What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-02-28 compared with 2023-03-01 · 349 added, 502 removed, 1085 unchanged (44% of the section changed)

1 unchanged sentence

Index to Consolidated Financial Statements and Supplementary Data:

Report of Independent Registered Public Accounting Firm

Reports of Independent Registered Public Accounting Firms

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Statements of Cash Flows

2 unchanged sentences

All schedules are omitted because they are not applicable, or the required information is shown in the financial statements or notes thereto.

Table of Conten t s

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors

Astec Industries, Inc.:

Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheets of Astec Industries, Inc.

and subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive (loss) income, cash flows and equity for each of the years in the three-year period ended December 31, 2022, and the related notes (collectively, the consolidated financial statements).

We also have audited the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2022, in conformity with U.S.

generally accepted accounting principles.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Reports of Independent Registered Public Accounting Firms

To the shareholders and the Board of Directors of Astec Industries, Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheet of Astec Industries, Inc.

and subsidiaries (the "Company") as of December 31, 2023, the related consolidated statements of operations, comprehensive income, shareholders' equity, and cash flows, for the year ended December 31, 2023, and the related notes (collectively referred to as the "financial statements").

We also have audited the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting.

Our responsibility is to express an opinion on the Company's consolidated financial statements and an opinion on the Company's internal control over financial reporting based on our audits.

The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting.

Our responsibility is to express an opinion on these financial statements and an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audit of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures to respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

Our audit also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or

Table of Conten t s

disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Evaluation of the sufficiency of audit evidence over inventories and net sales

As disclosed in Notes 4 and 18 to the Company's consolidated financial statements, and disclosed in the consolidated balance sheet and consolidated statement of operations, the Company recorded $393.4 million in inventories and $1,274.5 million in net sales as of December 31, 2022 and for the year then ended, respectively.

Inventories are primarily comprised of raw materials, work-in-process, and finished goods that are physically located at each of the Company's sites.

Net sales are recognized primarily from the sale of equipment and replacement parts from each of the Company's sites.

We identified the evaluation of the sufficiency of audit evidence over inventories and net sales as a critical audit matter.

Evaluating the sufficiency of the audit evidence obtained required especially subjective auditor judgment because of the decentralized structure and geographic dispersion of the Company's manufacturing locations.

This included determining the sites for which procedures were performed.

The following are the primary procedures we performed to address this critical audit matter.

We used our judgment to determine the nature and extent of procedures to be performed over inventories and net sales, including the determination of the sites for which those procedures were performed.

For certain sites where procedures were performed, we evaluated the design and tested the operating effectiveness of certain internal controls over the Company's inventories and net sales processes, including controls over the amounts recorded in inventories and the amounts recorded in net sales.

We assessed the recorded inventories for each site where procedures were performed by participating in a physical inventory count and observed a sample of inventories on hand and compared the cost recorded for a sample of inventories on hand to underlying documentation.

We assessed recorded net sales for each site where procedures were performed by selecting a sample of net sales transactions and comparing the amount recognized to underlying documentation, such as contracts with customers and shipping documentation.

We evaluated the overall sufficiency of audit evidence obtained by assessing the results of procedures performed over inventories and net sales.

Goodwill impairment analysis for the Material Solutions reporting unit

As discussed in Notes 2 and 7 to the consolidated financial statements, the Company tests goodwill for impairment annually, or more frequently if circumstances change or events occur that would more-likely-than-not reduce the fair value of a reporting unit below its carrying value.

During the year ended December 31, 2022, the Company performed a quantitative impairment analysis and determined fair values of each of its reporting units using an equally weighted combination of the discounted cash flow method and the guideline public company method.

The Company did not record any impairment of goodwill as the fair value of each reporting unit exceeded its carrying amount.

As of December 31, 2022, goodwill allocated to the Materials Solutions reportable segment was $ 19.4 million.

We identified the evaluation of the goodwill impairment analysis for the Materials Solutions reporting unit as a critical audit matter.

Evaluating the estimated fair value of the reporting unit involved a high degree of subjective auditor judgment.

Specifically, the revenue growth rates, gross margins, and discount rate assumptions used in estimating the fair value of the reporting unit were challenging to evaluate as changes to those assumptions could have had a significant effect on the Company’s assessment of the impairment of goodwill of that reporting unit.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s goodwill impairment assessment process.

This included controls related to the determination of the revenue growth rates, gross margins, and discount rate assumptions.

We involved valuation professionals with specialized skills and knowledge, who assisted in:

• evaluating the discount rate by comparing it to a discount rate range that was independently developed using publicly available market data for comparable entities

• evaluating the revenue growth rates and gross margins by comparing them to the reporting unit’s historical performance, to publicly available data for comparable companies, and to the Company’s analyst reports

• assessing the estimated fair value using the reporting unit’s cash flow assumptions and an independently developed discount rate and comparing the result to the Company’s fair value estimate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and

we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Recognition – Certain Contracts with Customers – Refer to Note 2 to the financial statements

Critical Audit Matter Description

Certain contracts include terms and conditions pursuant to which the Company recognizes revenue upon the completion of production and, at the request of the customer, stores the equipment at the Company's facilities.

Under the terms of such contracts, revenue is recorded upon the customer's assumption of title and risk of ownership and when the Company has a present right to payment.

In addition, the equipment is segregated from the Company's inventory, specifically identified as belonging to the customer and is ready for physical transfer to the customer.

The Company has not retained any specific performance obligations such that the earnings process is not complete prior to revenue recognition.

We identified the evaluation of terms and conditions in these contracts for the timing of revenue recognition to be a critical audit matter because of the judgment management makes in evaluating such contracts and the impact of such judgment on the amount of revenue recognized in a given period.

This required a high degree of auditor judgment and an increased extent of audit effort in performing procedures and evaluating whether terms and conditions in certain contracts and timing of revenue recognition were appropriately identified and evaluated by the Company.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the timing of recording of revenue from contracts with customers where the equipment is stored at the Company’s facilities included the following, among others:

• We tested the effectiveness of internal controls over management's review to determine whether revenue should be recognized.

• We tested the accuracy and completeness of the completed orders recognized in revenue through physical observation of the equipment stored at the Company’s facilities.

• We selected a sample of completed contracts with customers where the equipment was stored at the Company’s facilities and performed the following procedures for each selection:

– Confirmed contractual terms with third parties, including that the customer has requested the arrangement.

– Obtained and read the customer contract and correspondence to determine whether the Company has a present right to payment.

– Tested management’s determination that the equipment is ready for physical transfer to the customer and management’s identification of the equipment as belonging to the customer.

– Evaluated management’s identification of significant contract terms and the associated timing of revenue recognized in the consolidated financial statements.

/s/ Deloitte & Touche LLP

Nashville, Tennessee

February 28, 2024

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

To the Shareholders and Board of Directors

Astec Industries, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Astec Industries, Inc.

and subsidiaries (the Company) as of December 31, 2022, the related consolidated statement of operations, comprehensive (loss) income, cash flows and equity for each of the years in the two‑year period ended December 31, 2022, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022, and the results of its operations and its cash flows for each of the years in the two‑year period ended December 31, 2022, in conformity with U.S.

generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

We served as the Company's auditor from 2015 to 2022.

Atlanta, Georgia

March 1, 2023

Table of Conten t s

ASTEC INDUSTRIES, INC.

4 unchanged sentences

Investments 5.7 3.9

Trade receivables and contract assets, net 167.1 141.7

Other receivables, net 6.5 3.5

Trade receivables, contract assets and other receivables, net 152.7 173.6

Inventories 455.6 393.4

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

Table of Conten t s

ASTEC INDUSTRIES, INC.

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Selling, general and administrative expenses 276.4 247.6 227.1

Research and development expenses 31.5 26.5 22.1

Restructuring, impairment and other asset charges, net 5.8 9.0 2.5

Income from operations 48.6 7.5 19.9

Other (expenses) income, net:

Other expenses, net:

Interest expense ( 8.9 ) ( 2.5 ) ( 1.1 )

Interest income 2.1 1.0 0.5

Other (expenses) income, net ( 1.6 ) ( 5.5 ) 3.9

Other income (expenses), net 1.0 ( 1.6 ) ( 5.5 )

Income before income taxes 42.8 4.4 13.8

Income tax provision (benefit) 9.1 5.0 ( 2.1 )

Net (loss) income ( 0.6 ) 15.9 46.0

Net loss (income) attributable to noncontrolling interest 0.5 ( 0.1 ) —

Net (loss) income attributable to controlling interest $ ( 0.1 ) $ 15.8 $ 46.0

Net income (loss) 33.7 ( 0.6 ) 15.9

Net (income) loss attributable to noncontrolling interest ( 0.2 ) 0.5 ( 0.1 )

Net income (loss) attributable to controlling interest $ 33.5 $ ( 0.1 ) $ 15.8

Per share data:

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

Table of Conten t s

ASTEC INDUSTRIES, INC.

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

(In millions)

1 unchanged sentence

2023 2022 2021

Net (loss) income $ ( 0.6 ) $ 15.9 $ 46.0

Other comprehensive (loss) income:

Net income (loss) $ 33.7 $ ( 0.6 ) $ 15.9

Other comprehensive income (loss):

Foreign currency translation adjustments 2.1 ( 7.7 ) ( 2.1 )

Change in unrecognized pension and postretirement benefit costs — — 3.1

Other comprehensive (loss) income ( 7.7 ) 1.0 ( 1.7 )

Comprehensive loss attributable to noncontrolling interest 0.5 — —

Comprehensive (loss) income attributable to controlling interest $ ( 7.8 ) $ 16.9 $ 44.3

Other comprehensive income (loss) 2.1 ( 7.7 ) 1.0

Comprehensive (income) loss attributable to noncontrolling interest ( 0.3 ) 0.5 —

Comprehensive income (loss) attributable to controlling interest $ 35.5 $ ( 7.8 ) $ 16.9

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

Table of Conten t s

ASTEC INDUSTRIES, INC.

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Cash flows from operating activities

Net (loss) income $ ( 0.6 ) $ 15.9 $ 46.0

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

Net income (loss) $ 33.7 $ ( 0.6 ) $ 15.9

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Depreciation and amortization 25.6 27.9 30.2

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Share-based compensation 4.1 6.8 6.0

Deferred tax (benefit) provision ( 17.1 ) ( 1.3 ) 8.6

Gain on disposition of property and equipment ( 0.7 ) ( 0.6 ) ( 6.2 )

Non-cash curtailment and settlement loss (gain) on pension and postretirement benefits, net — 3.2 ( 0.5 )

Gain on disposition of subsidiary — — ( 1.6 )

Asset impairment charges, net 3.5 0.2 4.4

Deferred tax benefit ( 6.4 ) ( 17.1 ) ( 1.3 )

Gain on disposition of property and equipment, net ( 3.1 ) ( 0.7 ) ( 0.6 )

Non-cash curtailment and settlement loss on pension and postretirement benefits, net — — 3.2

Asset impairment charges 1.2 3.5 0.2

Amortization of debt issuance costs 0.3 — —

Distributions to deferred compensation programs' participants ( 1.8 ) ( 1.0 ) ( 2.5 )

Change in operating assets and liabilities, excluding the effects of acquisitions:

Sale (purchase) of trading securities, net 0.7 ( 3.1 ) 0.2

(Purchase) sale of trading securities, net ( 0.3 ) 0.7 ( 3.1 )

Receivables and other contract assets 20.5 ( 28.0 ) ( 28.4 )

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Income taxes payable/prepaid 3.6 6.0 ( 14.3 )

Net cash (used in) provided by operating activities ( 73.9 ) 7.4 141.5

Net cash provided by (used in) operating activities 27.8 ( 73.9 ) 7.4

Cash flows from investing activities:

Acquisitions, net of cash acquired — ( 17.8 ) 0.1

(Price adjustment on prior) proceeds from sale of subsidiary — ( 1.1 ) 9.1

Price adjustment on prior sale of subsidiary — — ( 1.1 )

Expenditures for property and equipment ( 34.1 ) ( 40.7 ) ( 20.1 )

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Net cash used in investing activities ( 12.9 ) ( 53.2 ) ( 18.4 )

Table of Conten t s

ASTEC INDUSTRIES, INC.

11 unchanged sentences

Repurchase of Company stock — ( 10.1 ) —

Net cash provided by (used in) financing activities 60.1 ( 12.1 ) ( 10.4 )

Net cash (used in) provided by financing activities ( 18.3 ) 60.1 ( 12.1 )

Effect of exchange rates on cash 0.6 ( 1.4 ) ( 1.1 )

(Decrease) increase in cash and cash equivalents and restricted cash ( 68.4 ) ( 24.2 ) 109.7

Decrease in cash and cash equivalents and restricted cash ( 2.8 ) ( 68.4 ) ( 24.2 )

Cash, cash equivalents and restricted cash, beginning of period 66.0 134.4 158.6

3 unchanged sentences

Interest, net of capitalized interest $ 7.0 $ 1.1 $ 0.3

Income taxes paid (refunded), net $ 17.7 $ 10.0 $ ( 20.2 )

Income taxes paid, net $ 13.8 $ 17.7 $ 10.0

Supplemental disclosures of non-cash items

3 unchanged sentences

Additions to right-of-use assets and lease liabilities $ 0.8 $ 7.3 $ 1.8

Liability award converted to equity $ — $ — $ 0.8

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

Table of Conten t s

ASTEC INDUSTRIES, INC.

