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What changed in Arcosa, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Arcosa, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+375 added−365 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-23)

Top changes in Arcosa, Inc.'s 2024 10-K

375 paragraphs added · 365 removed · 310 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

72 edited+13 added−12 removed42 unchanged
Biggest changeWe have two manufacturing plants in the U.S. dedicated to concrete structures, including a new plant in Florida that was completed in December 2023. • Wind Towers: We are one of the leading manufacturers of structural wind towers in the U.S. and Mexico with three manufacturing plants strategically located in wind-rich regions of North America.
Biggest changeWe have two manufacturing plants in the U.S. dedicated to concrete structures, including a new plant in Florida that was completed in December 2023. • Wind Towers: We are one of the leading manufacturers of structural wind towers in the U.S. and Mexico with four manufacturing plants strategically located in wind-rich regions of North America, including a new wind tower plant in New Mexico that began delivering towers late in the second quarter of 2024 to support the growing wind investment in the Southwest. • Traffic and Lighting Structures: We manufacture steel and concrete poles and structures for a broad range of transportation and lighting applications.
Recycled aggregates are a complement to our natural aggregates platform and are produced by crushing concrete reclaimed from demolished highways, buildings, and other structures. The raw product material is processed to remove debris, primarily rebar, and screened to appropriate sizes for use as a road base, erosion control, building foundations, and as a backfill for utility trenches.
Recycled aggregates are a complement to our natural aggregates platform and are produced by crushing concrete reclaimed from demolished highways, buildings, and other structures. The raw concrete product material is processed to remove debris, primarily rebar, and screened to appropriate sizes for use as a road base, erosion control, building foundations, and as a backfill for utility trenches.
Most of this funding is apportioned to states, based on formulas specified in the IIJA and provides funding through a wide range of competitive grant programs. • Residential Construction: Residential construction includes single family homes and multi-family units such as apartments and condominiums.
Most of this funding is apportioned to states, based on formulas specified in the IIJA and provides funding through a wide range of competitive grant programs. • Residential Construction: Includes single family homes and multi-family units such as apartments and condominiums.
Approximately 40% of the hopper fleet and 25% of the tank fleet are more than 20 years old. The replacement of these fleets is expected to drive healthy demand based on an assumed 25 to 30-year useful life.
Approximately 40% of the hopper fleet and 30% of the tank fleet are more than 20 years old. The replacement of these fleets is expected to drive healthy demand based on an assumed 25 to 30-year useful life.
Accordingly, we cannot assure that environmental requirements will not change or become more stringent over time or that our eventual environmental costs and liabilities will not be material. Certain environmental laws assess liability on current or previous owners or operators of real property for the cost of removal or remediation of hazardous substances.
Accordingly, we cannot assure that environmental requirements will not change or become more stringent over time or that our eventual environmental costs and liabilities will not be material. Certain environmental laws assess liability on current and previous owners or operators of real property for the cost of removal and remediation of hazardous substances.
We have an environmental management structure designed to facilitate and support our compliance with these requirements globally. Although it is our intent to comply with all such requirements and regulations, we cannot provide assurance that we are at all times in compliance. Environmental requirements are complex, change frequently, and have tended to become more stringent over time.
We have an environmental management structure designed to facilitate and support our compliance with these requirements globally. Although it is our intent to comply with all such requirements and regulations, we cannot provide assurance that we are at all times in compliance. Environmental requirements are complex, change frequently, and generally have tended to become more stringent over time.
We currently estimate that we have 1.2 billion tons of proven and probable natural aggregates and specialty materials reserves strategically located in favorable markets that are expected to require large amounts of aggregates to meet future construction demand. For further discussion of our natural aggregates and specialty materials reserves, please refer to Item 2.
We currently estimate that we have 1.4 billion tons of proven and probable natural aggregates and specialty materials reserves strategically located in favorable markets that are expected to require large amounts of aggregates to meet future construction demand. For further discussion of our natural aggregates and specialty materials reserves, please refer to Item 2.
For additional information regarding revenues, operating profit, and identifiable assets by segment, please refer to Note 4 to the Consolidated Financial Statements. Construction Products. Products Through wholly owned subsidiaries, our Construction Products segment produces and sells natural and recycled aggregates, specialty materials, and construction site support equipment, including trench shields and shoring products. See Item 7.
For additional information regarding revenues, operating profit, and identifiable assets by segment, please refer to Note 4 to the Consolidated Financial Statements. Construction Products. Products Through wholly owned subsidiaries, our Construction Products segment produces and sells natural and recycled aggregates, specialty materials, asphalt mix, and construction site support equipment, including trench shields and shoring products. See Item 7.
“ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” for revenues attributable to aggregates and specialty materials, and construction site support. • Natural Aggregates: We are an established producer and distributor of natural aggregates serving both public infrastructure and private construction markets and operate in Texas, our largest geographic exposure, and eight other states.
“ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” for revenues attributable to aggregates and specialty materials, and construction site support. • Natural Aggregates: We are an established producer and distributor of natural aggregates serving both public infrastructure and private construction markets and operate in Texas, our largest geographic exposure, and nine other states.
Products Through wholly owned subsidiaries, our Engineered Structures segment primarily manufactures and sells steel structures for infrastructure businesses, including utility structures for electricity transmission and distribution, structural wind towers, traffic structures, and telecommunication structures. These products share similar manufacturing competencies and steel sourcing requirements and can be manufactured across our North American footprint.
Products Through wholly owned subsidiaries, our Engineered Structures segment primarily manufactures and sells steel and concrete structures for infrastructure businesses, including utility structures for electricity transmission and distribution, structural wind towers, traffic and lighting structures, and telecommunication structures. These products share similar manufacturing competencies and steel sourcing requirements and can be manufactured across our North American footprint.
Despite recent declines, the dry and liquid barge replacement cycles are expected to remain fundamentally strong as investments in the aging barge fleet over the last 5 to 6 years have been below long-term average replacement rates (with the exception of 2019 for liquid barges).
Despite recent declines in new barge building, the dry and liquid barge replacement cycles are expected to remain fundamentally strong as investments in the aging barge fleet over the last 5 to 6 years have been below long-term average replacement rates (with the exception of 2019 for liquid barges).
Demand for residential construction is influenced primarily by population growth, new household formation, and mortgage interest rates. • Non-Residential Construction: Non-residential construction includes a wide variety of privately financed construction, including manufacturing and distribution facilities, industrial complexes, office buildings, and large retailers and wholesalers.
Demand for residential construction is influenced primarily by population growth, new household formation, and mortgage interest rates. • Non-Residential Construction: Includes a wide variety of privately financed construction, including manufacturing and distribution facilities, data centers, industrial complexes, office buildings, and large retailers and wholesalers.
Upgrades to utility structures are needed to support larger equipment that is required to withstand growing load demand and to allow for connectivity of the grid to renewable energy sources. The IIJA authorized $73 billion in additional federal funding to support the investment needed in the U.S. power grid.
Upgrades to utility structures are needed to support larger equipment that is required to withstand growing load demand from increased electrification and to allow for connectivity of the grid to renewable energy sources. The IIJA authorized $73 billion in additional federal funding to support the investment needed in the U.S. power grid.
Stevenson was the Vice President, Associate General Counsel and Corporate Secretary for Trinity. Prior to joining Trinity, Mr. Stevenson was Vice President, General Counsel and Secretary for CarParts, Inc. (formerly known as U.S. Auto Parts Network, Inc.), an online provider of automotive parts, from 2011 to 2015. Eric D.
Stevenson was the Vice President, Associate General Counsel and Corporate Secretary for Trinity. Prior to joining Trinity, Mr. Stevenson was Vice President, General Counsel and Secretary for CarParts, Inc. (formerly known as U.S. Auto Parts Network, Inc.), an online provider of automotive parts, from 2011 to 2015. 13 Table of Contents Eric D.
The following table sets forth the names and ages of all our executive officers, their positions and offices presently held by them, and the year each person first became an officer. Name Age Office Officer Since Antonio Carrillo 57 President and Chief Executive Officer 2018 Gail M. Peck 56 Chief Financial Officer 2018 Reid S.
Information About Our Executive Officers. The following table sets forth the names and ages of all our executive officers, their positions and offices presently held by them, and the year each person first became an officer. Name Age Office Officer Since Antonio Carrillo 58 President and Chief Executive Officer 2018 Gail M. Peck 57 Chief Financial Officer 2018 Reid S.
In certain markets, we are paid a fee to accept raw product. Our competitive advantages include our operating permits, which allow recycling activities, and the strategic location of our stationary crushing sites. Engineered Structures.
In certain markets, we are paid a fee to accept raw product. Our competitive advantages include our operating permits, which allow recycling activities, and the strategic location of our stationary crushing sites. 7 Table of Contents Engineered Structures.
We also sell into the competitive-bid market, whereby the lowest bidder is awarded the contract, provided all other qualifying criteria are met. Within our wind towers business, our primary customers are wind turbine producers. We compete with both domestic and foreign producers of towers.
We also sell into the competitive-bid market, whereby the lowest bidder is awarded the contract, provided all other qualifying criteria are met. Within our wind towers business, our primary customers are wind turbine producers. We compete with both domestic and foreign producers of towers. Revenues from GE Vernova, Inc.
Recycled aggregates are a substitute to natural aggregates, primarily for hard rock uses. • Specialty Materials: Our specialty materials, including lightweight aggregates, select natural aggregates, and milled or processed specialty building products and agricultural products, are produced and distributed nationwide.
Recycled aggregates are a substitute to natural aggregates, primarily for hard rock uses. 5 Table of Contents • Specialty Materials: Our specialty materials, including lightweight aggregates, select natural aggregates, and milled or processed specialty building products and agricultural products, are produced and distributed nationwide.
Customers and Competitors For natural and recycled aggregates and specialty materials, our customers include concrete producers; commercial, residential, highway, and general contractors; manufacturers of masonry and building products; and state and local governments.
Customers and Competitors For natural and recycled aggregates and specialty materials, our customers include concrete and asphalt producers; commercial, residential, highway, and general contractors; manufacturers of masonry and building products; and state and local governments. For asphalt, our customers primarily include contractors and local/state road departments.
Markets Over a multi-year period, we believe that approximately half of our current portfolio of construction materials are used in infrastructure projects and the other half is split across residential, non-residential, and specialty/other end markets. 5 Table of Contents • Infrastructure Construction: Infrastructure construction includes construction spending by federal, state, and local governments for roads, highways, bridges, airports, and other public infrastructure, as well as private spending on road and utility construction.
Markets Over a multi-year period, we believe that approximately 40% of our current portfolio of construction materials are used in infrastructure projects with the remainder split across non-residential, residential, and specialty/other end markets. • Infrastructure Construction: Includes construction spending by federal, state, and local governments for roads, highways, bridges, airports, and other public infrastructure, as well as private spending on road and utility construction.
Population and household formation growth have contributed to a strong residential housing market in recent years, however, the recent rise in interest rates has caused a near term slow down, with housing permits, an indication of future construction activity, down approximately 13% in Texas in 2023 compared to the previous year.
Population and household formation growth contributed to a strong residential housing market prior to 2022, however, the rise in interest rates in recent years has caused a near term slow down, with housing permits, an indication of future construction activity, down approximately 3% in Texas in 2024 compared to the previous year.
We manage the business from the four regions of Texas, the Ohio River Valley, the Gulf Coast, and the West. We operate primarily from open pit quarries and have one underground mine.
We manage the business from the four regions of Texas, the East, the Gulf Coast, and the West. We operate primarily from open pit quarries and have one underground mine.
Hurst worked in the audit practice of Ernst & Young. 13 Table of Contents
Hurst worked in the audit practice of Ernst & Young. 14 Table of Contents
As part of the Company’s effort to attract and motivate employees, Arcosa offers competitive compensation and benefits, including healthcare and retirement benefits, parental and family leave, and holiday and paid time off. Launched in September 2022, Arcosa's LEAD: Leadership Exploration and Development cohort continued its development track in 2023.
As part of the Company’s effort to attract and motivate employees, Arcosa offers competitive compensation and benefits, including healthcare and retirement benefits, parental and family leave, and holiday and paid time off. Launched in September 2022, Arcosa's LEAD: Leadership Exploration and Development cohort began its second iteration in 2024.
Food and Drug Administration (“FDA”). Engineered Structures. Arcosa’s Engineered Structures segment is subject to the regulations of various state departments of transportation. These agencies promulgate and enforce rules and regulations pertaining, in part, to the manufacture of traffic structures. Transportation Products. The primary regulatory and industry authorities involved in the regulation of the inland barge industry are the U.S.
Arcosa’s Engineered Structures segment is subject to the regulations of various state departments of transportation. These agencies promulgate and enforce rules and regulations pertaining, in part, to the manufacture of traffic and lighting structures. Transportation Products. The primary regulatory and industry authorities involved in the regulation of the inland barge industry are the U.S. Coast Guard, the U.S.
The outlook for construction spending in Texas is favorable with 2024 fiscal year planned Texas Department of Transportation (“TxDOT”) lettings of approximately $13 billion. The TxDOT annual update to its 10-year Unified Transportation Program ("UTP") approved in 2023 identified a record $100 billion of infrastructure projects, an increase of $15 billion from the prior year's UTP update.
The outlook for construction spending in Texas is favorable with 2024 fiscal year planned Texas Department of Transportation (“TxDOT”) lettings of approximately $12.5 billion. The TxDOT annual update to its 10-year Unified Transportation Program ("UTP") approved in 2024 identified a record $104 billion of infrastructure projects, a 4% increase from the prior year's UTP update.
Recycled aggregates currently supply a small percentage of total aggregates supplied nationwide. We believe the use of recycled aggregates will continue to grow due to resource scarcity and associated sustainability benefits, reduced disposal and acceptance of concrete in landfills, and energy savings from less processing and transportation costs.
We believe the use of recycled aggregates will continue to grow due to resource scarcity and associated sustainability benefits, reduced disposal and acceptance of concrete in landfills, and energy savings from less processing and transportation costs.
Natural aggregates and specialty materials can be found throughout the U.S. We have a proven and successful record of securing long-term reserve positions for both current and future mine locations through our employment of exploration teams and the use of professional third parties. Our reserves are critical to our raw material supply and long-term success.
We have a proven and successful record of securing long-term reserve positions for both current and future mine locations through our employment of exploration teams and the use of professional third parties. Our reserves are critical to our raw material supply and long-term success.
Demand for non-residential construction is driven primarily by population and economic growth, in addition to segment-specific factors such as the growth of e-commerce, changes in retail patterns, changes in office occupancy trends, financing costs and numerous other factors. • Specialty/Other: Our products are used in various other end markets including energy-related activities, such as drilling pads, roads and major downstream projects, agriculture/horticulture, and industrial uses.
Demand for non-residential construction is driven primarily by population and economic growth, in addition to segment-specific factors such as the growth of e-commerce and artificial intelligence, changes in retail patterns, changes in office occupancy trends, financing costs, and numerous other factors. • Specialty/Other: Our products are used in various other end markets including energy-related activities, such as drilling pads, roads and major downstream projects, agriculture/horticulture, and industrial uses. 6 Table of Contents In 2024, we had shipments of approximately 38 million tons of aggregates and specialty materials, including approximately 5 million tons of recycled aggregates.
Essl 42 Group President 2018 Kerry S. Cole 55 Group President 2018 Jesse E. Collins, Jr. 57 Group President 2018 Bryan P. Stevenson 50 Chief Legal Officer 2018 Eric D. Hurst 40 Vice President, Controller 2023 Antonio Carrillo serves as Arcosa’s President and Chief Executive Officer, as well as a member of Arcosa's Board of Directors.
Essl 43 Group President 2018 Kerry S. Cole 56 Group President 2018 Jesse E. Collins, Jr. 58 Group President 2018 Bryan P. Stevenson 52 Chief Legal Officer 2018 Eric D. Hurst 41 Vice President, Controller 2023 Antonio Carrillo serves as Arcosa’s President and Chief Executive Officer, as well as a member of Arcosa's Board of Directors (the "Board").
As of December 31, 2023 and 2022, our backlog of firm orders was as follows: December 31, 2023 December 31, 2022 (in millions) Engineered Structures: Utility, wind, and related structures $ 1,367.5 $ 671.3 Transportation Products: Inland barges $ 253.7 $ 225.1 Approximately 43% of the unsatisfied performance obligations for our utility, wind, and related structures in our Engineered Structures segment is expected to be delivered during 2024, approximately 27% is expected to be delivered during 2025, and the remainder is expected to be delivered through 2028.
As of December 31, 2024 and 2023, our backlog of firm orders was as follows: December 31, 2024 December 31, 2023 (in millions) Engineered Structures: Utility, wind, and related structures $ 1,190.8 $ 1,367.5 Transportation Products: Inland barges $ 280.1 $ 253.7 Approximately 64% of the unsatisfied performance obligations for our utility, wind, and related structures in our Engineered Structures segment are expected to be delivered during 2025, approximately 13% are expected to be delivered during 2026, and the remainder are expected to be delivered through 2028.
There is strong demand for transmission and distribution structures across the U.S. as much of the utility infrastructure has aged and needs replacement. Global concerns regarding emissions have increased consumer demand for electricity.
Our utility structures business is well-positioned to benefit from significant investment in utility infrastructure. There is strong demand for transmission and distribution structures across the U.S. as much of the utility infrastructure has aged and needs replacement. Global concerns regarding emissions have increased consumer demand for electricity.
The wind industry is currently awaiting finalization of the IRA's tax credit rules from the Internal Revenue Service (“IRS”). We believe these tax incentives provide a significant multi-year catalyst for our wind towers business, as demonstrated by more than $1.1 billion of new orders for delivery through 2028 we have received since the passage of the IRA.
We believe these tax incentives provide a significant multi-year catalyst for our wind towers business, as demonstrated by more than $1.1 billion of new orders for delivery through 2028 we have received since the passage of the IRA.
Information on our Investor Relations page and on our website is not part of this Annual Report on Form 10-K or any of our other securities filings unless specifically incorporated herein by reference. Long-Term Vision. We are united in our shared purpose to fulfill the four pillars of our long-term vision. Overview.
Information on our Investor Relations page and on our website is not part of this Annual Report on Form 10-K or any of our other securities filings unless specifically incorporated herein by reference. Long-Term Vision.
Where practical, we have operations located close to our local markets and, in certain locations, offer portable crushing services at a job site for re-use onsite. Proximity of our active quarries, stationary crushing locations, and strategic reserves to demand centers serve as barriers to entry. The U.S. aggregates industry is a highly fragmented industry with more than 5,000 producers nationwide.
Where practical, we have operations located close to our local markets and, in certain locations, offer portable crushing services at a job site for re-use onsite. Proximity of our active quarries, stationary crushing locations, and strategic reserves to demand centers serve as barriers to entry.
“ Risk Factors - Risks Related to Technology and Cybersecurity.” Governmental Regulation. Construction Products. Arcosa’s Construction Products segment is subject to regulation by the U.S. Mine Safety and Health Administration (“MSHA”), the Health-Safety and Reclamation Code of Ministry of Mines for British Columbia, and various state agencies, and certain specialty materials are regulated by the U.S.
