BRUNSWICK CORP

Previous wording

On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") were not authorized by the statute. The Company was previously subject to such tariffs under IEEPA. Because the process, timing, and amount of any IEEPA tariff recovery are uncertain, we have not recorded any benefit from a potential refund at this time.

Current wording

On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") were not authorized by the statute. The Company was previously subject to such tariffs under IEEPA. During the three months ended July 4, 2026, the Company submitted claims within the Consolidated Administration and Processing of Entries ("CAPE") system for processing tariff refunds and were subsequently accepted during the quarter totaling $34.3 million. These accepted claims for the recovery of IEEPA tariffs were deemed probable under the loss recovery model as of July 4, 2026. The Company recognized a reduction in Cost of sales of $30.4 million within the Condensed Consolidated Statements of Comprehensive Income. Additionally, $3.9 million of that tariff receivable is a reduction to inventory for certain tariff costs that were still capitalized within inventory. As of July 4, 2026, the total $30.9 million outstanding IEEPA tariff receivables are reflected within Prepaid expenses and other on the Condensed Consolidated Balance Sheets. Although the Company has assessed the recovery of these previously paid IEEPA tariffs is probable based on currently available information, the timing of cash receipts remains dependent upon the processing of refund claims by the CBP and U.S. Department of Treasury.

Previous wording

Net sales increased 12.8% during the first quarter of 2026 compared with the first quarter of 2025. This increase reflected improved wholesale and retail trends, continued market share gains in propulsion and several boat categories, strong OEM demand for propulsion, components and electronics, favorable changes in foreign currency exchange rates, pricing actions commencing in the second half of 2025, and solid boating participation driving aftermarket performance. For the third consecutive quarter, year-over-year net sales increased across all segments. The Propulsion segment delivered significant sales growth resulting primarily from an improved market, strong OEM orders, wholesale acceleration, and continued global share gains. The Engine P&A segment benefited from healthy boater participation and continued distribution share gains, which led to sales improvement compared to the prior year. Navico Group reported sales growth over the prior year quarter as growth across all business lines was supported by improving OEM demand, steady aftermarket performance, and operational efficiency. Finally, the Boat segment sales grew over prior year driven by higher wholesale shipments and stabilized retail conditions, favorable mix, and continued momentum in the Business Acceleration portfolio. Freedom Boat Club added four new locations, increased trips and improved same store sales. Our international net sales increased 20 percent on a GAAP basis and increased 11 percent on a constant currency basis in the first quarter compared with the prior year.

Current wording

Net sales increased 7.7% during the second quarter of 2026 compared with the second quarter of 2025. Sales growth reflected steady OEM orders, continued strong P&A and aftermarket performance driven by healthy boating participation, pricing taken in previous periods, and improved mix. Adjusted operating earnings and margins increased as the benefits of the higher sales, favorable mix, and strong operating execution, in addition to IEEPA refunds, more than offset inflationary pressures, increased variable compensation, incremental tariffs, and accelerated product development investment. The Propulsion segment delivered sales growth resulting primarily from healthy OEM orders, steady market share, and pricing actions taken in recent quarters. Strong boater participation and continued distribution gains drove higher sales and margin for Engine P&A segment. Navico Group segment reported sales growth over the prior year quarter as growth across all business lines was supported by improving OEM demand, steady aftermarket performance, and improved operational efficiency. Finally, Boat segment grew both sales and margin, benefiting from increased focus on premium and core brands, pricing actions, operational efficiencies, and continued growth in Freedom Boat Club. Freedom Boat Club increased trips and improved same store sales. Our international net sales increased 11 percent on a GAAP basis and increased 7 percent on a constant currency basis in the second quarter.

Previous wording

Operating earnings in the first quarter of 2026 were $50.3 million and $82.6 million on a GAAP and as adjusted basis, respectively. This compares to operating earnings during the first quarter of 2025 of $56.3 million and $72.1 million on a GAAP and As Adjusted basis, respectively. Adjusted operating earnings increased due to increased sales, favorable mix, pricing, improved absorption and disciplined cost management more than offsetting the impact of incremental tariffs implemented after the first quarter of 2025.

