UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2025~~2026

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number 1-13752

Smith-Midland Corporation

(Exact name of Registrant as specified in its charter)

Delaware		54-1727060
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

5119 Catlett Road, P.O. Box 300

Midland, VA 22728

(Address, zip code of principal executive offices)

(540) 439-3266

(Registrant’s telephone number, including area code)

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

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, $0.01 par value per share		SMID		NASDAQ

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 par value per share, outstanding as of ~~November~~May 131, ~~2025~~2026: 5,~~304~~306,~~606~~554 shares, net of treasury shares

SMITH-MIDLAND CORPORATION

Form 10-Q Index

		Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)		3
Condensed Consolidated Balance Sheets		3
Condensed Consolidated Statements of Income		5
Condensed Consolidated Statements of Stockholders' Equity		6
Condensed Consolidated Statements of Cash Flows		7
Notes to Condensed Consolidated Financial Statements		8
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations		1615
Item 3. Quantitative and Qualitative Disclosures About Market Risk		2523
Item 4. Controls and Procedures		2523
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		2725
Item 1A. Risk Factors		2725
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		2725
Item 3. Defaults Upon Senior Securities		2725
Item 4. Mine Safety Disclosures		2725
Item 5. Other Information		2725
Item 6. Exhibits		2826
Signatures		2927

Table of Contents

PART I — FINANCIAL INFORMATION

ITEM 1. Financial Statements

Smith-Midland Corporation

and Subsidiaries

(unaudited)

Condensed Consolidated Balance Sheets

(Unaudited)

(in thousands, except share and per share data)

ASSETS	~~September~~March 3031, ~~2025~~2026		December 31,~~2024~~2025
Current assets
Cash	$	13,~~376~~218	$	711,~~548~~884
Accounts receivable, net
Trade - billed (less allowances of approximately $1,166 and $1,130, respectively), including contract retentions		25,460		19,420
Trade - billed (less allowances of approximately $651 and $539, respectively), including contract retentions		28,052		27,228
Trade - unbilled		1,~~396~~836		1,~~327~~173
Inventories, net
Raw materials		21,~~498~~741		21,~~078~~710
Finished goods		5,~~392~~476		45,~~599~~218
Prepaid expenses		1,~~684~~269		~~877~~1,511
Total current assets		49,806		35,849
Refundable income taxes ex		23		23
Property and equipment, net		35,126		31,704
Total current assets		51,615		48,747
Other assets		505		438
Property and equipment, net		39,975		38,478
Total assets	$	85,437	$	67,991
Other assets		605		504
Total assets	$	92,195	$	87,729

The accompanying notes are an integral part of the condensed consolidated financial statements.

Table of Contents

Smith-Midland Corporation

and Subsidiaries

(unaudited)

Condensed Consolidated Balance Sheets

(Unaudited)

(in thousands, except share and per share data)

(continued)

LIABILITIES AND STOCKHOLDERS' EQUITY	~~September~~March 3031, ~~2025~~2026			December 31, ~~2024~~2025
Current liabilities
Accounts payable - trade	$	58,~~740~~266		$	45,~~741~~482
Accrued expenses and other liabilities		~~466~~205			~~429~~907
Deferred revenue		~~3,688~~945			41,~~313~~128
Accrued compensation		2,~~110~~409			12,~~770~~164
Accrued income taxes		2,~~658~~024			1,~~539~~602
Operating lease liabilities		2021			2120
Current maturities of notes payable		~~657~~655			~~658~~648
Customer deposits		2,~~689~~051			12,~~539~~381
Total current liabilities		1816,~~028~~576			1514,~~010~~332
Deferred revenue		1014,~~785~~810			613,~~222~~763
Operating lease liabilities		8065			9070
Notes payable - less current maturities		3,~~933~~626			43,~~436~~799
Deferred tax liability		~~484~~1,460			~~494~~1,461
Total liabilities		3336,~~310~~537			2633,~~252~~425
Commitments and contingencies (Note 9)
Stockholders’ equity
Preferred stock, $.01 par value; authorized 1,000,000 shares, none issued and outstanding		—			—
Preferred stock, $0.01 par value; authorized 1,000,000 shares, none issued and outstanding		—			—
Common stock, $.01 par value; authorized 8,000,000 shares; 5,346,526 and 5,346,526 issued and 5,304,606 and 5,304,606 outstanding, respectively		54			54
Common stock, $0.01 par value; authorized 8,000,000 shares; 5,347,474 and 5,347,474 issued and 5,306,554 and 5,306,554 outstanding as of March 31, 2026 and December 31, 2025, respectively		54			54
Additional paid-in capital		7,~~730~~791			7,~~717~~776
Treasury stock, at cost, 40,920 shares		(102	)		(102	)
Retained earnings		4447,~~445~~915			3446,~~070~~576
Total stockholders' equity		5255,~~127~~658			4154,~~739~~304
Total liabilities and stockholders' equity	$	8592,~~437~~195		$	6787,~~991~~729

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Smith-Midland Corporation

and Subsidiaries

Condensed Consolidated Statements of Income

(~~Unaudited~~unaudited)

(in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	Three Months Ended March 31,
	2025			2024			2025			2024
	2026			2025
Revenue
Product sales	$	11,~~911~~786		$	109,~~753~~112		$	~~34,459~~		$	~~34,621~~
Barrier rentals		32,~~269~~201			78,~~053~~425			~~17,474~~			~~9,303~~
Royalty income		~~1,083~~823			~~958~~890			~~3,299~~			~~2,403~~
Shipping and installation revenue		56,~~188~~762			4,~~818~~271			~~15,103~~			~~13,650~~
Total revenue		21,~~451~~572			2322,~~582~~698			~~70,335~~			~~59,977~~
Cost of sales		1517,~~692~~269			1715,~~004~~723			~~49,815~~			~~44,353~~
Gross profit		54,~~759~~303			6,~~578~~975			~~20,520~~			~~15,624~~
Operating expenses
General and administrative expenses		1,~~100~~753			1,~~720~~584			~~4,198~~			~~4,938~~
Selling expenses		~~805~~822			1,~~010~~004			~~2,563~~			~~2,655~~
Total operating expenses		12,~~905~~575			2,~~730~~588			~~6,761~~			~~7,593~~
Operating income		31,~~854~~728			34,~~848~~387			~~13,759~~			~~8,031~~
Other income (expense)
Interest expense		(4447	)		(5655	)		~~(161~~	)		~~(175~~	)
Interest income		7265			227			85			36
Gain on sale of assets		—			16			—			19
Other income		15			8
Other income (expense), net		(11	)		14			17			50
Total other income (expense)		33			(40	)
Total other income (expense)		17			(4	)		(59	)		(70	)
Income before income tax expense (benefit)		1,761			4,348
Income before income tax expense		3,871			3,844			13,700			7,961
Income tax expense (benefit)		422			1,020
Income tax expense		994			694			3,325			1,683
Net income	$	1,339		$	3,327
Net income	$	2,877		$	3,150		$	10,375		$	6,278
Basic earnings per common share	$	0.25		$	0.63
Basic and diluted earnings per common share	$	0.54		$	0.59		$	1.96		$	1.18
Diluted earnings per common share	$	0.25		$	0.62
Weighted average number of common shares outstanding:
Basic		5,~~305~~307			5,304			~~5,305~~			~~5,283~~
Diluted		5,~~305~~307			5,~~304~~305			~~5,304~~			~~5,283~~

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Smith-Midland Corporation

and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity

(~~Unaudited~~unaudited)

(in thousands, except share data)

	CommonStock					Treasury Stock						AdditionalPaid-in			Retained
	Shares			Amount		Shares			Amount			Capital			Earnings		Total
Balance, December 31, 2025		5,347,474		$	54		(40,920	)	$	(102	)	$	7,776		$	46,576	$	54,304
Issuance of restricted stock		408			—		—			—			15			—		15
Net income		—			—		—			—			—			1,339		1,339
Balance, March 31, 2026		5,347,882		$	54		(40,920	)	$	(102	)	$	7,791		$	47,915	$	55,658
Balance, December 31, 2024		5,346,526		$	54		(40,920	)	$	(102	)	$	7,717		$	34,070	$	41,739
Vesting of restricted stock		—			—		—			—			4			—		4
Net income		—			—		—			—			—			3,327		3,327
Balance, March 31, 2025		5,346,526		$	54		(40,920	)	$	(102	)	$	7,721		$	37,397	$	45,070
Vesting of restricted stock		—			—		—			—			4			—		4
Net income		—			—		—			—			—			4,171		4,171
Balance, June 30, 2025		5,346,526		$	54		(40,920	)	$	(102	)	$	7,725		$	41,568	$	49,245
Vesting of restricted stock		—			—		—			—			5			—		5
Net income		—			—		—			—			—			2,877		2,877
Balance, September 30, 2025		5,346,526		$	54		(40,920	)	$	(102	)	$	7,730		$	44,445	$	52,127
Balance, December 31, 2023		5,349,599		$	54		(40,920	)	$	(102	)	$	7,814		$	26,395	$	34,161
Vesting of restricted stock		—			—		—			—			5			—		5
Net income		—			—		—			—			—			1,147		1,147
Balance, March 31, 2024		5,349,599		$	54		(40,920	)	$	(102	)	$	7,819		$	27,542	$	35,313
Vesting of restricted stock		—			—		—			—			5			—		5
Settlement of restricted stock		(3,840	)		—		—			—			(117	)		—		(117	)
Net income		—			—		—			—			—			1,981		1,981
Balance, June 30, 2024		5,345,759		$	54		(40,920	)	$	(102	)	$	7,707		$	29,523	$	37,182
Stock granted		767			—		—			—			—			—		—
Vesting of restricted stock		—			—		—			—			5			—		5
Net income		—			—		—			—			—			3,150		3,150
Balance, September 30, 2024		5,346,526		$	54		(40,920	)	$	(102	)	$	7,712		$	32,673	$	40,337

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Smith-Midland Corporation

and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)

	Nine Months EndedSeptember 30,
	Three Months EndedMarch 31,
	2025			2024
	2026			2025
Cash flows from operating activities:
Net income	$	101,~~375~~339		$	63,~~278~~327
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization		~~1,915~~951			~~1,996~~671
(Gain) on sale of property and equipment		—			(19	)
Allowance for credit losses		112			92
Allowance for credit losses		36			271
Stock compensation		15			4
Stock compensation		13			40
Deferred taxes		—			(10	)
Settlement of restricted stock		—			(142	)
Deferred taxes		(10	)		(1	)
(Increase) decrease in
Accounts receivable - billed		(~~6,076~~936	)		(~~884~~3,552	)
Accounts receivable - unbilled		(69663	)		~~(389~~375	)
Inventories		(~~1,213~~289	)		(~~1,092~~807	)
Prepaid expenses and other assets		(874	)		186
Prepaid expenses		137			(365	)
Refundable income taxes		—			(23	)
Increase (decrease) in
Accounts payable - trade		1,~~044~~966			~~(1,909~~37	)
Accrued expenses and other liabilities		26(702	)		21(33	)
Deferred revenue		~~3,938~~864			31,~~052~~426
Accrued compensation		~~340~~245			~~178~~(586	)
Accrued income taxes		~~1,119~~421			~~(473~~1,017	)
Customer deposits		~~1,150~~(330	)		~~(1,287~~621	)
Net cash provided by (used in) operating activities		113,~~714~~130			52,~~803~~217
Cash flows from investing activities:
Purchases of property and equipment		(51,~~382~~630	)		(~~5,543~~595	)
Proceeds from the sale of property and equipment		-			25
Net cash provided by (used in) investing activities		(1,630	)		(595	)
Net cash provided by (used in) investing activities		(5,382	)		(5,518	)
Cash flows from financing activities:
Repayments of long-term borrowings		(~~504~~166	)		(~~447~~164	)
Net cash provided by (used in) financing activities		(~~504~~166	)		(~~447~~164	)
Net increase (decrease) in cash		51,~~828~~334			~~(162~~1,458	)
Cash
Beginning of period		711,~~548~~884			97,~~175~~548
End of period	$	13,~~376~~218		$	9,~~013~~006
Supplemental Cash Flow Information:
Cash payments for interest	$	~~161~~47		$	~~175~~55
Cash payments for income taxes	$	~~2,216~~—		$	~~1,558~~—
Non-Cash Investing Activities
Non-Cash Investing Activity:
Capital expenditures in accounts payable	$	~~381~~945		$	~~478~~1,034

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Smith-Midland Corporation

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. INTERIM FINANCIAL REPORTING

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information, and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, we have condensed or omitted certain information and footnote disclosures that are included in our annual consolidated financial statements. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the year ended December 31, ~~2024~~2025. The condensed consolidated December 31, ~~2024~~2025 balance sheet was derived from the audited financial statements included in the Form 10-K. Dollar amounts in the footnotes are stated in thousands, except for per share data.

In the opinion of management, these condensed consolidated financial statements reflect all adjustments (which consist of normal, recurring adjustments) necessary for a fair presentation of the financial position and results of operations and cash flows for the periods presented. The results disclosed in the condensed consolidated statements of income are not necessarily indicative of the results to be expected in any future periods.

