Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Part III
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Part IV
Exhibits and Financial Statement Schedules
Form 10-K Summary
Signatures
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Cautionary Statement Regarding Forward-Looking Statements
This report may contain (and verbal statements made by MSA ® Safety Incorporated (MSA) may contain) "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or future financial performance and involve various assumptions, known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks and other factors include, but are not limited to, those listed in this report under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this report. In some cases, you can identify forward-looking statements by words such as “may,” “will,” “should,” “expects,” “intends,” “plans,” "objectives," “anticipates,” “believes,” “estimates,” “predicts,” “potential” or other comparable words. Actual results, performance or outcomes may differ materially from those expressed or implied by these forward-looking statements and may not align with historical performance and events due to a number of factors, including those discussed in the sections of this report described above. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements, and caution should be exercised against placing undue reliance upon such statements, which are based only on information currently available to us and speak only as of the date hereof. We are under no duty to update publicly any of the forward-looking statements after the date of this report, whether as a result of new information, future events or otherwise, except as required by law.
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PART I
Item 1. Business
Overview — MSA Safety Incorporated (the "Company" or "MSA") is the global leader in advanced safety products, technology and solutions. Driven by its singular mission of safety, the Company has been at the forefront of safety innovation since 1914, protecting workers and facility infrastructure around the world across a broad range of diverse end markets while creating sustainable value for shareholders. The Company's comprehensive product line, which is governed by rigorous safety standards across highly regulated industries, is used to protect workers and facility infrastructures around the world in a broad range of markets, including fire service, energy, utility, construction, and industrial manufacturing applications as well as heating, ventilation, air conditioning and refrigeration ("HVAC-R"). The Company's principal product categories are detection, fire service and industrial personal protective equipment ("PPE").
In addition to its principal product categories, MSA continues to deploy and grow its MSA+™ ecosystem, its turnkey approach to MSA hardware, software, and services to simplify and improve safety operations for customers while delivering recurring revenue.
The Company’s leading market positions across various products in our portfolio are supported and enabled by a strong commitment to investing in new product development that continually raises the bar for safety equipment performance, all while upholding an unwavering commitment to integrity. We dedicate significant resources to research and development, which allows us to produce innovative safety products and solutions that are often first to market and usually protected by intellectual property. Our global product development teams include cross-functional associates throughout the Company, including research and development, marketing, sales, operations and quality management. Our engineers and technical associates work closely with the safety industry’s leading standards-setting groups and trade associations to develop industry-specific product standards and to anticipate their impact on our product line.
We leverage the MSA Business System ("MBS") to develop and introduce innovative safety solutions, secure new business opportunities, and operate with greater efficiency. The MBS is our approach to working at our best - at our most efficient and most empowered. It is a combination of behaviors, processes and tools that provide a framework to run the business and continuously improve. We strive to serve our customers and help them solve their safety and compliance challenges while creating value for our shareholders. As part of our differentiated development process, we embed ourselves with our customers to deeply understand their processes, pain points and desired outcomes. Our commitment to MBS has enabled us to drive customer satisfaction and profitable growth while generating significant in operating results.
Segments — We tailor our product and solution offerings and distribution strategy to satisfy distinct customer preferences that vary across geographic regions. To best serve these customer preferences, we have organized our business into four geographic operating segments that are aggregated into two reportable segments: Americas and International. Segment information is presented in Note 9—Segment Information of the consolidated financial statements in Part II Item 8 of this Form 10-K.
Because our consolidated financial statements are stated in U.S. dollars and much of our business is conducted outside the U.S., currency fluctuations may affect our results of operations and financial position and may affect the comparability of our results between financial periods.
Products and solutions — We design, manufacture, and sell a comprehensive line of safety products and solutions to protect workers and facility infrastructures around the world. Our products and solutions protect people and critical infrastructure against a wide variety of hazardous or life-threatening situations.
The following is a brief description of our primary products within each of our Detection, Fire Service and Industrial PPE product categories, each of which we sell in both our Americas and International Segments:
Detection
FGFD systems. Our permanently installed fixed gas and flame detection ("FGFD") products and solutions are used in energy and utility applications, HVAC-R, water and wastewater, food retail and general industrial production facilities to detect the presence or absence of various gases in the air. Typical applications of these systems include detecting combustible or toxic gases as well as leaks of refrigerants. FGFD products and solutions generate a meaningful portion of overall revenue from recurring business including replacement components and related service. Key products and solutions include:
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• Fixed gas detection monitoring systems. This product line is used to monitor for combustible and toxic gases and oxygen deficiency in a wide variety of applications where continuous monitoring is required. Our systems are used for gas detection in energy, pulp and paper, wastewater, refrigerant monitoring, pharmaceutical production and general industrial applications. Some of our flagship products in this category include the Ultima ® X5000 and S5000 gas monitors, which utilize a wide array of sensor technologies to enhance facility and worker safety.
• Flame detectors and open-path infrared gas detectors. These instruments are used for plant-wide monitoring of toxic gases and for detecting the presence of flames. These systems use sensor technology to detect potentially hazardous conditions across long distances, making them suitable for use in applications such as processing industries, storage vessels and HVAC ducts.
• Refrigerant detection and identification . Our refrigerant leak detection monitors, such as the MSA Bacharach ® Multi-Zone Gas Monitor and the MSA Chillgard ® 5000 Refrigerant Leak Monitor, help identify and mitigate refrigerant leaks. Users can enhance their leak detection and mitigation efforts by utilizing MSA+ solutions, like the MSA Parasense Refrigerant Tracking and Compliance software and the MSA Parasense Enterprise Leak Detection software. These solutions provide users with real-time monitoring and alerts.
In 2025, we acquired M&C TechGroup and its affiliated companies ("M&C"). Headquartered in Ratingen, Germany, M&C provides a comprehensive range of gas analysis systems that detect, measure and monitor gases in critical environments. M&C’s product portfolio includes systems and solutions for gas sampling, gas conditioning, as well as advanced process control. Refer to Note 15—Acquisitions to the consolidated financial statements in Part II Item 8 of this Form 10-K for further information.
Portable gas detection instruments. Our handheld portable gas detection instruments are used to detect the presence or absence of various gases in the air. The product line is used by energy, utility, general industrial workers as well as first responders or anyone working in a confined space environment. Our single and multi-gas detectors provide portable solutions for detecting the presence of oxygen, combustible gases and various toxic gases, including hydrogen sulfide, carbon monoxide, ammonia and chlorine, either singularly or up to six gases at once. Our multi-gas detectors include the ALTAIR ® 2X, ALTAIR 4XR and ALTAIR 5X, all of which utilize our internally developed XCell ® sensor technology for fast response times. Our newest multi-gas detectors, the ALTAIR io™ 4 and ALTAIR io 6, are portable gas detection wearables designed with fully integrated connectivity through MSA+ solutions for real-time visibility across worksites.
Fire Service
Breathing apparatus products. The Company's primary breathing apparatus solution is the self-contained breathing apparatus ("SCBA"). SCBA are used by first responders, manufacturing and process industry plant workers and others entering an environment deemed immediately dangerous to life and health. The SCBA functions together with various MSA cloud-based software modules and proprietary accessories to create a complete and customizable solution for our customers. Our primary breathing apparatus product in the Americas segment, the MSA G1 SCBA, is a platform that offers many differentiated features. With new hardware and software upgrades always under development, this platform continues to evolve to meet our customers’ needs. The MSA M1 SCBA, which is our primary breathing apparatus product in the International segment, represents the most advanced and ergonomic SCBA that we have launched in the International markets. The “M” stands for modular, which is a critical design element that allows this platform to meet the needs of customers around the world.
Firefighter helmets and protective apparel. We offer a complete line of fire helmets that includes our Cairns® and Gallet® helmet brands. Our Cairns helmets are primarily used by firefighters in North America while the Gallet helmets are primarily used by firefighters across our International segment. Our Cairns® 1836 Fire Helmet includes embedded radio frequency identification (RFID) technology, providing the ability to quickly locate assets, through MSA’s FireGrid Inventory Management software. Globe Holding Company, LLC ("Globe") and B T Q Limited ("Bristol Uniforms"), two of our subsidiaries, are both leading innovators and providers of firefighter protective apparel products in the Americas segment and International segment, respectively.
Industrial PPE and Other
Industrial head protection. We offer a complete line of industrial head protection and accessories that includes the iconic V-Gard® helmet brand, a bellwether product in MSA's portfolio for over 50 years. We offer customers a wide range of color choices for V-Gard helmets, and we are a leader in the application of customized logos. Our V-Gard H2™ safety helmet incorporates the latest technology to help protect against lateral impacts. The optional Mips ® brain protection system for industrial safety helmets adds another layer of protection designed to help reduce the risk of brain trauma. Our industrial head protection products have a wide user base, including energy, utility, non-residential construction and industrial workers.
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Fall protection. Our broad line of fall protection equipment includes harnesses, lanyards, self-retracting lifelines, engineered systems and confined space equipment. Fall protection equipment is used by workers in the construction, energy, utilities and aerospace industries as well as general industrial applications and anyone working from height in both our Americas and International segments. MSA’s V-Series ® fall protection equipment has transformed the Company’s harness and self-retracting lanyard portfolio, with over 50 fall protection products launched over the past several years. Additionally, our V-TEC ® io1 self-retracting lifeline has a patented smart hook connector that uses radio-frequency identification (RFID) technology to alert wearers when they are not secured to an anchorage point.
Other. Key other products that we sell include air-purifying respirators, eye and face protection, ballistic helmets and gas masks.
Customers — Our customers generally fall into two categories: distributors and end-user customers. In our Americas segment, the majority of our sales are made through distribution. In our International segment, sales are made through both indirect and direct sales channels. For the year ended December 31, 2025, no individual customer represented more than 10% of our sales.
Sales and Distribution — Our sales and distribution team consists of marketing, field sales and customer service organizations. In most geographic areas, our field sales organizations work jointly with select distributors to call on end-users and educate them about hazards, exposure limits, safety requirements and product applications, as well as the specific performance attributes of our products. We believe that understanding end-user requirements is critical to increasing MSA's market share.
The in-depth customer training and education provided by our sales associates to our customers is critical to ensuring proper use of many of our products, such as SCBA and detection instruments. As a result of our sales and marketing associates working closely with end-users, they gain valuable insight into customer preferences and needs. To better serve our customers and to ensure that our sales and marketing associates are among the most knowledgeable and professional in the industry, we place significant emphasis on training our sales associates in product application, industry standards and regulations.
We believe our sales and distribution strategy allows us to deliver a customer value proposition that differentiates our products and solutions from those of our competitors, resulting in increased customer loyalty and demand.
In areas where we use indirect selling to general industry, we promote, distribute and service our products through authorized national, regional and local distributors. In areas where we use indirect selling to fire service, we distribute fire service products primarily through specially trained local and regional distributors who provide advanced training and service capabilities to volunteer and paid municipal fire departments. Because of our broad and diverse product line and our desire to reach as many markets and market segments as possible, we have over 1,800 authorized distributor locations worldwide.
