What changed in this filing

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Item 1. Financial Statements

2025-04-29 compared with 2024-11-07 · 197 added, 320 removed, 314 unchanged (62% of the section changed)

3 unchanged sentences

(In millions, except share and per share data, unaudited)

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Current assets:

1 unchanged sentence

Investments 2.8 3.0

Trade receivables, contract assets and other receivables, net of allowance for credit losses of $ 3.3 at each date

Trade receivables, contract assets and other receivables, net of allowance for credit losses of $ 2.1 and $ 2.3 , respectively

Inventories 434.9 422.7

11 unchanged sentences

Current liabilities:

Current maturities of long-term debt $ — $ 0.1

Short-term debt $ 11.5 $ 13.3

14 unchanged sentences

Common stock – authorized 40,000,000 shares of $ 0.20 par value;

issued and outstanding – 22,801,785 as of September 30, 2024 and 22,740,635 as of December 31, 2023

issued and outstanding – 22,840,087 as of March 31, 2025 and 22,803,976 as of December 31, 2024

Additional paid-in capital 144.0 142.9

10 unchanged sentences

(In millions, except share and per share data, unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Net sales $ 329.4 $ 309.2

2 unchanged sentences

Selling, general and administrative expenses 71.9 71.4

Goodwill impairment — — 20.2 —

Restructuring, other impairment and asset charges, net 8.4 0.5 8.3 5.3

(Loss) income from operations ( 7.2 ) ( 5.2 ) ( 11.6 ) 29.7

Restructuring and other asset gains, net — ( 0.8 )

Income from operations 20.5 6.3

Other expenses, net:

2 unchanged sentences

Other income, net 0.6 0.5

(Loss) income before income taxes ( 8.5 ) ( 7.1 ) ( 17.5 ) 25.3

Income tax (benefit) provision ( 2.3 ) ( 0.6 ) ( 0.6 ) 6.5

Net (loss) income ( 6.2 ) ( 6.5 ) ( 16.9 ) 18.8

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

Net (loss) income attributable to controlling interest $ ( 6.2 ) $ ( 6.6 ) $ ( 16.8 ) $ 18.6

Income before income taxes 19.7 4.7

Income tax provision 5.4 1.4

Net income 14.3 3.3

Net loss attributable to noncontrolling interest — 0.1

Net income attributable to controlling interest $ 14.3 $ 3.4

Per share data:

(Loss) earnings per common share - Basic $ ( 0.27 ) $ ( 0.29 ) $ ( 0.74 ) $ 0.82

(Loss) earnings per common share - Diluted $ ( 0.27 ) $ ( 0.29 ) $ ( 0.74 ) $ 0.82

Earnings per common share - Basic $ 0.63 $ 0.15

Earnings per common share - Diluted $ 0.62 $ 0.15

Weighted average shares outstanding - Basic 22,833,292 22,762,098

2 unchanged sentences

ASTEC INDUSTRIES, INC.

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

(In millions, unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Net (loss) income $ ( 6.2 ) $ ( 6.5 ) $ ( 16.9 ) $ 18.8

Three Months Ended March 31,

Net income $ 14.3 $ 3.3

Other comprehensive income (loss):

1 unchanged sentence

Other comprehensive income (loss) 3.1 ( 4.4 )

Comprehensive (loss) income ( 0.4 ) ( 11.1 ) ( 16.9 ) 14.8

Comprehensive loss (income) attributable to noncontrolling interest — ( 0.1 ) 0.3 ( 0.3 )

Comprehensive (loss) income attributable to controlling interest $ ( 0.4 ) $ ( 11.2 ) $ ( 16.6 ) $ 14.5

Comprehensive income (loss) 17.4 ( 1.1 )

Comprehensive (income) loss attributable to noncontrolling interest ( 0.1 ) 0.1

Comprehensive income (loss) attributable to controlling interest $ 17.3 $ ( 1.0 )

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

2 unchanged sentences

(In millions, unaudited)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities:

Net (loss) income $ ( 16.9 ) $ 18.8

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

Net income $ 14.3 $ 3.3

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

Depreciation and amortization 6.4 6.5

1 unchanged sentence

Provision for warranties 6.2 4.2

Deferred compensation (benefit) expense ( 0.1 ) 0.2

Deferred compensation expense — 0.1

Share-based compensation 1.7 1.2

Deferred tax benefit ( 1.0 ) ( 2.0 )

Gain on disposition of property and equipment, net ( 1.1 ) ( 3.1 )

Goodwill impairment 20.2 —

Other impairment charges — 0.8

Gain on sale of property and equipment, net — ( 0.9 )

Amortization of debt issuance costs 0.1 0.1

Distributions to deferred compensation programs' participants ( 0.8 ) ( 1.5 )

Change in operating assets and liabilities:

Purchase of trading securities, net ( 1.6 ) ( 1.4 )

Sale (purchase) of trading securities, net 0.2 ( 2.2 )

Receivables and other contract assets ( 3.9 ) ( 39.1 )

9 unchanged sentences

Income taxes payable/prepaid 5.8 3.5

Net cash used in operating activities ( 13.6 ) ( 18.8 )

Net cash provided by (used in) operating activities 20.5 ( 47.0 )

Cash flows from investing activities:

7 unchanged sentences

(In millions, unaudited)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from financing activities:

2 unchanged sentences

Repayments of borrowings on credit facilities and bank loans ( 106.9 ) ( 16.7 )

Sale of Company stock by deferred compensation programs, net 0.2 0.1

Withholding tax paid upon vesting of share-based compensation awards ( 0.7 ) ( 0.4 )

Net cash provided by financing activities 19.5 30.8

Net cash (used in) provided by financing activities ( 15.0 ) 48.4

Effect of exchange rates on cash 0.5 ( 0.6 )

(Decrease) increase in cash, cash equivalents and restricted cash ( 7.9 ) 7.8

Increase (decrease) in cash, cash equivalents and restricted cash 1.8 ( 5.1 )

Cash, cash equivalents and restricted cash, beginning of period 90.8 63.2

15 unchanged sentences

Balance, December 31, 2024 22,803,976 $ 4.6 $ 142.9 $ ( 51.1 ) $ ( 0.3 ) $ 541.7 $ ( 0.2 ) $ 637.6

