Operating income swung to $1.4M loss on $114M Electrical Steel impairments; $681M Kloeckner acquisition closed

Filed July 30, 2026 · Period ending May 31, 2026 · Compared to 10-K Jul 29, 2025 · ~2 min read

Key Changes

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  Operating income swung from $147.0M profit to $1.4M loss, driven by $53.8M goodwill impairment and $58.4M long-lived asset impairment in Electrical Steel reporting unit due to weakened demand in industrial motors and automotive from foreign competition and delayed program launches.

  MD&A: Operating Income & Notes: Impairments verify on EDGAR →
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  Company closed acquisition of 61.87% stake in Kloeckner for $681M on June 3, 2026, funded with $1.4B new debt (7.750% Senior Secured Notes and Term Loan at SOFR+4%). German law restricts full operational control until domination and profit-and-loss transfer agreement (DPLTA) is approved by minority shareholders, with no assurance of approval.

  MD&A & Notes: Kloeckner Acquisition; Risk Factors: DPLTA Restrictions verify on EDGAR →
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  If DPLTA is approved, company will be obligated to compensate Kloeckner for any annual net losses and provide minority shareholders with either annual recurring compensation or exit compensation on demand, creating open-ended cash commitments subject to appraisal proceedings.

  Risk Factors: DPLTA Financial Obligations verify on EDGAR →