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Item 1. Business

2024-02-28 compared with 2023-03-01 · 185 added, 204 removed, 169 unchanged (70% of the section changed)

We design, engineer, manufacture and market equipment and components used primarily in road building and related construction activities, as well as other products discussed below.

Our products are used in each phase of road building, from quarrying and crushing the aggregate to application of the road surface for both asphalt and concrete.

We also manufacture certain equipment and components unrelated to road construction, including equipment for the mining, quarrying, construction, demolition, land clearing and recycling industries and port and rail yard operators;

We design, engineer, manufacture, market and service equipment and components used primarily in asphalt and concrete road building and related construction activities, as well as other products discussed below.

Our products are used in each phase of road building, from quarrying and crushing the aggregate to application of the road surface.

We also offer industrial automation controls and telematics platforms as well as manufacturing certain equipment and components unrelated to road construction, including equipment for the mining, quarrying, construction, demolition, land clearing and recycling industries and port and rail yard operators;

industrial heat transfer equipment;

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and combustion control systems.

Our products are marketed both domestically and internationally primarily to asphalt producers;

Our products are marketed both domestically and internationally primarily to asphalt and concrete producers;

highway and heavy equipment contractors;

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Corporate Strategic Objectives

Beginning in late 2019, we initiated a strategic transformation focused on implementing new business strategies and a new operating structure.

This transformation was focused on aligning our operations under the OneASTEC business model with the strategic pillars of Simplify, Focus and Grow.

As part of our strategic transformation, we have focused on optimizing our organizational structure and operations to execute our profitable growth strategy by:

• Centralizing our organization into sites with common platforms and operating models that support organic sales growth to make it easier for our customers, partners, employees and shareholders to understand and interact with us.

• Focusing on productivity gains and cost reductions across our business through reducing complexity in our organization structure to drive greater efficiencies across our operations while maintaining strong customer relationships.

• Simplifying our product offerings through the development of a rationalized global product portfolio executed through manufacturing centers of excellence.

Since the inception of these initiatives, we have consolidated five sites, including our Tacoma site in the first quarter of 2022.

Additionally, we are in the process of a multi-year phased implementation of a standardized enterprise resource planning ("ERP") system across our global organization, which will replace much of our existing disparate core financial systems.

The upgraded ERP will initially convert our internal operations, manufacturing, finance, human capital resources management and customer relationship systems to cloud-based platforms.

This new ERP system will provide for standardized processes and integrated technology solutions that enable us to better leverage automation and process efficiency, transforming how we connect people, products and processes to operate as OneASTEC.

We have materially completed the ERP global design in 2022, launched the human capital resources module throughout our domestic sites in January 2023 and expect to convert the operations of one manufacturing site along with Corporate in 2023 to set the foundation before accelerating the implementation at additional manufacturing sites.

We believe enhanced efficiencies across the Astec organization will result from utilizing our OneASTEC business model to concentrate resources on excellence initiatives, including:

• Driving commercial excellence and providing a holistic set of solutions to strengthen our relationships with customers and dealers while maintaining our market leadership positions.

• Streamlining operational excellence processes through the implementation of lean principles in our operations and incorporate production systems that embed continuous improvement into the culture of our manufacturing processes.

• Aligning key performance metrics and incentives to enhance accountability across the business and drive a performance-based culture.

• Targeting recently completed acquisitions to ensure comprehensive integration of operations and realization of anticipated synergies to support sales and profit growth.

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The customer relationship and human capital resources components of our ERP implementation discussed above are anticipated to support the excellence initiatives of our OneASTEC business model.

In addition, in the first quarter of 2022, a lean manufacturing initiative at one of our largest sites was initiated and is expected to drive improvement in gross margin at that site.

In late 2023, management refreshed our OneASTEC Vision:

To build industry changing solutions that create life-changing opportunities .

Our strategic pillars are aligned to support our Vision and are focused on our employees, our customers and our innovation.

Empowered, Enabled and Engaged Employees

We strive to develop empowered, enabled and engaged employees by providing competitive compensation and benefits, offering professional and technical skills development opportunities and maintaining a focus on safety.

In addition, we leverage the following initiatives, among others, to enhance our employee experience:

• Reinforcing our OneASTEC business model through development of common platforms to unite and strengthen the integration of our global business.

• Establishing a performance culture through consistent execution with a focus on our OneASTEC operating model.

• Streamlining operational excellence processes that embed continuous improvement into our manufacturing processes.

• Providing life changing learning and development opportunities.

Customer Focused

We believe that a strong focus on customers across the Astec organization drives our Vision.

Specific actions we are taking to strengthen and maintain our focus on our customers include:

• Strengthening our capabilities to deliver an enhanced aftermarket experience that best meets our customers' needs while creating scalable growth.

• Driving commercial and operational excellence and providing innovative solutions to strengthen our relationships with customers and dealers while maintaining our market leadership positions.

• Simplifying our product offerings and production processes through the development of a rationalized global product portfolio executed through manufacturing centers of excellence.

• Identifying opportunities to strengthen our global presence in attractive new markets, supplement our current product offerings or accelerate technologies or other enhancements that leverage our existing product portfolio to better meet our customers' needs either through strategic acquisition, partnerships or organic growth.

• Enhancing quality, parts availability and customer connectivity through Astec Digital.

Industry Changing Innovation

We have a legacy of industry changing innovation that has been instrumental to our success for over 50 years.

We are continuing to build on that legacy by:

• Focusing on innovation with a new product development approach that increases our market competitiveness over time.

• Leveraging technology and digital connectivity to enhance the customer experience through controls and automation and other technologies.

• Developing the Astec Digital Ecosystem to enable customers to leverage our entire product portfolio and associated data.

Strategic Transformation Program

We are undergoing a multi-year phased implementation of a standardized enterprise resource planning ("ERP") system across our global organization, which will replace much of our existing disparate core financial systems.

The upgraded ERP will support our focus on our employees, our customers and innovation initially through the conversion of our internal operations, manufacturing, finance, human capital resources management and customer relationship systems to cloud-based platforms.