Arcosa’s Construction Products segment is subject to regulation by the U.S. Mine Safety and Health Administration (“MSHA”), the Health-Safety and Reclamation Code of Ministry of Mines for British Columbia, and various state agencies, and certain specialty materials are regulated by the U.S. Food and Drug Administration (“FDA”). Engineered Structures.
Our inland barge business serves numerous end-markets through a base of established customers who support the transportation of staple commodities such as grain, coal, aggregates, chemicals, fertilizers, petrochemicals, and refined products.
Our fiberglass reinforced lift covers are used primarily for grain barges. 9 Table of Contents Markets Our inland barge business serves numerous end-markets through a base of established customers who support the transportation of staple commodities such as grain, coal, aggregates, chemicals, fertilizers, petrochemicals, and refined products.
All of the unsatisfied performance obligations for inland barges in our Transportation Products segment are expected to be delivered during the year ending 2024. Marketing. We sell substantially all of our products and services through our own sales personnel operating from offices in multiple locations in the U.S. and Mexico. We also use independent sales representatives and distributors. Human Capital.
Approximately 92% of the unsatisfied performance obligations for inland barges in our Transportation Products segment are expected to be delivered during 2025, and the remainder are expected to be delivered during 2026. Marketing. We sell substantially all of our products and services through our own sales personnel operating from offices in multiple locations in the U.S. and Mexico.
We believe we are well-positioned to benefit from significant upgrades in the electrical grid to support enhanced reliability, policy changes encouraging more generation from renewable energy sources, the expansion of new transmission, distribution, and telecommunication infrastructure, and the replacement and growth of the U.S. highway and road system. 7 Table of Contents Our utility structures business is well-positioned to benefit from significant investment in utility infrastructure.
We believe we are well-positioned to benefit from significant upgrades in the electrical grid to support enhanced reliability, demand for more electric generation from renewable energy sources, the expansion of new transmission, distribution, and telecommunication infrastructure, and the replacement and growth of the U.S. highway and road system.
Occupational Safety and Health Administration (“OSHA”) and, within our Construction Products segment, MSHA. We believe that we employ appropriate precautions to protect our employees and others from workplace injuries and harmful exposure to materials handled and managed at our facilities.
We believe that we employ appropriate precautions to protect our employees and others from workplace injuries and harmful exposure to materials handled and managed at our facilities.
Products Through wholly owned subsidiaries, our Transportation Products segment manufactures and sells inland barges, fiberglass barge covers, winches, marine hardware, and steel components for railcars and other transportation and industrial equipment. See Item 7.
Products Through wholly owned subsidiaries, our Transportation Products segment manufactures and sells inland barges, fiberglass barge covers, winches, and marine hardware. This segment also historically manufactured and sold steel components for railcars and other transportation and industrial equipment. In August 2024, we completed the sale of our steel components business. See Item 7.
Our natural aggregates products include sand, gravel, limestone, stabilized material, and various other products used in the production of ready mixed concrete, cement, and other precast concrete products, roads, municipal and private water, sewer and drainage projects, oil and gas well pads, wind farms, as well as various other building products. • Recycled Aggregates: We are the largest producer of recycled aggregates in the U.S. with operations in Texas, California, Florida, and Arizona.
Our natural aggregates products include sand, gravel, crushed stone, stabilized material, and various other products used in the production of ready mixed concrete, asphalt mix, cement, and other precast concrete products, roads, municipal and private water, sewer and drainage projects, oil and gas well pads, wind farms, as well as various other building products.
We believe our traffic structures business is well-positioned to benefit from public infrastructure spending in Florida and adjacent states, and has opportunities to grow organically into new geographies as well. Additionally, we expect to benefit from continued spending on the buildout of 5G and other wireless networks in North America within our telecommunication structures business.
We believe our traffic and lighting structures business is well-positioned to benefit from public infrastructure spending, replacement demand, and population growth. Additionally, we expect to benefit from continued spending on the buildout of 5G and other wireless networks in North America within our telecommunication structures business.
In general, we believe there is enough capacity in the supply industries to meet current production levels without any material impacts. We anticipate our existing contracts and other relationships with multiple suppliers will meet our current production forecasts. 8 Table of Contents Transportation Products.
Arcosa’s manufacturing operations also use component parts such as flanges for wind towers. In general, we believe there is enough capacity in the supply industries to meet current production levels without any material impacts. We anticipate our existing contracts and other relationships with multiple suppliers will meet our current production forecasts. Transportation Products.
Over the course of the program, more than half of the participants received promotions into plant leadership roles. This formal employee development program was created to help identify internal talent, provide skill and competency growth opportunities, and build a deep bench of emerging leaders at the Company.
This formal employee development program was created to help identify internal talent, provide skill and competency growth opportunities through formal development plans, and build a deep bench of emerging leaders at the Company.
Arcosa owns several patents, trademarks, copyrights, trade secrets, and licenses to intellectual property owned by others. Although Arcosa’s intellectual property rights are important to Arcosa’s success, we do not regard our business as being dependent on any single patent, trademark, copyright, trade secret, or license. For a discussion of risks related to our intellectual property, please refer to Item 1A.
Although Arcosa’s intellectual property rights are important to Arcosa’s success, we do not regard our business as being dependent on any single patent, trademark, copyright, trade secret, or license. For a discussion of risks related to our intellectual property, please refer to Item 1A. “ Risk Factors - Risks Related to Technology and Cybersecurity.” Governmental Regulation. Construction Products.
Our telecom structures business sells to wireless communication carriers and third-party tower lessors and developers. Raw Materials and Suppliers The principal material used in our Engineered Structures segment is steel. During 2023, the supply of steel was sufficient to support our manufacturing requirements. Overall steel prices began to rise sharply in late 2020, reaching record levels in 2021.
Our telecom structures business sells to wireless communication carriers and third-party tower lessors and developers. Raw Materials and Suppliers The principal material used in our Engineered Structures segment is steel. During 2024, the supply of steel was sufficient to support our manufacturing requirements. After several years of increasing steel prices, the price of plate steel decreased throughout 2024.
We use contract-specific purchasing practices, existing supplier commitments, contractual price escalation provisions, flexing between steel type, and other arrangements with our customers to mitigate the effect of steel price volatility on our operating profit for the year. Arcosa’s manufacturing operations also use component parts such as flanges for wind towers.
Steel prices may be volatile in the future in part as a result of market conditions. We use contract-specific purchasing practices, existing supplier commitments, contractual price escalation provisions, flexing between steel type, and other arrangements with our customers to mitigate the effect of steel price volatility on our operating profit for the year.
ARC 100 is inspired by the voices of frontline employees, driven by cross-functional teams, and actively supported by visible commitment from senior leaders. Since its implementation, Arcosa has experienced progress in reducing the severity and frequency of safety incidents as a result of a continued focus on building a strong safety culture through its ARC 100 safety initiative.
Since its implementation, Arcosa has experienced progress in reducing the severity and frequency of safety incidents as a result of a continued focus on building a strong safety culture through ARC 100.
Tank barges transport liquids, including refined products, chemicals, and a variety of petroleum products. Deck barges are used for transportation of heavy, oversized cargo and construction support. Our fiberglass reinforced lift covers are used primarily for grain barges. • Steel Components: We are a recognized manufacturer of steel components for railcars and other transportation equipment.
Tank barges transport liquids, including refined products, chemicals, and a variety of petroleum products. Deck barges are used for transportation of heavy, oversized cargo and construction support.
Employee Health and Safety. Arcosa is committed to safety across our operations. Our highest priority is the health and safety of our employees. We strive to continuously improve our procedures, processes, and management systems with regard to employee health and safety.
Arcosa is committed to safety across our operations. Our highest priority is the health and safety of our employees. We strive to continuously improve our procedures, processes, and management systems with regard to employee health and safety. These efforts are achieved by promoting safe work practices among employees and contractors and maintaining property and equipment in safe operating conditions.
The Company employed approximately 6,075 employees as of December 31, 2023. The following table presents the approximate headcount breakdown of employees by segment: December 31, 2023 Construction Products 2,040 Engineered Structures 2,775 Transportation Products 1,150 Corporate 110 6,075 As of December 31, 2023, approximately 4,795 employees were employed in the U.S., 1,260 employees in Mexico, and 20 employees in Canada.
The following table presents the approximate headcount breakdown of employees by segment: December 31, 2024 Construction Products 2,285 Engineered Structures 3,055 Transportation Products 795 Corporate 115 6,250 As of December 31, 2024, approximately 5,055 employees were employed in the U.S., 1,180 employees in Mexico, and 15 employees in Canada. Employee Health and Safety.
Revenues from GE Renewable Energy (“GE”) included in our Engineered Structures segment constituted 8.1%, 9.3%, and 9.5% of consolidated revenues for the years ended December 31, 2023, 2022, and 2021, respectively. Our traffic structures business primarily sells to individual state Departments of Transportation and highway contractors typically in a competitive-bid market.
(“GE Vernova”), a customer in our Engineered Structures segment, constituted 10.8%, 8.1%, and 9.3% of consolidated revenues for the years ended December 31, 2024, 2023, and 2022, respectively. Our traffic and lighting structures business primarily sells to contractors and distributors serving state Departments of Transportation and state and municipality agencies.
Our inland barge customers are primarily commercial marine transportation companies, lessors, and industrial shippers. While we compete with several other manufacturers in the U.S., we hold a majority share of the inland barge manufacturing market. We believe we are well-positioned to benefit from the expected fleet replacement cycle in both dry and liquid barges.
Customers and Competitors Our barge manufacturing facilities are located along the U.S. inland river systems, which allows for rapid delivery to our customers. Our inland barge customers are primarily commercial marine transportation companies, lessors, and industrial shippers. While we compete with several other manufacturers in the U.S., we hold a majority share of the inland barge manufacturing market.
Arcosa continued to make advancements in our safety culture with various ARC 100 initiatives across the Company, including: • Refreshed new hire orientation content to promote employee engagement in ARC 100; • Expansion of safety culture awareness training for all employees; • Development of leading indicators; and • Implementation of safety training management system.
Arcosa continued to make advancements in our safety culture with various ARC 100 initiatives across the Company, including: • Launch of the Arcosa "ALIVE" initiative focusing on Serious Injury and Fatality ("SIF") prevention; • Expanded new hire orientation content to promote employee engagement in ARC 100; • Continued progress on safety culture awareness training goals; • Internal measurement and reporting of leading indicators; and • Utilization of safety training management system.
At this time, we are involved in various stages of investigation and cleanup related to environmental remediation matters at certain of our facilities. In addition, soil or groundwater contamination may be present at several of our properties as a result of historical, ongoing, or nearby activities.
At this time, we are involved in various stages of investigation and cleanup related to environmental remediation matters at certain of our facilities.
Arcosa fosters employee development through a variety of leadership and training programs, like LEAD, as well as tuition reimbursement at education institutions, professional society memberships, and relevant conference and symposia attendance. Seasonality. Results in our Construction Products segment are affected by seasonal fluctuations with the second and third quarters historically being the quarters with the highest revenues. Intellectual Property.
Arcosa fosters employee development through a variety of leadership and training programs, like LEAD, as well as tuition reimbursement at education institutions, professional society memberships, and relevant conference and symposia attendance.
Demand for new wind energy projects in the U.S. has been supported by the Renewable Electricity Production Tax Credit (“PTC”) that was first introduced in 1992, providing a tax credit for electricity produced at each qualifying wind project.
We anticipate that the IIJA will continue to be beneficial for these businesses as well due to the increased level of highway spending and the provision for $65 billion in federal funding for broadband infrastructure. 8 Table of Contents Demand for new wind energy projects in the U.S. has been supported by the Renewable Electricity Production Tax Credit (“PTC”) that was first introduced in 1992, providing a tax credit for electricity produced at each qualifying wind project.
Coast Guard, the U.S. National Transportation Safety Board, the U.S. Customs Service, the Maritime Administration of the U.S. Department of Transportation ("USDOT"), and private industry organizations such as the American Bureau of Shipping.
National Transportation Safety Board, the U.S. Customs Service, the Maritime Administration of the U.S. Department of Transportation ("USDOT"), and private industry organizations such as the American Bureau of Shipping. These organizations establish safety criteria, investigate vessel accidents, and recommend improved safety standards. In August 2024, we completed the sale of our steel components business.
All such agencies and authorities promulgate rules, regulations, specifications, and operating standards affecting rail-related safety standards for railroad equipment. Occupational Safety and Health Administration and Similar Regulations. In addition to the regulations described above, our operations are subject to regulation of health and safety matters by the U.S.
Occupational Safety and Health Administration and Similar Regulations. In addition to the regulations described above, our operations are subject to regulation of health and safety matters by the U.S. Occupational Safety and Health Administration (“OSHA”) and, within our Construction Products segment, MSHA.
“ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” and Note 15 of the Consolidated Financial Statements for further information regarding reserves for environmental matters. See Item 1A for further discussion of risk factors with regard to environmental, governmental, and other matters. 12 Table of Contents Information About Our Executive Officers.
In the event that such liabilities were to significantly exceed the amounts recorded, our results of operations could be materially adversely affected. See Note 15, "Commitments and Contingencies" of the Consolidated Financial Statements for further information regarding reserves for environmental matters. See Item 1A for further discussion of risk factors with regard to environmental, governmental, and other matters.
Our specialty materials products enjoy higher barriers to entry than our natural and recycled aggregates due to specific mineral properties, specialized manufacturing, or additional processing. Due to the added value in processing, specialty materials have a much wider, multi-state distribution area due to their higher value relative to their distribution costs as compared to natural and recycled aggregates.
Due to the added value in processing, specialty materials have a much wider, multi-state distribution area due to their higher value relative to their distribution costs as compared to natural and recycled aggregates. We compete with specialty materials producers nationwide. For trench shields and shoring products, our customers are equipment rental dealers and commercial, residential, and industrial contractors.
We compete with specialty materials producers nationwide. For trench shields and shoring products, our customers are equipment rental dealers and commercial, residential, and industrial contractors. We compete with shoring products manufacturers nationwide. 6 Table of Contents Raw Material and Suppliers The primary raw material for our natural aggregates and specialty materials comes from quarries.
We compete with shoring products manufacturers nationwide. Raw Material and Suppliers The primary raw material for our natural aggregates and specialty materials comes from quarries. Natural aggregates and specialty materials can be found throughout the U.S.
These organizations establish safety criteria, investigate vessel accidents, and recommend improved safety standards. 11 Table of Contents Our steel components businesses that serve the railcar industry are regulated by governmental agencies such as the USDOT and the administrative agencies it oversees, including the Federal Railroad Administration, and industry authorities such as the Association of American Railroads.
Our steel components business served the railcar industry and was regulated by governmental agencies such as the USDOT and the administrative agencies it oversees, including the Federal Railroad Administration, and industry authorities such as the Association of American Railroads. All such agencies and authorities promulgate rules, regulations, specifications, and operating standards affecting rail-related safety standards for railroad equipment.
Arcosa's three segments are made up of leading businesses that serve critical infrastructure markets: (1) Revenues for the year ended December 31, 2022 include $188.9 million from the storage tanks business that was sold on October 3, 2022. 4 Table of Contents Our Segments. The Company reports operating results in three principal business segments.
Arcosa's three segments are made up of leading businesses that serve critical infrastructure markets: (1) On August 16, 2024, the Company completed the divestiture of its steel components business. We recognized $87.8 million and $153.3 million in revenues from the business in 2024 and 2023, respectively. Our Segments. The Company reports operating results in three principal business segments.
Product applications include plasters, prills, agricultural supplements and fertilizers, paints, flooring, glass, ingredients for food and feed, cement, energy infrastructure, and other products. • Construction Site Support: We hold a strong market position in the manufacturing of trench shields and shoring products for the U.S. construction industry.
Product applications include plasters, flooring, prills, agricultural supplements and fertilizers, paints, glass, ingredients for food and feed, cement, energy infrastructure, and other products. • Asphalt: Through the acquisition of Stavola, we produce and sell asphalt mix and provide asphalt construction paving services in New Jersey. Asphalt is an aggregate-intensive downstream product that strengthens our local market position.
In 2023, pricing for hot rolled coil was volatile, while plate steel prices remained elevated, with a slight decline throughout the year. Steel prices may be volatile in the future in part as a result of market conditions.
After several years of increasing steel prices, the price of plate steel decreased throughout 2024. Steel prices may be volatile in the future in part as a result of market conditions.
We compete, in most cases, with natural and recycled aggregates producers in the regions where we operate. Many opportunities for consolidation exist. Therefore, companies in the industry tend to grow by acquiring existing facilities to extend their current market positions or enter new markets.
Therefore, companies in the industry tend to grow by acquiring existing facilities to extend their current market positions or enter new markets. Our specialty materials products enjoy higher barriers to entry than our natural and recycled aggregates due to specific mineral properties, specialized manufacturing, or additional processing.
This belief drives our commitment to a workplace free from discrimination where collaboration, dedication, and unity align to drive favorable results for all stakeholders. Talent Attraction and Management. Arcosa believes that its future success is highly dependent upon the Company’s continued ability to attract, retain, and motivate qualified employees.
One of Arcosa’s core values is “We Win Together.” This belief drives our commitment to a workplace free from discrimination where collaboration, dedication, professionalism, and unity align to drive favorable results for all stakeholders. Seasonality.
These initiatives, as well as many others implemented at Arcosa sites, assist in building a strong safety culture, driven by engaged employee and management teams. Diversity and Inclusion. Arcosa values diversity and inclusion within its workforce and is committed to a work environment which promotes professionalism and inclusiveness. One of Arcosa’s core values is “We Win Together”.
These initiatives, as well as many others implemented at Arcosa sites, assist in building a strong safety culture, driven by engaged employee and management teams. Talent Attraction and Management. Arcosa believes that its future success is highly dependent upon the Company’s continued ability to attract, retain, and motivate qualified employees.
In 2023, we had shipments of approximately 38 million tons of aggregates and specialty materials, including approximately 5 million tons of recycled aggregates. Texas is our largest geographic market, representing approximately 45% of the segment's revenues in 2023. All other states each are less than 10% of segment revenues.
Texas is our largest geographic market, representing approximately 40% of the segment's revenues in 2024. Pro forma for the full-year impact of the Stavola acquisition, which closed on October 1, 2024, Texas and New Jersey represent approximately 35% and 20% of segment revenues. All other states each are less than 10% of segment revenues.
These efforts are achieved by promoting safe work practices among employees and contractors and maintaining property and equipment in safe operating conditions. 10 Table of Contents In 2019, we launched a reenergized safety initiative, ARC 100, to build a positive and proactively engaged culture of safety excellence.
In 2019, we launched a reenergized safety initiative referred to as "ARC 100" to build a positive and proactively engaged culture of safety excellence. ARC 100 is inspired by the voices of frontline employees, driven by cross-functional teams, and actively supported by visible commitment from senior leaders.
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Non-residential construction activity, while showing signs of recent slowing in the U.S., has remained healthy in our markets supported by heavy industrial activity and the lagged effect of a strong residential construction cycle.