Competition —The global safety products and solutions market is broad and highly fragmented with few participants offering a comprehensive line of safety products and solutions. The sophisticated safety products market in which we compete is a subset of the larger safety market. We maintain leading positions across various products in our portfolio. Over the long-term, we believe global demand for safety products and solutions will continue to grow. Purchases of these products and solutions are non-discretionary, protecting workers' health and critical infrastructure in hazardous and life-threatening work environments. Their use is often mandated by government and industry regulations, which are increasingly enforced on a global basis.
The safety products and solutions market is highly competitive, with participants ranging in size from small companies focusing on a single type of PPE to several large multinational corporations that manufacture and supply many types of sophisticated safety products and solutions. Our main competitors vary by region and product. We believe that participants in this industry compete primarily on the basis of product characteristics (such as functional performance, technology, cost of ownership, comfort, design and style), brand name recognition and after-market service support.
We believe we compete favorably within each of our operating segments and product categories as a result of our high quality, innovative offerings and strong brand trust and recognition.
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Research and Development — To achieve and maintain our market leading positions, we operate several sophisticated research and development facilities. We believe our dedication and commitment to innovation and research and development allows us to produce state-of-the-art safety products and solutions that are often first to market and exceed industry standards. Our primary engineering groups are located in the United States, Germany, France, China and South Africa. Our global product development teams include cross-geographic and cross-functional members from various areas throughout the Company, including research and development, marketing, sales, operations and quality management. These teams are responsible for setting product line strategies based on their understanding of customers' needs and available technology, as well as the opportunities and challenges they foresee in each product area. Our cross-geographical and cross-functional approach to the new product development process allows us to tailor our product offerings and product line strategies to satisfy distinct customer preferences and industry regulations that vary across our operating segments.
We believe another important aspect of our approach to new product development is that our engineers and technical associates work closely with the safety industry’s leading standards-setting groups and trade associations. These organizations include the National Institute for Occupational Safety and Health ("NIOSH"), the National Fire Protection Association ("NFPA"), American National Standards Institute ("ANSI"), International Safety Equipment Association ("ISEA") and their overseas counterparts. Key members of our management team understand the impact that these standard-setting organizations have on our new product development pipeline. As such, management devotes significant time and attention to anticipating a new standard's impact on our sales and operating results. Our understanding of customer needs, membership on global standards-setting bodies, and investment in research and development and our unique new product development process positions us well to anticipate and adapt to changing product standards. While the length of the approval process can be unpredictable, we believe that we are well positioned to gain the approvals and certifications necessary to meet new government and multinational product regulations.
Patents and Intellectual Property — We own significant intellectual property, including a number of domestic and foreign patents, patent applications and trademarks related to our products, processes and business. Although our intellectual property plays an important role in maintaining our competitive position in a number of markets that we serve, no single patent, or patent application, trademark or license is, in our opinion, of such value to us that our business would be materially affected by the expiration or termination thereof, other than the “MSA” trademark. Our patents expire at various times in the future not exceeding 20 years. Our general policy is to apply for patents on an ongoing basis in the United States and other countries, as appropriate, to perfect our patent development. In addition to our patents, we have also developed or acquired a substantial body of manufacturing know-how that we believe provides a significant competitive advantage over our competitors.
Raw Materials and Suppliers — Many of the components of our products are formulated, machined, tooled or molded in-house and by select tier one supplier partners. Material costs comprise approximately two-thirds of our cost of sales. For example, we rely on integrated manufacturing capabilities for breathing apparatus, gas masks, ballistic helmets, hard hats and circuit boards. The primary materials that we source from third parties include electronic components, high density polyethylene, chemical filter media, rubber and plastic components, eye and face protective lenses, air cylinders, certain metals and ballistic resistant, flame resistant and non-ballistic fabrics. We purchase these materials both domestically and internationally, and we work to ensure our supply sources are both well established and reliable. Demand for certain industrial-based electronic components is gradually aligning with supply. For key components, lead times are improving, and market conditions are showing signs of stabilization across the industry. We continue to effectively navigate these supply chain issues, as we have close supplier relationship programs with our key raw material distributors and strategic supplier partners. Although we do not have long-term supply contracts with all suppliers, we have engaged in formal supply agreements with select strategic supplier partners. We work to establish long term agreements with all key partners to ensure a robust supply pipeline and have not experienced any significant problems in obtaining adequate raw materials.
Please refer to MSA's Form SD filed on May 29, 2025, for further information on our conflict minerals analysis. Form SD may be obtained free of charge at www.sec.gov.
Human Capital —As of December 31, 2025, the Company employed approximately 5,300 people worldwide, of which approximately 2,200 were employed in the United States and 3,100 were employed outside of the United States. Approximately 20% of our global workforce is covered by collective bargaining agreements or works councils. Overall, we consider our employee relations to be good. Our culture is important to our success. To that end, we maintain seven core values that define our culture. They are Integrity, Customer Focus, Diversity and Inclusion, Innovation and Change, Engagement, Teamwork, and Speed and Agility. Our core values are encircled by “A Culture of Safety.”
• Workplace Health & Safety —As a company whose mission is dedicated to worker safety, MSA places great emphasis on the health and safety of our own associates. The Company maintains a global Environmental, Health and Safety Management System, deploys a variety of programs to reduce and eliminate injuries and promote safety and regularly measures the progress of those programs. These programs promote personal responsibility for workplace safety and encourage associates to set a meaningful example as safety ambassadors.
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• Employee Health and Well-Being — To support mental health and emotional well-being, all associates and their dependents worldwide have access to an Employee Assistance Program, at no cost to them. This includes access to visits with mental health care providers through the program.
• Culture —The Company seeks a wide variety of thoughts, perspectives, experiences and ideas. MSA strives to provide an inclusive work environment, paired with a culture of excellence in which associates feel comfortable openly sharing thoughts and ideas. Creating an inclusive environment helps to recruit and retain talent, promoting engagement, fostering innovation, and achieving MSA’s business objectives. MSA also partners with a number of non-profit and community-based organizations to help to build a pipeline of future talent with differing backgrounds, thoughts, experiences, and perspectives.
• Leadership and Development —MSA provides programs to enable continuous learning, growth and development opportunities.
First, our "MOVE" (Meaningful, Ongoing, Vital Exchanges) Performance Management philosophy is a core element of associate engagement. Exchanges between associates and supervisors provide a flexible, ongoing feedback loop to drive and enhance the engagement of associates, while facilitating the achievement of our strategic goals.
Second, the MSA Leadership model sets the expectations of MSA people leaders. Grounded in our culture, values and the MBS that define MSA’s high performance culture of excellence, the MSA Leadership model guides the development of current and aspiring leaders. The model is the foundation of leadership development at MSA. By combining leadership development, culture, and business acumen, leaders are better prepared to drive a high-performance culture while maintaining an engaged workforce with opportunities for development and growth.
Beyond these core programs, MSA designs and delivers a variety of associate leadership and development programs to further enhance the associate experience and opportunities for growth. Associates are empowered to own their career development through business-aligned resources, tools and programs.
• Compensation and Rewards —MSA’s global compensation philosophy strives to provide total compensation for all associates at the market median, utilizing base salary, cash incentives and, in some cases, equity grants to achieve this goal. We further strive to provide above-market compensation opportunities for associates who exceed goals and expectations. This approach to total rewards is designed to help MSA attract, retain and motivate high-performing individuals who foster an innovative culture and drive business results.
Environmental Matters — Our facilities and operations are subject to laws and regulations relating to environmental protection and human health and safety. In the opinion of management, compliance with current environmental protection laws will not have a material adverse effect on our financial condition. See Item 1A—Risk Factors, for further information regarding our environmental risks which could impact the Company.
Seasonality — Our operating results are not significantly affected by seasonal factors. During periods of economic expansion or contraction and following significant catastrophes, our sales by quarter have varied. Government-related sales tend to increase in the fourth quarter. Americas segment sales tend to be strong during the energy sector's turnaround seasons late in the first quarter, early in the second quarter and then again at the end of the third quarter and beginning of the fourth quarter. International segment sales are typically weaker for the Europe region in the summer holiday months of July and August and seasonality can be affected by the timing of delivery of larger orders. The fourth quarter is also impacted by holidays which reduces the number of working days and may impact the timing of delivery of orders at year end. Invoicing and the delivery of larger orders can affect sales patterns variably across both reportable segments.
Available Information — Our Internet address is www.MSAsafety.com. We make the following filings available free of charge on the Investor Relations page on our website as soon as they have been electronically filed with or furnished to the Securities and Exchange Commission ("SEC"): our annual reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as well as our proxy statement. Information contained on our website is not part of this annual report on Form 10-K or our other filings with the SEC. The SEC maintains an Internet site at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers like us who file electronically with the SEC.
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Item 1A. Risk Factors
RISKS RELATED TO LEGAL AND REGULATORY CHALLENGES
Claims of injuries or potential safety issues or quality concerns could be made against our various subsidiaries.
Our products and solutions are often used in high-risk and unpredictable environments and our mission, reputation and business success rely on our ability to design and provide safe, high quality and reliable products that earn and maintain customer trust. In the event that those using our products and solutions are injured, or if any of our products or solutions are alleged to have contributed, we could be subject to claims or suffer reputational harm. In addition, we may be required to or may voluntarily recall, redesign, or update certain products, components, or solutions due to concern about product safety, quality, ease of use or customer confidence. We continue to review, update, and execute the Company's quality management processes appropriately to meet changing market demands, technology, and product standards. Any significant claims, recalls or field actions that result in significant expense or publicity us could have a material effect on our business, operating results, financial condition and liquidity, including any claim brought us in excess or outside of available insurance coverage.
Our subsidiaries may experience losses from product liability claims, which could have a material adverse effect on our business, operating results, financial condition and liquidity.
Our subsidiaries face an inherent business risk of exposure to product liability or other legal claims or penalties related to the design, manufacture, marketing, or sale of any of our current or former products and solutions. Our subsidiaries are named periodically in single incident lawsuits, or, at times, in cumulative trauma product liability lawsuits which may be numerous, and the number of claims newly asserted in any given period is difficult to predict and may aggregate or escalate suddenly. Any type of product injury claim may result in losses in excess of limits or beyond the coverage afforded by available insurance and have a material adverse effect on our business, reputation, operating results, financial condition and liquidity.
On January 5, 2023, the Company divested Mine Safety Appliances Company, LLC ("MSA LLC"), a wholly owned subsidiary that holds legacy product liability claims relating to coal dust, asbestos, silica, and other exposures to a joint venture between R&Q Insurance Holdings Ltd. and Obra Capital, Inc. (the "Purchaser"). The transaction is subject to risks related to counterparty commercial risk as well as agreement enforcement and interpretation. Third parties also could seek to assert claims against us for which MSA LLC is the legally responsible party, and we may be required to incur fees and expenses to enforce that wrongly asserted claims are properly redirected to MSA LLC. The divested subsidiary MSA LLC and the Purchaser each have agreed to indemnify us with respect to MSA LLC’s cumulative trauma product liability losses and other defined exposures. The ability of MSA LLC and the Purchaser to honor their indemnity obligations is subject to commercial risk and, in addition, in the event of a dispute, the transaction, negotiated indemnities, and the extent of other legally available protections may be subject to future judicial interpretation. MSA and its remaining subsidiaries continue to be responsible for relating to any current or former products and solutions that were not transferred as part of the .
