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Exhibit 99.1
TAT TECHNOLOGIES LTD.
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the Period Ended September 30, 2025
TABLE OF CONTENTS

| Page
Financial statements |
Unaudited Condensed Consolidated Balance Sheets | F - 2
Unaudited Condensed Consolidated Statements of Income | F - 3
Unaudited Condensed Consolidated Statements of Comprehensive Income | F - 4
Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity | F - 5
Unaudited Condensed Consolidated Statements of Cash Flows | F - 7
Unaudited Condensed Notes to Financial Statements | F - 8

TAT TECHNOLOGIES LTD. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

U.S dollars in thousands

|  | September 30, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
ASSETS |  |  |  |  |  |
CURRENT ASSETS: |  |  |  |  |  |
Cash and cash equivalents |  | $ | 47,094 |  |  | $ | 7,129 |
Accounts receivable, net of allowance for credit losses of $321 and $400 as of September 30, 2025, and December 31, 2024, respectively |  |  | 33,330 |  |  |  | 29,697 |
Inventory |  |  | 78,171 |  |  |  | 68,540 |
Prepaid expenses and other current assets |  |  | 6,301 |  |  |  | 7,848 |
Total current assets |  |  | 164,896 |  |  |  | 113,214 |
NON-CURRENT ASSETS: |  |  |  |  |  |  |  |
Property, plant and equipment, net |  |  | 46,172 |  |  |  | 41,576 |
Operating lease right of use assets |  |  | 5,363 |  |  |  | 2,282 |
Intangible assets, net |  |  | 1,528 |  |  |  | 1,553 |
Investment in affiliates |  |  | 4,460 |  |  |  | 2,901 |
Funds in respect of employee rights upon retirement |  |  | 736 |  |  |  | 654 |
Deferred tax assets |  |  | 683 |  |  |  | 877 |
Restricted deposit |  |  | 297 |  |  |  | 305 |
Total non-current assets |  |  | 59,239 |  |  |  | 50,148 |
Total assets |  | $ | 224,135 |  |  | $ | 163,362 |
LIABILI TIES AND SHAREHOLDERS’ EQUITY |  |  |  |  |  |  |  |
CURRENT LIABILITIES: |  |  |  |  |  |  |  |
Current maturities of long-term loans |  | $ | 2,151 |  |  | $ | 2,083 |
Short-term loans |  |  | - |  |  |  | 4,350 |
Accounts payable |  |  | 16,898 |  |  |  | 12,158 |
Accrued expenses and other |  |  | 16,709 |  |  |  | 18,594 |
Current maturities of operating lease liabilities |  |  | 1,358 |  |  |  | 939 |
Total current liabilities |  |  | 37,116 |  |  |  | 38,124 |
NON-CURRENT LIABILITIES: |  |  |  |  |  |  |  |
Long-term loans |  |  | 9,884 |  |  |  | 10,938 |
Liability in respect of employee rights upon retirement |  |  | 1,109 |  |  |  | 986 |
Deferred tax liabilities |  |  | 1,272 |  |  |  | - |
Operating lease liabilities |  |  | 4,066 |  |  |  | 1,345 |
Total non-current liabilities |  |  | 16,331 |  |  |  | 13,269 |
COMMITMENTS AND CONTINGENCIES (NOTE 4) |  |  | - |  |  |  | - |
Total liabilities |  |  | 53,447 |  |  |  | 51,393 |

SHAREHOLDERS’ EQUITY: |  |  |  |  |  |
Ordinary shares of NIS 0 par value at September 30, 2025 and at December 31, 2024, respectively Authorized: 15,000,000 shares at September 30, 2025 and 13,000,000 at December 31, 2024; Issued: 13,225,110 and 11,214,831 shares at September 30, 2025 and at December 31, 2024, respectively; Outstanding: 12,950,637 and 10,940,358 shares at September 30, 2025 and at December 31, 2024, respectively |  |  | - |  |  |  | - |
Additional paid-in capital |  |  | 135,745 |  |  |  | 89,697 |
Treasury stock at cost |  |  | (2,088 | ) |  |  | (2,088 | )
Accumulated other comprehensive income (loss) |  |  | 499 |  |  |  | (76 | )
Retained earnings |  |  | 36,532 |  |  |  | 24,436 |
Total shareholders' equity |  |  | 170,688 |  |  |  | 111,969 |
Total liabilities and shareholders' equity |  | $ | 224,135 |  |  | $ | 163,362 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F - 2

TAT TECHNOLOGIES LTD. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

U.S dollars in thousands

|  | Three Months Ended |  |  | Nine Months Ended |
|  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
Products |  | $ | 12,617 |  |  | $ | 12,164 |  |  | $ | 37,804 |  |  | $ | 35,831 |
Services |  |  | 33,618 |  |  |  | 28,295 |  |  |  | 93,677 |  |  |  | 75,241 |
|  |  | 46,235 |  |  |  | 40,459 |  |  |  | 131,481 |  |  |  | 111,072 |
Cost of goods: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Products |  |  | 9,170 |  |  |  | 8,535 |  |  |  | 26,613 |  |  |  | 25,194 |
Services |  |  | 25,464 |  |  |  | 23,443 |  |  |  | 72,488 |  |  |  | 62,347 |
|  |  | 34,634 |  |  |  | 31,978 |  |  |  | 99,101 |  |  |  | 87,541 |
Gross profit |  |  | 11,601 |  |  |  | 8,481 |  |  |  | 32,380 |  |  |  | 23,531 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Research and development, net |  |  | 323 |  |  |  | 326 |  |  |  | 887 |  |  |  | 946 |
Selling and marketing |  |  | 1,993 |  |  |  | 1,994 |  |  |  | 6,106 |  |  |  | 5,647 |
General and administrative |  |  | 4,025 |  |  |  | 2,715 |  |  |  | 11,522 |  |  |  | 8,940 |
Other income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (390 | )
|  |  | 6,341 |  |  |  | 5,035 |  |  |  | 18,515 |  |  |  | 15,143 |
Operating income |  |  | 5,260 |  |  |  | 3,446 |  |  |  | 13,865 |  |  |  | 8,388 |
Interest expenses |  |  | (176 | ) |  |  | (420 | ) |  |  | (835 | ) |  |  | (1,183 | )
Other financial income (expenses), net |  |  | 206 |  |  |  | (315 | ) |  |  | (293 | ) |  |  | (308 | )
Income before taxes on income (taxes benefit) |  |  | 5,290 |  |  |  | 2,711 |  |  |  | 12,737 |  |  |  | 6,897 |
Provision for taxes on income (taxes benefit) |  |  | 821 |  |  |  | 15 |  |  |  | 1,624 |  |  |  | (94 | )
Profit before share of equity investment |  |  | 4,469 |  |  |  | 2,696 |  |  |  | 11,113 |  |  |  | 6,991 |
Share in profits of equity investment of affiliated companies |  |  | 372 |  |  |  | 169 |  |  |  | 983 |  |  |  | 601 |
Net income |  | $ | 4,841 |  |  | $ | 2,865 |  |  | $ | 12,096 |  |  | $ | 7,592 |

