end markets we serve. We operate in three business segments: Contractor Solutions, Specialized Reliability Solutions and Engineered Building Solutions. Our products include mechanical products for heating, ventilation, air conditioning and refrigeration (“HVAC/R”), plumbing products, grilles, registers and diffusers (“GRD”), building safety solutions and high-performance specialty lubricants and sealants. End markets that we serve include HVAC/R, architecturally-specified building products, plumbing, electrical, general industrial, energy, rail transportation and mining. Our manufacturing operations are concentrated in the United States (“U.S.”), Vietnam and Canada, and we have distribution operations in the U.S., Australia, Canada and the United Kingdom (“U.K.”). Our products are sold directly to end users or through designated channels in over 100 countries around the world, primarily including the U.S., Canada, the U.K. and Australia.
Drawing on our innovative and proven technologies, we seek to deliver solutions primarily to contractors that place a premium on superior performance and reliability. We believe our brands are well-known in the specific end markets we serve and have a reputation for high quality. We rely on both organic growth and inorganic growth through acquisitions to provide an increasingly broad portfolio of performance optimizing solutions that meet our customers’ ever-changing needs. We have a successful record of making attractive, synergistic acquisitions in support of this objective, and we remain focused on identifying additional acquisition opportunities in our core end markets.
Many of our products are used to protect the capital assets of our customers that are expensive to repair or replace and are critical to their operations. We have a source of recurring revenue from the maintenance, repair and overhaul and consumable nature of many of our products. We also provide some custom engineered products that strengthen and enhance our customer relationships. The reputation of our product portfolio is built on more than 100 well-respected brand names, such as AC Guard®, Air Sentry®, Aspen ManufacturingTM, Balco®, Cover Guard®, Deacon®, Dust Free®, Falcon Stainless®, Greco®, Hydrotex®, Jet-Lube®, Kopr-Kote®, Leak Freeze®, MARS®, Metacaulk®, No. 5®, OilSafe®, PF WaterWorksTM, ProAction Fluids®, PSP ProductsTM, RectorSeal®, Safe-T-Switch®, Shoemaker Manufacturing®, Smoke Guard®, TRUaire® and Whitmore®.
As of the date of this report, there continues to be uncertainty regarding overall macroeconomic conditions, including increased geopolitical tensions, risk of recessions, and the effects of potential trade policies including tariffs. In April 2025, the President of the United States issued an executive order to regulate imports by imposing country-specific tariffs on multiple nations around the world, including Vietnam and China, which are relevant to our business due to our manufacturing presence in Vietnam and our use of third-party manufacturing in China and other foreign countries. In addition, the United States imposed and/or reimposed certain commodity-specific tariffs, including tariffs on steel, aluminum and copper, which are used as inputs for some of our products. We have responded by negotiating cost reductions with certain suppliers, transitioning certain sources of supply, and by raising prices to our customers on certain products across our three segments to partially offset the impact. The current situation is dynamic, and the ultimate effect will be dependent on the magnitude and duration of the tariffs and the countries implicated, as well as our ability to mitigate their impact, where we continue to actively assess and implement mitigation options.
On June 9, 2025, we transferred the listing of our common stock from the Nasdaq Global Select Market to the New York Stock Exchange. Our common stock now trades on the New York Stock Exchange under the stock symbol “CSW”.
Basis of Presentation
The consolidated financial statements included in this Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2025 (“Quarterly Report”), include all revenues, costs, assets and liabilities directly attributable to CSW and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The consolidated financial statements are for us and our consolidated subsidiaries, each of which is a wholly-owned subsidiary, except our non-controlling 50% investment in a variable interest entity (“VIE”) for which we have determined that we are the primary beneficiary and therefore have consolidated into our financial statements. All significant intercompany transactions have been eliminated in consolidation.
The consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary to present a fair statement of CSW’s financial position as of December 31, 2025, and the results of operations for the nine month periods ended December 31, 2025 and 2024. All adjustments are of a normal, recurring nature.
The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in CSW’s Annual Report on Form 10-K for the fiscal year ended March 31, 2025 (the “Annual Report”).
Accounting Policies
We have consistently applied the accounting policies described in our Annual Report in preparing these consolidated financial statements.
Accounting Developments
Pronouncements not yet implemented
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which provides qualitative and quantitative updates to the rate reconciliation and income taxes paid disclosures, among others, in order to enhance the transparency of income tax disclosures, including consistent categories and greater disaggregation of information in the rate reconciliation and disaggregation by jurisdiction of income taxes paid. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. This ASU should be applied prospectively; however, retrospective application is also permitted. This ASU will be effective for our Form 10-K for fiscal 2026. We are currently evaluating the impact this ASU may have on our financial statement disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures. Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. This ASU provides guidance to expand disclosures related to the disaggregation of income statement expenses. Also, this ASU requires, in the notes to the financial statements, disclosure of specified information about certain costs and expenses which includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption. ASU 2025-01 is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, on a retrospective or prospective basis, with early adoption permitted. This ASU will be effective for our Form 10-K for fiscal 2028 and our Form 10-Q for the first quarter of 2029. We are currently evaluating the impact this ASU may have on our financial statement disclosures.
In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements, which includes amendments to more closely align hedge accounting with the economics of an entity’s risk management activities. ASU 2025-09 is effective for fiscal years beginning after December 15, 2027 with early adoption permitted should be applied prospectively. The amendments will be effective for our Form 10-K for fiscal 2029 and our Form 10-Q for the first quarter of 2029. We are currently evaluating the impact this ASU may have on our financial statement disclosures.
In December 2025, the FASB issued ASU 2025-11 to amend the guidance in Interim Reporting (Topic 270): Narrow-Scope Improvements. The update provides clarifications intended to improve the consistency and usability of interim disclosure requirements, including a comprehensive listing of required interim disclosures and a new disclosure principle for reporting material events occurring after the most recent annual period. The amendments do not change the underlying objectives of interim reporting but are designed to enhance clarity in application. The guidance is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years. This ASU will be effective for our Form 10-K for fiscal 2029 and our Form 10-Q for the first quarter of 2029. We are currently evaluating the impact this ASU may have on our financial statement disclosures.
In December 2025, the FASB issued ASU 2025-12 Codification Improvements to address suggestions received from stakeholders on the Accounting Standards Codification and to make other incremental improvements to U.S. GAAP. The update represents changes to the Codification that (1) clarify, (2) correct errors, or (3) make minor improvements. The amendments make the Codification easier to understand and apply. The guidance is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. This ASU will be effective for our Form 10-K for fiscal
2028 and our Form 10-Q for the first quarter of 2028. We do not expect the adoption to have a material impact on our financial statement disclosures.
2. ACQUISITIONS
Dusk Acquisition Corporation
On November 4, 2025, we acquired 100% of the equity interests of Dusk Acquisition Corporation and its wholly owned subsidiaries, Motors & Armatures Parts, LLC and HVAC South, LLC (collectively, “MARS Parts”), based in Hauppauge, New York, for an aggregate purchase price of $667.5 million (including $6.0 million cash acquired), comprised of cash consideration of $650.0 million, estimated cash on balance sheet at closing of $4.1 million, and contingent considerations initially measured at $13.4 million based on MARS Parts meeting defined financial targets over a period of one year. The cash consideration was funded with a combination of the TLA (as defined in Note 7) and borrowings under our existing Revolving Credit Facility (as defined in Note 7). As of the acquisition date, the estimated fair value of the contingent consideration was classified as a current liability of $13.4 million, which was determined using an option pricing model simulation that determines an average projected payment value across numerous iterations. MARS Parts is one of the largest providers of HVAC/R parts and supplies in North America, and a leading provider of motors and capacitors. With a product mix more heavily focused on repair versus replacement, we expect MARS Parts will strategically complement our current HVAC/R end market, which traditionally has been more focused on new unit installations and replacements.
The MARS Parts acquisition was accounted for as a business combination under FASB Accounting Standards Codification Topic 805, Business Combinations ("Topic 805"). Pursuant to Topic 805, the Company allocated the MARS Parts purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, November 4, 2025. The excess of the purchase price over those fair values was recorded to goodwill. The Company's evaluation of the facts and circumstances available as of November 4, 2025, to assign fair values to assets acquired and liabilities assumed, including income tax related amounts, is ongoing. The primary areas of preliminary purchase accounting price allocation subject to changes relate to the assumptions used in the valuation model, the valuation of working capitals and property, plant and equipment, and deferred tax balances. We expect to finalize the purchase price allocation as soon as practicable, but no later than one year from the acquisition date. The following table summarizes the Company's best initial estimate of the aggregate fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands).
| | | | | | | | | | | | |
| | Initial Estimated Fair Value | | | | |
| Cash | | $ | 5,973 | | | | | |
| Accounts Receivable | | 16,296 | | | | | |
| Inventory | | 54,520 | | | | | |
| Income Tax Receivable | | 1,934 | | | | | |
| Other Current Assets | | 1,606 | | | | | |
| Property, Plant and Equipment | | 6,644 | | | | | |
| Trade Name (indefinite life) | | 45,000 | | | | | |
Customer Lists (useful life of 15 years) | | 349,000 | | | | | |
| Right-Of-Use Assets | | 5,205 | | | | | |
| | | | | | |
| Other Long-Term Assets | | 635 | | | | | |
| Accounts Payable | | (7,645) | | | | | |
| Accrued and Other Current Liabilities | | (10,729) | | | | | |
| Lease Liabilities - Short-Term | | (1,341) | | | | | |
| | | | | | |
| Deferred Tax Liabilities | | (60,679) | | | | | |
| | | | | | |
| Lease Liabilities - Long-Term | | (3,864) | | | | | |
| | | | | | |
| Estimated fair value of net assets acquired | | 402,555 | | | | | |
| Goodwill | | 264,981 | | | | | |
| Total Purchase Price | | $ | 667,536 | | | | | |
Goodwill of $265.0 million represents the excess of the purchase price over the fair value of the underlying tangible and intangible assets acquired and liabilities assumed. The acquisition goodwill represents the value expected to be obtained from expanding the Company’s product offerings more broadly across the HVAC/R end market. The goodwill recorded as part of this acquisition is included in the Contractor Solutions segment. The Company has assumed the seller's tax basis in goodwill ($16.7 million) and intangible assets ($143.9 million), which will continue to be amortized over the remaining tax life of 14 years.