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We are united in our shared purpose to continue to fulfill the four strategic pillars of our long-term vision, and in 2024 we also executed on a newly added fifth strategic pillar with a focus on our financial leverage. 4 Table of Contents Overview.
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In March 2023, we began construction of a new wind tower plant in New Mexico to support the growing wind investment in the Southwest. • Traffic Structures: We manufacture steel traffic structures for use in the U.S. highway and road system primarily serving Florida and adjacent states.
Added
On October 1, 2024, we completed the acquisition of the construction materials business of Stavola Holding Corporation and its affiliated entities ("Stavola") for $1.2 billion in cash. The Stavola acquisition expanded our aggregates platform by providing entry to the New York-New Jersey Metropolitan Statistical Area ("MSA").
Removed
Our products include overhead steel sign structures, tolling gantry structures, mast and sign arms, and other custom solutions. We have one dedicated manufacturing plant in Florida and have the capability to manufacture traffic structures in our other Engineered Structures plants. • Telecommunication Structures: We manufacture telecom structures, including self-supporting lattice towers, monopole towers, and guyed towers.
Added
Stavola is an aggregates-led and vertically integrated construction materials company with a network of five hard rock natural aggregates quarries, twelve asphalt plants, and three recycled aggregates sites. • Recycled Aggregates: We are the largest producer of recycled aggregates in the U.S. with operations in Texas, New Jersey, California, Florida, and Arizona.
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We anticipate that the IIJA will continue to be beneficial for these businesses as well due to the increased level of highway spending and the provision for $65 billion in federal funding for broadband infrastructure.
Added
We also produce reclaimed asphalt pavement ("RAP"), primarily for sale to our asphalt operations. Recycled aggregates currently supply a small percentage of total aggregates supplied nationwide.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeArcosa will have to continually upgrade its infrastructure and applications to reduce or mitigate these risks. Security breaches in Arcosa’s information technology systems could result in theft, destruction, loss, misappropriation, or release of protected, confidential or other sensitive data including personal information of our employees, trade secrets, or other proprietary intellectual property that could adversely impact Arcosa’s future results.
Biggest changeSecurity breaches could result in theft, destruction, loss, misappropriation, or release of protected, confidential, or other sensitive data including personal information of our employees, trade secrets, or other proprietary intellectual property that could adversely impact Arcosa's future results. 27 Table of Contents While we employ several measures to prevent, detect, and mitigate these threats, there is no guarantee such efforts will be successful in preventing a cyber event or that any third parties with which we do business will be successful in preventing a cyber event.
The inability to maintain and secure locations and permits for recycled aggregates operations could negatively affect our results of operations. Reductions in the availability of energy supplies or an increase in energy costs may increase Arcosa’s operating costs.
The inability to secure and maintain locations and permits for recycled aggregates operations could negatively affect our results of operations. Reductions in the availability of energy supplies or an increase in energy costs may increase Arcosa’s operating costs.
In addition, amendments to existing statutes and regulations, adoption of new statutes and regulations, modification of existing operating permits, or entering into new lines of business which are covered by regulatory agencies that Arcosa has not previously been subject to could require us to alter our methods of operation and/or discontinue the sale of certain of our products, resulting in costs to us that could be substantial.
In addition, amendments to existing statutes and regulations, adoption of new statutes and regulations, modification of existing operating permits, or entering into new lines of business which are covered by regulatory agencies that Arcosa has not previously been subject to could require us to alter our methods of operation and/or discontinue the sale of certain of our products, resulting in substantial costs.
Other adverse consequences of climate change could include an increased frequency of severe weather events, low river levels, drought, flooding, and rising sea levels that could affect operations at Arcosa’s manufacturing facilities as well as the price and/or availability of insurance coverage for the Company assets or other unforeseen disruptions of Arcosa’s operations, systems, property, or equipment.
Other adverse consequences of climate change could include an increased frequency of severe weather events, low river levels, drought, flooding, wildfires, and rising sea levels that could affect operations at Arcosa’s manufacturing facilities as well as the price and/or availability of insurance coverage for the Company assets or other unforeseen disruptions of Arcosa’s operations, systems, property, or equipment.
In addition, Arcosa’s restated certificate of incorporation authorizes Arcosa to issue, without the approval of Arcosa’s stockholders, one or more classes or series of preferred stock having such designation, powers, preferences, and relative, participating, optional, and other special rights, including preferences over Arcosa common stock respecting dividends and distributions, as Arcosa’s Board of Directors generally may determine.
In addition, Arcosa’s restated certificate of incorporation authorizes Arcosa to issue, without the approval of Arcosa’s stockholders, one or more classes or series of preferred stock having such designation, powers, preferences, and relative, participating, optional, and other special rights, including preferences over Arcosa common stock respecting dividends and distributions, as the Board generally may determine.
Furthermore, any material change in the quotas, regulations or duties on imports imposed by the U.S. government and agencies or on exports by the government of Mexico or its agencies, could affect Arcosa’s ability to export products that Arcosa manufactures in Mexico. Failure to comply with such import and export regulations could result in significant fines and penalties.
Furthermore, any material change in the tariffs, quotas, regulations or duties on imports imposed by the U.S. government and agencies or on exports by the government of Mexico or its agencies, could affect Arcosa’s ability to export products that Arcosa manufactures in Mexico. Failure to comply with such import and export regulations could result in significant fines and penalties.
Arcosa's growth strategy may result in the acquisition of a new lines of business or expansion into geographic markets (whether inside or outside the U.S.) in which we have limited operating experience, including with respect to seeking regulatory approvals, becoming subject to regulatory authorities, and marketing or selling products.
Arcosa's growth strategy may result in the acquisition of new lines of business or expansion into geographic markets (whether inside or outside the U.S.) in which we have limited operating experience, including with respect to seeking regulatory approvals, becoming subject to regulatory authorities, and marketing or selling products.
Equipment failures or other material disruption at one or more of Arcosa’s manufacturing facilities or other facilities or in Arcosa’s supply chain could have a material adverse effect on us. In some instances, Arcosa relies on a limited number of suppliers for certain raw materials, parts, and components needed in its production.
Equipment failures or other material disruption at one or more of Arcosa’s manufacturing or mining facilities or in Arcosa’s supply chain could have a material adverse effect on us. In some instances, Arcosa relies on a limited number of suppliers for certain raw materials, parts, and components needed in its production.
These provisions include limitations on the ability of our stockholders to call special meetings, the establishment of advance notice procedures for stockholder proposals and nominations for election of directors and allow for Arcosa's Board of Directors to issue blank check preferred stock with voting or conversion rights without stockholder approval.
These provisions include limitations on the ability of our stockholders to call special meetings, the establishment of advance notice procedures for stockholder proposals and nominations for election of directors and allow for the Board to issue blank check preferred stock with voting or conversion rights without stockholder approval.
We use controlled hazardous materials in our business and generate wastes that are regulated as hazardous wastes under U.S. federal, state, and local environmental laws and under equivalent provisions of law in those and other jurisdictions in which our manufacturing facilities are located.
We use controlled hazardous materials in our business and generate wastes that are regulated as hazardous wastes under U.S. federal, state, and local environmental laws and under equivalent provisions of law in other jurisdictions in which our manufacturing facilities are located.
Arcosa owns and operates manufacturing facilities of various ages and levels of automated control and relies on a number of third parties as part of Arcosa’s supply chain, including for the efficient distribution of products to Arcosa’s customers.
Arcosa owns and operates manufacturing and mining facilities of various ages and levels of automated control and relies on a number of third parties as part of Arcosa’s supply chain, including for the efficient distribution of products to Arcosa’s customers.
The transportation of commodities by rail, barge, or container also raises potential liability risks in the event of an accident that results in the release of substances that cause harm to the environment, natural resources, or result in exposure to harmful substances.
The transportation of commodities by rail, barge, or container also raises potential liability risks in the event of an accident that results in the release of substances that cause or threaten to cause harm to the environment or, natural resources, or result in exposure to harmful substances.
Arcosa’s operations are also subject to various governmental regulations in the U.S., Mexico, and other countries where we do business related to occupational safety and health, labor, and business practices, including OSHA and MSHA.
Arcosa’s operations are also subject to various governmental regulations in the U.S., Mexico, and other countries where we do business related to the environment, occupational safety and health, labor, and business practices, including OSHA and MSHA.
Our use of these substances and materials is subject to stringent, and periodically changing, regulation that can impose costly compliance obligations on us and have the potential to adversely affect our manufacturing activities.
Our use and management of these substances and materials is subject to stringent, and periodically changing, regulation that can impose costly compliance obligations on us and have the potential to adversely affect our manufacturing activities.
Although we believe that we are in material compliance with all applicable regulations and operating permits material to our business operations, if we determine that our current or future products or processes are not in compliance with applicable requirements, rules, regulations, specifications, standards or product testing criteria, it might result in additional operating expenses, administrative fines or penalties, criminal sanctions, product recalls, reputational harm, or loss of business that could have a material adverse effect on Arcosa’s business.
Although we believe that we are in material compliance with all applicable regulations and operating permits material to our business operations, if we determine that our products or processes are not in compliance with applicable requirements, rules, regulations, specifications, standards or product testing criteria, it might result in additional operating expenses, administrative fines or penalties, criminal sanctions, product recalls, reputational harm, or loss of business that could have a material adverse effect on Arcosa’s business.
However, future events, such as changes in, or modified interpretations of, existing environmental laws and regulations or enforcement policies, or further investigation or evaluation of the potential health hazards associated with the manufacture of Arcosa’s products and related business activities and properties, may give rise to additional compliance and other costs that could have a material adverse effect on Arcosa’s business.
Moreover, future events, such as changes in, or modified interpretations of, existing environmental laws and regulations or enforcement policies, or further investigation or evaluation of the potential health hazards associated with the manufacture of Arcosa’s products and related business activities and properties, may give rise to additional compliance and other costs that could have a material adverse effect on Arcosa’s business.
Arcosa's ability to meet customer delivery schedules for backlog is dependent on a number of factors including, but not limited to, sufficient manufacturing plant capacity, adequate supply channel access to raw materials and other inventory required for production, an adequately trained 14 Table of Contents and capable workforce, engineering expertise, and appropriate planning and scheduling of manufacturing resources.
Arcosa's ability to meet customer delivery schedules for backlog is dependent on a number of factors including, but not limited to, sufficient manufacturing plant capacity, adequate supply channel access to raw materials and other inventory required for production, an adequately trained 15 Table of Contents and capable workforce, engineering expertise, and appropriate planning and scheduling of manufacturing resources.
In addition, Arcosa is subject to Section 203 of the Delaware General Corporation Law which makes it more difficult for a person who acquires, 15% or more of Arcosa's outstanding voting stock to effect various business combinations with us for a three-year period following the time such stockholder became a 15% stockholder. 27 Table of Contents Arcosa believes these provisions will protect its stockholders from coercive or otherwise unfair takeover tactics by requiring potential acquirers to negotiate with Arcosa’s Board of Directors and by providing Arcosa’s Board of Directors with more time to assess any acquisition proposal.
In addition, Arcosa is subject to Section 203 of the Delaware General Corporation Law which makes it more difficult for a person who acquires, 15% or more of Arcosa's outstanding voting stock to effect various business combinations with us for a three-year period following the time such stockholder became a 15% stockholder. 28 Table of Contents Arcosa believes these provisions will protect its stockholders from coercive or otherwise unfair takeover tactics by requiring potential acquirers to negotiate with the Board and by providing the Board with more time to assess any acquisition proposal.
Arcosa’s operations outside of the U.S. are subject to risks associated with cross-border business transactions and activities. Political, legal, trade, or economic change or instability, criminal activities, or social unrest could limit or curtail Arcosa’s respective foreign business activities and operations, including the ability to hire and retain employees. Violence in Mexico associated with drug trafficking is continuing.
Arcosa’s operations outside of the U.S. are subject to risks associated with cross-border business transactions and activities. Political, legal, trade, environmental regulations, or economic change or instability, criminal activities, or social unrest could limit or curtail Arcosa’s respective foreign business activities and operations, including the ability to hire and retain employees. Violence in Mexico associated with drug trafficking is continuing.
For example, Arcosa’s competitors may import competing products that are subsidized by foreign governments and sold in the U.S. at less than fair value. The results of trade negotiations, trade agreements, and tariffs could also negatively affect Arcosa’s supplies, cost of goods sold, and customers. For example, Arcosa produces certain products at its manufacturing facilities in Mexico.
Arcosa’s competitors may import competing products that are subsidized by foreign governments and sold in the U.S. at less than fair value. The results of trade negotiations, trade agreements, and tariffs could also negatively affect Arcosa’s supplies, cost of goods sold, and customers. Arcosa produces certain products at its manufacturing facilities in Mexico.
Our business is at risk from and may be impacted by information security incidents, including attempts to gain unauthorized access to our systems or data, ransomware, malware, phishing scams, and other physical and electronic security events as well as from similar events impacting third parties with which we do business.
Our business is at risk from and may be impacted by information security incidents, including attempts to gain unauthorized access to our systems or data, ransomware, malware, phishing or social engineering scams, and other physical and electronic security events as well as from similar events impacting third parties with which we do business.
These provisions are not intended to make Arcosa immune from takeovers. However, these provisions will apply even if the offer may be considered beneficial by some stockholders and could delay or prevent an acquisition that Arcosa’s Board of Directors determines is not in the best interests of Arcosa and its stockholders.
These provisions are not intended to make Arcosa immune from takeovers. However, these provisions will apply even if the offer may be considered beneficial by some stockholders and could delay or prevent an acquisition that the Board determines is not in the best interests of Arcosa and its stockholders.
Arcosa is exposed to risks associated with changes in foreign currency exchange rates. For example, Arcosa has substantial manufacturing operations in Mexico. To the extent there are significant changes in the exchange rate between the U.S. dollar and the Mexican peso, Arcosa may incur increased costs or losses and reduced profits.
Arcosa is exposed to risks associated with changes in foreign currency exchange rates. Arcosa has substantial manufacturing operations in Mexico. To the extent there are significant changes in the exchange rate between the U.S. dollar and the Mexican peso, Arcosa may incur increased costs or losses and reduced profits.
For example, if volatile conditions in the global credit markets such as rising interest rates and tightening of credit standards limit our customers' access to credit (or increase the cost of obtaining credit), product order volumes may decrease, or customers may default on payments owed to Arcosa.
If volatile conditions in the global credit markets such as rising interest rates and tightening of credit standards limit our customers' access to credit (or increase the cost of obtaining credit), product order volumes may decrease, or customers may default on payments owed to Arcosa.
Arcosa’s Governing Documents and Delaware law contain provisions that are intended to deter coercive takeover practices and inadequate takeover bids by making such practices or bids unacceptably expensive to the bidder and to encourage prospective acquirers to negotiate with Arcosa’s Board of Directors rather than to attempt a hostile takeover.
Arcosa’s Governing Documents and Delaware law contain provisions that are intended to deter coercive takeover practices and inadequate takeover bids by making such practices or bids unacceptably expensive to the bidder and to encourage prospective acquirers to negotiate with the Board rather than to attempt a hostile takeover.
For example, this could result in delays in or cancellations of the purchase of Arcosa’s products or shortages in raw materials, parts, or components, any of which could prevent Arcosa from meeting its financial and other obligations. Litigated disputes and other claims could increase Arcosa’s costs and weaken Arcosa’s liquidity and financial condition.
This could result in delays in or cancellations of the purchase of Arcosa’s products or shortages in raw materials, parts, or components, any of which could prevent Arcosa from meeting its financial and other obligations. Litigated disputes and other claims could increase Arcosa’s costs and weaken Arcosa’s liquidity and financial condition.
For example, sales of Arcosa's products are somewhat higher from spring through autumn when construction activity is greatest. Construction activity declines in these markets during the winter months in particular due to inclement weather, frozen ground, and fewer hours of daylight.
Sales of Arcosa's products are somewhat higher from spring through autumn when construction activity is greatest. Construction activity declines in these markets during the winter months in particular due to inclement weather, frozen ground, and fewer hours of daylight.
The timing, declaration, amount, and payment of future dividends to Arcosa’s stockholders falls within the discretion of Arcosa’s Board of Directors (the "Board").
The timing, declaration, amount, and payment of future dividends to Arcosa’s stockholders falls within the discretion of the Board.
The risk of accidental contamination or injury from these materials cannot be completely eliminated. If an accident involving these substances occurs, we could be held liable for any damages that result, as well as incurring clean-up costs and liabilities, which can be substantial. Additionally, an accident could damage our facilities, resulting in delays and increased costs.
The risk of accidental contamination or injury from these materials cannot be completely eliminated. If an accident involving these substances occurs, we could be held liable for any damages that result, as well as incur clean-up costs and liabilities, which can be substantial. Additionally, an accident could damage our facilities, resulting in operational delays and increased costs.
For example, Arcosa operates an underground limestone mine in Pennsylvania, which involves unique potential safety risks and hazards inherent to underground mining operations. Safety is a primary focus of our business and is critical to our reputation and performance.
Arcosa operates an underground limestone mine in Pennsylvania, which involves unique potential safety risks and hazards inherent to underground mining operations. Safety is a primary focus of our business and is critical to our reputation and performance.
If we were to pursue legal remedies against a customer that failed to purchase the contracted amount of product under a fixed-volume contract or failed to satisfy the take-or-pay commitment under a take-or-pay contract, we may 17 Table of Contents receive significantly less in a judgment or settlement of any claimed breach than we would have received had the customer fully performed under the contract.
If we were to pursue legal remedies against a customer that failed to purchase the contracted amount of product under a fixed-volume contract or failed to satisfy the take-or-pay commitment under a take-or-pay contract, we may receive significantly less in a judgment or settlement of any claimed breach than we would have received had the customer fully performed under the contract.
In addition, Arcosa's success in recovering natural aggregates and specialty materials depends on the ability to secure new reserve locations and permits to mine such reserves in areas that make distribution of materials economically viable. Community engagement and maintaining good relations within the communities where we operate is important to retaining and securing permits.
In addition, Arcosa's success in recovering natural aggregates and specialty materials depends on the ability to secure new reserve locations and permits to mine such reserves in areas that make distribution of materials economically viable. Engaging and maintaining good relations within the communities where we operate is important to securing and retaining permits.
"Commitments and Contingencies” for additional information on the Company’s current litigation. Risks Related to Growth Strategy. Arcosa may not be able to successfully identify, consummate or integrate acquisitions. Arcosa expects to routinely engage in the search for growth opportunities, including assessment of merger and acquisition prospects in new markets and/or products.
See Note 15. "Commitments and Contingencies” for additional information on the Company’s current litigation. Risks Related to Growth Strategy. Arcosa may not be able to successfully identify, consummate or integrate acquisitions. Arcosa expects to routinely engage in the search for growth opportunities, including assessment of merger and acquisition prospects in new markets and/or products.
The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the residual value of Arcosa common stock. 28 Table of Contents Item 1B. Unresolved Staff Comments. None.
The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the residual value of Arcosa common stock. 29 Table of Contents Item 1B. Unresolved Staff Comments. None.