Earnings per share |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 0.37 |  |  | $ | 0.27 |  |  | $ | 1.03 |  |  | $ | 0.73 |
Diluted |  | $ | 0.37 |  |  | $ | 0.26 |  |  | $ | 1.02 |  |  | $ | 0.69 |
Weighted average number of shares outstanding |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  |  | 12,911,050 |  |  |  | 10,609,867 |  |  |  | 11,776,747 |  |  |  | 10,462,012 |
Diluted |  |  | 13,078,467 |  |  |  | 10,829,749 |  |  |  | 11,904,044 |  |  |  | 11,055,263 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F - 3

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

U.S dollars in thousands

|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Net income |  | $ | 4,841 |  |  | $ | 2,865 |  |  | $ | 12,096 |  |  | $ | 7,592 |
Other comprehensive income (loss), net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net unrealized losses from derivatives |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (27 | )
Change in foreign currency translation adjustments |  |  | (101 | ) |  |  | (43 | ) |  |  | 575 |  |  |  | 121 |
Total comprehensive income |  | $ | 4,740 |  |  | $ | 2,822 |  |  | $ | 12,671 |  |  | $ | 7,686 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F - 4

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY

U.S dollars in thousands, except share data

|  | Share capital |  |  |  |  |  | Accumulated other comprehensive income (loss) |  |  |  |  |  |  |  |  |  |
|  | Number of shares issued |  |  | Amount |  |  | Additional paid-in capital |  |  |  |  | Treasury shares |  |  | Retained earnings |  |  | Total equity |
BALANCE AT DECEMBER 31, 2023 |  |  | 10,377,085 |  |  | $ | 3,140 |  |  | $ | 76,335 |  |  | $ | 27 |  |  | $ | (2,088 | ) |  | $ | 13,269 |  |  | $ | 90,683 |
CHANGES DURING THE NINE MONTHS ENDED SEPTEMBER 30, 2024: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Comprehensive income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 94 |  |  |  | - |  |  |  | 7,592 |  |  |  | 7,686 |
Exercise of option |  |  | 84,006 |  |  |  | 12 |  |  |  | (12 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Cancellation of par value |  |  | - |  |  |  | (3,152 | ) |  |  | 3,152 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Issuance of common shares on public offering, net of issuance costs of $152 |  |  | 673,340 |  |  |  | - |  |  |  | 9,923 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 9,923 |
Share based compensation |  |  | - |  |  |  | - |  |  |  | 210 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 210 |
BALANCE AT SEPTEMBER 30, 2024 |  |  | 11,134,431 |  |  | $ | - |  |  | $ | 89,608 |  |  | $ | 121 |  |  | $ | (2,088 | ) |  | $ | 20,861 |  |  | $ | 108,502 |
BALANCE AT DECEMBER 31, 2024 |  |  | 11,214,831 |  |  | $ | - |  |  | $ | 89,697 |  |  | $ | (76 | ) |  | $ | (2,088 | ) |  | $ | 24,436 |  |  | $ | 111,969 |
CHANGES DURING THE NINE MONTHS ENDED SEPTEMBER 30, 2025: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Comprehensive income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 575 |  |  |  | - |  |  |  | 12,096 |  |  |  | 12,671 |
Exercise of option |  |  | 142,981 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Issuance of common shares on public offering, net of issuance costs of $2,769 |  |  | 1,625,000 |  |  |  | - |  |  |  | 39,415 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 39,415 |
Exercise of the underwriters' option on public offering, net of issuance costs of $413 |  |  | 242,298 |  |  |  | - |  |  |  | 5,953 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 5,953 |
Share based compensation |  |  | - |  |  |  | - |  |  |  | 680 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 680 |
BALANCE AT SEPTEMBER 30, 2025 |  |  | 13,225,110 |  |  | $ | - |  |  | $ | 135,745 |  |  | $ | 499 |  |  | $ | (2,088 | ) |  | $ | 36,532 |  |  | $ | 170,688 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F - 5

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY

U.S dollars in thousands, except share data

|  | Share capital |  |  |  |  |  | Accumulated other comprehensive income |  |  |  |  |  |  |  |  |  |
|  | Number of shares issued |  |  | Amount |  |  | Additional paid-in capital |  |  |  |  | Treasury shares |  |  | Retained earnings |  |  | Total equity |
BALANCE AT JUNE 30, 2024 |  |  | 10,426,194 |  |  | $ | 3,152 |  |  | $ | 76,512 |  |  | $ | 164 |  |  | $ | (2,088 | ) |  | $ | 17,996 |  |  | $ | 95,736 |
CHANGES DURING THE THREE MONTHS ENDED SEPTEMBER 30, 2024: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Comprehensive income (loss) |  |  | 34,897 |  |  |  | - |  |  |  | - |  |  |  | (43 | ) |  |  |  |  |  |  | 2,865 |  |  |  | 2,822 |
Exercise of option |  |  |  |  |  |  | (3,152 | ) |  |  | 3,152 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Issuance of common shares net of issuance costs of $152 |  |  | 673,340 |  |  |  | - |  |  |  | 9,923 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 9,923 |
Share based compensation |  |  | - |  |  |  | - |  |  |  | 21 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 21 |
BALANCE AT SEPTEMBER 30, 2024 |  |  | 11,134,431 |  |  | $ | - |  |  | $ | 89,608 |  |  | $ | 121 |  |  | $ | (2,088 | ) |  | $ | 20,861 |  |  | $ | 108,502 |
BALANCE AT JUNE 30, 2025 |  |  | 13,161,762 |  |  | $ | - |  |  | $ | 135,578 |  |  | $ | 600 |  |  | $ | (2,088 | ) |  | $ | 31,691 |  |  | $ | 165,781 |
CHANGES DURING THE THREE MONTHS ENDED SEPTEMBER 30, 2025: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Comprehensive income (loss) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (101 | ) |  |  | - |  |  |  | 4,841 |  |  |  | 4,740 |
Exercise of stock option |  |  | 63,348 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Share based compensation |  |  | - |  |  |  | - |  |  |  | 167 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 167 |
BALANCE AT SEPTEMBER 30, 2025 |  |  | 13,225,110 |  |  | $ | - |  |  | $ | 135,745 |  |  | $ | 499 |  |  | $ | (2,088 | ) |  | $ | 36,532 |  |  | $ | 170,688 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F - 6