Net income (loss) — — — — — 3.4 ( 0.1 ) 3.3

Other comprehensive loss — — — ( 4.4 ) — — — ( 4.4 )

Net income — — — — — 14.3 — 14.3

Other comprehensive income — — — 3.0 — — 0.1 3.1

Dividends ($ 0.13 per share)

4 unchanged sentences

Balance, March 31, 2025 22,840,087 $ 4.6 $ 144.0 $ ( 48.1 ) $ ( 0.3 ) $ 553.0 $ ( 0.1 ) $ 653.1

Net loss — — — — — ( 14.0 ) — ( 14.0 )

Other comprehensive loss — — — ( 1.2 ) — — ( 0.2 ) ( 1.4 )

Dividends ($ 0.13 per share)

— — — — — ( 3.0 ) — ( 3.0 )

Share-based compensation — — 1.1 — — — — 1.1

Issuance of common stock under incentive plan 35,618 0.1 — — — — — 0.1

Withholding tax paid upon equity award vesting — — ( 0.1 ) — — — — ( 0.1 )

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

Balance, June 30, 2024 22,800,581 $ 4.6 $ 140.3 $ ( 43.7 ) $ ( 0.7 ) $ 532.8 $ — $ 633.3

Net loss — — — — — ( 6.2 ) — ( 6.2 )

Other comprehensive income — — — 5.8 — — — 5.8

Dividends ($ 0.13 per share)

— — — — — ( 3.0 ) — ( 3.0 )

Share-based compensation — — 1.4 — — — — 1.4

Issuance of common stock under incentive plan 1,204 — — — — — — —

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

Balance, September 30, 2024 22,801,785 $ 4.6 $ 141.6 $ ( 37.9 ) $ ( 0.5 ) $ 523.6 $ — $ 631.4

ASTEC INDUSTRIES, INC.

Consolidated Statements of Equity (Continued)

(In millions except share and per share data, unaudited)

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

Balance, December 31, 2023 22,740,635 $ 4.5 $ 138.4 $ ( 38.1 ) $ ( 0.8 ) $ 549.4 $ 0.3 $ 653.7

Net income — — — — — 12.1 — 12.1

Other comprehensive income — — — — — — 0.1 0.1

Net income (loss) — — — — — 3.4 ( 0.1 ) 3.3

Other comprehensive loss — — — ( 4.4 ) — — — ( 4.4 )

Dividends ($ 0.13 per share)

4 unchanged sentences

Balance, March 31, 2024 22,764,963 $ 4.5 $ 139.3 $ ( 42.5 ) $ ( 0.8 ) $ 549.8 $ 0.2 $ 650.5

Net income — — — — — 13.1 0.1 13.2

Other comprehensive income — — — 0.5 — — — 0.5

Dividends ($ 0.13 per share)

— — — — — ( 3.0 ) — ( 3.0 )

Share-based compensation — — 1.4 — — — — 1.4

Issuance of common stock under incentive plan 46,003 — — — — — — —

Withholding tax paid upon equity award vesting — — ( 0.2 ) — — — — ( 0.2 )

Balance, June 30, 2023 22,736,570 $ 4.5 $ 136.4 $ ( 39.6 ) $ ( 1.1 ) $ 547.1 $ 0.2 $ 647.5

Net (loss) income — — — — — ( 6.6 ) 0.1 ( 6.5 )

Other comprehensive loss — — — ( 4.6 ) — — — ( 4.6 )

Dividends ($ 0.13 per share)

— — — — — ( 3.0 ) — ( 3.0 )

Share-based compensation — — 1.3 — — — — 1.3

Issuance of common stock under incentive plan 2,726 — — — — — — —

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

Balance, September 30, 2023 22,739,296 $ 4.5 $ 137.7 $ ( 44.2 ) $ ( 1.0 ) $ 537.5 $ 0.3 $ 634.8

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

13 unchanged sentences

blower trucks;

concrete plants;

commercial and industrial burners;

and combustion control systems.

The Company operates in two reportable segments (plus Corporate and Other) - Infrastructure Solutions and Materials Solutions.

The Company's two reportable business segments comprise sites based upon the nature of the products or services produced, 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 and Astec Insurance Company ("Astec Insurance" or the "captive"), a captive insurance company, which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the reporting segments.

The Company operates in two reportable segments - Infrastructure Solutions and Materials Solutions.

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 and Astec Insurance Company ("Astec Insurance" or the "captive"), a captive insurance company, which do not meet the requirements as an operating segment or inclusion in one of the other reporting segments.

Basis of Presentation

1 unchanged sentence

Securities and Exchange Commission ("SEC").

The Company prepares its financial statements in accordance with accounting principles generally accepted in the U.S.

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

Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with U.S.

4 unchanged sentences

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 (income) loss 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 loss attributable to noncontrolling interest" in the Consolidated Statements of Operations.

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

2 unchanged sentences

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 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.

Significant items subject to such estimates and assumptions include excess and obsolete inventory, inventory net realizable value, product warranty obligations, capitalized implementation costs, 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.

1 unchanged sentence

Actual results could differ from those estimates.

In the opinion of management, the consolidated financial statements contain all adjustments necessary for a fair statement of the results of operations and comprehensive (loss) income for the three and nine months ended September 30, 2024 and 2023, the financial position as of September 30, 2024 and December 31, 2023 and the cash flows for the nine months ended September 30, 2024 and 2023, and, except as otherwise discussed herein, such adjustments consist only of those of a normal recurring nature.

In the opinion of management, the consolidated financial statements contain all adjustments necessary for a fair statement of the results of operations and comprehensive income (loss) for the three months ended March 31, 2025 and 2024, the financial position as of March 31, 2025 and December 31, 2024 and the cash flows for the three months ended March 31, 2025 and 2024, and, except as otherwise discussed herein, such adjustments consist only of those of a normal recurring nature.

The interim results are not necessarily indicative of results that may be achieved in a full reporting year.

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

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.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, "Segment Reporting (Topic 280):

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

Recently Adopted Accounting Pronouncements

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.

