MSA

• Overall Q2 2026 Performance

  • Delivered 6% reported sales growth, 24% year-over-year growth in adjusted earnings per share ($2.40), and robust margin expansion
  • Generated $83 million in free cash flow, with 96% conversion to earnings, a 118% increase year-over-year; first half 2026 free cash flow conversion hit 94%
  • Returned $47 million to shareholders via buybacks and dividends in Q2; total first half shareholder returns reached $118 million, a 45% increase year-over-year, including a 56th consecutive annual dividend increase
  • Completed the acquisition of Atronica Fire and Security in early July 2026; post-acquisition pro forma net leverage is 1.8x, 0.2x lower than prior guidance

• Product and Strategic Execution

  • The new H2 Type 2 safety helmet drove strong industrial PPE growth in the Americas, strengthening MSA's competitive position in premium safety markets
  • Connected solutions under the MSA Plus platform now account for 14% of total portable gas detection sales, up from 10% year-over-year, and represented over half of portable gas detection growth in the quarter; early adoption of the newly launched Altair IO6 solution has outperformed expectations
  • The MSA Business System (MBS) continues to drive operational discipline, improved productivity, and positive price-cost performance, with benefits increasingly reflected in operating results
  • Organic orders were strong, with a book-to-bill ratio of ~1.0 that exceeded seasonal Q2 patterns; order growth was broad-based across all segments and product categories

• Product Category Highlights

  • Detection: Organic sales were flat year-over-year, with mid-single-digit growth in portable gas detection offset by a low single-digit decline in fixed monitoring due to Middle East conflict disruptions; the Americas delivered high single-digit detection growth
  • Fire Service: Organic sales decreased 2% year-over-year, driven by slower-than-expected 2025 AFG grant-related order fulfillment in the Americas due to an extended U.S. government shutdown through late May; order momentum accelerated through the end of June, with strong July trends
  • Industrial PPE: Organic sales grew 16% year-over-year, reflecting healthy demand across core industrial markets; ballistic helmet growth in international segments remained robust, supported by increased European defense spending

• Maintained the full year 2026 organic sales growth outlook of mid-single-digit, supported by strong Q2 performance and a healthy overall order book
• Expects full year 2026 total revenue growth of low double-digit, supported by mid-single-digit organic growth, mid-single-digit contribution from acquisitions, and a 1-2 percentage point tailwind from currency translation
• Expects full year 2026 adjusted gross margin to fall in the 47.5% to 48.5% range, excluding impacts of any new tariffs; a moderate gross margin tempering is expected in the second half as higher-cost inventory stemming from Middle East conflict-related inflation flows through the income statement
• Increased the full year 2026 interest expense range to $40 million to $43 million; full year tax rate and pension income guidance remain unchanged
• Going forward, sales contributions from acquisitions will be included in reported organic sales

Americas Segment: 7% year-over-year reported sales growth, with 5% organic growth and a 2% tailwind from currency translation. It delivered double-digit organic growth in industrial PPE and high single-digit growth in detection. Adjusted operating margin was 32%, a 290 basis point increase year-over-year, driven by strong execution, strategic pricing, productivity, favorable forex, and lower tariffs, partially offset by inflation. Excluding tariff refunds, adjusted incremental operating margin was 53%.

International Segment: 5% year-over-year reported sales growth, with 3% contribution from acquisitions and a 2% tailwind from forex. Organic sales were flat year-over-year, as strong industrial PPE growth offset a double-digit decline in detection due to the ongoing Middle East conflict; fire service sales were flat. Adjusted operating margin was 15.5%, 240 basis points above the prior year and 500 basis points higher than Q1 2026, driven by higher volume, acquisition contributions, productivity, and favorable forex, partially offset by inflation. Adjusted incremental operating margin was 62%.

• The ongoing conflict in the Middle East has disrupted fixed monitoring demand and shipment activity, reduced first half 2026 revenue by more than 1.5 percentage points, and muted regional growth expectations until the conflict is resolved; Middle East sales represent a mid-single-digit percentage of total company revenue
• Electronic component costs and supply continuity are emerging concerns; management has built these costs into second half guidance and added incremental inventory to maintain supply continuity
• Inflation and higher costs for transportation, resins, and metallics stemming from the Middle East conflict are expected to pressure margins in the second half as higher-cost inventory moves through the income statement
• AFG grant-related order fulfillment has been slower than expected, and fire service ordering remains lumpy, though order momentum has improved in recent months

Q: Two-thirds of 2025 AFG grant-related orders were outstanding last quarter. Will most move to H2 2026, and will 2026 funding return to normal or slip into 2027? Also, what is the initial feedback for Altair IO6, and will MSA Plus adoption continue growing? / A: 2025 AFG orders have come in slower than expected, but order pace accelerated in June and July, signaling continued improvement. FEMA is working to speed up 2026 grant processing after the earlier government shutdown, with strong demand signals for H2 2026. MSA Plus, including the new IO6, has received very positive customer feedback; IO6 order growth has outperformed early expectations, and MSA Plus now makes up 14% of portable sales, a share that will continue growing. (312 characters)

Q: How much of industrial PPE strength comes from ballistic helmets versus short-cycle demand, and what end markets drive Americas strength? Also, what is the update on electronic supply and costs? / A: In international markets, ballistic helmets driven by European defense spending are a key contributor to growth, but fall protection and other PPE lines also show solid performance. In the Americas, strength is broad-based, driven by core industrial and infrastructure investment (including data center projects) and growing adoption of the H2 safety helmet. Management is actively managing higher electronic component costs, which are incorporated into guidance, and has built incremental inventory to ensure supply continuity. (398 characters)

Q: Where does the new NFPA standard stand for fire service, and when will the replacement cycle inflect? What is a sustainable gross margin exiting 2026, and how does current leverage impact M&A pipeline activity? / A: All competitors now have approved products for the updated NFPA standard, so this transition is complete. Ordering has been slowed by government delays, but the pipeline is strengthening, with inflection expected in 2027. Full year adjusted gross margin is guided to 47.5%-48.5%, which incorporates all current cost pressures. MSA's target leverage range is 1.5-2.5x; post-Atronica leverage is 1.8x, so the M&A pipeline remains robust, and management will stay active pursuing deals even if they temporarily push leverage above the range, with plans to de-lever quickly. (472 characters)

Q: How large is the Middle East order delay impact on fixed detection, and what is the demand outlook outside the region? What was the Q2 tariff impact, and are resin/transportation costs stabilizing? / A: The Middle East conflict has reduced first half revenue by more than 1.5 percentage points, and regional demand remains muted until the conflict resolves, though small levels of rebuild order activity have begun. Fixed detection order growth is strong in North America and accelerating overall, excluding Middle East impacts. The Q2 $4 million tariff refund added ~80-90 basis points of margin, and all new tariff impacts are already incorporated into full year guidance. Higher transportation and input costs are reflected in current guidance, and supplier contracts help mitigate ongoing volatility. (447 characters)