Current wording

Operating earnings in the second quarter of 2026 were $129.4 million and $150.1 million on a GAAP and As Adjusted basis, respectively. This compares to operating earnings during the second quarter of 2025 of $103.3 million and $126.0 million on a GAAP and As Adjusted basis, respectively. Adjusted operating earnings increased due to increased sales, favorable mix, pricing, improved absorption, disciplined cost management and IEEPA refunds more than offsetting the impact of incremental tariffs implemented after the first quarter of 2025, variable compensation, and accelerated product development investment.

Previous wording

Changes in Foreign Currency Rates. Percentage changes in net sales expressed in constant currency reflect the impact that changes in currency exchange rates had on comparisons of net sales. To determine this information, net sales transacted in currencies other than the U.S. dollar have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period. The percentage change in net sales expressed on a constant currency basis better reflects the changes in the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Approximately 24 percent of our annual net sales are transacted in a currency other than the U.S. dollar. Our most material exposures include sales in Euros, Canadian dollars, Australian dollars, and Brazilian real.

Current wording

Changes in Foreign Currency Rates. Percentage changes in net sales expressed in constant currency reflect the impact that changes in currency exchange rates had on comparisons of net sales. To determine this information, net sales transacted in currencies other than the U.S. dollar have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period. The percentage change in net sales expressed on a constant currency basis better reflects the changes in the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Approximately 25 percent of our annual net sales are transacted in a currency other than the U.S. dollar. Our most material exposures include sales in Euros, Canadian dollars, Australian dollars, and Brazilian real.

Previous wording

The following table sets forth certain amounts, ratios, and relationships calculated from the Condensed Consolidated Statements of Comprehensive Income for the three months ended:

Current wording

The following table sets forth certain amounts, ratios, and relationships calculated from the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended:

Previous wording

The following is a reconciliation of our non-GAAP measures, adjusted operating earnings and adjusted diluted earnings per common share from continuing operations for the three months ended April 4, 2026 compared with the same prior year comparative period:

Current wording

The following is a reconciliation of our non-GAAP measures, adjusted operating earnings and adjusted diluted earnings per common share from continuing operations for the three and six months ended July 4, 2026 when compared with the same prior year comparative period:

Previous wording

Net sales increased 12.8% during the first quarter of 2026 compared with the same prior year period. The components of the consolidated net sales change were as follows:

Current wording

Net sales increased 7.7% during the second quarter of 2026 compared with the same prior year period. The components of the consolidated net sales change were as follows:

Previous wording

Gross margin remained relatively consistent in the first quarter of 2026 when compared to the same prior year period, driven by increased sales (380 bps) and favorable foreign currency exchange rate fluctuations (60 bps) offset by impact of incremental tariffs (240 bps), labor costs (100 bps), and inflation (100 bps).

Current wording

Gross margin increased 260 bps in the second quarter of 2026 when compared to the same prior year period, driven by increased sales (380 bps), IEEPA refunds (200 bps), lower absorption (40 bps), and favorable foreign currency exchange rate fluctuations (30 bps) offset by material inflation (195 bps), labor costs (130 bps), impact of incremental tariffs (65 bps).

Previous wording

Selling, general and administrative expense as a percentage of net sales increased 60 basis points during the first quarter of 2026 compared with the same prior year period due to increased spending in support of growth and operational initiatives. Research and development expense increased in the first quarter of 2026 versus the same period in 2025 due to accelerated, strategic investments in new products.

Current wording

Selling, general and administrative expense as a percentage of net sales increased 110 basis points during the second quarter of 2026 compared with the same prior year period due to increased spending in support of growth and operational initiatives. Research and development expense increased in the second quarter of 2026 versus the same period in 2025 due to accelerated, strategic investments in new products.

Previous wording

We recorded Restructuring, exit and impairment charges of $4.8 million and $1.1 million during the three months ended April 4, 2026 and March 29, 2025 respectively. First quarter 2026 actions are not expected to result in material annualized cost savings. Refer to Note 3 –Restructuring, Exit, and Impairment Activities in the Notes to Condensed Consolidated Financial Statements for further information.

