Loar Holdings Inc. Segments Disclosure
18. Segment Reporting
The Company reports the results of its continuing operations in one reportable segment. The Company’s Chief Operating Decision Maker (CODM) is the Company’s (CEO). The CEO, in the role as CODM, evaluates segment performance based on sales and Adjusted EBITDA. EBITDA means earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA means EBITDA, adjusted for other items within a relevant period which are not reflective of the segment's operating performance in the period. Adjusted EBITDA is not a measurement of financial performance under U.S. GAAP, but it is the measure the Company uses to evaluate operating performance, review and assess the performance of the management team in connection with employee incentive programs, and to prepare its annual budget and financial projections. In addition, the Company uses Adjusted EBITDA of target companies to evaluate acquisitions.
The CODM assesses performance and reviews assets and makes significant capital expenditure decisions for the Company on a segment level basis and decides how to allocate resources based on Adjusted EBITDA. The CODM uses Adjusted EBITDA when determining whether to reinvest profits into the segment or to use them for acquisitions or other transactions. The measure of segment assets is reported on the balance sheet as total assets.
The following table provides a reconciliation of the Company's segment Adjusted EBITDA to net income (loss) for the years ended December 31, 2025, 2024, and 2023 (unaudited, in thousands):
|
|
Years Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Net sales |
|
$ |
496,283 |
|
|
$ |
402,819 |
|
|
$ |
317,477 |
|
Significant segment expenses: |
|
|
|
|
|
|
|
|
|
|||
Adjusted cost of sales (1) |
|
|
215,567 |
|
|
|
186,234 |
|
|
|
150,721 |
|
Adjusted selling, general and administrative expenses (2) |
|
|
78,540 |
|
|
|
61,471 |
|
|
|
47,734 |
|
Research and development costs (3) |
|
|
13,052 |
|
|
|
8,778 |
|
|
|
6,279 |
|
Adjusted EBITDA |
|
|
189,124 |
|
|
|
146,336 |
|
|
|
112,743 |
|
Recognition of inventory step-up (4) |
|
|
(45 |
) |
|
|
(1,102 |
) |
|
|
(603 |
) |
Other income (expense) (5) |
|
|
(159 |
) |
|
|
4,452 |
|
|
|
762 |
|
Transaction expenses (6) |
|
|
(11,281 |
) |
|
|
(3,390 |
) |
|
|
(3,394 |
) |
Stock-based compensation (7) |
|
|
(14,931 |
) |
|
|
(11,103 |
) |
|
|
(372 |
) |
Acquisition and facility integration costs (8) |
|
|
(5,465 |
) |
|
|
(4,491 |
) |
|
|
(1,621 |
) |
Depreciation and amortization |
|
|
(50,999 |
) |
|
|
(43,070 |
) |
|
|
(38,024 |
) |
Interest expense, net |
|
|
(25,665 |
) |
|
|
(52,112 |
) |
|
|
(67,054 |
) |
Refinancing costs |
|
|
— |
|
|
|
(6,459 |
) |
|
|
— |
|
Income tax provision |
|
|
(8,432 |
) |
|
|
(6,830 |
) |
|
|
(7,052 |
) |
Net income (loss) |
|
$ |
72,146 |
|
|
$ |
22,231 |
|
|
$ |
(4,615 |
) |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 2, 2026 | Showing above |
| 2024 | Mar 31, 2025 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.