The Eastern Company Q2 FY2025 earnings call

• Overhauled Big 3's operating footprint with closure of Dearborn, Michigan facility and warehouse, opening a smaller facility in Sterling Heights, Michigan. • Salaried headcount reductions at Eberhard, Velvac, and corporate offices, with 60 jobs impacted and annual savings of $4 million. • Eberhard ramping up participation in the USPS delivery vehicle program, supplying custom design products and systems. • Completed share buyback program with 400,000 shares purchased, 82,000 in the quarter. • Sold Centralia mold assets and rolled other mold businesses back into operations. • Teams managed tariffs, with Velvac and Eberhard virtually neutralizing P&L impact.

Revenue for the quarter was $70.2 million, down 3% from prior year. Gross margin for the second quarter of 2025 was 23.3% of net sales compared to 25.4% in the prior year period. Eberhard has been ramping up participation in the United States Postal Service delivery vehicle program. Big 3 Precision was well positioned to benefit from being made in America. Velvac and Eberhard teams managed to neutralize tariff impacts on their P&L.

• Expect recovery in the coming months and quarters. • Focus on margin protection and maintaining a flexible and resilient supply chain. • Intend to be active but disciplined in M&A opportunities.

• Forward-looking statements subject to risks and uncertainties that could cause actual results to differ from projections. • Risks and uncertainties discussed in SEC filings, including Form 10-K for fiscal year 2024 and Form 10-Q for Q2 2025.

Q: Okay, sir, we currently have no questions on the lines at this time.

A: Excellent. Well, from a closing remark standpoint, I'd like to just say thank you for joining us this morning. There are certainly challenges in the markets we compete in, but at the same time, there are many compelling opportunities. I'm proud of how much our companies have accomplished this quarter, which is most certainly setting us up for success in the near future as well as in the long term. The new leadership team is in place, along with a strategic refresh of each of our businesses. Our conservative balance sheet allows for a unique and opportunistic approach to M&A and/or continued share buyback. We look forward to giving you another update after the third quarter. If you need any additional information in the meantime, please reach out to us. And with that, I'd like to say thank you as we close the call.