UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

☒ Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended June 3029, ~~2024~~2025.

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number 0-25150

STRATTEC SECURITY CORPORATION

(Exact name of registrant as specified in its charter)


Wisconsin		39-1804239
(State of Incorporation)		(I.R.S. Employer Identification No.)

3333 West Good Hope Road, Milwaukee, WI 53209

(Address of principal executive offices)

Registrant’s telephone number, including area code: (414) 247-3333

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of exchange on which registered
Common Stock, $.01 par value	STRT	The NASDAQ Stock Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐Yes ☒No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐Yes ☒No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒Yes ☐No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒Yes ☐No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller Reporting Company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the Registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the Registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐Yes ☒No

The aggregate market value of the voting Common Stock held by non-affiliates of the registrant as of December 2927, ~~2023~~2024 (the last business day of the Registrant’s most recently completed second quarter), was approximately $96135,~~493~~807,~~000~~533 (based upon the last reported sale price of the Common Stock at December 2927, ~~2023~~2024 on the NASDAQ Global Market). Shares of common stock held by any executive officer or director of the registrant have been excluded from this computation because such persons may be deemed to be affiliates. This determination of affiliate status is not a conclusive determination for other purposes.

On August 21, ~~2024~~2025, there were outstanding 4,~~068~~161,~~052~~334 shares of the Registrant’s $.01 par value Common Stock (which includes any unvested restricted shares previously awarded).

Documents Incorporated by Reference

Part III of this report incorporates information by reference from ~~registrant~~Registrant's Proxy Statement for the annual meeting of its shareholders to be held on October 2315, ~~2024~~2025.

STRATTEC SECURITY CORPORATION

~~ANNUAL~~TABLE ~~REPORT~~OF ~~IN FORM 10-K~~CONTENTS

June 3029, ~~2024~~2025

		Page
PART I		2
Item 1.	~~BUSINESS~~Business	2
Item 1A.	~~RISK~~Risk ~~FACTORS~~Factors	108
Item 1B.	~~UNRESOLVED~~Unresolved ~~STAFF~~Staff ~~COMMENTS~~Comments	1614
ITEM 1C.	~~CYBERSECURITY~~Cybersecurity	1614
Item 2.	~~PROPERTIES~~Properties	1614
Item 3.	~~LEGAL~~Legal ~~PROCEEDINGS~~Proceedings	1714
Item 4.	~~MINE~~Mine ~~SAFETY~~Safety ~~DISCLOSURES~~Disclosures	1715
PART II		18
Item 5.	~~MARKET~~Market ~~FOR~~for ~~THE~~Registrant's ~~REGISTRANT’S~~Common ~~COMMON EQUITY~~Equity, ~~RELATED~~Related ~~STOCKHOLDER~~Stockholder ~~MATTERS~~Matters, ~~AND~~and ~~ISSUER~~Issuer ~~PURCHASES~~Purchases OFof ~~EQUITY~~Equity ~~SECURITIES~~Securities	1816
Item 6.	[~~RESERVED~~Reserved]	1816
Item 7.	~~MANAGEMENT’S~~Management's ~~DISCUSSION~~Discussion ~~AND~~and ~~ANALYSIS~~Analysis OFof ~~FINANCIAL~~Financial ~~CONDITION~~Condition ~~AND~~and ~~RESULTS~~Results OFof ~~OPERATIONS~~Operations	1917
Item 7A.	~~QUANTITATIVE~~Quantitative ~~AND~~and ~~QUALITATIVE~~Qualitative ~~DISCLOSURES~~Disclosures ~~ABOUT~~about ~~MARKET~~Market ~~RISK~~Risk	2621
Item 8.	~~FINANCIAL~~Financial ~~STATEMENTS~~Statements ~~AND~~and ~~SUPPLEMENTARY~~Supplementary ~~DATA~~Data	2722
Item 9.	~~CHANGES~~Changes INin ~~AND~~and ~~DISAGREEMENTS~~Disagreements ~~WITH~~with ~~ACCOUNTANTS~~Accountants ONon ~~ACCOUNTING~~Accounting ~~AND~~and ~~FINANCIAL~~Financial ~~DISCLOSURE~~Disclosure	5545
Item 9A.	~~CONTROLS~~Controls ~~AND~~and ~~PROCEDURES~~Procedures	5545
Item 9B.	~~OTHER~~Other ~~INFORMATION~~Information	5847
Item 9C.	~~DISCLOSURE~~Disclosure ~~REGARDING~~Regarding ~~FOREIGN~~Foreign ~~JURISDICTIONS~~Jurisdictions ~~THAT~~that ~~PREVENT~~Prevent ~~INSPECTIONS~~Inspections	5847
PART III		59
Item 10.	~~DIRECTORS~~Directors, ~~EXECUTIVE~~Executive ~~OFFICERS~~Officers, ~~AND~~and ~~CORPORATE~~Corporate ~~GOVERNANCE~~Governance	5948
Item 11.	~~EXECUTIVE~~Executive ~~COMPENSATION~~Compensation	5948
Item 12.	~~SECURITY~~Security ~~OWNERSHIP~~Ownership OFof ~~CERTAIN~~Certain ~~BENEFICIAL~~Beneficial ~~OWNERS~~Owners ~~AND~~and ~~MANAGEMENT~~Management ~~AND~~and ~~RELATED~~Related ~~SHAREHOLDER~~Stockholder ~~MATTERS~~Matters	5948
Item 13.	~~CERTAIN~~Certain ~~RELATIONSHIPS~~Relationships ~~AND~~and ~~RELATED~~Related ~~TRANSACTIONS,~~Transactions ~~AND~~and ~~DIRECTOR~~Director ~~INDEPENDENCE~~Independence	5948
Item 14.	~~PRINCIPAL~~Principal ~~ACCOUNTANT~~Accounting ~~FEES~~Fees ~~AND~~and ~~SERVICES~~Services	5948
PART IV		60
Item 15.	~~EXHIBITS~~Exhibits ~~AND~~and ~~FINANCIAL~~Financial ~~STATEMENT~~Statement ~~SCHEDULES~~Schedules	6049
ITEM 16.	~~FORM~~Form 10-K ~~SUMMARY~~Summary	6252
SIGNATURES		63
	Signatures	53

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

AIn ~~number~~this ofAnnual ~~the~~Report ~~matters~~on ~~and subject areas discussed in this~~ Form 10-K asfor ~~well~~Strattec asSecurity inCorporation ~~portions~~("Strattec," of "the Company~~’s Proxy Statement~~," ~~dated September 20~~"we," ~~2024~~"us," ~~which~~or ~~is incorporated herein by reference~~"our"), ~~contain “forward-looking~~ statements” ~~within~~that ~~the~~are ~~meaning~~not ofreported ~~the~~financial ~~Private~~results ~~Securities~~or ~~Litigation~~other ~~Reform~~historic ~~Act~~information ofare ~~1995. These~~"forward-looking statements." ~~may~~These beforward-looking ~~identified~~statements byrelate ~~the~~to, ~~use~~among ofother ~~forward-looking~~things, ~~words~~the orCompany's ~~phrases~~future ~~such~~financial ~~as “anticipate~~position,” ~~“believe,”~~business ~~“would~~strategy,” ~~“expect~~targets,” ~~“intend,”~~projected ~~“may~~sales,” ~~“planned~~costs,” ~~“potential~~income,” ~~“should~~capital expenditures,” ~~“will”~~debt levels and ~~“could~~cash flows,” orand ~~the~~plans ~~negative~~and objectives of ~~these~~management ~~terms~~for orfuture ~~words~~operations. ofThe ~~similar~~use ~~meaning. These~~of ~~statements~~words ~~include~~such ~~expected~~as ~~future~~"may," ~~financial~~"will," ~~results~~"expect," ~~product offerings~~"intend," ~~global expansion~~"estimate," ~~liquidity needs~~"anticipate," ~~financing ability~~"believe," ~~planned capital expenditures~~"should," ~~management’s~~"project" or ~~the~~"plan" ~~Company’s~~or ~~expectations~~similar ~~and~~terminology ~~beliefs,~~are ~~and~~generally ~~similar~~intended ~~matters~~to ~~discussed,~~identify orforward-looking ~~otherwise~~statements. ~~incorporated~~These ~~herein~~forward-looking statements by ~~reference,~~their innature ~~this~~address ~~Form~~matters ~~10-K. The~~that ~~discussions~~are, ofto ~~such~~different ~~matters~~degrees, uncertain and are subject ~~areas~~to ~~are~~risks, ~~qualified~~assumptions, byand ~~the~~other ~~inherent~~factors, ~~risks~~some ~~and~~of ~~uncertainties~~which ~~surrounding~~are ~~future~~beyond ~~expectations~~the ~~generally~~Company's control, ~~and~~that ~~also~~could ~~may~~cause ~~materially~~actual results to differ materially from ~~the~~those ~~Company’s~~expressed ~~actual~~or ~~future~~implied ~~experience~~by such forward-looking statements.

The Company’s ~~business,~~ operations and financial performance are subject to certain risks and uncertainties, ~~which~~including: could result in material differences in actual results from the Company’s current expectations. These risks and uncertainties include, but are not limited to, general economic conditions, in particular relating to the automotive industry, consumer demand for the Company’s and its customers’ products, competitive and technological developments, customer purchasing actions, changes in warranty provisions and customers' product recall policies, work stoppages at the Company or at the location of its key customers as a result of labor disputes, foreign currency fluctuations, uncertainties stemming from U.S. trade policies, tariffs and reactions to same from foreign countries, delays and restrictions impacting the import of goods and components stemming from heightened security procedures implemented by the U.S. government related to U.S.-Mexico border crossings, the volume and scope of product returns or customer cost reimbursement actions, changes in the costs of operations, warranty claims, adverse business and operational issues resulting from any material global supply chain and logistics disruption, the ongoing and lingering effects of the semiconductor chip supply shortages, matters adversely impacting the timing, availability and cost of material component parts and raw materials for the production of our products and the products of our customers, or the continuation or worsening thereof, matters related to the pricing actions implemented by the Company and customer responses and concessions related to the same, and other matters described under “Risk Factors” in Part I, Item 1A of this report.

•

~~Shareholders,~~an ~~potential~~uncertain ~~investors~~economic environment and ~~other~~inflationary ~~readers~~conditions ~~are~~coupled ~~urged~~with ~~to consider these factors carefully in evaluating~~ the ~~forward-looking~~cyclical ~~statements~~nature ~~and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as~~ of the ~~date~~automotive ofindustry ~~this~~may ~~Form~~adversely ~~10-K~~affect ~~and~~global ~~the~~vehicle ~~Company~~production ~~undertakes~~and nodemand ~~obligation~~for toour ~~publicly~~products; ~~update such forward-looking statements to reflect subsequent events or circumstances occurring after the date of this Form 10-K.~~

•

we operate in a highly competitive market and technological developments within our sphere of offerings are rapidly evolving;

•

changes in customer purchasing actions, warranty provisions and product recall policies could adversely affect our business, results of operations and financial condition;

•

work stoppages within our operations or at the location of our key customers as a result of labor disputes could adversely impact our business, results of operations and financial condition;

•

labor cost inflation or unionization efforts in Mexico, coupled with a shortage of skilled laborers in the United States, could increase our manufacturing expenses and impact production efficiency;

•

changes in tariffs or international trade policies could adversely affect our results, particularly with respect to goods imported into the United States or produced under U.S. trade agreements such as the USMCA;

•

delays and restrictions impacting the import of goods and components stemming from heightened security procedures or changes in policies implemented by the U.S. Government related to U.S.-Mexico border crossings could have a negative effect on our business;

•

an increase in the volume and scope of product returns or customer cost reimbursement actions could adversely impact our business, results of operations and financial condition;

•

our ability to manage changes in the costs of operations, warranty claims, adverse business and operational issues could be affected by a material global supply chain and logistics disruption;

•

future shortages in the supply of semiconductor chips and other matters adversely impacting the timing, availability and costs of material component parts and raw materials for the production of our products could adversely affect our business, results of operations and financial condition;

•

macroeconomic and geopolitical conditions, including regional conflicts, could adversely affect our business, results of operations and financial condition;

•

interruptions to our information security management systems and cybersecurity incidents could adversely affect our business, results of operations and financial condition; and

•

other matters including, but not limited to, the factors listed in the “Risk Factors” in Part I, Item 1A of this Annual Report on Form 10-K.

Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as of the date of this Form 10-K and the Company undertakes no obligation to update such forward-looking statements.

PART I

ITEM 1. BUSINESS

~~Basic Business~~Overview

~~STRATTEC~~Strattec, ~~SECURITY~~which ~~CORPORATION~~has ~~designs,~~a ~~develops,~~history ~~manufactures~~serving ~~and~~the ~~markets~~ automotive ~~security,~~industry ~~access~~for ~~control,~~over ~~and~~100 ~~user interface controls products and solutions. This includes mechanical locks and keys~~years, ~~electronically~~was ~~enhanced~~incorporated ~~locks~~as ~~and~~a ~~keys,~~stand-alone ~~passive~~company ~~entry~~in ~~passive~~1995. Our ~~start systems (PEPS)~~Milwaukee, ~~phone~~Wisconsin asheadquarters aoversees ~~key~~operations ~~systems~~in ~~(Paak),~~the ~~steering~~United ~~column~~States and ~~instrument~~Mexico ~~panel~~for ~~ignition~~a ~~lock~~global ~~housings,~~customer ~~latches,~~base. ~~power~~Since ~~sliding~~the ~~side~~Company’s ~~door systems~~inception, ~~power~~we ~~tailgate~~have ~~systems,~~partnered ~~power~~with ~~lift~~our ~~gate~~customers ~~systems,~~to ~~power~~design ~~deck lid systems, door handles, steering wheel switches~~ and ~~controller,~~manufacture ~~E-shifters,~~highly ~~paddle~~engineered ~~switches~~products and ~~related~~solutions ~~products~~creating ~~for primarily North American automotive customers. We also previously supplied global automotive manufacturers through~~ a ~~strategic~~broad ~~relationship~~range ~~with WITTE Automotive (“WITTE”)~~ of ~~Velbert,~~innovative ~~Germany~~automotive ~~and~~access ~~ADAC Plastics Inc~~products. While ~~(doing~~primarily ~~business~~focused ason ~~ADAC~~key ~~Automotive~~North ~~(“ADAC”),~~American ofautomotive ~~Grand~~original ~~Rapids,~~equipment ~~Michigan)~~manufacturers ~~called Vehicle Access Systems Technology LLC~~ (~~"VAST LLC"), doing business as the VAST Automotive Group (~~“~~VAST~~OEM”)~~. Under this unique strategic relationship~~, ~~STRATTEC,~~we ~~WITTE~~also ~~and~~provide ~~ADAC~~our ~~marketed the~~ products ofglobally ~~each company~~ to ~~global~~ customers ~~under~~in ~~the~~both ~~“VAST~~OEM ~~Automotive~~and ~~Group”~~aftermarket ~~brand name~~channels. We ~~Effective~~believe asthat ofour ~~June~~engineering 30expertise, ~~2023,~~ability ~~STRATTEC sold its one-third interest in VAST LLC~~ to ~~WITTE.~~deliver Ascustomized ofsolutions ~~the~~and ~~closing~~our ofquality ~~the~~and ~~sale~~delivery ofperformance ~~its~~are ~~VAST~~key ~~LLC~~advantages ~~interest, STRATTEC entered into a strategic preferred partner relationship with WITTE covering VAST LLC pursuant to the terms of a cooperation framework agreement~~ that ~~enables~~differentiate ~~STRATTEC to continue to market and rely on~~ the ~~global~~Company ~~capabilities~~from ofits ~~VAST~~competitors ~~LLC. See "VAST, LLC, SPA, LLC~~ and ~~SPA~~allow deus ~~Mexico Equity Restructuring Agreement" below for additional information regarding the sale of STRATTEC's VAST LLC interest~~ to ~~WITTE.~~be ~~STRATTEC~~a ~~products~~premier ~~are~~partner ~~shipped~~ to ~~customer locations in the United States, Canada, Mexico, Europe, South America, Korea, and China, and we, along with~~ our ~~partners, provide full service and aftermarket support for each VAST Automotive Group partners’ products~~customers.

History

The product line that became STRATTEC was part of Briggs & Stratton Corporation’s founding business in 1908. In 1995, STRATTEC was spun off from Briggs & Stratton through a tax-free distribution to the then-existing Briggs & Stratton shareholders and has been an independent public company for over twenty-nine years.

Our history in the automotive security business spans 116 years. STRATTEC has been the world’s largest producer of automotive locks and keys since the late 1920s, and we currently maintain a significant share of the North American markets for these products.

Products

~~Our~~As ~~traditional~~automotive vehicle security ~~products are lock sets (locks~~ and ~~keys)~~safety ~~for~~demands ~~cars~~continue ~~and~~to ~~light trucks. Typically~~strengthen, ~~two~~our ~~keys~~product ~~are~~portfolio ~~provided~~is ~~with~~well ~~each~~positioned ~~vehicle~~to ~~lockset. Most~~meet ofour ~~the~~customers’ ~~vehicles~~evolving ~~we currently supply are using keys with sophisticated radio frequency identification technology for additional theft prevention~~needs. ~~Keys~~Our ~~with~~product ~~remote~~offerings ~~entry~~primarily ~~devices~~relate ~~integrated~~to ~~into~~security ~~a single unit~~ and ~~bladeless~~authorization ~~electronic~~solutions, ~~keys~~ as well as ~~turn-key~~vehicle ~~PEPS~~access systems ~~have been added to our product line and are gaining in popularity~~. ~~Paak systems are also gaining in popularity and we will be supplying products for these systems.~~

~~Ignition~~Security ~~lock~~and ~~housings~~authorization ~~represent~~products ~~another~~include ~~security~~mechanical ~~product~~and ~~for~~electronically ~~us.~~enhanced ~~These~~locks ~~housings~~and ~~are~~keys, ~~the~~fobs, ~~mating~~passive ~~part~~entry ~~for~~passive ~~our~~start systems, digital key, steering column and instrument panel ignition ~~locks~~lock housings and ~~typically~~related ~~are~~solutions. ~~part~~We ofestablished ~~the~~our ~~steering~~leading ~~column~~market ~~structure,~~position ~~although~~with ~~there~~North ~~are~~American ~~instrument~~automotive ~~panel-mounted~~customers ~~versions~~initially ~~for~~with ~~certain~~our ~~vehicle~~legacy ~~applications~~mechanical locks and keys. Our ~~These~~flexible ~~housings~~and ~~are~~responsive ~~either~~service ~~die~~and ~~cast~~our ~~from~~deep ~~zinc~~relationships orwith ~~injection~~our ~~molded~~customers ~~plastic~~have allowed us to deliver these products both directly to our OEM customers and ~~may~~through ~~include~~our ~~electronic~~differentiated ~~components~~service ~~for~~in ~~theft~~the ~~deterrent~~aftermarket ~~systems~~channel.

WeOur ~~have~~vehicle ~~developed~~access ~~and~~product ~~are~~portfolio ~~continuing~~was toderived ~~develop~~from ~~access~~an ~~control~~acquisition ~~products,~~in ~~including~~fiscal ~~trunk~~2009 ~~latches,~~and ~~lift~~includes ~~gate~~power ~~latches,~~sliding ~~tailgate latches~~doors, ~~hood~~power ~~latches,~~tailgates ~~side door latches~~ and ~~related~~lift ~~hardware.~~gate ~~With our acquisition of Delphi Corporation’s Power Products Group in fiscal 2009~~systems, weas ~~have~~well ~~been~~as ~~supplying~~power ~~and~~deck ~~continue~~lid tosystems. The ~~supply~~products ~~various~~included ~~power~~in ~~access~~these highly-engineered systems ~~for~~include ~~sliding~~drivetrain ~~side doors~~mechanisms, ~~tailgates,~~complex ~~lift~~latching ~~gates~~mechanisms and ~~trunk~~electronic ~~lids~~control ~~to our automotive industry customers~~units. ~~Through~~These asystem ~~joint~~offerings ~~venture~~work ~~formed~~together ~~with~~to ~~ADAC~~provide ~~Automotive~~our ~~during~~customers ~~fiscal~~optimal ~~2007,~~performance wethrough ~~also~~a ~~supply~~deep ~~painted~~understanding ~~and~~of ~~non-painted~~mechanical, ~~door~~electrical ~~handles~~ and ~~components~~software ~~and related vehicle access hardware~~architectures.

~~Recently,~~We wehave ~~also~~leveraged ~~added~~our aknow-how ~~new~~between ~~product~~our ~~category~~lock inand ~~User~~key ~~Interface~~products ~~Controls~~and byour ~~developing~~vehicle ~~and~~access ~~putting~~solutions into ~~production~~also develop user-interface control products, ~~such~~which asinclude steering wheel switches, ~~and its controller~~controllers, Ee-shifters and paddle switches.

InWe ~~recent~~also ~~years,~~provide ~~more~~door ~~and~~handles ~~more~~through ~~vehicle~~our ~~access~~joint ~~systems~~venture. These ~~have~~products ~~moved~~leverage ~~from~~our ~~purely~~deep ~~mechanical~~manufacturing ~~components~~knowledge toand ~~integrated~~understanding ~~electro-mechanical~~of ~~systems.~~automotive ~~STRATTEC~~requirements ~~has~~to ~~been~~deliver athigh ~~the~~quality ~~forefront of this new technology~~components, ~~working~~bringing ~~with~~together ~~Original~~world-class ~~Equipment~~injection ~~Manufacturers’~~mold ~~(OEMs) product development~~ and ~~purchasing~~assembly ~~groups~~capability towith ~~provide~~high ~~cost-effective,~~quality ~~innovative~~paint ~~solutions to the challenges facing our customers~~processes.

All of our products are safety critical, powertrain agnostic and are applicable for internal combustion, plug-in/hybrid or electric vehicles. Applications we serve require robust engineering partnership during the vehicle design cycle, which is typically three to five years ahead of start of production. Our engineering team works closely with our customers during the design phase to ensure our products meet specific vehicle platform requirements. Once our products are designed into an application, we are well positioned as the incumbent supplier for the life of the vehicle due to the high degree of customization and vehicle platform certification. We believe this is one of the reasons our products are rarely changed during a platform lifecycle which, in the case of the North American automotive industry, typically lasts five to seven years.

Across our product lines, we have built strong platform and system competencies, including software development. This approach enables us to leverage our software and component technical capabilities to move with speed and agility and provide better package flexibility for easier integration into a variety of platforms for our customers. For example, we have elevated our key fob business with our digital key product which leverages our system and software capability to meet increasing security, software and packaging architecture needs. Our power access solutions products are designed from a core platform approach that allows us to leverage carry-over components within a system to move faster through the design phase and provide optimal package flexibility while meeting increasing vehicle safety and security needs.

We believe we are at the forefront of emerging technology, collaborating with OEM product development and purchasing groups to provide cost-effective innovative solutions to the challenges facing our customers.

STRATTEC’s customer-focused structure and formalized product development process helps us identify and meet customer needs in order to support the customer's program milestones. From concept and design, through implementation and into the aftermarket, STRATTEC delivers products that provide the optimum value solution to security, access control and user interface controls requirements. We have a comprehensive Products & Solutions portfolio that can be viewed on our website at www.strattec.com (see “Available Information” below for additional information).Customers

ToWe ~~maintain~~are a ~~strong~~direct ~~focus~~supplier onto ~~each~~automotive ~~of these security, access control~~ and ~~user~~light ~~interface~~truck ~~controls products~~OEMs, weas ~~have~~well ~~Product~~as ~~Business~~other ~~Managers~~transportation ~~who~~industry ~~oversee~~OEMs. ~~the~~Our product’s ~~entire~~mix ~~life~~varies ~~cycle,~~by ~~including product concept~~customer, ~~application, manufacturing, warranty analysis, service/aftermarket, and financial/commercial issues. The Product Business Managers work closely~~ with ~~our~~most ~~sales~~customers ~~organization,~~sourcing ~~our~~multiple ~~engineering~~product ~~group,~~categories ~~and~~from ~~our manufacturing operations to ensure their products are receiving the right amount of quality attention so that their value to STRATTEC and the marketplace is enhanced~~us.

~~Markets~~Direct sales to various OEMs (including Tier 1 suppliers) represented approximately 90% of our total sales for both fiscal 2025 and 2024. The remainder of our sales are to the OEM service channels, the aftermarket and sales of certain products to non-automotive customers.

WeA ~~are~~significant aportion ~~direct~~of ~~supplier~~our toannual ~~OEM~~sales ~~automotive and light truck manufacturers as well as other transportation-related manufacturers. Our largest customers~~ are to General Motors Company, Ford Motor Company, and Stellantis. ~~Our~~The ~~product~~products ~~mix~~sold ~~varies by customer, but generally our overall sales tend~~ to bethese ~~highest~~customers inare ~~door~~model ~~handles and trim components produced by ADAC-STRATTEC de Mexico~~specific, ~~followed~~fitting byonly ~~lock~~certain ~~and~~defined ~~key,~~applications. ~~including~~As ~~aftermarket produced by STRATTEC de Mexico~~such, ~~power~~we ~~access~~are ~~products~~highly ~~produced~~dependent byon ~~STRATTEC~~these ~~Power~~customers' ~~Access~~ability deto ~~Mexico,~~produce and ~~latch~~sell ~~mechanisms~~vehicles ~~and~~which ~~ignition~~utilize ~~lock~~our ~~housing components produced by STRATTEC de Mexico~~products. ~~See Operations discussion included herein for further description.~~

~~Direct~~Sales ~~sales~~ to ~~various~~our ~~OEMs~~customers ~~represented~~are ~~approximately~~coordinated 81through ~~percent~~direct ~~and~~sales 80personnel ~~percent~~and ofsupported by our ~~total~~program ~~sales~~managers, ~~for~~application ~~fiscal~~engineers ~~2024~~ and ~~2023,~~other ~~respectively~~product engineering personnel. ~~The~~ ~~remainder~~In ofaddition, ~~our~~we ~~revenue~~distribute isour ~~primarily~~components ~~through~~and ~~sales~~security products to the ~~OEM~~automotive ~~service~~aftermarket ~~channels~~through authorized wholesale distributors, as well as other marketers and users of component parts. Our sales are generally based upon purchase orders issued by the ~~aftermarket~~OEMs and ~~Tier~~updated 1for ~~automotive~~volume ~~supplier~~adjustments ~~customers~~through production releases. As such, we do not have a firm and ~~sales~~definitive backlog of ~~certain~~orders. Once awarded to supply products for a particular platform, we typically support those products for the life of the vehicle, which is normally five to ~~non-automotive~~seven ~~commercial~~years, ~~customers~~though this term is not guaranteed. When we are the incumbent supplier for a given platform, we believe we have a competitive advantage in winning the replacement platform, although, future awards are not guaranteed.

Sales to our major automotive customers, both OEM and Tier 1, are coordinated through direct sales personnel located in our Detroit-area office. Sales are also facilitated through daily interaction between our Program Managers, Application Engineers and other product engineering personnel. Sales to other OEM customers are accomplished through a combination of our sales personnel located in Detroit and personnel in our Milwaukee headquarters office.

The majority of our OEM products are sold in North America. While some exporting is done to Tier 1 and directly to automotive assembly plants in Europe, Asia and South America, we have restructured our presence in these markets and elsewhere through our entry into a cooperation framework agreement with WITTE related to the business of VAST LLC as part of our sale of our VAST LLC interest to WITTE under the terms of the Equity Restructuring Agreement. We are also independently evaluating our presence in markets outside of North America through other channels.