Current wording

We recorded Restructuring, exit and impairment charges of $7.0 million and $11.8 million during the three and six months ended July 4, 2026, respectively. We recorded Restructuring, exit and impairment charges of $8.0 million and $9.1 million during the three and six months ended June 28, 2025, respectively. First quarter 2026 actions are not expected to result in material annualized cost savings. Refer to Note 3 – Restructuring, Exit, and Impairment Activities in the Notes to Condensed Consolidated Financial Statements for further information.

Previous wording

We recorded Equity earnings of $1.6 million and $2.2 million in the three months ended April 4, 2026 and March 29, 2025, respectively, which were primarily related to our marine and technology-related joint ventures.

Current wording

We recorded Equity earnings of $1.7 million and $3.3 million in the three and six months ended July 4, 2026, respectively, which were primarily related to our marine and technology-related joint ventures. This compares with Equity earnings of $1.7 million and $3.9 million in the three and six months ended June 28, 2025, respectively.

Previous wording

We recognized $(1.6) million and $1.3 million of Other (expense) income, net in the three months ended April 4, 2026, and March 29, 2025, respectively. Other (expense) income, net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other post-retirement benefit costs.

Current wording

We recognized $(1.1) million and $(2.7) million of Other expense, net in the three and six months ended July 4, 2026, respectively. This compares with $(1.4) million and $(0.1) million of Other expense, net in the three and six months ended June 28, 2025, respectively. Other expense, net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other post-retirement benefit costs.

Previous wording

Net interest expense decreased for the three months ended April 4, 2026 compared with the same prior year period. Refer to Note 10 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 – Debt in the Notes to Consolidated Financial Statements in the 2025 Form 10-K.

Current wording

Net interest expense decreased for the three and six months ended July 4, 2026 when compared with the same prior year period due to lower average debt outstanding resulting from debt repayments. Refer to Note 11 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 – Debt in the Notes to Consolidated Financial Statements in the 2025 Form 10-K.

Previous wording

We recognized an Income tax provision for the three months ended April 4, 2026 of $5.9 million compared to $7.9 million for the three months ended March 29, 2025. The effective tax rate, which is calculated as the Income tax provision as a percentage of Earnings before income taxes, was 21.9% and 28.1% for the three months ended April 4, 2026 and March 29, 2025, respectively.

Current wording

We recognized an Income tax (benefit) provision for the three and six months ended July 4, 2026 of $(1.8) million and $4.1 million compared to $15.7 million and $23.6 million for the three and six months ended June 28, 2025, respectively. The effective tax rate, which is calculated as the Income tax provision as a percentage of Earnings before income taxes, was (1.7)% and 3.1% compared to 20.8% and 22.8% for the three and six months ended July 4, 2026 and June 28, 2025, respectively. The three and six months ended July 4, 2026 includes the discrete impact of a state tax law change that extends the carryforward period for R&D tax credits, which resulted in the reversal of a previously recognized valuation allowance position. This resulted in a $24.6 million benefit recorded in Income tax (benefit) provision.

Previous wording

Due to the factors described in the preceding paragraphs, Net earnings from continuing operations and Diluted earnings per common share from continuing operations increased during the three months ended April 4, 2026 compared with the same prior year period.

Current wording

Due to the factors described in the preceding paragraphs, Net earnings from continuing operations and Diluted earnings per common share from continuing operations increased during the three and six months ended July 4, 2026 compared with the same prior year period.

Previous wording

The following table sets forth Propulsion segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:

Current wording

The following table sets forth Propulsion segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:

Previous wording

Propulsion segment's net sales increased in the first quarter of 2026 compared to the first quarter of 2025, primarily driven by an improved market, global share gains, pricing, favorable changes in foreign currency exchange rates, and strong OEM demand heading into selling season.

Current wording

Propulsion segment's net sales increased in the second quarter of 2026 compared to the second quarter of 2025, primarily driven by healthy OEM orders, steady market share and pricing actions taken in recent quarters.

Previous wording

International sales were 39 percent of the Propulsion segment's net sales in the first quarter of 2026 and increased 20 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased 10 percent.