1 unchanged sentence

(In millions, except share and per share data)

Common Stock Shares Common Stock Amount Additional Paid-in-

Capital Accumulated Other Comprehensive Loss Company Shares Held by Deferred Compensation Programs, at Cost Retained Earnings Non-controlling Interest Total Equity

Common Stock Shares Common Stock Amount Additional Paid-in-Capital Accumulated Other Comprehensive Loss Company Shares Held by DCP, at Cost Retained Earnings Noncontrolling Interest Total Equity

Balance, December 31, 2020

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Net income — — — — — 15.8 0.1 15.9

Other comprehensive loss — — — ( 1.7 ) — — — ( 1.7 )

Other comprehensive income (loss) — — — 1.1 — — ( 0.1 ) 1.0

Dividends ($ 0.45 per share)

1 unchanged sentence

Share-based compensation — — 6.0 — — — — 6.0

Conversion of liability awards to equity — — 0.8 — — — — 0.8

Issuance of common stock under incentive plan 155,076 — — — — — — —

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22,767,052 $ 4.5 $ 130.6 $ ( 32.4 ) $ ( 1.2 ) $ 549.3 $ 0.5 $ 651.3

Net income — — — — — 15.8 0.1 15.9

Other comprehensive income (loss) — — — 1.1 — — ( 0.1 ) 1.0

Net loss — — — — — ( 0.1 ) ( 0.5 ) ( 0.6 )

Other comprehensive loss — — — ( 7.7 ) — — — ( 7.7 )

Dividends ($ 0.49 per share)

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Deferred compensation programs' transactions, net — — 0.1 — 0.1 — — 0.2

Share repurchases ( 251,087 ) ( 0.1 ) — — — ( 10.0 ) — ( 10.1 )

Balance, December 31, 2022

22,624,031 $ 4.5 $ 135.8 $ ( 40.1 ) $ ( 1.1 ) $ 527.8 $ — $ 626.9

Net loss — — — — — ( 0.1 ) ( 0.5 ) ( 0.6 )

Other comprehensive loss — — — ( 7.7 ) — — — ( 7.7 )

Net income — — — — — 33.5 0.2 33.7

Other comprehensive income — — — 2.0 — — 0.1 2.1

Dividends ($ 0.52 per share)

4 unchanged sentences

Deferred compensation programs' transactions, net — — — — 0.3 — — 0.3

Share repurchases ( 251,087 ) ( 0.1 ) — — — ( 10.0 ) — ( 10.1 )

Balance, December 31, 2023

1 unchanged sentence

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

Table of Conten t s

ASTEC INDUSTRIES, INC.

4 unchanged sentences

is a Tennessee corporation which was incorporated in 1972.

The Company designs, engineers, manufactures and markets equipment and components used primarily in road building and related construction activities, as well as other products discussed below.

The Company's 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.

The Company designs, engineers, manufactures, markets and services equipment and components used primarily in asphalt and concrete road building and related construction activities, as well as other products discussed below.

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

The Company's product portfolio includes both asphalt and concrete equipment.

The Company also manufactures 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;

19 unchanged sentences

The Company's two reportable business segments 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 the parent company, Astec Insurance Company ("Astec Insurance" or the "captive"), a captive insurance company, and Astec Digital, 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.

Basis of Presentation and Significant Accounting Policies

3 unchanged sentences

Securities and Exchange Commission ("SEC").

The Company prepares its consolidated financial statements in accordance with U.S.

generally accepted accounting principles ("U.S.

The Company prepares its consolidated financial statements in accordance with generally accepted accounting principles in the United States of America ("U.S.

All intercompany balances and transactions between the Company and its affiliates have been eliminated in consolidation.

Noncontrolling interest in the Company's consolidated financial statements represents the 7 % interest in a consolidated subsidiary which is not owned by the Company.

Since the Company controls this subsidiary, the subsidiary's financial statements are consolidated with those of the Company, and the noncontrolling owner's 7 % share of the subsidiary's net assets and results of operations is deducted and reported as "Noncontrolling interest" in the Consolidated Balance Sheets and as "Net loss (income) attributable to noncontrolling interest" in the Consolidated Statements of Operations.

Since the Company controls this subsidiary, the subsidiary's financial statements are consolidated with those of the Company, and the noncontrolling owner's 7 % share of the subsidiary's net assets and results of operations is deducted and reported as "Noncontrolling interest" in the Consolidated Balance Sheets and as "Net (income) loss attributable to noncontrolling interest" in the Consolidated Statements of Operations.

The Company executed an agreement in February 2022 with the noncontrolling interest holder, which is undergoing a judicial reorganization in Brazil, to acquire their outstanding interest in full for R$ 10.0 M (approximately $ 2.0 million, subject to the effect of exchange rates).

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GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes.

Significant items subject to such estimates and assumptions include excess and obsolete inventory, inventory net realizable value, product warranty obligations, self-insurance loss reserves, capitalization of internal use software, goodwill impairment and the measurement of income tax assets and liabilities.

Significant items subject to such estimates and assumptions include excess and obsolete inventory, inventory net realizable value, product warranty obligations, self-insurance loss reserves, capitalization of internal use software, goodwill and other intangible assets impairment and the measurement of income tax assets and liabilities.

The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances.

2 unchanged sentences

All dollar amounts, except share and per share amounts, are in millions of dollars unless otherwise indicated.

Table of Conten t s

Significant Accounting Policies

1 unchanged sentence

The Company maintains cash balances with high credit quality institutions, the balances of which may exceed federally insured limits.

The Company had $ 25.9 million and $ 117.0 million in a government money market fund at December 31, 2022 and 2021, respectively, which is included in "Cash, cash equivalents and restricted cash" in the Consolidated Balance Sheets.

The Company had cash of $ 3.2 million and $ 0.3 million at December 31, 2022 and 2021, respectively, that is restricted as to withdrawal or use, which is included in "Cash, cash equivalents and restricted cash" in the Consolidated Balance Sheets.

The Company had $ 25.9 million in a government money market fund at December 31, 2022, which is included in "Cash, cash equivalents and restricted cash" in the Consolidated Balance Sheets.

The Company discontinued use of this fund during 2023.

The Company had cash of $ 3.4 million and $ 3.2 million at December 31, 2023 and 2022, respectively, that is restricted as to withdrawal or use primarily related to retention guarantees mainly held by its foreign subsidiaries, which is included in "Cash, cash equivalents and restricted cash" in the Consolidated Balance Sheets.

Investments - Investments consist primarily of investment-grade marketable securities.

All investments held at December 31, 2022 are classified as trading securities and are carried at fair value, with unrealized holding gains and losses included in "Other (expenses) income, net" in the Consolidated Statements of Operations.

All investments held at December 31, 2023 are classified as trading securities and are carried at fair value, with unrealized holding gains and losses included in "Other income (expenses), net" in the Consolidated Statements of Operations.

Realized gains and losses are accounted for on the specific identification method.

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The Company extends credit to its customers based on an evaluation of the customers' financial condition generally without requiring collateral, although the Company normally requires advance payments or letters of credit on large equipment orders.

A portion of the Company's credit risk is limited through credit insurance in certain international jurisdictions.

The Company held notes and other receivables, net totaling $ 3.4 million and $ 6.5 million at December 31, 2023 and 2022, respectively in "Trade receivables, contract assets and other receivables, net" in the Consolidated Balance Sheets.

Allowance for Credit Losses - The Company measures its credit losses on receivables using an expected loss model.

The Company currently monitors credit levels and financial conditions of customers on a continuing basis.

After considering historical trends for uncollectible accounts, current economic conditions and specific customer recent payment history and financial stability.

An allowance for credit losses is maintained in "Trade receivables and contract assets, net" in the Consolidated Balance Sheets at a level which management believes is sufficient to cover all probable future credit losses as of the balance sheet date based on a rolling twelve-month "look-back", specific reserves and an expectation of future economic conditions that might impact customers.

The Company currently monitors credit levels and financial conditions of customers on a continuing basis, considering historical trends for uncollectible accounts, current economic conditions and specific customer recent payment history and financial stability.

An allowance for credit losses is maintained in "Trade receivables, contract assets and other receivables, net" in the Consolidated Balance Sheets at a level which management believes is sufficient to cover all probable future credit losses as of the balance sheet date based on a rolling twelve-month "look-back", specific reserves and an expectation of future economic conditions that might impact customers.

The corresponding provision for credit losses is recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

10 unchanged sentences

Allowance balance, end of year $ 3.3 $ 2.3 $ 2.3

In addition, an allowance for credit losses related to an outstanding note receivable of $ 0.7 million is included in "Other receivables, net" in the Consolidated Balance Sheets for the years ended December 31, 2022 and 2021.

In addition, an allowance for credit losses related to outstanding notes receivables of $ 0.7 million is included in "Trade receivables, contract assets and other receivables, net" in the Consolidated Balance Sheets for the years ended December 31, 2023 and 2022.

Inventories - The Company's inventory is comprised of raw materials and parts, work-in-process, finished goods and used equipment.

Raw material and parts inventory comprises purchased steel and other purchased items for use in the manufacturing process or held for sale for the after-market parts business.

The category also includes the manufacturing cost of completed equipment sub-assemblies produced for either integration into equipment manufactured at a later date or for sale in the Company's after-market parts business.

The category also includes the manufacturing cost of completed equipment sub-

assemblies produced for either integration into equipment manufactured at a later date or for sale in the Company's after-market parts business.

Work-in-process inventory consists of the value of materials, labor and overhead incurred to date in the manufacturing of incomplete equipment or incomplete equipment sub-assemblies being produced.

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Finished goods inventory consists of completed equipment manufactured for sale to customers.

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Additional write-downs may be required in the future based upon changes in assumptions due to general economic downturns in the markets in which the Company operates, changes in competitor pricing, new product design or other technological advances introduced by the Company or its competitors and other factors unique to individual inventory items.

The most significant component of the Company's inventory is steel.

One of the most significant components of the Company's inventory is steel.

A significant decline in the market price of steel could result in a decline in the market value of the Company's equipment or parts.

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The held for sale designation and carrying value of assets held for sale is periodically reviewed and adjusted as facts and circumstances indicate that a change may be necessary.

As of December 31, 2022, the Company recorded assets held for sale of $ 15.4 million related to land and building assets of its former site in Tacoma, which are being marketed for sale.

The Company accounted for certain Enid land and building assets as assets held for sale as of December 31, 2021.

The sale of the Enid land and building was completed in the fourth quarter of 2022.

As of December 31, 2022, the Company recorded assets held for sale of $ 15.4 million related to land and building assets of its former site in Tacoma.

The sale of these assets was completed in the first quarter of 2023.

See Note 21, Strategic Transformation and Restructuring, Impairment and Other Asset Charges for additional discussion of the transactions related to these assets.

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The Company periodically reviews these lives relative to physical factors and industry trends.

If there are changes in the planned use of property or equipment or if technological changes were to occur more rapidly than anticipated, the useful lives assigned to these assets may need to be shortened, resulting in the recognition of accelerated depreciation expense in future periods.

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there are changes in the planned use of property or equipment or if technological changes were to occur more rapidly than anticipated, the useful lives assigned to these assets may need to be shortened, resulting in the recognition of accelerated depreciation expense in future periods.

Property and equipment are primarily depreciated over the following useful lives:

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The Company does not recognize ROU assets or lease liabilities for leases with a term of 12 months or less.

Capitalization of Internal Use Software - Software development activities generally consist of three stages:

(i) the preliminary project stage, (ii) the application development stage and (iii) the post implementation and operation stage.

The Company capitalizes certain software development costs during the application development stage.

These costs may include vendor hosted software costs, personnel expenses for employees and costs for third-party consulting services which are directly associated with the software development.

Capitalization ends once the implementation is substantially complete, at which point the capitalized costs are amortized ratably over the remaining contract term plus any reasonably certain renewal periods.

Software development costs that do not meet the qualification for capitalization are expensed as incurred and recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Goodwill and Other Intangible Assets - Goodwill represents the excess of the purchase price over the fair value of identifiable net assets of businesses acquired.

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Goodwill is tested for impairment by either performing a qualitative evaluation or a quantitative test.

The qualitative evaluation is an assessment of factors that includes, but is not limited to, the macroeconomic conditions, industry and competitive environment conditions, overall financial performance, business specific events and market considerations to determine whether it is more likely than not that a reporting unit's fair value is less than its carrying amount.

The qualitative evaluation is an assessment of factors that includes, but is not limited to, the macroeconomic conditions, industry and competitive

environment conditions, overall financial performance, business specific events and market considerations.

The Company may elect not to perform the qualitative assessment for some or all reporting units and perform the quantitative impairment test.

The quantitative goodwill impairment test requires the comparison the carrying value of the reporting unit's net assets to the fair value of the reporting unit.

If a qualitative assessment indicates that it is more likely than not that a reporting unit's fair value is less than its carrying amount, the Company will perform a quantitative test.

The quantitative goodwill impairment test requires the comparison of the carrying value of the reporting unit's net assets to the fair value of the reporting unit.