~~Recently~~Recent Accounting Pronouncements

InEffective ~~December~~January ~~2023~~1, 2026, the ~~Financial~~Company ~~Accounting~~adopted ~~Standards Board (FASB) issued~~ ASU ~~2023~~2025-0905, ~~Improvements~~Financial toInstruments—Credit ~~Income~~Losses ~~Tax~~(Topic ~~Disclosures.~~326): ~~The~~Measurement ~~guidance~~of isCredit ~~intended~~Losses tofor ~~improve~~Accounts ~~income~~Receivable ~~tax disclosure requirements by requiring (i) consistent categories~~ and ~~greater~~Contract ~~disaggregation~~Assets. ofThe ~~information~~Company inelected the ~~rate~~practical ~~reconciliation~~expedient ~~and~~permitting ~~(ii)~~entities ~~the~~to ~~disaggregation~~assume ofthat ~~income~~current ~~taxes~~conditions ~~paid~~as byof ~~jurisdiction.~~the ~~The~~balance ~~guidance~~sheet ~~makes~~date ~~several~~remain ~~other~~unchanged ~~changes~~for to the ~~income~~remaining ~~tax~~life ~~disclosure~~of ~~requirements.~~certain ~~This~~short-term ~~guidance~~financial isassets ~~effective~~when ~~for~~estimating ~~annual~~expected ~~periods~~credit ~~beginning~~losses ~~after~~under ~~December~~ASC ~~15,~~326. ~~2024,~~The ~~with~~amendments ~~early~~were ~~adoption~~adopted ~~permitted, and is required to be applied~~ prospectively. ~~with~~Adoption ~~the option~~ of ~~retrospective~~the ~~application.~~standard ~~The~~did ~~Company~~not ishave ~~evaluating~~a ~~the~~material impact ofon the ~~standard~~Company’s oncondensed ~~its~~consolidated financial statements ~~and~~or related disclosures.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, requiring additional disclosures about specified categories of expenses included in certain expense captions presented on the face of the income statement. This standard will be effective for the Company for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, and may be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this guidance on the Company’s consolidated financial statements.

Table of Contents

Revenue Recognition

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers for product sales, royalty income and shipping and installation revenue. Revenue from barrier rentals is accounted for under ASC 842, Leases. Revenue accounted for (in thousands) under ASC 606 amounted to $19,372 and $14,273 during the quarters ended March 31, 2026 and 2025, respectively. Revenue accounted for (in thousands) under ASC 842 amounted to $2,201 and $8,425 during the quarters ended March 31, 2026 and 2025, respectively.

Product Sales - Over Time

The Company recognizes revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for goods or services provided. Revenue associated with contracts with customers for customized products is recognized over time aswhen the Company'’s performance (i) creates or enhances an asset that the customer~~-controlled~~ ~~assets~~controls, or (ii) creates or enhances an asset ~~with~~that has no alternative use, ~~which~~to the Company and the Company has an enforceable right to ~~receive~~payment ~~compensation as defined under the contract~~ for performance completed. ~~To determine the amount of revenue~~ to ~~recognize over time~~date, ~~the~~as ~~Company~~defined ~~recognizes~~in ~~revenue over~~ the contract ~~terms based on the output method~~. ~~The Company applied the "as invoiced" practical expedient as the amount of consideration the Company has the right to invoice corresponds directly with the value of the Company's performance to date.~~

AsTo determine the ~~output~~amount ~~method~~of isrevenue ~~driven~~to byrecognize ~~units~~over ~~produced~~time, the Company ~~recognizes~~measures ~~revenues~~progress ~~based~~toward oncomplete ~~the~~satisfaction ~~value~~of ~~transferred~~its toperformance ~~the~~obligations ~~customer~~using ~~relative~~an tooutput ~~the~~method ~~remaining~~based ~~value~~on ~~to be transferred. The Company also matches the costs associated with the~~ units produced~~. If a contract is projected to result in a loss~~, ~~the~~which ~~entire~~depicts ~~contract loss is recognized in~~ the ~~period~~value ~~when~~transferred ~~the~~to ~~loss was first determined and~~ the ~~amount~~customer ofrelative ~~the loss is updated in subsequent reporting periods. Revenue recognition also includes an amount related~~ to ~~a contract asset or contract liability. If~~ the ~~recognized~~remaining ~~revenue~~value ~~is greater than the amount billed~~ to ~~the~~be ~~customer, a contract asset is recorded in accounts receivable trade - unbilled~~transferred. ~~Conversely,~~Costs ifassociated ~~the~~with ~~amount billed to~~ the ~~customer~~units isproduced ~~greater~~are ~~than the~~ recognized ~~revenue,~~as ~~a contract liability is recorded in customer deposits~~incurred. Changes in the job performance, job conditions, and final contract settlements are factors that influence management’s assessment of total contract value and therefore, profit and revenue recognition.

AIf ~~portion~~a ofcontract ~~the~~is ~~work~~projected to result in a loss, the ~~Company~~entire ~~performs~~contract ~~requires~~loss ~~financial~~is ~~assurances~~recognized in the ~~form~~period ofwhen ~~performance~~the ~~and~~loss ~~payment~~is ~~bonds~~first atdetermined, and the ~~time~~amount of ~~execution~~the ofloss ~~the~~is updated in subsequent reporting periods. Revenue recognition includes amounts related to contract assets and contract liabilities. ~~Some~~If ~~contracts~~recognized ~~include~~revenue ~~retention~~exceeds ~~provisions~~amounts ofbilled, upa tocontract ~~10%~~asset is recorded in Accounts receivable, ~~which~~trade ~~are~~— ~~generally~~unbilled. ~~withheld~~Conversely, ~~from~~if ~~each~~amounts ~~progress~~billed ~~payment~~exceed asrecognized ~~retainage~~revenue, ~~until~~a ~~the~~contract liability is recorded in Customer deposits. Changes in job performance, job conditions, and final contract ~~work~~settlements ~~has~~are ~~been~~factors ~~completed~~that influence management’s assessment of total contract value and, ~~approved~~therefore, profit and revenue recognition.

Revenue recognized for product sales – over time (in thousands) are recorded in product sales under revenue in the consolidated financial statements which amounted to $5,479 and $4,733 during the quarters ended March 31, 2026 and 2025, respectively.

Product Sales - Point in Time

For certain product sales, that do not meet the criteria for recognition over time ~~criteria~~, the Company recognizes revenue ~~when~~at ~~the~~a ~~product~~point ~~has~~in ~~been~~time, ~~shipped~~generally toupon ~~the~~shipment ~~destination~~or indelivery ~~accordance~~(as ~~with~~specified ~~the terms outlined~~ in the contract), ~~where~~when acontrol ~~present~~of ~~obligation~~the product transfers to ~~pay~~the ~~exists~~customer and the ~~customers~~Company ~~have~~has ~~gained~~a ~~control~~present ofright ~~the~~to ~~product~~payment.

Revenue recognized for product sales – point in time (in thousands) are recorded in product sales under revenue in the consolidated financial statements which amounted to $6,307 and $4,379 during the quarters ended March 31, 2026 and 2025, respectively.

Accounts Receivable and Contract Balances

The timing of when ~~the~~we ~~Company~~bill ~~bills~~our ~~the~~ customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided or products are shipped. ~~The Company’s Accounts receivable trade – billed, arising from Topic 606 is $ 20,589 and $16,695 as of September 30, 2025 and December 31, 2024, respectively.~~

Projects with performance obligations recognized over time that have costs and estimated earnings recognized to date in excess of cumulative billings are reported on our Consolidated Balance Sheets as "Accounts receivable, ~~trade~~net includes -the ~~unbilled"~~following ~~(contract~~components ~~assets).~~on ~~The~~the ~~Company’s~~consolidated ~~Accounts~~balance ~~receivable trade – unbilled (i.e. contract assets) balances are as follows~~sheets:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Accounts receivable trade – unbilled, beginning of the period	$	1,240	$	927	$	1,327	$	525
Accounts receivable trade – unbilled, end of the period		1,396		914		1,396		914
Amounts invoiced in the period from amounts included at the beginning of the period		549		830		1,189		428

	·	Trade – billed represents amounts that have been invoiced to customers for which the Company has an unconditional right to payment. Trade – billed is presented net of an allowance for expected credit losses.
	·	Trade – unbilled represents amounts related to performance obligations satisfied over time for which revenue has been recognized, but amounts have not yet been invoiced. Trade – unbilled is a contract asset.

The Company’s Accounts receivable trade – billed (in thousands), arising from Topic 606 is $24,785 and $26,618 as of March 31, 2026 and December 31, 2025, respectively.

Certain contracts include retention provisions, generally up to 10%, that are withheld from progress billings until the related work has been completed and approved. Contract retentions that have been invoiced are included within Trade – billed. The Company considers these amounts to be contract balances because collection may be contingent upon contractual completion and approval provisions.

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At March 31,2026 and December 31, 2025, accounts receivable included contract retentions (in thousands) of approximately $1,465 and $1,135, respectively, which are considered contract assets.

For contracts recognized over time, contract assets arise when revenue recognized to date exceeds cumulative billings. Contract assets are presented as Trade – unbilled on our consolidated financial statements. When the Company subsequently invoices the customer, the related amounts are reclassified from Trade – unbilled to Trade – billed.

	Quarter Ended March 31,
	2026		2025
Accounts receivable trade – unbilled, beginning of the period	$	1,173	$	1,327
Accounts receivable trade – unbilled, end of the period		1,836		952
Amounts invoiced in the period from amounts included at the beginning of the period		167		1,060

Projects with performance obligations recognized over time that have cumulative billings in excess of costs and estimate earnings recognized to date, are reported on our Consolidated Balance Sheets as "Customer deposits" (contract liabilities). The Company’s Customer deposits (i.e. contract liabilities) balances are as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

Quarter Ended March 31,

2025

2024

2025

2024

2026

2025

Customer deposits, beginning of the period

2,~~637~~381

21,~~581~~539

~~1,539~~

~~2,779~~

Customer deposits, end of the period

2,~~689~~051

12,~~492~~160

~~2,689~~

~~1,492~~

Revenue recognized in the period from amounts included at the beginning of the period

~~855~~302

21,~~483~~452

~~423~~

~~2,684~~

~~The~~For contracts where the Company’s ~~deferred~~has ~~revenue~~billed ~~balances~~or (received consideration in ~~thousands)~~advance ~~related~~of transferring goods or services to ~~Topic~~the ~~606~~customer, ~~are~~the Company records a contract liability, deferred revenue, within accrued liabilities or other liabilities, as ~~follows:~~applicable, and recognizes revenue when the Company satisfies its performance obligations under the terms of the contract, which generally occurs over time as services are rendered or at a point in time upon delivery of the promised goods or services. Deferred revenue includes the non-lease components of barrier rental arrangements.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Deferred revenue, beginning of the period	$	6,175		3,499	$	4,453	$	2,685
Deferred revenue, end of the period		6,529		4,189		6,529		4,189
Revenue recognized in the period from amounts included at the beginning of the period		796		68		3,331		604

The Company’s deferred revenue (i.e. contract liabilities) balances (in thousands) related to Topic 606 are as follows:

Any uncollected billed amounts for our performance obligations recognized over time, including contract retentions, are recorded within accounts receivable trade - billed. At September 30, 2025 and December 31, 2024 accounts receivable included contract retentions of approximately $1,130 and $1,523, respectively, which are considered contract assets.

	Quarter Ended March 31
	2026		2025
Deferred revenue, beginning of the period	$	6,871	$	4,453
Deferred revenue, end of the period		7,448		5,174
Revenue recognized in the period from amounts included at the beginning of the period		4,095		34

~~Our~~Any uncollected billed ~~and~~amounts ~~unbilled~~for ~~revenue may be exposed to potential credit risk if~~ our ~~customers~~performance ~~should~~obligations ~~encounter~~recognized ~~financial~~over ~~difficulties~~time, ~~and~~including wecontract ~~maintain~~retentions, anare ~~allowance~~the ~~for~~difference ~~estimated~~between ~~expected~~the ~~credit~~opening ~~losses.~~and Aclosing ~~considerable~~balances ~~amount~~ of ~~judgment~~the isCompany’s ~~required~~contract ~~when~~assets ~~determining~~and ~~expected~~contract ~~credit~~liabilities ~~losses.~~primarily ~~Estimates~~results offrom ~~such~~the ~~expected~~timing ~~losses~~difference ~~are~~between ~~recorded based on historical losses experienced by~~ the Company,’s ~~current~~performance ~~macro-~~ and ~~micro-economic conditions, and expected macro- and micro-economic conditions~~billings. ~~Additional~~The ~~reserves~~changes ~~are accumulated when we believe a specific customer may not be able to meet its financial obligations due to deterioration~~ in ~~financial condition or credit rating. Factors relevant to our assessment include our prior collection history with our customers,~~ the ~~related~~contract ~~aging~~assets ofand ~~past~~contract ~~due~~liabilities balances, ~~projections~~during ~~of credit losses based on historical trends or past events, and forecasts of future economic conditions. During~~ the ~~quarter~~quarters ended ~~September 30~~ March 31, 2026 ~~2025, we recognized a bad debt recovery of $245, primarily related to collections of previously reserved receivables. At September 30, 2025~~ and ~~December 31, 2024, total allowances for credit losses~~ 2025 were not materially ~~$1,166~~affected ~~and~~by ~~$1,130,~~any ~~respectively~~other factors.

