TREX CO INC 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures The Company’s management, with the participation of its President and Chief Executive Officer, who is the Company’s principal executive officer, and its Senior Vice President and Chief Financial Officer, who is the Company’s principal financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of December 31, 2025. Based on this evaluation, the President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective. 36 Table of Contents Management’s Report on Internal Control Over Financial Reporting We, as members of management of Trex Company, Inc. (Company), are responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate. We assessed the Company’s internal control over financial reporting as of December 31, 2025, based on criteria for effective internal control over financial reporting established in “Internal Control-Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO Framework). Based on this assessment, we concluded that, as of December 31, 2025, our internal control over financial reporting was effective, based on the COSO Framework. The effectiveness of our internal control over financial reporting as of December 31, 2025, has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report, which follows hereafter. TREX COMPANY, INC. February 25, 2026 By: /S/ BRYAN H. FAIRBANKS Bryan H. Fairbanks President and Chief Executive Officer (Principal Executive Officer) February 25, 2026 By: /S/ PRITHVI S. GANDHI Prithvi S. Gandhi Senior Vice President and Chief Financial Officer (Principal Financial Officer) Changes in Internal Control Over Financial Reporting There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation described above in “Management’s Report on Internal Control Over Financial Reporting” that occurred during the Company’s fourth fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. 37 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Trex Company Inc. Opinion on Internal Control Over Financial Reporting We have audited Trex Company, Inc.’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Trex Company Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the 2025 consolidated financial statements of the Company and our report dated February 25, 2026 expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Baltimore, Maryland February 25, 2026 38 Table of Contents Item 9B. Othe r Information Insider Trading Arrangements . During the quarter ended December 31, 2025 , no ne of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act or any non-Rule 10b5-1 trading arrangement (as identified in Item 408(c) of Regulation S-K). Retention Agreement. On February 24, 2026, the Company entered into a Retention Agreement with Prithvi S. Gandhi, the Company’s Senior Vice President, Chief Financial Officer, pursuant to which the Company will award restricted stock units (RSUs) to Mr. Gandhi, with the RSUs vesting only if Mr. Gandhi is actively employed by the Company on February 24, 2029 (the Retention Date). The aggregate value of the RSUs is $750,000. The number of RSUs shall be based upon the closing market price of the stock on February 24, 2026. The RSUs will be granted pursuant to the Trex Company, Inc. 2023 Stock Incentive Plan. The Retention Agreement provides that the RSUs shall vest, and the cash payment will be made, in the event of the death or disability of the Recipient, if the Company terminates the Recipient’s employment without “cause”, or if the Recipient resigns for “good reason,” prior to the Recipient achieving the applicable Retention Date. For this purpose, “cause” shall mean (i) Recipient’s willful or grossly negligent misconduct, or subversive, disruptive or insubordinate behavior, that is injurious to the Company or that violates Company policy; (ii) Recipient’s embezzlement or misappropriation of funds or property of the Company; (iii) Recipient’s conviction of a felony or the entrance of a plea of guilty or nolo contendere to a felony; (iv) Recipient’s conviction of any crime involving fraud, dishonesty, moral turpitude or breach of trust or the entrance of a plea of guilty or nolo contendere to such a crime; or (v) Recipient’s willful failure or refusal by Recipient to devote Recipient’s full business time (other than on account of disability or approved leave) and attention to the performance of Recipient’s duties and responsibilities if such breach has not been cured within 15 days after written notice thereof is given to the Recipient by the Board, and “good reason” shall mean (i) a material and adverse change in Recipient’s status or position(s) as an officer or management employee of the Company, including, without limitation, any adverse change in his status or position as an employee of the Company as a result of a material diminution in Recipient’s duties or responsibilities (other than, if applicable, any such change directly attributable to the fact that the Company is no longer publicly owned) or the assignment to Recipient of any duties or responsibilities which are materially inconsistent with such status or position(s) (other than any isolated and inadvertent failure by the Company that is cured promptly upon his giving notice), or any removal of Recipient from or any failure to reappoint or reelect Recipient to such position(s) (except in connection with Recipient’s termination other than for good reason); (ii) a 10% or greater reduction in Recipient’s aggregate base salary and targeted bonus, other than any such reduction proportionately consistent with a general reduction of pay across the executive staff as a group, as an economic or strategic measure due to poor financial performance by the Company; (iii) the failure by the Company or any successor to continue in effect any material employee benefit plan (excluding any equity compensation plan) in which the Recipient is participating (or plans providing the Recipient with similar benefits that are not materially reduced in the aggregate) other than as a result of the normal expiration of any such plan in accordance with its terms; or the taking of any action, or the failure to act, by the Company or any successor which would adversely affect the Recipient’s continued participation in any of such plans on at least as favorable a basis to Recipient or which would materially reduce Recipient’s benefits under any of such plans, or (iv) Company’s requiring Recipient to be based at an office that is both more than 50 miles from where Recipient’s office is located and further from Recipient’s then current residence. The Board of Directors has implemented this Retention Agreement reflecting their confidence in Mr. Gandhi’s ability to continue to provide outstanding results and encourage him to continue to focus on the current and future growth of the Company. The foregoing description of the Retention Agreement is qualified in its entirety by reference to the full text of the Retention Agreement, which is filed as Exhibit 10.10 hereto. Item 9C. Disclosure R egarding Foreign Jurisdictions that Prevent Inspections None. 39 Table of Contents PART III Item 10. Directors, Ex ecutive Officers and Corporate Governance Information responsive to this Item 10 is incorporated herein by reference to the sections titled “Information About Nominating and Continuing Directors,” “Named Executive Officers,” and “Corporate Governance” that will be included in our definitive proxy statement for our 2026 annual meeting of stockholders, which we will file with the U.S. Securities and Exchange Commission (SEC) on or before 120 days after our 2025 fiscal year-end. We have adopted a Code of Conduct and Ethics, which is applicable to all directors, officers and employees, including our Chief Executive Officer and Chief Financial Officer. The code is available on our corporate web site and in print to any stockholder who requests a copy. We also make available on our web site, at www.trex.com/our-company/corporate-governance , and in print to any stockholder who requests them, copies of our corporate governance principles and the charters of each standing committee of our board of directors. Requests for copies of these documents should be directed to Corporate Secretary, Trex Company, Inc., 2500 Trex Way, Winchester, Virginia 22601. To the extent required by SEC rules, we intend to disclose any amendments to our code of conduct and ethics, and any waiver of a provision of the code with respect to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, on our web site referred to above within four business days following any such amendment or waiver, or within any other period that may be required under SEC rules from time to time. We have adopted an Insider Trading Policy that governs the purchase or sale of securities by employees, directors, officers, and any other company including customers or suppliers of Trex Company, Inc. A copy of our insider trading policy is filed as Exhibit 19.1 to this Annual Report. Item 11. Exe cutive Compensation Information responsive to this Item 11 is incorporated herein by reference to the sections titled “Non-Employee Director Compensation,” “2025 Non-Employee Director Compensation,” “2025 Non-Employee Director Equity Awards,” “Compensation Discussion and Analysis,” “Report of the Compensation Committee of the Board of Directors of Trex Company, Inc.,” “Summary Compensation Table,” “All Other Compensation Table,” “Grants of Plan-Based Awards,” “Outstanding Equity Awards at Fiscal-Year End,” “2025 Option / SAR Exercises and Stock Vested,” “Retention, Severance and Change in Control Agreements,” “Severance and Change in Control Compensation as of December 31, 2025,” “The Company’s Compensation Policies and Practices as They Relate to Risk,” “Corporate Governance – Compensation Committee Interlocks and Insider Participation” that will be included in our definitive proxy statement for our 2026 annual meeting of stockholders, which we will file with the SEC on or before 120 days after our 2025 fiscal year-end. Item 12. Security O wnership of Certain Beneficial Owners and Management and Related Stockholder Matters Information responsive to this Item 12 is incorporated herein by reference to the sections titled “Security Ownership” and “Equity Compensation Plan Information” that will be included in our definitive proxy statement for our 2026 annual meeting of stockholders, which we will file with the SEC on or before 120 days after our 2025 fiscal year-end. Item 13. Certain R elationships and Related Transactions, and Director Independence Information responsive to this Item 13 is incorporated herein by reference to the sections titled “Corporate Governance – Board Leadership Structure – Director Independence” and “Transactions with Related Persons” that will be included in our definitive proxy statement for our 2026 annual meeting of stockholders, which we will file with the SEC on or before 120 days after our 2025 fiscal year-end. Item 14. Principal Accounting Fees and Services Information responsive to this Item 14 is incorporated herein by reference to the section titled “Independent Registered Public Accounting Firm” that will be included in our definitive proxy statement for our 2026 annual meeting of stockholders, which we will file with the SEC on or before 120 days after our 2025 fiscal year-end. 40 Table of Contents PART IV Item 15. Exhibits an d Financial Statement Schedules (a)(1) The following Consolidated Financial Statements of the Company are incorporated by reference in Part II, Item 8 of this Form 10-K: Report of Independent Registered Public Accounting Firm (PCAOB ID 42) F-2 Consolidated Financial Statements Consolidated Statements of Comprehensive Income for the three years ended December 31, 2025 F- 4 Consolidated Balance Sheets as of December 31, 2025 and 2024 F- 5 Consolidated Statements of Changes in Stockholders’ Equity for the three years ended December 31, 2025 F- 6 Consolidated Statements of Cash Flows for the three years ended December 31, 2025 F- 7 Notes to Consolidated Financial Statements F- 8 (a)(2) The following financial statement schedule is filed as part of this report: Schedule II—Valuation and Qualifying Accounts and Reserves F- 30 All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are inapplicable or not material and, therefore, have been omitted. (a)(3) See Exhibit Index at the end of the Annual Report on Form 10-K for the information required by this Item. Item 16. Form 10-K Summary None. 41 Table of Contents EXHIBIT INDEX Incorporated by reference Exhibit Number Description Form Exhibit Filing Date File No. 3.1 Restated Certificate of Incorporation of Trex Company, Inc. dated July 28, 2021. 10-Q 3.6 August 2, 2021 001-14649 3.2 First Certificate of Amendment to the Restated Certificate of Incorporation of Trex Company, Inc. dated May 5, 2022 10-Q 3.2 May 9, 2022 001-14649 3.3 Amended and Restated By-Laws of the Company dated February 21, 2024. 10-K 3.3 February 26, 2024 001-14649 4.1 Specimen certificate representing the Company’s common stock. S-1/A 4.1 March 24, 1999 333-63287 4.2 First Amendment to Credit Agreement dated as of December 22, 2022 to the Credit Agreement dated May 18, 2022 by and among the Company, as borrower; the guarantors party thereto; Bank of America, N.A. (BOA), as a Lender, Administrative Agent, Swing Line Lender and L/C Issuer; TD Bank, N.A. as lender and Syndication Agent; Regions Bank, PNC Bank, National Association, and Wells Fargo Bank, National Association (each, a Lender and collectively, the Lenders), arranged by BofA Securities, Inc. as Sole Lead Arranger and Sole Bookrunner. 