MARS Parts generated net revenue of $16.9 million and net loss before income taxes of $3.8 million for the period from the acquisition date to December 31, 2025, primarily driven by the expenses incurred to rapidly integrate the business post acquisition. MARS Parts activity is currently included in our Contractor Solutions segment. During the three and nine months ended December 31, 2025, the Company incurred $1.9 million and $3.4 million, respectively, of transaction expenses in connection with the MARS Parts acquisition. Transaction expenses are included in selling, general and administrative expenses in the Consolidated Statement of Operations under the Contractor Solutions and Other segments.
Aspen Manufacturing, LLC
On May 1, 2025, we acquired 100% of the equity interests of Aspen Manufacturing, LLC (“Aspen Manufacturing”), based in Humble, Texas, for an aggregate purchase price of $327.6 million (including $2.3 million cash acquired), comprised of cash consideration of $313.5 million and working capital adjustments of $14.1 million. The cash consideration was funded with cash on hand and borrowings under our existing Revolving Credit Facility (as defined in Note 7). Aspen Manufacturing is one of the largest independent evaporator coil and air handler manufacturers for the HVAC/R industry and is recognized as a leader in product quality and indoor comfort. Aspen Manufacturing’s current product suite includes a vast range of high-quality residential and light commercial evaporator coils, blowers, and air handling units for single-family, multi-family, and manufactured homes.
The Aspen Manufacturing acquisition was accounted for as a business combination under Topic 805. Pursuant to Topic 805, the Company allocated the Aspen Manufacturing purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, May 1, 2025. The excess of the purchase price over those fair values was recorded to goodwill. The Company's evaluation of the facts and circumstances available as of May 1, 2025, to assign fair values to assets acquired and liabilities assumed, including income tax related amounts, is ongoing. The primary areas of preliminary purchase accounting price allocation subject to changes relate to the valuation of working capitals, income tax contingency and related indemnification asset and value of property, plant and equipment. We expect to finalize the purchase price allocation as soon as practicable, but no later than one year from the acquisition date. The following table summarizes the Company's best initial estimate of the aggregate fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands).
| | | | | | | | | | | | | | | | | | | | |
| | Initial Estimated Fair Value | | Measurement Period Adjustments | | Updated Initial Estimated Fair Value |
| Cash | | $ | 2,289 | | | $ | — | | | $ | 2,289 | |
| Accounts Receivable | | 15,253 | | | (62) | | | 15,191 | |
| Inventory | | 30,851 | | | 311 | | | 31,162 | |
| | | | | | |
| Other Current Assets | | 150 | | | — | | | 150 | |
| Property, Plant and Equipment | | 7,916 | | | — | | | 7,916 | |
| Trade Name (indefinite life) | | 22,000 | | | — | | | 22,000 | |
Customer Lists (useful life of 15 years) | | 165,000 | | | — | | | 165,000 | |
| Right-Of-Use Assets | | 11,855 | | | — | | | 11,855 | |
| Long-Term Indemnity Asset | | 400 | | | — | | | 400 | |
| Other Long-Term Assets | | — | | | 1,789 | | | 1,789 | |
| Accounts Payable | | (5,459) | | | — | | | (5,459) | |
| Accrued and Other Current Liabilities | | (8,943) | | | (167) | | | (9,110) | |
| Lease Liabilities - Short-Term | | (1,019) | | | — | | | (1,019) | |
| | | | | | |
| | | | | | |
| Lease Liabilities - Long-Term | | (10,836) | | | — | | | (10,836) | |
| Contingency Reserve | | (400) | | | — | | | (400) | |
| Other Long-Term Liabilities | | (3,600) | | | — | | | (3,600) | |
| Estimated fair value of net assets acquired | | 225,457 | | | 1,871 | | | 227,328 | |
| Goodwill | | 100,421 | | | (177) | | | 100,244 | |
| Total Purchase Price | | $ | 325,878 | | | $ | 1,694 | | | $ | 327,572 | |
Goodwill of $100.2 million represents the excess of the purchase price over the fair value of the underlying tangible and intangible assets acquired and liabilities assumed. The acquisition goodwill represents the value expected to be obtained from expanding the Company’s product offerings more broadly across the HVAC/R end market. The goodwill recorded as part of this acquisition is included in the Contractor Solutions segment. The goodwill and all intangible assets are deductible and amortized over 15 years for income tax purposes.
Aspen Manufacturing generated net revenue of $108.0 million and net income before income taxes of $16.2 million for the period from the acquisition date to December 31, 2025. Aspen Manufacturing activity is currently included in our Contractor Solutions segment. During the year ended March 31, 2025, the Company incurred $1.1 million of transaction expenses in connection with the Aspen Manufacturing acquisition. During the three and nine months ended December 31, 2025, the Company incurred $0.0 million and $0.4 million, respectively, of transaction expenses in connection with the Aspen Manufacturing acquisition. Transaction expenses are included in selling, general and administrative expenses in the Consolidated Statement of Operations under the Contractor Solutions and Other segments.
Proforma Consolidated Financial Information
Pursuant to Topic 805, unaudited supplemental proforma results of operations for the three and nine months ended December 31, 2025 and 2024, as if the acquisitions of MARS Parts and Aspen Manufacturing had occurred on April 1, 2024, are presented below (in thousands, except per share amounts):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | Nine Months Ended December 31, |
| | 2025 | | 2024 | | 2025 | | 2024 |
| Revenue, net | | $ | 246,464 | | | $ | 253,677 | | | $ | 923,777 | | | $ | 906,799 | |
| Net income attributable to CSW | | 11,959 | | | 16,811 | | | 102,148 | | | 88,647 | |
| | | | | | | | |
| Net income per share attributable to CSW | | | | | | |
| Basic | | $ | 0.72 | | | $ | 1.00 | | | $ | 6.11 | | | $ | 5.52 | |
| Diluted | | $ | 0.72 | | | $ | 1.00 | | | $ | 6.09 | | | $ | 5.49 | |
These proforma results do not present financial results that would have been realized had the acquisition occurred on April 1, 2024, nor are they intended to be a projection of future results. The unaudited proforma results include certain proforma adjustments to net income that were directly attributable to the acquisition, as if the acquisition had occurred on April 1, 2024, including the following:
•Additional amortization expense of $1.9 million and $14.5 million for the three and nine months ended December 31, 2025, respectively, and $8.6 million and $25.7 million for the three and nine months ended December 31, 2024, respectively, that would have been recognized as a result of the allocation of purchase consideration to customer lists subject to amortization;
•Excluded amortization expense of $1.1 million and $2.9 million for the three and nine months ended December 31, 2025, respectively, and additional $0.0 million and $5.2 million to the three and nine months ended December 31, 2024, respectively, that would have been recognized as a result of the allocation of purchase consideration to acquisition inventory step-up;
•Additional depreciation expense of $0.0 million and $0.1 million for the three and nine months ended December 31, 2025, respectively, and $0.2 million and $0.5 million for the three and nine months ended December 31, 2024, respectively, that would have been recognized as a result of the fair value step-up of the property, plant and equipment;
•Additional representation and warranty insurance expense of $0.1 million and $0.5 million for the three and nine months ended December 31, 2025, respectively, and $0.3 million and $0.9 million for the three and nine months ended December 31, 2024, respectively;
•Excluded transaction expenses of $2.0 million and $3.9 million for the three and nine months ended December 31, 2025, and additional $0.0 million and $5.0 million for the three and nine months ended December 31, 2024, respectively, that would have been recognized;
•Estimated additional interest expense of $2.9 million and $20.8 million for the three and nine months ended December 31, 2025, respectively, and $13.0 million and $39.0 million for the three and nine months ended December 31, 2024, respectively, as a result of incurring additional borrowing;
•Estimated cost and operating expense savings of $0.4 million and $3.0 million for the three and nine months ended December 31, 2025, respectively, and $0.9 million and $2.6 million for the three and nine months ended December 31, 2024, respectively, as a result of management operational synergies; and
•Income tax benefit of the proforma adjustments, calculated using a blended statutory income tax rate of 25.0%, of $0.8 million and $7.4 million for the three and nine months ended December 31, 2025, respectively, and $5.3 million and $17.6 million for the three and nine months ended December 31, 2024, respectively.