Our ability to market and sell our products and solutions is subject to existing government laws, regulations and standards. Changes in such laws, regulations and standards or our failure to comply with them could materially and adversely affect our results of operations.
Most of our products are required to meet performance and test standards designed to protect the safety of people and infrastructures around the world, and many of our products and solutions are required to comply with other various laws and regulations in the applicable markets where sold. Our inability to comply with these standards and regulations could result in declines in revenue, profitability and cash flow. Changes in laws, regulations, or the standards themselves, including changes resulting from the outcome of federal, national, state or provincial elections, could reduce the demand for our products or require us to re-engineer our products, thereby creating opportunities for our competitors. Regulatory approvals for our products may be delayed or denied for a variety of reasons that are outside of our control. Additionally, market anticipation of significant new standards can cause customers to accelerate or delay buying decisions.
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We are subject to various federal, state and local laws and regulations across our global organization and any violation of these laws or regulations could adversely affect our results of operations.
We are subject to numerous, and sometimes conflicting, laws and regulations on matters as diverse as anti-corruption, import/export controls, product content requirements, trade restrictions, tariffs, taxation, sanctions, internal and disclosure control obligations, securities regulation, anti-competition, data privacy and security, and labor relations, among others. This includes laws and regulations in emerging markets where legal systems may be less developed or familiar to us. Compliance with diverse legal requirements is costly, time-consuming and requires significant resources, and in some cases may require us to obtain relevant information from our vendors and suppliers, which may be difficult to obtain in a timely manner or at all. In addition, if we are required to transition away from components made with regulated materials, we could incur substantial costs to identify and transition to alternative components or product designs, or where feasible alternatives are not readily available. Violations of one or more of these laws or regulations in the conduct of our business could result in significant fines, criminal prosecution or sanctions and/or civil or civil us or our officers or other personnel, prohibitions on doing business and to our reputation. These actions could result in liability for significant monetary , publicity and other reputational and have a material effect on our business, consolidated results of operations and financial condition.
We are subject to various environmental laws, regulations and ordinances, any violation of which could adversely affect our results of operations.
Included in the extensive laws, regulations and ordinances to which we are subject, are those relating to the protection of the environment. Examples include those governing discharges to water, discharges to air (including greenhouse gas emissions and restrictions to same), handling and disposal practices for solid and hazardous wastes and the maintenance of a safe workplace. These laws impose penalties for noncompliance and liability for response costs and certain damages resulting from past and current spills, disposals, other releases of hazardous materials and other noncompliance with such laws. These environmental laws may continue to change in the future due to a variety of factors, such as government focus on climate change. We could incur substantial costs as a result of noncompliance with or liability for cleanup pursuant to these environmental laws which could have a material adverse effect on our business, consolidated results of operations and financial condition. Such laws continue to change, and we may be subject to more stringent environmental laws in the future. If more environmental laws are enacted, these future laws could have a material effect on our business, consolidated results of operations and financial condition.
We are subject to risks related to our sustainability activities and disclosures.
Sustainability continues to be an evolving area of focus from investors, customers, employees, and lawmakers, who at times may have competing, inconsistent, or varying interests. Regulations at both state and national levels also continue to evolve. The Company anticipates continued stakeholder expectations and changing regulatory requirements, among other demands. Failure to accurately and timely meet these expectations and requirements may result in reputational damage, regulatory penalties and litigation among other consequences.
We are subject to various U.S. and foreign tax laws and any changes in these laws related to the taxation of businesses and resolutions of tax disputes could adversely affect our results of operations.
The U.S. Congress, the Organisation for Economic Co-operation and Development ("OECD") and other government agencies in jurisdictions in which we and our affiliates invest or do business have maintained a focus on issues related to the taxation of multinational companies. The OECD has changed numerous long-standing tax principles through its base erosion and profit shifting project which could adversely impact our effective tax rate.
We are subject to regular review and audit by both foreign and domestic tax authorities. While we believe our tax positions will be sustained, the final outcome of tax audits and related litigation may differ materially from the tax amounts recorded in our consolidated financial statements, which could have a material adverse effect on our consolidated results of operations, financial condition and cash flows.
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RISKS RELATED TO SUPPLY AND MANUFACTURING
Our future results are subject to the risk that purchased components and materials are unavailable or available at excessive cost due to material shortages, tariff changes, excessive demand, currency fluctuation, inflationary pressure and other factors.
We depend on various components, materials and services from supply chain partners to manufacture our products. It is possible that any of our supplier relationships could be terminated or otherwise disrupted, or that our suppliers may be unable to timely deliver quality components, materials or services to us. Any sustained interruption in our receipt of adequate supplies or services could have a material adverse effect on our business, results of operations and financial condition. Our inability to successfully manage price fluctuations or delays due to market demand, unavailability, currency risks or material shortages, or future price fluctuations (whether due to inflationary pressures, tariffs or otherwise) could have a material adverse effect on our business and our consolidated results of operations and financial condition.
Our plans to continue to improve productivity, execute restructuring programs (such as to improve profitability), reduce complexity, and meet other operating objectives may not be successful, which could adversely affect our ability to compete.
MSA periodically evaluates the efficiency of our business, which may result in changes to the way that we operate. MSA runs the risk that these activities and similar initiatives may not be completed substantially as planned, may be more costly to implement than expected, or may not result in the efficiencies or cost savings anticipated. In addition, if not properly managed, these initiatives could cause disruptions in our day-to-day operations and have a negative impact on MSA's financial results. It is also possible that other major productivity and streamlining programs may be required in the future.
We are subject to risks related to various U.S. and foreign climate regulations and any changes in these regulations related to climate disclosure and penalties for non-compliance could adversely affect our results of operations.
The issue of climate variability is receiving increasing attention nationally and worldwide. Some scientific experts are predicting a worsening of weather volatility in the future associated with climate variability. Climate changes that have significant physical effects, such as increased frequency and severity of storms, floods, wildfires, droughts and other climatic events, could have an adverse effect on our supply chain, our business and our consolidated results of operations and financial condition.
Moreover, our operations (and the operations of many of our key suppliers) emit greenhouse gases directly. Restrictions on emissions of methane or carbon dioxide that may be imposed could adversely impact the demand for, price of and value of our products and reserves. For example, current and future laws or regulations limiting such emissions could increase our own costs. As the legal and regulatory environment continues to evolve, it is not possible to accurately estimate how potential future laws or regulations addressing greenhouse gas emissions would impact our business.
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RISKS RELATED TO ECONOMIC, MARKET AND COMPETITIVE CONDITIONS
Unfavorable economic and market conditions could materially and adversely affect our business, results of operations and financial condition.
We are subject to risks arising from adverse changes in global economic conditions. We have significant operations in a number of countries outside the U.S., including some in emerging markets. Long-term economic uncertainty in some of the regions of the world in which we operate, such as Asia Pacific, Latin America, the Middle East and Europe, could result in declines in revenue, profitability and cash flow due to reduced orders, payment delays, supply chain disruptions or other factors caused by the economic challenges faced by our customers, suppliers, and other business partners.
A portion of MSA's sales are made to customers in the energy market. It is possible that volatility in the energy market, whether related to economic, climate-related energy policy, geopolitical tensions or events, or other conditions, could negatively impact our business and could result in declines in our consolidated results of operations and cash flow.
Pandemics or disease outbreaks may cause unfavorable economic or market conditions which could impact demand patterns and/or disrupt global supply chains and manufacturing operations. Collectively, these outcomes could materially and adversely affect our business, results of operations and financial condition.
Pandemics or disease outbreaks could result in a widespread health crisis that could adversely affect the economies of developed and emerging markets, potentially resulting in an economic downturn that could affect customers’ demand for our products and solutions in certain industrial-based end markets. The spread of pandemics or disease outbreaks may also disrupt the Company’s manufacturing operations, supply chain, or logistics necessary to import, export and deliver products and solutions to our customers. During a pandemic or crisis, applicable laws and response directives could, in some circumstances, result in skilled labor impacts including voluntary attrition or difficulty finding labor, or otherwise adversely affect our ability to operate our plants, obtain inputs from suppliers, or to deliver our products in a timely manner. Some laws and directives may also hinder our ability to move certain products across borders. Economic conditions can also influence order patterns. These factors could negatively impact our consolidated results of operations and cash flow.
A reduction in the spending patterns of government customers, prolonged or recurring government shutdowns or reductions in government staffing, or delays in obtaining government approval for our products and solutions could materially and adversely affect our net sales, earnings and cash flow.
The demand for our products and solutions sold to the fire service market, the homeland security market and other government customers is, in large part, driven by available government funding. Government budgets are set annually, and we cannot assure that government funding will be sustained at similar levels in the future. A significant reduction in available government funding or staffing could result in declines in our consolidated results of operations and cash flow. Moreover, our operations rely on timely interactions with government agencies, including but not limited to those that govern our product and regulatory approvals, and prolonged or recurring government shutdowns or staffing reductions could negatively impact our consolidated results of operations and cash flow or regulatory approvals and compliance functions.
The markets in which we operate are highly competitive, and some of our competitors have greater financial and other resources than we do. The competitive pressures faced by us could materially and adversely affect our business, results of operations and financial condition.
The safety products and solutions market is highly competitive, with participants ranging in size from small companies focusing on single types of safety products, to large multinational corporations that manufacture and supply many types of safety products and solutions among other lines of business. Our main competitors vary by region and product. We believe that participants in this industry compete primarily on the basis of product characteristics (such as functional performance, technology, cost of ownership, comfort, design and style), price, service and delivery, integrated solutions, customer support, the ability to meet the special requirements of customers, brand name trust and recognition, purchasing options, and e-business capabilities. Some of our competitors have greater financial and other resources than we do, and our business could be adversely affected by competitors’ new product innovations, technological advances made to competing products and solutions and pricing changes made by us in response to competition from existing or new competitors. We may not be able to compete successfully against current and future competitors, and the competitive pressures faced by us could have a material effect on our business, consolidated results of operations and financial condition. In addition, digital commerce continues to evolve and the execution of a strategy involves significant time, investment and resources. If we are to expand digital commerce capabilities in support of our customer needs, our brands may market share, which could impact revenue and .
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RISKS RELATED TO NEW AND ADJACENT INITIATIVES
Our plans to improve future profitability through restructuring programs may not be successful and could lead to unintended consequences.
We have incurred and may incur restructuring charges primarily related to severance costs for staff reductions associated with initiatives to drive profitable growth and right size our operations from year to year. Our cost structure in future periods is somewhat dependent upon our ability to maintain increased productivity without backfilling certain positions. If our programs are not successful, there could be a material adverse effect on our business and consolidated results of operations.
Our inability to successfully identify, consummate and integrate current and future acquisitions or to realize anticipated cost savings and other benefits could adversely affect our business. Additionally, divestitures may expose us to alleged potential liabilities which could adversely affect our business.
One of our operating strategies is to selectively pursue acquisitions. Any future acquisitions will depend on our ability to identify suitable acquisition candidates and successfully consummate such acquisitions. Acquisitions involve a number of risks including:
• failure of the acquired businesses to achieve the results we expect;
• diversion of our management’s attention from operational matters;
• our inability to retain key personnel of the acquired businesses;
• risks associated with unanticipated or underestimated events or liabilities;
• negative impacts due to evolving legal or regulatory landscape;
• potential disruption of our existing business; and
• customer dissatisfaction or performance problems at the acquired businesses.