~~The~~Our ~~roll~~billed ~~forward~~and ofunbilled revenue is subject to credit risk if our customers should encounter financial difficulties. The Company maintains an allowance for estimated expected credit losses on Trade-billed (and evaluates Trade-unbilled for expected credit losses, as applicable). A considerable amount of judgment is required when determining expected credit losses. Estimates of such expected losses are recorded based on historical losses experienced by the ~~quarter~~Company ~~ended~~and ~~September~~current 30and future economic conditions. Management also considers when a specific customer may not be able to meet its financial obligations due to deterioration in financial condition or credit rating. Factors relevant to our assessment include our prior collection history with our customers, ~~2025~~the related aging of past due balances, ~~was~~projections asof ~~follows:~~credit losses based on historical trends or past events, and forecasts of future economic conditions.

Balance at December 31, 2024	$	1,130
Provision for Expected Credit Losses		281
Bad Debt Recovery		(245	)
Balance at September 30, 2025	$	1,166

At March 31, 2026 and March 31, 2025, total allowances for credit losses were $651 and $1,222, respectively (in thousands). The decrease in the allowance for credit losses was primarily attributable to improved collection trends, a reduction in aged receivable balances, particularly within accounts previously identified as having elevated credit risk, and a decline in customer accounts with specific credit concerns that had contributed to higher reserves in the prior year. Management will continue to monitor receivable aging, customer creditworthiness, project-specific risks, and broader economic conditions affecting the construction and infrastructure markets in which the Company operates when estimating expected credit losses.

The rollforward of our allowance for credit losses (in thousands) for the quarters ended March 31, 2026 and 2025, was as follows:

	Quarter Ended March 31,
	2026		2025
Balance at beginning of period	$	539	$	1,130
Provision (benefit) for Expected Credit Losses		112		92
Balance at end of period	$	651	$	1,222

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Barrier Rentals - Lease Income

~~Leasing~~Barrier ~~fees~~Rental ~~are paid by customers at the beginning of the lease agreement. We record amounts billed to customers in excess of recognizable~~ revenue, ashistorically ~~deferred~~comprises ~~revenue~~Standard onBarrier ~~the~~Rental ~~balance sheet. These amounted to $7,944~~ and ~~$6,082~~Special asBarrier ~~of September 30, 2025 and December 31, 2024 respectively~~Projects. ~~Revenue is recognized on a straight-line basis each month as lease income for the duration of the lease, in accordance with Topic 842, Leases.~~

Standard Barrier Rental

The Company leases barriers to customers under operating leases in accordance with ASC 842, Leases. Customers are invoiced at lease commencement for the full lease term. The Company’s standard barrier rentals arrangements are generally for periods less than five years and may include provisions for additional charges if the barriers remain on rent beyond the contractual lease term. The Company evaluates the enforceable term in determining the lease tease term used for revenue recognition and in preparing its disclosure of future fixed lease payments. Amounts billed in advance of the related lease periods are recorded as deferred lease income within Deferred revenue on the balance sheet and recognized as lease income on a straight-line basis over the lease term. Lease income is presented in Barrier Rentals within Revenue in the consolidated financial statements. The Company recognizes operating lease income only to the extent collection is probable. If collectability is not probable, lease income is limited to amounts collected until collectability becomes probable.

Standard Barrier Rental arrangements also include non-lease components (accounted for under ASC 606, Revenue from Contracts with Customers), including delivery/shipping, installation, and removal/pickup services. These non-lease components are distinct from the lease component because: (i) the lease commences upon shipment from the Company’s facility, and delivery and installation occur after lease commencement; (ii) the components are separately priced with observable standalone selling prices; and (iii) the services can be performed by third parties. The Company allocates consideration between lease and non-lease components based on their relative stand-alone selling prices. Revenue allocated to delivery and installation services is recognized when the services are performed (generally upon delivery to the customer’s site, which occurs after lease commencement), and revenue allocated to removal/pickup services is recognized when performed (generally at the end of the lease term). Amounts billed in advance of performance related to the non-lease components are recorded as deferred revenue within Deferred revenue on the balance sheet and recognized as the related services are performed and is recognized within shipping and installation revenue on the consolidated statements of income.

The Company’s deferred lease revenue balances (in thousands) related to Topic 842, Leases are as follows:

	Quarter Ended March 31,
	2026		2025
Deferred lease revenue, beginning of the period	$	8,020	$	6,062
Deferred lease revenue, end of the period		8,307		6,788
Revenue recognized in the period from amounts included at the beginning of the period		1,502		957

Special Barrier Projects

The Company provides barrier rentals as part of integrated Special Barrier Projects, which include deployment and 24/7 concierge-type services. These arrangements are evaluated under ASC 842, Leases. The Company contracts with a third-party event services firm, with the end-user also a party to the arrangement. Projects are delivered as a single bundled engagement, typically over a one- to two-week period.

The Company’s personnel manage and execute all barrier movements under direction of customer authorized staff and officials. Based on this structure, the customer is considered to direct the use of the identified asset, indicating that a lease exists. The non-lease components are not distinct from the lease component, as they are highly interdependent and interrelated and not separately identifiable. Accordingly, the lease and non-lease components are not separated and are accounted for as a single combined component under ASC 842. Revenue is recognized on a straight-line basis over the project term, which reflects the continuous transfer of benefit over the duration of the engagement.

Royalty Income

The Company licenses certain products to other precast companies to produce the Company's products toin ~~engineering~~accordance ~~specifications~~with ~~under~~ the ~~licensing~~Company’s ~~agreements~~engineering specifications. ~~The~~Licensing agreements are typically for five-year terms and require royalty payments ~~from~~of 4% to 6% of the licensee’s total sales of licensed products,. ~~which~~Royalty ~~are~~income ~~paid~~is ~~every~~recognized ~~month.~~in ~~The~~accordance ~~revenues~~with ~~from~~ASC ~~licensing~~606 ~~agreements~~as ~~are~~the ~~recognized~~licensee’s sales of the licensed products occur in the ~~month~~period the licensees’ sales are earned and reported. Royalty income is presented under Royalty Income within Revenue in the consolidated financial statements

Shipping and Installation

Shipping, installation and ~~installation~~removal ~~revenues~~services are ~~recognized~~distinct asperformance aobligations ~~distinct~~and ~~performance~~are ~~obligation~~accounted for under ASC 606, Revenue from Contracts with Customers. Revenue is recognized in the period the shipping, installation, and ~~installation~~removal services are provided to the customer. When shipping and installation services are billed in advance of performance, the Company records a contract liability and recognizes the revenue when the services are performed. Shipping, installation and removal revenue is presented as Shipping and Installation within Revenue in the consolidated financial statements.

Disaggregation of Revenue

In the following table, revenue is disaggregated by primary sources of revenue:

Revenue by Type	Three Months EndedSeptember 30,				Nine Months EndedSeptember 30,
	2025		2024		2025		2024
Soundwall Sales	$	2,846	$	1,873	$	11,832	$	7,043
Architectural Panel Sales		1,033		1,601		1,033		3,893
SlenderWall Sales		1,146		—		2,634		—
Miscellaneous Wall Sales		1,273		811		2,737		4,634
Barrier Sales		764		546		3,299		3,418
Easi-Set Building Sales		2,657		1,801		7,642		4,341
Utility Sales		1,166		2,383		3,051		6,112
Miscellaneous Sales		1,026		1,738		2,231		5,180
Total Product Sales		11,911		10,753		34,459		34,621
Barrier Rentals		3,269		7,053		17,474		9,303
Royalty Income		1,083		958		3,299	2,403
Shipping and Installation Revenue		5,188		4,818		15,103		13,650
Total Service Revenue		9,540		12,829		35,876		25,356
Total Revenue	$	21,451	$	23,582	$	70,335	$	59,977

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~~The~~Disaggregation ~~revenue~~of items: soundwall sales, architectural panel sales, SlenderWall sales, miscellaneous wall sales, miscellaneous sales, barrier rentals, and royalty income are recognized as revenue over time. The revenue items: barrier sales, Easi-Set and Easi-Span building sales, utility sales, and shipping and installation revenue are recognized as revenue at a point in time.Revenue

the following table, revenue is disaggregated by primary sources of revenue (in thousands):

Revenue by Type	Three Months Ended March 31,
	2026		2025
Soundwall Sales	$	3,350	$	3,779
Architectural Panel Sales		750		—
SlenderWall Sales		746		—
Miscellaneous Wall Sales		305		601
Barrier Sales		1,932		1,305
Easi-Set and Easi-Span Building Sales		2,936		2,060
Utility Sales		1,439		1,014
Miscellaneous Product Sales		328		353
Total Product Sales		11,786		9,112
Barrier Rentals		2,201		8,425
Royalty Income		823		890
Shipping and Installation Revenue		6,762		4,271
Total Service Revenue		9,786		13,586

Total Revenue	$	21,572	$	22,698

The revenue items: soundwall sales, architectural sales, SlenderWall® sales, miscellaneous wall sales, miscellaneous sales, barrier rentals, and royalty income are recognized as revenue over time. The revenue items: barrier sales, Easi-Set and Easi-Span building sales, utility sales, and shipping and installation revenue are recognized as revenue at a point in time.

Warranties

Smith-Midland products are typically sold pursuant to an implicit warranty of merchantability only. Warranty claims are reviewed and resolved on a case-by-case method. Although the Company does incur costs for warranty claims, historically such amounts are minimal.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Concentration of Risk

Historically, various customers have comprised greater than 10% of revenue during a given quarter or year. These customers are typically not the same quarter to quarter or year to year. The Company views revenue details by jobs, and not by customers. In the event a customer were to go out of business during a project, it is likely that the owner of the project would assign a new contractor to the job, and the Company would complete its scope of work. Therefore, the Company believes that it does not have a short-term vulnerability of severe impact to operations. In cases where customers are less than 10% of revenue, the Company assesses if there is a near term severe impact. The Company has determined that no customer, if lost, would result in a near term severe impact to the Company’s operations.

For the ~~three~~quarter ~~months~~ ended ~~September~~March 3031, ~~2025~~2026, ~~no customer made up greater than 10% of~~ the ~~revenue for the~~ Company. ~~For~~derived ~~the~~16% ~~nine~~and ~~months ended September 30, 2025, the Company derived 18~~10% of its revenue from ~~one~~each ~~customer~~of two customers. For the ~~three~~quarter ~~months~~ ended ~~September~~March 3031, ~~2024~~2025, the Company derived 1733% of its revenue from one customer. ~~For the nine months ended September 30, 2024 no customer made up greater than 10% of the revenue for the Company.~~ As of ~~September~~March 3031, ~~2025~~2026, ~~one~~each ~~customer~~of two customers’s outstanding receivable balance ~~equaled~~exceeded 1610% of the total outstanding receivable balance. As of ~~September~~March 3031, ~~2024~~2025, ~~one~~each ~~customer~~of two customers’s outstanding receivable balance ~~equaled~~exceeded 1510% of the total outstanding receivable balance.

Segment Reporting

Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the ~~chief~~Chief ~~operating~~Operating ~~decision-maker,~~Decision orMaker ~~decision-making~~(“CODM”) ~~group,~~ in deciding how to allocate resources and assess performance. The Company currently operates in one operating and reportable business segment for financial reporting purposes (the “Precast Concrete Segment”). The Company’s CODM is the Chief Executive Officer (“CEO”) and President.

The Precast Concrete Segment derives revenues from customers by providing products and services to customers. The accounting policies of the precast concrete segment are the same as those described in the summary of significant accounting policies. The CODM assesses performance for the Precast Concrete Segment based on consolidated net income as reported on the consolidated statements of income and measures segment assets as total consolidated assets as reported on the consolidated balance sheets. The CODM uses consolidated net income and consolidated assets to allocate resources and assess performance. Significant segment expenses provided to the CODM are based on the expense breakout shown on the consolidated statements of income. The Precast Concrete Segment’s results are the same as reported on the consolidated statements of income and there are no adjustments or reconciling items.