OEM service and replacement parts are sold to the OEM’s service operations. In addition, we distribute our components and security products to the automotive aftermarket through authorized wholesale distributors, as well as other marketers and users of component parts, including export customers.

Customer Sales Focus

To bring the proper focus to the relationships with our major customers, we have six customer-focused teams, each with a Director of Sales, Product Business Manager and one or two Engineering Program Managers and various Customer Application Engineers. In addition to customer teams for General Motors, Ford and Stellantis, we currently have teams for New Domestic Vehicle Manufacturers (primarily new EVs, the European, Japanese and Korean automotive manufactures), User Interface Controls customers, Tier 1 customers, and Service and Aftermarket customers. Sales and engineering for ADAC-STRATTEC LLC (described in greater detail below) are supported by our partner in this joint venture, ADAC Automotive.

Each Sales Director is responsible for the overall relationship between STRATTEC and a specific customer group. Product Business Managers and Program Managers are responsible for coordinating cross functional activities while managing new product programs for their customers.

Product Engineering Focus

ToOur ~~best~~product ~~serve~~engineering ~~our~~activities, ~~customers’~~including ~~product~~research ~~needs~~and development, ~~STRATTEC’s~~are ~~engineering~~an ~~resources~~essential ~~are~~part ~~organized~~of ~~into~~our ~~groups~~efforts ~~which~~to ~~focus~~develop onnew ~~specific~~or ~~access~~improved ~~control~~innovative ~~applications~~products. WeOur ~~currently~~product ~~have~~engineering, ~~six~~including ~~engineering~~the ~~groups: Locks~~development ~~and~~of ~~Keys,~~customized ~~Aftermarket,~~customer ~~Latches~~solutions, ~~Power~~is ~~Access~~accomplished ~~Systems,~~in ~~User~~both ~~Interface~~the ~~Controls~~United States and ~~Wireless Systems~~Mexico. The ~~Each~~development ~~group~~of ~~has~~new aproducts, ~~Product~~or ~~Business~~enhancements ~~Manager~~to existing products, anare ~~Engineering~~the ~~Manager~~result of collaboration with customers. Our engineers and program managers follow a ~~complement~~formalized ofproduct ~~skilled~~development ~~engineers~~process ~~who~~to streamline development and identify market requirements. Our advanced design and ~~develop~~engineering ~~products~~capabilities ~~for~~contribute ~~specific~~to ~~applications.~~the Indevelopment ~~doing~~of ~~this~~innovative and highly engineered products, ~~each~~maintain ~~engineering~~our ~~group~~technological ~~works~~leadership ~~closely~~and enhance our ability to provide customers with ~~both~~unique ~~the~~customized ~~customer~~solutions and ~~product~~products. ~~teams,~~We ~~Engineering~~specialize ~~Program~~in ~~Managers~~system, mechanical, electrical and ~~Application~~software ~~Engineers~~engineering and have advanced modeling and testing capabilities that allow us to meet the design and timing requirements from our customers.

3Patents, Tradename and Other Intellectual Property

~~Underlying~~The ~~this~~development ~~organization~~of isnew aor ~~formalized~~improved ~~product~~technologies ~~development~~is ~~process~~critical to ~~identify~~the ~~and~~execution ~~meet~~of ~~customer~~our ~~needs~~business ~~in the shortest possible time~~strategy. ByCurrently-owned ~~following~~patents ~~this~~and ~~streamlined~~patents ~~development~~obtained ~~system,~~for wenew ~~shorten~~or ~~product~~improved ~~lead~~technologies ~~times,~~form ~~tighten~~an ~~our~~important ~~response~~basis tofor ~~market changes and provide our customers with~~ the ~~optimum~~Company's ~~value~~success ~~solution to their security, access control~~ and ~~user~~underpin ~~interface~~the ~~controls~~success ~~requirements.~~of ~~STRATTEC~~our isresearch ~~also IATF 16949:2016~~ and ~~ISO~~development ~~14001 certified~~efforts. ~~This~~We ~~means~~have wea ~~embrace~~policy ~~the~~of ~~philosophy~~seeking ~~that~~patents ~~quality~~on ~~should~~new ~~exist~~products ~~not~~and ~~only~~improvements inwhen ~~the finished product, but in every step of our processes as well~~appropriate.

Intellectual property is of considerable importance to the manufacturing, marketing and sale of our products. However, we do not consider any single patent, trademark or other intellectual property to be material to our business as a whole, except for the Strattec tradename.

Operations

ASubstantially ~~significant~~all ~~number~~ of ~~the components that go into~~ our products are manufactured at ~~our~~the ~~headquarters~~facilities inwe ~~Milwaukee,~~own ~~Wisconsin.~~in ~~This~~the ~~facility~~United ~~produces~~States ~~zinc die cast components, stampings~~ and ~~milled key blades~~Mexico. WeMany ~~have~~of ~~three~~the ~~owned~~components ~~production~~used ~~facilities currently~~ in ~~operation~~our inproducts ~~Juarez,~~are ~~Mexico~~manufactured ~~operating~~in asour ~~STRATTEC~~facility dein ~~Mexico.~~Milwaukee, ~~Plant~~Wisconsin, ~~No.~~which 1specializes ~~houses~~in ~~key~~die ~~finishing and assembly operations for locksets~~casting, ~~PEPS~~stamping and ~~Paak~~plating ~~components,~~operations. We ~~ignition~~also ~~lock~~operate ~~housings,~~in ~~steering~~three ~~wheel~~production ~~switches~~facilities ~~and~~in ~~its controllers~~Juarez, ~~E-shifters and paddle switches~~Mexico. These ~~Plant~~facilities ~~No.~~assemble 2finished ~~houses~~products ~~our key molding~~ and have plastic injection molding ~~operations for door handles and components~~capabilities, as well as ~~containing~~printed ~~dedicated~~circuit ~~space~~board ~~for~~manufacturing ~~the assembly operations of ADAC-STRATTEC de Mexico~~capability. Finally, ~~Plant~~our ~~No. 3 houses both latch and power access assembly~~ operations ~~for~~in ~~STRATTEC~~our ~~Power~~Leon, ~~Access de~~ Mexico. ~~Plant~~facility ~~No.~~include 4plastic isinjection inmolding ~~Leon~~operations, ~~Mexico~~a ~~and houses our~~ custom paint system ~~for door handles~~ and assembly ~~for ADAC-STRATTEC de Mexico and is owned by the ADAC-STRATTEC de Mexico joint venture~~operations.

~~STRATTEC de MEXICO~~3

STRATTEC de Mexico is a wholly owned subsidiary of STRATTEC which owns and operates the three production facilities in Juarez, Mexico described above under "Operations". These facilities house our assembly operations for locksets and ignition lock housings, our key finishing and plastic injection molding operations, our assembly operations for ADAC-STRATTEC de Mexico described below and our latch and power access assembly operations for STRATTEC POWER ACCESS de Mexico described below.

Vehicle Access Systems Technology LLC

In fiscal 2001, we entered into an alliance with WITTE-Velbert GmbH, an automotive supplier based in Germany which designs, develops, manufactures and markets automotive access control products for European-based customers. This alliance consisted of two initiatives: a legal arrangement which allowed STRATTEC to manufacture and market WITTE’s core products in North America and WITTE to manufacture and market STRATTEC’s core products in Europe; and a 50:50 joint venture, WITTE-STRATTEC LLC, to invest in operations with local partners in strategic markets outside of Europe and North America.

In February of 2006, we expanded this alliance and related joint venture with the addition of a third partner, ADAC Plastics, Inc., and renamed the resulting joint venture VAST. ADAC, of Grand Rapids, Michigan, added North American expertise in door handles, a part of WITTE’s core product line that STRATTEC did not have, and an expertise in color-matched painting of these components.

ADAC-STRATTEC LLC and ADAC-STRATTEC de MEXICO

During fiscal 2007, we formed a new entity with ADAC Automotive called ADAC-STRATTEC LLC including a wholly owned Mexican subsidiary ADAC-STRATTEC de Mexico (collectively, ASdM). The purpose of this joint venture is to produce certain ADAC and STRATTEC products utilizing ADAC’s plastic molding injection expertise and STRATTEC’s assembly capability. ASdM currently operates out of defined space in STRATTEC de Mexico Plant No. 2 located in Juarez, Mexico. Products from this joint venture include non-painted door handle components and exterior trim components for OEM customers producing in North America. STRATTEC owns 51% of this joint venture and its financial results are consolidated into STRATTEC’s financial statements. ASdM represented $135.9 million and $121.9 million of our consolidated net sales in our fiscal 2024 and 2023, respectively. STRATTEC de Mexico Plant No. 4 is in Leon, Mexico and houses our custom paint system for door handles and assembly for ADAC-STRATTEC de Mexico.

STRATTEC POWER ACCESS LLC and STRATTEC POWER ACCESS de MEXICO

During fiscal year 2009, we formed a new subsidiary with WITTE Automotive called STRATTEC POWER ACCESS LLC (“SPA”) to acquire the North American business of the Delphi Power Products Group. WITTE was a 20 percent minority owner in SPA until June 30, 2023, at which time WITTE sold its minority interest to STRATTEC. See "VAST, LLC, SPA, LLC and SPA de Mexico Equity Restructuring Agreement" below for additional information regarding STRATTEC's purchase of WITTE's interest in SPA. SPA owns 100 percent of a Mexican subsidiary, STRATTEC POWER ACCESS de Mexico. The purpose of this subsidiary is to produce power access devices for sliding side doors, tailgates, lift gates, trunk lids and other related products. STRATTEC POWER ACCESS de Mexico currently operates out of defined space in STRATTEC de Mexico Plant No. 3 located in Juarez, Mexico.

Financial results for SPA are consolidated in STRATTEC’s financial statements. In our fiscal years ending 2024 and 2023, SPA represented $130.3 million and $114.1 million, respectively, of our consolidated net sales.

VAST LLC, SPA LLC and SPA de MEXICO Equity Restructuring Agreement

On June 30, 2023, STRATTEC completed an Equity Restructuring Agreement with WITTE (“Restructuring Agreement”) related to both the VAST LLC and the SPA joint ventures. Prior to the Restructuring Agreement, STRATTEC was a one-third owner of VAST LLC with WITTE and ADAC Plastics, Inc. Under the terms of the Restructuring Agreement, STRATTEC sold its one-third interest in VAST LLC to WITTE for a net purchase price of $18,500,000 which also included STRATTEC acquiring : (1) WITTE's 20% minority interest in SPA; and (2) the net assets of VAST LLC's Korea branch office, which business is operated by a newly registered Korea branch of the Company. As part of the Restructuring Agreement, ADAC Plastics, Inc. took over 100% of VAST Brazil. As of the closing of the Restructuring Agreement, STRATTEC ceased to be an owner of VAST LLC but obtained 100% ownership of SPA.

While the equity ownership in VAST has changed, we expect to continue to leverage the VAST brand and to collaborate on product development and manufacturing capabilities with WITTE and VAST in winning new business and serving global customers. Accordingly, at closing of the Restructuring Agreement, we entered into a cooperation framework agreement with WITTE covering the business of VAST LLC which provides a framework for the parties to collaborate on global programs related to product development and manufacturing. This will enable STRATTEC to supply and deliver global programs by leveraging the VAST global footprint with the added advantage of providing regional support from WITTE’s operating entities in Europe, China and India. We will also jointly, along with ADAC Plastics and WITTE, continue to leverage the sales/engineering offices in Japan, Korea and Brazil. The Restructuring Agreement and cooperation framework agreement position STRATTEC to redeploy assets, both financial and technical, to create greater focus on STRATTEC-specific strategic growth opportunities in North America and around the world. We believe this allows us to be more focused and competitive in this exciting and once-in-a-lifetime restructuring of a major industry where we are well-positioned to take advantage of new opportunities. This includes more of our product applications on Electric Vehicles, growing consumer demand for Power Access products, expansion of electronics capabilities and other new automotive products. It will also give us greater resources to further explore diversification of markets, complimentary technology and regions outside of North America.

ADAC-STRATTEC LLC and ADAC-STRATTEC de MEXICO were unaffected by the Restructuring Agreement. For further information on VAST LLC and the equity restructuring, see "Investment in Joint Ventures and Majority Owned Subsidiaries" and "Equity (Loss) Earnings of Joint Ventures" included in Notes to Financial Statements under Item 8 in this Form 10-K.

Seasonal Nature of the Business

~~The~~Our ~~manufacturing~~principal ofoperations ~~components~~are ~~used~~directly inrelated ~~automobiles~~to isthe ~~driven~~automotive byindustry. ~~the~~Consequently, ~~normal~~we ~~peaks~~have ~~and~~historically ~~valleys~~experienced ~~associated~~seasonal ~~with~~fluctuations to the ~~automotive~~extent ~~industry.~~that ~~Typically,~~automotive ~~the~~vehicle ~~months~~production ofslows, ~~July~~such ~~and~~as ~~August~~in ~~are~~the ~~relatively~~summer ~~slow~~months aswhen ~~summer~~many ~~vacation~~customer ~~shutdowns~~plants ~~and~~close for model year changeovers ~~occur~~and atin ~~the~~December ~~automotive~~when ~~assembly~~many customer plants. ~~September~~close ~~volumes~~for ~~increase~~the ~~rapidly~~holidays. asFluctuation ~~each~~has ~~new~~also ~~model~~occurred, ~~year~~in ~~begins.~~recent ~~This~~years ~~volume~~when ~~strength~~global ~~typically~~light ~~continues~~vehicle ~~through~~production, ~~October~~inventory and ~~into~~consumer ~~early~~demand ~~November.~~all Asexperienced ~~the~~extreme ~~holiday~~dislocations ~~and~~from ~~winter~~historic ~~seasons~~norms ~~approach,~~due to the ~~demand~~global ~~for~~COVID-19 ~~automobiles slows, as does production~~pandemic. ~~March~~Post-pandemic, ~~usually~~global ~~brings~~light avehicle ~~major sales and~~ production ~~increase,~~has ~~which~~continued ~~then~~to ~~continues~~be ~~through~~negatively ~~most~~impacted ofby ~~June.~~widespread ~~This~~supply ~~results~~chain indisruptions, ~~our~~limiting ~~first~~new ~~fiscal~~vehicle ~~quarter~~manufacturing. Seasonality ~~sales~~of ~~and~~production ~~operating~~has ~~results~~normalized ~~typically~~since ~~being~~2023, ~~our~~however ~~weakest,~~total ~~with~~production ~~the~~volume ~~remaining~~has ~~quarters~~remained ~~being~~below ~~more~~pre-pandemic ~~consistent~~levels.

Served Customer Vehicles

Our product solutions can be found on over 90 different customer vehicles, including electric (EV), plug-in/hybrid, and internal combustion engine platforms. Key vehicle platforms include, but are not limited to, the following:


Acura MDX	Chevrolet Express Van	Hyundai Staria
Acura RDX	Chevrolet S-10	Jeep Commander
Acura ZDX	Chevrolet Silverado & Silverado HD	Jeep Compass
Aston Martin AMR24	Chevrolet Spin	Jeep Gladiator
Aston Martin DB 12	Chevrolet Suburban	Jeep Grand Cherokee
Aston Martin DBS	Chevrolet Tahoe	Jeep Meridian
Aston Martin DBX	Chevrolet Trail Blazer	Jeep Recon
Aston Martin Valhalla	Chevrolet Traverse	Jeep Wagoneer
Aston Martin Valkyrie	Chevrolet Trax	Jeep Wrangler/Wrangler Unlimited
Aston Martin Valour	Chrysler Pacifica	Kia Carnival
Aston Martin Vantage	Dodge Charger	Lincoln Aviator
Audi Q5	Dodge Durango	Lincoln Corsair
BMW X7	Dodge Hornet	Lincoln Navigator
Brightdrop EV400	Ford Bronco Sport	Ram 1500 Classic Pickup
Brightdrop EV600	Ford Escape	Ram 1500 Pickup
Buick Enclave	Ford Expedition	Ram HD Pickup
Buick Envista	Ford Explorer	Ram REV Pickup
Cadillac ATS	Ford F-150 Lightning	Volkswagen Jetta
Cadillac Celestiq	Ford Focus	Volkswagen Tiguan
Cadillac CT4	Ford F-Series Pickup	Volvo EX90
Cadillac CT5	Ford F-Series Super Duty Pickup	Volvo Heavy Truck
Cadillac Escalade	Ford Maverick Pickup	Volvo Polestar 3
Cadillac Escalade IQ	Ford Mustang
Cadillac Lyriq	Ford Mustang Mach-E
Cadillac Optiq	Ford Ranger Pickup
Cadillac Vistiq	GMC Acadia
Cadillac XT4	GMC Canyon
Cadillac XT5	GMC Hummer
Cadillac XT6	GMC Savana
Chevrolet Blazer	GMC Sierra & Sierra HD
Chevrolet Bolt	GMC Sierra Pickup
Chevrolet Cobalt	GMC Terrain
Chevrolet Colorado	GMC Yukon and Yukon XL
Chevrolet Corvette	Honda Odyssey
Chevrolet Corvette E-Ray	Honda Passport
Chevrolet Equinox	Honda Prologue

~~Vehicle~~Raw ~~List~~Material Costs and Availability

~~2025~~We ~~Vehicles~~source materials and components from a network of global suppliers. Our primary raw materials are high-grade zinc, brass, nickel silver, steel, aluminum, plastic resins, semiconductor chips and other electronics. These materials are generally available from a number of suppliers and are subject to price fluctuations. We believe our sources for raw materials are reliable and adequate for our needs. In the normal course of business, we do not carry substantial inventories of these raw materials in excess of levels reasonably required to meet our near-term production requirements.

~~We are proud to be associated with many of the quality vehicles produced in North America and elsewhere.~~Competition

~~The~~We ~~following~~compete ~~cars~~with domestic and ~~light~~foreign ~~trucks~~competitors ~~are~~based ~~equipped~~on ~~with~~product ~~STRATTEC~~design, ~~components~~engineering ~~during~~support, quality, delivery and price. While the number of direct competitors in our ~~2025~~product ~~fiscal~~markets ~~year:~~is currently relatively small, automotive OEMs actively encourage competition between potential suppliers. We compete for business principally based on of quality, technical support, program management, innovation and aftermarket support.

PASSENGER CARS
Acura ZDX (EV)	Aston Martin Vantage *	Chevrolet Malibu
Aston Martin AMR24 *	Cadillac ATS *	Dodge Charger (EV)
Aston Martin DB 12 *	Cadillac CT4	Ford Focus
Aston Martin DBS *	Cadillac CT5 *	Ford Focus (Mild Hybrid EV)
Aston Martin DBX *	Cadillac Celestiq (EV)	Ford Mustang
Aston Martin Valhalla *	Chevrolet Corvette	Volkswagen Jetta
Aston Martin Valkyrie *	Chevrolet Corvette E-Ray (Hybrid EV)
Aston Martin Valour *	Chevrolet Joy *
LIGHT TRUCKS, VANS AND SPORT UTILITY VEHICLES
Acura MDX	Chevrolet Spin *	GMC Yukon and Yukon XL
Acura RDX	Chevrolet Suburban	Honda Odyssey
Audi Q5	Chevrolet Tahoe	Honda Passport
Brightdrop EV400 (EV)	Chevrolet Trail Blazer *	Honda Prologue (EV)
Brightdrop EV600 (EV)	Chevrolet Traverse	Hyundai Staria *
Buick Enclave	Chevrolet Trax *	Jeep Commander *
Buick Envista *	Chrysler Pacifica (PH option)	Jeep Compass
BMW X7	Dodge Durango	Jeep Gladiator
Cadillac Escalade	Dodge Hornet (PH option)	Jeep Grand Cherokee
Cadillac Escalade IQ (EV)	Ford Bronco Sport	Jeep Meridian
Cadillac Lyriq (EV)	Ford Escape (PH option)	Jeep Recon (EV)
Cadillac Optiq (EV)	Ford Expedition (PH option)	Jeep Wagoneer
Cadillac Vistiq (EV)	Ford Explorer (PH option)	Jeep Wrangler/Wrangler
Cadillac XT4	Ford F-150 Lightning (EV)	Unlimited (PH option)
Cadillac XT5	Ford F-Series Pickup (PH option)	Kia Carnival *
Cadillac XT6	Ford F-Series Super Duty Pickup	Lincoln Aviator (PH option)
Chevrolet Blazer	Ford Maverick Pickup (PH option)	Lincoln Corsair (PH option)
Chevrolet Blazer (EV)	Ford Mustang Mach-E (EV)	Lincoln Navigator (PH option)
Chevrolet Cobalt *	Ford Ranger Pickup * (PH option)	Ram 1500 Classic Pickup
Chevrolet Colorado *	Ford Transit Connect * (PH option)	Ram 1500 Pickup
Chevrolet Equinox	GMC Acadia	Ram HD Pickup
Chevrolet Equinox (EV)	GMC Canyon *	Ram REV Pickup (EV)
Chevrolet Express Van	GMC Hummer (EV)	Tesla Everest (EV)
Chevrolet S-10 *	GMC Savana	Volkswagen Tiguan (PH option)
Chevrolet Seeker *	GMC Sierra & Sierra HD	Volvo Polestar 3 (EV)
Chevrolet Silverado &	GMC Sierra Pickup (EV)	Volvo EX90 (EV)
Silverado HD Pickup	GMC Terrain	Volvo Heavy Truck
Chevrolet Silverado (EV)

Our competitors include Aisin, Alpha-Tech, Brose, Continental, Edscha, Gecom, Honda Lock, Huf North America, Inteva, JNS Auto Parts, Kiekert, Magna, Marquardt, MinbeaMitsumi, Mitsuba, Novares, Ohi, PHA Automotive, Shin Chang, Stabilus, Tokai-Rika, Ushin, and Valeo.

*Human ~~Vehicles~~Capital ~~produced outside of North America, or both in and outside North America.~~Management

EVOur –employees, ~~Electric~~coupled ~~Vehicle~~with our ability to attract, retain and develop talent, are critical to our business strategy and success. Our human capital strategy is focused on developing a creative and open working environment and developing the right skill sets to advance our culture and unlock innovation and growth. We also strive to develop talent for critical roles and leadership positions, reward and support associates through competitive compensation and benefits, and promote the health and safety of our employees. At June 29, 2025, we had 2,848 associates including 417 in the United States, 2,425 in Mexico and 6 in other countries. We have two facilities with union representation, which covers 9.4% of our employees, including our Milwaukee, Wisconsin location (contract expires November 1, 2025) and Leon, Mexico location (contract expires April 8, 2026). In recent years, we have not experienced any significant work slowdowns, stoppages or other labor disruptions.

PHExecutive –Officers ~~Plug-In~~of ~~Hybrid~~Registrant

Our executive officers as of June 29, 2025, together with their ages, positions, and business experience are below:


Name	Age	Current Position
Jennifer Slater	51	President and Chief Executive Officer
Matthew Pauli	47	Senior Vice President, Chief Financial Officer
Rolando Guillot	57	Senior Vice President, Chief Operating Officer
Richard Messina	58	Senior Vice President, Chief Technology Officer
Chey Varto	55	Senior Vice President, Chief Commercial Officer

Jennifer Slater has served as our President and Chief Executive Officer, and as a Director, since July 2024. Prior to joining Strattec, Ms. Slater was Executive Vice President and General Manager, Performance Sensing, of Sensata Technologies, Inc. (NYSE: ST), a global industrial technology company, from April 2024 through June 2024. She also held the position of Senior Vice President, Automotive & Aftermarket, at Sensata from April 2023 to April 2024; and Vice President and General Manager of Sensata's Heavy Duty and Off-Road business from September 2022 through March 2023. Prior to her time with Sensata, Ms Slater held the position of Group Vice President and General Manager, Global OE and Products, at Clarios, LLC from 2019 to September 2022. Ms. Slater serves as a director of Valvoline Inc. (NYSE: VVV), a retail automotive services company; she was first elected in July 2022.

Matthew Pauli has served as our Senior Vice President, Chief Financial Officer since November 2024. With over 25 years of financial expertise, he previously served as Chief Financial Officer of CentroMotion, a global manufacturer of highly engineered products serving

~~Emerging~~the ~~Technologies~~ transportation and other industrial markets. Earlier in his career, Mr. Pauli held senior finance roles at Enerpac (NYSE: EPAC), including Corporate Controller/Chief Accounting Officer, and VP of Finance after starting his career at Ernst & Young.

~~Automotive~~Rolando ~~vehicle~~Guillot ~~security~~has ~~and~~served ~~access~~as ~~systems,~~our ~~which~~Chief ~~are~~Operating ~~both~~Officer ~~theft~~since ~~deterrent~~March ~~and consumer friendly, are trending toward electro-mechanical, software and connected devices~~2023. ~~Electronic~~ ~~companies~~Prior ~~are~~to ~~developing~~that ~~user~~he ~~identification~~was ~~systems~~Senior ~~such~~Vice asPresident ~~bio~~-~~systems,~~ ~~card~~Operations ~~holder~~since ~~(transmitter) systems, etc~~2016., ~~while mechanical locks, keys, housings, and latches are evolving to accommodate electronics~~Mr. WeGuillot ~~believe~~joined weStrattec ~~are positioning ourselves as a vehicle security, access control and user interface controls supplier by building our product, engineering and manufacturing expertise~~ in ~~the~~September ~~required~~1996 ~~electro-mechanical products, which include access systems, latches, keys with remote entry electronic systems, ignition interface systems with passive start~~ and ~~Paak~~will ~~capabilities~~be ~~and~~retiring various user interface controls technologies. In both 2018 and 2019, we were awarded the Automotive News Pace Award for Excellence and Innovation for our Invis-A-RiseTM Power Liftgate and Invis-A-RiseTM Power Tailgate products. Those technologies continue to enable STRATTEC to provide differentiation in ~~the~~September ~~marketplace~~2025. As the automotive industry continues developing various levels of autonomous vehicles, we believe that we are well positioned to continue the development and incorporation of power sliding doors, power tailgates and other consumer convenience features into these types of vehicles.

~~These~~Richard ~~technologies~~Messina ~~benefit~~has usserved byas ~~increasing~~ our ~~potential~~Senior ~~customer~~Vice ~~base~~President as- aGlobal ~~Tier~~Engineering 2since ~~supplier~~January ~~while~~2020 ~~maintaining~~and Chief Technology Officer since May 2023. Prior to that, Mr. Messina served as our ~~Tier~~Vice 1President ~~status~~- onGlobal ~~some~~Sales ~~product~~and ~~lines~~Access Control Products from 2013 until 2023. Mr. Messina began his career with Strattec in August 2008 and byhas ~~adding~~held ~~additional~~various management positions overseeing engineering and product ~~line~~development. ~~availability~~Prior to joining Strattec, Mr. Messina was a Chief Engineer for Delphi Corporation.

~~Sources~~Chey ~~and~~Varto ~~Availability~~has served as our Senior Vice President, Chief Commercial Officer since November 2024. She previously served as Chief Commercial Officer at Vayan Group, a leading provider of ~~Raw~~quality ~~Materials~~assurance solutions for automotive OEMs. Prior to that, she held leadership roles at Clarios, JD Norman Industries, and GST AutoLeather. She began her career at Lear Corporation where she advanced through roles of increasing responsibility.

~~Our~~Available ~~primary~~Information raw materials are high-grade zinc, brass, nickel silver, steel, aluminum, plastic resins and semiconductor chips and other electronics. These materials are generally available from a number of suppliers, but we have chosen to concentrate our sourcing with one primary vendor for each commodity. We believe our sources for raw materials are very reliable and adequate for our needs. We have not experienced any significant long term supply problems in our operations and do not anticipate any significant supply problems into the foreseeable future. See further discussion under “Risk Factors-Sources of and Fluctuations in Market Prices of Raw Materials” included under Item 1A of this Form 10-K.

