SEDAR Interim Financial Statements

W A J A X C O R P O R A T IO N C O N D E N S E D C O N S O L I D A T E D I N T E R I M S T A T E M E N T S O F F I N A N C I A L P O S I T I O N As at (unaudited, in thousands of Canadian dollars) Note September 30, 2025 December 31, 2024 ASSETS CURRENT Cash $ — $ 7,351 Trade and other receivables 5 287,507 303,537 Contract assets 6 61,261 55,588 Inventory 7 605,685 673,076 Deposits on inventory 17,214 13,411 Lease receivables - current 10,005 9,062 Income taxes receivable — 3,563 Prepaid expenses 14,904 15,321 Derivative financial assets - current 15 4,993 13,403 Total current assets 1,001,569 1,094,312 NON-CURRENT Rental equipment 8 43,326 50,044 Property, plant and equipment 8 44,961 45,669 Right-of-use assets 9 151,616 158,473 Lease receivables 15,799 17,538 Goodwill and intangible assets 178,761 183,520 Derivative financial assets 15 1,133 1,698 Total non-current assets 435,596 456,942 Total assets $ 1,437,165 $ 1,551,254 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT Bank indebtedness $ 551 $ — Accounts payable and accrued liabilities 10 364,852 421,464 Provisions - current 7,291 7,172 Contract liabilities 6 21,131 23,182 Dividends payable 16 7,611 7,629 Income taxes payable 5,154 — Lease liabilities - current 11 42,464 40,151 Debentures - current 13 — 56,973 Derivative financial liabilities - current 15 2,295 5,313 Total current liabilities 451,349 561,884 NON-CURRENT Deferred tax liabilities 6,280 8,999 Employee benefits 12 4,085 6,526 Derivative financial liabilities 15 1,697 3,585 Lease liabilities 11 157,714 168,031 Long-term debt 14 280,067 283,042 Other liabilities 3,416 6,904 Total non-current liabilities 453,259 477,087 Total liabilities 904,608 1,038,971 SHAREHOLDERS’ EQUITY Share capital 16 210,961 211,453 Contributed surplus 8,569 7,511 Retained earnings 312,644 289,993 Accumulated other comprehensive income 383 3,326 Total shareholders’ equity 532,557 512,283 Total liabilities and shareholders' equity $ 1,437,165 $ 1,551,254 Subsequent events (Note 24) See accompanying notes to unaudited condensed consolidated interim financial statements. W A J A X C O R P O R A T I O N C O N D E N S E D C O N S O L I D A T E D I N T E R I M S T A T E M E N T S O F E A R N I N G S Three months ended September 30 Nine months ended September 30 (unaudited, in thousands of Canadian dollars, except per share data) Note 2025 2024 2025 2024 Revenue 18 $ 483,145 $ 481,020 $ 1,585,253 $ 1,531,669 Cost of sales 382,824 388,735 1,274,475 1,214,471 Gross profit 100,321 92,285 310,778 317,198 Selling and administrative expenses 70,785 70,852 223,549 231,844 Restructuring and other related costs 19 — — 3,846 — Earnings before finance costs and income taxes 29,536 21,433 83,383 85,354 Finance costs 20 6,823 13,011 22,131 29,785 Earnings before income taxes 22,713 8,422 61,252 55,569 Income tax expense 21 5,983 2,023 15,919 13,810 Net earnings $ 16,730 $ 6,399 $ 45,333 $ 41,759 Basic earnings per share 16 $ 0.77 $ 0.29 $ 2.08 $ 1.92 Diluted earnings per share 16 $ 0.75 $ 0.29 $ 2.04 $ 1.88 W A J A X C O R P O R A T I O N C O N D E N S E D C O N S O L I D A T E D I N T E R I M S T A T E M E N T S O F C O M P R E H E N S I V E I N C O M E Three months ended September 30 Nine months ended September 30 (unaudited, in thousands of Canadian dollars) Note 2025 2024 2025 2024 Net earnings $ 16,730 $ 6,399 $ 45,333 $ 41,759 Items that will not be reclassified to earnings Actuarial loss on pension plans, net of tax recovery of $14 (2024 - recovery of nil) 12 — --- — (41) — Items that may be subsequently reclassified to earnings Unrealized gain (loss) on derivatives designated as cash flow hedges, net of tax expense of $108 (2024 - recovery of $239) and year to date, net of tax recovery of $693 (2024 - expense of $198) 303 (670) (1,941) 555 Reclassification of realized loss (gain) on derivatives designated as cash flow hedges to net earnings during the period, net of tax recovery of $91 (2024 - expense of $119) and year to date, net of tax expense of $357 (2024 - recovery of $6) 255 (334) (1,002) 17 Other comprehensive income (loss), net of tax 558 (1,004) (2,984) 572 Total comprehensive income $ 17,288 $ 5,395 $ 42,349 $ 42,331 See accompanying notes to unaudited condensed consolidated interim financial statements. W A J A X C O R P O R A T I O N C O N D E N S E D C O N S O L I D A T E D I N T E R I M S T A T E M E N T O F C H A N G E S I N S H A R E H O L D E R S ’ E Q U I T Y Accumulated other comprehensive income (loss) For the nine months ended September 30, 2025 (unaudited, in thousands of Canadian dollars) Note Share capital Contributed surplus Retained earnings Cash flow hedges Total December 31, 2024 $ 211,453 $ 7,511 $ 289,993 $ 3,326 $ 512,283 Net earnings — — 45,333 — 45,333 Other comprehensive loss — — (41) (2,943) (2,984) Total comprehensive income — — 45,292 (2,943) 42,349 Shares released from trust to settle share-based compensation awards 16, 17 222 (1,595) 879 — (494) Purchased for future settlement of certain share-based compensation awards 16 (714) — (661) — (1,375) Share-based compensation expense 17 — 2,653 — — 2,653 Dividends declared 16 — — (22,859) — (22,859) September 30, 2025 $ 210,961 $ 8,569 $ 312,644 $ 383 $ 532,557 See accompanying notes to unaudited condensed consolidated interim financial statements. W A J A X C O R P O R A T I O N C O N D E N S E D C O N S O L I D A T E D I N T E R I M S T A T E M E N T O F C H A N G E S I N S H A R E H O L D E R S ’ E Q U I T Y Accumulated other comprehensive income (loss) For the nine months ended September 30, 2024 (unaudited, in thousands of Canadian dollars) Note Share capital Contributed surplus Retained earnings Cash flow hedges Total December 31, 2023 $ 210,004 $ 7,563 $ 278,100 $ 570 $ 496,237 Net earnings — — 41,759 — 41,759 Other comprehensive income — — — 572 572 Total comprehensive income — — 41,759 572 42,331 Shares issued to settle share-based compensation awards 16. 