We are also subject to potential liability for claims alleging property damage and personal and bodily injury or death arising from the use of or exposure to our 24 Table of Contents products, especially in connection with products we manufacture that our customers use to transport or store hazardous, flammable, toxic, or explosive materials.
We are also subject to potential liability for claims alleging property damage and personal and bodily injury or death arising from the use of or exposure to our products, especially in connection with products we manufacture that our customers use to transport or store hazardous, flammable, toxic, or explosive materials.
The Board of Directors’ decisions regarding the payment of future dividends will depend on many factors, such as Arcosa’s financial condition, earnings, capital requirements, debt service obligations, covenants related to our debt service obligations, industry practice, legal requirements, regulatory constraints, access to the capital markets, and other factors that the Board of Directors deems relevant.
The Board's decisions regarding the payment of future dividends will depend on many factors, such as Arcosa’s financial condition, earnings, capital requirements, debt service obligations, covenants related to our debt service obligations, industry practice, legal requirements, regulatory constraints, access to the capital markets, and other factors that the Board deems relevant.
In addition, since Arcosa's operations are in a variety of geographic markets, its businesses are subject to differing economic conditions in each such geographic market. While the business cycles of Arcosa’s different operations may not typically coincide, an economic downturn could affect disparate cycles contemporaneously.
In addition, since Arcosa's operations are in a variety of geographic markets, its businesses are subject to differing economic conditions and labor availability in each such geographic market. While the business cycles of Arcosa’s different operations may not typically coincide, an economic downturn could affect disparate cycles contemporaneously.
The negative impact on the economy from a pandemic, epidemic or other public health emergency could also impact our customers in similar ways, causing customers to postpone projects, cancel or delay orders, or file bankruptcy. A pandemic, epidemic, or other public health emergency could also disrupt Arcosa's cross-border business transactions and activities.
The negative impact on the economy from a public health emergency could also impact our customers in similar ways, causing customers to postpone projects, cancel or delay orders, or file bankruptcy. A public health emergency could also disrupt Arcosa's cross-border business transactions and activities.
Any downgrades in our credit ratings may make raising capital more difficult, increase the cost and 19 Table of Contents affect the terms of future borrowings, affect the terms under which we purchase goods and services and limit our ability to take advantage of potential business opportunities.
Any downgrades in our credit ratings may make raising capital more difficult, increase the cost and affect the terms of future borrowings, affect the terms under which we purchase goods and services, and limit our ability to take advantage of potential business opportunities.
In the event of any customer's breach, we may also choose to renegotiate any disputed contract on less favorable terms (including with respect to price and volume) in order to preserve the relationship with that customer.
In the event of any customer's breach, we may also choose to 18 Table of Contents renegotiate any disputed contract on less favorable terms (including with respect to price and volume) in order to preserve the relationship with that customer.
Arcosa relies on government personnel to conduct certain routine business processes related to the inspection and delivery of certain products that, if disrupted, could have an immediate impact on Arcosa's revenues and business.
Arcosa relies on government personnel to conduct certain routine business processes for the inspection and delivery of certain products that, if disrupted, could have an impact on Arcosa's revenues and business.
Although Arcosa maintains reserves for its probable and reasonably estimable liability, Arcosa’s reserves may be inadequate to cover its portion of claims or final judgments after taking into consideration rights in indemnity and recourse under insurance policies or to third parties as a result of which there could be a material adverse effect on Arcosa’s business. See Note 15.
Although Arcosa maintains reserves for its probable and reasonably estimable liability, Arcosa’s reserves may be inadequate to cover its portion of claims or final judgments after taking into consideration rights in indemnity and recourse under insurance policies or to third parties as a result 23 Table of Contents of which there could be a material adverse effect on Arcosa’s business.
If Arcosa fails to comply with the applicable regulations related to the foreign countries where Arcosa operates, 20 Table of Contents Arcosa may be unable to market and sell its products in those countries or could be subject to administrative fines or penalties.
If Arcosa fails to comply with the applicable regulations related to the foreign countries where Arcosa operates, Arcosa may be unable to market and sell its products in those countries or could be subject to administrative fines or penalties.
Some of Arcosa’s customers place orders for Arcosa’s products (i) in reliance on their ability to obtain and utilize tax benefits or tax credits such as accelerated depreciation or the production tax credit or investment tax credit for renewable energy or (ii) to utilize federal-aid programs that allow for purchase price reimbursement or other government funding or subsidies, any of which benefits, credits, or programs could be modified, discontinued or allowed to expire without extension thereby reducing demand for certain of Arcosa’s products and reducing certain tax credits for which Arcosa may be eligible.
Some of Arcosa’s customers and contractual counterparties (i) rely on their ability to obtain or utilize tax benefits or tax credits such as accelerated depreciation or the production tax credit or investment tax credit for renewable energy or (ii) utilize federal-aid programs that allow for purchase price reimbursement or other government funding or subsidies, any of which benefits, credits, or programs could be modified, discontinued or allowed to expire without extension thereby reducing demand for certain of Arcosa’s products or reducing certain tax credits or other tax benefits for which Arcosa or its contractual counterparties may be eligible.
Terrorist activities, anti-terrorist efforts, and other armed conflict involving the U.S. or its interests abroad or other foreign actors, including the war in Ukraine and the Israeli-Hamas conflict, may adversely affect the U.S. and global economies, potentially negatively affecting the industries in which Arcosa operates.
Terrorist activities, anti-terrorist efforts, and other armed conflict involving the U.S. or its interests abroad or other foreign actors, including the war in Ukraine and the conflicts in the Middle East, may adversely affect the U.S. and global economies, potentially negatively affecting the industries in which Arcosa operates.
Any material nonpayment or nonperformance by any of our customers could have a material adverse effect on our revenue and cash flows.
Any material nonpayment or nonperformance by any of our customers could have a material adverse effect on our business and results of operations. Any material nonpayment or nonperformance by any of our customers could have a material adverse effect on our revenue and cash flows.
An outbreak or escalation of hostilities between the U.S. and any foreign power or between other foreign powers, such as the war in Ukraine or the Israeli-Hamas conflict, could result in a real or perceived shortage of petroleum and/or natural gas, which could result in an increase in the cost of natural gas or energy in general.
An outbreak or escalation of hostilities between the U.S. and any foreign power or between other foreign powers, such as the war in Ukraine or the conflicts in the Middle East, could result in a real or perceived shortage of petroleum and/or natural gas, which could result in an increase in the cost of natural gas or energy in general.
Integration risks include the following: (i) the diversion of management’s time and resources to integration matters from other Arcosa matters; (ii) difficulties in achieving business opportunities and growth prospects of the acquired business; (iii) difficulties in managing the expanded operations; and (iv) challenges in retaining key personnel.
Integration risks include the following: (i) the diversion of management’s time and resources to integration matters from other Arcosa matters; (ii) difficulties in achieving business opportunities and growth prospects of the acquired business; (iii) difficulties in managing the expanded operations; (iv) challenges in retaining key personnel; and (v) the disruption of ongoing business, customer, and employee relationships.
In addition, if Arcosa is not able to successfully integrate its transactions to any material degree, such failure of a successful integration could result in unexpected claims or otherwise have a material adverse effect on Arcosa’s business.
In addition, if Arcosa is not able to successfully integrate its transactions, including the Ameron and Stavola acquisitions, to any material degree, such failure of a successful integration could result in unexpected claims or otherwise have a material adverse effect on Arcosa’s business.
During the COVID-19 pandemic, governments in the United States and elsewhere in the world implemented strict measures to help control the spread of the virus, including quarantines, travel restrictions, business curtailments, and other measures. Such actions may impair or prevent Arcosa from continuing its operations and business arrangements outside the United States.
During the COVID-19 pandemic, governments in the U.S. and elsewhere in the world implemented strict measures to help control the spread of the virus, including quarantines, travel restrictions and business curtailments. Such actions may impair or prevent Arcosa from continuing its operations.
Arcosa's business benefits from free trade agreements, such as the United States-Mexico-Canada Agreement ("USMCA"). Potential developments, including failure to enforce the USMCA, potential changes or amendments to the agreement, governmental policies, and laws and regulations could adversely affect Arcosa's existing production operations in Mexico and have a material adverse effect on Arcosa's business.
Arcosa's business benefits from free 22 Table of Contents trade agreements, such as the United States-Mexico-Canada Agreement ("USMCA"). Potential USMCA developments, including tariffs, changes or amendments to the agreement, governmental orders, policies, and laws and regulations could adversely affect Arcosa's existing production operations in Mexico and have a material adverse effect on Arcosa's business.
If government funding is not approved or funding is lowered as a result of poor economic conditions, lower than expected revenues, competing spending priorities, or other factors, it could limit infrastructure projects available, increase competition for projects, result in excess inventory, and decrease sales, all of which could adversely affect the profitability of Arcosa’s business.
If government funding is not approved or funding is lowered as a result of a change in priorities under the current U.S. presidential administration, poor economic conditions, lower than expected revenues, or other factors, it could limit infrastructure projects available, increase competition for projects, result in excess inventory, and decrease sales, all of which could adversely affect the profitability of Arcosa’s business.
Projects in which Arcosa participates may be funded directly by governments or privately-funded, but are otherwise tied to or impacted by government policies and spending measures. 21 Table of Contents Government spending is often approved only on a short-term basis and some of the projects in which Arcosa’s products are used require longer-term funding commitments.
Projects in which Arcosa participates may be funded directly by governments or privately-funded, but are otherwise tied to or impacted by government policies, U.S. presidential executive orders and memorandums, and spending measures. Government spending is often approved only on a short-term basis and some of the projects in which Arcosa’s products are used require longer-term funding commitments.
Arcosa's inability to deliver its backlog on time could affect its revenues, future sales and profitability and its relationships with customers. At December 31, 2023, Arcosa's backlog was approximately $1.4 billion within our Engineered Structures and $253.7 million within our Transportation Products segments.
Arcosa's inability to deliver its backlog on time could affect its revenues, future sales and profitability and its relationships with customers. At December 31, 2024, Arcosa's backlog was approximately $1.2 billion within our Engineered Structures and $280.1 million within our Transportation Products segments.
The impact of increased prices and inflation on principal raw material prices, including steel with respect to the order of new barges or wind towers, could negatively impact Arcosa's performance and financial results.
The impact of increased prices and inflation on principal raw material prices, including the cost of steel with respect to the order of new barges or wind towers and liquid asphalt with respect to our asphalt paving operations, could negatively impact Arcosa's performance and financial results.
Risks Related to Regulatory and Environmental Matters Our business is subject to significant regulatory compliance in the U.S., Mexico, and other countries where we do business, and any failure to comply with any current or future laws or regulations could have a material adverse effect on us. Arcosa’s Transportation Products segment is subject to regulation by, among others, the U.S.
Risks Related to Regulatory and Environmental Matters Our business is subject to significant regulatory compliance obligations in the U.S., Mexico, and other countries where we do business, and a failure to comply with any current or future laws or regulations could have a material adverse effect on us.
Increased inflation, including rising prices for raw materials such as steel, fuel, parts and components, freight, packaging, supplies, labor and energy, increases our costs to manufacture and distribute our products. We use market prices for materials, fuel, and parts and components, and may be unable to pass these rising costs on to our customers.
Increased inflation and volatile input costs may be beyond our control, including rising prices for raw materials such as steel, liquid asphalt, fuel, parts and components, freight, packaging, supplies, labor, and energy, increases our costs to manufacture and distribute our products. We may be unable to pass these rising costs on to our customers.
While Arcosa cannot predict the extent to which inflation may continue to increase, increases in the price of steel have and could continue to impact a customer's decision to place or delay orders for new barges or wind towers.
While Arcosa cannot predict the extent to which inflation may increase, increases and volatility in the 21 Table of Contents price of steel and liquid asphalt have and could impact a customer's decision to place or delay orders for new barges, wind towers, or asphalt paving.
The subjective nature and wide variety of frameworks and methods used by our stockholders and others to assess Arcosa’s sustainability strategy and progress; diversity, equity, and inclusion ("DEI") initiatives; and heightened governance standards could result in a negative perception by our stockholders or misrepresentation of Arcosa’s sustainability 25 Table of Contents goals and progress.
The subjective nature and wide variety of frameworks and methods used by our stockholders and others to assess Arcosa’s sustainability strategy and progress and heightened governance standards could result in a negative perception by our stockholders or misrepresentation by others of Arcosa’s sustainability goals and progress.
For example, if one or more of Arcosa’s facilities become subject to closure in connection with a public health emergency, the business as a whole could be materially affected. In addition, the impact of a government shutdown could have a material adverse effect on Arcosa's revenues, profits, and cash flows.
If any of Arcosa’s facilities become subject to closure from a public health emergency, the business as a whole could be materially affected. In addition, the impact of a government shutdown could have a material adverse effect on Arcosa's revenues, profits, and cash flows.
Any material failure, interruption of service, compromise of data security, or cybersecurity threat could adversely affect Arcosa’s relations with suppliers, customers, and regulators and place Arcosa in violation of data protection laws, rules, and regulations, and result in negative impacts to Arcosa’s market share, operations, and profitability.
Any material failure, interruption of service, compromise of data security, or cybersecurity threat or attack could adversely affect Arcosa’s relations with suppliers, customers, and regulators, and result in negative impacts to Arcosa’s market share, operations, and profitability.
Any future similar public health emergency could negatively impact our business in a number of ways, including the health of our employees and employee productivity, the availability and pricing of supplies and raw materials, our ability to fulfill customer orders, and the availability of our transportation and distribution networks.
Any future similar public health emergency could negatively impact our business, including the health and productivity of our employees, the availability and pricing of supplies and raw materials, our ability to fulfill customer orders, and the 20 Table of Contents availability of our transportation and distribution networks.
Manufacturing and construction sites are inherently dangerous workplaces. Arcosa’s manufacturing sites often put Arcosa’s employees and others in close proximity with large pieces of mechanized equipment, moving vehicles, chemical and manufacturing processes, heavy products and other items, and highly regulated materials. Unsafe work sites have the potential to increase employee turnover and raise Arcosa’s operating costs.
Arcosa’s manufacturing sites often put Arcosa’s employees and others in close proximity with large pieces of mechanized equipment, moving vehicles, chemical and manufacturing processes, heavy products and other items, and highly regulated materials. Unsafe work sites have the potential to increase employee turnover and raise Arcosa’s operating costs. Arcosa’s safety record can also impact Arcosa’s reputation.
The breach of any of these covenants 18 Table of Contents or restrictions could result in a default under the Financing Documents, our inability to access the liquidity provided by the Credit Agreement, and the acceleration of the indebtedness under the Financing Documents.
The breach of any of these covenants or restrictions could result in a default under the Financing Documents, our inability to access the liquidity provided by the revolving credit facility in the Credit Agreement, the acceleration of the indebtedness under the Financing Documents, and the foreclosure of the liens securing the indebtedness outstanding under the Credit Agreement.
Additionally, the recently enacted Inflation Reduction Act of 2022 (the "IRA") provides for certain manufacturing, production, and investment tax credit incentives, including new AMP tax credits for companies that domestically manufacture and sell clean energy equipment, like Arcosa Wind Towers.
For example, the IRA provides for certain manufacturing, production, and investment tax credit incentives, including AMP tax credits for companies that domestically manufacture and sell clean energy equipment, like Arcosa Wind Towers.
Furthermore, if the SEC's proposed climate disclosure requirements are adopted on substantially similar terms as proposed, we will be required to incur significant time and money to comply with the disclosure requirements and may be required to modify certain of our operations. These compliance costs could adversely impact our future business.
To the extent these climate disclosures survive and/or substantially similar ones are adopted in the future, we will be required to incur significant time and money to comply with the disclosure requirements and may be required to modify certain of our operations. These compliance costs could adversely impact our future business.
The success and viability of these operations depend on the accuracy of Arcosa’s reserve estimates, the costs of production and the ability to economically distribute the natural aggregates and specialty materials.
A part of the operations in Arcosa’s Construction Products segment includes the mining of natural aggregates and specialty materials reserves. The success and viability of these operations depend on the accuracy of Arcosa’s reserve estimates, the costs of production and the ability to economically distribute the natural aggregates and specialty materials.
These environmental permits are subject to modification, renewal, and/or revocation. Although Arcosa regularly monitors and reviews its operations, procedures, and policies for compliance with Arcosa’s environmental permits and related laws and regulations, the risk of environmental liability is inherent in the operation of Arcosa’s businesses.
Although Arcosa regularly monitors and reviews its operations, procedures, and policies for compliance with 25 Table of Contents Arcosa’s environmental permits and related laws and regulations, the risk of environmental liability is inherent in the operation of Arcosa’s businesses.
If forthcoming guidance interprets the AMP in a restrictive manner or if any benefits, credits, subsidies, or programs under the IRA are allowed to expire or are otherwise modified or discontinued, the demand for Arcosa’s products could decrease and/or the amount of AMP tax credits for which Arcosa may be eligible may be reduced, thereby creating the potential for a material adverse effect on Arcosa’s business and future financial results.
If any currently available tax benefits, tax credits, subsidies, or programs, including the AMP tax credits, are allowed to expire or are otherwise modified or repealed, the demand for Arcosa’s products could decrease and/or the amount of AMP tax credits or other tax benefits for which Arcosa or its contractual counterparties may be eligible may be reduced, thereby creating the potential for a material adverse effect on Arcosa’s business and future financial results.
Pandemics, epidemics, or other public health emergencies, as well as the governmental reaction thereto, may adversely affect Arcosa’s business. Arcosa’s business may be adversely affected if a pandemic, epidemic, or other public health emergency occurs. For example, the outbreak of COVID-19, including its variants, disrupted global trade, commerce, financial and credit markets, and daily life throughout the world.
Pandemics, epidemics, or other public health emergencies, as well as the governmental reaction thereto, may adversely affect Arcosa’s business. Arcosa’s business may be adversely affected if a pandemic, epidemic, or other public health emergency occurs. The outbreak of COVID-19, including its variants, disrupted local, state, national, and global economies.
Certain jurisdictions have, from time to time, experienced instances of civil unrest and hostilities, both internally and with neighboring countries. Rioting, military activity, terrorist attacks, or armed hostilities could cause our operations in such jurisdictions to be adversely affected or suspended. We generally do not have insurance for losses and interruptions caused by terrorist attacks, military conflicts, and wars.
Certain jurisdictions have, from time to time, experienced instances of civil unrest and hostilities, both internally and with neighboring countries. Rioting, military activity, terrorist attacks, or armed hostilities could cause our operations in such jurisdictions to be adversely 24 Table of Contents affected or suspended.
A significant portion of Arcosa’s business depends on the adequate supply of raw materials and numerous specialty and other parts and components at competitive prices. The principal material used in Arcosa’s manufacturing segments is steel.
A significant portion of Arcosa’s business depends on the adequate supply of raw materials and numerous specialty and other parts and components at competitive prices. The principal material used in Arcosa’s manufacturing segments is steel. The current U.S. presidential administration has proposed to significantly increase tariffs on foreign imports of steel and aluminum.
Arcosa's manufacturing operations partially depend on Arcosa's ability to obtain timely deliveries of raw materials, parts, and components in acceptable quantities and quality from Arcosa's suppliers. Certain raw materials, parts, and components for Arcosa's products are currently available from a limited number of suppliers and, as a result, Arcosa may have limited control over pricing, availability, and delivery schedules.
