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Item 7. Management’s Discussion and Analysis

2026-02-13 compared with 2025-02-14 · 130 added, 81 removed, 239 unchanged (47% of the section changed)

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

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

Our Construction segment also operates national businesses within the Tunnel division and 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.

Our reportable segments are the same as our operating segments and correspond with how our chief operating decision maker, or decision-making group (our “CODM”), regularly reviews financial information to allocate resources and assess performance.

We identified our CODM as our Chief Executive Officer and our Chief Operating Officer.

We previously identified our CODM as our Chief Executive Officer (“CEO”) and our Chief Operating Officer (“COO”).

Following our COO's retirement on July 4, 2025, our CEO assumed sole responsibility as the CODM.

Our reportable segments are:

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The Construction segment focuses on construction and rehabilitation of roads, pavement preservation, bridges, rail lines, airports, marine ports, dams, reservoirs, aqueducts, infrastructure and site development for use by the general public and water-related construction for municipal agencies, commercial water suppliers, industrial facilities and energy companies.

It also provides construction of various complex projects including infrastructure / site development, mining, public safety, tunnel, solar, battery storage and other power-related projects.

The Materials segment focuses on production of aggregates, asphalt concrete, liquid asphalt and recycled materials production for internal use in our construction projects and for sale to third parties.

It also provides construction of various complex projects including infrastructure and site development, mining, public safety, tunnel, solar, battery storage and other power-related projects.

The Materials segment focuses on production and delivery of aggregates, asphalt concrete, liquid asphalt and recycled materials for internal use in our construction projects and for sale to third parties.

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

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.

The five primary economic drivers of our business are (i) the overall health of the U.S.

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Conversely, increased levels of public funding as well as an expanding or robust economy will generally increase demand for our services and products and provide opportunities for revenue growth and margin improvement.

Critical Accounting Estimate

Critical Accounting Estimates

The financial statements included in “Item 8.

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however, actual amounts could differ from those estimates.

We consider revenue recognition a critical accounting estimate.

It involves significant management judgment and can significantly affect our reported results of operations.

The following are our most critical accounting estimates that involve management judgment and can have significant effects on our reported results of operations.

Revenue Recognition

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The accuracy of our revenue and profit recognition in a given period depends on the accuracy of our estimates of the forecasted revenue and cost to complete each project.

Cost estimates for all of our significant projects use a detailed “bottom up”

Cost estimates for all of our significant projects use a detailed “bottom up” approach.

There are a number of factors that can contribute to changes in estimates of contract cost and profitability.

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However, Note 3 of “Notes to the Consolidated Financial Statements” presents the impact material revisions in estimates had on the periods covered by this report.

Fair Value Measurement – Acquired Mineral Reserves

In 2025, we acquired businesses that included aggregates quarries with significant mineral reserves (See Note 2 of “Notes to the Consolidated Financial Statements”).

We accounted for these transactions in accordance with ASC Topic 805, Business Combinations (“ASC 805”), and the preliminary purchase prices were allocated to assets acquired and liabilities assumed based on their estimated fair values as of the respective acquisition dates.

This determination of fair value requires us to make estimates and use valuation techniques when a market value is not readily available.

We estimate the fair value of acquired mineral reserves using discounted cash flow models which involve significant assumptions such as the forecasted revenues, projected earnings before interest, taxes, depreciation and amortization (“EBITDA”) margins, and a discount rate.

In determining the amount of reserves acquired, evaluations were completed by or under the supervision of qualified person(s) using industry best practices.

See “Quarry Properties” under “Item 2.

Properties,” for information on our reserves and methodology for estimating aggregate mineral resources and reserves.

There are inherent uncertainties related to each of the above listed assumptions, and our judgment in applying them.

These assumptions and estimates may change significantly in the future and could result in material impairment charges.

Such changes could have a material adverse effect on our financial position and results of operations.

With all other factors remaining constant, a 0.5% decrease in the discount rate would cause a $19.5 million increase in the value of the acquired mineral reserves, while a 0.5% increase in the discount rate would cause a $17.6 million decrease in the value of the acquired mineral reserves.

With all other factors remaining constant, a 1.0% change in the projected EBITDA margins would cause a $3.8 million increase or decrease in the value of the mineral reserves.