1 unchanged sentence

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 finalizing the assessment of the impact this ASU will have on its financial statement disclosures, but this standard will not impact the Company's results of operations or financial position.

The Company adopted this guidance beginning with the form 10-K filing for the year ended December 31, 2024.

See Note 9, Operations by Industry Segment and Geographic Area for additional information on the Company's reportable segments.

Recently Issued Accounting Pronouncements Not Yet Adopted

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

3 unchanged sentences

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, but this standard will not impact the Company's results of operations or financial position.

In March 2024, the SEC adopted the final rule under SEC Release No.

33-11275, "The Enhancement and Standardization of Climate-Related Disclosures for Investors," which will require registrants to disclose certain climate-related information in registration statements and annual reports.

On April 4, 2024, the SEC voluntarily stayed the effective date of the final rule pending judicial review of petitions challenging it, which have been consolidated for review by the U.S.

District Court of Appeals for the 8th Circuit.

Notwithstanding any changes as a result of these challenges, the disclosure requirements will apply to the Company's fiscal year beginning January 1, 2025.

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

However, the disclosure requirements of this rule and the timing of its effectiveness is uncertain pending the resolution of the judicial review.

The Company is currently evaluating the impact this ASU will have on its financial statement disclosures, but this standard will not impact the Company's results of operations, financial position or cash flows.

In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses", which requires entities to disclose specific types of expenses included in the expense captions presented on the face of the income statement, among other disclosures.

The new guidance is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027 on a prospective basis, with retrospective application permitted.

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

1 unchanged sentence

Inventories consist of the following:

(in millions) September 30, 2024 December 31, 2023

(in millions) March 31, 2025 December 31, 2024

Raw materials and parts $ 275.1 $ 275.4

5 unchanged sentences

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 (each, a "DCP") include a non-qualified Supplemental Executive Retirement Plan ("SERP") and a separate non-qualified Deferred Compensation Plan.

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

2 unchanged sentences

Investments are carried at their fair value based on quoted market prices for identical or similar assets or, where no quoted prices exist, other observable inputs for the asset.

The fair values of foreign currency exchange contracts are based on quotations from various banks for similar instruments using models with market-based inputs.

Financial assets and liabilities are categorized based on the level of judgment associated with the inputs used to measure their fair value.

5 unchanged sentences

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 September 30, 2024 and December 31, 2023 are Level 1 and Level 2 in the fair value hierarchy defined above:

September 30, 2024

As indicated in the tables below, the Company has determined that all of its financial assets and liabilities as of March 31, 2025 and December 31, 2024 are Level 1 and Level 2 in the fair value hierarchy defined above:

March 31, 2025

(in millions) Level 1 Level 2 Total

33 unchanged sentences

Financial liabilities:

Derivative financial instruments $ — $ 0.1 $ 0.1

Deferred compensation programs' liabilities — 6.1 6.1

Total financial liabilities $ — $ 6.1 $ 6.1

During the second quarter of 2024, the Company identified that indicators of goodwill impairment were present due to current macroeconomic conditions, including declines in the Company's publicly quoted share price and increased interest rates, as well as lower than expected operating results.

These factors indicated that one or more of the Company's reporting units may have fallen below their carrying amounts.

A qualitative assessment on all reporting units was performed and the Company concluded that a further quantitative analysis was required for the Materials Solutions reporting unit.

The Company determined the fair value of the Materials Solutions 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.

The Company calculates the discount rate based on a market-participant, risk-adjusted weighted average cost of capital, which considers industry specific rates of return on debt and equity capital for a target industry capital structure, adjusted for risks associated with business size, geography and other factors specific to the reporting unit.

A change in the discount rate, as a result of a change in economic conditions or otherwise, could result in the carrying value of the reporting unit exceeding its fair value.

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 quantitative impairment test, the Company determined that the carrying value of the Materials Solutions reporting unit exceeded its fair value as of June 30, 2024.

As a result, the Company recognized a pretax non-cash goodwill impairment charge of $ 20.2 million in "Goodwill impairment" in the Consolidated Statements of Operations to fully impair the goodwill allocated to the Materials Solutions reporting unit.

Product Warranty Reserves

1 unchanged sentence

The warranty period and performance standards vary by market and uses of its products, but generally range from three months to two years or up to a specified number of hours of operation.

The Company estimates the costs that may be incurred under its warranties and

records a liability at the time product sales are recorded.

The product warranty liability is primarily based on historical claim rates, nature of claims and the associated cost.

Changes in the Company's product warranty liability for the three and nine month periods ended September 30, 2024 and 2023 are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

The Company estimates the costs that may be incurred under its warranties and records a liability at the time product sales are recorded.

The product warranty liability is primarily based on historical claim rates, nature of claims and the associated costs.

Changes in the Company's product warranty liability for the three month periods ended March 31, 2025 and 2024 are as follows:

Three Months Ended March 31,

(in millions) 2025 2024

2 unchanged sentences

Warranty liabilities settled ( 4.6 ) ( 4.5 )

Other 0.1 — — —

Reserve balance, end of the period $ 17.8 $ 16.2

Accrued Loss Reserves

The Company records 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 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 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 $ 6.9 million and $ 7.2 million as of September 30, 2024 and December 31, 2023, respectively, of which $ 5.1 million and $ 4.5 million were included in "Other long-term liabilities" in the Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively.

For the three months ended September 30, 2024, the Company recorded an income tax benefit of $ 2.3 million, reflecting a 27.1 % effective tax rate, compared to $ 0.6 million for the three months ended September 30, 2023, reflecting an 8.5 % effective tax rate.

The income tax benefit for the three months ended September 30, 2024 was higher compared to the same period in 2023 primarily due to higher pretax book loss and changes in the relative weighting of jurisdictional income and loss.

For the nine months ended September 30, 2024, the Company recorded an income tax benefit of $ 0.6 million, reflecting a 3.4 % effective tax rate, compared to a provision of $ 6.5 million for the nine months ended September 30, 2023, reflecting a 25.7 % effective tax rate.

The income tax benefit for the nine months ended September 30, 2024 as compared to an expense in the same period in 2023 was primarily due to lower pretax book income and changes in the relative weighting of jurisdictional income and loss, partially offset by a net nondeductible goodwill impairment.