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2. EARNINGS PER SHARE

Earnings per share are calculated as follows (in thousands, except earnings per share):

	Three Months Ended September 30,				Nine Months Ended September 30,
	Three Months Ended March 31,
	2025		2024		2025			2024
	2026		2025
Basic earnings per common share
Net income	$	21,~~877~~339	$	3,~~150~~327	$	~~10,375~~		$	~~6,278~~
Weighted average shares outstanding		5,~~305~~307		5,304		~~5,305~~			~~5,283~~
Basic earnings per common share	$	0.5425	$	0.5963	$	~~1.96~~		$	~~1.18~~
Diluted earnings per common share
Net income	$	21,~~877~~339	$	3,~~150~~327	$	~~10,375~~		$	~~6,278~~
Weighted average shares outstanding		5,~~305~~307		5,304		~~5,305~~			~~5,283~~
Dilutive effect of restricted stock		—-		—1		(1	)		—
Total weighted average shares outstanding		5,~~305~~307		5,~~304~~305		~~5,304~~			~~5,283~~
Diluted earnings per common share	$	0.5425	$	0.5962	$	~~1.96~~		$	~~1.18~~

There was no restricted stock excluded from the diluted earnings per share calculation for the three ~~and nine~~ month periods ended ~~September~~March 3031, ~~2025~~2026 and ~~September~~March 3031, ~~2024~~2025.

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3. NOTES PAYABLE

The Company has a mortgage note payable to Burke & Herbert Bank & Trust Company, formerly Summit Community Bank (the “Bank”), for the construction of its North Carolina facility. The note carries a ten-year term at a fixed interest rate of 3.64% annually per the Promissory Note Rate Conversion Agreement, with monthly payments of $22, and is secured by all of the assets of Smith-Carolina and a guarantee by the Company. The balance of the note payable at ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025 was $~~980~~884 and $~~1,166~~942 respectively. ~~The loan matures on October 10, 2029.~~

The Company also has a note payable to the Bank in the amount of $1,~~342~~211 and $1,~~536~~279 as of ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025 respectively. The loan is collateralized by a first lien position on the Midland, VA plant, building, and assets. The interest rate per the Promissory Note is fixed at 3.99% per annum, with principal and interest payments payable monthly in the amount of $27. The loan matures on March 27, 2030.

On February 10, 2022, the Company completed the financing for its acquisition of certain real property in Midland, VA from the fourth quarter of 2021, totaling approximately 29.8 acres, with a note payable to the Bank. The loan is collateralized by a first lien position on the related real property. The interest rate is fixed at 4.09% per annum, with principal and interest payments payable monthly over 180 months for $21. The loan matures on February 10, 2037. The balance of the note payable on ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025 was $2,~~264~~186 and $2,~~379~~226 respectively.

~~The~~Under ~~Company~~the ~~additionally~~loan ~~has~~covenants ~~one~~with ~~smaller~~the ~~installment~~Bank, ~~loan~~the ~~with~~Company anmust ~~annual~~maintain ~~interest~~tangible ~~rate~~net worth of 2$25,000.~~90%~~ ~~maturing~~The previous covenant in ~~2025,~~which ~~with~~the aCompany ~~balance~~was atlimited ~~September~~to 30annual capital expenditures of $5,000 ~~2025~~has ~~and~~been ~~December~~discontinued 31effective January 1, ~~2024~~2026. ~~totaling~~The $4Company ~~and~~is ~~$13~~in ~~respectively~~compliance with all covenants pursuant to the loan agreements as of March 31, 2026.

~~Under~~In addition to the ~~loan~~notes ~~covenants~~payable discussed above, the Company has a revolving line of credit evidenced by promissory note with the Bank, with the ~~Company~~available amount of $5,000 with no balance outstanding as of March 31, 2026 and December 31, 2025. The line of credit is ~~limited~~evidenced toby a commercial revolving promissory note, which carries a variable interest rate of prime, with a floor of 4.99%. The line of credit was renewed on January 1, 2026 and matures May 1, 2027. The line of credit renewal excluded the previous limitation on annual capital expenditures. The amount available is based on the lower of the maximum $5,000 or 50% of eligible cash, inventory, and ~~must~~accounts ~~maintain~~receivable ~~tangible~~balances ~~net~~at ~~worth~~the offinancial ~~$25,000~~statement date. ~~The~~Key ~~Company~~provisions isof inthe ~~compliance~~line ~~with~~of credit require the Company to maintain a (i) Minimum Debt Service Coverage Ratio of 1.25x, tested annually,(ii) Minimum tangible net worth ~~loan~~of ~~covenant~~$25 million and ~~has~~(iii) ~~received~~Debt-to-tangible ~~waivers~~net ~~from~~worth ~~the~~not ~~Bank~~greater ~~for~~than ~~the~~3 ~~capital~~to ~~expenditure~~1 ~~loan~~tested ~~covenant~~annually. The asline of ~~September~~credit 30is collateralized by a first lien position on the Company's accounts receivable, ~~2025~~inventory, and ~~December~~equipment. The Company is in compliance with all covenants as of March 31, ~~2024~~2026.

In addition to the notes payable discussed above, the Company has a revolving line of credit evidenced by promissory note with the Bank, with the available amount of $5,000 with no balance outstanding as of September 30, 2025 and December 31, 2024. The line of credit is evidenced by a commercial revolving promissory note, which carries a variable interest rate of prime, with a floor of 4.99%. The line of credit was renewed on January 1, 2025 and matures January 1, 2026. The amount available is based on the lower of the maximum $5,000 or 50% of eligible cash, inventory, and accounts receivable balances at the financial statement date. Key provisions of the line of credit require the Company (i) to obtain bank approval for capital expenditures in excess of $5,000 during the term of the loan and (ii) to obtain bank approval prior to its funding of any acquisition. The line of credit is collateralized by a first lien position on the Company's accounts receivable, inventory, and equipment.

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4. STOCK COMPENSATION

The fair value of restricted stock awards is estimated to be the market price of the Company's common stock at the close of the date of grant. Restricted stock activity during the ~~nine~~three months ended ~~September~~March 3031, 2025, is as follows:

	Performance-Based		Service-Based			Number of Shares			Weighted Average Grant Date Fair Value per Share
Non-vested, December 31, 2024		—		1,000			1,000		$	19.15
Non-vested, December 31, 2025		—		—			—			—
Granted		—		—408			—408			—36.77
Vested (Settled)		—		(1,000	)		(1,000	)	$	19.15
Vested		—		(408	)		(408	)		36.77
Forfeited		—		—			—			—
Non-vested, September 30, 2025		—		—			—			—
Non-vested, March 31, 2026		—		—			—			—

InDuring ~~2021,~~ the Compensation Committee and Board of Directors approved a Long-Term Incentive Plan with respect to the grant of stock pursuant to the 2016 Equity Incentive Plan. The final equity amount earned was based on continued service through the three~~-year~~ ~~performance~~months ~~period~~ended ~~ending~~March ~~on December~~ 31, ~~2023~~2026, ~~Board~~the ~~discretion,~~Company ~~and~~granted ~~performance~~408 ~~results.~~fully ~~The~~vested ~~actual number of performance~~service-based ~~shares~~restricted ~~of common~~ stock ofawards to the Company,’s ifChief ~~any,~~Financial ~~earned~~Officer bywith ~~the~~a ~~award~~grant-date ~~recipients~~fair ~~was~~value ~~determined~~of ~~based~~$36.77 onper ~~measures that include Earnings Before Interest Taxes Depreciation and Amortization (“EBITDA”) margin~~share, ~~revenue~~resulting ~~growth,~~in ~~and~~total ~~free~~stock ~~cash~~compensation ~~flow.~~expense ~~The~~of ~~EBITDA~~approximately ~~margin~~$15 ~~and~~thousand ~~revenue~~recognized ~~growth~~during ~~performance targets were set for each of~~ the ~~Minimum, Target, and Maximum levels~~period.

~~Awards are being amortized to expense ratably, based upon the vesting schedule. Stock compensation for the three and nine month periods ended September 30, 2025 was approximately $5 and $~~14, ~~respectively,~~Table ~~based upon the value at the date~~ of grant. During the nine months ended September 30, 2025, 1,000 shares of service-based restricted stock vested and were settled through the issuance of common stock. No new restricted stock awards were granted, and no awards were forfeited during the period. As of September 30, 2025, there were no non-vested restricted stock awards outstanding, and no unrecognized compensation cost related to restricted stock awards.Contents

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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This Quarterly Report and related documents include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act 1934. Forward-looking statements involve known and unknown risks, uncertainties and other factors which could cause the Company’s actual results, performance (financial or operating), or achievements expressed or implied by such forward looking statements not to occur or be realized. Such forward looking statements generally are based upon the Company’s best estimates of future results, performance or achievement, based upon current conditions and the most recent results of operations. Forward-looking statements may be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “believe,” “estimate,” “anticipate,” “continue,” or similar terms, variations of those terms or the negative of those terms. Potential risks and uncertainties include, among other things, such factors as:

· while the Company had net income for the three and nine month periods ended September 30, 2025 and the years ended December 31, 2024 and 2023 there are no assurances that the Company can remain profitable in future periods; in line with this risk, the Company incurred a loss from operations for the quarter ended June 30, 2023, · while we have expended significant funds in recent years to increase manufacturing capacity and the barrier rental fleet, and plan to continue to increase manufacturing capacity and the barrier rental fleet, there is no assurance that we will achieve significantly greater revenues, · while we have special barrier projects that can occur at any time that may have a significant positive effect on revenues and operating income, including the significant special barrier projects that occurred in both the first quarter and the second quarter of 2025 and third quarter of 2024, there can be no assurance of these projects recurring in any future periods, · we have a substantial amount of debt and our ability to satisfy and meet our debt obligations cannot be assured, · while our cash increased during the third quarter of 2025 from December 31, 2024, reflecting the higher cashflows from operating activities, there can be no assurance that the Company’s cash will continue to increase or not be reduced in the future, · we have a significant amount of accounts receivables which has increased during the third quarter of 2025 as compared to the ending balance as of December 2024, and our ability to fully collect these balances cannot be assured,

	●	while we have expended significant funds in recent years to increase manufacturing capacity and the barrier rental fleet, and plan to continue to increase manufacturing capacity and the barrier rental fleet, there is no assurance that we will achieve significantly greater revenues,

	●	while we have special barrier projects that can occur at any time that may have a significant positive effect on revenues and operating income, including the significant special barrier projects that occurred in both the first quarter and the second quarter of 2025, there can be no assurance of these projects recurring in any future periods; likewise the lack of a special barrier projects in any quarter will negatively impact revenues and operating income of such quarter relative to comparison to a quarter that includes a special barrier project. The Company, in view of significant revenues from special barrier projects in 2025, experienced a decrease from this revenue source and a substantial decrease in operating income in the first quarter of 2026 as compared to the first quarter of 2025, which had a significant special barrier project. Likewise, we expect that the revenue and operating income in the second quarter of 2026 will not compare favorably to the second quarter of 2025 due to the anticipated lack of a special barrier project in the 2026 period.

16● ~~Table~~while our cash increased as of ~~Contents~~March 31, 2026 from December 31, 2025, reflecting higher cash flows from operating activities, there can be no assurance that the Company’s cash will continue to increase or not be reduced in the future,

·● we ~~identified~~have material weaknesses in internal controls over financial reports related to (i) design and maintenance of effective controls over the financial reporting process; and (ii) certain business processes and the information control environment. The Company is currently taking remedial actions with respect to these weaknesses, · there are uncertainties arising from the policies of the United States Government, including without limitation, government spending cuts and tariffs, and there can be no assurance that infrastructure spending will not be adversely affected or that the Company will not otherwise be adversely affected, · the Company had a gap in hiring a Chief Financial Officer from July 17, 2024 to April 16, 2025 and is otherwise in need of additional accounting personnel, · our future revenue growth depends in part on future government spending on infrastructure, and there can be no assurance that such spending will occur or be in significant ~~amounts,~~amount ~~· the continued availability~~ of ~~financing~~accounts inreceivables the amounts, at the times, and on the terms required, to support our future business and capital projects, · cybersecurity incidents could disrupt business operations, result in the loss of critical and confidential information and adversely impact our reputation and results of operations; in this respect, we experienced a ransomware incident in the first quarter of 2025 which ~~continues~~has toincreased beduring ~~addressed~~2026 ~~with~~as ~~network~~compared ~~security changes and for which no ransomware payment was made, · the extent~~ to which we are successful in developing, acquiring, licensing, or securing patents for proprietary products, · changes in economic conditions specific to any one or more of our markets (including tariffs, the ~~availability~~ending ofbalance ~~public funds and grants for construction), · the Company’s operations in 2025 and 2024 were adversely impacted by inflation in the purchase of raw materials such~~ as cement and aggregates, steel, and also with labor costs, · changes in general economic conditions in our primary service areas, · adverse weather, which inhibits the demand for our products, or the installation or completion of ~~projects,~~December ~~· our compliance with governmental regulations~~31, ~~· The outcome of future litigation, if any; in this respect, during the third quarter of~~ 2025, ~~we received an arbitration settlement of $458 related to a SlenderWall sale that occurred in 2015. The settlement included the recovery of previously reserved receivables~~ and ~~is recognized in the third quarter of 2025. There can be no assurance we will achieve favorable outcomes in any future litigation, arbitration, or similar proceedings, · potential decreases in~~ our ~~contract backlog; in this respect, the Company’s backlog at November 1, 2025 was approximately $54.8 million as compared to $62.8 million at around the same time a year ago. · our~~ ability to ~~produce~~fully ~~and~~collect ~~install~~these ~~product~~balances oncannot ~~material~~be ~~construction projects that conforms to contract specifications and in a time frame that meets the contract requirements~~assured, · the cyclical nature of the construction industry, · our exposure to increased interest expense payments should interest rates change, and · the other factors and information disclosed and discussed in other sections of this report, in our Annual Report on Form 10-K, and other filings with the Securities and Exchange Commission.