Current Economic Environment and Outlook

Funding for our public work projects, which account for approximately 85% of our portfolio, is dependent on federal, state, regional and local revenues.

At the federal level, the continued rollout of the $1.2 trillion Infrastructure Investment and Jobs Act (“IIJA”) has increased federal highway, bridge and transit funding to its highest level in more than six decades with $550 billion in incremental funding over five years.

The increased multi-year spending commitment has improved the programming visibility for state and local governments and has driven an increase in project lettings that started in 2023, continued in 2024 and we believe will carry into 2025 and beyond.

At the federal level, the $1.2 trillion Infrastructure Investment and Jobs Act (“IIJA”) has increased federal highway, bridge and transit funding to its highest level in more than six decades with $550 billion in incremental funding over five years.

The increased multi-year spending commitment improved the programming visibility for state and local governments and drove an increase in project lettings that started in 2023, and continued through 2025.

With the IIJA ending in September of 2026, discussions have begun in Congress concerning a replacement bill.

At state, regional and local levels, voter-approved state and local transportation measures continue to support infrastructure spending.

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In California, our top revenue-generating state, despite overall budgetary concerns, a significant part of the state infrastructure spend is funded through Senate Bill 1 (SB-1), the Road Repair and Accountability Act of 2017, a 10-year, $54.2 billion program, which may only be used for transportation-related purposes, without any sunset provisions.

Over the last several 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, 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.

While we actively work to mitigate the impacts of oil price inflation, further price increases may adversely impact us in the future.

Our Committed and Awarded Projects (“CAP”) balance continues to be strong at $5.3 billion at the end of the fourth quarter of 2024.

Our CAP is supported by a positive public funding environment and resilient private market which we believe will provide further opportunities for continued CAP growth in 2025.

Over the last several years, inflation, supply chain and labor constraints have had a significant impact on the global economy including Granite and others in the construction industry in the United States.

Recently, concerns over tariffs have been a major source of uncertainty in the economy.

To date, we have not experienced a material financial impact due to tariffs.

It is impossible to fully mitigate the potential impacts of the foregoing macro-economic factors and they may negatively impact us in the future.

However, where practicable, we have applied proactive measures to mitigate these macro-economic factors, 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.

Our Committed and Awarded Projects (“CAP”) balance continues to be strong with $7.0 billion at the end of the fourth quarter of 2025.

Our CAP is supported by a positive public funding environment and strength in the private markets we serve, which we believe will provide further opportunities for continued CAP growth in 2026.

On October 3, 2025, we completed the acquisition of Cinderlite Trucking Corporation and related assets (“Cinderlite”) for $58.5 million in cash, subject to customary closing adjustments.

We purchased all of the outstanding equity interest of Cinderlite, which is a construction materials, landscape supply, and transportation company in Carson City, Nevada.

This acquisition aligns with our strategy of enhancing our vertical integration by strengthening our existing home markets.

Warren Paving

On August 5, 2025, we completed the acquisition of Slats Lucas, LLC and Warren Paving, Inc.

(collectively, “Warren Paving”) for $540.0 million in cash, subject to customary closing adjustments.

Warren Paving is a vertically-integrated asphalt contractor and aggregate producer with operations along the Gulf Coast and Mississippi River.

This acquisition aligns with our strategy to expand our presence into new geographies with future growth opportunities while supporting our existing operations, particularly the Materials segment.

Papich Construction

On August 5, 2025, we completed the acquisition of Papich Construction Company, Inc.

(“Papich Construction”) for $170.0 million in cash, subject to customary closing adjustments.

Papich Construction is a provider of construction services and materials in California’s Central Coast and Central Valley regions.

This acquisition aligns with our strategy of enhancing our vertical integration by strengthening our existing home markets.

Dickerson & Bowen, Inc.

On August 9, 2024, we acquired Dickerson & Bowen, Inc.

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

On November 30, 2023, we acquired Lehman-Roberts Company and Memphis Stone & Gravel Company (collectively, "LRC/MSG").

LRC/MSG operates strategically located asphalt plants and sand and gravel mines serving the greater Memphis area and northern Mississippi.

