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

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Paragraph-level year-over-year comparison of CORE MOLDING 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.

+171 added−146 removedSource: 10-K (2026-03-10) vs 10-K (2025-03-11)

Top changes in CORE MOLDING TECHNOLOGIES INC's 2025 10-K

171 paragraphs added · 146 removed · 129 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeIn general, the Company achieves product growth and diversification in several different ways, including: (1) resourcing of existing structural products from another supplier by an original equipment manufacturer (“OEM”); (2) obtaining new structural products through a selection process in which an OEM solicits bids; (3) successful marketing of structural products for previously non-structural applications; (4) converting alternative materials to engineered materials; (5) successful marketing of structural products to OEMs outside of our traditional markets; (6) developing of new materials, technology and processes to meet current or prospective customer requirements; and (7) acquiring an existing business.
Biggest changeIn general, the Company achieves product growth and diversification in several different ways, including: (1) resourcing of existing structural products from another supplier by an original equipment manufacturer (“OEM”); (2) obtaining new structural products through a selection process in which an OEM solicits bids; (3) successful marketing of structural products for previously non-structural applications; (4) successful marketing of structural products to OEMs outside of our traditional markets; (5) developing of new materials, technology and processes to meet current or prospective customer requirements; (6) converting alternative materials to engineered materials; (7) expanding its business through the direct sale of engineered materials, including Sheet Molding Compound ("SMC"); and (8) acquiring an existing business.
February 14, 2026 51 To support the Company’s long-term strategic plan, the Company is committed to being an employer of choice focusing on providing a safe place to work, organizational development opportunities, talent planning and a competitive total rewards package. Safety – The safety of the Company's workforce is a top priority with continued improvement in the Company's safety record.
February 14, 2026 59 To support the Company’s long-term strategic plan, the Company is committed to being an employer of choice focusing on providing a safe place to work, organizational development opportunities, talent planning and a competitive total rewards package. Safety – The safety of the Company's workforce is a top priority with continued improvement in the Company's safety record.
During times when demand exceeds the standard five day, three -shift capacity, the Company will work weekends to create additional capacity, which can provide capacity utilization percentages greater than 100%. During 2024, the Company has used various methods from overtime to weekend manpower crews to support the customers' production requirements.
During times when demand exceeds the standard five day, three -shift capacity, the Company will work weekends to create additional capacity, which can provide capacity utilization percentages greater than 100%. During 2025, the Company has used various methods from overtime to weekend manpower crews to support the customers' production requirements.
Sales to these customers individually were all less than 10% of total sales for interim and annual reporting during 2024, 2023, and 2022. 7 Table of Contents GEOGRAPHIC INFORMATION Substantially all of the Company's products are sold in U.S. dollars.
Sales to these customers individually were all less than 10% of total sales for interim and annual reporting during 2025, 2024, and 2023. 7 Table of Contents GEOGRAPHIC INFORMATION Substantially all of the Company's products are sold in U.S. dollars.
See below under "Item 1A Risk Factors - Legal, Insurance, Tax and Cybersecurity Risks - Changes in legal, regulatory, and social responses to climate change, including any possible effect on energy prices, could adversely affect our business and reduce our profitability ." 9 Table of Contents The Company has Environmental Management Systems at all of its facilities and has obtained ISO 14001 certification at all facilities.
See below under "Item 1A Risk Factors - Legal, Insurance, Tax and Cybersecurity Risks - Changes in legal, regulatory, and social responses to climate change, including any possible effect on energy prices, could adversely affect our business and reduce our profitability ." The Company has Environmental Management Systems at all of its facilities and has obtained ISO 14001 certification at all facilities.
The Company faces competition from a number of other molders including, most significantly, Molded Fiber Glass Companies, Teijin, Ashley Industrial Molding, René Matériaux Composite Ltée ("RMC"), STS Group, and 20/20 Custom Molded Plastics. RAW MATERIALS The principal raw materials used in the Company's processes are unsaturated polyester, vinyl ester, polyethylene, polypropylene, and dicyclopentadiene resins, fiberglass, and filler.
The Company faces competition from a number of other molders including, most significantly, Molded Fiber Glass Companies, CSP, Ashley Industrial Molding, René Matériaux Composite Ltée ("RMC"), STS Group, and 20/20 Custom Molded Plastics. RAW MATERIALS The principal raw materials used in the Company's processes are unsaturated polyester, vinyl ester, polyethylene, polypropylene, and dicyclopentadiene resins, fiberglass, and various filler's.
Management has estimated that costs related to research and development were approximately $1.9 million, $1.7 million and $1.6 million in 2024, 2023, and 2022, respectively. MAJOR CUSTOMERS The Company had five major customers during the years ended December 31, 2024, 2023, and 2022, BRP, Inc. ("BRP"), International Motors, LLC ("International"), PACCAR, Inc.
Management has estimated that costs related to research and development were approximately $1.4 million, $1.9 million and $1.7 million in 2025, 2024, and 2023, respectively. MAJOR CUSTOMERS The Company had five major customers during the years ended December 31, 2025, 2024, and 2023, BRP, Inc. ("BRP"), International Motors, LLC ("International"), PACCAR, Inc.
The Company measures facility capacity in terms of its large injection molding presses (750 tons or greater). The Company owned 12 large injection molding presses at its facilities at December 31, 2024. The capacity utilization in these production facilities was 52% and 64% for the years ended December 31, 2024 and 2023, respectively.
The Company measures facility capacity in terms of its large injection molding presses (750 tons or greater). The Company owned 12 large injection molding presses at its facilities at December 31, 2025. The capacity utilization in these production facilities was 46% and 52% for the years ended December 31, 2025 and 2024, respectively.
The Company incorporates a sophisticated computer program in the process of compounding various complex SMC formulations tailored to meet customer needs. The program provides for the control of information during various production processes and data for statistical batch controls. The Company also sells SMC to other molders.
The Company incorporates a sophisticated computer program in the process of compounding various complex SMC formulations tailored to meet customer needs. The program provides for the control of information during various production processes and data for statistical batch controls.
The following table presents sales to major customers as a percent of total sales for the years ended December 31: 2024 2023 2022 Supply Agreement Supply Agreement Expiration BRP 10% 14% 14% Yes July 31, 2029 International 22% 20% 17% No N/A PACCAR 13% 10% 10% No N/A Yamaha 10% 9% 6% No N/A Volvo 14% 16% 14% Yes December 31, 2027 BRP provides a portfolio of industry-leading products comprising of snowmobiles, watercraft, on and off-road vehicles, power sports propulsion systems as well as engines for karts, motorcycles and recreational aircraft.
The following table presents sales to major customers as a percent of total sales for the years ended December 31: 2025 2024 2023 Supply Agreement Supply Agreement Expiration BRP 14% 10% 14% Yes July 31, 2029 International 28% 22% 20% No N/A PACCAR 11% 13% 10% No N/A Yamaha 8% 10% 9% No N/A Volvo 4% 14% 16% Yes December 31, 2027 BRP provides a portfolio of industry-leading products comprising of snowmobiles, watercraft, on and off-road vehicles, power sports propulsion systems as well as engines for karts, motorcycles and recreational aircraft.
However, new requirements, more stringent application of existing requirements or the discovery of previously unknown environmental conditions could result in material environmental related expenditures in the future.
However, new requirements, more stringent application of existing requirements or the discovery of previously 9 Table of Contents unknown environmental conditions could result in material environmental related expenditures in the future.
The Company measures facility capacity in terms of its large compression molding presses (2,000 tons or greater). The Company owned 28 large compression molding presses at its facilities at December 31, 2024. The capacity utilization in these production facilities was 73% and 83% for the years ended December 31, 2024 and 2023, respectively.
The Company measures facility capacity in terms of its large compression molding presses (2,000 tons or greater). The Company owned 25 large compression molding presses at its facilities at December 31, 2025. The capacity utilization in these production facilities was 50% and 73% for the years ended December 31, 2025 and 2024, respectively.
CAPITAL EXPENDITURES AND RESEARCH AND DEVELOPMENT Capital expenditures totaled approximately $11.5 million, $9.1 million, and $16.6 million in 2024, 2023, and 2022 respectively. These capital expenditures primarily consisted of building and equipment improvements and additional production equipment to manufacture parts. The Company continuously engages in product development.
CAPITAL EXPENDITURES AND RESEARCH AND DEVELOPMENT Capital expenditures totaled approximately $17.3 million, $11.5 million, and $9.1 million in 2025, 2024, and 2023, respectively. These capital expenditures primarily consisted of building and equipment improvements and additional production equipment to manufacture parts. The Company continuously engages in product development.
Details on the collective bargaining agreements are as follows: Plant Location Union Name Expiration Date Employees Columbus, Ohio International Association of Machinists and Aerospace Workers ("IAM") August 9, 2025 212 Matamoros, Mexico Sindicato de Jorneleros y Obreros December 31, 2025 657 Cobourg, Canada United Food & Commercial Workers Canada ("UFCW") November 1, 2025 138 Escobedo, Mexico Sindicato de trabajadores de la industria metalica y del comercio del estado de Nuevo Leon Presidente Benito Juarez Garcia C.T.M.
Details on the collective bargaining agreements are as follows: Plant Location Union Name Expiration Date Employees Columbus, Ohio International Association of Machinists and Aerospace Workers ("IAM") August 12, 2028 125 Matamoros, Mexico Sindicato de Jorneleros y Obreros December 31, 2026 501 Cobourg, Canada United Food & Commercial Workers Canada ("UFCW") November 1, 2025 130 Monterrey, Mexico Sindicato de trabajadores de la industria metalica y del comercio del estado de Nuevo Leon Presidente Benito Juarez Garcia C.T.M.