This new ERP system will also provide for standardized processes and integrated technology solutions that enable us to better leverage automation and process efficiency, transforming how we connect people, products and processes to operate as OneASTEC.

We materially completed the ERP global design in 2022, launched the human capital resources module in our locations in the United States in January 2023 and converted the operations of one manufacturing site along with Corporate during the second quarter of 2023 to set the foundation before accelerating the implementation at additional sites in 2024 and 2025.

Additionally, in the first quarter of 2022, a lean manufacturing initiative at one of our largest sites was initiated and is expected to drive improvement in gross margin at that site.

We substantially completed the design efforts for this project during 2022.

We also began executing investments to acquire and install manufacturing equipment intended to drive increased efficiencies in our production processes.

We plan to continue these capital investments during 2023, which are anticipated to be completed by the end of the year.

Gross margin improvements are expected to be realized with the project completion in early to mid-2024.

We continued these capital investments during 2023, which were largely completed as of December 31, 2023.

Gross margin improvements are expected to be realized in conjunction with the project completion in early to mid-2024.

This improvement is intended to serve as the optimal blueprint for our other manufacturing facilities.

We are focused on growing sales and profits organically as well as selectively pursuing strategic acquisitions and partnerships within the "Rock to Road" value chain, including by:

• Focusing on innovation with a new product development approach that increases our market competitiveness over time.

• Leveraging technology and digital connectivity to enhance the customer experience through controls and automation and other technologies.

• Identifying potential targets for strategic acquisitions and partnerships globally to establish a presence in attractive new markets, supplement our current product offerings or accelerate technologies or other enhancements that leverage our existing product portfolio.

• Strengthening our capabilities to deliver an enhanced aftermarket experience that best meets our customers' needs while creating scalable growth.

Since 2020, we have completed four acquisitions, strengthening our concrete production equipment and controls and automation offerings.

A further discussion of these acquisitions is included in Part II, Item 8.

Financial Statements and Supplementary Data of this Annual Report on Form 10-K.

Business Segments

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Our two reportable business segments, Infrastructure Solutions and Materials Solutions, comprise sites based upon the nature of the products produced or services provided, the type of customer for the products, the similarity of economic characteristics, the manner in which management reviews results and the nature of the production process, among other considerations.

The Corporate and Other category consists primarily of the parent company, Astec Insurance Company ("Astec Insurance" or the "captive"), a captive insurance company, and the controls and automation business, which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the other reporting segments.

The Corporate and Other category consists primarily of our parent company, Astec Insurance Company ("Astec Insurance" or the "captive"), our captive insurance company, and Astec Digital, our controls and automation business including the MINDS Automation Group, Inc.

business acquired in April 2022, which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the other reporting segments.

We evaluate performance and allocate resources to our operating segments based on Segment Operating Adjusted EBITDA.

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Infrastructure Solutions Segment

The Infrastructure Solutions segment designs, engineers, manufactures and markets a complete line of asphalt plants, concrete plants and their related components and ancillary equipment as well as supplying asphalt road construction equipment, industrial thermal systems and other heavy equipment.

The Infrastructure Solutions segment designs, engineers, manufactures and markets a complete line of asphalt and concrete plants, components and ancillary equipment as well as asphalt road construction equipment, industrial thermal systems, land clearing, recycling and other heavy equipment.

The Infrastructure Solutions segment was operated from the following sites in 2023 :

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CHA-Wilson Rd Tennessee, United States

Table of Conten t s

The sites based in North America within the Infrastructure Solutions segment are primarily manufacturing operations while those located outside of North America generally market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of our manufacturing sites.

Based on an internal review of our operations, beginning January 1, 2022, the India site, which was previously incorporated into the Materials Solutions segment, is reported in the Infrastructure Solutions segment while the Thailand site, which was previously included in the Infrastructure Solutions segment, is reported in the Materials Solutions segment.

Products and Services

The primary products produced by the Infrastructure Solutions segment include:

The primary products produced and services provided by the Infrastructure Solutions segment include:

Asphalt plants and related components Heaters Concrete dust control systems

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Polymer plants Concrete mixers

A typical asphalt mixing plant consists of heating and storage equipment for liquid asphalt;

cold feed bins for blending aggregates;

a counter-flow continuous type unit (Astec Double Barrel) for drying, heating and mixing;

a baghouse composed of air filters and other pollution control devices;

hot storage bins or silos for temporary storage of hot-mix asphalt;

and a control house.

We introduced the concept of high plant portability for asphalt plants in 1979.

Our current generation of portable asphalt plants is marketed as the Six Pack and consists of six or more portable components designed to be easily transported from one construction site to another, thereby reducing relocation expenses and interruption of operations.

High plant portability is an industry innovation that we have developed and successfully market.

The components in our asphalt mixing plants are fully automated and use both microprocessor-based and programmable logic control systems for efficient operation.

The plants are manufactured to meet or exceed federal and state clean air standards.

We also build batch type asphalt plants and have developed specialized asphalt recycling equipment for use with our hot-mix asphalt plants.

We engineer and develop new products and product enhancements dedicated to improving customers' productivity and profitability.

Our products share environmentally conscious designs and are crafted from quality materials by an expert staff of dedicated professionals.

Our new National Type Evaluation Program Certified Self-Erect Storage Silo offers overnight storage capabilities with options that allow for longer-term storage.

The silo and drag share a common chassis and are erected together using hydraulic cylinders, alleviating the need for a crane to enable our customers to save set up time and costs.

In addition, the freshly redesigned versatile Astec Batch Tower offers a broad range of mixing capacity with varying volumes of hot bin storage and builds upon our legacy of delivering sound performance paired with exceptional technology.

We developed the patented water injection warm mix asphalt system, which allows the asphalt mix to be prepared and placed at lower temperatures than conventional systems and operates with a substantial reduction in emissions during paving and load-out.

Previous technologies for warm mix production rely on expensive additives, procedures and/or special asphalt cement delivery systems that significantly increase the cost per ton of mix.