Current wording

International sales were 39 percent of Propulsion segment's net sales in the first half of 2026 and increased 17 percent from prior year on a GAAP basis. On a constant currency basis, international sales increased 10 percent.

Previous wording

The following table sets forth Engine P&A segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:

Current wording

The following table sets forth Engine P&A segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:

Previous wording

International sales were 30 percent of the Engine P&A segment's net sales in the first quarter of 2026 and increased 16 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased 7 percent from the prior year.

Current wording

International sales were 28 percent of Engine P&A segment's net sales in the first half of 2026 and increased 13 percent from prior year on a GAAP basis. On a constant currency basis, international sales increased 7 percent.

Previous wording

Engine P&A segment's operating earnings in the first quarter of 2026 increased compared to the first quarter of 2025, due to higher sales from healthy boating participation and continued distribution share gains.

Current wording

Engine P&A segment's operating earnings in the second quarter of 2026 increased compared to the second quarter of 2025, due to higher sales and IEEPA refunds, offset by variable compensation.

Previous wording

The following table sets forth Navico Group segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:

Current wording

The following table sets forth Navico Group segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:

Previous wording

Navico Group segment's net sales increased in the first quarter of 2026 compared to the first quarter of 2025, as sales increased across all business lines, supported by improving OEM demand, steady aftermarket performance, pricing, favorable changes in foreign currency exchange rates, and operational efficiency.

Current wording

Navico Group segment's net sales increased in the second quarter of 2026 compared to the second quarter of 2025, as sales increased across all business lines, supported by increased OEM demand from new products, share gains, sustained boating participation supporting the aftermarket, and pricing.

Previous wording

International sales were 44 percent of the Navico Group segment's net sales in the first quarter of 2026 and increased 18 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased 8 percent.

Current wording

International sales were 41 percent of the Navico Group segment's net sales in the second quarter of 2026 and increased 1 percent from the prior year on a GAAP basis. On a constant currency basis, international sales decreased 2 percent.

Previous wording

The following table sets forth Boat segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:

Current wording

The following table sets forth Boat segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:

Previous wording

International sales were 22 percent of the Boat segment's net sales in the first quarter of 2026 and increased 21 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased by 14 percent.

Current wording

International sales were 21 percent of the Boat segment's net sales in the second quarter of 2026 and increased 16 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased by 14 percent.

Previous wording

The following table sets forth Corporate/Other results for the three months ended:

Current wording

The following table sets forth Corporate/Other results for the three and six months ended:

Previous wording

Corporate operating loss in the first quarter of 2026 increased compared to the first quarter of 2025 driven by increased spending in support of growth and operational initiatives.

Current wording

Corporate operating loss in the second quarter of 2026 increased compared to the second quarter of 2025 driven by increased spending in support of growth and operational initiatives and increased variable compensation.

Previous wording

Recent accounting pronouncements that have been adopted during the three months ended April 4, 2026, or will be adopted in future periods, are included in Note 1 – Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements.

Current wording

Recent accounting pronouncements that have been adopted during the six months ended July 4, 2026, or will be adopted in future periods, are included in Note 1 – Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements.