Many of the raw materials used by the Company are petrochemical-based, natural gas-based, as well as downstream derivatives, and therefore, the costs of certain raw materials can be affected by changes in costs in these upstream commodities. Due to fluctuating commodity prices, suppliers are typically reluctant to enter into long-term contracts.
Many of the raw materials used by the Company are petrochemical-based, natural gas-based, as well as downstream derivatives, and therefore, the costs of certain raw materials can be affected by changes in costs in these upstream commodities. Due to fluctuating commodity prices, suppliers are typically reluctant to enter into agreements that maintain pricing over the term of the agreement.
As of December 31, 2024, the Company owned 82 molding presses including 19 in its Columbus, Ohio facility; 24 in its Matamoros, Mexico facility; 18 in its Cobourg, Canada facility; 10 in its Gaffney, South Carolina facility; 5 in its Winona, Minnesota facility; and 6 in its Escobedo, Mexico facility.
As of December 31, 2025, the Company owned 82 molding presses including 18 in its Columbus, Ohio facility; 25 in its Matamoros, Mexico facility; 18 in its Cobourg, Canada facility; 10 in its Gaffney, South Carolina facility; 5 in its Winona, Minnesota facility; and 6 in its Monterrey, Mexico facility.
The 8 Table of Contents ordered backlog of four weeks of expected shipments was approximately $19.1 million (100 % of which the Company shipped during the first month of 2025) and $25.3 million at December 31, 2024 and 2023, respectively.
The 8 Table of Contents ordered backlog of four weeks of expected shipments was approximately $16.8 million, 100% of which the Company shipped during the first month of 2026, an d $19.1 million at December 31, 2025 and 2024, respectively.
Four plant locations making up 67.4% of the workforce are covered by collective bargaining agreements.
Four plant locations making up 65.8% of the workforce are covered by collective bargaining agreements.
The following table provides information related to the Company's sales by country, based on the ship to location of customers' production facilities, for the years ended December 31 (in thousands): 2024 2023 2022 United States $ 187,973 $ 234,504 $ 231,391 Mexico 97,896 105,818 113,245 Canada 11,145 11,980 26,829 Other 5,364 5,436 5,911 Total $ 302,378 $ 357,738 $ 377,376 SEASONALITY & BUSINESS CYCLE The Company's business is affected annually by the production schedules of its customers.
The following table provides information related to the Company's sales by country, based on the ship to location of customers' production facilities, for the years ended December 31 (in thousands): 2025 2024 2023 United States $ 141,143 $ 187,973 $ 234,504 Mexico 109,167 97,896 105,818 Canada 16,703 11,145 11,980 Other 6,785 5,364 5,436 Total $ 273,798 $ 302,378 $ 357,738 SEASONALITY & BUSINESS CYCLE The Company's business is affected annually by the production schedules of its customers.
Total Rewards – Our total rewards package supports an environment where employees want to stay and build their career. We provide fair and competitive compensation and benefits that promote physical, emotional and financial well-being. With a focus on the employee experience, our workplace fosters employee engagement, productivity and morale while encouraging effort, creativity and innovation.
We provide fair and competitive compensation and benefits that promote physical, emotional and financial well-being. With a focus on the employee experience, our workplace fosters employee engagement, productivity and morale while encouraging effort, creativity and innovation.
The Company utilizes behavior-based safety programs at all global facilities as a proactive method of increasing safe behaviors. Organizational Development – The Company offers learning and development opportunities throughout the workforce, including a comprehensive leadership program for high-potential employees identified through our succession and talent planning process.
The Company utilizes behavior-based safety programs at all global facilities as a proactive method of increasing safe behaviors. Organizational Development – The Company provides learning and development opportunities across the workforce, including structured leadership development programs designed to support front-line leaders, emerging leaders, and high-potential employees identified through succession and talent planning processes.
HUMAN CAPITAL MANAGEMENT As of December 31, 2024, the Company employed a total of 1,570 employees, which consisted of 509 employees in the United States, 880 employees in Mexico and 181 employees in Canada. The salary workforce consisted of 335 employees, while 1,235 employees were hourly.
HUMAN CAPITAL MANAGEMENT As of December 31, 2025 , the Company employed a total of 1,239 employees, which consisted of 339 employees in the United States, 727 employees in Mexico and 173 employees in Canada. The salary workforce consisted of 307 employees, while 932 employees were hourly.
Removed
Talent Planning – The Company has developed people management processes that enable us to hire, retain and develop a high-performing workforce. We have performance procedures that align with our organization’s strategic goals and support employee development. Employee engagement surveys are conducted to understand employee satisfaction and provide opportunities to create action plans to improve our workplace culture and employee retention.
Added
These development programs reinforce the Company’s core values, strengthen leadership capability, and support long-term succession planning with individual professional growth. Talent Planning – The Company maintains people management processes designed to attract, develop, and retain a high-performing workforce. Performance management practices align individual objectives with organizational strategic goals and support employee development.
Added
The Company conducts periodic employee engagement surveys along with an online platform to administer ongoing anonymous surveys. These tools provide timely insights that inform action planning, strengthen communication and leadership effectiveness, and support a culture of continuous improvement and employee engagement. Total Rewards – Our total rewards package supports an environment where employees want to stay and build their career.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAny of these events might require us to move closer to our customers, build new facilities, or shift production between our current facilities to meet our customers' needs, resulting in additional cost and expense. 14 Table of Contents Our products may be rendered obsolete or less attractive if there are changes in technology, regulatory requirements, governmental policies or competitive processes.
Biggest changeAdditionally, our competitors could build a facility that is closer to our customers' facilities which may provide them with a geographic advantage. Any of these events might require us to move closer to our customers, build new facilities, or shift production between our current facilities to meet our customers' needs, resulting in additional cost and expense.
The need for additional capital may necessitate that the Company incur further indebtedness or issue additional stock in the equity markets in order to raise needed capital.
The need for additional capital may necessitate that the Company incur further indebtedness or issue additional stock in the equity markets in order to raise the capital needed.
In particular, the continuing adoption or expansion of trade restrictions, the occurrence of a trade war, or other governmental action related to tariffs or trade agreements or policies has the potential to adversely impact demand for our products, our costs and prices, our customers, our suppliers, and the economy, which in turn could have a material adverse effect on our business, operating results, and financial condition.
In particular, the continuing adoption or expansion of trade restrictions, the occurrence of a trade war, or other governmental action (or inaction) related to tariffs or trade agreements or policies has the potential to adversely impact demand for our products, our costs and prices, our customers, our suppliers, and the economy, which in turn could have a material adverse effect on our business, operating results, and financial condition.
A number of factors may adversely affect the labor force available to us or increase labor costs, including high employment levels and government regulations or policies. The increasing competition for highly skilled and talented employees has resulted, and could in the future result, in higher compensation costs resulting in difficulties in maintaining a capable workforce.
A number of factors may adversely affect the labor force available to us or increase labor costs, including high employment levels and government regulations or policies and enforcement. The increasing competition for highly skilled and talented employees has resulted, and could in the future result, in higher compensation costs resulting in difficulties in maintaining a capable workforce.
In addition, our operations are typically seasonal as a result of regular customer maintenance shutdowns, which typically vary from year to year based on production demands and occur in the third and fourth quarter of each calendar year. This seasonality may result in decreased net sales and profitability during the third and fourth fiscal quarters of each calendar year.
In addition, our operations are typically seasonal as a result of regular customer maintenance shutdowns, which typically vary from year to year based on production demands and occur in the third and fourth fiscal quarters of each calendar year. This seasonality may result in decreased net sales and profitability during the third and fourth fiscal quarters of each calendar year.
Weakness in overall economic conditions or in the markets that we serve, or significant reductions by our customers in their inventory levels or future production rates, could result in decreased demand for our products and could have a material adverse effect on our business, results of operations, or financial condition.
Weakness and variability in overall economic conditions or in the markets that we serve, or significant reductions by our customers in their inventory levels or future production rates, could result in decreased demand for our products and could have a material adverse effect on our business, results of operations, or financial condition.
Any acquisitions may present significant challenges for our management due to the increased time and resources required to properly integrate management, employees, information systems, accounting controls, personnel, and administrative functions of the acquired business with those of ours and to manage the combined company on a going forward basis.
Any acquisitions may present significant challenges for our management due to the increased time and resources required to properly integrate management, employees, information systems, accounting controls, personnel, operations, and administrative functions of the acquired business with those of ours and to manage the combined company on a going forward basis.
Additionally, if our controls are not effective in timely identifying the occurrence of material cybersecurity incidents involving our information systems or data, then we may not comply with SEC’s cybersecurity disclosure regulations, which could lead to regulatory action, fines, penalties, inquiries or reprimands that adversely impact our business, as well as lead to a decline in customer engagement or confidence, negative publicity, and possibly an increase in our operating costs to improve monitoring and compliance features relating to cybersecurity.
Additionally, if our controls are not effective in timely identifying the occurrence of material cybersecurity incidents involving our information systems or data, then we may not comply with the SEC’s cybersecurity disclosure regulations, which could lead to regulatory action, fines, penalties, inquiries or reprimands that adversely impact our business, as well as lead to a decline in customer engagement or confidence, negative publicity, 19 Table of Contents and possibly an increase in our operating costs to improve monitoring and compliance features relating to cybersecurity.
A sustained labor shortage, lack of skilled labor, increased turnover or labor cost inflation, as a result of general macroeconomic factors, could lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, which could negatively affect our ability to efficiently operate our manufacturing facilities and overall business and have other adverse effects on our results of operations and financial condition.