8-K 4.1 December 23, 2022 001-14649 4.3 Credit Agreement dated as of May 18, 2022 between the Company, as borrower; Trex Commercial Products, Inc., as guarantor, Bank of America, N.A., as a Lender, Administrative Agent, Swing Line Lender and L/C Issuer; Wells Fargo Bank, National Association, as lender and Syndication Agent, Regions Bank, PNC Bank, National Association, and TD Bank, N.A., arranged by BofA Securities, Inc. as Sole Lead Arranger and Sole Bookrunner. 8-K 4.1 May 20, 2022 001-14649 4.4 Note dated May 18, 2022 payable by the Company to Bank of America, N.A. in the amount of the lesser of $180,000,000 or the outstanding revolver advances made by Bank of America, N.A. 8-K 4.2 May 20, 2022 001-14649 4.5 Note dated May 18, 2022 payable by the Company to Wells Fargo Bank, National Association in the amount of the lesser of $120,000,000 or the outstanding revolver advances made by Wells Fargo Bank, N.A. 8-K 4.3 May 20, 2022 001-14649 4.6 Note dated May 18, 2022 payable by the Company to Regions Bank in the amount of the lesser of $40,000,000 or the outstanding revolver advances made by Regions Bank. 8-K 4.4 May 20, 2022 001-14649 4.7 Note dated May 18, 2022 payable by the Company to PNC Bank, National Association in the amount of the lesser of $30,000,000 or the outstanding revolver advances made by PNC Bank, National Association. 8-K 4.5 May 20, 2022 001-14649 4.8 Note dated May 18, 2022 payable by the Company to TD Bank, N.A. in the amount of the lesser of $30,000,000 or the outstanding revolver advances made by TD Bank, N.A. 8-K 4.6 May 20, 2022 001-14649 4.9 Security and Pledge Agreement dated as of May 18, 2022 between the Company, as debtor, Trex Commercial Products, Inc., as additional obligor; and Bank of America, N.A. as Administrative Agent (including Notices of Grant of Security Interest in Copyrights and Trademarks). 8-K 4.7 May 20, 2022 001-14649 42 Table of Contents Incorporated by reference Exhibit Number Description Form Exhibit Filing Date File No. 4.10 Fourth Amended and Restated Credit Agreement dated as of November 5, 2019 between the Company, as borrower; Trex Commercial Products, Inc., as guarantor, Bank of America, N.A., as a Lender, Administrative Agent, Swing Line Lender and L/C Issuer; and certain other lenders including Wells Fargo Bank, N.A., who is also Syndication Agent, SunTrust Bank, and Branch Banking and Trust Company arranged by BofA Securities, Inc. as Sole Lead Arranger and Sole Bookrunner. 8-K 4.1 November 6, 2019 001-14649 4.11 First Amendment to the Credit Agreement by and among Trex Company, Inc. as borrower; Trex Commercial Products, Inc. as guarantor; Bank of America, N.A. as a Lender, Administrative Agent, Swing Line Lender and L/C Issuer; and certain other lenders including Wells Fargo Bank, N.A., who is also Syndication Agent; Truist Bank; and Regions Bank, arranged by BofA Securities, Inc. as Sole Lead Arranger and Sole Bookrunner dated May 26, 2020. 8-K 4.1 May 28, 2020 001-14649 4.12 Fourth Amended and Restated Credit Agreement between the Company, as borrower; Trex Commercial Products, Inc., as guarantor, Bank of America, N.A., as a Lender, Administrative Agent, Swing Line Lender and L/C Issuer; and certain other lenders including Wells Fargo Bank, N.A., who is also Syndication Agent, Truist Bank; and Regions Bank, arranged by BofA Securities, Inc. as Sole Lead Arranger and Sole Bookrunner, dated May 26, 2020. 8-K 4.2 May 28, 2020 001-14649 4.13 Note dated November 5, 2019 payable by the Company to Bank of America, N.A. in the amount of the lesser of $125,000,000 or the outstanding revolver advances made by Bank of America, N.A. 8-K 4.2 November 6, 2019 001-14649 4.14 Note dated November 5, 2019 payable by the Company to Wells Fargo Bank, N.A. in the amount of the lesser of $70,000,000 or the outstanding revolver advances made by Wells Fargo Bank, N.A. 8-K 4.3 November 6, 2019 001-14649 4.15 Note dated November 5, 2019 payable by the Company to SunTrust Bank in the amount of the lesser of $30,000,000 or the outstanding revolver advances made by SunTrust Bank. 8-K 4.4 November 6, 2019 001-14649 4.16 Note dated November 5, 2019 payable by the Company to Branch Banking and Trust Company in the amount of the lesser of $25,000,000 or the outstanding revolver advances made by Branch Banking and Trust Company. 8-K 4.5 November 6, 2019 001-14649 4.17 Note dated May 26, 2020 payable by the Company to Regions Bank. 8-K 4.6 May 28, 2020 001-14649 4.18 Fourth Amended and Restated Security and Pledge Agreement dated as of November 5, 2019 between the Company, as debtor, Trex Commercial Products, Inc., as additional obligor; and Bank of America, N.A. as Administrative Agent (including Notices of Grant of Security Interest in Copyrights and Trademarks). 8-K 4.6 November 6, 2019 001-14649 4.19 Description of Securities registered pursuant to Section 12 of the Securities Exchange Act of 1934. 10-K 4.19 February 22, 2021 001-14649 4.20 Second Amendment to Credit Agreement dated as of October 10, 2024 by and among the Company, as borrower; the guarantors party thereto; Bank of America, N.A. (BOA), as a Lender, Administrative Agent, Swing Line Lender and L/C Issuer; TD Bank, N.A. Syndication Agent, arranged by BofA Securities, Inc. as Sole Lead Arranger and Sole Bookrunner. 8-K 4.1 October 11, 2024 001-14649 43 Table of Contents Incorporated by reference Exhibit Number Description Form Exhibit Filing Date File No. 10.1** Trex Company, Inc. 2023 Stock Incentive Plan. 10-Q 10.1 May 8, 2023 001-14649 10.2** Trex Company, Inc. Amended and Restated 1999 Incentive Plan for Outside Directors as amended on July 26, 2023. 10-Q 10.2 July 31, 2023 001-14649 10.3** Form of Trex Company, Inc. 2023 Stock Incentive Plan Stock Appreciation Rights Agreement. 10-Q 10.3 October 28, 2024 001-14649 10.4** Form of Trex Company, Inc. 2023 Stock Incentive Plan Time-Based Restricted Stock Unit Agreement. 10-Q 10.4 October 28, 2024 001-14649 10.5** Form of Trex Company, Inc. 2023 Stock Incentive Plan Performance-Based Restricted Stock Unit Agreement. 10-Q 10.5 October 28, 2024 001-14649 10.6** Form of Trex Company, Inc. Amended and Restated 1999 Incentive Plan for Outside Directors Restricted Stock Unit Agreement. 10-Q 10.6 July 31, 2023 001-14649 10.7** Amended and Restated Severance Agreement dated July 31, 2025 by and between Trex Company, Inc. and Bryan H. Fairbanks. 10-Q 10.1 August 4, 2025 001-14649 10.8** Form of Severance Agreement between Trex Company, Inc. and Officers other than the Chief Executive Officer. 10-Q 10.2 August 4, 2025 001-14649 10.9** Form of Retention Agreement between Trex Company, Inc. and Amy M. Fernandez dated October 30, 2025. 10-Q 10.2 November 4, 2025 001-14649 10.10*/** Form of Retention Agreement between Trex Company, Inc. and Prithvi S. Gandhi dated February 24, 2026. 10.11 AIA document A141 – 2014 Agreement dated July 7, 2022 by and between Trex Company, Inc. and Gray Construction, Inc. 8-K 10.1 July 12, 2022 001-14649 10.12 Form of Indemnity Agreement for Directors. 10-K 10.19 March 12, 2009 001-14649 10.13 Form of Indemnity Agreement for Officers. 10-K 10.20 March 12, 2009 001-14649 10.14 Form of Indemnity Agreement for Director/Officers. 10-K 10.21 March 12, 2009 001.14649 10.15 Form of Distributor Agreement of Trex Company, Inc. 10-K 10.23 March 12, 2009 001-14649 10.16 Form of Trex Company, Inc. Fencing Agreement for Installers/Retailers. 10-Q 10.4 November 9, 2006 001-14649 10.17 Asset Purchase Agreement dated as of December 30, 2022 by and between Trex Commercial Products, Inc., Trex Company, Inc. and Sightline Commercial Solutions, LLC. 8-K 10.1 December 30, 2022 001-14649 18.1* Preferability Letter of Ernst & Young LLP, Independent Registered Public Accounting Firm. 19.1 Insider Trading Policy 10-K 19.1 February 26, 2024 001-14649 23* Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm. 31.1* Certification of Chief Executive Officer of the Company pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934. 31.2* Certification of Chief Financial Officer of the Company pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934. 32*** Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350). 97.1 Recovery of Compensation for Accounting Restatements Policy 10-K 97.1 February 24, 2025 001-14649 44 Table of Contents Incorporated by reference Exhibit Number Description Form Exhibit Filing Date File No. 101.INS* Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH* Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents. 104.1 Cover Page Interactive Data File—The cover page interactive data file does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. * Filed herewith. ** Management contract or compensatory plan or agreement. *** Furnished herewith. 45 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Trex Company, Inc. Date: February 25, 2026 By:  /S/ B RYAN H. F AIRBANKS Bryan H. Fairbanks President and Chief Executive Officer (Duly Authorized Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed as of February 25, 2026 by the following persons on behalf of the registrant and in the capacities indicated. Signature Title /S/ B ryan H. Fairbanks Bryan H. Fairbanks President and Chief Executive Officer (Principal Executive Officer); Director /S/ P rithvi S. G andhi Prithvi S. Gandhi Senior Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) /S/ James E. Cline James E. Cline Chairman /S/ Ronald W. Kaplan Ronald W. Kaplan Vice Chairman /S/ Jay M. Gratz Jay M. Gratz Director /S/ Kristine L. Juster Kristine L. Juster Director /S/ D. C hristian K effer D. Christian Keffer Director /S/ Gena C. Lovett Gena C. Lovett Director /S/ Patricia B. Robinson Patricia B. Robinson Director /S/ B. Andrew Rose B. Andrew Rose Director /S/ I rene Tasi I rene Tasi Director 46 Table of Contents Signature Title /S/ Gerald Volas Gerald Volas Director 47 Table of Contents TREX COMPANY, INC. Index to Consoli dated Financial Statements Page Report of Independent Registered Public Accounting Firm (PCAOB ID 42 ) F-2 Consolidated Financial Statements Consolidated Statements of Comprehensive Income for the three years ended December 31, 2025 F- 4 Consolidated Balance Sheets as of December 31, 2025 and 2024 F- 5 Consolidated Statements of Changes in Stockholders’ Equity for the three years ended December 31, 2025 F- 6 Consolidated Statements of Cash Flows for the three years ended December 31, 2025 F- 7 Notes to Consolidated Financial Statements F- 8 The following Consolidated Financial Statement Schedule of the Registrant is filed as part of this Report as required to be included in Item 15(a)(2): Page Schedule II—Valuation and Qualifying Accounts and Reserves F- 30 F- 1 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Trex Company, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Trex Company, Inc. (the Company) as of December 31, 2025 and 2024, the related consolidated statements of comprehensive income , changes in stockholders' equity and cash flows for each of the three years in the period ended December 31, 2025, 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, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, 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, 2025, 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 February 25, 2026 expressed an unqualified opinion thereon. Change in Accounting Principle As discussed in Note 2 to the consolidated financial statements, the Company has elected to change its method of accounting for inventories from the last-in, first-out method to the first-in, first-out method, effective October 1, 2025, with retrospective application to all periods presented. Our opinion is not modified with respect to this matter. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. 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. F- 2 Table of Contents Product Warranty Liability Description of the Matter At December 31, 2025, the Company’s product warranty liability was $29.7 million. As discussed in Note 19 of the consolidated financial statements, the Company accrues for the estimated cost of product warranty claims at the time revenue is recognized based on such factors as historical claims experience and future claim projections. Management reviews and adjusts these estimates, if necessary, based on the differences between actual experience and historical estimates. Auditing aspects of the product warranty liability was complex and highly judgmental due to the significant estimation of numerous variables required in determining the liability. In particular, the estimate was sensitive to significant assumptions such as the estimated number of future claim counts and costs incurred to settle claims. These assumptions have a significant effect on the product warranty liability. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the controls over the Company’s process to estimate the general product warranty liability, including controls over management’s review of the significant assumptions described above. We also tested management’s controls over the completeness and accuracy of the data used in the model. To audit the product warranty liability recorded by management, we performed procedures that included, among others, evaluating the methodology applied and the significant assumptions used in the Company’s calculation. We tested the completeness and accuracy of the claims data used by management. We performed analyses to determine the sensitivity of changes in the significant assumptions described above. We also involved an internal actuarial specialist to assist in our evaluation of the methodology applied and significant assumptions utilized by management to calculate the product warranty liability. /s/ Ernst & Young LLP We have served as the Company’s auditor since 1995. Baltimore, Maryland February 25, 2026 F- 3 Table of Contents TREX COMPANY, INC. CONSOLIDATED STATEMENTS OF C OMPREHENSIVE INCOME Year Ended December 31, 2025 2024 2023 (In thousands, except share and per share data) Net sales $ 1,174,267 $ 1,151,449 $ 1,094,837 Cost of sales 714,303 649,551 644,042 Gross profit 459,964 501,898 450,795 Selling, general and administrative expenses 202,003 179,995 176,203 Income from operations 257,961 321,903 274,592 Interest (income) expense, net - ( 11 ) 5 Income before income taxes 257,961 321,914 274,587 Provision for income taxes 67,546 83,468 70,468 Net income $ 190,415 $ 238,446 $ 204,119 Basic earnings per common share $ 1.78 $ 2.20 $ 1.88 Basic weighted average common shares outstanding 107,010,658 108,191,635 108,680,459 Diluted earnings per common share $ 1.78 $ 2.20 $ 1.88 Diluted weighted average common shares outstanding 107,095,977 108,322,576 108,809,403 Comprehensive income $ 190,415 $ 238,446 $ 204,119 See Notes to Consolidated Financial Statements. F- 4 Table of Contents TREX COMPANY, INC. CONSOLIDATED B ALANCE SHEETS December 31, 2025 2024 (In thousands) ASSETS Current Assets: Cash and cash equivalents $ 3,807 $ 1,292 Accounts receivable, net 48,091 88,356 Inventories 238,665 256,951 Prepaid expenses and other assets 19,843 21,978 Total current assets 310,406 368,577 Property, plant and equipment, net 1,049,733 922,868 Operating lease assets 52,632 52,195 Goodwill and other intangible assets, net 31,529 22,048 Other assets 9,141 8,279 Total Assets $ 1,453,441 $ 1,373,967 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Accounts payable $ 34,759 $ 61,272 Accrued expenses and other liabilities 77,030 72,879 Accrued warranty 5,416 5,726 Line of credit 133,500 202,600 Total current liabilities 250,705 342,477 Deferred income taxes 85,833 68,719 Operating lease liabilities 41,755 41,979 Non-current accrued warranty 24,324 17,109 Other long-term liabilities 16,560 16,559 Total Liabilities 419,177 486,843 Commitments and contingencies — — Stockholders’ Equity: Preferred stock, $ 0.01 par value, 3,000,000 shares authorized; no ne issued and outstanding — — Common stock, $ 0.01 par value, 360,000,000 shares authorized; 141,208,139 and 141,098,251 shares issued and 105,737,266 and 107,154,305 shares outstanding at December 31, 2025 and December 31, 2024, respectively 1,412 1,411 Additional paid-in capital 155,316 148,153 Retained earnings 1,789,847 1,599,432 Treasury stock, at cost, 35,470,873 and 33,943,946 shares at December 31, 2025 and December 31, 2024, respectively ( 912,311 ) ( 861,872 ) Total Stockholders’ Equity 1,034,264 887,124 Total Liabilities and Stockholders’ Equity $ 1,453,441 $ 1,373,967 See Notes to Consolidated Financial Statements. F- 5 Table of Contents TREX COMPANY, INC. CONSOLIDATED STATEMENTS OF C HANGES IN STOCKHOLDERS’ EQUITY (In thousands, except share data) Common Stock Additional Paid-In Retained Treasury Stock Shares Amount Capital Earnings Shares Amount Total Balance, December 31, 2022 108,743,423 $ 1,408 $ 131,539 $ 1,156,867 32,098,410 $ ( 745,272 ) $ 544,542 Net income — — — 204,119 — — 204,119 Employee stock plans 27,620 — 1,223 — — — 1,223 Shares withheld for taxes on awards ( 48,736 ) 2 ( 2,769 ) — — — ( 2,767 ) Stock-based compensation 154,126 — 10,164 — — — 10,164 Repurchases of common stock ( 264,896 ) — — — 264,896 ( 15,682 ) ( 15,682 ) Balance, December 31, 2023 108,611,537 $ 1,410 $ 140,157 $ 1,360,986 32,363,306 $ ( 760,954 ) $ 741,599 Net income — — — 238,446 — — 238,446 Employee stock plans 20,604 — 1,281 — — — 1,281 Shares withheld for taxes on awards ( 65,081 ) 1 ( 5,920 ) — — — ( 5,919 ) Stock-based compensation 167,885 — 12,635 — — — 12,635 Repurchases of common stock ( 1,580,640 ) — — — 1,580,640 ( 100,918 ) ( 100,918 ) Balance, December 31, 2024 107,154,305 $ 1,411 $ 148,153 $ 1,599,432 33,943,946 $ ( 861,872 ) $ 887,124 Net income — — — 190,415 — — 190,415 Employee stock plans 28,884 — 1,185 — — — 1,185 Shares withheld for taxes on awards ( 50,405 ) 1 ( 3,137 ) — — — ( 3,136 ) Stock-based compensation 131,409 — 9,115 — — — 9,115 Repurchases of common stock ( 1,526,927 ) — — — 1,526,927 ( 50,439 ) ( 50,439 ) Balance, December 31, 2025 105,737,266 $ 1,412 $ 155,316 $ 1,789,847 35,470,873 $ ( 912,311 ) $ 1,034,264 See Notes to Consolidated Financial Statements. F- 6 Table of Contents TREX COMPANY, INC. CONSOLIDATED STATE MENTS OF CASH FLOWS Year Ended December 31, 2025 2024 2023 (In thousands) Operating Activities Net income $ 190,415 $ 238,446 $ 204,119 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 62,957 54,670 50,189 Deferred income taxes 17,114 ( 12,231 ) 3,868 Stock-based compensation 9,115 12,635 10,164 Loss (gain) on disposal of property, plant and equipment 522 2,644 3,140 Other non-cash adjustments ( 53 ) 187 ( 48 ) Changes in operating assets and liabilities: Accounts receivable 40,265 ( 47,220 ) 56,921 Inventories 18,286 ( 116,423 ) 35,878 Prepaid expenses and other assets 3,468 ( 10,650 ) ( 750 ) Accounts payable 6,878 ( 819 ) 2,697 Accrued expenses and other liabilities 8,771 12,162 8,875 Income taxes receivable/payable 375 10,528 14,367 Net cash provided by operating activities 358,113 143,929 389,420 Investing Activities Expenditures for property, plant and equipment ( 223,592 ) ( 232,337 ) ( 166,089 ) Internally developed and purchased intangibles ( 9,983 ) ( 4,304 ) — Proceeds from sales of property, plant and equipment 358 106 — Net cash used in investing activities ( 233,217 ) ( 236,535 ) ( 166,089 ) Financing Activities Borrowings under line of credit 880,547 842,300 593,500 Principal payments under line of credit ( 949,647 ) ( 645,200 ) ( 810,000 ) Repurchases of common stock ( 54,472 ) ( 105,940 ) ( 18,450 ) Proceeds from employee stock purchase and option plans 1,185 1,282 1,223 Financing costs 6 ( 503 ) 30 Net cash (used in) provided by financing activities ( 122,381 ) 91,939 ( 233,697 ) Net increase (decrease) in cash and cash equivalents 2,515 ( 667 ) ( 10,366 ) Cash and cash equivalents at beginning of year 1,292 1,959 12,325 Cash and cash equivalents at end of year $ 3,807 $ 1,292 $ 1,959 Supplemental disclosures of cash flow information: Cash paid for interest, net of capitalized interest $ — $ — $ 51 Cash paid for income taxes, net $ 50,056 $ 85,171 $ 52,340 Supplemental non-cash investing and financing disclosure: (Decrease) increase in capital expenditures in accounts payable $ ( 33,390 ) $ 38,129 $ 1,332 See Notes to Consolidated Financial Statements. F- 7 Table of Contents TREX COMPANY, INC. NOTES TO CONSO LIDATED FINANCIAL STATEMENTS 1. BUSINESS AND ORGANIZATION Trex Company, Inc. (Trex or Company), a Delaware corporation, was incorporated on September 4, 1998. The Company operates in a single reportable segment. The Company’s principal business based on net sales is the manufacture and distribution of high-performance, low-maintenance wood-alternative decking and railing and outdoor living products and accessories, marketed under the brand name Trex ® . A majority of its products are manufactured in a proprietary process that combines reclaimed wood fibers and recycled polyethylene. The principal executive offices are located at 2500 Trex Way, Winchester, Virginia 22601, and the telephone number at that address is (540) 542-6300. 2. CHANGE IN ACCOUNTING PRINCIPLE FOR INVENTORY VALUATION During the fourth quarter, the Company changed its accounting method of valuing inventory from a last-in, first-out (LIFO) method to a first-in, first-out (FIFO) method. The Company believes this change in accounting method is preferable as it: • More accurately reflects the value of inventory on the consolidated balance sheet at each reporting period; • Is consistent with how the Company manages its business as it reflects the actual flow of inventory in operations and is consistent with business planning; • Is on a more comparable basis with the primary competitors in its industry peer group The Company has retrospectively applied the effects of the accounting change to all periods presented. The following tables summarize the effect of the accounting change from LIFO to FIFO on impacted line items in the Company’s consolidated financial statements as follows: Consolidated Statements of Comprehensive Income Year Ended December 31, 2023 (In thousands, except share and per share data) As Previously Reported Effect of Change in Accounting Principle As Adjusted Net sales $ 1,094,837 $ — $ 1,094,837 Cost of sales 642,430 1,612 644,042 Gross profit $ 452,407 $ ( 1,612 ) $ 450,795 Selling, general and administrative expenses 176,203 — 176,203 Income from operations $ 276,204 $ ( 1,612 ) $ 274,592 Interest (income) expense, net 5 — 5 Income before income taxes $ 276,199 $ ( 1,612 ) $ 274,587 Provision for income taxes 70,815 ( 347 ) 70,468 Net income $ 205,384 $ ( 1,265 ) $ 204,119 Basic earnings per share $ 1.89 $ ( 0.01 ) $ 1.88 Basic weighted average common shares outstanding 108,680,459 108,680,459 108,680,459 Diluted earnings per share $ 1.89 $ ( 0.01 ) $ 1.88 Diluted weighted average common shares outstanding 108,809,403 108,809,403 108,809,403 Comprehensive income $ 205,384 $ ( 1,265 ) $ 204,119 F- 8 Table of Contents Consolidated Statements of Comprehensive Income Year Ended December 31, 2024 (In thousands, except share and per share data) As Previously Reported Effect of Change in Accounting Principle As Adjusted Net sales $ 1,151,449 $ — $ 1,151,449 Cost of sales 665,781 ( 16,230 ) 649,551 Gross profit 485,668 16,230 501,898 Selling, general and administrative expenses 179,995 — 179,995 Income from operations 305,673 16,230 321,903 Interest (income) expense, net ( 11 ) — ( 11 ) Income before income taxes 305,684 16,230 321,914 Provision for income taxes 79,292 4,176 83,468 Net income $ 226,392 $ 12,054 $ 238,446 Basic earnings per share $ 2.09 $ 0.11 $ 2.20 Basic weighted average common shares outstanding 108,191,635 108,191,635 108,191,635 Diluted earnings per share $ 2.09 $ 0.11 $ 2.20 Diluted weighted average common shares outstanding 108,322,576 108,322,576 108,322,576 Comprehensive income $ 226,392 $ 12,054 $ 238,446 The only interim period impacted in 2024 was the fourth quarter, as there were no interim LIFO adjustments recognized during the first three quarters of 2024. There were no interim LIFO adjustments in 2025. Consolidated Statements of Comprehensive Income Quarter Ended December 31, 2024 (In thousands, except share and per share data) As Previously Reported Effect of Change in Accounting Principle As Adjusted Net sales $ 167,627 $ — $ 167,627 Cost of sales 112,885 ( 16,230 ) 96,655 Gross profit 54,742 16,230 70,972 Selling, general and administrative expenses 39,287 — 39,287 Income from operations 15,455 16,230 31,685 Interest (income) expense, net — — — Income before income taxes 15,455 16,230 31,685 Provision for income taxes 5,683 4,176 9,859 Net income $ 9,772 $ 12,054 $ 21,826 Basic earnings per share $ 0.09 $ 0.11 $ 0.20 Basic weighted average common shares outstanding 107,184,416 107,184,416 107,184,416 Diluted earnings per share $ 0.09 $ 0.11 $ 0.20 Diluted weighted average common shares outstanding 107,320,299 107,320,299 107,320,299 Comprehensive income $ 9,772 $ 12,054 $ 21,826 F- 9 Table of Contents Consolidated Balance Sheets December 31, 2024 (in thousands) As Previously Reported Effect of Change in Accounting Principle As Adjusted Assets Current assets: Inventories $ 207,282 $ 49,669 $ 256,951 Total current assets 318,908 49,669 368,577 TOTAL ASSETS $ 1,324,298 $ 49,669 $ 1,373,967 Liabilities and Stockholders' Equity Liabilities: Deferred income taxes $ 56,032 $ 12,687 $ 68,719 Total liabilities 474,156 12,687 486,843 Stockholders' equity: Retained earnings* 1,562,450 36,982 1,599,432 Total stockholders' equity 850,142 36,982 887,124 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,324,298 $ 49,669 $ 1,373,967 * As a result of the accounting change, retained earnings as of January 1, 2023 increased from $ 1.1 billion, as originally reported using the LIFO method, to $ 1.2 billion using the FIFO method . Consolidated Statements of Cash Flows Year Ended December 31, 2023 (in thousands) As Previously Reported Effect of Change in Accounting Principle As Adjusted Operating Activities: Net income $ 205,384 $ ( 1,265 ) $ 204,119 Income taxes $ 4,215 $ ( 347 ) $ 3,868 Inventories $ 34,266 $ 1,612 $ 35,878 Consolidated Statements of Cash Flows Year Ended December 31, 2024 (in thousands) As Previously Reported Effect of Change in Accounting Principle As Adjusted Operating Activities: Net income $ 226,392 $ 12,054 $ 238,446 Income taxes $ ( 16,407 ) $ 4,176 $ ( 12,231 ) Inventories $ ( 100,193 ) $ ( 16,230 ) $ ( 116,423 ) F- 10 Table of Contents 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The consolidated financial statements include the accounts of the Company. The Company’s results of operations are affected by a number of factors, including, but not limited to, the cost to manufacture and distribute products, cost of raw materials, inflation, tariffs, consumer spending and preferences, interest rates, the impact of any supply chain disruptions, economic conditions, and/or any adverse effects from global health pandemics and geopolitical conflicts. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Actual results could differ from those estimates. Cash and Cash Equivalents Cash equivalents consist of highly liquid investments purchased with original maturities of three months or less. Concentrations and Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and trade accounts receivable. The Company from time to time may have bank deposits in excess of insurance limits of the Federal Deposit Insurance Corporation. As of December 31, 2025 , substantially all deposits are maintained in one financial institution. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk related to its cash and cash equivalents. The Company routinely assesses the financial strength of its customers and believes that its trade receivables credit risk exposure is limited. Trade receivables are recognized at the amount of revenue recognized on each shipment for Trex products as the Company has an unconditional right to consideration from the customer and payment is due based solely on the passage of time. An estimate of expected credit losses is recognized as a valuation allowance and adjusted each reporting period. The estimate is based on the current expected credit loss model and is determined using an aging schedule, including past events, current conditions and reasonable and supportable forecasts about the future. There was no material valuation allowance recorded as of December 31, 2025 and December 31, 2024. In the years ended December 31, 2025, 2024, and 2023, sales to certain customers accounted for 10% or more of the Company’s total net sales. For the year ended December 31, 2025 , three customers represented approximately 73 % of the Company’s total net sales. For the year ended December 31, 2024 , three customers represented 81 % of the Company’s total net sales. For the year ended December 31, 2023 , three customers represented approximately 72 % of the Company’s total net sales. No other customer represented 10% or more of the Company’s total net sales. At December 31, 2025 , two customers represented 22 %, and 21 %, respectively, of the Company’s total accounts receivable balance. At December 31, 2024 , two customers represented 33 % and 32 %, respectively, of the Company’s total accounts receivable balance. For each year ended December 31, 2025 , 2024, and 2023, approximately 23.3 %, 21.4 %, and 26.7 %, respectively, of the Company’s materials purchases were purchased from its four largest suppliers. Inventories Inventories for the composite decking and railing products at Trex are valued at the lower of cost (first-in, first-out, or FIFO, method) and net realizable value as this method results in a better matching of costs and revenues. The Company periodically reviews its inventory for slow moving or obsolete items and writes down the related products to the lower of cost or net realizable value. The Company’s reserves for estimated slow moving products or obsolescence are not material. A majority of the products at Trex are made in a proprietary process that combines reclaimed wood fibers and scrap polyethylene. Trex grinds up scrap materials generated from its manufacturing process and inventories deemed no longer salable and reintroduces the reclaimed material into the manufacturing process as a substitute for raw materials. The reclaimed material is valued at the cost of the raw material components of the material. F- 11 Table of Contents Property, Plant and Equipment Property, plant and equipment are stated at historical cost. The costs of additions and improvements are capitalized, while maintenance and repairs are expensed as incurred. Cash flows for capital expenditures as reported in cash flows from investing activities in the Consolidated Statements of Cash Flows are adjusted to exclude unpaid amounts accrued at period end. Depreciation is provided using the straight-line method generally over the following estimated useful lives: Buildings 40 years Machinery and equipment 3 - 11 years Furniture and fixtures 10 years Forklifts and tractors 5 years Computer equipment and software 5 years Leasehold improvements are amortized over the shorter of the lease term or 15 years. The Company reviews its long-lived assets, including property, plant and equipment, whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine the recoverability of its long-lived assets, the Company evaluates the probability that future estimated undiscounted net cash flows will be less than the carrying amount of the long-lived assets. If the estimated cash flows are less than the carrying amount of the long-lived assets, the assets are written down to their fair value. The Company’s estimates of anticipated cash flows and the remaining estimated useful lives of long-lived assets could be reduced in the future. As a result, the carrying amount of long-lived assets could be reduced in the future. Long-lived assets held for sale are stated at the lower of cost or fair value less cost to sell. Leases The Company leases office space, storage warehouses, training and manufacturing facilities, and certain office and plant equipment under various operating leases. At inception of an arrangement, the Company evaluates, among other things, whether it has the right to control the use of an identified asset in order to determine if the arrangement is or contains a lease. Operating leases are included in operating lease assets, accrued expenses and other current liabilities, and operating lease liabilities in the consolidated balance sheets. Operating leases with an initial term of 12 months or less are not included in the consolidated balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. ROU assets represent the right to use an underlying asset for the lease term and operating lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the implicit rates of the Company’s leases are not readily determinable, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company considers instruments with similar characteristics when calculating its incremental borrowing rate. Certain events, such as a modification to the arrangement or a change in the lease term, are assessed by the Company to determine if it is required to reassess estimates and judgments and remeasure the lease liability and ROU asset. The Company reviews its ROU asset for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be fully recoverable. The carrying amount of the ROU asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of the asset. An impairment loss is measured as the amount by which the carrying amount of the ROU asset exceeds its fair value. The Company’s operating leases have remaining lease terms up to 11 years. Lease terms may include options to extend or terminate the lease when the Company determines that it is reasonably certain it will exercise the option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately. Consideration for non-lease components is stated on a stand-alone basis in the applicable agreements. Fair Value Measurement Assets and liabilities measured at fair value are measured at the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and classified into one of the following fair value hierarchies: • Level 1 – Quoted prices for identical instruments in active markets. • Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which all significant inputs and significant value drivers are observable in active markets. F- 12 Table of Contents • Level 3 – Valuations derived from management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Goodwill Goodwill represents the excess of cost over net assets acquired resulting from the Company’s 1996 purchase of the Mobil Composite Products Division, the 2011 purchase of the assets of the Iron Deck Corporation, and the 2017 purchase of certain assets and the assumption of certain liabilities of SC Company. The Company evaluates the recoverability of goodwill in accordance with Accounting Standard Codification Topic 350, “ Intangibles – Goodwill and Other ,” annually or more frequently if an event occurs or circumstances change in the interim that would more likely than not reduce the fair value of the asset below its carrying amount. Goodwill is considered to be impaired when the net book value of the reporting unit exceeds its estimated fair value. Trex has one reporting unit. In testing for goodwill impairment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount, including goodwill. If the qualitative assessment indicates that the carrying amount of the reporting unit exceeds its fair value, including goodwill, the Company is then required to perform a quantitative goodwill impairment test. The quantitative goodwill impairment test, used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of its reporting unit with its carrying amount, including goodwill. The fair value of its reporting unit refers to the price that would be received to sell the unit as a whole in an orderly transaction between market participants at the measurement date. If the carrying amount of the reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company performs the annual impairment testing of its goodwill as of October 31 of each year. For fiscal years 2025, 2024 and 2023, the Company completed its annual impairment test utilizing the qualitative assessment and concluded it was not more likely than not that the fair value of the reporting unit was less than its carrying amount. Qualitative factors the Company considered include events and circumstances such as macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, and other relevant Company-specific events, as applicable. Product Warranty The Company warrants that for the applicable warranty period its products, when properly installed, used and maintained, will be free from material defects in workmanship and materials and its decking, cladding, fascia and railing products will not split, splinter, rot or suffer structural damage from termites or fungal decay. Products sold on or after January 1, 2023: The warranty period for residential use is 50 years for Transcend ® decking, 35 years for Select ® decking and Universal Fascia, and 25 years for Enhance ® decking and Transcend, Select, Enhance and Signature ® railing. The warranty period for commercial use is 10 years, excluding Signature railing and Transcend cladding, which each have a warranty period of 25 years. The Company further warrants that Trex Transcend, Trex Enhance and Trex Select decking and cladding and Universal Fascia products will not fade in color from light and weathering exposure more than a certain amount and will be resistant to permanent staining from food and beverage substances or mold and mildew, provided the stain is cleaned within seven days of appearance, for the warranty period referred to above. If there is a breach of such warranties, the Company has an obligation either to replace the defective product or refund the purchase price. Products sold prior to January 1, 2023: The warranty period is 25 years for residential use and 10 years for commercial use. With respect to Trex Signature railing, the warranty period is 25 years for both residential and commercial use. The Company further warrants that Trex Transcend, Trex Enhance, Trex Select and Universal Fascia products will not fade in color more than a certain amount and will be resistant to permanent staining from food substances or mold, provided the stain is cleaned within seven days of appearance, for the warranty period referred to above. If there is a breach of such warranties, the Company has an obligation either to replace the defective product or refund the purchase price. The Company maintains a warranty reserve for the settlement of its product warranty claims. The Company accrues for the estimated cost of product warranty claims at the time revenue is recognized based on such factors as historical claims experience and expected future claims projections. To estimate future claims projections, the Company utilizes actuarial techniques to determine a reasonable possible range of amounts to be paid related to defects covered by our product warranty. The actuarial techniques consider claims received, claims closed, and the amounts paid on claims. Estimates for these elements are quantified using a range of assumptions derived from claim history and consideration of additional factors influencing claim counts or costs incurred to settle claims in order determine the best estimate of future claims for which to record a related liability. Management reviews and adjusts these estimates, if necessary, based on the differences between actual experience and historical estimates. F- 13 Table of Contents Treasury Stock The Company records the repurchase of shares of its common stock at cost. These shares are considered treasury stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares. Revenue Recognition Trex principally generates revenue from the manufacture and sale of its high-performance, low-maintenance, eco-friendly composite decking and railing products and accessories. Substantially all of its revenues are from contracts with customers, which are individual customer purchase orders of short-term duration of less than one year. Trex satisfies its performance obligations at a point in time. The shipment of each product is a separate performance obligation as the customer is able to derive benefit from each product shipped and no performance obligation remains after shipment. Upon shipment of the product, the customer obtains control over the distinct product and Trex satisfies its performance obligation. Any performance obligation that remains unsatisfied at the end of a reporting