~~Patents~~We maintain our corporate website at www.strattec.com and make available, ~~Trademarks~~free of charge, our Code of Business Ethics, and ~~Other~~reports ~~Intellectual~~that ~~Property~~we file with the Securities and Exchange Commission. We are not including all the information contained on or made available through our website as a part of, or incorporating such information by reference into, this Annual Report on Form 10-K.

We believe that the success of our business results not only from the technical competence, creativity and marketing abilities of our employees but also from the protection of our intellectual property through patents, trademarks and copyrights. As part of our ongoing research, development and manufacturing activities, we have a policy of seeking patents on new products, processes and improvements when appropriate.

Although, in the aggregate, the intellectual property discussed herein is of considerable importance to the manufacturing and marketing of many of our security, access control and user interface controls products, we do not consider any single patent or trademark or group of related patents or trademarks to be material to our business as a whole, except for the STRATTEC and STRATTEC with logo trademarks.

We also rely upon trade secret protection for our confidential and proprietary information. We maintain confidentiality agreements with our customers and key executives. In addition, we enter into confidentiality agreements with selected suppliers, consultants and employees as appropriate to evaluate new products or business relationships pertinent to our success. However, there can be no assurance that others will not independently obtain similar information and techniques or otherwise gain access to our trade secrets or that we can effectively protect our trade secrets.

Dependence Upon Significant Customers

A significant portion of our annual sales are to General Motors Company, Ford Motor Company, and Stellantis. These three customers accounted for approximately 66 percent of our net sales in both 2024 and in 2023. Further information regarding sales to our largest customers is set forth under the caption “Risk Factors – Loss of Significant Customers, Vehicle Content, Vehicle Models and Market Share” and “Risk Factors – Production Slowdowns by Customers” included under Item 1A of this Form 10-K and “Notes to Financial Statements-Sales and Receivable Concentration” included in Notes to Financial Statements under Item 8 in this Form 10-K.

The products sold to these customers are model specific, fitting only certain defined applications. Consequently, we are highly dependent on our major customers for their business, and on these customers' ability to produce and sell vehicles which utilize our products. We have enjoyed good relationships with General Motors Company, Ford Motor Company, Stellantis and other customers in the past, and expect to continue to do so in the future. However, a significant change in the purchasing practices of, or a significant loss of volume from, one or more of these customers could have a detrimental effect on our financial performance. We cannot provide any assurance that any lost sales volume could be replaced despite our historical relationships with our customers.

~~Sales~~ITEM ~~and~~1A. RISK ~~Marketing; Backlog~~FACTORS

WeInvestors ~~provide~~and ~~our~~readers ~~customers~~should ~~with~~carefully ~~engineered~~consider ~~security,~~each ~~access~~of ~~control~~the ~~and user interface controls products including locksets~~risks, ~~fobs~~assumptions, ~~push~~uncertainties ~~button~~and ~~passive~~other ~~entry~~factors ~~passive~~described ~~start~~below and ~~phone~~elsewhere asin athis ~~key~~Annual ~~ignition systems~~Report, ~~steering~~as ~~column~~well ~~lock~~as ~~housings,~~any ~~electromechanical~~amendments ~~latches,~~or ~~power~~updates ~~sliding~~reflected ~~door~~in ~~systems,~~subsequent ~~power~~filings ~~tailgate~~with ~~systems,~~the ~~power~~Securities ~~liftgate systems, power decklids, painted~~ and ~~non-painted~~Exchange ~~door~~Commission. ~~handles,~~We ~~door~~believe ~~handle~~these ~~components and trim~~risks, ~~steering wheel switches and controllers~~assumptions, ~~E-shifters,~~uncertainties ~~paddle switches~~ and other ~~products~~factors, ~~which~~individually ~~are~~or ~~unique~~in ~~to specific vehicles. Any given vehicle typically takes 1 to 3 years of development and engineering design time prior to being offered to~~ the ~~public. Our products are designed concurrently with the vehicle. Therefore~~aggregate, ~~commitment~~could tocause ~~STRATTEC~~our asactual ~~the~~results ~~production source for such products and components occurs 1~~ to 3differ ~~years~~materially ~~prior~~from toexpected ~~the start of production for such components. We employ a commercial~~ and ~~engineering~~historical ~~staff~~results ~~that assists in providing design~~ and ~~technical~~could ~~solutions~~materially ~~to our customers. We believe that our customer focus~~ and ~~engineering~~adversely ~~expertise~~affect ~~are competitive advantages that contribute to~~ our ~~strong~~business ~~market position in our industry. For example~~operations, weresults ~~regularly~~of ~~provide innovative design proposals for our product offerings to our customers that we believe will improve customer access~~operations, ~~vehicle~~financial ~~security~~condition ~~system quality, theft deterrence~~ and ~~system cost~~liquidity.

~~The~~Business typical process used by automotive manufacturers in selecting a supplier for our products is to offer the business opportunity to us and several of our competitors. Each competitor will pursue the opportunity, doing its best to provide the customer with the most attractive proposal. Price pressure is strong during this process but once an agreement is reached, a commitment is made for each year of the product program. Typically, price reductions resulting from productivity improvement by STRATTEC over the life of the product program are included in the contract and are estimated in evaluating each of these opportunities. A blanket purchase order, a contract indicating a specified part will be supplied at a specified price during a defined time period, is issued by customers for each model year. Production quantity releases or quantity commitments are made to that purchase order for weekly deliveries to the customer. As a consequence and because we are a "Just-in-Time" supplier to the automotive industry, we do not maintain a backlog of orders in the classic sense for future production and shipment and, accordingly, we are unable to provide a meaningful backlog comparison from year to year. Risks

~~Competition~~ Loss of Significant Customers, Vehicle Content, Vehicle Models and Market Share

WeIn ~~compete~~fiscal ~~with~~2025, ~~domestic~~our ~~and~~three ~~foreign-based~~largest ~~competitors~~customers, onGeneral ~~the~~Motors ~~basis~~Company, ofFord ~~custom~~Motor ~~product~~Company ~~design~~and Stellantis, ~~engineering~~accounted ~~support,~~for ~~quality~~29%, ~~delivery~~23% and ~~price.~~12%, ~~While~~respectively, ~~the~~of ~~number~~our ofannual ~~direct~~sales, ~~competitors~~compared to 30%, 21% and 14%, respectively, in ~~our~~fiscal ~~product~~2024. ~~markets~~The iscontracts ~~currently~~with ~~relatively~~these ~~small,~~customers provide for meeting the ~~automotive~~customer’s ~~manufacturers~~requirements ~~actively~~for ~~encourage~~a ~~competition~~particular ~~between~~vehicle ~~potential~~model ~~suppliers~~with our products. WeThe ~~have~~contracts ado ~~large~~not ~~share~~specify a quantity of ~~the~~parts ~~North~~to ~~American~~be ~~market~~supplied ~~for~~over ~~our~~the ~~security~~life of the vehicle, ~~access~~which ~~control~~averages ~~and~~approximately ~~user~~four ~~interface~~to ~~controls~~five ~~products~~years. ~~because~~Components offor ~~our~~certain ~~ability~~customer tomodels ~~provide~~may ~~optimal~~also ~~value,~~be ~~which~~“market istested” aannually. ~~beneficial~~Therefore, ~~combination~~the loss of ~~price,~~any ~~quality,~~one ~~technical~~of ~~support~~these customers, ~~program~~the ~~management,~~early ~~innovation~~cancellation ~~and~~or ~~aftermarket~~breach ~~support.~~by Ineither ~~order~~party toof ~~optimize~~a ~~our~~contract ~~production~~for ~~costs~~a ~~while~~specific ~~still~~vehicle ~~offering~~model, a ~~wide~~reduction ~~range~~in vehicle content, the early cancellation of ~~technical~~a ~~support~~specific vehicle model, wetechnological ~~utilize~~changes ~~assembly~~or ~~operations~~a ~~and~~significant reduction in demand for certain ~~light~~models ~~manufacturing~~could ~~operations~~occur, inand ~~Mexico~~if so, ~~which~~could ~~results~~have ina ~~lower~~material ~~labor~~adverse ~~costs~~effect ason ~~compared~~our toexisting ~~the~~and ~~United~~future ~~States.~~revenue, operating results, financial condition and cash flows.

AsWe ~~locks~~also ~~and~~make ~~keys~~investments ~~become~~in ~~more~~machinery ~~sophisticated~~ and ~~involve~~equipment ~~additional~~used ~~electronics,~~exclusively ~~competitors~~to ~~with~~manufacture products for specific ~~electronic~~customer ~~expertise~~programs. ~~may~~This ~~emerge~~machinery toand ~~challenge~~equipment ~~us.~~is Tocapitalized ~~address~~and ~~this~~depreciated over the expected useful life of each respective asset. Therefore, wethe ~~have~~loss inof ~~recent~~any ~~years~~one ~~strengthened~~of our ~~electrical~~major ~~engineering~~customers, ~~knowledge~~the ~~and~~loss ~~service.~~of Wespecific ~~are~~vehicle ~~also~~models ~~working~~or ~~with~~the ~~several~~early ~~electronics~~cancellation ~~suppliers~~of toa ~~jointly~~vehicle ~~develop~~model ~~and~~could ~~supply~~result ~~these~~in ~~advanced~~impairment ~~products~~in the value of these assets.

~~Our~~Production ~~lockset,~~Slowdowns ~~user~~by interface controls, wireless, latches and power access competitors include Huf North America, Ushin, Valeo, Tokai-Rika, Marquardt, Alpha-Tech, Honda Lock, Shin Chang, Magna, Edscha, Stabilus, Aisin, Brose, Mitsuba, Ohi, Kiekert, Inteva, Novares and Gecom. For additional information related to competition, see the information set forth under “Risk Factors-Highly Competitive Automotive Supply Industry” included under Item 1A of this Form 10-K.Customers

~~Research~~Our business depends on, and ~~Development~~is directly affected by, the global automobile industry. Our major customers and many of their suppliers can be significantly impacted by unfavorable global economic and industry conditions. In the past, many of our major customers have instituted production cuts and shuttered plants in light of these unfavorable conditions which adversely impacts demand for our products during these slowdowns and shutdowns. While production has increased and plants have reopened after these events, any additional economic slowdowns, global conflicts, pandemics or part supply shortages could bring about new production cuts which could have a material adverse effect on our revenue, operating results, financial condition and cash flows. Furthermore, uncertain economic conditions and inflation may contribute to a reduction in consumer demand, which may reduce vehicle production over at least the next several quarters. We cannot be certain of the severity and length of the continued volatility in the global automotive market, and the extent of the adverse effect that such volatility could have on our results of operations, financial condition, and business in the long term.

WeCross-border ~~engage~~Trade inIssues ~~research~~ and development activities pertinent to automotive security, access control and user interface controls. A major area of focus for research is the expanding role of vehicle security, access and user interface via electronic interlocks and modes of communicating authorization data between consumers and vehicles. Development activities include new products, applications and product performance improvements. In addition, specialized data collection equipment is developed to facilitate increased product development efficiency and continuous quality improvements. For fiscal years 2024 and 2023, we incurred approximately $14.8 million and $15.9 million, respectively, on research and development expenses. We believe that, historically, we have committed sufficient resources to research and development and we intend to continue to invest in the future as required to support additional product programs associated with both existing and new customers. Patents are pursued and will continue to be pursued as appropriate to protect our interests resulting from these activities.Tariffs

Our operations are impacted by international or cross-border trade dynamics, particularly the import and export of products and goods into and out of the United States. The shipping of goods across national borders is often more expensive and complicated than domestic shipping. Customs and duty procedures and reviews, including duty-free thresholds in various key markets, the application of tariffs, and security-related governmental processes at international borders, may increase costs, discourage cross-border purchases, delay transit and create shipping uncertainties. The imposition of non-tariff barriers, including localized content rules and government procurement restrictions, may further limit our ability to operate efficiently across borders.

We manufacture our products in Mexico and rely on a global supply chain to provide raw materials and components that we need to manufacture our products. Our business benefits from certain free trade agreements, such as the United States-Mexico-Canada Agreement ("USMCA"). However, recent shifts in trade policy have resulted in new or higher tariffs on goods imported from numerous countries, and some countries have imposed retaliatory tariffs on imports from the United States, which has created meaningful uncertainty. These changes may result in significantly increased production costs, pricing volatility and administrative complexity in determining country-of-origin compliance for automotive components.

In addition to potential increases in customs duties and tariffs in the United States and other countries, the USMCA is subject to renewal in 2026. There can be no assurance that the USMCA will be renewed or, if renewed, any newly negotiated terms in the USMCA will not adversely affect our business. Also, China presents unique risks to U.S. automotive manufacturers due to the strain in U.S.-China

~~Customer~~relations ~~Tooling~~and the level of integration with key components in our global supply chain. It remains unclear what additional actions the current U.S. administration may take with respect to trade issues involving China and other countries.

WeChanges ~~incur~~in ~~costs~~U.S. ~~related~~trade torelations ~~tooling~~with ~~used~~foreign countries involved in ~~component~~our ~~production~~business, including but not limited to Mexico, Canada, China, and ~~assembly. Some~~European ofcountries, ~~these~~could have a material effect on global economic conditions and significantly decrease global trade, which could adversely impact our production costs, ~~are~~purchased ~~reimbursed~~material bycosts, ~~customers~~ability ~~who~~to ~~then~~compete, ~~own~~customer ~~the~~demand, ~~tools~~short-term ~~involved~~vehicle production levels and relationships with suppliers and customers. ~~See~~ ~~the~~The ~~information~~ultimate ~~set~~impact ~~forth~~of ~~under~~changes ~~“Organization~~to tariffs and ~~Summary~~trade barriers will depend on a number of ~~Significant~~factors ~~Accounting~~that ~~Policies-Customer~~are ~~Tooling~~not inyet ~~Progress”~~known ~~included~~or inare ~~Notes~~subject to ~~Financial~~change, ~~Statements~~including ~~under~~the ~~Item~~timing, 8amount, inscope ~~this~~and ~~Form~~nature ~~10-K.~~of any tariffs and trade barriers that are implemented.

~~Environmental~~Highly ~~Compliance~~Competitive Automotive Supply Industry

AsThe automotive component supply industry is highly competitive. New business is typically awarded to the ~~case~~supplier ~~with~~offering ~~other~~the ~~manufacturers,~~most wefavorable ~~are~~combination ~~subject~~of totechnological ~~federal~~innovation, ~~state~~quality, ~~local~~delivery and ~~foreign~~price. ~~laws~~There ~~and~~can ~~other~~be ~~legal~~no ~~requirements~~assurance ~~relating~~that we will be able to compete successfully with the ~~generation,~~products ~~storage,~~of ~~transport,~~our ~~treatment~~competitors. Our competitors' efforts to grow market share could exert downward pressure on our product pricing and ~~disposal~~margins. ofVertical ~~materials~~integration by competitors and customers, as awell ~~result~~as ofwithin our ~~manufacturing~~supply chain, could complicate and ~~assembly~~impact ~~operations~~sourcing decisions by our customers and adversely affect our sales. ~~These~~Some ~~laws~~of ~~include~~our ~~the~~competitors ~~Resource~~may ~~Conservation~~have larger customer bases and ~~Recovery~~significantly ~~Act~~greater ~~(as~~financial, ~~amended)~~technical, ~~the~~and ~~Clean~~marketing ~~Air~~resources ~~Act~~than ~~(as~~we ~~amended),~~do. ~~the~~These ~~Clean~~factors ~~Water~~may ~~Act~~allow ofour ~~1990~~competitors ~~(as~~to ~~amended)~~respond more quickly than we can to new or emerging technologies and ~~the~~changes ~~Comprehensive~~in ~~Environmental~~customer ~~Response~~requirements by devoting greater resources than we can to the development, ~~Compensation~~promotion and ~~Liability~~sale ~~Act~~of ~~(as~~automotive ~~amended)~~aftermarket products. WeIncreased ~~have~~competition ancould ~~environmental~~put ~~management~~additional ~~system~~pressure ~~that~~on isus ~~ISO-14001~~to ~~certified. We~~reduce ~~believe~~prices ~~that~~or ~~our~~take ~~existing~~other ~~environmental~~actions, ~~management~~which ~~system~~may ishave ~~adequate~~an adverse effect on our business, sales, financial condition and weresults ~~have~~of nooperations. ~~current~~We ~~plans~~may ~~for~~also ~~substantial~~lose ~~capital~~significant ~~expenditures~~customers inor ~~the~~lines ~~environmental~~of ~~area~~business to competitors.

AsCyclicality ~~discussed in “Commitments~~ and ~~Contingencies”~~Seasonality ~~under Notes to Financial Statement under Item 8~~ in ~~this Form 10-K, a site at our Milwaukee facility is contaminated by a solvent spill from a former above-ground solvent storage tank located on~~ the ~~east~~Automotive ~~side of the facility, which spill occurred in 1985. We continue to monitor this situation.~~ Market

WeHistorically, doour ~~not~~operating ~~currently~~results ~~anticipate~~have ~~any~~fluctuated ~~materially~~by ~~adverse~~quarter ~~impact~~based on ~~our~~the ~~financial~~ebbs ~~statements~~and orflows ~~competitive~~of ~~position~~automotive asvehicle aproduction ~~result~~levels. ofThe ~~compliance~~automotive ~~with~~market ~~federal,~~is ~~state,~~cyclical ~~local~~ and ~~foreign~~is ~~environmental~~dependent ~~laws~~on orconsumer ~~other~~spending, ~~legal~~on ~~requirements.~~the ~~However,~~availability ~~risk~~ of ~~environmental~~consumer ~~liability~~credit, ~~and~~interest ~~charges~~rates, ~~associated~~fuel ~~with~~prices, ~~maintaining~~consumer ~~compliance~~preference ~~with~~and ~~environmental~~confidence, ~~laws~~and isto ~~inherent~~a incertain ~~the~~extent, ~~nature~~on ofcustomer ~~our~~sales ~~business~~incentives. ~~and~~Economic ~~there~~factors isadversely noaffecting ~~assurance~~consumer ~~that~~demand ~~material~~for ~~liabilities~~automobiles orand ~~charges~~automotive production, could ~~not~~adversely ~~arise~~impact our financial results.

~~Human~~Market ~~Capital~~Acceptance of New or Enhanced Products

AtThe ~~June~~growth ~~30,~~of ~~2024,~~the weCompany's ~~had~~business ~~3,365~~will ~~associates~~be ~~worldwide,~~dependent ofon ~~which~~the ~~457~~demand ~~were~~for ~~employed~~innovative products. In order to increase sales in current markets and gain entry into new markets, the ~~United~~Company ~~States~~must innovate to maintain and ~~2,905~~improve ~~were~~existing ~~employed~~products ~~outside~~while ofsuccessfully ~~the~~developing ~~United~~and ~~States.~~introducing ~~170~~distinctive ornew ~~5.1~~and ~~percent~~enhanced ~~were~~products ~~represented~~that byanticipate achanging ~~collective~~customer ~~bargaining~~and ~~agreement~~consumer atpreferences ~~our~~and ~~Milwaukee,~~capitalize ~~Wisconsin~~upon ~~facility,~~emerging ~~all~~software oftechnologies, ~~whom~~including ~~are~~hybrid ~~our~~and ~~production~~electric ~~associates~~vehicle advances. ~~Approximately~~We ~~152~~principally orcompete ~~4.5~~for ~~percent~~new ~~were~~business ~~represented~~at bythe abeginning ~~collective~~of ~~bargaining~~the ~~agreement~~development atof ~~our~~new ~~Leon,~~models ~~Mexico~~and ~~facility~~upon the redesign of existing models by our customers. InNew ~~recent~~model ~~years,~~development wegenerally ~~have~~begins ~~not~~two ~~experienced~~to ~~any~~five ~~significant~~years ~~work~~prior ~~slowdowns,~~to ~~stoppages~~the ormarketing ~~other~~of ~~labor~~such ~~disruptions~~new models. The ~~current~~failure ~~contract~~to ~~with~~obtain ~~our~~new ~~Milwaukee~~business ~~unionized~~on ~~associates~~new isvehicle ~~effective~~models ~~through~~or ~~November~~to 1,retain ~~2025.~~or ~~The~~increase ~~current~~business ~~contract~~on ~~with~~redesigned ~~our~~existing ~~Leon~~models ~~unionized~~could ~~associates~~result isin ~~effective~~reduced ~~through~~net ~~April~~sales. 8In addition, ~~2025~~we may incur significant product development expenses in preparing to meet anticipated customer requirements which may not be recovered.

WeJoint are guided by our “Values and Beliefs” mission statement that focuses on Empowerment, Communication, Citizenship, Enterprise, Change and Consensus. We remain committed to areas of work place safety, product quality and customer satisfaction. Successful execution of our mission is dependent on attracting, developing and retaining key associates and members of our management team, as well as providing competitive pay and benefits.Ventures

~~Social~~Certain ~~Responsibility~~of our operations are conducted through a joint venture with ADAC Automotive. With respect to our joint venture, we may share ownership and management responsibilities with a partner that may not share our goals and objectives. Operating a joint venture requires us to manage the business pursuant to the terms of the agreement that we entered into in fiscal 2007 with our partner, which may require additional organizational formalities, as well as the sharing of information and decision making. Additional risks associated with joint ventures include one or more partners failing to satisfy contractual obligations, the ability to enforce such obligations, conflicts arising between us and our partner, a change in the ownership of any of our partners and a reduced ability to control compliance with applicable rules and regulations. Additionally, our ability to sell our interest in a joint venture may be subject to contractual and other limitations. Accordingly, any such occurrence could adversely affect our financial condition, operating results and cash flows.

WeOperational are committed to conducting business and making decisions honestly, fairly and within the law, and are guided by our “Values and Beliefs” mission statement. We are dedicated to earning and keeping the trust and confidence of our shareholders, customers and associates as well as the communities where we do business. Risks

~~Our~~Shortages, ~~“Code~~Increases ~~of Business Ethics” provides guidelines and a framework for conducting business~~ in an ethical manner. These beliefs go beyond STRATTEC and are expected of our suppliers as detailed in our “Supplier Code of Conduct.” We have adopted policies that seek to eliminate human traffickingCosts, ~~slavery,~~or ~~child~~Other ~~labor~~Restrictions ~~and~~on ~~similar unethical and illegal practices from our global supply chain. In addition, we annually compile and file a Form SD with~~ the ~~Securities~~Availability ~~and Exchange Commission regarding “Conflict Minerals Disclosure and Report” as directed by the Dodd-Frank Wall Street Reform and Consumer Protection Act~~ of ~~2010.~~Raw ~~The~~Materials ~~purpose of this report is to help prevent products used to finance~~ or ~~benefit~~Components ~~armed groups in the covered countries of this filing.~~ Supply

~~Our~~If ~~commitment~~any toof our ~~environment~~customers isexperience ~~documented~~a inmaterial ~~our~~supply ~~“Environmental Management System~~shortage,” ~~which~~either ~~provides~~directly ~~for~~or ~~continuous~~as ~~improvement~~a result of ~~our~~supply ~~efforts~~shortages ~~toward~~at ~~preventing~~another ~~pollution~~supplier, ~~complying~~that ~~with~~customer ~~relevant~~may ~~environmental~~halt ~~legislation~~or ~~and~~limit ~~regulations~~the ~~and~~purchase ~~complying~~of ~~with~~our ~~customer-based environmental regulations~~products. ~~In addition~~Similarly, if we ~~maintain~~or one of our own ~~IATF~~suppliers ~~16949:2016~~experiences ~~and~~a ~~ISO~~supply ~~14001 annual certifications~~shortage, ~~which~~we ~~are~~may ~~globally~~become ~~recognized~~unable ~~quality~~to ~~standards~~produce ~~for~~ the ~~automotive~~affected ~~industry.~~products ~~STRATTEC’s~~if ~~major~~we ~~initiatives~~cannot inprocure ~~this~~the ~~area~~components ~~consist~~from ofanother ~~energy~~source. ~~improvement~~Such ~~initiatives,~~disruptions ~~primarily~~may ~~related to solar in Milwaukee, WI, Auburn Hills, MI, and Juarez, Mexico, and moves to more energy efficient production capital equipment in Milwaukee, WI to reduce carbon emissions.~~

~~Available~~arise ~~Information~~due to any number of issues including catastrophic events such as natural disasters, global pandemics, war, rapid increases in demand, or unforeseen economic challenges like prolonged inflation or elevated interest rates. These shortages could impact our ability to meet production schedules for key products and could have a material adverse effect on our business, results of operations, financial condition and cash flows.

WeDuring ~~maintain~~recent ~~our~~fiscal ~~corporate website at www.strattec.com and make available~~years, ~~free~~we ofhave ~~charge,~~experienced ~~through~~higher ~~this~~costs ~~website our Code of Business Ethics, annual reports~~ on ~~Form~~raw ~~10-K,~~materials ~~quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements for annual shareholder meetings~~ and ~~amendments~~purchased ~~to those reports that we file with~~components, ~~or furnish to, the Securities and Exchange Commission (the "Commission")~~ as ~~soon~~well as ~~reasonably~~freight ~~practicable after we electronically file such material with, or furnish it to, the Commission~~costs. We ~~are~~The ~~not~~continuation ~~including all the information contained on~~ or ~~made~~renewal ~~available through our website as a part~~ of, orthese ~~incorporating~~cost ~~such~~increases ~~information~~could byhave ~~reference~~a ~~into, this Annual Report on Form 10-K. However, this report includes (or incorporates by reference) all~~ material ~~information~~adverse ~~about~~effect ~~STRATTEC that is included~~ on our ~~website~~future ~~which~~revenue, isfinancial ~~otherwise~~results, ~~required~~financial tocondition beand ~~included~~cash ~~in this report~~flows.

~~ITEM~~In 1Aorder to manage and reduce the costs of purchased goods and services, we have been rationalizing and consolidating our supply base. ~~RISK~~As ~~FACTORS~~a result, there is greater dependence on fewer sources of supply for certain components and materials used in our products. We consider the production capacities and financial condition of suppliers in our selection process, and expect them to meet our delivery requirements. However, there can be no assurance that strong demand, capacity limitations, shortages of raw materials, labor disputes or other problems will not result in any shortages, cost increases, or other restrictions on the availability of raw materials or components supplied to us.

WeForeign ~~recognize we are subject to the following risk factors based on our operations and the nature of the automotive industry in which we operate:~~Operations

~~BUSINESS~~We ~~RISKS~~operate manufacturing operations in Mexico. As these operations continue to expand, their success will depend, in part, on our ability to anticipate and effectively manage certain risks inherent in international operations, including: enforcing agreements and collecting receivables through certain foreign legal systems, payment cycles of foreign customers, compliance with foreign tax laws, general economic and political conditions in these countries and compliance with foreign laws and regulations.