●

cybersecurity incidents could disrupt business operations, result in the loss of critical and confidential information and adversely impact our reputation and results of operations; in this respect, we experienced a ransomware incident in the first quarter of 2025 for which no ransomware payment was made and which continues to be addressed with notifications to potentially impacted internal and external parties and relevant governmental offices as well as enacting network security improvements,

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●

we identified material weaknesses in internal controls over financial reports related to (i) design and maintenance of effective controls over the financial reporting process; and (ii) certain business processes and the information control environment. The Company is currently taking remedial actions with respect to these weaknesses,

	●	there are uncertainties arising from the policies of the United States Government, including without limitation, government spending cuts and tariffs, and there can be no assurance that infrastructure spending will not be adversely affected or that the Company will not otherwise be adversely affected,
	●	There is a need for the continued availability of adequate staffing for financial reporting and internal controls. The Company had a gap in hiring a Chief Financial Officer from July 17, 2024 to April 16, 2025 and experienced the resignation of the Accounting Manager in February 2026 which, although both positions have been filled, negatively delayed the Company’s closing and reporting cycles in order to maintain reporting integrity and data accuracy,
	●	our future revenue growth depends in part on future government spending on infrastructure, and there can be no assurance that such spending will occur or be in significant amounts,
	●	the continued availability of financing in the amounts, at the times, and on the terms required, to support our future business and capital projects,
	●	potential decreases in our contract backlog; in this respect, the Company’s backlog at May 11, 2026 was approximately $48.1 million as compared to $52.4 million at around the same time a year ago,
	●	the extent to which we are successful in developing, acquiring, licensing, or securing new patents for proprietary products as the Company experiences the expiration of certain patents,

●

changes in economic conditions specific to any one or more of our markets (including tariffs, the availability of public funds and grants for construction),

●

the Company’s operations in the first quarter of 2026, and the years 2025 and 2024 were adversely impacted by inflation in the purchase of raw materials such as cement and aggregates, steel, and also with labor costs,

●

changes in general economic conditions in our primary service areas,

●

adverse weather, which inhibits the demand for our products, or the installation or completion of projects,

●

our compliance with governmental regulations,

●

the outcome of future litigation, if any; in this respect, during the third quarter of 2025, we received an arbitration settlement of $458 thousand related to a SlenderWall® sale that occurred in 2015. The settlement included the recovery of previously reserved receivables and is recognized in the third quarter of 2025. There can be no assurance we will achieve favorable outcomes in any future litigation, arbitration, or similar proceedings,

●

our ability to produce and install product on material construction projects that conforms to contract specifications and in a time frame that meets the contract requirements,

●

the cyclical nature of the construction industry,

●

our exposure to increased interest expense payments should interest rates change, and

●

the other factors and information disclosed and discussed in other sections of this report and other filings with the Securities and Exchange Commission.

Investors and shareholders should carefully consider such risks, uncertainties and other information, disclosures and discussions that contain cautionary statements identifying important factors that could cause actual results to differ materially from those provided in the forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

1716 Table of Contents

Overview

The Company invents, develops, manufactures, markets, leases, licenses, sells, and installs a broad array of precast concrete products and systems for use primarily in the construction, highway, utilities, and farming industries. The Company's customers are primarily general contractors and federal, state, and local transportation authorities located in the Mid-Atlantic and Northeastern regions and in parts of the Midwestern and Southeastern regions of the United States. The Company's operating strategy has involved producing innovative and proprietary products, including SlenderWall™, a ~~patented,~~ lightweight, energy-efficient concrete and steel exterior insulated wall panel for use in building construction; J-J Hooks® Highway Safety Barrier, a positive-connected highway safety barrier; and Easi-Set® transportable concrete buildings~~, also patented~~. In addition, the Company produces custom order precast concrete products with various architectural surfaces, as well as generic highway sound barriers, utility vaults, and farm products such as cattleguards.

The Company was incorporated in Delaware on August 2, 1994. Prior to a corporate reorganization completed in October 1994, the Company conducted its business primarily through Smith-Midland Virginia, which was incorporated in 1960 as Smith Cattleguard Company, a Virginia corporation, and subsequently changed its name to Smith-Midland Corporation in 1985. The Company’s principal offices are located at 5119 Catlett Road, Midland, Virginia 22728 and its telephone number is (540) 439-3266. As used in this report, unless the context otherwise requires, the term the “Company” refers to Smith-Midland Corporation and its subsidiaries.

As a part of the construction industry, the Company's sales and net income may vary greatly from quarter to quarter over a given year. Because of the cyclical nature of the construction industry, many factors not under our control, such as weather and project delays, affect the Company's production schedule, possibly causing momentary slowdowns in sales and net income. In addition, revenues are affected by the number, size, and timing of significant projects to which the Company is contracted. As a result of these factors, the Company is not always able to earn a profit for each period, therefore, please read Management's Discussion and Analysis of Financial Condition and Results of Operations and the accompanying financial statements with these factors in mind.

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Results of Operations (dollar amounts in thousands, except per share data)

Overall, the Company’s financial ~~bottom line~~ performance ~~was higher~~ for the first ~~nine~~quarter ~~months~~ of ~~2025~~2026 ~~when~~decreased compared to the first ~~nine~~quarter ~~months~~ of ~~2024~~2025. The Company ~~had~~reported net income of $1,339 for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2025 of $2~~2026,~~877~~ ~~and $10,375, respectively,~~ compared to a net income of $3,~~150~~327 ~~and $6,278~~ for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024, respectively~~2025. Total revenue ofdecreased by $211,~~451~~126 ~~was~~to $221,~~131~~572 ~~lower~~ for the three months ended ~~September~~March 3031, ~~2025~~2026 from $2322,~~582~~698 for the three months ended ~~September~~March 3031, ~~2024~~2025. The ~~lower~~decrease ~~revenue~~ in ~~the~~revenue ~~third quarter of 2025 when compared to the third quarter of 2024~~ was ~~due~~ primarily attributable to alower ~~special~~ barrier ~~project~~rental ~~that occurred in the third quarter of 2024 that did not recur in the third quarter of 2024. Total~~ revenue ~~increased~~resulting ~~by $10,358 to $70,335 for the nine months ended September 30, 2025~~ from ~~$59,977 for~~ the ~~nine~~absence ~~months~~of ~~ended~~a ~~September~~large ~~30, 2024. The increase in revenue for the nine month period is mainly from~~ special barrier project ~~sales~~ that ~~occurred~~positively inimpacted the first ~~and~~quarter ~~second quarters~~ of 2025,. anThis ~~increase~~decrease inwas ~~soundwall~~partially ~~sales,~~offset ~~SlenderWall~~by ~~sales,~~increases ~~Easi-Set~~in ~~building~~product sales, ~~royalty income,~~ and shipping and installation revenue.

Cost of sales as a percentage of revenue, excluding royalties, increased to 83% for the three months ended March 31, 2026 compared to 72% for the three months ended March 31, 2025. The increase was primarily due to the significant reduction in special project barrier rental revenue during the quarter. Special barrier rental projects generally carry higher margins and lower cost of sales percentages compared to product sales.

Operating income was $1,728 for the three month period ended March 31, 2026, as compared to $4,387 for the three month period ended March 31, 2025. Operating expenses for the first quarter of 2026 were $2,575 compared to $2,588 for the first quarter of 2025. The slight decrease was primarily attributable to lower selling expenses partially offset by higher general and administrative expenses.

Income tax expense for the three month period ended March 31, 2026 was $422, or an effective tax rate of 24%, as compared to $1,020, or an effective tax rate of 24% for the three month period ended March 31, 2025.

As of May 11, 2026, the Company’s sales backlog was approximately $48.1 million, as compared to approximately $52.4 million around the same time in the prior year. It is estimated that most of the projects in the current sales backlog will be produced within 12 months, but a few will be produced over multiple years. The Company anticipates funding related to the Infrastructure Investment and Jobs Act to continue to support growth opportunities in highway, transportation, and infrastructure markets in 2026 and beyond, although no assurance can be provided. The Company continues to focus marketing and sales efforts toward SlenderWall® products and barrier rentals in line with long-term strategic objectives.

Three months ended March 31, 2026, compared to the three months ended March 31, 2025

Revenue includes product sales, barrier rentals, royalty income, and shipping and installation revenues. Product sales are further divided into soundwall, architectural and SlenderWall® panels, miscellaneous wall panels, highway barrier, Easi-Set® and Easi-Span buildings, utility products, and miscellaneous precast products. The following table summarizes the sales by product type and comparison for the three month periods ended March 31, 2026 and 2025.

Revenue by Type	Three Months Ended March 31,
	2026		2025		Change			% Change
Soundwall Sales	$	3,350	$	3,779	$	(429	)		(11	)%
Architectural Panel Sales		750		—		750			100	%
SlenderWall Sales		746		—		746			100	%
Miscellaneous Wall Sales		305		601		(296	)		(49	)%
Barrier Sales		1,932		1,305		627			48	%
Easi-Set and Easi-Span Building Sales		2,936		2,060		876			43	%
Utility Sales		1,439		1,014		425			42	%
Miscellaneous Product Sales		328		353		(25	)		(7	)%
Total Product Sales		11,786		9,112		2,674			29	%
Barrier Rentals		2,201		8,425		(6,224	)		(74	)%
Royalty Income		823		890		(67	)		(8	)%
Shipping and Installation Revenue		6,762		4,271		2,491			45	%
Total Service Revenue		9,786		13,586		(3,800	)		(25	)%

Total Revenue	$	21,572	$	22,698	$	(1,126	)		(5	)%

The revenue items: soundwall sales, architectural panel sales, SlenderWall sales, miscellaneous wall sales, miscellaneous sales, barrier rentals, and royalty income are recognized as revenue over time. The revenue items: barrier sales, Easi-Set® and Easi-Span building sales, utility sales, and shipping and installation revenue are recognized as revenue at a point in time.

Soundwall Sales - Soundwall sales decreased for the three month period ended March 31, 2026 compared to the three month period ended March 31, 2025. The decrease was primarily due to timing of project production schedules and shipment activity. The Company continues to maintain a soundwall backlog and expects production activity to increase throughout the remainder of 2026, although no assurance can be given.

Architectural Panel Sales – Architectural panel sales increased for the three month period ended March 31, 2026 compared to the three month period ended March 31, 2025 due to the commencement of architectural panel production activity during the quarter. The Company expects architectural panel activity to continue throughout 2026 and trend higher than 2025 production levels, although no assurance can be given.

SlenderWall Sales – The Company had no SlenderWall® sales in the three month period ended March 31, 2025 to compare to the production levels for the three month period ended March 31, 2026. Due to the commencement of production on certain SlenderWall® projects and sales expectations in 2026, the Company expects sales for the remainder of the year in this category to be consistent with the quarter ended March 31, 2026. The Company continues to focus sales and marketing initiatives on SlenderWall®, although no assurance can be provided regarding future project awards or production timing.

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~~Cost~~Miscellaneous ofWall Sales – Miscellaneous wall sales asare ahighly ~~percentage~~customized ofprecast ~~revenue,~~concrete ~~not~~products ~~including~~or ~~royalties,~~retaining ~~increased~~and tolagging ~~77%~~panels ~~for~~that ~~the~~do ~~three~~not ~~months~~fit ~~ended~~other ~~September~~product ~~30,~~categories. ~~2025~~Miscellaneous ~~compared~~wall tosales ~~75%~~decreased for the three ~~months~~month period ended ~~September~~March 3031, ~~2024.~~2026 ~~The increase for the third quarter of 2025 as~~ compared to the ~~same~~three ~~quarter~~month inperiod ~~2024~~ended isMarch 31, 2025 primarily due to ~~the~~normal ~~increase~~fluctuations in ~~revenue from a special barrier~~ project ~~that~~timing ~~was performed in the third quarter of 2024 which have a higher margin~~ and ~~lower cost of sales when compared to~~ product ~~margin and product cost of sales~~mix. ~~Cost~~ ofBased ~~sales~~on ~~as a percentage of revenue, not including royalties, decreased to 74% for~~ the ~~nine~~Company’s ~~months~~backlog ~~ended September 30, 2025 compared to 77%~~ for ~~the~~these ~~nine months ended September 30~~products, ~~2024.~~miscellaneous ~~The~~wall ~~decrease~~sales ~~for~~are ~~the~~expected ~~nine month period is primarily due~~ to ~~the~~trend ~~increase~~lower inthrough ~~revenue from~~ the ~~special~~remainder ~~barrier projects that were performed in the first and second quarters~~ of ~~2025~~2026 ~~which~~as ~~have a higher margin and lower cost of sales when~~ compared to ~~product margin and product cost of sales~~2025. .