Certain raw materials, parts, and components for Arcosa's products are currently available from a limited number of suppliers and, as a result, Arcosa may have limited control over pricing, availability, and delivery schedules.
Arcosa’s inability to achieve satisfactory progress on its sustainability initiatives, like climate change related initiatives, reduced air emissions, water and waste management, DEI efforts, and improved safety, on a timely basis, or at all, or to meet the sustainability criteria of our stockholders and others could adversely affect Arcosa’s business.
Arcosa’s inability to achieve satisfactory progress on its sustainability initiatives and improved safety, on a timely basis, or at all, or to align with the sustainability criteria of our stockholders and others could adversely affect Arcosa’s business.
Cybersecurity incidents, whether with Arcosa or a third party, could disrupt our business and result in the compromise of confidential information.
Risks Related to Technology and Cybersecurity Information system failures, cyber incidents or security breaches, whether with Arcosa or a third party, could disrupt our business and result in the compromise of confidential, sensitive, or proprietary information.
Arcosa may use contract-specific purchasing practices, supplier commitments, contractual price escalation provisions, flexing between steel type, and other arrangements with Arcosa’s customers to mitigate the effect of this volatility on Arcosa’s operating profits. To the 16 Table of Contents extent that Arcosa does not have such arrangements in place, a change in steel prices could materially lower Arcosa’s profitability.
Arcosa may use contract-specific purchasing practices, supplier commitments, contractual price escalation provisions, flexing between steel type, and other arrangements with Arcosa’s customers to mitigate the effect of this volatility on Arcosa’s operating profits.
If we fail to adequately perform due diligence during the acquisition process, we may be subject to unexpected liabilities in connection with such transaction. Acquisitions and divestitures also bring risks that the counterparties to the transactions may fail to perform their obligations, which could result in costly litigation, divert management's attention and disrupt our business operations.
Acquisitions and divestitures also bring risks that the counterparties to the transactions may fail to perform their obligations, which could result in costly litigation, divert management's attention, and disrupt our business operations.
In addition, laws and regulations governing cybersecurity, data privacy and protection, and the unauthorized disclosure of confidential or protected information pose increasingly complex compliance challenges and potentially elevate costs, and any failure to comply with these laws and regulations could result in significant penalties and legal liability.
The laws and regulations governing cybersecurity, data privacy and protection, and the unauthorized disclosure of confidential or protected information pose increasingly complex compliance challenges and potentially elevate costs, and any actual or perceived failure to adequately address privacy and cybersecurity concerns or comply with applicable laws and regulations could result in significant penalties, legal liability, judgments and negative publicity; require us to change our business practices; increase the costs and complexity of compliance; and adversely affect our business.
The impacts of climate change and related regulations on our operations and the Company overall are highly uncertain and difficult to estimate, but such effects could be materially adverse to our business. Arcosa’s sustainability efforts may be costly or may not meet the public sentiments of our stockholders and others with respect to our sustainability practices and related public disclosures.
The impacts of climate change and related regulations on our operations and the Company overall are highly uncertain and difficult to estimate, but such effects could be materially adverse to our business.
Some of these proposals would require industries to meet new standards that may require substantial reductions in carbon emissions. There is also a potential for climate change legislation and regulation that could adversely impact the cost of certain manufacturing inputs, including the increasing cost of energy and electricity.
There is also a potential for climate change legislation and regulation that could adversely impact the cost of certain manufacturing inputs, including the increasing cost of energy and electricity.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe CIO and other experts, as necessary provide the Audit Committee quarterly updates that encompass a broad range of topics, including but not limited to: • Current cybersecurity threat landscape and emerging threats; • Status of ongoing cybersecurity initiatives and strategies; • Incident reports and learnings from unique cybersecurity events, including those of other companies; • Compliance status and efforts with regulatory requirements and industry standards; and • Benchmarked data on the performance of certain aspects of our cybersecurity program relative to our peers.
Biggest changeThe CISO and other experts, as necessary provide the Audit Committee quarterly updates that encompass a broad range of topics, including but not limited to: • Current and emerging cybersecurity threat landscape; • Status of ongoing cybersecurity initiatives and strategies; • Incident reports and learnings from unique cybersecurity events, including those of other companies; • Compliance status and efforts with regulatory requirements and industry standards; and • Benchmarked data on the performance of certain aspects of our cybersecurity program relative to our peers.
Risks from Cybersecurity Incidents Arcosa has not been subject to cybersecurity incidents that have materially affected, or are reasonably likely to materially affect the Company, its operations, or financial standing. 29 Table of Contents Governance Risk Management Personnel Arcosa's cybersecurity risk management program is overseen by management at multiple levels.
Risks from Cybersecurity Incidents Arcosa has not been subject to cybersecurity incidents that have materially affected, or are reasonably likely to materially affect the Company, its operations, or financial standing. 30 Table of Contents Governance Risk Management Personnel Arcosa's cybersecurity risk management program is overseen by management at multiple levels.
The CIO has over 40 years of leadership positions in the high tech and IT industries. He is experienced in detailed product and solution development as well as business process operations providing an understanding of how cybersecurity considerations intersect the business.
The CISO has over 40 years of leadership positions in the high tech and IT industries. He is experienced in detailed product and solution development as well as business process operations providing an understanding of how cybersecurity considerations intersect the business.
This plan includes immediate actions to mitigate the impact and long-term strategies for remediation and prevention of future incidents. Board of Director Oversight The Audit Committee of the Company's Board of Directors is responsible for overseeing the Company's cyber risk.
This plan includes immediate actions to mitigate the impact and long-term strategies for remediation and prevention of future incidents. Board of Director Oversight The Board's Audit Committee is responsible for overseeing the Company's cyber risk.
The Director of Information Security and Compliance at Arcosa has more than 20 years of experience architecting, designing, and deploying security solutions based on industrial frameworks. Monitor Cybersecurity Incidents The CIO and Director of Information Security are continually informed and updated about the latest developments in cybersecurity, including emerging threats and innovative risk management techniques.
The Senior Director of Information Security and Compliance at Arcosa has more than 20 years of experience architecting, designing, and deploying security solutions based on industrial frameworks. Monitor Cybersecurity Incidents The CISO and Senior Director of Information Security are continually informed and updated about the latest developments in cybersecurity, including emerging threats and innovative risk management techniques.
Arcosa's Chief Information Security Officer ("CIO") and Director of Information Security work closely with the IT department to continuously evaluate and address cybersecurity risks in alignment with business objectives, operational needs, and industry-accepted standards, such as the CIS Critical Security Controls and National Institute of Standards and Technology ("NIST") frameworks.
Arcosa's Chief Information Security Officer ("CISO") and Senior Director of Information Security work closely with the IT department to continuously evaluate and address cybersecurity risks in alignment with business objectives, operational needs, and industry-accepted standards, such as the CIS Critical Security Controls and National Institute of Standards and Technology ("NIST") frameworks.
In addition, the CIO provides updates to the full Board upon request or to update the Board of unique developments, such as regulatory updates or unique vulnerability developments. Our Board is composed of members with diverse expertise including risk management, technology, and finance, equipping them to oversee cybersecurity risks effectively.
In addition, the CISO provides updates to the full Board upon request and updates the Board on unique developments, such as regulatory updates or unique vulnerability developments. Our Board is composed of members with diverse expertise including risk management, technology, and finance, equipping them to oversee cybersecurity risks effectively.
The CIO and Director of Information Security play key roles in assessing, monitoring, and managing the Company's cybersecurity risks with support of dedicated information technology and security personnel. Both the CIO and Director of Information Security have been in their respective roles at Arcosa for 5 years.
The CISO and Senior Director of Information Security play key roles in assessing, monitoring, and managing the Company's cybersecurity risks with support of dedicated information technology and security personnel. Both the CISO and Senior Director of Information Security have been in their respective roles at Arcosa for over 6 years.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 31, 2023, the Company’s estimated proven and probable mineral reserves by major commodity group and geographic region are as follows: Estimated Mineral Reserves (million tons) Proven Probable Total Owned Leased Natural aggregates: Texas 181.4 18.9 200.3 70 % 30 % All other 303.0 280.0 583.0 24 % 76 % 484.4 298.9 783.3 36 % 64 % Specialty materials 334.2 84.9 419.1 72 % 28 % 818.6 383.8 1,202.4 48 % 52 % Quantities of mineral reserves were estimated from geologic analysis of exploration results and the application of economic and mining parameters appropriate to the individual deposits.
Biggest changeAs of December 31, 2024, the Company’s estimated mineral reserves by major commodity group and geographic region are as follows: Estimated Mineral Reserves (million tons) Proven Probable Total Owned Leased Natural aggregates: Texas 168.0 28.4 196.4 67 % 33 % All other 343.0 435.6 778.6 43 % 57 % 511.0 464.0 975.0 48 % 52 % Specialty materials 331.0 84.3 415.3 72 % 28 % 842.0 548.3 1,390.3 55 % 45 % Quantities of mineral reserves were estimated from geologic analysis of exploration results and the application of economic and mining parameters appropriate to the individual deposits.
The operations extract materials from surficial or near-surface alluvial and bedrock deposits. Mining methods utilized at our surface operations include conventional truck/shovel excavation and dredge mining. Our single underground mine in Pennsylvania utilizes mechanized room-and-pillar mining methods. 32 Table of Contents Processing operations to produce sand and gravel and crushed stone consist of mechanized crushing, washing, and sizing.
The operations extract materials from surficial or near-surface alluvial and bedrock deposits. Mining methods utilized at our surface operations include conventional truck/shovel excavation and dredge mining. Our single underground mine in Pennsylvania utilizes mechanized room-and-pillar mining methods. 33 Table of Contents Processing operations to produce sand and gravel and crushed stone consist of mechanized crushing, washing, and sizing.
As of December 31, 2023, the Company did not have any individually material mining properties. The terms “mineral resource,” “measured mineral resource,” “indicated mineral resource,” “inferred mineral resource,” “mineral reserve,” “proven mineral reserve,” and “probable mineral reserve,” whether singular or plural, are defined and used in accordance with S-K 1300.
As of December 31, 2024, the Company did not have any individually material mining properties. The terms “mineral resource,” “measured mineral resource,” “indicated mineral resource,” “inferred mineral resource,” “mineral reserve,” “proven mineral reserve,” and “probable mineral reserve,” whether singular or plural, are defined and used in accordance with S-K 1300.
Information about the total square footage of our facilities as of December 31, 2023 is as follows: Approximate Square Feet (1) Approximate Square Feet Located In (1) Owned Leased U.S. Non-U.S.
Information about the total square footage of our facilities as of December 31, 2024 is as follows: Approximate Square Feet (1) Approximate Square Feet Located In (1) Owned Leased U.S. Non-U.S.
In addition to our active operations, we control interests in 20 inactive and greenfield (undeveloped) mining properties. We also own and operate recycled aggregates (i.e., recycled concrete products) facilities which are not dependent on mineral reserves.
In addition to our active operations, we control interests in 23 inactive or greenfield (undeveloped) mining properties. We also own and operate recycled aggregates (i.e., recycled concrete products) facilities which are not dependent on mineral reserves.
The Company reports its mining operations primarily through the following commodity groupings: Natural Aggregates – includes operations which specialize in the production of sand, gravel, limestone, and stabilized material.
The Company reports its mining operations primarily through the following commodity groupings: Natural Aggregates – includes operations which specialize in the production of sand, gravel, crushed stone, and stabilized material.
The following table summarizes, by major commodity group, the annual production history over the preceding three years for our mining properties: Annual Production (million tons) 2023 2022 2021 Natural aggregates 27.5 26.8 24.4 Specialty materials 4.0 4.6 5.3 31.5 31.4 29.7 Our ownership or leasehold interest in our mining properties – both active and undeveloped – is 100%.
The following table summarizes, by major commodity group, the annual production history over the preceding three years for our mining properties: Annual Production (million tons) 2024 2023 2022 Natural aggregates 26.4 27.5 26.8 Specialty materials 4.0 4.0 4.6 30.4 31.5 31.4 Our ownership or leasehold interest in our mining properties – both active and undeveloped – is 100%.
We have obtained all material permits currently required to conduct our present mining operations. Mineral Reserves We controlled an estimated 1.2 billion tons of mineral reserves as of December 31, 2023.
We have obtained all material permits currently required to conduct our present mining operations. Mineral Reserves We controlled an estimated 1.4 billion tons of mineral reserves as of December 31, 2024.
Since specialty materials have a much wider, multi-state distribution area due to their higher value relative to their distribution costs as compared to natural aggregates, we do not group our specialty materials operations by geographic region. 31 Table of Contents Our active operations as of December 31, 2023 included 49 that produce and distribute natural aggregates and 13 that produce, process, and distribute specialty materials.
Since specialty materials have a much wider, multi-state distribution area due to their higher value relative to their distribution costs as compared to natural aggregates, we do not group our specialty materials operations by geographic region. 32 Table of Contents Our active operations as of December 31, 2024 included 54 that produce and distribute natural aggregates and 12 that produce, process, and distribute specialty materials.
For more information related to the risks associated with the estimates of mineral reserves and mineral resources, see Item 1A “ Risk Factor - Risks Related to our Business and Operations.” Mining Properties During the year ended December 31, 2023, we produced 31.5 million tons of natural aggregates and specialty materials from our mining and processing operations located in the United States and Canada, all of which, we believe, have adequate road and/or railroad access.
For more information related to the risks associated with the estimates of mineral reserves and mineral resources, see Item 1A “ Risk Factor - Risks Related to our Business and Operations.” Mining Properties During the year ended December 31, 2024, we produced 30.4 million tons of natural aggregates and specialty materials from our mining and processing operations located in the U.S. and Canada, all of which, we believe, have adequate road and/or railroad access.
Economic viability of the reported mineral reserves has been demonstrated using three-year trailing average product prices on a per-property basis. 33 Table of Contents Mineral Resources We controlled an estimated 117.3 million tons of mineral resources as of December 31, 2023, exclusive of our reported mineral reserves.
Economic viability of the reported mineral reserves has been demonstrated using three-year trailing average product prices on a per-property basis. 34 Table of Contents Mineral Resources We controlled an estimated 333 million tons of mineral resources as of December 31, 2024, exclusive of our reported mineral reserves.
(2) Includes processing facilities, quarries, and mines. Mineral Reserves - Overview Information concerning the Company’s mining properties has been prepared in accordance with the requirements of Subpart 1300 of Regulation S-K (“S-K 1300”), which first became applicable to the Company for the fiscal year ended December 31, 2021.
(2) Includes processing facilities, quarries, and mines. (3) Excludes the steel components business, which was sold in August 2024. Mineral Reserves - Overview Information concerning the Company’s mining properties has been prepared in accordance with the requirements of Subpart 1300 of Regulation S-K (“S-K 1300”), which first became applicable to the Company for the fiscal year ended December 31, 2021.
Our mineral resource estimates are based on an initial assessment using average selling price assumptions ranging from $7.02 to $119.57 per ton, depending on the location and market.
Our mineral resource estimates are based on an initial assessment using average selling price assumptions ranging from $7.96 to $134.23 per ton, depending on the location and market.
However, certain operations may have more limited reserves and may not be able to expand. Approximately 969 million tons or 81% of the reported mineral reserves are attributable to active mining operations.
However, certain operations may have more limited reserves and may not be able to expand. Approximately 1.1 billion tons or 83% of the reported mineral reserves are attributable to active mining operations.
Mineral resources, that are not mineral reserves, do not have a demonstrated economic viability at this time; however, of the 77.9 million tons of inferred mineral resources, 29.4 million tons or 38% are attributable to 10 active mining operations. Item 3. Legal Proceedings. See Note 15 of the Consolidated Financial Statements regarding legal proceedings.
Mineral resources, that are not mineral reserves, do not have a demonstrated economic viability at this time; however, of the 249.1 million tons of inferred mineral resources, 200.5 million tons or 81% are attributable to 20 active mining operations. Item 3. Legal Proceedings. See Note 15 of the Consolidated Financial Statements regarding legal proceedings.
The economic viability of our reserves was determined using average selling prices ranging from $3.00 to $104.14 per ton, depending on the location and market. Our mineral reserves, on average, represent approximately 30 years at current production levels within the natural aggregates business and approximately 105 years at current production levels within the specialty materials business.
The economic viability of our reserves was determined using average selling prices ranging from $8.07 to $106.18 per ton, depending on the location and market. Our mineral reserves, on average, represent approximately 40 years at current production levels within the natural aggregates business and approximately 110 years at current production levels within the specialty materials business.
Reported mineral reserves include only quantities that are owned in fee or under lease – approximately 581 million tons or 48% are located on owned land and 621 million tons or 52% are located on leased land.
Reported mineral reserves include only quantities that are owned in fee or under lease – approximately 765 million tons or 55% are located on owned land and approximately 625 million tons or 45% are located on leased land.
The following table summarizes our mineral resources by major commodity group and geographic region as of December 31, 2023: Estimated Mineral Resources (million tons) Measured Indicated Inferred Total Natural aggregates: Texas 1.1 1.1 18.8 21.0 All other 6.5 7.2 9.8 23.5 7.6 8.3 28.6 44.5 Specialty materials 23.5 — 49.3 72.8 31.1 8.3 77.9 117.3 Our inferred mineral resources have been estimated on the basis of limited geologic evidence.
The following table summarizes our mineral resources by major commodity group and geographic region as of December 31, 2024: Estimated Mineral Resources (million tons) Measured Indicated Inferred Total Natural aggregates: Texas 2.3 5.5 24.2 32.0 All other — 52.7 175.8 228.5 2.3 58.2 200.0 260.5 Specialty materials 23.5 — 49.1 72.6 25.8 58.2 249.1 333.1 Our inferred mineral resources have been estimated on the basis of limited geologic evidence.
The following map illustrates the locations of our active mining operations as of December 31, 2023, excluding stand-alone processing facilities: The following table summarizes, by major commodity group and geographic region, the status for our mining properties as of December 31, 2023: Number of Properties Producing Inactive Total Natural aggregates: Texas 27 8 35 All other 22 8 30 49 16 65 Specialty materials 13 4 17 62 20 82 Our active mining operations include 61 surface mines and one underground mine.
The following map illustrates the locations of our active mining operations as of December 31, 2024, excluding stand-alone processing facilities: The following table summarizes, by major commodity group and geographic region, the status for our mining properties as of December 31, 2024: Number of Properties Producing Inactive Total Natural aggregates: Texas 24 10 34 All other 30 8 38 54 18 72 Specialty materials 12 5 17 66 23 89 Our active mining operations include 65 surface mines and one underground mine.
Construction Products 772,900 382,300 1,143,600 11,600 Engineered Structures 1,860,400 301,800 1,501,600 660,600 Transportation Products 1,802,500 81,100 1,883,600 — Corporate — 39,800 39,800 — 4,435,800 805,000 4,568,600 672,200 (1) Excludes non-operating facilities. 30 Table of Contents Our estimated weighted average production capacity utilization for the twelve-month period ended December 31, 2023 is reflected by the following percentages: Production Capacity Utilized (1) Construction Products (2) 70 % Engineered Structures 70 % Transportation Products 45 % (1) Excludes non-operating facilities.