The Company's recorded liability for uncertain tax positions was $ 13.7 million and $ 13.0 million as of September 30, 2024 and December 31, 2023, respectively.

Total accrued loss reserves were $ 6.3 million as of both March 31, 2025 and December 31, 2024, of which $ 5.0 million and $ 4.6 million were included in "Other long-term liabilities" in the Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024, respectively.

For the three months ended March 31, 2025, the Company recorded an income tax expense of $ 5.4 million, reflecting a 27.4 % effective tax rate, compared to a $ 1.4 million income tax expense for the three months ended March 31, 2024, reflecting a 29.8 % effective tax rate.

The income tax expense for three months ended March 31, 2025 was higher compared to the same period in 2024, primarily due to higher pretax book income and changes in the relative weighting of jurisdictional income and loss.

The Company's recorded liability for uncertain tax positions was $ 17.0 million and $ 16.8 million as of March 31, 2025 and December 31, 2024, respectively.

The increase is the result of $ 0.2 million of incremental reserves associated with a research and development credit generated during 2025.

3 unchanged sentences

Internal Revenue Service for the federal income tax return from the 2018 tax year as well as various other state income tax and jurisdictional audits.

As of September 30, 2024, the Company believes that it is more likely than not that the tax positions it has taken will be sustained upon the resolution of its audits, resulting in no material impact on its consolidated financial position, results of operations and cash flows.

As of March 31, 2025, the Company believes that it is more likely than not that the tax positions it has taken will be sustained upon the resolution of its audits, resulting in no material impact on its consolidated financial position, results of operations and cash flows.

However, the final determination with respect to any tax audits, and any related litigation, could be materially different from the Company's estimates and/or from its historical income tax provisions and accruals and could have a material effect on operating results and/or cash flows in the periods for which that determination is made.

1 unchanged sentence

Commitments and Contingencies

Certain customers have financed purchases of Company products through arrangements with third-party financing institutions.

Under these arrangements, the Company is contingently liable for customer debt of $ 1.5 million and $ 1.1 million as of September 30, 2024 and December 31, 2023, 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 2024), 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 financed

equipment if the Company is required to fulfill its contingent liability under these arrangements.

The Company has recorded a liability of $ 0.4 million and $ 0.6 million related to these guarantees, which were included in "Other current liabilities" in the Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively.

The Company reviews off-balance sheet guarantees individually and at the loss pool level based on one agreement.

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 $ 1.6 million and $ 1.4 million as of March 31, 2025 and December 31, 2024, respectively.

These arrangements expire at various dates through March 2030.

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

The Company has recorded a liability of $ 0.3 million related to these guarantees as of both March 31, 2025 and December 31, 2024, which were included in "Other current liabilities" in the Consolidated Balance Sheets.

The Company reviews off-balance sheet guarantees individually.

Prior history is considered with respect to the Company having to perform on any off-balance sheet guarantees, as well as future projections of individual customer creditworthiness with respect to assessing credit losses related to off-balance sheet guarantees.

In addition, the Company is contingently liable under letters of credit issued under its $ 250.0 million revolving credit facility (the "Credit Facility"), which outstanding letters of credit totaled $ 8.6 million as of September 30, 2024.

The outstanding letters of credit expire at various dates through September 2025.

Unused letters of credit under the Credit Facility are $ 21.4 million as of September 30, 2024.

The Company is additionally contingently liable for a total of $ 5.8 million in performance letters of credit and retention guarantees primarily held by its foreign subsidiaries, of which $ 4.0 million are secured by separate credit facilities with various financial institutions as of September 30, 2024.

As of September 30, 2024, there were $ 12.9 million of unused letters of credit under such separate credit facilities.

The Company and certain of its former executive officers were previously named as defendants in a putative shareholder class action lawsuit filed in 2019 alleging that the defendants violated the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Rule 10b-5 promulgated thereunder by making allegedly false and misleading statements.

On September 10, 2024, the court formally approved the parties' agreement to settle the action for $ 13.7 million, which was funded entirely by the Company's insurance carriers into escrow , and the settlement agreement was entered into between the parties.

The court dismissed the case with prejudice the same day.

In connection with the settlement, management previously recorde d a liability of $ 13.7 million in " Other current liabilities" and a corresponding $ 13.7 million receivable from the Company's insurance carriers in "Trade receivables, contract assets and other receivables, net" during the first quarter of 2024.

The Company's GEFCO, Inc.

("GEFCO" or "Enid") subsidiary has been named a defendant in a lawsuit originally filed in 2018.

The complaint alleged breaches of warranty and other similar claims regarding equipment sold by GEFCO in 2013 and also sought special and consequential damages.

On October 8, 2024, the parties reached an agreement to resolve this action for $ 8.4 million for which management recorded a loss in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations and "Other current liabilities" in the Consolidated Balance Sheets during the third quarter of 2024.

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.

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") against Telsmith.

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 in January 2024.

The court denied Telsmith's motion for a new trial in February 2024.

In March 2024, Telsmith filed a notice of appeal with the Texas Court of Appeals to appeal the Judgment by the district court.

As of June 30, 2024, the total loss contingency recorded inclusive of post-judgment interest was $ 8.2 million.

In September 2024, the parties reached an agreement to resolve this action for $ 6.3 million, which the Company paid in September 2024 whereby the full loss contingency was released.

The $ 1.9 million net impact of the loss contingency release and the final settlement amount was recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations during the third quarter of 2024.

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.

In addition, the Company is contingently liable for letters of credit issued under its $ 250.0 million revolving credit facility (the "Credit Facility"), which outstanding letters of credit totaled $ 5.2 million as of March 31, 2025.

The outstanding letters of credit expire at various dates through April 2026.

Unused letters of credit under the Credit Facility were $ 24.8 million as of March 31, 2025.

The Company is additionally contingently liable for a total of $ 5.0 million in performance letters of credit and retention guarantees primarily held by its foreign subsidiaries, of which $ 3.4 million are secured by separate credit facilities with various financial institutions as of March 31, 2025.

Unused letters of credit under these separate credit facilities were $ 12.9 million as of March 31, 2025.

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.

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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.