On April 24, 2023, we acquired Coast Mountain Resources (2020) Ltd.

which changed its name to Granite Infrastructure Canada, Ltd.

("Granite Canada") on May 13, 2024.

Granite Canada is a construction aggregate producer based in British Columbia, Canada operating on Malahat First Nation land.

The results of operations of these businesses are included in our consolidated financial statements from the dates of acquisition which impacts comparability to the applicable prior periods.

See Note 1 and Note 2 of “Notes to the Consolidated Financial Statements” for further information.

2025 Acquisition Financing

On August 5, 2025, we entered into the Fifth Amended and Restated Credit Agreement (the “Credit Agreement”), which provided for (1) a $600.0 million senior secured revolving credit facility (the “Revolver”), (2) a $600.0 million senior secured term loan (the “Initial Term Loan”) and (3) an additional $75.0 million senior secured term loan (“Delayed Draw Term Loan”).

The Warren Paving, Papich Construction and Cinderlite acquisitions were funded with proceeds from the Initial Term Loan, the Delayed Draw Term Loan, a $10.0 million draw on our Revolver and from cash on hand.

The $10.0 million Revolver draw was repaid during the third quarter and the $75.0 million Delayed Draw Term Loan was repaid on October 31, 2025.

See Note 1 and Note 2 of “Notes to the Consolidated Financial Statements” for further information about the above acquisitions and Note 14 of “Notes to the Consolidated Financial Statements” for further information about the debt transactions.

Results of Operations

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Total $ 3,654,880 100.0 % $ 3,415,225 100.0 % $ 2,992,254 100.0 %

Construction revenue in 2024 increased by $423.0 million, or 14.1%, compared to 2023, primarily due to a higher level of CAP to start the year, more favorable weather conditions early in 2024 and increased revenue from acquired businesses of $114.7 million due to the timing of the acquisition of LRC/MSG in 2023 and the acquisition of D&B in 2024.

Construction revenue in 2025 increased by $239.7 million, or 7.0%, compared to 2024.

This increase was primarily driven by $112.1 million of construction revenue from our recently acquired businesses, Warren Paving and Papich Construction, during 2025.

Additionally, D&B construction revenue increased $23.6 million year-over-year.

Our remaining Construction revenue increased year-over-year driven primarily by higher CAP entering the year.

Materials Revenue

Materials revenue in 2024 increased by $75.5 million, or 14.6%, when compared to 2023, driven primarily by increases in revenue from newly acquired businesses of $66.9 million, in addition to higher asphalt and aggregate sales prices.

Years Ended December 31, 2025 2024 2023

(dollars in thousands)

Aggregates $ 308,781 40.1 % $ 196,232 33.1 % $ 176,564 34.2 %

Asphalt 458,836 59.7 395,798 66.8 339,608 65.7

Other $ 1,882 0.2 % $ 319 0.1 % $ 712 0.1 %

Total $ 769,499 100.0 % $ 592,349 100.0 % $ 516,884 100.0 %

Materials revenue in 2025 increased by $177.2 million, or 29.9%, when compared to 2024.

This increase was primarily driven by materials revenue from our recently acquired businesses, Warren Paving, Papich Construction and Cinderlite, of $106.4 million during 2025.

Additionally, materials revenue increased due to higher sales volumes and prices in both aggregates and asphalt.

Committed and Awarded Projects

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Total $ 6,969,372 100.0 % $ 5,296,067 100.0 %

CAP of $5.3 billion at December 31, 2024 was $0.2 billion, or 5% lower than December 31, 2023 due to higher revenue in 2024 and lower additions to CAP in 2024.

Bidding activity remained robust in 2024, and several significant project awards are expected to be added to CAP during the first half of 2025.

The most significant additions to CAP during 2024 included $196 million for six highway projects in California, $180 million for a pumping station project in Nevada, $158 million of Federal work in Guam and $114 million for a bridge project in Michigan.

CAP of $7.0 billion at December 31, 2025 was $1.7 billion, or 32%, higher than December 31, 2024.

The most significant additions to CAP during 2025 included $494 million for a highway project in Nevada, $350 million for a drainage improvement project in Illinois, $327 million for two federal projects, $232 million for a water infrastructure project in Nevada, and $225 million for a tunnel project in Kentucky, all of which are for customers in the public sector.