A sustained labor shortage, lack of skilled labor, increased turnover or labor cost inflation, as a result of general macroeconomic factors, could lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, which could negatively 12 Table of Contents affect our ability to efficiently operate our manufacturing facilities and overall business and have other adverse effects on our results of operations and financial condition.
Until the timing, scope and extent of any future regulation becomes known, we cannot predict its effect on our cost structure or our operating results, but it is likely our costs will increase in relation to any climate change legislation and regulation concerning greenhouse gases, which could have an adverse effect on our future financial position, results of operations or cash flows.
Until the timing, scope and extent of any future regulation becomes known, we cannot predict its effect on our cost structure or our operating results, but it is likely our costs will 17 Table of Contents increase in relation to any climate change legislation and regulation concerning greenhouse gases, which could have an adverse effect on our future financial position, results of operations or cash flows.
The market for this industry fluctuates in response to factors that are beyond our control, such as: general economic conditions; interest rates; federal 10 Table of Contents and state regulations, including engine emissions regulations, import regulations, tariffs (for example, on products imported into or exported from the U.S., including under U.S. or other trade laws or measures, or other key markets); and other taxes, consumer spending, fuel costs, supply chain constraints, our customers' inventory levels and production rates, and the overall strength of the economy.
The market for this industry fluctuates in response to factors that are beyond our control, such as: general economic conditions; interest rates; federal and state regulations, including engine emissions regulations, import regulations, tariffs (for example, on products imported into or exported from the U.S., including under U.S. or other trade laws or measures, or other key markets); and other taxes, consumer spending, fuel costs, supply chain constraints, our customers' inventory levels and production rates, and the overall strength and variability of the economy.
Unexpected failures of our equipment and machinery may result in production delays, revenue loss, and significant repair costs, as well as injuries to our employees. Any interruption in production capability may require us to make large capital expenditures to remedy the situation, which could have a negative impact on our profitability and cash flows.
Unexpected failures of our equipment and machinery may result in production delays, revenue loss, and significant repair costs, as well as injuries to our employees. Any interruption in production capability may require us to make large capital 13 Table of Contents expenditures to remedy the situation, which could have a negative impact on our profitability and cash flows.
Furthermore, these customers may not continue to do business with us as they have in the past and we may not be able to supply these customers or any of our other customers at current levels. Our business is affected by the cyclical and overall nature of the industries and markets that we serve.
Furthermore, these customers may not continue to do business with us as they have in the past and we may not be able to supply these customers or any of our other customers at current levels. 10 Table of Contents Our business is affected by the cyclical and overall nature of the industries and markets that we serve.
Each year, and more frequently on an interim basis if appropriate, we are required by ASC Topic 350, “Intangibles-Goodwill and Other,” to assess the carrying value of our indefinite lived intangible assets and goodwill to determine whether the carrying value of those assets is impaired.
Each year, and more frequently on an interim basis if appropriate, we are required by ASC Topic 350, “Intangibles-Goodwill and Other,” to assess the carrying value of our indefinite lived intangible assets and goodwill to determine 16 Table of Contents whether the carrying value of those assets is impaired.
OEMs continue to demand and receive price reductions and measurable increases in quality through their use of competitive selection processes, rating programs, and various other arrangements. We may be unable to generate sufficient production cost savings in the future to offset such price reductions.
OEMs continue to demand and receive price reductions and measurable increases in quality through their use of competitive selection processes, rating programs, and various other arrangements. We may be unable 11 Table of Contents to generate sufficient production cost savings in the future to offset such price reductions.
Evolving trade policies could make sourcing and selling products between foreign countries difficult and costly, as the Company and its customers sell foreign produced products into the United States and the Company sources a portion of its raw materials used in production from outside of the U.S.
Evolving U.S. trade policies and foreign relations could make sourcing and selling products between foreign countries difficult and costly, as the Company and its customers sell foreign produced products into the U.S. and the Company sources a portion of its raw materials used in production from outside of the U.S.
As a result, a significant portion of our business and operations is subject to the risk of changes in economic conditions, tax systems, consumer preferences, social conditions, safety and security conditions, and political conditions inherent in Mexico and Canada, including changes in the laws and policies that govern foreign investment, as well as changes in United States laws, policies and regulations relating to foreign trade, investment and relations.
As a result, a significant portion of our business and operations is subject to the risk of changes in economic conditions, tax systems, consumer preferences, social conditions, safety and security conditions, and political conditions inherent in Mexico and Canada, including changes in the laws and policies that govern foreign investment, as well as changes in United States laws, policies and regulations relating to foreign trade, investment and relations with these two countries.
Disruptions in the financial markets could have a material adverse effect on our liquidity and financial condition if our ability to borrow money were to be impaired. Disruptions in the financial markets may also have a material adverse impact on the availability and cost of credit in the future.
Disruptions or unpredictable variability in the financial markets could have a material adverse effect on our liquidity and financial condition if our ability to borrow money were to be impaired. Disruptions or unpredictable variability in the financial markets may also have a material adverse impact on the availability and cost of credit in the future.
The occurrence of such events could have a material adverse effect on our business, financial condition or results of operations. 18 Table of Contents Risks Related to Economic Conditions Economic conditions and disruptions in the financial markets could have an adverse effect on our business, financial condition, and results of operations.
The occurrence of such events could have a material adverse effect on our business, financial condition or results of operations. Risks Related to Economic Conditions Economic conditions and disruptions in the financial markets could have an adverse effect on our business, financial condition, and results of operations.
As a result, if the Company’s operating costs, such as raw material, labor and overhead costs, increase the Company may not be able to increase the price of products sold to customers enough to offset operating costs increases, which could adversely affect our operating results and financial condition.
As a result, if the Company’s operating costs, such as raw material, labor and overhead costs, increase the Company may not be able to increase the price of products sold to customers under such contracts as well as others enough to offset operating costs increases, which could adversely affect our operating results and financial condition.
Although the Company maintains property 16 Table of Contents and business interruption insurance, damage from a weather event, natural disaster, or disruption in the supply chain or customer demand may not be fully covered by our insurance and could cause a material adverse impact on our business.
Although the Company maintains property and business interruption insurance, damage from a weather event, natural disaster, or disruption in the supply chain or customer demand may not be fully covered by our insurance and could cause a material adverse impact on our business.
The loss of any significant portion of sales to any of our significant customers could have a material adverse effect on our business, results of operations, and financial condition. Accounts receivable balances with five customers accounted for 71% of accounts receivable at December 31, 2024.
The loss of any significant portion of sales to any of our significant customers could have a material adverse effect on our business, results of operations, and financial condition. Accounts receivable balances with five customers accounted for 68% of accounts receivable at December 31, 2025.
Changes in U.S. trade policy, including the imposition of new or increased tariffs and the resulting consequences, could have an adverse effect on our business, operating results, and financial condition.
Changes in U.S. trade policy, including the imposition of new or increased tariffs and the resulting consequences, as well as U.S. foreign relations, could have an adverse effect on our business, operating results, and financial condition.
Risks Relating to our Business Our business has concentration risks associated with significant customers. Sales to five customers constituted approximately 69% of our 2024 total sales. No other customer accounted for more than 10% of our total sales for this period.
Risks Relating to our Business Our business has concentration risks associated with significant customers. Sales to five customers constituted approximately 65% of our 2025 total sales. No other customer accounted for more than 10% of our total sales for this period.
The North American heavy and medium-duty truck industry, on which the demand of our products is largely dependent, is highly cyclical. In 2024, approximately 56% of our product sales was in this industry.
The North American heavy and medium-duty truck industry, on which the demand of our products is largely dependent, is highly cyclical. In 2025, approximately 44% of our product sales was in this industry.
As a result, we are subject to the risk of work 12 Table of Contents stoppages and other labor-relations matters. The current Columbus, Ohio, Matamoros, Mexico, Cobourg, Canada, and Escobedo, Mexico union contracts extend through August 9, 2025, December 31, 2025, November 1, 2025 and February 14, 2026, respectively.
As a result, we are subject to the risk of work stoppages and other labor-relations matters. The current Columbus, Ohio, Matamoros, Mexico, Cobourg, Canada, and Monterrey, Mexico union contracts extend through August 12, 2028, December 31, 2026, November 1, 2025 and February 14, 2026, respectively.
We operate manufacturing facilities in Matamoros and Escobedo, Mexico and Cobourg, Canada.
We operate manufacturing facilities in Matamoros and Monterrey, Mexico and Cobourg, Canada.
A catastrophic loss of the use of all or a portion of our facilities due to accident, fire, explosion, or natural disaster, whether short or long-term, could have a material adverse effect on our business, results of operations, or financial condition.
A catastrophic loss of the use of all or a portion of our facilities due to accident, fire, explosion, natural disaster, interruption or stoppage due to regulatory or governmental action, or other reasons, whether short or long-term, could have a material adverse effect on our business, results of operations, or financial condition.
Work stoppages or other labor issues at our facilities or at our customers' facilities, or those of our supplies or vendors, could adversely affect our business, results of operations or financial condition. As of December 31, 2024, unions at our Columbus, Ohio, Matamoros and Escobedo, Mexico, and Cobourg, Canada facilities represented approximately 67.4% of our entire workforce.
Work stoppages or other labor issues at our facilities or at our customers' facilities, or those of our supplies or vendors, could adversely affect our business, results of operations or financial condition. As of December 31, 2025, unions at our Columbus, Ohio, Matamoros and Monterrey, Mexico, and Cobourg, Canada facilities represented approximately 65.8% of our entire workforce.
Such assessment and determination involves significant judgments to estimate the fair value of our reporting unit including estimating future cash flows, near term and long term revenue growth, and determining appropriate discount rates, among other assumptions. As of December 31, 2024, goodwill and indefinite lived intangibles were $21,806,000, or 10.4% of our total assets.