283 (283) — — — Shares released from trust to settle share-based compensation awards 16, 17 545 (2,160) (508) — (2,123) Excess tax benefit on share-based compensation — — 712 — 712 Purchased for future settlement of certain share-based compensation awards 16 (285) — (695) — (980) Share-based compensation expense 17 — 2,533 — — 2,533 Dividends declared 16 — — (22,802) — (22,802) September 30, 2024 $ 210,547 $ 7,653 $ 296,566 $ 1,142 $ 515,908 See accompanying notes to unaudited condensed consolidated interim financial statements. W A J A X C O R P O R A T I O N C O N D E N S E D C O N S O L I D A T E D I N T E R I M S T A T E M E N T S O F C A S H F L O W S Three months ended September 30 Nine months ended September 30 (unaudited, in thousands of Canadian dollars) Note 2025 2024 2025 2024 OPERATING ACTIVITIES Net earnings $ 16,730 $ 6,399 $ 45,333 $ 41,759 Items not affecting cash flow: Depreciation and amortization: Rental equipment 8 3,150 3,469 9,751 10,334 Property, plant and equipment 8 2,513 2,261 6,917 6,558 Right-of-use assets 9 8,988 8,330 25,2 --- 95 24,195 Intangible assets 1,561 1,758 4,759 5,266 Loss (gain) on disposal of property, plant & equipment 172 (63) (59) (183) (Gain) loss on disposal of right-of-use assets (15) (5) 3 (206) Share-based compensation expense 17 1,873 1,498 4,973 5,791 Non-cash income from finance leases (738) (678) (1,333) (1,350) Employee benefits expense, net of employer contributions (9) (24) (2,496) (77) (Gain) loss on foreign exchange forwards and total return swaps 15 (1,096) 339 (995) 587 Finance costs 20 6,823 13,011 22,131 29,785 Income tax expense 21 5,983 2,023 15,919 13,810 45,935 38,318 130,198 136,269 Changes in non-cash operating working capital 22 (16,440) (47,606) 18,295 (67,259) Rental equipment additions 8 (272) (8,999) (3,812) (25,145) Other non-current liabilities 156 (2,137) 156 (2,127) Cash (paid) received on settlement of total return swaps 15 — — (415) 1,896 Finance costs paid on debts (3,806) (6,399) (15,888) (18,067) Finance costs paid on lease liabilities 11, 20 (2,724) (2,658) (8,171) (7,807) Interest collected on lease receivables 20 321 269 994 724 Income taxes paid (4,701) (7,372) (8,857) (24,703) Cash generated from (used in) operating activities 18,469 (36,584) 112,500 (6,219) INVESTING ACTIVITIES Property, plant and equipment additions 8 (1,230) (2,276) (6,164) (6,745) Proceeds on disposal of property, plant and equipment 110 110 630 304 Intangible asset net disposals (additions) 960 — — (241) Collection of lease receivables 2,864 2,060 7,756 5,553 Post acquisition settlement payments, net of receipts 4 — — (2,785) 912 Cash generated from (used in) investing activities 2,704 (106) (563) (217) FINANCING ACTIVITIES Net increase (decrease) in bank debt 14 1,028 44,967 (2,114) 55,978 Repayment of debentures 13 — — (57,000) — Purchase of shares held in trust — — (1,375) (980) Transaction costs on debts 14 — (33) — (472) Payment of lease liabilities 11 (11,623) (10,189) (32,676) (28,961) Payment of contingent consideration 15 (2,653) (3,039) (3,303) (3,039) Payment of tax withholding for share-based compensation — — (494) (2,123) Dividends paid (7,611) (7,594) (22,877) (22,347) Cash (used in) generated from financing activities (20,859) 24,112 (119,839) (1,944) Change in cash 314 (12,578) (7,902) (8,380) (Bank indebtedness) cash - beginning of period (865) 2,801 7,351 (1,397) Bank indebtedness - end of period $ (551) $ (9,777) $ (551) $ (9,777) See accompanying notes to unaudited condensed consolidated interim financial statements. W A J A X C O R P O R A T I O N N O T E S T O C O N D E N S E D C O N S O L I D A T E D I N T E R I M F I N A N C I A L S T A T E M E N T S September 30, 2025 (unaudited, amounts in thousands of Canadian dollars, except share and per share data) 1. COMPANY PROFILE Wajax Corporation (the “Corporation”) is incorporated in Canada. The address of the Corporation’s registered head office is 10 Diesel Drive, Toronto, Ontario, Canada. The Corporation operates an integrated distribution system, providing sales, parts and services to a broad range of customers in diversified sectors of the Canadian economy, including: construction, forestry, mining, industrial and commercial, oil sands, transportation, metal processing, government and utilities, and oil and gas. 2. BASIS OF PREPARATION Statement of compliance These unaudited condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard (“IAS”) 34, Interim Financial Reporting and do not include al --- l of the disclosures required for annual consolidated financial statements. Accordingly, these unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements of the Corporation for the year ended December 31, 2024. The significant accounting policies follow those disclosed in the most recently reported audited consolidated financial statements. These unaudited condensed consolidated interim financial statements were authorized for issue by the Board of Directors on November 3, 2025. 3. CHANGE IN ACCOUNTING POLICIES During the year to date, the Corporation did not adopt any new accounting standards or amendments that had an impact on the Corporation's unaudited condensed consolidated interim financial statements. 4. BUSINESS ACQUISITIONS The Corporation made net post-acquisition settlement payments of $2,785 year to date (2024 - net receipts of $912). The payments related to holdback payments to the sellers of Polyphase Engineered Controls (1977) Ltd. (“Polyphase”) and Beta Fluid Power Ltd. and Beta Industrial Ltd. (“Beta”). The net receipts during the prior year related to cash received from the sellers of Polyphase and Beta for post- closing adjustments, partially offset by a holdback payment to the sellers of Beta. See Note 15 for contingent consideration liability balance and movement. 5. TRADE AND OTHER RECEIVABLES The Corporation’s trade and other receivables consist of trade accounts receivable from customers and other accounts receivable, generally from suppliers for warranty and rebates. Trade and other receivables are comprised of the following: September 30, 2025 December 31, 2024 Trade accounts receivable $ 269,958 $ 277,884 Less: allowance for credit losses (1,670) (2,271) Net trade accounts receivable $ 268,288 $ 275,613 Other receivables 19,219 27,924 Total trade and other receivables $ 287,507 $ 303,537 6. CONTRACT ASSETS AND LIABILITIES The following table provides information about contract assets and contract liabilities from contracts with customers: September 30, 2025 December 31, 2024 Contract assets $ 61,261 $ 55,588 Contract liabilities $ 21,131 $ 23,182 The contract assets relate to the Corporation's rights to consideration for work completed but not billed at the reporting date, primarily on product support and engineered repair services ("ERS") revenue. The contract assets are transferred to receivables when billed upon completion of significant milestones. The contract liabilities relate to the advance billing or advance consideration received from customers, primarily on equipment sales, industrial parts sales, and ERS revenue, for which revenue is recognized when control transfers to the customer. 