ProAction Fluids, LLC
On November 20, 2025, we acquired certain assets of ProAction Fluids, LLC (“ProAction Fluids”), based in Shreveport, Louisiana for a cash consideration of $9.5 million, which was funded with borrowings under our existing Revolving Credit Facility (as defined in Note 7). ProAction Fluids offers performance-tested drilling fluids, lubricants, sealants, and compounds for the horizontal directional drilling ("HDD") market that expand upon, and are complimentary to, our existing general industrial product portfolio. During the nine months ended December 31, 2025, we incurred $0.1 million in transaction expenses in connection with the ProAction Fluids acquisition, which were included in selling, general and administrative expenses in the Consolidated Statements of Operations under the Specialized Reliability Solutions segment.
The ProAction Fluids acquisition was accounted for as a business combination under Topic 805. The excess of the purchase price over the preliminary fair value of the identifiable assets acquired and liabilities assumed was $6.8 million allocated to goodwill, which represents the value expected to be obtained from owning products that are expanding our existing general industrial offerings. The preliminary allocation of the fair value of the net assets acquired comprises customer lists ($1.4 million), trade name ($0.5 million), inventory ($0.7 million), and other assets ($0.1 million). Customer lists are being amortized over 15 years, while the trade name and goodwill are not being amortized. The Company’s evaluation of the facts and circumstances available as of November 20, 2025 to assign fair values to assets acquired is ongoing. The primary area of preliminary purchase price allocation subject to change relates to the assumptions used in the valuation model. We expect to finalize the purchase price allocation as soon as practicable, but no later than one year from the acquisition date. Goodwill and all intangible assets are deductible and amortized over 15 years for income tax purposes. ProAction Fluids activity has been included in our Specialized Reliability Solutions segment since the acquisition date.
The disclosure of ProAction Fluids' post-acquisition revenue and net income is not practical due to integration activities since the acquisition date. No pro forma information has been provided due to immateriality.
Hydrotex Holdings, Inc.
On November 5, 2025, we acquired certain assets of Hydrotex Holdings, Inc. (“Hydrotex”), based in Dallas, Texas for an aggregate purchase price of $17.0 million, comprised of cash considerations of $17.0 million and estimated working capital true-up adjustment of less than $0.1 million. The cash consideration was funded with borrowings under our existing Revolving Credit Facility (as defined in Note 7). Hydrotex offers high-performance lubricants designed to enhance operational efficiency, reduce equipment wear, and extend service life that expand upon, and are complimentary to, our existing general industrial products portfolio. During the nine months ended December 31, 2025, we incurred $0.5 million in transaction expenses in connection with the Hydrotex acquisition, which were included in selling, general and administrative expenses in the Consolidated Statements of Operations under the Specialized Reliability Solutions segment.
The Hydrotex acquisition was accounted for as a business combination under Topic 805. The excess of the purchase price over the preliminary fair value of the identifiable assets acquired and liabilities assumed was $2.8 million allocated to goodwill, which represents the value expected to be obtained from owning products that are expanding our existing general industrial offerings and provide additional drain lubricant solutions to our customers. The preliminary allocation of the fair value of the net assets acquired comprises customer lists ($7.6 million), trade name ($1.3 million), accounts receivable ($1.6 million), inventory ($3.5 million), other current assets ($0.1 million), and other assets ($0.9 million), net of current liabilities ($0.8 million). Customer lists are being amortized over 15 years, while the trade name and goodwill are not being amortized. The Company’s evaluation of the facts and circumstances available as of November 5, 2025 to assign fair values to assets acquired is ongoing. The primary area of preliminary purchase price allocation subject to change relates to the assumptions used in the valuation model and the valuation of working capital and property, plant and equipment. We expect to finalize the purchase price allocation as soon as practicable, but no later than one year from the acquisition date. Goodwill and all intangible assets are deductible and amortized over 15 years for income tax purposes. Hydrotex activity has been included in our Specialized Reliability Solutions segment since the acquisition date.
The disclosure of Hydrotex' post-acquisition revenue and net income is not practical due to integration activities since the acquisition date. No pro forma information has been provided due to immateriality.
PF WaterWorks, L.P.
On November 4, 2024, we acquired certain assets of PF WaterWorks, L.P. (“PF WaterWorks”), based in Houston, Texas for an aggregate purchase price of $45.8 million, comprised of cash considerations of $40.0 million, a working capital adjustment of $2.6 million and contingent considerations initially measured at $3.2 million based on PF WaterWorks meeting defined financial targets over a period of 3.2 years. The cash consideration was funded with cash on hand. PF WaterWorks offers innovative, eco-friendly drain management solutions that expand upon, and are complimentary to, our existing plumbing product portfolio. As of the acquisition date, the estimated fair value of the contingent consideration was classified as a long-term liability of $3.2 million, which was determined using an option pricing model simulation that determines an average projected payment value across numerous iterations. During the year ended March 31, 2025, we incurred $1.4 million in transaction expenses in connection with the PF WaterWorks acquisition, which were included in selling, general and administrative expenses in the Consolidated Statements of Operations under the Contractor Solutions segment. During the nine months ended December 31, 2025, no transaction expenses were incurred in connection with the PF WaterWorks acquisition.
The PF WaterWorks acquisition was accounted for as a business combination under Topic 805. The excess of the purchase price over the preliminary fair value of the identifiable assets acquired and liabilities assumed was $10.9 million allocated to goodwill, which represents the value expected to be obtained from owning products that are expanding our existing plumbing offerings and provide additional drain management solutions to our customers. The preliminary allocation of the fair value of the net assets acquired comprises customer lists ($26.2 million), trade name ($3.1 million), patent ($0.6 million), accounts receivable ($1.5 million), inventory ($3.8 million), other current assets ($0.2 million), and other assets ($0.4 million), net of current liabilities ($0.7 million) and other liabilities ($0.1 million). Customer lists and patent are being amortized over 15 years and 5 years, respectively, while the trade name and goodwill are not being amortized. During the three months ended December 31, 2025, the Company completed the evaluation of the facts and circumstances available as of November 4, 2024, to assign fair values to assets and liabilities acquired. Goodwill and all intangible assets are deductible and amortized over 15 years for income tax purposes. PF WaterWorks activity has been included in our Contractor Solutions segment since the acquisition date.
The disclosure of PF WaterWorks' post-acquisition revenue and net income is not practical due to integration activities since the acquisition date. No pro forma information has been provided due to immateriality.
3. CONSOLIDATION OF VARIABLE INTEREST ENTITY AND REDEEMABLE NONCONTROLLING INTEREST
Whitmore Joint Venture
On April 1, 2021, Whitmore Manufacturing, LLC (“Whitmore”), a wholly-owned subsidiary of CSW, completed the formation of the joint venture (the “Whitmore JV”) with Pennzoil-Quaker State Company dba SOPUS Products, a wholly-owned subsidiary of Shell Oil Company that comprises Shell’s U.S. lubricants business.
The Whitmore JV is deemed to be a VIE as the equity investors at risk, as a group, lack the characteristics of a controlling financial interest. The major factor that led to the conclusion that the Company is the primary beneficiary of this VIE is that Whitmore has the power to direct the most significant activities due to its ability to direct the manufacturing decisions of the Whitmore JV. Whitmore JV’s total net assets are presented below (in thousands):
| | | | | | | | | | | |
| December 31, 2025 | | March 31, 2025 |
| Cash | $ | 4,081 | | | $ | 9,591 | |
| Accounts receivable, net | 8,727 | | | 8,407 | |
| Inventories, net | 4,920 | | | 4,823 | |
| Prepaid expenses and other current assets | 241 | | | 254 | |
| Property, plant and equipment, net | 15,143 | | | 13,452 | |
| Intangible assets, net | 4,252 | | | 4,859 | |
| Other assets | 783 | | | 597 | |
| Total assets | $ | 38,147 | | | $ | 41,983 | |
| | | |
| Accounts payable | $ | 5,606 | | | $ | 7,755 | |
| Accrued and other current liabilities | 2,031 | | | 1,605 | |
| Other long-term liabilities | 807 | | | 414 | |
| Total liabilities | $ | 8,444 | | | $ | 9,774 | |
During the three and nine months ended December 31, 2025, the Whitmore JV generated net income of $0.7 million and $1.5 million, respectively.