The Company determines fair values of each reporting unit using an equally weighted combination of the discounted cash flow method, a form of the income approach, and the guideline public company method, a form of the market approach.

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Additionally, the discount rate and the terminal growth rate are based on management's judgment of the rates that would be utilized by a hypothetical market participant.

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If a quantitative assessment indicates that it is more likely than not that a reporting unit's fair value is less than its carrying amount, a goodwill impairment charge would be recorded.

The Company's intangible assets have definite lives and are subject to amortization.

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Estimated warranty obligations are based upon warranty terms, product failure rates, repair costs and current period machine shipments.

If actual product failure rates, repair costs, service delivery costs or post-sales support costs differ from the Company's estimates, revisions to the estimated warranty liability may be required.

If actual product failure rates, repair costs, service delivery costs or post-sales support costs differ from the Company's estimates, these estimates will be re-evaluated and adjustments to the estimated warranty liability will be made, if required.

Income Taxes - Income taxes are based on pre-tax financial accounting income.

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Self-Insurance Reserves - The Company retains the risk for a portion of its workers' compensation claims and general liability claims by way of a captive insurance company, Astec Insurance.

The objectives of Astec Insurance are to improve control over and reduce the cost of claims;

The objectives of Astec Insurance are to improve control over

and reduce the cost of claims;

to improve focus on risk reduction with the development of a program structure which rewards proactive loss control;

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The undiscounted reserves are actuarially determined to cover the ultimate cost of each claim based on the Company's evaluation of the type and severity of individual claims and historical information, primarily its own claims experience, along with assumptions about future events.

Changes in assumptions, as well as changes in actual

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experience, could cause these estimates to change in the future.

Changes in assumptions, as well as changes in actual experience, could cause these estimates to change in the future.

However, the Company does not believe it is reasonably likely that the reserve level will materially change in the foreseeable future.

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No reserves are necessary for these fully-insured health plans.

Accumulated Other Comprehensive Loss - Accumulated other comprehensive loss is comprised of foreign currency translation adjustments of $ 38.1 million and $ 40.1 million as of December 31, 2023 and 2022, respectively.

Revenue Recognition - Revenue is generally recognized when the Company satisfies a performance obligation by transferring control of goods or providing services.

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Depending on the terms of the arrangement with the customer, recognition of a portion of the consideration received may be deferred and recorded as a contract liability if the Company has to satisfy a future obligation, such as to provide installation assistance, service work to be performed in the future without charge, floor plan interest to be reimbursed to the Company's dealer customers, payments for extended warranties or for obligations for future estimated returns to be allowed based upon historical trends.

Certain contracts include terms and conditions pursuant to which the Company recognizes revenues upon the completion of production, and the equipment is subsequently stored at the Company's plant at the customer's request.

Revenue is recorded on such contracts upon the customer's assumption of title and risk of ownership, which transfers control of the equipment, and when collectibility is probable.

In addition, there must be a fixed schedule of delivery of the goods consistent with the customer's business practices, the Company must not have retained any specific performance obligations such that the earnings process is not complete;

and the goods must have been segregated from the Company's inventory prior to revenue recognition.

The Company had orders totaling $ 20.7 million and $ 29.3 million in 2022 and 2021 respectively, and nominal orders in 2020 on which revenue was recorded over time based upon the ratio of costs incurred to estimated total costs.

Other contract assets and liabilities are typically not material as a percentage of total assets or total liabilities, respectively.

When sales contain multiple performance obligations, revenue attributable to the sale of a product is recognized when the product is shipped, and the revenue attributable to services provided with respect to the product (such as installation services) is recognized when the service is performed.

Consideration is allocated to deliverables using observable market prices from stand-alone performance obligations or a cost plus margin approach when one is not available.

Otherwise, the Company uses third-party evidence of selling price or an estimate of the selling price for the deliverables.

Sales with multiple performance obligations are evaluated to determine whether revenue related to individual elements should be recognized separately or as a combined unit.

In addition to the previously mentioned general revenue recognition criteria, revenue in only recognized on individual

delivered elements when there is objective and reliable evidence that the delivered element has a determinable value to the customer on a standalone basis and there is no right of return.

The Company had orders totaling approximately $ 16.0 million, $ 20.7 million and $ 29.3 million in 2023, 2022 and 2021, respectively, on which revenue was recorded over time based upon the ratio of costs incurred to estimated total costs.

Certain contracts include terms and conditions pursuant to which the Company recognizes revenues upon the completion of production and, at the request of the customer, stores the equipment at the Company's facilities.

Under the terms of such contracts, revenue is recorded upon the customer's assumption of title and risk of ownership and when the Company has a present right to payment.

In addition, the equipment is segregated from the Company's inventory, specifically identified as belonging to the customer and is ready for physical transfer to the customer.

The Company has not retained any specific performance obligations such that the earnings process is not complete prior to revenue recognition.

Service and Equipment Installation Revenue – Purchasers of certain of the Company's equipment often contract with the Company to provide installation services.

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The cost of shipping and handling is classified as cost of goods sold concurrently.

Other Revenues – Miscellaneous revenues and offsets not associated with one of the above classifications include rental revenues, extended warranty revenues, early pay discounts and floor plan interest reimbursements.

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Other Revenues - Miscellaneous revenues and offsets not associated with one of the above classifications primarily include floor plan interest reimbursements, extended warranty revenues and rental revenues.

Advertising Expense - The cost of advertising is expensed as incurred.

The Company incurred $ 1.8 million, $ 2.1 million and $ 1.5 million in advertising costs during 2023, 2022 and 2021, respectively, which are included in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Research and Development - Research and development costs primarily include employee compensation and prototype materials costs related to the development of new products and significant improvements to existing product lines.

These costs are expensed as incurred.

The Company incurred $ 22.0 million, $ 31.5 million and $ 26.5 million in research and development costs during 2023, 2022 and 2021, respectively, which are included in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Share-Based Compensation - The grant date fair value of share-based compensation awards is based upon the closing market price of the Company's common stock on the day prior to the grant date, except for performance stock awards with a total shareholder return ("TSR") market metric for which the Company estimates fair value using a Monte-Carlo simulation model.

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The Company's equity awards are further described in Note 17, Share-Based Compensation.

Restructuring - The Company continually reviews its organizational structure and operations to ensure they are optimized and aligned with achieving near-term and long-term operational and profitability targets.

In connection with this review, significant restructuring actions may be implemented.

These actions can include personnel terminations, reorganization efforts to simplify and consolidate the Company's operations or the divestiture of underperforming manufacturing sites or product lines.

Employee severance and related termination benefits are primarily based on the Company's employment policies and substantive severance plans.

The Company records liabilities related to severance programs when the actions are probable and the amounts are reasonably estimable, which typically is when a restructuring plan has been approved.

Additional liabilities may be recorded if a restructuring plan is extended or additional benefits are provided.

In the event that affected employees are required to render additional service in order to receive severance benefits at their termination dates, severance costs are measured at the date that benefits are communicated to the applicable employees and recognized as expense over the employees’ remaining service periods.

Any incremental or recovery of expense related to stock compensation programs are recognized at the end of the employees' service periods.

Restructuring costs include any ongoing costs related to exited businesses as such costs are incurred.

Contract termination costs, if applicable, are recorded when contracts are terminated.

See Note 21, Strategic

Transformation and Restructuring, Impairment and Other Asset Charges for additional discussion of the most recent restructuring actions taken.

Acquisitions - The Company accounts for business combinations using the acquisition method.

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Acquisition costs are expensed as incurred and contingent consideration, if applicable, is booked at its fair value as part of the purchase price.

See Note 3, Acquisitions for additional information on the Company's acquisitions.

See Note 3, Acquisition for additional information on the Company's most recent acquisition.

Derivatives and Hedging Activities - The Company recognizes all derivatives in the Consolidated Balance Sheets at their fair value.

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The Company does not engage in speculative transactions, nor does it hold or issue derivative financial instruments for trading purposes.

The average U.S.

dollar equivalent notional amount of outstanding foreign currency exchange contracts was $ 10.3 million during 2022.

The Company reported nominal derivative assets at December 31, 2022 and $ 0.1 million of derivative assets in "Prepaid expenses and other assets" at December 31, 2021.

The Company held nominal derivative liabilities at December 31, 2022 or 2021.

The Company recognized, as a component of "Other (expenses) income, net", a net loss on the change in fair value of derivative instruments of $ 0.5 million for the year ended December 31, 2022 and a net gain of $ 0.8 million and $ 0.2 million for the years ended December 31, 2021 and 2020, respectively.

The weighted average U.S.

dollar equivalent notional amount of outstanding foreign currency exchange contracts was $ 12.1 million during the year ended December 31, 2023.

The Company reported no derivative assets at December 31, 2023 and nominal derivative assets in "Prepaid expenses and other assets" at December 31, 2022.

The Company held $ 0.1 million of derivative liabilities at December 31, 2023 and nominal derivative liabilities in "Other current liabilities" at December 31, 2022.

The Company recognized, as a component of "Other income (expenses), net", net losses on the change in fair value of derivative instruments of $ 0.4 million and $ 0.5 million for the years ended December 31, 2023 and 2022, respectively, and a net gain of $ 0.8 million for the year ended December 31, 2021.

There were no derivatives that were designated as hedges at December 31, 2023 or 2022.

Foreign Currency - Subsidiaries located in Australia, Belgium, Brazil, Canada, Chile, France, India, South Africa, Thailand and the United Kingdom operate primarily using local functional currencies.

Foreign Currency - Subsidiaries located in Australia, Belgium, Brazil, Canada, France, India, South Africa, and the United Kingdom operate primarily using local functional currencies.

Accordingly, assets and liabilities of these subsidiaries are translated using exchange rates in effect at the end of the period, and revenues and costs are translated using average exchange rates in effect during the period.

The resulting adjustments are presented as a separate component of "Accumulated other comprehensive loss".

Foreign currency transaction gains and losses, net are included in "Other (expenses) income, net" and amounted to losses of $ 0.4 million and $ 1.3 million in 2022 and 2021, respectively, and a gain of $ 1.1 million in and 2020.

Earnings Per Share - Basic earnings per share is computed by dividing "Net (loss) income attributable to controlling interest" by the weighted average number of shares outstanding during the reported period.

Foreign currency transaction gains and losses, net are included in "Other income (expenses), net" and amounted to gains of $ 1.1 million in 2023 and losses of $ 0.4 million and $ 1.3 million in 2022 and 2021, respectively.

Earnings Per Share - Basic earnings per share is computed by dividing "Net income (loss) attributable to controlling interest" by the weighted average number of shares outstanding during the reported period.

Deferred stock units are fully vested and, as such, are included in basic earnings per share.

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Performance stock units, which are considered contingently issuable, are considered dilutive when the related performance criterion has been met.

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The following table sets forth a reconciliation of the number of shares used in the computation of basic and diluted earnings per share:

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Antidilutive securities excluded from the calculation of diluted earnings per share 7,495 255,738 75,451

Adjustments and Reclassifications

During the first quarter of 2022, the Company identified errors in its previously issued financial statements related to an overstatement of work-in-process inventory that mainly accumulated over the periods from 2018 through 2021 thereby understating "Cost of sales" in those periods and an overstatement of "Net sales" and "Cost of sales" as well as impacts to certain consolidated balance sheet financial statement line items as a result of over-time revenue recognition calculation errors at one of the Company's sites which impacted the second, third and fourth quarters of 2021.

The Company assessed the materiality of these misstatements both quantitatively and qualitatively and determined the correction of these errors to be immaterial to the prior period consolidated financial statements taken as a whole.

To reflect the correction of the above errors, the Company is revising the previously issued consolidated financial statements for the years ended and as of December 31, 2021 and 2020 in this Form 10-K.

The Company is also disclosing the impact of the revisions on the previously filed audited Consolidated Balance Sheet as of December 31, 2021 and the opening balance sheet equity impact for December 31, 2020.

As a result, the Company has corrected the misstatements as disclosed in the following tables for all impacted financial statement line items in prior periods.

In addition, certain reclassifications have been made to the prior period financial information to conform to the presentation used in the financial statements for the year ended December 31, 2022.

• The Company reclassified certain accrued liability balances from "Other current liabilities" to "Accrued employee related liabilities" to more appropriately reflect the nature of such accrued balances.

• The Company elected to present gains and losses recognized on the change in fair value of derivative instruments and foreign currency transaction gains and losses, net in "Other (expenses) income, net".

These amounts were previously included in "Cost of sales".

There was no change to previously reported "Total current liabilities" or "Net (loss) income attributable to controlling interest" related to these reclassifications.

The Company recorded a $ 1.5 million out-of-period expense during the first quarter of 2021 in "Selling, general and administrative expenses" for certain vendor hosted software licensing fees for contract costs incurred in the fourth quarter of 2020, which is not reflected as an adjustment in the tables below.

