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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2025
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____ TO ____
Commission file number 0-21220

ALAMO GROUP INC.
(Exact name of registrant as specified in its charter)
Delaware |  | 74-1621248
(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)

1627 East Walnut, Seguin, Texas 78155
(Address of principal executive offices, including zip code)
830-379-1480
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol(s) | Name of each exchange on which registered
| Common Stock, par value $.10 per share | ALG | New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer | ☒ | Accelerated filer | ☐
Non-accelerated filer | ☐ | Smaller reporting company | ☐
|  | Emerging growth company | ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
At October 31, 2025, 12,115,428 shares of common stock, $.10 par value, of the registrant were outstanding.

1

Alamo Group Inc. and Subsidiaries
INDEX

PART I. | FINANCIAL INFORMATION | PAGE
Item 1. | Interim Condensed Consolidated Financial Statements (Unaudited) |
| Interim Condensed Consolidated Statements of Income | 3
|  | Three and Nine Months Ended September 30, 2025 and September 30, 2024 |
| Interim Condensed Consolidated Statements of Comprehensive Income | 4
|  | Three and Nine Months Ended September 30, 2025 and September 30, 2024 |
| Interim Condensed Consolidated Balance Sheets | 5
|  | September 30, 2025 and December 31, 2024 |
| Interim Condensed Consolidated Statements of Stockholders' Equity | 6
|  | Three and Nine Months Ended September 30, 2025 and September 30, 2024 |
| Interim Condensed Consolidated Statements of Cash Flows | 8
|  | Nine Months Ended September 30, 2025 and September 30, 2024 |
| Notes to Interim Condensed Consolidated Financial Statements | 9
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 18
Item 3. | Quantitative and Qualitative Disclosures About Market Risks | 24
Item 4. | Controls and Procedures | 24
PART II. | OTHER INFORMATION | 25
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Item 3. | Defaults Upon Senior Securities |
Item 4. | Mine Safety Disclosures |
Item 5. | Other Information |
Item 6. | Exhibits |
| SIGNATURES | 27

2

Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Income
(Unaudited)

| Three Months Ended September 30, |  | Nine Months Ended September 30,
(in thousands, except per share amounts) | 2025 |  | 2024 |  | 2025 |  | 2024
Net sales: |  |  |  |  |  |  |
Vegetation Management | $ | 173,059 |  |  | $ | 190,115 |  |  | $ | 515,307 |  |  | $ | 625,397 |
Industrial Equipment | 246,983 |  |  | 211,186 |  |  | 714,758 |  |  | 617,793 |
Total net sales | 420,042 |  |  | 401,301 |  |  | 1,230,065 |  |  | 1,243,190 |
Cost of sales | 318,359 |  |  | 300,414 |  |  | 917,249 |  |  | 922,490 |
Gross profit | 101,683 |  |  | 100,887 |  |  | 312,816 |  |  | 320,700 |
Selling, general and administrative expenses | 59,931 |  |  | 56,747 |  |  | 171,397 |  |  | 178,158 |
Amortization expense | 4,210 |  |  | 4,061 |  |  | 12,337 |  |  | 12,175 |
Income from operations | 37,542 |  |  | 40,079 |  |  | 129,082 |  |  | 130,367 |
Interest expense | (3,897) |  |  | (4,886) |  |  | (10,775) |  |  | (17,075) |
Interest income | 1,522 |  |  | 562 |  |  | 3,955 |  |  | 1,877 |
Other income (expense), net | (210) |  |  | (32) |  |  | (4,056) |  |  | 1 |
Income before income taxes | 34,957 |  |  | 35,723 |  |  | 118,206 |  |  | 115,170 |
Provision for income taxes | 9,574 |  |  | 8,318 |  |  | 29,917 |  |  | 27,321 |
Net Income | $ | 25,383 |  |  | $ | 27,405 |  |  | $ | 88,289 |  |  | $ | 87,849 |
Net income per common share: |  |  |  |  |  |  |
Basic | $ | 2.11 |  |  | $ | 2.29 |  |  | $ | 7.35 |  |  | $ | 7.34 |
Diluted | $ | 2.10 |  |  | $ | 2.28 |  |  | $ | 7.31 |  |  | $ | 7.30 |
Average common shares: |  |  |  |  |  |  |
Basic | 12,029 |  |  | 11,977 |  |  | 12,013 |  |  | 11,965 |
Diluted | 12,094 |  |  | 12,041 |  |  | 12,075 |  |  | 12,035 |
Dividends declared | $ | 0.30 |  |  | $ | 0.26 |  |  | $ | 0.90 |  |  | $ | 0.78 |

See accompanying notes.
3

Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Comprehensive Income
(Unaudited)

| Three Months Ended September 30, |  | Nine Months Ended September 30,
(in thousands) | 2025 |  | 2024 |  | 2025 |  | 2024
Net income | $ | 25,383 |  |  | $ | 27,405 |  |  | $ | 88,289 |  |  | $ | 87,849 |
Other comprehensive income (loss), net of tax: |  |  |  |  |  |  |
Foreign currency translation adjustments, net of tax (expense) and benefit of $(526) and $(128), and $(2,363) and $259, respectively | (7,328) |  |  | 13,825 |  |  | 31,555 |  |  | 1,044 |
Recognition of deferred pension and other post-retirement benefits, net of tax expense of $(59) and $(69), and $(176) and $(206), respectively | 200 |  |  | 235 |  |  | 601 |  |  | 705 |
Unrealized loss on derivative instruments, net of tax benefit of $6 and $824, and $624 and $627, respectively | (21) |  |  | (2,815) |  |  | (2,131) |  |  | (2,142) |
Other comprehensive income (loss), net of tax | (7,149) |  |  | 11,245 |  |  | 30,025 |  |  | (393) |
Comprehensive income | $ | 18,234 |  |  | $ | 38,650 |  |  | $ | 118,314 |  |  | $ | 87,456 |

See accompanying notes.
4

Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Balance Sheets
(Unaudited)

(in thousands, except share amounts) | September 30, 2025 | December 31, 2024
ASSETS |  |  |  |  |  |
Current assets: |  |  |  |  |  |
Cash and cash equivalents |  | $ | 244,806 |  |  |  | $ | 197,274 |  |
Accounts receivable, net |  | 335,210 |  |  |  | 305,561 |  |
Inventories, net |  | 378,166 |  |  |  | 343,363 |  |
Prepaid expenses and other current assets |  | 9,758 |  |  |  | 11,206 |  |
Income tax receivable |  | 11,453 |  |  |  | 91 |  |
Total current assets |  | 979,393 |  |  |  | 857,495 |  |
Rental equipment, net |  | 61,558 |  |  |  | 52,942 |  |
Property, plant and equipment |  | 380,895 |  |  |  | 365,608 |  |
Less: Accumulated depreciation |  | (215,008) |  |  |  | (207,276) |  |
Total property, plant and equipment, net |  | 165,887 |  |  |  | 158,332 |  |
Goodwill |  | 214,429 |  |  |  | 203,027 |  |
Intangible assets, net |  | 147,322 |  |  |  | 151,360 |  |
Deferred income taxes |  | 1,119 |  |  |  | 1,118 |  |
Other non-current assets |  | 25,271 |  |  |  | 26,005 |  |
Total assets |  | $ | 1,594,979 |  |  |  | $ | 1,450,279 |  |
LIABILITIES AND STOCKHOLDERS’ EQUITY |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |
Trade accounts payable |  | $ | 129,297 |  |  |  | $ | 84,505 |  |
Income taxes payable |  | — |  |  |  | 13,259 |  |
Accrued liabilities |  | 76,770 |  |  |  | 77,537 |  |
Current maturities of long-term debt and finance lease obligations |  | 15,000 |  |  |  | 15,008 |  |
Total current liabilities |  | 221,067 |  |  |  | 190,309 |  |
Long-term debt and finance lease obligations, net of current maturities |  | 194,430 |  |  |  | 205,473 |  |
Long-term tax liability |  | 471 |  |  |  | 626 |  |
Other long-term liabilities |  | 24,423 |  |  |  | 24,619 |  |
Deferred income taxes |  | 21,982 |  |  |  | 10,998 |  |
Total liabilities |  | 462,373 |  |  |  | 432,025 |  |
Stockholders’ equity: |  |  |  |  |  |
Common stock, $0.10 par value, 20,000,000 shares authorized; 12,072,308 and 12,017,308 outstanding at September 30, 2025 and December 31, 2024, respectively |  | 1,207 |  |  |  | 1,202 |  |
Additional paid-in-capital |  | 153,704 |  |  |  | 146,866 |  |
Treasury stock, at cost; 82,600 shares at September 30, 2025 and December 31, 2024, respectively |  | (4,566) |  |  |  | (4,566) |  |
Retained earnings |  | 1,033,831 |  |  |  | 956,347 |  |
Accumulated other comprehensive loss |  | (51,570) |  |  |  | (81,595) |  |
Total stockholders’ equity |  | 1,132,606 |  |  |  | 1,018,254 |  |
Total liabilities and stockholders’ equity |  | $ | 1,594,979 |  |  |  | $ | 1,450,279 |  |