Such assessment and determination involves significant judgments to estimate the fair value of our reporting unit including estimating future cash flows, near term and long term revenue growth, and determining appropriate discount rates, among other assumptions. As of December 31, 2025, goodwill and indefinite lived intangibles were $20,855,000, or 9.1% of our total assets.
Consistent with market conditions in the insurance industry, premiums and deductibles for some of our insurance policies have been increasing and may continue to increase in the future. In some instances, some types of insurance may become available only for reduced amounts of coverage, if at all. In addition, our insurers may challenge coverage for certain claims.
Consistent with market conditions in the insurance industry, premiums and deductibles for some of our insurance policies have been increasing and may continue to increase in the future. In some instances, some types of 18 Table of Contents insurance may become available only for reduced amounts of coverage, if at all.
If we were to incur a significant liability for which we were not fully insured or that our insurers disputed, it could have a material adverse effect on our financial position or results of operations.
In addition, our insurers may challenge coverage for certain claims. If we were to incur a significant liability for which we were not fully insured or that our insurers disputed, it could have a material adverse effect on our financial position or results of operations.
Beginning in the second half of 2024 and continuing through 2026, our business with Volvo, a significant customer accounting for approximately 14% of our 2024 total sales, will begin transitioning from existing production programs that the Company currently supplies to new programs that the Company does not support.
Beginning in the second half of 2024 and continuing through 2026, our business with Volvo, a significant customer accounting for approximately 14% of our 2024 total sales, transitioned from production programs that the Company supplied to new programs that the Company does not support.
Such warranty claims may result in costly product recalls, significant repair costs, and damage to our reputation, all of which would adversely affect our business, results of operations or financial condition. Our insurance coverage may be inadequate to protect against the potential hazards to our business.
Such warranty claims may result in costly product recalls, significant repair costs, and damage to our reputation, all of which would adversely affect our business, results of operations or financial condition.
Any such charges could materially adversely affect our financial results in the periods in which they are recorded. 15 Table of Contents Our ability to maintain effective internal control over financial reporting may be insufficient to allow us to accurately report our financial results or prevent fraud, and this could cause our financial statements to become materially misleading and adversely affect the trading price of our common stock.
Our ability to maintain effective internal control over financial reporting may be insufficient to allow us to accurately report our financial results or prevent fraud, and this could cause our financial statements to become materially misleading and adversely affect the trading price of our common stock.
If our costs are subject to continuing significant inflationary pressures and/or imposition of tariffs, we may not be able to fully offset such higher costs through price increases. Our inability to do so could harm our results of operations and financial condition. Long-term fixed price customer contracts could adversely impact operating results in an inflationary economy.
If our costs are subject to continuing significant inflationary pressures and/or imposition of tariffs, we may not be able to fully offset such higher costs through price increases. Our inability to do so, or any significant delay in our ability to act, could materially harm our results of operations and financial condition.
During the year ended December 31, 2024, the Company repurchased 172,043 common shares under the stock repurchase program and had a remaining repurchase authorization of $4,561,000 as of December 31, 2024.
During the year ended December 31, 2025, the Company repurchased 201,999 common shares under the stock repurchase program and had a remaining repurchase authorization of $1,387,000 as of December 31, 2025.
If operating earnings fall below forecasted operating earnings, we would perform an interim or annual goodwill impairment analysis. Should that analysis conclude that the reporting unit’s fair value were to be below carrying value a goodwill impairment charge would be necessary.
If operating earnings fall below forecasted operating earnings, we would perform an interim or annual goodwill impairment analysis. Should that analysis conclude that the reporting unit’s fair value were to be below carrying value a goodwill impairment charge would be necessary. Any such charges could materially adversely affect our financial results in the periods in which they are recorded.
As a result, we may not realize the anticipated operating results related to new business awards. We will continue to pursue, and may be awarded, new business from existing or new customers.
All costs may not be accurately identified during the Company's quoting process and the expected level of manufacturing efficiency may not be achieved. As a result, we may not realize the anticipated operating results related to new business awards. We will continue to pursue, and may be awarded, new business from existing or new customers.
Cybersecurity incidents across industries, including ours, are increasing in sophistication and frequency and may range from uncoordinated individual attempts to measures targeted specifically at us.
Cybersecurity incidents may threaten our confidential information, disrupt operations and result in harm to our reputation and adversely impact our business and financial performance. Cybersecurity incidents across industries, including ours, are increasing in sophistication and frequency and may range from uncoordinated individual attempts to measures targeted specifically at us.
Changes in technology, regulatory requirements, and competitive processes may render certain products obsolete or less attractive. Future chemical regulations may restrict our ability to manufacture products, cause us to incur substantial expenditures to comply with them, and subject us to liability for adverse environmental or health effects linked to the manufacture of our products.
Future chemical regulations may restrict our ability to manufacture products, cause us to incur substantial expenditures to comply with them, and subject us to liability for adverse environmental or health effects linked to the manufacture of our products. Failure to comply with future regulations and policies may subject us to penalties or other enforcement actions.
Shifting production, moving production lines, or opening new locations could result in significant costs required for capital investment, transfer expenses, and operating costs. Additionally, OEMs have generally required component suppliers to provide more design engineering input at earlier stages of the product development process, the costs of which have, in some cases, been absorbed by the suppliers.
Additionally, OEMs have generally required component suppliers to provide more design engineering input at earlier stages of the product development process, the costs of which have, in some cases, been absorbed by the suppliers.
OEMs may also seek to save costs by purchasing components from suppliers that are geographically closer to their production facilities or relocating production to locations with lower cost structures and purchasing components from suppliers with lower production costs. 11 Table of Contents These decisions by OEMs could require us to shift production between our facilities, move production lines between our facilities, or open new facilities to remain competitive.
OEMs may also seek to save costs by purchasing components from suppliers that are geographically closer to their production facilities or relocating production to locations with lower cost structures and purchasing components from suppliers with lower production costs.
In addition, even if we are able to invest sufficient resources, these investments may not generate net sales that exceed our expenses, generate any net sales at all, or result in any commercially acceptable products.
In addition, even if we are able to invest sufficient resources, these investments may not generate net sales that exceed our expenses, generate any net sales at all, or result in any commercially acceptable products. 14 Table of Contents We may not achieve expected efficiencies related to the proximity of our customers' production facilities to our manufacturing facilities, or with respect to existing or future production relocation plans.
In order to obtain new business in a competitive environment, the Company enters into long-term contracts that fix the customer product price and requires the Company to accept all product orders pursuant to such contracts. These fixed price customer contracts allow for certain price increases but may not provide for recovery of all of the Company's cost increases.
Long-term fixed price customer contracts could adversely impact operating results in an inflationary economy. In order to obtain new business in a competitive environment, the Company enters into long-term contracts that fix the customer product price and requires the Company to accept all product orders pursuant to such contracts.
If we are unable to identify or compensate for any one of these changes it may have a material adverse effect on our business, results of operations, or financial condition. Financial and Accounting Risks Fluctuations in foreign currency exchange rates could adversely affect our results of operations, cash flow, liquidity, or financial condition.
Our ability to anticipate changes in these areas will be a significant factor in our ability to remain competitive. If we are unable to identify or compensate for any one of these changes it may have a material adverse effect on our business, results of operations, or financial condition.
We may not realize the sales or operating results that we anticipate from new business awards, and we may experience difficulties in meeting the production demands of new business awards. 13 Table of Contents The success of our business relies on our ability to produce products which meet the quality, performance, and price expectations of our customers.
Expected future sales from business awards may not materialize. We may not realize the sales or operating results that we anticipate from new business awards, and we may experience difficulties in meeting the production demands of new business awards.
Our ability to recognize profit is largely dependent upon accurately identifying the costs associated with the manufacturing of our products and executing the manufacturing process in a cost-effective manner. All costs may not be accurately identified during the Company's quoting process and the expected level of manufacturing efficiency may not be achieved.
The success of our business relies on our ability to produce products which meet the quality, performance, and price expectations of our customers. Our ability to recognize profit is largely dependent upon accurately identifying the costs associated with the manufacturing of our products and executing the manufacturing process in a cost-effective manner.
Outcomes from examinations may have a negative impact on our future financial condition and operating results. Cybersecurity incidents may threaten our confidential information, disrupt operations and result in harm to our reputation and adversely impact our business and financial performance.
Outcomes from examinations may have a negative impact on our future financial condition and operating results. We may use artificial intelligence in our business and operations, and challenges with effectively managing its use could harm our business and expose us to costly liability.
If any of our customers were to move or if nearby facilities are closed or impaired, that may impact our ability to remain competitive. Additionally, our competitors could build a facility that is closer to our customers' facilities which may provide them with a geographic advantage.
Certain facilities are located in close proximity to our customers in order to minimize both our customers' and our own costs. If any of our customers were to move or if nearby facilities are closed or impaired, that may impact our ability to remain competitive.
Removed
Expected future sales from business awards may not materialize.
Added
These fixed price customer contracts allow for certain price increases but may not provide for recovery of all of the Company's cost increases.
Removed
We may not achieve expected efficiencies related to the proximity of our customers' production facilities to our manufacturing facilities, or with respect to existing or future production relocation plans. Certain facilities are located in close proximity to our customers in order to minimize both our customers' and our own costs.
Added
These decisions by OEMs could require us to shift production between our facilities, move production lines between our facilities, or open new facilities to remain competitive. Shifting production, moving production lines, or opening new locations could result in significant costs required for capital investment, transfer expenses, and operating costs.