~~Operating~~Barrier ~~income~~Sales ~~was~~- ~~$3,854~~Barrier sales increased for the three month period ended ~~September~~March 3031, ~~2025,~~2026 as compared to ~~an operating income of $3,848 for~~ the three month period ended ~~September~~March 3031, ~~2024. Operating income was $13,759 for the nine month period ended September 30,~~ 2025, asdue ~~compared~~ to ~~$8,031~~increased ~~for~~customer ~~the nine month period ended September 30, 2024~~demand. Sales ~~Operating~~in ~~expenses~~this ~~for~~category ~~the~~are ~~third~~expected ~~quarter~~to oftrend ~~2025~~lower ~~were~~throughout ~~$1,905~~2026 as compared to ~~$2,730 for the third quarter of 2024~~2025. ~~Operating~~The ~~expenses~~Company ~~for~~continues ~~the~~to ~~first~~focus ~~nine~~strategically ~~months~~on ofbarrier ~~2025~~rental ~~were~~opportunities ~~$6,761~~in ~~compared~~certain togeographic ~~$7,593~~regions ~~for~~while ~~the~~maintaining ~~first~~selective ~~nine~~barrier ~~months~~sales ~~of 2024~~activity.

~~Income~~Easi-Set® ~~tax~~and ~~expense~~Easi-Span ~~for~~Building ~~the~~Sales ~~three~~– ~~month~~Building ~~period~~sales ~~ended~~increased ~~September~~significantly ~~30, 2025 was $994, or an effective tax rate of 26%, as compared to an income tax expense of $694, or an effective tax rate of 18%~~ for the three month period ended ~~September~~March 3031, ~~2024.~~2026 ~~Income~~compared ~~tax~~to ~~expense for~~ the ~~nine~~three month period ended ~~September~~March 3031, 2025 ~~was~~due ~~$3,325,~~to orincreased ancustomer ~~effective~~demand ~~tax~~at ~~rate~~multiple ofmanufacturing ~~24%,~~facilities. asThe ~~compared~~Company toexpects anbuilding ~~income~~sales ~~tax~~activity ~~expense~~to ofcontinue ~~$1,683~~at orelevated anlevels ~~effective~~during ~~tax~~2026, ~~rate~~although ofno ~~21%~~assurance ~~for~~can ~~the~~be ~~nine month period ended September 30, 2024~~given.

AsUtility ofSales ~~November~~– 1,Utility ~~2025,~~sales ~~the~~increased ~~Company’s~~for ~~sales~~the ~~backlog~~three ~~was~~month ~~approximately~~period ~~$54.8~~ended ~~million~~March 31, as2026 compared to ~~approximately $62.8 million around~~ the ~~same~~three ~~time~~month inperiod ~~the~~ended ~~prior~~March ~~year.~~31, It2025, isreflecting ~~estimated~~increased ~~that~~demand ~~most of the projects~~ in ~~the~~utility ~~current~~and ~~sales~~infrastructure-related ~~backlog will be produced within 12 months~~markets, ~~but~~including acontinued ~~few~~data ~~will~~center bedevelopment ~~produced~~activity ~~over~~in ~~multiple~~Northern ~~years~~Virginia. The Company ~~anticipates~~expects ~~funding~~utility ~~related~~sales toactivity ~~the Infrastructure Investment and Jobs Act~~ to continue ~~coming~~ through the ~~state~~remainder ~~and local governments in the latter half~~ of ~~2025~~2026 and ~~beyond~~trend tohigher ~~further~~than ~~promote~~2025 ~~growth~~production ~~in the revenue related to the highway~~levels, ~~transportation, and infrastructure markets,~~ although no assurance can be ~~provided~~given. ~~The Company continues to increase marketing and sales efforts towards SlenderWall sales and barrier rentals, in line with long-term strategic objectives.~~

Miscellaneous Product Sales - Miscellaneous products are products that are produced or sold that do not meet the criteria defined for other revenue categories. Examples would include precast concrete slabs, concrete blocks, or small add-on items. Miscellaneous product sales decreased for the three month period ended March 31, 2026, compared to the three month period ended March 31, 2025. Miscellaneous product sales are expected to trend lower through the remainder of 2026 as compared to 2025, although no assurance can be provided.

Barrier Rentals – Barrier rental revenue decreased significantly for the three month period ended March 31, 2026 compared to the three month period ended March 31, 2025. The decrease was primarily attributable to the absence of a large special barrier project that positively impacted the first quarter of 2025. Excluding special projects, the Company expects standard barrier rental activity to continue to trend positively throughout 2026, although no assurance can be provided. The Company also expects, to a lesser degree, special barrier projects to continue in 2026. In view of the anticipated lack of a special barrier project in the second quarter of 2026 as compared to one such project in the second quarter of 2025, the Company expects a significant decrease in such revenues for the 2026 second quarterly period.

Royalty Income – Royalty income decreased slightly for the three month period ended March 31, 2026 compared to the three month period ended March 31, 2025 due a large project which generated higher royalties from one licensee in the first quarter of 2025 that did not recur in the first quarter of 2026. The Company continues to expect long-term royalty opportunities associated with infrastructure spending and continued utilization of the J-J Hooks® barrier system. The Company expects royalties for 2026 to trend higher for the full year 2026, although no assurance can be given.

Shipping and Installation – Shipping revenue results from shipping our products to the customers' final destination and is recognized when the shipping services take place. Installation activities include installation of our products at the customers’ construction site. Installation revenue results when attaching architectural wall panels to a building, installing an Easi-Set® or Easi-Span building at a customers' site, setting highway barrier, or setting any of our other precast products at a site specific to the requirements of the owner. Shipping and installation revenue increased for the three month period ended March 31, 2026 compared to the same period in 2025 primarily due to increased product sales, including building, utility, and barrier products.

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~~Three~~Cost ~~and~~of ~~nine~~Sales - Total cost of sales as a percentage of revenue, excluding royalties, for the three months ended ~~September~~March 3031, ~~2025~~2026 was 83%, as compared to 72% for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024~~ 2025. The increase in cost of sales as a percentage of revenue was primarily due to the reduction in high-margin special barrier project revenue during the first quarter of 2026 as compared to the first quarter of 2025 as well as the relative increase in lower-margin product sales activity.

~~Revenue~~General ~~includes~~and ~~product~~Administrative ~~sales,~~Expenses ~~barrier~~- ~~rentals,~~For ~~royalty~~the ~~income~~three months ended March 31, ~~and~~2026, ~~shipping~~the Company’s general and ~~installation~~administrative ~~revenues.~~expenses ~~Product~~increased ~~sales~~by ~~are~~$169 ~~further~~to ~~divided~~$1,753 ~~into~~from ~~soundwall~~$1,584 ~~architectural~~during ~~and~~the ~~SlenderWall™~~three ~~panels,~~month ~~miscellaneous~~period ~~wall~~ended ~~panels~~March 31, ~~highway~~2025. ~~barrier,~~The ~~Easi~~increase was primarily attributable to increased personnel-~~Set®~~related ~~buildings~~costs, ~~utility~~professional ~~products~~fees, and ~~miscellaneous~~costs ~~precast~~associated ~~products~~with internal control and financial reporting remediation activities. ~~The~~General ~~following~~and ~~table~~administrative ~~summarizes~~expense ~~the~~as ~~sales~~a bypercentage ~~product~~of ~~type~~total revenue was 8% and ~~comparison~~7% for the three ~~and nine~~ month periods ended ~~September~~March 3031, ~~2025~~2026 and ~~2024~~2025, respectively.

Revenue by Type	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Soundwall Sales	$	2,846	$	1,873	$	11,832	$	7,043
Architectural Panel Sales		1,033		1,601		1,033		3,893
SlenderWall Sales		1,146		—		2,634		—
Miscellaneous Wall Sales		1,273		811		2,737		4,634
Barrier Sales		764		546		3,299		3,418
Easi-Set Building Sales		2,657		1,801		7,642		4,341
Utility Sales		1,166		2,383		3,051		6,112
Miscellaneous Sales		1,026		1,738		2,231		5,180
Total Product Sales		11,911		10,753		34,459		34,621
Barrier Rentals		3,269		7,053		17,474		9,303
Royalty Income		1,083		958		3,299		2,403
Shipping and Installation Revenue		5,188		4,818		15,103		13,650
Total Service Revenue		9,540		12,829		35,876		25,356
Total Revenue	$	21,451	$	23,582	$	70,335	$	59,977

Selling Expenses - Selling expenses for the three months ended March 31, 2026 decreased to $822 from $1,004 for the three month period ended March 31, 2025. The decrease was primarily attributable to lower commission expense associated with reduced barrier rental revenues. As a percentage of sales, selling expense was 4% and 5% for the three month periods ended March 31, 2026 and 2025, respectively. The Company continues to expect selling expenses to increase for the remainder of 2026 as compared to 2025 based on the plan for additional sales associates and increased advertising spending aligning with the strategy to increase SlenderWall® sales and barrier rentals.

Operating Income - The ~~revenue~~Company ~~items:~~had ~~soundwall~~operating ~~sales,~~income ~~architectural~~for ~~panel~~the ~~sales,~~three ~~SlenderWall~~month ~~sales,~~period ~~miscellaneous~~ended ~~wall~~March ~~sales~~31, ~~miscellaneous~~2026 ~~sales~~of $1,728 ~~barrier~~compared ~~rentals~~to $4,387 ~~and~~for ~~royalty~~the ~~income~~three ~~are~~month ~~recognized~~period asended ~~revenue~~March ~~over~~31, ~~time~~2025. The ~~revenue~~61% ~~items:~~decrease was primarily attributable to lower revenues from the absence of a significant special barrier ~~sales~~project, ~~Easi-Set~~which ~~and~~occurred ~~Easi-Span~~the ~~building~~first ~~sales,~~quarter ~~utility~~of ~~sales,~~2025 and ~~shipping~~did not occur in the first quarter of 2026, and ~~installation~~the ~~revenue~~resulting ~~are~~increase ~~recognized~~in ascost ~~revenue~~of atsales as a ~~point~~percentage inof ~~time~~revenue.

~~Soundwall~~Interest ~~Sales~~Expense - ~~Soundwall~~Interest ~~sales~~expense ~~were~~was ~~significantly~~$47 ~~higher~~and $55 for the three ~~and nine~~ month periods ended ~~September~~March 3031, 2026 and 2025, ~~compared to the same periods in 2024~~respectively. The ~~increase~~decrease iswas ~~due~~primarily attributable to ~~higher~~lower ~~production~~outstanding ~~volumes~~indebtedness atbalances ~~all~~during ~~three~~2026. ~~plants,~~The ~~as the~~ Company ~~increased~~expects ~~production~~interest ~~output~~expense tofor ~~execute and deliver on~~ the ~~Company’s~~full ~~increased~~year ~~backlog.~~of ~~Soundwall~~2026 ~~sales are expected~~ to ~~trend~~be ~~similarly~~lower ~~throughout~~compared to the ~~remainder~~full year of 2025 asdue ~~compared~~ to the ~~first~~decrease ~~nine~~in ~~months~~level of ~~2025,~~indebtedness ~~although~~on noall ~~assurance~~notes ~~can~~which beare ~~given~~fixed interest rates.

~~Architectural~~Income ~~Panel~~Tax ~~Sales~~Expense - –The ~~Architectural~~Company ~~panel~~had ~~sales~~income ~~commenced~~tax inexpense ~~the third quarter~~ of ~~2025~~$422, ~~as compared~~or toan noeffective ~~architectural~~tax ~~panel~~rate ~~sales in the first two quarters~~ of ~~2025.~~24%, Infor ~~2024~~the ~~there~~three ~~was~~months ~~production~~ended ofMarch ~~two~~31, ~~architectural~~2026, ~~projects~~compared ~~that~~to ~~started~~income ~~production~~tax atexpense ~~the end~~ of ~~the~~$1,020, ~~first~~or ~~quarter~~an ofeffective ~~2024.~~tax ~~Architectural~~rate ~~sales are expected to trend higher throughout the remainder~~ of ~~2025~~24%, asfor ~~compared to~~ the ~~first~~three ~~nine~~month ~~months~~period ofended ~~2025~~March 31, ~~although no assurance can be given~~2025.

~~SlenderWall~~Net ~~Sales~~Income - ~~SlenderWall~~The ~~sales~~Company ~~increased~~had net income of $1,339 for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2025~~2026, as compared to ~~the~~net ~~same~~income ~~periods~~of in$3,327 ~~2024.~~for ~~The Company produced SlenderWall projects in~~ the ~~nine~~three month period ended ~~September~~March 3031, 2025. Basic and ~~the~~diluted ~~Company~~earnings ~~did~~per ~~not~~share ~~have~~were aboth ~~SlenderWall~~$0.25 ~~project~~for ~~in production during~~ the ~~first~~three ~~nine~~ months ofended ~~2024.~~March ~~The~~31, ~~Company~~2026, ~~continues~~compared to ~~focus~~$0.63 ~~sales~~and ~~initiatives~~$0.62, ~~on SlenderWall~~respectively, ~~but~~for nothe ~~assurance~~three ~~can~~month beperiod ~~given~~ended asMarch to31, ~~the success of this endeavor~~2025.