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

U.S. dollars in thousands

|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
CASH FLOWS FROM OPERATING ACTIVITIES: |  |  |  |  |  |  |  |  |  |  |  |
Net income |  | $ | 4,841 |  |  | $ | 2,865 |  |  | $ | 12,096 |  |  | $ | 7,592 |
Adjustments to reconcile net income to net cash used in operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | 1,249 |  |  |  | 1,514 |  |  |  | 3,762 |  |  |  | 4,319 |
Non-cash financial (income) expenses |  |  | 126 |  |  |  | 220 |  |  |  | 634 |  |  |  | (266 | )
Change in allowance for credit losses |  |  | (104 | ) |  |  | (40 | ) |  |  | (79 | ) |  |  | - |
Share in profits of equity investment of affiliated companies |  |  | (372 | ) |  |  | (169 | ) |  |  | (983 | ) |  |  | (601 | )
Share based compensation |  |  | 167 |  |  |  | 21 |  |  |  | 680 |  |  |  | 210 |
Gain on disposal of property, plant and equipment |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (355 | )
Deferred income taxes, net |  |  | 884 |  |  |  | 12 |  |  |  | 1,466 |  |  |  | (91 | )
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Increase in trade accounts receivable |  |  | (960 | ) |  |  | (3,456 | ) |  |  | (3,554 | ) |  |  | (9,706 | )
Decrease (increase) in prepaid expenses and other current assets |  |  | 281 |  |  |  | (555 | ) |  |  | 1,464 |  |  |  | (838 | )
Increase in inventory |  |  | (1,757 | ) |  |  | (5,112 | ) |  |  | (9,052 | ) |  |  | (10,655 | )
Increase in trade accounts payable |  |  | 1,334 |  |  |  | 3,825 |  |  |  | 4,740 |  |  |  | 2,916 |
Increase (decrease) in accrued expenses and other |  |  | 1,806 |  |  |  | 3,665 |  |  |  | (1,765 | ) |  |  | 2,618 |
Net cash provided by (used in) operating activities |  |  | 7,495 |  |  |  | 2,790 |  |  |  | 9,409 |  |  |  | (4,857 | )
CASH FLOWS FROM INVESTING ACTIVITIES: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchase of property and equipment |  |  | (2,743 | ) |  |  | (1,621 | ) |  |  | (8,910 | ) |  |  | (3,588 | )
Proceeds from sale of property and equipment |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,306 |
Net cash used in investing activities |  |  | (2,743 | ) |  |  | (1,621 | ) |  |  | (8,910 | ) |  |  | (2,282 | )
CASH FLOWS FROM FINANCING ACTIVITIES: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Repayments of long-term loans |  |  | (473 | ) |  |  | (504 | ) |  |  | (1,560 | ) |  |  | (1,454 | )
Proceeds from issuance of ordinary shares and exercise of underwriters’ option |  |  | - |  |  |  | 9,923 |  |  |  | 48,550 |  |  |  | 9,923 |
Issuance costs of ordinary shares and exercise of the underwriters' option |  |  | (362 | ) |  |  | - |  |  |  | (3,182 | ) |  |  | - |
Net change in short term loans from banks |  |  | - |  |  |  | (10,072 | ) |  |  | (4,350 | ) |  |  | (9,404 | )
Net cash provided by (used in) financing activities |  |  | (835 | ) |  |  | (653 | ) |  |  | 39,458 |  |  |  | (935 | )
Net increase (decrease) in cash and cash equivalents and restricted cash |  |  | 3,917 |  |  |  | 516 |  |  |  | 39,957 |  |  |  | (8,074 | )
Cash and cash equivalents and restricted cash at beginning of period |  |  | 43,474 |  |  |  | 8,352 |  |  |  | 7,434 |  |  |  | 16,942 |
Cash and cash equivalents and restricted cash at the end of period |  | $ | 47,391 |  |  | $ | 8,868 |  |  | $ | 47,391 |  |  | $ | 8,868 |
Supplementary information on investing and financing activities not involving cash flows: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Additions of operating lease right-of-use assets and operating lease liabilities |  |  | 1,948 |  |  | $ | 228 |  |  |  | 3,783 |  |  | $ | 818 |
Reclassification between inventory and property, plant and Equipment |  |  | - |  |  |  | - |  |  |  | 579 |  |  |  | 60 |
Supplemental disclosure of cash flow information: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest paid |  |  | 430 |  |  |  | 437 |  |  |  | 946 |  |  |  | 1,289 |
Income taxes paid |  |  | 21 |  |  |  | - |  |  |  | 197 |  |  |  | - |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F - 7