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Balance Sheet

December 31, 2021

(in millions) As Previously Reported Adjustment Reclassification As Revised / Reclassified

Trade receivables and contract assets, net $ 144.1 $ ( 2.4 ) $ — $ 141.7

Inventories 303.0 ( 4.3 ) — 298.7

Prepaid and refundable income taxes 19.5 1.0 — 20.5

Total current assets 641.7 ( 5.7 ) — 636.0

Deferred income tax assets 16.0 0.2 — 16.2

Total assets 911.3 ( 5.5 ) — 905.8

Accounts payable 83.5 ( 1.3 ) — 82.2

Accrued employee related liabilities 23.6 — 7.0 30.6

Other current liabilities 42.9 ( 0.7 ) ( 7.0 ) 35.2

Total current liabilities 225.3 ( 2.0 ) — 223.3

Total liabilities 256.5 ( 2.0 ) — 254.5

Retained earnings 552.8 ( 3.5 ) — 549.3

Shareholders' equity 654.3 ( 3.5 ) — 650.8

Total equity 654.8 ( 3.5 ) — 651.3

Total liabilities and equity 911.3 ( 5.5 ) — 905.8

Statement of Operations

Year Ended December 31, 2021

(in millions, except per share data) As Previously Reported Adjustment Reclassification As Revised / Reclassified

Net sales $ 1,097.2 $ ( 1.7 ) $ — $ 1,095.5

Cost of sales 845.5 1.0 ( 0.5 ) 846.0

Gross profit 251.7 ( 2.7 ) 0.5 249.5

Income (loss) from operations 22.1 ( 2.7 ) 0.5 19.9

Other income (expenses), net ( 5.0 ) — ( 0.5 ) ( 5.5 )

Income (loss) before income taxes 16.5 ( 2.7 ) — 13.8

Income tax provision (benefit) ( 1.4 ) ( 0.7 ) — ( 2.1 )

Net (loss) income 17.9 ( 2.0 ) — 15.9

Net (loss) income attributable to controlling interest 17.8 ( 2.0 ) — 15.8

Per share data:

(Loss) earnings per common share - Basic 0.78 ( 0.08 ) — 0.70

(Loss) earnings per common share - Diluted 0.78 ( 0.09 ) — 0.69

Year Ended December 31, 2020

As Previously Reported Adjustment Reclassification As Revised / Reclassified

Cost of sales $ 784.3 $ 1.2 $ 1.3 $ 786.8

Gross profit 240.1 ( 1.2 ) ( 1.3 ) 237.6

Income (loss) from operations 43.0 ( 1.2 ) ( 1.3 ) 40.5

Other income (expenses), net 2.6 — 1.3 3.9

Income (loss) before income taxes 45.7 ( 1.2 ) — 44.5

Income tax provision (benefit) ( 1.2 ) ( 0.3 ) — ( 1.5 )

Net (loss) income 46.9 ( 0.9 ) — 46.0

Net (loss) income attributable to controlling interest 46.9 ( 0.9 ) — 46.0

Per share data:

(Loss) earnings per common share - Basic 2.08 ( 0.04 ) — 2.04

(Loss) earnings per common share - Diluted 2.05 ( 0.04 ) — 2.01

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Statements of Comprehensive Income

Year Ended December 31, 2021

(in millions) As Previously Reported Adjustment As Revised / Reclassified

Net (loss) income $ 17.9 $ ( 2.0 ) $ 15.9

Comprehensive income (loss) attributable to controlling interest 18.9 ( 2.0 ) 16.9

Year Ended December 31, 2020

As Previously Reported Adjustment As Revised / Reclassified

Net (loss) income $ 46.9 $ ( 0.9 ) $ 46.0

Comprehensive income (loss) attributable to controlling interest 45.2 ( 0.9 ) 44.3

Statement of Cash Flows

Year Ended December 31, 2021

(in millions) As Previously Reported Adjustment Reclassification As Revised / Reclassified

Net (loss) income $ 17.9 $ ( 2.0 ) $ — $ 15.9

Receivables and other contract assets ( 30.8 ) 2.4 — ( 28.4 )

Inventories ( 53.8 ) 2.3 — ( 51.5 )

Accounts payable 30.8 ( 1.3 ) — 29.5

Accrued employee related liabilities 3.0 — 7.0 10.0

Other accrued liabilities ( 0.7 ) ( 0.7 ) ( 7.0 ) ( 8.4 )

Income taxes payable/prepaid ( 13.6 ) ( 0.7 ) — ( 14.3 )

Year Ended December 31, 2020

As Previously Reported Adjustment Reclassification As Revised / Reclassified

Net (loss) income $ 46.9 $ ( 0.9 ) $ — $ 46.0

Inventories 44.7 1.2 — 45.9

Accrued employee related liabilities ( 5.1 ) — 6.7 1.6

Other accrued liabilities 9.8 — ( 6.7 ) 3.1

Income taxes payable/prepaid 16.0 ( 0.3 ) — 15.7

Statement of Equity

(in millions) As Previously Reported Adjustment As Revised / Reclassified

Balance, December 31, 2020

Retained Earnings $ 545.2 $ ( 1.5 ) $ 543.7

Total Equity 643.0 ( 1.5 ) 641.5

Balance, December 31, 2021

Retained Earnings 552.8 ( 3.5 ) 549.3

Total Equity 654.8 ( 3.5 ) 651.3

Related Party Transactions - The Company had no material related party transactions during the years ended December 31, 2023, 2022 and 2021.

Reclassifications and Adjustments - Certain reclassifications have been made to the prior period financial information to conform to the presentation used in the financial statements for the year ended December 31, 2023.

• The Company elected to present other receivables, net of allowance for credit losses in "Trade receivables, contract assets and other receivables, net".

These amounts were previously included in a separate financial statement caption in the Consolidated Balance Sheets.

• The Company elected to present research and development expenses in "Selling, general and administrative expenses".

These amounts were previously included in a separate financial statement caption in the Consolidated Statements of Operations.

During the first quarter of 2023, the Company identified immaterial errors associated with over-accruals of inventory-related expenses in its historical financial statements.

The cumulative effect of the errors generated in 2021 and 2022 was corrected during the first quarter of 2023, resulting in a decrease in "Cost of sales" of $ 1.9 million.

Such adjustment was not considered material to the Company's consolidated financial statements for the year ended December 31, 2022 or any of the financial statements for the previously filed annual periods.

Recently Adopted Accounting Pronouncements

In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update 2019-12, "Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes", which eliminates certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences.

The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill.

The Company adopted this new standard effective January 1, 2021.

The adoption of this standard had an immaterial impact on the Company's financial position, results of operations or cash flows.

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In October 2021, the FASB issued ASU 2021-08, "Business Combinations (Topic 805):

In October 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-08, "Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers", which requires entities to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 2014-09, Revenue from Contracts with Customers (Topic 606).

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The adoption of this new standard did not have a material impact on its financial position, results of operations, cash flows or disclosures.

In November 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2021-10, "Government Assistance (Topic 832)", which aims to increase the transparency of government assistance including the disclosure of the types of assistance, an entity’s accounting for the assistance and the effect of the assistance on an entity’s financial statements.

The new guidance requires expanded disclosure about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy.

This new standard was effective for the Company on January 1, 2022.

Availability of government assistance has typically been limited.

The Company did not receive government assistance in 2022.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280):

Improvement to Reportable Segment Disclosures", which requires entities to disclose significant segment expenses, other segment items, the title and position of the chief operating decision maker ("CODM") and information related to how the CODM assesses segment performance and allocates resources, among certain other required disclosures.

Additionally, current annual disclosures will be required in interim periods.

The new standard is effective, on a retrospective basis, for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the impact this ASU will have on its financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740):

Improvements to Income Tax Disclosures", which requires entities to disclose specific categories in the income tax rate reconciliation and provide additional information for reconciling items that meet a specified quantitative threshold.

In addition, the new standard requires disclosure of the amount of income taxes paid disaggregated by federal, state and foreign taxes and by jurisdiction for exceeding a specified quantitative

Additionally, income or loss from continuing operations before income tax and income tax expense will be required to be disaggregated between domestic and foreign as well as by federal, state and foreign.

The new standard is effective for fiscal years beginning after December 15, 2024 on a prospective basis, with retrospective application permitted.

The Company is currently evaluating the impact this ASU will have on its financial statement disclosures.

Recent accounting guidance not discussed above is not applicable, did not have, or is not expected to have a material impact on the Company.

MINDS Acquisition - The Company entered into a Share Purchase Agreement, dated as of March 22, 2022, by and between MINDS Automation Group, Inc., a leader in plant automation control systems and cloud-based data management in the asphalt industry in Canada.

MINDS Acquisition - The Company entered into a Share Purchase Agreement, dated as of March 22, 2022, by and between MINDS Automation Group, Inc.

("MINDS"), a leader in plant automation control systems and cloud-based data management in the asphalt industry in Canada.

The acquisition was completed on April 1, 2022 at a purchase price of $ 19.3 million, which was paid in cash.

The Company's allocation of the purchase price resulted in the recognition of $ 9.3 million of goodwill and $ 9.3 million of intangible assets primarily consisting of customer relationships ( 9 year life) and developed technology ( 7 year life).

Significant inputs and assumptions used in determining the fair values of these intangible assets include management's forecasts of future revenues, earnings and cash flows, a discount rate based on the median weighted average cost of capital of the Company and select market competitors, and proportion of intangible assets acquired in relation to tangible assets.

Significant inputs and assumptions used in determining the fair values of these intangible assets include management's forecasts of future revenues, earnings and cash flows, a discount rate based on the median weighted average cost of capital of the Company and select market competitors, and the proportion of intangible assets acquired in relation to tangible assets.

Goodwill acquired is attributable to future growth opportunities provided by the acquired intellectual capital and the ability to generate cross-selling synergies.

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Proforma financial information is not included since not significant.

Acquisition and integration costs incurred were nominal during the year ended December 31, 2023 for this acquisition.

Acquisition and integration costs of $ 1.2 million were expensed as incurred during the year ended December 31, 2022 for this acquisition.

These costs are recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Table of Conten t s

The following table summarizes the allocations of the total purchase price:

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Total purchase price $ 19.3

CON-E-CO Acquisition - The Company entered into a Stock Purchase Agreement, dated as of July 20, 2020, by and between Oshkosh Corporation for the purchase of the CON-E-CO concrete equipment company in Nebraska.

The purchase price was $ 13.8 million, after adjustments, and was paid in cash.

The acquisition provides the Company with a broader line of concrete batch plant manufacturing, which will strengthen the Infrastructure Solutions segment.

Results of operations have been consolidated from the date of acquisition.

BMH Systems Acquisition - The Company entered into a Share Purchase Agreement, dated as of August 3, 2020, by and between BMH Systems Corporation ("St-Bruno") for the purchase of the concrete equipment company in Quebec, Canada.

The purchase price was $ 15.6 million, after adjustments, and was paid in cash.

The acquisition provides the Company with a broader line of concrete batch plant manufacturing, which will strengthen the Infrastructure Solutions segment.

Results of operations have been consolidated from the date of acquisition.

Grathwol Asset Acquisition - On November 2, 2020, t he Company closed a transaction pursuant to which it purchased certain assets of Grathwol Automation, LLC ("Grathwol").

Grathwol is engaged in the business of developing and providing advanced telematics and remote diagnostics for construction equipment and related products and services.

Assets purchased primarily comprise technology assets.

The total purchase price was $ 6.0 million, of which $ 1.8 million was deferred and will be recognized as expense and be paid out in two equal annual installments on the anniversary date of the acquisition.

Inventories consist of the following:

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Total $ 455.6 $ 393.4

During the year ended December 31, 2020, in conjunction with exiting the oil and gas drilling product lines, Enid's inventories were written down by $ 4.4 million, which was reported within "Cost of sales" in the Company's Consolidated Statements of Operations.

Table of Conten t s

Fair Value Measurements

The Company has various financial instruments that must be measured at fair value on a recurring basis, including marketable debt and equity securities held by Astec Insurance and marketable equity securities held in the Company's deferred compensation programs.

The Company's deferred compensation programs include a non-qualified Supplemental Executive Retirement Plan ("SERP") and a separate non-qualified Deferred Compensation Plan.

The Company's deferred compensation programs ("DCP") include a non-qualified Supplemental Executive Retirement Plan ("SERP") and a separate non-qualified Deferred Compensation Plan.

Although the deferred compensation programs' investments are allocated to individual participants, and investment decisions are made solely by those participants, they are non-qualified plans.

Consequently, the Company owns the assets and the related offsetting liability for disbursement until such time as a participant makes a qualifying withdrawal.

The deferred compensation programs' assets and related offsetting liability are recorded in non-current "Investments" and "Other long-term liabilities", respectively, in the Consolidated Balance Sheets.

The DCP assets and related offsetting liabilities are recorded in non-current "Investments" and "Other long-term liabilities", respectively, in the Consolidated Balance Sheets.

The Company's subsidiaries also occasionally enter into foreign currency exchange contracts to mitigate exposure to fluctuations in currency exchange rates.

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or inputs other than quoted prices that are observable for the asset or liability.

Level 3 - Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date.

Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

Level 3 - Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date.