Our multi-nozzle device eliminates the need for the expensive additives by mixing a small amount of water and asphalt cement together to create microscopic bubbles that reduce the viscosity of the liquid asphalt coating on the rock, thereby allowing the mix to be handled and worked at lower temperatures.

Sustainability is a key focus in our development considerations, and we are continuously exploring methods and practices that will contribute to sustainable infrastructure and a healthy environment for generations to come.

Our team is constantly working to find solutions to help our asphalt plant customers reduce the environmental impact of asphalt mixing operations in user-friendly and budget-conscious ways.

These innovations can be seen across our asphalt production equipment product line.

Among our many leading products that can enhance the sustainability of an asphalt mixing operation are the Double Barrel XHR, the warm mix system, low emissions burners in the Phoenix burner line, vent condensers for asphalt storage tanks and blue smoke system s.

During 2022, we joined The Road Forward, an industry-wide initiative of the National Asphalt Pavement Association, to engage, educate and empower the U.S.

asphalt community to produce and construct net zero carbon emission asphalt

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pavements by 2050.

We also joined the U.S.

Department of Energy's Better Plants program that offers support to leading U.S.

manufacturers in the form of technical advice, energy efficient training and data analyzation to help reduce energy consumption.

Asphalt continues to be one of the most recycled products in the United States and the use of reclaimed asphalt pavement ("RAP") continues to remain highly used in new pavement.

We continue to develop methods that make it feasible to produce quality asphalt mixes with up to 70% RAP content.

We are focused on producing equipment with the most advanced mix recycling technology in the industry.

More tons of RAP are available than are currently being utilized due to restrictions in the amount of RAP allowed by various governmental agencies.

Our recycle technology, including the RAP Pre-Dryer System, is continuously being enhanced and is providing the science to alleviate the concerns driving such restrictions and to improve RAP utilization percentages in the asphalt industry.

Many of our highly technical, sophisticated large asphalt plants, while ideally suited for the North American market, are not as well suited in many international markets.

As such, we have designed single-load and single-chassis portable plants that are better suited for the international markets.

The Vantage 140 (the "Vantage") portable asphalt plant, which is based upon our proven Double Barrel drum mixer, has production capacity of 140 metric tons per hour and RAP mixing capabilities of 50%.

The Vantage also provides full-size plant features in a compact highly-portable configuration.

Additionally, the Ventura 140SL portable asphalt plant is also focused on satisfying needs of the international market and allows for a smaller, more mobile plant design with single-load capability.

Our pavers have been designed to minimize maintenance costs while exceeding road surface smoothness requirements.

Generally, our equipment can be used in tandem with each other or separately with equipment already owned by the customer.

Our RP-Series paver line has been updated with operator controls that provide improved functionality and a compact, modern feel.

All highway class asphalt pavers are now outfitted with an innovative digital control system and easy-to-understand touch screen interface.

These product updates deliver a balance of intuitive technology and simplified operation, providing the durability and serviceability our customers expect.

Our mobile, self-propelled material transfer vehicle ("Shuttle Buggy") allows continuous paving by separating truck unloading from the paving process while remixing the asphalt.

A typical asphalt paver must stop paving to permit truck unloading of asphalt mix.

By permitting continuous paving, the Shuttle Buggy allows the asphalt paver to produce a smoother road surface while reducing the time required to pave the road surface and the number of haul trucks required.

Studies using infrared technology have revealed problems caused by differential cooling of the hot-mix during hauling, but the Shuttle Buggy remixes the material to a uniform temperature and gradation, thus eliminating these problems.

The Shuttle Buggy includes the Guardian System that is designed to anticipate equipment maintenance needs resulting in more uptime reliability while also providing production and performance data as well as real-time location information to the owner.

The SB3000 model incorporates features and technology to improve the user experience in terms of improved visibility, ground level operation, as well as improved material handling and vehicle transportability.

Our Spray Paver model, which is recommended for use with the Shuttle Buggy, is also designed to carry and spray tack coat directly in front of the hot mix asphalt in a single process, thus eliminating the need for a separate tack truck.

Milling machines remove old asphalt from the road surface before new asphalt mix is applied.

Our product line of milling machines, which are designed for larger jobs, are manufactured with a simplified control system, wide conveyors, direct drives and a wide range of horsepower and cutting capabilities to provide versatility in product application.

In addition to the half-lane and larger highway class milling machines, we also manufacture a smaller, utility class machine for two-to-four foot cutting widths and a utility class cold planer model mounted on steel wheels.

Soil stabilizers are produced in multiple configurations and double as asphalt reclaiming machines for road rehabilitations, in addition to their primary purpose of stabilizing soil sub-grades with additives to provide an improved base on which to pave.

Our patented screeds use a hydraulic powered generator to electrify elements that heat a screed plate so asphalt will not stick to it while paving, attach to asphalt paving machines and place asphalt on the roadbed at a desired thickness and width while smoothing and compacting the surface.

Our screeds can be configured to fit many types of asphalt paving machines, including machines manufactured by our competitors.

Concrete is one of the world's most used and durable construction materials.

We manufacture industry leading portable and stationary concrete production equipment including transit and central mix concrete plants.

Our portable concrete plants are known for quick set-up and tear down as well as exceptionable reliability and longevity over numerous relocations.

Our stationary concrete production plants are known for custom-engineered design flexibility suitable for various concrete production sites.

Our concrete mixer designs include tilt mixers and horizontal reversing mixers.

Both mixer types are available as stationary designs with optional mobile and self-erect features.

The tilt mixer is our most popular mixer type for concrete paving and ready mix production while the horizontal reversing mixers are a low dust, low noise option primarily marketed to ready mix producers.

We produce a comprehensive portfolio of customized burners for industrial applications such as boilers, chemical plants, oil and gas refineries, offshore platforms, power generation plants, thermal fluid heaters and asphalt aggregate drying.

We have recently invested in our burner technology specifically to develop burners that will enable our customers to achieve their carbon footprint reduction goals, lower energy consumption and reduce or eliminate dependence on fossil fuels.

Our burners can use alternative

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fuels such as renewable natural gas, hydrogen blended natural gas and biomass to liquid fuels.