Construction Products 837,200 357,600 1,183,200 11,600 Engineered Structures 2,359,000 371,300 2,069,700 660,600 Transportation Products 731,100 81,000 812,100 — Corporate — 39,800 39,800 — 3,927,300 849,700 4,104,800 672,200 (1) Excludes non-operating facilities. 31 Table of Contents Our estimated weighted average production capacity utilization for the twelve-month period ended December 31, 2024 is reflected by the following percentages: Production Capacity Utilized (1) Construction Products (2) 70 % Engineered Structures 75 % Transportation Products (3) 40 % (1) Excludes non-operating facilities.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures. The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this Form 10-K. 34 Table of Contents PART II
Biggest changeItem 4. Mine Safety Disclosures. The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this Form 10-K. 35 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAll rights reserved. 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 Arcosa, Inc. $ 100 $ 162 $ 201 $ 193 $ 200 $ 305 S&P Small Cap 600 Index $ 100 $ 123 $ 137 $ 173 $ 145 $ 169 S&P Small Cap 600 Construction & Engineering Industry Index $ 100 $ 132 $ 151 $ 218 $ 221 $ 353 36 Table of Contents Issuer Purchases of Equity Securities This table provides information with respect to purchases by the Company of shares of its common stock during the quarter ended December 31, 2023: Period Number of Shares Purchased (1) Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (2) October 1, 2023 through October 31, 2023 184 $ 67.08 — $ 50,000,000 November 1, 2023 through November 30, 2023 201,322 $ 68.76 200,000 $ 36,247,953 December 1, 2023 through December 31, 2023 1,935 $ 83.39 — $ 36,247,953 Total 203,441 $ 68.90 200,000 $ 36,247,953 (1) These columns include the following transactions during the three months ended December 31, 2023: (i) the surrender to the Company of 3,441 shares of common stock to satisfy tax withholding obligations in connection with the vesting of restricted stock issued to employees and (ii) the purchase of 200,000 shares of common stock on the open market as part of the stock repurchase program.
Biggest changeAll rights reserved. 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Arcosa, Inc. $ 100 $ 124 $ 119 $ 123 $ 188 $ 221 S&P Small Cap 600 Index $ 100 $ 111 $ 141 $ 118 $ 137 $ 149 S&P Small Cap 600 Construction & Engineering Industry Index $ 100 $ 115 $ 165 $ 168 $ 268 $ 374 Russell 3000 Index Construction and Materials Sector $ 100 $ 125 $ 179 $ 143 $ 216 $ 270 37 Table of Contents Issuer Purchases of Equity Securities This table provides information with respect to purchases by the Company of shares of its common stock during the quarter ended December 31, 2024: Period Number of Shares Purchased (1) Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (2) October 1, 2024 through October 31, 2024 318 $ 94.38 — $ 36,247,953 November 1, 2024 through November 30, 2024 1,031 $ 101.53 — $ 36,247,953 December 1, 2024 through December 31, 2024 64 $ 100.77 — $ 36,247,953 Total 1,413 $ 99.89 — $ 36,247,953 (1) These columns include the surrender to the Company of 1,413 shares of common stock to satisfy tax withholding obligations in connection with the vesting of restricted stock issued to employees and do not include any purchases of common stock on the open market as part of the share repurchase program during the three months ended December 31, 2024.
Arcosa cannot guarantee that it will continue to pay any dividend in the future. 35 Table of Contents Performance Graph The following Performance Graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or Securities Exchange Act of 1934, each as amended, except to the extent that the Company specifically incorporates it by reference into such filing.
Arcosa cannot guarantee that it will continue to pay any dividend in the future. 36 Table of Contents Performance Graph The following Performance Graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or Securities Exchange Act of 1934, each as amended, except to the extent that the Company specifically incorporates it by reference into such filing.
Dividends The timing, declaration, amount, and payment of future dividends to Arcosa's stockholders falls within the discretion of the Board of Directors.
Dividends The timing, declaration, amount, and payment of future dividends to Arcosa's stockholders falls within the discretion of the Board.
The data in the graph assumes $100 was invested in each index at the closing price on December 31, 2018 and assumes the reinvestment of dividends. Copyright Standard and Poor’s, Inc. Used with permission.
The data in the graph assumes $100 was invested in each index at the closing price on December 31, 2019 and assumes the reinvestment of dividends. Copyright Standard and Poor’s, Inc. Used with permission.
The Board of Directors' decisions regarding the payment of future dividends will depend on many factors, such as Arcosa's financial condition, earnings, capital requirements, debt service obligations, covenants related to our debt service obligations, industry practice, legal requirements, regulatory constraints, access to the capital markets, and other factors that the Board of Directors deems relevant.
The Board's decisions regarding the payment of future dividends will depend on many factors, such as Arcosa's financial condition, earnings, capital requirements, debt service obligations, covenants related to our debt service obligations, industry practice, legal requirements, regulatory constraints, access to the capital markets, and other factors that the Board deems relevant.
Holders At December 31, 2023, we had 996 record holders of common stock. Because many of our shares are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.
Holders At December 31, 2024, we had 895 record holders of common stock. Because many of our shares are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Shares of our common stock are listed on the New York Stock Exchange under the ticker symbol “ACA,” which began “regular-way” trading on November 1, 2018. Our transfer agent and registrar is American Stock Transfer & Trust Company.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Shares of our common stock are listed on the New York Stock Exchange under the ticker symbol “ACA,” which began “regular-way” trading on November 1, 2018. Our transfer agent and registrar is Broadridge Corporate Issuer Solutions, LLC.
The following graph compares the Company's cumulative total stockholder return during the five-year period ended December 31, 2023 with the S&P Small Cap 600 Index and the S&P Small Cap 600 Construction & Engineering Industry Index.
The following graph compares the Company's cumulative total stockholder return during the five-year period ended December 31, 2024 with the S&P Small Cap 600 Index, S&P Small Cap 600 Construction & Engineering Industry Index (the "Old Peer Group"), and the Russell 3000 Index Construction and Materials Sector (the "Peer Group").
(2) In December 2022, the Company’s Board of Directors authorized a new $50.0 million share repurchase program effective January 1, 2023 through December 31, 2024 to replace a program of the same amount that expired on December 31, 2022. During the year ended December 31, 2023, the Company repurchased 200,000 shares at a cost of $13.8 million.
(2) In December 2024, the Board authorized a new $50.0 million share repurchase program effective January 1, 2025 through December 31, 2026 to replace a program of the same amount that expired on December 31, 2024.
Under the previous program, the Company repurchased 298,629 shares at a cost of $15.0 million during the year ended December 31, 2022. As of December 31, 2023, the Company has approximately $36.2 million available for share repurchases under the current program. Item 6 . Reserved. 37 Table of Contents
Under the previous program, the Company did not repurchase any shares during the year ended December 31, 2024, and repurchased 200,000 shares at a cost of $13.8 million during the year ended December 31, 2023. Item 6 . Reserved. 38 Table of Contents
Added
To better align with the strategic transformation of Arcosa's portfolio as a result of the recent acquisitions and divestitures, we changed the peer group used for purposes of the performance graph disclosure from the Old Peer Group to the Peer Group.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeExcluding the $189.0 million gain on the sale of our storage tanks business within Engineered Structures, operating costs increased 8.0%. • Cost of revenues for Construction Products increased primarily due to inflationary-related cost increases, including diesel, cement, and process fuels and higher volumes from recently acquired businesses. • Excluding the gain from the sale of the storage tanks business, operating costs for Engineered Structures increased primarily due to higher steel raw material prices. • Cost of revenues for Transportation Products increased primarily due to increased steel component volumes and higher steel raw material costs in inland barges. • Depreciation, depletion, and amortization increased primarily due to recent acquisitions, including the fair value mark up of long-lived assets. • As a percentage of revenue, selling, general, and administrative expenses for the year ended December 31, 2022 was 11.7% compared to 12.6% for the year ended December 31, 2021.
Biggest changeYear Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 (in millions) Construction Products $ 971.2 $ 862.7 $ 827.0 12.6 % 4.3 % Engineered Structures 920.9 777.8 695.0 18.4 11.9 Transportation Products 387.4 387.7 305.8 (0.1) 26.8 Segment Totals before Eliminations and Corporate Expenses 2,279.5 2,028.2 1,827.8 12.4 11.0 Corporate 92.9 62.8 66.0 47.9 (4.8) Eliminations (0.1) (0.4) — Consolidated Total $ 2,372.3 $ 2,090.6 $ 1,893.8 13.5 10.4 Depreciation, depletion, and amortization $ 195.0 $ 159.5 $ 154.1 22.3 3.5 2024 versus 2023 • Operating costs increased 13.5%. • Operating costs for Construction Products increased primarily due to additional costs from recently acquired businesses, including the fair value markup of acquired inventory and long-lived assets, and a $21.8 million gain recognized on the sale of depleted land that was netted against operating costs in the prior period. • Operating costs for Engineered Structures increased primarily due to higher volumes in our wind towers and utility structures businesses and increased costs from the acquired Ameron business. • Operating costs for Transportation Products were substantially unchanged as higher barge volumes and the $21.6 million loss recognized on the sale of steel components were mostly offset by lower steel components volumes. • Depreciation, depletion, and amortization increased due to recent acquisitions and organic growth investments. • As a percentage of revenues, selling, general, and administrative expenses for the year ended December 31, 2024 was 12.5% compared to 11.3% for the year ended December 31, 2023, driven by increased costs from recently acquired businesses and higher acquisition and divestiture-related transaction expenses. 2023 versus 2022 • Operating costs increased 10.4%.
These costs were partially offset by a $5 million reduction in a holdback obligation owed on a previous acquisition. As a percent of revenues, cost of revenues decreased to 78.3% in current period, compared to 79.7% in the prior period. • Selling, general, and administrative expenses increased 6.6%, driven by additional costs from recently acquired businesses.
These costs were partially offset by a $5 million reduction in a holdback obligation owed on a previous acquisition. As a percent of revenues, cost of revenues decreased to 78.3% in the current period, compared to 79.7% in the prior period. • Selling, general, and administrative expenses increased 6.6%, driven by additional costs from recently acquired businesses.
Net cash required by investing activities for the year ended December 31, 2023 was $285.8 million compared to net cash provided by investing activities of $90.7 million for the year ended December 31, 2022. • Capital expenditures for the year ended December 31, 2023 increased to $203.5 million compared to $138.0 million for the year ended December 31, 2022 with the increase primarily driven by investments in two new facilities supporting expansion in our wind tower and utility structures businesses as well as various growth projects in the Construction Products segment. • Proceeds from the sale of property, plant, and equipment and other assets totaled $36.6 million for the year ended December 31, 2023 compared to $32.2 million for the year ended December 31, 2022. • Cash paid for acquisitions, net of cash acquired, was $120.9 million for the year ended December 31, 2023 compared to $75.1 million for the year ended December 31, 2022. • Proceeds from the sale of the storage tanks business was $2.0 million during the year ended December 31, 2023, which was related to the resolution of certain contingencies from the sale, compared to $271.6 million during the year ended December 31, 2022.
Net cash required by investing activities for the year ended December 31, 2023 was $285.8 million compared to net cash provided of $90.7 million for the year ended December 31, 2022. • Capital expenditures for the year ended December 31, 2023 increased to $203.5 million compared to $138.0 million for the year ended December 31, 2022 with the increase primarily driven by investments in two new facilities supporting expansion in our wind tower and utility structures businesses as well as various growth projects in the Construction Products segment. • Proceeds from the sale of property, plant, and equipment and other assets totaled $36.6 million for the year ended December 31, 2023 compared to $32.2 million for the year ended December 31, 2022. • Cash paid for acquisitions, net of cash acquired, was $120.9 million for the year ended December 31, 2023 compared to $75.1 million during for the year ended December 31, 2022. • Proceeds from the sale of the storage tanks business was $2.0 million during the year ended December 31, 2023, which was related to the resolution of certain contingencies from the sale, compared to $271.6 million during the year ended December 31, 2022.
Revenues from our trench shoring business increased 18.9%, driven by revenue from the acquisition completed in the first quarter of 2023 and higher organic volumes. • Cost of revenues increased 6.5%, due to increased costs from the acquired shoring business, higher recycled aggregates volumes, and operating inefficiencies in our specialty materials business.
Revenues from our trench shoring business increased 18.9%, driven by the acquisition completed in the first quarter of 2023 and higher organic volumes. • Cost of revenues increased 6.5%, due to increased costs from the acquired shoring business, higher recycled aggregates volumes, and operating inefficiencies in our specialty materials business.
Business Combinations and Allocation of Purchase Price We account for business combinations under the acquisition method of accounting. As of the date that control in the entity is obtained, the purchase price of the transaction is allocated to the identifiable assets acquired and liabilities assumed based on their estimated fair values.
Business Combinations We account for business combinations under the acquisition method of accounting. As of the date that control in the entity is obtained, the purchase price of the transaction is allocated to the identifiable assets acquired and liabilities assumed based on their estimated fair values.
Additionally, variations in any of these assumptions may result in different calculations in fair value that could result in an impairment charge. A 100 basis point increase in the discount rate or reduction in the terminal growth rate would not have resulted in an impairment of goodwill for any of our reporting units as of October 1, 2023.
Additionally, variations in any of these assumptions may result in different calculations in fair value that could result in an impairment charge. A 100 basis point increase in the discount rate or reduction in the terminal growth rate would not have resulted in an impairment of goodwill for any of our reporting units as of October 1, 2024.
The passage of the IRA on August 16, 2022, which included a long-term extension of the PTC for new wind farm projects and introduced new AMP tax credits for companies that domestically manufacture and sell clean energy equipment in the U.S., is a significant catalyst for our wind towers business.
The passage of the IRA in August 2022, which included a long-term extension of the PTC for new wind farm projects and introduced new AMP tax credits for companies that domestically manufacture and sell clean energy equipment in the U.S., is a significant catalyst for our wind towers business.
Potential factors, which could cause our actual results of operations to differ materially from those in the forward-looking statements include, among others: • the impact of pandemics, epidemics, or other public health emergencies on our sales, operations, supply chain, employees, and financial condition; • market conditions and customer demand for our business products and services; • the cyclical and seasonal nature of the industries in which we compete; • variations in weather in areas where our construction products are sold, used, or installed; • naturally occurring events and other events and disasters causing disruption to our manufacturing, product deliveries, and production capacity, thereby giving rise to an increase in expenses, loss of revenue, and property losses; • competition and other competitive factors; • our ability to identify, consummate, or integrate acquisitions of new businesses or products, or divest any business; • the timing of introduction of new products; • the timing and delivery of customer orders or a breach of customer contracts; • the credit worthiness of customers and their access to capital; • product price changes; • changes in mix of products sold; • the costs incurred to align manufacturing capacity with demand and the extent of its utilization; • the operating leverage and efficiencies that can be achieved by our manufacturing businesses; • availability and costs of steel, component parts, supplies, and other raw materials; • changing technologies; • surcharges and other fees added to fixed pricing agreements for steel, component parts, supplies and other raw materials; • increased costs due to increased inflation; • interest rates and capital costs; • counter-party risks for financial instruments; • long-term funding of our operations; • taxes; • material nonpayment or nonperformance by any of our key customers; • the stability of the governments and political and business conditions in certain foreign countries, particularly Mexico; • public infrastructure expenditures; • changes in import and export quotas and regulations; • business conditions in emerging economies; • costs and results of litigation; • changes in accounting standards or inaccurate estimates or assumptions in the application of accounting policies; • legal, regulatory, and environmental issues, including compliance of our products with mandated specifications, standards, or testing criteria and obligations to remove and replace our products following installation or to recall our products and install different products manufactured by us or our competitors; • actions by the executive and legislative branches of the U.S. government relative to federal government budgeting, taxation policies, government expenditures, U.S. borrowing/debt ceiling limits, and trade policies, including tariffs, and border closures; • the inability to sufficiently protect our intellectual property rights; • our ability to mitigate against cybersecurity incidents, including ransomware, malware, phishing emails, and other electronic security threats; • if the Company's sustainability efforts are not favorably received by stockholders; 53 Table of Contents • if the Company does not realize some or all of the benefits expected from certain provisions of the IRA, including the AMP tax credits for wind towers, which remain subject to the issuance of additional guidance and clarification; and • the delivery or satisfaction of any backlog or firm orders.
Potential factors, which could cause our actual results of operations to differ materially from those in the forward-looking statements include, among others: • the impact of pandemics, epidemics, or other public health emergencies on our sales, operations, supply chain, employees, and financial condition; • market conditions and customer demand for our business products and services; • the cyclical and seasonal nature of the industries in which we compete; • variations in weather in areas where our construction products are sold, used, or installed; • naturally occurring events and other events and disasters causing disruption to our manufacturing, product deliveries, and production capacity, thereby giving rise to an increase in expenses, loss of revenue, and property losses; • competition and other competitive factors; • our ability to identify, consummate, or integrate acquisitions of new businesses or products, or divest any business; • the timing of introduction of new products; • the timing and delivery of customer orders or a breach of customer contracts; • the credit worthiness of customers and their access to capital; • product price changes; • changes in mix of products sold; • the costs incurred to align manufacturing capacity with demand and the extent of its utilization; • the operating leverage and efficiencies that can be achieved by our manufacturing businesses; • availability and costs of steel, component parts, supplies, and other raw materials; • changing technologies; • surcharges and other fees added to fixed pricing agreements for steel, component parts, supplies and other raw materials; • increased costs due to inflation or tariffs; • interest rates and capital costs; • counter-party risks for financial instruments; • our indebtedness or leverage levels; • long-term funding of our operations; • taxes; • costs and availability of sufficient insurance coverage; • material nonpayment or nonperformance by any of our key customers; • the stability of the governments and political and business conditions in certain foreign countries, particularly Mexico; • public infrastructure expenditures; • changes in import and export quotas and regulations; • business conditions in emerging economies; • costs and results of litigation; • changes in accounting standards or inaccurate estimates or assumptions in the application of accounting policies; • legal, regulatory, and environmental issues, including compliance of our products with mandated specifications, standards, or testing criteria and obligations to remove and replace our products following installation or to recall our products and install different products manufactured by us or our competitors; • actions by the executive and legislative branches of the U.S. government relative to federal government budgeting, taxation policies, government expenditures, U.S. borrowing/debt ceiling limits, and trade policies, including tariffs, and border closures; • our ability to sufficiently protect our intellectual property rights; • our ability to mitigate against cybersecurity incidents, including ransomware, malware, phishing emails, and other electronic security threats; • if the Company's sustainability efforts are not favorably received by stockholders; 55 Table of Contents • if the Company does not realize some or all of the benefits expected from certain provisions of the IRA, including the AMP tax credits for wind towers; and • the delivery or satisfaction of any backlog or firm orders.
We have been successful in managing inflationary cost pressures through proactive price increases. • Within our Engineered Structures segment, our backlog as of December 31, 2023 provides good production visibility for 2024. Our customers remain committed to taking delivery of these orders.