period is part of a contract that has an original expected duration of one year or less. Any variable consideration related to the unsatisfied performance obligation is allocated wholly to the unsatisfied performance obligation and recognized when the product ships and the performance obligation is satisfied and is included in “Accrued expenses and other liabilities, Sales and marketing” in Note 8 to these Consolidated Financial Statements. Stock-Based Compensation The Company measures stock-based compensation at the grant date of the award based on the fair value. For stock options, stock appreciation rights and time-based restricted stock and time-based restricted stock units, stock-based compensation is recognized on a straight-line basis over the vesting periods of the award. The Company recognizes forfeitures as they occur. For performance-based restricted stock and performance-based restricted stock units, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is probable to be paid out based on the achievement of predetermined performance measures. Stock-based compensation expense is included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. Income Taxes The Company recognizes deferred tax assets and liabilities based on the difference between the financial statement basis and tax basis of assets and liabilities using enacted tax laws and statutory tax rates. The Company assesses the likelihood that its deferred tax assets will be realized. Deferred tax assets are reduced by a valuation allowance when, after considering all available positive and negative evidence, it is determined that it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. As of December 31, 2025 , the Company has a valuation allowance of $ 2.2 million against these deferred tax assets related to certain state tax credits. The Company analyzes its position in subsequent reporting periods, considering all available positive and negative evidence, in determining the expected realization of its deferred tax assets. Research and Development Costs Research and development costs are expensed as incurred. For the years ended December 31, 2025 , 2024, and 2023, research and development costs were $ 4.2 million, $ 3.5 million, and $ 3.3 million, respectively, and have been included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. Advertising Costs The Company expenses its branding and advertising communication costs as incurred. Advertising production costs are deferred and recognized as expense in the period that the related advertisement is first used. For the years ended December 31, 2025 , 2024, and 2023, branding expenses, including advertising expenses, were $ 61.0 million, $ 53.5 million, and $ 48.8 million, respectively. Fair Value of Financial Instruments The Company considers the recorded value of its financial assets and liabilities, consisting primarily of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities, and debt to approximate the fair value of the respective assets and liabilities on the Consolidated Balance Sheets at December 31, 2025 and 2024. F- 14 Table of Contents New Accounting Standards Recently Adopted In December 2023, the FASB issued ASU No. 2023-09 , “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The guidance requires public entities to disclose additional categories of information related to federal, state, and foreign income taxes and additional details related to reconciling items should they meet a quantitative threshold. The guidance requires disclosure of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes and to disaggregate the information by jurisdiction based on quantitative thresholds. The guidance is effective for fiscal year beginning after December 15, 2024. Early adoption was permitted. The Company adopted the standard in the quarterly period ended December 31, 2025 . The Company applied the standard retrospectively and accordingly prior periods were adjusted. Adoption of this guidance did no t impact consolidated results of operations and financial position. New Accounting Standards Not Yet Adopted In September 2025, the FASB issued ASU No. 2025-06, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)." This guidance clarifies and modernizes when an entity is required to begin capitalizing software costs. Specifically, it requires capitalization when both of the following are met (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The amendments to this update are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption of this update is permitted. The amendments to this update may be applied prospectively, retrospectively, or on a modified transition approach. The Company is evaluating this guidance and the impact it may have on its Consolidated Financial Statements upon adoption. In July 2025, the FASB issued ASU No. 2025-05, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets." This guidance provides an optional practical expedient related to the estimation of expected credit losses for current accounts receivable and contract assets that arise from transactions accounted for under FASB Accounting Standards Codification 606. Specifically, this optional practical expedient allows an entity to assume that current conditions as of the balance sheet date will not change for the remaining life of the asset. The amendments to this update are effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption of this update is permitted. The amendments to this update should be applied prospectively. The Company continues to evaluate the guidance and does not believe adoption will have a material impact on its consolidated results of operations or financial position. In November 2024, the FASB issued ASU No. 2024-03, “Income Statement – Reporting Comprehensive Income – Disaggregation Disclosures.” This guidance requires more detailed disclosure about the types of expenses presented within the expense captions of the financial statements. Specifically, disclosure of purchases of inventory, employee compensation, depreciation, and intangible asset amortization are required on both an interim and annual basis. In addition, a qualitative description of remaining amounts in relevant expense captions which have not separately been disaggregated will be required on an interim and annual basis. On an annual basis, disclosure of an entity’s definition of selling expenses and the amount of selling expenses is required. The amendments to this update are effective for annual reporting periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption of this update is permitted. The amendments to this update should be applied prospectively to financial statements issued for reporting periods after the effective date of the update or retrospectively to any or all prior periods presented in the financial statements. The Company believes adoption will result in expanded financial statement footnote disclosure but does not believe adoption of this update will have a material impact on its consolidated results of operations. The Company is continuing to evaluate the impacts of the pending adoption. As such, the Company’s preliminary assessments are subject to change. 4. INVENTORIES Inventories at FIFO value consist of the following as of December 31 (in thousands): 2025 2024 Finished goods $ 179,758 $ 183,670 Raw materials 58,907 73,281 Total FIFO (first-in, first-out) inventories 238,665 256,951 The Company periodically reviews its inventory for slow moving or obsolete items and writes down the related products to estimated net realizable value. During the year ended December 31, 2025 the Company adjusted reserves for estimated slow moving products or obsolescence. These reserves are not material. F- 15 Table of Contents 5. PREPAID EXPENSES AND OTHER ASSETS Prepaid expenses and other assets consist of the following as of December 31 (in thousands): 2025 2024 Prepaid expenses $ 17,173 $ 21,353 Income tax receivable 2,147 — Other 523 625 Total prepaid expenses and other assets $ 19,843 $ 21,978 6. GOODWILL AND OTHER INTANGIBLE ASSETS, NET The carrying amount of goodwill at December 31, 2025, and December 31, 2024 , was $ 14.2 million for Trex. For fiscal years 2025, 2024 and 2023, the Company completed its annual impairment test of goodwill for its reporting unit utilizing the qualitative assessment and concluded it was not more likely than not that the fair value of the Company's sole reporting unit was less than its carrying amount. The Company’s intangible assets, purchased in 2018, 2024, and 2025, consist of domain names and internal use software. Intangible asset amounts were determined based on the estimated economics of the asset and are amortized over the estimated useful lives on a straight-line basis over 15 years for domain names and 10 years for internal use software related to the Company's ERP and other platform tools, which approximates the pattern in which the economic benefits are expected to be received. The Company evaluates the recoverability of intangible assets periodically and considers events or circumstances that may warrant revised estimates of useful lives or that may indicate an impairment. The following table summarizes the Company's intangible assets as of December 31 (in thousands): 2025 2024 Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Intangible Assets Subject to Amortization: Domain Names $ 6,287 $ ( 3,178 ) $ 3,109 $ 6,287 $ ( 2,759 ) $ 3,528 Internal Use Software 14,449 ( 244 ) 14,205 4,304 — 4,304 Total $ 20,736 $ ( 3,422 ) $ 17,314 $ 10,591 $ ( 2,759 ) $ 7,832 Intangible asset amortization expense was $ 0.7 million, $ 0.4 million, and $ 0.4 million for the year ended December 31, 2025, December 31, 2024, and December 31, 2023 . The following table summarizes the expected amortization expense for intangible assets for the years 2026 through 2030 and thereafter (in thousands): 2026 $ 1,678 2027 1,864 2028 1,864 2029 1,864 2030 1,864 Thereafter 8,180 Total $ 17,314 F- 16 Table of Contents 7. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following as of December 31 (in thousands): 2025 2024 Machinery and equipment $ 695,398 $ 573,954 Building and improvements 290,544 152,023 Forklifts and tractors 26,942 24,403 Computer equipment 20,705 18,103 Furniture and fixtures 10,513 9,473 Construction in process 372,287 463,235 Land 31,135 29,976 Total property, plant and equipment 1,447,524 1,271,167 Accumulated depreciation ( 397,791 ) ( 348,299 ) Total property, plant and equipment, net $ 1,049,733 $ 922,868 The Company had construction in process as of December 31, 2025 , of approximately $ 372.3 million. The Company expects that substantially all of the construction in process will be completed and put into service during the year ending December 31, 2026. Depreciation expense for the years ended December 31, 2025 , 2024, and 2023, was $ 62.3 million, $ 54.3 million, and $ 49.8 million, respectively. F- 17 Table of Contents 8. ACCRUED EXPENSES AND OTHER LIABILITIES Accrued expenses and other liabilities consist of the following as of December 31 (in thousands): 2025 2024 Sales and marketing $ 26,866 $ 22,874 Compensation and benefits 21,448 16,132 Operating lease liabilities 12,079 10,800 Capital Projects 3,932 13,274 Income Taxes 3,439 917 Manufacturing costs 2,262 2,904 Other 7,004 5,978 Total accrued expenses and other liabilities $ 77,030 $ 72,879 9. DEBT Revolving Credit Facility Indebtedness prior to October 10, 2024. On May 18, 2022, the Company entered into a Credit Agreement (Credit Agreement) with certain lending parties thereto (Lenders) to amend and restate the Fourth Amended and Restated Credit Agreement dated as of November 5, 2019. Under the Credit Agreement, the Lenders agreed to provide the Company with one or more Revolving Loans in a collective maximum principal amount of $ 400,000,000 (Loan Limit) throughout the term, which ends May 18, 2027 (Term). Included within the Loan Limit are sublimits for a Letter of Credit facility in an amount not to exceed $ 60,000,000 ; and Swing Line Loans in an aggregate principal amount at any time outstanding not to exceed $ 20,000,000 . The Revolving Loans, the Letter of Credit facility and the Swing Line Loans are for the purpose of raising working capital and supporting general business operations. On December 22, 2022, the Company entered into a First Amendment to the Credit Agreement (First Amendment). As a part of the First Amendment, the Credit Agreement was amended and restated to provide for an additional Revolving B Loan (as hereinafter defined). Under the First Amendment, the Lenders agreed to provide the Company with a Revolving B Loan consisting of one or more revolving loans in a collective maximum principal amount of $ 150,000,000 (Revolving B Loan Limit) throughout the term, which ended December 22, 2024 (Revolving B Loan Term). Previously, under the Credit Agreement, there was no Revolving B Loan. The First Amendment also provided that TD Bank, N.A. would serve as Syndication Agent. In conjunction with the First Amendment, on December 22, 2022, the Credit Agreement was amended and restated to refer to the original loan as the Revolving A Loan. The amended and restated Credit Agreement was made an Exhibit A to the First Amendment. All of the terms of the Credit Agreement apply to the Revolving B Loan. The amended Credit Agreement provides the Company, in the aggregate, the ability to borrow an amount up to the Revolving A Loan Limit during the Revolving A Loan Term (which ends May 18, 2027) and Revolving B Loan Limit during the Revolving B Loan Term. The