We are preparing to meet the demand for alternative fuels as the infrastructure and resources become available.

Our versatile Versa Jet burner platform is d eveloped for retrofit applications and has the capacity to fire at a range of rates.

The adaptable design is compatible with virtually all drum designs and can be installed with minimal modifications needed to asphalt mixing plants produced by us as well as our competitors.

We also produce industry leading combustion products for a variety of industrial applications as new applications have grown rapidly.

At the present time, our products, most of which are customized for a particular application, are used in a score of different industries and purposes including chemical plants, at oil-and-gas refineries, on off-shore platforms, on barges, at power generation plants, wood product manufacturers, food processors, textile factories, pharmaceutical producers and roofing manufacturers.

We market our products domestically and internationally through direct and dealer support sales staff, domestic and international independent distributors and our international distribution sites in both of our reportable segments.

Asphalt and concrete plants and their related equipment are sold directly to asphalt or concrete producers, respectively, or domestic and foreign government agencies.

Asphalt paving and road building equipment are sold to highway and heavy equipment contractors, utility contractors and domestic and foreign governmental agencies.

Wood chippers, horizontal grinders and blower trucks are primarily sold to forestry and environmental recycling contractors.

This industry segment faces strong competition in price, service and product performance and competes with both large publicly-traded companies and various smaller manufacturers.

The Infrastructure Solutions segment competitors include:

As the backbone of road infrastructure development, asphalt and concrete mixing plants play a crucial role in the construction industry.

We have been at the forefront of introducing groundbreaking innovations that have reshaped the landscape of asphalt and concrete production since our inception.

A typical asphalt mixing plant comprises various components, including heating and storage equipment for liquid asphalt, cold feed bins for aggregate blending, a counter-flow continuous dryer drum, an emissions control baghouse, hot storage bins and a control house.

In 1979, we introduced the concept of high plant portability, revolutionizing asphalt plants.

The current generation features six or more portable components designed for easy transportation between construction sites.

This innovation can serve to significantly reduce relocation expenses and operational interruptions.

Our Portable Self-Erect Cement Bins for the concrete industry provide low-profile mobile cement storage and ship pre-wired and pre-plumbed for quick setup.

Customized concrete plants are engineered to fit within job site constraints across a wide range of concrete production applications.

Our patented water injection warm mix asphalt system stands out as a revolutionary advancement.

This system allows the preparation and placement of asphalt mix at lower temperatures, resulting in substantial emissions reduction during paving and load-out.

Unlike previous technologies, our multi-nozzle device eliminates the need for costly additives by creating microscopic bubbles through the mixing of water and asphalt cement.

Our burner products find applications across various industries, emphasizing customization for specific applications.

From chemical plants to oil-and-gas refineries, offshore platforms, power generation plants and more, our burner products are known for their versatility and adaptability.

Certain of our asphalt burner platforms are developed for retrofit applications and offer compatibility with most drum designs.

Our investment in combustion technology aims to help customers achieve carbon footprint reduction goals.

We offer burners that can use alternative fuels such as renewable natural gas, hydrogen blended natural gas and biomass as opposed to traditional liquid fuels.

Our burner portfolio has the ability to achieve the most stringent emissions and efficiency requirements for a variety of projects.

Our mixing plants boast fully automated components, incorporating microprocessor-based and programmable logic control systems for optimal efficiency.

As part of our commitment to environmental responsibility, these plants are manufactured to meet or exceed federal and state clean air standards.

We offer many products with advanced control technology, including low-emission burners and emissions-control devices like dust collectors, charcoal fume scrubbers and blue smoke systems.

Our horizontal wood grinders, disc and drum chippers, as well as blower trucks and trailers have been diverting green waste from landfills for over 40 years.

Horizontal grinders are used to create mulch from green waste for water retention, erosion control and compost for soil amendments.

Our new 5710E Horizontal Grinder allows for efficiency gains and higher productivity while also delivering reduced fuel consumption per unit of material produced and safety enhancements during maintenance activities.

The 5710E represents a new generation of organic waste reducing machines, diverting low value material away from landfills and turning it into high value saleable product for our customers.

Drum chippers create biomass wood chips from un-merchantable wood for energy production, erosion control, playground chips or landscaping.

Blower trucks are used for erosion control, landscaping, green roofs and the application of playground chips.

Our pavers are designed for minimal maintenance costs while exceeding road surface smoothness requirements.

Our F-Series pavers also feature a significant noise reduction over previous models, efficiency improvements in the cooling and hydraulic systems and an articulating track frame that, in addition to operator comfort, will also further improve the high quality road smoothness reputation of our pavers.

The mobile, self-propelled material transfer vehicle, known as the "Shuttle Buggy," allows

continuous paving, reducing time and haul trucks required while keeping asphalt mix temperatures consistent to create a smooth, durable finished product.

While our large asphalt plants excel in the North American market, we have designed single-load and single-chassis portable plants tailored for international markets.

Our portable asphalt plants offer high production capacity, reclaimed asphalt pavement ("RAP") mixing capabilities and compact, highly mobile designs.

The BG-Series is a line of batch plants specifically designed for the global market.

The plant features a containerized design which simplifies shipping and transporting the plant.

The BG-Series is offered in a variety of production rates to accommodate the smallest jobs to large projects.

The BG-Series is capable of utilizing high percentages of RAP and offers the versatility of a batch plant.

A number of these plants are operating in various countries around the world.

Our product lines extend beyond asphalt production, encompassing full milling machines, soil stabilizers, patented screeds and concrete production equipment.

The new RX-405 Cold Planer is ideal for contractors who need a smaller cold planer with the high productivity that our larger milling machines are known for.

This new machine allows for a range of cut widths from two to five feet thanks to a quick-change drum, and tooth changes are made faster with an electric drum indexer.

The all new operator station also makes controlling the machine more ergonomic and intuitive.

Our concrete plants, known for quick setup, tear-down and reliability, cater to both portable and stationary needs, providing custom-engineered design flexibility.