7. INVENTORY The Corporation’s inventory balance consists of the following: September 30, 2025 December 31, 2024 Equipment $ 337,555 $ 377,205 Parts 229,545 257,623 Work-in-process 38,585 38,248 Total inventory $ 605,685 $ 673,076 All amounts shown are net of obsolescence provisions of $32,008 (December 31, 2024 - $30,814). As at September 30, 2025, the Corporation has included $32,523 (December 31, 2024 - $28,484) in equipment inventory related to short-term rental contracts, the majority of which is expected to convert to equipment sales within a six to twelve month period. Substantially all of the Corporation’s inventory is pledged as security for the bank credit facility (Note 14). 8. PROPERTY, PLANT AND EQUIPMENT & RENTAL EQUIPMENT --- Activity within property, plant and equipment included: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Balance at beginning of period $ 46,513 $ 45,863 $ 45,669 $ 44,829 Additions 1,230 2,276 6,164 6,745 Disposals - Net book value (282) (47) (571) (121) Transfer from leased to owned at end of lease — 530 603 1,440 Transfer from rental equipment 13 3 13 29 Depreciation charge (2,513) (2,261) (6,917) (6,558) Balance at end of period $ 44,961 $ 46,364 $ 44,961 $ 46,364 Activity within rental equipment included: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Balance at beginning of period $ 46,394 $ 45,411 $ 50,044 $ 42,490 Additions 272 8,999 3,812 25,145 Transfer to inventory - Net book value (177) (413) (766) (6,747) Transfer to property, plant and equipment (13) (3) (13) (29) Depreciation charge (3,150) (3,469) (9,751) (10,334) Balance at end of period $ 43,326 $ 50,525 $ 43,326 $ 50,525 9. RIGHT-OF-USE ASSETS Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Balance at beginning of period $ 154,862 $ 153,165 $ 158,473 $ 135,832 Additions 9,099 24,192 26,627 66,807 Disposals - Net book value (140) (213) (1,148) (1,592) Transfer from leased to owned at end of lease — (530) (603) (1,440) Disposal to lease receivables upon sublease (3,217) (3,353) (6,438) (10,481) Depreciation charge (8,988) (8,330) (25,295) (24,195) Balance at end of period $ 151,616 $ 164,931 $ 151,616 $ 164,931 10. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Accounts payable and accrued liabilities are comprised of the following: September 30, 2025 December 31, 2024 Trade payables $ 278,343 $ 333,314 Deferred rental income 814 680 Contingent consideration liability - current 3,125 3,280 Payroll, bonuses and incentives 34,727 35,842 Accrued liabilities 47,843 48,348 Accounts payable and accrued liabilities $ 364,852 $ 421,464 The Corporation has supplier finance arrangements with three third-party financing companies. Under these arrangements, the Corporation can purchase equipment from suppliers with interest-free payment terms ranging anywhere from approximately 45 days to 6 months, depending on the type of equipment and the financing company. After the interest-free period, the financing becomes interest bearing if the Corporation does not repay the principal borrowed. If the Corporation sells the equipment before payment is due, payment must then be remitted to the financing company. Comparable trade payables that are not part of a supplier finance arrangement usually have payment terms of approximately 30 days. As at September 30, 2025, supplier finance liabilities were $126,707 (December 31, 2024 - $166,887) and are included in trade payables above. Under the terms of the Corporation’s bank credit facility, the Corporation is permitted to have additional interest bearing equipment inventory financing of up to $25,000. The interest bearing portion of the supplier finance liabilities was $24,965 as at September 30, 2025 (December 31, 2024 - $12,522). 11. LEASE LIABILITIES AND LEASE RECEIVABLES As lessee The Corporation leases properties for its branch network, certain vehicles, machinery and IT equipment. The change in lease liabilities is as follows: Three months ended September 30 Nine months ended September 30 Note 2025 2024 2025 2024 Balance at beginning of period $ 203,094 $ 197,674 $ 208,182 $ 175,374 Changes from operating cash flows Finance costs paid on lea --- se liabilities (2,724) (2,658) (8,171) (7,807) Changes from financing cash flows Payment of lease liabilities (11,623) (10,189) (32,676) (28,961) Other changes Interest expense 20 2,724 2,658 8,171 7,807 New leases, net of disposals 8,707 24,015 24,672 65,087 Balance at end of period $ 200,178 $ 211,500 $ 200,178 $ 211,500 Current portion $ 42,464 $ 39,322 $ 42,464 $ 39,322 Non-current portion $ 157,714 $ 172,178 $ 157,714 $ 172,178 Not included in the balance of lease liabilities are short-term leases, leases of low-value assets and variable lease payments not linked to an index. Variable lease payments, lease payments associated with short-term leases and leases of low-value assets are expensed as incurred in the condensed consolidated interim statements of earnings. As lessor Operating leases The Corporation rents equipment to customers under rental agreements with terms of up to 5 years. The rentals have been assessed and classified as operating leases. Revenue is presented as equipment rental revenue and recognized evenly over the term of the rental agreement. Finance leases The Corporation subleases certain equipment to customers. The Corporation assesses and classifies its subleases as finances leases, and therefore derecognizes the right-of-use assets relating to the respective head leases, recognizes lease receivables equal to the net investment in the subleases, and retains the previously recognized lease liabilities in its capacity as lessee. 