The Whitmore JV’s LLC Agreement contains a put option that gives either member the right to sell its 50% equity interest in the Whitmore JV to the other member at a dollar amount equivalent to 90% of the initiating member's equity interest determined based on the fair market value of the Whitmore JV’s net assets. This put option can be exercised, at either member’s discretion, by providing written notice to the other member during the month of July 2024 and every two years thereafter. No put option was provided in July 2024. This redeemable noncontrolling interest is recorded at the higher of the redemption value or carrying value each reporting period. Changes in redeemable noncontrolling interest for the nine-month period ended December 31, 2025 were as follows (in thousands):
| | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Balance at beginning of the fiscal year | $ | 20,187 | | | $ | 19,355 | |
| | | |
| Net income attributable to redeemable noncontrolling interest | 738 | | | 839 | |
| | | |
| Distributions to redeemable noncontrolling interest shareholder | (2,000) | | | — | |
| | | |
| Ending balance | $ | 18,925 | | | $ | 20,194 | |
4. INVENTORIES
Inventories consist of the following (in thousands): | | | | | | | | | | | | | | |
| | December 31, 2025 | | March 31, 2025 |
| Raw materials and supplies | | $ | 101,170 | | | $ | 54,761 | |
| Work in process | | 5,140 | | | 5,969 | |
| Finished goods | | 221,969 | | | 144,897 | |
| Total inventories | | 328,279 | | | 205,627 | |
| Less: Obsolescence reserve | | (12,869) | | | (10,751) | |
| Inventories, net | | $ | 315,410 | | | $ | 194,876 | |
5. GOODWILL AND INTANGIBLE ASSETS
The changes in the carrying amount of goodwill as of December 31, 2025 and March 31, 2025 were as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Total |
| Balance at March 31, 2025 | | $ | 230,880 | | | $ | 9,437 | | | $ | 23,775 | | | $ | 264,092 | |
| ProAction Fluids acquisition | | — | | | 6,827 | | | — | | | 6,827 | |
| Hydrotex acquisition | | — | | | 2,820 | | | — | | | 2,820 | |
| MARS Parts acquisition | | 264,981 | | | — | | | — | | | 264,981 | |
| Aspen Manufacturing acquisition | | 100,244 | | | — | | | — | | | 100,244 | |
| PF WaterWorks acquisition | | 619 | | | — | | | — | | | 619 | |
| | | | | | | | |
| Currency translation | | (62) | | | 147 | | | 394 | | | 479 | |
| Balance at December 31, 2025 | | $ | 596,662 | | | $ | 19,231 | | | $ | 24,169 | | | $ | 640,062 | |
| | | | | | | | |
The following table provides information about our intangible assets (in thousands, except years):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | December 31, 2025 | | March 31, 2025 |
| Weighted Avg Life (Years) | | Gross Amount | | Accumulated Amortization | | Gross Amount | | Accumulated Amortization |
| Finite-lived intangible assets: | | | | | | | | | |
| Patents | 10 | | $ | 17,786 | | | $ | (11,032) | | | $ | 17,784 | | | $ | (10,189) | |
| Customer lists and amortized trademarks | 15 | | 926,323 | | | (158,494) | | | 402,765 | | | (127,551) | |
| Non-compete agreements | 6 | | 1,000 | | | (770) | | | 1,000 | | | (639) | |
| Other | 10 | | 6,276 | | | (3,455) | | | 6,277 | | | (3,141) | |
| | | $ | 951,385 | | | $ | (173,751) | | | $ | 427,826 | | | $ | (141,520) | |
| Trade names and trademarks not being amortized: | | | $ | 140,431 | | | $ | — | | | $ | 71,604 | | | $ | — | |
Amortization expenses for the three and nine months ended December 31, 2025 were $14.7 million and $32.7 million, respectively. Amortization expenses for the three and nine months ended December 31, 2024 were $6.4 million and $18.3 million, respectively. The following table shows the estimated future amortization for intangible assets, as of December 31, 2025, for the remainder of the current fiscal year and the next four fiscal years ending March 31 (in thousands):
| | | | | |
| 2026 | $ | 14,517 | |
| 2027 | 60,971 | |
| 2028 | 60,579 | |
| 2029 | 60,503 | |
| 2030 | 60,437 | |
| Thereafter | 520,627 | |
| Total | $ | 777,634 | |
6. SHARE-BASED COMPENSATION
Prior to September 17, 2024, we maintained the shareholder-approved 2015 Equity and Incentive Compensation Plan (the “2015 Plan”), which provided for the issuance of up to 1,230,000 shares of CSW common stock through the grant of stock options, stock appreciation rights, restricted shares, restricted stock units, performance shares, performance units or other share-based awards, to employees, officers and non-employee directors. On August 15, 2024, our shareholders approved the 2024 Equity and Incentive Compensation Plan (the “2024 Plan”) and on September 17, 2024, we registered the offering of shares under the 2024 Plan on a Registration Statement on Form S-8 (the “2024 Plan Registration”). Following the 2024 Plan Registration, no awards have been or will be granted under the 2015 Plan, and the 2015 Plan’s remaining share reserve for new
awards was cancelled. Any awards granted under the 2015 Plan prior to the 2024 Plan Registration remain outstanding and vest in accordance with their original terms and conditions.
The 2024 Plan provides for the issuance of up to 850,000 shares of CSW common stock (less any shares granted pursuant to awards under the 2015 Plan prior to the 2024 Plan Registration) through the grant of stock options, stock appreciation rights, restricted shares, restricted stock units, performance shares, performance units or other share-based awards, to employees, officers and non-employee directors. As of December 31, 2025, and due to awards granted under the 2015 Plan prior to the 2024 Plan Registration, as well as new grant activity under the 2024 Plan, 784,102 shares were reserved and available for issuance under the 2024 Plan.
We recorded share-based compensation expense as follows for the three and nine months ended December 31, 2025 and 2024 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended
December 31, | | Nine Months Ended
December 31, |
| | 2025 | | 2024 | | 2025 | | 2024 |
| Share-based compensation expense | | $ | 3,751 | | | $ | 3,345 | | | $ | 11,379 | | | $ | 10,237 | |
| Related income tax benefit (a) | | (938) | | | (836) | | | (2,845) | | | (2,559) | |
| Net share-based compensation expense | | $ | 2,813 | | | $ | 2,509 | | | $ | 8,534 | | | $ | 7,678 | |
(a) Income tax benefit is estimated using the statutory rate.
Restricted share activity was as follows:
| | | | | | | | | | | | | | |
| | Nine Months Ended December 31, 2025 |
| | Number of Shares | | Weighted Average Grant Date Fair Value |
| Outstanding at March 31, 2025: | | 194,149 | | | $ | 203.62 | |
| Granted (a) | | 64,929 | | | 317.83 | |
| Vested (a) | | (71,780) | | | 177.46 | |
| Canceled | | (3,396) | | | 253.80 | |
| Outstanding at December 31, 2025 | | 183,902 | | | $ | 235.72 | |
(a) Including incremental shares delivered to grant recipients as a result of performance-based awards vesting in excess of target (100%).
During the restriction period, the holders of restricted shares are entitled to vote and receive dividends. Unvested restricted shares outstanding as of December 31, 2025 and 2024 included 82,428 and 95,225 shares (at target), respectively, with performance-based vesting provisions, and a vesting range of 0%-200% based on pre-defined performance targets with market conditions. Performance-based awards accrue dividend equivalents, which are settled upon (and to the extent of) vesting of the underlying award and do not have the right to vote until vested. Performance-based awards are earned upon the achievement of objective performance targets and are payable in common shares. Compensation expense is calculated based on the fair market value as determined by a Monte Carlo simulation and is recognized over a 36-month cliff vesting period. We granted no awards with performance-based vesting provisions during the three months ended December 31, 2025 and 2024. We granted 16,982 and 18,962 awards with performance-based vesting provisions during the nine months ended December 31, 2025 and 2024, respectively, with a vesting range of 0%-200%.
At December 31, 2025, we had unrecognized compensation cost related to unvested restricted shares of $21.7 million, which will be amortized into net income over the remaining weighted average vesting period of approximately 2.1 years. The total fair value of restricted shares granted during the three months ended December 31, 2025 and 2024 was $6.0 million and $7.1 million, respectively. The total fair value of restricted shares granted during the nine months ended December 31, 2025 and 2024 was $14.3 million and $14.3 million, respectively. The total fair value of restricted shares vested during the three months ended December 31, 2025 and 2024 was $7.2 million and $11.8 million, respectively. The total fair value of restricted shares vested during the nine months ended December 31, 2025 and 2024 was $19.8 million and $22.1 million, respectively.
7. LONG-TERM DEBT
Long-term debt consists of the following (in thousands): | | | | | | | | | | | | | | |
| | December 31, 2025 | | March 31, 2025 |
Revolving Credit Facility, interest rate of 5.46% (a) and N/A (b) | | $ | 200,099 | | | $ | — | |
Senior Secured Term Loan A, interest rate of 5.32% (a) and N/A (b) | | 600,000 | | | — | |
| Total debt, gross | | 800,099 | | | — | |
| Less: Current portion | | (29,458) | | | — | |
| Less: Deferred TLA financing costs, net of amortization | | (2,343) | | | — | |
| Long-term debt, net | | $ | 768,298 | | | $ | — | |
(a) Represents the interest rate effective on December 31, 2025, including the impact from the interest rate swap discussed in Note 9.
(b) Interest rate effective on March 31, 2025 was not applicable due to there being no outstanding balance under the Revolving Credit Facility and the non-existence of the Senior Secured Term Loan A at that date.