We have been successful in managing inflationary cost pressures through proactive price increases. • Within our Engineered Structures segment, our backlog as of December 31, 2024 provides good production visibility for 2025. Our customers remain committed to taking delivery of these orders.
Based on the Company's annual goodwill impairment test, performed at the reporting unit level as of October 1, 2023, the Company concluded that no impairment charges were determined to be necessary and that none of the reporting units evaluated were at risk of failing the goodwill impairment test.
Based on the Company's annual goodwill impairment test, performed at the reporting unit level as of October 1, 2024, the Company concluded that no impairment charges were determined to be necessary and that none of the reporting units evaluated were at risk of failing the goodwill impairment test.
For a discussion of risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, see Item 1A, “ Risk Factors ” included elsewhere herein. 54 Table of Contents
For a discussion of risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, see Item 1A, “ Risk Factors ” included elsewhere herein. 56 Table of Contents
Selling, general, and administrative expenses for utility, wind, and related structures increased largely due to higher compensation-related costs. • The divestiture of the storage tanks business resulted in a net decrease in operating profit of $223.7 million due to an additional gain on sale of $6.4 million recorded in the first quarter of 2023 compared to $230.1 million of operating profit in the prior year.
Selling, general, and administrative expenses for utility, wind, and related structures increased largely due to higher compensation-related costs. 46 Table of Contents • The divestiture of the storage tanks business resulted in a net decrease in operating profit of $223.7 million due to an additional gain on sale of $6.4 million recorded in the first quarter of 2023 compared to $230.1 million of operating profit for the storage tanks business in the prior year.
Net cash required by financing activities for the year ended December 31, 2023 was $30.8 million compared to $177.5 million of net cash required by financing activities for the year ended December 31, 2022. • During the year ended December 31, 2023, the Company received net proceeds from borrowings under its revolving credit facility and term loan of $23.2 million, which was used to partially finance the Lake Point acquisition in the fourth quarter of 2023.
Net cash required by financing activities during the year ended December 31, 2023 was $30.8 million compared to $177.5 million for the year ended December 31, 2022. 49 Table of Contents • During the year ended December 31, 2023, the Company received net proceeds from borrowings under its revolving credit facility and term loan of $23.2 million, which was used to partially finance the Lake Point acquisition in the fourth quarter of 2023.
Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risks involved or market quotes as available. Significant estimates and judgments that most significantly impact the impairment analysis may include projected revenues, operating profit, and the remaining useful life over which the asset or asset group is expected to generate cash flows.
Fair value is determined primarily using the estimated future cash flows discounted at a rate commensurate with the risks involved or market quotes as available. Significant estimates and judgments that most significantly impact the impairment analysis may include projected revenues, operating profit, and the remaining useful life over which the asset or asset group is expected to generate cash flows.
Employee Retirement Plans In 2023, we sponsored an employee savings plan under the 401(k) plan that covered substantially all employees and included a company matching contribution with the investment of the funds directed by the participants.
Employee Retirement Plans In 2024, we sponsored an employee savings plan under the 401(k) plan that covered substantially all employees and included a company matching contribution with the investment of the funds directed by the participants.
The determination of the acquisition date fair value of the assets acquired and liabilities assumed requires management's judgment and involves the use of significant estimates and assumptions, especially with respect to future expected cash flows, useful lives, and discount rates.
The determination of the acquisition date fair value of the assets acquired and liabilities assumed requires management's judgment and involves the use of significant estimates and assumptions, especially with respect to future expected cash flows and discount rates.
Excluding the impact of the storage tanks divestiture on both periods, operating costs increased 8.4%. • Operating costs for Construction Products increased primarily due to additional costs from recently acquired businesses and operating inefficiencies in our specialty materials business, partially offset by an increase in gains recognized on the sale of depleted land. • Operating costs for utility, wind, and related structures within Engineered Structures increased primarily due to higher volumes in our utility structures business, partially offset by lower volumes and AMP tax credits in our wind towers business. • Operating costs for Transportation Products increased primarily due to higher volumes in inland barge and steel components. • Depreciation, depletion, and amortization increased due to recent acquisitions and organic growth investments, partially offset by the impact of the storage tanks divestiture. • As a percentage of revenue, selling, general, and administrative expenses for the year ended December 31, 2023 was 11.3% compared to 11.7% for the year ended December 31, 2022.
Excluding the impact of the storage tanks divestiture on both periods, operating costs increased 8.4%. • Operating costs for Construction Products increased primarily due to additional costs from recently acquired businesses and operating inefficiencies in our specialty materials business, partially offset by an increase in gains recognized on the sale of depleted land. • Operating costs for utility, wind, and related structures within Engineered Structures increased primarily due to higher volumes in our utility structures business, partially offset by lower volumes and AMP tax credits in our wind towers business. • Operating costs for Transportation Products increased primarily due to higher volumes in barge and steel components. • Depreciation, depletion, and amortization increased due to recent acquisitions and organic growth investments, partially offset by the impact of the storage tanks divestiture. 42 Table of Contents • As a percentage of revenues, selling, general, and administrative expenses for the year ended December 31, 2023 was 11.3% compared to 11.7% for the year ended December 31, 2022.
For additional information, see Note 10 to the Notes to Consolidated Financial Statements. 51 Table of Contents Recent Accounting Pronouncements See Note 1 to the Consolidated Financial Statements for information about recent accounting pronouncements. 52 Table of Contents Forward-Looking Statements This annual report on Form 10-K (or statements otherwise made by the Company or on the Company’s behalf from time to time in other reports, filings with the SEC, news releases, conferences, internet postings or otherwise) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Recent Accounting Pronouncements See Note 1 to the Consolidated Financial Statements for information about recent accounting pronouncements. 54 Table of Contents Forward-Looking Statements This annual report on Form 10-K (or statements otherwise made by the Company or on the Company’s behalf from time to time in other reports, filings with the SEC, news releases, conferences, internet postings, or otherwise) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
This assessment considers, among other matters, the nature, frequency, and severity of recent losses; a forecast of future profitability; the duration of statutory carryback and carryforward periods; the Company’s experience with tax attributes expiring unused; and tax planning alternatives. As of December 31, 2023, the Company's adjusted net deferred tax liability was $172.8 million.
This assessment considers, among other matters, the nature, frequency, and severity of recent losses; a forecast of future profitability; the duration of statutory carryback and carryforward periods; the Company’s experience with tax attributes expiring unused; and tax planning alternatives. As of December 31, 2024, the Company's adjusted net deferred tax liability was $197.8 million.
The effective tax rates differ from the federal tax rate of 21.0% due to AMP tax credits, tax effects of foreign currency translations, state income taxes, prior year true-ups, and statutory depletion deductions.
The effective tax rates differ from the federal tax rate of 21.0% due to AMP tax credits, state income taxes, tax effects of foreign currency translations, prior year true-ups, tax effects of the disposal of nondeductible goodwill, and statutory depletion deductions.
The current year activity was primarily driven by increased inventories due to higher volumes and increased receivables due to the recognition of AMP tax credits, partially offset by increased accounts payable. 46 Table of Contents Investing Activities.
The current year activity was primarily driven by increased inventories due to higher volumes and increased receivables due to the recognition of AMP tax credits, partially offset by increased accounts payable. Investing Activities.
As a percentage of revenues, selling, general, and administrative costs decreased to 10.7% compared to 10.9% in the previous year. • Operating profit increased by 43.6%, partially due to gain recognized on the sales of depleted land.
As a percent of revenues, selling, general, and administrative costs decreased to 10.7% compared to 10.9% in the previous year. • Operating profit increased by 43.6%, partially due to a gain recognized on the sale of depleted land.
The Company used $155.0 million of cash proceeds from the sale of the storage tanks business in the fourth quarter of 2022 to repay all amounts then borrowed under its revolving credit facility. • Dividends paid during the year ended December 31, 2023 were $9.8 million, unchanged from the prior year. • The Company paid $13.8 million during the year ended December 31, 2023 to repurchase common stock under the share repurchase program in effect at the time compared to $15.0 million paid during the year ended December 31, 2022. 2022 versus 2021 Operating Activities.
The Company used $155.0 million of cash proceeds from the sale of the storage tanks business in the fourth quarter of 2022 to repay all amounts then borrowed under its revolving credit facility. • Dividends paid during the year ended December 31, 2023 were $9.8 million, unchanged from the prior year. • The Company paid $13.8 million during the year ended December 31, 2023 to repurchase common stock under its share repurchase program compared to $15.0 million paid during the year ended December 31, 2022.
The interest rates under the revolving credit facility are variable based on the daily simple or term Secured Overnight Financing Rate ("SOFR"), plus a 10-basis point credit spread adjustment, or an alternate base rate, in each case plus a margin for borrowing. A commitment fee accrues on the average daily unused portion of the revolving facility.
The interest rates for revolving loans under the Credit Agreemen t are variable based on the daily simple or term SOFR, plus a 10-basis point credit spread adjustment, or an alternate base rate, in each case plus a margin for borrowing. A commitment fee accrues on the average daily unused portion of the revolving credit facility.
The carrying value of long-lived assets to be held and used is considered impaired when the carrying value is not recoverable through undiscounted future cash flows and the fair value of the asset or asset group is less than their carrying value.
The carrying value of long-lived assets is considered impaired when the carrying value is not recoverable through undiscounted future cash flows and the fair value of the asset or asset group is less than their carrying value.
In conjunction with the replacement of LIBOR with SOFR as a benchmark for borrowings under the Amended and Restated Credit Agreement, on July 1, 2023, the swap instrument transitioned from LIBOR to SOFR. The instrument effectively fixed the SOFR component of borrowings under the revolving credit facility at a monthly rate of 2.71% until such instrument's termination.
In conjunction with the replacement of LIBOR with SOFR as a benchmark for borrowings under our credit facility, on July 1, 2023 the swap instrument transitioned from LIBOR to SOFR. The instrument effectively fixed the SOFR component of borrowings under our credit facility at a monthly rate of 2.71% until such instrument's termination.
We include results of operations from acquired businesses in our Consolidated Financial Statements from the effective date of the acquisition. Long-lived Assets As of December 31, 2023, net property, plant, and equipment and net intangible assets represent 37% and 8% of the Company's total assets, respectively.
We include results of operations from acquired businesses in our Consolidated Financial Statements from the effective date of the acquisition. Long-lived Assets As of December 31, 2024, property, plant, and equipment, net and intangible assets, net represent 43% and 7% of the Company's total assets, respectively.
The Notes are senior unsecured obligations of the Company and are guaranteed on a senior unsecured basis by each of the Company’s domestic subsidiaries that is a guarantor under our revolving credit and term loan facilities.
The Senior Notes are senior unsecured obligations of the Company and are guaranteed on a senior unsecured basis by each of the Company’s domestic subsidiaries that is a guarantor under our Credit Agreement.
Other Investing and Financing Activities Revolving Credit Facility and Senior Notes On August 23, 2023, the Company entered into a Second Amended and Restated Credit Agreement to increase the revolving credit facility from $500.0 million to $600.0 million, extend the maturity date from January 2, 2025 to August 23, 2028, and refinance and repay in full the remaining balance of the term loan then outstanding under the Amended and Restated Credit Agreement .
Other Investing and Financing Activities Revolving Credit Facility, Term Loan, and Senior Notes In August 2023, we entered into the Credit Agreement to increase our revolving credit facility from $500.0 million to $600.0 million, extend the maturity date of our revolving credit facility from January 2, 2025 to August 23, 2028, and refinance and repay in full the remaining balance of the term loan then outstanding under our prior credit facility.
When compared to the prior year, selling, general, and administrative expenses were relatively unchanged for the year ended December 31, 2023 as the elimination of costs from the storage tanks business were largely offset by increased compensation-related costs. 2022 versus 2021 • Operating costs decreased 1.8%.
When compared to the prior year, selling, general, and administrative expenses were relatively unchanged for the year ended December 31, 2023, as the elimination of costs from the storage tanks business were largely offset by increased compensation-related costs.
Excluding the impact of the storage tanks divestiture on both periods, operating profit increased $92.0 million, or 77.4%. • Operating profit in Construction Products increased primarily due to higher asset sale gains, increased pricing across the segment and the benefit recognized on a holdback obligation, partially offset by operating inefficiencies in our specialty materials business. • Excluding the impact of the storage tanks divestiture, operating profit in Engineered Structures increased by 16.1% primarily due to the recognition of the AMP tax credits, partially offset by a decline in volumes in our wind towers business and lower margins in our utility structure business. 41 Table of Contents • Operating profit in Transportation Products increased primarily due to higher volumes and improved margins in both inland barge and steel components. 2022 versus 2021 • Operating profit increased 225.3%, a large portion of which related to the $189.0 million gain on sale of the storage tanks business.
Excluding the impact of the storage tanks divestiture on both periods, operating profit increased $92.0 million, or 77.4%. • Operating profit in Construction Products increased primarily due to higher asset sale gains, increased pricing across the segment and the benefit recognized on a holdback obligation, partially offset by operating inefficiencies in our specialty materials business. • Excluding the impact of the storage tanks divestiture, operating profit in Engineered Structures increased by 16.1% primarily due to the recognition of the AMP tax credits, partially offset by a decline in volumes in our wind towers business and lower margins in our utility structure business. • Operating profit in Transportation Products increased primarily due to higher volumes and improved margins in both barge and steel components.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amount of existing assets and liabilities and their respective tax bases and other tax attributes using currently enacted tax rates.
Income Taxes The liability method is used to account for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amount of existing assets and liabilities and their respective tax bases and other tax attributes using currently enacted tax rates.
Any such adjustments are the result of subsequently obtaining additional information that existed at the acquisition date regarding the assets acquired or the liabilities assumed. Measurement period adjustments are generally recorded as increases or decreases to goodwill, if any, recognized in the transaction.
We may adjust the amounts recognized in an acquisition during a measurement period after the acquisition date. Any such adjustments are the result of subsequently obtaining additional information that existed at the acquisition date regarding the assets acquired or the liabilities assumed. Measurement period adjustments are generally recorded as increases or decreases to goodwill, if any, recognized in the transaction.
Cash Flows The following table summarizes our cash flows from operating, investing, and financing activities for each of the last three years: Year Ended December 31, 2023 2022 2021 (in millions) Total cash provided by (required by): Operating activities $ 261.0 $ 174.3 $ 166.5 Investing activities (285.8) 90.7 (570.3) Financing activities (30.8) (177.5) 380.9 Net increase (decrease) in cash and cash equivalents $ (55.6) $ 87.5 $ (22.9) 2023 versus 2022 Operating Activities.
Cash Flows The following table summarizes our cash flows from operating, investing, and financing activities for each of the last three years: Year Ended December 31, 2024 2023 2022 (in millions) Total cash provided by (required by): Operating activities $ 502.0 $ 261.0 $ 174.3 Investing activities (1,508.9) (285.8) 90.7 Financing activities 1,089.4 (30.8) (177.5) Net increase (decrease) in cash and cash equivalents $ 82.5 $ (55.6) $ 87.5 2024 versus 2023 Operating Activities.
The goodwill impairment is measured as the excess of the reporting unit's carrying value over its fair value, not to exceed the amount of goodwill allocated to the reporting unit.
If the carrying value of the reporting unit exceeds its fair value, an impairment loss is recognized. The goodwill impairment is measured as the excess of the reporting unit's carrying value over its fair value, not to exceed the amount of goodwill allocated to the reporting unit.
We believe that the assumptions used in our impairment analysis are reasonable; however, given the uncertainties of the economy and its potential impact on our businesses, there can be no assurance that our estimates and assumptions regarding the fair value of our reporting units will prove to be accurate predictions of the future.
See Note 1 and Note 6 to the Consolidated Financial Statements. 53 Table of Contents We believe that the assumptions used in our impairment analysis are reasonable; however, given the uncertainties of the economy and its potential impact on our businesses, there can be no assurance that our estimates and assumptions regarding the fair value of our reporting units will prove to be accurate predictions of the future.
Unsatisfied Performance Obligations (Backlog) As of December 31, 2023, the backlog for utility, wind, and related structures was $1,367.5 million compared to $671.3 million as of December 31, 2022.
Unsatisfied Performance Obligations (Backlog) As of December 31, 2024, the backlog for utility, wind, and related structures was $1,190.8 million compared to $1,367.5 million as of December 31, 2023.
Income Taxes The income tax provision for the years ended December 31, 2023, 2022, and 2021 was $36.7 million, $70.4 million, and $14.0 million, respectively. The effective tax rate for the years ended December 31, 2023, 2022, and 2021 was 18.7%, 22.3%, and 16.7%, respectively.
Income Taxes The income tax provision for the years ended December 31, 2024, 2023, and 2022 was $36.3 million, $36.7 million, and $70.4 million, respectively. The effective tax rate for the years ended December 31, 2024, 2023, and 2022 was 27.9%, 18.7%, and 22.3%, respectively.
The decrease in our effective tax rate for the year ended December 31, 2023 was largely due to AMP tax credits and the tax effects of foreign currency translations. For a reconciliation of the federal tax rate to our effective tax rate, see Note 10 to the Consolidated Financial Statements.
The increase in our effective tax rate for the year ended December 31, 2024 was largely due to state income taxes and the tax effects of foreign currency translations. For a reconciliation of the federal tax rate to our effective tax rate, see Note 10 to the Consolidated Financial Statements.
A reporting unit is considered to be at risk if its estimated fair value does not exceed the carrying value of its net assets by 10% or more. See Note 1 and Note 6 to the Consolidated Financial Statements.
A reporting unit is considered to be at risk if its estimated fair value does not exceed the carrying value of its net assets by 10% or more.
As a percent of revenues, cost of revenues decreased to 83.6% in the current year, compared to 89.2% in the prior year. • Selling, general, and administrative expenses increased 11.4%, primarily due to increased expenses from participation in trade remedy proceedings involving certain imports of freight rail couplers from China and Mexico, as well as higher compensation-related expenses, but decreased as a percentage of revenues to 5.9% in the current year, compared to 7.2% in the prior year. • Operating profit increased significantly, outpacing the percentage increase to revenues, driven by enhanced operating leverage associated with higher volumes and improved margins across both businesses. 2022 versus 2021 • Revenues increased 3.8% led by a 41.7% increase in steel components revenues due to increased deliveries resulting from improving demand conditions in the North American railcar market.
As a percent of revenues, cost of revenues decreased to 83.6% in the current year, compared to 89.2% in the prior year. • Selling, general, and administrative expenses increased 11.4%, primarily due to increased expenses from participation in trade remedy proceedings involving certain imports of freight rail couplers from China and Mexico, as well as higher compensation-related expenses, but decreased as a percent of revenues to 5.9% in the current year, compared to 7.2% in the prior year. 47 Table of Contents • Operating profit increased significantly, outpacing the percentage increase to revenues, driven by enhanced operating leverage associated with higher volumes and improved margins across the barge and steel components businesses.
At December 31, 2023, the Company had $33.7 million federal consolidated net operating loss carryforwards, primarily from businesses acquired, and $6.1 million of tax-effected state loss carryforwards remaining. In addition, the Company had $13.8 million of foreign net operating loss carryforwards that will begin to expire in the year 2024.
