What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2025-02-14 compared with 2024-02-23 · 63 added, 87 removed, 294 unchanged (34% of the section changed)

3 unchanged sentences

We deliver infrastructure solutions for public and private clients primarily in the United States.

We are one of the largest diversified construction and construction materials companies in the United States.

We are one of the largest diversified, vertically integrated civil contractors and construction materials producers in the United States.

Within the public sector, we primarily concentrate on infrastructure projects, including the construction of streets, roads, highways, mass transit facilities, airport infrastructure, bridges, dams, power-related facilities, utilities, tunnels, water well drilling and other infrastructure-related projects.

Within the private sector, we perform various services such as site preparation, mining services and infrastructure services for commercial and industrial sites, railways, residential development, energy development, as well as provide construction management professional services.

We own and lease aggregate reserves, and we own processing plants that are vertically integrated into our construction operations.

We also produce construction materials for sale to third parties.

We have vertically integrated operations across Alaska, Arizona, California, Mississippi, Nevada, Oregon, Tennessee, Utah and Washington in addition to regional civil construction home markets in Illinois, Florida and Texas.

Our Construction segment also operates national businesses within the Tunnel division, the Rail division, the Federal division, which performs civil construction across the continental United States and Guam, the Industrial & Energy division, which primarily focuses on commercial solar construction projects, and the Layne division, which performs water well drilling, rehabilitation services and mineral exploration services.

Operating Structure

7 unchanged sentences

See Note 21 of “Notes to the Consolidated Financial Statements” for additional information about our reportable segments.

In addition to reportable segments, we also review our business by operating groups.

In alphabetical order, our operating groups are as follows:

• California, which is comprised of vertically integrated businesses in home markets across the state;

• Central, which includes the vertically integrated Arizona region and regional civil construction businesses in Illinois, Florida and Texas.

The Central group also includes the Federal division which performs civil construction across the continental United States and Guam, and the Tunnel division;

• Mountain, which is comprised of vertically integrated regional businesses in Alaska, Washington, Oregon, Utah and Nevada.

The Mountain Group also includes national businesses in the Industrial & Energy division, which primarily focuses on commercial solar construction projects, Water Resources, which performs water well drilling and rehabilitation services and Mineral Services, which performs mineral exploration services for mining clients.

During the first quarter of 2024, we reorganized our operational structure to more closely align with our two reportable segments, Construction and Materials.

Previously, leaders within our three former operating groups of California, Central and Mountain managed both Construction and Materials operations within each group.

This change allows us to better leverage our expertise within each reportable segment with leadership having direct oversight of their respective segment operations.

As a result of the reorganization, we will no longer disclose financial information by operating group.

There were no material impacts to our consolidated financial statements and no changes to our reportable segments.

Customers in our Construction segment are predominantly in the public sector and include certain federal agencies, state departments of transportation, local transit authorities, county and city public works departments, school districts and developers, utilities and private owners of industrial, commercial and residential sites.

4 unchanged sentences

Revenue recognized from contracts with Caltrans during the years ended December 31, 2024, 2023 and 2022 represented $567.6 million (14.2% of total revenue), $458.2 million (13.1% of total revenue) and $348.0 million (10.5% of total revenue), respectively, which was primarily in the Construction segment.

Other than Caltrans, none of our customers, including both prime and subcontractor arrangements, had revenue that individually exceeded 10% of total revenue during the years ended December 31, 2023 and December 31, 2022.

None of our customers had revenue that individually exceeded 10% of total revenue during the year ended December 31, 2021.

Other than Caltrans, none of our customers, including both prime and

subcontractor arrangements, had revenue that individually exceeded 10% of total revenue during the years ended December 31, 2024, 2023 or 2022.

Business Strategy

Granite exists to satisfy society’s needs for mobility, power, water and other essential services that sustain living conditions and improve quality of life.

As America's Infrastructure Company (TM), Granite satisfies society’s needs for mobility, power, water and other essential services that sustain living conditions and improve quality of life.

Across our footprint of regional offices, we provide horizontal civil infrastructure construction services and construction materials products to a diverse base of public, industrial and commercial clients.

