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What changed in ESCO TECHNOLOGIES INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ESCO TECHNOLOGIES INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+173 added−166 removedSource: 10-K (2025-12-01) vs 10-K (2024-11-29)

Top changes in ESCO TECHNOLOGIES INC's 2025 10-K

173 paragraphs added · 166 removed · 135 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

47 edited+16 added−12 removed34 unchanged
Biggest changeThis decision was made as part of our continued strategic portfolio analysis, which is focused on positioning us to serve high-growth markets that have high margin potential. During this review process, we remain committed to continuing the execution of our current Space programs to serve the needs of our customers. Products Our principal products are described below.
Biggest changeIn July 2025, following a strategic review of our Space business, we completed the sale of our former A&D subsidiary VACCO Industries (VACCO) for net sales proceeds of approximately $270 million. The sale was made as part of our strategic portfolio analysis, which is focused on positioning us to serve high-growth markets that have high margin potential.
Doble has obtained and is pursuing additional patent protection on improvements to its line of diagnostic equipment and NERC CIP compliance tools and its Calisto R9 dissolved gas analyzer.
Doble has obtained and is pursuing additional patent protection on improvements to its line of diagnostic equipment, NERC CIP compliance tools, and its Calisto R9 dissolved gas analyzer.
Tucker has been Senior Vice President and Chief Financial Officer since April 2021. Since joining ESCO, he has prioritized broadening the capabilities of the finance and IT teams at ESCO while also strengthening financial reporting and planning systems. Prior to joining ESCO, Mr. Tucker worked at Emerson Electric Co.
Tucker has been Senior Vice President and Chief Financial Officer since April 2021. Since joining ESCO, he has prioritized broadening the capabilities of the finance and IT teams while also strengthening financial reporting and planning systems. Prior to joining ESCO, Mr. Tucker worked at Emerson Electric Co.
We strive to maintain a culture that enables all employees to be treated with dignity and respect while performing their jobs to the best of their abilities. We operate in a supportive culture that incorporates strong ethical behavior and reinforces our human rights commitment through annual training on ethics, human rights, anti-human trafficking and anti-harassment.
We strive to maintain a culture that enables all employees to be treated with dignity and respect while performing their jobs to the best of their abilities. We operate in a supportive culture that incorporates strong ethical behavior and reinforces our human rights commitment through annual training on ethics, human rights, anti-human trafficking and harassment prevention.
Their respective businesses are subject to a number of risks and uncertainties, including without limitation those discussed in Item 1A, “Risk Factors.” See also Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Forward-Looking Information.” We are continually seeking ways to reduce our overall operating costs, streamline business processes and enhance the branding of our products and services.
Their respective businesses are subject to a number of risks and uncertainties, including without limitation those discussed in Item 1A, “Risk Factors.” See also Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Forward-Looking Information.” Table of Contents We are continually seeking ways to reduce our overall operating costs, streamline business processes and enhance the branding of our products and services.
Sayler led our Utility Solutions Group from 2016 through 2022, where he played a key role in strategically building out the group, including leading our entry into the renewables business and overseeing six successful acquisitions that more than doubled the size of the segment. From 1995 to 2016, he held senior positions with ETS-Lindgren. Christopher L. Tucker 53 Mr.
Sayler led our Utility Solutions Group from 2016 through 2022, where he played a key role in strategically building out the group, including leading our entry into the renewables business and overseeing six successful acquisitions that more than doubled the size of the segment. From 1995 to 2016, he held senior positions with ETS-Lindgren. Christopher L. Tucker 54 Mr.
Throughout this Annual Report, unless the context indicates otherwise, references to a year (for example 2024) refer to our fiscal year ending on September 30 of that year, and references to the “Consolidated Financial Statements” refer to our Consolidated Financial statements included in the Financial Information section of this Annual Report beginning on page F-1, an Index to which is provided on page F-1.
Throughout this Annual Report, unless the context indicates otherwise, references to a year (for example 2025) refer to our fiscal year ending on September 30 of that year, and references to the “Consolidated Financial Statements” refer to our Consolidated Financial statements included in the Financial Information section of this Annual Report beginning on page F-1, an Index to which is provided on page F-1.
These officers are elected annually to terms which expire at the first meeting of the Board of Directors held after the Annual Meeting of Stockholders. ​ ​ ​ ​ ​ ​ Name Age Position(s) and Business Experience Bryan H. Sayler ​ 58 ​ Mr. Sayler has been the Company’s President and Chief Executive Officer since January 1, 2023. Mr.
These officers are elected annually to terms which expire at the first meeting of the Board of Directors held after the Annual Meeting of Stockholders. ​ ​ ​ ​ ​ ​ Name Age Position(s) and Business Experience Bryan H. Sayler ​ 59 ​ Mr. Sayler has been the Company’s President and Chief Executive Officer since January 1, 2023. Mr.
Item 1. Business The Company The Registrant is ESCO Technologies Inc., sometimes referred to in this report as ESCO. Except where the context indicates otherwise, the terms “Company”, “we”, “our” and “us” are used in this report to refer to ESCO together with its subsidiaries through which its businesses are conducted.
Item 1. Business The Company The Registrant is ESCO Technologies Inc. (NYSE: ESE), sometimes referred to in this report as ESCO. Except where the context indicates otherwise, the terms “Company”, “we”, “our” and “us” are used in this report to refer to ESCO together with its subsidiaries through which its businesses are conducted.
(NYSE:EMR) for 24 years, most recently as Vice President and Chief Financial Officer of Emerson’s Commercial and Residential Solutions business segment. David M. Schatz 61 Mr. Schatz has been Senior Vice President, General Counsel and Secretary since April 2021.
(NYSE: EMR) for 24 years, most recently as Vice President and Chief Financial Officer of Emerson’s Commercial and Residential Solutions business segment. David M. Schatz 62 Mr. Schatz has been Senior Vice President, General Counsel and Secretary since April 2021.
All Government prime contracts and virtually all 3 Table of Contents of our Government subcontracts provide that they may be terminated at the convenience of the Government or the customer. Upon a termination for convenience, we are entitled to receive equitable compensation from the customer for the work we completed prior to termination.
All Government prime contracts and virtually all of our Government subcontracts provide that they may be terminated at the convenience of the Government or the customer. Upon a termination for convenience, we are entitled to receive equitable compensation from the customer for the work we completed prior to termination.
It serves the acoustics, medical, health and safety, electronics, wireless communications, automotive and defense markets, providing a broad range of turnkey systems, including RF test facilities and measurement systems, acoustic test enclosures, RF and magnetically shielded rooms, and secure communication facilities.
It serves the medical, health and safety, electronics, wireless communications, automotive and defense markets, providing a broad range of turnkey systems, including RF test facilities and measurement systems, RF and magnetically shielded rooms, and secure communication facilities.
We remain committed to our communities, including through financial support from the ESCO Foundation and through personal participation of our employees with a variety of local organizations, such as area food banks, blood drives, community outreach, Special Olympics, Habitat for Humanity, Big Brothers Big Sisters, United Way and many other favored local charities.
We remain committed to our communities, including through financial support from the ESCO Foundation and through personal participation of our employees with a variety of local organizations, such as area food banks, blood drives, community outreach, Special Olympics, Habitat for Humanity, Big Brothers Big Sisters, Ronald McDonald House, and many other favored local charities.
Nonetheless, in some situations, there is a risk of shortages due to reliance on a limited number of suppliers or because of price fluctuations due to the nature of the raw materials. For example, aerospace-grade titanium and gaseous helium, important raw materials for our A&D segment subsidiaries, may at times be in short supply.
Nonetheless, in some situations, there is a risk of shortages due to reliance on a limited number of suppliers or because of price fluctuations due to the nature of the raw materials. For example, aerospace-grade titanium, an important raw material for our A&D segment subsidiaries, may at times be in short supply.
Of our total backlog at September 30, 2024, approximately 70% is expected to be completed in the fiscal year ending September 30, 2025. 4 Table of Contents Purchased Components and Raw Materials Our products require a wide variety of components and materials.
Of our total backlog at September 30, 2025, approximately 64% is expected to be completed in the fiscal year ending September 30, 2026. 4 Table of Contents Purchased Components and Raw Materials Our products require a wide variety of components and materials.
We classify our business operations into three segments for financial reporting purposes, although for reporting certain financial information we treat Corporate activities as a separate segment. Our three operating segments during 2024, together with the significant domestic and foreign operating subsidiaries within each segment, are as follows: Aerospace & Defense (A&D): PTI Technologies Inc. (PTI) VACCO Industries (VACCO) Crissair, Inc.
We classify our business operations into three segments for financial reporting purposes, although for reporting certain financial information we treat Corporate activities as a separate segment. Our three operating segments during 2025, together with the significant domestic and foreign operating subsidiaries or businesses within each segment, are as follows: Aerospace & Defense (A&D): PTI Technologies Inc. (PTI) Crissair, Inc.
Examples of such inventions include novel designs for window and door assemblies used in shielded enclosures and anechoic chambers, improved acoustic techniques for sound isolation and a variety of unique antennas. In addition, the Test segment holds a number of patents, and has patents pending, on products used to perform wireless device testing.
Examples of such inventions include novel designs for window and door assemblies used in shielded enclosures and a variety of unique antennas. In addition, the Test segment holds a number of patents, and has patents pending, on products used to perform wireless device testing.
See also Item 1A, “Risk Factors.” Primary competitors of our A&D segment include Pall Corporation (a subsidiary of Danaher Corporation), Moog, Inc., Safran (Sofrance), CLARCOR Inc., TransDigm (PneuDraulics), Marotta Controls, Parker Hannifin, and Collins Aerospace. Significant competitors of our USG segment include OMICRON Electronics Corp., Megger Group Limited, Vaisala, and Qualitrol Company LLC (a subsidiary of Fortive Corporation).
See also Item 1A, “Risk Factors.” Significant competitors of our A&D segment include Pall Corporation (a subsidiary of Danaher Corporation), Moog, Inc., Safran (Sofrance), CLARCOR Inc., TransDigm (PneuDraulics), Parker Hannifin, Collins Aerospace, L3 Harris and Leonardo DRS. Significant competitors of our USG segment include OMICRON Electronics Corp., Megger Group Limited, Vaisala, and Qualitrol Company LLC (a subsidiary of Ralliant Corporation).
Given the ever-changing talent market, we have looked to broaden the ways in which we can recognize and reward performance, including more frequent merit increases, market adjustments, spot bonuses and other creative ways to recognize and reward employees. By utilizing these and other measures, at the end of our fiscal year the average tenure of our workforce was 9 years.
Given the ever-changing talent market, we regularly recognize and reward performance, including merit increases, market adjustments, spot bonuses and other creative ways to recognize and reward employees. By utilizing these and other measures, at the end of our fiscal year the average tenure of our workforce was 9 years.
He has worked at ESCO since 1998 in various positions with increasing responsibility, including serving as Vice President, IP Counsel and Assistant Secretary from 2015 until April 2021. He has extensive knowledge of ESCO’s operations, technologies, intellectual property, regulatory matters, M&A and other complex legal matters. There are no family relationships among any of our executive officers and directors. ​
He has worked at ESCO since 1998 in various positions with increasing responsibility, including serving as Vice President, IP Counsel and Assistant Secretary from 2015 until April 2021. He has extensive knowledge of ESCO’s operations, technologies, intellectual property, regulatory matters, M&A and other complex legal matters.
Our sales to international customers accounted for approximately 28%, 30% and 30% of our total revenue in 2024, 2023 and 2022, respectively. See Note 9 to the Consolidated Financial Statements for financial information by geographic area. See Item 1A, “Risk Factors,” for a discussion of risks related to our international operations.
Our sales to international customers accounted for approximately 34%, 31% and 33% of our total revenue from continuing operations in 2025, 2024 and 2023, respectively. See Note 10 to the Consolidated Financial Statements for financial information by geographic area. See Item 1A, “Risk Factors,” for a discussion of risks related to our international operations.
All of our facilities are in material compliance with appliable Government regulations and executive orders. See Item 1A, “Risk Factors,” for a discussion of risks related to our Government business. Intellectual Property We own or have other rights in various forms of intellectual property (i.e., patents, trademarks, service marks, copyrights, mask works, trade secrets and other items).
See Item 1A, “Risk Factors,” for a discussion of risks related to our Government business. 3 Table of Contents Intellectual Property We own or have other rights in various forms of intellectual property (i.e., patents, trademarks, service marks, copyrights, mask works, trade secrets and other items).
The segment’s operations consist primarily of ETS-Lindgren, an industry leader in designing and manufacturing products and systems to measure and control RF and acoustic energy for research and development, regulatory compliance, and medical and security applications.
This segment has five facilities in the United States and eight outside the United States. The segment’s operations consist primarily of ETS-Lindgren, an industry leader in designing and manufacturing products and systems to measure and control RF energy for research and development, regulatory compliance, and medical and security applications.
We estimate that as of September 30, 2024, domestic customers accounted for approximately 78% of our total firm orders and international customers accounted for approximately 22%.