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands
NOTE 1 - GENERAL
TAT Technologies Ltd., (“TAT” or the “Company”) an Israeli corporation, incorporated in 1985, is a leading provider of services and products to the commercial and military aerospace and ground defense industries.
TAT has the following wholly owned subsidiaries, hereinafter collectively referred to as the “Group”: Limco-Piedmont Inc. (“Limco-Piedmont”), Limco Airepair Inc. (“Limco”), a wholly owned Delaware subsidiary of Limco-Piedmont, Piedmont Aviation Component Services LLC (“Piedmont”), a North Carolina limited liability company, wholly owned subsidiary of Limco-Piedmont Inc., and Turbochrome Ltd. (“Turbochrome”). Additionally, the Company holds 51% of TAT-Engineering LLC (“TAT-Engineering”), which was established in January 2016 as a joint venture. The accounting treatment of the joint venture is based on the equity method due to participating rights granted to the other stockholder.
TAT operations is focused on the following four segments: (i) Original Equipment Manufacturing (“OEM”) of heat transfer solutions and aviation accessories mainly through the Kiryat Gat facility; (ii) Maintenance Repair and Overhaul (“MRO”) services for heat transfer components and OEM of heat transfer solutions through Limco; (iii) MRO services for aviation components (mainly Auxiliary Power Unit (“APU”) and Landing Gear (“LG”)) through Piedmont ; and (iv) overhaul and coating of jet engine components through Turbochrome. TAT targets the commercial aerospace (serving a wide range of types and sizes of commercial and business jets), military aerospace and ground defense sectors. TAT’s shares are listed on both the NASDAQ (TATT) and Tel-Aviv Stock Exchange (“TAT Tech”).
In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Following the attack by Hamas on Israel’s southern border, Hezbollah in Lebanon has also launched missile, rocket, and shooting attacks against Israeli military sites, troops, and Israeli towns in Northern Israel. Following the attacks, Israel’s security cabinet declared war against Hamas and a military campaign against these terrorist organizations commenced in parallel to their continued rocket and terror attacks. In addition, Israel faces threats from more distant neighbors such as terrorist groups in Yemen, which attached Israel and limited the movement of marine shipments to Israel through the Red Sea. Further, on June 13, 2025, the Israel’s security cabinet declared a military operation against Iran, while Iran, in retaliation, launched hundreds of ballistic missiles toward Israel, some of which reached central areas. While most were intercepted by Israel’s multi-layered air defense systems, injuries were reported, and several casualties occurred. On June 24, 2025, a ceasefire was implemented between Iran and Israel and, as of the date hereof, remains in place. In October 2025, a U.S.-brokered cease-fire between Israel and Hamas took effect. The cease-fire remains in place; however, its stability and duration remain uncertain. To date, the Company’s operations and financial results have not been materially affected by these events.
Also, since this is an event beyond the Company’s control and may impact our Israeli activity, its continuation or cessation may affect our expectations. The Company continues to monitor its ongoing activities and will make any needed adjustments to ensure continuity of its business, while supporting the safety and well-being of its employees. For the three and nine months ended on September 30, 2025, the Group’s activity in Israel contributed $12,207 and $36,339 out of total revenue of $46,235 and $131,481, respectively.
Furthermore, during 2025, global conflicts continue to create volatility in global financial and energy markets and contribute to supply chain shortages adding to the inflationary pressures in the global economy. These lead to higher material and labor costs, and as a result the Company decided to retain higher inventory levels. The Company actively collaborates with its suppliers to minimize the impacts of supply shortages on manufacturing and MRO services.
International operations are subject to a number of other risks, including import and export laws and the impact of tariffs. Changes in global tariff regimes, whether recently implemented or anticipated, may have broader implications for the Company’s operations. These may include increased volatility in purchasing prices due to shifting import costs, particularly with respect to raw materials and components sourced internationally. Furthermore, elevated tariffs can affect the pricing structure and profitability of cross-border transactions, potentially requiring adjustments to existing contracts with customers and suppliers located outside of the United States. While the full impact of these tariffs remains uncertain, since the Company serves its U.S. customers from production facilities in the U.S., the Company has ability to negotiate, and the tariffs will be substantially pass to customers. The Company is expecting minimal to no impact from the changes above.

F - 8

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

| a. | Basis of Presentation

The accompanying interim consolidated balance sheet as of September 30, 2025, the interim consolidated statements of income, interim statements of cash flows and the interim consolidated statements of shareholders’ equity for the three and nine months ended September 30, 2025 and 2024 are unaudited. These unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting.
In management’s opinion, the unaudited interim consolidated financial statements include all adjustments of a normal recurring nature necessary for the fair statement of the Company’s financial position as of September 30, 2025, as well as its results of operations and cash flows for the three and nine months ended September 30, 2025 and 2024.
The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025, or for other interim periods or for future years.
The accompanying unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2024 (the “2024 Annual Report”) filed with the Securities and Exchange Commission (the “SEC”) on March 26, 2025.

| b. | Fair value measurement

The Group measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

| ◾ | Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

| ◾ | Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data or active market data for similar but not identical assets or liabilities.

| ◾ | Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, the Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers credit risk in its assessment of fair value. During 2024, the Company ceased its hedging activity. As of September 30, 2025, the Company does not hold financial instruments measured at fair value on a recurring basis. The Company’s financial instruments consist mainly of cash and cash equivalents, restricted deposits, accounts receivable, accounts payable, accrued expenses and other liabilities. The fair value of these financial instruments approximates their carrying value.

F - 9

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

| c. | Significant Accounting Policies

There have been no changes to the significant accounting policies described in the 2024 Annual Report that have had a material impact on the unaudited interim consolidated financial statements and related notes.

| d. | Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose the nature of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting years. Actual results could differ from those estimates.
As applicable to these financial statements, the most significant estimates and assumptions relate to recoverability of inventory, provision for current expected credit loss, and income taxes.

| e. | Concentrations of Credit Risk

Financial instruments that potentially subject the Group to concentrations of credit risk consist principally of cash and cash equivalents and deposits, derivatives and accounts receivable.
Cash and cash equivalents are deposited with several major banks in Israel and the United States. Such deposits in the United States and Israel may be in excess of insured limits and are not insured in other jurisdictions. Management believes that the financial institutions that hold the Group's cash and cash equivalents are financially sound, and that the Group has not been affected by certain banking institutions in the U.S. Accordingly, minimal credit risk exists with respect to these financial instruments.
The Group has a relatively large number of customers with established private and public companies, and governmental institutions which mitigate the credit risk. The Group performs ongoing credit evaluation of its customers' financial condition. As part of the risk management, the Company purchased a credit insurance policy from a well-known insurance Company. As of September 30, 2025 and December 31, 2024 the Company has a single customer which represents 15% and 24% of the Company's accounts receivable, respectively.

| f. | Recently issued accounting pronouncements, not yet adopted

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which requires disclosure of disaggregated income taxes paid, prescribes standard categories for the components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. The ASU will be effective for fiscal years beginning after December 15, 2025, and allows adoption on a prospective basis, with a retrospective option. The Company is in the process of assessing the impact and method of adoption.
In November 2024, the FASB issued ASU No. 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). The ASU improves the disclosures about a public business entity’s expense and provides more detailed information about the types of expenses in commonly presented expense captions. The amendments require that at each interim and annual reporting period an entity will disclose amounts of purchases of inventory, employee compensation, depreciation and amortization included in each relevant expense caption (such as cost of sales, SG&A and research and development). The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures.
On July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). ASU 2025-05 provides a practical expedient that all entities can use when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, Revenue from Contracts with Customers. Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim reporting periods in those years. Entities that elect the practical expedient and, if applicable, make the accounting policy election are required to apply the amendments prospectively. The Company is currently evaluating the potential impact of this guidance on its consolidated financial statements and disclosures.