Focus on Sustainability

We recognize the significance of RAP in new paving applications.

Our asphalt plants include a broad spectrum of technologies to reduce the carbon footprint of asphalt production, including dryers and mixers which accommodate production of asphalt mixes with up to 70% recycled material, warm mix systems to reduce emissions and fuel consumption by minimizing production temperatures, electrified liquid storage tanks and heating systems and burners compatible with a variety of alternative fuels.

In 2022, we joined The Road Forward, an initiative by the National Asphalt Pavement Association, with a goal to achieve net zero carbon emissions during asphalt production and construction by 2050.

Additionally, our participation in the U.S.

Department of Energy's Better Plants program reflects our commitment to reducing energy consumption through technical advice, energy-efficient training and data analysis.

Asphalt and concrete plants and their related equipment are sold to asphalt or concrete producers, respectively, or domestic and foreign government agencies.

Asphalt paving and road building equipment are sold to highway and heavy equipment contractors, utility contractors, commercial and residential paving contractors and governmental agencies, both domestically and internationally.

Wood chippers, horizontal grinders and blower trucks are primarily sold to clearing, right of way, forestry and environmental recycling contractors.

This industry segment faces strong competition in price, service and product performance.

The Infrastructure Solutions segment's primary competitors include the following as well as smaller manufacturers, both domestic and international:

Product Categories Primary Competitors

Asphalt plants and related components Asphalt Drum Mixers Inc, Asphalt Equipment Company Inc.

dba ALmix, Ammann Group, Wirtgen Group (a John Deere Company), Marini (part of Fayat Group), Gencor Industries, Inc.

and local manufacturers

Concrete equipment ERIE Strayer Company, Stephens Manufacturing and Vince Hagan Co.

Paving and related equipment Bomag (part of Fayat Group), Caterpillar Paving Products (part of Caterpillar, Inc.), Dynapac (part of Fayat Group), LeeBoy, Wirtgen Group (a John Deere Company), Volvo Construction Equipment (part of Volvo Group) and Weiler Inc.

Milling equipment Bomag (part of Fayat Group), Caterpillar Paving Products (part of Caterpillar, Inc.), CMI Roadbuilding, Dynapac (part of Fayat Group), Volvo Construction Equipment (part of Volvo Group AB) and Wirtgen Group (a John Deere Company)

Forestry and recycling equipment Bandit Industries, Inc., Doppstadt, Morbark, Rotochopper Inc.

and Vermeer Corporation

Asphalt plants and related components • Asphalt Drum Mixers Inc

• Asphalt Equipment Company Inc.

• Ammann Group

• Gencor Industries, Inc

• Benninghoven (part of Wirtgen Group, a John Deere Company)

Concrete equipment • ERIE Strayer Company

• Stephens Manufacturing

• Vince Hagan Co.

Paving and related equipment • Bomag (part of Fayat Group)

• Caterpillar Paving Products (part of Caterpillar, Inc.)

• Dynapac (part of Fayat Group)

• Vogele (part of Wirtgen Group, a John Deere Company)

• Weiler Inc.

Milling equipment • Bomag (part of Fayat Group)

• Caterpillar Paving Products (part of Caterpillar, Inc.)

• CMI Roadbuilding

• Dynapac (part of Fayat Group)

• Wirtgen Group (a John Deere Company)

Forestry and recycling equipment • Bandit Industries, Inc.

• EDGE Innovate

• Morbark (part of Alamo Group)

The backlog for the Infrastructure Solutions segment at December 31, 2023 and 2022 was approximately $404.6 million and $567.1 million, respectively.

Materials Solutions Segment

The Materials Solutions segment designs and manufactures heavy processing equipment, in addition to servicing and supplying parts for the aggregate, metallic mining, recycling, ports and bulk handling markets.

The Materials Solutions segment designs and manufactures heavy rock processing equipment, in addition to servicing and supplying parts for the aggregate, mining, recycling, ports and bulk handling markets.

The Materials Solutions segment was operated from the following sites in 2023 :

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Omagh Omagh, United Kingdom

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The sites within the Materials Solutions segment primarily focus on manufacturing operations with the AME site functioning to market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of our manufacturing sites.

The sites within the Materials Solutions segment primarily focus on manufacturing operations with the AME and Thailand sites functioning to market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of our manufacturing sites.

In addition to manufacturing core Materials Solutions products and asphalt plants, Belo Horizonte markets all our products to the Brazilian market.

We plan to continue to expand manufacturing at Belo Horizonte to include other product lines.

At December 31, 2023, we had an ownership interest of approximately 93% in Belo Horizonte.

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Completion of the transaction is subject to obtaining certain judicial approval in Brazil.

Based on an internal review of our operations, beginning January 1, 2022, the Thailand site, which was previously included in the Infrastructure Solutions segment, is reported in the Materials Solutions segment while the India site, which was previously incorporated into the Materials Solutions segment, is reported in the Infrastructure Solutions segment.

Products and Services

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We offer cone crushers with both roller-bearing and bushing style cones to fit any customer’s needs.

Our newly redesigned FT-Series Mobile Cone Crushers are equipped with updated controls systems, more reliable engines and increased capacity for use in secondary and tertiary crushing applications.

Our industry-leading hydraulic-relief jaw crushers offer enhanced safety and easy maintenance.

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Our screens are available in multiple sizes with up to four decks and in a variety of configurations including stationary, portable and mobile.

Our new High Frequency Portable Screening Plant is equipped with an 8-foot-wide high frequency screen, the first of its kind in the industry.

This patent-pending screen design features externally-mounted vibrators at the ends of the tappets for a more aggressive screening action, which also allows for easier maintenance and adjustments.

The screen is equipped with a hydraulic operating angle adjustment, a fines collection hopper, top- and bottom-deck discharge chutes and an aggregate spreader.

Our washing and classifying equipment is well-suited for a wide range of applications and production goals.

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With complete lines of washing, classifying, fines recovery and water clarification plants and systems, we offer solutions for any operation in portable and stationary configurations.

Conveying equipment is designed to move or store aggregate and other bulk materials in radial cone-shaped or windrow stockpiles.

