Marked against last year's 10-K:
cut words struck through, new words highlighted and underlined.
Risk Factors 188 words changed in this paragraph; it is 65% similar to last year's version.
Trade policies could make sourcing product from overseas more difficult and/or more costly, and could adversely impact our gross and/or operating profit percentage. We source a significant amount of the products we sell from outside of North America, primarily Asia. We have made significant structural investments over time to be able to source both directly from Asia through our wholly-owned, Asia-based subsidiary, FASTCO Trading Co., Ltd., and indirectly from suppliers that procure product from international sources. This was initially necessary due to the absence of significant domestic fastener production, but over time we have expanded our non-fastener sourcing as well, and at this time it may be difficult to adjust our sourcing in the short term. In light of this, changes in trade policies could affect our sourcing operations, our ability to secure sufficient product to serve our customers and/or impact the cost or price of our products, with potentially adverse impacts on our gross and operating profit percentages and financial results. China represents a significant source of product for North America. In addition, we move and source products within North America. Any trading disruption (tariffs, product restrictions, etc.) between Canada, the U.S., and Mexico, or disruption in their respective trading relationships with other nations can adversely impact our business. Since February 2025, the U.S. government has imposed additional duties and tariffs in an effort to promote U.S. production of goods and improved trade balance with our global trading partners. This environment has been very fluid, resulting in several changes to the duties and tariffs enacted throughout the year. Certain of the duties and tariffs enacted are being challenged from a legal perspective. We are closely monitoring these developments, which could have an adverse impact on our business and financial results. There can be no assurances that these disruptions will not continue or increase in the future, with the previously mentioned countries or additional countries with which we do business. The degree to which these changes in the global marketplace affect our financial results will be influenced by the specific details of the changes in trade policies, their timing and duration, and our effectiveness in deploying tools to address these issues.
Source: Item 1A, 10-K 0000815556-26-000009 vs Item 1A, 10-K 0000815556-25-000065
MD&A 171 words changed in this paragraph; it is 58% similar to last year's version.
We saw modest economic contraction Market conditions were sluggish in our key markets in 2024. 2025. The Institute for Supply Management's Purchasing Manager's Index (PMI) for the U.S. averaged 48.3 48.9 for the full year and remained below 50, the threshold demarcating manufacturing growth or contraction, in 11 10 out of 12 months. Business activity as measured by U.S. Industrial Production declined 0.4% increased 1.2% in the first 11 months of 2024 2025 over 2023 with markets that are most relevant 2024. In 2025, the market provided minimal contribution, tariff related pricing contributed 170 to us, such as Primary Metal (-1.5%), Fabricated Metals (-0.8%), 200 basis points, and Machinery (-2.2%) declining more rapidly than the broad index. This was the primary factor contributing to our daily sales growth of 1.9%, slowing from the preceding year. The overall profile of 9.1% was share gains. In 2025, our growth was consistent the result of improved customer contract signings with 2023: growth was driven by larger, large key accounts and Onsite account customers and by non-fastener products, particularly safety. fastener products. We continued to expand our installed base of Onsites and FMI technology and lift the proportion of sales that run through our Digital Footprint. However, the effect of In a fluid tariff environment, our continued investment in key areas we view as critical to accelerate future growth and the slow growth in sales volume combined to pressure gross profit was well managed. We improved our profitability, reducing which resulted in higher incentive compensation and we invested in technology solutions to drive efficiency; however, we leveraged our SG&A expenses resulting in a 20 basis point improvement in operating margin. On the other hand, asset Asset efficiency remained stable improved from the preceding year and we generated good cash flow.
Source: Item 7, 10-K 0000815556-26-000009 vs Item 7, 10-K 0000815556-25-000065
Accounting Policies 109 words changed in this paragraph; it is 58% similar to last year's version.
In December 2023, the FASB Financial Accounting Standards Board ('FASB') issued ASU Accounting Standards Update ('ASU') 2023-09, Improvements to Income Tax Disclosures (Topic 740), which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The new guidance requires consistent categorization and greater disaggregation of information in the income tax rate reconciliation, as well as further disaggregation of income taxes paid. This change is effective We adopted ASU 2023-09 for annual periods beginning after the year ended December 15, 2024. This change will apply on a prospective basis to annual financial statements 31, 2025 and have applied the guidance retrospectively for periods beginning after the effective date. However, retrospective application in all prior periods presented is permitted. We are currently evaluating within the impact that notes to the consolidated financial statements. The adoption of ASU 2023-09 will did not have a material impact on our consolidated financial statements and disclosures and we anticipate adoption in our 2025 annual report on Form 10-K. for the year ended December 31, 2025, but did require additional disclosures. Refer to Note 7 for additional information.
Source: Item 8, Note 1 – Business Overview and Summary of Significant Accounting Policies, 10-K 0000815556-26-000009 vs Item 8, Note 1 – Business Overview and Summary of Significant Accounting Policies, 10-K 0000815556-25-000065
Legal Proceedings 7 words changed in this paragraph; it is 98% similar to last year's version.
We are involved in certain legal actions, including those that are ordinary routine litigation incidental to our business. The outcomes of these legal actions are not within our complete control and may not be known for prolonged periods of time. In some actions, the claimants seek damages, as well as other relief, that could require significant expenditures or result in lost sales. We record a liability for these legal actions when a loss is known or considered probable and the amount can be reasonably estimated. If the reasonable estimate of a known or probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. If a loss is reasonably possible but not known or probable, and can be reasonably estimated, the estimated loss or range of loss is disclosed. In most cases, significant judgment is required to estimate the amount and timing of a loss to be recorded. As of December 31, 2024, 2025, there were no litigation matters that we consider to be probable or reasonably possible to have a material adverse outcome. impact on our consolidated financial statements.
Source: Item 3, via Note 11 – Legal Contingencies, 10-K 0000815556-26-000009 vs Item 3, via Note 11 – Legal Contingencies, 10-K 0000815556-25-000065
