Monro, Inc.: Form 10-Q for the period ended Dec 27, 2025

Recent Developments

On November 9, 2025, the Board of Directors approved the adoption of a limited-duration shareholder rights plan (the “Rights Plan”), intended to protect the best interests of all Company shareholders and enable them to realize the full potential value of their investment in the Company. The Rights Plan is designed to reduce the likelihood that any entity, person or group would gain control of the Company through the open-market or other accumulation of the Company’s shares without appropriately compensating all shareholders for control. The Rights Plan is not intended to prevent or interfere with any attempt to purchase the entire Company. It is also not intended to prevent or interfere with any action with respect to the Company that the Board determines to be in the best interests of the Company and its shareholders. Instead, it will position the Board to fulfill its fiduciary duties on behalf of all shareholders by ensuring that the Board has sufficient time to make informed judgments about any attempts to control or significantly influence the Company. The Rights Plan will encourage anyone seeking to gain a significant interest in the Company to negotiate directly with the Board prior to attempting to control or significantly influence the Company. Pursuant to the Rights Plan, the Company issued one right for each common share outstanding as of the close of business on November 24, 2025. The rights will initially trade with the Company’s common stock and will generally become exercisable only if an entity, person or group acquires beneficial ownership of 17.5% or more of the Company’s outstanding shares (the “triggering percentage”). Under the Rights Plan, any person that owns more than the triggering percentage as of the adoption of the Rights Plan may continue to own its shares of common stock but may not acquire any additional shares without triggering the Rights Plan. The Rights Plan has a one-year duration, expiring on November 6, 2026. The Board of Directors may consider an earlier termination of the Rights Plan as circumstances warrant. See additional discussion related to the Rights Plan in Note 11 to our consolidated financial statements.

On May 23, 2025, following an evaluation of market segmentation and demographic data specific to geographic areas where our stores are located, our Board of Directors approved a plan to close 145 underperforming stores that we identified to have failed to maintain an acceptable level of profitability (the “Store Closure Plan”). These stores were closed during the first quarter of fiscal 2026 and $14.8 million of net store closing costs were recorded during the quarter ended June 28, 2025. During the nine months ended December 27, 2025, the Company sold 25 owned stores and related equipment. We received net proceeds of $17.4 million and recorded a net gain of $9.1 million. Additionally, the Company assigned 35 leases to third parties and early terminated 22 leases. We received net proceeds of $5.4 million and recorded a net gain of $12.0 million, which included the derecognition of lease liabilities. The total net gain of $21.1 million was recorded in operating, selling, general and administrative expenses in our Consolidated Statements of Income and Comprehensive Income for the nine months ended December 27, 2025.

As a result, net gain on closings included in operating, selling, general and administrative expenses in our Consolidated Statements of Income and Comprehensive Income was $6.3 million for the nine months ended December 27, 2025. Net store closing costs/net gain on closings represent expected costs to be incurred related to the vacating of stores, utilities, real estate taxes, maintenance, other on-going costs related to the properties, and the disposal of inventory and other store assets, net of gains on early lease terminations, lease assignments and sales of owned locations. See additional discussion related to the Store Closure Plan in Note 1 to our consolidated financial statements.

On December 2, 2025, the Company entered into an employment agreement with Peter Fitzsimmons whereby he will continue to serve as the President and Chief Executive Officer and appointed him as a member of the Board of Directors. Prior to December 2, 2025, Mr. Fitzsimmons served as the President and Chief Executive Officer, pursuant to an engagement letter between the Company and AP Services, LLC, an affiliate of AlixPartners, LLP (“AlixPartners”). Following Mr. Fitzsimmons’ departure from AlixPartners, on December 23, 2025 the Company and AlixPartners entered into a master service agreement pursuant to which AlixPartners will be able to serve promptly in consulting roles as needed at its standard engagement rates to support the development and implementation of the Company’s long-term growth strategy to improve the Company’s financial performance. See additional discussion in Note 13 to our consolidated financial statements.

Financial Summary

Third quarter 2026 included the following notable items:

Diluted earnings per common share (“EPS”) was $0.35.