~~Loss~~Cyber of Significant Customers, Vehicle Content, Vehicle Models and Market Share – Sales to General Motors Company, Ford Motor Company and Stellantis represented approximately 66 percent of our annual net sales (based on fiscal 2024 results) and, accordingly, these customers account for a significant percentage of our outstanding accounts receivable. The contracts with these customers provide for supplying the customer’s requirements for a particular model. The contracts do not specify a specific quantity of parts. The contracts typically cover the life of a model, which averages approximately four to five years. Components for certain customer models may also be “market tested” annually. Therefore, the loss of any one of these customers, the loss of a contract for a specific vehicle model, a reduction in vehicle content, the early cancellation of a specific vehicle model, technological changes or a significant reduction in demand for certain key models could occur, and if so, could have a material adverse effect on our existing and future revenues, operating results, financial condition and cash flows.Vulnerability

~~Our~~In ~~major~~the ordinary course of business, we collect and store sensitive data, including our proprietary business information and that of our customers, ~~also~~suppliers ~~have~~and ~~significant~~business ~~under-funded~~partners, ~~legacy~~as ~~liabilities~~well ~~related~~as topersonally ~~pension~~identifiable information of our customers and ~~postretirement~~employees, ~~health~~in ~~care~~our ~~obligations~~internal data centers, cloud services and on our networks. The ~~loss~~secure inprocessing, maintenance and transmission of this information is critical to our ~~major~~operations ~~customers’~~and ~~North~~business ~~American~~strategy. ~~automotive~~Cybersecurity ~~market~~attacks ~~share~~are becoming more sophisticated and include, but are not limited to, ~~the~~malicious ~~New~~software ~~Domestic~~attempts ~~automotive~~to ~~manufacturers~~gain ~~(primarily~~unauthorized ~~the~~access ~~Japanese~~to data, and ~~Korean~~other ~~automotive~~electronic ~~manufacturers)~~security breaches that could lead to disruptions in critical systems, unauthorized release of confidential or otherwise protected information, corruption or destruction of data and/ other manipulation or aimproper ~~significant~~use ~~decline~~of insystems ~~the~~or ~~overall~~networks. ~~market~~Cybercriminals ~~demand~~have ~~for~~increasingly demonstrated advanced capabilities, such as use of zero-day vulnerabilities, and rapid integration of new ~~vehicles~~technology ~~may~~such ~~ultimately~~as ~~result~~generative inartificial ~~severe~~intelligence. ~~financial~~Despite ~~difficulty~~our ~~for~~security ~~these~~measures, our information technology and infrastructure, as well as that of our partners, customers and suppliers, may be vulnerable to malicious attacks, breaches or system failures due to employee error, malfeasance or other disruptions, including ~~bankruptcy~~as a result of rollouts of new systems. IfAny such breach or operation failure would compromise our ~~major~~networks or that of our business partners, customers ~~cannot~~or ~~fund~~suppliers, ~~their~~and the information stored could be accessed, publicly disclosed, lost or stolen, cause transaction processing errors, processing inefficiencies, delays or cancellation of customer orders, the loss of customers, impediments to the manufacturing or shipment of products, or other business disruptions. Such access or other loss of information could result in legal claims or proceedings, regulatory fines or penalties, disruption in our operations, wedamage ~~may~~to ~~incur~~our ~~significant~~reputation, ~~write-offs~~loss of ~~accounts~~confidence ~~receivable~~in our products and ~~inventory~~services, ~~incur~~increased ~~impairment~~costs, ~~charges~~ or ~~require~~the ~~restructuring~~loss ~~actions~~of assets, any of which could have a negative impact on our business, results of operations, financial condition and cash flows.

~~Production~~In ~~Slowdowns by Customers – Our major customers and many of their suppliers were significantly impacted by the Great Recession of 2008/2009~~addition, byas ~~the~~security ~~COVID-19 pandemic in 2020~~threats, ~~by supply chain issues resulting from the conflict in the Ukraine~~cybersecurity, ~~and~~data byprivacy ~~a semiconductor chip shortage in 2021~~ and ~~2022.~~protection ~~Many~~laws ~~of our major customers instituted production cuts during our fiscal 2009~~ and ~~2010~~regulations ~~due~~continue to ~~the~~evolve ~~Great Recession~~ and ~~shuttered~~increase ~~plants.~~in ~~Similarly,~~terms ~~during~~of ~~2020~~sophistication, ~~2021~~we ~~and~~may ~~2022~~be inrequired ~~response~~ to ~~the~~or ~~effects~~choose ofto ~~the~~invest ~~COVID-19~~additional ~~pandemic,~~resources ~~the~~in ~~Ukraine conflict and~~ the ~~semiconductor~~security ~~chip shortage, many~~ of our ~~major customers again instituted production cuts and shuttered plants~~systems. ~~While~~Any ~~production~~such ~~subsequently~~ increased ~~after~~level ~~the~~of ~~cuts~~investment made in 2009 and again in 2021 when plants reopened following the COVID-19 closures, the current Ukraine conflict and semiconductor chip shortage, any additional economic slowdowns, pandemics or part supply shortages could ~~bring~~adversely ~~about~~affect ~~new production cuts which could have a material adverse effect on~~ our ~~existing and future revenues, operating results,~~ financial condition ~~and~~or ~~cash~~results ~~flows~~of operations.

~~Cross-border~~Qualified Trade Issues or Tariffs – Our business is impacted by international or cross-border trade, including the import and export of products and goods into and out of the United States and trade tensions among nations. The shipping of goods across national borders is often more expensive and complicated than domestic shipping. Customs and duty procedures and reviews, including duty-free thresholds in various key markets, the application of tariffs, and security related governmental processes at international borders, may increase costs, discourage cross-border purchases, delay transit and create shipping uncertainties. Further, uncertainties stemming from changes in U.S. trade policies in particular with European countries and China, tariffs and the reaction of other countries thereto, could have an adverse effect on our business and may adversely impact our results of operations, financial condition and cash flows or reduce profitability on certain of our products.Personnel

Our business success depends, to a significant degree, on attracting and retaining qualified personnel. Our ability to sustain and grow our business requires us to hire, retain, develop and motivate a highly skilled and diverse management team and workforce. These types of employees are in high demand and often have competing employment opportunities. The labor market for skilled employees is highly competitive and we may lose key employees or be forced to increase their compensation to retain these types of employees. Failure to ensure that we have the leadership capacity with the necessary skill set and experience could impede our ability to deliver our growth objectives and execute our strategic plan. Organizational and reporting changes resulting from any future leadership transition or corporate initiatives could result in increased turnover. Additionally, any unplanned turnover or inability to attract and retain key employees could have a negative effect on our results of operations, including by significantly increasing our recruitment, training and other related employee costs. Moreover, the loss of key personnel, or the failure to attract qualified personnel, could have a material adverse effect on our business, results of operations, financial condition and cash flows.

~~Highly~~Disruptions ~~Competitive~~Due Automotive Supply Industry – The automotive component supply industry is highly competitive. Some of our competitors are companies, or divisions or subsidiaries of companies, that are larger than STRATTEC and have greater financial, global and technology capabilities. Our products may not be able to ~~compete~~Work ~~successfully~~Stoppages ~~with the products of these other companies, which could result in loss of customers~~ and, asOther aLabor result, decreased sales and profitability. Some of our major customers have previously announced that they will be reducing their supply base. This could potentially result in the loss of these customers and consolidation within the supply base. The loss of any of our major customers could have a material adverse effect on our existing and future revenues, results of operations, financial condition and cash flows.Matters

InOur ~~addition,~~major ~~our~~customers ~~competitive~~and ~~position~~many inof ~~the~~their ~~North~~suppliers ~~American~~have ~~automotive~~unionized ~~component~~workforces. ~~supply~~Work ~~industry~~stoppages ~~could~~or beslowdowns ~~adversely~~experienced ~~affected~~by inour ~~the~~customers ~~event~~or ~~that~~their wesuppliers ~~are~~could ~~unsuccessful~~result in ~~making~~slowdowns ~~strategic investments, acquisitions~~ or ~~alliances~~closures orof inassembly ~~establishing~~plants ~~joint~~where ~~ventures~~our ~~that~~products ~~would~~are ~~enable~~included usin toassembled ~~expand globally~~vehicles. WeA ~~principally~~material ~~compete~~work ~~for~~stoppage ~~new~~experienced ~~business~~by atone ~~the~~or ~~beginning~~more of ~~the development of new models and upon the redesign of existing models by~~ our ~~major~~ customers. ~~New~~or ~~model~~suppliers ~~development~~could ~~generally~~have ~~begins~~an ~~two~~adverse toeffect ~~five years prior to the marketing of such new models to the public. The failure to obtain new business~~ on ~~new models or to retain or increase business on redesigned existing models could adversely affect~~ our business and financial results. In addition, as a result of relatively long lead times for many of our components, it may be difficult in the short-term for us to obtain new sales to replace any unexpected decline in the sale of existing products. Finally, we may incur significant product development expense in preparing to meet anticipated customer requirements which may not be recovered.

~~Cyclicality~~In ~~and~~addition, ~~Seasonality~~all inproduction ~~the~~associates ~~Automotive~~at ~~Market~~our –Milwaukee ~~The~~facility ~~automotive~~are ~~market~~unionized. isThe ~~cyclical~~current ~~and~~contract iswith ~~dependent~~our onMilwaukee ~~consumer~~unionized ~~spending,~~associates onis ~~the~~effective ~~availability~~through ofNovember ~~consumer~~1, ~~credit~~2025. ~~and~~We toalso ahave ~~certain~~unionized ~~extent,~~associates onat ~~customer~~our ~~sales~~Leon, ~~incentives~~Mexico facility. ~~Economic~~The ~~factors~~current ~~adversely~~contract ~~affecting~~with ~~consumer~~our ~~demand~~Leon ~~for~~unionized ~~automobiles~~associates ~~and~~is ~~automotive~~effective ~~production,~~through ~~such~~April ~~as rising fuel costs~~8, ~~could~~2026. ~~adversely~~We ~~impact~~may ~~our~~encounter ~~net~~labor ~~sales~~disruption and ~~net~~we ~~income.~~may Wealso ~~typically~~encounter ~~experience~~unionization ~~decreased~~efforts ~~sales~~in ~~and~~our ~~operating~~other ~~income~~plants ~~during~~or ~~the~~other ~~first~~types ~~fiscal quarter~~ of ~~each~~labor ~~year~~conflicts, ~~due~~any toof ~~the~~which ~~impact~~could ofhave ~~scheduled~~an ~~customer~~adverse ~~plant~~effect ~~shut-downs~~on inour ~~July~~business, ~~and~~financial ~~new~~results, ~~model~~financial ~~changeovers~~condition ~~during~~and ~~that~~cash ~~period~~flows.

~~OPERATIONAL~~Climate ~~RISKS~~Change and Environmental, Social, and Governance (ESG) Matters

~~Shortage~~Natural ofdisasters ~~Raw Materials~~ or ~~Components~~extreme ~~Supply~~weather –conditions Inresulting ~~the~~from ~~event of catastrophic acts of nature such as fires, tsunamis, hurricanes, earthquakes and~~ global ~~pandemics~~climate ~~and~~change ~~wars,~~could alead ~~rapid increase in production demands or other unforeseen economic events such has prolonged periods of inflation~~us, ~~either we or~~ our customers or ~~other~~our suppliers ~~may~~to experience ~~supply~~disruptions ~~shortages~~in ofoperations ~~raw materials~~ or ~~components.~~disruptions ~~This could be caused by a number of factors, including a lack of production line capacity or manpower, working capital constraints or adverse conditions~~ in ~~banking and capital markets. In order to manage and reduce~~ the ~~costs~~availability of ~~purchased~~key ~~goods and services~~components, wewhich ~~and~~could ~~others~~lead ~~within~~to ~~our industry have been rationalizing and consolidating our supply base. As~~ a ~~result,~~material ~~there~~adverse isimpact ~~greater dependence~~ on ~~fewer~~our ~~sources~~results of ~~supply~~operations, ~~for~~financial ~~certain~~condition ~~components~~ and ~~materials~~cash ~~used~~flows. inWe ~~our products, which~~ could ~~increase~~also ~~the~~experience ~~possibility~~adverse ofimpacts ato ~~supply shortage of any particular component. If any of~~ our ~~customers~~financial ~~experience~~condition adue ~~material~~to ~~supply~~volatility ~~shortage,~~in ~~either~~the ~~directly~~cost or asavailability ~~a result~~ of ~~supply shortages at another supplier~~capital, ~~that~~difficulty ~~customer~~obtaining ~~may~~new ~~halt~~business or ~~limit~~entering ~~the~~into ~~purchase~~new ofsupplier ~~our products. Similarly~~relationships, ifa wepossible orloss ~~one~~ of ~~our~~market ~~own~~share ~~suppliers~~on ~~experience~~our acurrent ~~supply~~product ~~shortage~~portfolio, wefines ~~may~~and ~~become~~penalties ~~unable~~or todifficulty ~~produce~~attracting ~~the affected products if we cannot procure the components from another source. Such production interruptions could impede a ramp-up in vehicle production~~ and ~~could~~retaining ~~have~~ a ~~material~~skilled ~~adverse effect on our business, results of operations, financial condition and cash flows~~workforce.

WeFurther, ~~consider~~various ~~the~~stakeholders, ~~production~~including ~~capacities~~customers, ~~and~~suppliers, ~~financial~~lenders, ~~condition~~regulators, ofinvestors ~~suppliers~~and those in ~~our~~the ~~selection process~~workforce, ~~and~~are ~~expect~~increasing ~~that~~their ~~they~~expectations ~~will~~for ~~meet~~businesses ~~our~~to ~~delivery~~do ~~requirements.~~more ~~However,~~to ~~there~~combat ~~can~~global beclimate nochange ~~assurance~~and ~~that~~its ~~strong demand~~impact, ~~capacity~~and ~~limitations,~~to ~~shortages~~conduct oftheir ~~raw~~operations ~~materials,~~in ~~labor~~an ~~disputes~~environmentally orsustainable ~~other~~manner ~~problems~~with ~~will~~appropriate ~~not~~oversight ~~result~~by insenior ~~any~~leadership. A ~~shortages~~failure orto ~~delays~~respond into the ~~supply~~expectations and initiatives of ~~components~~our stakeholders could result in damage to usour reputation and relationships with various stakeholders.

~~Because~~In ofaddition to the ~~COVID-19~~increased ~~pandemic~~stakeholder ~~and~~focus ~~the~~on ~~Ukraine~~climate ~~conflict~~change, wecustomer, ~~have~~investor, ~~experienced~~and ~~supply~~employee ~~chain~~expectations ~~disruptions~~ in ~~particular~~sustainability ~~with~~have ~~semiconductor~~been ~~chip~~rapidly ~~shortages~~evolving ~~that~~and ~~impact~~increasing. The ~~our~~enhanced ~~OEM~~stakeholder ~~customers’~~focus ~~ability~~on tosustainability ~~finish~~requires ~~assembly~~continuous monitoring of ~~new~~various ~~vehicles~~and evolving regulations and ~~which~~standards ~~have~~and ~~adversely~~their ~~impacted~~associated ~~orders~~requirements. Our ~~for~~failure, or that of our ~~products~~supply ~~and~~base, ~~accordingly~~to adequately meet stakeholder expectations may result in, ~~our~~among ~~results~~other things, the loss of ~~operations~~business, ~~and~~diluted ~~cash~~market ~~flows.~~valuation, ~~The~~an ~~continuation~~inability orto ~~renewal~~attract ofcustomers ~~these~~or ~~impacts~~an ~~could~~inability ~~have~~to aattract ~~material~~and ~~adverse~~retain ~~effect~~top ontalent ~~our~~that ~~future~~could ~~revenues,~~adversely ~~financial~~affect ~~results~~our business, financial condition ~~and~~or ~~cash~~results ~~flows~~of operations.

~~Sources~~Financial of and Fluctuations in Market Prices of Raw Materials – Our primary raw materials are high-grade zinc, brass, nickel silver, aluminum, steel and plastic resins, which are typically sourced from a limited number of suppliers. We believe our sources of raw materials are reliable and adequate for our needs. However, the development of future sourcing issues related to using existing or alternative raw materials and the global availability of these materials as well as significant fluctuations in the market prices of these materials may have an adverse effect on our results of operations, financial condition and cash flows if the increased raw material costs cannot be recovered from our customers. During recent fiscal years, we experienced higher raw material costs on the items listed above including freight costs on both raw material and purchased components.Risks

~~Given~~Financial ~~the~~Distress ~~significant financial impact on us relating to changes in the cost~~ of ~~our~~Automotive ~~primary~~Supply raw materials, commencing with fiscal 2008 and thereafter, we began quoting quarterly material price adjustments for changes in our zinc costs in our negotiations with our customers. Our success in obtaining these quarterly price adjustments in our customer contracts is dependent on separate negotiations Base

Unfavorable global, economic or industry conditions could result in the financial distress of the automotive supply base. Severe distress could lead to automotive suppliers filing for bankruptcy protection or ceasing operations. Such conditions may require us to provide financial assistance or other measures to ensure uninterrupted production. These conditions could have a material adverse effect on our existing and future revenues, financial results, financial condition and cash flows.

Cost Reduction

There is continuing pressure from our major customers to reduce the prices we charge for our products. This requires us to continually generate cost reductions, including reductions in the cost of components purchased from outside suppliers. If we are unable to generate sufficient production cost savings in the future to offset pre-programmed price reductions or additional price reduction demands, our gross margin and profitability will be adversely affected.

Currency Exchange Rate Fluctuations

We have manufacturing operations in Mexico, and as a result, a portion of our manufacturing costs are incurred in Mexican pesos. Therefore, fluctuations in the U.S. dollar/Mexican peso exchange rate may have a material effect on our profitability, cash flows and financial position and may significantly affect the comparability of our results between financial periods. Any depreciation in the value of the U.S. dollar in relation to the value of the Mexican peso will adversely affect the cost of our Mexican operations when translated into U.S. dollars.

~~with~~Program ~~each~~Volume ~~customer.~~and ItPricing is not a standard practice for our customers to include such price adjustments in their contracts. We have been successful in obtaining quarterly price adjustments in some of our customer contracts. However, we have not been successful in obtaining the adjustments with all of our customers.Fluctuations

~~Foreign~~We ~~Operations~~incur –costs Weand ~~operate~~make ~~wholly~~capital ~~owned~~expenditures ~~and~~for ~~majority~~new ~~owned~~program ~~manufacturing~~awards ~~operations~~based inupon ~~Mexico.~~certain Asestimates ~~these~~of ~~operations~~production ~~continue~~volumes toover ~~expand,~~the ~~their~~anticipated ~~success~~program ~~will~~life ~~depend,~~for incertain ~~part,~~vehicles. onWhile ~~our~~we ~~ability~~attempt to ~~anticipate~~establish ~~and~~the ~~effectively~~price ~~manage~~of ~~certain~~our ~~risks~~products ~~inherent~~to account for variations in ~~international~~production ~~operations~~volumes, ~~including:~~if ~~enforcing~~the ~~agreements~~actual ~~and~~production ~~collecting~~of ~~receivables~~certain ~~through~~vehicle ~~certain~~models ~~foreign~~is ~~legal~~significantly ~~systems~~less than planned, ~~payment~~our ~~cycles~~net ofsales ~~foreign~~and ~~customers,~~net ~~compliance~~income ~~with~~may ~~foreign~~be ~~tax~~adversely ~~laws,~~affected. ~~general~~We ~~economic~~cannot ~~and~~predict ~~political~~our ~~conditions~~customers’ indemands ~~these~~for ~~countries~~the ~~and~~products ~~compliance~~we ~~with~~supply ~~foreign~~either ~~laws~~in ~~and~~the ~~regulations.~~aggregate or for particular reporting periods.

~~Cyber~~Existing ~~Vulnerability~~Indebtedness ~~– In the ordinary course of business, we collect~~ and ~~store~~Ability sensitive data, including our proprietary business information and that of our customers, suppliers and business partners, as well as personally identifiable information of our customers and employees, in our internal data centers, cloud services and on our networks. The secure processing, maintenance and transmission of this information is critical to ~~our~~Access ~~operations~~Capital and business strategy. Cybersecurity attacks are becoming more sophisticated and include, but are not limited to, malicious software attempts to gain unauthorized access to data, and other electronic security breaches that could lead to disruptions in critical systems, unauthorized release of confidential or otherwise protected information, corruption or destruction of data and other manipulation or improper use of systems or networks. Despite our security measures, our information technology and infrastructure, as well as that of our partners, customers and suppliers, may be vulnerable to malicious attacks, breaches or system failures due to employee error, malfeasance or other disruptions, including as a result of rollouts of new systems. Any such breach or operation failure would compromise our networks or that of our business partners, customers or suppliers, and the information stored could be accessed, publicly disclosed, lost or stolen, cause transaction processing errors, processing inefficiencies, delays or cancellation of customer orders, the loss of customers, impediments to the manufacturing or shipment of products, or other business disruptions. Although we have cybersecurity insurance in place, such access or other loss of information could result in legal claims or proceedings, regulatory fines or penalties, disruption in our operations, damage to our reputation, loss of confidence in our products and services, increased costs, or the loss of assets, any of which could have a negative impact on our business, results of operations, financial condition and cash flows. In addition, as security threats and cybersecurity and data privacy and protection laws and regulations continue to evolve and increase in terms of sophistication, we may be required to or choose to invest additional resources in the security of our systems. Any such increased level of investment could adversely affect our financial condition or results of operations. We have programs in place to address and mitigate cybersecurity risks. These programs include regular monitoring of outside threats, continuous update of software to mitigate risk, education of employees to the risks of external threats, and simplification of infrastructure to minimize servers. Although we believe the foregoing programs are reasonable actions to mitigate cybersecurity risks, the failure of these programs to adequately protect against these risks could have a negative impact on our business, results of operations, financial condition and cash flows.Markets

~~Qualified~~From ~~Personnel~~time –to ~~Our~~time ~~business~~we ~~success~~have ~~depends,~~relied toon aour ~~significant~~existing ~~degree,~~credit onfacilities ~~attracting~~to ~~and~~provide ~~retaining~~us ~~qualified~~with ~~personnel.~~adequate ~~Our~~working ~~ability~~capital to ~~sustain~~operate our business and ~~grow~~fund our ~~business~~capital ~~requires~~expenditures, usincluding toany ~~hire,~~expansion ~~retain,~~initiatives. ~~develop~~Escalation ~~and~~of ~~motivate~~any aglobal ~~highly~~inflationary ~~skilled~~pressures ~~and~~on ~~diverse~~our ~~management~~operating ~~team~~results ~~and~~may ~~workforce.~~impact ~~These~~our ~~types~~ability ofto ~~employees~~satisfy ~~are~~our lending covenants in ~~high~~the ~~demand~~short ~~and~~term. ~~often~~Additionally, ~~have~~we ~~competing~~cannot ~~employment~~provide ~~opportunities.~~assurance ~~The~~that ~~labor~~we ~~market~~will ~~for~~be ~~skilled~~able ~~employees~~to isrefinance, ~~highly~~extend ~~competitive~~the ~~and~~maturity weof, ~~may~~or ~~lose~~otherwise ~~key~~amend ~~employees~~the terms of our existing credit facilities, or bethat ~~forced~~any torefinancing, ~~increase~~extension, ~~their~~or ~~compensation~~amendment will be on terms favorable to ~~retain~~us ~~these~~or ~~types~~even ofon ~~employees~~commercially reasonable terms. ~~Failure~~ If our lenders reduce or terminate our access to ~~ensure~~amounts ~~that~~under our credit facilities, we may not have ~~the~~sufficient ~~leadership~~capital ~~capacity~~to ~~with~~fund ~~the~~our ~~necessary~~working ~~skill~~capital ~~set~~needs and/or ~~experience~~we ~~could~~may ~~impede~~need ~~our~~to ~~ability~~secure additional capital or financing to ~~deliver~~fund our ~~growth~~working ~~objectives~~capital ~~and~~requirements ~~execute~~or to repay outstanding debt under our ~~strategic~~credit ~~plan~~facilities. ~~Organizational~~Moreover, ~~and~~new ~~reporting~~credit ~~changes~~facilities resulting from any ~~future~~refinancing ~~leadership~~of ~~transition~~our orexisting ~~corporate~~facilities ~~initiatives~~ could ~~result~~have ina ~~increased~~significantly ~~turnover.~~higher ~~Additionally,~~rate ~~any~~of ~~unplanned~~interest ~~turnover~~and orgreater ~~inability~~borrowing tocosts ~~attract~~than ~~and~~our ~~retain~~existing ~~key~~facilities. ~~employees~~We ~~could~~can ~~have~~make ano ~~negative~~assurance ~~effect~~that onwe will be successful in ensuring our ~~results~~availability of ~~operations,~~amounts ~~including~~under byour ~~significantly~~credit ~~increasing~~facilities ~~our~~or ~~recruitment,~~in ~~training~~connection with raising additional capital and ~~other~~that ~~related~~any ~~employee~~amount, ~~costs. Moreover~~if raised, ~~the~~will ~~loss~~be ofsufficient ~~key~~to ~~personnel,~~meet orour ~~the~~cash ~~failure~~flow requirements. If we are not able to ~~attract~~maintain ~~qualified~~our ~~personnel,~~borrowing ~~could~~availability under our credit facilities it may have a ~~material~~negative ~~adverse~~impact ~~effect~~ on our business, results of operations, financial condition and cash flows.

~~Disruptions~~Legal ~~Due to Work Stoppages~~ and ~~Other~~Regulatory Labor Matters – Our major customers and many of their suppliers have unionized work forces. Work stoppages or slow-downs experienced by our customers or their suppliers could result in slow-downs or closures of assembly plants where our products are included in assembled vehicles. For example, strikes by a critical supplier called by the United Auto Workers led to extended shut-downs of most of General Motors’ North American assembly plants in February 2008 and September 2019. A material work stoppage experienced by one or more of our customers could have an adverse effect on our business and our financial results. In addition, all production associates at our Milwaukee facility are unionized. A sixteen-day strike by these associates in June 2001 resulted in increased costs as all salaried associates worked with additional outside resources to produce the components necessary to meet customer requirements. The current contract with our Milwaukee unionized associates is effective through November 1, 2025. We also have unionized associates at our Leon, Mexico facility. The current contract with our Leon unionized associates is effective through April 8, 2025. We may encounter further labor disruption and we may also encounter unionization efforts in our other plants or other types of labor conflicts, any of which could have an adverse effect on our business, financial results, financial condition and cash flows. Labor contracts between General Motors Company, Ford Motor Company and Stellantis and their unionized associates under the United Auto Workers union expire in April 2028. In addition, their respective labor Risks

Intellectual Property

We own intellectual property, including patents, trademarks, copyrights, and trade secrets, that are of importance to our business, in the aggregate. Our intellectual property plays an important role in maintaining our competitive position in the markets we serve. We may directly or through a supplied component utilize intellectual property in its products that requires a license from a third-party. While we believe that such licenses generally can be obtained by us, or supplier if a supplied component, we may not be able to obtain the necessary licenses on commercially acceptable terms or at all. Failure by us or our suppliers to obtain the right to use third-party intellectual property could preclude us from selling certain products, and developments or assertions by or against us relating to intellectual property rights, could have materially adverse effects on our business, operating results, financial condition, and cash flow.

Environmental, Safety and Other Regulations

We are subject to federal, state, local and foreign laws and other legal requirements related to the generation, storage, transport, treatment and disposal of materials as a result of our manufacturing and assembly operations. These laws include, among others, the Resource Conservation and Recovery Act (as amended), the Clean Air Act (as amended) and the Comprehensive Environmental Response, Compensation and Liability Act (as amended). We believe that our existing environmental management system is adequate for current and anticipated operations.

An environmental liability was established in 1995 for estimated costs to remediate an environmental matter impacting a portion of our Milwaukee facility. The contamination occurred in 1985 and, after initial remediation, is being monitored in accordance with federal, state and local requirements. Failure to comply with environmental regulations could result in fines, penalties, and legal liabilities, as well as damage to our reputation. Additionally, changes in environmental laws and regulations or in the enforcement of existing laws and regulations could result in increased compliance costs in excess of our existing liability or additional operating restrictions, which could adversely affect our business, financial condition, and results of operations.