Removed
Failure to comply with future regulations and policies may subject us to penalties or other enforcement actions. Our ability to anticipate changes in these areas will be a significant factor in our ability to remain competitive.
Added
Our products may be rendered obsolete or less attractive if there are changes in technology, regulatory requirements, governmental policies or competitive processes. Changes in technology, regulatory requirements, and competitive processes may render certain products obsolete or less attractive.
Removed
Certain senior management employees have entered into potentially costly severance arrangements with us if terminated by the employee for good reason. We have entered into executive employment agreements with executive officers that provide for significant severance payments in the event such employee's employment with us is terminated by the employee for good reason (as defined in the employment agreement).
Added
We may incur costs, time, and other resources by developing strategies, plans, and programs to expand and grow our business which may produce short term success but not achieve the targeted or promoted growth, revenue or profitability projections, estimates or targets that we set and announce which may negatively impact our financial results and not achieve some or all of the expected benefits of these strategies, plans, or programs.
Removed
Good reason includes one or more of the following occurring in the ordinary course of business or within one year of a change in control: (i) a material reduction in base salary, (ii) a material diminution in the executive's position and/or duties, (iii) a material breach of the employment agreement by the person or other entity then controlling the Company, or (iv) a disavowal of the employment agreement by the person or other entity then controlling the Company.
Added
Our ability to achieve our business and financial objectives is subject to a variety of factors, many of which are beyond our control.
Removed
A change in control occurs when (a) one Person (as defined in the employment agreement), or more than 17 Table of Contents one Person acting as a group, acquires ownership of stock of the Company that, together with the stock held by such Person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company, (b) a majority of the members of the Board are replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the Board before the date of appointment or election, or (c) the sale of all or substantially all of the Company’s assets.
Added
For example, we may not be successful in implementing our strategy or plans for growth and expansion if unforeseen factors emerge diminishing the current levels or any future expected growth in our business, or we experience increased pressure on our margins.
Removed
These agreements would make it costly for the employment of certain of our senior management employees to be terminated and such costs may also discourage potential acquisition proposals, which may negatively affect our stock price.
Added
Furthermore, our future growth is dependent in part on us making the right investments at the right time in people, technology, product development, manufacturing capacity and/or locations, and to expand into new markets where our business and products will thrive.
Added
If we fail to realize expected rates of return on our investments, we may incur losses on such investments to implement or growth strategies or plans and be unable to timely redeploy the invested capital to take advantage of other markets, potentially resulting in lost market share to our competitors and unplanned losses.
Added
As a result, costs and expenses relating to such growth strategies and plans may vary significantly from year to year depending on the scope of such activities. Such costs and expenses could adversely impact our financial results. Failure to manage periods of growth or contraction may seriously harm our business.
Added
Our industry frequently sees periods of expansion and contraction which require companies to adjust to customers’ needs and market demands. We regularly contend with these issues and must carefully manage our business to meet customer and market requirements.
Added
If we fail to manage these growth and contraction decisions effectively, we may find ourselves with either excess or insufficient resources and our business and our profitability could suffer as a result.
Added
Periods of contraction or reduced net sales, or other factors negatively affecting particular markets, require us to assess whether facilities remain viable, whether staffing levels need to be reduced, and how to respond to changing levels of customer demand.
Added
While maintaining excess capacity or higher levels of employment entails short-term costs, reductions in capacity or employment could impair our ability to respond to new opportunities and programs, market improvements or to maintain customer relationships. Our decisions to reduce costs and capacity can affect our short-term and long-term results and result in restructuring charges.
Added
Expansions, including the transfer of operations to other facilities and aggressive growth strategies, include the risk of additional costs and start-up inefficiencies. If we are unable to effectively manage our expansion projects or related anticipated net sales are not realized, our operating results could be materially adversely affected.
Added
We may be unable to successfully execute and realize the expected financial benefits from strategic initiatives. 15 Table of Contents From time to time, our business has engaged in strategic initiatives for growth and other objectives, and such activities may occur in the future.
Added
While we expect meaningful financial benefits from our strategic initiatives, we may not realize the full benefits expected within the anticipated timeframe. Adverse effects from strategy-driven organizational or operational changes or initiatives could interfere with our realization of anticipated synergies, customer service improvements and cost savings from these strategic initiatives.
Added
Additionally, our ability to fully realize the benefits and implement strategic initiatives may be limited by certain contractual commitments. Moreover, we may incur substantial expenses in connection with the execution of strategic plans in excess of what is forecasted.
Added
Further, strategic initiatives can be a complex and time-consuming process that can place substantial demands on management, which could divert attention from other business priorities or disrupt our daily operations. Any of these failures could materially adversely affect our business, financial condition, results of operations and cash flows, which could constrain our liquidity.
Added
Customers may cancel, delay or change the scope of projects or orders. As a result, unexpected changes or fluctuation in our backlog can impact our on production schedules and implementation of our production processes which can have an adverse effect on our financial results and not be indicative of our future revenue or financial performance..
Added
Customers may cancel, delay or change the scope of projects or orders for reasons beyond our control.
Added
If a customer elects to cancel an order, we may not realize the full amount of revenues included in our backlog and the typical timeline for our ordered backlog of expected shipments may be extended for a period of time that impacts our revenues and productions schedules which can have an adverse impact on our financial performance and revenue projections.
Added
Furthermore, if we receive relatively large orders in any given quarter or time period, fluctuations in the levels of our quarterly backlog can result because the backlog in that quarter may reach levels that may not be sustained in subsequent quarters.
Added
As a result, our backlog may not be indicative of our future revenues and there is no guarantee that we will ship all orders that comprise our backlog. Financial and Accounting Risks Fluctuations in foreign currency exchange rates could adversely affect our results of operations, cash flow, liquidity, or financial condition.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changePlease refer to the risk factor titled "Cybersecurity incidents may threaten our confidential information, disrupt operations and result in harm to our reputation and adversely impact our business and financial performance." See Part I, Item 1A for further information regarding cybersecurity risks and potential impacts on our business and results of operations.
Biggest changePlease refer to the risk factor titled "Cybersecurity incidents may threaten our 20 Table of Contents confidential information, disrupt operations and result in harm to our reputation and adversely impact our business and financial performance." See Part I, Item 1A for further information regarding cybersecurity risks and potential impacts on our business and results of operations.
Board oversight 19 Table of Contents While management is responsible for the day-to-day management of cybersecurity risks, our Board maintains principal oversight responsibility for our enterprise risk management, including cybersecurity.
Board oversight While management is responsible for the day-to-day management of cybersecurity risks, our Board maintains principal oversight responsibility for our enterprise risk management, including cybersecurity.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeMINE SAFETY DISCLOSURE None. 20 Table of Contents PART II
Biggest changeMINE SAFETY DISCLOSURE None. 21 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total number of shares purchased Average price paid per share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Amount that May Yet be Purchased Under the Plans or Programs (1) October 1 to 31, 2024 — $ — — $ 5,136,000 November 1 to 30, 2024 — — — 5,136,000 December 1 to 31, 2024 36,170 15.95 36,170 4,561,000 Total 36,170 $ 15.95 36,170 — 1.
Biggest changePeriod Total number of shares purchased Average price paid per share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Amount that May Yet be Purchased Under the Plans or Programs (1) October 1 to 31, 2025 24,526 $ 18.46 24,526 $ 1,859,000 November 1 to 30, 2025 20,978 18.10 20,978 1,479,000 December 1 to 31, 2025 4,911 18.61 4,911 1,387,000 Total 50,415 $ 18.33 50,415 — 1.
The stock repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be suspended or terminated at any time at the Company’s discretion. ITEM 6. [RESERVED] 21 Table of Contents
The stock repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be suspended or terminated at any time at the Company’s discretion. ITEM 6. [RESERVED] 22 Table of Contents
We repurchased 244,701 shares of our common stock during the year ended December 31, 2024. The following table provides information with respect to repurchases of common stock by us and our “affiliated purchasers” (as defined by Rule 10b-18(a)(3) under the Exchange Act) during the three months ended December 31, 2024.
We repurchased 242,952 shares of our common stock during the year ended December 31, 2025. The following table provides information with respect to repurchases of common stock by us and our “affiliated purchasers” (as defined by Rule 10b-18(a)(3) under the Exchange Act) during the three months ended December 31, 2025.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES The Company's common stock is traded on the NYSE American LLC under the symbol “CMT”. The Company's common stock was held by 293 holders of record on March 10, 2025.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES The Company's common stock is traded on the NYSE American LLC under the symbol “CMT”. The Company's common stock was held by 280 holders of record on March 09, 2026.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [RESERVED] 21 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 22 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 30 Item 8. Financial Statements and Supplementary Data (PCAOB 173) 31 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 60 Item 9A. Controls and Procedures 61 Item 9B.
Biggest changeItem 6. [RESERVED] 22 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 31 Item 8. Financial Statements and Supplementary Data (PCAOB 173) 32 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 62 Item 9A. Controls and Procedures 63 Item 9B.

Item 7. Management's Discussion & Analysis

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

48 edited+6 added−9 removed54 unchanged
Biggest changeThe Company anticipates spending approximately $10,000,000 to $12,000,000 on property, plant and equipment purchases for all of the Company's operations for the year ended December 31, 2025. The Company plans on using cash on hand and cash from operations to finance capital expenditures. At December 31, 2024, purchase commitments for capital expenditures in progress were approximately $2,802,000.
