What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-07 compared with 2024-03-06 · 362 added, 352 removed, 878 unchanged (45% of the section changed)

5 unchanged sentences

We have audited the accompanying consolidated balance sheets of L.B.

Foster Company and subsidiaries (the Company) as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2023, and the related notes and financial statement schedule listed in the Index at Item 15 (a) (collectively referred to as the “consolidated financial statements”).

Foster Company and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income, stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15 (a)(2) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with U.S.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 6, 2024 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 7, 2025 expressed an adverse opinion thereon.

Basis for Opinion

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

Critical Audit Matters

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

(1) relate 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 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.

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 the critical audit matter 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 matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue recognition – contract estimates

1 unchanged sentence

The Company’s performance obligations under long-term agreements with its customers are generally satisfied over time.

Revenue under these long-term agreements is generally recognized over time either using an input measure based upon the proportion of actual costs incurred to estimated total project costs or an input measure based upon actual labor costs as a percentage of estimated total labor costs, depending upon which measure the Company believes best depicts the Company’s performance to date under the terms of the contract.

Revenue under these long-term agreements is generally recognized over time using an input measure based upon the proportion of actual costs incurred to estimated total project costs, which the Company believes best depicts the Company’s performance to date under the terms of the contract.

For the year ended December 31, 2024, the Company recorded $52.7 million of over time input method revenue within net sales on its consolidated statement of operations.

1 unchanged sentence

Contract estimates are based on various assumptions to project the outcome of future events that may span several years.

These assumptions include, among other things, labor costs, sub-contractor costs, material costs, and total collections from the customer.

These assumptions include, among other things, sub-contractor costs, material costs, and total collections from the customer.

Significant changes in the above estimates could impact the timing and amount of revenue and profitability of the Company’s long-term contracts.

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We also performed a retrospective review of management’s estimates for a sample of completed contracts by comparing initial estimates with the actual historical data to assess management’s ability to estimate.

Valuation of goodwill for the Rail Technologies and Precast Concrete Products Reporting Units

Description of the Matter At December 31, 2023, the Company had $32.6 million of goodwill on its consolidated balance sheet.

As more fully described in Notes 1 and 5 to the consolidated financial statements, goodwill is tested for impairment annually as of October 1st, or more frequently, if an event occurs or circumstances change that would more likely than not reduce fair value below carrying value.

The Company performed a quantitative assessment on the goodwill at both the Rail Technologies and Precast Concrete Reporting units.

Significant assumptions used in the Company’s fair value estimate included revenue growth and EBITDA contribution.

Auditing the goodwill test was complex, as it included estimating the fair value of the reporting units.

In particular, the fair value estimates are subjective and sensitive to the significant assumptions.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of internal controls over the Company’s goodwill impairment review process, including controls over management’s review of the valuation model and the significant assumptions underlying the fair value determination, as described above.

To test the fair value of the reporting unit, our audit procedures included, among others, involving our valuation specialists to assist in assessing the valuation methodologies utilized by the Company and its valuation expert and testing the significant assumptions and underlying data used by the Company.

We compared the significant assumptions used by management to historical performance and other relevant factors.

We performed sensitivity analyses of significant assumptions to evaluate the changes in fair values that would result from changes in the assumptions.

We reviewed the reconciliation of the fair value of the reporting units to the market capitalization of the Company and assessed the resulting control premium.

/s/ Ernst & Young LLP

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March 7, 2025

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FOSTER COMPANY AND SUBSIDIARIES

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Other intangibles - net (Note 4) 14,801 19,010

Deferred tax assets (Note 13) 28,900 —

Other assets 3,483 2,965

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Deferred tax liabilities (Note 13) 1,150 1,232

Long-term portion of accrued settlement (Note 18) — 8,000

Long-term operating lease liabilities (Note 8) 14,709 11,865

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The accompanying notes are an integral part of these Consolidated Financial Statements.

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FOSTER COMPANY AND SUBSIDIARIES

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Selling and administrative expenses 96,398 97,623

(Gain) on sale of former joint venture facility ( 3,477 ) —

Amortization expense (Note 4) 4,628 5,314

Goodwill and long-lived assets impairment charges (Note 5) — 8,016

Operating income (loss) 10,138 ( 7,206 )

Operating income 20,513 9,107

Interest expense - net 4,992 5,528

Other expense (income) - net (Note 19) 3,666 ( 1,550 )

Income (loss) before income taxes 944 ( 8,996 )

Income tax (benefit) expense (Note 14) ( 355 ) 36,681

Net income (loss) 1,299 ( 45,677 )

Other expense - net (Note 18) 1,076 2,635

Income before income taxes 14,445 944

Income tax benefit (Note 13) ( 28,398 ) ( 355 )

Net income 42,843 1,299

Net loss attributable to noncontrolling interest ( 103 ) ( 165 )

Net income (loss) attributable to L.B.

Net income attributable to L.B.

Foster Company $ 42,946 $ 1,464

Basic earnings (loss) per common share (Note 13) $ 0.14 $ ( 4.25 )

Diluted earnings (loss) per common share (Note 13) $ 0.13 $ ( 4.25 )

Basic earnings per common share (Note 12) $ 4.01 $ 0.14

Diluted earnings per common share (Note 12) $ 3.89 $ 0.13

Basic weighted average shares outstanding 10,721 10,799

1 unchanged sentence

The accompanying notes are an integral part of these Consolidated Financial Statements.

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FOSTER COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

Year Ended December 31,

Net income (loss) $ 1,299 $ ( 45,677 )

Net income $ 42,843 $ 1,299

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustment ( 2,887 ) 2,428

Unrealized (loss) gain on cash flow hedges, net of tax expense of $ 0

Unrealized loss on cash flow hedges, net of tax benefit of $ 203 and $ 0 , respectively

( 593 ) ( 704 )

Cash flow hedges reclassified to earnings, net of tax expense of $ 0

Pension and post-retirement benefit plans benefit, net of tax benefit of $ 0 and $ 357 , respectively

Reclassification of pension liability adjustments to earnings, net of tax expense of $ 0 and benefit of $ 6 , respectively*

Total comprehensive income (loss) 3,214 ( 47,997 )

Pension and post-retirement benefit plans benefit, net of tax benefit $ 0

Reclassification of pension liability adjustments to earnings, net of tax expense of $ 424 and $ 0 , respectively*

Total comprehensive income 40,377 3,214

Less comprehensive loss attributable to noncontrolling interest:

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Amounts attributable to noncontrolling interest ( 26 ) ( 136 )

Comprehensive income (loss) attributable to L.B.

Comprehensive income attributable to L.B.

Foster Company $ 40,403 $ 3,350

* Reclassifications out of Accumulated other comprehensive loss for pension obligations are reflected in Selling and administrative expense.

* Reclassifications out of Accumulated other comprehensive loss for pension obligations are reflected in Selling and administrative expense and pension settlement costs are reflected in Other expense - net .

The accompanying notes are an integral part of these Consolidated Financial Statements.

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FOSTER COMPANY AND SUBSIDIARIES

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CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss) $ 1,299 $ ( 45,677 )

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

Net income $ 42,843 $ 1,299

Adjustments to reconcile net income to cash provided by operating activities:

Deferred income taxes ( 29,145 ) ( 1,852 )

1 unchanged sentence

Amortization 4,628 5,314

Asset impairments — 8,016

Equity income in nonconsolidated investment ( 51 ) ( 74 )

Equity loss (income) in nonconsolidated investment 14 ( 51 )

Gain on sales and disposals of property, plant, and equipment ( 4,431 ) ( 459 )

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Other liabilities 3,406 ( 1,537 )

Net cash provided by (used in) operating activities 37,376 ( 10,576 )

Net cash provided by operating activities 22,632 36,956

CASH FLOWS FROM INVESTING ACTIVITIES:

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Acquisitions, net of cash acquired ( 416 ) ( 1,246 )

Proceeds from asset divestiture 7,706 8,800

Net cash provided by (used in) investing activities 2,066 ( 56,418 )

Proceeds from asset divestitures — 7,706

Net cash (used in) provided by investing activities ( 6,312 ) 2,486

CASH FLOWS FROM FINANCING ACTIVITIES:

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Proceeds from debt 222,646 171,408

Debt issuance costs — ( 182 )

Treasury stock acquisitions ( 8,237 ) ( 2,625 )

Consideration received from noncontrolling interest — 589

Net cash (used in) provided by financing activities ( 39,296 ) 60,240

Net cash used in financing activities ( 16,231 ) ( 39,296 )

Effect of exchange rate changes on cash and cash equivalents ( 195 ) ( 468 )

4 unchanged sentences

Net interest paid $ 4,659 $ 5,454

Net income taxes received $ ( 221 ) $ ( 5,007 )

Net income taxes paid (received) $ 1,628 $ ( 221 )

The accompanying notes are an integral part of these Consolidated Financial Statements.

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FOSTER COMPANY AND SUBSIDIARIES

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Balance, December 31, 2022 $ 111 $ 41,303 $ 123,169 $ ( 6,240 ) $ ( 21,165 ) $ 420 $ 137,598

Net loss — — ( 45,564 ) — — ( 113 ) ( 45,677 )

Other comprehensive loss, net of tax:

Net income (loss) — — 1,464 — — ( 165 ) 1,299

Other comprehensive income (loss), net of tax:

Pension liability adjustment — — — — 191 — 191

Foreign currency translation adjustment — — — — 2,428 29 2,457

Unrealized derivative gain on cash flow hedges — — — — 1,755 — 1755

Cash flow hedges reclassified to earnings — — — — 159 — 159

Unrealized derivative loss on cash flow hedges — — — — ( 704 ) — ( 704 )

Purchase of 134,208 common shares for treasury

— — — ( 2,310 ) — — ( 2,310 )

Issuance of 91,316 common shares, net of shares withheld for taxes

1 unchanged sentence

Stock-based compensation — 4,179 — — — — 4,179

Investment of noncontrolling interest — — — — 440 440

Balance, December 31, 2023 111 43,111 124,633 ( 6,494 ) ( 19,250 ) 724 142,835

Net income (loss) — — 42,946 — — ( 103 ) 42,843

Other comprehensive income, net of tax:

Other comprehensive income (loss), net of tax:

Pension liability adjustment — — — — 1,014 — 1,014

9 unchanged sentences

The accompanying notes are an integral part of these Consolidated Financial Statements.

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FOSTER COMPANY AND SUBSIDIARIES

10 unchanged sentences

The Company maintains locations in North America, South America, Europe, and Asia.

Effective for the quarter and year ended December 31, 2023, the Company implemented operational changes in how its Chief Operating Decision Maker (“CODM”) manages its businesses, including resource allocation and operating decisions.

As a result of these changes, the Company now has two (previously three ) operating segments, representing the individual businesses that are run separately under the new structure:

The Company is organized and operated in two reporting segments:

Rail, Technologies, and Services (“Rail”) and Infrastructure Solutions (“Infrastructure”).

1 unchanged sentence

The Infrastructure segment is composed of nine operating facilities across the US providing engineered precast concrete solutions, as well as fabricated bridge, protective pipe coating, and pipe threading offerings across North America.

On November 17, 2023, the Company acquired the operating assets of Cougar Mountain Precast, LLC (“Cougar”), located in Caldwell, Idaho, which is a licensed manufacturer of Redi-Rock and natural concrete products for $ 1,644 , subject to working capital adjustments and hold back payments, to be paid over the next twelve months or utilized to satisfy post-close working capital adjustments or indemnity claims.