As indicated in the tables below, the Company has determined that all of its financial assets and liabilities as of December 31, 2023 and 2022 are Level 1 and Level 2 in the fair value hierarchy as defined above:

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Corporate bonds 3.4 — 3.4

Municipal bonds — 0.3 0.3

Floating rate notes 0.2 — 0.2

Agency bonds — 2.5 2.5

government securities 1.9 — 1.9

Asset-backed securities — 4.0 4.0

Exchange traded funds 1.3 — 1.3

Mortgage backed securities — 0.5 0.5

Other 0.2 0.5 0.7

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Financial liabilities:

Derivative financial instruments $ — $ 0.1 $ 0.1

Deferred compensation programs' liabilities — 5.5 5.5

Total financial liabilities $ — $ 5.6 $ 5.6

Table of Conten t s

December 31, 2022

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Corporate bonds 5.0 — 5.0

Municipal bonds — 0.2 0.2

Floating rate notes 0.4 — 0.4

government securities 0.8 — 0.8

Asset-backed securities — 5.4 5.4

Exchange traded funds 1.3 — 1.3

Mortgage backed securities — 0.5 0.5

Other 0.2 0.5 0.7

Derivative financial instruments — 0.1 0.1

Total financial assets $ 12.6 $ 6.4 $ 19.0

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The Company's trading securities consist of the following:

(in millions) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Net Carrying Amount)

December 31, 2023

(in millions) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Net Carrying Amount)

Trading equity securities $ 5.1 $ 0.2 $ 0.1 $ 5.2

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December 31, 2022

(in millions) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Net Carrying Amount)

Trading equity securities $ 5.9 $ 0.1 $ 0.7 $ 5.3

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Trading equity investments are valued at their estimated fair value based on their quoted market prices, and trading debt securities are valued based upon a mix of observable market prices and model driven prices derived from a matrix of observable market prices for assets with similar characteristics obtained from a nationally recognized third-party pricing service.

Additionally, a significant portion of the trading equity securities are in mutual funds and also comprise a portion of the Company's liability under its deferred compensation programs.

See Note 14, Employee Benefit Plans, for additional information on these investments and the deferred compensation programs.

Additionally, a significant portion of the trading equity securities are in mutual funds and also comprise a portion of the Company's liability under its DCP.

See Note 14, Employee Benefit Plans, for additional information on these investments and the DCP.

Trading debt securities are comprised of marketable debt securities held by Astec Insurance.

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The goodwill impairment test is performed for each of the Company's four reporting units which have goodwill recorded.

Management elected to perform a quantitative assessment for the October 1, 2022 annual impairment analysis based on its decline in operating performance, declines in the Company's stock price and the overall macroeconomic environment.

Table of Conten t s

Company determined fair values of each reporting unit using an equally weighted combination of the discounted cash flow method, a form of the income approach, and the guideline public company method, a form of the market approach.

The significant assumptions used under the discounted cash flow method are projected net sales, projected earnings before interest, tax, depreciation and amortization (“EBITDA”), terminal growth rates, and the cost of capital.

Projected net sales, projected EBITDA and terminal growth rates were determined to be significant assumptions because they are primary drivers of the projected cash flows in the discounted cash flow fair value model.

Cost of capital was also determined to be a significant assumption as it is the discount rate used to calculate the current fair value of those projected cash flows.

For the guideline public company method, significant assumptions relate to the selection of appropriate guideline companies and related valuation multiples used in the market analysis.

Based on the Company's quantitative impairment test, no impairment at any of its reporting units was identified.

Although the Company believes the assumptions and estimates made are reasonable and appropriate, different assumptions and estimates could materially impact its reported financial results.

In addition, sustained declines in operating performance in certain reporting units or the Company's stock price and related market capitalization could impact key assumptions in the overall estimated fair values of its reporting units and could result in non-cash impairment charges that could be material to the Company's Consolidated Balance Sheets or Statements of Operations.

Should the carrying value of a reporting unit be in excess of the estimated fair value of that reporting unit, an impairment charge would be recorded to reduce the reporting unit to fair value.

Management performed a qualitative assessment for the annual tests of goodwill impairment performed on October 1, 2021 and October 31, 2020, the Company's prior annual goodwill impairment testing date, and concluded that there was no impairment of goodwill.

These reviews included the Company's evaluation of relevant events and circumstances in totality that affect the fair value of the reporting units.

These events and circumstances include, but were not limited to, macroeconomic conditions, industry and competitive environment conditions, overall financial performance, business specific events and market considerations.

Management elected to perform a qualitative assessment for the October 1, 2023 annual impairment analysis, which indicated no impairment at any of its reporting units.

This review included the Company's evaluation of relevant events and circumstances in totality that affect the fair value of the reporting units.

These events and circumstances include, but are not limited to, macroeconomic conditions, industry and competitive environment conditions, overall financial performance, business specific events and market considerations.

The majority of the Company's goodwill was generated on a legacy basis and as a result have fair values that sufficiently exceed their underlying carrying values.

Management performed a quantitative and a qualitative assessment for the annual tests of goodwill impairment performed on October 1, 2022 and 2021, respectively, and concluded that there was no impairment of goodwill.

The Company completed the acquisition of MINDS Automation Group, Inc.

during the year ended December 31, 2022, which increased goodwill $ 9.3 million.

In the first quarter of 2020, as part of the Company's ongoing assessment to consider whether events or circumstances had occurred that could more likely than not reduce the fair value of a reporting unit below its carrying value, the Company performed an interim goodwill impairment test as of March 31, 2020 over the mobile asphalt equipment reporting unit.

Based on the results of this testing, the Company recorded a $ 1.6 million pre-tax non-cash impairment charge in the Infrastructure Solutions segment to fully impair the mobile asphalt equipment reporting unit’s goodwill in the first quarter of 2020.

This impairment charge was reflected as a component of "Restructuring, impairment and other asset charges, net" for the year ended December 31, 2020.

Table of Conten t s

The changes in the carrying amount of goodwill and accumulated impairment losses by reporting segment during the years ended December 31, 2023 and 2022 are as follows:

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Foreign currency translation $ 0.2 $ 0.7 $ 0.2 $ 1.1

Acquisitions — — 9.3 9.3

Total 2023 activity

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2029 and thereafter 2.7

Table of Conten t s

Property and Equipment

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Operating lease liabilities $ 8.8

In February 2019, the Company and certain of its subsidiaries amended the 2012 amended and restated credit agreement with Wells Fargo Bank, N.A.

(the "Previous Credit Facility") whereby the lender increased the Company's unsecured line of credit to $ 150.0 million, including a sub-limit for letters of credit of up to $ 30.0 million, and extended the maturity date to December 29, 2023.

Borrowings under the agreement were subject to an interest rate equal to the daily one-month LIBOR rate plus a 0.75 %

Table of Conten t s

The unused facility fee was 0.125 %.

The Previous Credit Facility contained certain financial covenants, including provisions concerning required levels of annual net income and minimum tangible net worth.

On December 19, 2022, the Company and certain of its subsidiaries entered into a new credit agreement (the "Credit Agreement") with Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto.

The Credit Agreement provides for (i) a revolving credit facility (consisting of revolving credit loans and swingline loans) and a letter of credit facility, in an aggregate amount of up to $ 250.0 million, (ii) an incremental credit facility in an aggregate amount not to exceed $ 125.0 million (the “Credit Facilities”) and (iii) a maturity date of December 19, 2027.

Loans under the incremental credit facility shall have a maturity date as specified in the relevant incremental credit facility documentation.

Loans under the incremental credit facility

shall have a maturity date as specified in the relevant incremental credit facility documentation.

In connection with the entry into the Credit Facilities, the Company repaid all outstanding borrowings under the Previous Credit Facility.

The Company recorded total debt issuance costs for the Credit Facilities of $ 1.5 million of which $ 0.3 million are included in "Prepaid expenses and other assets" and $ 1.2 million are included in "Other long-term assets" in the Company's Consolidated Balance Sheets at December 31, 2022.

Unamortized debt issuance costs for the Credit Facilities total $ 1.2 million at December 31, 2023, of which $ 0.3 million are included in "Prepaid expenses and other assets" and $ 0.9 million are included in "Other long-term assets" in the Company's Consolidated Balance Sheets.

Debt issuance costs are amortized on a straight-line basis to "Interest expense" over the term of the Credit Facilities.

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The Company is also required to maintain a (i) Consolidated Total Net Leverage Ratio of not more than 3.50 to 1.00 as of the last day of any fiscal quarter which may be increased to 4.00 to 1.00 in connection with a permitted acquisition and subject to the terms of the Credit Agreement and (ii) Consolidated Interest Coverage Ratio of at least 2.50 to 1.00 as of the last day of any fiscal quarter.

The Company was in compliance with all covenants as of December 31, 2022.

The Company was in compliance with the financial covenants as of December 31, 2023.

The Credit Agreement contains events of default customary for this type of financing, including a cross default and cross acceleration provision to certain other material indebtedness of the Company and its subsidiaries.

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and/or secured with certain assets of the local subsidiary.

Table of Conten t s

Additional details for the Company's Credit Facilities, Previous Credit Facility, term loan and international credit facilities are summarized in total below:

Additional details for the Company's Credit Facilities, Term Loan and international credit facilities are summarized in total below:

(in millions, except maturity dates and interest rates) December 31, 2023 December 31, 2022

Credit Facilities and Previous Credit Facility, respectively

Credit Facilities

Line of credit - maximum $ 250.0 $ 250.0

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Weighted average interest rate 11.35 %

Debt maturities for the Company's short-term and long-term debt are expected to be as follows (in millions):

Debt maturities for the Company's long-term debt are expected to be as follows (in millions):

Product Warranty Reserves

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The Company accrues reserves for losses related to known workers' compensation and general liability claims that have been incurred but not yet paid or are estimated to have been incurred but not yet reported to the Company.

The undiscounted reserves are actuarially determined based on the Company's evaluation of the type and severity of individual claims and historical

Table of Conten t s

information, primarily its own claims experience, along with assumptions about future events.

The undiscounted reserves are actuarially determined based on the Company's evaluation of the type and severity of individual claims and historical information, primarily its own claims experience, along with assumptions about future events.

Changes in assumptions, as well as changes in actual experience, could cause these estimates to change in the future.

Total accrued loss reserves were $ 5.8 million, of which $ 3.9 million were included in "Other long-term liabilities" in the Consolidated Balance Sheets at both December 31, 2022 and 2021.

Total accrued loss reserves were $ 7.2 million and $ 5.8 million as of December 31, 2023 and December 31, 2022, respectively, of which $ 4.5 million and $ 3.9 million

were included in "Other long-term liabilities" in the Consolidated Balance Sheets as of December 31, 2023 and 2022, respectively.

Employee Benefit Plans

Deferred Compensation Programs

The Company's deferred compensation programs include a non-qualified SERP and a separate non-qualified Deferred Compensation Plan.

The Company's DCP includes a non-qualified SERP and a separate non-qualified Deferred Compensation Plan.

Supplemental Executive Retirement Plan

The Company maintains a SERP for certain of its executive officers.

The Company maintains a SERP for certain of its executive management.

The SERP has been closed to new entrants since December 2020.

This plan is a non-qualified deferred compensation plan administered by the Board of Directors of the Company, pursuant to which the Company makes quarterly cash contributions of a certain percentage of executive officers' compensation.

Investments are self-directed by participants and can include Company stock.

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Deferred Compensation Plan

The Company implemented a Deferred Compensation Plan for certain of its executive officers during 2021.

The Company maintains a Deferred Compensation Plan for certain of its executive and senior management.

This plan is a non-qualified deferred compensation plan administered by the Board of Directors of the Company, pursuant to which eligible employees can defer the receipt of base and bonus compensation to a future date.

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Total $ 5.4 $ 5.5 $ 6.2 $ 5.7

The Company periodically adjusts the deferred compensation liability related to the Deferred Compensation Programs such that the balance of the liability equals the total fair market value of all assets held by the trusts established under the programs.

The Company records an adjustment to the deferred compensation liability related to the DCP such that the balance of the liability equals the total fair market value of all assets held by the trusts established under the programs each period.

Such liabilities are included in "Other long-term liabilities" in the Consolidated Balance Sheets.

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however, the related liability is adjusted to the fair market value of the stock as of each period end.

The Company recognized income of $ 0.9 million in 2022 and expense of $ 0.5 million and $ 0.6 million in 2021 and 2020, respectively, related to the change in the fair value of the Company stock held in the Deferred Compensation Programs.

Other Employee Benefit Plan

The Company recognized income of $ 0.1 million and $ 0.9 million in 2023 and 2022, respectively, and expense of $ 0.5 million in 2021 related to the change in the fair value of the Company stock held in the DCP.

The Company sponsors a 401(k) defined contribution plan to provide eligible employees with additional income upon retirement.

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The Company's contributions totaled $ 8.1 million, $ 7.7 million and $ 7.2 million in 2023, 2022 and 2021, respectively.

Table of Conten t s

Prior to December 31, 2003, all employees of the Company's Kolberg-Pioneer, Inc.

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cash equivalents, fixed-income securities, domestic equities and international equities.

The Plan Committee attempted to ensure adequate diversification of the invested assets through investment in an exchange traded mutual fund that invests in a diversified portfolio of stocks, bonds and money market securities.

The Plan Committee attempted to ensure adequate diversification of the invested assets through investment in an exchange traded mutual fund that invested in a diversified portfolio of stocks, bonds and money market securities.

In October 2021, the Company settled its obligations under the Pension Plan by providing $ 5.5 million in lump sum payments to eligible participants who elected to receive them and through the purchase of annuity contracts from a highly rated insurance company for $ 12.2 million.