If we are unable to integrate or successfully manage businesses that we have recently acquired or may acquire in the future, we may not realize anticipated cost savings, improved manufacturing efficiencies and increased revenue, which may result in material adverse short and long-term effects on our consolidated operating results, financial condition and liquidity. Even if we are able to integrate the operations of our acquired businesses into our operations, we may not realize the full benefits of the cost savings, revenue enhancements or other benefits that we may have expected at the time of acquisition. In addition, even if we achieve the expected benefits, we may not be able to achieve them within anticipated time frames, and such benefits may be offset by costs incurred in integrating the acquired companies and increases in other expenses.
We have also divested businesses and may consider divesting businesses in the future. Divestiture risks relate to our ability to find appropriate purchasers, execute transactions on favorable terms and avoid transaction-related disputes, separate divested business operations with minimal impact to our remaining operations, and effectively manage any transitional service arrangements. Any of these factors could materially and adversely affect our consolidated results of operations and financial condition.
If we fail to introduce successful new products or solutions or extend our existing portfolio, we could lose our market position and our financial performance could be materially and adversely affected.
In the safety products and solutions market, there are frequent introductions of new products, product line extensions, and related technologies and solutions. If we are unable to identify emerging customer and technological trends, maintain and improve the competitiveness of our products and solutions and introduce new ones, we may lose our market position, which could have a material adverse effect on our business, financial condition and results of operations. We continue to invest significant resources in research and development and market research, which includes the development of software platforms for our connected products and solutions. However, continued product and/or service development and marketing efforts are subject to the risks inherent in the development process. These risks include delays, the failure of new products, product line extensions, and related solutions to achieve anticipated levels of market acceptance, disruptive products, technologies and services introduced by competitors, and the risk of failed product introductions.
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RISKS RELATED TO CYBERSECURITY OR MISAPPROPRIATION OF OUR CRITICAL INFORMATION
A failure of our information systems or a cybersecurity breach could materially and adversely affect our business, results of operations and financial condition.
The proper functioning and security of our information systems is critical to the operation and reputation of our business. This also includes the systems that support and operate our GRID, FireGRID, and similar connected products and product platforms. Our information systems may be vulnerable to damage or disruption from natural or man-made disasters, computer viruses, power losses or other system or network failures. In addition, hackers, cyber-criminals and other persons could attempt to gain unauthorized access to our information systems with the intent of harming the Company, harming our information systems or obtaining sensitive information such as intellectual property, trade secrets, financial and business development information, and customer- and vendor-related information. To date, we have not experienced any known material breaches or material related to cyber-attacks. If our information systems or security , or if there is any compromise or of our security, it could our operations, our data and/or data access, and/or result in a of applicable data protection, data security and other laws. Such a could also include legal and financial exposure, remediation costs, impacts on our customers' willingness to transact business with us, or a of confidence in our security measures, which could have an effect on our business, our reputation and our consolidated results of operations and financial condition.
From time to time, we have experienced attempts on our information systems by unauthorized outside parties. Because the techniques used by computer hackers and others to access or sabotage networks continually evolve and generally are not recognized until launched against a target, we may be unable to anticipate, prevent or detect these attacks. As a result, the impact of any future incident cannot be predicted, including the failure of our information systems or misappropriation of our technologies and/or processes. Any such system failure or loss of such information could harm our competitive position or cause us to incur significant costs to remedy the damages caused by the incident. We have taken steps and incurred costs to further strengthen the security of our information systems and continue to assess, maintain and the ongoing effectiveness of our information security systems. While we attempt to mitigate the aforementioned risks by employing a number of measures, including employee training, monitoring of our networks and systems, and maintenance of backup and protective systems, our systems, networks, facilities, business partners, including third party providers, and associates remain potentially to advanced . We cannot that ongoing to our infrastructure and cybersecurity programs will be sufficient to prevent or limit the from any future cyber-attack or to our information systems, even with mitigation protocols and available insurance. It is therefore possible that we may a cyber-attack with a material or material , parties may access to personal information in our possession and we may not be to identify any such in a timely manner.
Our continued success depends on our ability to protect our intellectual property. If we are unable to protect our intellectual property, our business could be materially and adversely affected.
Our success depends, in part, on our ability to obtain and enforce patents, maintain trade secret protection and know-how and operate without infringing on the proprietary rights of third parties . We have been issued patents and have registered trademarks with respect to many of our products, but our competitors could independently develop similar or superior products or technologies, duplicate any of our designs, trademarks, processes or other intellectual property or design around any processes or designs on which we have or may obtain patents or trademark protection. In addition, it is possible that third parties may have, or will acquire, licenses for patents or trademarks that we may use or desire to use, so that we may need to acquire licenses to, or to contest the validity of, such patents or trademarks of third parties. Such licenses may not be made available to us on acceptable terms, if at all, and we may not prevail in contesting the validity of third-party rights.
We also protect trade secrets, know-how and other confidential information against unauthorized use by others or disclosure by persons who have access to them, such as our employees, through contractual arrangements. These agreements may not provide meaningful protection for our trade secrets, know-how or other proprietary information in the event of any unauthorized use, misappropriation or disclosure of such trade secrets, know-how or other proprietary information. Our inability to maintain the proprietary nature of our technologies could have a material adverse effect on our consolidated results of operations and financial condition.
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RISKS RELATED TO HUMAN CAPITAL MANAGEMENT
If we lose any of our key personnel or are unable to attract, train and/or retain qualified employees for our global workforce or properly plan the succession of senior management, our ability to manage our business and continue our growth could be negatively impacted.
Our success depends in large part on the continued contributions of our key personnel within our global workforce, many of whom are highly skilled and would be difficult to replace. Our success also depends on the abilities of personnel to function effectively, both individually and as a group. We compete with other companies both within and outside of our industry in a highly competitive labor market to hire new personnel with a variety of capabilities in the many countries in which we design, manufacture and market our products and solutions.
We also invest resources and time to develop and retain our employees' skills and competencies. We could experience unplanned or increased turnover of employees, face challenges attracting or retaining qualified employees, fail to develop adequate succession plans for leadership positions, or fail to hire and retain a workforce with the skills and in the locations we need to operate and grow our business. We could also fail to attract and develop personnel with key emerging capabilities that we need to continue to respond to changing end user and customer needs and grow our business, including skills in the areas of manufacturing, engineering, sales, service, and various functional support areas. Occurrence of any of these conditions could deplete our institutional knowledge base, erode our competitiveness and hinder our strategic planning and execution including the successful implementation and completion of our company initiatives. The loss of any key employee could result in significant to our operations, including increased costs and time of training, replacement and integration, affecting the timeliness of product releases, the effectiveness of our disclosure controls and procedures, our internal control over financial reporting, and the results of our operations. We are also subject to the effects of labor affecting our third-party partners and service providers.
Additionally, failure to achieve and maintain a diverse workforce, compensate our employees competitively and fairly, maintain a safe and inclusive environment or promote the well-being of our employees could affect our reputation and result in lower performance and an inability to retain valuable employees.
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RISKS RELATED TO DOING BUSINESS INTERNATIONALLY
We have significant international operations, are subject to the risks of doing business in foreign countries and global supply chains, and may be impacted by external factors including those we may be unable to control.
We have business operations in more than 40 international locations. In 2025, approximately 50% of our net sales were made by operations located outside the United States. There is a high level of uncertainty surrounding future global economic conditions due to a number of factors, such as geopolitical uncertainty, including the international impacts of ongoing wars, civil conflict and terrorism, commodity market volatility, potential changes to international trade agreements, the imposition of tariffs and the threat of additional tariffs, natural disasters, pandemics and public health events. We also rely on global supply chains or otherwise source critical components and raw materials from suppliers based in foreign countries, which at times are used in manufacturing operations across our global footprint. In certain cases, components could be sole sourced or otherwise not easily substituted due to the highly regulated or complex nature of our products. Therefore, our operations and sourcing strategies could face supply shortages, supplier or sourcing delays, transportation disruptions, changes in customer demand, or , which could have a material effect on our business, consolidated results of operations and financial condition. As a result of our operations outside the United States, we are subject to certain additional inherent risks including the following:
• Scarcity or unavailability of parts and components necessary to manufacture our products;
• unexpected changes in regulatory requirements;
• changes in trade policy or tariff regulations;
• changes in tax laws and regulations;
• unintended consequences due to changes to the Company's legal structure;
• additional valuation allowances on deferred tax assets due to an inability to generate sufficient profit in certain foreign jurisdictions;
• intellectual property protection difficulties or intellectual property theft;
• difficulty in collecting accounts receivable;
• complications in complying with a variety of foreign laws and regulations, some of which may conflict with U.S. laws;
• foreign privacy laws and regulations that impede our ability to effectively do business;
• trade sanctions and embargoes;
• nationalization and expropriation of assets (or laws that effectively result in the same);
• lack of effective compliance with MSA's anti-bribery policy, the U.S. Foreign Corrupt Practices Act, and similar anti-corruption and anti-bribery laws in the countries where the Company does business;
• the need to take extra security precautions for our international operations;
• risks associated with restricted or delayed access to capital markets on acceptable terms necessary to execute our business strategy, fund operations, refinance existing indebtedness, and pursue strategic opportunities;
• costs and difficulties in managing culturally and geographically diverse international operations; and
• risks associated with disruptive political events and related legal and economic uncertainty.
Any one or more of these risks could have a negative impact on the success of our global operations and, thereby, have a material adverse effect on our business, consolidated results of operations and financial condition.
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Because we derive a significant portion of our sales from the operations of our foreign subsidiaries, future currency exchange rate fluctuations could adversely affect our results of operations and financial condition and could affect the comparability of our results between financial periods.
Our operations outside of the United States account for a significant portion of our net sales. The results of our foreign operations are generally reported in local currency and then translated into U.S. dollars at the applicable exchange rates for inclusion in our consolidated financial statements. The exchange rates between some of these currencies and the U.S. dollar have fluctuated significantly in recent years and may continue to do so in the future. A weakening of the currencies in which sales are generated relative to the currencies in which costs are denominated would decrease our results of operations and cash flow. Although the Company uses instruments to hedge certain foreign currency risks, these hedges only offset a portion of the Company’s exposure to foreign currency fluctuations.
In addition, because our consolidated financial statements are stated in U.S. dollars, such fluctuations may affect our consolidated results of operations and financial position, and they may affect the comparability of our results between financial periods. Our inability to effectively manage our exchange rate risks or any volatility in currency exchange rates could have a material adverse effect on our business, consolidated results of operations and financial condition.
We benefit from free trade laws and regulations, such as the United States-Mexico-Canada Agreement and any changes to these laws and regulations could adversely affect our results of operations.
Existing free trade laws and regulations, such as the United States-Mexico-Canada Agreement, provide certain beneficial duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements. Changes in laws or policies governing the terms of foreign trade and, in particular, increased trade restrictions, tariffs or taxes on imports from countries where we manufacture products, such as China and Mexico, could have a material adverse effect on our business, consolidated results of operations and financial condition.
GENERAL RISK FACTORS
Damage to the reputation of MSA or to one or more of our Company brands could adversely affect our business.