Previous wording

Certain statements in this Quarterly Report on Form 10-Q are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, estimates, and projections about Brunswick’s business and by their nature address matters that are, to different degrees, uncertain. Words such as “may,” “could,” “should,” “expect,” "anticipate," "project," "position," “intend,” “target,” “plan,” “seek,” “estimate,” “believe,” “predict,” “outlook,” "will," and similar expressions are intended to identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties that may cause actual results to differ materially from expectations as of the date of this report. These risks include, but are not limited to: the effect of adverse general economic conditions, including rising interest rates, and the amount of disposable income consumers have available for discretionary spending; changes to trade policy and tariffs, including retaliatory tariffs; fiscal and monetary policy changes; adverse capital market conditions; changes in currency exchange rates; competitive pricing pressures; higher energy and fuel costs; managing our manufacturing footprint and operations; loss of key customers; international business risks, geopolitical tensions or conflicts, sanctions, embargoes, or other regulations; actual or anticipated increases in costs, disruptions of supply, or defects in raw materials, parts, or components we purchase from third parties; supplier manufacturing constraints, increased demand for shipping carriers, and transportation disruptions; adverse weather conditions, climate change events and other catastrophic event risks; our ability to develop new and innovative products and services at a competitive price; absorbing fixed costs in production; our ability to meet demand in a rapidly changing environment; public health emergencies or pandemics; our ability to successfully implement our strategic plan and growth initiatives; attracting and retaining skilled labor, implementing succession plans for key leadership and executing organizational and leadership changes; our ability to integrate acquisitions and the risk for associated disruption to our business; the risk that restructuring or strategic divestitures will not provide business benefits; our ability to identify and complete targeted acquisitions; maintaining effective distribution; dealer and customer ability to access adequate financing; inventory reductions by dealers, retailers, or independent boat builders; requirements for us to repurchase inventory; risks related to the Freedom Boat Club franchise business model; outages, breaches, or other cybersecurity events regarding our technology systems, which have affected and could further affect manufacturing and business operations and could result in lost or stolen information and associated rem…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Certain statements in this Quarterly Report on Form 10-Q are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, estimates, and projections about Brunswick’s business and by their nature address matters that are, to different degrees, uncertain. Words such as “may,” “could,” “should,” “expect,” "anticipate," "project," "position," “intend,” “target,” “plan,” “seek,” “estimate,” “believe,” “predict,” “outlook,” "will," and similar expressions are intended to identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties that may cause actual results to differ materially from expectations as of the date of this report. These risks include, but are not limited to: the effect of adverse general economic conditions, including rising interest rates, and the amount of disposable income consumers have available for discretionary spending; changes to trade policy and tariffs, including retaliatory tariffs; fiscal and monetary policy changes; international business risks, geopolitical tensions or conflicts, sanctions, embargoes, or other regulations; adverse capital market conditions; changes in currency exchange rates; competitive pricing pressures; higher energy and fuel costs; managing our manufacturing footprint and operations; loss of key customers; actual or anticipated increases in costs, disruptions of supply, or defects in raw materials, parts, or components we purchase from third parties; supplier manufacturing constraints, increased demand for shipping carriers, and transportation disruptions; adverse weather conditions, climate change events and other catastrophic event risks; our ability to develop new and innovative products and services at a competitive price; absorbing fixed costs in production; our ability to meet demand in a rapidly changing environment; public health emergencies or pandemics; our ability to successfully implement our strategic plan and growth initiatives; attracting and retaining skilled labor, implementing succession plans for key leadership and executing organizational and leadership changes; our ability to integrate acquisitions and the risk for associated disruption to our business; the risk that restructuring or strategic divestitures will not provide business benefits; our ability to identify and complete targeted acquisitions; maintaining effective distribution; dealer and customer ability to access adequate financing; inventory reductions by dealers, retailers, or independent boat builders; requirements for us to repurchase inventory; risks related to the Freedom Boat Club franchise business model; outages, breaches, or other cybersecurity events regarding our technology systems, which have affected and could further affect manufacturing and business operations and could result in lost or stolen information and associated rem…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

The following table sets forth data from our Condensed Consolidated Statements of Cash Flows for the three months ended:

Current wording

The following table sets forth data from our Condensed Consolidated Statements of Cash Flows for the six months ended:

Previous wording

The following table sets forth an analysis of free cash flow for the three months ended:

Current wording

The following table sets forth an analysis of free cash flow for the six months ended:

Previous wording

Net cash used for operating activities of continuing operations in the three months ended April 4, 2026 totaled $63.7 million compared to $13.4 million in the three months ended March 29, 2025. The increase is primarily due to operating results and changes in working capital. Working capital is defined as Accounts and notes receivable, Inventories and Prepaid expenses and other, net of Accounts payable and Accrued expenses as presented in the Condensed Consolidated Balance Sheets, excluding the impact of acquisitions and non-cash adjustments. Accounts and notes receivable increased $118.7 million, due to timing of collections, Accounts payable increased $96.3 million, due to timing of payments, inventory increased $81.8 million due to increased production, and Accrued expenses decreased $44.4 million, due to payment of approximately $80.0 million of the prior year's variable compensation expense which had been accrued as of December 31, 2025.

