# EDGAR Filing Document

**Accession Number:** 0000031107
**File Stem:** 0001654954-25-009066
**Filing Date:** 2025-8
**Character Count:** 39809
**Document Hash:** 81624ccd2c993fafe5d58cf6c3f63250
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001654954-25-009066.hdr.sgml**: 20250805

**ACCESSION NUMBER**: 0001654954-25-009066

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 16

**CONFORMED PERIOD OF REPORT**: 20250805

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Regulation FD Disclosure

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20250805

**DATE AS OF CHANGE**: 20250805

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** EASTERN CO
- **CENTRAL INDEX KEY:** 0000031107
- **STANDARD INDUSTRIAL CLASSIFICATION:** CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 060330020
- **STATE OF INCORPORATION:** CT
- **FISCAL YEAR END:** 0103

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-35383
- **FILM NUMBER:** 251185643

**BUSINESS ADDRESS:**
- **STREET 1:** 3 ENTERPRISE DRIVE
- **STREET 2:** SUITE 408
- **CITY:** SHELTON
- **STATE:** CT
- **ZIP:** 06484
- **BUSINESS PHONE:** 203-729-2255

**MAIL ADDRESS:**
- **STREET 1:** 3 ENTERPRISE DRIVE
- **STREET 2:** SUITE 408
- **CITY:** SHELTON
- **STATE:** CT
- **ZIP:** 06484

?xml version='1.0' encoding='ASCII'? eml_8k.htm

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 8-K**

**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the** 

**Securities Exchange Act of 1934**

<u>Date of Report: **August 5, 2025**</u>

(Date of earliest event reported)

---

| |
|:---|
| **The Eastern Company** |
| (Exact name of Registrant as specified in its charter) |

---

---

| | | |
|:---|:---|:---|
| **Connecticut** | **001-35383** | **06-0330020** |
| (State or other jurisdiction | (Commission | (IRS Employer |
| of incorporation) | File Number) | identification No.) |

---

---

| | |
|:---|:---|
| **3 Enterprise Drive, Suite 408, Shelton, Connecticut** | **06484** |
| (Address of principal executive offices) | (Zip Code) |

---

**<u>(203) 729-2255</u>**

(Registrant's telephone number, including area code)

_______________________________________________

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2)

☐&nbsp;&nbsp;&nbsp;&nbsp; Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐&nbsp;&nbsp;&nbsp;&nbsp; Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐&nbsp;&nbsp;&nbsp;&nbsp; Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐&nbsp;&nbsp;&nbsp;&nbsp; Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, No Par Value | EML | NASDAQ Global Market |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

ITEM 2.02 – Results of Operations and Financial Condition

Press Release dated August 5, 2025 announcing the second quarter earnings for 2025 is attached hereto.

ITEM 7.01 – Regulation FD Disclosure

On August 5, 2025, The Eastern Company released the second quarter earnings of 2025. A copy of the Press Release dated August 5, 2025, announcing the second quarter earnings for 2025 is attached hereto.

ITEM 9.01 – Financial Statements and Exhibits

(d) Exhibits

---

| | |
|:---|:---|
| Exhibit No. | Title |
| [99.1](eml_ex991.htm) | [Press Release dated August 5, 2025 announcing the second quarter earnings for 2025.](eml_ex991.htm) |
| 104 | Cover Page Interactive Data File (cover page XBRL tags are embedded within the Inline XBRL document) |

---

2<br>

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **The Eastern Company** | **The Eastern Company** |
| Date: August 5, 2025&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;  | By: | /s/Nicholas Vlahos  |
|  |  | Nicholas Vlahos<br>Chief Financial Officer |

---

3<br>

## Exhibit 99.1

**EXHIBIT 99.1**

![](eml_ex991img1.jpg)

FOR IMMEDIATE RELEASE

**THE EASTERN COMPANY REPORTS SECOND QUARTER 2025 RESULTS**

· *Cost reduction and operational improvement program successfully implemented at Big 3 Precision* 

· *Restructuring charges totaling $1.8 million expected to drive significant, ongoing cost savings of approximately $4 million throughout Eastern* 

· *Capital allocation focus drove debt reduction of $5.9 million and stock repurchases of approximately $2.1 million or 82,000 shares year-to-date* 

**SHELTON, CT – August 5, 2025** - The Eastern Company ("Eastern" or the "Company") (NASDAQ:EML), an industrial manufacturer of engineered solutions serving commercial transportation, logistics, and other industrial markets, today announced the results of operations for the second fiscal quarter ended June 28, 2025.