Revolving Credit Facility
As discussed in Note 8 to our consolidated financial statements included in our Annual Report, prior to May 2025, we maintained a $500.0 million revolving credit facility that contained a $25.0 million sublimit for the issuance of letters of credit and a $10.0 million sublimit for swingline loans, with an additional $50 million accordion feature (the “Second Amendment”). The credit facility was scheduled to mature on May 18, 2026. Borrowings under the Second Amendment bore interest at either base rate plus between 0.25% to 1.5% or SOFR rate plus between 1.25% to 2.5%, based on the Company’s leverage ratio calculated on a quarterly basis. The base rate was described in the Second Amendment as the highest of (i) the Federal funds effective rate plus 0.50%, (ii) the prime rate quoted by The Wall Street Journal, and (iii) the one-month SOFR rate plus 1.00%. We paid a commitment fee between 0.15% to 0.4% based on the Company’s leverage ratio for the unutilized portion of this facility. Interest and commitment fees were payable at least quarterly and the outstanding principal balance was due at the maturity date. The Second Amendment was secured by a first priority lien on all tangible and intangible assets and stock issued by the Company and its domestic subsidiaries, subject to specified exceptions, and 65% of the voting equity interests in its first-tier foreign subsidiaries.
On May 2, 2025, we entered into a Third Amended and Restated Credit Agreement (the “Third Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”) and collateral agent, and the lenders, issuing banks and swingline lender party thereto. The Third Credit Agreement provides for a $700.0 million revolving credit facility that contains a $30.0 million sublimit for the issuance of letters of credit, a $15.0 million sublimit for swingline loans and an additional accordion feature of $250 million. The Third Credit Agreement was scheduled to mature on May 2, 2030. The Company incurred a total of $2.8 million in financing fees, including underwriting fees, which will be amortized over the life of the Third Credit Agreement. The deferred financing fees are recorded in our consolidated balance sheets in other assets. Borrowings under the Third Credit Agreement bear interest at either base rate plus between 0.25% to 1.5% or the adjusted term SOFR rate plus between 1.25% to 2.5%, based on the Company’s leverage ratio calculated on a quarterly basis. The base rate is described in the Third Credit Agreement as the highest of (i) the Federal Reserve Bank of New York effective rate plus 0.50%, (ii) the prime rate quoted by The Wall Street Journal, and (iii) the one-month adjusted term SOFR rate plus 1.00%. We pay a commitment fee between 0.15% to 0.4% based on the Company's leverage ratio for the unutilized portion of this facility. Interest and commitment fees are payable monthly and quarterly, respectively, and the outstanding principal balance is due at the maturity date. The Third Credit Agreement is secured by a first priority lien on substantially all tangible and intangible assets and stock issued by the Company and its material domestic subsidiaries, subject to specified exceptions, and 65% of the voting equity interests in its first-tier foreign subsidiaries.
On November 4, 2025, we entered into a Fourth Amended and Restated Credit agreement (the "Fourth Credit Agreement") with JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”) and collateral agent, and the lenders, issuing banks and swingline lender party thereto. The Fourth Credit Agreement, among other things, provides for: (i) the continuation of the existing revolving credit facility in the aggregate principal committed amount of up to $700.0 million (the “RCF”); (ii) the extension of the maturity date of the RCF until November 4, 2030; and (iii) the establishment of a new senior secured term loan “A” credit facility (the “TLA”) in an aggregate principal amount of up to $600.0 million, and having a maturity date of November 4, 2030.
During the nine months ended December 31, 2025, we borrowed $435.5 million and repaid $235.4 million under the Revolving Credit Facility. As of December 31, 2025 and March 31, 2025, we had $200.1 million and $0.0 million, respectively, in our outstanding balance, which resulted in borrowing capacity under the Revolving Credit Facility of $498.6
million and $498.7 million, respectively, net of credit utilization. The financial covenants contained in the Third Credit Agreement require the maintenance of a maximum leverage ratio of 3.50 to 1.00, subject to a temporary increase to 4.00 to 1.00 for 18 months following the consummation of permitted acquisitions with consideration in excess of certain threshold amounts set forth in the Third Credit Agreement. The Third Credit Agreement also requires the maintenance of a minimum interest coverage ratio of 3.00 to 1.00, the calculations and terms of which are defined in the Third Credit Agreement. Covenant compliance is tested quarterly, and we were in compliance with all covenants as of December 31, 2025.
Senior Secured Term Loan A
On November 4, 2025, we entered into a Fourth Credit Agreement, as aforementioned, which provided the establishment of the TLA to finance a portion of the purchase price of the MARS Parts acquisition (including payment of related fees, premiums, expenses and other transaction costs) as discussed in Note 2. The Company incurred a total of $2.4 million in financing fees, including underwriting fees, which will be amortized over the life of the Fourth Credit Agreement. The deferred financing fees are recorded in our consolidated balance sheets in long-term debt and the current portion of long-term debt. The TLA amortizes in equal quarterly installments of 1.25% of the initial aggregate principal amount of the TLA, with the total outstanding balance due in full on maturity of November 4, 2030. Borrowings under the TLA bear interest at either base rate plus between 0.25% to 1.5% or the adjusted term SOFR rate plus between 1.25% to 2.5%, based on the Company’s leverage ratio calculated on a quarterly basis. We pay a commitment fee between 0.15% to 0.4% based on the Company's leverage ratio for the unutilized portion of this term loan. Interest and commitment fees are payable monthly and quarterly, respectively. As of December 31, 2025 and March 31, 2025, we had $600.0 million and $0.0 million, respectively, in principal amount outstanding.
Interest payments on the first $300.0 million borrowing under the TLA are hedged under an interest rate swap agreement as described in Note 9.
Future Minimum Debt Payments
Future minimum debt payments are as follows for the years ending March 31 (in thousands):
| | | | | |
| 2026 | $ | 7,500 | |
| 2027 | 30,000 | |
| 2028 | 30,000 | |
| 2029 | 30,000 | |
| 2030 | 30,000 | |
| November 2030 | 672,599 | |
| Total | $ | 800,099 | |
8. LEASES
We have operating leases for manufacturing facilities, offices, warehouses, vehicles and certain equipment. Our leases have remaining lease terms of 1 year to 22 years, some of which include escalation clauses and/or options to extend or terminate the leases. We have immaterial financing lease arrangements.
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | Nine Months Ended December 31, |
| (in thousands) | | 2025 | | 2024 | | 2025 | | 2024 |
| Components of Operating Lease Expense | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Operating lease expense (a) | | $ | 4,497 | | | $ | 3,258 | | | $ | 12,447 | | | $ | 9,605 | |
| Short-term lease expense | | 95 | | | 245 | | | 383 | | | 695 | |
| Total operating lease expense | | $ | 4,592 | | | $ | 3,503 | | | $ | 12,830 | | | $ | 10,300 | |
| (a) Included in cost of revenues and selling, general and administrative expenses | | | | |
| | | | | | | | | | | | | | |
| (in thousands) | | December 31, 2025 | | March 31, 2025 |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| Operating Lease Assets and Liabilities | | | | |
| Right-of-use assets, net (b) | | $ | 71,488 | | | $ | 62,061 | |
| | | | |
| Short-term lease liabilities (c) | | $ | 13,728 | | | $ | 11,244 | |
| Long-term lease liabilities (c) | | 64,935 | | | 58,120 | |
| Total operating lease liabilities | | $ | 78,663 | | | $ | 69,364 | |
| (b) Included in other assets | | | | |
| (c) Included in accrued and other current liabilities and other long-term liabilities | | |
| | | | | | | | | | | | | | |
| | Nine Months Ended December 31, |
| (in thousands) | | 2025 | | 2024 |
| Supplemental Cash Flow | | | | |
| Cash paid for amounts included in the measurement of operating lease liabilities (d) | | $ | 12,470 | | | $ | 9,486 | |
| Right-of-use assets obtained in exchange for new operating lease liabilities | | 1,714 | | | 26,973 | |
| (d) Included in our Consolidated Statements of Cash Flows under operating activities in net income and accounts payable and other current liabilities |
| | | | |
| Other Information for Operating Leases | | | | |
| Weighted average remaining lease term (in years) | | 6.50 | | 7.25 |
| Weighted average discount rate | | 5.7 | % | | 5.2 | % |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | | | | |
| Maturities of operating lease liabilities were as follows (in thousands): | | | |
| Year Ending March 31, 2026 (excluding the nine months ended December 31, 2025) | $ | 4,638 | | | |
| 2027 | 17,248 | | | |
| 2028 | 15,780 | | | |
| 2029 | 14,257 | | | |
| 2030 | 11,942 | | | |
| Thereafter | 31,596 | | | |
| Total lease liabilities | 95,461 | | | |
| Less: Imputed interest | (16,798) | | | |
| Present value of lease liabilities | $ | 78,663 | | | |
9. DERIVATIVE INSTRUMENTS AND HEDGE ACCOUNTING
From time to time, we enter into interest rate swap agreements to hedge exposure to floating interest rates on certain portions of our debt.