Developing and maintaining our reputation, as well as the reputation of our brands, is a critical factor in our relationship with customers, distributors, end users, suppliers, associates, and others. Our inability to address negative publicity or other issues, including concerns about product safety or quality, real or perceived, could negatively impact our business which could have a material adverse effect on our business, consolidated results of operations and financial condition.
If our goodwill, other intangible assets and long-lived assets become impaired, we may be required to record significant non-cash charges to earnings.
We review our long-lived assets for impairment when events or changes in circumstances indicate the carrying amount may not be recoverable. Goodwill and indefinite-lived intangible assets are required to be assessed for impairment at least annually. Factors that may be considered a change in circumstances, indicating that the carrying amount of our goodwill, indefinite-lived intangible assets or long-lived assets may not be recoverable, include slower growth rates in our markets, reduced expected future cash flows, increased country risk premiums as a result of political uncertainty and a decline in stock price and market capitalization. We consider available current information when calculating our impairment charge. If there are indicators of impairment, our long-term cash flow forecasts for our operations deteriorate or discount rates increase, we may be required to recognize additional non-cash charges in later periods. See Note 14—Goodwill and Intangible Assets of the consolidated financial statements in Part II Item 8 of this Form 10-K for the carrying amounts of goodwill in each of our reportable segments and details on indefinite-lived intangible assets that we hold.
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Failure to effectively harness and/or protect Company data or to incorporate, or improperly incorporating, Artificial Intelligence (AI) could damage our business.
New and emerging technologies, including Generative AI, bring opportunities and risks, and the implications of using (or not using) these technologies continue to rapidly change. Our business is subject to and impacted by these technological advances, and the failure to effectively and/or lawfully deploy these technologies may impact the Company’s business. To remain competitive, we review and enhance our products and solutions against new technologies, including exploring the use of Generative AI. If we fail to anticipate or respond to technological advancements appropriately, the demand for our products and solutions may be diminished. If the Company fails to build and implement an effective data strategy or to procure, adopt, or use new technologies in a way that is efficient and additive to our business, it may have an adverse effect on our business, consolidated results of operations or financial condition. Conversely, there are risks that using new technologies could result in data or disclosure (including but not limited to confidential information), biased algorithms, heightened regulatory compliance obligations, over-dependence, , or outputs, data privacy and cybersecurity risks, ethical , intellectual property risks, and other risks that could lead to reputational or have an effect on our business, consolidated results of operations or financial condition.
Risks related to our defined benefit pension and other post-retirement plans could adversely affect our results of operations and cash flow.
Significant changes in actual investment return on pension assets, discount rates, and other factors could adversely affect our results of operations and pension contributions in future periods. U.S. generally accepted accounting principles require that we calculate income or expense for the plans using actuarial valuations. These valuations reflect assumptions about financial markets and interest rates, which may change based on economic conditions. Funding requirements for our pension plans may become more significant. However, the ultimate amounts to be contributed are dependent upon, among other things, interest rates, underlying asset returns and the impact of legislative or regulatory changes related to pension funding obligations. For further information regarding our pension plans, refer to Note 16—Pensions and Other Post-retirement Benefits of the consolidated financial statements in Part II Item 8 of this Form 10-K.
If we fail to meet our debt service requirements or the restrictive covenants in our debt agreements or if interest rates increase, our results of operations and financial condition could be materially and adversely affected.
We have a substantial amount of debt upon which we are required to make scheduled interest and principal payments and we may incur additional debt in the future. A significant portion of our debt bears interest at variable rates that may increase in the future.
Our debt agreements require us to comply with certain restrictive covenants. If we are unable to generate sufficient cash to service our debt or if interest rates increase, our consolidated results of operations and financial condition could be materially and adversely affected. Additionally, a failure to comply with the restrictive covenants contained in our debt agreements could result in a default, which if not waived by our lenders, could substantially increase borrowing costs and require accelerated repayment of our debt. Please refer to Note 13—Long-Term Debt of the consolidated financial statements in Part II Item 8 of this Form 10-K for commentary on our compliance with the restrictive covenants.
Any period of interest rate increases may adversely affect our ability to obtain new financing or to refinance existing debt on terms the Company deems attractive, the cost of such financing, exchange rates, and our profitability, which in turn may have a material adverse effect on our liquidity and capital resources. As of December 31, 2025, we had $285.3 million of variable rate borrowings on a term loan under our revolving credit facility. A 50 basis point increase or decrease in interest rates could result in $1.9 million of additional interest expense.
Item 1B. Unresolved Staff Comments
None.
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Item 1C. Cybersecurity
Risk Management and Strategy
Managing Material Risks & Integrated Overall Risk Management
We assess, identify, and manage our cybersecurity risks by employing several processes, including conducting employee training, monitoring and testing our networks and systems, responding to vulnerability and threat assessments, and maintaining and refreshing backup and protective systems. Cybersecurity risk management is also a component of our overall Enterprise Risk Management (“ERM”) program. Both the cybersecurity risk management component of the ERM program and associated risk management plans, including risk mitigation, are reviewed at regular intervals and updated as needed. Related reporting to management occurs on a routine basis, and the Board of Directors is updated through an established cadence via the Board’s Audit Committee and the full Board.
The Company has an information security policy, and it provides cybersecurity training to employees on a recurring basis throughout the year. As part of our processes, employees are trained on how to identify and report potential cybersecurity threats. The Company also engages in an ongoing process of risk assessments to identify and mitigate cybersecurity threats. This includes a vulnerability management program where such risks are identified, classified, and addressed. The Company conducts cybersecurity exercises to enhance mitigating controls and incident response preparedness. The Company also has incident response plans in place to address contingencies in the event of a cybersecurity incident.
Engage Third Parties on Risk Management
As part of our cybersecurity risk management process, MSA engages a range of third parties, including consultants, advisors, and auditors, to assist with security and maturity assessments, security operations, employee training and awareness, compliance, penetration testing, network and endpoint monitoring, threat intelligence, and our vulnerability management platform. These relationships enable us to access specialized knowledge and insights with respect to our cybersecurity strategies and processes.
Oversee Third-Party Risk
We are aware of risks associated with third-party service providers, and the Company employs a third-party risk management program that includes a systematic evaluation of potential risks associated with engaging third-party vendors, suppliers or partners that may have access to Company sensitive information, systems, or networks. This process is also intended to provide for the security and integrity of the Company’s data that may be stored on third-party systems. The process identifies and addresses potential security vulnerabilities, safeguarding Company information assets and reducing the overall risk of cyber threats. The Company’s assessments begin during the onboarding of third parties and may continue throughout the relationship, based upon an assessment of third-party risk. Those assessments also include Company audit rights, third-party notification obligations, and security requirements for the retention of Company data. The Company maintains a team consisting of employees, contractors and consultants to oversee this process.
Risks from Cybersecurity Threats
From time to time, we have experienced attempts by unauthorized parties to access or disrupt our information technology systems. To date, we have not experienced any known material breaches or material losses related to cyber-attacks. However, a failure of our information systems or a cybersecurity breach could materially and adversely affect our business, results of operations and financial condition. See Item 1A, “Risks related to Cybersecurity or Misappropriation of Our Critical Information.”
Governance
Board of Directors Oversight
The Audit Committee and the Board of Directors oversee and periodically review the design and effectiveness of the Company’s cybersecurity program, as well as its contingency plans. On an established cadence, the Audit Committee and the Board of Directors are briefed by the Chief Information Security Officer (“CISO”) on the status and progress of the cybersecurity program, as well as on direct or emerging threats to the Company, program maturity and strategy, and third-party risk management. Additionally, the Board of Directors receives ERM program briefings that include cybersecurity risks.
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Management’s Role Managing Risk
Company management is directly involved in assessing and managing risks from cybersecurity threats. The Company employs a CISO with substantial program management experience , along with a team of cybersecurity and IT professionals. The CISO reports to the Chief Information Officer. The Chief Information Officer reports to the Senior Vice President and Chief Product and Technology Officer, who is a member of the Company’s Executive Leadership Team. Additionally, the CISO reports regularly on the cybersecurity program, including risks and mitigation, to the Cybersecurity Executive Steering Body. The Cybersecurity Executive Steering Body provides strategic oversight and is responsible for guiding and aligning organizational efforts to manage risks associated with cybersecurity threats. It is intended to ensure comprehensive risk management, effective policy development, and coordinated response measures to safeguard sensitive information and technology assets.
The Cybersecurity Executive Steering Body includes members of the Executive Leadership Team, among other senior managers, including cross-functional representation from Cybersecurity, Product and Technology, Law, Finance, and Operations departments. Collectively, the Cybersecurity Executive Steering Body has decades of enterprise risk management experience, including cybersecurity risk management.
Monitor Cybersecurity Incidents
The Company’s cybersecurity incident response plan provides a structured approach to prevent, detect, manage and mitigate a cybersecurity incident. Primary goals are to minimize harm to information technology systems and Company information, reduce recovery time, and ensure the continuity of operations. Internal resources manage and execute the Company’s cybersecurity incident response plan with the support of retained external advisors. Plan testing and assessments occur to provide for the ongoing effectiveness against evolving threats. Pursuant to the plan, communication channels and escalation protocols are also maintained to engage and inform internal stakeholders – such as the Cybersecurity Executive Steering Body, corporate crisis management team, and other members of the Executive Leadership Team – of how incidents are prevented, detected, mitigated, and remediated.
The Company’s measures to prevent and detect cyber security incidents include continuous monitoring of Company networks by a security operations team that includes a third-party managed security operations center. Employees throughout the Company are trained to report cybersecurity threats as they are identified. If an incident or suspected incident is reported, the cybersecurity team evaluates it for various factors, including severity and immediacy, pursuant to the Company’s cybersecurity incident response plan.
Reporting to Board of Directors
The CISO regularly informs the Cybersecurity Executive Steering Body of cybersecurity risks and incidents. Accordingly, the highest levels of management are informed of the cybersecurity position and risks, and significant cybersecurity matters are elevated to the Audit Committee of the Board of Directors .
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Item 2. Properties
Our principal executive offices are located at 1000 Cranberry Woods Drive, Cranberry Township, PA, United States. We own or lease our primary facilities. Our primary manufacturing locations in the Americas segment are located in Cranberry Township, PA; Jacksonville, NC; Murrysville, PA; New Kensington, PA; Pittsfield, NH,; and Querétaro, Mexico, and our primary distribution center is located in New Galilee, PA. The primary manufacturing locations in the International segment are located in Berlin, Germany; Bristol, United Kingdom; Ratingen, Germany; Châtillon-sur-Chalaronne, France; Galway, Ireland; Chelalate, Morocco; Suzhou, China and Aach, Germany. Our primary research and development centers are located in Berlin, Germany; Cranberry Township, PA; Suzhou, China; Johannesburg/Cape Town, South Africa; and Châtillon-sur-Chalaronne, France.
We believe that all of our facilities, including the manufacturing facilities, are in good repair and in suitable condition for the purposes for which they are used.
Item 3. Legal Proceedings
Please refer to Note 21—Contingencies to the consolidated financial statements in Part II Item 8 of this Form 10-K.
Item 4. Mine Safety Disclosures
Not applicable.