Chief Executive Officer Ryan Schroeder commented, "We made meaningful progress improving each of our businesses during the second quarter of 2025, as our strengthened leadership team continued to take decisive steps to enhance our commercial organization, reduce SG&A costs and drive greater operating efficiencies – all while successfully minimizing the impact of tariffs. During the quarter, we also implemented a strategic restructuring to optimize the workforce at Eberhard, Velvac and at the corporate level to streamline operations and operate more cost effectively. We estimate that these actions will result in approximately $4 million in annual cash cost savings beginning in 2026."

Mr. Schroeder continued, "At Big 3 Precision, we pushed forward with the process of overhauling its operating footprint, including transitioning its engineering and prototyping from Dearborn, MI to a smaller, more efficient location in Sterling Heights MI and moving all production activities into Big 3's existing Centralia, IL facility. This process, first announced in May 2025, will soon be completed and has already had a positive impact on reducing Big 3's operating costs and improving organizational efficiency. Combined with the sale of Big 3 Mold's ISBM business unit in April 2025 and the strategic reduction in personnel undertaken throughout the Company during the quarter, we significantly strengthened our operating position.

"At Eberhard, we have benefited from the launch of a new fleet of mail trucks for the U.S. Postal Service, their first major vehicle replacement program in three decades. Eberhard is providing several products for the new fleet, which features upgrades such as a walk-in cargo area, air conditioning, airbags, and improved camera and warning systems. We are proud to be part of the program, which will make USPS carriers' jobs easier and more comfortable.

"Today's macro-economic environment remains challenging, particularly in the heavy-duty truck and automotive markets, dampening demand and impacting our second-quarter revenue and quarter-end backlog. We are pleased, however, with our ability to successfully mitigate negative impacts from higher tariffs. Overall, we believe that the actions we have taken to improve profitability and operational effectiveness have put Eastern in a strong position for the future. Furthermore, given our strong operating foundation, healthy balance sheet and a favorable leverage profile, we remain well-equipped to pursue potential acquisitions that align with our strategic objectives. We will continue to evaluate these opportunities in a disciplined manner, consistent with our commitment to long-term value creation."

**Second Quarter and Six Months 2025 Financial Results** 

The following analysis excludes discontinued operations.

Net sales in the second quarter of 2025 decreased 3% to $70.2 million from $72.6 million in the second quarter of 2024. The decrease in sales was primarily due to lower sales of truck mirror assemblies offset by higher latch and lock assemblies. Net sales in the first six months of 2025 decreased 3% to $136.1 million from $139.8 million in the corresponding period last year. Sales decreased in the first six months of 2025 due to decreased sales of truck mirror assembles and latch and handle assemblies offset by increased sales of returnable transport packaging.

3 ENTERPRISE DRIVE, SUITE 408, SHELTON, CONNECTICUT 06484

PHONE (203) 729 - 2255 \* FAX (203) 723 - 8653 \* WWW.EASTERNCOMPANY.COM

Gross margin as a percentage of net sales was 23.3% for the second quarter of 2025 and 23.1% in the first six months of 2025 compared to 25.4% and 24.8% in the corresponding prior-year periods. This decrease was primarily due to increased raw material costs incurred as we transitioned from customer-provided material to in-house sourcing on a mirror project.

