Lakeland Fire + Safety Reports Fiscal Second Quarter 2026 Financial Results Q2'26 Net Sales Increased 36% to a Record $52.5 Million Led by a 113% Increase in Fire Services Products, Representing 49% of Total Revenue U.S.

Lakeland Fire + Safety Reports Fiscal Second Quarter 2026 Financial Results

Q2'26 Net Sales Increased 36% to a Record $52.5 Million Led by a 113% Increase in Fire Services Products, Representing 49% of Total

U.S. Net Sales Increased 78% to $22.1 Million & Europe Net Sales Increased 113% to $15.1 Million

Sequential Gross Margin Improves 240 Basis Points to 35.9% and Lower Operating Expenses Drive Positive Net Income of $0.8 Million and

Adjusted EBITDA Excluding FX to $5.1 Million

Updates Previously Issued FY 2026 Revenue and Adjusted EBITDA Excluding FX Guidance

Range to Reflect Continued Uncertainty with Global Tariff Environment

Management to Host Conference Call Today at 4:30 p.m. Eastern

HUNTSVILLE, AL - September 9, 2025 - Lakeland Industries, Inc. ("Lakeland Fire + Safety" or

"Lakeland") (NASDAQ: LAKE), a leading global manufacturer of protective clothing and apparel for industry, healthcare and first responders, has reported its financial and operational results for its fiscal second quarter ended

Key Fiscal 2026 Second Quarter and Subsequent Financial and Operational Highlights

Management Commentary

"Against a continued uncertain global tariff environment, the Lakeland team delivered record fiscal second quarter 2026 net sales revenue growth of 36%

to $52.5 million, led by a 113% increase in Fire Services revenue and sequential improvement with our product margins from both our organic and inorganic segments," said Jim Jenkins, President, Chief Executive Officer and Executive

performances in our North American Industrial and Fire segments, Asia, and LHD Australia, along with rebounds in Europe, India and a significant recovery in Canada, were partially offset by

continued softness in Latin America. A large $3.1 million boot order through Jolly Scarpe also contributed materially to the quarter. While second quarter revenue approached internal expectations, shortfalls in Latin America, due mainly to

continued delays in purchasing decisions due to tariff uncertainty and currency issues, impacted results. We expect a material recovery in Latin America in the fourth quarter, but not sufficient to meet our original performance expectations. To that

end, we are focused on expanding sales opportunities in Latin America, including Fire Services, and expect a resumption of growth in the back half of FY26.

"Additional factors affecting revenue in the second quarter included shortfalls at Eagle and LHD Germany due to ongoing delays in governmental funding

for fire services tenders, as well as Pacific Helmets resulting from updates to product offerings and production issues. Eagle and LHD are well-positioned to participate in upcoming meaningful tenders, and Pacific Helmet is now on track with

production improvements. We expect to realize benefits in the following quarters as the Pacific traditional fire helmet, featuring the innovative, highly comfortable, and safety-enhancing "Halo Flex" suspension, continues to gain

traction in the U.S.

"Looking ahead, we are focused on navigating the continued challenges from tariff uncertainties, growing top-line revenue in our fire services and industrial verticals, and implementing operating and manufacturing efficiencies to achieve higher margins and improved free cash flow. We have recently initiated a series of

targeted actions to optimize inventory levels across specific categories. Our immediate priorities include U.S. Critical Environment, Jolly, LHD Australia, and Veridian, where we see the greatest opportunity to align balances with demand and improve

efficiency. Additional inventory optimization initiatives are planned in the second half of the fiscal year in U.S. High Performance and oil and gas turnaround categories, which should further support revenue growth and improved cash flow.

"While these inventory optimization initiatives have only just begun, we expect to see measurable progress by

year-end. We believe that our proactive approach to inventory management, combined with the upcoming tender cycle, will position us for stronger execution in the back half of FY26 and build momentum heading

into FY27. In parallel, U.S. and EMEA Fire Services tender cycles are expected to restart in late FY26 and into the first quarter of FY27. This renewed tender activity is expected to increase demand for fire services in the U.S. and contribute to

improved performance at Eagle and LHD Germany.

"Looking further ahead, Lakeland is incredibly well-positioned to capitalize on long-term industry

tailwinds and structural shifts in global safety standards. Over the next three to five years, we expect to unlock substantial value through our ongoing transition to higher-margin product and service categories, accelerated innovation, and enhanced

customer engagement across both developed and emerging markets. Our expanded commercial and operational footprint, combined with a relentless focus on efficiency and agility, supports our ambition to become the most trusted name in high-performance

protective gear globally. We see a clear path to scaling our business profitably, achieving record levels of revenue, margin, and free cash flow, while deepening our role as a mission-critical partner for safety professionals worldwide. We look

forward to sharing upcoming milestones in the weeks and months ahead and at the upcoming Lake Street 9th Annual Best Ideas Growth (BIG9) Conference and the D.A. Davidson 24th Annual Diversified Industrials & Services Conference this

month," concluded Mr. Jenkins.