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Information about our Executive Officers
The following sets forth the names and ages of our executive officers as of February 12, 2026:
Name
Age
Title
Steven C. Blanco (a)
President and Chief Executive Officer since May 2024.
Julie A. Beck (b)
Sr. Vice President, Chief Financial Officer and Treasurer since August 2025.
David J. Howells (c)
Sr. Vice President and President, International since June 2024.
Richard W. Roda (d)
Vice President, Secretary and Chief Legal Officer since June 2023.
Stephanie L. Sciullo (e)
Sr. Vice President and President, Americas since June 2023.
a. Prior to his present position, Mr. Blanco served as President and Chief Operating Officer since June 2023; Sr. Vice President and President, MSA Americas segment since June 2022; and Vice President and President, MSA Americas segment since August 2017.
b. Prior to her present position, Ms. Beck served as Sr. Vice President and Chief Financial Officer of Terex Corp. (a global industrial equipment manufacturer of materials processing machinery, waste and recycling solutions, mobile elevating work platforms and equipment for the electric utility industry) from January 2022 until February 2025, and as Sr. Vice President of Terex Corp. from November 2021 through December 2021; and prior thereto served as Sr. Vice President and Chief Financial Officer of NOVA Chemicals since February 2016.
c. Prior to his present position, Mr. Howells served as Interim President, MSA International since February 2024; Vice President, International Sales and Customer Marketing since August 2021; Vice President and Business Leader EMEA since January 2020; Interim Vice President and General Manager, MEAIRR since September 2019; and prior thereto served as Vice President, Global Distribution Channels since October 2017.
d. Prior to his present position, Mr. Roda served as Deputy General Counsel, Secretary and Chief Compliance Officer since January 2020; and prior thereto served as Associate General Counsel, Corporate Secretary and Chief Compliance Officer since December 2016.
e. Prior to her present position, Ms. Sciullo served as Sr. Vice President and Chief Legal Officer, Corporate Social Responsibility & Public Affairs since June 2022; Vice President and Chief Legal Officer since January 2020; and prior thereto served as Deputy General Counsel since 2016.
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PART II
Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Our common stock is traded on the New York Stock Exchange under the symbol “MSA.” On February 6, 2026, there were 128 registered holders of our shares of common stock. A substantially greater number of holders of our common stock are “street name” or beneficial holders, whose shares are held by banks, brokers and other financial institutions.
Issuer Purchases of Equity Securities
Period
Total Number of Shares Purchased
Average Price Paid Per Share
Total Number of Shares Purchased as Part of Publicly Announced
Plans or Programs
Maximum Number of Shares that May Yet Be Purchased
Under the Plans or Programs
October 1 — October 31, 2025
November 1 — November 30, 2025
December 1 — December 31, 2025
The share repurchase program authorizes up to $200.0 million in repurchases of MSA common stock in the open market and in private transactions. The share repurchase program has no expiration date. The maximum number of shares that may be purchased is calculated based on the dollars remaining under the program and the respective month-end closing share price. We have purchased a total of 667,712 shares, or $109.9 million, since this program's inception. We do not have any other share repurchase programs.
The above shares purchased during the quarter, excluding those related to the share repurchase program, related to stock-based compensation transactions.
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Comparison of Five-Year Cumulative Total Return
The following paragraph compares the most recent five-year performance of MSA stock with (1) the Standard & Poor’s 500 Composite Index, (2) S&P Midcap 400 Index and (3) S&P Midcap 400 Industrials. Because our competitors are principally privately held concerns or subsidiaries or divisions of corporations engaged in multiple lines of business, we do not believe it feasible to construct a peer group comparison on an industry or line-of-business basis. The S&P 500 Composite Index, S&P Midcap 400 Index and the S&P Midcap 400 Industrials, while including corporations both larger and smaller than MSA in terms of market capitalization, is composed of corporations with an average market capitalization similar to us.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
ASSUMES INITIAL INVESTMENT OF $100
Among MSA Safety Incorporated, the S&P 500 Index, S&P Midcap 400, and S&P Midcap 400 Industrials
Assumes $100 invested on December 31, 2020, in stock or index, including reinvestment of dividends. Fiscal year ending December 31. We have selected in a prior year the S&P Midcap 400 Index as the broad equity market index that includes companies that are of comparable market capitalization to MSA Safety to replace the S&P 500 Index, and as such, the S&P 500 Index shown in the graph above and table below will not be presented in future years.
Value at December 31,
MSA Safety Incorporated
S&P 500 Index
S&P Midcap 400
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Item 6. [Reserved]
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis should be read in conjunction with the historical financial statements and other financial information included elsewhere in this annual report on Form 10-K. This discussion may contain forward-looking statements that involve risks and uncertainties. The forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed in the sections of this annual report entitled “Forward-Looking Statements” and “Risk Factors.”
This section generally discusses the results of our operations for the year ended December 31, 2025, compared to the year ended December 31, 2024. For a discussion on the year ended December 31, 2024, compared to the year ended December 31, 2023, please refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission on February 14, 2025.
MSA Safety Incorporated ("MSA") is organized into four geographical operating segments that are aggregated into two reportable segments: Americas and International. The Americas segment is comprised of our operations in North America and Latin America geographies. The International segment is comprised of our operations of all geographies outside of the Americas. Certain global expenses are allocated to each segment in a manner consistent with where the benefits from the expenses are derived. Please refer to Note 9—Segment Information of the consolidated financial statements in Part II Item 8 of this Form 10-K for further information.
On May 6, 2025, we acquired M&C TechGroup and its affiliated companies ("M&C") in a transaction valued at approximately $189 million, net of cash acquired. Headquartered in Ratingen, Germany, M&C provides a comprehensive range of gas analysis systems that detect, measure and monitor gases in critical environments. M&C’s product portfolio includes systems and solutions for gas sampling, gas conditioning, as well as advanced process control. Refer to Note 15—Acquisitions to the consolidated financial statements in Part II Item 8 of this Form 10-K for further information.
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BUSINESS OVERVIEW
MSA is the global leader in advanced safety products, technology and solutions. Driven by its singular mission of safety, the Company has been at the forefront of safety innovation since 1914, protecting workers and facility infrastructure around the world across a broad range of diverse end markets while creating sustainable value for shareholders.
We tailor our product and solution offerings and distribution strategy to satisfy distinct customer preferences that vary across geographic regions. To best serve these customer preferences, we have organized our business into four geographical operating segments that are aggregated into two reportable segments: Americas and International. In 2025, 67% and 33% of our net sales were made by our Americas and International segments, respectively.
Americas . Our largest manufacturing and research and development facilities are located in the United States. We serve our markets across the Americas with manufacturing facilities in the U.S., Mexico and Brazil. Operations in the other countries within the Americas segment focus primarily on sales and distribution in their respective home country markets.
International . Our International segment includes companies in Europe, the Middle East and Africa ("EMEA") and the Asia Pacific region. In our largest International subsidiaries (in Germany, France, U.K., Ireland and China), we develop, manufacture and sell a wide variety of products. In China, the products manufactured are sold primarily in China as well as in regional markets. Operations in other International segment countries focus primarily on sales and distribution in their respective home country markets. Although some of these companies may perform limited production, most of their sales are of products manufactured in our plants in Germany, France, the U.S., U.K., Ireland, Mexico, Morocco and China or are purchased from third-party vendors.
Corporate . Corporate expenses not allocated to the reportable segments consist of general and administrative expenses incurred in our corporate headquarters, costs associated with corporate development initiatives, legal expense, interest expense, foreign exchange gains or losses and other centrally-managed costs. General and administrative costs and overhead comprise the majority of the corporate related expenses. During the years ended December 31, 2025, and 2024, corporate expenses were $43.4 million and $50.4 million, respectively. The decrease is related to lower professional service fees and variable compensation as well as other discretionary expense management partially offset by inflation.
We leverage the MSA Business System ("MBS") to develop and introduce innovative safety solutions, secure new business opportunities, and operate with greater efficiency. The MBS is our approach to working at our best - at our most efficient and most empowered. It is a combination of behaviors, processes and tools that provide a framework to run the business and continuously improve. Our commitment to MBS has enabled us to drive customer satisfaction and profitable growth while generating significant improvements in operating results.
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Year Ended December 31, 2025, Compared to Year Ended December 31, 2024
Net Sales
Dollar
Increase
Percent
Increase
(In millions)
Consolidated
Americas
International
Net Sales. Net sales for the year ended December 31, 2025, were $1.87 billion, an increase of $66.7 million from $1.81 billion for the year ended December 31, 2024. Please refer to the Net Sales table below for a reconciliation of the year over year sales change.
Net Sales
Year Ended December 31, 2025, versus December 31, 2024
(Percent Change)
Americas
International
Consolidated
GAAP reported sales change
Currency translation effects
Less: Acquisitions
Organic sales change
Note: Organic sales change is a non-GAAP financial measure. See the "Non-GAAP Financial Measures" section below.
Net sales for the Americas segment were $1.26 billion for the year ended December 31, 2025, an increase of $15.2 million, or 1.2%, compared to $1.25 billion for the year ended December 31, 2024. Organic sales in the Americas segment increased 0.5% compared to the prior year. This increase was driven by double digit growth in detection and a minor increase in industrial PPE partially offset by a decrease in fire service partly due to a shift in Assistance to Firefighters Grant (AFG) funding as well as the 2025 U.S. federal government shutdown. M&C added $13.0 million of sales to the Americas segment during the period.
Net sales for the International segment were $613.0 million for the year ended December 31, 2025, an increase of $51.5 million, or 9.2%, compared to $561.5 million for the year ended December 31, 2024. Organic sales in the International segment increased 1.4% compared to the prior year period. This increase was driven by growth in detection primarily in China and Europe and to a lesser extent industrial PPE partially offset by a modest decline in fire service due to budgetary shifts within key European markets. M&C added $27.9 million of sales to the International segment during the period.
The operating environment continues to be dynamic with an uncertain macroeconomic and geopolitical climate. We expect to generate full-year mid-single digit organic sales growth in 2026. We anticipate ongoing momentum in detection and fall protection as key growth drivers, as well as SCBA, which should benefit, in part, from the timing delays in 2025 that shifted some business to 2026. Furthermore, pricing actions in 2025 and 2026, along with moderate volume growth, should also support our outlook. Overall backlog remains healthy, and we have a solid commercial pipeline. Our overall book-to-bill was slightly below one and above the year-ago period.
Refer to Note 9—Segment Information to the consolidated financial statements in Part II Item 8 of this Form 10-K, for information regarding sales by product category.
Gross profit. Gross profit for the year ended December 31, 2025, was $871.1 million, an increase of $10.7 million, or 1.2%, compared to $860.4 million for the year ended December 31, 2024. The ratio of gross profit to net sales was 46.5% in 2025 compared to 47.6% in 2024. The decrease in gross profit margin is primarily related to inflation, transactional foreign currency challenges, tariffs and additional amortization related to the M&C acquisition partially offset by price realization, product mix and improved productivity.
Selling, general and administrative expenses. Selling, general and administrative ("SG&A") expenses were $414.3 million for the year ended December 31, 2025, an increase of $19.6 million, or 5.0%, compared to $394.7 million for the year ended December 31, 2024. Selling, general and administrative expenses were 22.1% of net sales in 2025 compared to 21.8% of net sales in 2024. Organic SG&A decreased $8.6 million, or 2.2%, driven primarily by the absence of the net cost for a product related legal matter from the prior year, lower variable compensation, discretionary expense management and lower professional service costs partially offset by inflation and higher sales commission expense on double-digit detection growth.