We estimate that as of September 30, 2025, domestic customers accounted for approximately 69% of our total firm orders and international customers accounted for approximately 31%.
We are also continuing to seek opportunities to supplement our growth by making strategic acquisitions. In November 2023 we acquired MPE Limited (MPE), a United Kingdom-based global manufacturer of high-performance products for military, utility, telecommunication and other critical infrastructure applications. In February 2023 we acquired CMT Materials, LLC and its affiliate Engineered Syntactic Systems, LLC (together, CMT).
In November 2023, we acquired MPE Limited (MPE), a United Kingdom-based global manufacturer of high-performance products for military, utility, telecommunication and other critical infrastructure applications. In February 2023 we acquired CMT Materials, LLC and its affiliate Engineered Syntactic Systems, LLC (together, CMT).
The segment’s operations consist primarily of Doble Engineering Company, Morgan Schaffer and Altanova (collectively, Doble), and NRG. Doble is an industry leader in the development, manufacture and delivery of diagnostic testing and data management solutions that enable electric power grid operators to assess the integrity of high-voltage, high-current and high-power delivery equipment.
Doble is an industry leader in the development, manufacture and delivery of diagnostic testing and data management solutions that enable electric power grid operators to assess the integrity of high-voltage, high-current and high-power delivery equipment.
See Item 1A, “Risk Factors.” A number of products in the Aerospace & Defense segment are based on patented or otherwise proprietary technology that sets them apart from the competition, such as PTI’s metal fiber media filter elements and Westland’s signature reduction solutions. In addition, Globe has developed significant manufacturing and logistics capability utilized for special hull treatments for submarines.
See Item 1A, “Risk Factors.” A number of products in the A&D segment are based on patented or otherwise proprietary technology that sets them apart from the competition, such as PTI’s metal fiber media filter elements and Westland’s signature reduction solutions.
Our engagement strategy focuses on attracting, developing and retaining world-class talent to maximize customer value. This year we conducted our first-ever global engagement survey which measured five primary engagement drivers as well as our company values: Integrity, Teamwork, Customer Service, Safety, Innovation and Quality.
Our engagement strategy focuses on attracting, developing and retaining world-class talent to maximize customer value. This was the second year we conducted a global engagement survey which measured five primary engagement drivers as well as our core values.
The majority of full-time domestic and international employees are eligible for bonus or commission plans, most of which are designed to incentivize and reward performance based on results such as EPS, EBIT, cash flow, quality and backlog reduction, or other measures.
All full-time domestic and international employees are eligible for bonus or commission plans, most of which are designed to incentivize and reward performance based on results such as EPS, EBIT, cash flow, quality and backlog reduction, or other measures. 6 Table of Contents We recognize that our success is based on the talents and dedication of those we employ, and we are invested in their success.
We consider our patents and other intellectual property to be of significant value to each of our segments. Backlog Total Company backlog of firm orders at September 30, 2024 was $879.0 million, representing an increase of $106.6 million (13.8%) from the backlog of $772.4 million at September 30, 2023.
We consider our patents and other intellectual property to be of significant value to each of our segments. Backlog Total Company backlog of firm orders at September 30, 2025 was $1,133.6 million, representing an increase of $469.4 million (70.7%) from the backlog from continuing operations of $664.2 million at September 30, 2024.
We believe strong human capital is a competitive differentiator, and we focus on ensuring we have the right domestic and international talent in place to drive our strategic initiatives not only today but well into the future.
We believe strong human capital is a competitive differentiator, and we focus on ensuring we have the right domestic and international talent in place to drive our strategic initiatives not only today but well into the future. Financing For information about our credit facility, see Note 7 to the Consolidated Financial Statements, which is incorporated into this Item by reference.
The companies within this segment primarily design and manufacture specialty filtration, fluid control and naval products, including hydraulic filter elements, fluid control devices and precision-tolerance machined components used in aerospace and defense applications, unique filter mechanisms used in micro- 2 Table of Contents propulsion devices for satellites, custom designed filters for manned aircraft and submarines, products and systems to reduce vibration and/or acoustic signatures and otherwise reduce or obscure a vessel’s signature, and other communications, sealing, surface control and hydrodynamic related applications to enhance U.S.
The companies within this segment primarily design and manufacture specialty filtration, fluid control and naval products, including hydraulic filter elements, fluid control devices and precision-tolerance machined components used in aerospace and defense applications, naval magnetic signature management systems, naval power control and conversion systems, products and systems to reduce vibration and/or acoustic signatures and otherwise reduce or obscure a vessel’s signature, and other communications, sealing, surface control and hydrodynamic related applications to enhance U.S. and UK Navy maritime survivability; and miniature electro-explosive devices for military aircraft ejection seats and missile arming devices.
NRG is a global market leader in the design and manufacture of decision support tools for the renewable energy industry, primarily wind and solar. Test Our Test segment accounted for approximately 20%, 23% and 27% of our total revenue in 2024, 2023 and 2022, respectively. This segment has four facilities in the United States and seven outside the United States.
NRG is a global market leader in the design and manufacture of decision support tools for the renewable energy industry, primarily wind and solar. 2 Table of Contents Test Our Test segment accounted for approximately 21%, 23% and 26% of our total revenue from continuing operations in 2025, 2024 and 2023, respectively.
By segment, the backlog at September 30, 2024 and September 30, 2023, respectively, was $600.4 million and $484.1 million for A&D; $120.0 million and $133.5 million for USG; and $158.6 million and $154.8 million for Test.
By segment, the backlog at September 30, 2025 and September 30, 2024, respectively, was $803.0 million and $385.6 million for A&D; $143.4 million and $120.0 million for USG; and $187.2 million and $158.6 million for Test.
It combines three core elements for customers – diagnostic test instruments and condition monitoring systems, expert consulting, and testing services – and provides access to its large reserve of related empirical knowledge. Altanova provides a significant international platform for Doble by representing our products and solutions in markets outside North and South America and Canada.
It combines three core elements for customers – diagnostic test instruments and condition monitoring systems, expert consulting, and testing services – and provides access to its large reserve of related empirical knowledge.
We are: ● A global provider of highly engineered filtration and fluid control products and integrated propulsion systems for the aviation, navy, space and process markets worldwide, as well as composite-based products and solutions for navy, defense and industrial customers; ● An industry leader in radio frequency (RF) shielding and electromagnetic compatibility (EMC) test products; and ● A provider of diagnostic instruments, software and services for the benefit of the electric utility and renewable energy industries and industrial power users.
We are: ● A global provider of highly engineered components and systems for aviation, Navy, defense and industrial customers; ● An industry leader in designing and manufacturing radio frequency (RF) test and measurement products and systems; and ● A provider of diagnostic instruments, software and services to industrial power users and the electric utility and renewable energy industries.
See Note 9 to the Consolidated Financial Statements for financial information regarding business segments and 10% customers. A&D The A&D segment accounted for approximately 44%, 41% and 41% of our total revenue in 2024, 2023 and 2022, respectively. This segment has nine facilities in the United States and one in Mexico.
Products Our principal products are described below. See Note 10 to the Consolidated Financial Statements for financial information regarding business segments and 10% customers. A&D The A&D segment accounted for approximately 44%, 37% and 34% of our total revenue from continuing operations in 2025, 2024 and 2023, respectively.
(Crissair) Mayday Manufacturing Co. (Mayday) Globe Composite Solutions, LLC (Globe, including Westland Technologies, Inc.) Utility Solutions Group (USG): Doble Engineering Company Morgan Schaffer Ltd. (Morgan Schaffer) I.S.A. – Altanova Group S.r.l. and affiliates (Altanova) NRG Systems, Inc.
(MSI) and PMES I Limited (all acquired April 25, 2025) Utility Solutions Group (USG): Doble Engineering Company Morgan Schaffer Ltd. (Morgan Schaffer) I.S.A. – Altanova Group S.r.l. and affiliates (Altanova) NRG Systems, Inc.
(NRG) Except as the context otherwise indicates, the term “Doble” as used herein includes Doble Engineering Company and ESCO’s other USG subsidiaries except NRG. RF Test & Measurement (Test): ETS-Lindgren Inc. MPE Limited (MPE) Except as the context otherwise indicates, the term “ETS-Lindgren” as used herein includes ETS-Lindgren Inc. and ESCO’s other Test segment subsidiaries.
(NRG) Except as the context may otherwise indicate, the term “Doble” as used herein includes Doble Engineering Company, Morgan Schaffer, Altanova and ESCO’s other USG subsidiaries except NRG.
We had a significantly high response rate of 75% and overall engagement favorability of 81%, exceeding comparable benchmarks. The insights gained from the survey have informed leader actions to build on strengths and address areas of opportunity. Periodic engagement surveys will help measure progress against those actions. Fewer than 3% of our workforce are contingent workers.
The response rate for this survey was 74% and overall global engagement continues to exceed comparable benchmarks, increasing by two points to 83%. The insights gained from the survey have informed actions to build on strengths and address areas of opportunity. Periodic engagement surveys will help measure progress against those actions.
Government, primarily related to the A&D segment, accounted for approximately 27%, 23% and 25% of our total revenue in 2024, 2023 and 2022, respectively. Our Government contracts primarily include firm fixed-price contracts under which work is performed and paid for at a fixed amount without adjustment for the actual costs experienced in connection with the contracts.
Our Government contracts include both cost-plus contracts, under which we are entitled to receive a specified amount or percentage over and above our actual costs of performance, and fixed-price contracts under which our work is performed and paid for at a fixed amount without adjustment for the actual costs experienced in connection with the contracts.
We recognize that our success is based on the talents and dedication of those we employ, and we are invested in their success. We make significant investments in the areas of talent development, technical skills and compliance training in areas such as supervisor training, professional coaching, ethics, safety, hazmat, ITAR, etc.
We make significant investments in the areas of talent development, technical skills and compliance training in areas such as supervisor training, professional coaching, ethics, safety, hazmat, ITAR, etc. For succession planning purposes, we focus on identifying high-potential future leaders and working with them on individual development plans and coaching.
Table of Contents Our operating subsidiaries are engaged primarily in the research, development, manufacture, sale and support of the products and systems described below.
RF Test & Measurement (Test): ETS-Lindgren, which except as the context may otherwise indicate, includes ETS-Lindgren Inc., MPE Limited (MPE) and ESCO’s other Test segment subsidiaries Our operating subsidiaries are engaged primarily in the research, development, manufacture, sale and support of the products and systems described below.
Information about these acquired businesses is provided in the following section, “Products,” and in Note 2 to the Consolidated Financial Statements.
CMT is a leading supplier of syntactic materials for buoyancy and specialty applications, with expertise in designing and manufacturing custom syntactic foam components and systems utilized in industrial, oceanographic, military, and naval applications. Information about these acquired businesses is provided in the following section, “Products,” and in Note 2 to the Consolidated Financial Statements.
Navy maritime survivability; and miniature electro-explosive devices for military aircraft ejection seats and missile arming devices. USG Our USG segment accounted for approximately 36%, 36% and 32% of our total revenue in 2024, 2023 and 2022, respectively. This segment has eight facilities in the United States, one in Canada, and ten outside North America.
USG Our USG segment accounted for approximately 35%, 40% and 40% of our total revenue from continuing operations in 2025, 2024 and 2023, respectively. This segment has eight facilities in the United States, one in Canada, and ten outside North America. The segment’s operations consist primarily of Doble Engineering Company, Morgan Schaffer and Altanova (collectively, Doble), and NRG.
We provide and maintain a work environment that attracts, develops and retains top talent by offering our employees an engaging work experience that contributes to their career development. Through our charitable Foundation we provide opportunities for civic involvement that supports our communities and provides our employees with meaningful experiences that promote collaborative and rewarding work environments.
We strive to be a responsible member of the communities in which we operate, and we are dedicated to preserving operational excellence and remaining an employer of choice. We provide and maintain a work environment that attracts, develops and retains top talent by offering our employees an engaging work experience that contributes to their career development.
Human Capital Management As of September 30, 2024, we employed 3,281 persons, including 3,242 full time employees 20% of whom were located in 19 foreign countries. We strive to be a responsible member of the communities in which we operate, and we are dedicated to preserving operational excellence and remaining an employer of choice.
Human Capital Management As of September 30, 2025, we employed 3,425 persons, including 3,359 full time employees, 28% of whom were located in 16 offices outside the U.S.A. Our employees are our greatest strength and are critical to the achievement of our vision and successful execution of our global business strategy.
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For example, in FY2023 we consolidated the businesses of Westland Technologies and Globe Composites into a single business managed by the Globe leadership team in Stoughton, MA, and repurposed Westland’s Modesto, California location into a focused manufacturing site in support of our broader Navy materials business.
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(Crissair) Globe Composite Solutions, LLC (Globe), which except as the context may otherwise indicate, also includes Westland Technologies, Inc. (Westland) Mayday Manufacturing Co. (Mayday) ESCO Maritime Solutions (Maritime), which except as the context may otherwise indicate, includes ESCO Maritime Solutions, Ltd., DNE Technologies, Inc. (DNE), EMS Development Corporation (EMS), Measurement Systems, Inc.