Adjusted diluted EPS, a non-GAAP measure, was $0.16.

Sales decreased 4.0 percent, due to closed stores partially offset by higher comparable store sales.

Comparable store sales increased 1.2 percent from the prior year period.

Operating income was $18.6 million.

Adjusted operating income, a non-GAAP measure, was $10.3 million.

Net income was $11.1 million.

Adjusted net income, a non-GAAP measure, was $5.0 million.

Adjusted operating income, adjusted net income and adjusted diluted EPS, each of which is a measure not derived in accordance with GAAP, exclude the impact of certain items. Management believes that adjusted operating income, adjusted net income and adjusted diluted EPS are useful in providing period-to-period comparisons of the results of our operations by excluding certain items that are not part of our core operations, such as consulting costs related to the Company’s Operational Improvement Plan, transition costs related to back-office optimization, costs related to shareholder matters, store impairment charges, write-off of debt issuance costs, litigation reserve costs, store closing costs, net of gains on sales of closed stores, lease assignments and early lease terminations, and gain on sale of corporate headquarters net of closing and relocation costs. Reconciliations of these non-GAAP financial measures to GAAP measures are provided beginning on page 20 under “Non-GAAP Financial Measures.”

We define comparable store sales as sales for locations that have been opened or owned at least one full fiscal year. We believe this period is generally required for new store sales levels to begin to normalize. Management uses comparable store sales to assess the operating performance of the Company’s stores and believes the metric is useful to investors because our overall results are dependent upon the results of our stores. Comparable sales measures vary across the retail industry. Therefore, our comparable store sales calculation is not necessarily comparable to similarly titled measures reported by other companies.

Analysis of Results of Operations

Sales

Sales include automotive undercar repair, tire replacement and tire related service sales, net of discounts, returns, and revenue from the sale of warranty agreements and commissions earned from the delivery of tires. See Note 7 to our consolidated financial statements for further information. We use comparable store sales to evaluate the performance of our existing stores by measuring the change in sales for a period over the comparable, prior-year period. There were 89 selling days in each of the three months ended December 27, 2025 and December 28, 2024, and 270 selling days in each of the nine months ended December 27, 2025 and December 28, 2024.

Sales growth – from both comparable store sales and new stores – represents an important driver of our long-term profitability. We expect that comparable store sales growth will significantly impact our total sales growth. We believe that our ability to successfully differentiate our customers’, often referred to as “guests”, experience through a careful combination of merchandise assortment, price strategy, convenience, and other factors will, over the long-term, drive both increasing guest traffic and the average ticket amount spent.

The sales decrease was due to closed stores partially offset by an increase in comparable store sales. The following table shows the primary drivers of the change in sales for the three months and nine months ended December 27, 2025, as compared to the same periods ended December 28, 2024.

MANAGEMENT’S DISCUSSION AND ANALYSIS

During the three months ended December 27, 2025, comparable store sales increased in our front end/shocks category and our tires category. During the nine months ended December 27, 2025, comparable store sales increased in our front end/shocks, tires, brakes and maintenance service categories, each of which experienced declines during the nine months ended December 28, 2024. The following table shows the primary drivers of the comparable store product category sales change for the three months and nine months ended December 27, 2025, as compared to the same periods ended December 28, 2024.

(a) The comparable store product category sales change for the three and nine months ended December 28, 2024, are adjusted for selling days.

(a) Steering product category includes front end/shocks and alignment product category sales.

(a) We reopened a store that was temporarily closed in a prior year during the nine months ended December 27, 2025.

(b) Includes 145 stores closed in the first quarter of fiscal 2026 as a result of the Store Closure Plan.

Cost of Sales and Gross Profit

Gross profit, as a percentage of sales, increased 60 basis points (“bps”) for the three months ended December 27, 2025, as compared to the prior year comparable period. Material costs decreased, as a percentage of sales, due primarily to better material margin in our service categories. Occupancy costs decreased, as a percentage of sales, as we gained leverage on these largely fixed costs with higher comparable store sales and benefit from store closures. Partially offsetting this was an increase in technician labor costs, as a percentage of sales, due primarily to wage inflation. Gross profit, as a percentage of sales, decreased 20 basis points for the nine months ended December 27, 2025, as compared to the prior year comparable period. The decrease in gross profit, as a percentage of sales, was primarily due to increased technician labor, due primarily to wage inflation, partially offset by decreased occupancy costs and decreased material costs, due primarily to better material margin in our service categories.