Non-controlling partners’ share of CAP as of December 31, 2025 and 2024 was $361.4 million and $331.1 million, respectively.

At December 31, 2024 and 2023, one and six contracts with remaining CAP of $10.0 million or more per project had total forecasted losses with remaining revenue of $64.4 million, or 1.2% of total CAP, and $188.9 million, or 3.4% of total CAP, respectively.

At December 31, 2025 and 2024, one contract with remaining CAP of $10.0 million or more per project had total forecasted losses with remaining revenue of $25.6 million, or 0.4% of total CAP, and $64.4 million, or 1.2% of total CAP, respectively.

Provisions are recognized in the consolidated statements of operations for the full amount of estimated losses on uncompleted contracts whenever evidence indicates that the estimated total cost of a contract exceeds its estimated total revenue.

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Percent of total revenue 16.1 % 14.3 % 11.3 %

Construction gross profit for the year ended December 31, 2024 increased by $165.9 million, or 51.1%, when compared to 2023, primarily due to higher revenue and improved project execution across our project portfolio resulting in net increases from revisions in estimates in the current period compared to net decreases in the prior period.

For further discussion of projects with revisions in estimates which individually had an impact of $ 5.0 million or more on gross profit, see Note 3 of "Notes to the Consolidated Financial Statements." Additionally, gross profit from acquired businesses increased by $11.5 million for the year ended December 31, 2024, including $8.1 million of purchase accounting related depreciation and intangible asset amortization.

Materials gross profit for the year ended December 31, 2024 increased by $10.4 million, or 14.5%, when compared to 2023 and gross profit margin remained consistent at 13.8%.

The improvement in gross profit was primarily due to the results of acquired businesses as well as higher revenue.

Materials gross profit from acquired businesses increased by $7.8 million

for the year ended December 31, 2024, including $4.1 million of purchase accounting related depreciation and intangible asset amortization.

Construction gross profit for the year ended December 31, 2025 increased by $83.2 million, or 16.9%, when compared to 2024, primarily due to higher revenue and improved project execution across our project portfolio.

We also recognized more net increases from revisions in estimates due to claim settlements than in the prior year.

For further discussion of projects with revisions in estimates which individually had an impact of $5.0 million or more on gross profit, see Note 3 of “Notes to the Consolidated Financial Statements.” Additionally, construction gross profit from our recently acquired businesses, Warren Paving and Papich Construction, was $11.8 million for the year ended December 31, 2025, including an immaterial amount of purchase accounting-related charges, such as step-up depreciation and intangible asset amortization.

See Note 2 of “Notes to the Consolidated Financial Statements” for further information about acquisitions.

Materials gross profit for the year ended December 31, 2025 increased by $55.3 million, or 67.7%, when compared to 2024 and gross profit margin increased to 17.8%.

The improvement in gross profit was primarily driven by higher volumes and sales prices in both aggregates and asphalt.

The increase was also driven by gross profit from our recently acquired businesses, Warren Paving, Papich Construction, and Cinderlite, of $14.8 million for 2025, which included $7.2 million of purchase accounting-related charges such as step-up depreciation and intangible asset amortization.

See Note 2 of “Notes to the Consolidated Financial Statements” for further information about acquisitions.

Selling, General and Administrative Expenses

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As projects are completed or the volume of work slows down, we temporarily redeploy project employees to bid on new projects, moving their salaries and related costs from cost of revenue to selling expenses.

SG&A expenses for 2024 increased $39.7 million compared to 2023, primarily due to a $17.0 million increase in SG&A expenses from acquired businesses, including $6.3 million of purchase accounting related depreciation and intangible asset amortization.

The remaining increase was due to higher stock-based compensation and incentive compensation due to improved financial performance, as well as higher salaries and related expenses due to increased labor costs.

SG&A expenses for 2025 increased $73.4 million compared to 2024, primarily due to $40.4 million of higher salaries and related expenses due to increased labor costs, as well as $26.2 million of increased incentive and stock-based compensation due to improved financial performance.

Of the total increases, SG&A expenses from acquired businesses increased $11.6 million, including $3.3 million of purchase accounting related depreciation and intangible asset amortization.

