Applied Industrial Technologies — Oct 28, 2025 release

EXHIBIT 99.1 Financial Release For Immediate Release Applied Industrial Technologies Reports Fiscal 2026 First Quarter Results • Net Sales of $1.2 Billion Up 9.2% YoY; Up 3.0% on an Organic Basis • Net Income of $100.8 Million, or $2.63 Per Diluted Share Up 11.4% YoY • Operating Income of $129.0 Million; EBITDA of $146.3 Million Up 13.4% YoY • Operating Cash Flow of $119.3 Million; Free Cash Flow of $112.0 Million • Increasing FY26 EPS Guidance to $10.10 to $10.85 • Reiterate FY26 Sales and EBITDA Margin Guidance CLEVELAND, OHIO (October 28, 2025) – Applied Industrial Technologies (NYSE: AIT), a leading value-added distributor and technical solutions provider of industrial motion, fluid power, flow control, automation technologies, and related maintenance supplies, today reported results for its fiscal 2026 first quarter ended September 30, 2025. Net sales for the quarter of $1.2 billion increased 9.2% over the prior year. The change includes a 6.3% increase from acquisitions, partially offset by a negative 0.1% impact from foreign currency translation. Excluding these factors, sales increased 3.0% on an organic basis reflecting a 4.4% increase in the Service Center segment and a 0.4% decrease in the Engineered Solutions segment. The Company reported net income of $100.8 million, or $2.63 per share, and EBITDA of $146.3 million. On a pre-tax basis, results include $2.6 million ($0.05 after tax per share) of LIFO expense compared to $2.0 million ($0.04 after tax per share) of LIFO expense in the prior-year period. Neil A. Schrimsher, Applied’s President & Chief Executive Officer, commented, “We had a solid first quarter, delivering double-digit EBITDA and EPS growth that exceeded our expectations. Total sales increased 9% year over year on stronger organic sales growth and M&A contribution. Organic growth was led by our shorter-cycle Service Center segment reflecting traction with internal initiatives, firming technical MRO demand, and our industry position. Engineered Solutions segment organic sales were relatively unchanged from the prior year but remain favorably positioned with segment orders continuing to trend positive. In addition, favorable operating leverage, cost control, and channel execution resulted in first quarter EBITDA margins of 12.2% expanding nearly 50 basis points over the prior-year period, which was ahead of our guidance. Overall, I’m encouraged by our teams’ ongoing execution and the positive momentum building across Applied.” Mr. Schrimsher added, “Following first quarter results, we are reiterating fiscal 2026 sales and EBITDA margin guidance established in mid-August. Near term, we expect improvement in end-market demand to remain gradual and bifurcated as macro and trade policy uncertainty persists into the seasonally slower fall and winter months. Combined with ongoing inflationary pressures and an evolving tariff backdrop, we believe a prudent approach to guidance remains warranted at this time. That said, we remain constructive on our set-up and positive indications that continue to develop. Customer sentiment continues to gradually improve, and we are making solid progress on various initiatives that are expanding new business funnels and growth opportunities. These dynamics could be further catalyzed by lower interest rates and reemerging capital investment across the North American industrial sector in coming quarters. Lastly, our M&A pipeline remains active and in position to supplement our growth and earnings potential.” Fiscal 2026 Guidance Today, the Company is modestly increasing fiscal 2026 EPS guidance to a range of $10.10 to $10.85 (prior $10.00 to $10.75) to primarily reflect fiscal 2026 first quarter performance and a slightly lower diluted share count assumption reflecting fiscal 2026 first quarter share repurchases. The Company is maintaining guidance for sales of up 4% to up 7% including up 1% to 4% on an organic basis, as well as EBITDA margins of 12.2% to 12.5%. Guidance incorporates ongoing macro uncertainty tied to the evolving trade and tariff backdrop, as well as inflationary headwinds and growth investments. Guidance does not assume contribution from future acquisitions or share buybacks. Dividend Today the Company also announced that its Board of Directors declared a quarterly cash dividend of $0.46 per common share, payable on November 28, 2025, to shareholders of record on November 14, 2025. Conference Call Information The Company will host a conference call at 10 a.m. ET today to discuss the quarter’s results and outlook. A live audio webcast and supplemental presentation can be accessed on our Investor Relations site at https://ir.applied.com. To join by telephone, dial 800-715-9871 (toll free) or 646-307-1963 using conference ID 7388794. Replays of the call will be available via webcast, as well as by telephone for one week by dialing 800-770-2030 (toll free) using conference ID 7388794. About Applied ® Applied Industrial Technologies is a leading value-added distributor and technical solutions provider of industrial motion, fluid power, flow control, automation technologies, and related maintenance supplies. Our leading brands, specialized services, and comprehensive knowledge serve MRO (maintenance, repair, and operations) and OEM (original equipment manufacturing), and new system install applications in virtually all industrial markets through our multi-channel capabilities that provide choice, convenience, and expertise. For more information, visit www.applied.com. This press release contains statements that are forward-looking, as that term is defined by the Securities and Exchange Commission in its rules, regulations and releases. Applied intends that such forward-looking statements be subject to the safe harbors created thereby. Forward-looking statements are often identified by qualifiers such as “expect,” “will,” “guidance,” “assume,” “believe,” and derivative or similar expressions. All forward-looking statements are based on current expectations regarding important risk factors including trends and events in the industrial sector of the economy (such as the inflationary environment and supply chain strains), results of operations, and financial condition, and other risk factors identified in Applied's most recent periodic report and other filings made with the Securities and Exchange Commission. Accordingly, actual results may differ materially from those expressed