Biggest changeAt December 31, 2025, purchase commitments for capital expenditures in progress were approximately $13,766,000. The Company anticipates spending approximately $25,000,000 to $30,000,000 during 2026 on property, plant and equipment purchases for all of the Company's operations. Included in the Company's anticipated spending in 2026 is approximately $18,000,000 to $20,000,000 for the Mexico expansion project.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS DESCRIPTION OF THE COMPANY Core Molding Technologies and its subsidiaries operate in the engineered materials market as one operating segment as a molder of thermoplastic and thermoset structural products. During the year ended December 31, 2024 the Company's operating segment consisted of one component reporting unit.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS DESCRIPTION OF THE COMPANY Core Molding Technologies and its subsidiaries operate in the engineered materials market as one operating segment as a molder of thermoplastic and thermoset structural products. During the year ended December 31, 2025 the Company's operating segment consisted of one component reporting unit.
The Huntington Credit Agreement contains certain customary representations and warranties, conditions, affirmative and negative covenants and events of default. The Company is in compliance with such covenants as of December 31, 2024. Voluntary prepayments of amounts outstanding under the Huntington Loans are permitted at any time without premium or penalty.
The Huntington Credit Agreement contains certain customary representations and warranties, conditions, affirmative and negative covenants and events of default. The Company is in compliance with such covenants as of December 31, 2025. Voluntary prepayments of amounts outstanding under the Huntington Loans are permitted at any time without premium or penalty.
As of December 31, 2024 and 2023, the Company had no significant off-balance sheet arrangements. CRITICAL ACCOUNTING ESTIMATES Management’s Discussion and Analysis of Financial Condition and Results of Operations discuss the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.
As of December 31, 2025 and 2024, the Company had no significant off-balance sheet arrangements. CRITICAL ACCOUNTING ESTIMATES Management’s Discussion and Analysis of Financial Condition and Results of Operations discuss the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.
Daily Simple SOFR means, for any day (a “SOFR Rate Day”), a rate per annum equal to the greater of (a) SOFR for the day (such day, the “SOFR Determination Date”) that is five (5) U.S. 25 Table of Contents Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S.
Daily Simple SOFR means, for any day (a “SOFR Rate Day”), a rate per annum equal to the greater of (a) SOFR for the day (such day, the “SOFR Determination Date”) that is five (5) U.S. 26 Table of Contents Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S.
Huntington Revolving Loan Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company a revolving loan commitment (the “Huntington Revolving Loan”) of $25,000,000 ($13,689,000 of which was advanced to the Company on July 22, 2022). The Company has $25,000,000 of available revolving loans of which none is outstanding as of December 31, 2024.
Huntington Revolving Loan Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company a revolving loan commitment (the “Huntington Revolving Loan”) of $25,000,000 ($13,689,000 of which was advanced to the Company on July 22, 2022). The Company has $25,000,000 of available revolving loans of which none is outstanding as of December 31, 2025.
There was no impairment of the Company's long-lived assets for the years ended December 31, 2024, 2023, and 2022. Goodwill The purchase consideration of acquired businesses have been allocated to the assets and liabilities acquired based on the estimated fair values on the respective acquisition dates.
There was no impairment of the Company's long-lived assets for the years ended December 31, 2025, 2024, and 2023. Goodwill The purchase consideration of acquired businesses have been allocated to the assets and liabilities acquired based on the estimated fair values on the respective acquisition dates.
Huntington Capex Loan Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company secured Capex loan (the “Huntington Capex Loan”) in the maximum aggregate principal amount of $25,000,000 (none of which was advanced to the Company on July 22, 2022 and through December 31, 2024).
Huntington Capex Loan Pursuant to the terms of the Huntington Credit Agreement, Huntington made available to the Company secured Capex loan (the “Huntington Capex Loan”) in the maximum aggregate principal amount of $25,000,000 (none of which was advanced to the Company on July 22, 2022 and through December 31, 2025).
Actual results may differ from these estimates under different assumptions and conditions. Management believes the following critical accounting policies, among others, affect its more significant judgments and estimates used in the preparation of its consolidated financial statements. Accounts Receivable Allowances Management maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.
Actual results may differ from these estimates under different assumptions and conditions. Management believes the following critical accounting policies, among others, affect its more significant judgments and estimates used in the preparation of its consolidated financial statements. Accounts Receivable Allowances Management maintains allowances for credit losses resulting from the inability of its customers to make required payments.
The Company believes that the deferred tax assets associated with the Mexican and Canadian tax jurisdictions are more-likely-than-not to be realizable based on estimates of future taxable income. Management recognizes the financial statement effects of a tax position when it is more likely than not the position will be sustained upon examination.
The Company believes that the net deferred tax assets associated with the Mexican and Canada tax jurisdictions are more-likely-than-not to be realizable based on estimates of future taxable income. Management recognizes the financial statement effects of a tax position when it is more likely than not the position will be sustained upon examination.
Shelf Registration On December 22, 2023 the Company filed a universal shelf Registration Statement on Form S-3 (the “Registration Statement”) with the SEC in accordance with the Securities Act of 1933, as amended, which became effective on January 8, 2024. The Registration Statement replaces an existing shelf Registration Statement which expired on December 16, 26 Table of Contents 2023.
Shelf Registration On December 22, 2023 the Company filed a universal shelf Registration Statement on Form S-3 (the “Registration Statement”) with the SEC in accordance with the Securities Act of 1933, as amended, which became effective on January 8, 2024. The Registration Statement replaces an existing shelf Registration Statement which expired on December 16, 2023.
The Company's largest market, North American truck, which is highly cyclical, accounted for 56%, 52%, and 45% of the Company’s product revenue for the years ended December 31, 2024, 2023, and 2022, respectively. Operating performance is dependent on the Company’s ability to manage changes in input costs for items such as raw materials, labor, and overhead operating costs.
The Company's largest market, North American truck, which is highly cyclical, accounted for 44%, 56%, and 52% of the Company’s product revenue for the years ended December 31, 2025, 2024, and 2023, respectively. Operating performance is dependent on the Company’s ability to manage changes in input costs for items such as raw materials, labor, and overhead operating costs.
The Company had a liability for post-retirement healthcare benefits based on actuarial computed estimates of $3,298,000 at December 31, 2024 and $3,116,000 at December 31, 2023. Revenue Recognition The Company historically has recognized revenue from two streams, product revenue and tooling revenue. Product revenue is earned from the manufacture and sale of sheet molding compound and thermoset and thermoplastic products.
The Company had a liability for post-retirement healthcare benefits based on actuarial computed estimates of $3,287,000 at December 31, 2025 and $3,298,000 at December 31, 2024. Revenue Recognition The Company historically has recognized revenue from two streams, product revenue and tooling revenue. Product revenue is earned from the manufacture and sale of sheet molding compound and thermoset and thermoplastic products.
The Company performed its annual impairment test for the years end December 31, 2024 and 2023, and determined there was no impairment of the Company’s goodwill.
The Company performed its annual impairment test for the years end December 31, 2025 and 2024, and determined there was no impairment of the Company’s goodwill.
The terms of any securities offered under the Registration Statement and intended use of proceeds will be established at the times of the offerings and will be described in prospectus supplements filed with the SEC at the times of the offerings. The Registration Statement has a three-year term.
The terms of any securities offered under the Registration Statement and intended use of 27 Table of Contents proceeds will be established at the times of the offerings and will be described in prospectus supplements filed with the SEC at the times of the offerings. The Registration Statement has a three-year term.
Under this agreement, the Company will pay a fixed SOFR rate of 2.95% to the swap counterparty in exchange for the Term Loans daily variable SOFR. The fair value of the interest rate swap was an asset of $491,000 at December 31, 2024.
Under this agreement, the Company will pay a fixed SOFR rate of 2.95% to the swap counterparty in exchange for the Term Loans daily variable SOFR. The fair value of the interest rate swap was an asset of $23,000 at December 31, 2025.
The Company has recorded an allowance for slow moving and obsolete inventory of $1,392,000 at December 31, 2024 and $671,000 at December 31, 2023. Long-Lived Assets Long-lived assets consist primarily of property, plant and equipment and finite-lived intangibles.
The Company has recorded an allowance for slow moving and obsolete inventory of $1,137,000 at December 31, 2025 and $1,392,000 at December 31, 2024. Long-Lived Assets Long-lived assets consist primarily of property, plant and equipment and finite-lived intangibles.
The interest rate for the Huntington Term Loan was 6.11% as of December 31, 2024. Interest Rate Swap Agreement The Company entered into an interest rate swap agreement that became effective July 22, 2022 and continues through July 2027, which was designed as a cash flow hedge for an initial aggregate amount of $25,000,000 of the Huntington Term Loan.
The interest rate for the Huntington Term Loan was 5.46% as of December 31, 2025. Interest Rate Swap Agreement The Company entered into an interest rate swap agreement that became effective July 22, 2022 and continues through July 2027, which was designed as a cash flow hedge for an initial aggregate amount of $25,000,000 of the Huntington Term Loan.
The interest rate for the Huntington Revolving Loan was 6.33% as of December 31, 2024. The Huntington Credit Agreement makes available to the Company a revolving commitment in the maximum amount of $25,000,000 at the Company’s option at any time during the five-year period following the closing.
The interest rate for the Huntington Revolving Loan was 5.46% as of December 31, 2025. The Huntington Credit Agreement makes available to the Company a revolving commitment in the maximum amount of $25,000,000 at the Company’s option at any time during the five-year period following the closing.
Recent Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional 29 Table of Contents information on income taxes paid.
Recent Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional disclosures regarding income taxes paid.
Management also records estimates for customer returns and deductions, discounts offered to customers, and for price adjustments. Should customer returns and deductions, discounts, and price adjustments fluctuate from the estimated amounts, additional allowances may be required. The Company had an allowance for estimated chargebacks of $227,000 at December 31, 2024 and $138,000 at December 31, 2023.