Cougar has been included in the Infrastructure segment.

Cougar has been included in the Precast Concrete Products business unit within the Infrastructure segment.

On August 30, 2023, the Company announced the discontinuation of its Bridge Products grid deck product line and expects to complete any remaining customer obligations in 2025.

The grid deck product line is reported in the Bridge Products business unit within the Infrastructure segment.

On June 30, 2023, the Company sold substantially all the operating assets of the prestressed concrete railroad tie business operated by its wholly-owned subsidiary, CXT Incorporated (“Ties”), located in Spokane, WA, for $ 2,362 in proceeds, subject to final working capital adjustments.

The grid deck product line is reported in the Bridge Products division within the Infrastructure segment.

The Ties business was reported in the Rail Products business unit within the Rail segment.

On March 30, 2023, the Company sold substantially all the operating assets of its Precision Measurement Products and Systems business, Chemtec Energy Services LLC (“Chemtec”), for $ 5,344 in proceeds, subject to final working capital adjustments.

The Chemtec business was reported in the Coatings and Measurement business unit within the Infrastructure segment.

On June 21, 2022, the Company acquired the stock of Skratch Enterprises Ltd.

(“Skratch”) for $ 7,402 , which is inclusive of deferred payments withheld by the Company of $ 1,228 , to be paid over the next five years or utilized to satisfy post-closing working capital adjustments or indemnity claims under the purchase agreement.

Skratch has been included in the Company’s Technology Services and Solutions business unit within the Rail segment.

On August 1, 2022 the Company divested the assets of its Track Components business for $ 7,795 in cash proceeds, subject to indemnification obligations and working capital adjustments.

The Track Components business was reported in the Rail Products business unit within the Rail segment.

On August 12, 2022, the Company acquired the operating assets of VanHooseCo Precast LLC (“VanHooseCo”) for $ 52,146 , net of cash acquired at closing, subject to the finalization of net working capital adjustments.

An amount equal to $ 2,500 of the purchase price was deposited into an escrow account to cover breaches of representations and warranties, all of which was released from escrow as of December 31, 2023.

VanHooseCo has been included in the Company’s Infrastructure segment.

The Chemtec business was reported in the Coatings and Measurement division within the Infrastructure segment.

Use of estimates

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Leasehold improvements are amortized over 3 to 19 years, which represent the lives of the respective leases or the lives of the improvements, whichever is shorter.

Depreciation expense is recorded within “Cost of goods sold,” “Cost of services sold,” and “Selling and administrative expenses” on the Consolidated Statements of Operations based upon the particular asset’s use.

Depreciation expense is recorded within “Cost of goods sold,” “Cost of services sold,” and “Selling and administrative expenses” on the Consolidated Statements of Operations

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based upon the particular asset’s use.

The Company reviews a long-lived asset for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

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Major renewals and betterments that substantially extend the useful life of the property are capitalized at cost.

Upon the sale or other disposition of assets, the costs and related accumulated depreciation and amortization are removed from the accounts and the resulting gain or loss, if any, is reflected in “Other expense (income) - net” in the Consolidated Statements of Operations.

Upon the sale or other disposition of assets, the costs and related accumulated depreciation and amortization are removed from the accounts and the resulting gain or loss, if any, is reflected in “Cost of goods sold,” “Cost of services sold,” and “Selling and administrative expenses” on the Consolidated Statements of Operations based upon the particular asset’s use.

Allowance for credit losses

The Company established the allowance for credit losses by calculating the amount to reserve based on the age of a given trade receivable and considering historical collection patterns, bad debt expense experience, expected future trends of collections, current and expected market conditions, and any other relevant subjective adjustments as needed.

Management maintains high-quality credit review practices and positive customer relationships that mitigate credit risks.

Management maintains high-quality credit review practices and positive customer relationships that we believe mitigates credit risks.

The Company’s reserves are regularly reviewed and revised as necessary.

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A reporting unit is an operating segment or a component of an operating segment for which discrete financial information is available and reviewed by management on a regular basis.

There was no change to the reporting units as a result of the 2023 change in reporting segments.

The goodwill impairment test involves comparing the fair value of a reporting unit to its carrying value, including goodwill.

When evaluating for impairment the Company may first consider qualitative factors to assess whether there are indicators that it is more likely than not that the fair value of a reporting unit may not exceed its carrying amount.

If we do not perform a qualitative assessment, or if we determine that it is more like than not that the fair value of the reporting unit does not exceed its carrying value, we perform a quantitative assessment by comparing the fair value of a reporting unit to its carrying value, including goodwill.

If the carrying amount of the reporting unit exceeds its fair value, an impairment loss equal to the excess amount up to the goodwill balance is recorded as a component of operations.

The Company performs its annual impairment tests in the fourth quarter.

The Company’s fourth quarter 2023 annual test included the assessment of a quantitative analysis to determine whether it was more likely than not that the fair value of each reporting unit is less than its carrying value.

The quantitative assessment considers fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The Company’s quantitative analysis considered and evaluated each of the three traditional approaches to value:

The Company's quantitative analysis considers and evaluates each of the three traditional approaches to value:

the income approach, the market approach, and the asset approach.

The Company uses a combination of a discounted cash flow method and a market approach to determine the fair values of the reporting units.

Any impairment charges are based on both historic and future expected business results that no longer support the carrying value of the reporting unit.

The Company performs its annual impairment tests in the fourth quarter.

The Company’s fourth quarter 2024 annual test included the assessment of a qualitative analysis to determine whether it was more likely than not that the fair value of each reporting unit is less than its carrying value and was not required to perform a quantitative assessment.

The qualitative assessment considers fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The qualitative assessment considered and evaluated a variety of events or factors that could influence the fair value of the reporting unit, including, but not limited to, actual and projected reporting unit profitability, changes in key personnel, legal and regulatory conditions, industry outlook, macroeconomic conditions, and the reporting units’ competitive position.

No impairment was recorded during 2024.

The Company also monitors the recoverability of the long-lived assets associated with the asset groups of the Company and the long-term financial projections of the businesses to assess for asset impairment.

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The Company’s revenues are comprised of product and service sales, including products and services provided under long-term agreements with its customers.

All revenue is recognized when the Company satisfies its performance obligations under the respective contract, either implicit or explicit, by transferring the promised product or rendering a service to its customer either when or as its customer obtains control of the product or the service is rendered.

All revenue is recognized when the Company satisfies its performance obligations under the respective

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contract, either implicit or explicit, by transferring the promised product or rendering a service to its customer either when or as its customer obtains control of the product or the service is rendered.

Deferred revenue consists of customer billings or payments received for which the revenue recognition criteria have not yet been met as well as contract liabilities (billings in excess of costs) on over time contracts.

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The translation adjustment is accumulated as a separate component of “Accumulated other comprehensive loss” within the Consolidated Balance Sheets.

Foreign currency transaction gains and losses are included in “Other income or expense.” For the years ended December 31, 2023 and 2022, foreign currency transaction loss of $ 77 and $ 434 , respectively, were included in “Other expense (income) - net” in the Consolidated Statements of Operations.

Foreign currency transaction gains and losses are included in “Other income or expense.” For the years ended December 31, 2024 and 2023, foreign currency transaction gain of $ 154 and foreign currency transaction loss of $ 77 , respectively, were included in “Other expense - net” in the Consolidated Statements of Operations.

Research and development

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For the years ended December 31, 2024 and 2023, research and development expenses were $ 2,831 and $ 2,555 , respectively, and were principally related to the Company’s friction management and railroad monitoring system products within the Rail segment.

Reclassifications

Certain accounts in the prior year consolidated financial statements have been reclassified for comparative purposes principally to conform to the presentation in the current year period, including the changes in business segments.

Recently issued accounting guidance

In November 2023, the FASB issued Accounting Standards Update 2023-07, “Segment Reporting (Topic 280):

In November 2023, the FASB issued Accounting Standards Update No.

2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which requires enhanced disclosures regarding significant segment expenses that are regularly reviewed by the chief operating decision maker (“CODM”) and included in each reported measure of segment profit or loss, including an amount for “other segment items” by reportable segment and a description of its composition.

ASU 2023-07 also requires entities to disclose the title and position of the CODM and an explanation of how the CODM uses reported measures of segment profit or loss to assess performance and allocate resources.

The amendments are effective 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 did not identify any material impact from the provision of ASU 2023-07 on its financial condition, results of operations, and cash flows.

In December 2023, the FASB issued Accounting Standards Update 2023-09, Income Taxes (Topic 740):

The Company adopted this guidance for the year ended December 31, 2024 and applied to the guidance retrospectively to all periods presented in the financial statements.

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expanded disclosures of the provision of ASU 2023-07 are included in Note 2.

ASU 2023-07 affects only disclosures with no impacts to the Company’s financial condition, results of operations, and cash flows.

In December 2023, the FASB issued Accounting Standards Update No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”).

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Business Segments

Effective for the quarter and year ended December 31, 2023, the Company implemented operational changes in how its CODM manages its businesses, including resource allocation and operating decisions.

As a result of these changes, the Company now has two operating segments, representing the individual businesses that are run separately under the new structure.

The Company's new reportable segments are:

the Rail, Technologies, and Services segment and Infrastructure Solutions segment.

The Company’s segments represent components of the Company (a) that engage in activities from which revenue is generated and expenses are incurred, (b) whose operating results are regularly reviewed by the CODM, who uses such information to make decisions about resources to be allocated to the segments, and (c) for which discrete financial information is available.

The Infrastructure segment is comprised of the previous Precast Concrete Products and Steel Products and Measurement (now Steel Products business unit) segments, and the Company has restated segment information for the historical periods presented herein to conform to the current presentation.

This change in segment presentation does not affect the Company’s consolidated statements of income, balance sheets, or statements of cash flows.

Operating segments are evaluated on their segment profit contribution to the Company’s consolidated results.

The Company determines its operating segments based on how the Company’s CODM, the Company’s President and Chief Executive Officer, manages the businesses, including resource allocation and operating decisions.

The Company is organized into two operating segments, which represent the individual businesses that are run separately within this operational structure.

Operating segments are evaluated on their segment operating income contribution to the Company’s consolidated results.

The Company considers the aggregation of operating segments into reporting segments based on the nature of offerings, nature of production services, the type or class of customer for products and services, methods used to distribute products and services, and economic and regulatory environment conditions.

The Company has two reportable segments:

Rail and Infrastructure.

The CODM uses segment operating income to determine resources to allocate to each segment (including personnel and financial resources) during the annual budgeting process.

The CODM evaluates segment performance regularly by comparing the segment operating income to the budgeted measure.

The Company’s Rail reporting segment consists of the Rail Products, Global Friction Management, and Technology Services and Solutions business units, which was evaluated based on the factors outlined above.

1 unchanged sentence

The Rail segment also provides a full line of new and used rail, trackwork, and accessories to railroads, mines, and other customers in the rail industry as well as designs and produces insulated rail joints, power rail, track fasteners, coverboards, and special accessories for mass transit and other rail systems.

In addition, the Rail segment provides controls, display, and telecommunication contract management solutions for the transit, control room, and customer information and display sectors to enhance safety, operational efficiency, and customer experience.

In addition, the Rail segment provides controls, displays, and telecommunication contract management solutions for the transit, control room, and customer information and display sectors to enhance safety, operational efficiency, and customer experience.

Cash proceeds from the transaction were $ 2,362 , generating a pre-tax loss of $ 1,009 .