in the forward-looking statements, and the making of such statements should not be regarded as a representation by Applied or any other person that the results expressed therein will be achieved. Applied assumes no obligation to update publicly or revise any forward-looking statements, whether due to new information, or events, or otherwise. # # # CONTACT INFORMATION Ryan D. Cieslak Director – Investor Relations & Treasury 216-426-4887 / rcieslak@applied.com APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES CONDENSED STATEMENTS OF CONSOLIDATED INCOME (Unaudited) (In thousands, except per share data) Three Months Ended September 30, 2025 2024 Net Sales $ 1,199,523   $ 1,098,944   Cost of sales 838,094  773,862  Gross Profit 361,429   325,082   Selling, distribution and administrative expense,  including depreciation 232,399  211,910  Operating Income 129,030   113,172   Interest expense (income), net 993  (627) Other (income) expense, net (548) (2,281) Income Before Income Taxes 128,585   116,080   Income tax expense 27,778  24,017  Net Income $ 100,807   $ 92,063   Net Income Per Share - Basic $ 2.67   $ 2.40   Net Income Per Share - Diluted $ 2.63   $ 2.36   Average Shares Outstanding - Basic 37,757   38,398   Average Shares Outstanding - Diluted 38,271   38,944   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1) Inventories are valued at average cost, using the last-in, first-out (LIFO) method for U.S. inventories. An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on management’s estimates of expected year-end inventory levels and costs and are subject to the final year-end LIFO inventory determination. APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands) September 30, June 30, 2025 2025 Assets   Cash and cash equivalents $ 418,716  $ 388,417    Accounts receivable, net 753,443  769,699    Inventories 521,675  505,337    Other current assets 71,457  84,020         Total current assets 1,765,291  1,747,473    Property, net 129,532  128,154    Operating lease assets, net 185,730  188,654    Intangibles, net 338,895  348,600    Goodwill 699,862  699,374    Other assets 66,164  63,289  Total Assets $ 3,185,474   $ 3,175,544   Liabilities   Accounts payable $ 276,855  $ 280,124    Other accrued liabilities 220,900  246,027         Total current liabilities 497,755  526,151    Long-term debt 572,300  572,300    Other liabilities 231,664  232,573  Total Liabilities 1,301,719   1,331,024   Shareholders' Equity 1,883,755   1,844,520   Total Liabilities and Shareholders' Equity $ 3,185,474   $ 3,175,544   APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (Unaudited)  (In thousands) Three Months Ended September 30, 2025 2024 Cash Flows from Operating Activities Net income $ 100,807   $ 92,063   Adjustments to reconcile net income to net cash provided by operating activities:    Depreciation and amortization of property 6,486  5,924     Amortization of intangibles 10,203  7,600     Provision for losses on accounts receivable (1,671) 1,056     Amortization of stock appreciation rights 1,494  1,326     Other share-based compensation expense 1,831  1,675     Changes in assets and liabilities, net of acquisitions (584) 16,587     Other, net 751  1,516  Net Cash provided by Operating Activities 119,317   127,747   Cash Flows from Investing Activities    Acquisition of businesses, net of cash acquired (2,280) (10,498)    Capital expenditures (7,301) (5,549)    Proceeds from property sales 35  831  Net Cash used in Investing Activities (9,546) (15,216) Cash Flows from Financing Activities    Long-term debt repayments —  (63)    Interest rate swap settlement receipts 2,698  3,738     Purchases of treasury shares (53,175) (9,980)    Dividends paid (17,383) (14,218)    Acquisition holdback payments (1,210) (1,210)    Taxes paid for shares withheld for equity awards (9,495) (12,314) Net Cash used in Financing Activities (78,565) (34,047) Effect of Exchange Rate Changes on Cash (907) (581) Increase in cash and cash equivalents 30,299  77,903  Cash and Cash Equivalents at Beginning of Period 388,417  460,617  Cash and Cash Equivalents at End of Period $ 418,716   $ 538,520     APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES SUPPLEMENTAL INFORMATION RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (Unaudited) (In thousands) The Company supplements the reporting of financial information determined under U.S. generally accepted accounting principles (GAAP) with reporting of non-GAAP financial measures. The Company believes that these non-GAAP measures provide meaningful information to assist shareholders in understanding financial results, assessing prospects for future performance, and provide a better baseline for analyzing trends in our underlying businesses. Because non-GAAP financial measures do not have a standard definition, it may not be possible to compare these non-GAAP financial measures with other companies' non-GAAP financial measures having the same or similar names. These non-GAAP financial measures should not be considered in isolation or as a substitute for reported results. The Company believes these non-GAAP financial measures reflect an additional way of viewing aspects of operations that, when viewed with GAAP results, provide a more complete understanding of the business. The Company strongly encourages investors and shareholders to review company financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. Reconciliation of Net Income, a GAAP financial measure, to EBITDA, a non-GAAP financial measure: Three Months Ended September 30, 2025 2024 Net Income $ 100,807   $ 92,063   Interest (income) expense, net 993  (627) Income tax expense 27,778  24,017  Depreciation and amortization of property 6,486  5,924  Amortization of intangibles 10,203  7,600  EBITDA $ 146,267   $ 128,977   The Company defines EBITDA as Earnings from operations before Interest, Taxes, Depreciation, and Amortization. EBITDA is a non-GAAP financial measure which excludes items that may not be indicative of core operating results. Reconciliation of Net Cash provided by Operating activities, a GAAP financial measure, to Free Cash Flow, a non-GAAP financial measure:  Three Months Ended September 30, 2025 2024 Net Cash provided by Operating Activities $ 119,317   $ 127,747   Capital expenditures (7,301) (5,549) Free Cash Flow $ 112,016   $ 122,198   Free cash flow is a non-GAAP financial measure and is defined as net cash provided by operating activities less capital expenditures.