Selling, general and administrative expenses increased $1.0 million, or 9.4%, in the second quarter of 2025 compared to the corresponding 2024 period due to $1.8 million of restructuring charges, offset by lower personnel costs of $0.2 million, and $0.7 million of other reductions. Selling, general and administrative expenses increased $0.3 million in the first six months due to $1.9 million of restructuring charges, partially offset by lower personnel costs of $1.0 and $0.9 million of other reductions. As a percentage of net sales, selling and administrative costs were 17.3% for the second quarter of 2025 compared to 15.3% for the corresponding 2024 period and 16.5% for the first six months of 2025 compared to 15.9% for the 2024 period.

Net income from continuing operations for the second quarter of fiscal 2025 was $2.0 million, or $0.33 per diluted share, compared to net income of $4.1 million, or $0.65 per diluted share, for the comparable period in 2024. In the first six months of 2025, net income was $4.2 million, or $0.69 per diluted share, compared to $6.4 million, or $1.02 per diluted share, for the comparable period in 2024. Included in net income was restructuring charges of approximately $1.8 million or $1.4 million net of tax which resulted in a impact of $0.24 per diluted share in the quarter.

Adjusted net income from continuing operations (a non-GAAP measure) for the second quarter of fiscal 2025 was $3.5 million, or $0.57 per diluted share, compared to adjusted net income of $4.1 million, or $0.65 per diluted share, for the comparable period in 2024. For the six months ended June 28, 2025, adjusted net income was $5.7 million, or $0.93 per diluted share, compared to $6.4 million, or $1.02 per diluted share, for the comparable 2024 period.

Adjusted EBITDA from continuing operations (a non-GAAP measure) for the second quarter of fiscal 2025 was $6.7 million compared to Adjusted EBITDA from continuing operations of $8.0 million for the comparable 2024 period. For the six months ended June 28, 2025, adjusted EBITDA was $11.7 million compared to $13.5 million in the 2024 period. See "Non-GAAP Financial Measures" below and the reconciliation table accompanying this release.

During the second quarter of fiscal 2025, the Company repurchased 30,962 shares of common stock under the share repurchase program authorized in April 2025.

**Conference Call and Webcast**

The Eastern Company will host a conference call to discuss its results for the second quarter of 2025 and related matters on Wednesday, August 6, 2025 at 9:00AM Eastern Time. Participants can access the conference call by phone at 888-506-0062 (toll-free in the US and Canada) or 973-528-0011 (international), using access code 228156. Participants can also join via the web at <u>https://www.webcaster4.com/Webcast/Page/1757/52745</u>.

**About The Eastern Company**

The Eastern Company manages industrial businesses that design, manufacture and sell engineered solutions to markets. Eastern's businesses operate in industries that offer long-term macroeconomic growth opportunities. The Company operates from locations in the U.S., Canada, Mexico, Taiwan, and China. More information on the Company can be found at <u>www.easterncompany.com</u>.

**Safe Harbor for Forward-Looking Statements**

Statements contained in this press release that are not based on historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology such as "would," "should," "could," "may," "will," "expect," "believe," "estimate," "anticipate," "intend," "continue," "plan," "potential," "opportunities," or similar terms or variations of those terms or the negative of those terms. There are many factors that affect the Company's business and the results of its operations and that may cause the actual results of operations in future periods to differ materially from those currently expected or anticipated. These factors include:

· risks associated with doing business overseas, including fluctuations in exchange rates and the inability to repatriate foreign cash, the impact on cost structure and on economic conditions as a result of actual and threatened increases in trade tariffs and the impact of political, economic, and social instability;

· the impact of tariffs, trade sanctions or political instability on the availability or cost of raw materials;

· the impact of higher raw material and component costs and cost inflation, supply chain disruptions and shortages, particularly with respect to steel, plastics, scrap iron, zinc, copper, and electronic components;

· delays in delivery of our products to our customers;