Income Taxes

We are a U.S.-based multinational company subject to tax in multiple U.S. and foreign tax jurisdictions. Significant judgment is required in determining our global provision for income taxes, deferred tax assets or liabilities and in evaluating our tax positions on a worldwide basis. While we believe our tax positions are consistent with the tax laws in the jurisdictions in which we conduct our business, it is possible that these positions may be overturned by jurisdictional tax authorities, which may have a significant impact on our global provision for income taxes. We are also subject to ongoing tax audits. These audits can involve complex issues, which may require an extended period of time to resolve and can be highly subjective. Tax authorities may disagree with certain tax reporting positions taken by us and, as a result, assess additional taxes. Failure to comply with these tax laws and regulations could result in significant penalties,

~~agreements~~fines, ~~with~~and ~~the~~interest ~~Canadian~~charges. ~~auto~~Additionally, ~~workers~~changes ~~union expire~~ in ~~September~~tax ~~2026.~~legislation ~~Labor~~or ~~disruptions~~tax ~~encountered~~rates, byincluding ~~our~~changes ~~customers~~in ~~during~~ the ~~contract~~interpretation ~~period~~or ~~could~~enforcement ~~have~~of anexisting ~~adverse~~tax ~~effect~~laws, oncould ~~our~~adversely ~~business~~affect ~~and~~ our financial condition and results of operations.

~~Climate~~Warranty Change and Environmental, Social, and Governance (ESG) Matters - Natural disasters or extreme weather conditions resulting from global climate change could lead us, our customers or our suppliers to experience disruptions in operations or disruptions in the availability of key components, which could lead to a material adverse impact on our results of operations, financial condition and cash flows. Further, various stakeholders, including customers, suppliers, lenders, regulators and those in the workforce, are increasing their expectations of companies to do their part to combat global climate change and its impact, and to conduct their operations in an environmentally sustainable manner with appropriate oversight by senior leadership. A failure to respond to the expectations and initiatives of our stakeholders could result in damage to our reputation and relationships with various stakeholders. We could also experience adverse impacts to our financial condition due to volatility in the cost or availability of capital, difficultly obtaining new business or entering into new supplier relationships, a possible loss of market share on our current product portfolio, fines and penalties or difficulty attracting and retaining a skilled workforce.Claims

We Inare ~~addition~~exposed to warranty claims in the ~~increased~~event ~~stakeholder~~that ~~focus~~our onproducts ~~climate~~fail ~~change,~~to ~~customer,~~perform ~~investor~~as expected, and ~~employee~~we ~~expectations~~may be required to participate in ~~ESG~~the ~~have~~repair ~~been~~costs ~~rapidly~~incurred ~~evolving~~by ~~and~~our ~~increasing~~customers for such products. ~~The~~We ~~enhanced~~are ~~stakeholder~~engaged ~~focus~~in onongoing ~~ESG~~discussions ~~requires~~with ~~the~~our ~~continuous~~customers ~~monitoring~~regarding ofwarranty ~~various~~information and ~~evolving~~potential ~~regulations~~claims. ~~and~~The ~~standards~~results ~~and~~of ~~their~~these ~~associated~~discussions ~~requirements~~could result in additional warranty costs in future periods. ~~Our~~Depending ~~failure,~~on orthe ~~that~~nature of ~~our~~and ~~supply~~the ~~base~~volume of vehicles involved in the potential warranty claims, these costs could be material to ~~adequately~~our ~~meet~~financial ~~stakeholder~~statements. ~~expectations~~As ~~may~~additional ~~result~~information inbecomes available, ~~among~~actual ~~other~~warranty ~~things,~~results ~~the~~may ~~loss~~differ offrom ~~business,~~recorded ~~diluted~~reserves ~~market~~or ~~valuation,~~we anmay ~~inability~~need to ~~attract~~record additional warranty provisions. If our customers demand higher warranty-related cost recoveries, or anif ~~inability~~our toproducts ~~attract~~fail ~~and~~to ~~retain~~perform ~~top~~as ~~talent~~expected, ~~that~~it could ~~adversely~~have ~~affect~~a ~~our~~material ~~business,~~adverse ~~financial~~impact ~~condition~~on orour results of operations, financial condition and cash flows.

~~FINANCIAL~~Other ~~RISKS~~Legal Proceedings

~~Financial~~We ~~Distress~~are ofinvolved ~~Automotive~~in ~~Supply~~various ~~Base~~legal ~~– During the Great Recession, which impacted calendar years 2009~~ and ~~2010,~~regulatory ~~deteriorating~~proceedings ~~automotive industry conditions adversely affected STRATTEC~~ and ~~our~~claims ~~supply base. Lower production levels at our major customers~~that, ~~volatility~~from intime ~~certain~~to ~~raw material and energy costs and the global credit market crisis resulted in severe financial distress among many companies within the automotive supply base. During the above~~ time ~~frame~~, ~~several~~may ~~automotive~~be ~~suppliers filed for bankruptcy protection or ceased operations~~significant. These ~~The~~are ~~potential~~typically ~~continuation~~claims orthat ~~renewal~~arise ofin ~~financial distress within~~ the ~~supply~~normal ~~base~~course ~~(whether~~of ~~from~~business, ~~infectious disease~~including, ~~the~~without ~~Ukraine conflict~~limitation, ~~the~~commercial ~~ongoing supply chain and logistics disruptions~~ or ~~otherwise)~~contractual ~~and our suppliers’ inability to obtain credit from lending institutions could lead to commercial~~ disputes ~~and possible supply chain interruptions. In addition~~, ~~the potential for future adverse industry conditions (~~including ~~from~~disputes ~~infectious~~with ~~disease~~our customers, ~~the~~suppliers ~~Ukraine conflict~~ or ~~otherwise)~~competitors, ~~may~~intellectual ~~require~~property usmatters, topersonal ~~provide~~injury ~~financial~~claims, ~~assistance~~environmental ormatters, ~~other~~tax ~~measures~~matters, toemployment ~~ensure~~matters ~~uninterrupted~~and ~~production~~antitrust matters. ~~The~~No ~~continuation~~assurances orcan ~~renewal~~be ofgiven ~~these~~that ~~industry~~such ~~conditions~~proceedings ~~could~~and ~~have~~claims awill ~~material~~not ~~adverse~~adversely ~~effect~~affect on our ~~existing~~financial ~~and future revenues~~condition, ~~financial~~operating results, ~~financial condition~~ and cash flows.

~~Cost~~Other Reduction – There is continuing pressure from our major customers to reduce the prices we charge for our products. This requires us to generate cost reductions, including reductions in the cost of components purchased from outside suppliers. If we are unable to generate sufficient production cost savings in the future to offset pre-programmed price reductions or additional price reduction demands, our gross margin and profitability will be adversely affected.Risks

~~Currency Exchange Rate Fluctuations – Our sales are denominated in U.S. dollars. We have manufacturing operations in Mexico~~Pandemics, ~~and~~Epidemics as a result, a portion of our manufacturing costs are incurred in Mexican pesos. Therefore, fluctuations in the U.S. dollar/Mexican peso exchange rate may have a material effect on our profitability, cash flows, financial position, and ~~may~~Infectious ~~significantly~~Disease affect the comparability of our results between financial periods. Any depreciation in the value of the U.S. dollar in relation to the value of the Mexican peso will adversely affect the cost of our Mexican operations when translated into U.S. dollars. Similarly, any appreciation in the value of the U.S. dollar in relation to the value of the Mexican peso will decrease the cost of our Mexican operations when translated into U.S. dollars. Outbreaks

~~Inflationary~~Pandemics ~~Pressures~~or –disease Weoutbreaks have disrupted, and may continue to ~~experience~~disrupt, ~~elevated~~the ~~inflation~~global economy. Because we and our suppliers manufacture products in facilities around the ~~markets~~world, we may be vulnerable to an outbreak of infectious disease in the regions in which we ~~operate~~, ~~with~~or ~~higher~~our ~~commodity,~~customers ~~labor~~or suppliers, ~~freight~~operate. The effects of infectious disease outbreaks have included and ~~other~~may ~~cost~~continue ~~pressure.~~to ~~While~~include ~~many~~disruptions ~~costs~~or ~~will~~restrictions ~~moderate~~on ~~over~~our ~~time~~ability to travel, ~~the~~our ~~increases~~ability into ~~wage~~manufacture ~~levels~~our ~~are~~affected ~~likely~~products and our ability to ~~have~~ship ~~longer-term~~these ~~effects~~affected onproducts ~~our~~to ~~cost~~customers ~~structure.~~as ~~Additionally,~~well weas disruptions that have and may continue to ~~experience~~affect ~~price~~our ~~increases~~key ~~from~~customers ~~our~~and suppliers, including those in ~~connection~~these ~~with~~regions or other affected regions of the ~~inflationary~~world, ~~pressures~~including ~~they~~in ~~face~~the United States, Mexico, China and neighboring countries. ~~The~~Current ~~inability~~and future disruption of our ability to ~~offset~~manufacture ~~inflationary~~or ~~price~~distribute ~~increases~~our ~~through~~products ~~price~~or ~~increases~~of ~~from~~the ability of our customers, ~~modifications~~ to take orders of our products, ~~continuous~~or ~~improvement~~our ~~actions~~suppliers orto ~~otherwise~~deliver ~~may~~key raw materials on a timely basis could have a material adverse effect on our ~~financial~~sales levels, pricing for raw materials and components and our operating results. In addition, future outbreaks of contagious diseases in the human population could result in a widespread health crisis that adversely affects the economies and financial ~~condition~~markets of many countries (including those where we operate or where our products are ultimately used), resulting in an economic downturn that could affect demand for our products and impact our operating results.

~~Interest~~Geopolitical Rates – Higher interest rates could have a dampening effect on overall economic activity, the financial condition of our customers and suppliers and the financial condition of end consumers who ultimately create demand for the products we supply, all of which could negatively affect demand for our products.Instability

We are currently operating in a period of geopolitical instability, which has significantly contributed to economic uncertainty, capital market disruption and supply chain interruptions in the U.S. and global markets. While the length and impact of the ongoing global conflicts are unpredictable, they could lead to further market disruptions, including supply chain interruptions and significant volatility in commodity prices, and in credit and capital markets. The ongoing conflicts have led to sanctions and other penalties being levied by the U.S., the EU, and other countries. Additional potential sanctions and penalties have also been proposed. These global conflicts, as well as future geopolitical conflicts, could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets, potentially further disrupting the supply chain for necessary components and raw materials used by us or our customers in producing product. Any of the foregoing factors could have a material adverse effect on our business, operating results, financial condition and cash flows.

Program Volume and Pricing Fluctuations – We incur costs and make capital expenditures for new program awards based upon certain estimates of production volumes over the anticipated program life for certain vehicles. While we attempt to establish the price of our products for variances in production volumes, if the actual production of certain vehicle models is significantly less than planned, our net sales and net income may be adversely affected. We cannot predict our customers’ demands for the products we supply either in the aggregate or for particular reporting periods.

Investments in Customer Program Specific Assets – We make investments in machinery and equipment used exclusively to manufacture products for specific customer programs. This machinery and equipment is capitalized and depreciated over the expected useful life of each respective asset. Therefore, the loss of any one of our major customers, the loss of specific vehicle models or the early cancellation of a vehicle model could result in impairment in the value of these assets which may have a material adverse effect on our financial results and financial condition.

Credit Facilities – Historically, from time to time we have relied on our existing credit facilities to provide us with adequate working capital to operate our business and fund our capital expenditures, including our expansion initiatives. Escalation of any global inflationary pressures on our operating results may impact our ability to satisfy our lending covenants in the short term. Additionally, we cannot provide assurance that we will be able to refinance, extend the maturity of, or otherwise amend the terms of our existing credit facilities, or that any refinancing, extension, or amendment will be on terms favorable to us or even on commercially reasonable terms. If our lenders reduce or terminate our access to amounts under our credit facilities, we may not have sufficient capital to fund our working capital needs and/or we may need to secure additional capital or financing to fund our working capital requirements or to repay outstanding debt under our credit facilities. Moreover, new credit facilities resulting from any refinancing of our existing facilities could have a significantly higher rate of interest and greater borrowing costs than our existing facilities. We can make no assurance that we will be successful in ensuring our availability of amounts under our credit facilities or in connection with raising additional capital and that any amount, if raised, will be sufficient to meet our cash flow requirements. If we are not able to maintain our borrowing availability under our credit facilities and/or raise additional capital when needed, we may be forced to sharply curtail our efforts to manufacture and promote the sale of our products or to curtail our operations.

There can be no assurance that the financial terms or covenants of any new credit facility will be the same or as favorable as those under our existing facilities. Additionally, our ability to complete a refinancing of our existing credit facilities prior to their respective maturities is subject to a number of conditions beyond our control. For example, if a disruption in the financial markets were to occur at the time that we intended to refinance our credit facilities, we might be restricted in our ability to access the credit lines. The restrictive covenants in any such new credit facility may limit our ability to engage in acts that may be in our best long term interests. A breach of any of these types of restrictive covenants in our credit facilities could result in a default under these facilities. If a default occurs, the lenders under our credit facilities may elect to declare all outstanding borrowings, together with accrued interest, to be immediately due and payable, to terminate any commitments they have to provide further borrowings and to exercise any other rights they have under the facilities or applicable law.

Warranty Claims – We are exposed to warranty claims in the event that our products fail to perform as expected, and we may be required to participate in the repair costs incurred by our customers for such products. We are engaged in ongoing discussions with our customers regarding warranty information and potential claims. The results of these discussions could result in additional warranty charges/claims in future periods. Depending on the nature of and the volume of vehicles involved in the potential warranty claims, these charges could be material to our financial statements. Prior to fiscal 2010, we had experienced relatively low warranty charges from our customers due to our commercial arrangements and improvements in the quality, reliability and durability of our products. Due to our largest customers’ extension and/or expansion of their warranty protection programs and demands for higher warranty cost sharing arrangements from their suppliers in their terms and conditions of purchase, including from STRATTEC, we increased our provision to cover warranty exposures since fiscal year 2010. In 2015, 2018, and 2023, our increased warranty provision was the result of various known or expected customer warranty issues outstanding and estimated future warranty costs to be incurred as of June 2015, June 2018, and June 2023, respectively, for which amounts were reasonably estimable. As additional information becomes available, actual results may differ from recorded estimates or we may need to record additional warranty provisions. Although we have product recall insurance in place, if our customers demand higher warranty-related cost recoveries, or if our products fail to perform as expected, it could have a material adverse impact on our results of operations, financial condition and cash flows.

LEGAL AND REGULATORY RISKS

Environmental, Safety and Other Regulations – We are subject to federal, state, local and foreign laws and other legal requirements related to the generation, storage, transport, treatment and disposal of materials as a result of our manufacturing and assembly operations. These laws include, among others, the Resource Conservation and Recovery Act (as amended), the Clean Air Act (as amended) and the Comprehensive Environmental Response, Compensation and Liability Act (as amended). We have an environmental management system that is ISO-14001 certified. We believe that our existing environmental management system is adequate for current and anticipated operations and we have no current plans for substantial capital expenditures in the environmental

area. An environmental reserve was established in 1995 for estimated costs to remediate a site at our Milwaukee facility. The site was contaminated from a former above-ground solvent storage tank, located on the east side of the facility. The contamination occurred in 1985 and is being monitored in accordance with federal, state and local requirements. We do not currently anticipate any material adverse impact on our results of operations, financial condition or competitive position as a result of compliance with federal, state, local and foreign environmental laws or other related legal requirements. However, risk of environmental liability and changes associated with maintaining compliance with environmental laws is inherent in the nature of our business and there is no assurance that material liabilities or changes could not arise.

Compliance Related to Conflict Minerals Regulations – We are required to disclose the use of tin, tantalum, tungsten and gold (collectively, “conflict minerals”) mined from the Democratic Republic of the Congo and adjoining countries (the “covered countries”) if a conflict mineral(s) is necessary to the functionality of a product manufactured, or contracted to be manufactured, by us. We may determine, as part of our compliance efforts, that certain products or components we obtain from our suppliers could contain conflict minerals. If we are unable to conclude that all our products are free from conflict minerals originating from covered countries, this could have a negative impact on both our existing and future business, reputation and/or results of operations. We may also encounter challenges to satisfy customers who require that our products be certified as conflict free, which could place us at a competitive disadvantage if we are unable to substantiate such a claim. Compliance with these rules could also affect the sourcing and availability of some of the minerals used in the manufacture of products or components we obtain from our suppliers, including our ability to obtain products or components in sufficient quantities and/or at competitive prices to sell to our customers.

Income Taxes – We are a U.S.-based multinational company subject to tax in multiple U.S. and foreign tax jurisdictions. Significant judgment is required in determining our global provision for income taxes, deferred tax assets or liabilities and in evaluating our tax positions on a worldwide basis. While we believe our tax positions are consistent with the tax laws in the jurisdictions in which we conduct our business, it is possible that these positions may be overturned by jurisdictional tax authorities, which may have a significant impact on our global provision for income taxes. Tax laws are dynamic and subject to change as new laws are passed and new interpretations of these laws are issued or applied. We are also subject to ongoing tax audits. These audits can involve complex issues, which may require an extended period of time to resolve and can be highly subjective. Tax authorities may disagree with certain tax reporting positions taken by us and, as a result, assess additional taxes against us. We regularly assess the likely outcomes of these audits in order to determine the appropriateness of our tax provision.

RISK RELATED TO INFECTIOUS DISEASE OUTBREAKS, SUCH AS COVID-19

Pandemics or disease outbreaks, such as COVID-19, have disrupted, and may continue to disrupt, the global economy. For example, the Coronavirus (COVID-19) pandemic adversely affected our operations and supply chains, in particular related to the sourcing of semiconductor chips, which caused us to experience reductions in demand for certain of our products and services as a result of the pandemic and this supply chain disruption. Because we and our suppliers manufacture products in facilities around the world, we have been and may continue to be vulnerable to an outbreak of COVID-19 (or the resurgence of such an outbreak) or other contagious diseases in those regions as well as in the United States. The effects of COVID-19 and other contagious diseases have included and may continue to include disruptions or restrictions on our ability to travel, our ability to manufacture our affected products and our ability to ship these affected products to customers as well as disruptions that have and may continue to affect our key customers and suppliers, including those in these regions or other affected regions of the world, including in the United States, Mexico, China and neighboring countries. Current and future disruption of our ability to manufacture or distribute our products or of the ability of our customers to take orders of our products or our suppliers to deliver key raw materials on a timely basis could have a material adverse effect on our sales levels, pricing for raw materials and components and our operating results. In addition, the worsening of COVID-19 and future outbreaks of contagious diseases in the human population could result in a widespread health crisis that adversely affects the economies and financial markets of many countries (including those where we operate or where our products are ultimately used), resulting in an economic downturn that could affect demand for our products and impact our operating results.

RISK RELATED TO GEOPOLITICAL INSTABILITY

We are currently operating in a period of geopolitical instability resulting from the ongoing military conflict between Russia and the Ukraine, which has significantly contributed to economic uncertainty, capital market disruption and supply chain interruptions in the U.S. and global markets. On February 24, 2022, a full-scale military invasion of the Ukraine by Russian troops began. While the length and impact of the ongoing conflict is unpredictable, the Ukraine conflict could lead to market disruptions, including supply chain interruptions and significant volatility in commodity prices, and in credit and capital markets. The conflict in the Ukraine has led to sanctions and other penalties being levied against Russia by the U.S., the EU, and other countries. Additional potential sanctions and penalties have also been proposed. Russian military actions and the resulting sanctions, as well as future geopolitical conflicts, could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets, potentially further disrupting the supply chain for necessary components and raw materials used by us or our customers in producing

product. Any of the foregoing factors could have a material adverse effect on our business, operating results, financial condition and cash flows.

GENERAL RISK FACTOR

In addition to the specific risks above, we, our customers, and our suppliers may be adversely affected by changing economic conditions throughout the world. These conditions may result in reduced consumer and investor confidence, instability in the credit and financial markets, volatile corporate profits, and reduced business and consumer spending. We, our customers, and our suppliers and the economy as a whole also may be affected by future world or local events outside of our control, such as tariffs and other trade protection measures put in place by the United States or other countries, acts of terrorism, developments in the war on terrorism, civil unrest, conflicts in international situations, weather events, natural disasters, outbreaks of infectious diseases, such as the COVID-19 pandemic, and government or political related developments or issues, including changes in tax laws and regulations. These factors could have a material adverse impact on our results of operations, financial condition, and cash flows. Additionally, political and social turmoil, international conflicts (such as the Ukraine conflict) and terrorist acts may put pressure on global economic conditions that may adversely impact our operating results. Unstable political, social or economic conditions may make it difficult for us, our customers and our suppliers to accurately forecast and plan future business activities. If such conditions arise or persist, they could have a material adverse impact on our results of operations, financial condition and cash flows.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 1C. CYBERSECURITY

We take cybersecurity threats seriously, including regular assessment of cybersecurity risks both internally and with third party assistance and updates to the Board of Directors at least annually. We use the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF) as the basis for the information security management system. As we implement new technologies, the NIST CSF is used as the guiding framework. Among other best practices, we use multi-factor authentication wherever possible for external access to systems, assess and update current versions of security solutions, perform regular cybersecurity training and email phishing campaigns for employees, use third parties to perform external penetration testing, and maintain disaster recovery and incident response plans, which include retainer contracts for third party cybersecurity response specialists. We employ a combination of methods to monitor for new or developing cybersecurity risks.Governance

The ~~Board~~Company ~~regularly~~conducts ~~receives~~regular ~~reports~~assessments ~~and~~of ~~training~~cybersecurity ~~from~~risks ~~management~~both internally and with third ~~parties~~party onassistance ~~cybersecurity~~Information ~~matters.~~Technology ~~Management~~Director isreports ~~responsible~~on ~~for~~the ~~developing~~results ~~cybersecurity~~of ~~programs,~~these asassessments ~~may~~and becorresponding ~~required~~recommendations byto ~~applicable~~the ~~law~~full orBoard ~~regulation.~~of ~~Our~~Directors ~~cybersecurity~~at ~~personnel~~least ~~have~~annually. We use the ~~appropriate~~National ~~expertise~~Institute inof ITStandards and ~~cybersecurity,~~Technology ~~which~~("NIST") ~~generally~~framework ~~has~~to ~~been~~regularly ~~gained~~assess ~~from~~the threat landscape and support a ~~combination~~cybersecurity ofstrategy ~~education,~~based ~~including~~on ~~relevant~~prevention, ~~degrees~~detection and~~/or~~ ~~certifications~~mitigation. In general, ~~and~~the ~~prior~~Company ~~work~~seeks ~~experience.~~to ~~Our~~address cybersecurity ~~personnel,~~risks ~~along~~through ~~with~~a ~~third~~cross-functional ~~parties,~~approach ~~monitor~~that ~~the~~is ~~prevention,~~focused ~~detection,~~on ~~mitigation~~preserving confidentiality, ~~and~~managing ~~remediation~~data ofsecurity ~~cybersecurity~~and ~~incidents~~availability asand ~~part~~effectively ofresponding ~~the~~to cybersecurity ~~programs~~incidents ~~described~~when ~~above~~they occur. ~~Incidents,~~Management's ifphilosophy ~~any,~~on ~~are~~cybersecurity ~~escalated~~is to ~~management~~be ~~and~~vigilant in protecting the ~~Board~~Company ~~according~~through investments in tools and employee awareness to ~~our~~aid ~~incident~~in ~~response~~the ~~policy.~~prevention, ~~There~~detection ~~have~~and ~~been~~mitigation noof ~~material~~cyber ~~cybersecurity~~threats, ~~incidents~~while inrecognizing ~~the~~that ~~periods~~not ~~presented.~~all threats are preventable.

The Company's Information Technology Director and Chief Financial Officer, along with cybersecurity personnel on their respective teams, are responsible for developing cybersecurity programs, as may be required by applicable law or regulation. Our cybersecurity personnel have the appropriate expertise in IT and cybersecurity, which generally has been gained from a combination of education, including relevant degrees and/or certifications, and prior work experience.

Risk Management and Strategy

Among other best practices, we use multi-factor authentication wherever possible for external access to systems, assess and update current versions of security solutions, perform annual cybersecurity training and email phishing campaigns for employees, use third parties to perform external penetration testing, and maintain disaster recovery and incident response plans. We employ a combination of methods to monitor for new or developing cybersecurity risks. Incidents, if any, are escalated to management and the Board according to our incident response policy. Through these processes, we did not identify risks from current or past cybersecurity incidents that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents.

ITEM 2. PROPERTIES

We have five manufacturing plants, one warehouse, and ~~one~~two sales ~~office~~offices. We believe these facilities are well maintained and in good operating condition and are sufficient to meet our current needs. These facilities are described as follows:

Location	Type	Sq. Ft.		Owned orLeased
Milwaukee, Wisconsin	~~Headquarters~~Corporate headquarters and ~~General Offices; Component PartsManufacturing~~manufacturing		345,123	Owned
Juarez, Chihuahua Mexico	~~Subsidiary Offices and Assembly~~Manufacturing		169,926	Owned
Juarez, Chihuahua Mexico	~~Subsidiary Offices and Assembly~~Manufacturing		77,527	Owned
Juarez, Chihuahua Mexico	~~Subsidiary Offices, Key Finishing, Injection Moldingand Assembly Operations~~Manufacturing		114,841	Owned
Leon, Mexico	~~Subsidiary Offices, Door Handle Injecting Molding,Painting and Assembly~~Manufacturing		130,532	Owned
El Paso, Texas	~~Finished Goods and Service Parts~~ Distribution ~~Warehouse~~warehouse		114,715	Leased	**
Auburn Hills, Michigan	Sales and ~~Engineering Office for Detroit Customer Area~~engineering		62,736	Owned
Seoul, South Korea	Sales and engineering		2,859	Leased	**

** Leased unit within a complex.

ITEM 3. LEGAL PROCEEDINGS

In the normal course of business we may be involved in various legal proceedings ~~from time to time~~. We do not believe we are currently involved in any claim, action or proceeding of which the ultimate disposition ~~of which~~ would have a material adverse effect on our financial ~~statements~~condition, results of operations or cash flows.

ITEM 4. MINE SAFETY DISCLOSURES

~~None~~Not applicable.

1715

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock is traded on the NASDAQ Global Market under the symbol “STRT.”

Registered shareholders of record at June 3029, ~~2024~~2025, were ~~800~~756. The number of stockholders of record is based upon the actual number of holders registered on this date and does not include holders of common stock in “street name” by brokers or other entities on behalf of stockholders.

The Company’s Board of Directors authorized a stock repurchase program on October 16, 1996, and the program was publicly announced on October 17, 1996. Since inception of the stock repurchase program, the Board of Directors has periodically increased the number of shares authorized for repurchase under the program. At June 30, 2024, the number of shares of the Company’s common stock authorized for repurchase under the program totaled 3,839,395. The program currently authorizes the repurchase of the Company’s common stock from time to time, directly or through brokers or agents, and has no expiration date. Over the life of the repurchase program through June 30, 2024, a total of 3,655,322 shares have been repurchased at a cost of approximately $136.4 million. No shares were repurchased during the fiscal year ended June 30, 2024.