12. EMPLOYEE BENEFITS The Corporation sponsored four pension plans: two defined contribution plans - the Wajax Limited Defined Contribution Pension Plan (the "Employees’ Plan”) and the Simplified Pension Plan (the "SP Plan") for employees resident in the province of Québec; and two defined benefit plans - the Pension Plan for Executive Employees of Wajax Limited (the “Executive Plan”) and the Wajax Limited Supplemental Executive Retirement Plan (the “SERP”). During the year, the Corporation contributed $2,902 to the Executive Plan to fully fund the plan prior to purchasing buyout annuities from a third-party financial services company at a cost of $6,830. As a result of the annuities purchase, the third-party financial services company was responsible for the payment of Executive Plan members’ pension benefits starting May 1, 2025, and the Corporation settled its defined benefit obligation in respect of all such plan members. As a result of the settlement, the Executive Plan assets and benefit obligation declined by $6,830 and $6,372, respectively, resulting in a loss on settlement of $458 which the Corporation recorded in the condensed consolidated interim statements of earnings during the year. In addition, the settlement triggered a January 31, 2025 re-measurement of the Executive Plan for any pre-settlement changes in assumptions, plan asset return experience and other experience adjustments, resulting in a re-measurement loss of $41, net of tax, recognized in other comprehensive income during the year in the condensed consolidated interim statements of comprehensive income. As at September 30, 2025, the employee benefits liability of $4,085 (December 31, 2024 - $6,526) consists of a net pension asset of $113 (December 31, 2024 - net pension liability of $2,188) relating to the Executive Plan and a pension liability of $4,198 (December 31, 2024 - $4,338) relating to the SERP, which is not funded. 13. DEBENTURES Senior Unsecured Debentures - 6%, due January 15, 2025 In December 2019, --- the Corporation issued $57,000 in unsecured subordinated debentures with a term of five years due January 15, 2025. These debentures bore a fixed interest rate of 6.00% per annum, payable semi-annually on January 15 and July 15 of each year. On January 15, 2025, the Corporation repaid in full the $57,000 in principal amount owed under its senior unsecured debentures, along with accrued interest up to but excluding the maturity date. The Corporation used borrowings under its bank credit facility to complete the repayment. The following balances were outstanding: September 30, 2025 December 31, 2024 Debentures issued $ — $ 57,000 Deferred financing costs, net of accumulated amortization — (27) Total debentures $ — $ 56,973 Current portion $ — $ 56,973 Non-current portion $ — $ — Movements in the debentures balance were as follows: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Balance at beginning of period $ — $ 56,650 $ 56,973 $ 56,340 Repayment of debentures — — (57,000) — Amortization of deferred financing costs — 160 27 470 Balance at end of period $ — $ 56,810 $ — $ 56,810 Finance costs on the debentures were nil during the quarter (2024 - $1,029) and $157 year to date (2024 - $3,025). 14. LONG-TERM DEBT As at September 30, 2025, Wajax had a $500,000 credit limit on its bank credit facility, composed of a $50,000 non-revolving term facility and a $450,000 revolving term facility, maturing on October 1, 2027. As at September 30, 2025, borrowings under the bank credit facility bear floating rates of interest at margins over Canadian dollar term Canadian Overnight Repo Rate Average (“CORRA”) loan yields, U.S. dollar Secured Overnight Financing Rate (“SOFR”) rates or prime. Margins on the facility depend on the Corporation’s leverage ratio at the time of borrowing and range between 1.8% and 3.3% for Canadian dollar term CORRA loans and U.S. dollar SOFR borrowings, and between 0.8% and 2.3% for prime rate borrowings. As at September 30, 2025, borrowing capacity under the bank credit facility is dependent upon the level of the Corporation’s inventory on hand and the outstanding trade accounts receivable. As at September 30, 2025, borrowing capacity under the bank credit facility was $500,000 (December 31, 2024 - $500,000), of which $215,592 (December 31, 2024 - $212,574) was accessible to the Corporation. In addition, the bank credit facility contains customary restrictive covenants, including limitations on paying cash dividends and acquiring businesses in the event the senior secured leverage ratio, as defined in the bank credit facility agreement, exceeds 4.0 times, and an interest coverage maintenance ratio, all of which were met as at September 30, 2025. Subsequent to September 30, 2025, the Corporation amended its bank credit facility. See Note 24 Subsequent Events for details of the amendments. The following balances were outstanding: September 30, 2025 December 31, 2024 Bank credit facility Non-revolving term portion $ 50,000 $ 50,000 Revolving term portion 230,551 233,749 $ 280,551 $ 283,749 Deferred financing costs, net of accumulated amortization (484) (707) Total long-term debt $ 280,067 $ 283,042 On January 15, 2025, the Corporation used borrowings under its bank credit facility to complete the repayment of its $57,000 senior unsecured debentures. See Note 13 for further details on the debentures repayment. The Corporation had $3,857 (December 31, 2024 - $3,677) letters of credit outstandin --- g at the end of the period. Finance costs on long-term debt amounted to $4,167 during the quarter (2024 - $5,422) and $13,977 year to date (2024 - $15,914). Movements in the long-term debt balance were as follows: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Balance at beginning of period $ 275,343 $ 280,511 $ 283,042 $ 267,755 Changes from financing cash flows Net proceeds (repayments) of borrowings 1,028 44,967 (2,114) 55,978 Impact of the change in foreign exchange rates 3,621 (2,117) (1,084) (260) Transaction costs related to borrowings — (33) — (472) Other changes Amortization of deferred financing costs 75 168 223 495 Balance at end of period $ 280,067 $ 323,496 $ 280,067 $ 323,496 15. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT The Corporation uses the following fair value hierarchy for determining and disclosing the fair value of financial instruments: • Level 1 - unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2 - other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly. • Level 3 - techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable market data. The Corporation categorizes its financial instruments as follows: September 30, 2025 December 31, 2024 Financial assets measured at amortized cost: Cash $ — $ 7,351 Trade and other receivables 287,507 303,537 Contract assets 61,261 55,588 Lease receivables 25,804 26,600 Financial liabilities measured at amortized cost: Bank indebtedness 551 — Accounts payable and accrued liabilities (excluding contingent consideration) 361,727 418,184 Provisions 7,291 7,172 Dividends payable 7,611 7,629 Other liabilities (excluding contingent consideration) 1,945 2,285 Debentures — 56,973 Long-term debt 280,067 