Other Costs, net

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Other costs, net $ 41,416 $ 39,936 $ 50,217

Other costs for the year ended December 31, 2024 decreased by $10.3 million when compared to 2023 primarily due to a $20.0 million litigation charge in the prior year that did not recur in the current year, partially offset by an increase in costs in the current year associated with the defense of a former Company officer in his ongoing civil litigation with the Securities and Exchange Commission.

Other costs, net mainly consist of acquisition and integration costs and legal costs related to the defense of a former Company officer in his civil litigation with the SEC.

Other Costs, net increased by $1.5 million when compared to 2024 primarily due to increased acquisition and integration costs in the current year, partially offset by lower costs associated with the defense of the former Company officer.

The SEC and the Company's former officer reached an agreement in January 2026 that resolved the litigation.

As a result, we do not expect to incur any further material costs related to this matter.

See Note 2 of “Notes to the Consolidated Financial Statements” for further information about acquisitions.

Gain on Sales of Property and Equipment, net

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Gain on sales of property and equipment, net $ (20,207) $ (8,764) $ (28,346)

Gain on sales of property and equipment, net for the year ended December 31, 2024 decreased by $19.6 million when compared to 2023 primarily due to the sale of a property in Texas in 2023.

Gain on sales of property and equipment, net for the year ended December 31, 2025 increased by $11.4 million when compared to 2024 primarily due to the sale of a property in Utah in 2025.

Other (Income) Expense

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Equity in income of affiliates, net (14,958) (16,982) (25,748)

Other (income) expense, net (4,238) (6,020) 1,039

Other income, net (11,768) (4,238) (6,020)

Total other (income) expense, net $ (6,381) $ 11,171 $ 20,208

During 2024, we repurchased approximately $ 30.2 million in aggregate principal amount of our 2.75% Convertible Notes and incurred a $27.6 million loss on debt extinguishment, which was $23.5 million less than the 2023 extinguishment charge.

During 2024, interest expense, net of interest income, increased $3.9 million, as a result of increased borrowings, partially offset by higher interest income due to higher cash balances.

Equity in income of affiliates, net decreased by $8.8 million when compared to 2023 primarily due to lower net income of our affiliates.

During 2025, total other (income) expense, net improved $17.6 million primarily due to the $27.6 million loss on debt extinguishment not recurring in the current year.

This was partially offset by $15.5 million of increased interest expense, net of interest income, due to borrowings under the the Initial Term Loan and Delayed Draw Term Loan in 2025.

The following table presents the provision for income taxes for the respective periods:

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Effective tax rate 23.7 % 28.4 % 50.6 %

Our effective tax rate decreased from 50.6% to 28.4% when compared to 2023 primarily due to a decrease in nondeductible debt extinguishment costs along with a favorable adjustment for non-controlling interest in the current year.

Our effective tax rate decreased from 28.4% to 23.7% when compared to 2024 primarily due to a decrease in nondeductible debt extinguishment costs.

Amount Attributable to Non-controlling Interests

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The amount attributable to non-controlling interests represents the non-controlling owners’ share of the net (income) loss of our consolidated construction joint ventures.

The increase during 2024 was primarily due to the impact of less negative revisions in estimates related to consolidated construction joint ventures (see Note 3 of “Notes to the Consolidated Financial Statements”).

The increase during 2025 was primarily due to improved profitability on joint venture projects as well as the impact of net increases from revisions in estimates related to consolidated construction joint ventures (see Note 3 of “Notes to the Consolidated Financial Statements”).

Prior Years Comparison (2024 to 2023)

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Liquidity and Capital Resources

Our primary sources of liquidity are cash and cash equivalents, investments, available borrowing capacity under our credit facility and cash generated from operations.

Our primary sources of liquidity are cash and cash equivalents, investments, available borrowing capacity under our Credit Agreement and cash generated from operations.

We may also from time to time issue and sell equity, debt or hybrid securities or engage in other capital markets transactions or sell one or more business units or assets.

See Note 14 of the "Notes to the Consolidated Financial Statements" for information on our long-term debt.

See Note 14 of the “Notes to the Consolidated Financial Statements” for information on our debt.