Our SuperStacker telescoping conveyor and Wizard Touch automated controls are designed to add efficiency and accuracy to whatever the stockpile specifications require.

Additionally, high-capacity rail and barge loading/unloading material handling systems are an important part of our product lines.

We design and manufacture a broad range of material and bulk handling products for all production goals.

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Our mobile bulk material handling solutions are designed to handle all free-flowing bulk materials, including but not limited to ores, coal, aggregates, fertilizers, grains, woodchips and pellets.

We have created our rock breaking equipment line for aggregate, mining, construction and demolition applications.

Our conveying equipment is designed to move or store aggregate and other bulk materials in radial cone-shaped or windrow stockpiles.

Additionally, high-capacity rail and barge loading/unloading material handling systems are an important part of our product lines.

We have created our rock breaking equipment line for aggregate, mining, construction and demolition applications, including the demolition and recycling of buildings, bridges and roads.

Our comprehensive range of rock breaker boom systems are designed to break oversized material at large gyratories, grizzlies and primary/secondary crushing application sites.

These systems include boom-mounted configurations, automatic greasing packages, motor starter panels, joystick controls and easy plant integration.

Our newest mobile rock breaker, the BreakerBOSS

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5D, is used for breaking oversized material in underground mines, typically broken at draw points and grizzly stations where rock must keep flowing.

Many of our facilities maintain internationally recognized industry standard quality, environmental and health and safety assurance accreditations.

Focus on Sustainability

We manufacture certain equipment with engines that meet the Environmental Protection Agency ("EPA") Tier 4 Final and the European Stage V emissions standards that are compatible with hydrotreated vegetable oil ("HVO") fuels, a direct drop-in alternative to conventional diesel fuel.

While the energy content produced by HVO fuels is less than conventional diesel, HVO fuels offer reduced net carbon emissions with no need for upfront equipment modifications.

The principal purchasers of aggregate processing equipment include distributors, highway and heavy equipment contractors, sand and gravel producers, demolition, recycle and crushing contractors, open mine operators, quarry operators, port and inland terminal authorities, power stations and both domestic and foreign governmental agencies.

Materials Solutions equipment and aftermarket sales and service programs are primarily marketed through an extensive network of dealers via dealer support sales employees and domestic and international independent distributors.

Materials Solutions equipment and aftermarket sales and service programs are primarily marketed through an extensive network of dealers via dealer support sales employees, domestic and international independent distributors and our international distribution sites in each of our reportable segments.

The Materials Solutions segment faces strong competition in price, service and product performance.

Materials Solutions equipment primary competitors include the following as well as smaller manufacturers, both domestic and international:

The Materials Solutions segment's primary competitors include the following as well as smaller manufacturers, both domestic and international:

CDE Group McCloskey International (part of Metso Outotec Corporation) Terex Corporation

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Corporate and Other

The Corporate and Other category consists primarily of the parent company, the Company's captive insurance company, Astec Insurance, and the controls and automation business, which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the other reporting segments.

business acquired in April 2022, collectively, Astec Digital, which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the other reporting segments.

The parent company and the captive insurance company provide support and corporate oversight for other sites.

The controls and automation business manufactures hardware and software products that are marketed independently as well as included in certain products produced by our other segments.

Astec Digital is responsible for the development and delivery of the Astec Digital Ecosystem that can enable customers to leverage our product portfolio and associated data into a competitive advantage.

Astec Digital products include our industrial automation controls and our telematics platforms.

Our focus is to connect all Astec products in the "Rock to Road" value chain and leverage this data and emerging technologies to provide our customers with insight into their operations that can allow them to be more efficient, productive and sustainable.

Common to Both Reporting Segments

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Manufacturing

We manufacture many of the component parts and related equipment for our products, while several large components of our products are purchased "ready-for-use", such purchased items include engines, axles, tires and hydraulics.

In many cases, we design, engineer and manufacture custom component parts and equipment to meet the particular needs of individual customers.

Our manufacturing operations consist primarily of fabricating steel components and the assembly and testing of our products to ensure that we achieve quality standards.

We manufacture our equipment and related component parts for our products at both our domestic and international facilities.

In many cases, we design, engineer and manufacture equipment and component parts to meet the particular needs of individual customers.

Our manufacturing operations consist primarily of fabricating steel components and the integration of supplier purchased components, including the assembly and testing of our finished products to ensure that we achieve high quality standards.

Raw Materials

We purchase raw materials and some manufactured components and replacement parts for our products from leading suppliers both domestically and internationally.

Raw materials used in the manufacture of our products include carbon steel, pipe and various types of alloy steel, which are normally purchased from distributors and other sources.

The majority of steel is scheduled on a just in time arrangement from suppliers to better manage inventory requirements at our manufacturing facilities.

Based on market dynamics, we strategically and selectively order and inventory certain items beyond a just in time basis.

Raw materials for manufacturing are normally readily available;

however, certain highly customized components may require longer than normal lead times.

In addition, we have been and continue to experience increased lead times for certain standard production materials and parts and supplies.

Other components used in the manufacturing processes include engines, gearboxes, power transmissions, hydraulics and electronic systems.

Table of Conten t s

We purchase raw materials, manufactured components and replacement parts for our products from leading suppliers both domestically and internationally.

Raw materials used in the manufacture of our products include carbon steel in flat rolled, long products and pipe as well as various types of alloy steel.

Our steel suppliers include mills, distributors and other sources.

To effectively manage inventory at our manufacturing facilities, we purchase a substantial portion of carbon steel products on a just in time basis.

When market dynamics warrant, we strategically and selectively order inventory items beyond a just in time basis.

Although raw materials for manufacturing are normally readily available, certain highly customized components may require longer than normal lead times such as engines, gearboxes, hydraulic and electronic systems.

Government Regulations

We are subject to various laws and governmental regulations concerning environmental matters and employee safety and health in the United States and other countries.

The Environmental Protection Agency, the Occupational Safety & Health Administration, other federal agencies and certain state agencies have the authority to promulgate regulations that have an effect on our operations.