Fiscal 2026 Second Quarter Financial Highlights

Fiscal 2026 Second Quarter and Subsequent Operational Highlights

Fiscal 2026 Second Quarter Financial Results

Net sales were $52.5 million for the second quarter of fiscal 2026, an increase of $14.0 million or 36% compared to $38.5 million for the

second quarter of fiscal 2025. Sales from our recent acquisitions accounted for $9.0 million of the increase, while organic sales increased $5.0 million, or 14%, over the prior year. Sales of the Fire Services product line increased by

$13.6 million year-over-year, driven by $5.2 million in sales from Veridian, and a net increase in sales of $7.3 million from LHD and Jolly, as well as organic Fire Services growth of $1.1 million.

On a consolidated basis, for the second quarter of fiscal year 2026, domestic sales were $22.1 million, or 42% of total revenues, and international sales

were $30.4 million, or 58% of total revenues. This compares with domestic sales of $12.4 million, or 32% of the total, and international sales of $26.1 million, or 68%, in the second quarter of fiscal year 2025, as our recent Veridian

acquisition contributed to increased U.S. revenue in the current quarter.

Gross profit for the second quarter of fiscal 2026 was

$18.8 million, an increase of $3.6 million, or 24%, compared to $15.2 million for the second quarter of fiscal 2025. Gross profit as a percentage of net sales decreased to 35.9% for the second quarter of fiscal 2026 from 39.6% for the

second quarter of fiscal 2025. The gross margin percentage decreased in the second quarter of fiscal 2026 due to increased supply chain costs and tariffs, higher inbound freight expenses, and amortization of the

step-up in the basis of acquired inventory. Margins in the acquired businesses were impacted by increased material costs and amortization of the write-up in inventory as

part of purchase accounting. Organic gross margin percentage decreased to 38.6% from 39.5% for the second quarter of fiscal 2026, primarily due to increased sales in lower-margin regions, partially offset by a lower profit in ending inventory.

Operating expenses increased by $2.5 million, or 15%, from $16.8 million for the second quarter of fiscal 2025 to $19.3 million for the

second quarter of fiscal 2026. Operating expenses increased due to the acquisitions of Veridian and LHD, which added $1.6 million to operating expenses, as well as higher equity compensation and depreciation and amortization expenses. These

increases were offset by reductions in acquisition expenses, restructuring costs, and professional fees. Adjusted operating expenses excluding FX increased by $1.4 million, primarily due to acquired companies' operating expenses,

partially offset by lower professional fees and cost reduction initiatives. Operating loss was $4.0 million for the second quarter of fiscal 2026, compared to an operating loss of $1.6 million for the second quarter of fiscal 2025,

primarily due to the impairment of the Monterrey, Mexico facility lease of $3.6 million and the aforementioned impacts. Operating margins were (7.6%) for the second quarter of fiscal 2026, as compared to (4.1%) for the second quarter of fiscal

Net income was $0.8 million, or $0.08 per diluted earnings per share, for the second quarter of

fiscal 2026, compared to a net loss of ($1.4) million, or ($0.19) per diluted earnings per share, for the second quarter of fiscal 2025.

EBITDA excluding FX for the second quarter of fiscal year 2026 was $5.1 million, an increase of $2.4 million, or 89%, compared with $2.7 million for the second quarter of fiscal year 2025. The increase was driven by strong

performances in North America and reductions in operating expenses, partially offset by lower sales in the higher margin LATAM region.

excluding FX margin in the second quarter of fiscal year 2026 was 9.6%, an increase of 270 basis points from 6.9% in the second quarter of fiscal 2025 and an increase of 830 basis points from 1.3% in the first quarter of fiscal 2026.

Cash and cash equivalents totaled $17.7 million as of July 31, 2025, and working capital was approximately $106.9 million. Cash and cash

equivalents increased by $0.3 million and working capital increased by $4.3 million from January 31, 2025, due primarily to increases in raw materials and finished goods inventory.

As of July 31, 2025, we had borrowings of $24.9 million outstanding under the revolving credit facility, with an additional $15.1 million of

available credit under the Loan Agreement. Following the Q2 quarter-end, we sold our Decatur, Alabama, property for $6.1 million, less customary commissions and closing fees, and applied 100% of the

proceeds to repay our revolving credit facility.