The Ties business was reported in the Rail Products business unit within the Rail segment.

On June 21, 2022, the Company acquired the stock of Skratch.

Skratch is located in Telford, United Kingdom, and offers a single-point supply solution model for clients, and enabling large scale deployments of its intelligent digital signage solutions.

Skratch has been included in the Company’s Technology Services and Solutions business unit within the Rail segment.

Additionally, on August 1, 2022, the Company divested its Track Components business located in St-Jean-sur-Richelieu, Quebec, Canada.

Results of the Track Components business are included in the Company’s Rail Products business unit within the Rail segment.

Refer to Note 3 for further details on acquisitions and divestitures.

The Company’s Infrastructure segment produces precast concrete buildings and a variety of specialty precast concrete products for use in several infrastructure end markets, including transportation, energy, and general infrastructure.

The Company’s Infrastructure segment consists of the Precast Concrete Products and Steel Products business units.

The Precast Concrete Products business unit produces precast concrete buildings and a variety of specialty precast concrete products for use in several infrastructure end markets, including transportation, energy, and general infrastructure.

The precast concrete buildings are primarily used as restrooms, concession stands, and protective storage buildings in national, state, and municipal parks, while other precast products include sound walls, bridge beams, box culverts, septic tanks, and other custom pre-stressed products.

The segment also produces threaded pipe products for industrial water well and irrigation markets as well pipe coatings for oil and gas markets.

In addition, the segment sells bridge decking, bridge railing, structural steel fabrications, expansion joints, bridge forms and other products for highway construction and repair.

Lastly, this segment provides pipe coatings for oil and gas pipelines and utilities.

On March 30, 2023, the Company sold substantially all the operating assets of its Precision Measurement Products and Systems business, Chemtec Energy Services LLC (“Chemtec”).

The Chemtec business was reported in the Coatings and Measurement business unit within the Infrastructure segment.

On August 12, 2022, the Company acquired the operating assets of VanHooseCo, a privately-held business headquartered in Loudon, Tennessee.

VanHooseCo specializes in precast concrete walls, water management products, and traditional precast products for the industrial, commercial, and residential infrastructure markets and has been included in the Infrastructure segment.

Refer to Note 3 for further details on acquisitions and divestitures.

Segment profit from operations includes allocated corporate operating expenses.

Operating expenses related to corporate headquarter functions were allocated to each segment based on segment headcount, revenue contribution, or activity of the business units within the segments, based on the corporate activity type provided to the segment.

The expense allocation excludes certain corporate costs that are separately managed from the segments including interest, income taxes, and certain other items that are included in other income and expense and are managed on a consolidated basis.

The Company leased a facility in Lake County, Florida in 2024, which will produce precast concrete wall systems when operations commence in 2025.

The Steel Products business unit also produces threaded pipe products for industrial water well and irrigation markets as well pipe coatings for oil and gas markets.

In addition, the segment produces bridge forms, which will be a retained business, and products associated with the Bridge Exit which includes bridge decking, bridge railing, structural steel fabrications, and expansion joints.

On November 17, 2023, the Company acquired the operating assets of Cougar Mountain Precast, LLC (“Cougar”) which is a licensed manufacturer of Redi-Rock and natural concrete products for $ 1,644 .

Cougar has been included in the Precast Concrete Products business unit within the Infrastructure segment.

On March 30, 2023, the Company sold substantially all the operating assets of its Chemtec business, which was inclusive of its entire Precision Measurement Products and Services division, located in Willis, TX.

Cash proceeds from the transaction were $ 5,344 , resulting in a pre-tax loss of $ 2,065 .

The Chemtec business was reported in the Steel Products business unit within the Infrastructure segment.

On August 30, 2023, the Company announced the Bridge Exit which was reported in the Steel Products business unit within the Infrastructure segment.

The decision to exit the bridge grid deck product line was a result of a weak bridge grid deck market condition and outlook due to customer adoption of newer technologies replacing the grid deck solution.

The Company continues to operate its bridge forms product line which is a newer technology and not subject to the same challenging market conditions.

The Bedford, PA based operations supporting the discontinued bridge grid deck product line expect to complete any remaining customer obligations during 2025.

For the years ended December 31, 2024 and 2023, the product line had $ 3,700 and $ 6,146 in sales, respectively.

During 2024, the Company incurred an immaterial amount of exit costs, all of which were personnel expenses.

During 2023, the Company

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incurred $ 1,403 of Bridge Exit costs, of which $ 1,141 was recorded in “Cost of goods sold” and $ 262 was recorded in “Selling and administrative expenses.” These expenses included $ 474 in inventory write-downs, $ 667 in personnel related expenses, and $ 262 in other exit costs;

the majority of cash payments were made in early 2024.

During 2023 the Company also recorded a $ 1,977 reduction in net sales and a $ 3,051 reduction in gross profit stemming from changes in expected value of certain commercial projects associated with the Bridge Exit.

Segment operating income includes reportable segment gross profit and direct expenses such as salaries, benefits, restructuring, research and development, professional and purchased services expenditures, amortization expense, bad debt expense, and other segment expenses.

Additionally, segment operating income includes allocated corporate operating expenses associated with central services such as quality, logistics, environmental health and safety, information technology, insurance, and human resources.

Other corporate functional costs that are associated with the operating segments are also allocated to the segments such as finance, marketing, credit and collections, and treasury functions.

Operating expenses related to corporate headquarter functions are allocated to each segment based on segment headcount, revenue contribution, or activity of the business units within the segments, based on the corporate activity type provided to the segment.

Management believes the allocation of corporate operating expenses provides an accurate presentation of how the segments utilize corporate support activities.

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The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies found in Note 1.

The operating results and assets of the Company’s reportable segments were as follows as of and for the year ended December 31, 2023:

Net Sales Segment Operating Profit Segment Assets Depreciation/Amortization Expenditures for Long-Lived Assets

Certain corporate costs are separately managed on a consolidated basis and are not allocated to the operating segments.

These corporate costs include public company costs such as listing fees, audit fees, compliance costs, insurance costs, and Board of Directors fees.

Additionally, certain corporate executive management costs, including costs of the corporate executive leadership team, and corporate management stock-based compensation expenses are not allocated to the operating segments.

Finally, interest expense, income taxes, and certain other items included in other expense - net, which are managed on a consolidated basis, are not allocated to the operating segments.

The operating results of the Company’s reportable segments were as follows as of and for the years ended December 31:

Rail, Technologies, and Services

Infrastructure Solutions

Net sales $ 326,869 $ 203,896 $ 530,765

Cost of sales ( 254,400 ) ( 158,303 ) ( 412,703 )

Selling and administrative employment costs ( 32,002 ) ( 23,868 ) ( 55,870 )

Purchased services (1)

( 7,410 ) ( 6,336 ) ( 13,746 )

General administrative costs (2)

( 7,796 ) ( 4,735 ) ( 12,531 )

Amortization expense ( 3,349 ) ( 1,279 ) ( 4,628 )

Segment operating income $ 21,912 $ 9,375 $ 31,287

Reconciliation of segment operating income

Total segment operating income $ 31,287

Gain on sales of former joint venture facility 3,477

Interest expense - net ( 4,992 )

Other expense - net ( 1,076 )

Public company costs ( 5,755 )

Corporate executive management costs ( 5,726 )

Corporate management stock-based compensation ( 2,065 )

Other corporate expenses ( 705 )

Income before income taxes $ 14,445

(1) Purchased services costs include contractor services, insurance expenditures, rental expense, and legal services.

(2) General administrative costs generally include office supplies, utilities, advertising, bad debt expense, depreciation and restructuring expenditures.

Included in the Rail segment operating income for the year ended December 31, 2024, was a $ 1,134 expense related to restructuring.

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Included in the Infrastructure segment operating income for the year ended December 31, 2024 was gain on the sale of ancillary property within the Steel Products business unit for total consideration of $ 1,300 generating an $ 815 gain on sale recorded in “Cost of goods sold” and a $ 113 expense related to restructuring.

During the year ended December 31, 2024, the Company sold a former joint venture facility located in Magnolia, Texas generating a $ 3,477 gain on sale recorded in “Gain on sale of former joint venture facility” which is included as a component of corporate operating income.

Rail, Technologies, and Services

Infrastructure Solutions

$ 312,160 $ 231,584 $ 543,744

Cost of sales

( 247,126 ) ( 184,574 ) ( 431,700 )

Selling and administrative employment costs ( 33,181 ) ( 25,007 ) ( 58,188 )

Purchased services (1)

( 7,264 ) ( 6,397 ) ( 13,661 )

General administrative costs (2)

( 9,011 ) ( 4,942 ) ( 13,953 )

Amortization expense

( 3,272 ) ( 2,042 ) ( 5,314 )

Segment operating income

$ 12,306 $ 8,622 $ 20,928

Reconciliation of segment operating income

Total segment operating income $ 20,928

Interest expense - net ( 5,528 )

Other expense - net ( 2,635 )

Public company costs ( 4,814 )

Corporate executive management costs ( 3,807 )

Corporate management stock-based compensation ( 2,816 )

Other corporate expenses ( 384 )

Income before income taxes $ 944

(1) Purchased services costs include contractor services, insurance expenditures, rental expense, and legal services.

(2) General administrative costs generally include office supplies, utilities, advertising, bad debt expense, depreciation and restructuring expenditures.

Included in the Rail operating income for the year ended December 31, 2023 was a $ 1,862 expense related to bad debt due to a customer filing for administrative protection and a $ 676 expense related to restructuring, both of which were within the Company’s UK-based Technology Services and Solutions business.

Included in the Infrastructure segment operating income for the year ended December 31, 2023 were the Bridge Exit costs, as well as the sales and related gross profit impacts of the Bridge Exit.

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Reconciliations of reportable segment assets, depreciation and amortization, and expenditures for long-lived assets to the Company’s consolidated totals are as follows as of and for the years ended December 31:

Segment Assets Depreciation/Amortization Expenditures for Long-Lived Assets

Rail, Technologies, and Services $ 158,859 $ 4,793 $ 2,032

Infrastructure Solutions 123,755 7,417 6,366

Reportable segment total 282,614 12,210 8,398

Corporate 51,936 1,870 1,393

Total $ 334,550 $ 14,080 $ 9,791

Included in the Rail operating profit for the year ended December 31, 2023 was a $ 1,862 expense related to bad debt due to a customer filing for administrative protection and a $ 676 expense related to restructuring, both of which were within the Company’s UK based Technology Services and Solutions business.

The operating results and assets of the Company’s reportable segments were as follows as of and for the year ended December 31, 2022:

Net Sales Segment Operating Profit (Loss) Segment Assets Depreciation/Amortization Expenditures for Long-Lived Assets

Segment Assets Depreciation/Amortization Expenditures for Long-Lived Assets

Rail, Technologies, and Services $ 156,638 $ 5,172 $ 1,165

Infrastructure Solutions 130,247 8,262 2,349

Reportable segments total 286,885 13,434 3,514

Corporate 25,516 1,829 999

Total $ 312,401 $ 15,263 $ 4,513

Included in the Infrastructure operating loss for the year ended December 31, 2022 were pre-tax impairment charges of $ 8,016 associated with goodwill and intangible assets within the Steel Products business unit.

During 2023 and 2022, no single customer accounted for more than 10% of the Company’s consolidated net sales.

For the year ended December 31, 2024, net sales from one customer of the Rail segment represented approximately $ 71,800 of the Company's consolidated net sales.