See accompanying notes.
5

Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Stockholders’ Equity
(Unaudited)

For nine months ended September 30, 2025
| Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stock- holders’ Equity
(in thousands) | Shares | Amount
Balance at December 31, 2024 | 11,935 |  | $ | 1,202 |  | $ | 146,866 |  | $ | (4,566) |  | $ | 956,347 |  | $ | (81,595) |  | $ | 1,018,254 |
Other comprehensive income | — |  | — |  | — |  | — |  | 31,800 |  | 9,558 |  | 41,358 |
Stock-based compensation expense | — |  | — |  | 2,303 |  | — |  | — |  | — |  | 2,303 |
Stock-based compensation transactions | 29 |  | 3 |  | (1,262) |  | — |  | — |  | — |  | (1,259) |
Dividends paid ($0.30 per share) | — |  | — |  | — |  | — |  | (3,595) |  | — |  | (3,595) |
Balance at March 31, 2025 | 11,964 |  | $ | 1,205 |  | $ | 147,907 |  | $ | (4,566) |  | $ | 984,552 |  | $ | (72,037) |  | $ | 1,057,061 |
Other comprehensive income | — |  | — |  | — |  | — |  | 31,106 |  | 27,616 |  | 58,722 |
Stock-based compensation expense | — |  | — |  | 2,367 |  | — |  | — |  | — |  | 2,367 |
Stock-based compensation transactions | 16 |  | 1 |  | 846 |  | — |  | — |  | — |  | 847 |
Dividends paid ($0.30 per share) | — |  | — |  | — |  | — |  | (3,601) |  | — |  | (3,601) |
Balance at June 30, 2025 | 11,980 |  | $ | 1,206 |  | $ | 151,120 |  | $ | (4,566) |  | $ | 1,012,057 |  | $ | (44,421) |  | $ | 1,115,396 |
Other comprehensive income (loss) | — |  | — |  | — |  | — |  | 25,383 |  | (7,149) |  | 18,234 |
Stock-based compensation expense | — |  | — |  | 3,693 |  | — |  | — |  | — |  | 3,693 |
Stock-based compensation transactions | 10 |  | 1 |  | (1,109) |  | — |  | — |  | — |  | (1,108) |
Dividends paid ($0.30 per share) | — |  | — |  | — |  | — |  | (3,609) |  | — |  | (3,609) |
Balance at September 30, 2025 | 11,990 |  | $ | 1,207 |  | $ | 153,704 |  | $ | (4,566) |  | $ | 1,033,831 |  | $ | (51,570) |  | $ | 1,132,606 |

See accompanying notes.
6

For nine months ended September 30, 2024
| Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stock- holders’ Equity
(in thousands) | Shares | Amount
Balance at December 31, 2023 | 11,882 |  | $ | 1,196 |  | $ | 137,791 |  | $ | (4,566) |  | $ | 852,859 |  | $ | (54,517) |  | $ | 932,763 |
Other comprehensive income (loss) | — |  | — |  | — |  | — |  | 32,120 |  | (6,459) |  | 25,661 |
Stock-based compensation expense | — |  | — |  | 2,125 |  | — |  | — |  | — |  | 2,125 |
Stock-based compensation transactions | 31 |  | 4 |  | (894) |  | — |  | — |  | — |  | (890) |
Dividends paid ($0.26 per share) | — |  | — |  | — |  | — |  | (3,103) |  | — |  | (3,103) |
Balance at March 31, 2024 | 11,913 |  | $ | 1,200 |  | $ | 139,022 |  | $ | (4,566) |  | $ | 881,876 |  | $ | (60,976) |  | $ | 956,556 |
Other comprehensive income (loss) | — |  | — |  | — |  | — |  | 28,324 |  | (5,179) |  | 23,145 |
Stock-based compensation expense | — |  | — |  | 2,633 |  | — |  | — |  | — |  | 2,633 |
Stock-based compensation transactions | 14 |  | 1 |  | 492 |  | — |  | — |  | — |  | 493 |
Dividends paid ($0.26 per share) | — |  | — |  | — |  | — |  | (3,111) |  | — |  | (3,111) |
Balance at June 30, 2024 | 11,927 |  | $ | 1,201 |  | $ | 142,147 |  | $ | (4,566) |  | $ | 907,089 |  | $ | (66,155) |  | $ | 979,716 |
Other comprehensive income | — |  | — |  | — |  | — |  | 27,405 |  | 11,245 |  | 38,650 |
Stock-based compensation expense | — |  | — |  | 2,427 |  | — |  | — |  | — |  | 2,427 |
Stock-based compensation transactions | 4 |  | — |  | 42 |  | — |  | — |  | — |  | 42 |
Dividends paid ($0.26 per share) | — |  | — |  | — |  | — |  | (3,115) |  | — |  | (3,115) |
Balance at September 30, 2024 | 11,931 |  | $ | 1,201 |  | $ | 144,616 |  | $ | (4,566) |  | $ | 931,379 |  | $ | (54,910) |  | $ | 1,017,720 |

See accompanying notes.
7

Alamo Group Inc. and Subsidiaries
Interim Condensed Consolidated Statements of Cash Flows
(Unaudited)

| Nine Months Ended September 30,
(in thousands) | 2025 |  | 2024
Operating Activities |  |  |
Net income | $ | 88,289 |  |  | $ | 87,849 |
Adjustment to reconcile net income to net cash provided by operating activities: |  |  |
Provision for doubtful accounts | (46) |  |  | 1,234 |
Depreciation - Property, plant and equipment | 20,144 |  |  | 20,027 |
Depreciation - Rental equipment | 8,719 |  |  | 7,257 |
Amortization of intangibles | 12,337 |  |  | 12,175 |
Amortization of debt issuance | 527 |  |  | 527 |
Stock-based compensation expense | 8,363 |  |  | 7,185 |
Provision for deferred income tax | 8,681 |  |  | (2,406) |
Gain on sale of property, plant and equipment | (489) |  |  | (789) |
Changes in operating assets and liabilities: |  |  |
Accounts receivable | (18,815) |  |  | 4,847 |
Inventories | (24,382) |  |  | 5,451 |
Rental equipment | (17,235) |  |  | (15,259) |
Prepaid expenses and other assets | 6,200 |  |  | (1,583) |
Trade accounts payable and accrued liabilities | 37,156 |  |  | (804) |
Income taxes payable | (24,860) |  |  | 3,172 |
Long-term tax payable | (156) |  |  | (1,925) |
Other long-term liabilities, net | (2,009) |  |  | 3,684 |
Net cash provided by operating activities | 102,424 |  |  | 130,642 |
Investing Activities |  |  |
Acquisitions, net of cash acquired | (17,582) |  |  | — |
Purchase of property, plant and equipment | (25,400) |  |  | (18,988) |
Proceeds from sale of property, plant and equipment | 1,064 |  |  | 2,906 |
Net cash used in investing activities | (41,918) |  |  | (16,082) |
Financing Activities |  |  |
Borrowings on bank revolving credit facility | 50,000 |  |  | 187,000 |
Repayments on bank revolving credit facility | (50,000) |  |  | (187,000) |
Principal payments on long-term debt and finance leases | (11,257) |  |  | (11,317) |
Contingent consideration payment from acquisition | — |  |  | (4,402) |
Dividends paid | (10,805) |  |  | (9,329) |
Proceeds from exercise of stock options | 1,502 |  |  | 1,589 |
Common stock repurchased | (3,022) |  |  | (1,944) |
Net cash used in financing activities | (23,582) |  |  | (25,403) |
Effect of exchange rate changes on cash and cash equivalents | 10,608 |  |  | (1,038) |
Net change in cash and cash equivalents | 47,532 |  |  | 88,119 |
Cash and cash equivalents at beginning of the year | 197,274 |  |  | 51,919 |
Cash and cash equivalents at end of the period | $ | 244,806 |  |  | $ | 140,038 |
Cash paid during the period for: |  |  |
Interest | $ | 10,742 |  |  | $ | 17,349 |
Income taxes | 45,939 |  |  | 29,004 |