Net cash used in operating activities was $9.7 million in the six months ended July 31,

2025, compared to $4.1 million in the six months ended July 31, 2024. The increase was driven by an increase in net loss of $3.4 million and changes in non-cash charges of $3.3 million,

offset by a decrease in working capital of $1.1 million.

The Company's quarterly dividend of $0.03 per share was paid on August 22, 2025,

to stockholders of record as of August 15, 2025.

Roger Shannon, Lakeland's Chief Financial Officer, added, "Strong performance in our

U.S. and Canadian Fire Services and Industrial divisions continued to support revenue growth in the fiscal second quarter. Revenue grew $14.0 million, or 36%, compared to the second quarter of fiscal year 2025. Organic revenue increased 14% to

$42.0 million in the second quarter, driven by a return to growth in the U.S., Canada, Europe and Asia.

"Our second quarter consolidated gross

margin decreased to 35.9% due to increased tariffs and supply chain expenses, partially offset by lower profit in ending inventory. Our margins in the acquired businesses were impacted by increased material costs and the amortization of the

inventory write-up as part of the purchase accounting. This accounting treatment affected reported margins by $0.4 million. On a sequential basis, consolidated gross margin increased 240 basis points from

33.5% last quarter due primarily to an anticipated reduction in purchase price variance, partially offset by higher tariff expenses.

expenses increased by $2.5 million for the quarter, of which $1.6 million was attributable to the acquisition of Veridian and LHD, as well as equity compensation, and depreciation and amortization expenses, offset by reductions in

acquisition, restructuring expenses and legal fees. On a sequential basis, operating expenses declined $1.0 million, or 5%, to $19.3 million in the fiscal second quarter from $20.3

million in the fiscal first quarter of 2026, as a result of our focused expense reduction initiatives. On an adjusted basis, operating expenses were $14.6 million in the fiscal second

quarter, more accurately showcasing the decreases in both our organic and inorganic segments resulting from the new cost reduction initiatives. On a sequential basis, adjusted operating expenses decreased $1.3 million, or 8.1%.

"Adjusted EBITDA excluding FX was $5.1 million for the fiscal second quarter, an increase of $2.4 million, or 89%, compared with

$2.7 million for the second quarter of fiscal 2025, and an increase of $4.5 million, or 740%, compared with $0.6 million for the first quarter of fiscal 2026. This significant increase was the result of record revenue, sequential

margin improvement, and OpEx improvements, which drove Adjusted EBITDA excluding FX margin higher by 270 basis points to 9.6% in the most recent quarter, an increase from 6.9% in the second quarter of fiscal 2025 and 1.3% in the first quarter of

"Our balance sheet remains strong, and we believe it will become even stronger as our $4 million in annual cost

reduction initiatives progress. These actions include the previously announced closures of our warehouse facility in Hull, England, and the Veridian manufacturing facility in Quitman, Arkansas, as part of a broader operational consolidation strategy

aimed at enhancing efficiency and reducing costs. The closures are expected to generate annual savings of approximately $1 million for the remainder of fiscal year 2026, supporting ongoing efforts to streamline global operations and improve

profitability. Further, the $6.1 million sale and partial leaseback of the Decatur, Alabama, warehouse facility further strengthens our balance sheet and provides financial flexibility for operational enhancements. In addition to these closures

and sales, we have identified and are executing further initiatives expected to yield an additional $3 million in annualized savings in the second half of fiscal 2026.

"Given the ongoing uncertainty with the global tariff environment, we are adjusting our fiscal year 2026 outlook for Adjusted EBITDA excluding FX to the

$20 - $24 million range and expect fiscal year 2026 revenue to be near the lower of the $210 -$220 million range.

"We continue to actively assess the financial impact of tariffs across our sourcing and manufacturing footprint. While it is too early to fully quantify

the effect, we are committed to protecting margins through pricing adjustments, operational efficiencies, and further diversification of our supply chain.

"This situation underscores the importance of the strategic actions we have already undertaken to streamline our cost base, improve flexibility, and

strengthen our global operations. We remain confident in our ability to drive sustained EBITDA improvement-even amid macroeconomic headwinds," concluded Shannon.

FY 2026 Guidance and Outlook Update

based on our current backlog of orders and current expectations. These metrics constitute forward-looking statements and are based on current expectations and assumptions. For a discussion of factors that could cause actual results to differ

materially from these metrics, see "Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995" below.

Revenue-We expect FY26 revenue to be between $210 million and $220 million. This revenue expectation includes the recently

completed acquisition of Veridian.