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Selling, general, and administrative expenses
Year Ended
December 31, 2025, versus December 31, 2024
(Percent Change)
Consolidated
GAAP reported change
Currency translation effects
Less: Acquisitions and related strategic transaction costs
Organic change
Note: Organic SG&A change is a non-GAAP financial measure. See the "Non-GAAP Financial Measures" section below.
Research and development expense. Research and development expense was $65.3 million for the year ended December 31, 2025, a decrease of $1.2 million, or 1.8%, compared to $66.5 million for the year ended December 31, 2024. Research and development expense was 3.5% of net sales in 2025, compared to 3.7% of net sales in 2024.
We capitalized $14.9 million and $13.0 million of software development costs during the years ended December 31, 2025, and 2024, respectively. Amortization expense for capitalized software development cost of $12.0 million and $11.3 million during the years ended December 31, 2025, and 2024, was recorded in costs of products sold on the Consolidated Statements of Income. Refer to Note 1—Significant Accounting Policies of the consolidated financial statements in Part II Item 8 of this Form 10-K for further details regarding our software development costs.
MSA remains committed to dedicating significant resources to research and development activities, including the development of technology-based safety solutions. As we continue to invest a significant portion of our new product development into technology-based safety solutions, we anticipate that the historical relationship of research and development expense to net sales will continue to evolve; however, we do not anticipate reductions in the relative level of total spend on research and development activities on an annual basis. Total spend on both software development and research and development activities was $80.2 million and $79.5 million during the years ended December 31, 2025, and 2024.
Restructuring charges. During the year ended December 31, 2025, the Company recorded restructuring charges of $3.9 million primarily related to initiatives to right-size the organization in response to macroeconomic conditions and ongoing initiatives to optimize our manufacturing footprint and improve productivity. This compared to restructuring charges of $6.4 million during the year ended December 31, 2024, primarily related to our ongoing initiatives to optimize our manufacturing footprint and improve productivity as well as management restructuring. We remain focused on executing programs to optimize our cost structure.
Currency exchange . Currency exchange losses were $15.8 million during the year ended December 31, 2025, compared to $3.6 million during the year ended December 31, 2024. In 2025 and 2024, we recognized non-cash net cumulative translation gains of $0.8 million and $1.2 million, respectively, associated with certain foreign subsidiaries. The remaining currency exchange activity for both periods related primarily to foreign currency exposure on unsettled inter-company balances and recognized exchange loss for our Argentina affiliate operating in a hyper-inflationary environment.
Refer to Note 19—Derivative Financial Instruments of the consolidated financial statements in Part II Item 8 of this Form 10-K for information regarding our currency exchange rate risk management strategy.
GAAP operating income. Consolidated operating income for the year ended December 31, 2025, was $371.8 million compared to $389.2 million for the year ended December 31, 2024. The decrease in operating results was primarily driven by increased SG&A expenses and currency exchange losses, partially offset by higher sales and lower restructuring charges as discussed further above.
Adjusted operating income. Americas adjusted operating income for the year ended December 31, 2025, was $364.8 million, a decrease of $15.3 million, or 4%, compared to $380.1 million for the year ended December 31, 2024. The decrease in adjusted operating income is attributable to lower gross profit and higher SG&A expenses.
International adjusted operating income for the year ended December 31, 2025, was $93.3 million, an increase of $8.7 million, or 10%, compared to adjusted operating income of $84.6 million for the year ended December 31, 2024. The increase in adjusted operating income is primarily attributable higher sales volumes, including the contribution from M&C, and discretionary cost management partially offset by higher SG&A expense due to inflationary pressures.
Corporate expenses for the year ended December 31, 2025, were $43.4 million, a decrease of $7.0 million, or 14%, compared to $50.4 million for the year ended December 31, 2024, driven by lower professional service fees and variable compensation as well as other discretionary expense management partially offset by inflation.
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The following tables represent a summary of adjusted operating income (loss), adjusted operating margin %, adjusted EBITDA and adjusted EBITDA %. Adjusted operating margin % is calculated as adjusted operating income divided by net sales and adjusted EBITDA margin % is calculated as adjusted EBITDA divided by net sales.
(In thousands)
Americas
International
Total Reportable Segments
Corporate
Consolidated
Year ended December 31, 2025
Net sales
GAAP operating income
Adjusted operating income (loss)
Adjusted operating margin %
Adjusted EBITDA
Adjusted EBITDA %
Year ended December 31, 2024
Net sales
GAAP operating income
Adjusted operating income (loss)
Adjusted operating margin %
Adjusted EBITDA
Adjusted EBITDA %
Note: Adjusted operating income (loss), adjusted operating margin %, adjusted EBITDA and Adjusted EBITDA margin % are non-GAAP financial measures and operating ratios derived from non-GAAP financial measures. Refer to Note 9—Segment Information to the consolidated financial statements in Part II Item 8 of this Form 10-K for reconciliation of total adjusted operating income from reportable segments to income before income taxes and table below for reconciliation of adjusted EBITDA to net income. See also the "Non-GAAP Financial Information" section below.
A reconciliation of total adjusted EBITDA and total adjusted operating income from reportable segments to net income is presented in the following table:
Year ended December 31,
(In thousands)
Adjusted EBITDA from reportable segments
Less:
Depreciation and amortization
Adjusted operating income from reportable segments
Less:
Corporate expenses
Currency exchange losses, net
Acquisition-related amortization
Restructuring charges (Note 4)
Net cost for product-related legal matter
Transaction costs (a)
GAAP operating income
Less:
Interest expense
Other income, net (Note 17)
Income before income taxes
Provision for income taxes (Note 11)
Net income
(a) Transaction costs include advisory, legal, accounting, valuation, and other professional or consulting fees incurred during our evaluation of or in connection with acquisitions and divestitures. These costs are included in Selling, general and administrative expense in the Consolidated Statements of Operations.
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Total other expense, net. Total other expense, net, for the year ended December 31, 2025, was $5.4 million, a decrease of $8.8 million compared to $14.2 million for the year ended December 31, 2024, driven primarily by decreased interest expense related to lower interest rates as well as increased pension income driven by a higher expected rate of return. We expect total interest expense for 2026 to be in the range of $28 million to $31 million. This decrease for 2026 is primarily related to significant long-term debt payments made during 2025. We expect non-cash pension and other post-retirement benefits income to increase by $4 million to $5 million compared to 2025.
Income taxes. The reported effective tax rate for the year ended December 31, 2025, was 23.9% compared to 24.0% for the year ended December 31, 2024. The decrease from the prior year was primarily driven by a decrease in state income taxes, partially offset by one-time benefits in foreign jurisdictions in 2024.
The Organization for Economic Co-operation and Development (OECD) framework for a global minimum corporate tax rate of 15% for companies with global revenues above €750.0 million (referred to as Pillar 2), with effective dates beginning in January 2024, has been enacted by a number of foreign jurisdictions. We meet the overall revenue threshold and fall within the scope of Pillar 2. As such, we have complied with the requirements of the legislation and the application of Pillar 2 resulted in additional tax expense of $2.2 million and $1.1 million, for the years ended December 31, 2025 and 2024, respectively.
We are subject to regular review and audit by both foreign and domestic tax authorities. While we believe our tax positions will be sustained, the final outcome of tax audits and related litigation may differ materially from the tax amounts recorded in our consolidated financial statements.
Net income . Net income was $278.9 million for the year ended December 31, 2025, or $7.09 per diluted share, compared to $285.0 million, or $7.21 per diluted share, for the year ended December 31, 2024.
Non-GAAP Financial Measures
This report includes certain non-GAAP financial measures and operating ratios derived from non-GAAP financial measures. These financial measures and ratios include organic (referred to in our historical filings as constant currency) sales change, organic SG&A change, adjusted operating income, adjusted operating margin %, adjusted EBITDA and adjusted EBITDA margin %.
Organic sales and SG&A change are non-GAAP financial measures provided by the Company to give a better understanding of the Company's underlying business performance. Organic sales and SG&A change are calculated by deducting the percentage impact from currency translation effects as well as the impact from acquisitions and divestitures completed in the preceding 12 months from the overall percentage change in net sales and SG&A. The Company believes that organic sales and SG&A change are useful metrics for investors, as foreign currency translation can have a material impact on revenue and SG&A trends. Organic sales and SG&A change highlight ongoing business performance excluding the impact of fluctuating foreign currencies, acquisitions and divestitures.
Adjusted operating income, adjusted operating margin %, adjusted EBITDA and adjusted EBITDA margin % are non-GAAP financial measures and operating ratios derived from non-GAAP measures. Total reportable segment adjusted operating income is reconciled above to the nearest GAAP financial measure, operating income, and excludes restructuring, currency exchange, product liability expense, loss on divestiture of MSA LLC, net cost for product related legal matter, transaction costs and acquisition-related amortization. Total reportable segment adjusted EBITDA is reconciled above to the nearest GAAP financial measure, net income and, in addition to the items summarized above that are excluded from adjusted operating income (loss), excludes depreciation and amortization expense; interest expense; other income, net; and provision for income taxes. Adjusted operating margin % is defined as adjusted operating income (loss) divided by net sales to external customers and adjusted EBITDA margin % is defined as adjusted EBITDA divided by net sales to external customers. Management uses these measures internally to assess and better understand our underlying business performance and trends related to core business activities as well as to make strategic decisions about the business and allocate resources. Additionally, these non-GAAP financial measures provide information useful to investors in understanding our operating performance and trends, and to facilitate comparisons with the performance of our peers.
The non-GAAP financial measures and key performance indicators we use, and computational methods with respect thereto, may differ from the non-GAAP financial measures and key performance indicators, and computational methods, that our peers use to assess their performance and trends. The presentation of these non-GAAP financial measures does not comply with U.S. GAAP. These non-GAAP financial measures should be viewed as supplemental in nature, and not as a substitute for, or superior to, our reported results prepared in accordance with GAAP.
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LIQUIDITY AND CAPITAL RESOURCES
Our main source of liquidity is operating cash flows, supplemented by borrowings. Our principal liquidity requirements are for working capital, capital expenditures, principal and interest payments on debt, dividend payments and share repurchases. At December 31, 2025, approximately 51% of our long-term debt is at fixed interest rates with repayment schedules through 2036. The remainder of our long-term debt is at variable rates on an unsecured revolving credit facility due in 2030. At December 31, 2025, approximately 81% of our borrowings are denominated in US dollars, which limits our exposure to currency exchange rate fluctuations.
We believe MSA's healthy balance sheet and access to significant capital at the year ended December 31, 2025, positions us well to navigate through a dynamic operating environment and other unexpected events. We maintain a balanced capital deployment strategy that focuses on investing for organic growth and pursuing inorganic growth opportunities, returning cash to shareholders in the form of dividends and share buybacks.
At December 31, 2025, the Company had cash and cash equivalents totaling $165.1 million. Cash and cash equivalents increased $0.5 million during the year ended December 31, 2025, compared to increasing $18.1 million during the same period in 2024. At December 31, 2025, $1.0 billion of the existing $1.3 billion revolving credit facility was unused, including letters of credit issued under the facility.