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CMT is a leading supplier of syntactic materials for buoyancy and specialty applications, with expertise in designing and manufacturing custom syntactic foam components and systems utilized in industrial, oceanographic, military, and naval applications. In November 2021, we acquired Networks Electronic Company, LLC (NEco). NEco, based in Chatsworth, California, provides miniature electro-explosive devices utilized in mission-critical defense and aerospace applications.
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Our Company-wide “ESCO Operating System” initiative, begun in 2025, has already produced numerous velocity and cost improvements. We also continue to seek opportunities to supplement our growth by making strategic acquisitions.
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As previously announced in July 2024, we have entered into a Sale and Purchase Agreement (“Purchase Agreement”) with Ultra Electronics Holdings Limited, a private limited liability company incorporated in England & Wales (“Ultra”), pursuant to which one or more wholly owned subsidiaries of the Company will acquire from Ultra or its subsidiaries Ultra’s Signature Management & Power (“SM&P”) business, including all of the issued and outstanding equity interests of (i) Ultra PMES Limited, a private limited liability company incorporated in England & Wales, (ii) Measurement Systems, Inc., a Delaware corporation, (iii) EMS Development Corporation, a New York corporation, and (iv) DNE Technologies, Inc., a Delaware corporation, for a total purchase price of approximately $550 million, plus or minus certain customary adjustments at closing and post-closing for cash, debt, working capital and transaction expenses as specified in the Purchase Agreement (the “SM&P Acquisition”).
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In April 2025, we acquired the Signature Management & Power (“SM&P”) business of Ultra Electronics Holdings Limited, comprising Ultra PMES Limited (subsequently renamed as PMES I Limited), a private limited company incorporated in England and Wales, Measurement Systems, Inc., a Delaware corporation, EMS Development Corporation, a New York corporation, and DNE Technologies, Inc., a Delaware corporation.
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Although we have secured adequate financing for the SM&P Acquisition and the waiting period under the Hart-Scott-Rodino Act expired in August 2024, closing of the SM&P Acquisition remains subject to certain other conditions including the receipt of clearance under the United Kingdom’s National Security and Investment Act of 2021 (the “NSIA”).
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The SM&P business, which we now refer to as ESCO Maritime Solutions or Maritime, includes Signature Management products, providing solutions for surface ships and submarines that provide magnetic and electric field countermeasures to prevent underwater mine and sensor detection, and Power Management products, providing innovative and highly-engineered motors that drive critical ship propulsion systems with an ultra-quiet design ensuring low vibration levels to increase stealth capabilities; both of these product lines are highly complementary to our current naval programs.
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We submitted our filing for clearance under the NSIA in July 2024 and the UK government is assessing the SM&P Acquisition. We are optimistic that the assessment will be positively resolved and the required clearance will be obtained.
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This segment has nine facilities in the United States, two in the United Kingdom, and one in Mexico. Throughout 2025, the segment’s operations consisted of PTI, Crissair, Globe, Mayday and Maritime (acquired in April).
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The closing of the SM&P Acquisition will occur at a date mutually agreed between the Company and Ultra following the satisfaction of conditions to closing, with closing currently expected to occur in the second quarter of fiscal 2025.
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VACCO is reflected as discontinued operations in the Consolidated Financial Statements and related notes for all periods shown in this Annual Report. For more information about the VACCO divestiture, see Note 3 to the Consolidated Financial Statements.
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See Item 1A, “Risk Factors.” In addition, as previously announced in August 2024, we are currently engaged in a strategic review of our Space business at VACCO. The results of this review could include, among other alternatives, a sale of VACCO or its Space business. The intent is to optimize our portfolio of businesses and create value for ESCO shareholders.
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Morgan Schaffer designs, develops, manufactures and markets an integrated offering of dissolved gas analysis, oil testing and data management solutions which enhance the ability of electric utilities to accurately monitor the health of critical power transformers.
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The segment’s operations consist of PTI, VACCO, Crissair, Mayday and Globe.
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The Altanova acquisition has provided a significant international platform for Doble by representing our products and solutions in markets outside North and South America including Canada.
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We pride ourselves on maintaining a diverse, inclusive and safe work environment to inspire our employees to give their best efforts every day. In fact, over half of our employee base comes from demographically diverse backgrounds.
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Government, primarily related to the A&D segment, accounted for approximately 23%, 20% and 17% of our total revenue from continuing operations in 2025, 2024 and 2023, respectively.
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For succession planning purposes, we focus on identifying high-potential future leaders and working with them on individual development plans and coaching. 6 Table of Contents Attracting and retaining a talented workforce is of utmost importance.
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All of our facilities are in material compliance with appliable Government regulations and executive orders.
Removed
Workforce Composition (As of September 30, 2024) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ By Gender ​ By Race Male 69 % ​ Minorities 41 % Female 24 % ​ White 37 % Unknown* 7 % ​ Unknown* 22 % ​ ​ ​ ​ ​ By Generation Gen Z (1996-2015) 13 % Millennials (1977-1995) 40 % Gen X (1965-1976) 27 % Boomers (1946-1964) 20 % Silent (1945 & before) % ​ Minorities are defined to include individuals of Native American or Alaskan Native, Asian, Black or African American, Hispanic or Latino, Native Hawaiian or Other Pacific Islander, and Two or More Races. ​ The above is based on employees’ self-identification or other information believed by the Company to be reliable. *Some countries do not permit the collection or reporting of some or all of the above types of data.
Added
In addition, Globe has developed significant manufacturing and logistics capability utilized for special hull treatments for submarines, and Maritime produces technologically differentiated solutions for demanding applications across Naval defense, with intellectual property generated and retained in key design, engineering and manufacturing processes.
Removed
Financing For information about our credit facility, see Note 6 to the Consolidated Financial Statements, which is incorporated into this Item by reference.
Added
In 2025, ETS-Lindgren purchased a portfolio of intellectual properties consisting of domestic and foreign patents and supporting assets covering the Model 3170 Intell-I-Tune Antenna, a tunable antenna designed for high-power testing in defense, aerospace and select automotive applications and capable of meeting a specific proposed Department of Defense testing standard.
Added
Through our charitable Foundation, we provide opportunities for civic involvement that support our communities and provide our employees with meaningful experiences that promote collaborative and rewarding work environments. Our CORE values are Integrity, Teamwork, Customer Service, Safety, Innovation and Quality. Safety is a core value at ESCO Technologies.
Added
We are committed to achieving zero workplace injuries and maintain continuous oversight of key safety indicators, including recordable incidents, restricted duty and lost time cases, workers’ compensation claims, and injury rates. All incidents are investigated to determine root causes, and corrective actions are implemented and shared company-wide to prevent recurrence.
Added
This year we launched the Leadership Education and Development Program (LEAD), a key leadership initiative created to foster meaningful connections and support professional growth across ESCO. The LEAD Program spans twelve months and includes an inaugural cohort of ten participants from across our subsidiaries, launched in April 2025. Attracting and retaining a talented workforce is of utmost importance.
Added
There are no family relationships among any of our executive officers and directors. ​ ​ 8 Table of Contents

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

27 edited+2 added−5 removed54 unchanged
Biggest changeAs a result, we are subject to the risks of doing business internationally, including: ● Changes in regulatory requirements or other executive branch actions, such as Executive Orders; ● Changes in the global trade environment, including disputes with authorities in non-U.S. jurisdictions, including international trade authorities, that could impact sales and/or delivery of products and services outside the U.S. and/or impose costs on our customers in the form of tariffs, duties or penalties attributable to the importation of our products; ● Trade restrictions against certain foreign-made products or entities may adversely affect our business and our ability to compete in certain markets; ● Our business may also be impacted by the ongoing trade tensions between the U.S. and China which are causing U.S. goods to be viewed in a less favorable light by Chinese customers; ● Changes to U.S. and non-U.S. government policies, including sourcing restrictions, requirements to expend a portion of program funds locally and governmental industrial cooperation or participation requirements; ● Fluctuations in international currency exchange rates; 9 Table of Contents ● Volatility in international political and economic environments and changes in non-U.S. national priorities and budgets, which can lead to delays or fluctuations in orders; ● Imposition of domestic and international taxes, export controls, tariffs, embargoes, sanctions (such as those imposed on Russia and Iran) and other trade restrictions; ● Compliance with a variety of non-U.S. laws, as well as U.S. laws affecting the activities of U.S. companies abroad; and ● Unforeseen developments and conditions, including terrorism, war, epidemics and international tensions and conflicts.
Biggest changeAs a result, we are subject to the risks of doing business internationally, including: ● Executive branch actions such as the imposition of tariffs on imports of component parts or raw materials exceeding our ability to pass them along to our customers, or changes in regulatory requirements; ● Other changes in the global trade environment, including disputes with authorities in non-U.S. jurisdictions, including international trade authorities, that could impact sales and/or delivery of products and services outside the U.S. and/or impose costs on our customers in the form of import duties or penalties attributable to the importation of our products; ● Trade restrictions against certain foreign-made products or entities may adversely affect our business and our ability to compete in certain markets; ● Ongoing trade tensions between the U.S. and other countries including China as well as traditional trading partners such as Canada and the E.U., which involve restrictions on the availability of raw materials or cause U.S. goods to be viewed in a less favorable light by non-U.S. customers; ● Changes to U.S. and non-U.S. government policies, including sourcing restrictions, requirements to expend a portion of program funds locally and governmental industrial cooperation or participation requirements; ● Future decisions of the UK Government which might significantly reduce funding for its naval programs; ● Fluctuations in international currency exchange rates; ● Volatility in international political and economic environments and changes in non-U.S. national priorities and budgets, which can lead to delays or fluctuations in orders; ● Imposition of domestic and international taxes, export controls, tariffs, embargoes, sanctions (such as those imposed on Russia and Iran) and other trade restrictions; ● Compliance with a variety of non-U.S. laws, as well as U.S. laws affecting the activities of U.S. companies abroad; and ● Unforeseen developments and conditions, including terrorism, war, epidemics and international tensions and conflicts.
For example, a substantial portion of PTI's revenue is generated from commercial aviation aftermarket sales. As certain aircraft are retired and replaced by newer aircraft, if we were unable to offer suitable products for the newer aircraft there could be a corresponding decrease in sales associated with our products which could adversely affect our operating results.
For example, a substantial portion of PTI’s revenue is generated from commercial aviation aftermarket sales. As certain aircraft are retired and replaced by newer aircraft, if we are unable to offer suitable products for the newer aircraft there could be a corresponding decrease in sales associated with our products which could adversely affect our operating results.
In addition, some of these regulations may be viewed as too restrictive by our international customers, who may elect to develop their own domestic products or procure products from other international suppliers which are not subject to comparable export restrictions; and the laws, regulations or policies of certain other countries may also favor their own domestic suppliers over foreign suppliers such as the Company. 10 Table of Contents Risks Related to our Manufacturing and Sales Operations and Technology Cybersecurity Incidents and Related Data Breaches or Other Disruptions of Our Information Technology Systems Could Adversely Affect Our Business.
In addition, some of these regulations may be viewed as too restrictive by our international customers, who may elect to develop their own domestic products or procure products from other international suppliers which are not subject to comparable export restrictions; and the laws, regulations or policies of certain other countries may also favor their own domestic suppliers over foreign suppliers such as the Company. 11 Table of Contents Risks Related to our Manufacturing and Sales Operations and Technology Cybersecurity Incidents and Related Data Breaches or Other Disruptions of Our Information Technology Systems Could Adversely Affect Our Business.
For example: ● Our Test segment does significant business in Asia, and changes in the Chinese political climate, or economic or territorial aggression by China against Taiwan or other nearby countries, could significantly and negatively affect our business; also, cash generated by our business in China may not be available to fund our operations or other uses outside China due to possible imposition of restrictions or limitations on our ability to repatriate the cash, and although we attempt to repatriate cash on a regular basis to mitigate this risk, we may not be able to continue to do this in the future; ● Several of our subsidiaries are based in Europe and could be negatively impacted by the ongoing conflicts between Russia and Ukraine, between Israel and Hamas in Gaza and Lebanon, or between Israel and Iran; if any of these conflicts were to expand in scope or spread beyond these countries, or if other conflicts were to develop, we would expect an increasingly unfavorable impact on our global business environment; and ● Our international sales are also subject to other risks inherent in foreign commerce, including currency fluctuations and devaluations, differences in foreign laws, uncertainties as to enforcement of contract or intellectual property rights, and difficulties in negotiating and resolving disputes with our foreign customers.