MANAGEMENT’S DISCUSSION AND ANALYSIS

OSG&A Expenses

The decrease of $11.0 million in operating, selling, general and administrative (“OSG&A”) expenses for the three months ended December 27, 2025, from the comparable prior year period is primarily due to a decrease in store closing costs, net of gains on sales of closed stores, lease assignments and early lease terminations and a decrease in costs from closed stores, partially offset by increased store advertising costs and consulting costs related to our Operational Improvement Plan. The following table shows the impact of these costs on the change in OSG&A expenses for the three months and nine months ended December 27, 2025, as compared to the same periods ended December 28, 2024.

Other Performance Factors

Net Interest Expense

Net interest expense of $4.0 million for the three months ended December 27, 2025 decreased $0.2 million as compared to the prior year period, and remained as a percentage of sales at 1.4 percent. Weighted average debt outstanding for the three months ended December 27, 2025 decreased by approximately $25.5 million as compared to the three months ended December 28, 2024. This decrease is primarily related to lower finance lease debt related to our stores. The weighted average interest rate increased approximately 30 basis points as compared to the same period of the prior year.

Net interest expense of $13.2 million for the nine months ended December 27, 2025 decreased $1.3 million compared to the prior year period, and decreased as a percentage of sales from 1.6 percent to 1.5 percent. Weighted average debt outstanding for the nine months ended December 27, 2025 decreased by approximately $45.1 million as compared to the prior year period due primarily to lower finance lease debt related to our stores as well as lower debt outstanding under the Credit Facility. The weighted average interest rate increased approximately 10 basis points as compared to the same period of the prior year.

Provision for Income Taxes

For the three months and nine months ended December 27, 2025, our effective income tax rate was 23.6 percent and 28.9 percent, respectively, compared to 21.2 percent and 27.5 percent for the three months and nine months ended December 28, 2024, respectively.

The year-over-year difference in the effective rate is primarily related to the impact of an income tax benefit in the prior year period from the settlement of certain state income tax returns and the impact from other discrete tax adjustments, none of which are individually significant.

On July 4, 2025, the “H.R.1: One Big Beautiful Bill Act” (OBBBA) became law. The OBBBA contains a broad range of tax reform provisions with various effective dates affecting business taxpayers. The legislation did not have a material impact on our effective tax rate for the three and nine months ended December 27, 2025, and we do not expect it to have a material impact on our consolidated financial statements for the year ending March 28, 2026.

Non-GAAP Financial Measures

In addition to reporting operating income, net income and diluted EPS, which are GAAP measures, this Form 10-Q includes adjusted operating income, adjusted net income and adjusted diluted EPS, which are non-GAAP financial measures. We have included reconciliations to adjusted operating income, adjusted net income and adjusted diluted EPS from our most directly comparable GAAP measures, operating income, net income, and diluted EPS, below. Management views these non-GAAP financial measures as indicators to better assess comparability between periods because management believes these non-GAAP financial measures reflect our core business operations while excluding certain items that are not part of our core operations, such as consulting costs related to the Company’s Operational Improvement Plan, transition costs related to back-office optimization, costs related to shareholder matters, store impairment charges, write-off of debt issuance costs, litigation reserve costs, store closing costs, net of gains on sales of closed stores, lease assignments and early lease terminations, and gain on sale of corporate headquarters net of closing and relocation costs.

These non-GAAP financial measures are not intended to represent, and should not be considered more meaningful than, or as an alternative to, their most directly comparable GAAP measures. These non-GAAP financial measures may be different from similarly titled non-GAAP financial measures used by other companies.

Adjusted operating income is summarized as follows:

(a) Amounts in fiscal 2025 include the gain on sale of the corporate headquarters building net of associated closing and relocation costs.