However, claims and legal proceedings are subject to inherent

uncertainties, and rulings unfavorable to the Company could occur.

However, claims and legal proceedings are subject to inherent uncertainties, and rulings unfavorable to the Company could occur.

If an unfavorable ruling were to occur, there exists the possibility of a material adverse effect on the Company's financial position, cash flows or results of operations.

Previously Settled Matters

The Company and certain of its former executive officers were previously named as defendants in a putative shareholder class action lawsuit filed in 2019.

In September 2024, the court formally approved the parties' agreement to settle the action for $ 13.7 million, which was funded entirely by the Company's insurance carriers, and the settlement agreement was entered into between the parties.

In September 2024, the Company reached an agreement to resolve the matter styled 37 Building Products, Ltd.

Telsmith, Inc., et al.

for $ 6.3 million, which the Company paid that same month.

Upon settlement, the full loss contingency of $ 8.2 million, inclusive of post-judgment interest, that was recorded as of June 30, 2024 was released.

The $ 1.9 million net benefit derived from the loss contingency release offset by the final settlement amount was recorded in "Selling, general and administrative

expenses" in the Consolidated Statements of Operations during the third quarter of 2024.

In October 2024, the Company reached an agreement to resolve the action styled VenVer S.A.

and Americas Coil Tubing LLP v.

for $ 8.4 million, which was paid in the fourth quarter of 2024.

In connection with this settlement, management recorded a loss in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations during the third quarter of 2024.

Revenue Recognition

The following tables disaggregate the Company's revenue by major source for the three and nine-month periods ended September 30, 2024 and 2023 (excluding intercompany sales):

Three Months Ended September 30, 2024 Three Months Ended September 30, 2023

The following tables disaggregate the Company's revenue by major source for the three-month periods ended March 31, 2025 and 2024 (excluding intercompany sales):

Three Months Ended March 31, 2025 Three Months Ended March 31, 2024

(in millions) Infrastructure Solutions Materials Solutions Total Infrastructure Solutions Materials Solutions Total

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Service and equipment installation revenue 9.1 0.2 9.3 8.2 0.1 8.3

Used equipment sales 2.1 0.2 2.3 — — —

Freight revenue 7.5 1.2 8.7 5.7 1.9 7.6

5 unchanged sentences

Service and equipment installation revenue 0.3 2.7 3.0 0.2 2.6 2.8

Used equipment sales — — — — 0.4 0.4

Freight revenue 0.3 0.6 0.9 0.2 0.5 0.7

2 unchanged sentences

Total net sales $ 236.0 $ 93.4 $ 329.4 $ 202.2 $ 107.0 $ 309.2

Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023

As of March 31, 2025, the Company had contract assets of $ 5.8 million and contract liabilities, excluding customer deposits, of $ 6.5 million, including $ 1.1 million of deferred revenue related to extended warranties.

As of December 31, 2024, the Company had contract assets of $ 6.6 million and contract liabilities, excluding customer deposits, of $ 5.8 million, including $ 1.3 million of deferred revenue related to extended warranties.

Operations by Industry Segment and Geographic Area

The Company has two operating and reportable segments, each of which comprise sites based upon the nature of the products or services produced, 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 accounting policies of the reportable segments are the same as those described in Note 1, Basis of Presentation and Significant Accounting Policies.

Intersegment sales and transfers between foreign subsidiaries are valued at prices comparable to those for unrelated parties.

Segment Operating Adjusted EBITDA is the measure of segment profit or loss used by the Company's Chief Executive Officer ("CEO"), who is the CODM, to evaluate performance and allocate resources to the reportable segments.

The CODM uses this measure to allocate resources, including headcount, financial resources and capital resources, for each segment, predominantly in the annual budgeting process.

Additionally, Segment Operating Adjusted EBITDA is believed to strongly correlate with shareholder returns and is, therefore, included as a key component in the compensation of certain employees.

This metric is used to monitor actual results versus budget and forecast on a monthly basis to assess segment performance as compared to expectations.

Segment Operating Adjusted EBITDA 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.

A brief description of each segment is as follows:

Infrastructure Solutions - Sites within the Infrastructure Solutions segment design, engineer, manufacture and market a complete line of asphalt plants, concrete plants and their related components and ancillary equipment, including industrial automation controls and telematics platforms, as well as supply asphalt road construction equipment, industrial thermal systems, land clearing, recycling and other heavy equipment.

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

The primary purchasers of the products produced by this segment are asphalt and concrete producers, highway and heavy equipment contractors, commercial and residential paving contractors, utility contractors, forestry and environmental recycling contractors and domestic and foreign governmental agencies.

Materials Solutions - Sites within the Materials Solutions segment design and manufacture heavy rock processing equipment, in addition to servicing and supplying parts for the aggregate, mining, recycling, ports and bulk handling markets.

The sites within the Materials Solutions segment are primarily manufacturing operations, with sites in Australia, Chile and Thailand functioning to market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of the Company's manufacturing sites.

Additionally, the Materials Solutions segment offers consulting and engineering services to provide complete "turnkey" processing systems.

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

Asset information for the Company's reportable segments is set forth below:

March 31, 2025 December 31, 2024

(in millions) Infrastructure Solutions Materials Solutions Total Infrastructure Solutions Materials Solutions Total

Net Sales-Domestic:

Equipment sales $ 352.5 $ 114.6 $ 467.1 $ 316.8 $ 197.8 $ 514.6

Parts and component sales 160.9 61.1 222.0 160.1 64.1 224.2

Service and equipment installation revenue 18.1 0.5 18.6 38.1 0.6 38.7

Used equipment sales 0.1 — 0.1 2.6 — 2.6

Freight revenue 16.3 5.1 21.4 17.4 6.4 23.8

Other 1.8 ( 4.5 ) ( 2.7 ) 0.9 ( 7.5 ) ( 6.6 )

Total domestic revenue 549.7 176.8 726.5 535.9 261.4 797.3

Net Sales-International:

Equipment sales 22.1 119.9 142.0 25.6 103.5 129.1

Parts and component sales 15.5 51.2 66.7 14.7 46.8 61.5

Service and equipment installation revenue 0.6 8.1 8.7 0.9 6.9 7.8

Used equipment sales — — — — 1.8 1.8

Freight revenue 0.7 1.9 2.6 0.8 2.5 3.3

Reportable segment assets $ 1,114.1 $ 785.8 $ 1,899.9 $ 1,095.8 772.3 $ 1,868.1

Revenue, significant expense and capital expenditure information for the Company's reportable segments is set forth below:

Three Months Ended March 31, 2025 Three Months Ended March 31, 2024

(in millions) Infrastructure Solutions Materials Solutions Total Infrastructure Solutions Materials Solutions Total

Reportable segment revenues:

Revenues from external customers $ 236.0 $ 93.4 $ 329.4 $ 202.2 $ 107.0 $ 309.2

Intersegment revenues 8.8 2.1 10.9 6.8 0.5 7.3

Total revenues - reportable segments $ 244.8 $ 95.5 $ 340.3 $ 209.0 $ 107.5 $ 316.5

Significant reportable segment expenses:

Manufacturing operation costs:

Equipment $ 97.6 $ 40.9 $ 138.5 $ 79.8 $ 49.4 $ 129.2

Parts 36.3 19.1 55.4 40.7 19.5 60.2

Other 24.5 10.6 35.1 25.5 10.2 35.7

Total international revenue 38.9 180.7 219.6 42.2 161.5 203.7

Total net sales $ 588.6 $ 357.5 $ 946.1 $ 578.1 $ 422.9 $ 1,001.0

Sales into major geographic regions were as follows:

Three Months Ended September 30, Nine Months Ended September 30,

General and administrative 14.9 7.8 22.7 14.1 8.5 22.6

Sales and marketing 11.4 6.3 17.7 12.8 6.9 19.7

Quality costs (1)

6.6 2.5 9.1 3.8 2.8 6.6

Research and development 4.4 1.9 6.3 4.4 2.1 6.5

Inventory period costs (2)

6.3 1.6 7.9 2.3 3.4 5.7

Other segment items (3)

( 0.1 ) ( 0.4 ) ( 0.5 ) — ( 0.6 ) ( 0.6 )

Reportable Segment Operating Adjusted EBITDA $ 42.9 $ 5.2 $ 48.1 $ 25.6 $ 5.3 $ 30.9

Reportable segment capital expenditures $ 2.9 $ 0.7 $ 3.6 $ 4.4 $ 1.3 $ 5.7

(1) Quality costs related to repair or other remediation expenses incurred for corrective action on product failures covered by warranties or voluntarily for certain warranty-type expenses occurring after the normal warranty period expires to help protect the reputation of the Company's products and maintain the goodwill of customers.

(2) Inventory period costs primarily relate to inventory reserves and adjustments and net scrap sales.

(3) Other segment items consists of foreign exchange gains and losses, investment income and loss and other income and expense amounts that are included in Segment Operating Adjusted EBITDA that are not considered to be significant segment expenses.

The reconciliation of Reportable Segment Operating Adjusted EBITDA to total "Income before income taxes" is set forth below:

Three Months Ended March 31,

(in millions) 2025 2024

Segment Operating Adjusted EBITDA - reportable segments $ 48.1 $ 30.9

Corporate and Other expenses ( 12.9 ) ( 12.0 )

Transformation program ( 6.9 ) ( 6.3 )

Restructuring and other related charges — ( 0.1 )

Gain on sale of property and equipment, net — 0.9

Transaction costs ( 0.8 ) —

Interest expense, net ( 1.4 ) ( 2.1 )

Depreciation and amortization ( 6.4 ) ( 6.5 )

Net income attributable to noncontrolling interest — ( 0.1 )

Income before income taxes $ 19.7 $ 4.7

"Net sales" into major geographic regions, attributable to the shipping location or the location where service was performed, were as follows:

Three Months Ended March 31,

(in millions) 2025 2024

United States $ 273.8 $ 243.2

Canada 15.4 18.9

Australia 25.0 20.6 44.3 44.4

Africa 8.2 9.0

Europe 7.4 9.0

Mexico 11.2 3.4 22.1 6.2

Brazil 5.7 5.6

Australia 4.7 9.3

Mexico 3.2 4.3

South America (Excluding Brazil) 3.2 5.0

Asia 2.7 2.8 10.3 6.5

Central America (Excluding Mexico) 0.4 0.7

2 unchanged sentences

Total net sales $ 329.4 $ 309.2

As of September 30, 2024, the Company had contract assets of $ 6.6 million and contract liabilities, excluding customer deposits, of $ 8.1 million, including $ 1.3 million of deferred revenue related to extended warranties.

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

Segment Information

The Company has two reportable segments, each of which comprise sites based upon the nature of the products or services produced, 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 Australia and Latin America ("LatAm") sites and Astec Digital have changed reportable segments beginning January 1, 2024.

The Australia and LatAm sites were previously reported in the Infrastructure Solutions segment and have moved to the Materials Solutions segment.

Astec Digital was previously included in the Corporate and Other category and has moved to the Infrastructure Solutions segment.

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

Segment Operating Adjusted EBITDA 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.

Beginning January 1, 2024, the Company's presentation of Segment Operating Adjusted EBITDA has been modified to exclude the net income or loss attributable to the noncontrolling interest and include intersegment profit.

Prior periods have been revised to reflect the changes for both the segment composition and the segment profit or loss metric calculation for comparability.

A brief description of each segment is as follows:

Infrastructure Solutions – Sites within the Infrastructure Solutions segment design, engineer, manufacture and market a complete line of asphalt plants, concrete plants and their related components and ancillary equipment, including industrial automation controls and telematics platforms, as well as supply asphalt road construction equipment, industrial thermal systems and other heavy equipment.

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

The primary purchasers of the products produced by this segment are asphalt and concrete producers, highway and heavy equipment contractors, utility contractors, forestry and environmental recycling contractors and domestic and foreign governmental agencies.

Materials Solutions – Sites within the Materials Solutions segment design and manufacture heavy processing equipment, in addition to servicing and supplying parts for the aggregate, metallic mining, recycling, ports and bulk handling markets.

The sites within the Materials Solutions segment are primarily manufacturing operations, with the AME, Australia and LatAm sites functioning to market, service and install equipment and provide parts in the regions in which they operate for many of the products produced by all of the Company's manufacturing sites.