For example: ● Our Test segment does significant business in Asia, and changes in the Chinese political climate, or economic or territorial aggression by China against Taiwan or other nearby countries, could significantly and negatively affect our business; also, cash generated by our business in China may not be available to fund our operations or other uses outside China due to possible imposition of restrictions or limitations on our ability to repatriate the cash, and although we repatriate cash on a regular basis to mitigate this risk, we may not be able to continue to do this in the future; 10 Table of Contents ● Several of our subsidiaries are based in Europe and could be negatively impacted by the ongoing conflicts between Russia and Ukraine, between Israel and Hamas in Gaza and Lebanon, or between Israel and Iran; if any of these conflicts were to expand in scope or spread beyond these countries, or if other conflicts were to develop, we would expect an increasingly unfavorable impact on our global business environment; and ● Our international sales are also subject to other risks inherent in foreign commerce, including currency fluctuations and devaluations, differences in foreign laws, uncertainties as to enforcement of contract or intellectual property rights, and difficulties in negotiating and resolving disputes with our foreign customers.
We are currently involved as a responsible party in several ongoing investigations and remediations of contaminated third-party owned properties. In addition, environmental contamination may be discovered in the future on properties which we formerly owned or operated and for which we could be legally responsible.
We have been and are currently involved as a responsible party in several ongoing investigations and remediations of contaminated third-party owned properties. In addition, environmental contamination may be discovered in the future on properties which we formerly owned or operated and for which we could be legally responsible.
In addition, some of our customers or potential customers may prefer to purchase from a supplier which does not have such a limited number of sources of supply. Increases in prices of raw material and components, and decreased availability of such items, could adversely affect our business.
In addition, some of our customers or potential customers may prefer to purchase from a supplier which does not have such a limited number of sources of supply. 12 Table of Contents Increases in prices of raw material and components, and decreased availability of such items, could adversely affect our business.
Increases in the prices of raw materials (such as steel, copper, nickel, zinc, wood and petrochemical products) could have an adverse impact on our business by, among other things, increasing costs and reducing margins.
Import tariffs or other increases in the prices of raw materials (such as steel, copper, nickel, zinc, wood and petrochemical products) could have an adverse impact on our business by, among other things, increasing costs and reducing margins.
Any or all of these actions may divert our resources and cause us to incur substantial costs. 12 Table of Contents Environmental laws and regulations or environmental contamination could increase our expenses and adversely affect our profitability.
Any or all of these actions may divert our resources and cause us to incur substantial costs. Environmental laws and regulations or environmental contamination could increase our expenses and adversely affect our profitability.
As another example, Globe has a single supplier of critical materials for a significant military production program, and if this supplier were to discontinue producing these components in a timely manner the need to secure another source could pose a risk to the production program.
As another example, Globe has a single supplier of critical materials for a significant military production program, and if this supplier were to discontinue producing these components in a timely manner the need to secure another source could pose a risk to or at least a significant delay in the production program.
Our articles of incorporation and bylaws contain certain provisions which could discourage potential hostile takeover attempts, including: a limitation on the shareholders’ ability to call special meetings of shareholders; advance notice requirements to nominate candidates for election as directors or to propose matters for action at a meeting of shareholders; a classified board of directors, which means that approximately one-third of our directors are elected each year; and the authority of our board of directors to issue, without shareholder approval, preferred stock with such terms as the board may determine.
Our articles of incorporation and bylaws contain certain provisions which could make us less attractive to prospective investors or discourage potential takeover attempts, including a limitation on the shareholders’ ability to call special meetings of shareholders; advance notice requirements to nominate candidates for election as directors or to propose matters for action at a meeting of shareholders; a classified board of directors, which means that only approximately one-third of our directors are elected each year; and the authority of our board of directors to issue, without shareholder approval, preferred stock with such terms as the board may determine.
In addition, these disputes could result in a reduction in revenue, a loss on a particular project, or even a significant damages award against us. Despite our efforts, we may be unable to adequately protect our intellectual property.
In addition, these disputes could result in a reduction in revenue, a loss on a particular project, or even a significant damages award against us. 13 Table of Contents Despite our efforts, we may be unable to adequately protect our intellectual property.
These provisions could impede a merger or other change of control not approved by our board of directors, which could discourage takeover attempts and in some circumstances reduce the market price of our common stock. ​
These provisions could reduce major shareholders’ influence over corporate policy or impede a merger or other change of control not approved by our board of directors, which could discourage investors and in some circumstances reduce the market price of our common stock. ​
Although losses arising from some of these issues may be covered by information security insurance, we cannot guarantee that our coverage will be adequate for all costs or losses incurred. See Item 1C, Cybersecurity, for information on our cybersecurity risk management, strategy and governance. A significant part of our manufacturing operations depends on a small number of third-party suppliers.
Although we maintain insurance coverage for data privacy risks, we cannot guarantee that our coverage will be adequate for all costs or losses incurred. See Item 1C, Cybersecurity, for information on our cybersecurity risk management, strategy and governance. A significant part of our manufacturing operations depends on a small number of third-party suppliers.
Government defense spending or changes in acquisition priorities could negatively impact our financial position and result of operations. Sales to the U.S. Government and its prime contractors and subcontractors represent a significant portion of our business. In 2024, approximately 27% of our revenues have been generated from sales to the U.S. Government or its contractors, primarily within our A&D segment.
Government defense spending or changes in acquisition priorities could negatively impact our financial position and result of operations. Sales to the U.S. Government and its prime contractors and subcontractors represent a significant portion of our business. In 2025, approximately 23% of our revenues from continuing operations were generated from sales to the U.S.
In addition, acquisitions of other companies, including but not limited to those encompassed in the SM&P Acquisition, involve numerous risks, including unexpected or unavoidable delays in consummation, possible failure to satisfy preconditions to closing or comply with post-closing terms, difficulties in the integration of the operations, technologies and products of the acquired companies, the potential exposure to unanticipated and undisclosed liabilities, the potential that expected benefits or synergies are not realized and that operating costs increase, the potential loss of key personnel, suppliers or customers of acquired businesses and the diversion of Management’s time and attention from other business concerns.
As a result, we may be limited in the number of acquisitions which we are able to complete, and we may face difficulties in achieving the profitability or cash flows needed to justify our investment in them. 14 Table of Contents In addition, acquisitions of other companies, including but not limited to those encompassed in the Maritime acquisition, involve numerous risks, including unexpected or unavoidable delays in consummation, possible failure to satisfy preconditions to closing or comply with post-closing terms, difficulties in the integration of the operations, technologies and products of the acquired companies, the potential exposure to unanticipated and undisclosed liabilities, the potential that expected benefits or synergies are not realized and that operating costs increase, the potential loss of key personnel, suppliers or customers of acquired businesses and the diversion of Management’s time and attention from other business concerns.
Provisions in our articles of incorporation, bylaws and Missouri law could make it more difficult for a third party to acquire us and could discourage acquisition bids or a change of control, and could adversely affect the market price of our common stock.
Provisions in our articles of incorporation, bylaws and Missouri corporate laws could make us less attractive to investors or make it more difficult for a third party to acquire us, and could thereby adversely affect the market price of our common stock.
Aerospace-grade titanium and gaseous helium, important raw materials for our A&D segment, may at times be in short supply; in addition, although we try to tie our supplier pricing to long-term contracts this is not always 11 Table of Contents possible, and we are experiencing price inflation on a number of products.
Aerospace-grade titanium, an important raw material for our A&D segment, may at times be in short supply; in addition, although we try to tie our supplier pricing to long-term contracts this is not always possible.
We expect that non-U.S. sales will continue to account for a significant portion of our revenues for the foreseeable future.
In 2025, approximately 34% of our net sales from continuing operations were to customers outside the United States. We expect that non-U.S. sales will continue to account for a significant portion of our revenues for the foreseeable future.
Despite our active recruitment efforts, there remains a shortage of these qualified engineers and other employees because of hiring competition 13 Table of Contents from other companies in the industry and a generally tight labor market.
Despite our active recruitment efforts, there remains a shortage of these qualified engineers and other employees because of hiring competition from other companies in the industry and a generally tight labor market. Losing current employees or qualified candidates to other employers or for other reasons could reduce our ability to provide services and negatively affect our revenues.
These sales are dependent on government funding of the underlying programs, which is generally subject to annual Congressional appropriations and periodic authorization of increases in the Government debt ceiling, and they may therefore be adversely affected not only by failure to obtain timely and adequate appropriations but also by extended Government shutdowns or by changes in priorities following the 2025 change in the Administration. 8 Table of Contents The lack of certainty about long-term Government defense spending priorities and Congressional willingness to continue short-term Governmental funding in a timely manner creates a continuing risk of reductions or terminations of, or delays in, the government funding of programs applicable to us or our customers, which we cannot anticipate.
These sales are dependent on government funding of the underlying programs, which is generally subject to annual Congressional appropriations and periodic authorization of increases in the Government debt ceiling, and they may therefore be adversely affected not only by failure to obtain timely and adequate appropriations but also by extended Government shutdowns or by changes in Government spending priorities.
These funding effects could adversely affect our financial condition or results of operations. A significant portion of VACCO’s, Globe’s and Westland’s sales involve major U.S. Government programs such as NASA’s Space Launch System (SLS) and U.S. Navy submarines.
These funding effects could adversely affect our financial condition or results of operations. A significant portion of Globe’s and Westland’s sales involve major U.S. Government programs such as U.S. Navy submarines. A reduction or delay in Government spending on these programs could have a significant adverse impact on our financial results which could extend for more than a single year.
These systems are used to obtain, process, transmit and store electronic information and to manage or support a variety of integral business processes and activities.
We have many information technology systems that are important to the operation of our businesses, some of which are managed by third parties. These systems are used to obtain, process, transmit and store electronic information and to manage or support a variety of integral business processes and activities.
In addition, technical or quality issues that arise during development could lead to schedule delays and higher costs to complete, which could result in a material charge or otherwise adversely affect our financial condition.
In addition, technical or quality issues that arise during development could lead to schedule delays and higher costs to complete, which could result in a material charge or otherwise adversely affect our financial condition. 9 Table of Contents Risks Related to our International Business We derive a significant part of our revenues from non-U.S. sales and are subject to the risks of doing business in other countries.
We enter into fixed-price contracts which could subject us to losses if we have cost overruns. We derive some of our revenues from fixed-price contracts.
Government’s and its subcontractors’ ability to modify or terminate major programs or contracts, and if and to the extent that this occurs, our future revenues could be materially reduced. We enter into fixed-price contracts which could subject us to losses if we have cost overruns. We derive some of our revenues from fixed-price contracts.
Losing current employees or qualified candidates to other employers or for other reasons could reduce our ability to provide services and negatively affect our revenues. Our decentralized organizational structure presents certain risks. We are a relatively decentralized company in comparison with some of our peers.
Our decentralized organizational structure presents certain risks. We are a relatively decentralized company in comparison with some of our peers.
Although we maintain insurance coverage for data privacy risks, we cannot guarantee that our coverage will be adequate for all costs or losses incurred. We have many information technology systems that are important to the operation of our businesses, some of which are managed by third parties.
Although losses arising from some of these issues may be covered by information security insurance, we cannot guarantee that our coverage will be adequate for all costs or losses incurred.
There can be no assurance that our customers will purchase all the orders represented in our backlog, particularly as to contracts which are subject to the U.S. Government’s and its subcontractors’ ability to modify or terminate major programs or contracts, and if and to the extent that this occurs, our future revenues could be materially reduced.
As of September 30, 2025, our twelve-month backlog was approximately $722 million, which represents confirmed orders we believe will be recognized as revenue within the next twelve months. There can be no assurance that our customers will purchase all the orders represented in our backlog, particularly as to contracts which are subject to the U.S.
Removed
A reduction or delay in Government spending on these programs could have a significant adverse impact on our financial results which could extend for more than a single year. As of September 30, 2024, our twelve-month backlog was approximately $608 million, which represents confirmed orders we believe will be recognized as revenue within the next twelve months.
Added
Government or its contractors, primarily within our A&D segment.
Removed
Risks Related to our International Business We derive a significant part of our revenues from non-U.S. sales and are subject to the risks of doing business in other countries. In 2024, approximately 28% of our net sales were to customers outside the United States.
Added
The lack of certainty about long-term Government defense spending priorities and Congressional willingness to continue short-term Governmental funding in a timely manner creates a continuing risk of reductions or terminations of, or delays in, the government funding of programs applicable to us or our customers, which we cannot anticipate.
Removed
Further, some of Doble’s items of equipment which are provided to its customers for their use are in the maturity of their life cycles, which creates the risk that replacement components may be unavailable or available only at increased costs.
Removed
We have experienced COVID-related short-term disruptions in the supply chain which have periodically resulted in extended lead times and cost increases, and the long term impacts of these disruptions are uncertain.
Removed
As a result, we may be limited in the number of acquisitions which we are able to complete, and we may face difficulties in achieving the profitability or cash flows needed to justify our investment in them.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

2 edited+0 added−0 removed6 unchanged
Biggest changeFor more information about the cybersecurity risks we face, see Item 1A, “Risk Factors.” 14 Table of Contents Cybersecurity Governance Our cybersecurity program is managed by a global internal team that addresses potential risks, implements processes to support our cybersecurity program and responds to potential cyber incidents.