21 unchanged sentences

We also look for additional vertical integration opportunities that complement our existing construction and materials businesses.

In 2023, we strengthened and expanded our vertically integrated home markets with acquisitions of the Brunswick Canyon quarry and asphalt plant in Nevada;

Coast Mountain Resources (2020) Ltd.

("CMR"), a construction aggregate producer in British Columbia, Canada;

and Lehman-Roberts Company and Memphis Stone & Gravel Company (collectively, "LRC/MSG"), asphalt paving and asphalt and aggregate producers and suppliers operating in the Memphis metropolitan market.

We expanded our vertically integrated home markets with the 2024 acquisition of Dickerson & Bowen, Inc.

("D&B"), an aggregates, asphalt and highway construction company serving central and southern Mississippi.

Diversification:

1 unchanged sentence

(1) in both the public and private sectors;

(2) in diverse end markets such as federal, rail, power, water and renewable energy;

(2) in diverse end markets such as federal, rail, power and water;

(3) for a wide range of clients from the federal government to small municipalities and from large corporations to small private customers;

(4) in diverse geographic markets;

(5) with procurement methods that include construction management/general contractor (“CM/GC”), bid-build and design-build;

(5) with procurement methods that include construction management/general contractor (“CM/GC”), construction management at-risk (“CMAR”), progressive design-build, bid-build and design-build;

(6) that are executed according to a fixed price, time and materials, cost reimbursable and fixed unit price;

2 unchanged sentences

Our incentive compensation plans align with the key objectives outlined in our strategic plan.

Managers are incentivized with cash compensation and equity awards, payable upon the attainment of pre-established annual financial and non-financial metrics, including capital efficiency and cash flow generation.

Managers are incentivized with cash compensation and equity awards payable upon the attainment of pre-established annual financial and non-financial metrics.

Code of Conduct and Core Values:

3 unchanged sentences

Significant resources are employed to attract, develop and retain extraordinary and diverse talent and optimize each employee’s capabilities.

Our focus on inclusive diversity, talent development, talent acquisition, and succession planning has allowed us to build a bench of talented employees.

Our managerial and supervisory personnel have an average tenure of 12 years with Granite, which demonstrates our workforce's strong dedication to, and great pride in, our company.

Our focus on an inclusive work environment, talent development, talent acquisition, and succession planning has allowed us to build a bench of talented employees.

managerial and supervisory personnel have an average tenure of 12 years with Granite, which demonstrates our workforce's strong dedication to, and great pride in, our company.

On December 31, 2024, we employed approximately 2,300 salaried employees who work in project, functional and business unit management, estimating and administrative capacities, plus approximately 2,100 hourly employees.

These totals do not include employees of unconsolidated joint ventures or employees of the newly acquired LRC/MSG businesses (see Note 2 of the “Notes to the Consolidated Financial Statements”).

The total number of hourly personnel fluctuates with the volume of construction in progress and is seasonal.

These totals do not include employees of unconsolidated joint ventures.

The total number of hourly personnel fluctuates with the volume of work in progress and is seasonal.

During 2024, the number of hourly employees ranged from approximately 2,100 to 4,300.

1 unchanged sentence

As of December 31, 2024, three of our wholly-owned subsidiaries, Granite Construction Company, Layne Christensen Company and Granite Industrial, Inc., were parties to craft collective bargaining agreements in many areas in which they operate (see Note 16 of the “Notes to the Consolidated Financial Statements”).

Inclusive Diversity:

Our culture is underpinned by our core values, including an unwavering commitment to inclusive diversity as exemplified by strategies that address our guiding belief that diverse backgrounds, perspectives, and experiences enhance creativity and innovation.

We have established employee resource groups that serve employees from a variety of backgrounds, and we have designated October as Inclusion month throughout our Company.

We periodically conduct pay equity analyses to support our commitment to pay equity for similar job functions, regardless of race, gender, ethnicity or sexual orientation.

We continued to execute on our inclusive diversity five-year strategic plan, which was established in 2020, with the following key goals:

• increase representation of women throughout the organization by 2025;

• increase women in leadership by 2025;

• increase representation of minorities in leadership throughout the organization by 2025;

• increase diversity and inclusion index survey results from 71% in 2020 to 80% by 2025.