283,042 Financial assets measured at fair value: Derivative financial assets 6,126 15,101 Financial liabilities measured at fair value: Contingent consideration (in accounts payable and accrued liabilities) 3,125 3,280 Contingent consideration (in other liabilities) 1,471 4,619 Derivative financial liabilities 3,992 8,898 The Corporation measures financial assets and financial liabilities at amortized cost, except for derivative financial assets/liabilities and contingent consideration from acquisitions, which are measured at fair value. Changes in fair value are recognized in the condensed consolidated interim statements of earnings except for changes in fair value related to derivative financial assets/liabilities which are effectively designated as hedging instruments which are recognized in other comprehensive income. The Corporation's derivative financial assets/liabilities are held with major Canadian chartered banks and are deemed to be Level 2 financial instruments. The Corporation's contingent consideration liabilities are Level 3 financial instruments, and are valued using either a discounted cash flow model or a Monte Carlo simulation model. The Monte Carlo simulation uses various assumptions including EBITDA forecast, discount rate, and volatility factor. The fair value of long-term debt approximates its recorded value due to its floating interest rate. The fair value of lease receivables approximates its carrying value. The fair value of the debentures can be estimated based on the trading price of the debentures, which takes into account the Corpora --- tion's own credit risk. On January 15, 2025, the Corporation repaid its debentures in full. At December 31, 2024, the Corporation had estimated the fair value of its debentures to be $57,000. The fair values of all other financial assets and liabilities approximate their recorded values due to the short-term maturities of these instruments. Movements in the contingent consideration liability were as follows: Amount Contingent consideration liability, December 31, 2023 $ 9,429 Contingent consideration paid - QT Valve & Supply Limited (2021) (113) Contingent consideration paid - Beta (641) Contingent consideration paid - Polyphase (3,039) Revaluation of contingent consideration - Polyphase 2,263 Contingent consideration liability, December 31, 2024 $ 7,899 Contingent consideration paid - Process Flow Systems Ltd. (2022) (650) Contingent consideration paid - Polyphase (2,653) Contingent consideration liability, September 30, 2025 $ 4,596 Current portion (in accounts payable and accrued liabilities) $ 3,125 Non-current portion (in other liabilities) $ 1,471 Derivative financial instruments and hedges The Corporation enters into interest rate swaps to hedge the risk associated with interest rate fluctuations on its variable rate debt. Interest rate swaps are initially recognized on the date the derivative contracts are entered into, and are subsequently re-measured at their fair values. The method of recognizing the resulting gain or loss depends on whether the derivative is designated as a hedging instrument. In a cash flow hedging relationship, the effective portion of the change in the fair value of the hedging derivative, net of taxes, is recognized in other comprehensive income while the ineffective portion is recognized within net earnings. Amounts in accumulated other comprehensive income are reclassified to net earnings in the periods when the hedged item affects profit or loss. During the second quarter of 2023, the Corporation discontinued its application of hedge accounting relating to its interest rate swaps. The derivatives continue to be carried at fair value in the condensed consolidated interim statements of financial position with changes in fair value recognized in finance costs in the condensed consolidated interim statements of earnings. Amounts previously accumulated in accumulated other comprehensive income prior to discontinuance are being amortized to finance costs over the remaining term of the underlying forecasted interest payments. The Corporation recognized a loss of $253 during the quarter (2024 - loss of $4,171) and a loss of $820 year to date (2024 - loss of $3,763) in the condensed consolidated interim statements of earnings associated with its interest rate swaps, and an after-tax loss of $177 during the quarter (2024 - after-tax loss of $177) and an after-tax loss of $531 year to date (2024 - after-tax loss of $531) in other comprehensive income. The Corporation’s interest rate swaps outstanding are summarized as follows: Notional Amount Weighted Average Interest Rate Maturity As at September 30, 2025: $ 150,000 2.57 % October 2027 As at December 31, 2024: $ 150,000 2.57 % October 2027 The Corporation enters into short-term foreign exchange forwards to hedge the exchange risk associated with the cost of certain inbound inventory and certain foreign currency-denominated sales to customers along with the associated receivables as part of its normal course of business. Foreign exchange forwards are initially r --- ecognized on the date the derivative contract is entered into and are subsequently re-measured at their fair values. The method of recognizing the resulting gain or loss depends on whether the derivative is designated as a hedging instrument. In a cash flow hedging relationship, the effective portion of the change in the fair value of the hedging derivative, net of taxes, is recognized in other comprehensive income while the ineffective portion is recognized in the condensed consolidated interim statements of earnings within gross profit. Amounts in accumulated other comprehensive income are reclassified to net earnings in the periods when the hedged item affects profit or loss. The Corporation recognized a gain of $525 in the quarter (2024 - loss of $319) and a loss of $375 year to date (2024 - gain of $1,023) associated with its foreign exchange forwards in the condensed consolidated interim statements of earnings, and an after-tax gain of $1,040 in the quarter (2024 - after-tax loss of $827) and an after-tax loss of $2,104 year to date (2024 - after-tax gain of $1,103) in other comprehensive income. The Corporation’s contracts to buy and sell foreign currencies are summarized as follows: September 30, 2025 Notional Amount Average Exchange Rate Maturity Purchase contracts USD 147,302 1.3778 October 2025 to March 2027 EUR 36 1.5519 October 2025 AUD 2,932 0.9000 October 2025 to December 