During 2023, no single customer accounted for more than 10% of the Company’s consolidated net sales.

Sales between segments were immaterial and eliminated in consolidation.

Reconciliations of reportable segment net sales, profits, assets, depreciation/amortization, and expenditures for long-lived assets to the Company’s consolidated totals are as follows as of and for the years ended December 31:

Income from operations:

Total segment operating profit $ 21,928 $ 2,322

Interest expense - net ( 5,528 ) ( 3,340 )

Other (expense) income - net ( 3,666 ) 1,550

Corporate expense and other unallocated charges ( 11,790 ) ( 9,528 )

Income (loss) before income taxes $ 944 $ ( 8,996 )

Total segment assets $ 287,690 $ 335,225

Unallocated corporate assets 25,516 30,085

Assets $ 313,206 $ 365,310

Depreciation/Amortization:

Total segment depreciation/amortization $ 13,434 $ 13,284

Corporate depreciation/amortization 1,829 1,495

Depreciation/amortization $ 15,263 $ 14,779

Expenditures for Long-Lived Assets:

Total segment expenditures for long-lived assets $ 4,622 $ 4,318

Corporate expenditures for long-lived assets 311 3,315

Expenditures for long-lived assets $ 4,933 $ 7,633

The following table summarizes the Company’s sales by major geographic region in which the Company had operations for the years ended December 31:

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Total property, plant, and equipment - net $ 75,374 $ 75,579

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The following table summarizes the Company’s sales by major product and service line for the years ended December 31:

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Total net sales $ 530,765 $ 543,744

Acquisitions and Divestitures

Skratch Enterprises Ltd.

On June 21, 2022, the Company acquired the stock of Skratch for $ 7,402 , which is inclusive of deferred payments withheld by the Company of $ 1,228 , to be paid over the next five years or utilized to satisfy post-closing working capital adjustments or indemnity claims under the purchase agreement.

Located in Telford, United Kingdom, Skratch offers a single-point supply solution model for clients, and enables large scale deployments of its intelligent digital signage solutions.

Skratch’s service offerings include design, prototyping and proof of concept, hardware and software, logistics and warehousing, installation, maintenance, content management, and managed monitoring.

Skratch has been included in the Company’s Technology Services and Solutions business unit within the Rail segment.

VanHooseCo Precast LLC

On August 12, 2022, the Company acquired the operating assets of VanHooseCo, a privately-held business headquartered in Loudon, Tennessee specializing in precast concrete walls, water management products, and traditional precast products for the industrial, commercial, and residential infrastructure markets.

The Company acquired VanHooseCo for $ 52,146 , net of cash acquired at closing.

An amount equal to $ 2,500 of the purchase price was deposited in an escrow account in order to cover breaches of representations and warranties, all of which was released from escrow as of December 31, 2023.

The acquisition agreement includes two employment agreements whereby principals had the ability to earn up to an additional $ 1,000 dependent upon the successful completion of the principals’ employment agreements.

VanHooseCo has been included in the Company’s Precast Concrete Products business unit within the Infrastructure segment.

Acquisition Summary

Each transaction was accounted for under the acquisition method of accounting under US GAAP which requires an acquiring entity to recognize, with limited exceptions, all of the assets acquired and liabilities assumed in a transaction at fair value as of the acquisition date.

Goodwill primarily represents the value paid for each acquisition’s enhancement to the Company’s product and service offerings and capabilities, as well as a premium payment related to the ability to control the acquired assets, as well as the assembled workforce provided.

Acquisition costs for the year ended December 31, 2022 were $ 2,043 and were recognized as part of the Company’s selling and administrative expenses.

VanHooseCo contributed net sales of $ 17,788 and operating profit of $ 1,555 to the Company’s consolidated results for the period from August 12, 2022 through December 31, 2022.

The table below summarizes the Company’s results as though the VanHooseCo acquisition had been completed on January 1, 2022.

Certain of VanHooseCo’s historical amounts were reclassified to conform to the Company’s financial presentation of operations, which included recording inventory and property, plant, and equipment at fair market value, to establish intangible assets, to remove deferred compensation expense, and to include interest expense for the additional borrowings.

The following unaudited pro forma information is provided for informational purposes only, and they are not necessarily indicative of future consolidated results of operations.

Net sales $ 522,997

Net (loss) income attributable to L.B.

Foster Company ( 44,564 )

Diluted (loss) earnings per share

As reported $ ( 4.25 )

Pro forma $ ( 4.16 )

The following table summarizes estimated fair values of the assets acquired and liabilities assumed at the date of the VanHooseCo and Skratch acquisitions, including final purchase accounting adjustments as of December 31, 2023:

Allocation of purchase price VanHooseCo Skratch

Current assets, net of cash acquired on the acquisition date $ 11,138 $ 1,129

Property, plant, and equipment 30,410 174

Goodwill 8,463 5,549

Other intangibles 5,442 1,750

Liabilities assumed ( 3,307 ) ( 1,200 )

Total $ 52,146 $ 7,402

The following table summarizes estimates of the fair values of the VanHooseCo and Skratch identifiable intangible assets acquired:

VanHooseCo Skratch

Identifiable intangible assets Weighted Average

Period In Years Net

Amount Weighted Average

Period In Years Net

Non-compete agreements 0 $ — 1 $ 27

Customer relationships 5 3,578 3 1,349

Trademarks and trade names 10 1,537 10 374

Favorable lease 6 327 0 —

Total $ 5,442 $ 1,750

The Company made an allocation of the purchase price for the VanHooseCo and Skratch acquisitions as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities.

These fair value measurements are classified as Level 3 in the fair value hierarchy.

See Note 16 for a description of the fair value hierarchy.

There were no material purchase accounting adjustments made in 2023 as the Company finalized purchase accounting within the allowable measurement period.

Divestiture Summary

On August 1, 2022, the Company divested its Track Components business located in St-Jean-sur-Richelieu, Quebec, Canada.

Cash proceeds from the transaction were $ 7,795 , subject to indemnification obligations and working capital adjustments, resulting in a pre-tax loss of $ 467 .

The Track Components business was reported in the Rail Products business unit within the Rail segment.

Cash proceeds from the transaction were $ 5,344 , subject to final working capital adjustments, resulting in a pre-tax loss of $ 2,065 .

The Chemtec business was reported in the Steel Products business unit within the Infrastructure segment.

Cash proceeds from the transaction were $ 2,362 , subject to final working capital adjustments, generating a pre-tax loss of $ 1,009 .

The Ties business was reported in the Rail Products business unit within the Rail segment.

The Company’s revenues are comprised of product and service sales, including products and services provided under long-term agreements with its customers.

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Over time revenue is primarily comprised of transit infrastructure and technology services and solutions projects within the Rail segment, precast concrete buildings within the Precast Concrete Products division in the Infrastructure segment, and long-term bridge projects and custom precision metering systems within the Steel Products division in the Infrastructure segment.

Revenue under these long-

term agreements is generally recognized over time, either using an input measure based upon the proportion of actual costs incurred to estimated total project costs or an input measure based upon actual labor costs as a percentage of estimated total labor costs, depending upon which measure the Company believes best depicts the Company’s performance to date under the terms of the contract, or an output method, specifically units delivered, based upon certain customer acceptance and delivery requirements.

Revenue under these long-term agreements is generally recognized over time, either using an input measure based upon the proportion of actual costs incurred to estimated total project costs or an input measure based upon actual labor costs as a percentage of estimated total labor costs, depending upon which measure the Company believes best depicts the Company’s performance to date under the terms of the contract, or an output method, specifically units delivered, based upon certain customer acceptance and delivery requirements.

The Company records contract liabilities in “Deferred revenue” within the Consolidated Balance Sheets.

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As a result of management's reviews of contract-related estimates, the Company makes adjustments to contract estimates that impact our revenue and profit totals.

Changes in estimates are primarily attributed to updated considerations, including economic conditions and historic contract patterns, resulting in changes to anticipated revenue from existing contracts.

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estimates are primarily attributed to updated considerations, including economic conditions and historic contract patterns, resulting in changes to anticipated revenue from existing contracts.

In the event that a contract loss becomes known, the entire amount of the estimated loss is recognized in the Consolidated Statements of Operations.

The majority of the Company’s revenue is from products transferred and services rendered to customers at a point in time, which is inherent in all major product and service categories.

Point in time revenue accounted for 72.6 % and 72.7 % of revenue for the years ended December 31, 2023 and 2022, respectively.

Point in time revenue accounted for 72.6 % of revenue for each of the years ended December 31, 2024 and 2023.

The Company recognizes revenue at the point in time in which the customer obtains control of the product or service, which is generally when product title passes to the customer upon shipment or the service has been rendered to the customer.

In limited cases, title does not transfer upon shipment and revenue is not recognized until the customer has received the products at a designated physical location.

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For the years ended December 31, 2024 and 2023, net sales by the timing of the transfer of goods and services were as follows:

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Total net sales $ 312,160 $ 231,584 $ 543,744

During 2023, the Company recorded $ 8,718 in reductions to net sales stemming from changes in actual and expected values of certain commercial contracts, including $ 2,987 associated with the Bridge Exit and other settled contracts.

Such adjustments were $ 4,800 in 2022, including the $ 3,956 impact of the Crossrail Settlement.

See Note 2 for additional information for the Company’s net sales by major product and service category.

The timing of revenue recognition, billings, and cash collections results in billed receivables, costs in excess of billings (contract assets), and billings in excess of costs (contract liabilities), included in deferred revenue on the Consolidated Balance Sheets.

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Increase in billings in excess of costs, excluding revenue recognized 1,529

Other adjustments, including business divestiture ( 1,675 )

Other adjustments ( 317 )

Balance as of December 31, 2024 $ 1,991

The Company has established policies regarding allowance for credit losses associated with contract assets, which includes standalone reserve assessments for its long-term, complex contracts as needed as well as detailed regular review and updates to contract margins, progress, and value.

A standard reserve threshold is applied to contract assets related to short-term, less complex contracts.

Management also regularly reviews collection patterns and future expected collections and makes necessary revisions to allowance for credit losses related to contract assets.

During 2024, the Company recorded $ 2,593 in reductions to net sales stemming from changes in actual and expected values of certain commercial contracts.

Such adjustments were $ 8,718 in 2023, including $ 2,987 associated with the Bridge Exit and other settled contracts.

See Note 2 for additional information for the Company’s net sales by major product and service category.

As of December 31, 2024, the Company had approximately $ 185,909 of remaining performance obligations, which is also referred to as backlog.

Approximately 14.2 % of the backlog as of December 31, 2024 was related to projects that are anticipated to extend beyond December 31, 2025.

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Goodwill and Other Intangible Assets

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Foreign currency translation impact 518 — 518

Impairment charges — ( 3,011 ) ( 3,011 )

Balance as of December 31, 2023:

20,466 12,121 32,587

Acquisitions — 1,336 1,336

Cougar purchase accounting adjustment — ( 445 ) ( 445 )

Foreign currency translation impact ( 235 ) — ( 235 )

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$ 20,231 $ 11,676 $ 31,907

In conjunction with our annual goodwill impairment test performed during the fourth quarter of 2023, the Company determined it was necessary to perform a quantitative test for impairment of goodwill due to weakened economic conditions, unfavorable changes in foreign exchange rates, and recent increases in the cost of certain materials, labor, and other inflation-related pressures unfavorably impacted the financial results.