Current wording

Net cash provided by operating activities of continuing operations in the six months ended July 4, 2026 totaled $251.5 million compared to $309.1 million in the six months ended June 28, 2025. The decrease is primarily due to changes in working capital. Working capital is defined as Accounts and notes receivable, Inventories and Prepaid expenses and other, net of Accounts payable and Accrued expenses as presented in the Condensed Consolidated Balance Sheets, excluding the impact of acquisitions and non-cash adjustments. Accounts and notes receivable increased $42.9 million, due to timing of collections, Accounts payable increased $93.0 million, due to timing of payments, inventory increased $48.1 million due to increased production, and Accrued expenses increased $0.5 million.

Previous wording

Net cash used for investing activities was $55.2 million and primarily related to $57.2 million of capital expenditures. Our capital spending was focused on investments in new products and technologies.

Current wording

Net cash used for investing activities was $117.2 million and primarily related to $98.6 million of capital expenditures and $28.2 million related to the acquisition of another Freedom Boat Club franchise operation and territory. Our capital spending was focused on investments in new products and technologies.

Previous wording

Net cash provided by financing activities was $133.5 million and primarily related to proceeds from issuance of short-term debt, partially offset by dividends paid to common shareholders and common stock repurchases.

Current wording

Net cash used for financing activities was $107.1 million and primarily related to dividends paid to common shareholders and common stock repurchases.

Previous wording

Cash, cash equivalents and marketable securities totaled $278.6 million as of April 4, 2026, an increase of $21.0 million from $257.6 million as of December 31, 2025, and a decrease of $8.9 million from $287.5 million as of March 29, 2025. Total debt as of April 4, 2026, December 31, 2025 and March 29, 2025 was $2,296.4 million, $2,102.2 million and $2,484.1 million, respectively. Our debt-to-capitalization ratio was approximately 59 percent as of April 4, 2026 compared to 56 percent as of December 31, 2025 and 57 percent as of March 29, 2025.

Current wording

Cash, cash equivalents and marketable securities totaled $288.9 million as of July 4, 2026, an increase of $31.3 million from $257.6 million as of December 31, 2025, and a decrease of $27.6 million from $316.5 million as of June 28, 2025. Total debt as of July 4, 2026, December 31, 2025 and June 28, 2025 was $2,100.9 million, $2,102.2 million and $2,274.1 million, respectively. Our debt-to-capitalization ratio was approximately 56 percent as of July 4, 2026 compared to 56 percent as of December 31, 2025 and 54 percent as of June 28, 2025.

Previous wording

There were no borrowings under the Revolving Credit Agreement (Credit Facility) during the three months ended April 4, 2026 and we did not have any borrowings outstanding as of April 4, 2026. Available borrowing capacity under the Credit Facility as of April 4, 2026 totaled $984.0 million, net of $16.0 million of letters of credit outstanding. During the three months ended April 4, 2026, the maximum amount utilized under the CP Program was $540.0 million, and as of April 4, 2026, the Company had $485.0 million of borrowings outstanding under the CP Program. Refer to Note 10 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 - Debt in the Notes to Consolidated Financial Statements in the 2025 Form 10-K, for further details.

Current wording

There were no borrowings under the Revolving Credit Agreement (Credit Facility) during the six months ended July 4, 2026 and we did not have any borrowings outstanding as of July 4, 2026. Available borrowing capacity under the Credit Facility as of July 4, 2026 totaled $983.9 million, net of $16.1 million of letters of credit outstanding. During the six months ended July 4, 2026, the maximum amount utilized under the CP Program was $540.0 million, and as of July 4, 2026, the Company had $290.0 million of borrowings outstanding under the CP Program. Refer to Note 11 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 - Debt in the Notes to Consolidated Financial Statements in the 2025 Form 10-K, for further details.

Previous wording

The Company anticipates approximately $160 million of debt reduction, $200 million of capital expenditures, and share repurchases of at least $50 million for the year.

Current wording

The Company anticipates at least $160 million of debt reduction, $200 million of capital expenditures, and share repurchases of at least $50 million for the year.