Biggest changeFor more information about the cybersecurity risks we face, see Item 1A, “Risk Factors.” Cybersecurity Governance Our cybersecurity program is managed by a global internal team that addresses potential risks, implements processes to support our cybersecurity program and responds to potential cyber incidents.
The team has decades of experience with varied certifications and includes our Senior Director of IT who has over 20 years of experience as an IT professional engaged in network architecture and cybersecurity. The internal team is supported by third party providers to expand coverage, expertise and responsiveness.
The team has decades of experience with varied certifications and includes our Senior Director of IT who has over 25 years of experience as an IT professional engaged in network cybersecurity. The internal team is supported by third party providers to expand coverage, expertise and responsiveness.

Item 2. Properties

Properties — owned and leased real estate

6 edited+0 added−1 removed0 unchanged
Biggest changeFt. ​ Expiration Date) ​ O=Office) ​ Segment Modesto, CA ​ 181,500 ​ Leased (9/30/2033) ​ M, E, W, O ​ A&D Stoughton, MA ​ 151,100 ​ Leased (1/31/2037) ​ M, E, W, O ​ A&D Denton, TX ​ 145,000 ​ Leased (9/30/2029, plus options) ​ M, E, W, O ​ A&D Cedar Park, TX 130,000 Owned M, E, W, O Test Oxnard, CA 127,400 Owned M, E, W, O A&D South El Monte, CA 100,100 Owned M, E, W, O A&D Durant, OK 100,000 Owned M, W, O Test Valencia, CA 79,300 Owned M, E, O A&D Marlborough, MA 79,100 Leased (2/28/2037) M, E, W, O USG Hinesburg, VT 77,000 Owned M, E, W, O USG Accident, MD 66,800 Owned M, E, W, O USG South El Monte, CA 52,700 Leased (12/31/2024) M, W, O A&D Liverpool, England 42,000 Owned M, E, W, O Test Eura, Finland ​ 41,500 ​ Owned ​ M, E, W, O ​ Test Montreal, Québec 38,400 Leased (8/31/2041) M, E, W, O USG Tianjin, China ​ 38,100 ​ Leased (11/19/2027) ​ M, E, O ​ Test Minocqua, WI 35,400 Owned M, W ,O Test Bologna, Italy 28,200 Leased (8/13/2028) M, E, W ,O USG Cedar Park, TX ​ 28,000 ​ Leased (8/31/2028) ​ M.
Biggest changeFt. ​ Expiration Date) ​ O=Office) ​ Segment Modesto, CA ​ 181,500 ​ Leased (9/30/2033) ​ M, E, W, O ​ A&D Stoughton, MA ​ 163,300 ​ Leased (11/30/2037) ​ M, E, W, O ​ A&D Denton, TX ​ 145,000 ​ Leased (9/30/2029, plus options) ​ M, E, W, O ​ A&D Cedar Park, TX 130,000 Owned M, E, W, O Test Oxnard, CA 127,400 Owned M, E, W, O A&D Durant, OK 100,000 Owned M, W, O Test Valencia, CA 79,300 Owned M, E, O A&D Marlborough, MA 79,100 Leased (2/28/2037) M, E, W, O USG Hinesburg, VT 77,000 Owned M, E, W, O USG Yaphank, NY ​ 67,000 ​ Leased (8/31/2028) ​ M, E, W, O ​ A&D Accident, MD 66,800 Owned M, E, W, O USG Liverpool, England 42,000 Owned M, E, W, O Test Eura, Finland ​ 41,500 ​ Owned ​ M, E, W, O ​ Test Wallingford, CT ​ 40,600 ​ Leased (6/30/2030) ​ M, E, W, O ​ A&D Rugeley, England ​ 62,000 ​ Owned ​ M, E, W, O ​ A&D Montreal, Québec 38,400 Leased (8/31/2041) M, E, W, O USG Tianjin, China ​ 72,000 ​ Leased (various) ​ M, E, O ​ Test Minocqua, WI 35,400 Owned M, W, O Test Bologna, Italy 28,200 Leased (8/13/2028) M, E, W, O USG Cedar Park, TX ​ 28,000 ​ Leased (2/28/2029) ​ M.
W ​ Test Ontario, CA 26,900 Leased (8/31/2025) M, E, W ,O USG Chatsworth, CA 24,800 Leased (12/31/2025) M, E, W ,O A&D St.
W ​ Test Ontario, CA 26,900 Leased (8/31/2030) M, E, W, O USG Chatsworth, CA 24,800 Leased (12/31/2025) M, E, W, O A&D St.
See also Note 11 to the Consolidated Financial Statements. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal Use(s) ​ ​ ​ ​ ​ ​ ​ (M=Manufacturing, ​ ​ ​ ​ ​ ​ ​ ​ E=Engineering, ​ ​ ​ ​ Approx. ​ Owned / Leased (with ​ W=Warehouse, ​ Operating Location ​ Sq.
See also Note 12 to the Consolidated Financial Statements. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal Use(s) ​ ​ ​ ​ ​ ​ ​ (M=Manufacturing, ​ ​ ​ ​ ​ ​ ​ ​ E=Engineering, ​ ​ ​ ​ Approx. ​ Owned / Leased (with ​ W=Warehouse, ​ Operating Location ​ Sq.
We do not believe any of the omitted properties, consisting primarily of office space, warehouse space and land held for possible future use, are individually or collectively material to our operations or business.
The table below includes our principal physical properties. We do not believe any of the omitted properties, consisting primarily of office space, warehouse space and land held for possible future use, are individually or collectively material to our operations or business.
Louis, MO ​ 21,500 ​ Leased (8/31/2025) ​ ESCO Corporate Office ​ Corporate Attleboro, MA 20,500 Leased (3/31/2025) M, E, W, O A&D Taino, Italy 18,000 Leased (various term ends) M, E, W ,O USG Bangalore, India ​ 17,000 ​ Leased (2/28/2031) ​ M, E, W, O ​ Test Zola Predosa, Italy 12,900 Leased (1/31/2029) M, E, W ,O USG Morrisville, NC 11,600 Leased (1/31/2027, plus options) O USG Wood Dale, IL 10,700 Leased (8/31/2029) E, O Test ​ ​ 15 Table of Contents
Louis, MO ​ 24,800 ​ Leased (12/31/2035) ​ O (ESCO Corporate HQ) ​ Corporate Attleboro, MA 20,500 Leased (6/30/2026) M, E, W, O A&D Taino, Italy 18,000 Leased (various term ends) M, E, W, O USG Bangalore, India ​ 17,000 ​ Leased (2/28/2031) ​ M, E, W, O ​ Test Zola Predosa, Italy 12,900 Leased (1/31/2029) M, E, W, O USG Morrisville, NC 11,600 Leased (1/31/2027, plus options) O USG Wood Dale, IL 10,700 Leased (8/31/2029) E, O Test ​ ​
Item 2. Properties We believe our buildings, machinery and equipment have been generally well maintained, are in good operating condition and are adequate for our current production requirements and other needs.
Properties We believe our buildings, machinery and equipment have been generally well maintained, are in good operating condition and are adequate for our current production requirements and other needs. 16 Table of Contents At September 30, 2025, our physical properties, including those described in the table below, comprised approximately 2,440,000 square feet, of which approximately 761,000 square feet were owned and approximately 1,679,000 square feet were leased.
Removed
At September 30, 2024, our physical properties, including those described in the table below, comprised approximately 2,319,000 square feet, of which approximately 799,500 square feet were owned and approximately 1,519,500 square feet were leased. The table below includes our principal physical properties.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+0 added−0 removed1 unchanged
Biggest changeThese figures assume that all dividends, if any, paid over the measurement period were reinvested, and that the starting values of each index and the investments in our common stock were $100 at the close of trading on September 30, 2019. 17 Table of Contents COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Among ESCO Technologies Inc., the Russell 2000 Index, and the S&P SmallCap 600 Industrials Index ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 9/30/19 9/30/20 9/30/21 9/30/22 9/30/23 9/30/24 ESCO Technologies Inc. ​ $ 100.00 ​ $ 101.77 ​ $ 97.60 ​ $ 93.39 ​ $ 133.29 ​ $ 165.10 Russell 2000 Index ​ 100.00 ​ 100.39 ​ 148.25 ​ 113.42 ​ 123.55 ​ 156.61 S&P SmallCap 600 Industrials Index ​ 100.00 ​ 94.09 ​ 137.98 ​ 119.49 ​ 154.61 ​ 207.57 ​ The stock price performance included in this graph is not necessarily indicative of future stock price performance. ​
Biggest changeThese figures assume that all dividends, if any, paid over the measurement period were reinvested, and that the starting values of each index and the investments in our common stock were $100 at the close of trading on September 30, 2020. 18 Table of Contents COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Among ESCO Technologies Inc., the Russell 2000 Index, and the S&P SmallCap 600 Industrials Index ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 9/30/20 9/30/21 9/30/22 9/30/23 9/30/24 9/30/25 ESCO Technologies Inc. ​ $ 100.00 ​ $ 95.91 ​ $ 91.77 ​ $ 130.97 ​ $ 162.23 ​ $ 266.11 Russell 2000 Index ​ 100.00 ​ 147.68 ​ 112.98 ​ 123.07 ​ 156.00 ​ 172.78 S&P SmallCap 600 Industrials Index ​ 100.00 ​ 146.65 ​ 126.99 ​ 164.32 ​ 220.60 ​ 251.75 ​ The stock price performance included in this graph is not necessarily indicative of future stock price performance. ​
Securities Authorized for Issuance Under Equity Compensation Plans. For information about securities authorized for issuance under our equity compensation plans, please refer to Item 12 of this Form 10-K and to Note 8 to the Consolidated Financial Statements. Performance Graph.
Securities Authorized for Issuance Under Equity Compensation Plans. For information about securities authorized for issuance under our equity compensation plans, please refer to Item 12 of this Form 10-K and to Note 9 to the Consolidated Financial Statements. Performance Graph.
The Company is a component of both the Russell 2000 index and the S&P SmallCap 600 Industrials index. The measurement period begins on September 30, 2019 and measures at each September 30 thereafter.
The Company is a component of both the Russell 2000 index and the S&P SmallCap 600 Industrials index. The measurement period begins on September 30, 2020 and measures at each September 30 thereafter.
Our common stock is listed on the New York Stock Exchange; its trading symbol is “ ESE ” . Company Purchases of Equity Securities. For information about our common stock repurchase programs, please refer to Note 7 to the Consolidated Financial Statements. The Company did not repurchase any shares during the fourth quarter of 2024.
Our common stock is listed on the New York Stock Exchange; its trading symbol is “ ESE ” . Company Purchases of Equity Securities. For information about our common stock repurchase programs, please refer to Note 8 to the Consolidated Financial Statements. The Company did not repurchase any shares during the fourth quarter of 2025.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Holders of Record . As of November 2, 2024, there were approximately 1,820 holders of record of our common stock. Price Range of Common Stock and Dividends.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Holders of Record . As of November 14, 2025, there were approximately 1,894 holders of record of our common stock. Price Range of Common Stock and Dividends.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

47 edited+20 added−13 removed33 unchanged
Biggest changeThe $26.8 million, or 7.8%, increase in net sales in 2024 as compared to 2023 was mainly due to an $18.9 million increase in net sales at Doble mainly due to higher shipments of condition monitoring products and service revenue partially offset by lower shipments of protection testing products, and a $7.9 million increase in net sales at NRG driven by higher shipments of solar products.
Biggest changeBy subsidiary, the $137.7 million increase in net sales in 2025 as compared to 2024 was due to an $8.1 million increase in net sales at PTI, a $13.3 million increase in net sales at Globe, a $19.6 million increase in net sales at Crissair, a $1.5 million increase in net sales at Mayday and a $95.2 million net sales contribution from the current year acquisition of Maritime. 21 Table of Contents USG The $10.9 million, or 3.0%, increase in net sales in 2025 as compared to 2024 was mainly due to a $17.8 million increase in net sales at Doble mainly due to higher shipments of offline and protection testing products and service revenue, partially offset by a $7.0 million decrease in net sales at NRG driven by lower shipments of solar and wind products due to renewables market weakness.
NRG designs and manufactures decision support tools for the renewable energy industry, primarily wind and solar. Test. ETS-Lindgren is an industry leader in providing its customers with the ability to identify, measure and control magnetic, electromagnetic and acoustic energy. We continue to operate with meaningful growth prospects in our primary served markets and with considerable financial flexibility.
NRG designs and manufactures decision support tools for the renewable energy industry, primarily wind and solar. Test. ETS-Lindgren is an industry leader in providing its customers with the ability to identify, measure and control magnetic and electromagnetic energy. We continue to operate with meaningful growth prospects in our primary served markets and with considerable financial flexibility.
Cash flow from operations and borrowings under the Credit Facility is expected to provide adequate resources to meet our capital requirements and operational needs both for the next 12 months and for the foreseeable future.
Cash flow from operations and borrowings under the Credit Facility and the Incremental Facility is expected to provide adequate resources to meet our capital requirements and operational needs both for the next 12 months and for the foreseeable future.