In 2023, we continued to make progress towards our 2025 goals through broadening the diversity of our pool of potential qualified applicants and identifying and addressing any impediments to employment opportunity that may exist.

Representation of women throughout the organization was maintained and representation of women and minorities in leadership increased in 2023.

Our 2022 diversity and inclusion index survey result was 74%.

Survey results represent employee responses to questions regarding our diversity and inclusion practices.

Our next survey will be completed in 2024.

We were also successful with our targeted talent acquisition plan to increase the participation of diverse colleges and universities.

In 2023, we employed 238 interns from 105 colleges and universities.

We remain fully committed to fairness and nondiscrimination in our employment practices by ensuring that the decision on who to hire and promote are based purely on merit and made without consideration of race, gender or other protected characteristic.

Health and Safety:

3 unchanged sentences

A core part of our mission will always be to provide a safe and healthy work environment for all our employees.

Our culture is underpinned by our core values, including an unwavering commitment to inclusion as exemplified by strategies that address our guiding belief that diverse backgrounds, perspectives and experiences enhance creativity and innovation.

We have established employee resource groups that serve employees from a variety of backgrounds and we periodically conduct pay analyses to support our commitment to legally-compliant pay practices for similar job functions.

We continued to execute on our five-year strategic plan regarding inclusion, which was established in 2020, working toward increased representation of women and minorities throughout the organization (including in leadership) to be reflective of the communities in which we operate.

In 2024, we continued to make progress through broadening the diversity of our pool of potential qualified applicants and identifying and addressing any impediments to employment opportunity that may exist.

We also increased the number of colleges and universities we are targeting for our pool of qualified applicants.

In 2024, we employed 241 interns from 108 colleges and universities.

Employee Development and Training:

4 unchanged sentences

We have a robust talent and succession planning process and have established specialized programs to accelerate the development of our talent pipeline for critical roles in general management, engineering, project management and operations.

On an annual basis, we conduct succession planning reviews with senior leaders focusing on our high performing and high potential talent, diverse talent and succession for critical roles.

On an annual basis, we conduct succession planning reviews with senior leaders focusing on our high performing and high potential talent and succession for critical roles.

Employee Engagement:

1 unchanged sentence

These include corporate culture assessments, as well as real-time feedback on employee engagement and on employee well-being which includes physical, emotional, social and financial health.

In 2023, we conducted a company-wide employee engagement survey and the results reflect improved engagement.

Compensation and Benefits:

3 unchanged sentences

We also offer a variety of voluntary benefits that allow employees to select the options that meet their needs.

Environmental, Social and Governance Matters

Sustainability

Sustainability is one of our core values and we are committed to contributing to the development of a more sustainable future.

We are a participating member of the United Nations Global Compact.

Our sustainability objectives encompass corporate social responsibility, environmental stewardship, dependable governance and the creation of enduring economic value.

Our sustainability objectives encompass

corporate social responsibility, environmental stewardship, dependable governance and the creation of enduring economic value.

We envision Granite as the leading provider of sustainable infrastructure solutions, differentiated by our pursuit of social, environmental and financial excellence.

To attain our objectives, we have a Sustainability department that develops, coordinates and communicates our environmental, social and governance (“ESG”) initiatives across the Company.

Our Board of Directors oversees our sustainability program, including how we manage sustainability and ESG-related risks in conjunction with our overall Enterprise Risk Management process.

To attain our objectives, we have a Sustainability department that develops, coordinates and communicates our initiatives across the Company.

Our Board of Directors oversees our sustainability program, including how we manage sustainability-related risks in conjunction with our overall Enterprise Risk Management process.

We utilize the Global Reporting Initiative and Sustainability Accounting Standards Board standards as frameworks to support performance, tracking and reporting, and responsible business behavior.

1 unchanged sentence

Within these frameworks, we have selected industry-specific metrics that align with stakeholder expectations, are relevant to our business, and will have the most significant impact.

We publish annual Sustainability Reports, which update stakeholders on our ESG performance.