F - 10

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 3 - INVENTORY
Inventory is composed of the following:

|  | September 30, 2025 |  |  | December 31, 2024 |
Raw materials and components |  | $ | 61,480 |  |  | $ | 50,197 |
Work in progress |  |  | 15,854 |  |  |  | 17,382 |
Finished goods |  |  | 837 |  |  |  | 961 |
Total inventory |  | $ | 78,171 |  |  | $ | 68,540 |

Inventories write down expenses due to slow inventory amounted to $294 and $254 for the three months ended September 30, 2025 and 2024, respectively. Inventories write down expenses due to slow inventory amounted to $884 and $494 for the nine months ended September 30, 2025 and 2024, respectively.
The Company maintains a wide range of exchangeable units and other spare parts related to its products and services in various locations. Due to the long lead time of its suppliers and manufacturing cycles, the Company needs to forecast demand and commit significant resources towards these inventories. As such, the Company is subject to risks including excess inventory no longer relevant.

NOTE 4 - COMMITMENTS AND CONTINGENCIES

| a. | Royalty commitments

The Company is committed to paying royalties as percentage of revenue or as a percentage of purchase in the amount range from 5% to 25% to certain OEM as part of the Company’s licenses agreements. Royalties expense was $1,746 and $1,408 for the three months ended September 30, 2025 and 2024, respectively. Royalties expense was $4,208 and $3,622 for the nine months ended September 30, 2025 and 2024, respectively.

| b. | Litigation

On July 12, 2022, TAT filed a suit against TAT Industries Ltd. in the District Court of Tel Aviv. TAT had leased the Gedera facility from TAT Industries Ltd. until the termination of the lease agreement in 2022. TAT asserts that TAT Industries Ltd. has unlawfully forfeited a bank guarantee that was granted for the benefit TAT Industries Ltd. in connection with the lease in Gedera in the amount of $750 thousands. On December 28, 2022, TAT Industries Ltd. filed a counterclaim against TAT asserting damages caused by TAT in connection with the lease in Gedera. The evidentiary hearings concluded on June 29, 2025, and the parties are expected to complete their closing arguments by November 25, 2025. TAT intends to vigorously defend the counterclaim by TAT Industries Ltd. and TAT estimates that is not probable that TAT Industries Ltd.’s claim against TAT will be approved.

F - 11

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 4 - COMMITMENTS AND CONTINGENCIES (CONT)

| c. | Leases

In April 2025, Piedmont signed a renewal of lease agreement for a facility in Greensboro, North Carolina, U.S., for 5 years, with a lease term commencing on July 1, 2025, and that will expire on June 30, 2030. Piedmont has an option of extending the terms of the lease for another 5 years, commencing upon expiration of the extended term. This option was not considered in the calculation of the ROU assets and lease liability. As a result, the Company recognized an ROU assets and related operating lease liability of approximately $1.6 million.
In May 2025, Limco signed a new lease agreement for an R&D facility in North Carolina, U.S., with a lease term of 10 years that will expire on April 30, 2035. Limco has the right to terminate the lease at the end of the 7th year subject to payment of termination fee of $225 thousand plus other charges. As a result, the Company recognized an ROU assets and related operating lease liability of approximately $1.0 million.
In August 2025, TAT signed a new lease agreement for a facility in Kiryat Gat, Israel, with a lease term of 5 years that will expire in August 2030. TAT has an option of extending the terms of the lease for another 5 years, commencing upon expiration of the new lease term. This option was not considered in the calculation of the ROU assets and lease liability. As a result, the Company recognized an ROU assets and related operating lease liability of approximately $0.9 million.
The Company used a discount rate for the above non-cancellable operating leases ranging from 6.65% to 7.59% in the U.S and 5.22% in Israel.

NOTE 5 - EARNINGS PER SHARE (“EPS”)
Basic earnings per share are based on the weighted average number of ordinary shares outstanding, net of treasury shares. Diluted EPS is based on those shares used in basic EPS plus shares that would have been outstanding assuming issuance of ordinary shares for all dilutive potential ordinary shares outstanding.

|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Numerator for EPS: |  |  |  |  |  |  |  |  |  |  |  |
Net income |  | $ | 4,841 |  |  | $ | 2,865 |  |  | $ | 12,096 |  |  | $ | 7,592 |
Denominator for EPS: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Weighted average shares outstanding – basic |  |  | 12,911,050 |  |  |  | 10,609,867 |  |  |  | 11,776,747 |  |  |  | 10,462,012 |
Dilutive shares |  |  | 167,417 |  |  |  | 219,882 |  |  |  | 127,297 |  |  |  | 593,251 |
Weighted average shares outstanding – diluted |  |  | 13,078,467 |  |  |  | 10,829,749 |  |  |  | 11,904,044 |  |  |  | 11,055,263 |
EPS: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | 0.37 |  |  | $ | 0.27 |  |  | $ | 1.03 |  |  | $ | 0.73 |
Diluted |  | $ | 0.37 |  |  | $ | 0.26 |  |  | $ | 1.02 |  |  | $ | 0.69 |

F - 12

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 6 - EQUITY TRANSACTION

| a. | Stock options

In February 2025, the Board of Directors approved the grant of 230 thousand options to officers and senior executives of the Company under the terms and conditions of the 2012 and 2022 Stock Option Plans. The grants have an exercise price of $29.93 per share, a grant date fair value of $2,444 thousand.
In August 2025, the Board of Directors approved the grants of the following options to officers and senior executives of the Company under the terms and conditions of the 2022 Stock Option Plans:

| i. | 50 thousand options with an exercise price of $29.93 per share, a grant date fair value of $842 thousand.