The Company determined the implied fair values of its reporting units by using Level 3 unobservable inputs, which incorporated assumptions that we believe would be a reasonable market participant’s view in a hypothetical purchase, to develop the discounted cash flows of the respective reporting units.

Significant Level 3 inputs included estimates of future revenue growth, earnings before interest, taxes, depreciation, and amortization (“EBITDA”) contribution, and market participant assumptions.

The results of the test indicated that all reporting units that maintain goodwill adequately exceeded their carrying value and were not subject to impairment.

However, headroom in the Rail Technologies and Precast Concrete Products reporting units indicate that should results or future projections diverge from current expectations, the reporting units could be subject to future impairment.

As a result of the procedures performed as outlined above, no impairments were recorded in 2023.

In the fourth quarter of 2022, the Company impaired 100 % of goodwill held in the Fabricated Bridge reporting unit, resulting in a non-cash pre-tax impairment charge of $ 3,011 .

On November 17, 2023, the Company acquired Cougar Mountain Precast, LLC., for which all purchase accounting adjustments were finalized as of March 31, 2024.

Purchase accounting finalization during the three months ended March 31, 2024 included adjustments to record $ 429 of gross intangible assets for customer relationships with a weighted average amortization period of 5 years and other immaterial adjustments.

The Company elected to perform a qualitative assessment as an annual test of goodwill impairment in the fourth quarter of 2024 and, as a result of this assessment, the Company determined a quantitative assessment was not necessary and no impairments were recorded in 2024.

However, future impairment charges could result if future projections diverge unfavorably from current expectations.

As of December 31, 2024 and 2023, the components of the Company’s intangible assets were as follows:

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Amortization Net

Non-compete agreements 1 $ 27 $ ( 16 ) $ 11

Patents 10 $ 335 $ ( 199 ) $ 136

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During the year ended December 31, 2023, certain fully amortized intangible assets of $ 27 related to non-compete agreements were eliminated from gross intangible assets and accumulated amortization.

During the year ended December 31, 2022, the Company’s gross carrying value of customer relationships and technology intangible assets were reduced by $ 5,448 and $ 471 , respectively, and the net carrying amount of customer relationships and technology intangible assets were reduced by $ 2,869 and $ 7 , respectively, as a result of the August 1, 2022 disposition of the Track Components business.

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Estimated annual amortization expense for the years ending December 31, 2025 and thereafter is as follows:

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2030 and thereafter 4,605

During the year ended December 31, 2022, management performed a recoverability test on a reporting unit for which there was an indication that it was more likely than not that the carrying value of the long-lived asset group would not be recoverable.

As a result of the analysis and valuation exercises performed, in the fourth quarter of 2022, the Company recorded $ 4,883 in non-cash, pre-tax impairment charges associated with the Company's Precision Measurement Products and Systems business based in Willis, TX, equal to 100% of their carrying value.

Impairment was inclusive of $ 3,828 , $ 394 , and $ 661 related to customer relationships, trade name, and developed technology, respectively.

On June 21, 2022, the Company acquired the stock of Skratch Enterprises Ltd.

On August 12, 2022, the Company acquired the operating assets of VanHooseCo Precast LLC (“VanHooseCo”).

As of December 31, 2023, the purchase accounting for these transactions is final.

Purchase accounting adjustments recognized during the year ended December 31, 2023 were immaterial.

Accounts Receivable

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Changes in reserves for uncollectible accounts are recorded as part of “Selling and administrative expenses” in the Consolidated Statements of Operations, and were an expense of $ 365 and $ 1,912 for the years ended December 31, 2024 and 2023, respectively.

The changes in reserves for uncollectible accounts are net of recoveries of previous write-offs of $ 335 for the year ended December 31, 2024.

Management maintains high-quality credit review practices and positive customer relationships that we believe mitigates credit risks.

The Company’s reserves are regularly reviewed and revised as necessary.

The following table sets forth the Company’s allowance for credit losses:

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December 31, 2023 $ 809

Current period provision 1,020

Additions to the current period provision 700

Write-off against allowance ( 47 )

Recoveries of previous write-offs ( 335 )

December 31, 2024 $ 1,127

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Inventories - net $ 70,506 $ 73,111

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Property, Plant, and Equipment

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The Company determines if an arrangement is a lease at its inception.

Operating leases are included in “Operating lease right-of-use assets,” “Other current liabilities,” and “Long-term operating lease liabilities” within the Consolidated Balance Sheets.

Operating leases are included in “Operating lease right-of-use assets,” “Other accrued liabilities,” and “Long-term operating lease liabilities” within the Consolidated Balance Sheets.

Finance leases are included in “Property, plant, and equipment - net,” “Current maturities of long-term debt,” and “Long-term debt” in the Consolidated Balance Sheets.

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Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term.

As most of the Company’s leases

do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of the lease payments.

As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of the lease payments.

The Company uses the implicit rate when readily determinable.

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Operating lease right-of-use assets $ 18,480 $ 14,905

Other current liabilities $ 3,040 $ 3,128

Other accrued liabilities $ 3,771 $ 3,040

Long-term operating lease liabilities 14,709 11,865

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Total finance lease liabilities $ 473 $ 213

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The components of lease expense within the Consolidated Statements of Operations were as follows for the years ended December 31, 2024 and 2023:

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2027 3,607 66

2028 3,151 65

2029 2,750 65

2030 and thereafter 2,417 60

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Total $ 18,480 $ 473

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Long-Term Debt and Related Matters

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On August 13, 2021, the Company, its domestic subsidiaries, and certain of its Canadian and United Kingdom subsidiaries (collectively, the “Borrowers”), entered into the Fourth Amended and Restated Credit Agreement (the “Credit Agreement”) with PNC Bank, N.A., Citizens Bank, N.A., Wells Fargo Bank, National Association, Bank of America, N.A., and BMO Harris Bank, National Association.

The Credit Agreement, as amended, modifies the prior revolving credit facility, as amended, on terms more favorable to the Company and extends the maturity date from April 30, 2024 to August 13, 2026.

The Credit Agreement provides for a five-year , revolving credit facility that permits aggregate borrowings of the Borrowers up to $ 130,000 with a sublimit of the equivalent of $ 25,000 US dollars that is available to the Canadian and United Kingdom borrowers in the aggregate.

The Credit Agreement’s

incremental loan feature permits the Company to increase the available commitments under the facility by up to an additional $ 50,000 subject to the Company’s receipt of increased commitments from existing or new lenders and the satisfaction of certain conditions.

The Credit Agreement includes two financial covenants:

(a) Maximum Gross Leverage Ratio, defined as the Company’s consolidated Indebtedness (as defined in the Credit Agreement) divided by the Company’s consolidated EBITDA, which must not exceed (i) 3.25 to 1.00 for all testing periods other than during an Acquisition Period, and (ii) 3.50 to 1.00 for all testing periods occurring during an Acquisition Period (as defined in the Credit Agreement), and (b) Minimum Consolidated Fixed Charge Coverage Ratio, defined as the Company’s consolidated EBITDA divided by the Company’s Fixed Charges (as defined in the Credit Agreement), which must be more than 1.05 to 1.00.

On August 12, 2022, the Company entered into a second amendment to its Credit Agreement (the “Second Amendment”) to obtain approval for the VanhooseCo acquisition and temporarily modify certain financial covenants to accommodate the transaction.

The Second Amendment permitted the Company to acquire the operating assets of VanHooseCo and modified the Maximum Gross Leverage Ratio covenant through June 30, 2023 to accommodate the transaction.

The Second Amendment also added an additional tier to the pricing grid and provided for the conversion from LIBOR-based to SOFR-based borrowings.

The Credit Agreement, as amended, modifies the prior amended revolving credit facility, on terms more favorable to the Company and extends the maturity from April 30, 2024 to August 13, 2026.

The Credit Agreement provides for a five-year , revolving credit facility that permits aggregate borrowings of the Borrowers up to $ 130,000 with a sublimit of the equivalent of $ 25,000 U.S.

dollars that is available to the Canadian and United Kingdom borrowers in the aggregate.

The Credit Agreement’s incremental loan feature permits the Company to increase the available commitments under the facility by up to an additional $ 50,000 subject to the Company’s receipt of increased commitments from existing or new lenders and the satisfaction of certain conditions.

On August 12, 2022, the Company entered into a second amendment to its Credit Agreement (the “Second Amendment”) which added an additional tier to the pricing grid and provided for the conversion from LIBOR-based to SOFR-based borrowings.

Borrowings under the Credit Agreement, as amended, will bear interest at rates based upon either the base rate or SOFR rate plus applicable margins.

Applicable margins are dictated by the ratio of the Company’s total net indebtedness to the Company’s consolidated EBITDA for four trailing quarters, as defined in the Credit Agreement.

The base rate is the highest of (a) the Overnight Bank Funding Rate plus 50 basis points, (b) the Prime Rate, or (c) the Daily Simple SOFR rate plus 100 basis points so long as the Daily Simple SOFR rate is offered, ascertainable, and not unlawful (each as defined in the Credit Agreement).

The base rate and LIBOR rate spreads range from 25 to 150 basis points and 125 to 250 basis points, respectively.

The obligation of the Company and its domestic, Canadian, and United Kingdom subsidiaries (the “Guarantors”) under the Credit Agreement is secured by the grant of a security interest by the Borrowers and Guarantors in substantially all of the assets owned by such entities.

Additionally, the equity interests in each of the loan parties, other than the Company, and the equity interests held by each loan party in their subsidiaries, will be pledged to the lenders as collateral for the lending obligations.

Other restrictions exist at all times including, but not limited to, limitations on the Company’s sale of assets and the incurrence by either the Borrowers or the non-borrower subsidiaries of the Company of other indebtedness, guarantees, and liens.

As of December 31, 2023, the Company was in compliance with the covenants in the Credit Agreement, as amended.

The Credit Agreement includes two financial covenants:

(a) Maximum Gross Leverage Ratio, defined as the Company’s consolidated Indebtedness (as defined in the Credit Agreement) divided by the Company’s consolidated EBITDA, which must not exceed (i) 3.25 to 1.00 for all testing periods other than during an Acquisition Period (as defined in the Credit Agreement), and (ii) 3.50 to 1.00 for all testing periods occurring during an Acquisition Period, and (b) Minimum Consolidated Fixed Charge Coverage Ratio, defined as the Company’s consolidated EBITDA divided by the Company’s Fixed Charges (as defined in the Credit Agreement), which must be more than 1.05 to 1.00.

As of December 31, 2024 and 2023, the Company was in compliance with the covenants in the Credit Agreement, as amended.

As of December 31, 2024 and 2023, the Company had outstanding letters of credit of approximately $ 1,409 and $ 2,807 , respectively, and had net available borrowing capacity of $ 82,124 and $ 72,133 , respectively, subject to covenant restrictions.

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As of December 31, 2024 and 2023, the Company withheld 59,577 and 24,886 shares for approximately $ 1,429 and $ 315 , respectively, from employees to pay their withholding taxes in connection with the vesting of restricted stock awards.

During the first quarter of 2023, the Company's Board of Directors authorized the repurchase of up to $ 15,000 of the Company's common stock in open market transactions through February 2026.

Repurchases are limited to up to $ 5,000 in any trailing 12-month period, with unused amounts carrying forward to future periods through the end of the authorization.

Any repurchases will be subject to the Company’s liquidity, including availability of borrowings and covenant compliance under its revolving credit facility, and other capital needs of the business.