Our material cash requirements include paying the costs and expenses associated with our operations, servicing outstanding indebtedness, making capital expenditures and paying dividends on our capital stock.

We may also from time to time prepay or repurchase outstanding indebtedness, repurchase shares of our common stock or acquire assets or businesses that are complementary to our operations.

See Note 2 and Note 17 of the "Notes to the Consolidated Financial Statements" for information on our acquisitions and share repurchases, respectively.

See Note 2 and Note 17 of the “Notes to the Consolidated Financial Statements” for information on our recent acquisitions and share repurchases, respectively.

Our primary contractual obligations are as follows and are further discussed in the referenced “Notes to the Consolidated Financial Statements:”

• Asset retirement obligations - see Note 11, Property and Equipment, net

• Long-term debt and the associated interest payments – see Note 14, Long-Term Debt

• Debt and the associated interest payments – see Note 14, Debt

• Operating lease and royalty future minimum payments – see Note 15, Leases

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In addition to the obligations referenced above, as of December 31, 2025 we had $11.6 million of purchase commitments for equipment and other goods and services not directly connected with our construction contracts, which are individually greater than $50,000 and have an expected fulfillment date after December 31, 2025.

Of this, approximately $15.0 million, $1.0 million and $0.4 million will be paid in 2025, 2026 and 2027, respectively.

Of this, approximately $10.0 million and $1.6 million will be paid in 2026 and 2027, respectively.

There are no material purchase commitments in the periods thereafter.

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However, there can be no assurance that sufficient capital will continue to be available or that it will be available on terms acceptable to us.

Cash, cash equivalents and marketable securities as of December 31, 2024 increased $132.1 million to $585.6 million from the prior year end.

In addition to meeting our liquidity requirements listed above, our increased cash balances are expected to be used to invest in our business through strategic capital expenditures in 2025 and we will continue to explore acquisition opportunities in alignment with our strategic plan.

As of December 31, 2024, our cash and cash equivalents consisted of deposits and money market funds held with established national financial institutions and marketable securities consisting primarily of U.S.

As of December 31, 2025, our cash and cash equivalents consisted of deposits and money market funds held with established national financial institutions and marketable securities consisting of commercial paper, corporate notes and bonds, Municipal notes and bonds and U.S.

Government and agency obligations.

As of December 31, 2024, the total unused availability under our Credit Agreement was $333.7 million, resulting from $16.3 million in issued and outstanding letters of credit and nothing drawn on the Revolver.

On August 5, 2025, we entered into the Credit Agreement, which provides for (1) a $600.0 million Revolver, (2) a $600.0 million Initial Term Loan and (3) an additional $75.0 million Delayed Draw Term Loan.

On October 3, 2025, we drew the additional $75.0 million Delayed Draw Term Loan, all of which was repaid during 2025.

As of December 31, 2025, the $600.0 million Initial Term Loan was outstanding and the total unused availability under our Revolver was $583.2 million, resulting from $16.8 million in issued and outstanding letters of credit and nothing drawn on the Revolver.

See Note 14 of “Notes to the Consolidated Financial Statements.”

As of December 31, 2024, we had $1.3 million of receivables and $29.2 million of contract retention receivables from Brightline Trains Florida LLC ("Brightline") (see Note 6 of “Notes to the Consolidated Financial Statements”), all of which has been collected as of the date of this report.

As of December 31, 2025, one of the conditions permitting the holders of the 3.25% Convertible Notes to convert was met.

Our common stock traded above 130% of the $77.88 conversion price for at least 20 trading days during the period of 30 consecutive trading days ending on December 31, 2025 (the last trading day of the calendar quarter).

The holders of the 3.25% Convertible Notes have the right to convert through March 31, 2026, at which point we will re-evaluate whether the 3.25% Convertible Notes will continue to be convertible in the subsequent calendar quarter.

In the event the holders of the 3.25% Convertible Notes elect to convert a portion, or all of their 3.25% Convertible Notes, the principal amount is required to be settled in cash.

As a result, the $373.8 million principal amount has been classified as a current liability as of December 31, 2025 in the consolidated balance sheet.

Any conversion premium will be satisfied with cash, shares of our common stock or a combination of cash and shares of our common stock, at our election.