Management also records estimates for customer returns and deductions, discounts offered to customers, and for price 28 Table of Contents adjustments. Should customer returns and deductions, discounts, and price adjustments fluctuate from the estimated amounts, additional allowances may be required. The Company had an allowance for estimated chargebacks of $212,000 at December 31, 2025 and $227,000 at December 31, 2024.
In connection with the credit agreement, the Company incurred debt origination fees of $402,000 related to the Huntington Credit Agreement, which is being amortized over the life of the Credit Agreement. The aggregate unamortized deferred financing fees as of December 31, 2024 totaled $210,000.
In connection with the credit agreement, the Company incurred debt origination fees of $402,000 related to the Huntington Credit Agreement, which is being amortized over the life of the Credit Agreement. The aggregate unamortized deferred financing fees as of December 31, 2025 and 2024 was $129,000 and $210,000, respectively.
As of December 31, 2024, the Company had a valuation allowance of $1,265,000 against the deferred tax asset related to local tax positions in the United States, due to cumulative losses over the last three years and uncertainty related to the Company’s ability to realize the deferred assets.
As of December 31, 2025, the Company had a valuation allowance of $1,327,000 against the deferred tax asset related to local (city) jurisdiction tax positions, due to cumulative losses over the last three years in the local jurisdiction and uncertainty related to the Company’s ability to realize the deferred assets.
Cash activity primarily consisted of the purchase of treasury stock related to the Company's stock buy back plan of $2,939,000, purchase of treasury stock of $1,440,000 in exchange for payment of taxes related to net share settlements of equity awards and repayments of long-term debt of $1,548,000.
Cash activity primarily consisted of the purchase of treasury stock related to the Company's stock buy back plan of $3,174,000, repayments of long-term debt of $1,887,000 and purchase of treasury stock of $601,000 in exchange for payment of taxes related to net share settlements of equity awards.
Cash used in financing activities totaled $5,927,000 for the year ended December 31, 2024.
Cash used in financing activities totaled $5,662,000 for the year ended December 31, 2025.
At December 31, 2024, the Company had $41,803,000 of cash on hand, an available revolving line of credit of $25,000,000 and capex line of credit of $25,000,000.
At December 31, 2025, the Company had $38,058,000 of cash on hand, an available revolving line of credit of $25,000,000 and capex line of credit of $25,000,000.
As of December 31, 2024 the Company had a net deferred tax asset of $1,454,000 and $183,000 related to tax positions in Mexico and Canada and deferred tax liabilities of $1,219,000 related to tax positions in the United States.
As of December 31, 2025 the Company had a net deferred tax asset of $1,402,000 and $221,000 related to tax positions in Mexico and Canada and deferred tax liabilities of $1,035,000 related to tax positions in the United States.
The Company evaluates provisions and deferred tax assets quarterly to determine if adjustments to our valuation allowance are required based on the consideration of all available evidence.
Management makes assumptions, judgments, and estimates to determine our current and deferred tax provision and also the deferred tax assets and liabilities. The Company evaluates provisions and deferred tax assets quarterly to determine if adjustments to our valuation allowance are required based on the consideration of all available evidence.
As of December 31, 2024, the Company had outstanding foreign exchange contracts and interest rate swaps with notional amounts totaling $29,668,000 and $21,719,000, respectively. At December 31, 2023, the Company had outstanding foreign exchange contracts and interest rate swaps with notional amounts totaling $9,195,000 and $23,229,000, respectively.
As of December 31, 2025, the Company had outstanding foreign exchange contracts and interest rate swaps with notional amounts totaling $66,856,000 and $19,843,000, respectively. At December 31, 2024, the Company had outstanding foreign exchange contracts and interest rate swaps with notional amounts totaling $29,668,000 and $21,719,000, respectively.
Included in total sales were tooling project sales of $10,363,000 and $18,675,000 for the years ended December 31, 2023 and 2022, respectively. These sales are sporadic in nature and fluctuate in regard to scope and related revenue on a period-to-period basis.
Included in total sales were tooling project sales of $41,593,000 and $11,286,000 for the years ended December 31, 2025 and 2024, respectively. These sales are sporadic in nature and fluctuate in regard to scope and related revenue on a period-to-period basis.
If the financial condition of the Company’s customers were to deteriorate, resulting in an 27 Table of Contents impairment of their ability to make payments, additional allowances may be required. The Company determined that no allowance for doubtful accounts was needed at December 31, 2024 or December 31, 2023, respectively.
If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. The Company determined that $58,000 allowance for credit losses was needed at December 31, 2025 and no allowances for credit losses was needed at December 31, 2024.
Business Outlook Looking forward, based on industry analyst projections, customer forecasts, cyclical demand, and customer programs ramping down throughout 2025, offset by anticipated program launches and price changes, the Company expects revenues for first half of the calendar year 2025 to decrease by approximately 5 to 10 percent as compared to 2024, but remain flat for the full year 2025 as compared to 2024.
Business Outlook Looking forward, based on industry analyst projections, customer forecasts, cyclical demand, anticipated program launches and price changes, the Company expects revenues for the calendar year 2026 to increase by approximately 0 to 5 percent as compared to 2025 and the second half of 2026 to be greater than the first half of 2026.
Cash used in investing activities totaled $11,525,000 for the year ended December 31, 2024, related to purchases of property, plant and equipment for additional capacity, automation, new programs and equipment improvements at the Company’s production facilities.
Cash used in investing activities totaled $17,268,000 for the year ended December 31, 2025, of which $10,809,000 relates to purchases of property, plant and equipment for additional capacity, automation, new programs and equipment improvements at the Company’s production facilities and $6,459,000 relates to the Mexico expansion project.
The Company has recorded an estimated liability for self-insured medical, dental and vision claims incurred but not reported and worker’s compensation claims incurred but not reported at December 31, 2024 and December 31, 2023 of $1,087,000 and $988,000, respectively, included within the Other Current Liabilities on the Company's Consolidated Balance Sheets. 28 Table of Contents Post-Retirement Benefits Management records an accrual for post-retirement costs associated with the health care plan sponsored by the Company for certain retirees.
The Company has recorded an estimated liability for self-insured medical, dental and vision claims incurred but not reported and worker’s compensation claims incurred but not reported at December 31, 2025 and December 31, 2024 of $845,000 and $1,087,000, respectively. The accrual was included within the Other Current Liabilities on the Company's Consolidated Balance Sheets.
Should actual results differ from the assumptions used to determine the reserves, additional provisions may be required. In particular, increases in future healthcare costs above the assumptions could have an adverse effect on the Company's operations. The effect of a change in healthcare costs is described in Note 14 - Post Retirement Benefits .
In particular, increases in future healthcare costs above the assumptions could have an adverse effect on 29 Table of Contents the Company's operations. The effect of a change in healthcare costs is described in Note 14 - Post Retirement Benefits .
A decrease in working capital of $4,064,000 resulted in an increase in cash. The increase in cash from working capital was primarily related to net changes in accounts receivable, inventory and other prepaid assets, offset by net changes in accounts payable and other accrued liabilities.
The decrease in cash from working capital was primarily related to net changes in accounts payable, inventory and prepaid and other assets.
Product sales, excluding tooling project sales, for the year ended December 31, 2023 were $347,375,000 compared to $358,701,000 for the same period in 2022.
Product sales, excluding tooling project sales, for the year ended December 31, 2025 were $232,205,000 compared to $291,092,000 for the same period in 2024.
The decrease was primarily related to decreases in net income of $7,025,000, foreign currency hedges of $2,674,000, and post retirement benefit plan adjustments of $2,747,000. 23 Table of Contents 2023 Compared to 2022 Net sales for the years ended December 31, 2023 and 2022 totaled $357,738,000 and $377,376,000, respectively.
The increase was primarily related to increase of foreign currency hedges of $4,605,000 offset by decreases in net income of $2,104,000. 24 Table of Contents 2024 compared to 2023 Net sales for the years ended December 31, 2024 and 2023 totaled $302,378,000 and $357,738,000, respectively.
The following table provides aggregated information about the maturities of contractual obligations and other long-term liabilities as of December 31, 2024: 2025 2026 2027 2028 2029 and after Total Long-term debt $ 1,886,000 $ 2,136,000 $ 17,708,000 $ — $ — $ 21,730,000 Interest (A) 980,000 891,000 596,000 — — 2,467,000 Operating lease obligations 1,267,000 773,000 262,000 — — 2,302,000 Contractual commitments for capital expenditures $ 2,802,000 — — — — 2,802,000 Post retirement benefits 146,000 164,000 180,000 189,000 2,619,000 3,298,000 Total $ 7,081,000 $ 3,964,000 $ 18,746,000 $ 189,000 $ 2,619,000 $ 32,599,000 (A) Estimated future interest payments based on the effective interest rate as of December 31, 2024.
The following table provides aggregated information about the maturities of contractual obligations and other long-term liabilities as of December 31, 2025: 2026 2027 2028 2029 2030 and after Total Long-term debt $ 2,135,000 $ 17,708,000 $ — $ — $ — $ 19,843,000 Interest (A) 891,000 596,000 — — — 1,487,000 Operating lease obligations 2,599,000 2,311,000 2,355,000 2,382,000 9,781,000 19,428,000 Contractual commitments for capital expenditures $ 13,766,000 — — — — 13,766,000 Post retirement benefits 182,000 176,000 180,000 184,000 2,565,000 3,287,000 Total $ 19,573,000 $ 20,791,000 $ 2,535,000 $ 2,566,000 $ 12,346,000 $ 57,811,000 (A) Estimated future interest payments based on the effective interest rate as of December 31, 2025.