· the impact of global economic conditions and interest rates, and more specifically conditions in the automotive, construction, aerospace, energy, oil and gas, transportation, electronic, and general industrial markets, including the impact, length and degree of economic downturns on the customers and markets we serve and demand for our products, reductions in production levels, the availability, terms and cost of financing, including borrowings under credit arrangements or agreements, the potential impact of bank failures on our ability to access financing or capital markets, and the impact of market conditions on pension plan funded status;

· restrictions on operating flexibility imposed by the agreement governing our credit facility;

· the inability to achieve the savings expected from global sourcing of materials;

· lower-cost competition;

· our ability to design, introduce and sell new or updated products and related components;

· market acceptance of our products;

· the inability to attain expected benefits from acquisitions or the inability to effectively integrate acquired businesses and achieve expected synergies;

· costs and liabilities associated with environmental compliance;

· the impact of climate change, natural disasters, geopolitical events, and public health crises, including pandemics and epidemics, and any related Company or government policies or actions;

· military conflict (including the Russia/Ukraine conflict, the conflict in the Middle East, the possible expansion of such conflicts and geopolitical consequences) or terrorist threats and the possible responses by the U.S. and foreign governments;

· failure to protect our intellectual property;

· cyberattacks; and

· materially adverse or unanticipated legal judgments, fines, penalties, or settlements.

The Company is also subject to other risks identified and discussed in this Management's Discussion and Analysis of Financial Condition and Results of Operations, in Part I, Item 1A, *Risk Factors*, and in Part II, Item 7, *Management's Discussion and Analysis of Financial Condition and Results of Operations*, of the 2024 Form 10-K, and that may be identified from time to time in our quarterly reports on Form 10-Q, current reports on Form 8-K and other filings we make with the SEC.

Although the Company believes it has an appropriate business strategy and the resources necessary for its operations, future revenue and margin trends cannot be reliably predicted, and the Company may alter its business strategies to address changing conditions. Also, the Company makes estimates and assumptions that may materially affect reported amounts and disclosures. These relate to valuation allowances for accounts receivable and excess and obsolete inventories, accruals for pensions and other postretirement benefits (including forecasted future cost increases and returns on plan assets), provisions for depreciation (estimating useful lives), uncertain tax positions, and, on occasion, accruals for contingent losses. The Company undertakes no obligation to update, alter, or otherwise revise any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future events, or otherwise, except as required by law.

**Non-GAAP Financial Measures** 

The non-GAAP financial measures we provide in this press release should be viewed in addition to, and not as an alternative for, results prepared in accordance with U.S. GAAP.

To supplement the condensed consolidated financial statements prepared in accordance with U.S. GAAP, we have presented Adjusted Net Income from Continuing Operations, Adjusted Earnings Per Share from Continuing Operations, Adjusted EBITDA from Continuing Operations, Adjusted EBITDA from Discontinued Operations and Adjusted EBITDA, which are considered non-GAAP financial measures. The non-GAAP financial measures presented may differ from similarly titled non-GAAP financial measures presented by other companies, and other companies may not define these non-GAAP financial measures in the same way. These measures are not substitutes for their comparable U.S. GAAP financial measures, such as net sales, net income, diluted earnings per share, or other measures prescribed by U.S. GAAP, and there are limitations to using non-GAAP financial measures.

Adjusted Net Income from Continuing Operations is defined as net income from continuing operations excluding, when incurred, gains or losses that we do not believe reflect our ongoing operations, including, for example, the impacts of impairment losses, gains/losses on the sale of subsidiaries, property and facilities, transaction expenses primarily relating to acquisitions and divestitures, factory start-up costs, factory relocation expenses, executive severance, and restructuring costs. Adjusted Net Income from Continuing Operations is a tool that can assist management and investors in comparing our performance on a consistent basis across periods by removing the impact of certain items that management believes do not directly reflect our underlying operating performance.

Adjusted Earnings Per Share from Continuing Operations is defined as earnings per share from continuing operations excluding, when incurred, certain per share gains or losses that we do not believe reflect our ongoing operations, including, for example, the impacts of impairment losses, gains/losses on the sale of subsidiaries, property and facilities, transaction expenses primarily relating to acquisitions and divestitures, factory start-up costs, factory relocation expenses, executive severance, and restructuring costs. We believe that Adjusted Earnings Per Share from Continuing Operations provides important comparability of underlying operational results, allowing investors and management to access operating performance on a consistent basis from period to period.