At current market prices of our common stock, we do not expect holders to elect to convert their notes as the trading price of the notes in the secondary market exceeds the value a holder would receive upon conversion of such notes.

In the unlikely event a holder elects to convert, we would use cash on hand or draw on our Revolver as needed.

In evaluating our liquidity position and needs, we also consider cash and cash equivalents held by our consolidated construction joint ventures (“CCJVs”).

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Short-term marketable securities (2) 71,021 7,311

Long-term marketable securities (2) $ 49,534 $ —

Total cash, cash equivalents and marketable securities $ 649,775 $ 585,641

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The decision to distribute joint venture assets must generally be made jointly by a majority of the members and, accordingly, these assets, including those associated with estimated cost recovery of customer affirmative claims and back charge claims, are generally not available for the working capital needs of Granite until distributed.

(2) All marketable securities were classified as held-to-maturity and consisted of U.S.

Government and agency obligations as of all periods presented.

(2) All marketable securities were classified as held-to-maturity and consisted of commercial paper, corporate notes and bonds, Municipal notes and bonds and U.S.

Government and agency obligations as of December 31, 2025 and U.S.

Government and agency obligations as of December 31, 2024.

Granite’s portion of CCJV cash and cash equivalents was $90.6 million and $106.0 million as of December 31, 2025 and 2024, respectively.

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The timing and amount of such expenditures can vary based on the progress of planned capital projects, the type and size of construction projects, changes in business outlook and other factors.

During the year ended December 31, 2024, we had capital expenditures of $136.4 million, compared to $140.4 million during 2023, a decrease of $4.0 million.

During the year ended December 31, 2025, we had capital expenditures of $138.3 million, compared to $136.4 million during 2024, a increase of $1.9 million.

We currently anticipate 2026 capital expenditures to be between approximately $140 million and $160 million, including approximately $50 million in planned strategic materials investments.

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As a large infrastructure contractor and construction materials producer, our revenue, gross profit and the resulting operating cash flows can differ significantly from period to period due to a variety of factors, including project progression toward completion, outstanding contract change orders and affirmative claims, and the payment terms of our contracts.

Additionally, operating cash flows are impacted by the timing related to funding construction joint ventures and the resolution of uncertainties inherent in the complex nature of the construction work we perform, including claim and back charge settlements.

Additionally, operating cash flows are impacted by the resolution of uncertainties inherent in the complex nature of the construction work we perform, including claim and back charge settlements.

Our working capital assets result from both public and private sector projects.

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Cash provided by operating activities of $468.9 million during 2025 represents a $12.6 million increase in cash provided by operating activities when compared to 2024.

The change was primarily attributable to a $132.8 million increase in net income after adjusting for non-cash items and a $121.7 million increase in cash provided by working capital, which includes receivables, net contract assets, inventories, other assets, accounts payable and accrued expenses and other liabilities.

Additionally, distributions from, net of contributions to, unconsolidated construction joint ventures and affiliates increased $18.1 million from 2023.

The change was primarily attributable to a $93.0 million increase in net income after adjusting for non-cash items.

This was partially offset by a $57.4 million decrease in cash provided by working capital, which includes receivables, net contract assets, inventories, other assets, accounts payable and accrued expenses and other liabilities.

Additionally, distributions from, net of contributions to, unconsolidated construction joint ventures and affiliates decreased $23.0 million from 2024.

Investing activities

Cash used in investing activities of $228.6 million during 2024 represents a $130.7 million decrease in cash used in investing activities when compared to 2023.

The change was primarily due to a $159.7 million decrease in cash used related to business acquisitions (see Note 3 of "Notes to the Consolidated Financial Statements"), partially offset by a $24.3 million decrease in proceeds from sales of property and equipment.

Cash used in investing activities of $993.7 million during 2025 represents a $765.2 million increase in cash used in investing activities when compared to 2024.

The change was primarily due to a $643.2 million increase in cash used related to business acquisitions (see Note 3 of “Notes to the Consolidated Financial Statements”) along with an increase of $140.2 million in cash used in purchases of marketable securities, net of maturities.

This increase was slightly offset by a $19.0 million increase in proceeds from sales of property and equipment.