Company is not obligated to borrow any amount under the revolving loans. Within the respective loan limit, the Company may borrow, repay and reborrow at any time or from time to time while the notes issued pursuant to the Credit Agreement are in effect. Base Rate Loans (as defined in the Credit Agreement) under the Revolving A Loan and the Swing Line Loans accrue interest at the Base Rate plus the Applicable Rate (as defined in the Credit Agreement) and Term SOFR Loans for the Revolving Loans accrue interest at the rate per annum equal to the sum of Term SOFR for such interest period plus the Applicable Rate (as defined in the Credit Agreement). The Base Rate for any day is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50 % , (b) the rate of interest in effect for such day as publicly announced from time to time by BOA as its prime rate, and (c) the Term SOFR plus 1.0 % subject to certain interest rate floors. Repayment of all then outstanding principal, interest, fees and costs is due at the end of the Term. With respect to Revolving B Loans (as defined in the First Amendment), for any day, the rate per annum is a tiered pricing based upon the Consolidated Debt to Consolidated EBITDA Ratio. The applicable rate for Revolving B Loans that are Base Rate Loans range between 1.20 % and 2.15 % and the applicable rate for Revolving B Loans that are Term SOFR/Term SOFR Daily Floating Rate range between 0.20 % and 1.15 %. Under the terms of the Security and Pledge Agreement, the Company, subject to certain permitted encumbrances, as collateral security for the above-stated loans and all other present and future indebtedness of the Company owing to the Lenders grants a continuing security interest in certain collateral described and defined in the Security and Pledge Agreement but excluding the Excluded Property (as defined in the Security and Pledge Agreement). F- 18 Table of Contents Indebtedness on and after October 10, 2024. On October 10, 2024, the Company, entered into a Second Amendment to the Credit Agreement (Second Amendment) with certain lending parties thereto (Lenders) to amend that Credit Agreement dated as of May 18, 2022, as amended by that certain First Amendment dated as of December 22, 2022. The Second Amendment provides the Company with Revolving A Loans in the maximum principal amount of $ 400,000,000 (Revolving A Loans), Revolving B Loans in the maximum principal amount of $ 150,000,000 (Revolving B Loans), and Letters of Credit and Swing Line Loans (as defined in the Credit Agreement). The Second Amendment extends the maturity date of the Revolving B Loans from December 22, 2024 to December 22, 2026 . Base Rate Loans (as defined in the Credit Agreement) under the Revolving A Loan and the Swing Line Loans accrue interest at the Base Rate plus the Applicable Rate (as defined in the Credit Agreement) and Term SOFR Loans for the Revolving Loans accrue interest at the rate per annum equal to the sum of Term SOFR for such interest period plus the Applicable Rate (as defined in the Credit Agreement). The Base Rate for any day is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50 % , (b) the rate of interest in effect for such day as publicly announced from time to time by BOA as its prime rate, and (c) the Term SOFR plus 1.0 % subject to certain interest rate floors. Repayment of all then outstanding principal, interest, fees and costs is due at the end of the Term (as defined in the Credit Agreement). With respect to Revolving B Loans (as defined in the Credit Agreement), for any day, the rate per annum is a tiered pricing based upon the Consolidated Debt to Consolidated EBITDA Ratio. The applicable rate for Revolving B Loans that are Base Rate Loans range between 0.20 % and 1.15 %. and the applicable rate for Revolving B Loans that are Term SOFR/Term SOFR Daily Floating Rate range between 1.20 % and 2.15 %. As of December 31, 2025, the Company had $ 133.5 million in borrowings outstanding under its revolving credit facility. The total availability under the revolving credit facility was $ 413.4 million as of December 31, 2025, which reflects a reduction for outstanding letters of credit totaling $ 3.1 million. The weighted average interest rate on the revolving credit facility was 4.62 % as of December 31, 2025. Compliance with Debt Covenants and Restrictions Pursuant to the terms of the Credit Agreement, the Company is subject to certain loan compliance covenants. The Company was in compliance with all covenants as of December 31, 2025 . Failure to comply with the financial covenants could be considered a default of repayment obligations and, among other remedies, could accelerate payment of any amounts outstanding. 10. LEASES For the years ended December 31, 2025, and December 31, 2024 , total operating lease cost was $ 12.0 million and $ 10.4 million, respectively. The weighted average remaining lease term at December 31, 2025 and December 31, 2024 was 6.7 years and 6.3 years, respectively. The weighted average discount rate at December 31, 2025 and December 31, 2024 was 4.70 % and 4.57 %, respectively. The following table includes supplemental cash flow information for the years ended December 31, 2025, December 31, 2024, and December 31, 2023 and supplemental balance sheet information at December 31, 2025 and December 31, 2024 related to operating leases (in thousands): Supplemental Cash Flow Information For the Year Ended December 31, 2025 2024 2023 Cash paid for amounts included in the measurement of operating lease liabilities $ 11,402 $ 10,361 $ 8,176 Operating ROU assets obtained in exchange for lease liabilities $ 10,663 $ 35,704 $ 2,559 Supplemental Balance Sheet Information December 31, 2025 December 31, 2024 Operating lease ROU assets $ 52,632 $ 52,195 Operating lease liabilities: Accrued expenses and other current liabilities $ 12,079 $ 10,800 Operating lease liabilities 41,755 41,979 Total operating lease liabilities $ 53,834 $ 52,779 F- 19 Table of Contents The following table summarizes maturities of operating lease liabilities at December 31, 2025 (in thousands): Maturities of operating lease liabilities 2026 $ 12,369 2027 11,777 2028 10,724 2029 5,420 2030 4,307 Thereafter 19,782 Total lease payments $ 64,379 Less imputed interest ( 10,545 ) Total operating liabilities $ 53,834 11. FINANCIAL INSTRUMENTS The Company considers the recorded value of its financial assets and liabilities, consisting primarily of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities, and debt to approximate the fair value of the respective assets and liabilities on the Consolidated Balance Sheets at December 31, 2025 and 2024. 12. STOCKHOLDERS’ EQUITY Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (in thousands, except share and per share data): Year Ended December 31, 2025 2024 2023 Numerator: Net income $ 190,415 $ 238,446 $ 204,119 Denominator: Basic weighted average shares outstanding 107,010,658 108,191,635 108,680,459 Effect of dilutive securities: Stock appreciation rights 27,053 51,097 71,406 Restricted stock 58,266 79,844 57,538 Diluted weighted average shares outstanding 107,095,977 108,322,576 108,809,403 Basic earnings per share $ 1.78 $ 2.20 $ 1.88 Diluted earnings per share $ 1.78 $ 2.20 $ 1.88 Diluted earnings per share is computed using the weighted average number of shares determined for the basic earnings per share computation plus the dilutive effect of common stock equivalents using the treasury stock method. The computation of diluted earnings per share excludes the following potentially dilutive securities because the effect would be anti-dilutive: Year Ended December 31, 2025 2024 2023 Restricted stock 81,066 35,575 52,323 Stock appreciation rights 145,910 67,017 93,163 Stock Repurchase Program On May 4, 2023, the Trex Board of Directors adopted a new stock repurchase program (2023 Stock Repurchase Program) of up to 10.8 million shares of its outstanding common stock, and terminated the existing stock repurchase program. The 2023 Stock Repurchase Program has no set expiration date. During 2025 and 2024 the Company repurchased 1,526,927 shares and 1,580,640 shares of its common stock under the 2023 Stock Repurchase Program, respectively. F- 20 Table of Contents 13. REVENUE FROM CONTRACTS WITH CUSTOMERS Topic 606 provides a single, comprehensive model for revenue recognition arising from contracts with customers. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and revenue is recognized when or as the Company satisfies the performance obligation. Revenue is recognized at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring control of the goods or services to a customer. Trex principally generates revenue from the manufacture and sale of its high-performance, low-maintenance, eco-friendly wood-alternative composite decking and railing products and accessories. Substantially all of its revenues are from contracts with customers, which are purchase orders of short-term duration of less than one year. Its customers, in turn, sell primarily to the residential market, which includes replacement, remodeling and new construction related to outdoor living products. Trex satisfies its performance obligations at a point in time. The shipment of each product is a separate performance obligation as the customer is able to derive benefit from each product shipped and no performance obligation remains after shipment. Upon shipment of the product, the customer obtains control over the distinct product and Trex satisfies its performance obligation. Any performance obligation that remains unsatisfied at the end of a reporting period is part of a contract that has an original expected duration of one year or less. Any variable consideration related to the unsatisfied performance obligation is allocated wholly to the unsatisfied performance obligation and recognized when the product ships and the performance obligation is satisfied and is included in “Accrued expenses and other liabilities, Sales and marketing” in Note 8 to the Consolidated Financial Statements. For each product shipped, the transaction price by product is specified in the purchase order. The Company recognizes revenue on the transaction price less any amount offered under a sales incentive program. The Company recognizes an account receivable for the amount of revenue recognized as it has an unconditional right to consideration at the time of shipment and payment from the customer is due based solely on the passage of time. The Company receives payments from its customers based on the payment terms applicable to each individual contract and the customer pays in accordance with the billing terms specified in the purchase order, which is less than one year. The related accounts receivables are included in “Accounts receivable, net” in the Consolidated Balance Sheets. Trex may offer various sales incentive programs throughout the year. It estimates the amount of sales incentive to allocate to each performance obligation, or product shipped, based on direct sales to the customer. The estimate is updated each reporting period, and any changes are allocated to the performance obligations on the same basis as at inception. Changes in estimate allocated to a previously satisfied performance obligation are recognized as a reduction of revenue in the period in which the change occurs under the cumulative catch-up method. In addition to sales incentive programs, Trex may offer payment discounts. It estimates the payment discount that it believes will be taken by the customer based on prior history using the most-likely-amount method of estimation. Trex pays commissions to certain employees. However, the sales commissions are not directly attributable to identifiable contracts, are discretionary in nature and are based on other factors not related to obtaining a contract, such as individual performance, profitability of the entity, annual sales targets, etc. These costs are included in selling, general and administrative expenses as incurred. Trex does not grant contractual product return rights to customers other than pursuant to its assurance product warranty (see related disclosure on product warranties in Note 19, “Commitments and Contingencies”). Trex accounts for all shipping and handling fees invoiced to the customer in net sales and the related costs in cost of sales. For each year in the three years ended December 31, 2025 , December 31, 2024, and December 31, 2023 revenue was recognized at a point in time under variable consideration contracts. 