Miscellaneous Wall Sales - Miscellaneous wall sales increased for the three month period and decreased for the nine month period ended September 30, 2025 compared to the same periods in 2024. For the nine month period, miscellaneous wall sales were down due to lower production volumes as compared to 2024. Miscellaneous wall sales are expected to trend similarly through the remainder of 2025 as the first nine months of 2025, although no assurance can be provided.

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Barrier Sales - Barrier sales increased slightly for the three month period and decreased slightly for the nine month period ended September 30, 2025, compared to the same periods in 2024. The decrease over the nine month period is consistent with the Company’s continuing shift in marketing efforts from barrier sales to higher margin barrier rentals in the Delaware to Virginia region. Barrier sales are expected to trend similarly throughout the remainder of 2025 as compared to the first nine months of 2025, although no assurance can be given.

Easi-Set® and Easi-Span Building Sales - Building and restroom sales increased for the three and nine month periods ended September 30, 2025, compared to the same periods in 2024, due to increased building sales at all manufacturing plants. Building and restroom sales are expected to continue to trend similarly throughout the remainder of 2025 compared to the first nine months of 2025.

Utility Sales - Utility sales decreased significantly for the three and nine month periods ended September 30, 2025, compared to the same periods in 2024. During 2024, the Company has seen a surge in demand for utility vaults in the Northern Virginia market to support the data center growth. Utility sales are expected to trend higher for the remainder of 2025 as compared to the first nine months of 2025, although no assurance can be provided.

Miscellaneous Product Sales - Miscellaneous products are products that are produced or sold that do not meet the criteria defined for other revenue categories. Examples would include precast concrete slabs, concrete blocks, or small add-on items. Miscellaneous product sales decreased for the three and nine month periods ended September 30, 2025, compared to the same periods in 2024. The decrease is mainly from the Virginia plant which had one large project in the first nine months of 2024 for the production of precast beams and platforms and no similar project in the first nine months of 2025. Miscellaneous product sales are expected to trend similarly throughout the remainder of 2025 as compared to the first nine months of 2025, although no assurance can be given.

Barrier Rentals – Barrier rentals decreased for the three month period and increased for the nine month period ended September 30, 2025 compared to the same periods in 2024. For the third quarter, the decrease is mainly attributed to a special barrier project performed by the Company in the third quarter of 2024 that did not recur in the third quarter of 2025. For the nine month period, this increase is mainly attributed to two special barrier projects, one in each of the first and second quarters of 2025 as well as an overall increase in utilization of rental barriers. Barrier rental revenue, excluding revenue from special barrier projects, is expected to trend higher throughout the remainder of 2025 as compared to barrier rental revenue, excluding revenue from special barrier projects, in the first nine months of 2025, although no assurance can be given.

Royalty Income – Royalties increased for the three and nine month periods ended September 30, 2025, compared to the same periods in 2024. The increase is related to higher barrier production volumes experienced by the Company’s licensees. It is expected that continued infrastructure spending and the start of production by licensees of a new, low profile barrier that utilizes the J-J Hook system, will continue to drive royalties. The Company expects royalties for 2025 to exceed royalty income for the full year 2024, although no assurance can be given.

Shipping and Installation – Shipping revenue results from shipping our products to the customers' final destination and is recognized when the shipping services take place. Installation activities include installation of our products at the customers’ construction site. Installation revenue results when attaching architectural wall panels to a building, installing an Easi-Set® or Easi-Span building at a customers' site, setting highway barrier, or setting any of our other precast products at a site specific to the requirements of the owner. Shipping and installation revenues increased for the three and nine month periods ended September 30, 2025 compared to the same periods in 2024. The increase is mainly attributed to the increase in barrier rental from the special barrier projects, and shipping and installation of SlenderWall and soundwalls.

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Cost of Sales - Cost of sales as a percentage of revenue, not including royalties, increased to 77% for the three months ended September 30, 2025 compared to 75% for the three months ended September 30, 2024. The increase for the third quarter of 2025 as compared to the same quarter in 2024 is primarily due to the increase in revenue from a special barrier project that was performed in the third quarter of 2024 which has a higher margin and lower cost of sales when compared to product margin and product cost of sales. Cost of sales as a percentage of revenue, not including royalties, decreased to 74% for the nine months ended September 30, 2025 compared to 77% for the nine months ended September 30, 2024. The decrease for the nine month period is primarily due to the increase in revenue from the special barrier projects that were performed in the first and second quarters of 2025 which have a higher margin and lower cost of sales when compared to product margin and product cost of sales.

General and Administrative Expenses - For the three months ended September 30, 2025, the Company's general and administrative expenses decreased to $1,100 from $1,720 during the same period in 2024. For the nine months ended September 30, 2025, the Company's general and administrative expenses decreased to $4,198 from $4,938 during the same period in 2024. General and administrative expense as a percentage of total revenue was 5% and 7% for the three month periods ended September 30, 2025 and 2024, respectively. General and administrative expense as a percentage of total revenue was 6% and 8% for the nine month periods ended September 30, 2025 and 2024, respectively. Such expenses decreased due to lower staffing levels impacting salaries and wages and an arbitration settlement that included the recovery of $458 in previously reserved receivables which offset general and administrative expenses in the third quarter of 2025. Salaries and wages are expected to increase for the remainder of 2025 as compared to the first nine months of 2025 as additional administrative staff are hired.

Selling Expenses - Selling expenses for the three months ended September 30, 2025 decreased to $805 from $1,010 for the same period in 2024. The slight decrease is due to a reduction in staffing levels impacting salaries and wages. Selling expenses for the nine months ended September 30, 2025 decreased by $92 to $2,563 from $2,655 in the same nine month period in 2024. Similarly to the third quarter, the slight decrease for the nine month period is due to a reduction in staffing levels impacting salaries and wages. The Company expects selling expenses to increase in future periods with the plan for additional sales associates and increased advertising spending aligning with the strategy to increase SlenderWall sales and barrier rentals.

Operating Income - The Company had operating income for the three month period ended September 30, 2025 of $3,854 compared to $3,848 for the same period in 2024. The Company had operating income for the nine month period ended September 30, 2025 of $13,759 compared to $8,031 for the same period in 2024. For the nine month period, the increase is mainly due to the increase in revenue and decrease in cost of sales as a percent of revenue.

Interest Expense - Interest expense was $44 and $56 for the three month periods ended September 30, 2025 and 2024, respectively. Interest expense was $161 and $175 for the nine month periods ended September 30, 2025 and 2024, respectively. The Company expects interest expense for the full year of 2025 to be lower compared to the full year of 2024 due to the decrease in level of indebtedness.

Income Tax Expense - The Company had an income tax expense of $994, or an effective tax rate of 26%, for the three months ended September 30, 2025, compared to income tax expense of $694, or an effective tax rate of 18% for the same period in 2024. The Company had an income tax expense of $3,325, or an effective tax rate of 24%, for the nine months ended September 30, 2025, compared to income tax expense of $1,683, or an effective tax rate of 21% for the same period in 2024. The rate was lower for the prior nine month period due in part to the tax impact of vested stock compensation in 2024.

Net Income - The Company had net income of $2,877 and $10,375 for the three and nine months ended September 30, 2025, respectively, compared to $3,150 and $6,278 for the three and nine months ended September 30, 2024, respectively. The basic and diluted earnings per share was $0.54 and $1.96, respectively, for the three and nine months ended September 30, 2025, and the basic and diluted earnings per share was $0.59 and $1.18, respectively, for the three and nine months ended September 30, 2024, respectively.

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Liquidity and Capital Resources (dollar amounts in thousands)

The Company has a mortgage note payable to Burke & Herbert Bank & Trust Company, formerly Summit Community Bank , (the “Bank”), for the construction of its North Carolina facility. The note carries a ten-year term at a fixed interest rate of 3.64% annually ~~per the Promissory Note Rate Conversion Agreement~~, with monthly payments of approximately $22, and is secured by all of the assets of Smith-Carolina and a guarantee by the Company. The balance of the note payable at ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025 was $~~980~~884 and $1942,~~166~~ respectively. ~~The loan matures on October 10, 2029.~~

The Company also has a note payable to the Bank in the amount of $1,~~342~~211 and $1,~~536~~279 as of ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025, respectively. The loan is collateralized by a first lien position on the Midland, VAVirginia plant, building, and assets. The interest rate ~~per the Promissory Note~~ is fixed at 3.99% per annum, with principal and interest payments payable monthly in the amount of approximately $27. The loan matures on March 27, 2030.

On February 10, 2022, the Company completed ~~the~~ financing ~~for~~related to its acquisition of certain real property in Midland, ~~VA from~~ ~~the~~Virginia ~~fourth quarter of 2021,~~ totaling approximately 29.8 acres~~, with a note payable to the Bank~~. The loan is collateralized by a first lien position on the related real property. The interest rate is fixed at 4.09% per annum, with principal and interest payments payable monthly over 180 months ~~for~~in the amount of approximately $21. The loan matures on February 10, 2037. The balance of the note payable on ~~September~~March 3031, ~~2025~~2026 and December 31, ~~2024~~2025 was $2,~~264~~186 and $2,~~379~~226, respectively.

InThe ~~addition~~Company’s tooutstanding ~~the~~ notes payable ~~discussed~~are ~~above,~~financed ~~the~~at ~~Company~~fixed ~~has~~rates ~~a revolving line~~ of credit evidenced by promissory note with the Bank, with the available amount of $5,000 with no balance outstanding as of September 30, 2025 and December 31, 2024. The line of credit is evidenced by a commercial revolving promissory note, which carries a variable interest ~~rate of prime, with a floor of 4~~.~~99%.~~ ~~The line of credit was renewed on January 1~~Accordingly, ~~2025 and matures January 1, 2026. The amount available is based on~~ the ~~lower of the maximum $5,000 or 50% of eligible cash, inventory, and accounts receivable balances at the financial statement date. Key provisions of the line of credit require the~~ Company’s ~~(i)~~exposure to ~~obtain~~fluctuating ~~bank~~interest ~~approval~~rates ~~for~~is ~~capital~~limited ~~expenditures~~primarily into ~~excess~~any offuture ~~$5,000~~borrowings ~~during~~under the ~~term~~variable ofrate ~~the loan and (ii) to obtain bank approval prior to its funding of any acquisition. The~~ line of credit isor ~~collateralized~~additional byfuture ~~a first lien position on the Company's accounts receivable, inventory, and equipment~~indebtedness.

On ~~September~~March 3031, ~~2025~~2026, the Company had cash totaling $13,~~376~~217 compared to cash totaling $711,~~548~~884 on December 31, ~~2024~~2025. The increase in cash iswas primarily the result of cash provided by operating ~~income~~activities ~~net~~totaling ofapproximately ~~cash~~$3.1 ~~used~~million byduring the ~~increase in accounts receivable and investing activities through capital spending as described in further detail below~~quarter. ~~The~~Operating ~~Company~~cash ~~expects~~flow ~~its~~benefited ~~cash~~from ~~position~~profitability, toincreased beaccounts ~~favorably~~payable ~~affected~~balances, toand ~~the~~deferred ~~extent~~revenue ~~that~~activity, itpartially isoffset ~~successful~~by increases in ~~collecting outstanding~~ accounts receivable and inventory balances.

The Company’s accounts receivable balances, net of allowance, at ~~September~~March 3031, ~~2025~~2026 ~~was~~were $2528,~~460,~~052 compared to $1927,~~420~~228 at December 31, ~~2024~~2025. ~~This~~The increase iswas ~~due~~ primarily attributable to ~~higher~~timing of project billings, inincreased ~~the~~product ~~second~~sales activity, and ~~third~~growth ~~quarters~~in ofunbilled ~~2025~~receivables associated with over-time revenue recognition.

23Capital ~~Table~~spending for the three months ended March 31, 2026 totaled approximately $1,630 compared to $595 for the three month period ended March 31, 2025. The 2026 expenditures were primarily related to investments in manufacturing equipment, production capacity expansion, and infrastructure improvements at the Company’s facilities. The Company, which expects product sales to be higher in 2026 as compared to 2025, intends to invest over $12,000 in 2026 for long-term strategic growth which includes continued barrier production, expansion of ~~Contents~~the Virginia and North Carolina manufacturing facilities, soundwall forms for increased production capacity, and miscellaneous manufacturing equipment. Anticipated capital expenditures exclude possible acquisitions.