In connection with the stock repurchase program, 134,208 shares valued at $ 2,310 were repurchased during the year ended December 31, 2023 and no shares were repurchased for the year ended December 31, 2022.

During the first quarter of 2023, the Company's Board of Directors authorized the repurchase of up to $ 15,000 of the Company's common stock in open market transactions.

Repurchases of shares of the Company’s common stock may be made from time to time in the open market or in such other manner as determined by the Company.

The timing of the repurchases and the actual amount repurchased will depend

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on a variety of factors, including the market price of the Company’s shares, general market and economic conditions, and other factors.

The stock repurchase program does not obligate the Company to acquire any particular amount of common stock and may be suspended or discontinued at any time.

On August 5, 2024, the Board of Directors approved the modification of the Company’s stock repurchase program.

The modifications include revising the repurchase program expiration date from February 2026 to February 2025.

Additionally, the Board of Directors removed the restriction which previously limited repurchases to $ 5,000 in any trailing 12-month period.

The authorized repurchase amount was unchanged at $ 15,000 .

In connection with the stock repurchase program, 300,302 shares valued at $ 6,808 were repurchased during the year ended December 31, 2024 and 134,208 shares valued at $ 2,310 were repurchased during the year ended December 31, 2023.

There were no dividends declared during the years ended December 31, 2024 and 2023.

On March 3, 2025, the Company's Board of Directors authorized the repurchase of up to $ 40,000 of the Company's common stock in open market transactions and/or 10b5-1 trading plans through February 29, 2028, as discussed in Note 20.

Treasury Outstanding

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Issued for stock-based compensation plans ( 91,316 ) 91,316

Repurchased common stock 134,208 ( 134,208 )

Balance at end of 2023 381,844 10,733,935

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Accumulated other comprehensive loss $ ( 21,716 ) $ ( 19,250 )

During the year ended December 31, 2024, the Company reclassified $ 1,174 of pension and post-retirement benefit plan adjustments from “Accumulated other comprehensive loss” to “Other expense - net” as a result of the termination our frozen L.B.

Foster Company Merged Retirement Plan, discussed further in Note 16.

Foreign currency translation adjustments are generally not adjusted for income taxes as they relate to indefinite investments in non-US subsidiaries.

See Note 13 for further information.

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Earnings Per Common Share

(Share amounts in thousands)

The following table sets forth the computation of basic and diluted earnings (loss) per common share for the years ended December 31, 2023 and 2022:

The following table sets forth the computation of basic and diluted earnings per common share for the years ended December 31, 2024 and 2023:

Year Ended December 31,

Numerator for basic and diluted earnings (loss) per common share:

Net income (loss) attributable to L.B.

Numerator for basic and diluted earnings per common share:

Net income attributable to L.B.

Foster Company $ 42,946 $ 1,464

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Denominator for diluted earnings per common share - adjusted weighted average shares outstanding and assumed conversions 11,048 10,995

Basic earnings (loss) per common share $ 0.14 $ ( 4.25 )

Diluted earnings (loss) per common share $ 0.13 $ ( 4.25 )

There were 0 and 75 anti-dilutive shares for the years ended December 31, 2023 and December 31, 2022, respectively.

Income (loss) before income taxes, as shown in the accompanying Consolidated Statements of Operations, includes the following components for the years ended December 31, 2023 and 2022:

Basic earnings per common share $ 4.01 $ 0.14

Diluted earnings per common share $ 3.89 $ 0.13

Income before income taxes, as shown in the accompanying Consolidated Statements of Operations, includes the following components for the years ended December 31, 2024 and 2023:

Year Ended December 31,

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Foreign ( 6,755 ) ( 13,631 )

Income (loss) before income taxes $ 944 $ ( 8,996 )

Income before income taxes $ 14,445 $ 944

Significant components of the provision for income taxes for the years ended December 31, 2024 and 2023 were as follows:

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Total income tax (benefit) expense $ ( 28,398 ) $ ( 355 )

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The reconciliation of income tax computed at statutory rates to income tax expense for the years ended December 31, 2024 and 2023 is as follows:

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Total income tax (benefit) expense / effective rate

$ ( 28,398 ) ( 196.6 ) % $ ( 355 ) ( 37.6 ) %

Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2024 and 2023 were as follows:

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Depreciation ( 7,845 ) ( 8,596 )

Pension and post-retirement liability ( 410 ) —

Unrealized income on interest rate swap contracts ( 110 ) ( 306 )

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Net deferred tax (liabilities) assets $ 27,750 $ ( 1,232 )

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A valuation allowance is required to be established or maintained when, based on currently available information and other factors, it is more likely than not that all or a portion of a deferred tax asset will not be realized.

The Company has considered all available evidence, both positive and negative, in assessing the need for a valuation allowance in each jurisdiction.

The Company has reported cumulative financial losses in recent years, which is a significant piece of negative evidence that typically limits a Company’s ability to consider more subjective forms of evidence.

Although many of our deferred tax assets have indefinite carryforward periods, we determined it was not appropriate to place significant weight on forecasted income in future periods given the subjective nature of such forecasts and our cumulative losses in recent years.

A valuation allowance of $ 40,125 was recorded at December 31, 2023 to recognize only the amount of deferred tax assets more likely than not to be realized.

The amount of deferred tax assets considered realizable, however, could be adjusted if objective negative evidence in the form of cumulative financial losses is no longer present, and additional weight is given to subjective evidence such as our projections for growth.

During 2024, the Company reversed $ 34,210 of its valuation allowance previously recorded against certain U.S.

federal and state deferred tax assets.

The positive evidence considered in evaluating U.S.

federal and state deferred tax assets included the Company's cumulative financial income position over the previous three years, as well as the composition and reversal patterns of existing taxable and deductible temporary differences between financial reporting and tax.

Based on our evaluation, the Company believed it was appropriate to rely on forecasted future taxable income to support its U.S.

federal and state deferred tax assets.

The amount of deferred tax assets considered realizable, however, could be adjusted if negative evidence outweighs additional subjective evidence such as the Company's projections for growth.

As of December 31, 2024, the Company had a federal Net Operating Loss (“NOL”) carryforward of $ 93,344 , which is limited to 80% of taxable income annually, but may be carried forward indefinitely.

The Company also has federal research tax credit carryforwards in the amount of $ 1,228 that will expire at various times from 2036 through 2044.

Based on information available as of December 31, 2023, the Company believes it is more likely than not that the tax benefits from the federal loss carryforwards and research tax credit carryforwards will not be realized.

In recognition of this risk, we have provided a full valuation allowance against deferred tax assets related to federal NOL and research tax credit carryforwards at December 31, 2023.

Based on information available as of December 31, 2024, the Company believes it is more likely than not that the tax benefits from the federal loss carryforwards and research tax credit carryforwards will be realized.

As of December 31, 2024 and 2023, the tax benefit of NOL carryforwards available for state income tax purposes was $ 9,802 and $ 10,137 , respectively.

Many state NOL carryforwards will expire in various years through 2044, while some may be carried forward indefinitely.

Based on information available as of December 31, 2023, the Company believes it is more likely than not that the tax benefit from state operating loss carryforwards will not be realized.

In recognition of this risk, the Company has provided a full valuation allowance against deferred tax assets related to state operating loss carryforwards as of December 31, 2023.

Based on information available as of December 31, 2024, the Company believes it is more likely than not that a portion of the tax benefit from state operating loss carryforwards will not be realized.

In recognition of this risk, the Company has provided a valuation allowance of $ 2,153 against deferred tax assets related to state operating loss carryforwards as of December 31, 2024.

As of December 31, 2024, the Company has NOL carryforwards in certain foreign jurisdictions of $ 26,346 , which may be carried forward indefinitely.

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Based on information available as of December 31, 2024, the Company believes it is more likely than not that the tax benefit from these loss carryforwards will not be realized.

In recognition of this risk, it

has provided a valuation allowance of $ 3,761 , collectively, against deferred tax assets in foreign jurisdictions as of December 31, 2023.

The determination to record or not record a valuation allowance involves managements’ judgment, based on the consideration of positive and negative evidence available at the time of the assessment.

In recognition of this risk, it has provided a valuation allowance of $ 6,070 , collectively, against deferred tax assets in foreign jurisdictions as of December 31, 2024.

The determination to record or not record a valuation allowance involves management's judgment, based on the consideration of positive and negative evidence available at the time of the assessment.

Management will continue to assess the realization of its deferred tax assets based upon future evidence, and may record adjustments to valuation allowances against deferred tax assets in future periods, as appropriate, that could materially impact net income.

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With respect to the state, local, and foreign filings, certain entities of the Company are subject to income tax examinations for the 2020 period and thereafter.

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Stock-based Compensation

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As of December 31, 2024, unrecognized compensation expense for awards that the Company expects to vest approximated $ 5,154 .

The Company will recognize this unrecognized compensation expense over approximately 2.3 years.

The Company will recognize this unrecognized compensation expense over approximately 2.2 years through February 13, 2027.

Shares issued as a result of vested stock-based compensation generally will be from previously issued shares that have been reacquired by the Company and held as treasury stock or authorized but previously unissued common stock.

As of December 31, 2023, the Company had stock awards issued pursuant to the Omnibus Plan and the Equity and Incentive Plan.

As of December 31, 2024, the Company had stock awards issued pursuant to the 2022 Equity and Incentive Compensation Plan (the “Equity and Incentive Compensation Plan”) and its predecessor, the 2006 Omnibus Incentive Compensation Plan (the “Omnibus Plan”).

The Omnibus Plan allowed for the issuance of 2,058,000 shares of common stock through the granting of stock options or stock awards (including performance units convertible into stock) to key employees and directors at no less than 100% of fair market value on the date of the grant.

The Equity and Incentive Plan allows for the issuance of 854,077 shares of common stock, which includes 765,000 shares that were authorized under the Equity and Incentive Compensation Plan and 89,077 shares remaining available for the Omnibus Incentive Plan, through the granting of stock options or stock awards (including performance units and restricted stock units convertible into stock) to key employees and directors at no less than 100% of fair market value on the date of the grant.

The total number of shares of common stock available for issuance, including shares that were forfeited, cancelled, expired, settled for cash, or unearned under the Omnibus Plan, were available for awards under the Equity and Incentive Plan as of its approval date.

The Omnibus Plan and Equity and Incentive Plan provide for the granting of “nonqualified options” with a duration of not more than ten years from the date of grant.

The Omnibus Plan and Equity and Incentive Plan also provide that, unless otherwise set forth in the option agreement, stock options are exercisable in installments of up to 25 % annually beginning one year from the date of grant.

No stock options have been granted under the Omnibus Plan or Equity and Incentive Plan and, as such, there was no stock-based compensation expense related to stock options recorded in 2023 and 2022.

The Equity and Incentive Compensation Plan allows for the issuance of 1,924,077 shares of common stock, which includes 1,835,000 shares that were authorized under the Equity and Incentive Compensation Plan and 89,077 shares remaining available for the Omnibus Incentive Plan, through the granting of stock options or stock awards (including performance units and restricted stock units convertible into stock) to key employees and directors at no less than 100% of fair market value on the date of the grant.

The Omnibus Plan and Equity and Incentive Compensation Plan provide for the granting of “nonqualified options” with a duration of not more than ten years from the date of grant.

The Omnibus Plan and Equity and Incentive Compensation Plan also provide that, unless otherwise set forth in the option agreement, stock options are exercisable in installments of up to 25 % annually beginning one year from the date of grant.

