EASTERN CO Q4 FY2024 earnings call

• Appointed Zach Gorny as President of Eberhard Manufacturing in December 2024 to capitalize on its brand and drive commercial/product development. - Promoted Emilio Ruffalo to President of Big 3 Precision Products in January 2025 to streamline processes and improve performance. - Velvac's President Dan McGrew led production acceleration in 2024. - Focus on continuous improvement, decentralized approach where operating businesses drive their own agendas, and developing nimble supply chains with multiple sourcing options for customers.

For the fourth quarter of 2024, net sales increased 4.5% to $66.7 million from $63.8 million in 2023, driven by higher truck demand for returnable transport packaging products but offset by lower demand for truck accessories and mirror assemblies. Full year 2024 net sales rose 5% to $272.8 million. Gross margin in Q4 2024 was 23% vs. 26.8% in 2023, primarily due to higher material costs. Full year 2024 gross margin was 24.7% vs. 23.9% in 2023. Selling and administrative expense increased $1.1 million in Q4 2024 and $3.1 million for the full year. Net income in Q4 2024 was $1.6 million vs. $3.9 million in 2023, while full year 2024 net income was $13.2 million vs. $11.8 million in 2023.

• Focus on continuous improvement and commercial excellence in each business. - Decentralized operating model with businesses receiving tools/support from executive team. - Velvac working on product expansion in aftermarket and launching new mirror platform. - Eberhard working on product upgrades, electrification, and robust launch processes. - Big 3 implementing plan to streamline processes, grow revenue, and increase profitability.

• Forward-looking statements subject to risks and uncertainties from SEC filings. - Supply chain concerns including costs, lead times, tariffs. - Impact of business environment changes, including tariffs and pricing fluctuations.

Q: Are you able to pass through cost increases to your customers?

A: Can pass down cost increases but work with customers to find best solutions for their environment.

Q: Comment on Class 8 market and Eastern's opportunities in 2025?

A: Velvac's OE business tracks Class 8 production, with new mirror platform launch; aftermarket growth expected faster than market; Eberhard's sleeper cab products tied to Class 8 build rates, with forecasted improvement; impact of emissions requirements on Class 8 market.