See accompanying notes.
8

Alamo Group Inc. and Subsidiaries
Notes to Interim Condensed Consolidated Financial Statements - (Unaudited)
September 30, 2025
1. Basis of Financial Statement Presentation
General
The accompanying unaudited interim condensed consolidated financial statements of Alamo Group Inc. and its subsidiaries (the “Company”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulations S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. The balance sheet at December 31, 2024 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2024 (the "2024 10-K").
Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. This ASU will result in the required additional disclosures being included in our consolidated financial statements.
In November 2024, the FASB issued ASU No. 2024-03, Expense Disaggregation Disclosures (Subtopic 220-40). The ASU requires disaggregated Income Statement Expenses. The ASU is effective for annual periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is also permitted. This ASU will result in the required additional disclosures being included in our consolidated financial statements, once adopted.
2. Business Combinations
On June 30, 2025, the Company acquired 100% of the outstanding membership interests in Ring-O-Matic, LLC (“Ring-O-Matic”) for approximately $17.6 million. Ring-O-Matic is a leading provider of trailer-mounted industrial vacuum excavation equipment. The purpose of the acquisition was to expand our current product offerings and to achieve cost and revenue synergies within our Industrial Equipment division. The Company has included the opening balance sheet for Ring-O-Matic in its consolidated financial statements; however, the impact to the consolidated balance sheet was immaterial.
3. Accounts Receivable
Accounts receivable is shown net of sales discounts and the allowance for credit losses.
At September 30, 2025 the Company had $10.6 million in reserves for sales discounts compared to $14.2 million at December 31, 2024 related to products shipped to our customers under various promotional programs.
9

4. Inventories
Inventories are stated at the lower of cost or net realizable value. Net inventories consist of the following:

(in thousands) | September 30, 2025 | December 31, 2024
Finished goods |  | $ | 347,543 |  |  |  | $ | 317,169 |  |
Work in process |  | 22,838 |  |  |  | 21,310 |  |
Raw materials |  | 7,785 |  |  |  | 4,884 |  |
Inventories, net |  | $ | 378,166 |  |  |  | $ | 343,363 |  |

Inventory obsolescence reserves were $11.6 million at September 30, 2025 and $8.3 million at December 31, 2024.
5. Rental Equipment
Rental equipment is shown net of accumulated depreciation of $23.7 million and $25.0 million at September 30, 2025 and December 31, 2024, respectively. The Company recognized depreciation expense of $2.9 million and $2.4 million for the three months ended September 30, 2025 and 2024, respectively, and $8.7 million and $7.3 million for the nine months ended September 30, 2025 and 2024, respectively.
6. Fair Value Measurements
The carrying values of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses, approximate their fair value because of the short-term nature of these items. The carrying value of our debt approximates the fair value as of September 30, 2025 and December 31, 2024. This conclusion was made based on Level 2 inputs. Fair values determined by Level 2 utilize inputs that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Derivative Instruments and Hedging Activities
The Company records all derivatives in accordance with ASC 815, Derivatives and Hedging, which requires derivative instruments to be reported on the condensed consolidated balance sheets at fair value and establishes criteria for designation and effectiveness of hedging relationships. The Company is exposed to market risk such as changes in foreign currencies and interest rates. The Company does not hold or issue derivative financial instruments for trading purposes.
The Company may periodically utilize derivative instruments such as foreign currency or interest rate swaps in the normal course of business to partially offset exposure. The related gains and losses are reported as a component of accumulated other comprehensive loss ("AOCL") in the condensed consolidated balance sheets.
The Company has two interest rate swap agreements outstanding as of September 30, 2025. The notional amount of the Company’s outstanding swap agreements is $260.1 million. The fair value of the Company’s derivative liabilities is $1.9 million as of September 30, 2025 compared to a derivative asset of $0.8 million as of December 31, 2024. In the condensed consolidated balance sheet, the fair value of the interest rate swaps is included in other long-term liabilities. The gains and losses are not material to the Company’s condensed consolidated financial statements for the periods presented.
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7. Goodwill and Intangible Assets
The following is the summary of changes to the Company's Goodwill for the nine months ended September 30, 2025:

(in thousands) | Vegetation Management |  | Industrial Equipment |  |  |  | Consolidated
Balance at December 31, 2024 |  | $ | 126,729 |  |  |  | $ | 76,298 |  |  |  |  |  |  | $ | 203,027 |
Translation adjustment |  | 2,981 |  |  |  | 1,472 |  |  |  |  |  |  | 4,453 |
Goodwill acquired |  | — |  |  |  | 6,949 |  |  |  |  |  |  | 6,949 |
Balance at September 30, 2025 |  | $ | 129,710 |  |  |  | $ | 84,719 |  |  |  |  |  |  | $ | 214,429 |

The following is a summary of the Company's definite and indefinite-lived intangible assets net of the accumulated amortization:

(in thousands) | Estimated Useful Lives |  | September 30, 2025 |  | December 31, 2024
Definite: |  |  |  |  |  |
Trade names and trademarks | 15-25 years |  | $ | 77,480 |  |  |  | $ | 72,040 |
Customer and dealer relationships | 8-15 years |  | 140,517 |  |  |  | 137,086 |
Patents and drawings | 3-12 years |  | 29,002 |  |  |  | 28,529 |
Favorable leasehold interests | 7 years |  | 4,200 |  |  |  | 4,200 |
Noncompetition agreements | 5 years |  | 200 |  |  |  | 200 |
Total at cost |  |  | 251,399 |  |  |  | 242,055 |
Less accumulated amortization |  |  | (109,577) |  |  |  | (96,195) |
Total net |  |  | 141,822 |  |  |  | 145,860 |
Indefinite: |  |  |  |  |  |
Trade names and trademarks |  |  | 5,500 |  |  |  | 5,500 |
Total Intangible Assets |  |  | $ | 147,322 |  |  |  | $ | 151,360 |

The Company recognized amortization expense of $4.2 million and $4.1 million for the three months ended September 30, 2025 and 2024, respectively, and $12.3 million and $12.2 million for the nine months ended September 30, 2025 and 2024, respectively.
8. Leases
The Company leases office space and equipment under various operating and finance leases, which generally are expected to be renewed or replaced by other leases. The finance leases currently held are considered immaterial. The components of lease cost were as follows:

Components of Lease Cost
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
(in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Finance lease cost: |  |  |  |  |  |  |  |
Amortization of right-of-use assets |  | $ | 2 |  |  | $ | 2 |  |  | $ | 6 |  |  | $ | 6 |
Operating lease cost |  | 1,894 |  |  | 1,859 |  |  | 5,721 |  |  | 5,323 |
Short-term lease cost |  | 497 |  |  | 885 |  |  | 1,473 |  |  | 1,755 |
Variable lease cost |  | 53 |  |  | 57 |  |  | 161 |  |  | 208 |
Total lease cost |  | $ | 2,446 |  |  | $ | 2,803 |  |  | $ | 7,361 |  |  | $ | 7,292 |

11

Maturities of operating lease liabilities were as follows:

Future Minimum Lease Payments
(in thousands) |  | September 30, 2025 |  |  |  |  | December 31, 2024 |  |
2025 |  | $ | 1,896 |  |  |  |  | * |  | $ | 6,998 |  |  |  |
2026 |  | 6,540 |  |  |  |  |  |  | 5,719 |  |  |  |
2027 |  | 4,222 |  |  |  |  |  |  | 3,595 |  |  |  |
2028 |  | 1,989 |  |  |  |  |  |  | 1,556 |  |  |  |
2029 |  | 1,340 |  |  |  |  |  |  | 927 |  |  |  |
Thereafter |  | 1,114 |  |  |  |  |  |  | 914 |  |  |  |
Total minimum lease payments |  | $ | 17,101 |  |  |  |  |  |  | $ | 19,709 |  |  |  |
Less imputed interest |  | (1,158) |  |  |  |  |  |  | (1,432) |  |  |  |
Total operating lease liabilities |  | $ | 15,943 |  |  |  |  |  |  | $ | 18,277 |  |  |  |
*Period ended September 30, 2025 represents the remaining three months of 2025. |  |  |  |  |  |  |  |  |  |  |

Future Lease Commencements
As of September 30, 2025, there are additional operating leases, primarily for buildings, that have not yet commenced in the amount of $5.9 million. These operating leases will commence in fiscal year 2025 and 2026 with lease terms of 1 to 7 years.
Supplemental balance sheet information related to leases was as follows:

Operating Leases |
(in thousands) |  | September 30, 2025 |  |  | December 31, 2024
Other non-current assets |  | $ | 15,649 |  |  |  |  | $ | 18,099 |  |
Accrued liabilities |  | 6,505 |  |  |  |  | 6,449 |  |
Other long-term liabilities |  | 9,438 |  |  |  |  | 11,828 |  |
Total operating lease liabilities |  | $ | 15,943 |  |  |  |  | $ | 18,277 |  |
Weighted Average Remaining Lease Term |  | 3.20 years |  |  |  | 3.49 years |
Weighted Average Discount Rate |  | 4.62 | % |  |  |  | 4.57 | % |

Supplemental cash flow information related to leases was as follows:

|  | Nine Months Ended September 30,
(in thousands) |  | 2025 |  | 2024
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash flows from operating leases |  | $ | 5,196 |  |  | $ | 4,800 |

12

9. Debt
The components of long-term debt are as follows:

(in thousands) |  | September 30, 2025 |  | December 31, 2024
Bank revolving credit facility |  | $ | — |  |  |  | $ | — |  |
Term debt |  | 209,430 |  |  |  | 220,475 |  |
Finance lease obligations |  | — |  |  |  | 6 |  |
Total debt |  | 209,430 |  |  |  | 220,481 |  |
Less current maturities |  | 15,000 |  |  |  | 15,008 |  |
Total long-term debt |  | $ | 194,430 |  |  |  | $ | 205,473 |  |

As of September 30, 2025, $2.8 million of the revolver capacity was committed to irrevocable standby letters of credit issued in the ordinary course of business as required by vendors' contracts, resulting in $397.2 million in available borrowings.
10. Common Stock and Dividends
Dividends declared and paid on a per share basis were as follows:

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Dividends declared | $ | 0.30 |  |  | $ | 0.26 |  |  | $ | 0.90 |  |  | $ | 0.78 |
Dividends paid | $ | 0.30 |  |  | $ | 0.26 |  |  | $ | 0.90 |  |  | $ | 0.78 |

On October 1, 2025, the Company announced that its Board of Directors had declared a quarterly cash dividend of $0.30 per share, which was paid on October 28, 2025, to shareholders of record at the close of business on October 15, 2025.
11. Earnings Per Share
The following table sets forth the reconciliation from basic to diluted average common shares and the calculations of net income per common share. Net income for basic and diluted calculations do not differ.

| Three Months Ended September 30, |  | Nine Months Ended September 30,
(In thousands, except per share) | 2025 |  | 2024 |  | 2025 |  | 2024
Net Income | $ | 25,383 |  |  | $ | 27,405 |  |  | $ | 88,289 |  |  | $ | 87,849 |
Average Common Shares: |  |  |  |  |  |  |
Basic (weighted-average outstanding shares) | 12,029 |  |  | 11,977 |  |  | 12,013 |  |  | 11,965 |
Dilutive potential common shares from stock options | 65 |  |  | 64 |  |  | 62 |  |  | 70 |
Diluted (weighted-average outstanding shares) | 12,094 |  |  | 12,041 |  |  | 12,075 |  |  | 12,035 |
Basic earnings per share | $ | 2.11 |  |  | $ | 2.29 |  |  | $ | 7.35 |  |  | $ | 7.34 |
Diluted earnings per share | $ | 2.10 |  |  | $ | 2.28 |  |  | $ | 7.31 |  |  | $ | 7.30 |

13

12. Revenue and Segment Information
Revenues from Contracts with Customers
Disaggregation of revenue is presented in the tables below by product type and by geographical location. Management has determined that this level of disaggregation would be beneficial to users of the financial statements.

Revenue by Product Type
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(in thousands) | 2025 |  | 2024 |  | 2025 |  | 2024
Net Sales |  |  |  |  |  |  |
Wholegoods | $ | 331,615 |  |  | $ | 307,401 |  |  | $ | 983,850 |  |  | $ | 979,099 |
Parts | 75,677 |  |  | 75,525 |  |  | 200,097 |  |  | 216,605 |
Other | 12,750 |  |  | 18,375 |  |  | 46,118 |  |  | 47,486 |
Consolidated | $ | 420,042 |  |  | $ | 401,301 |  |  | $ | 1,230,065 |  |  | $ | 1,243,190 |

Other includes rental sales, extended warranty sales and service sales as they are considered immaterial.

Revenue by Geographical Location
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(in thousands) | 2025 |  | 2024 |  | 2025 |  | 2024
Net Sales |  |  |  |  |  |  |
United States | $ | 298,482 |  |  | $ | 292,242 |  |  | $ | 881,302 |  |  | $ | 881,231 |
Canada | 41,055 |  |  | 32,448 |  |  | 112,977 |  |  | 102,126 |
France | 20,028 |  |  | 17,894 |  |  | 63,990 |  |  | 67,259 |
United Kingdom | 22,858 |  |  | 21,355 |  |  | 65,559 |  |  | 65,733 |
Brazil | 8,060 |  |  | 8,225 |  |  | 27,952 |  |  | 31,749 |
Netherlands | 5,096 |  |  | 7,798 |  |  | 16,058 |  |  | 28,994 |
Australia | 4,169 |  |  | 5,330 |  |  | 13,120 |  |  | 16,889 |
Germany | 2,275 |  |  | 1,688 |  |  | 5,777 |  |  | 6,864 |
Other | 18,019 |  |  | 14,321 |  |  | 43,330 |  |  | 42,345 |
Consolidated | $ | 420,042 |  |  | $ | 401,301 |  |  | $ | 1,230,065 |  |  | $ | 1,243,190 |

Net sales are attributed to countries based on the location of the customer.
Segment Information
The Company’s Chief Operating Decision Maker (CODM) is the Chief Executive Officer. The CODM is responsible for evaluating the performance of the Company’s operating segments. This evaluation of operating segments supports the allocation of resources, both financial and human, to optimize income from operations as the measure of segment profit and loss.
Our reportable segments are our two Divisions: Vegetation Management and Industrial Equipment.
The CODM focuses heavily on operating performance and reviews mainly non-GAAP measures, such as bookings and backlog, absorption, and headcount. The CODM does not utilize asset metrics to evaluate the segment performance. The GAAP measures used are:
•Division Net Sales
•Division Cost of Sales
•Division Operating Expenses
•Division Income from Operations
14