We review and update our estimates of costs quarterly or more frequently when circumstances significantly change, which can affect the profitability of our contracts. For contracts where revenue is recognized over time, we recognize changes in estimated contract revenues, costs and profits using the cumulative catch-up method of accounting.
We review and update our estimates of costs quarterly or more frequently when circumstances significantly change, which can affect the profitability of our contracts. 26 Table of Contents For contracts where revenue is recognized over time, we recognize changes in estimated contract revenues, costs and profits using the cumulative catch-up method of accounting.
Acquisitions Information regarding our acquisitions during 2024, 2023 and 2022 is set forth in Note 2 to the Consolidated Financial Statements, which Note is incorporated by reference herein.
Acquisitions Information regarding our acquisitions during 2025, 2024 and 2023 is set forth in Note 2 to the Consolidated Financial Statements, which Note is incorporated by reference herein.
We recognize anticipated losses on contracts in full in the period in which the losses become known. 25 Table of Contents The impact of adjustments in contract estimates on our operating earnings can be reflected in either revenue or operating costs and expenses.
We recognize anticipated losses on contracts in full in the period in which the losses become known. The impact of adjustments in contract estimates on our operating earnings can be reflected in either revenue or operating costs and expenses.
Approximately 52% of the A&D segment’s revenue (23% of consolidated revenue) is recognized over time as the products do not have an alternative use and either we have an enforceable right to payment for costs incurred plus a reasonable margin or the inventory is owned by the customer.
Approximately 48% of the A&D segment’s revenue (21% of consolidated revenue) is recognized over time as the products do not have an alternative use and either we have an enforceable right to payment for costs incurred plus a reasonable margin or the inventory is owned by the customer.
The remaining amortization expenses relate to other identifiable intangible assets (primarily software, patents and licenses), which are included in the respective segment’s operating results. The increase in amortization expense in 2024 as compared to 2023 was mainly due to an increase in amortization of capitalized software and amortization of intangible assets related to the MPE acquisition.
The remaining amortization expenses relate to other identifiable intangible assets (primarily software, patents and licenses), which are included in the respective segment’s operating results. The increase in amortization expense in 2025 as compared to 2024 was mainly due to an increase in amortization of intangible assets related to the Maritime acquisition.
Dividends During both 2024 and 2023 we paid a regular quarterly cash dividend at an annual rate of $0.32 per share, totaling $8.2 million and $8.3 million in 2024 and 2023, respectively. Off-Balance-Sheet Arrangements We had no off-balance-sheet arrangements outstanding at September 30, 2024. Share Repurchases During 2024, the Company repurchased approximately 80,500 shares for approximately $8.0 million.
Dividends During both 2025 and 2024 we paid a regular quarterly cash dividend at an annual rate of $0.32 per share, totaling $8.3 million and $8.2 million in 2025 and 2024, respectively. Off-Balance-Sheet Arrangements We had no off-balance-sheet arrangements outstanding at September 30, 2025. Share Repurchases The Company did not repurchase any shares during 2025.
Net cash used by financing activities was $0.8 million in 2024 and $78.3 million in 2023, primarily due to the increase in debt borrowings during 2024. Bank Credit Facility A description of our credit facility (the “Credit Facility”) is set forth in Note 6 to the Consolidated Financial Statements, which Note is incorporated by reference herein.
Net cash provided (used) by financing activities from continuing operations was $49.5 million in 2025 and $(0.8) million in 2024, primarily due to the increase in debt borrowings during 2025. Bank Credit Facility A description of our credit facility (the “Credit Facility”) is set forth in Note 7 to the Consolidated Financial Statements, which Note is incorporated by reference herein.
USG The $9.2 million, or 12.0%, increase in EBIT in 2024 as compared to 2023 was mainly due to leverage on higher sales volumes at Doble and NRG with a favorable product mix and price increases, partially offset by inflationary pressures and higher commissions related to increased sales.
USG The $8.8 million, or 10.2%, increase in EBIT in 2025 as compared to 2024 was mainly due to leverage on higher sales volumes at Doble with a favorable product mix and price increases, partially offset by lower sales at NRG and inflationary pressures.
Amortization of Intangible Assets Amortization of intangible assets was $32.8 million in 2024 and $29.0 million in 2023, including $20.7 million and $18.8 million of amortization of acquired intangible assets in 2024 and 2023, respectively, related to our acquisitions. The amortization of acquired intangible assets related to acquisitions is included in the Corporate segment’s results.
Amortization of Intangible Assets Amortization of intangible assets was $53.3 million in 2025 and $32.8 million in 2024, including $41.4 million and $20.7 million of amortization of acquired intangible assets in 2025 and 2024, respectively, related to our acquisitions. The amortization of acquired intangible assets related to acquisitions is included in the Corporate segment’s results.
Selected financial information for each of our business segments is provided in the discussion below and in Note 9 to the Company’s Consolidated Financial Statements. This section includes comparisons of certain 2024 financial information to the same information for 2023.
See Note 3 to the Consolidated Financial Statements for further discussion. Selected financial information for each of our business segments is provided in the discussion below and in Note 10 to the Company’s Consolidated Financial Statements. 19 Table of Contents This section includes comparisons of certain 2025 financial information to the same information for 2024.
The aggregate impact of adjustments in contract estimates decreased our earnings before income tax and diluted earnings per share by approximately $13 million and $0.38 per share, respectively, in 2024. Income Taxes We operate in numerous taxing jurisdictions and are subject to examination by various U.S. Federal, state and foreign jurisdictions for various tax periods.
The aggregate impact of adjustments in contract estimates increased our earnings after income tax from continuing operations and diluted earnings per share by approximately $2.6 million and $0.10 per share, respectively, in 2025. Income Taxes We operate in numerous taxing jurisdictions and are subject to examination by various U.S. Federal, state and foreign jurisdictions for various tax periods.
Diluted EPS –As Adjusted, EBIT on a consolidated basis, and EBIT margin on a consolidated basis are not recognized in accordance with U.S. generally accepted 21 Table of Contents accounting principles (GAAP). However, we believe that EBIT and EBIT margin provide investors and Management with valuable information for assessing our operating results.
Diluted EPS –As Adjusted, EBIT on a consolidated basis, and EBIT margin on a consolidated basis are not recognized in accordance with GAAP. However, we believe that these measures provide investors and Management with valuable information for assessing our operating results.
Inventories increased by $25.1 million during 2024 mainly due to a $14.1 million increase within the A&D segment and a $10.8 million increase within the USG segment resulting primarily from the timing of finished goods and receipt of raw materials to meet anticipated demand and an increase in work in process inventories due to timing of manufacturing existing orders.
Inventories increased by $22.3 million during 2025 mainly due to a $14.7 million increase within the A&D segment (primarily due to the Maritime acquisition), a $5.7 million increase within the Test segment and a $2.0 24 Table of Contents million increase within the USG segment resulting primarily from the timing of finished goods and receipt of raw materials to meet anticipated demand and an increase in work in process inventories due to timing of manufacturing existing orders.
Non-GAAP Financial Measures The information reported herein includes the financial measures Diluted EPS As Adjusted, which we define as Diluted EPS excluding the per-share net impact of discrete debt financing and acquisition related costs at Corporate primarily related to the pending SM&P Acquisition, restructuring charges in the A&D, Test and USG segments (primarily severance) and purchase accounting charges related to the MPE acquisition in 2024; discrete compensation and acquisition related costs at Corporate, purchase accounting charges related to the CMT acquisition, and restructuring charges primarily within the A&D segment (primarily severance) in 2023; and the per-share net impact of discrete compensation and acquisition related costs, severance charges primarily within the A&D segment, and purchase accounting charges related to the Company’s acquisitions (Altanova and NEco) in 2022; EBIT, which we define as earnings before interest and taxes; and EBIT margin, which we define as EBIT expressed as a percentage of net sales.
The principal component of other expenses, net, in 2024 was approximately $1.0 million of restructuring costs within the USG and Test segments (mainly severance charges). ​ 22 Table of Contents Non-GAAP Financial Measures The information reported herein includes the financial measures Diluted EPS As Adjusted, which we define as Diluted EPS excluding the per-share net impact of discrete acquisition related costs at Corporate, purchase accounting charges related to the Maritime acquisition, restructuring charges within the Test and USG segments, and acquisition related amortization in 2025; and discrete debt financing and acquisition related costs at Corporate primarily related to the Maritime acquisition, restructuring charges in the A&D, Test and USG segments (primarily severance), purchase accounting charges related to the MPE acquisition and acquisition related amortization in 2024; EBIT, which we define as earnings before interest and taxes; and EBIT margin, which we define as EBIT expressed as a percentage of net sales.
Cash repatriated to the U.S. is generally not subject to U.S. federal income taxes. No provision has been made in 2024 for foreign withholding or any applicable U.S. income taxes on the undistributed earnings of non-U.S. subsidiaries where these earnings are considered indefinitely invested or otherwise retained for continuing international operations.
No provision has been made in 2025 for foreign withholding or any applicable U.S. income taxes on the undistributed earnings of non-U.S. subsidiaries where these earnings are considered indefinitely invested or otherwise retained for continuing international operations. Determination of the amount of taxes that might be paid on these undistributed earnings if eventually remitted is not practicable.
Critical Accounting Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires Management to make estimates and assumptions in certain circumstances that affect amounts reported in the Consolidated Financial Statements.
During 2024, the Company repurchased approximately 80,500 shares for approximately $8.0 million. ​ 25 Table of Contents Critical Accounting Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires Management to make estimates and assumptions in certain circumstances that affect amounts reported in the Consolidated Financial Statements.
The $6.9 million increase in SG&A expenses in 2024 as compared to 2023 was mainly due to an increase within the A&D and USG segments due to higher sales; inflationary impacts; and MPE acquisition impacts.
The $26.4 million increase in SG&A expenses in 2025 as compared to 2024 was mainly due to an increase within the A&D segment (due to the Maritime acquisition) and the Test and USG segments due to higher sales, inflationary impacts, and an increase at Corporate mainly due to acquisition costs.
Backlog at September 30, 2024 was $879.0 million, an increase of $106.6 million, or 13.8%, compared to backlog of $772.4 million at September 30, 2023. ● The Company declared dividends of $0.32 per share during 2024, totaling $8.2 million in dividend payments.
Backlog at September 30, 2025 was $1,133.6 million, an increase of $469.4 million, or 70.7%, compared to backlog from continuing operations of $664.2 million at September 30, 2024. ● The Company declared dividends of $0.32 per share during 2025, totaling $8.3 million in dividend payments.
The $11.8 million, or 5.3%, decrease in net sales in 2024 as compared to 2023 was due to an $11.8 million decrease in sales from the Company’s U.S. operations and a $2.8 million decrease in sales from the Company’s Asian operations due to lower wireless, filters and acoustic volumes and timing of test and measurement chamber projects partially offset by a $2.8 million increase in sales from the segment’s European operations.
Test The $27.7 million, or 13.2%, increase in net sales in 2025 as compared to 2024 was due to a $15.4 million increase in sales from the Company’s U.S. operations, an $8.8 million increase in sales from the Company’s European operations, and a $3.5 million increase in sales from the Company’s Asian operations due to higher test and measurement, industrial shielding, medical services and filters volumes partially offset by lower wireless volumes.
Year-to-year comparisons of the 2023 financial information to the same information for 2022 are contained in Item 7 of our Form 10-K for 2023 filed with the Securities and Exchange Commission on November 29, 2023 and available through the SEC’s website at https://www.sec.gov/edgar/searchedgar/companysearch.html . 18 Table of Contents Introduction We classify our business operations into three segments for financial reporting purposes, although for reporting certain financial information we treat Corporate activities as a separate segment.
Year-to-year comparisons of the 2024 financial information to the same information for 2023 are contained in Item 7 of our Form 10-K for 2024 filed with the Securities and Exchange Commission on November 29, 2024 and available through the SEC’s website at https://www.sec.gov/edgar/searchedgar/companysearch.html .
EBIT ​ The reconciliation of EBIT to a GAAP financial measure is as follows: ​ ​ ​ ​ ​ ​ ​ (Dollars in millions) 2024 2023 Net earnings ​ $ 101.9 ​ 92.5 Add: Interest expense, net ​ 15.2 8.8 Add: Income tax expense ​ 28.0 26.4 EBIT ​ $ 145.1 ​ 127.7 ​ EBIT by business segment is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change ​ ​ Fiscal year ended ​ 2024 (Dollars in millions) 2024 2023 vs. 2023 A&D ​ $ 84.7 71.6 18.3 % % of net sales ​ 18.9 % 18.2 % — ​ USG ​ 85.9 76.7 12.0 % % of net sales ​ 23.3 % 22.4 % — ​ Test ​ 28.6 32.4 (11.7) % % of net sales ​ 13.7 % 14.6 % — ​ Corporate ​ (54.1) (53.0) (2.1) % Total ​ $ 145.1 127.7 13.6 % % of net sales ​ 14.1 % 13.4 % — ​ ​ A&D The $13.1 million, or 18.3%, increase in EBIT in 2024 as compared to 2023 was primarily due to leverage on higher sales volumes and price increases at Mayday, PTI, Crissair and Globe partially offset by a decrease in EBIT at VACCO due to margin erosion on certain space development contracts, revenue mix and inflationary pressures.