| ii. | 50 thousand options with an exercise price of $38.91 per share, a grant date fair value of $798 thousand.

| iii. | 110 thousand options with an exercise price of $38.27 per share, a grant date fair value of $1,892 thousand

The above share-based awards will vest over four years, of which 25% shall vest after 12 months of the date of grant; and 6.25% shall vest at the end of each 3 months after the first anniversary of the date of grant. The fair value of share-based awards is estimated using the Black-Scholes valuation model and is recognized as stock base compensation expense over the requisite service period, net of estimated forfeitures. The fair value of the share-based awards for the nine months ended September 30, 2025 was estimated using the following assumptions: (1) expected volatility of 50.0%, (2) expected option life of 4.61 years, (3) risk free interest rate ranging to 3.67% to 4.30% and (4) dividend yield of 0%. As of September 30, 2025, the total unrecognized compensation expense is $6,162 with a weighted average unrecognized compensation period of 1.77 years.

| b. | Increase authorized shares

At a special shareholder meeting in March 2025, TAT’s shareholders approved the increase of its authorized share capital from 13,000,000 to 15,000,000.

| c. | Public offering

On June 3, 2025, the Company completed a public offering of 1,625,000 of its ordinary shares, no par value per share, at a public offering price of $26.00 per share for gross proceeds of $42.3 million. The issuance costs incurred were $2.8 million, hence, generating net proceeds of $39.4 million.
In addition, 2,525,000 ordinary shares were sold by existing shareholders as part of the same offering.
On June 26, 2025, the underwriters exercised in full their option to purchase an additional 242,298 ordinary shares from the Company and 380,202 ordinary shares from selling stockholders at offering price of $26.00. The issuance costs incurred were $0.4 million. This resulted in additional net proceeds of approximately $6.0 million to the Company.
The net proceeds for the Company from this public offering after issuance costs is $45.4 million.

F - 13

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 7 - SEGMENT INFORMATION

| a. | Segment Activities Disclosure:

TAT operates under four segments: (i) OEM of heat transfer solutions and aviation accessories mainly through its Kiryat Gat facility; (ii) MRO services for heat transfer components and OEM of heat transfer solutions through its Limco subsidiary; (iii) MRO services for aviation components (mainly APU and LG) through its Piedmont subsidiary; and (iv) Overhaul and coating of jet engine components through its Turbochrome subsidiary.

| ◾ | OEM of heat transfer solutions and aviation accessories primarily include the design, development and manufacture of (i) broad range of heat transfer solutions, such as pre-coolers heat exchangers and oil/fuel hydraulic heat exchangers, used in mechanical and electronic systems on board of commercial, military and business aircraft; (ii) environmental control and power electronics cooling systems installed on board aircraft in and ground applications; and (iii) a variety of other mechanical aircraft accessories and systems such as pumps, valves, and turbine power units.

| ◾ | MRO services for heat transfer components and OEM of heat transfer solutions primarily include the MRO of heat transfer components and to a lesser extent, the manufacturing of certain heat transfer solutions. TAT’s Limco subsidiary operates an FAA-certified repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers and the military.

| ◾ | MRO services for aviation components include the MRO of APUs, landing gears and other aircraft components, as well as APU lease activity. TAT’s Piedmont subsidiary operates an FAA-certified repair station, which provides aircraft component MRO services for airlines, air cargo carriers, maintenance service centers and the military.

| ◾ | TAT’s activities in the area of overhaul and coating of jet engine components includes the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes and afterburner flaps.

The Group’s chief operating decision-maker ("CODM") is the CEO of the Company. The CODM evaluates segment performance and allocates the Company’s resources, the CODM uses segment measures of revenue, gross profit, operating income and total assets. The CODM reviews budget-to-actual variances of both profit measures on a monthly basis when making decisions about allocation of the Company’s resources to the segments.

F - 14

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 7 - SEGMENT INFORMATION (CONT)

| b. | Segments statement operations disclosure:

The following financial information is the information that CODM uses for analyzing the segment results. The following financial information is a summary of the operating income of each operational segment:

|  | Nine Months Ended September 30, 2025 |
|  | OEM of Heat Transfer Solutions and Aviation Accessories |  |  | MRO Services for heat transfer components and OEM of heat transfer solutions |  |  | MRO services for Aviation Components and Lease |  |  | Overhaul and coating of jet engine components |  |  | Elimination of inter-Company sales |  |  | Consolidated |
Revenues - external |  | $ | 30,091 |  |  | $ | 33,371 |  |  | $ | 61,274 |  |  | $ | 6,745 |  |  | $ | - |  |  | $ | 131,481 |
Revenues - internal |  |  | 497 |  |  |  | 1,506 |  |  |  | - |  |  |  | - |  |  |  | (2,003 | ) |  |  | - |
Cost of revenues |  |  | 21,269 |  |  |  | 25,466 |  |  |  | 50,891 |  |  |  | 3,591 |  |  |  | (2,116 | ) |  |  | 99,101 |
Gross profit |  |  | 9,319 |  |  |  | 9,411 |  |  |  | 10,383 |  |  |  | 3,154 |  |  |  | 113 |  |  |  | 32,380 |
Research and development |  |  | 391 |  |  |  | 494 |  |  |  | - |  |  |  | 2 |  |  |  | - |  |  |  | 887 |
Selling and marketing |  |  | 1,249 |  |  |  | 1,716 |  |  |  | 2,722 |  |  |  | 419 |  |  |  | - |  |  |  | 6,106 |
General and administrative |  |  | 4,106 |  |  |  | 2,594 |  |  |  | 4,337 |  |  |  | 485 |  |  |  | - |  |  |  | 11,522 |
Operating income |  |  | 3,573 |  |  |  | 4,607 |  |  |  | 3,324 |  |  |  | 2,248 |  |  |  | 113 |  |  |  | 13,865 |
Financial expenses, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,128 |
Income before taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 12,737 |

F - 15

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 7 - SEGMENT INFORMATION (CONT)

| b. | Segments statement operations disclosure (cont.)