~~Capital~~21 ~~spending~~Table for the nine months ended September 30, 2025 totaled $5,382 as compared to $5,543 for the same period in 2024. The 2025 expenditures were primarily for a ramp up in barrier production to expand the rental fleet, attenuators and plant expansion. The 2024 expenditures were primarily for a new batch plant system for the South Carolina manufacturing facility, utility vault forms for increased production capacity, and crash cushions to expand the Company’s rental product offering. The Company intends to invest over $6,000, for the full year 2025, which includes continued barrier production, expansion of the Virginia and North Carolina manufacturing facilities, soundwall forms for increased production capacity, and miscellaneous manufacturing equipment. Anticipated capital expenditures excludes possible acquisitions. Contents

The Company’s cash flow from operations is affected by production schedules ~~set~~established by contractors, which generally provide for payment 30 to 90 days after ~~the~~ products are produced,. Certain architectural and ~~with~~infrastructure ~~some~~projects ~~architectural~~may ~~contracts,~~also include retainage ~~may~~provisions bethat ~~held~~delay collection until ~~the entire~~ project ~~is completed~~completion. ~~This~~ ~~payment~~These ~~schedule~~factors ~~may~~can ~~result~~create in liquidity ~~challenges~~demands ~~for~~because the Company ~~because it~~ must ~~bear~~fund a portion of ~~the cost of~~ production costs before itreceiving ~~receives~~ payment from ~~its~~ customers. The Company’s average days sales outstanding, excluding the effect of unbilled revenue, was 91 days for the nine months ended September 30, 2025, compared to 85 days for the nine months ended September 30, 2024.

If actual operating results, ~~regarding the Company's~~ production schedules, sales levels, ~~and~~or ~~subsequent~~ collections on customer receivables are materially inconsistent with management'’s expectations, the Company ~~may~~could ~~in the future~~ encounter cash flow ~~and~~or liquidity ~~issues.~~challenges Ifin ~~the~~future ~~Company's~~periods. ~~operational~~In ~~performance deteriorates significantly~~addition, itsignificant ~~may~~deterioration bein ~~unable~~operating toperformance ~~comply with existing financial covenants and~~ could ~~cause~~impact ~~defaults and acceleration under its loan agreements and lose access to~~ the ~~credit facility. Although no assurances can be given, the~~ Company’s ~~believes~~ability ~~that~~to ~~its~~comply ~~current~~with ~~cash~~financial ~~resources,~~covenants ~~anticipated cash flow from operations, and the availability~~ under ~~the~~existing ~~line~~lending ~~of credit will be sufficient to finance the Company’s operations for at least the next 12 months~~agreements.

~~The~~Although ~~Company’s~~no ~~inventory~~assurances ~~was~~can $7be provided,~~890~~ onthe ~~September~~Company ~~30,~~believes ~~2025,~~that ~~and~~its ~~$6,677~~current oncash ~~December 31~~resources, ~~2024,~~anticipated orcash anflow ~~increase~~from ~~of $1~~operations,~~213. The~~ ~~increase~~and inavailability ~~inventory~~under ~~is mainly due to~~ the ~~increase~~line of ~~finished~~credit ~~goods~~will ~~inventory~~be ~~compared~~sufficient to ~~the~~finance ~~prior~~operations ~~year. The increase is primarily related to inventory needed on-hand~~ for ~~the~~at ~~anticipated~~least ~~delivery schedules including barrier production for~~ the ~~MASH~~next ~~TL3~~12 compliance. The increased inventory in MASH TL3 compliant barriers is consistent with the Company’s continuing shift in marketing efforts from barrier sales to higher margin barrier rentals in the Delaware to Virginia region. Inventory turnover was 10.2, annualized for the nine months ~~ended September 30, 2025, compared to 9~~.~~7, annualized for the same period in 2024.~~

The Company’s inventory totaled $7,217 at March 31, 2026 compared to $6,928 at December 31, 2025. The increase was primarily attributable to increased finished goods inventory and inventory maintained to support backlog production and anticipated barrier rental activity. Inventory turnover was 7.6, annualized for the three months ended March 31, 2026, compared to 7.5, annualized for the three month period ended March 31, 2025.

Critical Accounting Policies and Estimates

The Company’s critical accounting policies are more fully described in its Summary of Accounting Policies to the Company’s consolidated financial statements on Form 10-K for the year ended December 31, ~~2024~~2025.

Seasonality

The Company services the construction industry primarily in areas of the United States where construction activity may be inhibited by adverse weather during the winter. As a result, the Company may experience reduced revenues from December through February and realize a more significant part of its revenues during the other months of the year. The Company may experience lower profits, or losses, during the winter months, and as such, must have sufficient working capital to fund its operations at a reduced level until the spring construction season. The failure to generate or obtain sufficient working capital during the winter may have a material adverse effect on the Company.

Inflation

Raw material costs used in production have slightly increased for the first ~~nine~~three months of ~~2025~~2026. The Company anticipates raw material prices to slightly increase for the remainder of ~~2025~~2026, although no assurance can be given regarding future pricing.

Sales Backlog

As of ~~November~~May 111, ~~2025~~2026, the Company’s sales backlog was approximately $5448.81 million, as compared to approximately $6252.84 million at the same time in ~~2024~~2025. It is estimated that the majority of the projects in the sales backlog will be produced within 12 months, with a portion extending several years.

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ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

Not Applicable

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, including our principal executive officer and principal financial and accounting officer, conducted an evaluation of the effectiveness of our internal controls over financial reporting, and disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, as of the end of ~~the~~this quarterly period covered by this ~~Quarterly Report on~~ Form 10-Q. Based on that evaluation, our principal executive officer and principal financial and accounting officer concluded that, due to the material weaknesses described below, our disclosure controls and procedures were not effective at the reasonable assurance level as of ~~September~~March 3031, ~~2025~~2026. Notwithstanding the existence of these material weaknesses, management believes that the consolidated financial statements in this Form 10-Q present, in all material respects, the Company’s financial condition, results of operations, and cash flows for the periods disclosed in conformity with U.S. Generally Accepted Accounting Principles ~~(“U~~.~~S. GAAP”).~~

Previously Reported Material Weaknesses in Internal Control Over Financial Reporting

As previously reported in our Annual Report on Form 10-K for the year ended December 31, ~~2024 and our Quarterly Reports on Form 10-Q for the quarters ended March 31,~~ 2025 ~~and June 30~~, ~~2025,~~ management identified material weaknesses in our internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. Management has determined that the following material weaknesses in the Company’s internal control over financial reporting have not been remediated as of ~~September~~March 3031, ~~2025.~~2026:

Control Environment, Risk Assessment and Monitoring

Management has determined that the Company did not maintain appropriately designed entity-level controls impacting the (1) control environment, (2) risk assessment procedures, (3) control activities, (4) information and communication, and (5) monitoring activities to prevent or detect material misstatements to the financial statements and assess whether the components of internal control were present and functioning properly. These deficiencies were primarily attributed to (i) turnover of the Chief Financial Officer, (ii) lack of structure and responsibility, insufficient number of qualified resources, and inadequate oversight and accountability over the performance of controls, (iii) ineffective identification and assessment of risks impacting internal control over financial reporting, and (iv) ineffective evaluation and determination as to whether the components of internal control were present and functioning.

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Control Activities and Information and Communication

These material weaknesses contributed to the following additional material weaknesses within certain business processes and the information technology environment:

25· ~~Table~~Management did not design, implement, and retain appropriate documentation of ~~Contents~~formal accounting policies, procedures, and controls across substantially all of the Company’s business processes over: (i) the financial reporting process, including management review controls over key disclosures and financial statement support schedules, (ii) the monthly financial close process, including journal entries and account reconciliations and (iii) the completeness and accuracy of information used by control owners in the operation of certain controls, to achieve timely, complete, accurate financial accounting, reporting.

· Management did not design, implement, and retain appropriate documentation of formal accounting policies, procedures, and controls across substantially all of the Company’s business processes over: (i) the financial reporting process, including management review controls over key disclosures and financial statement support schedules, (ii) the monthly financial close process, including journal entries and account reconciliations and (iii) the completeness and accuracy of information used by control owners in the operation of certain controls, to achieve timely, complete, accurate financial accounting and reporting. · The Company did not design and maintain effective processes and controls to ensure all journal entries are properly reviewed and approved prior to posting to the general ledger. · Management did not design and maintain appropriate information technology general controls in the areas of user access, vendor management controls, and segregation of duties related to certain information technology systems that support the Company’s financial reporting process.

As a result of these material weaknesses, the Company’s management has concluded that, as of March 31, 2026 the Company’s internal control over financial reporting was not effective based on the criteria in Internal Control – Integrated Framework (2013) issued by the COSO.

However, after giving full consideration to these material weaknesses, and the additional analyses and other procedures that we performed to ensure that our consolidated financial statements included in this Quarterly Report on Form 10-Q were prepared in accordance with U.S. GAAP, our management has concluded that our consolidated financial statements present fairly, in all material respects, our financial position, results of operations and cash flows for the periods disclosed in conformity with U.S. GAAP.

Management communicated the results of its assessment to the Audit Committee of the Board of Directors.

Remediation Efforts

Management, with oversight from the Audit Committee and Board of Directors, is committed to the remediation of the material weaknesses described above. The Company has continued to implement measures to improve the internal control structure. Specifically, the Company has ~~hired~~taken asteps ~~Chief~~to ~~Financial~~address ~~Officer~~the ~~with~~material ~~knowledge~~weaknesses, ~~and experience in key financial reporting and internal control areas and is~~including:

· ~~Actively~~hiring, ~~pursuing~~and ~~the~~continuing ~~hiring~~to ofhire, additional ~~finance and~~ accounting ~~personnel with adequate knowledge~~ and ~~experience~~information intechnology ~~key~~personnel ~~financial~~to ~~reporting~~establish ~~and~~effective ~~internal~~processes ~~control areas; · Designing~~ and ~~implementing new entity-level~~ controls, ~~with~~including ~~greater~~establishing ~~alignment~~appropriate tosegregation ~~the COSO 2013 Internal Controls Framework; · Developing a training program and educating control owners concerning the principles~~ of ~~the~~duties, ~~Internal Control – Integrated Framework (2013) issued by COSO;~~ · ~~Implementing~~developed aformal ~~risk assessment process by which management identifies risks of misstatement related to all account balances; · Developing internal controls documentation, including comprehensive~~ accounting policies, ~~and~~ procedures ~~over financial processes~~ and controls related ~~disclosures; · Enhancing policies and procedures~~ to ~~retain~~the ~~adequate~~period-end ~~documentary~~financial ~~evidence~~reporting ~~for~~process ~~certain management review controls over certain business processes~~ including ~~precision~~designing ~~of review~~ and ~~evidence~~maintaining ~~of review procedures performed to demonstrate effective operation of such~~ controls; ·over ~~Engaging~~account ~~outside~~reconciliations, ~~resources~~journal ~~for complex accounting matters and drafting and retaining position papers for all complex~~entries, ~~non-recurring transactions; · Developing monitoring activities~~ and ~~protocols that will allow us to timely assess the design and the operating effectiveness of controls over~~ financial reporting and ~~make~~disclosures; ~~necessary~~and ~~changes to the design of controls, if any~~ · ~~Segregating~~enhanced ~~key functions within our financial and~~ information technology governance processes, ~~supporting~~including our ~~internal~~program ~~controls~~change ~~over~~management, ~~financial~~computer ~~reporting;~~operations, ·program ~~Reassessing~~development, and ~~formalizing~~user ~~the~~access ~~design of certain accounting and information technology policies relating to security and change management~~ controls, ~~including~~enhancing ~~user~~role-based access ~~reviews~~, ~~including~~and ~~assessing the need for~~ implementing a more robust information technology ~~system; and · Continuing to enhance and formalize our accounting, business operations, and information technology~~ policies, ~~procedures,~~ and ~~controls to achieve complete, accurate, and timely financial accounting, reporting and disclosures.~~procedures

While the Company believes that these efforts improved the internal control over financial reporting once implemented, these measures will require validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles.

Changes in Internal Control over Financial Reporting

Other than as described above, there were no other changes in the Company’s internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(f) and 15d-15(f) of the Exchange Act during the quarter ended ~~September~~March 3031, ~~2025~~2026 that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II — OTHER INFORMATION

ITEM 1. Legal Proceedings

The Company is not presently involved in any litigation of a material nature.

ITEM 1A. Risk Factors

Not required

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

None

ITEM 3. Defaults Upon Senior Securities

None

ITEM 4. Mine Safety Disclosures

Not applicable

ITEM 5. Other Information

None.

2725 Table of Contents

ITEM 6. Exhibits

Exhibit No.		Exhibit Description

31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934.

31.2		Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934.

32.1		Certification pursuant 18 U.S.C. Section 1350 as adapted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document.

101.SCH		XBRL Taxonomy Extension Schema Document.

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.

104		Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	SMITH-MIDLAND CORPORATION(Registrant)
Date: November 14, 2025	By:	/s/ Ashley B. Smith
Date: June 9, 2026	By:	/s/ Ashley B. Smith
		Ashley B. Smith, Chief Executive Officer
		(Principal Executive and Financial Officer)
		(Principal Executive Officer)
Date: November 14, 2025	By:	/s/ Dominic L. Hunter
Date: June 9, 2026	By:	/s/ Dominic L. Hunter
		Dominic L. Hunter, Chief Financial Officer
		(Principal Financial Officer)

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