Adjusted EBITDA from Continuing Operations is defined as net income from continuing operations before interest expense, provision for income taxes, and depreciation and amortization and excluding, when incurred, the impacts of certain losses or gains that we do not believe reflect our ongoing operations, including, for example, impairment losses, gains/losses on sale of subsidiaries, property and facilities, transaction expenses primarily relating to acquisitions and divestitures, factory start-up costs, factory relocation expenses, executive severance, and restructuring expenses. Adjusted EBITDA from Continuing Operations is a tool that can assist management and investors in comparing our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our underlying operations.

Adjusted EBITDA from Discontinued Operations is defined as net income from discontinued operations before interest expense, provision for income taxes, and depreciation and amortization and excluding, when incurred, the impacts of certain losses or gains that we do not believe reflect our ongoing operations, including, for example, impairment losses, gains/losses on sale of subsidiaries, property and facilities, transaction expenses primarily relating to acquisitions and divestitures, factory start-up costs, factory relocation expenses, executive severance, and restructuring expenses. Adjusted EBITDA from Discontinued Operations is a tool that can assist management and investors in comparing our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our underlying operations.

Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, and depreciation and amortization and excluding, when incurred, the impacts of certain losses or gains that we do not believe reflect our ongoing operations, including, for example, impairment losses, gains/losses on sale of subsidiaries, property and facilities, transaction expenses primarily relating to acquisitions and divestitures, factory start-up costs, factory relocation expenses, executive severance, and restructuring expenses. Adjusted EBITDA is a tool that can assist management and investors in comparing our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our underlying operations.

Management uses such measures to evaluate performance period over period, to analyze the underlying trends in our business, to assess our performance relative to our competitors, and to establish operational goals and forecasts that are used in allocating resources. These financial measures should not be considered in isolation from, or as a replacement for, U.S. GAAP financial measures.

We believe that presenting non-GAAP financial measures in addition to U.S. GAAP financial measures provides investors greater transparency to the information used by our management for its financial and operational decision-making. We further believe that providing this information better enables our investors to understand our operating performance and to evaluate the methodology used by management to evaluate and measure such performance.