The following includes a summary of the unaudited financial information by reporting segment at September 30, 2025:

| Three Months Ended September 30, 2025
| Vegetation |  | Industrial |  |
(in thousands) | Management |  | Equipment |  | Consolidated
Net Sales | $ | 173,059 |  |  | $ | 246,983 |  |  | $ | 420,042 |
Less: |  |  |  |  |
Cost of Sales | (134,584) |  |  | (183,775) |  |  | (318,359) |
Operating Expenses | (30,997) |  |  | (33,144) |  |  | (64,141) |
Income from Operations | 7,478 |  |  | 30,064 |  |  | 37,542 |
Interest Income |  |  |  |  | 1,522 |
Other Income (Expense) |  |  |  |  | (210) |
Interest Expense |  |  |  |  | (3,897) |
Income Before Taxes |  |  |  |  | 34,957 |
Taxes |  |  |  |  | 9,574 |
Net Income |  |  |  |  | $ | 25,383 |

| Three Months Ended September 30, 2024
| Vegetation |  | Industrial |  |
(in thousands) | Management |  | Equipment |  | Consolidated
Net Sales | $ | 190,115 |  |  | $ | 211,186 |  |  | $ | 401,301 |
Less: |  |  |  |  |
Cost of Sales | (143,578) |  |  | (156,836) |  |  | (300,414) |
Operating Expenses | (34,133) |  |  | (26,675) |  |  | (60,808) |
Income from Operations | 12,404 |  |  | 27,675 |  |  | 40,079 |
Interest Income |  |  |  |  | 562 |
Other Income (Expense) |  |  |  |  | (32) |
Interest Expense |  |  |  |  | (4,886) |
Income Before Taxes |  |  |  |  | 35,723 |
Taxes |  |  |  |  | 8,318 |
Net Income |  |  |  |  | $ | 27,405 |

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| Nine Months Ended September 30, 2025
| Vegetation |  | Industrial |  |
(in thousands) | Management |  | Equipment |  | Consolidated
Net Sales | $ | 515,307 |  |  | $ | 714,758 |  |  | $ | 1,230,065 |
Less: |  |  |  |  |
Cost of Sales | (390,290) |  |  | (526,959) |  |  | (917,249) |
Operating Expenses | (91,476) |  |  | (92,258) |  |  | (183,734) |
Income from Operations | 33,541 |  |  | 95,541 |  |  | 129,082 |
Interest Income |  |  |  |  | 3,955 |
Other Income (Expense) |  |  |  |  | (4,056) |
Interest Expense |  |  |  |  | (10,775) |
Income Before Taxes |  |  |  |  | 118,206 |
Taxes |  |  |  |  | 29,917 |
Net Income |  |  |  |  | $ | 88,289 |

| Nine Months Ended September 30, 2024
| Vegetation |  | Industrial |  |
(in thousands) | Management |  | Equipment |  | Consolidated
Net Sales | $ | 625,397 |  |  | $ | 617,793 |  |  | $ | 1,243,190 |
Less: |  |  |  |  |
Cost of Sales | (466,044) |  |  | (456,446) |  |  | (922,490) |
Operating Expenses | (109,264) |  |  | (81,069) |  |  | (190,333) |
Income from Operations | 50,089 |  |  | 80,278 |  |  | 130,367 |
Interest Income |  |  |  |  | 1,877 |
Other Income (Expense) |  |  |  |  | 1 |
Interest Expense |  |  |  |  | (17,075) |
Income Before Taxes |  |  |  |  | 115,170 |
Taxes |  |  |  |  | 27,321 |
Net Income |  |  |  |  | $ | 87,849 |

(in thousands) | September 30, 2025 |  | December 31, 2024
Goodwill |  |  |
Vegetation Management | $ | 129,710 |  |  | $ | 126,729 |
Industrial Equipment | 84,719 |  |  | 76,298 |
Consolidated | $ | 214,429 |  |  | $ | 203,027 |
Total Identifiable Assets |  |  |
Vegetation Management | $ | 920,007 |  |  | $ | 852,007 |
Industrial Equipment | 674,972 |  |  | 598,272 |
Consolidated | $ | 1,594,979 |  |  | $ | 1,450,279 |

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13. Accumulated Other Comprehensive Loss
Changes in accumulated other comprehensive loss by component, net of tax, were as follows:

| Three Months Ended September 30,
| 2025 |  | 2024
(in thousands) | Foreign Currency Translation Adjustment | Defined Benefit Plans Items | Gains (Losses) on Cash Flow Hedges | Total |  | Foreign Currency Translation Adjustment | Defined Benefit Plans Items | Gains (Losses) on Cash Flow Hedges | Total
Balance as of beginning of period | $ | (41,949) |  | $ | (989) |  | $ | (1,483) |  | $ | (44,421) |  |  | $ | (64,566) |  | $ | (1,502) |  | $ | (87) |  | $ | (66,155) |
Other comprehensive income (loss) before reclassifications | (7,328) |  | — |  | (286) |  | (7,614) |  |  | 13,825 |  | — |  | (3,198) |  | 10,627 |
Amounts reclassified from accumulated other comprehensive loss | — |  | 200 |  | 265 |  | 465 |  |  | — |  | 235 |  | 383 |  | 618 |
Other comprehensive income (loss) | (7,328) |  | 200 |  | (21) |  | (7,149) |  |  | 13,825 |  | 235 |  | (2,815) |  | 11,245 |
Balance as of end of period | $ | (49,277) |  | $ | (789) |  | $ | (1,504) |  | $ | (51,570) |  |  | $ | (50,741) |  | $ | (1,267) |  | $ | (2,902) |  | $ | (54,910) |

| Nine Months Ended September 30,
| 2025 |  | 2024
(in thousands) | Foreign Currency Translation Adjustment | Defined Benefit Plans Items | Gains (Losses) on Cash Flow Hedges | Total |  | Foreign Currency Translation Adjustment | Defined Benefit Plans Items | Gains (Losses) on Cash Flow Hedges | Total
Balance as of beginning of period | $ | (80,832) |  | $ | (1,390) |  | $ | 627 |  | $ | (81,595) |  |  | $ | (51,785) |  | $ | (1,972) |  | $ | (760) |  | $ | (54,517) |
Other comprehensive income (loss) before reclassifications | 31,555 |  | — |  | (2,929) |  | 28,626 |  |  | 1,044 |  | — |  | (2,712) |  | (1,668) |
Amounts reclassified from accumulated other comprehensive loss | — |  | 601 |  | 798 |  | 1,399 |  |  | — |  | 705 |  | 570 |  | 1,275 |
Other comprehensive income (loss) | 31,555 |  | 601 |  | (2,131) |  | 30,025 |  |  | 1,044 |  | 705 |  | (2,142) |  | (393) |
Balance as of end of period | $ | (49,277) |  | $ | (789) |  | $ | (1,504) |  | $ | (51,570) |  |  | $ | (50,741) |  | $ | (1,267) |  | $ | (2,902) |  | $ | (54,910) |

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following tables set forth, for the periods indicated, certain financial data:

As a Percent of Net Sales | Three Months Ended September 30, |  | Nine Months Ended September 30,
2025 |  | 2024 |  | 2025 |  | 2024
Vegetation Management | 41.2 | % |  | 47.4 | % |  | 41.9 | % |  | 50.3 | %
Industrial Equipment | 58.8 | % |  | 52.6 | % |  | 58.1 | % |  | 49.7 | %
Total sales, net | 100.0 | % |  | 100.0 | % |  | 100.0 | % |  | 100.0 | %

Cost Trends and Profit Margin, as Percentages of Net Sales | Three Months Ended September 30, |  | Nine Months Ended September 30,
2025 |  | 2024 |  | 2025 |  | 2024
Gross profit | 24.2 | % |  | 25.1 | % |  | 25.4 | % |  | 25.8 | %
Income from operations | 8.9 | % |  | 10.0 | % |  | 10.5 | % |  | 10.5 | %
Income before income taxes | 8.3 | % |  | 8.9 | % |  | 9.6 | % |  | 9.3 | %
Net income | 6.0 | % |  | 6.8 | % |  | 7.2 | % |  | 7.1 | %