Financing activities

Cash used in financing activities of $67.1 million during 2024 represents a $366.4 million increase in cash used in financing activities when compared to 2023.

The change was primarily due to a $290.3 million decrease in proceeds from debt issuances, net of debt repayments and related charges.

See Note 14 to “Notes to the Consolidated Financial Statements” for further information about our long-term debt transactions and our credit facility.

The year over year increase in cash used in financing activities was also due to $46.5 million increase in repurchases of common stock as well as a decrease in contributions from non-controlling partners, net of distributions, of $30.7 million.

Cash provided by financing activities of $475.7 million during 2025 represents a $542.8 million increase in cash provided by financing activities when compared to 2024.

The change was primarily due to a $589.9 million increase in proceeds from debt issuances, net of debt repayments and related charges.

See Note 14 to “Notes to the Consolidated Financial Statements” for further information about our debt transactions and our credit facility.

The year over year increase in cash provided by financing activities was slightly offset by an increase in distributions to, net of contributions from, non-controlling partners, of $48.3 million.

We recognize derivative instruments as either assets or liabilities in the consolidated balance sheets at fair value using Level 2 inputs.

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Modification of these terms may include changes in loan-to-value ratios requiring the real estate venture to repay portions of the debt.

Our unconsolidated investments in our foreign affiliates are subject to local bank debt primarily for equipment purchases and working capital.

Our equity-method investments in our foreign affiliates are subject to local bank debt primarily for equipment purchases.

This debt is non-recourse to Granite, but it is recourse to the affiliates.

The debt associated with our unconsolidated non-construction entities is included in Note 9 of “Notes to the Consolidated Financial Statements.”

The debt associated with our equity-method investments is included in Note 9 of “Notes to the Consolidated Financial Statements.”

Covenants and Events of Default

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Our failure to comply with these covenants would constitute an event of default under the Credit Agreement.

Additionally, the 3.25 % Convertible Notes and 3.75 % Convertible Notes are governed by the terms and conditions of their respective indentures.

Additionally, the 3.25 % Convertible Notes and 3.75 % Convertible Notes are governed by the terms

and conditions of their respective indentures.

Our failure to pay principal, interest or other amounts when due or within the relevant grace period on our 3.25 % Convertible Notes, our 3.75 % Convertible Notes or our Credit Agreement would constitute an event of default under the 3.25 % Convertible Notes indenture, the 3.75 % Convertible Notes indenture or the Credit Agreement.

A default under our Credit Agreement could result in (i) us no longer being entitled to borrow under such facility;

(ii) termination of such facility;

(ii) the termination of such facility;

(iii) the requirement that any letters of credit under such facility be cash collateralized;

(iv) acceleration of amounts owed under the Credit Agreement;

and/or (v) foreclosure on any collateral securing the obligations under such facility.

(iv) the acceleration of amounts owed under the Credit Agreement;

and/or (v) the foreclosure on any collateral securing the obligations under such facility.

A default under the 3.25 % Convertible Notes indenture or the 3.75 % Convertible Notes indenture could result in acceleration of the maturity of the notes.

The most significant financial covenants under the terms of our Credit Agreement require the maintenance of a minimum Consolidated Interest Coverage Ratio and a maximum Consolidated Leverage Ratio.

The financial covenants under the terms of the Credit Agreement require the maintenance of a minimum Consolidated Interest Coverage Ratio and a maximum Consolidated Leverage Ratio.

As of December 31, 2025, we were in compliance with the covenants in the Credit Agreement.

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As announced on February 3, 2022, on February 1, 2022, the Board of Directors authorized us to purchase up to $300.0 million of our common stock at management’s discretion (the “2022 authorization”).

During the year ended December 31, 2024, we repurchased 524,800 shares under the 2022 authorization and $189.5 million remained available under the 2022 authorization as of December 31, 2024.

During the year ended December 31, 2025 and 2024, we repurchased 300,200 shares and 524,800 shares, respectively, under the 2022 authorization and $157.6 million remained available under the 2022 authorization as of December 31, 2025.

The specific timing and amount of any future repurchases will vary based on market conditions, securities law limitations and other factors.

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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 7. Management’s Discussion and Analysis