ITEM 6. [RESERVED]

1816

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management's Discussion and Analysis should be read in conjunction with ~~STRATTEC~~the ~~SECURITY~~accompanying ~~CORPORATION’s~~audited ~~accompanying~~consolidated ~~Financial~~financial ~~Statements~~statements and ~~Notes thereto included in this Form 10-K~~notes. ~~Unless otherwise indicated, all references to years or quarters refer to fiscal years or fiscal quarters of STRATTEC.~~

~~Executive~~Business Overview

~~Historically,~~Strattec ~~traditional~~Security ~~domestic~~Corporation ~~automotive~~is ~~OEMs~~a ~~(General~~leading ~~Motors,~~global ~~Ford~~manufacturer and ~~Stellantis)~~provider ~~have comprised a majority~~ of ~~our~~highly ~~total~~engineered ~~net~~advanced ~~sales.~~automotive ~~During~~access ~~the~~and ~~past~~security ~~two~~products ~~decades,~~and ~~these~~solutions. Products ~~customers~~include ~~have~~locks ~~lost~~& ~~North~~locksets, ~~American~~vehicle ~~market~~start ~~share~~systems, toengineered ~~New~~latches, ~~Domestic~~power ~~automotive~~access ~~manufacturers~~solutions, ~~(primarily~~door ~~Japanese and Korean automotive manufacturers). In addition~~handles, ~~our~~keys ~~financial~~& ~~performance~~fobs ~~depends~~and inother ~~large~~vehicle ~~part~~access onproducts. While ~~conditions in~~ the ~~North~~Company ~~American~~serves major automotive ~~industry,~~OEMs ~~which in turn~~globally, ~~are largely dependent upon~~ the ~~U.S.~~majority ~~economy.~~of ~~During~~sales ~~fiscal~~are ~~years~~to ~~2024 and 2023,~~ the ~~traditional~~three ~~domestic~~largest ~~automotive~~automobile ~~OEMs~~original ~~represented~~equipment 66manufacturers ~~percent~~in ofNorth ~~our total net sales~~America.

~~Fiscal~~Current ~~2024~~Business net sales were $537.8 million compared to $492.9 million in fiscal 2023. $32.7 million of the $44.9 million net sales increase was driven by net price increases to our major OEM customers. When excluding this pricing effect, underlying sales increased by $12.2 million, up 2.5% over the prior year, largely reflecting the launch of new customer programs in the latter half of the fiscal year. The $32.7 million of aforementioned net price increase was composed of $9.7 million one-time retroactive pricing that is not expected to recur, and $23.0 million in ongoing increases in current part prices to our customers. In addition, we settled negotiations with certain key suppliers and paid $5.7 million in higher prices during the year, of which $1.7 million relates to one-time retroactive pricing with the remaining $4.0 million attributable to higher supplier prices on an ongoing basis. The net margin result of both customer and supplier changes in price represented a $27.0 million net margin improvement in fiscal 2024, comprised of $8.0 million of nonrecurring one-time pricing and $19.0 million of ongoing pricing. These net margin improvements surpassed the higher end of our target ranges of $6.0 million and $15.0 million for one-time and ongoing net pricing respectively, which were provided in the fiscal 2024 Outlook in our 2023 Form 10-K. Update

~~During~~Our financial results for fiscal ~~2024,~~2025 ~~our~~represented ~~cost~~a ofsignificant improvement over prior year and included $565.1 million in sales ~~performance~~(+5.1% ~~proved~~increase ~~challenging~~year-over-year) and $18. ~~Despite~~7 ~~favorability~~million in ~~our~~net ~~raw~~income ~~materials~~attributable ~~costs,~~to ~~which~~Strattec ~~recovered~~(or ~~from~~$4.58 ~~elevated~~per ~~levels~~share incompared ~~fiscal~~to ~~2023,~~$4.07 ~~and~~per ~~improved~~share ~~efficiency~~in ofthe ~~our~~prior ~~Mexican~~year). Cash flow from operations ~~through~~also aincreased ~~salaried~~year-over-year ~~staff~~from ~~reduction~~$12.2 million in ~~the~~fiscal ~~first~~2024 ~~quarter~~to $71.7 million in fiscal 2025. As we look forward and ~~production~~navigate ~~efficiencies~~macroeconomic ~~implemented~~challenges ~~throughout~~and ~~the~~fluctuating ~~year~~OEM production volumes, our ~~overall~~operational ~~cost~~discipline, ofproduct ~~sales~~portfolio ~~performance~~refinement, ~~deteriorated.~~and ~~Factors~~cost ~~driving~~control ~~higher~~measures ~~costs~~position inus ~~our~~to ~~manufacturing~~continue ~~operations~~to ~~were~~drive ~~primarily:~~long-term shareholder value.

aMarket ~~weakened U.S. dollar against the Mexican peso, raising the cost of our Mexican operations~~Demand

~~higher~~Volatility ~~Mexican~~in the North American automotive industry is driven by supply chain disruptions, global inflation, thinning labor ~~wages~~availability, ~~due~~rising global commodity costs and a changing global trade and geopolitical climate. These macro conditions, coupled with changes in production volumes by OEMs in response to ~~government~~new vehicle consumer demand, impact our sales and profitability levels. We delivered 5% sales growth in fiscal 2025, the result of new program launches, pricing actions and increased volumes on the platforms we serve. However, based on recent third party industry projections, it is expected that North American light vehicle production will be flat over the next several years with fiscal 2026 OEM production levels forecasted to be down approximately 5-~~mandated~~6%, ~~minimum~~with ~~wage~~a ~~increases~~recovery in fiscal 2027 and 2028. Lower near term North American light vehicle production estimates, which are subject to change, are a result of recent tariff uncertainties and related demand impacts, coupled with a lower number of scheduled new platform launches by our addressable customers.

~~higher~~Trade ~~shipping~~Environment ~~costs~~& ~~primarily due to expedited shipments related to the launch of new product programs~~ Tariffs

~~Sales~~In the second half of fiscal 2025 the United States government announced broad tariffs on goods imported into the U.S. from numerous countries, ~~engineering~~with ~~and~~certain ~~administrative~~exemptions ~~expenses~~such ~~decreased~~as inUSMCA-compliant ~~fiscal~~imports. In ~~2024~~response, ~~primarily~~multiple ~~due~~nations tohave ~~historically~~countered ~~high~~with ~~engineering~~reciprocal ~~cost~~tariffs ~~reimbursements~~and ~~from~~other ~~our~~actions. Since ~~customers~~that time, ~~offset~~reciprocal bytariffs ~~expenses~~have ~~related~~continued to evolve and the ~~company~~fact ~~bonus~~pattern ~~plan~~remains uncertain. Like other automotive suppliers, we source raw materials and ~~the~~components ~~transition~~from a global supply chain with final assembly for our products completed in our Mexico operations. We ship approximately 65% of our ~~Chief~~sales ~~Executive~~(the ~~Officer~~majority ~~position~~of which are USMCA compliant) to customer production sites in the United States, with the balance shipped to other countries. ~~Our~~We ~~improved~~continue ~~operating~~to ~~performance~~monitor ~~enabled~~the usdynamic global trade environment and are taking actions to ~~achieve~~mitigate ~~net~~the ~~income~~cost ~~attributable~~impact of additional tariffs and understand any associated changes in customer demand and production build schedules. Prior to ~~STRATTEC~~mitigation efforts, we estimate that the annual impact of the recently enacted tariffs as of August 2025 is a $~~16.3~~5 -$7 million increase in ~~fiscal~~our ~~2024~~cost ~~compared~~of ~~with~~goods sold. We have already mitigated a ~~net~~majority ~~loss~~of ~~attributable~~the tocost ~~STRATTEC~~increase through changes in our global supply chain, pass through of ~~$6.7~~costs ~~million~~to customers and changes in ~~fiscal~~our ~~2023~~logistics processes. We will continue to pursue commercial recoveries in an effort to fully offset the cost increase.

~~Based on July 2024 projections from our third-party forecasting service, S&P~~ Global, North American light vehicle production is forecasted to grow modestly between 2024 and 2028. Model year 2024 preliminary North American vehicle build was 15.8 million. S&P Global currently expects 2025 model year vehicle build to remain at 15.8 million vehicles, growing to 16.2 million vehicles in 2026 and then to 16.4 million vehicles for 2027 and 2028. The North American vehicle build forecasts for our primary customers (Ford, General Motors and Stellantis) project a modest decline from 6.7 million vehicles in 2024 to 6.5 million vehicles in 2025 and then an increase to 6.9 million vehicles in model year 2026, stabilizing at that level for model years 2027 and 2028. In an effort to increase our sales, we will continue pursuing opportunities to expand our offerings with existing and new customers. These forecasts are subject to variability based upon a number of factors, including the overall North American economy, current employment levels, availability and cost of consumer credit, home equity values, fuel prices, changes in customer vehicle and option preferences, product quality issues, including those related to recall and product warranty coverage issues, and other key factors that we believe could determine whether consumers can or will purchase new vehicles or particular brands. Conditions

19Due to our operations in Mexico, our financial results are impacted by labor inflation, the result of government mandated minimum wages, and we have exposure to changes in foreign currency exchange rates. We strive to mitigate the impact of these cost increases through supply chain and manufacturing efficiencies, strategic pricing and peso forward contracts. During fiscal 2025 we have taken actions to improve our cost structure, including a restructuring of our Milwaukee and Mexico operations. The restructuring activities are expected to generate approximately $5 million of annual cost reductions.

~~Results~~Business ~~of Operations~~Transformation

~~2024~~Our ~~Compared~~strategic priority is to ~~2023~~execute on a business transformation to strengthen the Company’s profitability and deliver sustainable sales growth. We expect to improve our business with upgraded systems and processes, modernization of our support functions and a focus

	Years Ended
	June 30, 2024		July 2, 2023
Net Sales (millions of dollars)	$	537.8	$	492.9

~~Net~~on ~~Sales~~productivity toand ~~each~~efficiencies ofin our ~~customers~~manufacturing oroperations. ~~customer~~We ~~groups~~believe this will result in an optimized cost structure and consistent cash generation through improved working capital velocity and efficient asset utilization. In the short term, cash generated from our operations will be reinvested in our business to fund our transformational efforts and growth initiatives. To drive organic growth, we will leverage our technical engineering expertise, market-leading positions and strong customer relationships to generate innovative solutions and capture more content on current ~~year~~platforms, win new platforms with current customers, gain new customers both domestically and ~~prior~~abroad ~~year~~and ~~were~~build asopportunities ~~follows~~in ~~(millions~~the ofbroader ~~dollars):~~transportation industry.

	Years Ended
	June 30, 2024		July 2, 2023
General Motors Company	$	163.1	$	150.3
Ford Motor Company		114.9		96.6
Stellantis		77.7		78.1
Tier 1 Customers		77.5		73.3
Commercial and Other OEM Customers		58.9		56.3
Hyundai / Kia		45.7		38.3
Total	$	537.8	$	492.9

Analysis of Results of Operations

~~The~~Year ~~year-over-year~~ended ~~sales~~June ~~increase~~29, of2025 ~~$44.9~~(fiscal ~~million~~2025) ~~reflects~~compared ~~net~~with price increases from our major OEM customers of $32.7 million of which $23.0 million is attributable to ongoing increases in current part prices and $9.7 million relates to one-time retroactive price increases for parts shipped in the ~~prior~~ year ~~for~~ended ~~which~~June ~~the net price increase was agreed to during the current year. In addition to the net price increases~~30, ~~the~~2024 ~~following~~(fiscal ~~items specifically impacted sales to the noted customer groups between years:~~2024)

~~Sales~~The toCompany's ~~General~~consolidated ~~Motors~~results ~~Company~~of ~~were~~operations ~~favorably~~for ~~impacted~~the byyears ~~new~~ended ~~door~~June ~~handle~~29, ~~business~~2025 ~~supplied~~and onJune ~~the~~30, ~~Chevrolet~~2024 ~~Equinox~~were ~~EV.~~as follows:

Sales to Ford Motor Company were positively impacted by added power end gate content we supply on the F-Series Super Duty Pickup and by new tailgate latch content supplied on the F-Series Pickups.


	Years Ended						Change
	June 29, 2025			June 30, 2024			$			%
Net sales	$	565,066		$	537,766		$	27,300			5	%
Direct material costs		315,320			301,660			13,660			5	%
Labor and overhead costs		165,169			170,638			(5,469	)		(3	%)
Cost of goods sold		480,489			472,298			8,191			2	%
Gross profit		84,577			65,468			19,109			29	%
Gross margin		15.0	%		12.2	%					280	bp
Selling, administrative and engineering expenses		61,793			47,654			14,139			30	%
Income from operations		22,784			17,814			4,970			28	%
Operating margin		4.0	%		3.3	%					70	bp
Interest income		2,039			572			1,467			256	%
Interest expense		(1,007	)		(900	)		(107	)		12	%
Other income, net		820			2,717			(1,897	)		(70	%)
Income before income taxes and non-controlling interest		24,636			20,203			4,433			22	%
Income tax expense		5,717			3,775			1,942			51	%
Net income		18,919			16,428			2,491			15	%
Net income attributable to non-controlling interest		234			115			119			103	%
Net income attributable to Strattec		18,685			16,313			2,372			15	%

Earnings per share attributable to Strattec:
Basic	$	4.64		$	4.10		$	0.53			13	%
Diluted	$	4.58		$	4.07		$	0.51			12	%

~~Sales~~Net sales in fiscal 2025 totaled $565.1 million, representing an increase of $27.3 million, or 5%, compared to ~~Stellantis~~fiscal ~~were~~2024 ~~negatively~~net ~~impacted~~sales of $537.8 million. The year-over-year increase was driven by ~~reduced~~$15.9 ~~customer~~million ~~vehicle~~of ~~production~~net ~~volumes~~new program launches as well as ~~reduced~~favorable ~~content~~mix. weAdditionally, ~~supply~~higher ~~for~~production ~~the~~volumes ~~Dodge~~on ~~Ram~~existing ~~Pickup~~platforms and ~~several~~customer ~~passenger~~inventory ~~car~~builds ~~programs~~increased ~~ending~~sales by $13.9 million. Sales growth was broad based across most product categories. Sales volume increases more than offset a year-over-year reduction in pricing of $2.6 million. The reduction in pricing is a result of the prior year period including $9.7 million of one-time retroactive pricing recoveries, which was partially offset by current year margin accretive pricing.

~~Sales~~Material tocosts ~~Tier~~increased $13.7 million on higher production levels while labor and overhead costs declined $5.5 million. Reduced conversion costs reflect a $13.6 million benefit from changes in foreign currency exchange rates a $1.4 ~~Customers~~million ~~improved~~reduction in ~~the~~depreciation ~~current~~expense, ~~year~~$1.5 ~~compared~~million toof incremental tooling gains and a $1.4 million benefit from completed restructuring actions in the ~~prior~~second ~~year~~half of fiscal 2025. These benefits were partially offset by incremental conversion costs due to ~~new~~higher ~~door~~sales ~~hardware~~volumes, ~~content~~a on$6.2 ~~the~~million ~~F-Series~~increase ~~Super~~in ~~Duty~~Mexico ~~Pickup~~labor costs, ~~which~~$2.5 ismillion ~~sold~~of totariff acosts ~~Tier~~and additional provisions for annual bonus expense of $1.6 ~~customer~~million.

~~Sales~~Gross toprofit ~~Commercial~~was ~~and~~$84.5 ~~Other~~million ~~OEM~~in ~~Customers~~fiscal 2025, ~~which~~compared ~~are~~to ~~comprised~~$65.5 ofmillion ~~aftermarket~~in ~~products~~the ~~and~~comparable ~~vehicle~~prior ~~access~~year ~~control~~period. ~~products,~~Gross ~~such~~profit margin improved year-over-year from 12.2% to 15.0% as ~~latches,~~a ~~fobs,~~result ~~driver~~of ~~controls~~the ~~and~~strengthening ~~door~~of ~~handles~~the U.S. dollar, ~~were~~improved ~~positively~~leverage ~~impacted~~of byour fixed cost structure on higher sales ~~for~~volumes ~~new~~and ~~business~~the ~~awarded~~benefits ~~from~~of ~~Aston~~pricing ~~Martin~~and restructuring actions.

~~Sales~~Selling, toadministrative, ~~Hyundai~~and /engineering ~~Kia~~expenses increased $14.1 million year-over-year. The prior year included a one-time $4.8 million recovery of engineering, design and development costs. Increased costs in the current year were ~~positively~~the ~~impacted~~result byof ancontinued ~~overall~~investments in the business, a $5.2 million increase in ~~customer~~incremental ~~vehicle~~incentive ~~production~~compensation ~~volumes~~and ~~between years~~$1.0 million in business transformation

~~Cost of goods sold in the current year and prior year were as follows (millions of dollars):~~18

	Years Ended
	June 30, 2024					July 2, 2023
	Millions of Dollars		Percent of Net Sales			Millions of Dollars		Percent of Net Sales
Direct Material Costs	$	301.7		56.1	%	$	295.6		60.0	%
Labor and Overhead Costs		170.6		31.7	%		155.2		31.5	%
Total Cost of Goods Sold	$	472.3				$	450.8

related costs. Both fiscal years included non-recurring executive transition expenses related to leadership changes, totaling $2.1 million in fiscal 2025 and $1.1 million in fiscal 2024.

~~Prior~~Interest ~~year~~income ~~reclassifications~~increased ~~have~~$1.5 ~~been~~million ~~made~~due ~~for~~to ~~consistency~~increased ~~with~~levels ~~current~~of ~~year~~cash ~~presentation~~and cash equivalents, which are invested in overnight money market funds.

~~Total~~Other ~~cost~~income, ofnet ~~goods~~decreased ~~sold~~from ~~increased~~ $212.57 million ~~between years. The year-over-year increase~~ in ~~direct~~fiscal ~~material~~2024 ~~costs~~to of $60.18 million ~~was the result of increases~~ in ~~sales~~fiscal ~~volumes and content we supply~~2025, ~~as discussed above, and $5.7 million of negotiated material price increases paid to key suppliers. Price increases paid to suppliers attributed to ongoing operations totaled $4.0 million while~~ the ~~remaining~~result ~~$1.7 million related to one-time retroactive price increases. The impact~~ of ~~content~~changes ~~and material price increases was partially offset by reduced zinc costs of approximately $3.1 million~~ in ~~the~~foreign ~~current~~currency ~~year~~exchange asrates ~~compared~~and toincreased ~~the~~non-service ~~prior year. The year~~post-~~over-year~~employment ~~increase in labor and overhead~~ costs ~~of $15~~.~~4 million was impacted by the following:~~

~~Cost~~The ~~Increases:~~effective income tax rate was 23.2% and 18.7% for fiscal 2025 and 2024, respectively. The effective rate for both periods differs from the statutory rate because of the foreign rate differential, state income taxes, research and development tax credits, limitations on the utilization of foreign tax credits and non-deductible items. Additionally, the 2024 effective tax rate was favorably impacted by changes in the estimate of our 2023 foreign tax credits associated with the sale of our interest in a prior joint venture.

~~The~~Fiscal ~~U.S.~~2025 ~~dollar~~net ~~value~~income ofattributable ~~our~~to ~~Mexican~~Strattec ~~operations~~increased ~~was~~$2.4 ~~negatively~~million, ~~impacted~~or 15% from fiscal 2024, driven primarily by ~~approximately~~net ~~$8.5~~sales ~~million~~growth inand ~~the~~gross ~~current~~margin ~~year~~enhancement, aspartially ~~compared~~offset toby ~~the~~higher ~~prior~~selling, ~~year~~administrative and engineering expenses due to aninvestments ~~unfavorable~~in ~~Mexican~~the ~~peso~~business, toincentive ~~U.S.~~compensation ~~dollar~~costs ~~exchange~~and ~~rate~~prior ~~between~~year ~~years.~~favorable ~~The~~recoveries on engineering, design and development costs.

average U.S. dollar / Mexican peso exchange rate decreased to approximately 17.13 pesos to the dollar for the year from approximately 18.98 pesos to the dollar in the prior year.

Mexico wages and benefits increased $6.6 million in the current year as compared to the prior year as a result of annual wage increases, including January 1, 2024 and January 1, 2023 government mandated minimum wage increases.

Freight costs increased $4.1 million between years due to an increase in shipments from foreign vendors, a change in shipping terms with a major supplier that occurred in June 2023, and an increase in expedited shipments.

The current year includes expense provisions of $2.7 million under our incentive bonus plan. The prior year includes no bonus expense.

The current year includes severance costs of $220,000 related to a realignment of our Mexican workforce.

Cost Decreases:

Mexico wages and benefits decreased by $1.5 million due to a September 1, 2023 salaried staff reduction in Mexico and current year production efficiencies that controlled headcount and hours worked.

Royalty costs paid on sales of certain aftermarket products decreased $0.9 million in the year as compared to the prior year due to lower volumes in these aftermarket products.

The net unfavorable impact of specific labor and overhead costs noted above was partially offset by more favorable absorption of our fixed overhead costs in the current year as compared to the prior year due to higher production volumes driven by an increase in finished goods inventory during the year and increased sales volumes.

	Years Ended
	June 30, 2024			July 2, 2023
Gross Profit (millions of dollars)	$	65.5		$	42.2
Gross Profit as a percentage of net sales		12.2	%		8.6	%

Gross profit margin improvement between years was driven by pricing relief achieved during the current year as discussed above. The impact of one-time retroactive pricing in the current year increased the gross profit margin percentage by 1.3 percentage points. Additionally, favorable impacts of ongoing customer price increases, reduced zinc costs, favorable absorption, production efficiencies in Mexico and reduced royalty costs were partially offset by an unfavorable U.S. dollar to Mexican peso exchange rate, wage increases in Mexico, and increased freight, bonus, and severance costs, all as discussed above.

Engineering, Selling and Administrative Expenses in the current year and prior year were as follows:

	Years Ended
	June 30, 2024			July 2, 2023
Expenses (millions of dollars)	$	47.7		$	48.2
Expenses as a percentage of net sales		8.9	%		9.8	%

Engineering, selling and administrative expenses were impacted by the following:

Cost Decrease:

Current year costs decreased $3.2 million in comparison to the prior year due to an increase in customer billings for the reimbursement of engineering development costs.

Cost Increase:

The current year includes one-time charges of $1.0 million associated with the transition of our Chief Executive Officer position.

The current year includes expense provisions of $1.9 million under our incentive bonus plan. The prior year includes no bonus expense.

Income from operations in the current year was $17.8 million compared to loss from operations of $6.1 million in the prior year. This change between years was the result of an increase in sales in the current year as compared to the prior year along with a reduction in engineering, selling and administrative expenses partially offset by an increase in cost of goods sold, all as discussed above.

Effective June 30, 2023, STRATTEC sold its one-third interest in VAST LLC to WITTE. Refer to the discussion of the Equity Restructuring Agreement within Joint Ventures and Majority Owned Subsidiaries included in the Notes to Financial Statements within this Form 10-K for additional information regarding the sale. The equity loss of joint ventures was $331,000 in the current year compared to equity earnings of joint ventures of $1.6 million in the prior year. The current year loss was the result of additional professional fees incurred related to the sale of STRATTEC's investment in VAST LLC. The $331,000 loss is an adjustment to the gain on sale of VAST LLC, which was recorded in the prior year. Our adjusted loss to date on the sale of VAST LLC totals $221,000. Prior year equity earnings includes STRATTEC's one-third of a loss on disposal of VAST LLC's investment in Brazil of $531,000 and a gain on sale of STRATTEC's one-third share of VAST LLC of $110,000.

Included in other income (expense), net in the current year and prior year were the following items (thousands of dollars):

	Years Ended
	June 30, 2024			July 2, 2023
Foreign currency transaction gain (loss)	$	2,153		$	(2,935	)
Rabbi Trust Assets gain		211			202
Realized and unrealized gain on Mexican peso forward contracts, net		885			1,022
Pension and postretirement plans cost		(395	)		(722	)
Other		194			255
	$	3,048		$	(2,178	)

Foreign currency transaction gains and losses resulted from activity associated with foreign denominated assets and liabilities held by our Mexican subsidiaries.

The Rabbi Trust assets fund our amended and restated supplemental executive retirement plan. The investments held in the Trust are considered trading securities.

We entered into the Mexican peso currency forward contracts during fiscal 2024 and 2023 to reduce earnings volatility resulting from changes in exchange rates affecting the U.S. dollar cost of our Mexican operations. No peso forward currency contracts are outstanding as of June 30, 2024.

Pension and postretirement plan costs include net periodic benefit cost other than the service cost component.

Our effective income tax rate for 2024 was 18.7 percent compared to (16.7) percent in 2023. Our 2024 effective tax rate was reduced by $1.2 million due to changes in the estimate of our 2023 foreign tax credits associated with the sale of our interest in VAST LLC. Our 2023 effective tax rate was impacted by $2.2 million in China non-resident capital gain tax resulting from the sale of our interest in VAST LLC, a valuation allowance of $1.4 million related to our assessment of the future realization of capital loss carryforwards generated from the sale of our interest in VAST LLC, a net Global Intangible Low Tax Income (GILTI) cost of $613,000 and the impact of available R&D and foreign tax credits on pre-tax book losses. Our income tax provision for each year 2024 and 2023 was affected by the non-controlling interest portion of our pre-tax income and R&D tax credit. The non-controlling interest impacts the effective tax rate as our ADAC-STRATTEC LLC entity was taxed as a partnership for U.S. tax purposes in 2024 and our ADAC-STRATTEC LLC and STRATTEC POWER ACCESS LLC entities were taxed as partnerships for U.S. tax purposes in 2023.

Liquidity and Capital Resources

~~Working~~At ~~Capital~~June ~~(millions~~29, 2025, we had $84.6 million of ~~dollars~~cash and cash equivalents, of which $4.8 million was held by our foreign subsidiaries and $79.8 million was held domestically. Excess cash is held in money market funds. The following table summarizes our cash flows provided by (used in) operating, investing and financing activities (in millions):

	June 30, 2024			July 2, 2023
	Years Ended
Current Assets	$	253.8		$	225.8
	June 29, 2025			June 30, 2024
Current Liabilities		118.3			109.0
Cash flows from:
Working Capital	$	135.5		$	116.8
Operating activities	$	71.7		$	12.3
Investing activities		(7.2	)		(7.8	)
Financing activities		(4.9	)		—
Effect of exchange rate changes on cash		(0.4	)		0.3
Net increase in cash and cash equivalents	$	59.2		$	4.8

~~Outstanding~~Cash ~~Receivable~~flow ~~Balances~~from operations improved to $71.7 million, from ~~Major~~$12.3 ~~Customers~~million in the prior year. The increase in cash provided by operating activities was due to reduced purchasing levels on higher sales, collection of accounts receivable and the recovery of pre-production costs. Net cash used in investing activities was $7.2 million during fiscal 2025 compared to $7.8 million in the prior year period. Capital expenditures to support new product programs and the upgrade and replacement of existing equipment were $7.2 million in the current year period compared to $9.8 million in the prior year period. The prior year also included $2.0 million in proceeds received from the sale of our interest in a previous joint venture. Net cash used in financing activities resulted from the repayment of $5 million under our joint venture revolving credit agreement during fiscal 2025.

~~Our~~Primary ~~primary~~Working ~~source~~Capital of cash flow is from our major customers, which include Stellantis, General Motors Company and Ford Motor Company. As of the date of filing this Annual Report with the Securities and Exchange Commission, all of our customers are making payments on their outstanding accounts receivable in accordance with the payment terms included on their purchase orders. A summary of our outstanding receivable balances from our major customers as of June 30, 2024 and July 2, 2023 was as follows (millions of dollars):Management

	June 30, 2024		July 2, 2023
General Motors Company	$	28.6	$	27.5
Ford Motor Company		24.8		17.4
Stellantis		12.2		14.1
	$	65.6	$	59.0

We use primary working capital as a percentage of sales (PWC %) as a key metric of working capital management. We define this metric as the sum of net accounts receivable and net inventory less accounts payable, divided by the past three months sales annualized. The following table shows a comparison of primary working capital (dollars in millions):


	June 29, 2025			PWC %			June 30, 2024			PWC %
Accounts receivable, net	$	102			17	%	$	99			17	%
Inventory, net		65			11	%		82			14	%
Accounts payable		(66	)		(11	%)		(55	)		(10	%)
Net primary working capital	$	101			17	%	$	126			22	%

Cash ~~Balances~~Requirements inand ~~Mexico~~Contractual Obligations

We earn a portion of our operating income in Mexico. As of June 30, 2024, $1.4 million of our $25.4 million cash and cash equivalents balance was held in Mexico. These funds are available for repatriation as deemed necessary.