Overview
This report contains forward-looking statements that are based on Alamo Group’s current expectations. Actual results in future periods may differ materially from those expressed or implied because of a number of risks and uncertainties which are discussed below and in the Forward-Looking Information section. Unless the context otherwise requires, the terms the "Company", "we", "our" and "us" means Alamo Group Inc.
For the nine months of 2025, the Company's net sales declined by 1%, income from operations decreased by 1%, while net income improved by 0.5% compared to the same period in 2024.
The decreases in net sales were primarily driven by weakness in the markets served by our Vegetation Management Division. Additionally, the sale of Herschel Parts on August 16, 2024 had a negative impact to year-on-year sales, albeit immaterial on a total Company basis. These challenges were partially offset by strong sales growth in the Industrial Equipment Division. The Company's backlog at September 30, 2025, totaled $618.3 million, a 15% decrease from $728.8 million at this same period the prior-year, however, new orders increased 6% year over year.
Consolidated income from operations for the first nine months of 2025 was $129.1 million, down 1% from $130.4 million in the same period 2024. The decline in consolidated income from operations was due to weakness in the Vegetation Management Division and the impact from tariffs, partially offset by strong end market demand and operational improvements in the Industrial Equipment Division. We will continue to feel some impacts from tariffs on our consolidated results but we are working to seek available exemptions and to pass these costs on to customers. There is no guarantee we will be able to completely offset tariff effects.
Net Sales in the Industrial Equipment Division increased by 16% (15% organically) for the first nine months of 2025 compared to the same period in 2024. The Division’s backlog declined by 19% as lead-times improved. New orders increased 3% year over year. Income from operations rose 19% versus the prior-year period, reflecting higher demand and continued operational improvements across this Division, partially offset by the impact from tariffs.
Net Sales in the Vegetation Management Division decreased 18% for the first nine months of 2025 compared to the same period in 2024. The Division's backlog declined 3%, while new orders increased 11% year over year. Income from operations decreased 33% versus the prior year period due to several factors including lower sales from the persistent market weakness, operational inefficiencies associated with factory consolidations and the impact from tariffs, partially offset by the reduction in operating expenses.
We are executing a footprint optimization program within our Vegetation Management Division. To date, we have relocated applicable product families, designated one facility as held for sale, repurposed one facility to
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support other brands, and completed initial set-ups for portions of the production lines. Over the next approximately two quarters, we plan to finish the remaining line installations and increase production. During this transition, we expect temporary production inefficiencies, duplicate costs, and shipment-timing effects that may pressure revenue and gross margin, along with potentially one-time expenses related to relocation and facility exit. Following completion, we expect improved capacity utilization, service levels and structural cost reductions. The anticipated timing, costs and benefits are forward-looking and subject to the risks and uncertainties described under “Forward-Looking Information”. As part of the ongoing consolidation within the Vegetation Management Division, the Gibson City, Illinois facility has been designated for disposition and is reported on the balance sheet under Other Non-Current Assets as held-for-sale.
Results of Operations
Three Months Ended September 30, 2025 vs. Three Months Ended September 30, 2024
Net sales for the third quarter of 2025 were $420.0 million, an increase of $18.7 million or 5% compared to $401.3 million for the third quarter of 2024. Net sales during the third quarter of 2025 increased due to strong demand for the Industrial Equipment Division, but were offset by the weaker forestry, tree care, and agricultural markets in the Vegetation Management Division.
Net sales in the Industrial Equipment Division were $247.0 million in the third quarter of 2025 compared to $211.2 million for the same period in 2024, an increase of $35.8 million or 17%. The increase was due to solid demand in all product lines, particularly vacuum trucks and snow removal contributing the most to year-over-year growth.
Net sales in the Vegetation Management Division decreased by $17.0 million or 9% to $173.1 million for the third quarter of 2025 compared to $190.1 million during the same period in 2024. The decrease was due to sustained weakness in forestry, tree care, and agricultural mowing markets. The sale of Herschel Parts on August 16, 2024, contributed slightly to the year-over-year decrease, but was immaterial to the overall results.
Gross profit for the third quarter of 2025 was $101.7 million (24% of net sales) compared to $100.9 million (25% of net sales) during the same period in 2024, an increase of $0.8 million. Strong demand and performance in the Industrial Equipment Division supported the increase in gross profit, but was offset by the weaker demand and operating inefficiencies in the Vegetation Management Division. Additionally, tariff impact in the third quarter was only partially offset by mitigating actions.
Selling, general and administrative expenses (“SG&A”) were $59.9 million (14% of net sales) during the third quarter of 2025 compared to $56.7 million (14% of net sales) during the same period of 2024, an increase of $3.2 million attributable to the CEO transition and acquisition and integration costs. Amortization expense in the third quarter of 2025 was $4.2 million compared to $4.1 million in the same period in 2024.
Interest expense was $3.9 million for the third quarter of 2025 compared to $4.9 million during the same period in 2024 due to debt reduction.
Other income (expense), net was $0.2 million of expense for the third quarter of 2025 compared to less than $0.1 million of expense during the same period in 2024.
Provision for income taxes was $9.6 million (27% of income before income tax) in the third quarter of 2025 compared to $8.3 million (23% of income before income tax) during the same period in 2024. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, which introduced significant changes to U.S. income tax legislation. Key provisions of the OBBBA that affect the company include (i) 100 percent bonus depreciation for qualified property placed in service after January 19, 2025, and (ii) immediate expensing of domestic research and experimental expenditures starting January 1, 2025. In accordance with ASC 740, the Company has recognized the effects of the new tax law in the period of enactment. The impact of the OBBBA for the quarter ended September 30, 2025, resulted in a reduction of current income tax expense, primarily due to the impact of 100% bonus depreciation and immediate expensing of domestic research and experimental expenditures. This reduction was substantially offset by a corresponding increase in deferred income tax expense. The net effect of OBBBA did not
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have a material impact on the Company’s effective tax rate for the period. The Company continues to evaluate the impact of the OBBBA on its consolidated financial statements.
The Company’s net income after tax was $25.4 million or $2.10 per share on a diluted basis for the third quarter of 2025 compared to $27.4 million or $2.28 per share on a diluted basis for the third quarter of 2024. Tariffs were only partially offset by mitigating actions.
Nine Months Ended September 30, 2025 vs. Nine Months Ended September 30, 2024
Net sales for the first nine months of 2025 were $1,230.1 million, a decrease of $13.1 million or 1% compared to $1,243.2 million for the first nine months of 2024. The decrease in net sales during the first nine months of 2025 was driven by a significant reduction in market demand in forestry, tree care, and agricultural mowing in the Vegetation Management Division, partially offset by continued robust demand for Industrial Equipment.
Net sales in the Industrial Equipment Division were $714.8 million during the first nine months of 2025 compared to $617.8 million for the same period in 2024, an increase of $97.0 million or 16%. The increase in sales for the first nine months of 2025 compared to the first nine months of 2024 was mainly due to the continued strong demand across the division in excavators, vacuum trucks, and snow removal.
Net sales in the Vegetation Management Division decreased during the first nine months by $110.1 million or 18% to $515.3 million for 2025 compared to $625.4 million during the same period in 2024. The decrease was due to weaker demand for forestry, tree care, and agricultural mowing markets. The sale of Herschel Parts on August 16, 2024, was immaterial to the year over year sales decrease.
Gross profit for the first nine months of 2025 was $312.8 million (25% of net sales) compared to $320.7 million (26% of net sales) during the same period in 2024, a decrease of $7.9 million. The decrease in gross profit was mainly attributable to lower sales volume and production inefficiencies in Vegetation Management Division. Tariffs were only partially offset by mitigating actions.
SG&A expenses were $171.4 million (14% of net sales) during the first nine months of 2025 compared to $178.2 million (14% of net sales) during the same period of 2024, a decrease of $6.8 million attributable to labor cost savings actions taken in Vegetation Management offsetting additional costs of $3.9 million due to CEO transition and acquisition and integration costs. Amortization expense in the first nine months of 2025 was $12.3 million compared to $12.2 million in the same period in 2024. a decrease of $0.0 million.
Interest expense was $10.8 million for the first nine months of 2025 compared to $17.1 million during the same period in 2024, a decrease of $6.3 million mainly due to debt reduction.
Other income (expense), net was $4.1 million of expense during the first nine months of 2025 compared to less than $0.1 million of income in the first nine months of 2024. The increase was a result of unfavorable currency exchange rates.
Provision for income taxes was $29.9 million (25% of income before income taxes) in the first nine months of 2025 compared to $27.3 million (24% of income before income taxes) during the same period in 2024.
The Company's net income after tax was $88.3 million or $7.31 per share on a diluted basis for the first nine months of 2025 compared to $87.8 million or $7.30 per share on a diluted basis for the first nine months of 2024. The increase of $0.5 million resulted from the factors described above.
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Liquidity and Capital Resources
In addition to normal operating expenses, the Company has ongoing cash requirements which are necessary to operate the business, including inventory purchases and capital expenditures. The Company’s accounts receivable, inventory and accounts payable levels, particularly in its Vegetation Management Division, historically build in the first quarter and early spring and, to a lesser extent, in the fourth quarter in anticipation of the spring and fall selling seasons. Accounts receivable historically build in the first and fourth quarters of each year as a result of pre-season sales and year-round sales programs. These sales, primarily in the Vegetation Management Division, help balance the Company’s production during the first and fourth quarters.
As of September 30, 2025, the Company had working capital of $758.3 million which represents an increase of $91.1 million from working capital of $667.2 million at December 31, 2024. The increase in working capital was due to higher cash and cash equivalents as well as an increase in accounts receivable and inventory, partially offset by increase in accounts payable.
Capital expenditures were $25.4 million for the first nine months of 2025, compared to $19.0 million during the first nine months of 2024. The Company expects a capital expenditure level of approximately $30.0 million to $35.0 million for the full year of 2025. The Company will fund any future expenditures from operating cash flows or through our revolving credit facility, described below.
Net cash used for investing activities was $41.9 million during the first nine months of 2025 compared to $16.1 million during the first nine months of 2024.
Net cash used in financing activities was $23.6 million and $25.4 million during the nine month periods ended September 30, 2025 and September 30, 2024, respectively. Lower net cash used by financing activities for the first nine months of 2025 relates to no contingent consideration payment from an acquisition net of a higher dividend during the nine months ended September 30, 2025.
The Company had $159.4 million in cash and cash equivalents held by its foreign subsidiaries as of September 30, 2025. The majority of these funds are at our European and Canadian facilities. The Company will repatriate European and Canadian cash and cash equivalents as needed to fund operating and investing activities, and will monitor exchange rates to determine the appropriate timing of such repatriation given the current relative value of the U.S. dollar. Repatriated funds will be used to reduce debt levels, and to fund working capital, capital investments, and acquisitions company-wide.