The settlement of the plan resulted in excess plan assets of approximately $ 1.5 million, which was subject to a 50 % excise tax.

A charge of $ 5.2 million, including excise tax, was recognized in the fourth quarter of 2021 in "Other (expenses) income, net" in the Consolidated Statements of Operations.

A charge of $ 5.2 million, including excise tax, was recognized in the fourth quarter of 2021 in "Other income (expenses), net" in the Consolidated Statements of Operations.

Details related to the Pension Plan through its termination date are presented herein.

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The Company recognized the overfunded or underfunded status of its pension plan as an asset or liability.

Actuarial gains and losses were recognized through "Other comprehensive (loss) income" in the year in which the changes occurred.

Actuarial gains and losses were recognized through "Other comprehensive income (loss)" in the year in which the changes occurred.

The Company measured the funded status of its pension plan as of the date of the Company's fiscal year-end.

Table of Conten t s

The following provides information regarding benefit obligations, plan assets and the funded status of the plan as of December 31, 2021:

Pension Benefits

(in millions) 2021

Change in benefit obligation:

Benefit obligation, beginning of year $ 18.4

Interest cost 0.4

Actuarial (gain) loss ( 0.3 )

Benefits paid ( 0.8 )

Pension settlement ( 17.7 )

Benefit obligation, end of year —

Accumulated benefit obligation —

Change in plan assets:

Fair value of plan assets, beginning of year 19.4

Actual gain on plan assets 0.6

Excess plan assets returned ( 1.5 )

Benefits paid ( 0.8 )

Pension settlement ( 17.7 )

Fair value of plan assets, end of year —

Funded status, end of year $ —

Amounts recognized in the consolidated balance sheets:

Long-term asset $ —

Net amount recognized $ —

Amounts recognized in accumulated other comprehensive loss consist of:

Net amount recognized $ —

Weighted average assumptions used to determine the benefit obligation:

Discount rate N/A

Rate of compensation increase N/A

Table of Conten t s

Net periodic benefit cost for 2021 and 2020 included the following components:

Pension Benefits

(in millions) 2021 2020

Components of net periodic benefit cost (income):

Net periodic benefit cost for 2021 included the following components:

(in millions) Pension Benefits

Components of net periodic benefit cost:

Interest cost $ 0.4

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Pension settlement 4.5

Net periodic benefit cost (income) $ 4.3 $ ( 0.1 )

Other changes in plan assets and benefit obligations recognized in other comprehensive (loss) income:

Net actuarial loss (gain) for the year $ — $ 0.4

Net periodic benefit cost $ 4.3

Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss):

Amortization of net loss $ ( 0.4 )

Pension settlement ( 4.5 )

Total recognized in other comprehensive (loss) income ( 4.9 ) —

Total recognized in net periodic benefit cost and other comprehensive (loss) income $ ( 0.6 ) $ ( 0.1 )

Weighted average assumptions used to determine net periodic benefit cost for years ended December 31:

Discount rate N/A 3.10 %

Expected return on plan assets N/A 6.00 %

Rate of compensation increase N/A N/A

Total recognized in other comprehensive income (loss) ( 4.9 )

Total recognized in net periodic benefit cost and other comprehensive income (loss) $ ( 0.6 )

To develop the expected long-term rate of return on assets assumptions, the Company considered the historical returns and future expectations for returns in each asset class, as well as targeted asset allocation percentages within the asset portfolios.

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Income before income taxes $ 42.8 $ 4.4 $ 13.8

Table of Conten t s

The provision (benefit) for income taxes consists of the following:

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15.5 22.1 ( 0.8 )

Deferred (benefit) provision:

Deferred benefit:

Federal ( 3.6 ) ( 18.3 ) ( 0.1 )

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Foreign — 2.2 ( 2.3 )

Total deferred (benefit) provision

Total deferred benefit

( 6.4 ) ( 17.1 ) ( 1.3 )

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The provision (benefit) for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before income taxes.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security ("CARES") Act was passed which modified the net operating loss ("NOL") carryback provisions allowing the Company to carryback its 2018 NOL to prior years.

The tax provision for the year ended December 31, 2020 includes a $ 9.5 million tax benefit related to the NOL carryback which occurred due to a change in rates from 35% to 21%.

A reconciliation of the provision (benefit) for income taxes at the statutory federal income tax rate to the amount provided is as follows:

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Research and development tax credits ( 2.8 ) ( 3.3 ) ( 4.1 )

FIN 48 impact 1.2 1.8 4.0

FIN 48 impact - liquidation of subsidiary — ( 0.7 ) —

Impact of uncertain tax positions 1.0 1.2 1.8

Impact of uncertain tax positions - liquidation of subsidiary — — ( 0.7 )

Change in foreign subsidiary net operating loss carryforward — — 4.4

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Changes in tax rates 0.8 0.2 0.7

Effects of Cares Act - 2018 NOL carryback — — ( 9.5 )

Share-based compensation 0.6 0.4 0.4

Foreign-derived intangible income deduction ( 0.7 ) ( 0.9 ) —

Foreign tax credit ( 0.5 ) ( 0.2 ) —

Other items 1.1 0.1 ( 0.7 )

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Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

Table of Conten t s

Significant components of the Company's deferred tax assets and liabilities are as follows:

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Deferred revenue 2.2 1.7

Deferred payroll tax - CARES Act — 1.1

Valuation allowances ( 12.5 ) ( 11.9 )

Other 0.9 1.5

Total deferred tax assets 54.5 48.6

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The Company has a deferred tax asset of $ 24.7 million for R&E expenditures as of December 31, 2023.

As of December 31, 2022, the Company had gross state NOL carryforwards of $ 227.8 million and gross foreign NOL carryforwards of approximately $ 23.8 million, which are available to offset future taxable income.

As of December 31, 2023, the Company had gross state net operating losses ("NOL") carryforwards of $ 222.1 million and gross foreign NOL carryforwards of approximately $ 26.5 million, which are available to offset future taxable income.

If not used, these carryforwards will expire between 2024 and 2035.

The Company does no t have a federal net operating loss carryforward.

A significant portion of the valuation allowance for deferred tax assets relates to the future utilization of state and foreign net operating loss and state tax credit carryforwards.

Future utilization of these net operating loss and state tax credit carryforwards is evaluated by the Company on a periodic basis, and the valuation allowance is adjusted accordingly.

In 2022, the valuation allowance on these carryforwards increased by $ 6.0 million, of which $ 5.5 million relates to a valuation allowance on the deferred tax assets of the Company's Brazilian subsidiary as the NOLs are not expected to be fully utilized.

The remaining change in valuation allowances is due to the unrealizable portion of certain entities’ state and foreign net operating loss carryforwards and certain other deferred tax assets in foreign jurisdictions.

Table of Conten t s

A significant portion of the valuation allowance for deferred tax assets relates to the future utilization of state and foreign NOL and state tax credit carryforwards.

Future utilization of these NOL and state tax credit carryforwards is evaluated by the Company on a periodic basis, and the valuation allowance is adjusted accordingly.

In 2023, the valuation allowance on these carryforwards increased by $ 0.6 million, of which $ 1.2 million relates to a valuation allowance on the deferred tax assets related to NOLs generated by the Company's United Kingdom subsidiary.

The remaining change in valuation allowances is due to the unrealizable portion of certain entities’ state and foreign NOL carryforwards and certain other deferred tax assets in foreign jurisdictions.

The following table represents a rollforward of the deferred tax asset valuation allowance for the years ended December 31, 2023, 2022 and 2021:

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The Company has a liability for unrecognized tax benefits of $ 13.0 million and $ 12.0 million (excluding accrued interest and penalties) as of December 31, 2023 and 2022, respectively.

The Company recognizes interest and penalties accrued related to unrecognized tax benefits in tax expense.

The Company recognizes interest and penalties accrued related to unrecognized tax benefits in "Interest expense" and "Selling, general and administrative expenses", respectively, in the Consolidated Statements of Operations.

The Company did not recognize any tax benefits for interest and penalties related to amounts that were settled for less than previously accrued in 2023 or 2022.

The net total amount of unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate is $ 13.7 million and $ 11.9 million at December 31, 2022 and 2021, respectively.

The net total amount of unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate is $ 15.7 million and $ 13.7 million at December 31, 2023 and 2022, respectively, and were included in "Other long-term liabilities" in the Consolidated Balance Sheets.

The Company does not expect a significant increase or decrease to the total amount of unrecognized tax benefits within the next twelve months.

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The tax positions in the December 31, 2023 balance of unrecognized tax benefits are expected to reverse through income in future years.

The Organization for Economic Cooperation and Development ("OECD") has made changes to many long-standing transfer pricing and cross-border taxation rules that affect the Company's operations.

The OECD has introduced a framework to implement a 15% global minimum corporate tax, referred to as Pillar 2.

The objective of Pillar 2 is for large multinational enterprises to pay a minimum level of tax on the income arising in each jurisdiction where they operate.

While it is uncertain whether the U.S.

will enact legislation to adopt Pillar 2 rules, some countries have enacted legislation and other countries are in the process of introducing legislation to implement Pillar 2.

Currently, Canada is the only country in which the Company operates that has released proposed legislation to implement Pillar 2.

The Company does not expect Pillar 2 to have a material impact on its effective tax rate, consolidated results of operations, financial position or cash flows.

Commitments and Contingencies

Certain customers have financed purchases of Company products through arrangements with third-party financing institutions in which the Company is contingently liable for customer debt of $ 2.4 million at both December 31, 2022 and 2021, respectively.

Certain customers have financed purchases of Company products through arrangements with third-party financing institutions in which the Company is contingently liable for customer debt of $ 1.1 million and $ 2.4 million as of December 31, 2023 and 2022, respectively.

These arrangements expire at various dates through September 2026.

Additionally, the Company is also contingently liable for 1.75 % of the unpaid balance, determined as of December 31 of the prior year (or approximately $ 0.1 million for 2023), on certain past customer equipment purchases that were financed by an outside finance company.

The agreements provide that the Company will receive the lender's full security interest in the equipment financed if the Company is required to fulfill its contingent liability under these arrangements.

The agreements provide that the Company will receive the lender's full security interest in the equipment financed if the Company is

required to fulfill its contingent liability under these arrangements.

The Company has recorded a liability of $ 0.6 million and $ 1.0 million related to these guarantees, which were included in "Other current liabilities" in the Consolidated Balance Sheets as of December 31, 2023 and 2022, respectively.

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The outstanding letters of credit expire at various dates through November 2024.

The maximum potential

Table of Conten t s

amount of future payments under letters of credit issued under the Credit Facilities for which the Company could be liable is $ 30.0 million as of December 31, 2022.

As of December 31, 2022, the Company's foreign subsidiaries are contingently liable for a total of $ 3.2 million in performance letters of credit, advance payments and retention guarantees, of which $ 0.7 million is secured by separate credit facilities with local financial institutions.

The maximum potential amount of future payments under these letters of credit and guarantees for which the Company could be liable is $ 9.5 million as of December 31, 2022.

Unused letters of credit under the Credit Facilities are $ 26.7 million as of December 31, 2023.

The Company is additionally contingently liable for a total of $ 7.2 million in performance letters of credit and retention guarantees primarily held by its foreign subsidiaries, of which $ 4.7 million are secured by separate credit facilities with various financial institutions as of December 31, 2023.

Unused letters of credit under these separate credit facilities is $ 8.4 million as of December 31, 2023.

The Company and certain of its former executive officers were named as defendants in a putative shareholder class action lawsuit filed on February 1, 2019, as amended on August 26, 2019, in the United States District Court for the Eastern District of Tennessee.

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On March 19, 2021, plaintiff filed a Motion to Alter or Amend the Judgment and For Leave to File the Proposed Amended Complaint, which was denied on May 5, 2021.

Plaintiff appealed the Motion to Dismiss and denial of its Motion to Alter or Amend the Judgment and For Leave to File the Proposed Amended Complaint to the United States Court of Appeals for the Sixth Circuit.

The plaintiff appealed the Motion to Dismiss and denial of its Motion to Alter or Amend the Judgment and For Leave to File the Proposed Amended Complaint to the United States Court of Appeals for the Sixth Circuit.

On March 31, 2022, the United States Court of Appeals for the Sixth Circuit issued an opinion reversing the dismissal of the Company and one former executive officer, affirming the dismissal of certain other former executive officers and remanding the action to the United States District Court for the Eastern District of Tennessee for proceedings consistent with the opinion.

On July 11, 2022 Defendants filed an answer to the complaint, and the action is now in discovery.

The Company's GEFCO subsidiary has been named a defendant in a lawsuit originally filed on August 16, 2018 with an amended complaint filed on January 25, 2019, in the United States District Court for the Western District of Oklahoma.

On July 11, 2022, the defendants filed an answer to the complaint, and the action is now in discovery.

The Company's GEFCO, Inc.

("GEFCO") subsidiary has been named a defendant in a lawsuit originally filed on August 16, 2018, with an amended complaint filed on January 25, 2019, in the United States District Court for the Western District of Oklahoma.

The action is styled VenVer S.A.

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The original purchase price of the equipment was approximately $ 8.5 million.

GEFCO disputes the plaintiff's allegations and intends to defend this lawsuit vigorously.

On July 7, 2020, the plaintiffs filed a separate lawsuit directly against Astec Industries, Inc.