14. STOCK-BASED COMPENSATION At the annual meeting of stockholders of the Company held on May 4, 2023, the Company’s stockholders approved the Trex Company, Inc. 2023 Stock Incentive Plan (Plan). The Company’s board of directors unanimously approved the Plan on April 10, 2023, subject to stockholder approval. The Plan amends and restates in its entirety the Trex Company, Inc. 2014 Stock Incentive Plan (2014 Plan), which was last approved by the Company’s stockholders at the annual meeting held on April 30, 2014. The Plan, which will be administered by the compensation committee of the board of directors, provides for the grant of stock options, restricted stock, restricted stock units, stock appreciation rights and unrestricted stock, which are referred to collectively as “awards.” Awards may be granted under the Plan to officers, directors (including non-employee directors) and other employees of the Company or any subsidiary thereof, to any adviser, consultant, or other provider of services to the Company (and any employee thereof), and to any other individuals who are approved by the board of directors as eligible to participate in the Plan. Only employees of the Company or any subsidiary thereof are eligible to receive incentive stock options. Subject to certain adjustments as provided in the Plan, the total aggregate number of shares of common stock that may be granted under the Plan is 4,000,000 shares. As of December 31, 2025 , the total number of shares available for future grants was 3,674,799 . F- 21 Table of Contents The Company recognizes stock-based compensation expense ratably over the period from grant date to the earlier of (1) the vesting date of the award, or (2) the date the grantee is eligible to retire without forfeiting the award. For performance-based restricted stock units, expense is recognized ratably over the performance and vesting period of each tranche based on management’s judgment of the ultimate award that is probable to be paid out based on the achievement of the predetermined performance measures. For the employee stock purchase plan, compensation expense is recognized related to the discount on purchases. The following table summarizes the Company’s stock-based compensation expense (in thousands): Year Ended December 31, 2025 2024 2023 Time-based restricted stock units $ 4,740 $ 5,059 $ 3,897 Performance-based restricted stock units 2,976 5,888 4,836 Stock appreciation rights 1,190 1,359 908 Employee stock purchase plan 209 329 523 Total stock-based compensation $ 9,115 $ 12,635 $ 10,164 Stock-based compensation expense is included in “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. Time-Based Restricted Stock Units The fair value of time-based restricted stock units is determined based on the closing price of Trex shares on the grant date. Time-based restricted stock units vest based on the terms of the awards. Unvested time-based restricted stock units are generally forfeitable upon the resignation of employment or termination of employment with cause. The total fair value of vested time-based restricted stock units granted in the years ended December 31, 2025 , 2024, and 2023 was $ 4.7 million, $ 4.6 million, and $ 4.7 million, respectively. At December 31, 2025 , there was $ 7.2 million of total compensation expense related to unvested time-based restricted stock units remaining to be recognized over a weighted-average period of approximately 2.0 years. Time-based restricted stock unit activity under the Plan and all predecessor stock incentive plans is as follows: Time-based Restricted Stock Unit Weighted- Average Grant Price Per Share Nonvested at December 31, 2022 110,635 $ 61.28 Granted 97,177 $ 58.50 Vested ( 81,080 ) $ 56.52 Forfeited ( 10,228 ) $ 66.19 Nonvested at December 31, 2023 116,504 $ 65.00 Granted 62,348 $ 87.53 Vested ( 64,261 ) $ 71.29 Forfeited ( 396 ) $ 75.72 Nonvested at December 31, 2024 114,195 $ 74.03 Granted 158,202 $ 51.26 Vested ( 64,721 ) $ 71.97 Forfeited ( 15,181 ) $ 70.15 Nonvested at December 31, 2025 192,495 $ 56.54 Performance-based Restricted Stock Units The fair value of performance-based restricted stock units is determined based on the closing price of Trex shares on the grant date. Unvested performance-based restricted stock units are generally forfeitable upon the resignation of employment or termination of employment with cause. The performance-based restricted shares units have a three-year vesting period, vesting one-third each year based on target earnings before interest, taxes, depreciation, and amortization (EBITDA) for 1 year, cumulative 2 years and cumulative 3 years, respectively. The number of shares that will vest, with respect to each vesting, will be between 0 % and 200 % of the target number of shares. At December 31, 2025 , 2024, and 2023 there was $ 2.1 million, $ 3.6 million, $ 4.3 million, respectively, of total compensation expense related to unvested performance-based restricted stock units remaining to be recognized over a weighted-average period of approximately 1.9 years. F- 22 Table of Contents Performance-based restricted stock unit activity under the Plan is as follows: Performance- based Restricted Stock Units Weighted- Average Grant Price Per Share Nonvested at December 31, 2022 71,483 $ 81.57 Granted 96,103 $ 56.79 Vested ( 30,038 ) $ 66.26 Forfeited ( 28,163 ) $ 74.39 Nonvested at December 31, 2023 109,385 $ 65.92 Granted 80,159 $ 81.23 Vested ( 67,710 ) $ 63.83 Forfeited ( 13,390 ) $ 104.56 Nonvested at December 31, 2024 108,444 $ 75.57 Granted 102,049 $ 64.85 Vested ( 65,304 ) $ 66.83 Forfeited ( 25,715 ) $ 77.86 Nonvested at December 31, 2025 119,474 $ 70.71 Stock Appreciation Rights SARs are granted with a grant price equal to the closing market price of the Company’s common stock on the date of grant. These awards expire ten years after the date of grant and vest based on the terms of the individual awards. The SARs are generally forfeitable upon the resignation of employment or termination of employment with cause. The Company recognizes forfeitures as they occur. The Company recognizes compensation cost on a straight-line basis over the vesting period for the award. As of December 31, 2025 , there was $ 1.5 million of unrecognized compensation cost related to SARs. The fair value of each SAR is estimated on the date of grant using a Black-Scholes option-pricing model . For SARs issued in the years ended December 31, 2025, December 31, 2024, and December 31, 2023, respectively, the assumptions shown in the following table were used: Year Ended December 31, 2025 2024 2023 Dividend yield 0 % 0 % 0 % Average risk-free interest rate 4.3 % 4.3 % 4.0 % Expected term (years) 5 5 5 Expected volatility 51.4 % 51.2 % 49.5 % Dividend Yield. Trex has never paid cash dividends on its common stock. Average Risk-Free Interest Rate. The Company uses the U.S. Treasury rate having a term that most closely resembles the expected term of the option. Expected Term. The expected term is the period of time that the SARs granted are expected to remain unexercised. SARs granted during the years ended December 31, 2025, December 31, 2024, and December 31, 2023 , had a maximum term of ten years . The Company used historical exercise behavior with further consideration given to the class of employees to whom the equity awards were granted to estimate the expected term of the SAR. Expected Volatility. Volatility is a measure of the amount by which a financial variable such as a share price has fluctuated (historical volatility) or is expected to fluctuate (expected volatility) during a period. The Company has used the historical volatility over the average expected term of the options granted as the expected volatility. The weighted-average grant date fair value of SARs granted during the years ended December 31, 2025, December 31, 2024, and December 31, 2023 , was $ 33.06 , $ 44.83 , and $ 27.19 , respectively. F- 23 Table of Contents SAR activity under the Plan and all predecessor stock incentive plans is as follows: SARs Weighted- Average Grant Price Per Share Weighted- Average Remaining Contractual Life (Years) Aggregate Intrinsic Value as of December 31, 2025 Outstanding at December 31, 2022 233,969 $ 40.64 Granted 51,916 $ 56.80 Exercised ( 53,036 ) $ 11.95 Canceled ( 12,969 ) $ 75.25 Outstanding at December 31, 2023 219,880 $ 49.34 Granted 33,277 $ 90.86 Exercised ( 58,767 ) $ 35.77 Canceled ( 4,142 ) $ 89.99 Outstanding at December 31, 2024 190,248 $ 59.91 Granted 46,126 $ 66.67 Exercised ( 6,702 ) $ 48.06 Canceled ( 16,246 ) $ 79.12 Outstanding at December 31, 2025 213,426 $ 60.28 5.8 $ 402,518 Vested at December 31, 2025 141,911 $ 55.10 4.6 $ 402,518 Exercisable at December 31, 2025 141,911 $ 55.10 4.6 $ 402,518 Employee Stock Purchase Plan The Company has an employee stock purchase plan (ESPP) that permits eligible employees to purchase shares of common stock of the Company at a purchase price which is the lesser of 85 % of the market price on either the first day of the calendar quarter or the last day of the calendar quarter. Eligible employees may elect to participate in the plan by authorizing payroll deductions of up to 15 % of gross compensation for each payroll period. On the last day of each quarter, each participant’s contribution account is used to purchase the maximum number of whole shares of common stock determined by dividing the contribution account balance by the purchase price. The aggregate number of shares of common stock that may be purchased under the plan is 2,400,000 . Through December 31, 2025 , employees had purchased approximately 1,947,259 shares under the plan. 15. EMPLOYEE BENEFIT PLANS At December 31, 2025 the Company has a 401(k) Profit Sharing Plan for the benefit of its employees who meet certain eligibility requirements and it matches qualifying employee contributions. The Company’s contributions to the plans totaled $ 8.6 million, $ 8.6 million, and $ 6.8 million, for the years ended December 31, 2025 , 2024, and 2023, respectively. 16. INCOME TAXES Income tax provision (benefit) consists of the following (in thousands): Year Ended December 31, 2025 2024 2023 Current income tax provision: Federal $ 35,261 $ 75,552 $ 52,634 State 15,171 20,147 13,966 50,432 95,699 66,600 Deferred income tax provision: Federal 16,638 ( 11,113 ) 2,633 State 476 ( 1,118 ) 1,235 17,114 ( 12,231 ) 3,868 Total income tax provision $ 67,546 $ 83,468 $ 70,468 The income tax provision differs from the amount of income tax determined by applying the U.S. Federal statutory rate to income before taxes as a result of the following (in thousands): F- 24 Table of Contents Year Ended December 31, 2025 2024 2023 $ % $ % $ % U.S. federal statutory taxes $ 54,172 21.0 % $ 67,602 21.0 % $ 57,664 21.0 % State and local taxes, net of U.S. federal income tax effect (a) 11,668 4.5 % 14,658 4.5 % 12,287 4.5 % Foreign tax effects — 0.0 % — 0.0 % — 0.0 % Effect of changes in tax laws or rates enacted in the current period ( 155 ) 0.0 % ( 30 ) 0.0 % ( 77 ) 0.0 % Effects of cross-border tax laws Foreign-derived intangible income ( 501 ) - 0.2 % ( 1,373 ) - 0.4 % ( 831 ) - 0.3 % Tax credits Research and development ( 433 ) - 0.2 % ( 444 ) - 0.2 % ( 484 ) - 0.2 % Energy related tax credits — 0.0 % — 0.0 % ( 109 ) 0.0 % Other ( 179 ) 0.0 % ( 192 ) - 0.1 % ( 162 ) - 0.1 % Changes in valuation allowances ( 443 ) - 0.2 % ( 668 ) - 0.2 % 411 0.1 % Nontaxable or nondeductible items Share-based payment awards 100 0.0 % ( 756 ) - 0.3 % ( 656 ) - 0.2 % Other 2,472 1.0 % 2,321 0.8 % 2,151 0.8 % Changes in unrecognized tax benefits — 0.0 % — 0.0 % — 0.0 % Other adjustments 845 0.3 % 2,350 0.8 % 274 0.1 % Effective tax rate $ 67,546 26.2 % $ 83,468 25.9 % $ 70,468 25.7 % (a) State Taxes in California, Illinois, Maryland, Massachusetts, Michigan, New Jersey, and Pennsylvania made up the majority (greater than 50 % of the tax in this category). The Company’s effective tax rate for the year ended December 31, 2025 , was 26.2 % and was comparable to the effective tax rate for the year ended December 31, 2024 , of 25.9 %, which resulted in income tax expense of $ 67.5 million and $ 83.5 million, respectively. Taxes paid consist of the following (in thousands): As of December 31, 2025 2024 2023 Federal 34,027 66,859 40,389 State * 16,029 18,312 11,951 Foreign - - - Total Taxes Paid 50,056 85,171 52,340 * No jurisdictions were paid in excess of 5 percent of total income taxes paid (net of refunds) . Deferred tax assets and liabilities consist of the following (in thousands): F- 25 Table of Contents As of December 31, 2025 2024 Deferred tax assets: Operating lease liability 13,898 13,632 Product warranty reserves 7,591 5,833 State tax credit carryforwards 2,910 3,621 Deferred revenue 4,227 4,230 Tax Cut and Jobs Act capitalization of research and development costs 8 5,397 Stock-based compensation 2,030 1,828 Inventories 8,882 3,342 Gross deferred tax assets, before valuation allowance 39,546 37,883 Valuation allowance ( 2,196 ) ( 2,638 ) Gross deferred tax assets, after valuation allowance 37,350 35,245 Deferred tax liabilities: Depreciation ( 93,274 ) ( 70,572 ) Inventories ( 11,249 ) ( 14,837 ) Operating lease right-of-use asset ( 13,433 ) ( 13,332 ) Goodwill amortization ( 3,616 ) ( 3,584 ) Other ( 1,611 ) ( 1,639 ) Gross deferred tax liabilities ( 123,183 ) ( 103,964 ) Net deferred tax liability $ ( 85,833 ) $ ( 68,719 ) The Company recognizes deferred tax assets and liabilities based on the difference between the financial statement basis and tax basis of assets and liabilities using enacted tax laws and statutory tax rates. In accordance with accounting standards, the Company assesses the likelihood that its deferred tax assets will be realized. Deferred tax assets are reduced by a valuation allowance when, after considering all available positive and negative evidence, it is determined that it is more likely than not that some portion, or all, of the deferred tax asset will not be realized, primarily certain state income tax credits. As of December 31, 2025 , the Company had a valuation allowance of $ 2.2 million against deferred tax assets it estimates will not be realized. The Company will analyze its position in subsequent reporting periods, considering all available positive and negative evidence, in determining the expected realization of its deferred tax assets. The Company recognizes interest and penalties related to tax matters as a component of “Selling, general and administrative expenses” in the accompanying Consolidated Statements of Comprehensive Income. As of December 31, 2025 , the Company has identified no uncertain tax position and, accordingly, has no t recorded any unrecognized tax benefits or associated interest and penalties. The Company operates in multiple tax jurisdictions and, in the normal course of business, its tax returns are subject to examination by various taxing authorities. Such examinations may result in future assessments by these taxing authorities, and the Company has accrued a liability when it believes that it is not more likely than not that it will realize the benefits of tax positions that it has taken or for the amount of any tax benefit that exceeds the cumulative probability threshold in accordance with accounting standards. As of December 31, 2025, for certain tax jurisdictions, tax years 2021 through 2025 r emain subject to examination. The Company believes that adequate provisions have been made for all tax returns subject to examination. Sales made to foreign distributors are not taxable in any foreign jurisdictions as the Company does not have a taxable presence. 