On February 2, 2023, we entered into an interest rate swap to hedge our exposure to variability in cash flows from interest payments on the first $100.0 million of borrowings under our Revolving Credit Facility. This interest rate swap fixed the one-month SOFR rate at 3.85% for the first $100.0 million borrowing under our Revolving Credit Facility and was scheduled to expire on May 18, 2026. In September 2024, upon the payoff of the outstanding Revolving Credit Facility balance, we terminated the interest rate swap and incurred a cash payment of $0.4 million, which was reported in our Consolidated Statements of Income in interest expense, net.
On November 4, 2025, we entered into an interest rate swap to hedge our exposure to variability in cash flows from interest payments on the first $300.0 million of borrowings under the TLA, as discussed in Note 7. The interest rate swap fixed the one-month SOFR rate at 3.42% for the first $300.0 million borrowing under our TLA and is scheduled to expire on October 31, 2028. As of December 31, 2025 and 2024, we had $300.0 million and no notional amount, respectively, outstanding designated as an interest rate swap with third parties. At December 31, 2025, the maximum remaining length of the interest rate swap contract was approximately 2.8 years. The fair value of the interest rate swap designated as a hedging instrument is summarized below (in thousands):
| | | | | | | | | | | | | | |
| | December 31, 2025 | | March 31, 2025 |
| | | | |
| | | | |
| Current derivative liabilities | | $ | 33 | | | $ | — | |
| Non-current derivative liabilities | | 890 | | | — | |
The impact of changes in fair value of the interest rate swap is included in Note 15.
Current and non-current derivative assets are reported in our consolidated balance sheets in prepaid expenses and other current assets and other assets, respectively. Current and non-current derivative liabilities are reported in our consolidated balance sheets in accrued and other current liabilities and other long-term liabilities, respectively.
10. EARNINGS PER SHARE
The following table sets forth the reconciliation of the numerator and the denominator of basic and diluted earnings per share for the three and nine months ended December 31, 2025 and 2024 (amounts in thousands, except per share data):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended
December 31, | | Nine Months Ended
December 31, |
| | 2025 | | 2024 | | 2025 | | 2024 |
| Net income | | $ | 10,597 | | | $ | 26,958 | | | $ | 92,581 | | | $ | 102,429 | |
| Less: Net income attributable to redeemable noncontrolling interest | | (336) | | | (10) | | | (738) | | | (839) | |
| Net income attributable to CSW | | $ | 10,261 | | | $ | 26,948 | | | $ | 91,843 | | | $ | 101,590 | |
| | | | | | | | |
| Weighted average shares: | | | | | | | | |
| Common stock | | 16,500 | | | 16,705 | | | 16,640 | | | 15,969 | |
| Participating securities | | 80 | | | 87 | | | 84 | | | 97 | |
| Denominator for basic earnings per common share | | 16,580 | | | 16,792 | | | 16,724 | | | 16,066 | |
| Potentially dilutive securities | | 61 | | | 80 | | | 57 | | | 70 | |
| Denominator for diluted earnings per common share | | 16,641 | | | 16,872 | | | 16,781 | | | 16,136 | |
| | | | | | | | |
| Net income per share attributable to CSW: | | | | | | | | |
| Basic | | $ | 0.62 | | | $ | 1.60 | | | $ | 5.49 | | | $ | 6.32 | |
| Diluted | | $ | 0.62 | | | $ | 1.60 | | | $ | 5.47 | | | $ | 6.30 | |
11. SHAREHOLDERS' EQUITY
Common Stock
| | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Common Stock | | Treasury Stock | | Common Stock | | Treasury Stock |
| Balance at beginning of the fiscal year | 17,809,590 | | | 1,026,941 | | | 16,465,776 | | | 952,394 | |
| Vesting of performance shares and restricted stock units | 40,853 | | | 21,826 | | | 39,928 | | | 14,381 | |
| Reissuance of treasury shares | — | | | (15,539) | | | — | | | (17,186) | |
| Restricted stock awards activities | 24,564 | | | — | | | 19,967 | | | 10,639 | |
| Share repurchases | — | | | 371,549 | | | — | | | 44,858 | |
| Equity issuance | — | | | — | | | 1,265,000 | | | — | |
| Ending balance | 17,875,007 | | | 1,404,777 | | | 17,790,671 | | | 1,005,086 | |
Equity Offering
In September 2024, the Company completed a follow-on equity offering ("Equity Offering"), pursuant to which we issued and sold a total of 1,265,000 shares of our common stock to the public, including shares issued pursuant to the underwriters' full exercise of their over-allotment option, at an offering price of $285 per share. We received proceeds of $347.4 million, net of underwriting fees and discounts and expenses incurred directly related to the Equity Offering. We used a portion of the proceeds to pay off the outstanding balance of our Revolving Credit Facility at the time of the Equity Offering, and used the remainder of the proceeds for general corporate purposes, including the acquisitions of PF WaterWorks and Aspen Manufacturing, as discussed in Note 2.
Share Repurchase Program
On December 16, 2022, we announced that our Board of Directors authorized a program to repurchase up to $100.0 million of our common stock over a two-year period. On November 18, 2024, we announced that our Board of Directors authorized a
new $200.0 million share repurchase program, which replaced the previously announced $100.0 million program. On December 15, 2025, we announced an expansion of our current share repurchase program authorization from $200.0 million to $250.0 million. Under the current repurchase program, shares may be repurchased from time to time in the open market or in privately negotiated transactions. Repurchases will be made at our discretion, based on ongoing assessments of the capital needs of the business, the market price of our common stock and general market conditions. Our Board of Directors has established an expiration date of December 31, 2026, for completion of the current repurchase program; however, such program may be limited or terminated at any time at our discretion without notice.
Under the current $250.0 million repurchase program, a total of 283,099 and 371,549 shares were repurchased during the three and nine months ended December 31, 2025 for $69.6 million and $92.6 million, respectively. Under the current $250.0 million repurchase program, 5,705 shares were repurchased during the three months ended December 31, 2024 for $2.2 million. Under the prior $100.0 million repurchase program, 6,703 and 39,153 shares were repurchased during the three and nine months ended December 31, 2024 for $2.6 million and $11.5 million, respectively.
In connection with the vesting of share awards, 6,860 and 21,826 shares for $1.7 million and $6.2 million, respectively, were tendered by employees to satisfy minimum tax withholding requirements during the three and nine months ended December 31, 2025, respectively. 10,737 and 25,050 shares for $3.9 million and $7.2 million, respectively, were tendered by employees to satisfy minimum tax withholding requirements during the three and nine months ended December 31, 2024, respectively
Dividends
On April 14, 2024, we announced a quarterly dividend increase to a rate of $0.21 per share, which was subsequently increased to a rate of $0.24 per share on October 11, 2024. On April 15, 2025, we announced another quarterly dividend increase to a rate of $0.27 per share. Total dividends of $4.5 million and $4.0 million were paid during the three months ended December 31, 2025 and 2024, respectively. Total dividends of $13.6 million and $10.6 million were paid during the nine months ended December 31, 2025 and 2024, respectively.
On January 16, 2026, we announced a quarterly dividend of $0.27 per share payable on February 13, 2026 to shareholders of record as of January 30, 2026. Any future dividends at the existing $0.27 per share quarterly rate or otherwise will be reviewed individually and declared by our Board of Directors in its discretion.
12. FAIR VALUE MEASUREMENTS
The carrying amounts of cash, accounts receivable, net and accounts payable approximate their fair values at December 31, 2025 and March 31, 2025 due to their short-term nature. Cash equivalents generally consist of money market funds invested with a reputable and highly diversified global bank in instruments issued or guaranteed by the U.S. Treasury. The fair value of these cash equivalents is based on quoted market price, which is a Level I input. The carrying value of our debt (discussed in Note 7) approximates fair value as it bears interest at variable rates. The fair value of the interest rate swap contract (as discussed in Note 9) is determined using Level II inputs.
The long-term investments with no readily determinable fair value are measured using the alternative for fair value and the investment's carrying value is reported at cost, adjusted for impairments or any observable price changes in ordinary transactions with identical or similar investments. As of December 31, 2025 and March 31, 2025, the long-term investments reported in the balance sheets were $2.5 million and $2.5 million, respectively.
The redeemable noncontrolling interest is recorded at the higher of the redemption value or carrying value each reporting period. The redemption value of the redeemable noncontrolling interest is estimated using a discounted cash flow analysis, which requires management judgment with respect to future revenue, operating margins, growth rates and discount rates and is classified as Level III under the fair value hierarchy. The redemption value of the redeemable noncontrolling interest is discussed in Note 3.
The fair value of the contingent consideration liability related to acquisitions is determined using either a scenario-based analysis on forecasted future results or an option pricing model simulation that determines an average projected payment value across numerous iterations. The contingent consideration liability is recorded at fair value on the acquisition date and is remeasured quarterly based on the then assessed fair value. The increases or decreases in the fair value of the contingent consideration can result from changes in future operations, forecasted revenue and assumed discount rates. The fair value
measurement is based on significant inputs that are not observable in the market and is classified as Level III under the fair value hierarchy. As of December 31, 2025 and March 31, 2025, the contingent consideration liabilities, reported in our consolidated balance sheets in accrued and other current liabilities and other long-term liabilities, were $33.1 million and $24.4 million, respectively.