(b) Amounts in fiscal 2026 include the gain on the sale of closed stores, lease assignments and early lease terminations net of closing costs and asset write-offs related to the closure of 145 underperforming stores, in accordance with the Store Closure Plan.

Adjusted net income is summarized as follows:

(a) Amounts in fiscal 2025 include the gain on sale of the corporate headquarters building net of associated closing and relocation costs.

(b) Amounts in fiscal 2026 include the gain on the sale of closed stores, lease assignments and early lease terminations net of closing costs and asset write-offs related to the closure of 145 underperforming stores, in accordance with the Store Closure Plan.

Adjusted diluted EPS is summarized as follows:

(a) Amounts, in the periods presented, may be too minor in amount, net of the impact from income taxes, to have an impact on the calculation of adjusted diluted EPS.

(b) Amounts in fiscal 2025 include the gain on sale of the corporate headquarters building net of associated closing and relocation costs.

(c) Amounts in fiscal 2026 include the gain on the sale of closed stores, lease assignments and early lease terminations net of closing costs and asset write-offs related to the closure of 145 underperforming stores, in accordance with the Store Closure Plan.

Note: The calculation of the impact of non-GAAP adjustments on diluted EPS is performed on each line independently. The table may not add down +/- $0.01 due to rounding.

The other adjustments to diluted EPS reflect estimated annual effective income tax rates of 26.0 percent and 28.4 percent for the three months ended December 27, 2025 and December 28, 2024, respectively and 26.0 percent and 28.0 percent for the nine months ended December 27, 2025 and December 28, 2024, respectively. This represents the tax effect of non-GAAP adjustments calculated at an estimated blended statutory tax rate. See adjustments from the Reconciliation of Adjusted Net Income table above for pre-tax amounts.

Analysis of Financial Condition

Liquidity and Capital Resources

Capital Allocation

We expect to continue to generate positive operating cash flow as we have done in each of the last three fiscal years. We believe the cash we generate from our operations will allow us to continue to support business operations, pay down debt, and return cash to our shareholders through our dividend program.

In addition, because we believe a large portion of our future expenditures will be to fund our growth, through acquisition of retail stores and/or opening greenfield stores, we continually evaluate our cash needs and may decide it is best to fund the growth of our business through borrowings on our Credit Facility. Conversely, we may also periodically determine that it is in our best interests to voluntarily repay certain indebtedness early.

Future Cash Requirements

We currently expect our capital expenditures to support our projects, including upgrading our facilities and systems, to be $25 million to $35 million in the aggregate in fiscal 2026. Additionally, we have contractual finance lease and operating lease commitments with landlords through October 2040 for $449.1 million in lease payments, of which $93.7 million is due within one year. For details regarding these lease commitments, see Note 9 to our consolidated financial statements.

As of December 27, 2025 we had $45.0 million outstanding under the Credit Facility, none of which is due in the succeeding 12 months. For details regarding our indebtedness that is due, see Note 8 to our consolidated financial statements.

Dividends

We declared dividends of $0.28 per share totaling $8.7 million for each of the three months ended December 27, 2025 and December 28, 2024 and $0.84 per share totaling $26.2 million for each of the nine months ended December 27, 2025 and December 28, 2024, respectively.

Working Capital Management

As of December 27, 2025, we had a working capital deficit of $274.5 million, an increase of $27.6 million from a deficit of $246.9 million as of March 29, 2025. The overall working capital deficit is a result of extended payment terms negotiated with suppliers. As part of our working capital management, we facilitate a voluntary supply chain finance program to provide our suppliers with the opportunity to sell receivables due from Monro to a participating financial institution subject to the independent discretion of both the supplier and participating financial institution. For details regarding our supply chain finance program, see Note 10 to our consolidated financial statements.

Sources and Conditions of Liquidity

Our sources to fund our material cash requirements are predominantly cash from operations, availability under our Credit Facility, and cash and equivalents on hand.

As of December 27, 2025, we had $4.9 million of cash and equivalents. In addition, we had $424.9 million available under the Credit Facility as of December 27, 2025, subject to compliance with our covenants. We are, and expect to remain, in compliance with these covenants.