Cash Flow Analysis

	Years Ended
	June 30, 2024			July 2, 2023
Cash Flows from (millions of dollars):
Operating Activities	$	12.3		$	10.1
Investing Activities		(7.8	)		8.9
Financing Activities		—			(7.4	)
	$	4.5		$	11.6

Cash flow from operating activities increased $2.2 million between years as the impact of increased profitability between years, as previously discussed, was offset by a net increase in working capital. The net increase in our working capital included the following working capital changes (millions of dollars):

	Increase (Decrease) in Working Capital Requirements
	2024			2023			Change
Accounts Receivable	$	9.4		$	13.7		$	(4.3	)
Inventories		4.1			(2.9	)		7.0
Customer Tooling		1.4			10.0			(8.6	)
Other Assets		12.2			0.5			11.7
Accounts Payable and Other Liabilities		(10.7	)		(24.0	)		13.3
	$	16.4		$	(2.7	)	$	19.1

Accounts receivable balances increased in both the current and prior year periods. The increase in the accounts receivable balance during 2024 reflects increased sales as of the end of our fiscal 2024 as compared to the end of our fiscal 2023 as well as an increase of $6.4 million in open customer billings for the reimbursement of customer tooling costs and engineering development costs. The increase in accounts receivable balances during 2023 reflects increased sales as of the end of our fiscal 2023 as compared to the end of our fiscal 2022.

The change in inventory levels reflected an increase during the current year and a decrease during the prior year. The current year increase was driven by an increase in finished product inventory balances resulting from our long-term inventory reduction plan that looks to shift the composition of our inventory from purchased materials to finished production, improving responsiveness while reducing overall inventories. The prior year decrease was due to a reduction in inventory balances to align with historical customer production patterns, mostly offset by a change in inventory management and shipping terms with a significant vendor.

The change in customer tooling balances, which consisted of costs incurred for the development of tooling that will be directly reimbursed by the customer whose parts are produced from the tool, was the result of the timing of tooling development spending required to meet customer production requirements and related billings for customer reimbursements.

The current year increase in other assets is due to an $11.8 million increase in value added tax ("VAT") recoverable balances related to our Mexican operations. VAT recoverable balances increased due to a temporary issue with our Mexican tax certification. Although the certification issue was resolved during our December 2023 quarter, we were required to pay VAT on all parts temporarily imported into Mexico before seeking reimbursement for periods in which the certification issue was outstanding, which periods are now open to audit with the Mexican tax authority along with all periods subsequent to resolution of the certification issue. We believe temporary increases in the VAT recoverable balance will remain elevated until the periods under audit are closed.

Accounts payable balances increased in both the current and prior year periods. The current year increase was due to the following:

- Accrued salaries and benefits increased $6.3 million due to the accrual of $4.5 million under our incentive bonus plan as well as increased benefit accruals for our Mexican associates, which resulted from annual wage increases, including January 1, 2024 government mandated increases. There was no bonus accrual as of June 2023.

- VAT payable balances increased $3.5 million due to periods from 2024 being open to audit. Refer to the discussion of VAT recoverable balances and the VAT certification issue above.

- Income tax payable balances increased $2.5 million in 2024 based on the required income tax provision, the timing and amounts of federal, state and foreign tax payments made, and the timing of utilization of tax credits.

The prior year increase was due to the following:

- Accounts payable increased $14.0 million primarily due to a change in inventory management, shipping terms, and payment terms with a significant vendor and the temporary suspension of ADAC-STRATTEC LLC's payment of engineering, research and design fees and sales fees to ADAC in order to comply with ADAC-STRATTEC debt covenants.

- Accrued salaries and benefits increased $4.7 million due to increased salaries and benefits for our Mexican associates.

- Income taxes payable increased $2.4 million primarily due to the accrual of a China non-resident capital gain tax as a result of the sale of our interest in VAST LLC.

- Value added tax payable balances increased $3.0 million due to several periods being open to audit in Mexico.

Net cash used in investing activities of $7.8 million during 2024 included capital expenditures of $9.8 million in support of requirements for new product programs and the upgrade and replacement of existing equipment partially offset by additional proceeds from the sale of our interest in VAST LLC of $2.0. Net cash provided by investing activities of $8.9 million during 2023 included proceeds from the sale of our interest in VAST LLC of $26.2 million and a net increase in cash of $354,000 resulting from STRATTEC's purchase of the net assets of VAST Korea. The cash inflows were partially offset by capital expenditures of $17.4 million in support of requirements for new product programs and the upgrade and replacement of existing equipment and a $278,000 investment in VAST LLC for the purpose of funding general operating expenses for Sistema de Acesso Veicular Ltda, VAST LLC's Brazilian joint venture.

Net cash provided by financing activities of $72,000 during 2024 included additional borrowings under our credit facilities of $2.0 million and $72,000 received for purchases under our employee stock purchase plan. These cash inflows were partially offset by the repayment of borrowings under credit facilities of $2.0 million. Net cash used in financing activities of $7.4 million during 2023 included a payment of $9.0 million related to STRATTEC's purchase of the remaining non-controlling interest of STRATTEC POWER ACCESS LLC from WITTE Automotive, the repayment of borrowings under credit facilities of $15.0 million, and $600,000 of dividend payments to non-controlling interests in our subsidiaries. These cash outflows were partially offset by additional borrowings under our credit facilities of $17.0 million and $183,000 received for the exercise of stock options under our stock incentive plan and purchases under our employee stock purchase plan.

Cash Requirements

Dividends

On May 13, 2020, our Board of Directors took action to temporarily suspend payment of our quarterly dividend for the foreseeable future in order to conserve cash as a result of the economic downturn that began with COVID-19. No dividends were paid to shareholders during fiscal 2024 or fiscal 2023.

Future Capital Expenditures

We anticipate capital expenditures will be approximately $~~15.0~~13 million in fiscal ~~2025~~2026 in support of requirements for new product programs ~~and the upgrade and replacement of existing equipment.~~

and the upgrade and replacement of existing equipment.

Stock Repurchase Program

Our Board of Directors ~~has~~ authorized a stock repurchase program on October 16, 1996, to buy back outstanding shares of our common stock. Shares authorized for ~~buy~~buyback ~~back~~ under the program totaled 3,839,395 at June 3029, ~~2024~~2025. A total of 3,655,322 shares have been repurchased over the life of the program through June 3029, ~~2024~~2025, at a cost of approximately $136.4 million or an average price of $37.32 per share. Currently, 184,073 shares remain available to be repurchased under the program. No shares were repurchased during fiscal ~~2024~~2025 or ~~2023~~2024. Additional repurchases may occur from time to time and are expected to ~~continue to~~ be funded by cash flow from operations and current cash balances.

Other Cash Requirements

In connection with the June 30, 2023 sale of our interest in VAST LLC to WITTE Automotive, we will be required to pay nonresident capital gain tax in China. The payment, which is expected to be made during our fiscal 2025, is expected to total approximately $1.9 million.

We anticipate payments of approximately $4.5 million to associates in connection with our incentive bonus plan during the first quarter of our fiscal 2025 related to bonuses earned in our fiscal 2024.

We also have an operating lease for our El Paso, Texas finished goods and service parts distribution warehouse, which has a term in excess of one year. We also have purchase commitments related to zinc and other purchased parts. Refer to required future payments under the lease and purchase commitments in the discussion of Leases under Organization and Summary of Significant Accounting Policies and in the discussion of Commitments and Contingencies included in the Notes to Financial Statements included as part of Item 8 within this Form 10-K.

Credit Facilities

~~STRATTEC~~The Company has a $40 million secured revolving credit facility (the “~~STRATTEC~~Strattec Credit Facility”) with BMO Harris Bank N.A., ~~ADAC-STRATTEC~~while ~~LLC~~the joint venture has a $20 million secured revolving credit facility (the “ADAC-~~STRATTEC~~Strattec Credit Facility”) with BMO Harris Bank N.A., which is guaranteed by STRATTEC. The ADAC-STRATTEC Credit Facility borrowing limit decreases to $18 million on August 1, 2025. The credit facilities both expire August 1, 2026. Borrowings under either credit facility are secured by our U.S. cash balances, accounts receivable, inventory, and fixed assets located in the UCompany.S. ~~Interest~~Availability ~~on borrowings~~ under the STRATTEC Credit Facility were at varying rates based, at our option, on LIBOR plus 1.25 percent or the bank’s prime rate through February 22, 2023, SOFR plus 1.35 percent for the period February 23, 2023 through September 5, 2023, and SOFR plus 1.85 percent subsequent to September 5, 2023. Interest on borrowings under the ADAC-~~STRATTEC~~Strattec Credit Facility ~~were~~is atreduced ~~varying rates based, at our option, on the bank's prime rate with no interest rate margin through May 30, 2024 and a 2 percent interest rate margin subsequent~~ to May 30, 2024 or LIBOR plus 1.25 percent through February 6, 2023, SOFR plus 1.35 percent for the period February 7, 2023 through May 30, 2024, and SOFR plus 3.10 percent subsequent to May 30, 2024. Both credit facilities contain a restrictive financial covenant that requires the applicable borrower to maintain a minimum net worth level. The ADAC-STRATTEC Credit Facility includes an additional restrictive financial covenant that requires the maintenance of a minimum fixed charge coverage ratio. As of June 30, 2024, we were in compliance with all financial covenants required by these credit facilities. There were no outstanding borrowings under the STRATTEC Credit Facility as of June 30, 2024 or July 2, 2023. The average outstanding borrowings and weighted average interest rate on the STRATTEC Credit Facility loans were approximately $~~33,000~~18 ~~and 8.5 percent, respectively, during 2024. The average outstanding borrowings and weighted average interest rate on the STRATTEC Credit Facility loans were approximately $15.4~~ million and 5.7 percent, respectively, during 2023. Outstanding borrowings under the ADAC-STRATTEC Credit Facility totaled $13 million at both June 30, 2024 and July 2, 2023. The average outstanding borrowings and weighted average interest rate on ~~the~~August ~~ADAC-STRATTEC Credit Facility loans were approximately $13.0 million and 6.8 percent~~1, ~~respectively, during 2024~~2025. The average outstanding borrowings and weighted average interest rate on the ADAC-STRATTEC Credit Facility loans were approximately $12.4 million and 5.3 percent, respectively, during 2023. We believe that the credit facilities are adequate, along with existing cash flows from operations, to meet our anticipated capital expenditure, working capital, dividend, and operating expenditure requirements.

~~Joint~~There ~~Ventures~~were no outstanding borrowings and ~~Majority~~no ~~Owned~~interest ~~Subsidiaries~~due on the Strattec Credit Facility and $8 million drawn on the ADAC-Strattec Credit Facility as of June 29, 2025. Any balance drawn on these facilities and the related interest payment obligations are expected to be funded by cash flow from operations and current cash balances.

~~Refer~~Income to the discussion of Investment in Joint Ventures and Majority Owned Subsidiaries and discussion of Equity (Loss) Earnings of Joint Ventures included in the Notes to Financial Statements included within this Form 10-K. Taxes

~~Critical~~We ~~Accounting~~may ~~Policies~~be required to make cash outlays related to our unrecognized tax benefits, including interest and penalties. As of June 29, 2025, we had unrecognized tax benefits, including interest and penalties, of $1.9 million. However, due to the uncertainty of the timing of future cash flows associated with our unrecognized tax benefits, we are unable to make reasonably reliable estimates of the period of cash settlement, if any, with the respective taxing authorities. For further information related to our unrecognized tax benefits, see Note 6, "Income Taxes," for additional information.

WeOther ~~believe~~Cash ~~the following represents our critical accounting policies:~~Requirements

~~Liability for Uncertain Tax Positions –~~ We ~~are~~anticipate ~~subject~~payments toof ~~income taxation in many jurisdictions around the world~~$10.0 ~~Significant~~million ~~management judgment is required in the accounting for income tax contingencies because the outcomes are often difficult~~ to ~~determine.~~associates ~~We are required to measure and recognize uncertain tax positions that we have taken or expect to take~~ in ~~our~~connection income tax returns. The benefit of an uncertain tax position can only be recognized in the financial statements if management concludes that it is more likely than not that the position will be sustained with ~~the~~our ~~tax~~incentive ~~authorities.~~bonus ~~For~~plan aduring ~~position that is likely to be sustained,~~ the ~~benefit~~first ~~recognized~~quarter ~~in the financial statements is measured at the largest amount that is greater than 50 percent likely~~ of ~~being~~fiscal ~~realized.~~2026 Arelated ~~reserve~~to isbonuses ~~established~~earned ~~for the difference between a position taken~~ in anfiscal ~~income tax return and the amount recognized in the financial statements~~2025. The amount of unrecognized benefits, that if recognized, would affect the effective tax rate was $1.2 million at June 30, 2024 and $1.1 million at July 2, 2023. An increase or decrease in our assessment of the recorded amount of unrecognized benefits by

25We have an operating lease for our El Paso, Texas distribution warehouse, which has a term in excess of one year. Refer to required future payments under the lease in Note 5, "Leases".

10Critical ~~percent~~Accounting would result in an increase or decrease in the reported tax provision, before the impact of interest and penalties, of $120,000 at June 30, 2024 and $110,000 at July 2, 2023. Refer to the discussion of Income Taxes included in the Notes to Financial Statements included as part of Item 8 within this Form 10-K.Estimates

~~Warranty Reserve –~~ We ~~have~~prepare ~~a warranty reserve recorded related to~~ our ~~exposure~~consolidated tofinancial ~~warranty~~statements ~~claims~~ in ~~the~~conformity ~~event~~with ~~our products fail to perform as expected, and we may be required to participate in the repair costs incurred by our customers for such products~~U. ~~The recorded warranty reserve balance involves judgment and estimates~~S. ~~Our reserve estimate is based on an analysis of historical warranty data as well as current trends and information~~GAAP. ~~Actual~~This ~~warranty~~requires ~~costs~~management ~~might differ from estimates due~~ to ~~the~~make ~~level of actual claims varying from our claims experience and~~ estimates and ~~final~~assumptions ~~negotiations~~that ~~and~~affect ~~settlements~~reported ~~reached~~amounts ~~with~~and ~~our~~related ~~customers~~disclosures. ~~Therefore,~~Actual ~~future~~results ~~actual claims experience~~ could ~~result~~differ infrom ~~changes~~those ~~in our~~ estimates ~~of the required reserve~~. ~~Sensitivity~~The offollowing ~~potential~~estimates ~~warranty~~are orconsidered ~~product~~by ~~recall~~management ~~claims~~to isbe ~~dependent on~~ the ~~respective~~most ~~customer~~critical ~~platform,~~in ~~volumes,~~understanding ~~production~~judgments ~~years~~involved ~~and~~in ~~product content. We have product recall insurance once a recall claim exceeds $2.5 million with a limit of $30 million. Refer to~~ the ~~discussion~~preparation of ~~Warranty~~our ~~Reserve~~consolidated ~~under~~financial ~~Organization~~statements and ~~Summary~~uncertainties ofthat ~~Significant~~could ~~Accounting~~impact ~~Policies~~our ~~included~~results ~~in the Notes to Financial Statements included as part~~ of ~~Item~~operations, 8financial ~~within~~position ~~this~~and ~~Form~~cash ~~10-K~~flow.

WeRevenue ~~believe the reserve discussed above is estimated using consistent and appropriate methods. However, changes to the assumptions could materially affect the recorded reserve amount.~~Recognition

~~New~~We ~~Accounting~~enter ~~Standards~~into contracts with our customers generally at the beginning of a vehicle's lifecycle. Typically, these contracts do not provide for a specified quantity of products, but once entered into, we are often expected to fulfill our customers' purchasing requirements for the life of the vehicle. These contracts may be terminated by our customers at any time. Historically, terminations of these contracts have been infrequent.

~~Refer~~Throughout toa vehicle's lifecycle, we receive purchase orders from our customers, which provide the ~~discussion~~commercial ofterms ~~New~~for ~~Accounting~~a ~~Standards~~sale ~~under~~transaction. ~~Organization~~Revenue is typically recognized at a point in time based on the transaction price and ~~Summary~~the quantity of ~~Significant~~parts ~~Accounting~~shipped ~~Policies~~to ~~included~~the customer. Discrete price adjustments may occur during the vehicle production period in order for the ~~Notes~~Company to ~~Financial~~remain ~~Statements~~competitive ~~included~~with asmarket ~~part~~prices ofor ~~Item~~based 8on ~~within~~changes ~~this~~in ~~Form~~product ~~10-K~~specifications or based on changes in significant input costs for the products. In the event the Company concludes that a portion of the revenue for a given product may vary from the purchase order, the Company records

consideration at the most likely amount to which the Company expects to be entitled based on historical experience and input from customer negotiations.

Warranty

We have a warranty reserve recorded related to our exposure to warranty claims in the event our products fail to perform as expected, and we may be required to participate in the repair costs incurred by our customers for such products. The recorded warranty reserve balance involves judgment and estimates. Our reserve estimate is based on an analysis of historical warranty data as well as current trends and information. Actual warranty costs might differ from estimates due to the level of actual claims varying from our historical claims experience and estimates and final negotiations and settlements reached with our customers. Therefore, future actual claims experience could result in changes in our estimates of the required reserve. Sensitivity of potential warranty claims is dependent on the respective customer platform, volumes, production years and product content.

Income Tax

Judgment is required to determine the annual effective income tax rate, deferred tax assets and liabilities, reserves for unrecognized tax benefits and any valuation allowances recorded against net deferred tax assets. Our effective income tax rate is based on annual income, statutory tax rates, tax planning opportunities available in the various jurisdictions in which we operate and other adjustments. Tax regulations require items to be included in our tax returns at different times than these same items are reflected in our consolidated financial statements.

As a result, these differences and the interplay in tax laws between jurisdictions may cause the Company's estimates of income tax liabilities to differ from actual payments or assessments. Some of these differences are permanent, such as expenses that are not tax deductible, while others are temporary differences, such as amortization and depreciation expenses. Temporary differences create deferred tax assets and liabilities, which are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We establish valuation allowances for our deferred tax assets when the amount of expected future taxable income is not large enough to utilize the entire deduction or credit. Relevant factors in determining the realizability of deferred tax assets include future taxable income, the expected timing of the reversal of temporary differences, tax planning strategies and the expiration dates of the various tax attributes. At June 29, 2025 and June 30, 2024, the valuation allowance related to deferred tax assets was $3.9 million and $2.6 million, respectively.

While the Company has support for the positions it takes on tax returns, taxing authorities may assert different interpretations of laws and facts and may challenge cross-jurisdictional transactions. We assess our income tax positions and record tax liabilities for all years subject to examination based upon management’s evaluation of the facts and circumstances and information available at the reporting dates. For those tax positions which do not meet the more-likely-than-not threshold regarding the ultimate realization of the related tax benefit, no tax benefit has been recorded in the financial statements. As of June 29, 2025 and June 30, 2024, our liability for unrecognized tax benefits was $1.9 million and $1.6 million, respectively.

Post-employment Benefits

We have post-employment liabilities, including a supplemental executive retirement plan, termination indemnity plans and seniority premium obligations that are developed from actuarial valuations. These valuations include key assumptions regarding discount rates, expected return on plan assets and rate of compensation increases. We consider current market conditions in selecting these assumptions. While the Company believes that these assumptions are appropriate, significant differences in actual experience or significant changes in assumptions may materially affect the Company’s liability or future expense.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

2621

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	Page
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Deloitte & Touche LLP PCAOB No. 34)	28
CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)	30
CONSOLIDATED BALANCE SHEETS	31
Consolidated Statements of shareholders' Equity	32
Consolidated Statements of Cash Flows	33
Notes to Financial Statements	34

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of ~~STRATTEC~~Strattec ~~SECURITY~~Security ~~CORPORATION~~Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of ~~STRATTEC~~Strattec ~~SECURITY~~Security ~~CORPORATION~~Corporation and subsidiaries (the "Company") as of June 3029, ~~2024~~2025 and ~~July~~June 230, ~~2023~~2024, the related consolidated statements of income ~~(loss)~~ and comprehensive income ~~(loss)~~, shareholders’' equity, and cash flows, for the fiscal years ended June 3029, ~~2024~~2025 and ~~July~~June 230, ~~2023~~2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 3029, ~~2024~~2025 and ~~July~~June 230, ~~2023~~2024, and the results of its operations and its cash flows for the fiscal years ended June 3029, ~~2024~~2025 and ~~July~~June 230, ~~2023~~2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of June 3029, ~~2024~~2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated ~~September~~August 525, ~~2024~~2025, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Specific Warranty Reserve – Refer to ~~the~~Note ~~Warranty~~2 ~~Reserve Footnote~~ to the Financial Statements

Critical Audit ~~Metter~~Matter Description

The Company records a specific warranty reserve for known warranty claims when its products fail to perform as expected and when it is probable that they will participate in the repair costs incurred by its customers for such products.

The specific warranty reserve is estimated based on management’s analysis of historical warranty data, current trends and information, known and projected claims for products sold, and the terms of specific agreements. The specific warranty reserve requires management to apply significant judgment to develop its estimate. Actual warranty costs may differ from management’s estimated costs as a result of, but not limited to, negotiation with customers, changes to the assumptions of repair and/or replacement costs, and repair rate. Such matters may require future adjustments to the reserve which could be material.

We identified a certain specific warranty reserve as a critical audit matter because estimating future warranty costs requires significant judgment by management. Auditing management’s assumptions about management’s estimated future warranty costs involves a high degree of auditor judgment and an increased extent of effort to evaluate the reasonableness of management’s estimates.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the determination of the certain specific warranty reserve included the following, among others:

- We tested the effectiveness of internal controls relating to management’s process for developing the assumptions and inputs used to estimate the certain specific warranty reserve.

- We evaluated the methods and significant assumptions, including the frequency and average cost of warranty claims, used by management to estimate the certain specific warranty reserve by:

o Evaluating the methodology used to determine the certain specific warranty reserve in order to understand how key assumptions were developed.

o Testing the accuracy of the underlying data that served as the basis for the analysis, including the historical claims, potential disputes, and settlements paid on those claims.

o Testing the completeness of the certain specific warranty reserve by conducting ~~interviews~~inquiries of operational and executive management regarding knowledge of known product warranty claims or product issues and evaluating whether they were appropriately considered in the determination of the certain specific warranty reserve.

~~Comparing~~o ~~certain~~Testing ~~inputs used in~~ the ~~certain~~mathematical ~~specific~~accuracy ~~warranty reserve to industry data to assess the reasonableness~~ of management’s ~~assumptions~~calculation ~~used~~of in the ~~estimate.~~certain specific warranty reserve.

Developing an independent expectation of the Company’s certain specific warranty reserve and comparing it to management’s estimate to evaluate the reasonableness of the estimate.

/s/ Deloitte & Touche LLP

Milwaukee, Wisconsin

~~September~~August 525, ~~2024~~2025

We have served as the Company's auditor since 2023.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of Strattec Security Corporation

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Strattec Security Corporation and subsidiaries (the "Company") as of June 29, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of June 29, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended June 29, 2025 of the Company and our report dated August 25, 2025 expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Annual Report on Internal Controls over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Milwaukee, Wisconsin

August 25, 2025

STRATTEC SECURITY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)


	Years Ended
	June 29, 2025			June 30, 2024
Net sales	$	565,066		$	537,766
Cost of goods sold		480,489			472,298
Gross profit		84,577			65,468
Selling, administrative and engineering expenses		61,793			47,654
Income from operations		22,784			17,814
Interest income		2,039			572
Interest expense		(1,007	)		(900	)
Other income, net		820			2,717
Income before income taxes and non-controlling interest		24,636			20,203
Income tax expense		5,717			3,775
Net income		18,919			16,428
Net income attributable to non-controlling interest		234			115
Net income attributable to Strattec	$	18,685		$	16,313

Earnings per share attributable to Strattec
Basic	$	4.64		$	4.10
Diluted	$	4.58		$	4.07

The accompanying notes are an integral part of these Consolidated Financial Statements.

STRATTEC SECURITY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)


	Years Ended
	June 29, 2025			June 30, 2024
Net income	$	18,919		$	16,428

Other comprehensive (loss) income, net of tax:
Currency translation adjustments		(1,170	)		(2,794	)
Pension and postretirement plans		281			193
Total other comprehensive loss, net of tax		(889	)		(2,601	)
Comprehensive income		18,030			13,827
Comprehensive loss attributable to non-controlling interest		(231	)		(991	)
Comprehensive income attributable to Strattec	$	18,261		$	14,818

The accompanying notes are an integral part of these Consolidated Financial Statements.

STRATTEC SECURITY CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts and per share amounts)


	June 29, 2025			June 30, 2024
ASSETS
Current Assets:
Cash and cash equivalents	$	84,579		$	25,410
Receivables, net		102,061			99,297
Inventories:
Finished products		12,398			19,833
Work in process		11,303			15,461
Purchased materials		41,000			46,355
Inventories, net		64,701			81,649
Pre-production costs		8,657			22,173
Value added tax recoverable		19,389			19,684
Income tax recoverable		2,465			319
Other current assets		8,211			5,282
Total current assets		290,063			253,814
Noncurrent Assets:
Property, plant and equipment:
Land and improvements		6,582			6,697
Buildings and improvements		39,821			39,927
Machinery and equipment		236,545			258,622
Total property, plant and equipment		282,948			305,246
Less: accumulated depreciation		205,538			219,062
Property, plant and equipment, net		77,410			86,184
Deferred income taxes		19,531			17,593
Other noncurrent assets		4,450			6,698
Total Assets	$	391,454		$	364,289
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	65,824		$	54,911
Accrued payroll and benefits		22,956			28,953
Value added tax payable		11,933			9,970
Income tax payable		88			5,103
Warranty reserve		8,900			10,695
Other current liabilities		9,649			8,656
Total current liabilities		119,350			118,288
Noncurrent Liabilities:
Borrowings under credit facilities		8,000			13,000
Post-employment benefits		13,325			2,429
Other noncurrent liabilities		4,348			4,957
Total Liabilities	$	145,023		$	138,674
Shareholders' Equity:
Common stock, authorized 18,000,000 shares, $.01 par value, 7,635,883 issued shares at June 29, 2025 and 7,586,920 issued shares at June 30, 2024	$	76		$	76
Capital in excess of par value		103,784			101,024
Retained earnings		269,297			250,612
Accumulated other comprehensive loss		(16,113	)		(15,689	)
Less: treasury stock, at cost (3,596,549 shares at June 29, 2025 and 3,598,126 shares at June 30, 2024)		(135,452	)		(135,478	)
Total Strattec shareholders’ equity		221,592			200,545
Non-controlling interest		24,839			25,070
Total Shareholders' Equity		246,431			225,615
Total Liabilities and Shareholders' Equity	$	391,454		$	364,289

The accompanying notes are an integral part of these Consolidated Financial Statements.

