Company: UFPT
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001628280-25-050425
Chunk: 97

Company: UFP TECHNOLOGIES INC
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 2
Chunk 97
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30, 2024 As a percentage of sales, SG&A increased to 12.4% for the nine months ended September 30, 2025, from 12.1% for the same nine months in 2024.

31

Change in Fair Value of Contingent Consideration

In connection with the acquisitions of Welch and Marble in 2024, and DAS Medical in 2021, we are required to make contingent payments, subject to the entities achieving certain financial performance thresholds. The contingent consideration payments for the Welch, Marble and DAS Medical acquisitions are up to $6 million, $500 thousand and $20 million, respectively. The fair value of the liability for the contingent consideration payments recognized upon the acquisition as part of the purchase accounting opening balance sheets totaled approximately $800 thousand, $400 thousand and $5.2 million for the Welch, Marble and DAS Medical acquisitions, respectively, and was estimated by discounting to present value the probability-weighted contingent payments expected to be made. Assumptions used in the initial calculation were management’s financial forecasts, a discount rate and various volatility factors. The ultimate settlement of contingent consideration could deviate from current estimates based on the actual results of these financial measures. Contingent consideration is considered to be a Level 3 financial liability that is re-measured each reporting period. We paid approximately $5.3 million during the nine months ended September 30, 2025, related to contingent consideration. The fair value of the liability for the contingent consideration payments recognized at September 30, 2025,  totaled approximately $5.8 million out of the remaining potential payments of $9.3 million. The change in fair value of contingent consideration for the Welch, Marble, and DAS Medical acquisitions for the three and nine months ended September 30, 2025, resulted in an expense of approximately $263 thousand and $789 thousand, respectively. The change in fair value of contingent consideration for the DAS Medical acquisition for the three and nine months ended September 30, 2024, resulted in an expense of approximately $238 thousand and $714 thousand, respectively. The change in fair value of contingent consideration for the acquisitions is included in change in fair value of contingent consideration in the condensed consolidated statements of comprehensive income.

Interest Expense, net

Net interest expense was approximately $2.4 million and $3.5 million for the three months ended September 30, 2025, and 2024, respectively. The decrease in net interest