Cash provided by operating activities totaled $35,151,000 for the year ended December 31, 2024. Net income of $13,299,000 positively impacted operating cash flows. Cash flows were positively impact by non-cash deductions in net income from depreciation and amortization, share based compensation and deferred income taxes of $13,399,000, $2,495,000 and $473,000, respectively.
Cash provided by operating activities totaled $19,185,000 for the year ended December 31, 2025. Net income of $11,195,000 positively impacted operating cash flows. Cash flows were positively impacted by non-cash deductions in net income from depreciation and amortization and share based compensation of $12,348,000 and $1,788,000, respectively. An increase in working capital of $5,332,000 resulted in a decrease in cash.
Comprehensive income totaled $22,572,000 in 2023, compared with comprehensive income of $14,181,000 in 2022. The increase was primarily related to an increase in net income of $8,121,000. 24 Table of Contents LIQUIDITY AND CAPITAL RESOURCES Cash Flow The Company’s primary sources of funds have been cash generated from operating activities and borrowings from third parties.
The decrease was primarily related to decreases in net income of $7,025,000, foreign currency hedges of $2,674,000, and post retirement benefit plan adjustments of $2,747,000. 25 Table of Contents LIQUIDITY AND CAPITAL RESOURCES Cash Flow The Company’s primary sources of funds have been cash generated from operating activities and borrowings from third parties.
The Company also expects a change in mix in 2025 as compared to 2024 between product revenues and tooling revenues as new programs launch during 2025. During the second half of 2024 and continuing through 2026, the Company’s business with Volvo is transitioning from existing programs that the Company currently supplies to new programs that the Company does not support.
The Company also expects a consistent mix in 2026 as compared to 2025 between product revenues and tooling revenues as new programs launch during 2026.
The Company's product sales for the year ended December 31, 2023 compared to the same period of 2022 by market are as follows (in thousands): 2023 2022 Medium and heavy-duty truck $ 181,376 $ 158,649 Power sports 84,688 84,727 Building products 28,743 41,038 Industrial and utilities 23,658 27,988 All other 28,910 46,299 Net product revenue $ 347,375 $ 358,701 Gross margin was approximately 18.0% of sales for the year ended December 31, 2023, compared with 13.9% for the year ended December 31, 2022.
The Company's product sales for the year ended December 31, 2025 compared to the same period of 2024 by market are as follows (in thousands): 2025 2024 Medium and heavy-duty truck $ 101,305 163,915 Power sports $ 63,480 68,445 Building products $ 22,522 17,011 Industrial and utilities $ 22,614 18,829 All other $ 22,284 22,892 Net product revenue $ 232,205 $ 291,092 Gross margin was approximately 17.4% of sales for the year ended December 31, 2025, compared with 17.6% for the year ended December 31, 2024.
The decrease in net interest expense was due to lower average senior debt balance for the year ended December 31, 2023, when compared to the same period in 2022. The Company also recognized $346,000 of interest income during the year ended December 31, 2023.
Net interest expense totaled $1,000 for the year ended December 31, 2025, compared to net interest income of $193,000 for the year ended December 31, 2024. The Company recognized interest income of $1,218,000 from investment of the Company's accumulated cash balances during the year ended December 31, 2025 compared to $1,443,000 in 2024.
Income tax expense was approximately $5,422,000, or 21.3% of total income before income taxes for the year ended December 31, 2023. Income tax expense for the year ended December 31, 2022 was $2,382,000 and includes statutory foreign tax expense from foreign taxable income offset by tax benefits from tax losses in the United States.
Income tax expense was approximately $3,482,000, or 23.7% of total income before income taxes for the year ended December 31, 2025. Income tax expense was approximately $4,182,000, or 23.9% of total income before income taxes for the year ended December 31, 2024.
The gross margin percentage increase was due to net changes in selling price and raw material cost of 5.3% and favorable product mix and production efficiencies of 0.6%, offset by lower fixed cost leverage of 1.2% and unfavorable foreign currency impact of 0.6%.
The gross margin percentage decrease was due to unfavorable product mix and production inefficiencies of 1.0% offset by net changes in selling price and raw material cost of 0.8%. Selling, general and administrative expense ("SG&A") totaled $33,364,000 for the year ended December 31, 2025, which included severance expense of $1,455,000 and portfolio optimization related expense of $420,000.
The decrease in sales is primarily the result of lower demand from customers in building products and industrial and utilities industries, offset by higher demand from customers in the heavy-duty truck industry, full year impact of price increases related to the recoupment of raw material inflation costs, and revenues from new program launches.
The decrease in sales is primarily the result of lower demand from the medium and heavy-duty truck and power sports, including transitioning the Company's business with Volvo from existing programs that the Company currently supplies to new programs that the Company does not support, offset by new program launches and price increases.
Selling, general and administrative expense ("SG&A") totaled $37,983,000 for the year ended December 31, 2023, compared to $34,399,000 in 2022. The increase in SG&A expense primarily resulted from higher labor and benefit costs of $2,150,000, higher bonus of $907,000 and higher professional fees of $627,000.
Excluding severance and portfolio optimization costs, SG&A cost for the year ended December 31, 2025 totaled $31,489,000 compared to $35,271,000, when excluding $1,294,000 of severance costs in 2024. Decreased SG&A expenses resulted primarily from lower bonus, labor and benefits of $2,044,000 and lower stock compensation of $761,000, offset by higher healthcare cost of $628,000.
Removed
Notwithstanding this transition and the completion of existing programs with Volvo, the Company continues to actively bid for new Volvo business, which we believe we will continue to secure outside of the current programs. Going forward we remain focused on continuing to replace phased out business from existing programs with new programs from Volvo or other customers.
Added
In 2026, the Company expects to incur incremental one-time costs of approximately $2,500,000 in connection with the Mexico Expansion Project, primarily related to press relocations and the temporary overlap of two facility leases in Monterrey, as well as approximately $1,000,000 associated with the Company’s succession plan.
Removed
The Company’s raw material supply chains remain stable, and the Company anticipates raw material pricing in 2025 to remain flat or slightly higher as compared to 2024; however, if tariffs are implemented in North America, the Company 22 Table of Contents anticipates raw material cost to increase in 2025 as compared to 2024.
Added
Both expenses will primarily be incurred during the first half of 2026 and will be recorded in Selling, General, and Administrative expenses. The Company continues to monitor evolving geopolitical tensions involving Iran and any potential impact such developments may have on global supply chains, such as cost and availability.
Removed
Labor markets have also stabilized, although at higher cost levels over the past several years. The Company does not anticipate challenges in hiring hourly labor, although management believes wage pressure will continue, especially in Mexico. 2024 compared to 2023 Net sales for the years ended December 31, 2024 and 2023 totaled $302,378,000 and $357,738,000, respectively.
Added
While disruptions could create volatility in the costs of certain inputs used in the Company’s manufacturing processes, the Company maintains contractual raw material adjustment mechanisms with many of its customers that allow for changes in material costs to be passed through, which may help mitigate the financial impact of such fluctuations. 23 Table of Contents 2025 compared to 2024 Net sales for the years ended December 31, 2025 and 2024 totaled $273,798,000 and $302,378,000, respectively.
Removed
In connection with the decrease in sales, the Company has recognized a one-time severance expense totaling $570,000. During the year ended December 31, 2022, the Company refinanced its existing credit facility.
Added
The Company recorded net income for 2025 of $11,195,000 or $1.29 per diluted share, compared with net income of $13,299,000 or $1.51 per diluted share for 2024. Comprehensive income totaled $12,841,000 in 2025, compared with comprehensive income of $10,290,000 in 2024.
Removed
As a result, the Company recorded one-time losses of $1,234,000 from writing off outstanding deferred loan costs and $348,000 from prepayment fees associated with the repayment of the FGI Term Loan. Net interest expense totaled $1,011,000 for the year ended December 31, 2023, compared to interest expense of $1,960,000 for the year ended December 31, 2022.
Added
Post-Retirement Benefits Management records an accrual for post-retirement costs associated with the health care plan sponsored by the Company for certain retirees. Should actual results differ from the assumptions used to determine the reserves, additional provisions may be required.
Removed
Income tax expense for the year ended December 31, 2022, also includes a valuation allowance reversal of $2,363,000 related to deferred tax assets related to the federal jurisdiction in the United States. The Company recorded net income for 2023 of $20,324,000 or $2.31 per diluted share, compared with net income of $12,203,000 or $1.44 per diluted share for 2022.
Added
The Company has fully implemented the requirements of ASU 2023-09 for the current reporting period and has included the corresponding disaggregated reconciliation tables and income tax paid disclosures within the related footnote. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. (See Note 13, Income Taxes.) 30 Table of Contents
Removed
Leaf Capital Funding On April 24, 2020 the Company entered into a finance agreement with Leaf Capital Funding of $175,000 for equipment. The parties agreed to a fixed interest rate of 5.50% and a term of 60 months.
Removed
Management reviews all available evidence, both positive and negative, to assess the long-term earnings potential of the Company using a number of alternatives to evaluate financial results in economic cycles at various industry volume conditions. The projected availability of taxable income to realize the tax benefits from the reversal of temporary differences before expiration of these benefits are also considered.
Removed
The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. As this accounting standard only impacts disclosure, it will not have a material impact on the Company's Consolidated Financial Statements.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed6 unchanged
Biggest changeAssuming a hypothetical 10% increase in commodity prices, Core Molding Technologies would be impacted by an increase in raw material costs, which would have an adverse effect on operating margins. 30 Table of Contents
Biggest changeAssuming a hypothetical 10% increase in commodity prices, Core Molding Technologies would be impacted by an increase in raw material costs, which would have an adverse effect on operating margins. 31 Table of Contents

Other CMT 10-K year-over-year comparisons