Many of these federal and state agencies may seek fines and penalties for violations of these laws and regulations.

We have been able to operate under these laws and regulations without any material adverse effect on our business.

We are subject to various laws and regulations concerning environmental affairs and employee safety and health in each country that we operate.

The EPA, the Occupational Safety & Health Administration ("OSHA") and other local, state and federal agencies have the authority to promulgate regulations that can impact our operations.

Local, state and federal regulating agencies have the potential to impose fines and penalties for violations of laws and regulations.

None of our operations are within highly regulated industries.

However, air pollution control equipment we manufacture, principally for hot-mix asphalt plants, must comply with certain performance standards promulgated by the Environmental Protection Agency under the Clean Air Act applicable to "new sources" or new plants.

However, the air pollution control equipment we manufacture, principally for hot-mix asphalt plants, must comply with certain performance standards promulgated by the EPA under the Clean Air Act applicable to "new sources" or new plants.

We believe our products meet all material requirements of such regulations, applicable state pollution standards and environmental protection laws.

In addition, due to the size and weight of certain equipment we manufacture, we and our customers may encounter various state regulations on maximum weights transportable on highways.

Also, some states have regulations governing the operation of asphalt mixing plants, and most states have regulations relating to the accuracy of weights and measures, which affect some of the control systems we manufacture.

Due to the size and weight of certain equipment we manufacture, we and our customers may encounter various state regulations on maximum weights transportable on highways.

Some states have regulations governing the operation of asphalt mixing plants, and most states have regulations relating to the accuracy of weights and measures, which affect some of the control systems we manufacture.

Compliance with these government regulations has not had a material effect on our capital expenditures, earnings or competitive position within the market to date.

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We have 83 trademarks registered in the United States, including logos for Astec, Carlson Paving, Heatec, KPI-JCI, Peterson Pacific, Power Flame, Roadtec and Telsmith, and the names ASTEC, CARLSON, HEATEC, JCI, KOLBERG, PETERSON, POWER FLAME, ROADTEC and TELSMITH, as well as a number of other product names.

We also have 129 trademarks registered in foreign jurisdictions, including Argentina, Australia, Brazil, Canada, China, the European Union, France, Germany, India, Italy, Kazakhstan, Mexico, New Zealand, Paraguay, Peru, Russia, South Africa, South Korea, Taiwan, Thailand, the United Kingdom, Ukraine, Uruguay and Vietnam.

We also have 129 trademarks registered in foreign jurisdictions, including Argentina, Australia, Brazil, Canada, Chile, China, the European Union, France, Germany, India, Italy, Kazakhstan, Mexico, New Zealand, Paraguay, Peru, Russia, South Africa, South Korea, Taiwan, Thailand, the United Kingdom, Ukraine, Uruguay and Vietnam.

We have 5 United States and 12 foreign trademark registration applications pending.

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Our Innovation Services team has experts in advanced fields, such as simulation and digital twin creation, who support our development initiatives.

In addition, we are focused on innovation in our products to support the "Rock to Road" value chain.

In addition, we are focused on innovation in our core products to support the "Rock to Road" value chain.

Seasonality and Backlog

Revenues have historically been strongest during the first, second and fourth quarters with the third quarter typically generating weaker results.

Over the long-term, we expect future operations to be consistent with this trend, however, quarterly revenue performance in 2021 and 2022 has varied based on recent manufacturing challenges resulting from supply chain and logistics disruptions as well as labor shortages.

Backlog represents the dollar value of firm orders for equipment, parts and related installation which are expected to be recognized in net sales in the future.

Firm orders are signed commitments from customers to complete a purchase for machinery, equipment or parts that is expected to be noncancellable and are included in backlog when we are in receipt of an executed contract and any required deposits or security and have not yet been recognized into net sales.

Certain orders for which we have received binding letters of intent or contracts will not be included in backlog until all required contractual documents and deposits are received.

As of December 31, 2023 and 2022, we had a backlog for delivery of products at certain dates in the future of approximately $569.8 million and $912.7 million, respectively.

Approximately $146.3 million of the increase in backlog between periods relates to orders from domestic customers.

Our contracts reflected in the backlog generally are not, by their terms, subject to termination.

Approximately $323.2 million of the decline in backlog between periods relates to orders from domestic customers.

Each business segment operates in domestic markets that are highly competitive with respect to price, service and product quality.

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A portion of the interstate highway system is surfaced in concrete, but the significant majority of surfaced roads in the U.S.

Table of Conten t s

paved with asphalt.

are paved with asphalt.

Although concrete is used for some new road surfaces, asphalt is used for most resurfacing.

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Built to Connect, and our Vision:

To connect people, processes and products, advancing innovative solutions from "Rock to Road" as OneASTEC.

To build industry changing solutions that create life-changing opportunities.

Every employee is also guided by our values and our code of business conduct.

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In addition, we partner with national vendors specialized in skilled labor recruitment and many of our sites have relationships with local trade schools and community colleges to attract talent.

In 2022, we again engaged our employees through the Voice of OneASTEC survey.

In total, 81% of our workforce responded and provided us with valuable feedback, a significant increase from the 73% participation in 2021.

Throughout the year we have focused on the three main areas of opportunity identified:

communication, performance management and diversity.

We saw improvement in those focus areas with scores increasing by four to six percentage points compared to our prior year results.

We engaged our employees through the Voice of OneASTEC survey in 2022, with 81% of our workforce responding and providing us with valuable feedback.

With the strong survey results provided in 2022, we continued our focus during 2023 on the areas of opportunity identified:

communication, performance management and change management.

We also focused on re-establishing engagement at the site level after a lengthy period of pandemic-related social distancing requirements.

Employee Profile

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11-508-03, with an expiration date of December 11, 2025.

Unions also represent approximately 18% of our employees at our manufacturing facilities outside the U.S.

Unions also represent approximately seven percent of our employees at our manufacturing facilities outside the U.S.

We consider our employee relations to be good.

Compensation and Benefits

As we strive to be an employer of choice, we provide competitive and robust compensation and benefits.