We are committed to addressing the effects of climate change and currently have a priority target to reduce scope 1 greenhouse gas emissions by 25% by 2030 from a 2020 baseline.

However, achievement of our sustainability commitments and targets is subject to risks and uncertainties, many of which are outside of our control.

See “Item 1A.

Risk Factors” for additional information.

We publish annual Sustainability Reports, which update stakeholders on our performance.

Our annual sustainability reports, along with additional information about our sustainability program, can be found on our website at https://www.graniteconstruction.com/company/building-better-future-today.

19 unchanged sentences

Although the construction business is highly competitive, there are few, if any, companies which compete in all of our market areas.

The degree and type of competition is influenced by the type and scope of construction projects within the

individual markets.

The degree and type of competition is influenced by the type and scope of construction projects within the individual markets.

One of our significant competitive advantages is that we own and lease aggregate reserves and own processing plants that are vertically integrated into our construction operations.

9 unchanged sentences

By contrast, larger projects typically require larger amounts of capital that may make entry into the market by future competitors more difficult.

Also, aggregate mining and asphalt production require significant capital investment to purchase and maintain the necessary property and equipment which presents a significant barrier to entry into the construction materials market.

aggregate mining and asphalt production require significant capital investment to purchase and maintain the necessary property and equipment which presents a significant barrier to entry into the construction materials market.

See “Current Economic Environment and Outlook” under “Item 7.

16 unchanged sentences

Government contracts are subject to specific procurement regulations, contract provisions and a variety of socioeconomic requirements relating to their formation, administration, performance and accounting and often include express or implied certifications of compliance.

Our operations are subject to various statutes and executive orders including the Davis-Bacon Act (which regulates wages and benefits), the Walsh-Healy Act (which prescribes a minimum wage and regulates overtime and working conditions), Executive Order 11246 (which establishes equal employment opportunity and affirmative action requirements), Executive Order 14063 (which requires project labor agreements on federal construction projects over $35 million), the Drug-Free Workplace Act, the Federal Acquisition Regulation and the Federal Civil False Claims Act.

We are also subject to the rules and regulations promulgated by OSHA and the Mine Safety and Health Administration.

Our operations are subject to various statutes and certain executive orders, as well as the rules and regulations promulgated by the Occupational Safety and Health Administration and the Mine Safety and Health Administration.

In addition, certain of our contracts with government agencies contain minimum Disadvantaged Business Enterprise (“DBE”) participation clauses.

8 unchanged sentences

We are also subject to the applicable anti-corruption laws in the jurisdictions in which we operate, thus potentially exposing us to liability and potential penalties in multiple jurisdictions.

The anti-corruption provisions of the FCPA are enforced by the Department of Justice while other state or federal agencies may seek recourse against us for issues related

The anti-corruption provisions of the FCPA are enforced by the Department of Justice while other state or federal agencies may seek recourse against us for issues related to the FCPA.

In addition, the Securities and Exchange Commission (“SEC”) requires strict compliance with certain accounting and internal control standards set forth under the FCPA.

8 unchanged sentences

Fixed price contracts are priced on a lump-sum basis under which we bear the risk that we may not be able to perform the work for the specified contract amount and any increase in our cost over budget, whether due to inflation, inefficiency, incorrect estimates or assumptions or other factors, will reduce our profit on the project.

The percentage of fixed price contracts in our unearned revenue was 30.5% and 23.5% at December 31, 2023 and 2022, respectively.

percentage of fixed price contracts in our unearned revenue was 33.2% and 30.5% at December 31, 2024 and 2023, respectively.

All other contract types represented 7.7% and 6.0% of our unearned revenue at December 31, 2024 and 2023, respectively.

Within our Construction segment, we utilize several methods of project delivery including, but not limited to, bid-build, design-build, CM/GC, construction management at-risk (“CMAR”) and progressive design-build.

Within our Construction segment, we utilize several methods of project delivery including, but not limited to, bid-build, design-build, CM/GC, CMAR and progressive design-build.

Unlike traditional bid-build projects where owners first hire a design firm or design a project themselves and then put the project out to bid for construction, the design portion of design-build projects is typically only partially complete when going out to bid.