Additionally, the Materials Solutions segment offers consulting and engineering services to provide complete "turnkey" processing systems.

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 and the captive which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the reporting segments.

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

Segment Information:

The accounting policies of the reportable segments are the same as those described in Note 1, Basis of Presentation and Significant Accounting Policies.

Intersegment sales and transfers between foreign subsidiaries are valued at prices comparable to those for unrelated parties.

The Company has revised its presentation for the prior periods below to remove the presentation of Corporate and Other in conjunction with the reportable segment results and reconcile the total of the reportable segments’ revenues from external customers and measure of profit or loss to "Net sales" and "(Loss) income before income taxes", respectively, whereby Corporate and Other costs, net of eliminations, have been removed from total reportable segments’ revenues from external customers and Segment Operating Adjusted EBITDA and included in the reconciliations to "Net sales" and "(Loss) income before income taxes", respectively.

Segment information for the Company’s reportable segments and related reconciliations are set forth below:

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2024 2023 2024 2023

Revenues from external customers

Infrastructure Solutions $ 165.0 $ 163.2 $ 588.6 $ 578.1

Materials Solutions 126.4 139.9 357.5 422.9

Net sales $ 291.4 $ 303.1 $ 946.1 $ 1,001.0

Intersegment revenues

Infrastructure Solutions $ 25.7 $ 11.9 $ 41.4 $ 28.6

Materials Solutions 1.4 0.1 2.8 0.8

Intersegment revenues $ 27.1 $ 12.0 $ 44.2 $ 29.4

Reportable Segment Operating Adjusted EBITDA

Infrastructure Solutions $ 15.6 $ 13.3 $ 68.4 $ 67.5

Materials Solutions 14.5 9.5 30.0 42.4

Segment Operating Adjusted EBITDA - Reportable Segments 30.1 22.8 98.4 109.9

Reconciliation of Reportable Segment Operating Adjusted EBITDA to "(Loss) income before income taxes"

Corporate and Other ( 12.7 ) ( 12.8 ) ( 34.5 ) ( 32.5 )

Transformation program ( 8.4 ) ( 7.7 ) ( 25.8 ) ( 22.5 )

Restructuring and other related charges ( 8.4 ) ( 0.1 ) ( 9.4 ) ( 7.6 )

Goodwill impairment — — ( 20.2 ) —

Asset impairment — — — ( 0.8 )

(Loss) gain on sale of property and equipment, net — ( 0.4 ) 1.1 3.1

Interest expense, net ( 2.1 ) ( 1.9 ) ( 6.9 ) ( 4.9 )

Depreciation and amortization ( 7.0 ) ( 7.1 ) ( 20.1 ) ( 19.6 )

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

(Loss) income before income taxes $ ( 8.5 ) $ ( 7.1 ) $ ( 17.5 ) $ 25.3

Strategic Transformation, Restructuring, Impairment and Other Asset Charges, net

Strategic Transformation, Restructuring and Other Asset Gains, net

The Company's strategic transformation program includes the ongoing multi-year phased implementation of a standardized enterprise resource planning ("ERP"), which is replacing much of the existing disparate core financial systems.

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

In addition, a lean manufacturing initiative at one of the Company's largest sites was largely completed during 2023 with certain capital investments finalized in early 2024.

Capitalized implementation costs associated with the ERP implementation totaled $ 32.8 million, of which $ 3.7 million and $ 29.1 million were included in "Prepaid expenses and other assets" and "Other long-term assets," respectively, in the Consolidated Balance Sheets as of September 30, 2024.

Capitalized implementation costs 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.

Net capitalized implementation costs associated with the ERP implementation totaled $ 31.0 million, of which $ 3.7 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 March 31, 2025.

Net capitalized implementation costs totaled $ 31.9 million, of which $ 3.7 million and $ 28.2 million were included in "Prepaid expenses and other assets" and "Other long-term assets," respectively, in the Consolidated Balance Sheets as of December 31, 2024.

Accumulated amortization associated with these capitalized implementation costs totaled $ 6.4 million and $ 5.5 million as of March 31, 2025 and December 31, 2024, respectively.

Costs associated with these strategic transformation programs are presented below:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2025 2024

1 unchanged sentence

Selling, general and administrative expenses

$ 8.6 $ 7.7 $ 26.0 $ 22.6

Cost of sales

0.1 0.1 0.4 0.2

Total costs related to strategic transformation initiatives $ 7.0 $ 6.5

Amortization of capitalized implementation costs (a)

$ 1.0 $ 0.7 $ 2.7 $ 1.2

(a) Amortization of capitalized implementation costs is recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations.

Amortization of capitalized implementation costs (1)

(1) Amortization of capitalized implementation costs is recorded 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.

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

Restructuring, asset impairment charges and the loss (gain) on sale of property and equipment, net are presented below:

Three Months Ended September 30, Nine Months Ended September 30,

Certain of the costs associated with these decisions are separately identified as restructuring.

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

Restructuring, asset impairment charges and the gain on sale of property and equipment, net are presented below:

Three Months Ended March 31,

(in millions) 2025 2024

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Costs associated with exited operations – Enid $ — $ 0.1

Workforce reductions — — 0.9 —

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

Total restructuring related charges — 0.1

Asset impairment charges:

Other impairment charges — — — 0.8

Total asset impairment charges — — — 0.8

Loss (gain) on sale of property and equipment, net:

Loss (gain) on sale of property and equipment, net — 0.4 ( 1.1 ) ( 3.1 )

Total loss (gain) on sale of property and equipment, net — 0.4 ( 1.1 ) ( 3.1 )

Restructuring, other impairment and asset charges, net $ 8.4 $ 0.5 $ 8.3 $ 5.3

Restructuring charges by reportable segment and the Corporate and Other category are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Gain on sale of property and equipment, net:

Gain on sale of property and equipment, net — ( 0.9 )

Total gain on sale of property and equipment, net — ( 0.9 )

Restructuring and other asset gains, net $ — $ ( 0.8 )

Restructuring charges by reportable segment are as follows:

Three Months Ended March 31,

(in millions) 2025 2024

Infrastructure Solutions $ — $ 0.1

Materials Solutions — 0.1 0.3 0.2

Corporate and Other — — 0.2 6.4

Total restructuring related charges $ — $ 0.1

Asset impairment charges by reportable segment and the Corporate and Other category are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

(in millions) 2024 2023 2024 2023

Corporate and Other $ — $ — $ — $ 0.8

Total asset impairment charges $ — $ — $ — $ 0.8

Loss (gain) on sale of property and equipment, net by reportable segment and the Corporate and Other category are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

The net gains on sale of property and equipment by reportable segment are as follows:

Three Months Ended March 31,

(in millions) 2025 2024

1 unchanged sentence

Materials Solutions — ( 0.8 )

Corporate and Other — 0.1 — —

Total loss (gain) on sale of property and equipment, net $ — $ 0.4 $ ( 1.1 ) $ ( 3.1 )

Restructuring charges accrued, but not paid, were $ 8.5 million and $ 0.1 million as of September 30, 2024 and December 31, 2023, respectively.

On October 8, 2024, the Company reached an agreement to resolve the action styled VenVer S.A.

and Americas Coil Tubing LLP v.

GEFCO, Inc., related to the Company's former Enid, Oklahoma site, for $ 8.4 million.

In connection with the settlement, management recorded a loss within the Infrastructure Solutions segment of $ 8.4 million in "Restructuring, impairment and other asset charges, net" in the Consolidated Statements of Operations and "Other current liabilities" in the Consolidated Balance Sheets during the third quarter of 2024.

See Note 8, Commitments and Contingencies for further discussion of this matter.

In January 2021, the Company announced plans to close the Tacoma, Washington facility in order to simplify and consolidate operations within the Infrastructure Solutions segment.

The sale of the Tacoma facility's land, building and certain equipment 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, other impairment and asset charges, net" in the Consolidated Statements of Operations.

Effective as of January 6, 2023, Mr.

Ruffalo's employment as President and CEO was terminated.

In connection with his separation, the Company entered into an agreement with Mr.

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

Ruffalo was entitled to certain severance payments and benefits.

During the first quarter of 2023, $ 1.8 million of restructuring costs, related to the modification of Mr.

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

The related recovery of $ 1.6 million of 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 included a release and waiver by Mr.

Ruffalo and other customary provisions.

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, the Company effected workforce reductions during the second quarter of 2024, whereby charges of $ 0.9 million were incurred during the three months ended June 30, 2024 and recorded in "Restructuring, other impairment and asset charges, net" in the Consolidated Statements of Operations.

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

Total charges of $ 5.5 million for employee termination costs, including equity award modifications, were recorded in "Restructuring, other impairment and asset charges, net" in the Consolidated Statements of Operations of which $ 5.2 million and $ 0.3 million were recorded in the first and second quarters of 2023, respectively.

The related recovery of $ 1.0 million of incurred share-based compensation expense was recorded in "Selling, general and administrative expenses" in the Consolidated Statements of Operations of which $ 0.8 million and $ 0.2 million were recorded in the first and second quarters of 2023, respectively.

Asset impairment charges of $ 0.8 million were incurred related to abandoned in-process internally developed software that was determined to be impaired during the second quarter of 2023.

(Loss) Earnings Per Common Share

Basic (loss) earnings per common share is determined by dividing "Net (loss) income attributable to controlling interest" by the weighted average number of common shares outstanding during the reporting period.

Diluted (loss) earnings per common share includes the dilutive effect of common stock equivalents, consisting of restricted stock units, performance stock units and stock

held in the Company's deferred compensation programs, using the treasury stock method.

Potential common shares that have an antidilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted earnings per share.

Total gain on sale of property and equipment, net $ — $ ( 0.9 )

Earnings Per Common Share

Basic earnings per common share is determined by dividing "Net income attributable to controlling interest" by the weighted average number of common shares outstanding during the reporting period.

Diluted earnings per common share includes the dilutive effect of common stock equivalents, consisting of restricted stock units, performance stock units and stock held in the Company's deferred compensation programs, using the treasury stock method.

Potential common shares that have an

antidilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted earnings per share.

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

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

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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

Three Months Ended March 31,

Denominator for basic earnings per common share 22,833,292 22,762,098

2 unchanged sentences

Antidilutive securities excluded from the calculation of diluted earnings per share 424 14,130

Subsequent Events

Agreement to Acquire TerraSource

On April 28, 2025, the Company entered into a Membership Interest Purchase Agreement (the "Purchase Agreement") with RLI TSG Holdings LLC, K-Tron Investment Co.

and other sellers party thereto (collectively, the "Sellers"), pursuant to which, subject to the satisfaction of customary conditions, the Company will acquire 100 % of the equity interests of TerraSource Holdings, LLC, a market-leading manufacturer of material processing equipment and related aftermarket parts serving complementary crushing, screening and separation applications and headquartered in Missouri (such acquisition, the "Transaction").

The total cash consideration payable to the Sellers is $ 245.0 million, subject to a customary purchase price adjustment.

The acquisition is expected to be accounted for as a business combination.

In connection with the Transaction, on April 28, 2025, the Company entered into a debt commitment letter (the "Commitment Letter") with Wells Fargo Bank, National Association, and the other lender parties thereto (collectively, the "Lenders"), pursuant to which, and subject to the terms and conditions set forth therein, the Lenders committed to provide provide a $ 500.0 million senior secured credit facility (which may be increased by up to $ 50.0 million), consisting of (i) a revolving credit facility in an aggregate principal amount of $ 150.0 million and (ii) a term loan facility in an aggregate principal amount of $ 350.0 million (the "Senior Credit Facility").

The Company intends to use the proceeds of the term loan facility, together with cash on hand, to fund the Transaction, to refinance the Company’s existing credit facilities and to pay for fees, costs and expenses incurred in connection with the foregoing.

The funding of the Senior Credit Facility provided for in the Commitment Letter is contingent on the satisfaction of customary closing conditions.

The Transaction, which is subject to the satisfaction of regulatory clearance and other customary closing conditions, is targeted to close in the third quarter of 2025.

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-Q

Item 1. Financial Statements