|  | Nine Months Ended September 30, 2024 |
|  | OEM of Heat Transfer Solutions and Aviation Accessories |  |  | MRO Services for heat transfer components and OEM of heat transfer solutions |  |  | MRO services for Aviation Components and Lease |  |  | Overhaul and coating of jet engine components |  |  | Elimination of inter-Company sales |  |  | Consolidated |
Revenues - external |  | $ | 27,519 |  |  | $ | 30,239 |  |  | $ | 47,808 |  |  | $ | 5,506 |  |  | $ | - |  |  | $ | 111,072 |
Revenues - internal |  |  | 782 |  |  |  | 1,709 |  |  |  | - |  |  |  | - |  |  |  | (2,491 | ) |  |  | - |
Cost of revenues |  |  | 18,400 |  |  |  | 26,884 |  |  |  | 41,736 |  |  |  | 3,127 |  |  |  | (2,606 | ) |  |  | 87,541 |
Gross profit |  |  | 9,901 |  |  |  | 5,064 |  |  |  | 6,072 |  |  |  | 2,379 |  |  |  | 115 |  |  |  | 23,531 |
Research and development |  |  | 288 |  |  |  | 239 |  |  |  | 383 |  |  |  | 36 |  |  |  | - |  |  |  | 946 |
Selling and marketing |  |  | 1,685 |  |  |  | 1,489 |  |  |  | 2,170 |  |  |  | 303 |  |  |  | - |  |  |  | 5,647 |
General and administrative |  |  | 2,638 |  |  |  | 2,306 |  |  |  | 3,647 |  |  |  | 349 |  |  |  | - |  |  |  | 8,940 |
Other segment income |  |  | - |  |  |  | (2 | ) |  |  | (388 | ) |  |  | - |  |  |  | - |  |  |  | (390 | )
Operating income |  |  | 5,290 |  |  |  | 1,032 |  |  |  | 260 |  |  |  | 1,691 |  |  |  | 115 |  |  |  | 8,388 |
Financial expenses, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,491 |
Income before taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 6,897 |

F - 16

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 7 - SEGMENT INFORMATION (CONT)

| b. | Segments statement operations disclosure (cont.)

The following financial information is the information that CODM uses for analyzing the segment results. The following financial information is a summary of the operating income of each operational segment:

|  | Three Months Ended September 30, 2025 |
|  | OEM of Heat Transfer Solutions and Aviation Accessories |  |  | MRO Services for heat transfer components and OEM of heat transfer solutions |  |  | MRO services for Aviation Components and Lease |  |  | Overhaul and coating of jet engine components |  |  | Elimination of inter-Company sales |  |  | Consolidated |
Revenues - external |  | $ | 10,397 |  |  | $ | 10,550 |  |  | $ | 22,980 |  |  | $ | 2,308 |  |  | $ | - |  |  | $ | 46,235 |
Revenues - internal |  |  | 160 |  |  |  | 608 |  |  |  | - |  |  |  | - |  |  |  | (768 | ) |  |  | - |
Cost of revenues |  |  | 7,382 |  |  |  | 8,504 |  |  |  | 18,146 |  |  |  | 1,400 |  |  |  | (798 | ) |  |  | 34,634 |
Gross profit |  |  | 3,175 |  |  |  | 2,654 |  |  |  | 4,834 |  |  |  | 908 |  |  |  | 30 |  |  |  | 11,601 |
Research and development |  |  | 73 |  |  |  | 180 |  |  |  | - |  |  |  | 70 |  |  |  | - |  |  |  | 323 |
Selling and marketing |  |  | 345 |  |  |  | 580 |  |  |  | 925 |  |  |  | 143 |  |  |  | - |  |  |  | 1,993 |
General and administrative |  |  | 1,626 |  |  |  | 856 |  |  |  | 1,378 |  |  |  | 165 |  |  |  | - |  |  |  | 4,025 |
Operating income |  |  | 1,131 |  |  |  | 1,038 |  |  |  | 2,531 |  |  |  | 530 |  |  |  | 30 |  |  |  | 5,260 |
Financial income, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 30 |
Income before taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 5,290 |

F - 17

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 7 - SEGMENT INFORMATION (CONT)

| b. | Segments statement operations disclosure (cont.)

|  | Three Months Ended September 30, 2024 |
|  | OEM of Heat Transfer Solutions and Aviation Accessories |  |  | MRO Services for heat transfer components and OEM of heat transfer solutions |  |  | MRO services for Aviation Components and Lease |  |  | Overhaul and coating of jet engine components |  |  | Elimination of inter-Company sales |  |  | Consolidated |
Revenues - external |  | $ | 9,138 |  |  | $ | 10,779 |  |  | $ | 18,645 |  |  | $ | 1,897 |  |  | $ | - |  |  | $ | 40,459 |
Revenues - internal |  |  | 275 |  |  |  | 210 |  |  |  | - |  |  |  | - |  |  |  | (485 | ) |  |  | - |
Cost of revenues |  |  | 6,125 |  |  |  | 9,252 |  |  |  | 16,341 |  |  |  | 733 |  |  |  | (473 | ) |  |  | 31,978 |
Gross profit |  |  | 3,288 |  |  |  | 1,737 |  |  |  | 2,304 |  |  |  | 1,164 |  |  |  | (12 | ) |  |  | 8,481 |
Research and development |  |  | 82 |  |  |  | 83 |  |  |  | 156 |  |  |  | 5 |  |  |  | - |  |  |  | 326 |
Selling and marketing |  |  | 561 |  |  |  | 525 |  |  |  | 793 |  |  |  | 115 |  |  |  | - |  |  |  | 1,994 |
General and administrative |  |  | 633 |  |  |  | 633 |  |  |  | 1,359 |  |  |  | 90 |  |  |  | - |  |  |  | 2,715 |
Operating income |  |  | 2,012 |  |  |  | 496 |  |  |  | (4 | ) |  |  | 954 |  |  |  | (12 | ) |  |  | 3,446 |
Financial expenses, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 735 |
Income before taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 2,711 |