On October 28, 2022, the Company, as Borrower, and each of its domestic subsidiaries as guarantors, entered into a Third Amended and Restated Credit Agreement (the “2022 Credit Agreement”) with Bank of America, N.A., as Administrative Agent. The 2022 Credit Agreement provides Borrower with the ability to request loans and other financial obligations in an aggregate amount of up to $655.0 million. Under the 2022 Credit Agreement, the Company has borrowed $255.0 million pursuant to a Term Facility, while up to $400.0 million is available to the Company pursuant to a Revolver Facility which terminates in 2027. The Term Facility requires the Company to make equal quarterly principal payments of $3.75 million over the term of the loan, with the final payment of any outstanding principal amount, plus interest, due at the end of the five year term. Borrowings under the 2022 Credit Agreement bear interest, at the Company’s option, at a Term Secured Overnight Financing Rate (“SOFR”) or a Base Rate (each as defined in the 2022 Credit Agreement), plus, in each case, an applicable margin. The applicable margin ranges from 1.25% to 2.50% for Term SOFR borrowings and from .25% to 1.50% for Base Rate borrowings with the margin percentage based upon the Company's consolidated leverage ratio. The Company must also pay a commitment fee to the lenders ranging between 0.15% to 0.30% on any unused portion of the $400.0 million Revolver Facility. The 2022 Credit Agreement requires the Company to maintain two financial covenants, namely, a maximum consolidated leverage ratio and a minimum consolidated fixed charge coverage ratio. The Agreement also contains various covenants relating to limitations on indebtedness, limitations on investments and acquisitions, limitations on the sale of properties and limitations on liens and capital expenditures. The Agreement also contains other customary covenants, representations and events of defaults. The expiration date of the 2022 Credit Agreement, including the Term Facility and the Revolver Facility, is October 28, 2027. As of September 30, 2025, $210.0 million was outstanding under the 2022 Credit Agreement, $210.0 million on the Term Facility and zero on the Revolver Facility. On September 30, 2025, $2.8 million of the revolver capacity was committed to irrevocable standby letters of credit issued in the ordinary course of business as required by vendors' contracts resulting in $397.2 million in available borrowings. The Company is in compliance with the covenants under the Agreement as of September 30, 2025.
Management believes the 2022 Credit Agreement along with the Company’s ability to internally generate funds from operations should be sufficient to allow the Company to meet its cash requirements for the foreseeable future.
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However, future challenges affecting the banking industry and credit markets in general could potentially cause changes to credit availability, which creates a level of uncertainty.
As of September 30, 2025, we believe our financial position remains robust, supported by a strong balance sheet and healthy cash flow from operations. Our available liquidity, comprised of cash and cash equivalents, along with access to undrawn credit facilities, ensures that we are well equipped to meet our operating needs and explore strategic initiatives that could enhance shareholder value. We continuously evaluate our capital allocation strategy, including potentially repurchasing shares under the share repurchase program adopted by the Company and approved by the Board of Directors as announced on October 31, 2024 if it aligns with our strategic priorities and is deemed to be in the best interest of our shareholders. We believe that repurchasing our shares would be a prudent use of capital, provided appropriate market conditions exist.
Critical Accounting Estimates
Management’s Discussion and Analysis of Financial Condition and Results of Operations are based upon our Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Critical Accounting Policies
An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements. Management believes that of the Company's significant accounting policies, which are set forth in Note 1 of the Notes to Consolidated Financial Statements in the 2024 Form 10-K, the policies relating to the business combinations involve a higher degree of judgment and complexity. There have been no material changes to the nature of estimates, assumptions and levels of subjectivity and judgment related to critical accounting estimates disclosed in Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" of the 2024 Form 10-K.
Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements that have or are likely to have a current or future material effect on our financial condition.
Forward-Looking Information
Part I of this Quarterly Report on Form 10-Q and the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 2 of this Quarterly Report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. In addition, forward-looking statements may be made orally or in press releases, conferences, reports or otherwise, in the future by or on behalf of the Company. Generally, forward-looking statements are not based on historical facts but instead represent the Company's and its management's belief regarding future events.
Statements that are not historical are forward-looking. When used by us or on our behalf, the words "expect,"
“will,” “estimate,” “believe,” “intend,” "would," “could,” "predict," “should,” “anticipate,” "continue," “project,” “forecast,”
“plan,” “may” and similar expressions generally identify forward-looking statements made by us or on our behalf.
Forward-looking statements involve risks and uncertainties. These uncertainties include factors that affect all
businesses operating in a global market, as well as matters specific to the Company and the markets we serve.
Certain particular risks and uncertainties that continually face us include the following:
•budget constraints and revenue shortfalls which could affect the purchases of our type of equipment by governmental customers and related contractors in both domestic and international markets;
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•market acceptance of new and existing products;
•our ability to hire suitable employees for our business and maintain good relations with employees;
•our ability to develop and manufacture new and existing products profitably;
•the inability of our suppliers, creditors, public utility providers and financial and other service organizations to deliver or provide their products or services to us;
•legal actions and litigation;
•impairment in the carrying value of goodwill;
•our ability to successfully integrate acquisitions and operate acquired businesses or assets;
•our ability to achieve anticipated cost savings and synergies associated with restructuring some of our business operations;
•current and changing tax laws in the U.S. and internationally;
•our ability to hire and retain quality skilled employees; and
•changes in the prices of agricultural commodities, which could affect our customers’ income levels.
In addition, we are subject to risks and uncertainties facing the industry in general, including the following:
•changes in business and political conditions and the economy in general in both domestic and international markets;
•uncertainty due to future direction of federal fiscal policy following national elections may slow the growth in governmental market revenue;
•the price and availability of energy and critical raw materials, particularly steel and steel products;
•increased competition;
•increases in input costs on items we use in the manufacturing of our products;
•adverse weather conditions such as droughts, floods, snowstorms, etc., which can affect the buying patterns of our customers and end-users;
•increased costs of complying with governmental regulations which affect corporations including related fines and penalties (such as the European General Data Protection Regulation (GDPR) and the California Consumer Privacy Act);
•an increase in unfunded pension plan liability due to financial market deterioration;
•the potential effects on the buying habits of our customers due to animal disease outbreaks and other epidemics;
•adverse market conditions and credit constraints which could affect our customers and end-users, such as cutbacks on dealer stocking levels;
•changes in market demand;
•climate related incidents and other sustainability risks, global pandemics, acts of war or aggression and terrorist activities or military actions;
•cyber security risks including the potential loss of proprietary data or data security breaches and related fines, penalties and other liabilities;
•financial market changes including changes in interest rates and fluctuations in foreign exchange rates;
•abnormal seasonal factors in our industry;
•changes in domestic and foreign governmental policies and laws, including increased levels of government regulation and changes in agricultural policies, including the amount of farm subsidies and farm payments as well as changes in trade policy that may have an adverse impact on our business;
•changes to global trade policies, tariffs, trade sanctions, and investment restrictions;
•government actions, including but not limited to budget levels, and changes in laws, regulations and legislation, relating to tax, environment, commerce, infrastructure spending, health and safety; and
•risk of governmental defaults and resulting impact on the global economy and particularly financial institutions.
The Company wishes to caution readers not to place undue reliance on any forward-looking statements and to recognize that the statements are not predictions of actual future results. Actual results could differ materially from those anticipated in the forward-looking statements and from historical results, due to the risks and uncertainties
described above, as well as others not now anticipated. The foregoing statements are not exclusive and further information concerning us and our businesses, including factors that could potentially materially affect our financial results, may emerge from time to time. It is not possible for management to predict all risk factors or to assess the impact of such risk factors on the Company’s businesses. Any forward-looking statements made by or on behalf of the Company speak only to the date they are made and we do not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the forward-looking statements were made.
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Item 3. Quantitative and Qualitative Disclosures About Market Risks
The Company is exposed to various market risks. Market risks are the potential losses arising from adverse changes in market prices and rates. The Company does not enter into derivative or other financial instruments for trading or speculative purposes.
Foreign Currency Risk
International Sales
A portion of the Company’s operations consists of manufacturing and sales activities in international jurisdictions. The Company primarily manufactures its products in the U.S., U.K., France, Canada, Brazil, and the Netherlands. The Company sells its products primarily in the functional currency within the markets where the products are produced, but certain sales from the Company's U.K. and Canadian operations are denominated in other foreign currencies. As a result, the Company’s financials, specifically the value of its foreign assets, could be affected by factors such as changes in foreign currency exchange rates or weak economic conditions in the other markets in which the subsidiaries of the Company distribute their products.
Exposure to Exchange Rates
The Company translates the assets and liabilities of foreign-owned subsidiaries at rates in effect at the balance sheet date. Revenues and expenses are translated at average rates in effect during the reporting period. Translation adjustments are included in accumulated other comprehensive income within the statement of stockholders’ equity. The total foreign currency translation adjustment for the current quarter decreased stockholders’ equity by $7.3 million.
The Company’s earnings are affected by fluctuations in the value of the U.S. dollar as compared to foreign currencies, predominately in Europe and Canada, as a result of the sales of its products in international markets. Forward currency contracts are used to hedge against the earnings effects of such fluctuations. The result of a uniform 10% strengthening or 10% decrease in the value of the dollar relative to the currencies in which the Company’s sales are denominated would result in a change in gross profit of $9.5 million for the nine month period ended September 30, 2025. A stronger U.S. dollar would unfavorably impact gross profit while a weaker U.S. dollar would provide a favorable impact to gross profit. This calculation assumes that each exchange rate would change in the same direction relative to the U.S. dollar. In addition to the direct effects of changes in exchange rates, which include a changed dollar value of the resulting sales, changes in exchange rates may also affect the volume of sales or the foreign currency sales price as competitors’ products become more or less attractive. The Company’s sensitivity analysis of the effects of changes in foreign currency exchange rates does not factor in a potential change in sales levels or local currency prices.
Interest Rate Risk
The Company’s long-term debt bears interest at variable rates. Accordingly, the Company’s net income is affected by changes in interest rates. Assuming the current level of borrowings at variable rates and a two percentage point change for the third quarter 2025 average interest rate under these borrowings, the Company’s interest expense would have changed by approximately $1.1 million. To protect the Company's long-term debt from fluctuations in interest rates, the Company may enter into interest rate swaps to mitigate exposure. However, this analysis assumes no such actions. Further this analysis does not consider the effects of the change in the level of overall economic activity that could exist in such an environment.
Item 4. Controls and Procedures
Disclosure Controls and Procedures
An evaluation was carried out under the supervision and with the participation of Alamo’s management, including our President and Chief Executive Officer and Executive Vice President and Chief Financial Officer (Principal Financial Officer) of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). Based upon the evaluation,
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the President and Chief Executive Officer and Executive Vice President and Chief Financial Officer (Principal Financial Officer) concluded that the Company’s design and operation of these disclosure controls and procedures were effective at the end of the period covered by this report.
Changes in internal control over financial reporting
There has been no change in our internal control over financial reporting that occurred during our last fiscal year that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
For a description of legal proceedings, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2024 (the "2024 10-K").
Item 1A. Risk Factors
There have not been any material changes from the risk factors previously disclosed in the 2024 Form 10-K for the year ended December 31, 2024.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
During the quarter ended September 30, 2025, there were no repurchases of our common stock under our share repurchase program.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not Applicable
Item 5. Other Information
(a) Reports on Form 8-K
None.
(b) Other Information
None.
(c) During the period covered by this report, none of the Company’s directors or executive officers has adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5–1 trading arrangement (each as defined in Item 408 of Regulation S-K under the Securities Exchange Act of 1934, as amended).
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Item 6. Exhibits
(a) Exhibits