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was dismissed.

The Company disputes the plaintiffs' allegations and is vigorously defending the GEFCO suit.

The Company and GEFCO each dispute the plaintiffs' allegations and are vigorously defending the GEFCO suit.

The Company is unable to determine whether or not a future loss will be incurred due to this litigation or estimate the possible loss or range of loss, if any, at this time.

In addition to the two matters noted above, the Company is currently a party to various other claims and legal proceedings that have arisen in the ordinary course of business.

If management believes that a loss arising from any claims and legal proceedings is probable and can reasonably be estimated, the Company records the amount of the loss (excluding estimated legal fees) or the minimum estimated liability when the loss is estimated using a range and no point within the range is more probable than another.

On October 5, 2023, a jury in the 355 th Judicial District Court, Hood County, State of Texas, rendered a verdict against the Company's Telsmith, Inc.

subsidiary in the matter styled 37 Building Products, Ltd.

Telsmith, Inc.

("Telsmith"), et al.

originally filed on January 28, 2019, with additional defendants later added.

All other defendants settled prior to trial except Telsmith.

37 BP alleged breaches of warranty and negligent misrepresentation regarding equipment manufactured by Telsmith and purchased by 37 BP in 2017 through one of the Company's dealers.

On December 19, 2023, a judgment was issued in the amount of $ 7.9 million (the “Judgment”) which takes into account credit for settlement amounts of all other defendants in this case.

Based on the jury verdict, management recorded a loss contingency of $ 6.4 million in "Selling, general and administrative expenses" in the Consolidated Statements of Operations and "Other current liabilities" in the Consolidated Balance Sheets during the third quarter of 2023 representing management's best estimate of the loss at that time.

During the fourth quarter of 2023, the loss contingency was increased $ 1.5 million based on the Judgment to a total of $ 7.9 million for the year ended December 31, 2023.

Telsmith filed a Motion for Judgment Notwithstanding the Verdict that the court denied on December 19, 2023.

Telsmith filed a Motion for New Trial and Motion for Remittitur on January 18, 2024.

The court denied Telsmith's motion for a new trial on February 9, 2024.

A supersedeas bond was filed on February 12, 2024 for approximately $ 4.2 million, which allows the Company to appeal the case in the Texas Court of Appeals.

In addition to the matters noted above, the Company is currently a party, and may become a party, to various other claims and legal proceedings in the ordinary course of business.

If management believes that a loss arising from any claims and legal proceedings is probable and can reasonably be estimated, the Company records the amount of the loss (excluding estimated legal fees) or, when the loss is estimated using a range and no point within the range is more probable than another, the minimum estimated liability.

As management becomes aware of additional information concerning such contingencies, any potential liability related to these matters is assessed and the estimates are revised, if necessary.

If management believes that a loss arising from such claims and legal proceedings is either:

(i) probable but cannot be reasonably estimated or (ii) reasonably estimable but not probable, the Company does not record the amount of the loss but does make specific disclosure of such matter.

If management believes that a

loss arising from such claims and legal proceedings is either (i) probable but cannot be reasonably estimated or (ii) reasonably estimable but not probable, the Company does not record the amount of the loss but does make specific disclosure of such matter.

Based upon currently available information and with the advice of counsel, management believes that the ultimate outcome of its current claims and legal proceedings, individually and in the aggregate, will not have a material adverse effect on the Company's financial position, cash flows or results of operations.

4 unchanged sentences

The 2011 Plan authorized the grant of options, share appreciation rights, restricted stock, restricted stock units, deferred stock units, performance awards, dividend equivalents and other share-based and cash awards.

Under the 2011 Plan, the Company has outstanding restricted stock units, performance stock units and deferred stock units none of which participate in Company-paid dividends.

Under the 2011 Plan, the Company had restricted stock units, performance stock units and deferred stock units, none of which participated in Company-paid dividends.

All outstanding awards under the 2011 Plan vested or were forfeited during 2023.

On April 27, 2021 ("Plan Effective Date"), the Company's shareholders approved the 2021 Equity Incentive Plan ("2021 Plan"), which is administered by the Company's Compensation Committee of the Board of Directors (the "Compensation Committee").

The 2021 Plan provides for a total of 1,280,000 shares to be reserved and available for issuance pursuant to the grant of new awards under the 2021 Plan.

To the extent that all or a portion of an award (or, after December 31, 2020, an award granted under the 2011 Plan) is canceled, terminates, expires, is forfeited or lapses for any reason (including by reason of failure to meet time-based and/or performance-based vesting requirements), any unissued or forfeited shares originally subject to the award will be added back to the 2021 Plan share reserve and again be available for issuance pursuant to awards granted under the 2021

Table of Conten t s

The 2021 Plan authorizes the grant of options, share appreciation rights, restricted stock, restricted stock units, deferred stock units, performance awards, dividend equivalents and other share-based and cash awards.

Awards granted under the 2021 Plan may provide for dividend equivalents, which are subject to the same forfeiture, transfer restrictions and deferral terms as apply to the award to which they relate.

Awards granted under the 2021 Plan provide for dividend equivalents, which are subject to the same forfeiture, transfer restrictions and deferral terms as apply to the award to which they relate.

Share-based compensation expense of $ 4.1 million, $ 6.8 million and $ 6.0 million was recorded in the years ended December 31, 2023, 2022 and 2021, respectively, and recognized in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Restricted Stock Units ("RSUs")

Prior to 2020, key members of management were awarded with restricted stock units ("RSUs") each year based upon the financial performance of the Company and its subsidiaries.

Beginning in 2020, awards were determined based on a predetermined award value of the base salary of eligible employees aligned to a total compensation program.

Restricted stock unit awards generally vest ratably, at the end of each 12-month period, over a three-year service period.

A participant generally must be employed by the Company on the vesting date of each award, however, awards will vest if employment terminates earlier on account of a qualifying employment termination event such as death, disability and retirement at age 65 .

Additional RSUs are granted on an annual basis to the Company's outside directors under the Company's Non-Employee Directors Compensation Plan generally with a one-year vesting period.

Prior to 2020, key members of management were awarded with RSUs each year based upon the financial performance of the Company and its subsidiaries.

Beginning in 2020, awards have been determined based on a predetermined award value of the base salary of eligible employees aligned to a total compensation program.

RSUs awards generally vest ratably, at the end of each 12-month period, over a three-year service period.

Additional RSUs are granted on an annual basis to the Company's outside directors under the 2021 Plan generally with a one-year vesting period.

Changes in restricted stock units during the year ended December 31, 2023 are as follows:

11 unchanged sentences

Tax (expense) benefit for restricted stock compensation expense $ ( 0.4 ) $ ( 0.1 ) $ 3.8

As of December 31, 2022, the Company had $ 6.3 million of unrecognized compensation expense before tax related to restricted stock units, which is expected to be recognized over a weighted average period of 1.8 years.

As of December 31, 2023, the Company had $ 3.1 million of unrecognized compensation expense before tax related to RSUs, which is expected to be recognized over a weighted average period of 1.7 years.

Performance Stock Units ("PSUs")

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Vesting is subject to both the continued employment of the participant with the Company and the achievement of certain performance metrics established by the Compensation Committee.

A participant generally must be employed by the Company on the vesting date of each award, however, a portion of a participant's awards will vest if employment terminates earlier on account of a qualifying employment termination event such as death, disability and retirement at age 65 .

PSUs granted in 2020 were divided into three equal tranches with cliff vesting periods of one year , two years and three years .

Awards granted beginning in 2021 generally cliff vest three years from the date of grant.

The number of PSUs that vest may range from zero to 200 % of the target shares granted and is determined for each tranche based on the achievement of two equally weighted performance criteria:

The number of PSUs that vest may range from zero to 200 % of the target shares granted and is determined for each award based on the achievement of two equally weighted performance criteria:

ROIC and TSR.

The PSUs are settled in common stock of the Company, with holders receiving one common share for each PSU that vests.

Table of Conten t s

Changes in PSUs during the year ended December 31, 2023 are as follows:

5 unchanged sentences

Unvested as of December 31, 2023 106 $ 56.72

* The vested PSUs presented are based on the target amount of the award for the second tranche of the 2020 awards.

In accordance with the terms of the underlying award agreements, the actual shares earned and distributed for the two-year performance period ended during 2022 was 121 % of the target shares granted, rounded up the nearest whole share.

* The vested PSUs presented are based on the target amount of the award for the third tranche of the 2020 awards and for the awards that were modified in conjunction with the termination of the Company's previous Chief Executive Officer and the limited overhead restructuring action implemented in February 2023.

In accordance with the terms of the underlying award agreements, the actual shares earned and distributed for the performance periods ended during 2023 was 83 % of the target shares granted, rounded to the nearest whole share.

The following additional activity occurred for the Company's performance stock units:

3 unchanged sentences

Fair value of awards vested and issued $ 1.6 $ 1.7 $ 4.5

Tax benefit for performance stock compensation expense $ 0.2 $ 2.3 $ —

Tax (expense) benefit for performance stock compensation expense $ ( 1.0 ) $ 0.2 $ 2.3

As of December 31, 2023, the Company had $ 2.4 million of unrecognized compensation expense before tax related to PSUs, which is expected to be recognized over a weighted average period of 1.9 years.

4 unchanged sentences

The 2021 Plan and the 2011 Equity Incentive Plan allow for certain participants to elect to receive vested units on a deferred basis.

As of December 31, 2022, there were 10,383 fully vested deferred stock units, which are excluded from the unvested balances as of December 31, 2022 in the tables above.

As of December 31, 2023, there were 8,234 fully vested deferred stock units, which are excluded from the unvested

balances as of December 31, 2023 in the tables above.

The aggregate fair value of these units at December 31, 2023 was $ 0.3 million.

Table of Conten t s

Revenue Recognition

38 unchanged sentences

Total net sales $ 847.4 $ 422.7 $ 4.4 $ 1,274.5

Table of Conten t s

For the Year Ended December 31, 2021

18 unchanged sentences

As of December 31, 2023, the Company had contract assets of $ 3.7 million and contract liabilities, excluding customer deposits, of $ 5.6 million, of which $ 0.8 million was deferred revenue related to extended warranties.

As of December 31, 2021, the Company had contract assets of $ 3.2 million and contract liabilities, excluding customer deposits, of $ 5.6 million, of which $ 2.7 million was deferred revenue related to extended warranties.

As of December 31, 2022, the Company had contract assets of $ 3.8 million and contract liabilities, excluding customer deposits, of $ 5.5 million, of which $ 2.9

million was deferred revenue related to extended warranties.

Total extended warranty sales were $ 1.1 million, $ 1.1 million and $ 1.5 million in 2023, 2022 and 2021, respectively.

1 unchanged sentence

The Company has two reportable segments, each of which 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.

Based on a review of these factors, the Company's India and Thailand sites changed reportable segments beginning January 1, 2022.

The India site was previously incorporated into the Materials Solutions segment and has moved to the Infrastructure Solutions segment while the Thailand site, which was previously included in the Infrastructure Solutions segment, has moved to the Materials Solutions segment.

Beginning January 1, 2022, the measure of segment profit or loss used by the Company's Chief Executive Officer, whom is determined to be the chief operating decision maker ("CODM"), to evaluate performance and allocate resources to the operating segments changed to Segment Operating Adjusted EBITDA.

Segment Operating Adjusted EBITDA is the measure of segment profit or loss used by the Company's Chief Executive Officer, whom is determined to be the chief operating decision maker ("CODM"), to evaluate performance and allocate resources to the operating segments is Segment Operating Adjusted EBITDA.

Segment Operating Adjusted EBITDA, a non-GAAP financial measure, is defined as net income or loss before the impact of interest income or expense, income taxes, depreciation and amortization and certain other adjustments that are not considered by the CODM in the evaluation of ongoing operating performance.

The Company's presentation of Segment Operating Adjusted EBITDA may not be comparable to similar measures used by other companies and is not necessarily indicative of the results of operations that would have occurred had each reportable segment been an independent, stand-alone entity during the periods presented.

Prior periods have been revised to reflect both the segment composition change and the segment profit or loss metric noted above for comparability.

During the first quarter of 2022, the Company revised the allocation of certain of its functional expenses between the Corporate and Other category and the reportable segments primarily related to the Company's annual incentive compensation.

Prior periods have not been revised for this change.

Table of Conten t s

A brief description of each segment is as follows:

6 unchanged sentences

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 foreign and domestic governmental agencies.

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.

Corporate and Other - The Corporate and Other category consists primarily of the parent company, the Company's captive insurance company, Astec Insurance, and Astec Digital, the controls and automation business including the MINDS 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.

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 of the Company's other segments.

The controls and automation business manufactures hardware and software products that are marketed independently and included in certain products of the Company's other segments.

The accounting policies of the reportable segments are the same as those described in Note 2, Basis of Presentation and Significant Accounting Policies.