We believe that our current sources of funds will provide us with adequate liquidity during the 12-month period following December 27, 2025, as well as in the long-term.

Summary of Cash Flows

The following table presents a summary of our cash flows from operating, investing, and financing activities.

Cash provided by operating activities

For the nine months ended December 27, 2025, cash provided by operating activities was $48.2 million, which consisted of net income of $8.8 million, increased by non-cash adjustments of $33.1 million, and a change in operating assets and liabilities of $6.4 million. The non-cash charges were largely driven by $46.2 million of depreciation and amortization, as well as $2.3 million in share-based compensation expense and $3.5 million in deferred income tax expense, partially offset by a $18.9 million net gain on disposal of assets. The change in operating assets and liabilities was driven by our inventory balance providing a source of cash of $25.3 million. This was partially offset by timing of payments that caused accounts payable and accrued expenses to be a use of cash of $21.5 million.

For the nine months ended December 28, 2024, cash provided by operating activities was $103.0 million, which consisted of net income of $16.1 million, increased by non-cash adjustments of $58.3 million and net change in operating assets and liabilities of $28.6 million. The non-cash charges were largely driven by $52.4 million of depreciation and amortization, as well as $5.7 million in deferred income tax expense. The change in operating assets and liabilities was primarily due to our supply chain finance program being a source of cash as we improved our cash flow by $80.7 million. This was partially offset by accrued expenses and other current assets being a use of cash of $24.4 million driven by timing of payments, as well as our inventory balance being a use of cash of $22.2 million due to increased inventory purchases.

Cash provided by investing activities

For the nine months ended December 27, 2025, cash provided by investing activities was $7.0 million. This was due to cash proceeds from the disposal of assets primarily related to our Store Closure Plan, of $25.3 million and the final proceeds from the sale of our wholesale tire locations and distribution assets of $3.5 million, partially offset by cash used for capital expenditures, including property and equipment, of $21.8 million.

For the nine months ended December 28, 2024, cash provided by investing activities was $0.1 million. This was due to cash provided by payments from the disposal of property and equipment, including the proceeds related to the sale of our corporate headquarters, for $12.3 million, and subsequent proceeds from the sale of our wholesale tire locations and distribution assets of $8.5 million, partially offset by cash used for capital expenditures, including property and equipment, of $20.7 million.

Cash used for financing activities

For the nine months ended December 27, 2025, cash used for financing activities was $71.0 million. This was primarily due to payment of finance lease principal and dividends of $28.1 million and $26.2 million, respectively, as well as payments on our Credit Facility, net of amounts borrowed during the period, of $16.3 million.

For the nine months ended December 28, 2024, cash used for financing activities was $99.5 million, which was primarily due to payments on our Credit Facility, net of amounts borrowed during the period, of $42.8 million, as well as payment of finance lease principal and dividends of $29.8 million and $25.8 million, respectively.

Critical Accounting Estimates

The consolidated financial statements are prepared in accordance with GAAP. The preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and related disclosures. We base our estimates on historical experience, as appropriate, and on various other assumptions that we believe to be reasonable under the circumstances. Changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ significantly from the estimates made by management. We evaluate our estimates and assumptions on an ongoing basis. To the extent that there are material differences between these estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows may be affected.

For a description of our critical accounting estimates, refer to Part II, Item 7., “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Form 10-K for the fiscal year ended March 29, 2025. There have been no material changes to our critical accounting estimates since our Form 10-K for the year ended March 29, 2025.

Recent Accounting Pronouncements

See “Recent Accounting Pronouncements” in Note 1 to our consolidated financial statements for a discussion of the impact of recently issued accounting standards on our consolidated financial statements as of December 27, 2025 and the expected impact on the consolidated financial statements for future periods.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they address future events, developments, and results and do not relate strictly to historical facts. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include, without limitation, statements preceded by, followed by, or including words such as “anticipate,” “believe,” “can,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “should,” “strategy,” “will,” “would” and variations thereof and similar expressions. Forward-looking statements are subject to risks, uncertainties, and other important factors that could cause actual results to differ materially from those expressed. For example, our forward-looking statements include, without limitation, statements regarding:

• the impact of competitive services and pricing;
• the effect of economic conditions and geopolitical uncertainty, seasonality, and the impact of weather conditions and natural disasters on customer demand;
• advances in automotive technologies including adoption of electronic vehicle technology;
• our dependence on third-party vendors for certain inventory;
• the risks associated with vendor relationships and international trade, particularly imported goods such as those sourced from China and other countries targeted with import tariffs;
• the impact of changes in U.S. trade relations and ongoing trade disputes between the United States, China, and other countries and other potential impediments to imports;
• our ability to generate sufficient cash flows from operations and service our debt obligations, including our expected annual interest expense, and to comply with the debt covenants of our Credit Facility;
• our cash needs, including our ability to fund our future capital expenditures and working capital requirements;
• our anticipated sales, comparable store sales, gross profit margin, costs of goods sold (including product mix), OSG&A expenses and other fixed costs, and our ability to leverage those costs;
• management’s estimates and expectations as they relate to income tax liabilities, deferred income taxes, and uncertain tax positions;
• management’s estimates associated with our critical accounting policies, including insurance liabilities, income taxes, and valuations for our goodwill and long-lived assets impairment analyses;
• the impact of industry regulation, including changes in environmental, consumer protection, and labor laws;
• potential outcomes related to pending or future litigation matters;
• business interruptions;
• risks relating to disruption or unauthorized access to our computer systems;
• our ability to protect customer and employee personal data;
• risks relating to acquisitions and the integration of acquired businesses with ours;
• our growth plans, including our plans to add, renovate, re-brand, expand, remodel, relocate, or close stores and any related costs or charges, our leasing strategy for future expansion, and our ability to renew leases at existing store locations;
• the impact of costs related to planned store closings or potential impairment of goodwill, other intangible assets, and long-lived assets;
• expected dividend payments;
• our ability to protect our brands and our reputation;
• our ability to attract, motivate, and retain skilled field personnel and our key executives; and
• the potential impacts of climate change on our business.

Any of these factors, as well as such other factors as discussed in Part I, Item 1A., “Risk Factors” of our Form 10-K for the fiscal year ended March 29, 2025 as well as in our periodic filings with the SEC, could cause our actual results to differ materially from our anticipated results. The information provided in this report is based upon the facts and circumstances known as of the date of this report, and any forward-looking statements made by us in this report speak only as of the date on which they are made. Except as required by law, we undertake no obligation to update these forward-looking statements after the date of this Form 10-Q to reflect events or circumstances after such date, or to reflect the occurrence of unanticipated events.

DISCLOSURES ABOUT MARKET RISK & CONTROLS AND PROCEDURES

We are exposed to market risk from potential changes in interest rates. As of December 27, 2025, excluding finance leases and financing obligations, we had no debt financing at fixed interest rates, for which the fair value would be affected by changes in market interest rates. Our cash flow exposure on floating rate debt would result in annual interest expense fluctuations of approximately $0.5 million and $0.6 million based upon our debt position at December 27, 2025 and at March 29, 2025, respectively, given a change in SOFR of 100 basis points.

Debt financing had a carrying amount that approximates a fair value of $45.0 million as of December 27, 2025, as compared to a carrying amount and a fair value of $61.3 million as of March 29, 2025.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in reports that we file or submit to the SEC pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In conjunction with the close of each fiscal quarter and under the supervision of our Chief Executive Officer (our principal executive officer) and Chief Financial Officer (our principal financial officer), we conduct an update, a review and an evaluation of the effectiveness of our disclosure controls and procedures. It is the conclusion of our Chief Executive Officer and Chief Financial Officer, based upon an evaluation completed as of the end of the most recent fiscal quarter reported on herein, that our disclosure controls and procedures were effective.

Changes in Internal Controls Over Financial Reporting

During the quarter ended December 27, 2025, we implemented Oracle HCM, a cloud-based human resources and payroll system. We executed certain changes to our processes and internal controls where appropriate and will continue to evaluate the design and operating effectiveness of internal controls as a result of this implementation in subsequent periods.

There have been no other changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) during the quarter ended December 27, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

SUPPLEMENTAL INFORMATION