**Investor Relations Contacts**

**The Eastern Company** 

Ryan Schroeder or Nicholas Vlahos

203-729-2255

---

| | | | | |
|:---|:---|:---|:---|:---|
| **THE EASTERN COMPANY AND SUBSIDIARIES** | **THE EASTERN COMPANY AND SUBSIDIARIES** | **THE EASTERN COMPANY AND SUBSIDIARIES** | **THE EASTERN COMPANY AND SUBSIDIARIES** | **THE EASTERN COMPANY AND SUBSIDIARIES** |
| **CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)** | **CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)** | **CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)** | **CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)** | **CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)** |
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 28, 2025** | June 29, 2024 | **June 28, 2025** | June 29, 2024 |
| **Net sales** | $**70164086** | $72564231 | $**136101298** | $139798820 |
| Cost of products sold | **(53801184)** | (54108036) | **(104642211)** | (105103868) |
| Gross margin | **16362902** | 18456195 | **31459087** | 34694952 |
| Product development expense | **(1031716)** | (1301487) | **(2140902)** | (2661284) |
| Selling and administrative expenses | **(12188736)** | (11140681) | **(22534931)** | (22261047) |
| Operating profit | **3142450** | 6014027 | **6783254** | 9772621 |
| Interest expense | **(636287)** | (746941) | **(1330941)** | (1507472) |
| Other income (expense)  | **75210** | (20066) | **(124495)** | (9712) |
| **Income from continuing operations before income taxes**  | **2581373** | 5247020 | **5327818** | 8255437 |
| Income tax expense | **(546383)** | (1176830) | **(1124703)** | (1844265) |
| **Net income from continuing operations** | $**2034990** | $4070190 | $**4203115** | $6411172 |
| **Discontinued Operations (see note B)** |  |  |  |  |
| Loss from operations of discontinued unit | $**(234237)** | $(724903) | $**(520005)** | $(1230656) |
| Income from disposal of discontinued unit | **2016696** |  | **2016696** |  |
| Income tax (expense) benefit  | **(377282)** | 162585 | **(315952)** | $274929 |
| **Income (Loss) from discontinued operations** | $**1405177** | $(562318) | $**1180739** | $(955727) |
| **Net Income** | $**3440167** | $3507872 | $**5383854** | $5455445 |
| **Earnings per share from continuing operations:** |  |  |  |  |
| Basic | $**0.33** | $0.65 | $**0.69** | $1.03 |
| Diluted | $**0.33** | $0.65 | $**0.69** | $1.02 |
| **Earnings (Loss) per share from discontinued operations:** |  |  |  |  |
| Basic | $**0.23** | $(0.09) | $**0.19** | $(0.15) |
| Diluted | $**0.23** | $(0.09) | $**0.19** | $(0.15) |
| **Total earnings per share:** |  |  |  |  |
| Basic | $**0.56** | $0.56 | $**0.88** | $0.88 |
| Diluted | $**0.56** | $0.56 | $**0.88** | $0.87 |
| **Cash dividends per share:** | $**0.11** | $0.11 | $**0.22** | $0.22 |

---

**THE EASTERN COMPANY AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

---

| | | |
|:---|:---|:---|
|  | **June 28, 2025** | December 28, 2024 |
|  | **(unaudited)** |  |
| **ASSETS** |  |  |
| **Current Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | $**9110311** | $14010388 |
| &nbsp;&nbsp;&nbsp;&nbsp; Marketable Securities | **-** | 2051301 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable, less allowances: 2025 - **$585,993** 2024 - $530,560 | **40236949** | 35515632 |
| &nbsp;&nbsp;&nbsp;&nbsp; Inventories | **54140269** | 55209598 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current portion of notes receivable | **51457** | 286287 |
| &nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other assets | **4406534** | 3477717 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current assets held for sale | **-** | 5071828 |
| **Total Current Assets** | **107945520** | 115622751 |
| **Property, Plant and Equipment** | **59637113** | 56320688 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated depreciation | **(32473594)** | (28810628) |
| **Property, Plant and Equipment, Net** | **27163519** | 27510060 |
| **Goodwill** | **58637593** | 58509384 |
| **Trademarks** | **3841579** | 3946455 |
| **Patents and other intangibles net of accumulated amortization** | **7764381** | 8765612 |
| **Long term notes receivable, less current portion** | **82386** | 162102 |
| **Deferred income taxes** | **6611518** | 6611518 |
| **Right of use assets** | **17362814** | 14180865 |
| &nbsp;&nbsp;&nbsp;&nbsp; **Total Other Assets** | **94300271** | 92175936 |
| **TOTAL ASSETS** | $**229409310** | $235308747 |
| *See accompanying notes.* |  |  |