Operating activities. Operating activities provided cash of $363.9 million in 2025, compared to providing $296.4 million in 2024. The increased cash flow from operating activities was primarily related to lower cash used for variable compensation, income and other taxes, and restructuring as compared to the prior year partially offset by higher cash usage for working capital needs.
Investing activities. Investing activities used cash of $257.6 million for the year ended December 31, 2025, compared to using $53.8 million in 2024. The acquisition of M&C for $189 million and capital expenditures of $68.4 million, including a $19.6 million strategic footprint investment, drove the increase in cash outflows from investing activities during the year ended December 31, 2025. We remain committed to evaluating acquisition opportunities that will allow us to continue to grow in key end markets and geographies.
Financing activities. Financing activities used cash of $105.5 million for the year ended December 31, 2025, compared to using cash of $208.7 million in 2024. During 2025, we had net proceeds from long-term debt of $67.3 million, used primarily to fund the M&C acquisition, compared to net payments of $94.3 million during the same period in 2024. We paid cash dividends of $82.3 million during 2025, compared to $78.8 million during 2024. We used cash of $90.0 million during 2025 to repurchase shares, including $80.0 million related to our share repurchase program compared to using $37.3 million during 2024, including $29.9 million related to our share repurchase program. The remainder in both periods related to our employee stock compensation transactions.
CUMULATIVE TRANSLATION ADJUSTMENTS
The position of the U.S. dollar relative to international currencies, primarily the euro and British pound, at December 31, 2025, resulted in a translation gain of $68.3 million being recorded to cumulative translation adjustments shareholders' equity account for the year ended December 31, 2025, compared to a translation loss of $42.5 million being recorded to the cumulative translation adjustments account during 2024.
COMMITMENTS AND CONTINGENCIES
We are obligated to make future payments under various contracts, including debt and lease agreements. Our significant cash obligations as of December 31, 2025, are as follows:
(In millions)
Total
Thereafter
Long-term debt (principal)
Long-term debt (fixed rate interest)
Operating leases
Totals
The significant obligations table does not include obligations to taxing authorities due to uncertainty surrounding the ultimate settlement of amounts and timing of these obligations. We expect to meet our future debt service obligations through cash provided by operations.
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The Company had outstanding bank guarantees and standby letters of credit with banks as of December 31, 2025 totaling $9.7 million, of which $1.5 million relate to the senior revolving credit facility. These letters of credit serve to cover customer requirements in connection with certain sales orders and insurance companies. The Company is also required to provide cash collateral in connection with certain arrangements. At December 31, 2025, the Company has $0.9 million of restricted cash in support of these arrangements.
We expect to make net contributions between $8 million and $10 million to our pension plans in 2026, which are primarily associated with our International segment. We have not been required to make contributions to our U.S. based qualified defined benefit pension plan in many years.
We have purchase commitments for materials, supplies, services and property, plant and equipment as part of our ordinary conduct of business.
Please refer to Note 21—Contingencies to the consolidated financial statements in Part II Item 8 of this Form 10-K for further discussion on the Company's product liabilities.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
We prepare our consolidated financial statements in accordance with U.S. generally accepted accounting principles (U.S. GAAP). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosures. We evaluate these estimates and judgments on an on-going basis based on historical experience and various assumptions that we believe to be reasonable under the circumstances. However, different amounts could be reported if we had used different assumptions and in light of different facts and circumstances. Actual amounts could differ from the estimates and judgments reflected in our consolidated financial statements. A summary of the Company's significant accounting policies is included in Note 1—Significant Accounting Policies to the consolidated financial statements in Part II, Item 8 of this Form 10-K.
The more critical judgments and estimates used in the preparation of our consolidated financial statements are discussed below.
Business Combinations. In accordance with the accounting guidance for business combinations, the Company uses the acquisition method of accounting to allocate costs of acquired businesses to the assets acquired and liabilities assumed based on their estimated fair values at the dates of acquisition. The excess costs of acquired businesses over the fair values of the assets acquired and liabilities assumed will be recognized as goodwill. The valuations of the acquired assets and liabilities will impact the determination of future operating results. In addition to using management estimates and negotiated amounts, the Company uses a variety of information sources to determine the estimated fair values of acquired assets and liabilities including: third-party appraisals for the estimated value and lives of identifiable intangible assets and property, plant and equipment; third-party actuaries for the estimated obligations of defined benefit pension plans and similar benefit obligations; and legal counsel or other experts to assess the obligations associated with legal, environmental and other contingent liabilities.
The business and technical judgment of management was used in determining which intangible assets have indefinite lives and in determining the useful lives of finite-lived intangible assets in accordance with the accounting guidance for goodwill and other intangible assets.
Income taxes. We recognize deferred tax assets and liabilities using enacted tax rates to record the tax effect of temporary differences between the book and tax basis of recorded assets and liabilities. We record valuation allowances to reduce deferred tax assets to the amounts that we estimate are probable to be realized. When assessing the need for valuation allowances, we consider projected future taxable income and prudent and feasible tax planning strategies. Should a change in circumstances lead to a change in our judgments about the realizability of deferred tax assets in future years, we adjust the related valuation allowances in the period that the change in circumstances occurs.
We record an estimated income tax liability based on our best judgment of the amounts likely to be paid in the various tax jurisdictions in which we operate. We record tax benefits related to uncertain tax positions taken or expected to be taken on a tax return when such benefits meet a more likely than not threshold. We recognize interest related to unrecognized tax benefits in interest expense and penalties in operating expenses. The tax liabilities ultimately paid are dependent on a number of factors, including the resolution of tax audits, and may differ from the amounts recorded. Tax liabilities are adjusted through income when it becomes probable that the actual liability differs from the amount recorded.
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Pensions and other post-retirement benefits. We sponsor certain pension and other post-retirement benefit plans. Accounting for the net periodic benefit costs and credits for these plans requires us to estimate the cost of benefits to be provided well into the future and to attribute these costs over the expected work life of the employees participating in these plans. These estimates require our judgment about discount rates used to determine these obligations, expected returns on plan assets, rates of future compensation increases, rates of increase in future health care costs, participant withdrawal and mortality rates and participant retirement ages. Differences between our estimates and actual results may significantly affect the cost of our obligations under these plans and could cause net periodic benefit costs and credits to change materially from year-to-year. Discount rates and plan asset valuations are point-in-time measures. The discount rate assumptions used in determining projected benefit obligations for our U.S. and foreign plans were based on the spot rate method at December 31, 2025. Expected returns on plan assets are based on capital market expectations by asset class.
The following table summarizes the impact of changes in significant actuarial assumptions on our December 31, 2025, actuarial valuations:
Impact of Changes in Actuarial Assumptions
Change in Discount
Rate
Change in Expected
Return
Change in Market Value of Assets
(In thousands)
(Decrease) increase in net benefit cost
(Decrease) increase in projected benefit obligation
Increase (decrease) in funded status
Goodwill and Indefinite-lived Intangible Assets. On October 1 st of each year, or more frequently if indicators of impairment exist or if a decision is made to sell a business, we evaluate goodwill for impairment. Such indicators may include a decline in expected cash flows, a significant adverse change in the business climate, unanticipated competition, slower growth rates, or negative developments in equity and credit markets, among others.
All goodwill is assigned to and evaluated for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment. The $731.6 million of goodwill on our Consolidated Balance Sheet as of December 31, 2025, is primarily comprised of $480.4 million at the Northern North America reporting unit and $247.8 million at the Europe reporting unit. The evaluation of impairment involves using either a qualitative or quantitative approach as outlined in Accounting Standards Codification ("ASC") Topic 350. In 2025, we performed a quantitative test at October 1, 2025. Quantitative testing involves comparing the estimated fair value of each reporting unit to its carrying value. We estimate reporting unit fair value using a weighted average of fair values determined by discounted cash flow ("DCF") and market approach methodologies, as we believe both are important indicators of fair value. A number of assumptions and estimates are involved in the application of the DCF model, including sales volumes and prices, costs to produce, tax rates, capital spending, discount rates, and working capital changes. Cash flow forecasts are generally based on approved business unit operating plans for the early years and historical relationships in later years. The market approach methodology measures value through an analysis of peer companies. The analysis entails measuring the multiples of EBITDA at which peer companies are trading.
In the event the carrying value is in excess of the estimated fair value of a reporting unit per the weighted average of the DCF and market approach models, an impairment loss equal to such excess would be recognized, which could materially and adversely affect reported consolidated results of operations and shareholders’ equity. At October 1, 2025, based on our quantitative test, the fair values of each of our reporting units exceeded their respective carrying value by at least 46%.
The intangible asset with an indefinite life is also subject to impairment testing on October 1 st of each year, or more frequently if indicators of impairment exist. The impairment test compares the fair value of the intangible asset with its carrying amount. We perform a quantitative assessment of the indefinite lived trade name intangible asset as outlined in ASC 350 by comparing the estimated fair value of the trade name intangible asset to its carrying value. We estimate the fair value using the relief from royalty income approach. A number of significant assumptions and estimates are involved in the application of the relief from royalty model, including sales volumes and prices, royalty rates and tax rates. Forecasts are based on sales generated by the underlying trade name assets and are generally based on approved business unit operating plans for the early years and historical relationships in later years. At October 1, 2025, based on our quantitative test, the fair value of the trade name asset exceeded its carrying value by 53%.
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RECENTLY ISSUED ACCOUNTING STANDARDS AND DISCLOSURE RULES
In November 2024, the FASB issued ASU No. 2024-03 (“ASU 2024-03”), Disaggregation of Income Statement Expenses (“DISE”) . ASU 2024-03 requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. As revised by ASU No. 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures , the provisions of ASU 2024-03 are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. With the exception of expanding disclosures to include more granular income statement expense categories, we do not expect the adoption of ASU 2024-03 to have a material effect on our consolidated financial statements taken as a whole.
In September 2025, the FASB issued ASU No. 2025-06 (“ASU 2025-06”), Targeted Improvements to the Accounting for Internal-Use Software . ASU 2025-06 amends certain aspects of the accounting for a disclosure of software costs under ASC 350-40. ASU 2025-06 makes targeted improvements to ASC 350-40, but does not fully align the framework for accounting for internally developed software costs that are subject to ASC 350-40 with the framework applied to software to be sold or marketed externally that is subject to ASC 985-20. ASU 2025-06 also does not amend the guidance on costs of software licenses that are within the scope of ASC 985-20. ASU 2025-06’s amendments are effective for all entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. The Company is still evaluating the impact that the adoption of ASU 2025-06 will have on the condensed consolidated financial statements.
In November 2025, the FASB issued ASU 2025‑09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements . The amendments are intended to improve the clarity, operability, and decision‑usefulness of hedge accounting guidance. ASU 2025‑09 is effective for the Company for annual and interim reporting periods beginning after December 15, 2026 with early adoption permitted. The Company is currently evaluating the impact of ASU 2025‑09 on its consolidated financial statements and related disclosures. Because the guidance primarily relates to hedge accounting mechanics and presentation, the Company does not expect the adoption of this update to have a material effect on our consolidated financial statements taken as a whole.