As an employer of choice, we provide competitive and robust compensation and benefits.

We achieve this by regularly conducting market reviews and adjusting as needed.

In addition to salaries, we provide regional programs, which can include annual bonuses, share-based compensation awards, a 401(k) plan with employee matching opportunities, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family leave, family care resources, flexible work arrangements, employee assistance programs, tuition assistance and on-site services.

In 2023, we announced an increase to our 401(k) employer match beginning in 2024 to further support our employees into retirement.

We also implemented parental leave, providing paid time off for our new mothers and fathers.

Health and Safety

The well-being and safety of our employees is paramount as is indicated in our core values.

We manage safety at (and from) the highest levels, using the same tools we employ to measure and improve other aspects of business performance, such as continuous improvement, key performance indicators, scorecards and performance management.

We undertake the following actions:

• provide mandatory safety trainings each month at our production facilities, which are designed to focus on empowering our employees with the knowledge and tools they need to make safe choices and to mitigate risks;

• track safety leading and lagging indicators, which includes focusing on near misses, first aids, unsafe work observations abatement within 24 hours of identification and safety training;

• local management cascades safety practices throughout the organization, including daily "safety huddles" for each work-shift;

• utilize safety scorecards, standardized signage, and visual management throughout our facilities, in addition to traditional safety training;

• conduct monthly safety calls to discuss and share best practices with our local safety managers;

• conduct weekly safety incident reviews with leadership;

• distribute monthly employee newsletters and executive-led town hall meetings.

Table of Conten t s

Our commitment to safety is integral to our operations, it underscores our dedication to the well-being of our employees, stakeholders, and the communities in which we operate.

We hold safety paramount and prioritize a culture of safety that permeates every aspect of our business.

Rigorous safety protocols and comprehensive training programs are implemented across all levels of the organization to mitigate risks and promote a safe and healthy environment for our employees.

We continually invest in state-of-the-art safety technologies and regularly review and update our safety procedures to align with industry best practices and regulatory standards.

Our Safety Committee, comprised of cross-functional experts, meets regularly to assess and address emerging safety challenges.

This collaborative approach ensures that we are proactive in identifying potential hazards and implementing effective preventative measures.

Through transparent communication, regular safety audits, and the integration of feedback from employees and regulatory agencies, we strive to maintain the highest standards of safety performance.

Our commitment to safety extends beyond our facilities to encompass the entire supply chain, fostering a holistic approach to risk management.

We believe that by prioritizing safety, we not only safeguard our workforce but also contribute to the long-term sustainability and success of our business.

We believe in following a proactive approach to identify and mitigate safety issues.

As such, our focus is monitoring, assessing and abating leading safety indicators through our Unsafe Work Observation program, thus preventing accidents before they happen or reducing the impact if they do occur.

Abatement of safety issues in a timely fashion is incentivized through our annual incentive program, which is partially focused on this leading safety metric.

We aspire to reduce recordable injuries and lost time each year.

During the year ended December 31, 2022, we had zero recordable injuries at four of our manufacturing sites.

However, we experienced a 15% increase in our Occupational Safety and Health Administration Recordable Incident Rate for the year ended December 31, 2022, to 1.96 compared to 1.71 for the year ended December 31, 2021.

Although we have seen an increase in the recordable incident rate, the incidents are concentrated in a limited number of sites.

We have taken action to address these localized safety issues by increasing the number of corporate safety audits, providing thorough training at the site, realigning site safety focus, providing standardized safety policies and procedures and focusing on proactive injury prevention.

We have also added safety resources at these sites and within our corporate structure to improve our safety program where we are continuing to focus on proactive, transparent and streamlined communications throughout the manufacturing sites for safety related information.

Abatement of safety issues in a timely manner is incentivized through our annual incentive program, which is partially focused on this leading safety metric.

We strive for continual, incremental improvements in our safety program to reduce recordable injuries and lost time each year.

During the year ended December 31, 2023, we had zero recordable injuries at five of our manufacturing sites.

In 2023, we experienced a 35% decrease in our OSHA Recordable Incident Rate for the year ended December 31, 2023, to 1.27 compared to 1.96 for the year ended December 31, 2022.

We continually assess safety risks in order to address issues before accidents happen.

Our consistent focus on accountability, standardization of safety policies and continuing education have been instrumental in reducing our overall injury rates.

Additionally, we have simplified our communication style and methodology by utilizing picture-based communications where possible to making messaging digestible within 30 seconds or less for numerous safety topics.

Talent Development, Diversity, Equity and Inclusion

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We strive to create an environment that attracts top talent and where high performance is fostered and thrives, continuous learning is engrained, diverse experience is leveraged as a competitive advantage and careers are propelled forward.

In 2022, our High Performance Framework process ensured company-wide alignment to achieve company goals and targets.

This new model includes values, professional development and cascaded common performance goals.

We utilized our High Performance Framework process for the second year during 2023 to ensure company-wide alignment to achieve company goals and targets.

This model includes values, professional development and cascaded common performance goals.

We provide all employees a wide range of professional development experiences, both formal and informal, at various stages in their careers.

During 2023, we offered leadership training to all employees at the supervisor and manager level worldwide.

This training focused on building key leadership competencies including leading diverse and inclusive teams.

In addition, talent development and succession planning for critical roles is a cornerstone of our talent program.

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is a Tennessee corporation which was incorporated in 1972.

We make available, free of charge on or through our website (www.astecindustries.com), access to our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy Statements on Schedule 14A, Section 16 reports, amendments to those reports and other documents filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after such material is filed with, or furnished to, the Securities and Exchange Commission ("SEC").

documents filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after such material is filed with, or furnished to, the Securities and Exchange Commission ("SEC").

Information contained in our website is not part of, and is not incorporated into, this Annual Report on Form 10-K or any other report we file with or furnish to the SEC.

The SEC also maintains electronic versions of our reports on its website at www.sec.gov.

The SEC also maintains electronic versions of our reports, proxy and information statements and other information regarding issuers that file electronically with the SEC on its website at www.sec.gov.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business