2025 Sales contracts USD 66,158 1.3663 December 2025 to April 2027 EUR 3,997 1.5718 October 2025 to August 2026 December 31, 2024 Notional Amount Average Exchange Rate Maturity Purchase contracts USD 164,165 1.3705 January 2025 to August 2026 EUR 756 1.5001 January 2025 to March 2025 AUD 7,269 0.9078 January 2025 to December 2025 Sales contracts USD 87,306 1.3507 January 2025 to May 2026 EUR 973 1.4774 January 2025 to November 2025 The Corporation has certain total return swaps to hedge the exposure associated with increases in its share price on its outstanding restricted share units ("RSUs"). The Corporation does not apply hedge accounting to these relationships and as such, any gain or loss arising from marking these derivatives to market are recognized in the condensed consolidated interim statements of earnings within selling and administrative expenses in the period in which they arise. As at September 30, 2025, the Corporation's total return swaps cover 426,000 of the Corporation's underlying common shares (December 31, 2024 - 366,000), and expire between March 2026 and March 2028. During the year to date, the Corporation settled a total return swap contract for 112,000 shares (2024 - 147,000 shares), resulting in a cash payment of $415 (2024 - cash receipt of $1,896). The Corporation recognized a gain of $571 during the quarter (2024 - loss of $20) and a gain of $1,370 year to date (2024 - loss of $1,610) associated with its total return swaps in the condensed consolidated interim statements of earnings. A portion of borrowings under the revolving term portion of the bank credit facility are denominated in US currency. Concurrent with these issuances, the Corporation enters into cross currency swaps to obtain a more favourable interest rate, while mitigating any foreign exchange risk associated with these revolving borrowings. As such, foreign exchange losses and gains relating to the underlying USD borrowings from the revolving credit facility are offset by gains and losses on the cross currency swap derivatives. The Corporation does not apply h --- edge accounting to these relationships and as such, foreign exchange gains and losses arising from marking these derivatives to market are recognized in earnings in the period in which they arise, offsetting any foreign exchange gains and losses recognized on the long-term debt. The Corporation recognized a gain of $3,621 during the quarter (2024 - loss of $2,117) and a loss of $1,084 year to date (2024 - loss of $260) associated with its cross currency swaps in the condensed consolidated interim statements of earnings. See Note 14 Long-Term Debt for details on the offsetting impact of the change in foreign exchange rates relating to the underlying USD borrowings from the revolving credit facility. The Corporation’s cross currency swaps are summarized as follows: Receive Notional Amount Receive Rate Pay Notional Amount Pay Rate Maturity As at September 30, 2025: USD 145,497 5.1868 % CAD 200,000 5.0090 % October 2025 As at December 31, 2024: USD 162,441 5.9418 % CAD 230,000 5.6394 % January 2025 Derivative financial assets consist of: September 30, 2025 December 31, 2024 Interest rate swaps $ 419 $ 1,676 Foreign exchange forwards 2,443 9,795 Total return swaps 718 — Cross currency swaps 2,546 3,630 Total derivative financial assets $ 6,126 $ 15,101 Current portion $ 4,993 $ 13,403 Non-current portion $ 1,133 $ 1,698 Derivative financial liabilities consist of: September 30, 2025 December 31, 2024 Interest rate swaps $ 284 $ — Foreign exchange forwards 2,330 6,453 Total return swaps 1,378 2,445 Total derivative financial liabilities $ 3,992 $ 8,898 Current portion $ 2,295 $ 5,313 Non-current portion $ 1,697 $ 3,585 Movements in the net derivative financial assets (liabilities) balance are as follows: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Opening net derivative financial (liability) asset $ (3,501) $ 6,405 $ 6,203 $ 4,146 Gain (loss) recognized in net earnings 4,464 (6,627) (909) (4,610) Gain (loss) recognized in other comprehensive income 1,171 (1,362) (3,575) 776 Cash paid (received) on settlement of total return swaps — — 415 (1,896) Ending net derivative financial asset (liability) $ 2,134 $ (1,584) $ 2,134 $ (1,584) The balance in accumulated other comprehensive income is comprised of the fair value of the Corporation's various foreign exchange forwards where hedge accounting is applied, and the remaining unamortized fair value of the Corporation’s interest rate swaps where hedge accounting was applied, prior to discontinuance of hedge accounting. These accumulated amounts will be continuously released to the condensed consolidated interim statements of earnings within gross profit and finance costs, respectively. During the periods presented and cumulatively to date, changes in counterparty credit risk have not significantly contributed to the overall changes in the fair value of these derivative instruments. 16. SHARE CAPITAL AND EARNINGS PER SHARE The Corporation is authorized to issue an unlimited number of no par value common shares and an unlimited number of no par value preferred shares. Each common share entitles the holder of record to one vote at all meetings of shareholders. All issued common shares are fully paid. There were no preferred shares outstanding as at September 30, 2025 (December 31, 2024 - nil). Each common share represents an equal beneficial interest in any distributions of the Corporation and in the net assets of the Corporation in the event of its termination or --- winding-up. Number of Common Shares Amount Issued and outstanding, December 31, 2024 and September 30, 2025 21,908,689 $ 212,526 Shares held in trust, December 31, 2024 (112,773) $ (1,073) Released for settlement of certain share-based compensation awards 23,367 222 Purchased for future settlement of certain share-based compensation awards (73,598) (714) Shares held in trust, September 30, 2025 (163,004) $ (1,565) Issued and outstanding, net of shares held in trust, September 30, 2025 21,745,685 $ 210,961 Number of Common Shares Amount Issued and outstanding, December 31, 2023 21,810,411 $ 211,337 Common shares issued to settle share-based compensation awards 34,574 283 Issued and outstanding, September 30, 2024 21,844,985 $ 211,620 Shares held in trust, December 31, 2023 (140,865) $ (1,333) Released for settlement of certain share-based compensation awards 57,511 545 Purchased for future settlement of certain share-based