This project delivery method expedites the bidding process for the owner and provides the owner with a single point of responsibility and a single contact for both final design and construction.

Under the CM/GC and CMAR delivery methods, we contract with owners to assist the owner during the design phase of the contract with construction efficiencies and risk mitigation, with the understanding that we will negotiate a contract on the construction phase when the collective design nears completion.

Under the CM/GC and CMAR delivery methods, we contract with owners to assist during the design phase of the contract with construction efficiencies and risk mitigation, with the understanding that we will negotiate a contract on the construction phase when the collective design nears completion.

The progressive design-build delivery method is similar to CM/GC and CMAR;

33 unchanged sentences

Thus, we may be subject to increased costs associated with the failure of one or more subcontractors to perform as anticipated.

Based on our analysis of their construction and financial capabilities, among other criteria, we may require the subcontractor to furnish a bond or other type of security to guarantee their performance and/or we retain payments, or some portion thereof, in accordance with contract terms until their performance is complete.

DBE regulations require us to use our good faith efforts to subcontract a specified portion of contract work done for governmental agencies to certain types of disadvantaged contractors or suppliers.

Based on our analysis of their construction and financial capabilities, among other criteria, we may require the subcontractor to furnish a bond or other

type of security to guarantee their performance and/or we retain payments, or some portion thereof, in accordance with contract terms until their performance is complete.

DBE regulations may require us to use our good faith efforts to subcontract a specified portion of contract work done for governmental agencies to certain types of disadvantaged contractors or suppliers.

As with all of our subcontractors, some may not be able to obtain surety bonds or other types of performance security.

3 unchanged sentences

Generally, each construction joint venture is formed as a partnership or limited liability company to accomplish a specific project and is jointly controlled by the joint venture partners.

We select our joint venture partners (“partner(s)”) based on our analysis of their construction and financial capabilities, expertise in the type of work to be performed and past working relationships, among other criteria.

We select our joint venture partners based on our analysis of their construction and financial capabilities, expertise in the type of work to be performed and past working relationships, among other criteria.

Under each joint venture agreement, one partner is designated as the sponsor.

20 unchanged sentences

These costs could be offset by billings to the customer or by proceeds from our partners’ corporate and/or other guarantees.

At December 31, 2023, there was $195.6 million of remaining contract value on unconsolidated and line item construction joint venture contracts, of which $93.1 million represented our share and is included in our CAP and the remaining $102.5 million represented our partners’ share.

At December 31, 2024, there was $100.6 million of remaining contract value on unconsolidated and line item construction joint venture contracts, of which $35.6 million represented our share and is included in our CAP and the remaining $65.0

million represented our partners’ share.

See Note 9 of “Notes to the Consolidated Financial Statements” for more information.

16 unchanged sentences

In recent years, inflation, supply chain and labor constraints have had a significant impact on the global economy including the construction industry in the United States.

While it is impossible to fully eliminate the impact of these factors, we have applied proactive measures such as fixed forward purchase contracts of oil related inputs, energy surcharges, and adjustment of project schedules for constraints related to construction materials such as concrete.

While it is impossible to fully eliminate the impact of these factors, where practicable, we have applied proactive measures such as fixed forward purchase contracts of oil related inputs, energy surcharges, and adjustment of project schedules for constraints related to construction materials such as concrete.

At December 31, 2024 and 2023, we owned the following number of construction equipment and vehicles:

6 unchanged sentences

We lease or rent equipment to supplement our portfolio of equipment in response to construction activity cycles.

The December 31, 2023 equipment count includes 202 pieces of heavy construction equipment and 111 vehicles from the LRC/MSG acquisition.

The December 31, 2024 equipment count includes 189 pieces of heavy construction equipment and 206 vehicles from the D&B acquisition.

In 2024 and 2023, we purchased $59.2 million and $71.9 million, respectively, of construction equipment and vehicles.

9 unchanged sentences

Larkin 53 President and Chief Executive Officer

Curtis 57 Executive Vice President and Chief Financial Officer

Woolsey 48 Executive Vice President and Chief Financial Officer

Radich 66 Executive Vice President and Chief Operating Officer

3 unchanged sentences

Williams 64 Senior Vice President, Construction

Woolsey 47 Chief Accounting Officer

Larkin joined Granite in 1996, has served as President since September 2020 and as Chief Executive Officer since June 2021.