The following table presents the fair values of the Company's assets and liabilities measured on a recurring basis:
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | December 31, 2025 | | March 31, 2025 |
| (in thousands) | | Carrying Value | | Fair Value | | Carrying Value | | Fair Value |
| Significant Other Observable Inputs (Level II) |
| Interest rate swap | | $ | 923 | | | $ | 923 | | | $ | — | | | $ | — | |
| | | | | | | | |
| Unobservable Inputs (Level III) |
| Acquisition-related contingent consideration liabilities | | 33,135 | | | 33,135 | | | 24,385 | | | 24,385 | |
The following table presents the changes in the estimated fair values of the Company's contingent consideration liabilities measured using significant unobservable inputs (Level 3):
| | | | | | | | | | | | | | |
| (in thousands) | | December 31, 2025 | | March 31, 2025 |
| Balance at beginning of the fiscal year: | | $ | 24,385 | | | $ | 7,445 | |
| Cash payments | | (4,650) | | | (160) | |
| Change in fair value of contingent consideration liabilities | | — | | | 2,100 | |
| Additions | | 13,400 | | | 15,000 | |
| Ending balance | | $ | 33,135 | | | $ | 24,385 | |
13. CONTINGENCIES
From time to time, we are involved in various claims and legal actions that arise in the ordinary course of business. There are no matters pending, whether individually or in the aggregate, that we currently believe have a reasonable possibility of having a material impact to our business, consolidated financial position, results of operations or cash flows.
As of December 31, 2025, we were contingently liable in connection with a $1.3 million surety bond associated with our performance under an agreement with a logistics service provider. The letter of credit collateralizing this bond was issued under our Revolving Credit Facility and reduces the available borrowing capacity. We have not recorded any liability for this contingency, as we believe the likelihood of having to perform under the letter of credit is remote.
14. INCOME TAXES
For the three months ended December 31, 2025, we earned $7.9 million from operations before taxes and recognized net income tax benefits of $2.7 million, resulting in an effective tax rate of (34.2)%. For the nine months ended December 31, 2025, we earned $117.7 million from operations before taxes and provided for income taxes of $25.2 million, resulting in an effective tax rate of 21.4%. The provision for income taxes differed from the statutory rate for the three and nine months ended December 31, 2025 primarily due to state income tax (net of federal benefit), executive compensation limitations, provision for global intangible low-taxed income ("GILTI"), and non-deductible transaction costs; offset by release of uncertain tax position ("UTP") due to lapse of statute, excess tax deductions related to equity compensation, and foreign tax credits.
In connection with the T.A. Industries, Inc. (“TRUaire”) acquisition that closed in December 2020, the Company recognized a UTP of $17.3 million related to pre-acquisition tax periods. In addition, in accordance with the tax indemnification provided by the seller to the Company for up to $12.5 million related to UTPs taken in pre-acquisition years, we recognized a tax indemnification asset of $12.5 million, $5 million of which was released in the three months ended March 31, 2021. During the three months ended December 31, 2023, the remaining $7.5 million tax indemnification asset expired and was recognized as non-cash other expense on the statement of income, which is not deductible for income tax purposes. During the three months ended December 31, 2025 and 2024, $5.0 million and $2.7 million of the UTP accrual (including penalties and
interests accrued post-acquisition), respectively, were released due to the expiration of the tax statutes and were recorded as income tax benefits. As of December 31, 2025, the UTP accrual related to TRUaire's pre-acquisition tax periods was $8.5 million, including penalties and interests accrued post-acquisition, and is expected to be released in the future as the statutes on the open tax years expire.
In connection with the Falcon Stainless, Inc. (“Falcon”) acquisition that closed in October 2022, the Company recognized a UTP of $3.0 million related to pre-acquisition tax periods. In addition, in accordance with the tax indemnification provided by the seller to the Company for up to $4.5 million related to UTPs taken in pre-acquisition years, we recognized an initial tax indemnification asset of $3.0 million, which will either be settled or expire upon the closure of the tax statutes for the pre-acquisition periods. During the three months ended December 31, 2025, 2024 and 2023, as a result of the statute expiration, $1.4 million, $0.9 million and $1.0 million UTP, respectively, were released and the corresponding $1.4 million, $0.9 million and $1.0 million tax indemnification assets expired concurrently and were recognized as non-cash other expense on the statement of income, which is not deductible for income tax purposes. As of December 31, 2025, the UTP reserves, including penalties and interests accrued post-acquisition, and offsetting indemnification asset related to Falcon's pre-acquisition period were $0.5 million. The Falcon UTP reserves and offsetting indemnification asset will either be settled or expire upon the closure of the tax statutes for the pre-acquisition period.
For the three months ended December 31, 2024, we earned $31.3 million from operations before taxes and provided for income taxes of $4.3 million, resulting in an effective tax rate of 13.8%. For the nine months ended December 31, 2024, we earned $133.6 million from operations before taxes and provided for income taxes of $31.2 million, resulting in an effective tax rate of 23.3%. The provision for income taxes differed from the statutory rate for the three and nine months ended December 31, 2024 primarily due to state income tax (net of federal benefit), executive compensation limitations, and provision for GILTI; offset by release of UTPs due to lapse of statute, excess tax deductions related to equity compensation, foreign currency rate impact on the cumulative unrepatriated foreign earnings, foreign tax credits and foreign-derived intangible income (“FDII”).
The Company expects $6.4 million of reserves for UTPs to either be settled or expire within the next 12 months as the statutes of limitations expire.
We are under examination by the state of Michigan for the fiscal years ended March 31, 2021 through 2024. We have not been notified of any material adjustments.
The Organization for Economic Cooperation and Development introduced a framework under pillar two ("Pillar Two"), which includes a global minimum tax rate of 15% applied on a county-by-country basis for companies with global revenues and profits above certain thresholds. Certain jurisdictions in which we do business have enacted laws implementing Pillar Two. We are monitoring these developments and do not believe these rules will have a material impact on our financial condition and/or consolidated results.
On July 4, 2025, the "One Big Beautiful Bill Act" (the "Act") was enacted into law. The Act includes changes to the U.S. tax laws that are applicable to the Company, including the reinstatement of 100% bonus depreciation and 100% expensing of research and development costs, a change in the calculation of deductible interest expense, and changes to the U.S. tax treatment of GILTI and FDII. We evaluated the Act, including estimating the impact of certain provisions of the Act that may impact the estimated annual effective tax rate for the current year, and estimated it to have an immaterial impact on our income tax expenses. We expect the Act will change the timing of our cash tax payments in the current fiscal year and future periods. We will continue to evaluate the impact of the Act as additional guidance becomes available.
15. OTHER COMPREHENSIVE INCOME (LOSS)
The following table provides an analysis of the changes in accumulated other comprehensive income (loss) (in thousands):
| | | | | | | | | | | | | | |
| | Three Months Ended
December 31, |
| | 2025 | | 2024 |
| Currency translation adjustments: | | | | |
| Balance at beginning of period | | $ | (11,892) | | | $ | (8,956) | |
| Adjustments for foreign currency translation | | 481 | | | (3,674) | |
| Balance at end of period | | $ | (11,411) | | | $ | (12,630) | |
| | | | |
| Interest rate swaps: | | | | |
| Balance at beginning of period | | $ | — | | | $ | — | |
Unrealized losses, net of taxes of $141 and $0, respectively (a) | | (529) | | | — | |
Reclassification of losses included in interest expense, net, net of taxes of $53 and $0, respectively | | (201) | | | — | |
| | | | |
| Other comprehensive income | | (730) | | | — | |
| Balance at end of period | | $ | (730) | | | $ | — | |
| | | | |
| Defined benefit plans: | | | | |
| Balance at beginning of period | | $ | (103) | | | $ | (99) | |
Amortization of net gains, net of taxes of $0 and $0, respectively (b) | | 1 | | | — | |
| | | | |
| | | | |
| Balance at end of period | | $ | (102) | | | $ | (99) | |
| | | | | | | | | | | | | | |
| | Nine Months Ended December 31, |
| | 2025 | | 2024 |
| Currency translation adjustments: | | | | |
| Balance at beginning of period | | $ | (12,020) | | | $ | (10,137) | |
| Adjustments for foreign currency translation | | 609 | | | (2,493) | |
| Balance at end of period | | $ | (11,411) | | | $ | (12,630) | |
| | | | |
| Interest rate swaps: | | | | |
| Balance at beginning of period | | $ | — | | | $ | 1,111 | |
Unrealized losses, net of taxes of $141 and $153, respectively (a) | | (529) | | | (577) | |
Reclassification of losses included in interest expense, net, net of taxes of $53 and $142, respectively | | (201) | | | (534) | |
| Other comprehensive income (loss) | | (730) | | | (1,111) | |
| Balance at end of period | | $ | (730) | | | $ | — | |
| | | | |
| Defined benefit plans: | | | | |
| Balance at beginning of period | | $ | (107) | | | $ | (100) | |
Amortization of net losses, net of taxes of $(1) and $0, respectively (b) | | 5 | | | 1 | |
| | | | |
| | | | |
| Balance at end of period | | $ | (102) | | | $ | (99) | |
(a) Unrealized gain (loss) is reclassified to earnings as underlying cash interest settlements are made or received. We expect to recognize a loss of less than $0.1 million, net of deferred taxes, over the next twelve months related to the designated cash flow hedge based on its fair value at December 31, 2025.