STRATTEC SECURITY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(in thousands, except per share amounts)


	Common Stock		Capital in Excess of Par Value			Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock			Non-controlling interest			Total Shareholders' Equity
Balance -- July 2, 2023	$	75	$	100,309		$	234,299	$	(14,194	)	$	(135,526	)	$	26,061		$	211,024
Net income		—		—			16,313		—			—			115			16,428
Currency translation adjustments		—		—			—		(1,688	)		—			(1,106	)		(2,794	)
Pension and postretirement funded status adjustment, net of tax of $59		—		—			—		193			—			-			193
Purchase of former joint venture non-controlling interest		—		(775	)		—					—			-			(775	)
Stock-based compensation		—		1,467			—		—			—			-			1,467
Employee stock purchases		1		23			—		—			48			-			72
Balance -- June 30, 2024	$	76	$	101,024		$	250,612	$	(15,689	)	$	(135,478	)	$	25,070		$	225,615
Net income		—		—			18,685		—			—			234			18,919
Currency translation adjustments		—		—			—		(705	)		—			(465	)		(1,170	)
Pension and postretirement funded status adjustment, net of tax of $82		—		—			—		281			—			—			281
Stock-based compensation		—		2,725			—		—			—			—			2,725
Employee stock purchases		—		35			—		—			26			—			61
Balance -- June 29, 2025	$	76	$	103,784		$	269,297	$	(16,113	)	$	(135,452	)	$	24,839		$	246,431

The accompanying notes are an integral part of these Consolidated Financial Statements.

~~CONSOLIDATED~~STRATTEC ~~STATEMENTS~~SECURITY OFCORPORATION ~~INCOME (LOSS)~~ AND ~~COMPREHENSIVE INCOME (LOSS)~~SUBSIDIARIES

~~(IN~~CONSOLIDATED ~~THOUSANDS,~~STATEMENTS ~~EXCEPT~~OF ~~PER~~CASH ~~SHARE AMOUNTS)~~FLOWS

	Years Ended
	June 30, 2024			July 2, 2023
NET SALES	$	537,766		$	492,946
Cost of goods sold		472,298			450,794
GROSS PROFIT		65,468			42,152
Engineering, selling, and administrative expenses		47,654			48,241
INCOME (LOSS) FROM OPERATIONS		17,814			(6,089	)
Equity (loss) earnings of joint ventures		(331	)		1,559
Interest expense		(900	)		(960	)
Investment Income		572			—
Other income (expense), net		3,048			(2,178	)
INCOME (LOSS) BEFORE BENEFIT FOR INCOME TAXES AND NON-CONTROLLING INTEREST		20,203			(7,668	)
Provision for income taxes		3,775			1,281
NET INCOME (LOSS)		16,428			(8,949	)
Net income (loss) attributable to non-controlling interest		115			(2,279	)
NET INCOME (LOSS) ATTRIBUTABLE TO STRATTEC SECURITY CORPORATION	$	16,313		$	(6,670	)
COMPREHENSIVE INCOME (LOSS):
NET INCOME (LOSS)	$	16,428		$	(8,949	)
Currency translation adjustments, net of tax		(2,794	)		6,164
Pension and postretirement plans, net of tax		193			689
TOTAL OTHER COMPREHENSIVE (LOSS) INCOME		(2,601	)		6,853
COMPREHENSIVE INCOME (LOSS)		13,827			(2,096	)
Comprehensive (loss) income attributable to non-controlling interest		(991	)		180
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO STRATTEC SECURITY CORPORATION	$	14,818		$	(2,276	)
INCOME (LOSS) PER SHARE ATTRIBUTABLE TO STRATTEC SECURITY CORPORATION:
Basic	$	4.10		$	(1.70	)
Diluted	$	4.07		$	(1.70	)
AVERAGE SHARES OUTSTANDING:
Basic		3,975			3,921
Diluted		4,004			3,921

(in thousands)

The accompanying Notes to Financial Statements are an integral part of these Consolidated Statements of Income (Loss) and Comprehensive Income (Loss).


	Years Ended
	June 29, 2025			June 30, 2024
OPERATING ACTIVITIES:
Net income	$	18,919		$	16,428
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		14,764			16,547
Foreign currency transaction loss (gain)		591			(2,153	)
Deferred income taxes		(1,890	)		(4,711	)
Stock-based compensation expense		2,725			1,467
Unrealized gain on peso contracts		(2,314	)		—
Change in operating assets and liabilities:
Receivables		(3,085	)		(9,356	)
Inventories		16,948			(4,052	)
Other assets		12,027			(13,562	)
Accounts payable		10,674			(3,016	)
Accrued liabilities		970			13,754
Other, net		1,348			919
Net cash provided by operating activities		71,677			12,265
INVESTING ACTIVITIES:
Proceeds from sale of interest in joint ventures		—			2,000
Purchase of property, plant and equipment		(7,156	)		(9,788	)
Net cash used in investing activities		(7,156	)		(7,788	)
FINANCING ACTIVITIES:
Borrowings under credit facilities		3,000			2,000
Repayments under credit facilities		(8,000	)		(2,000	)
Employee stock purchases		61			72
Net cash (used in) provided by financing activities		(4,939	)		72
Foreign currency impact on cash		(413	)		290
NET INCREASE IN CASH AND CASH EQUIVALENTS		59,169			4,839

CASH AND CASH EQUIVALENTS:
Beginning of year		25,410			20,571
End of year	$	84,579		$	25,410

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Income taxes	$	14,174		$	3,801
Interest	$	1,007		$	888
Non-cash investing activities:
Change in capital expenditures in accounts payable	$	(422	)	$	171

The accompanying notes are an integral part of these Consolidated Financial Statements.

~~CONSOLIDATED~~STRATTEC ~~BALANCE~~SECURITY ~~SHEETS~~CORPORATION AND SUBSIDIARIES

~~(IN~~NOTES ~~THOUSANDS,~~TO ~~EXCEPT~~CONSOLIDATED ~~SHARE~~FINANCIAL ~~AMOUNTS AND PER SHARE AMOUNTS)~~STATEMENTS

	June 30, 2024			July 2, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	25,410		$	20,571
Receivables, less allowance for credit losses of $500 at June 30, 2024 and July 2, 2023		99,297			89,811
Inventories, net		81,649			77,597
Customer tooling in progress, net		22,173			20,800
Income taxes recoverable		319			2,711
Value added tax recoverable		19,684			7,912
Other current assets		5,282			6,380
Total current assets		253,814			225,782
DEFERRED INCOME TAXES		17,593			13,619
OTHER LONG-TERM ASSETS		6,698			7,083
PROPERTY, PLANT AND EQUIPMENT, NET		86,184			94,446
	$	364,289		$	340,930
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	54,911		$	57,927
Accrued liabilities:
Payroll and benefits		28,953			22,616
Value added tax payable		9,970			6,499
Income tax payable		5,103			2,607
Environmental		1,390			1,390
Warranty		10,695			9,725
Other		7,266			8,222
Total current liabilities		118,288			108,986
Commitments and Contingencies – see note beginning on page 46
BORROWINGS UNDER CREDIT FACILITIES		13,000			13,000
ACCRUED PENSION OBLIGATIONS		1,379			1,206
ACCRUED POSTRETIREMENT OBLIGATIONS		1,050			1,157
OTHER LONG-TERM LIABILITIES		4,957			5,557
SHAREHOLDERS’ EQUITY:
Common stock, authorized 18,000,000, $.01 par value, issued 7,586,920 shares at June 30, 2024 and 7,530,170 shares at July 2, 2023		76			75
Capital in excess of par value		101,024			100,309
Retained earnings		250,612			234,299
Accumulated other comprehensive loss		(15,689	)		(14,194	)
Less: Treasury stock at cost (3,598,126 shares at June 30, 2024 and 3,601,124 shares at July 2, 2023)		(135,478	)		(135,526	)
Total STRATTEC SECURITY CORPORATION shareholders’ equity		200,545			184,963
Non-controlling interest		25,070			26,061
Total shareholders’ equity		225,615			211,024
	$	364,289		$	340,930

NOTE 1. ORGANIZATION AND NATURE OF BUSINESS

~~The~~Strattec ~~accompanying~~Security ~~Notes~~Corporation to("the ~~Financial~~Company," ~~Statements~~"Strattec," ~~are~~"we," anor ~~integral~~"us"), ~~part~~headquartered in Milwaukee, Wisconsin, is a leading global provider of ~~these~~advanced ~~Consolidated~~automotive ~~Balance~~security, ~~Sheets~~access and user interface solutions. While the Company serves major automotive OEMs globally, the majority of sales are to the three largest automobile original equipment manufacturers (“OEMs”) in North America.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation and Basis of Presentation

The accompanying consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP) and reflect the consolidated results of Strattec. All significant intercompany transactions and balances have been eliminated in consolidation. The Company's fiscal year ends on the Sunday nearest June 30. The years ended June 29, 2025 and June 30, 2024 are each comprised of 52 weeks.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses for the periods presented. These estimates and assumptions could also affect the disclosure of contingencies. Actual results and outcomes may differ from management’s estimates and assumptions.

Recently Issued Accounting Standards

In fiscal 2025, we adopted the guidance in Accounting Standards Codification (ASC) 280-10 as updated by Accounting Standards Update (ASU) 2023-07, Improvements to Reportable Segment Disclosures, which requires companies -- even for entities with a single reportable segment -- to disclose their significant segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM), details of the composition of other segment items, and the title and position of the CODM along with an explanation of how the CODM uses the reported measures in assessing performance. Refer to Note 14, "Segment Information" for additional information.

In December 2023, the Financial Accounting Standards Board (FASB) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU is intended to enhance the transparency and decision usefulness of income tax disclosures to provide information to better assess how an entity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. For the Company, this ASU is effective for annual periods beginning after December 15, 2024 (fiscal 2026). The Company is currently evaluating the impact the adoption of this standard will have on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This ASU requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, intangible asset amortization and depletion) included in certain expense captions presented on the face of the income statement. The ASU is effective for fiscal years beginning after December 15, 2026 (fiscal 2028) and for interim periods beginning after December 15, 2027 (fiscal 2029). The Company is currently evaluating the impact the adoption of this standard will have on its consolidated financial statements.

Cash and Cash Equivalents

Cash and cash equivalents include all short-term investments with an original maturity of three months or less due to the short-term nature of the instruments. Excess cash balances are invested in money market funds.

Receivables

Receivables are stated net of an allowance for credit losses. The collectability of receivables is evaluated on an ongoing basis. An allowance for credit losses is recorded for estimated amounts of receivables not expected to be collected based upon factors such as age of the outstanding receivables, historical payment experience, customer creditworthiness and general economic conditions.

~~CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY~~Inventories

~~(IN~~Inventories ~~THOUSANDS~~are comprised of material, ~~EXCEPT~~direct ~~PER~~labor ~~SHARE~~and ~~AMOUNTS~~manufacturing overhead, and are stated at lower of cost or market, with market determined based on estimated net realizable value using the first-in, first-out (“FIFO”) cost method.

	TotalShareholders'Equity			CommonStock		Capital inExcess ofPar Value			RetainedEarnings			AccumulatedOtherComprehensiveLoss			TreasuryStock			Non-controllinginterest
BALANCE July 3, 2022	$	219,947		$	75	$	101,524		$	240,969		$	(18,588	)	$	(135,580	)	$	31,547
Net loss		(8,949	)		—		—			(6,670	)		—			—			(2,279	)
Currency translation adjustments		6,164			—		—			—			3,705			—			2,459
Pension and postretirement funded status adjustment, net of tax of $212		689			—		—			—			689			—			—
Cash dividends paid to non- controlling interests of subsidiaries		(600	)		—		—			—			—			—			(600	)
Purchase of SPA Non- controlling interest		(7,877	)		—		(2,811	)		—						—			(5,066	)
Stock-based compensation		1,466			—		1,466			—			—			—			—
Stock option exercises		109			—		109			—			—			—			—
Employee stock purchases		75			—		21			—			—			54			—
BALANCE July 2, 2023	$	211,024		$	75	$	100,309		$	234,299		$	(14,194	)	$	(135,526	)	$	26,061
Net income		16,428			—		—			16,313			—			—			115
Currency translation adjustments		(2,794	)		—		—			—			(1,688	)		—			(1,106	)
Pension and postretirement funded status adjustment, net of tax of $59		193			—		—			—			193			—			—
Purchase of SPA Non- controlling interest		(775	)		—		(775	)		—						—			—
Stock-based compensation		1,467			—		1,467			—			—			—			—
Employee stock purchases		72			1		23			—			—			48			—
BALANCE June 30, 2024	$	225,615		$	76	$	101,024		$	250,612		$	(15,689	)	$	(135,478	)	$	25,070

Excess and obsolete inventory reserves are recorded based on historical and estimated future demand and market conditions. The reserve level is determined by comparing inventory levels of individual raw materials, components and finished goods to historical usage and assessing the age of the inventory and likelihood of future sales. Technical obsolescence and other known factors are also considered in evaluating the reserve level. The increase in the reserve in fiscal 2025 was driven by changes in the inventory profile and resulting revisions to estimates of excess and obsolete inventory. The excess and obsolete reserve balance was $11.2 million at June 29, 2025 compared with $7.8 million at June 30, 2024.

~~The~~Pre-production ~~accompanying Notes to Financial Statements are an integral part of these Consolidated Statements of Shareholders’ Equity.~~Costs

The Company incurs costs related to tooling used in the manufacture of products sold to its customers and engineering development. In some cases, the Company enters into contracts with its customers whereby the Company incurs the costs to design, develop and purchase tooling and is then reimbursed by the customer under a reimbursement contract. In addition, certain customer contracts include reimbursement of engineering development costs. Tooling costs and engineering development costs that will be reimbursed by customers are included in other Pre-production Costs in the accompanying consolidated balance sheets at lower of accumulated cost or the customer reimbursable amount. To the extent that costs incurred exceed the contractual reimbursement, amounts are recognized as expense in the accompanying consolidated income statement when incurred.

Value-Added Tax

The Company's Mexican subsidiaries are subject to value-added tax (“VAT”). VAT is paid on goods and services and collected on sales. A VAT certification generally allows for relief from VAT tax for temporarily imported goods. A temporary suspension of the Company's VAT tax certification during fiscal 2024 resulted in an increase in the value-added tax recoverable balance. During fiscal 2025, a portion of the value-added tax recoverable was collected. Remaining amounts are subject to an audit by the Mexican tax authority before VAT refunds will be received.

Property, Plant and Equipment

Property, plant and equipment are stated at cost. Plant and equipment are depreciated on a straight-line basis over the estimated useful lives of the assets. Land improvements have an estimated useful life of 20 years, while buildings and improvements range from 15 to 35 years, and machinery and equipment range from 3 to 15 years.

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such indicators are present, the recoverability of assets is assessed by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset. If an asset is determined to not be recoverable, the impairment recognized is calculated as the excess of the carrying amount of the asset over the fair value of the asset.

Leases

The Company determines whether a contractual arrangement is or contains a lease at contract inception. A lease liability and corresponding right-of-use asset are measured and recognized based on the present value of lease payments. To determine the present value of lease payments, the Company uses its incremental borrowing rate as of the lease commencement date, unless there is a rate implicit in the lease agreement. The incremental borrowing rate is based on the Company's credit rating, determined on a fully collateralized loan basis from information available at commencement date, and the duration of the lease term.

Operating lease assets are included in operating lease right-of-use assets and the related liabilities are included in current lease liabilities and non-current lease liabilities in the accompanying consolidated balance sheets. For all classes of underlying assets, the Company accounts for leases that contain separate lease and non-lease components as containing a single lease component. The Company does not recognize lease right-of-use assets and lease liabilities from leases with an original lease term of twelve months or less and, instead, recognizes rent payments on a straight-line basis over the lease term in the consolidated statements of income. Refer to Note 5, "Leases," for additional information.

~~CONSOLIDATED~~Research ~~STATEMENTS~~and OFDevelopment ~~CASH FLOWS~~Costs

~~(IN~~Expenditures ~~THOUSANDS)~~relating to the development of new products and processes, including significant improvements and refinements to existing products, are expensed as incurred. Research and development expenditures were $21.7 million in 2025 and $14.8 million in 2024.

	Years Ended
	June 30, 2024			July 2, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	16,428		$	(8,949	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity loss (earnings) of joint ventures		331			(1,559	)
Depreciation		16,547			17,485
Foreign currency transaction (gain) loss		(2,153	)		2,935
Loss on settlement of pension obligation		—			217
Deferred income taxes		(4,711	)		(4,937	)
Stock-based compensation expense		1,467			1,466
Change in operating assets and liabilities:
Receivables		(9,356	)		(13,696	)
Inventories		(4,052	)		2,885
Other assets		(13,562	)		(10,483	)
Accounts payable and accrued liabilities		10,738			23,964
Other, net		588			767
Net cash provided by operating activities		12,265			10,095
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in joint ventures		—			(278	)
Proceeds from Sale of interest in VAST LLC		2,000			26,170
Purchase of VAST Korea net assets		—			354
Additions to property, plant and equipment		(9,788	)		(17,370	)
Proceeds received on sale of property, plant and equipment		—			25
Net cash (used in) provided by investing activities		(7,788	)		8,901
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings under credit facilities		2,000			17,000
Repayments under credit facilities		(2,000	)		(15,000	)
Purchase of SPA non-controlling interest		—			(9,019	)
Exercise of stock options and employee stock purchases		72			183
Dividends paid to non-controlling interests of subsidiaries		—			(600	)
Net cash provided by (used in) financing activities		72			(7,436	)
FOREIGN CURRENCY IMPACT ON CASH		290			237
NET INCREASE IN CASH AND CASH EQUIVALENTS		4,839			11,797
CASH AND CASH EQUIVALENTS
Beginning of year		20,571			8,774
End of year	$	25,410		$	20,571
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash Paid During the Period For:
Income taxes	$	3,801		$	2,759
Interest	$	888		$	890
Non-Cash Investing Activities:
Purchase price receivable from sale of interest in VAST LLC	$	—		$	(2,000	)
Change in capital expenditures in accounts payable	$	171		$	(1,437	)

Derivative Instruments

Derivative financial instruments are recognized as either assets or liabilities at fair value. The ~~accompanying~~accounting ~~Notes~~for tochanges ~~Financial~~in ~~Statements~~the ~~are~~fair value of each derivative financial instrument depends on whether it has been designated and qualifies as an ~~integral~~accounting ~~part~~hedge, ofas ~~these~~well ~~Consolidated~~as ~~Statements~~the type of hedging relationship identified. Cash ~~Flows~~flows for all derivative financial instruments are typically classified in cash flows from operating activities. Derivative instruments are not used for trading or speculative purposes.

During both fiscal 2025 and 2024, the Company entered into currency forward contracts covering a portion of peso denominated operating costs. The objective in entering into these contracts was to minimize earnings volatility resulting from changes in foreign currency exchange rates, specifically the Mexican peso / U.S. dollar exchange rate. These currency forward contracts are not designated as hedges and changes in fair value are recognized in Other income, net on the consolidated income statement.

Fair Value

The Company assesses the inputs used to measure the fair value of financial assets and liabilities using a three-tier hierarchy:

•

Level 1 -- Observable inputs that reflect quoted prices for identical assets or liabilities in active markets that we have the ability to access at the measurement date.

•

Level 2 -- Observable inputs, other than quoted prices included in Level 1, for the asset or liability or prices for similar assets and liabilities.

•

Level 3 -- Unobservable inputs that include management’s own judgments about the assumptions market participants would use in pricing an asset or liability.

The fair value of the Company's cash and cash equivalents, accounts receivable, post-employment plan assets, accounts payable and variable rate borrowings under revolving credit agreements approximated the book value at June 29, 2025 and June 30 2024, due to their short-term nature and the fact that the interest rates, as applicable, approximated market rates. The fair value of all derivative instruments were based on quoted inactive market prices and therefore are classified as Level 2 within the valuation hierarchy.

Warranty Reserve

The Company generally offers its customers an assurance warranty on products sold, although warranty periods may vary by product type and application. The Company has a warranty reserve related to known and potential exposure to warranty claims in the event products fail to perform as expected and in the event the Company may be required to participate in the repair costs incurred by customers for such products. The estimation of the warranty reserve involves judgment and assumptions and is based on an analysis of historical warranty data as well as current trends and information. Changes in estimates related to pre-existing warranties are included in provision charged to expense in the table below. Changes in the warranty reserve were as follows (in thousands):


	Years Ended
	June 29, 2025			June 30, 2024
Balance, beginning of period	$	10,695		$	9,725
Provision charged to expense		(376	)		2,608
Payments		(1,419	)		(1,638	)
Balance, end of period	$	8,900		$	10,695

~~NOTES~~Revenue TOfrom ~~FINANCIAL~~Contracts ~~STATEMENTS~~with Customers

~~ORGANIZATION~~The ~~AND~~Company ~~SUMMARY~~enters OFinto ~~SIGNIFICANT~~contracts ~~ACCOUNTING~~with ~~POLICIES~~customers to provide production parts generally at the beginning of a vehicle's lifecycle. Typically, these contracts do not provide for a specified quantity of products, but once entered into, the Company is often expected to fulfill our customers' purchasing requirements for the production life of the vehicle. Many of these contracts may be terminated by our customers at any time. However, terminations of these contracts have been infrequent, historically.

~~STRATTEC~~Revenue ~~SECURITY~~is ~~CORPORATION~~recognized ~~designs,~~at ~~develops,~~a ~~manufactures~~point ~~and~~in ~~markets~~time ~~automotive~~when ~~security, access~~ control, ~~and~~of ~~user~~the ~~interface~~product ~~controls~~is ~~products~~transferred ~~and~~to ~~solutions.~~the ~~This~~customer ~~includes~~under ~~mechanical~~the ~~locks~~terms ~~and~~of ~~keys~~the contract, ~~electronically~~which ~~enhanced~~is ~~locks~~when ~~and~~parts ~~keys,~~are ~~passive~~shipped ~~entry~~or ~~passive~~delivered. ~~start~~The ~~systems~~amount ~~(PEPS),~~of ~~phone~~revenue asrecognized ais ~~key~~based ~~systems~~on ~~(PaaK),~~the ~~steering~~transaction ~~column~~price and ~~instrument~~the ~~panel~~quantity ~~ignition~~of ~~lock~~parts ~~housings,~~specified ~~latches,~~in ~~power~~the ~~sliding~~contract. ~~side~~Discrete ~~door~~price ~~systems,~~adjustments ~~power~~may ~~tailgate~~occur ~~systems,~~during ~~power~~the ~~lift~~vehicle ~~gate~~production ~~systems,~~period ~~power~~in ~~deck~~order ~~lid systems, door handles steering wheel switches and controller, E-shifters, paddle switches and related products~~ for ~~primarily~~the ~~North~~Company ~~American~~to ~~automotive~~remain ~~customers.~~competitive ~~We also previously supplied global automotive manufacturers through a strategic relationship~~ with ~~WITTE~~market ~~Automotive~~prices ~~(“WITTE”)~~or ofbased ~~Velbert,~~on ~~Germany~~changes ~~and~~in ~~ADAC~~product ~~Plastics Inc~~specifications. ~~(doing~~Some ~~business as ADAC Automotive (“ADAC”),~~ of ~~Grand~~these ~~Rapids,~~price ~~Michigan)~~adjustments ~~called~~require ~~Vehicle~~estimation. ~~Access~~In ~~Systems~~the ~~Technology~~event ~~LLC ("VAST LLC"), doing business as~~ the ~~VAST~~Company ~~Automotive~~concludes ~~Group~~that ~~(“VAST”).~~a ~~Under~~portion ~~this~~of ~~unique strategic relationship, STRATTEC, WITTE and ADAC marketed~~ the ~~products~~revenue offor ~~each~~a ~~company~~given topart ~~global~~may ~~customers~~vary ~~under~~from the ~~“VAST~~purchase ~~Automotive Group” brand name. Effective as of June 30~~order, ~~2023,~~the ~~STRATTEC~~Company ~~sold~~records ~~its~~consideration ~~one-third~~at ~~interest~~the inmost ~~VAST~~likely ~~LLC~~amount to ~~WITTE.~~which ~~As of~~ the ~~closing~~Company ofexpects ~~the sale of its VAST LLC interest, STRATTEC entered into a strategic preferred partner relationship with WITTE covering VAST LLC pursuant~~ to ~~the~~be ~~terms~~entitled ofbased aon ~~cooperation~~historical ~~framework~~experience ~~agreement that enables STRATTEC to continue to market~~ and ~~rely~~input onfrom ~~the~~customer ~~global~~negotiations. ~~capabilities~~The ofCompany's ~~VAST~~customers ~~LLC.~~pay ~~STRATTEC~~for products ~~are~~received ~~shipped to customer locations~~ in ~~the~~accordance ~~United States, Canada, Mexico, Europe, South America, Korea, and China, and we, along~~ with ~~our~~payment ~~partners,~~terms ~~provide~~that ~~full~~are ~~service~~customary ~~and~~within ~~aftermarket~~the ~~support for each VAST Automotive Group partners’ products~~industry.

~~The~~Income accompanying consolidated financial statements reflect the consolidated results of STRATTEC SECURITY CORPORATION, its wholly owned subsidiaries, STRATTEC de Mexico and STRATTEC POWER ACCESS LLC (“SPA”), and its majority owned subsidiary, ADAC-STRATTEC, LLC. Effective June 30, 2023, SPA became a wholly owned subsidiary of STRATTEC SECURITY CORPORAITON as a result of the purchase of the remaining non-controlling interest. Prior to June 30, 2023, STRATEC owned 80 percent of SPA. STRATTEC is headquartered in Milwaukee, Wisconsin. STRATTEC de Mexico is located in Juarez, Mexico. ADAC-STRATTEC, LLC and SPA have operations in El Paso, Texas and in Juarez and Leon, Mexico. For periods prior to June 30, 2023, the accompanying financial statements also reflect the results of our one-third equity investment in VAST LLC for which we exercised significant influence but did not control and were not variable interest entities of STRATTEC. VAST LLC was accounted for using the equity method and consisted primarily of four wholly owned subsidiaries in China, one wholly owned subsidiary in Brazil and one joint venture entity in India. We have only one reporting segment.Taxes

~~Risks~~The Company records income tax expense using the liability method which specifies that deferred tax assets and ~~Uncertainties:~~liabilities ~~STRATTEC’s~~be ~~operating~~measured ~~performance~~each isyear ~~subject~~based toon ~~global~~the ~~economic~~difference ~~conditions,~~between ~~inflationary~~the ~~pressures~~financial statement and ~~levels~~tax base of ~~consumer~~assets ~~spending~~and ~~specifically~~liabilities ~~within~~at the ~~automotive~~applicable ~~industry~~enacted tax rates. InA ~~our~~valuation ~~fiscal~~allowance ~~year~~is ~~2023,~~provided ~~the~~for ~~inflationary~~deferred ~~pressures~~tax ~~negatively~~assets ~~affected~~when management considers it more likely than not that the ~~areas~~asset ofwill ~~raw~~not ~~materials,~~be ~~purchased~~realized. ~~materials~~At ~~and~~June ~~wage~~29, ~~rates~~2025 inand ~~Mexico~~June 30, ~~resulting~~2024, ina ~~increased~~valuation ~~raw~~allowance ~~material~~has ~~and~~been ~~purchased~~provided ~~part~~for ~~costs~~certain indeferred tax assets which the ~~year.~~Company ~~While~~has ~~our~~concluded ~~fiscal~~are ~~2024~~more ~~results~~likely ~~reflect~~than ~~reduced~~not ~~raw~~to ~~material~~not ~~costs~~be asrealized. ~~compared~~If future annual taxable income were to ~~our~~be ~~fiscal~~significantly ~~2023~~less than current and projected levels, ~~inflationary~~there ~~pressures~~is ona ~~purchased~~risk ~~material~~that ~~and~~certain ~~wage~~of ~~rates~~our indeferred ~~Mexico~~tax ~~persist~~assets ~~and~~not ~~may~~already ~~continue~~provided tofor ~~negatively~~by ~~impact~~th

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