---

**THE EASTERN COMPANY AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED BALANCE SHEETS (continued)**

---

| | | |
|:---|:---|:---|
|  | **June 28, 2025** | December 28, 2024 |
|  | **(unaudited)** |  |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| **Current Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | $**23137927** | $19650970 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accrued compensation | **5157522** | 5478581 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other accrued expenses | **3222704** | 9577019 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current portion of operating lease liability | **3906222** | 3072668 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current portion of finance lease liability | **747340** | 761669 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current portion of long-term debt | **4302654** | 3603935 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other current liabilities | **-** | 505376 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current liabilities held for sale | **-** | 2144573 |
| **Total Current Liabilities** | **40474369** | 44794791 |
| **Other long-term liabilities** | **546398** | 546395 |
| **Operating lease liability, less current portion** | **13456592** | 11108197 |
| **Finance lease liability, less current portion** | **2823438** | 3052073 |
| **Long-term debt, less current portion** | **32115881** | 38640576 |
| **Accrued postretirement benefits** | **415878** | 410476 |
| **Accrued pension cost** | **15127781** | 16064840 |
| **Total Liabilities** | **104960337** | 114617348 |
| **Shareholders' Equity** |  |  |
| Voting Preferred Stock, no par value: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Authorized and unissued: 1,000,000 shares |  |  |
| Nonvoting Preferred Stock, no par value: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Authorized and unissued: 1,000,000 shares |  |  |
| Common Stock, no par value, Authorized: 50,000,000 shares | **35732135** | 35443009 |
| &nbsp;&nbsp;&nbsp;&nbsp; Issued: 9,163,570 shares as of 2025 and 9,146,996 shares as of 2024 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Outstanding: 6,098,163 shares as of 2025 and 6,163,138 shares as of 2024 |  |  |
| Treasury Stock: 3,065,407 shares as of 2025 and 2,983,858 shares as of 2024 | **(28462013)** | (26338309) |
| Retained earnings | **137581573** | 133545670 |
| Accumulated other comprehensive loss: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Foreign currency translation | **(1878997)** | (2276590) |
| &nbsp;&nbsp;&nbsp;&nbsp; Unrealized gain (loss) on foreign currency swap, net of tax | **241827** | (505376) |
| &nbsp;&nbsp;&nbsp;&nbsp; Unrecognized net pension and postretirement benefit costs, net of tax | **(18765552)** | (19177005) |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive loss | **(20402722)** | (21958971) |
| **Total Shareholders' Equity** | **124448973** | 120691399 |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | $**229409310** | $235308747 |

---

**THE EASTERN COMPANY AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended** | **Six Months Ended** |
|  | **June 28, 2025** | June 29, 2024 |
| **Operating Activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net income | $**5383854** | $5455445 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less: Income (Loss) from discontinued operations | **1180739** | (955727) |
| &nbsp;&nbsp;&nbsp;&nbsp; Income from continuing operations | $**4203115** | $6411172 |
| &nbsp;&nbsp;&nbsp;&nbsp; Adjustments to reconcile net income to net cash provided |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization | **3178318** | 3741969 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reduction in carrying amount of ROU assets | **1502376** | 1553455 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unrecognized pension and postretirement (benefit) expense | **(397676)** | 10219 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on sale of equipment and other assets | **38479** | 40801 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Provision for doubtful accounts | **14000** | 4000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock compensation expense | **289126** | 624320 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable | **(2271343)** | (5266259) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories | **1886960** | 2365451 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other | **(314221)** | 1006408 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other assets | **124859** | 28720 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | **2511193** | 2939089 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued compensation | **(445105)** | 96109 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Change in operating lease liability | **(1502376)** | (1553455) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other accrued expenses | **(6908197)** | (784960) |
| **Net cash provided by operating activities** | **1909508** | 11217039 |
| **Investing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Marketable securities | **2222059** | (999960) |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition | **(421039)** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Payments received from notes receivable | **14545** | 470937 |
| &nbsp;&nbsp;&nbsp;&nbsp; Proceeds from sale of discontinued operations | **1593646** | 18000 |
| &nbsp;&nbsp;&nbsp;&nbsp; Purchases of property, plant, and equipment | **(1598980)** | (2834977) |
| **Net cash provided by (used in) investing activities** | **1810231** | (3346000) |
| **Financing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Principal payments on long-term debt | **(5919065)** | (1505952) |
| &nbsp;&nbsp;&nbsp;&nbsp; Financing leases, net | **(393352)** | (62674) |
| &nbsp;&nbsp;&nbsp;&nbsp; Purchase common stock for treasury | **(2123705)** | (482120) |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividends paid | **(1347951)** | (1368924) |
| **Net cash used in financing activities** | **(9784073)** | (3419670) |
| **Discontinued Operations** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash used in operating activities | **-** | (955727) |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash used in discontinued operations | **-** | (955727) |
| **Effect of exchange rate changes on cash** | **331115** | (88598) |
| **Net change in cash and cash equivalents** | **(5733219)** | 3407044 |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents at beginning of period | **14843530** | 8299453 |
| **Cash and cash equivalents at end of period**  | $**9110311** | $11706497 |
| **Supplemental disclosure of cash flow information:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest | $**1683412** | $1639713 |
| &nbsp;&nbsp;&nbsp;&nbsp; Income taxes | **1679091** | 1599765 |
| **Non-cash investing and financing activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Right of use asset | **1468961** | 144445 |
| &nbsp;&nbsp;&nbsp;&nbsp; Lease liability | **(1468961)** | (144445) |