No stock options have been granted under the Omnibus Plan or Equity and Incentive Compensation Plan and, as such, there was no stock-based compensation expense related to stock options recorded in 2024 and 2023.

Non-Employee Director Fully-Vested and Restricted Stock Awards

Since May 2018, non-employee directors have been awarded shares of the Company’s common stock on each date the non-employee directors were elected at the annual shareholders’ meeting to serve as directors, subject to a one-year vesting requirement.

During the quarter ended June 30, 2017, the Nomination and Governance Committee and Board of Directors jointly approved the

Deferred Compensation Plan for Non-Employee Directors under the Omnibus Plan and, by amendment, under the Equity and Incentive Compensation Plan, which permits non-employee directors of the Company to defer receipt of earned cash and/or stock compensation for service on the Board.

During 2023 and 2022, the non-employee directors were granted a total of 39,312 and 45,840 restricted shares, respectively, which fully-vested as of December 31, 2023 and 2022, respectively.

The Deferred Compensation Plan for Non-Employee Directors under the Omnibus Plan and, by amendment, under the Equity and Incentive Compensation Plan, which permits non-employee directors of the Company to defer receipt of earned cash and/or stock compensation for service on the Board into deferred stock units.

Non-Employee directors may elect to receive quarterly cash compensation in the form of fully-vested stock.

During 2024, a Board member has elected to receive fully vested stock in lieu of cash compensation.

During 2024 and 2023, the non-employee directors were granted a total of 22,458 and 39,312 restricted shares, respectively.

Compensation expense recorded by the Company related to such awards to non-employee directors was approximately $ 589 and $ 468 for the years ended December 31, 2024 and 2023, respectively.

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The weighted average fair value of all the restricted stock grants awarded was $ 27.45 and $ 13.00 per share for the years ended December 31, 2024 and 2023, respectively.

Restricted Stock Awards and Performance Unit Awards

Under the Equity and Incentive Plan and Omnibus Plan, the Company grants certain employees restricted stock and performance unit awards.

Restricted Stock and Performance-Based Stock and Share Units

Under the Equity and Incentive Compensation Plan and Omnibus Plan, the Company grants certain employees restricted stock and performance-based stock and share units.

The forfeitable restricted stock awards granted generally time-vest ratably over a three-year period, unless indicated otherwise by the underlying restricted stock award agreement.

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The change is recognized in the current period for the performance unit awards and would change future expense over the remaining service period.

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The following table summarizes the restricted stock award, deferred stock units, and performance unit award activity for the years ended December 31, 2024 and 2023:

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Aggregate Grant Date

Outstanding as of January 1, 2022 135,704 74,950 116,571 $ 19.75

Outstanding as of December 31, 2022 174,173 46,268 108,478 $ 17.77

Granted 181,914 — 367,558 11.78

Vested ( 88,367 ) ( 33,864 ) — 15.97

Adjustment for incentive awards — — ( 105,598 ) 16.67

Net adjustment for incentive awards — — 84,302 13.75

Canceled and forfeited ( 2,750 ) — — 14.46

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Vested ( 148,808 ) ( 12,404 ) ( 29,778 ) 14.51

Adjustment for incentive awards — — 84,302 13.75

Net adjustment for incentive awards — — ( 82,374 ) 17.46

Canceled and forfeited ( 3,417 ) — ( 437 ) 14.43

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Performance Stock Units are adjusted to the Company’s expected performance target attainment, while the weighted average aggregate grant date fair value in the above table is based upon achieving 100% of the performance targets as defined in the underlying plan.

In June 2022, under the Equity and Incentive Plan, the Company approved the Strategy Transformation Plan performance-based incentive stock award to incentivize key personnel for the strategic transformation of the Company.

In June 2022, under the Equity and Incentive Compensation Plan, the Company approved the Strategy Transformation Plan performance-based incentive stock award to incentivize key personnel for the strategic transformation of the Company.

Under the four-year program, participants shall be eligible for a performance stock unit award of Company common stock with 50 % of the shares earned based on the achievement of EBITDA Margin and 50 % of the shares earned based on the Company’s stock price for the projected payout.

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The value of any shares awarded will be determined using a Monte Carlo methodology for the projected payout.

No shares earned are paid prior to March 1, 2024, and the program and opportunity to earn the shares expires on February 28, 2026.

The program and opportunity to earn the shares expires on February 28, 2026.

Excluding the restricted stock awards granted to non-employee directors, the Company recorded stock-based compensation expense of $ 3,245 and $ 3,711 , respectively, for the periods ended December 31, 2024 and 2023 related to restricted stock and performance unit awards.

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The classification of a financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

The Company has an established process for determining fair value for its financial assets and liabilities, principally cash and cash equivalents and interest rate swaps.

Fair value is based on quoted market prices, where available.

If quoted market prices are not available, fair value is based on assumptions that use as inputs market-based parameters.

The following section describes the valuation methodologies used by the Company to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which each instrument is generally classified.

Where appropriate, the description includes details of the key inputs to the valuations and any significant assumptions.

Cash equivalents - Included within “Cash and cash equivalents” are investments in non-domestic term deposits.

The carrying amounts approximate fair value because of the short maturity of the instruments.

SOFR-based interest rate swaps - To reduce the impact of interest rate changes on outstanding variable-rate debt, the Company amended and entered into forward-starting SOFR-based interest rate swaps, with notional values totaling $ 20,000 and $ 20,000 effective August 12, 2022 and August 31, 2022, respectively.

The fair value of the interest rate swaps is based on market-observable forward interest rates and represents the estimated amount that the Company would pay to terminate the agreements.

The fair value of the interest rate swaps is based on market-observable forward interest rates and represents the estimated amount that the Company would

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pay to terminate the agreements.

As such, the swap agreements are classified as Level 2 within the fair value hierarchy.

As of December 31, 2024 and December 31, 2023, the interest rate swaps were recorded in “Other current assets” when the interest rate swaps’ fair market value are in an asset position and “Other accrued liabilities” when in a liability position within our Consolidated Balance Sheets.

The following assets and liabilities of the Company were measured at fair value on a recurring basis subject to the disclosure requirements of ASC 820, “Fair Value Measurement” (“ASC 820”) as of December 31, 2023 and 2022:

Fair Value Measurements as of December 31, 2024 Fair Value Measurements as of December 31, 2023

December 31, 2023 Quoted Prices in Active Markets for Identical Assets

(Level 1) Significant Other Observable Inputs

(Level 2) Significant Unobservable Inputs

(Level 3) December 31, 2022 Quoted Prices in Active Markets for Identical Assets

(Level 1) Significant Other Observable Inputs

(Level 2) Significant Unobservable Inputs

Term deposits $ — $ — $ — $ — $ 17 $ 17 $ — $ —

December 31, 2024 Level 1 Level 2 Level 3 December 31, 2023 Level 1 Level 2 Level 3

Interest rate swaps $ 430 $ — $ 430 $ — $ 1,225 $ — $ 1,225 $ —

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The gains and losses related to the interest rate swaps are reclassified from “Accumulated other comprehensive loss” in our Consolidated Balance Sheets and included in “Interest expense - net” in our Consolidated Statements of Operations as the interest expense from our debt is recognized.

The Company accounted for $ 50,000 of interest rate swaps that became effective February 2017 as cash flow hedges.

In the third quarter of 2020, the Company dedesignated the cash flow hedges and accounted for the $ 50,000 interest rate swaps on a mark-to-market basis with changes in fair value recorded in current period earnings.

In connection with this dedesignation, the Company froze the balances recorded in “Accumulated other comprehensive loss” at June 30, 2020 and reclassified balances to earnings as the underlying physical transactions occurred, unless it was no longer probable that the physical transaction would occur at which time the related gains deferred in "Other Comprehensive Income" would be immediately recorded in earnings.

The gains and losses related to the interest rate swaps were reclassified from “Accumulated other comprehensive loss” in the Consolidated Balance Sheets and included in “Interest expense - net” in the Consolidated Statements of Operations as the interest expense from the Company’s debt was recognized.

These interest rate swaps expired February 2022.

For the years ended December 31, 2024 and 2023, the Company recognized interest income of $ 1,306 and $ 1,206 , respectively, from interest rate swaps.

As a result of the dedesignation of the interest rate swaps, the Company recognized interest income of $ 157 from the change in fair value of the interest rate swaps in “Interest expense - net” in the Consolidated Statements of Operations for year ended December 31, 2022.

In accordance with the provisions of ASC 820, the Company measures certain nonfinancial assets and liabilities at fair value, which are recognized and disclosed on a nonrecurring basis.

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Retirement Plans

The Company has three retirement plans that cover its hourly and salaried employees in the US:

one defined benefit plan, which is frozen, and two defined contribution plans.

The Company provides retirement plans that cover its hourly and salaried employees.

In the US, as of December 31, 2024 the Company has two defined contribution plans.

Employees are eligible to participate in the appropriate plan based on employment classification.

The Company’s contributions to the defined benefit and defined contribution plans are governed by the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the Company’s policy and investment guidelines of the applicable plan.

The Company's contributions to the defined contribution plans are governed by the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the Company’s policy and investment guidelines of the applicable plan.

The Company’s policy is to contribute at least the required minimum in accordance with the funding standards of ERISA.

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These plans are discussed in further detail below.

On May 23, 2024, the Company's Board of Directors approved the termination of the frozen L.B.

Foster Company Merged Retirement Plan (the “US DB Plan”) and the Portec Rail Products (UK) Limited Pension Scheme (the “UK DB Plan”).

At such time, the Company notified all plan participants of the Company's intentions to terminate and fully settle the obligations.

United States Defined Benefit Plan

During the fourth quarter of 2024, the Company completed the termination of the US DB Plan by distributing all the assets of its US DB Plan and by making additional cash contributions of $ 1,806 to effectuate the termination of this plan.

The settlement of these obligations resulted in the recognition of a charge of $ 1,722 which has been presented as a component of “Other expense - net” for the year ended December 31, 2024.

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The following tables present a reconciliation of the changes in the benefit obligation, the fair market value of the assets, and the funded status of the plan, as of December 31, 2024 and 2023:

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Benefit obligation at beginning of year $ 5,909 $ 6,101

Service cost — —

Interest cost 265 286

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Benefits paid ( 432 ) ( 455 )

Settlements ( 5,592 ) —

Benefit obligation at end of year $ — $ 5,909

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Benefits paid ( 432 ) ( 455 )

Reversion ( 112 )

Settlements ( 5,592 ) —

Fair value of assets at end of year — 3,923

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Net loss $ — $ 1,598

The actuarial loss included in accumulated other comprehensive loss that will be recognized in net periodic pension cost during 2024 is $ 52 , before taxes.

Net periodic pension costs for the years ended December 31, 2024 and 2023 were as follows:

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Net periodic pension cost $ 52 $ 92

Settlement charge 1,722 —

Total pension expense $ 1,774 $ 92

The weighted average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed and also the net periodic benefit cost for the following year.

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The expected long-term rate of return is based on numerous factors, including the target asset allocation for plan assets, historical rate of return, long-term inflation assumptions, and current and projected market conditions.

Amounts applicable to the Company’s pension plan with accumulated benefit obligations in excess of plan assets were as follows as of December 31, 2023 and 2022:

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Amounts applicable to the Company’s pension plan with accumulated benefit obligations in excess of plan assets were as follows as of December 31, 2023:

Projected benefit obligation $ 5,909

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The investments are limited to cash and cash equivalents, bonds, preferred stocks, and common stocks.