Exhibits | Exhibit Title |  | Incorporated by Reference From the Following Documents
10.1 | — | Offer Letter |  | Filed as Exhibit 10.1 to Form 8-K, August 18, 2025
10.2 | — | Change in Control and Severance Agreement |  | Filed as Exhibit 10.2 to Form 8-K, August 18, 2025
31.1 | — | Certification by Robert P. Hureau under Section 302 of the Sarbanes-Oxley Act of 2002 |  | Filed Herewith
31.2 | — | Certification by Agnieszka K. Kamps under Section 302 of the Sarbanes-Oxley Act of 2002 |  | Filed Herewith
32.1 | — | Certification by Robert P. Hureau under Section 906 of the Sarbanes-Oxley Act of 2002 |  | Filed Herewith
32.2 | — | Certification by Agnieszka K. Kamps under Section 906 of the Sarbanes-Oxley Act of 2002 |  | Filed Herewith
101.INS | — | XBRL Instance Document - the instance document does not appear in the Interactive Data Files because its XBRL tags are embedded within the Inline XBRL document |  | Filed Herewith
101.SCH | — | XBRL Taxonomy Extension Schema Document |  | Filed Herewith
101.CAL | — | XBRL Taxonomy Extension Calculation Linkbase Document |  | Filed Herewith
101.DEF | — | XBRL Taxonomy Extension Definition Linkbase Document |  | Filed Herewith
101.LAB | — | XBRL Taxonomy Extension Label Linkbase Document |  | Filed Herewith
101.PRE | — | XBRL Taxonomy Extension Presentation Linkbase Document |  | Filed Herewith
104 | — | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |  | Filed Herewith

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Alamo Group Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

November 6, 2025 | Alamo Group Inc.
| (Registrant)
| /s/ Robert P. Hureau
| Robert P. Hureau
| President & Chief Executive Officer
| (Principal Executive Officer)

| /s/ Agnieszka K. Kamps
| Agnieszka K. Kamps
| Executive Vice President & Chief Financial Officer
| (Principal Financial Officer)

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