F - 18

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 7 - SEGMENT INFORMATION (CONT)

| c. | The following financial information identifies the assets, depreciation and amortization, and capital expenditures to segments:

|  | Nine Months Ended September 30, 2025 |
|  | OEM of Heat Transfer Solutions and Aviation Accessories |  |  | MRO Services for heat transfer components and OEM of heat transfer solutions |  |  | MRO services for Aviation Components and Lease |  |  | Overhaul and coating of jet engine components |  |  | Amounts not allocated to segments |  |  | Consolidated |
Total assets |  | $ | 76,199 |  |  | $ | 45,533 |  |  | $ | 93,496 |  |  | $ | 10,302 |  |  | $ | (1,395 | ) |  | $ | 224,135 |
Depreciation and amortization |  |  | 648 |  |  |  | 822 |  |  |  | 2,147 |  |  |  | 265 |  |  |  | (120 | ) |  |  | 3,762 |
Expenditure for segment assets |  |  | 2,154 |  |  |  | 571 |  |  |  | 5,990 |  |  |  | 195 |  |  |  | - |  |  |  | 8,910 |

|  | Year Ended December 31, 2024 |
|  | OEM of Heat Transfer Solutions and Aviation Accessories |  |  | MRO Services for heat transfer components and OEM of heat transfer solutions |  |  | MRO services for Aviation Components and Lease |  |  | Overhaul and coating of jet engine components |  |  | Amounts not allocated to segments |  |  | Consolidated |
Total assets |  | $ | 33,726 |  |  | $ | 40,698 |  |  | $ | 80,014 |  |  | $ | 10,182 |  |  | $ | (1,258 | ) |  | $ | 163,362 |
Depreciation and amortization |  |  | 642 |  |  |  | 1,040 |  |  |  | 3,412 |  |  |  | 388 |  |  |  | (27 | ) |  |  | 5,455 |
Expenditure for segment assets |  |  | 1,972 |  |  |  | 1,124 |  |  |  | 1,347 |  |  |  | 683 |  |  |  | - |  |  |  | 5,126 |

F - 19

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 8 - REVENUES

| a. | Total revenues - by geographical location were attributed according to customer residential country as follows:

|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Sale of Products |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 7,619 |  |  | $ | 7,899 |  |  | $ | 22,685 |  |  | $ | 21,832 |
Europe |  |  | 1,182 |  |  |  | 822 |  |  |  | 2,908 |  |  |  | 2,546 |
Israel |  |  | 1,708 |  |  |  | 665 |  |  |  | 5,611 |  |  |  | 2,561 |
Other |  |  | 2,108 |  |  |  | 2,778 |  |  |  | 6,600 |  |  |  | 8,892 |
|  | $ | 12,617 |  |  | $ | 12,164 |  |  | $ | 37,804 |  |  | $ | 35,831 |

|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Sale of Services |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 22,604 |  |  | $ | 21,370 |  |  | $ | 62,445 |  |  | $ | 56,365 |
Europe |  |  | 4,932 |  |  |  | 3,463 |  |  |  | 13,955 |  |  |  | 7,988 |
Israel |  |  | 1,508 |  |  |  | 1,220 |  |  |  | 4,778 |  |  |  | 3,669 |
Other |  |  | 4,574 |  |  |  | 2,242 |  |  |  | 12,499 |  |  |  | 7,219 |
|  | $ | 33,618 |  |  | $ | 28,295 |  |  | $ | 93,677 |  |  | $ | 75,241 |

| b. | Contract liabilities:

|  | September 30, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
Opening balance |  | $ | 6,928 |  |  | $ | 5,239 |
Revenue deferrals |  |  | 4,230 |  |  |  | 7,012 |
Revenue recognized |  |  | (4,611 | ) |  |  | (5,323 | )
Closing balance |  | $ | 6,547 |  |  | $ | 6,928 |

F - 20

TAT TECHNOLOGIES LTD. AND ITS SUBSIDIARIES

UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

NOTE 9 - INCOME TAXES
Income taxes are accounted for in accordance with ASC 740 "Income Taxes". This statement prescribes the use of the asset and liability method; whereby deferred tax assets and liabilities account balances are determined based on temporary differences between financial reporting and tax basis of assets and liabilities and for tax loss carry-forwards. Deferred taxes are measured using the enacted laws and tax rates that will be in effect when the differences are expected to be reversed. The Group provides a valuation allowance, if it is more likely than not that a portion of the deferred income tax assets will not be realized.
The Group’s consolidated interim effective tax rate is based upon expected annual income from operations, statutory tax rates, and tax laws in the various jurisdictions in which the Group operates. Significant or unusual items, including those related to the change in U.S. tax law as well as other adjustments to accruals for tax uncertainties, are recognized in the quarter in which the related event occurs.
On July 4, 2025, the U.S. enacted H.R. 1 "A bill to provide for reconciliation pursuant to Title II of H. Con. Res. 14", commonly referred to as the One Big Beautiful Bill Act ("OBBBA", or "OB3"). OB3 contains a broad range of provisions affecting businesses, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, including provisions related to bonus depreciation and immediately expensing domestic research and development, as well as modifications to foreign derived intangible income and the restoration of other favorable tax provisions. The legislation has multiple effective dates, with certain provisions, including elective 100% bonus depreciation for assets placed in service after January 19, 2025, with many others generally not effective until 2026 through 2027. The effects of the new legislation are recognized upon enactment.
For the three months ended September 30, 2025 and 2024, the Group's effective tax rate was 14% and 1%, respectively. For the three months ended September 30, 2025, the Group's effective tax rate was impact to the greater extent by the Group’s generated income before taxes for the period and some extent the change in tax law enacted, in accordance with OB3.The restoration of 100% bonus depreciation has increased deferred tax liability, and the immediate expensing of domestic research and development and change in interest expense limitation has created a decrease in deferred tax assets. As a result of these additional current deductions brought by these three changes, the U.S. subsidiaries utilized less net operating loss carryover to offset taxable income in tax year 2025. Hence, the overall impact of the OB3 adoption by the U.S subsidiaries was not significant. For the three months ended September 30, 2024, the Group's effective tax rate was reduced by deferred tax impact of pre-tax losses.

NOTE 10 - SUBSEQUENT EVENTS
On November 4, 2025, at the Annual and Special General Meeting of the shareholders a resolution was approved to increase the authorized capital stock of the Company from 15,000,000 ordinary shares to 19,000,000 ordinary shares.

F - 21