The investment target ranges and actual allocation of pension plan assets by major category as of December 31, 2023 and 2022 were as follows:

Target 2023 2022

The investment target ranges and actual allocation of pension plan assets by major category as of December 31, 2023 were as follows:

Asset Category

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Total mutual funds and equities 35 - 70 %

Total 100 % 100 %

In accordance with the fair value disclosure requirements of ASC 820, the following assets were measured at fair value on a recurring basis as of December 31, 2023 and 2022.

In accordance with the fair value disclosure requirements of ASC 820, the following assets were measured at fair value on a recurring basis as of December 31, 2023.

Additional information regarding ASC 820 and the fair value hierarchy can be found in Note 15.

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These investments are classified as Level 1 of the fair value hierarchy.

The Company currently anticipates contributions of $ 370 to its US defined benefit plan in 2024.

The following benefit payments are expected to be paid during the years indicated:

Year Ending December 31,

Years 2029-2033 2,105

United Kingdom Defined Benefit Plan

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The Company’s funding policy for the plan is to make minimum annual contributions required by applicable regulations.

The UK DB Plan is fully funded as of December 31, 2024.

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The funded status of the United Kingdom defined benefit plan as of December 31, 2024 and 2023 was as follows:

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Total $ ( 657 ) $ ( 496 )

The Company's UK DB Plan is fully funded as of December 31, 2024.

In January 2025, the Company entered into an insurance buy-in contract with a third party insurer which resulted in an exchange of plan assets for an annuity that covers our future projected benefit obligations.

The Company expects the buy out of the plan and transfer of future benefit obligations of plan participants to be completed in early 2026.

The Company does not expect to make any further contributions to the UK DB Plan.

Net periodic pension costs for the years ended December 31, 2024 and 2023 were as follows:

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Expected rate of return on plan assets 5.3 % 6.0 %

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Amounts applicable to the Company’s pension plans with accumulated benefit obligations in excess of plan assets were as follows as of December 31, 2024 and 2023:

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Bonds 6,206 1,693

Other 903 379

Total $ 6,345 $ 6,399

United Kingdom regulations require trustees to adopt a prudent approach to funding required contributions to defined benefit pension plans.

The Company anticipates making contributions of $ 318 to the United Kingdom defined benefit plan during 2024.

The following estimated future benefits payments are expected to be paid under the United Kingdom defined benefit plan:

Year Ending December 31,

Years 2029-2033 1,497

The UK DB Plan expects to make $ 336 of benefit payments in 2025 prior to the termination of the plan in early 2026.

Defined Contribution Plans

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In addition, the product warranty accrual is adjusted periodically based on the identification or resolution of known individual product warranty claims.

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The following table sets forth the Company’s product warranty accrual:

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Warranty liability utilized ( 483 )

Divestiture of business ( 113 )

Balance as of December 31, 2024 $ 602

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CI 15-564, in the District Court for Douglas County, Nebraska.

Under the Settlement Agreement, the Company and CXT will pay UPRR the aggregate amount of $ 50,000 without pre-judgment interest, which began with a $ 2,000 immediate payment, and with the remaining $ 48,000 paid in installments over a six-year period commencing on the effective date of the Settlement Agreement through December 2024 pursuant to a Promissory Note.

Additionally, commencing in January 2019 and through December 2024, UPRR agreed to purchase and has been purchasing from the Company and its subsidiaries and affiliates, a cumulative total amount of $ 48,000 of products and services, targeting $ 8,000 of annual purchases per year beginning March 13, 2019 per letters of intent under the Settlement Agreement.

During the third quarter of 2021, in connection with the Company’s divestiture of its Piling Products division, the targeted annual purchases per year have been reduced to $ 6,000 for 2021 through 2024.

Under the Settlement Agreement, the Company and CXT agreed to pay UPRR the aggregate amount of $ 50,000 without pre-judgment interest, which began with a $ 2,000 immediate payment, and with the remaining $ 48,000 paid in installments over a six-year period commencing on the effective date of the Settlement Agreement through December 2024 pursuant to a Promissory Note.

Additionally, commencing in January 2019 and continuing through December 2024, UPRR agreed to purchase and has been purchasing from the Company and its subsidiaries and affiliates, a cumulative total amount of $ 48,000 of products and services, targeting $ 8,000 of annual purchases per year beginning March 13, 2019 per letters of intent under the Settlement Agreement.

During the third quarter of 2021, in connection with the Company’s divestiture of its Piling Products division, the targeted annual purchases per year were reduced to $ 6,000 for 2021 through 2024.

The Settlement Agreement also includes a mutual release of all claims and liability regarding or relating to all CXT pre-stressed concrete railroad ties with no admission of liability and dismissal of the litigation with prejudice.

The expected payments under the UPRR Settlement Agreement for the year ending December 31, 2024 are $ 8,000 .

As of December 31, 2024 the UPRR Settlement Agreement has been fully paid.

The Company reclassified $ 6,600 of the previously accrued warranty reserve related to the UPRR matter into its aggregate accrued settlement liability of $ 50,000 as of December 31, 2018.

Therefore, the Company recognized $ 43,400 in expense for the year ended December 31, 2018 for the remaining amount per the Settlement Agreement, which was recorded in “Concrete Tie Settlement expense” within its Consolidated Statements of Operations.

As of December 31, 2023 and 2022, $ 8,000 and $ 8,000 was recorded within “Current portion of accrued settlement,” respectively, and $ 8,000 was recorded within “Long-term portion of accrued settlement” as of December 31, 2022, within the Consolidated Balance Sheets.

As of December 31, 2023, $ 8,000 was recorded within “Current portion of accrued settlement” within the Consolidated Balance Sheets.

Other Legal Matters

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The net present value and undiscounted costs of the selected remedy throughout the harbor site are estimated by the EPA to be approximately $ 1.1 billion and $ 1.7 billion, respectively, and the remedial work is expected to take as long as 13 years to complete.

These costs may increase given that the remedy will not be initiated or completed for several years.

Other estimates indicate that these costs may increase given that the remedy will not be initiated or completed for several years.

The Company is reviewing the basis for its identification by the EPA and the nature of the historic operations of a Company predecessor near the site.

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the Company was not a recipient of this Unilateral Administrative Order.

The Company cannot predict the ultimate impact of these proceedings because of the large number of PRPs involved throughout the harbor site, the size and extent of the site, the degree of contamination of various wastes, varying environmental impacts throughout the harbor site, the scarcity of data related to the facility once operated by the Company and a predecessor, potential comparative liability between the allocation parties and regarding non-participants, and the speculative nature of the remediation costs.

On December 2, 2024, the Company and many other PRPs received a Special Notice Letter ("SNL") from the EPA regarding a formal initiation of negotiations for the investigation and cleanup of the Portland Harbor Superfund Site and

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requesting a "good faith offer" from certain PRPs as to remediation and reimbursement of costs within 120 days, which, if accepted, would lead to a formal Consent Decree which may not be entered under the EPA's proposed schedule until fall of 2026 or by March 2027.

The deadline for a response has been extended to May 30, 2025.

The Company cannot predict the ultimate impact of these proceedings and the SNLs because of the large number of PRPs involved throughout the harbor site, the size and extent of the site, the degree of contamination of various wastes, varying environmental impacts throughout the harbor site, the scarcity of data related to the facility once operated by the Company and a predecessor, potential comparative liability between the allocation parties and regarding non-participants, and the speculative nature of the remediation costs.

Based upon information currently available, management does not believe that the Company’s alleged PRP status regarding the Portland Harbor Superfund Site or other compliance with the present environmental protection laws will have a material adverse effect on the financial condition , results of operations, cash flows, competitive position, or capital expenditures of the Company.

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Additions to environmental obligations —

Environmental reserve adjustment ( 600 )

Environmental obligations utilized ( 21 )

Balance as of December 31, 2024 $ 1,796

Other Expense (Income)

The following table summarizes the Company’s other expense (income) for the years ended December 31, 2023 and 2022:

Loss on the sale of Chemtec (a) $ 2,065 $ —

Bridge grid deck exit impact (b) 1,403 —

During the year ended December 31, 2024, the Company made an adjustment to reduce its environmental obligation by $ 600 .

This adjustment was recorded to reflect the Company's current expectations of probable environmental remediation costs based on remediation progress, prospective estimates of required activity, and historical analysis.

Other Expense

The following table summarizes the Company’s other expense - net for the years ended December 31, 2024 and 2023:

Pension termination costs (a) $ 1,722 $ —

Loss on the sale of Chemtec (b) — 2,065

Loss on the sale of Concrete Ties (c) — 1,009

Gain on Piling Products division asset sale (d) — ( 489 )

Insurance proceeds (e) ( 215 ) ( 790 )

Loss on the sale of Track Components (f) — 467

Costs recovered from environmental cleanup activities (g) — ( 325 )

Foreign currency losses 77 434

Insurance proceeds (d) ( 38 ) ( 215 )

Foreign currency (gains) losses ( 154 ) 77

Other ( 454 ) ( 301 )

Other expense (income) - net $ 3,666 $ ( 1,550 )

Other expense - net $ 1,076 $ 2,635

During the fourth quarter of 2024, the Company terminated its US DB Plan generating pension settlement costs of $ 1,722 .

On August 30, 2023, the Company announced the discontinuation of its Bridge Products grid deck product line which was reported in the Steel Products business unit within the Infrastructure segment and resulted in expense of $ 1,403 .

On June 30, 2023, the Company sold substantially all the operating assets of the Ties business, located in Spokane, WA, generating a $ 1,009 loss on the sale.

On September 27, 2021, the Company announced it completed the sale of its Piling Products division to J.D.

Fields & Company, Inc., resulting in a pre-tax gain of $ 489 in 2022.

In 2023 and 2022, the Company received $ 215 and $ 790 , respectively, in insurance proceeds.

On August 1, 2022, the Company divested the assets of its rail spikes and anchors track components business located in St-Jean-sur-Richelieu, Quebec, Canada, resulting in a pre-tax loss of $ 467 in 2022.

In 2022, the Company received $ 325 to recover costs associated with environmental cleanup activities in a formerly leased property in Magnolia, TX.

In 2024 and 2023, the Company received $ 38 and $ 215 in insurance proceeds, respectively.

Restructuring Costs

In August 2024, the Company announced an enterprise restructuring program aligned with its strategy to reduce costs and enable investment in its growth platforms.

The restructuring action has been completed as of December 31, 2024.

The following table sets forth restructuring costs by segment for the year ended December 31, 2024:

Year Ended December 31,

Rail, Technologies, and Services $ 1,134

Infrastructure Solutions 113

Corporate 209

Total $ 1,456

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The Company's $ 1,456 restructuring expense relates primarily to severance.

Of the total restructuring costs incurred for the year ended December 31, 2024, $ 245 was recorded in “Cost of goods sold” and $ 1,211 was reported in “Selling and administrative expense.” The Company does not anticipate any additional restructuring expense to be incurred associated with this program.

The following table sets forth a reconciliation of the beginning and ending restructuring liability balance through December 31, 2024 (the remaining liability is expected to be paid in 2025):

Restructuring Liability

Balance as of December 31, 2023 $ —

Restructuring costs 1,456

Cash paid ( 769 )

Balance as of December 31, 2024 $ 687

Subsequent Events

On March 3, 2025, the Company’s Board of Directors authorized the repurchase of up to $ 40,000 of the Company’s common stock in open market transactions and/or 10b5-1 trading plans through February 29, 2028.

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