compensation awards (29,419) (285) Shares held in trust, September 30, 2024 (112,773) $ (1,073) Issued and outstanding, net of shares held in trust, September 30, 2024 21,732,212 $ 210,547 Dividends declared During the quarter, the Corporation declared cash dividends of $0.35 per share or $7,611 (2024 - dividends of $0.35 per share or $7,606). During the nine months ended September 30, 2025, the Corporation declared cash dividends of $1.05 per share or $22,859 (2024 - dividends of $1.05 per share or $22,802). As at September 30, 2025, the Corporation had $7,611 (December 31, 2024 - $7,629) dividends outstanding which were paid on October 2, 2025. Earnings per share The following table sets forth the computation of basic and diluted earnings per share: 2025 2024 2025 2024 Numerator for basic and diluted earnings per share: – net earnings $ 16,730 $ 6,399 $ 45,333 $ 41,759 Denominator for basic earnings per share: – weighted average shares, net of shares held in trust 21,745,685 21,723,944 21,767,794 21,701,141 Denominator for diluted earnings per share: – weighted average shares, net of shares held in trust 21,745,685 21,723,944 21,767,794 21,701,141 – effect of dilutive share units 544,189 532,664 437,952 547,400 Denominator for diluted earnings per share 22,289,874 22,256,608 22,205,746 22,248,541 Basic earnings per share $ 0.77 $ 0.29 $ 2.08 $ 1.92 Diluted earnings per share $ 0.75 $ 0.29 $ 2.04 $ 1.88 Three months ended September 30 Nine months ended September 30 For the quarter, the calculation above excludes 26,090 anti-dilutive share units (2024 – 42,485). For the year to date, the calculation above excludes 43,891 anti-dilutive share units (2024 – 42,237). 17. SHARE-BASED COMPENSATION PLANS The Corporation has four share-based compensation plans: the Wajax Share Ownership Plan (the “SOP”), the Directors’ Deferred Share Unit Plan (the “DDSUP”), the Mid-Term Incentive Plan for Senior Executives (the “MTIP”) and the Deferred Share Unit Plan (the “DSUP”). The following table provides the share-based compensation expense for awards under all plans: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Treasury share units plans SOP equity-settled $ 17 $ 21 $ 50 $ 63 DDSUP equity-settled 249 242 733 784 Total treasury share units plans expense $ 266 $ 263 $ 783 $ 847 Market-purchased share units plans MTIP equity-settled $ 588 $ 466 $ 1,755 $ 1,621 DSUP equity-settled 49 26 115 65 Total market-purchased share units plans expense $ 637 $ 492 $ 1,870 $ 1,686 Cash-settled units plans MTIP cas --- h-settled $ 961 $ 743 $ 2,299 $ 3,266 DSUP cash-settled 9 — 21 (8) Total cash-settled units plans expense $ 970 $ 743 $ 2,320 $ 3,258 Total share-based compensation expense $ 1,873 $ 1,498 $ 4,973 $ 5,791 a) Treasury share units plans Under the SOP and the DDSUP, units are issued to the participants which are settled by issuing Wajax Corporation shares for no cash consideration. Units under the SOP vest over three years, while units under the DDSUP vest immediately. Vested units are settled when the participant is no longer employed by the Corporation or one of its subsidiary entities or no longer sits on its Board. Whenever dividends are paid on the Corporation’s shares, additional units (dividend equivalents) with a value equal to the dividends are credited to the participants’ accounts. The following units under these plans are outstanding: Number of Units Fair Value at Time of Grant Outstanding at December 31, 2024 360,761 $ 5,654 Grants – new grants 43,565 933 – dividend equivalents 19,322 — Outstanding at September 30, 2025 423,648 $ 6,587 At September 30, 2025, 414,838 share units were vested (December 31, 2024 - 347,420 share units were vested). The outstanding aggregate number of shares issuable to satisfy entitlements under these plans is as follows: Number of Shares Approved by shareholders 1,650,000 Exercised to date (736,655) Units outstanding (423,648) Available for future grants at September 30, 2025 489,697 b) Market-purchased share units plans The MTIP plan consists of cash-settled restricted share units ("RSUs") and equity-settled performance share units ("PSUs"), and the equity-settled DSUP plan consists of deferred share units ("DSUs"). Market-purchased share units plans consist of PSUs under the MTIP plan and DSUs, which vest over three years and are settled in common shares of the Corporation on a one-for-one basis. DSUs are only subject to time-vesting, whereas PSUs are also subject to performance vesting. PSUs are comprised of two types: • Total shareholder return (“TSR”) PSUs: TSR PSUs vest dependent upon the attainment of a TSR market condition. Such performance vesting criteria result in a performance vesting factor that ranges from 0% to 200% depending on the Corporation's TSR relative to a pre-selected group of peers. • Return on invested capital (“ROIC”) PSUs: ROIC PSUs vest dependent upon the attainment of a target level of return on invested capital. Such performance vesting criteria results in a performance vesting factor that ranges from 0% to 150% depending on the level of ROIC attained. These plans are settled through shares purchased on the open market by the employee benefit plan trust, subject to the attainment of their vesting conditions. PSUs are settled at the end of the vesting period, and the number of shares remitted to the participant upon settlement is equal to the number of PSUs awarded multiplied by the performance vesting factor less shares withheld to satisfy the participant's withholding tax requirement. DSUs are settled when the participant is no longer employed by the Corporation or one of its subsidiary entities. Whenever dividends are paid on the Corporation’s shares, additional units with a value equal to the dividends are credited to the participants’ accounts with the same vesting conditions as the original PSUs and DSUs. The following units under these plans are outstanding: Number of Units Fair Value at Time of Grant Outstanding at December 31, 2024 232,458 $ 6,188 Grants – ne --- w grants 184,084 3,877 – dividend equivalents 15,598 — Forfeitures (42,902) (958) Settlements (47,641) (827) Outstanding at September 30, 2025 341,597 $ 8,280 PSUs granted in 2022 were vested and settled in March 2025. Performance condition achievement resulted in a reduction of 36,695 TSR PSUs (included in the ‘Forfeitures’ line above), and an increase of 10,961 ROIC PSUs (included in the ‘Grants’ lines above). After performance condition achievement, 47,641 