---

*See accompanying notes*

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** |
| **Adjusted Net Income from Continuing Operations and Adjusted Earnings per Share from Continuing Operations Calculation** | **Adjusted Net Income from Continuing Operations and Adjusted Earnings per Share from Continuing Operations Calculation** | **Adjusted Net Income from Continuing Operations and Adjusted Earnings per Share from Continuing Operations Calculation** | **Adjusted Net Income from Continuing Operations and Adjusted Earnings per Share from Continuing Operations Calculation** | **Adjusted Net Income from Continuing Operations and Adjusted Earnings per Share from Continuing Operations Calculation** |
| **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** |
| ($000's) |  |  |  |  |
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 28, 2025** | June 29, 2024 | **June 28, 2025** | June 29, 2024 |
| Net income from continuing operations as reported per generally accepted accounting principles (GAAP) | $**2035** | $4070 | $**4203** | $6411 |
| Earnings per share from continuing operations as reported under generally accepted accounting principles (GAAP): |  |  |  |  |
| Basic | $**0.33** | $0.65 | $**0.69** | $1.03 |
| Diluted | $**0.33** | $0.65 | $**0.69** | $1.02 |
| Adjustments: |  |  |  |  |
| Restructuring (a) | **1822** |  | **1887** |  |
| Non-GAAP tax impact of adjustments (1) | **(385)** | - | **(398)** | **-** |
| Total adjustments (Non-GAAP) | **1437** | **-** | **1489** | **-** |
| Adjusted net income from continuing operations (Non-GAAP) | $**3472** | $4070 | $**5692** | $6411 |
| Adjusted earnings per share from continuing operations (Non-GAAP): |  |  |  |  |
| Basic | $**0.57** | $0.65 | $**0.93** | $1.03 |
| Diluted | $**0.57** | $0.65 | $**0.93** | $1.02 |

---

---

| |
|:---|
| (1) We estimate the tax effect of the items identified to determine a non-GAAP annual effective tax rate applied to the pre-tax amount in order to calculate the non-GAAP provision for income taxes. |
| (a) consists of personnel related and facility costs |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** | **Reconciliation of Non-GAAP Measures** |
| **Adjusted EBITDA Calculation** | **Adjusted EBITDA Calculation** | **Adjusted EBITDA Calculation** | **Adjusted EBITDA Calculation** | **Adjusted EBITDA Calculation** |
| **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** | **For the Three and Six Months ended June 28, 2025 and June 29, 2024** |
| ($000's) |  |  |  |  |
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 28, 2025** | June 29, 2024 | **June 28, 2025** | June 29, 2024 |
| Net income from continuing operations as reported per generally accepted accounting principles (GAAP) | $**2035** | $4070 | $**4203** | $6411 |
| Interest expense | **637** | 747 | **1331** | 1507 |
| Provision for income taxes | **546** | 1176 | **1125** | 1844 |
| Depreciation and amortization | **1695** | 1965 | **3178** | 3742 |
| Restructuring (a) | **1822** | **-** | **1887** | **-** |
| Adjusted EBITDA from continuing operations (non-GAAP) | $**6735** | $7958 | $**11724** | $13504 |

---