6 unchanged sentences

from the University of Massachusetts, Amherst.

Curtis joined Granite in 2018 and has served as Executive Vice President and Chief Financial Officer since January 2021.

She also served as Chief Accounting Officer from October 2020 to January 2021, Vice President of Investor Relations from 2019 to October 2020, and Vice President and Integration Management Officer from 2018 to 2019.

Before joining Granite, Ms.

Curtis served as Vice President and Chief Accounting Officer for Layne Christensen Company (“Layne”) from 2016 to 2018.

Prior to joining Layne, Ms.

Curtis worked for Cameron from 2009 to 2016 serving in positions of increasing responsibility and ultimately as their Controller, in charge of external reporting, accounting policies, and internal controls from 2015 to 2016.

Curtis began her career in public accounting with Deloitte and graduated from Texas A&M University with B.S.

degrees in Accounting and Finance and is a Certified Public Accountant.

Woolsey joined Granite in June 2021 and has served as Executive Vice President and Chief Financial Officer since September 2024.

Woolsey also served as Chief Accounting Officer from January 2022 to September 2024 and served in a non-officer role with accounting responsibilities since joining the Company in June 2021.

Prior to joining the Company, Ms.

Woolsey was the Vice President and Corporate Controller from December 2018 to August 2020 and Vice President, Corporate Controller and Chief Accounting Officer from August 2020 to June 2021 of MDC Holdings, Inc.

From February 2016 to December 2018, Ms.

Woolsey was the Vice President and Controller of the Energy, Infrastructure and Industrial Construction division of AECOM.

Woolsey received a B.S.

degree in Accounting from the University of Idaho and is a Certified Public Accountant.

Radich first joined Granite in 1980 and rejoined the Company in 2011.

3 unchanged sentences

Radich was employed by Oldcastle Materials.

Radich served Granite as Project Engineer from 1980 to 1983, Project Manager from 1985 to 1990 for the Heavy Civil and

Vertical Divisions and Chief Estimator from 1990 to 1993 in the Vertical Division.

Radich served Granite as Project Engineer from 1980 to 1983, Project Manager from 1985 to 1990 for the Heavy Civil and Vertical Divisions and Chief Estimator from 1990 to 1993 in the Vertical Division.

He received a B.S.C.E.

8 unchanged sentences

Tatusko joined Granite in 1991 and has served as Senior Vice President, Construction since January 2024.

He also served as Senior Vice President and Group Manager from January 2020 to January 2024, Vice President and Valley Region Manager from 2014 to 2019, Northern California Area Manager from 2012 to 2014, Design Build Project Executive from 2010 to 2012, Group Construction Manager from 2007 to 2010, Arizona Operations Manager from 2005 to 2007, Arizona Construction Manager from 2001 to 2005, Plants Manager from 1999 to 2001, Estimator/Project Manager from 1995 to 1999 and Project Engineer from 1993 to 1995.

2010 to 2012, Group Construction Manager from 2007 to 2010, Arizona Operations Manager from 2005 to 2007, Arizona Construction Manager from 2001 to 2005, Plants Manager from 1999 to 2001, Estimator/Project Manager from 1995 to 1999 and Project Engineer from 1993 to 1995.

Prior to joining Granite, he was employed at Oldcastle Tilcon from 1984 to 1991.

4 unchanged sentences

in Civil Engineering from Ohio Northern University.

Woolsey joined Granite in June 2021 and was appointed Chief Accounting Officer on January 1, 2022.

Prior to this appointment and since joining the Company in June 2021, Ms.

Woolsey served in a non-officer role with accounting responsibilities and reported directly to Ms.

Prior to joining the Company, Ms.

From February 2016 to December 2018, Ms.

Woolsey was the Vice President and Controller of the Energy, Infrastructure and Industrial Construction division of AECOM.

Woolsey received a B.S.

degree in Accounting from the University of Idaho and is a Certified Public Accountant.

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

What changed 10-K

Item 1. Business