earned PSUs relating to the 2022 MTIP grant were settled in March 2025 by releasing and delivering to participants a total of 23,367 common shares from the trust, net of withholding tax. See Note 16 for details on share movements. At September 30, 2025, 22,012 outstanding units were vested (December 31, 2024 - 20,902 units were vested). All vested units are DSUs. c) Cash-settled units plans Cash-settled units plans consist of MTIP RSUs and cash-settled DSUs. Compensation expense varies with the price of the Corporation's shares and is recognized over the three year vesting period. RSUs are settled at the end of the vesting period, whereas DSUs are settled when the participant is no longer employed by the Corporation or one of its subsidiary entities. Whenever dividends are paid on the Corporation’s shares, additional units with a value equal to the dividends are credited to the participants’ accounts with the same vesting conditions as the original units. The value of the payout is equal to the number of units awarded including earned dividend equivalents, multiplied by the volume weighted average share price at the time of vesting. At September 30, 2025, the carrying amount of the liabilities for these plans was $4,554 (December 31, 2024 – $5,235). The following units under these plans were outstanding: Number of Units Outstanding at December 31, 2024 402,430 Grants – new grants 175,026 – dividend equivalents 20,907 Forfeitures (23,228) Settlements (147,545) Outstanding at September 30, 2025 427,590 At September 30, 2025, 4,688 outstanding units were vested (December 31, 2024 - 4,452 units were vested). 18. REVENUE Disaggregation of revenue In the following table, revenue is disaggregated by revenue type: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Equipment sales $ 131,323 $ 131,666 $ 478,901 $ 410,165 Product support 122,930 123,101 402,774 402,284 Industrial parts 136,393 136,362 422,187 438,402 Engineered repair services (ERS) 80,822 78,120 246,451 247,382 Revenue from contracts with customers $ 471,468 $ 469,249 $ 1,550,313 $ 1,498,233 Equipment rental 11,677 11,771 34,940 33,436 Total $ 483,145 $ 481,020 $ 1,585,253 $ 1,531,669 The Corporation has included $2,690 during the quarter (2024 - $4,886) and $6,386 year to date (2024 - $15,743) in equipment sales related to short-term rental contracts that are expected to convert to equipment sales within a six to twelve month period. 19. RESTRUCTURING AND OTHER RELATED COSTS In the second quarter of 2025, the Corporation implemented a workforce reduction in response to economic conditions. A restructuring cost of $3,846 was recognized in the year to date relating primarily to severance. 20. FINANCE COSTS Finance costs are comprised of the following: Three months ended September 30 Nine months ended September 30 Note 2025 2024 2025 2024 Interest on long-term debt 14 $ 4,167 $ 5,422 $ 13,977 $ 15,914 Unrealized loss on interest rate swaps 15 253 4,171 820 3,763 Interest on debentures 13 — 1,029 --- 157 3,025 Interest on lease liabilities 11 2,724 2,658 8,171 7,807 Interest income on lease receivables (321) (269) (994) (724) Finance costs $ 6,823 $ 13,011 $ 22,131 $ 29,785 21. INCOME TAX EXPENSE Income tax expense comprises current and deferred tax as follows: For the nine months ended September 30 2025 2024 Current income tax expense $ 17,574 $ 15,186 Deferred income tax recovery (1,655) (1,376) Income tax expense $ 15,919 $ 13,810 The calculation of current tax is based on a combined federal and provincial statutory income tax rate of 26.0% (2024 – 26.0%). Deferred tax assets and liabilities are measured at tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax assets and liabilities have been measured using an expected average combined statutory income tax rate of 26.0% based on the tax rates in years when the temporary differences are expected to reverse. The Corporation is subject to the global minimum tax under Pillar Two tax legislation. The global minimum top-up tax recognized in current income tax expense for the nine months ended September 30, 2025 is nil. The Corporation has applied a temporary mandatory relief from deferred tax accounting for the impacts of the top-up tax and accounts for it as a current tax when it is incurred. The reconciliation of income taxes at Canadian statutory rates to the reported income tax expense is as follows: For the nine months ended September 30 2025 2024 Combined statutory income tax rate 26.0 % 26.0 % Expected income tax expense at statutory rates $ 15,926 $ 14,448 Non-deductible expenses 545 625 Changes in estimates related to prior years (360) (920) Other (192) (343) Income tax expense $ 15,919 $ 13,810 22. CHANGES IN NON-CASH OPERATING WORKING CAPITAL The net change in non-cash operating working capital comprises the following: Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Trade and other receivables $ (7,461) $ 16,012 $ 14,497 $ 43,455 Contract assets (1,375) 6,174 (5,673) 16,379 Inventory (3,020) 1,171 68,157 (86,403) Deposits on inventory (6,824) 3,453 (3,803) (8,335) Prepaid expenses 949 2,828 417 (4,401) Accounts payable and accrued liabilities (1,882) (76,034) (53,368) (33,428) Provisions (726) (210) 119 53 Contract liabilities 3,899 (1,000) (2,051) 5,421 Total $ (16,440) $ (47,606) $ 18,295 $ (67,259) The change in inventory above excludes transfers of rental equipment to inventory of $177 during the quarter (2024 - $413) and $766 year to date (2024 - $6,747). 23. COMPARATIVE INFORMATION A change in presentation during the year to date resulted in the reclassification of cross currency swaps within the condensed consolidated interim statements of financial position, from accounts payable and accrued liabilities to derivative financial assets or liabilities. Accordingly, certain comparative information has been reclassified to conform to the current year’s presentation. 24. SUBSEQUENT EVENTS On November 3, 2025, the Corporation declared a fourth quarter 2025 dividend of $0.35 per share. On October 24, 2025, the Corporation amended its senior secured bank credit facility to extend the maturity date from October 1, 2027 to October 24, 2029. There was no change to the credit limit of the facility, but the additional interest-bearing debt limit of $25,000 was increased to $50,000. Effective October 24, 2025, the margins range between 1.5% and 3.3% for Canadian dollar term CORRA l --- oans and U.S. dollar SOFR borrowings, and between 0.5% and 2.3% for prime rate borrowings.