EBIT ​ The reconciliation of EBIT from continuing operations to a GAAP financial measure is as follows: ​ ​ ​ ​ ​ ​ ​ (Dollars in millions) 2025 2024 Net earnings from continuing operations ​ $ 116.3 ​ 102.6 Add: Interest expense, net ​ 17.5 15.2 Add: Income tax expense ​ 36.6 28.4 EBIT from continuing operations ​ $ 170.4 ​ 146.2 ​ EBIT by business segment is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change ​ ​ Fiscal year ended ​ 2025 (Dollars in millions) 2025 2024 vs. 2024 A&D ​ $ 125.1 85.8 45.8 % % of net sales ​ 26.2 % 25.2 % — ​ USG ​ 94.7 85.9 10.2 % % of net sales ​ 24.9 % 23.3 % — ​ Test ​ 34.1 28.6 19.2 % % of net sales ​ 14.4 % 13.7 % — ​ Corporate ​ (83.5) (54.1) (54.3) % Total ​ $ 170.4 146.2 16.6 % % of net sales ​ 15.6 % 15.9 % — ​ ​ A&D The $39.3 million, or 45.8%, increase in EBIT in 2025 as compared to 2024 was primarily due to leverage on higher sales volumes and price increases at Mayday, PTI, Crissair and Globe and the contribution from the current year acquisition of Maritime partially offset by a decrease in EBIT due to inflationary pressures.
Net cash provided by operating activities was $127.5 million in 2024 and $76.9 million in 2023. The increase in net cash provided by operating activities in 2024 as compared to 2023 was mainly driven by higher net earnings and lower working capital requirements. Net cash used in investing activities was $104.6 million in 2024 and $52.5 million in 2023.
Net cash provided by operating activities from continuing operations was $200.4 million in 2025 and $121.6 million in 2024. The increase in net cash provided by operating activities in 2025 as compared to 2024 was mainly driven by higher net earnings and lower working capital requirements.
Selling, General and Administrative Expenses Selling, general and administrative (SG&A) expenses were $224.0 million, or 21.8% of net sales, in 2024, and $217.1 million, or 22.7% of net sales, in 2023.
Selling, General and Administrative Expenses Selling, general and administrative (SG&A) expenses were $234.6 million, or 21.4% of net sales, in 2025, and $208.2 million, or 22.7% of net sales, in 2024.
Results of Operations Net Sales ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change ​ ​ Fiscal year ended ​ 2024 (Dollars in millions) 2024 2023 vs. 2023 A&D ​ $ 448.2 392.4 14.2 % USG ​ 369.1 342.3 7.8 % Test ​ 209.5 221.3 (5.3) % Total ​ $ 1,026.8 956.0 7.4 % ​ Net sales increased $70.8 million, or 7.4%, to $1,026.8 million in 2024 from $956.0 million in 2023.
Results of Continuing Operations Net Sales ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change ​ ​ Fiscal year ended ​ 2025 (Dollars in millions) 2025 2024 vs. 2024 A&D ​ $ 478.2 340.5 40.4 % USG ​ 380.0 369.1 3.0 % Test ​ 237.2 209.5 13.2 % Total ​ $ 1,095.4 919.1 19.2 % ​ Net sales increased $176.3 million, or 19.2%, to $1,095.4 million in 2025 from $919.1 million in 2024.
Other Expenses, Net Other expenses, net, was $2.1 million in 2024, compared to other expenses, net, of $1.9 million in 2023. The principal component of other expenses, net, in 2024 was approximately $1.8 million of restructuring costs within the A&D, USG and Test segments (mainly severance charges). There were no individually significant items in other expenses, net in 2023.
Other Expenses, Net Other expenses, net, were $2.8 million in 2025, compared to $1.4 million in 2024. The principal component of other expenses, net, in 2025 was approximately $1.0 million of restructuring charges within the USG and Test segments (mainly severance charges) and $1.3 million of UK stamp duty charges due to the Maritime acquisition.
Income Tax Expense The effective tax rates for 2024 and 2023 were 21.6% and 22.2%, respectively. The decrease in the 2024 effective tax rate as compared to 2023 was primarily due to a decrease in non-deductible executive compensation partially offset by an increase in state income tax expense.
Income Tax Expense The effective tax rates from continuing operations for 2025 and 2024 were 23.9% and 21.6%, respectively. The increase in the 2025 effective tax rate as compared to 2024 was primarily due to an increase in non-deductible executive compensation, increased non-deductible transaction costs and a reduction in the foreign-derived intangible income deduction.
Diluted EPS – As Adjusted for 2023 was $3.70 excluding $4.1 million of pretax charges (or $0.12 per share after tax), consisting of executive management transition costs and acquisition related costs at Corporate, CMT purchase accounting adjustments, and restructuring charges primarily within the A&D segment.
Diluted EPS – As Adjusted for 2024 was $4.77 excluding $26.7 million of pretax charges (or $0.80 per share after tax), consisting of debt financing and acquisition costs at Corporate primarily related to the Maritime acquisition, restructuring charges in the A&D, Test and USG segments, MPE purchase accounting adjustments, and acquisition-related amortization.
Our three operating segments during 2024 were Aerospace & Defense (A&D), Utility Solutions Group (USG), and RF Test & Measurement (Test). Our operating segments are comprised of the following primary operating subsidiaries: ● A&D : PTI Technologies Inc. (PTI); VACCO Industries (VACCO); Crissair, Inc. (Crissair); Globe Composite Solutions, LLC (Globe, including Westland Technologies, Inc.); and Mayday Manufacturing Co.
Our operating segments are comprised of the following primary operating subsidiaries: ● A&D : PTI Technologies Inc. (PTI); Crissair, Inc. (Crissair); Globe Composite Solutions, LLC (Globe, which also includes Westland Technologies, Inc.); Mayday Manufacturing Co.
We do not believe there is a great 24 Table of Contents likelihood that materially different amounts would be reported under different conditions or using different assumptions related to the accounting policies described below.
In preparing these financial statements, Management has made its best estimates and judgments of certain amounts included in the Consolidated Financial Statements, giving due consideration to materiality. We do not believe there is a great likelihood that materially different amounts would be reported under different conditions or using different assumptions related to the accounting policies described below.
The $55.8 million, or 14.2%, increase in net sales in 2024 as compared to 2023 was mainly due to a $15.7 million increase in commercial aerospace revenues, a $20.3 million increase in defense aerospace revenues and a $20.0 million increase in navy revenues.
A&D The $137.7 million, or 40.4%, increase in net sales in 2025 as compared to 2024 was mainly due to a $94.1 million increase in navy revenues and a $39.8 million increase in commercial aerospace revenues, partially offset by a $5.2 million decrease in defense aerospace revenues.
The increase in net sales in 2024 as compared to 2023 was mainly due to a $55.8 million increase in the A&D segment and a $26.8 million increase in the USG segment, partially offset by an $11.8 million decrease in the Test segment. A&D .
The increase in net sales in 2025 as compared to 2024 was mainly due to a $137.7 million increase in the A&D segment, a $10.9 million increase in the USG segment, and a $27.7 million increase in the Test segment.
At September 30, 2024 we have determined that no goodwill or other long-lived assets were impaired. We amortize intangible assets with estimable useful lives over their respective estimated useful lives to their estimated residual values, and review them for impairment whenever events or changes in business circumstances indicate the carrying value of the assets may not be recoverable.
We amortize intangible assets with estimable useful lives over their respective estimated useful lives to their estimated residual values, and review them for impairment whenever events or changes in business circumstances indicate the carrying value of the assets may not be recoverable. ​ 27 Table of Contents Business Combinations We account for business combinations using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed are recorded at their respective fair values at the date of acquisition.
See “ Non-GAAP Financial Measures ” below. ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year ended (Dollars in millions) 2024 2023 Diluted EPS – GAAP ​ $ 3.94 3.58 Debt financing costs related to pending SM&P Acquisition ​ 0.09 — Acquisition related costs ​ 0.06 0.01 Restructuring adjustments ​ ​ 0.05 0.03 Purchase accounting adjustments ​ ​ 0.04 ​ 0.02 Executive management transition costs ​ ​ — ​ 0.06 Diluted EPS – As Adjusted ​ $ 4.18 ​ 3.70 ​ ● At September 30, 2024, cash on hand was $66.0 million and outstanding debt was $122.0 million, for a net debt position (total debt less cash on hand) of approximately $56.0 million. ● Entered orders for 2024 were $1,133.4 million resulting in a book-to-bill ratio of 1.10x.
See “ Non-GAAP Financial Measures ” below. ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year ended (Dollars in millions) 2025 2024 Diluted EPS – Continuing Operations GAAP ​ $ 4.49 3.97 Acquisition related costs / debt financing costs ​ 0.15 0.15 Purchase accounting adjustments ​ ​ 0.14 0.04 Restructuring adjustments ​ ​ 0.02 ​ 0.02 Acquisition related amortization ​ ​ 1.23 ​ 0.59 Diluted EPS – Continuing Operations As Adjusted ​ $ 6.03 ​ 4.77 ​ ● At September 30, 2025, cash on hand was $101.4 million and outstanding debt was $186 million, for a net debt position (total debt less cash on hand) of approximately $84.6 million. ● On April 25, 2025, the Company completed the acquisition of the Signature Management & Power business (renamed ESCO Maritime Solutions or Maritime) for a purchase price of approximately $472 million, net of cash acquired. ● Entered orders for 2025 from continuing operations were $1,564.8 million (including $364.2 million of Maritime acquired backlog) resulting in a book-to-bill ratio of 1.43x.
In addition, the Company incurred expenditures for capitalized software of $12.1 million in 2024 and $12.4 million in 2023. There were no commitments outstanding that were considered material for capital expenditures at September 30, 2024.
The increase in 2025 as compared to 2024 was mainly due to modest increases across all three business segments. In addition, the Company incurred expenditures for capitalized software and other of $15.8 million in 2025 and $11.9 million in 2024. There were no commitments outstanding that were considered material for capital expenditures at September 30, 2025.
Mayday manufactures mission-critical bushings, pins, sleeves and precision-tolerance machined components for landing gear, rotor heads, engine mounts, flight controls, and actuation systems for the aerospace and defense industries. USG. Doble develops, manufactures and delivers diagnostic testing solutions that enable electric power grid operators to assess the integrity of high-voltage power delivery equipment.
Mayday manufactures mission-critical bushings, pins, sleeves and precision-tolerance machined components for landing gear, rotor heads, engine mounts, flight controls, and actuation systems for the aerospace and defense industries. Globe designs, develops and manufactures elastomeric-based signature reduction solutions for U.S. naval vessels.
EBIT in 2024 was negatively impacted by $0.2 million of restructuring charges (mainly severance).
EBIT in 2025 was negatively impacted by $0.5 million of restructuring charges (mainly severance). Corporate Corporate costs included in 2025 consolidated EBIT increased to $83.5 million as compared to $54.1 million in 2024.
Highlights of 2024 ● Sales and net earnings in 2024 were $1,026.8 million and $101.9 million, respectively, compared to sales and net earnings in 2023 of $956.0 million and $92.5 million, respectively. ● Diluted EPS – GAAP for 2024 increased 10.1% to $3.94, compared to Diluted EPS – GAAP for 2023 of $3.58. 19 Table of Contents ● Diluted EPS – As Adjusted for 2024 was $4.18 excluding $8.0 million of pretax charges (or $0.24 per share after tax), consisting of debt financing and acquisition costs at Corporate primarily related to the pending SM&P Acquisition that was announced in July 2024, restructuring charges in the A&D, Test and USG segments, and MPE purchase accounting adjustments.
Diluted EPS – GAAP for 2025 was $11.55 compared to Diluted EPS – GAAP for 2024 of $3.94. 20 Table of Contents ● Diluted EPS – As Adjusted for 2025 was $6.03 excluding $52.1 million of pretax charges (or $1.54 per share after tax), consisting of acquisition costs at Corporate and purchase accounting adjustments primarily related to the Maritime acquisition, restructuring charges in the USG and Test segments, and acquisition related amortization.
The increase in interest expense in 2024 was mainly due to the $3.1 million of debt financing costs related to the pending SM&P Acquisition, higher average interest rates and higher outstanding borrowings. The weighted average interest rates were 6.72% in 2024 compared to 5.82% in 2023. Average outstanding borrowings were $167 million in 2024 compared to $140 million in 2023.
Interest Expense, Net Interest expense, net was $17.5 million and $15.2 million in 2025 and 2024, respectively. The increase in interest expense in 2025 was mainly due to higher average outstanding borrowings related to the Maritime acquisition in April 2025. Average outstanding borrowings were $265 million in 2025 compared to $167 million in 2024.
