Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

The Company is subject to market risk associated with changes in foreign currency exchange rates and interest rates as well as inflationary factors.

Foreign Currency Exchange Rates

The Company is exposed to foreign currency risks that arise from its global business operations. Approximately 34% of net sales in 2025 were recorded by subsidiaries with functional currencies other than the U.S. Dollar. Changes in foreign currency exchange rates affect the Company’s results of operations, financial position and cash flows when these subsidiaries’ results are translated into U.S. Dollars, the Company’s functional reporting currency. The strengthening of the U.S. Dollar could result in unfavorable translation effects as the results of foreign operations are translated into U.S. Dollars.

Changes in foreign currency exchange rates also affect transaction gains and losses associated with transactions denominated in currencies other than a subsidiary’s functional currency. The Company manages its foreign exchange risk principally through invoicing customers in the same currency as the source of products. The foreign currency transaction losses

(gains) for the years ended December 31, 2025, 2024 and 2023 were $5.6 million, $(1.0) million and $7.3 million, respectively, and are reported within Other expense (income) – net on the Consolidated Statements of Income.

Interest Rate Fluctuations

The Company has interest rate exposure due to $228.8 million of the $1,829.8 million debt outstanding at December 31, 2025 bearing floating rate debt. The Company’s Revolving Facility bears interest at either an alternate base rate or adjusted Term SOFR (or appropriate alternative currency reference rates) plus, in each case, an applicable margin based on the lower of the Company’s senior, unsecured, long-term debt rating or the Company’s applicable leverage ratio. At December 31, 2025, there was $228.8 million outstanding under the Revolving Facility with an interest rate of 3.32%. A hypothetical 1% change in the interest rate would cause the interest expense on the Company’s floating rate debt to change by approximately $2.3 million per year.

Inflation Risk

We source a wide variety of materials and components from a network of global suppliers. While materials are typically available from numerous suppliers, they are subject to price fluctuations, including the impact of new or increased tariffs on imports, which could have a negative impact on our results. We seek to minimize the effects of inflation and changing prices through price increases to maintain reasonable gross margins.