14 unchanged sentences

Capital expenditures 28.9 11.1 0.7 40.7

Table of Conten t s

Segment information for 2021:

8 unchanged sentences

(in millions) 2023 2022 2021

Net (loss) income attributable to controlling interest

Segment Operating Adjusted EBITDA $ 111.7 $ 71.0 $ 64.8

Transformation program ( 29.2 ) ( 25.5 ) ( 13.4 )

Curtailment and settlement (loss) gain on pension and postretirement benefits, net — ( 4.7 ) 0.5

Curtailment and settlement loss on pension and postretirement benefits, net — — ( 4.7 )

Restructuring and other related charges ( 7.7 ) ( 6.2 ) ( 2.9 )

5 unchanged sentences

Income tax provision (benefit) ( 9.1 ) ( 5.0 ) 2.1

Net loss (income) attributable to noncontrolling interest 0.5 ( 0.1 ) —

Net (income) loss attributable to noncontrolling interest ( 0.2 ) 0.5 ( 0.1 )

(Elimination) recapture of intersegment profit ( 1.5 ) ( 0.7 ) 0.4

Net (loss) income attributable to controlling interest $ ( 0.1 ) $ 15.8 $ 46.0

Net income (loss) attributable to controlling interest $ 33.5 $ ( 0.1 ) $ 15.8

Total segment assets $ 2,623.3 $ 2,412.6 $ 2,308.1

4 unchanged sentences

Total consolidated assets $ 1,059.3 $ 1,014.4 $ 905.8

Table of Conten t s

Sales into major geographic regions were as follows:

5 unchanged sentences

Africa 36.6 36.1 33.9

Other European Countries 28.0 32.7 23.2

Brazil 27.0 24.8 21.5

Other European Countries 26.2 28.0 32.7

South America (excluding Brazil) 19.8 20.0 15.2

Mexico 8.4 10.7 13.5

Central America (excluding Mexico) 10.7 3.9 1.3

Other Asian Countries 7.7 10.3 5.4

Middle East 4.9 3.1 2.9

India 2.9 2.7 0.5

Central America (excluding Mexico) 4.1 10.7 3.9

West Indies 2.5 0.4 1.3

Post-Soviet States (excluding Russia) 2.5 2.7 3.6

India 0.6 2.9 2.7

Japan and Korea 0.3 0.4 2.7

West Indies 0.4 1.3 6.1

Russia — 0.3 2.6

China 0.1 0.4 1.2

Other — 0.1 —

12 unchanged sentences

Total property and equipment, net $ 187.6 $ 173.6

Accumulated Other Comprehensive Loss

"Accumulated other comprehensive loss" is comprised of foreign currency translation adjustments of $ 40.1 million and $ 32.4 million as of December 31, 2022 and 2021, respectively.

Table of Conten t s

Other Expenses and Income

Other (expenses) income, net, consists of the following:

Other Income and Expenses

Other income (expenses), net, consists of the following:

Years Ended December 31,

(in millions) 2023 2022 2021

Foreign exchange (losses) gains, net $ ( 0.9 ) $ ( 0.5 ) $ 1.3

Investment loss, net ( 0.9 ) ( 0.3 ) —

Curtailment and settlement (loss) gain on pension and postretirement benefits, net — ( 4.7 ) 0.5

Gain on disposal of subsidiary — — 1.6

Foreign exchange gains (losses), net $ 0.7 $ ( 0.9 ) $ ( 0.5 )

Investment income (loss), net 0.2 ( 0.9 ) ( 0.3 )

Curtailment and settlement loss on pension and postretirement benefits, net — — ( 4.7 )

Other, net 0.1 0.2 —

1 unchanged sentence

Strategic Transformation and Restructuring, Impairment and Other Asset Charges

The Company's Simplify, Focus and Grow Strategic Transformation ("SFG") initiative, which began in 2019, generally includes facility rationalization, asset impairment, workforce reduction, the associated costs of organizational integration activities and strategic transformational initiatives.

As part of the SFG initiative several strategic decisions have been made to divest of underperforming manufacturing sites or product lines, including to close certain subsidiaries, close and sell manufacturing sites and relocate the product lines manufactured at each of these sites to other Company locations;

exit the oil, gas and water well product lines;

and sell certain assets, which are included in "Restructuring, impairment and other asset charges, net" on the Company's Consolidated Statements of Operations.

The Company also has a multi-year phased implementation of a standardized enterprise resource planning ("ERP") system across the global organization underway, which will replace much of the existing disparate core financial systems.

The Company's strategic transformation program includes two ongoing initiatives.

The Company is undergoing a multi-year phased implementation of a standardized enterprise resource planning ("ERP") across the global organization, which will replace

much of the existing disparate core financial systems.

The upgraded ERP will initially convert 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 the Company to better leverage automation and process efficiency.

An implementation of this scale is a major financial undertaking and requires substantial time and attention of management and key employees.

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

This improvement is intended to serve as the optimal blueprint for the Company's other manufacturing facilities.

Costs incurred related to these strategic transformational initiatives were $ 25.5 million and $ 13.4 million in 2022 and 2021, respectively, and are recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Deferred implementation costs associated with the ERP implementation total $ 17.8 million, of which $ 1.2 million and $ 16.6 million were included in "Prepaid expenses and other assets" and "Other long-term assets" in the Consolidated Balance Sheets as of December 31, 2022, respectively.

Deferred implementation costs totaled $ 1.3 million and were included in "Other long-term assets" in the Consolidated Balance Sheets as of December 31, 2021.

These deferred implementation costs will be amortized ratably over the remaining contract term once the ERP is ready for use.

Additionally, beginning in the first quarter of 2022, a lean manufacturing initiative at one of the Company's largest sites was initiated.

Total costs of $ 29.7 million were incurred related to these strategic transformation initiatives in 2023, of which $ 29.4 million and $ 0.3 million are recorded in "Selling, general and administrative expenses" and "Cost of sales", respectively, in the Consolidated Statements of Operations.

Costs totaling of $ 25.5 million and $ 13.4 million were incurred in 2022 and 2021, respectively, and are recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Capitalized implementation costs associated with the ERP implementation totaled $ 30.6 million, of which $ 3.3 million and $ 27.3 million were included in "Prepaid expenses and other assets" and "Other long-term assets", respectively, in the Consolidated Balance Sheets as of December 31, 2023.

Capitalized implementation costs totaled $ 17.8 million, of which $ 1.2 million and $ 16.6 million were included in "Prepaid expenses and other assets" and "Other long-term assets", respectively, in the Consolidated Balance Sheets as of December 31, 2022.

Amortization of these capitalized implementation costs totaled $ 1.9 million during 2023, which is included in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

In addition, the Company periodically sells or disposes of its assets in the normal course of its business operations as they are no longer needed or used and may incur gains or losses on these disposals.

1 unchanged sentence

The Company reports asset impairment charges and gains or losses on the sales of property and equipment collectively, with restructuring charges in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations to the extent they are experienced.

Table of Conten t s

The restructuring, asset impairment charges and net gain on sale of property and equipment incurred in 2023, 2022 and 2021 are as follows:

2 unchanged sentences

Restructuring related charges:

Costs associated with leadership change $ 4.4 $ — $ —

Costs associated with closing Enid 1.0 0.7 2.5

Costs associated with leadership change and overhead restructuring $ 7.3 $ 4.4 $ —

Costs associated with exited operations - Enid 0.4 1.0 0.7

Costs associated with closing Tacoma — 0.8 1.6

Costs associated with closing Mequon — — 0.6

Costs associated with closing Albuquerque — — 1.3

Costs associated with closing AMM — — 0.3

Workforce reductions at multiple sites — — 1.3

Other restructuring charges — — 0.3

Total restructuring related charges 7.7 6.2 2.9

Asset impairment charges:

Airplane impairment charges — — 2.3

Goodwill impairment charges — — 1.6

Other impairment charges 1.2 3.5 0.2

25 unchanged sentences

Restructuring charges accrued, but not paid, were $ 0.1 million and $ 4.7 million as of December 31, 2023 and December 31, 2022, respectively.

Table of Conten t s

In late 2019, the oil and gas drilling product lines produced at the Enid, Oklahoma location ("Enid") were impaired and discontinued.

Additional restructuring costs of $ 1.0 million, $ 0.7 million and $ 2.5 million were incurred during 2022, 2021 and 2020, respectively.

Enid's land and building assets totaling $ 5.1 million were included in "Assets held for sale" in the Consolidated Balance Sheets as of December 31, 2021.

An impairment charge of $ 0.4 million was incurred during 2022 to record these assets at fair value less costs to sell.

The property sold in the fourth quarter of 2022 for approximately $ 4.7 million.

In late 2019, the oil and gas drilling product lines produced at the Company's Enid, Oklahoma location ("Enid") formally included in the Company's Infrastructure Solutions segment, were impaired and discontinued.

The sale of the land and building assets was completed in the fourth quarter of 2022 for approximately $ 4.7 million.

In October 2020, the Company closed a transaction for the sale of Enid's water well assets, which included equipment, inventories and intangible assets.

The purchase price for this transaction was approximately $ 6.9 million, net of purchase price adjustments completed in January 2021 whereby the Company had an obligation to pay the buyer $ 1.1 million.

Additional purchase price adjustments related to this sale were completed in January 2021 whereby the Company had an obligation to pay the buyer $ 1.1 million.

This obligation was settled in the first quarter of 2021.

In June 2020, the Company announced the closing of the Mequon site in order to simplify and consolidate operations.

The Mequon facility ceased production operations in August 2020, and the sale of the land and building for $ 8.5 million was completed in December 2020.

The Company recorded a gain on the sale of $ 4.7 million, which was recorded in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations during the fourth quarter of 2020.

Charges primarily related to production facility transition activities of $ 0.6 million were incurred during 2021.

In January 2021, the Company announced plans to close the Tacoma facility in order to simplify and consolidate operations.

1 unchanged sentence

The transfer of the manufacturing and marketing of Tacoma product lines to other facilities within the Infrastructure Solutions segment was completed during the first quarter of 2022.

In conjunction with this action, the Company recorded $ 0.8 million, $ 1.6 million and $ 0.9 million of restructuring related charges during 2022, 2021 and 2020, respectively, in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations.

The Tacoma facility's land, building and certain equipment assets of $ 15.4 million, which are currently being actively marketed for sale, are recorded as held for sale in its Consolidated Balance Sheets at December 31, 2022.

During the second quarter of 2022, the Company determined that certain manufacturing equipment contracted to be constructed by a third-party vendor, which had been prepaid, would not be recovered.

Impairment charges of $ 2.1 million were recorded in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations during the three months ended June 30, 2022.

An additional $ 0.9 million of impairment charges were incurred related to abandoned in-process internally developed software that was determined to be impaired during the second quarter of 2022.

Effective as of January 6, 2023, Mr.

In conjunction with this action, the Company recorded $ 0.8 million and $ 1.6 million of restructuring related charges during 2022 and 2021, respectively, in " Restructuring, impairment and other asset charges, net " in the Consolidated Statements of Operations.

The Company recorded the Tacoma facility's land, building and certain equipment assets of $ 15.4 million as held for sale in its Consolidated Balance Sheets as of December 31, 2022.

The sale of these assets was completed in the first quarter of 2023 for $ 19.9 million.

The Company recorded a gain on the sale of $ 3.4 million, which was recorded in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations.

During the second quarter of 2022, the Company determined that certain manufacturing equipment contracted to be constructed by a third-party vendor for a site within the Infrastructure Solutions segment, which had been prepaid, would not be recovered.

As such, impairment charges of $ 2.1 million were recorded in " Restructuring, impairment and other asset charges, net " in the Consolidated Statements of Operations during 2022.

Effective January 6, 2023, Mr.

Ruffalo's employment as President and Chief Executive Officer was terminated.

1 unchanged sentence

Ruffalo (the "Separation Agreement") pursuant to which, Mr.

Ruffalo is entitled to certain severance payments and benefits.

For the year ended December 31, 2022, there were $ 4.4 million of restructuring costs incurred related to Mr.

Ruffalo's separation in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations.

Ruffalo was entitled to certain severance payments and benefits.

There were $ 4.4 million of restructuring costs incurred related to Mr.

Ruffalo's separation during the year ended December 21, 2022, with an additional $ 1.8 million of restructuring costs, related to the modification of Mr.

Ruffalo's equity awards and other third-party transition support costs incurred in the year ended December 31, 2023, which were recorded in " Restructuring, impairment and other asset charges, net " in the Consolidated Statements of Operations.

The related recovery of $ 1.6 million of previously incurred share-based compensation expense was recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations during the first quarter of 2023.

The Separation Agreement also includes a release and waiver by Mr.

Ruffalo and other customary provisions.

Additional costs are anticipated to be incurred in the first quarter of 2023 for this separation related to the modification of Mr.

Ruffalo's equity awards as well as third-party transition support costs.

Management continually reviews the Company's organizational structure and operations to ensure they are optimized and aligned with achieving near-term and long-term operational and profitability targets.

In connection with this review, in February 2023, the Company implemented a limited restructuring plan to right-size and reduce the fixed cost structure of certain overhead departments.

Charges of $ 3.0 million to $ 4.0 million for employee termination costs, excluding equity award modifications, are anticipated to be incurred primarily in the first quarter of 2023.

Table of Conten t s

Total charges of $ 5.5 million for employee termination costs, including equity award modifications, were recorded in " Restructuring, impairment and other asset charges, net " in the Consolidated Statements of Operations.

The related recovery of $ 1.0 million of previously incurred share-based compensation expense was recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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 8. Financial Statements and Supplementary Data