(b) Amortization of actuarial gains (losses) out of accumulated comprehensive loss are included in the computation of net periodic pension expense.
16. REVENUE RECOGNITION
Refer to Note 19 to our consolidated financial statements included in our Annual Report for a description of our disaggregation of revenues. Disaggregation of revenues reconciled to our reportable segments is as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, 2025 | | Nine Months Ended December 31, 2025 |
| | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Total | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Total |
| Build-to-order | | $ | — | | | $ | — | | | $ | 25,346 | | | $ | 25,346 | | | $ | — | | | $ | — | | | $ | 81,860 | | | $ | 81,860 | |
| Book-and-ship | | 166,294 | | | 38,247 | | | 3,105 | | | 207,646 | | | 567,546 | | | 113,786 | | | 10,397 | | | 691,729 | |
| Net revenues | | $ | 166,294 | | | $ | 38,247 | | | $ | 28,451 | | | $ | 232,992 | | | $ | 567,546 | | | $ | 113,786 | | | $ | 92,257 | | | $ | 773,589 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, 2024 | | Nine Months Ended December 31, 2024 |
| | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Total | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Total |
| Build-to-order | | $ | — | | | $ | — | | | $ | 25,422 | | | $ | 25,422 | | | $ | — | | | $ | — | | | $ | 81,255 | | | $ | 81,255 | |
| Book-and-ship | | 130,292 | | | 34,537 | | | 3,398 | | | 168,227 | | | 445,594 | | | 109,771 | | | 11,132 | | | 566,497 | |
| Net revenues | | $ | 130,292 | | | $ | 34,537 | | | $ | 28,820 | | | $ | 193,649 | | | $ | 445,594 | | | $ | 109,771 | | | $ | 92,387 | | | $ | 647,752 | |
As of December 31, 2025 and March 31, 2025, accounts receivable, net balances were $144.5 million and $155.7 million, respectively. As of December 31, 2024 and March 31, 2024, accounts receivable, net balances were $114.8 million and $142.7 million, respectively. The following table summarizes the activity in the allowance for credit losses (in thousands):
| | | | | | | | | | | | | | |
| | December 31, 2025 | | December 31, 2024 |
| Balance at beginning of the fiscal year: | | $ | 1,137 | | | $ | 908 | |
| Reserve | | 336 | | | 946 | |
| Write offs, net of recoveries | | (277) | | | (559) | |
| Ending balance | | $ | 1,196 | | | $ | 1,295 | |
Contract Balances
We receive payment from customers based on a contractual billing schedule and specific performance requirements as established in our contracts. We record billings as accounts receivable when an unconditional right to consideration exists. Contract liability represents our contractual billings in advance of revenue recognized for a contract and is included in accrued and other current liabilities in our consolidated balance sheets were as follows (in thousands):
| | | | | | | | | | | | | | |
| | December 31, 2025 | | December 31, 2024 |
| Balance at beginning of the fiscal year: | | $ | 932 | | | $ | 548 | |
| Revenue recognized during the period | | (723) | | | (411) | |
| New contracts and revenue added to existing contracts during the period | | 1,139 | | | 588 | |
| Ending balance | | $ | 1,348 | | | $ | 725 | |
17. SEGMENTS
As discussed in Note 20 to our consolidated financial statements in our Annual Report, we conduct our operations through three reportable segments:
•Contractor Solutions
•Specialized Reliability Solutions
•Engineered Building Solutions
The Eliminations and Other segment information below is included to reconcile segment data to the consolidated financial statements and includes general expenses that are applicable to the consolidated group and are, therefore, not allocated to the other reportable segments. All expenses reported within the Eliminations and Other segment are not included in our chief operating decision maker's ("CODM") evaluation of the operating performance of the other reportable segments.
The following is a summary of the financial information of our reporting segments reconciled to the amounts reported in the consolidated financial statements (in thousands).
Three Months Ended December 31, 2025: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (in thousands) | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Subtotal - Reportable Segments | | Eliminations and Other | | Total |
| Revenues, net to external customers | | $ | 166,293 | | | $ | 38,247 | | | $ | 28,452 | | | $ | 232,992 | | | $ | — | | | $ | 232,992 | |
| Intersegment revenue | | 1,706 | | | 36 | | | — | | | 1,742 | | | (1,742) | | | — | |
| Cost of revenues | | 99,750 | | | 24,621 | | | 17,920 | | | 142,291 | | | (1,742) | | | 140,549 | |
| Selling, general, and administrative expenses | | 51,459 | | | 9,144 | | | 7,170 | | | 67,773 | | | 7,332 | | | 75,105 | |
| Operating income | | 16,790 | | | 4,518 | | | 3,362 | | | 24,670 | | | (7,332) | | | 17,338 | |
| Depreciation & amortization | | 17,167 | | | 1,416 | | | 483 | | | 19,066 | | | (9) | | | 19,057 | |
| Capital expenditures | | 3,666 | | | 2,332 | | | 148 | | | 6,146 | | | — | | | 6,146 | |
Three Months Ended December 31, 2024: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (in thousands) | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Subtotal - Reportable Segments | | Eliminations and Other | | Total |
| Revenues, net to external customers | | $ | 130,292 | | | $ | 34,536 | | | $ | 28,821 | | | $ | 193,649 | | | $ | — | | | $ | 193,649 | |
| Intersegment revenue | | 1,859 | | | 30 | | | — | | | 1,889 | | | (1,889) | | | — | |
| Cost of revenues | | 75,442 | | | 22,047 | | | 17,943 | | | 115,432 | | | (1,889) | | | 113,543 | |
| Selling, general, and administrative expenses | | 29,953 | | | 7,281 | | | 7,233 | | | 44,467 | | | 6,044 | | | 50,511 | |
| Operating income | | 26,756 | | | 5,238 | | | 3,645 | | | 35,639 | | | (6,044) | | | 29,595 | |
| Depreciation & amortization | | 9,179 | | | 1,366 | | | 420 | | | 10,965 | | | 48 | | | 11,013 | |
| Capital expenditures | | 2,623 | | | 277 | | | 241 | | | 3,141 | | | 7 | | | 3,148 | |
Nine Months Ended December 31, 2025
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (in thousands) | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Subtotal - Reportable Segments | | Eliminations and Other | | Total |
| Revenues, net to external customers | | $ | 567,546 | | | $ | 113,787 | | | $ | 92,256 | | | $ | 773,589 | | | $ | — | | | $ | 773,589 | |
| Intersegment revenue | | 5,661 | | | 109 | | | 5 | | | 5,775 | | | (5,775) | | | — | |
| Cost of revenues | | 320,639 | | | 74,088 | | | 57,567 | | | 452,294 | | | (5,775) | | | 446,519 | |
| Selling, general, and administrative expenses | | 129,645 | | | 24,955 | | | 22,502 | | | 177,102 | | | 20,974 | | | 198,076 | |
| Operating income | | 122,923 | | | 14,853 | | | 12,192 | | | 149,968 | | | (20,974) | | | 128,994 | |
| Depreciation & amortization | | 41,262 | | | 4,100 | | | 1,339 | | | 46,701 | | | 86 | | | 46,787 | |
| Capital expenditures | | 8,142 | | | 3,463 | | | 525 | | | 12,130 | | | — | | | 12,130 | |
Nine Months Ended December 31, 2024
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (in thousands) | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Subtotal - Reportable Segments | | Eliminations and Other | | Total |
| Revenues, net to external customers | | $ | 445,594 | | | $ | 109,772 | | | $ | 92,386 | | | $ | 647,752 | | | $ | — | | | $ | 647,752 | |
| Intersegment revenue | | 5,809 | | | 121 | | | — | | | 5,930 | | | (5,930) | | | — | |
| Cost of revenues | | 239,244 | | | 68,111 | | | 54,899 | | | 362,254 | | | (5,930) | | | 356,324 | |
| Selling, general, and administrative expenses | | 89,265 | | | 23,574 | | | 22,036 | | | 134,875 | | | 20,349 | | | 155,224 | |
| Operating income | | 122,894 | | | 18,208 | | | 15,451 | | | 156,553 | | | (20,349) | | | 136,204 | |
| Depreciation & amortization | | 25,164 | | | 4,198 | | | 1,399 | | | 30,761 | | | 135 | | | 30,896 | |
| Capital expenditures | | 9,269 | | | 1,438 | | | 922 | | | 11,629 | | | 106 | | | 11,735 | |
TOTAL ASSETS
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (in thousands) | | Contractor Solutions | | Specialized Reliability Solutions | | Engineered Building Solutions | | Subtotal - Reportable Segments | | Eliminations and Other | | Total |
| December 31, 2025 | | $ | 2,005,562 | | | $ | 171,743 | | | $ | 82,283 | | | $ | 2,259,588 | | | $ | 25,944 | | | $ | 2,285,532 | |
| March 31, 2025 | | 941,087 | | | 145,663 | | | 81,347 | | | 1,168,097 | | | 210,968 | | | 1,379,065 | |