17. SEGMENT INFORMATION The Company operates in one reportable segment, with resource allocation and assessment of financial performance based on a consolidated basis. Trex manufactures composite decking and railing and related outdoor living products marketed under the brand name Trex®. The products are sold to its distributors and two national retailers who, in turn, sell primarily to the residential market, which includes replacement, remodeling and new construction. F- 26 Table of Contents The Company’s reportable segments are determined in accordance with its internal management structure, which is based on operations. The Company has identified its President and Chief Executive Officer as the Chief Operating Decision Maker (CODM). The Company’s CODM has final authority over resource allocation decisions and performance assessments and makes key operating decisions. The primary objective of the CODM is to optimize positive Company-wide performance and financial results. The CODM evaluates segment performance primarily based on net income and net sales. The CODM uses net income to assess performance and allocate resources as this measure provides insight into all aspects of the segment’s operations and overall success of the segment for a given period. The CODM also uses net sales to assess performance and allocate resources as this measure represents the amount of business the segment engaged in during a given period of time, is an indicator of market growth and acceptance of segment products, and represents the segment’s customers’ spending habits along with the amount of product the segment sells relative to its competitors. In addition, the CODM reviews significant segment expenses with a primary focus on cost of sales and total selling, general, and administrative expenses. These measures are provided in the accompanying Consolidated Statements of Comprehensive Income. Segment assets are reported on the Consolidated Balance Sheets. 18. SEASONALITY The operating results for Trex have historically varied from quarter to quarter. Seasonal, erratic, or prolonged adverse weather conditions may reduce the level of home improvement and construction activity and can shift demand for its products to a later period. As part of its normal business practice and consistent with industry practice, Trex has historically offered incentive programs to its distributors and dealers to build inventory levels before the start of the prime deck-building season in order to ensure adequate availability of its product to meet anticipated seasonal consumer demand. The seasonal effects are often offset by the positive effect of the incentive programs. 19. COMMITMENTS AND CONTINGENCIES Legal Matters The Company has lawsuits, as well as other claims, pending against it which are ordinary routine litigation and claims incidental to the business. Management has evaluated the merits of these lawsuits and claims and believes that their ultimate resolution will not have a material effect on the Company’s consolidated financial condition, results of operations, liquidity, or competitive position. Purchase Commitments The Company fulfills requirements for raw materials under both purchase orders and supply contracts. In the year ended December 31, 2025, the Company purchased reclaimed wood fiber requirements under purchase orders and long-term supply commitments. All of the Company’s scrap polyethylene, aluminum and stainless-steel purchases are under short-term supply contracts that average approximately one year, for which pricing is negotiated as needed, or under purchase orders that do not involve long-term supply commitments. The wood and polyethylene supply contracts generally provide that the Company is obligated to purchase all wood or polyethylene a supplier provides, if the wood or polyethylene meets certain specifications. The amount of wood and polyethylene the Company is required to purchase under these contracts varies with the production of its suppliers and, accordingly, is not fixed or determinable. As of December 31, 2025 , the Company has purchase commitments under material supply contracts of $ 25.9 million for the year ending December 31, 2026, and a total of $ 34.3 million for the years ending December 31, 2027 through 2028. Our purchase commitments do not currently extend beyond 2028. Product Warranty The Company warrants that for the applicable warranty period its Trex products, when properly installed, used and maintained, will be free from material defects in workmanship and materials and its decking, cladding, fascia and railing products will not split, splinter, rot or suffer structural damage from termites or fungal decay. Products sold on or after January 1, 2023: The warranty period for residential use is 50 years for Transcend ® decking, 35 years for Select ® decking and Universal Fascia, and 25 years for Enhance ® decking and Transcend, Select, Enhance and Signature ® railing. The warranty period for commercial use is 10 years, excluding Signature railing and Transcend cladding, which each have a warranty period of 25 years. The Company further warrants that Trex Transcend, Trex Enhance and Trex Select decking and cladding and Universal Fascia products will not fade in color from light and weathering exposure more than a certain amount and will be resistant to permanent staining from food and beverage substances or mold and mildew, provided the stain is cleaned within seven days of appearance, for the warranty period referred to above. If there is a breach of such warranties, the Company has an obligation either to replace the defective product or refund the purchase price. Products sold prior to January 1, 2023: The warranty period is 25 years for residential use and 10 years for commercial use. With respect to Trex Signature railing, the warranty period is 25 years for both residential and commercial use. The Company further warrants that Trex Transcend, Trex Enhance, Trex Select and Universal Fascia products will not fade in color more than a certain F- 27 Table of Contents amount and will be resistant to permanent staining from food substances or mold, provided the stain is cleaned within seven days of appearance, for the warranty period referred to above. If there is a breach of such warranties, the Company has an obligation either to replace the defective product or refund the purchase price. The Company maintains a warranty reserve for the settlement of its product warranty claims. The Company accrues for the estimated cost of product warranty claims at the time revenue is recognized based on such factors as historical claims experience and future claims experience. To estimate our future claims experience, the Company utilizes actuarial techniques to determine a reasonable possible range of amounts to be paid related to defects covered by our product warranty. The actuarial techniques consider claims received, claims closed, and the corresponding amounts paid. Estimates for these elements are quantified using a range of assumptions derived from claim history and consideration of additional factors influencing claim counts or costs incurred to settle claims in order determine the best estimate of future claims for which to record a related liability. Management reviews and adjusts these estimates, if necessary, based on the differences between actual experience and historical estimates. The Company monitors claims activity each quarter for indications that its estimates require revision. The Company uses the best and most complete underlying information available and a rational methodology to determine its warranty obligations. The Company considers all available evidence to assess the reasonableness of all key assumptions underlying its estimated warranty obligations. During the fourth quarter of 2025, the Company utilized an actuary for the first time to review data on its product warranty. This resulted in a change to the methodology in which the Company estimated its product warranty liability. The reserve increased during the period, largely due to the refined methodology, which decreased the Company’s income before income taxes by $ 6.0 million, decreased net income by $ 4.4 million, and reduced diluted earnings per share by $ 0.04 . The Company’s analysis is based on currently known facts and a number of assumptions, as discussed above, and current expectations. Projecting future events such as the number of claims to be received, the number of claims that will require payment and the costs associated with settling claims could cause the actual warranty liability to be higher or lower than projected, which could materially affect the Company’s financial condition, results of operations or cash flows. The Company estimates that a 10 % change in the expected future claims activity may result in approximately a $ 3.0 million change in the estimate of its product warranty reserve. The Trex product warranty reserve activity consisted of the following, and is included in Accrued warranty and Non-current accrued warranty in the Consolidated Balance Sheets (in thousands): Year Ended December 31, 2025 Trex Product Warranty Beginning balance, January 1 $ 22,835 Provisions and changes in estimates 14,954 Settlements made during the period ( 8,049 ) Ending balance, December 31 $ 29,740 Year Ended December 31, 2024 Trex Product Warranty Beginning balance, January 1 $ 22,178 Provisions and changes in estimates 9,725 Settlements made during the period ( 9,068 ) Ending balance, December 31 $ 22,835 As of December 31, 2025 the Company's reserve of $ 29.7 million is within the estimated range of possible loss associated with product warranty claims. The Company’s estimate of the range of possible loss for product warranty claims associated with product sold through December 31, 2025 is between $ 24.8 million and $ 45.6 million. The company utilized an actuary in calculating a range of possible loss for product warranty claims. Actual experience could exceed the range due to uncertainty associated with the future number of claims expected to be closed with some payment and estimates of the costs associated with servicing those claims. Industrial Revenue Bonds In October 2021, the Company announced plans to add a third manufacturing facility located in Little Rock, Arkansas (Little Rock). Construction on the new facility began in the second quarter of 2022. In connection with the construction of the new facility, F- 28 Table of Contents during 2024 the Company and Little Rock entered into an agreement in which Little Rock agreed to issue up to $ 450 million of its industrial revenue bonds (IRBs) for the purpose of constructing a manufacturing facility. Under the agreement, the Company transferred ownership of the facility to Little Rock and simultaneously leased the related asset from Little Rock. The Company is also the purchaser of the IRBs and, therefore, is the bondholder as well as the borrower/lessee of the Little Rock facility purchased with the IRB proceeds. As a result of the agreement, the Company was able to reduce the cost of certain state and local tax expenditures for twenty years. The Company has a purchase option included in the lease agreement for below the fair value of the asset, which prevents the transfer of the asset to Little Rock from being recognized as a sale. Furthermore, the Company has not derecognized the transferred asset and continues to recognize it in property, plant and equipment in the Consolidated Balance Sheets. The Company has the right and intends to set-off any obligations to make payments under the finance liability, with proceeds due from the IRBs. The liability and IRB asset are equal and are reported net in the Consolidated Balance Sheets. As of December 31, 2025, the gross asset and liability associated with the IRBs was $ 450 million. F- 29 Table of Contents TREX COMPANY, INC. SCHEDULE II—VALUATI ON AND QUALIFYING ACCOUNTS AND RESERVES (In thousands) Descriptions Balance at Beginning of Period Additions Charged to Cost and Expenses Deductions Balance at End of Period Year ended December 31, 2025: Trex product warranty reserve $ 22,835 $ 14,954 $ ( 8,049 ) $ 29,740 Income tax valuation allowance $ 2,638 $ ( 442 ) $ — $ 2,196 Year ended December 31, 2024: Trex product warranty reserve $ 22,178 $ 9,725 $ ( 9,068 ) $ 22,835 Income tax valuation allowance $ 3,307 $ ( 669 ) $ — $ 2,638 Year ended December 31, 2023: Trex product warranty reserve $ 25,599 $ 3,508 $ ( 6,929 ) $ 22,178 Income tax valuation allowance $ 3,026 $ 281 $ — $ 3,307 F- 30