(Mayday);. ● USG : Doble Engineering Company, Morgan Schaffer Ltd. (Morgan Schaffer) and I.S.A. – Altanova Group S.r.l. and affiliates (Altanova) (collectively, Doble); and NRG Systems, Inc. (NRG). ● Test : ETS-Lindgren Inc. (ETS-Lindgren) and MPE Limited (MPE). A&D.
(Mayday); and since April 25, 2025, ESCO Maritime Solutions (or Maritime), consisting of ESCO Maritime Solutions, Ltd., DNE Technologies, Inc.(DNE), EMS Development Corporation (EMS), Measurement Systems, Inc. (MSI) and PMES I Limited. ● USG : Doble Engineering Company (Doble), Morgan Schaffer Ltd. (Morgan Schaffer), and I.S.A. – Altanova Group S.r.l. and affiliates (Altanova); and NRG Systems, Inc.
Orders are entered into backlog as firm purchase order commitments are received. By operating segment, 2024 orders were $564.5 million related to A&D products, $355.6 million related to USG products, and $213.3 million related to Test products, and 2023 orders were $468.2 million related to A&D products, $347.6 million related to USG products, and $217.5 million related to Test products.
By operating segment, 2025 orders were $895.6 million related to A&D products (including $364.2 million of Maritime acquired backlog), $403.5 million related to USG products, and $265.7 million related to Test products; and 2024 orders were $430.9 million related to A&D products, $355.6 million related to USG products, and $213.3 million related to Test products.
Test The $3.8 million, or 11.7%, decrease in EBIT in 2024 as compared to 2023 was primarily due to a decrease in EBIT from the segment’s U.S. and Asian operations and inflationary pressure, partially offset by leverage on higher sales volumes from the segment’s European operations and price increases and cost reduction actions from the segment’s U.S. operations.
EBIT in 2025 was negatively impacted by $0.4 million of restructuring charges (mainly severance). 23 Table of Contents Test The $5.5 million, or 19.2%, increase in EBIT in 2025 as compared to 2024 was primarily due to an increase in EBIT from the segment’s U.S. and European operations and price increases, partially offset by a decrease in EBIT from the Company’s Asian operations, inflationary pressures and unfavorable mix.
PTI, VACCO and Crissair primarily design and manufacture specialty filtration products, including hydraulic filter elements and fluid control devices used in commercial and defense aerospace applications, unique filter mechanisms used in micro-propulsion devices for satellites and custom designed filters for manned aircraft and submarines. Globe designs, develops and manufactures elastomeric-based signature reduction solutions for U.S. naval vessels.
PTI and Crissair primarily design and manufacture specialty filtration products, including hydraulic filter elements and fluid control devices used in commercial and defense aerospace applications, and miniature electro-explosive devices for military aircraft ejection seats and missile arming devices.
Accounts receivable increased by $42.1 million during 2024 mainly due to a $20.4 million increase within the A&D segment, a $12.2 million increase within the Test segment and a $9.5 million increase within the USG segment, driven by timing and higher sales volumes in the current year.
Accounts receivable increased by $31.5 million during 2025 mainly due to an approximately $30.6 million increase within the A&D segment (primarily due to the Maritime acquisition), a $5.8 million increase within the Test segment, partially offset by a $4.9 million decrease within the USG segment.
MPE contributed $10 million in revenue in 2024 since the date of acquisition. Orders and Backlog New orders received were $1,133.4 million in 2024 and $1,033.3 million in 2023. Order backlog was $879.0 million at September 30, 2024, compared to order backlog of $772.4 million at September 30, 2023.
Orders and Backlog New orders received from continuing operations were $1,564.8 million in 2025 and $999.8 million in 2024. Order backlog was $1,133.6 million at September 30, 2025, compared to order backlog from continuing operations of $664.2 million at September 30, 2024. Orders are entered into backlog as firm purchase order commitments are received.
Removed
By subsidiary, the $55.8 million increase in net sales in 2024 as compared to 2023 was due to an $18.1 million increase in net sales at PTI, a $12.6 million increase in net sales at Globe, a $10.1 million increase in net sales at Crissair, a $7.6 million increase in net sales at Mayday and a $7.4 million increase in net sales at VACCO. 20 Table of Contents USG .
Added
On May 20, 2025, the Company announced it had entered into a definitive agreement to sell VACCO Industries (VACCO) to RBC Bearings Incorporated (RBC), an international manufacturer and marketer of highly engineered precision bearings and products, headquartered in Oxford, Connecticut. The Company completed this divestiture on July 18, 2025.
Removed
EBIT in 2024 was negatively impacted by $1.2 million in restructuring charges (mainly severance).
Added
The Company received net proceeds from the sale of approximately $270 million and recorded a $172.6 million after-tax gain on the sale in the fourth quarter of 2025. The Company used the proceeds from the sale to primarily pay down debt.
Removed
EBIT in 2024 was negatively impacted by $0.3 million of inventory step-up charges related to the MPE acquisition and $0.2 million of restructuring charges (mainly severance). 22 Table of Contents Corporate Corporate operating charges included in 2024 consolidated EBIT increased to $54.1 million as compared to $53.0 million in 2023 mainly due to an increase in professional fees, including acquisition related costs, and amortization expense of acquired intangible assets related to the Company’s recent acquisition of MPE.
Added
The VACCO business is reflected as discontinued operations in the Consolidated Financial Statements and related notes for all periods presented, in accordance with accounting principles generally accepted in the United States of America (GAAP). The sale of VACCO represents a strategic shift for the Company to exit the Space business.
Removed
The “Reconciliation to Consolidated Totals (Corporate)” in Note 9 to the Consolidated Financial Statements represents Corporate office operating charges. Interest Expense, Net Interest expense, net was $15.2 million and $8.8 million in 2024 and 2023, respectively.
Added
Net sales from the VACCO business were $102.9 million, $107.6 million and $100.2 million for the period October 1, 2024 through July 18, 2025 and years ending September 30, 2024 and 2023, respectively. Pretax earnings (loss) from the VACCO business were $13.7 million, $(1.1) million and $8.6 million for the years ending September 30, 2025, 2024 and 2023, respectively.
Removed
Determination of the amount of taxes that might be paid on these undistributed earnings if eventually remitted is not practicable. The Organization for Economic Co-operation and Development’s (OECD) Global Anti-Base Erosion Model (Pillar Two) rules are effective beginning with the Company’s fiscal year ending September 30, 2025.
Added
Introduction We classify our business operations into three segments for financial reporting purposes, although for reporting certain financial information we treat Corporate activities as a separate segment. Our three operating segments during 2025 were Aerospace & Defense (A&D), Utility Solutions Group (USG), and RF Test & Measurement (Test).
Removed
Pillar Two rules generally provide for a 15 percent minimum effective tax rate in every jurisdiction in which the Company operates. At present, Pillar Two is not expected to have a significant impact on our consolidated financial statements or related disclosures.
Added
(NRG) (except as the context may otherwise indicate, Doble also includes Morgan Schaffer, Altanova and ESCO’s other USG segment subsidiaries other than NRG). ● Test : ETS-Lindgren Inc. (ETS-Lindgren) and MPE Limited (MPE) (except as the context may otherwise indicate, ETS-Lindgren also includes MPE and ESCO’s other Test segment subsidiaries). A&D.
Removed
On July 8, 2024, the Company and certain of its wholly owned subsidiaries entered into a Sale and Purchase Agreement (“Purchase Agreement”) with Ultra Electronics Holdings Limited, a private limited liability company incorporated in England & Wales (“Ultra”), pursuant to which one or more wholly owned subsidiaries of the Company will acquire from Ultra or its subsidiaries Ultra’s Signature Management & Power (“SM&P”) business, including all of the issued and outstanding equity interests of (i) Ultra PMES Limited, a private limited liability company incorporated in England & Wales (“the UK Target Company”), (ii) Measurement Systems, Inc., a Delaware corporation, (iii) EMS Development Corporation, a New York corporation, and (iv) DNE Technologies, a Delaware corporation, for a purchase price of approximately $550 million, plus or minus certain customary adjustments at closing and post-closing for cash, debt, working capital and transaction expenses as specified in the Purchase Agreement (the “SM&P Acquisition”).
Added
Maritime is an established, long-standing business providing mission-critical signature and power management solutions for the US and UK naval defense markets. USG. Doble develops, manufactures and delivers diagnostic testing solutions that enable electric power grid operators to assess the integrity of high-voltage power delivery equipment.
Removed
The closing of the SM&P Acquisition is subject to certain conditions, including receipt of clearance under the UK National Security and Investment Act of 2021. 23 Table of Contents Capital Resources and Liquidity Our overall financial position and liquidity are strong.
Added
Highlights of 2025 ● Sales and net earnings from continuing operations in 2025 were $1,095.4 million and $116.3 million, respectively, compared to sales and net earnings from continuing operations in 2024 of $919.1 million and $102.6 million, respectively. ● Diluted EPS – GAAP from continuing operations for 2025 increased 13.1% to $4.49, compared to Diluted EPS – GAAP from continuing operations for 2024 of $3.97.
Removed
Working capital (current assets less current liabilities) increased to $318.8 million at September 30, 2024 from $266.4 million at September 30, 2023.
Added
EBIT in 2025 was negatively impacted by $4.5 million primarily consisting of inventory step-up charges and UK stamp duty charges related to the Maritime acquisition.
Removed
Accounts payable increased by $11.4 million during 2024 mainly due to a $4.5 million increase within the A&D segment, a $3.1 million increase within the Test segment, a $2.3 million increase within the USG segment, and a $1.5 million increase at Corporate due to the timing of payments.
Added
The increase in Corporate costs in 2025 as compared to 2024 was mainly due to a $21.4 million increase in acquisition related amortization expense and $5.5 million of acquisition costs, both primarily due to the Maritime acquisition, as well as an increase in share-based compensation costs.
Removed
The increase in 2024 as compared to 2023 was mainly due to the MPE acquisition in the current year. Capital expenditures were $36.2 million in 2024 and $22.4 million in 2023. The increase in 2024 as compared to 2023 was mainly due to an increase in building improvements and machinery & equipment within the A&D segment.
Added
Divestiture In July 2025, we completed the sale of our former A&D subsidiary VACCO Industries (VACCO) for net sales proceeds of approximately $270 million. The sale was made as part of our strategic portfolio analysis, which is focused on positioning us to serve high-growth markets that have high margin potential.
Removed
During 2023, the Company repurchased approximately 140,000 shares for approximately $12.4 million. The Company did not purchase any shares during the fourth quarter of 2024.
Added
VACCO is reflected as discontinued operations in the Consolidated Financial Statements and related notes for all periods shown in this Annual Report. Capital Resources and Liquidity Our overall financial position and liquidity are strong. Working capital from continuing operations (current assets less current liabilities) decreased to $180.4 million at September 30, 2025 from $283.9 million at September 30, 2024.
Removed
In preparing these financial statements, Management has made its best estimates and judgments of certain amounts included in the Consolidated Financial Statements, giving due consideration to materiality.
Added
The main driver of the decrease was an increase in contract liabilities of $135.7 million primarily due to the Maritime acquisition and increases at Globe and Doble.
Added
Net cash used in investing activities from continuing operations was $524.2 million in 2025 and $96.6 million in 2024. The increase in 2025 as compared to 2024 was mainly due to the Maritime acquisition completed on April 25, 2025. Capital expenditures from continuing operations were $36.3 million in 2025 and $28.3 million in 2024.
Added
At September 30, 2025 we have determined that no goodwill or other long-lived assets were impaired.
Added
The determination of the acquisition date fair values of identifiable assets acquired and liabilities assumed requires estimates and the use of valuation techniques when fair value is not readily available and requires a significant amount of management judgment. For the valuation of intangible assets acquired in a business combination, we typically use an income approach.
Added
Specifically, for the Maritime acquisition, we used the multi-period excess earnings method to determine the estimated acquisition date fair values of the customer relationship and backlog intangible assets. The significant assumptions used to estimate the fair values of these intangible assets included forecasted revenues, expected customer attrition rates, and the discount rate applied.
Added
Although the Company believes its estimates of acquisition date fair values are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates.
Added
Changes in assumptions concerning future financial results of other underlying assumptions could have a significant impact on the determination of the fair values of the customer relationship and backlog intangible assets acquired. The excess of the purchase price over fair values of identifiable assets acquired and liabilities assumed is recorded as goodwill.
Added
During the measurement period, which is up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill due to the use of preliminary information in our initial estimates. Upon conclusion of the measurement period, any subsequent adjustments are recorded to earnings.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk See "Other Matters - Quantitative And Qualitative Disclosures About Market Risk" in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," which is incorporated into this Item by reference. ​ 26 Table of Contents
Biggest changeItem 7A. Quantitative and Qualitative Disclosures about Market Risk See “Other Matters - Quantitative And Qualitative Disclosures About Market Risk” in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which is incorporated into this Item by reference. ​

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