At December 31, 2024, the Company had $3.2 million federal consolidated net operating loss carryforwards, primarily from businesses acquired, and $4.5 million of tax-effected state loss carryforwards remaining. In addition, the Company had $7.7 million of foreign net operating loss carryforwards that will begin to expire in the year 2025.
Impairment losses on long-lived assets held for sale are determined in a similar manner, except that estimated fair values are reduced by the estimated cost to dispose of the assets. The Company had no impairment charges during the years ended December 31, 2023 or 2022.
Impairment losses on long-lived assets held for sale are determined in a similar manner, except that estimated fair values are reduced by the estimated cost to dispose of the assets.
The interest rate swap instrument expired in October 2023. See Note 3 and Note 7 to the Consolidated Financial Statements. 48 Table of Contents Stock-Based Compensation We have a stock-based compensation plan for our directors, officers, and employees. See Note 13 to the Consolidated Financial Statements.
The interest rate swap instrument expired in October 2023 and no new interest rate swap instrument has been entered into in connection with the Term Loan. See Note 3 and Note 7 to the Consolidated Financial Statements. Stock-Based Compensation We have a stock-based compensation plan for our directors, officers, and employees. See Note 13 to the Consolidated Financial Statements.
We believe, based on our current business plans, that our existing cash, available liquidity, and cash flow from operations will be sufficient to fund necessary capital expenditures and operating cash requirements for the foreseeable future.
The terms of each indenture also limit the ability of the Company’s non-guarantor subsidiaries to incur certain types of debt. We believe, based on our current business plans, that our existing cash, available liquidity, and cash flow from operations will be sufficient to fund necessary capital expenditures and operating cash requirements for the foreseeable future.
Excluding the impact of the storage tanks divestiture, revenues increased 12.4%. • Revenues from Construction Products increased primarily due to higher pricing across our aggregate and specialty materials businesses and additional revenues from our recent trench shoring acquisition. • Excluding the impact of the storage tanks divestiture, revenues from Engineered Structures increased 7.4% primarily due to increased volumes in our utility structures business, partially offset by lower pricing due to product mix, and lower volumes in our wind towers business. • Revenues from Transportation Products increased due to higher volumes in both inland barge and steel components. 2022 versus 2021 • Revenues increased by 10.1%. • Revenues from Construction Products increased primarily due to increased pricing across our aggregate and specialty materials businesses and higher volumes from recently acquired businesses. • Revenues from Engineered Structures increased primarily due to increased pricing in all product lines. • Revenues from Transportation Products increased primarily due to higher deliveries in steel components, partially offset by lower tank barge deliveries.
Excluding the impact of the storage tanks divestiture, which was completed in October 2022, revenues increased 12.4%. • Revenues from Construction Products increased primarily due to higher pricing across our aggregates and specialty materials businesses and additional revenues from the acquisition of a trench shoring business completed in the first quarter of 2023. 41 Table of Contents • Excluding the impact of the storage tanks divestiture, revenues from Engineered Structures increased 7.4% primarily due to increased volumes in our utility structures business, partially offset by lower pricing due to product mix, and lower volumes in our wind towers business. • Revenues from Transportation Products increased due to higher volumes in both our barge and steel components businesses.
We have established a valuation allowance for state and foreign tax operating losses and credits that we have estimated may not be realizable.
We have established a valuation allowance for state and foreign tax operating losses and credits that we have estimated may not be realizable. For additional information, see Note 10 to the Notes to Consolidated Financial Statements.
See Note 10 to the Consolidated Financial Statements for a further discussion of income taxes. 42 Table of Contents Segment Discussion Construction Products Year Ended December 31, Percent Change 2023 2022 2021 2023 versus 2022 2022 versus 2021 ($ in millions) Revenues: Aggregates and specialty materials $ 879.9 $ 821.4 $ 711.6 7.1 % 15.4 % Construction site support 121.4 102.1 85.2 18.9 19.8 Total revenues 1,001.3 923.5 796.8 8.4 15.9 Operating costs: Cost of revenues 783.9 736.3 630.1 6.5 16.9 Selling, general, and administrative expenses 107.0 100.4 89.9 6.6 11.7 Gain on disposition of property, plant, equipment, and other assets (28.2) (9.7) (6.4) Operating profit $ 138.6 $ 96.5 $ 83.2 43.6 16.0 Depreciation, depletion, and amortization $ 111.7 $ 102.7 $ 88.7 8.8 15.8 2023 versus 2022 • Revenues increased 8.4% primarily due to increased pricing across our product lines in our aggregates and specialty materials businesses.
Segment Discussion Construction Products Year Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 ($ in millions) Revenues: Aggregates and specialty materials $ 977.9 $ 879.9 $ 821.4 11.1 % 7.1 % Construction site support 127.2 121.4 102.1 4.8 18.9 Total revenues 1,105.1 1,001.3 923.5 10.4 8.4 Operating costs: Cost of revenues 864.0 783.9 736.3 10.2 6.5 Selling, general, and administrative expenses 116.2 107.0 100.4 8.6 6.6 Gain on disposition of property, plant, equipment, and other assets (9.8) (28.2) (9.7) Gain on sale of businesses (5.0) — — Impairment charge 5.8 — — Operating profit $ 133.9 $ 138.6 $ 96.5 (3.4) 43.6 Depreciation, depletion, and amortization $ 134.7 $ 111.7 $ 102.7 20.6 8.8 44 Table of Contents 2024 versus 2023 • Revenues increased 10.4% primarily due to recent acquisitions.
The commitment fee rate ranges from 0.20% to 0.35% and was set at 0.25% at December 31, 2023. The Company's revolving credit facility requires the maintenance of certain ratios related to leverage and interest coverage. As of December 31, 2023, we were in compliance with all such financial covenants.
As of December 31, 2024, the margin for borrowing based on SOFR was set at 2.50% and the commitment fee rate was set at 0.45%. The revolving credit facility portion of the Credit Agreement requires the maintenance of certain ratios related to leverage and interest coverage. As of December 31, 2024, we were in compliance with all such financial covenants.
Unsatisfied Performance Obligations (Backlog) As of December 31, 2023, the backlog for inland barges was $253.7 million compared to $225.1 million as of December 31, 2022. All of the backlog for inland barges is expected to be delivered during 2024.
Unsatisfied Performance Obligations (Backlog) As of December 31, 2024, the backlog for inland barges was $280.1 million compared to $253.7 million as of December 31, 2023. Approximately 92% of these unsatisfied performance obligations are expected to be delivered during 2025 and the remainder are expected to be delivered in 2026.
The Company also contributed to a multiemployer defined benefit pension plan under the terms of a collective-bargaining agreement that covered certain union-represented employees at one of our facilities. See Note 11 to the Consolidated Financial Statements.
The Company also contributed to various multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that covered certain union-represented employees at five of our facilities.
Other Income and Expense Other, net (income) expense consists of the following items: Year Ended December 31, 2023 2022 2021 (in millions) Interest income $ (4.7) $ (1.1) $ — Foreign currency exchange transactions (1.7) 3.3 0.6 Other (0.3) (0.4) (0.3) Other, net (income) expense $ (6.7) $ 1.8 $ 0.3 • Other, net expense due to foreign currency exchange transactions decreased by $5.0 million in 2023, primarily driven by increased volatility in the U.S. dollar to Mexican peso exchange rate as well as foreign currency impacts on the sale of the storage tanks business in Mexico.
For a further discussion of revenues, costs, and the operating results of individual segments, see Segment Discussion below. 43 Table of Contents Other Income and Expense Other, net (income) expense consists of the following items: Year Ended December 31, 2024 2023 2022 (in millions) Interest income $ (7.5) $ (4.7) $ (1.1) Foreign currency exchange transactions 4.3 (1.7) 3.3 Other (0.1) (0.3) (0.4) Other, net (income) expense $ (3.3) $ (6.7) $ 1.8 • Other, net expense due to foreign currency exchange transactions increased by $6.0 million in 2024, primarily driven by increased volatility in the U.S. dollar to Mexican peso exchange rate.
Net cash provided by operating activities for the year ended December 31, 2022 was $174.3 million compared to $166.5 million for the year ended December 31, 2021. • The changes in current assets and liabilities resulted in a net use of cash of $65.3 million for the year ended December 31, 2022 compared to a net use of cash of $50.3 million for the year ended December 31, 2021.
Net cash provided by operating activities for the year ended December 31, 2024 was $502.0 million compared to $261.0 million for the year ended December 31, 2023. • The changes in current assets and liabilities resulted in a net source of cash of $185.0 million for the year ended December 31, 2024 compared to a net use of cash of $71.8 million for the year ended December 31, 2023.
Transportation Products Year Ended December 31, Percent Change 2023 2022 2021 2023 versus 2022 2022 versus 2021 ($ in millions) Revenues: Inland barges $ 280.2 $ 189.9 $ 215.7 47.6 % (12.0) % Steel components 153.3 127.4 89.9 20.3 41.7 Total revenues 433.5 317.3 305.6 36.6 3.8 Operating costs: Cost of revenues 362.3 283.0 277.9 28.0 1.8 Selling, general, and administrative expenses 25.4 22.8 21.8 11.4 4.6 Gain on disposition of property, plant, equipment, and other assets — — (0.5) Operating profit $ 45.8 $ 11.5 $ 6.4 298.3 79.7 Depreciation and amortization $ 16.0 $ 15.8 $ 17.8 1.3 (11.2) 2023 versus 2022 • Revenues increased 36.6% due to higher volumes and improved pricing of inland barges and steel components. • Cost of revenues increased by 28.0% reflecting higher volumes during the current year.
Transportation Products Year Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 ($ in millions) Revenues: Inland barges $ 329.8 $ 280.2 $ 189.9 17.7 % 47.6 % Steel components 87.8 153.3 127.4 (42.7) 20.3 Total revenues 417.6 433.5 317.3 (3.7) 36.6 Operating costs: Cost of revenues 343.3 362.3 283.0 (5.2) 28.0 Selling, general, and administrative expenses 22.5 25.4 22.8 (11.4) 11.4 Loss on sale of businesses 21.6 — — Operating profit $ 30.2 $ 45.8 $ 11.5 (34.1) 298.3 Depreciation and amortization $ 12.6 $ 16.0 $ 15.8 (21.3) 1.3 2024 versus 2023 • Revenues decreased 3.7% resulting from the sale of the steel components business which was completed in August 2024.
Repurchase Program In December 2022, the Company’s Board of Directors (the “Board”) authorized a new $50.0 million share repurchase program effective January 1, 2023 through December 31, 2024 to replace a program of the same amount that expired on December 31, 2022. During the year ended December 31, 2023, the Company repurchased 200,000 shares at a cost of $13.8 million.
Repurchase Program In December 2024, the Board authorized a new $50.0 million share repurchase program effective January 1, 2025 through December 31, 2026 to replace a program of the same amount that expired on December 31, 2024.
The acquisition was funded with $60.0 million of borrowings under our revolving credit facility and cash on hand.
With operations in Alabama, California, and Oklahoma, Ameron is included in our Engineered Structures segment. The acquisition was funded with $160.0 million of borrowings under our revolving credit facility and cash on hand.
We periodically evaluate the carrying value of long-lived assets to be held and used for potential impairment whenever facts and circumstances indicate that the carrying amount of an asset or asset group may not be recoverable.
See Note 1 to the Consolidated Financial Statements for additional information regarding the ranges of estimated useful lives by category of property, plant, and equipment and intangible assets. We periodically evaluate the carrying value of long-lived assets for potential impairment whenever facts and circumstances indicate that the carrying amount of an asset or asset group may not be recoverable.
Unsatisfied Performance Obligations (Backlog) As of December 31, 2023 and 2022 our backlog of firm orders was as follows: December 31, 2023 December 31, 2022 (in millions) Engineered Structures: Utility, wind, and related structures $ 1,367.5 $ 671.3 Transportation Products: Inland barges $ 253.7 $ 225.1 Approximately 43% of the unsatisfied performance obligations for our utility, wind, and related structures in our Engineered Structures segment is expected to be delivered during 2024, approximately 27% is expected to be delivered during 2025, and the remainder is expected to be delivered through 2028.
See Note 10, “Income Taxes” to the Consolidated Financial Statements. • Net income for the year ended December 31, 2024 was $93.7 million compared with $159.2 million for the year ended December 31, 2023. 40 Table of Contents Unsatisfied Performance Obligations (Backlog) As of December 31, 2024 and 2023 our backlog of firm orders was as follows: December 31, 2024 December 31, 2023 (in millions) Engineered Structures: Utility, wind, and related structures $ 1,190.8 $ 1,367.5 Transportation Products: Inland barges $ 280.1 $ 253.7 Approximately 64% of the unsatisfied performance obligations for our utility, wind, and related structures in our Engineered Structures segment are expected to be delivered during 2025, approximately 13% are expected to be delivered during 2026, and the remainder are expected to be delivered through 2028.
Borrowings under the credit agreement are guaranteed by certain wholly owned subsidiaries of the Company. On April 6, 2021, the Company issued $400.0 million aggregate principal amount of 4.375% senior notes (the “Notes”) that mature in April 2029. Interest on the Notes is payable semiannually in April and October of each year.
Interest on the 2024 Notes is payable semiannually in February and August. In April 2021, the Company issued $400.0 million aggregate principal amount of 4.375% senior unsecured notes (the "2021 Notes", and together with the 2024 Notes, the "Senior Notes") that mature in April 2029. Interest on the 2021 Notes is payable semiannually in April and October.
Property, plant, and equipment are stated at cost and depreciated or depleted over their estimated useful lives, primarily using the straight-line method. Depletion of mineral reserves is calculated based on estimated proven and probable reserves using the units-of-production method on a quarry-by-quarry basis.
Depletion of mineral reserves is calculated based on estimated reserves using the units-of-production method on a quarry-by-quarry basis. Intangible assets, primarily consisting of customer relationships and permits, are recorded at fair value on the date of acquisition and amortized over their estimated useful lives using the straight-line method.
The quantitative goodwill impairment test is assessed at the “reporting unit” level by comparing the reporting unit's estimated fair value with the carrying amount of its net assets. If the carrying value of the reporting unit exceeds its fair value, an impairment loss is recognized.
Goodwill Goodwill is required to be tested for impairment annually or on an interim basis whenever events or circumstances change indicating that the carrying amount of the goodwill might be impaired. The quantitative goodwill impairment test is assessed at the “reporting unit” level by comparing the reporting unit's estimated fair value with the carrying amount of its net assets.
Changes in the assumptions used could have a significant impact on the estimated acquisition date fair value of the related asset and any future depreciation, depletion, or amortization expense. 49 Table of Contents The estimated remaining useful lives of acquired tangible and definite-lived intangible assets are based on the length of time that the assets are expected to provide value to the Company and have a significant impact on current and future period earnings.
Changes in the assumptions used could have a significant impact on the estimated acquisition date fair value of the related asset and any future depreciation, depletion, or amortization expense.
The estimates and judgments that most significantly affect the fair value calculations are assumptions, consisting of level three inputs, related to revenue and operating profit growth, discount rates, and exit multiples. 50 Table of Contents During the year ended December 31, 2023, the Company voluntarily changed its annual goodwill impairment assessment date from December 31st to October 1st.
The estimates and judgments that most significantly affect the fair value calculations consist of level three inputs related to revenue and operating profit growth and discount rates. The Company performs its annual goodwill impairment analysis as of October 1 of each year. As of December 31, 2024, goodwill totaled $1,361.2 million.
Operating Profit (Loss) Year Ended December 31, Percent Change 2023 2022 2021 2023 versus 2022 2022 versus 2021 (in millions) Construction Products $ 138.6 $ 96.5 $ 83.2 43.6 % 16.0 % Engineered Structures 95.7 307.0 88.0 (68.8) 248.9 Transportation Products 45.8 11.5 6.4 298.3 79.7 Segment Totals before Eliminations and Corporate Expenses 280.1 415.0 177.6 (32.5) 133.7 Corporate (62.8) (66.0) (70.3) (4.8) (6.1) Consolidated Total $ 217.3 $ 349.0 $ 107.3 (37.7) 225.3 2023 versus 2022 • Operating profit decreased 37.7%, driven by the divestiture of the storage tanks business.
Operating Profit (Loss) Year Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 (in millions) Construction Products $ 133.9 $ 138.6 $ 96.5 (3.4) % 43.6 % Engineered Structures 126.4 95.7 307.0 32.1 (68.8) Transportation Products 30.2 45.8 11.5 (34.1) 298.3 Segment Totals before Eliminations and Corporate Expenses 290.5 280.1 415.0 3.7 (32.5) Corporate (92.9) (62.8) (66.0) 47.9 (4.8) Consolidated Total $ 197.6 $ 217.3 $ 349.0 (9.1) (37.7) 2024 versus 2023 • Operating profit decreased 9.1%. • Excluding the $21.8 million gain recognized on the sale of depleted land in the prior period, operating profit in Construction Products increased 14.6% primarily due to the accretive impact of recently acquired businesses and operating improvements in our specialty materials and trench shoring businesses. • Operating profit in Engineered Structures increased by 32.1% primarily due to higher wind towers and utility structures volumes and the accretive impact of the acquired Ameron business. • Excluding the $21.6 million loss on the sale of the steel components business, operating profit in Transportation Products increased 13% primarily due to higher volumes and improved margins in barge, partially offset by lower steel components volumes. 2023 versus 2022 • Operating profit decreased 37.7%, driven by the divestiture of the storage tanks business.
As demonstrated by more than $1.1 billion of new orders for delivery through 2028, which we have received since the passage of the IRA, our wind tower business is at the beginning stages of a market recovery. A large portion of these orders will support wind energy expansion projects in the Southwest.
Since the passage of the IRA we have received new orders of $1.1 billion for delivery through 2028, a large portion of which will support wind energy expansion projects in the Southwest. As a result, we have opened a new plant in New Mexico and started delivering towers from this facility late in the second quarter of 2024.
Approximately 43% of the unsatisfied performance obligations for our utility, wind, and related structures in our Engineered Structures segment is expected to be delivered during 2024, approximately 27% is expected to be delivered during 2025, and the remainder is expected to be delivered through 2028.
Approximately 92% of the unsatisfied performance obligations for inland barges in our Transportation Products segment are expected to be delivered during 2025, and the remainder are expected to be delivered during 2026.
Corporate Year Ended December 31, Percent Change 2023 2022 2021 2023 versus 2022 2022 versus 2021 ($ in millions) Corporate overhead costs $ 62.8 $ 66.0 $ 70.3 (4.8) % (6.1) % 2023 versus 2022 • Corporate overhead costs decreased 4.8% primarily due to a $8.2 million reduction in acquisition and divestiture-related expenses, partially offset by higher compensation-related expenses. 2022 versus 2021 • Corporate overhead costs decreased 6.1% primarily due to a $1.1 million reduction in acquisition and divestiture-related expenses as well as by $8.7 million for a legal settlement recognized in 2021.
Corporate Year Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 ($ in millions) Corporate overhead costs $ 92.9 $ 62.8 $ 66.0 47.9 % (4.8) % 2024 versus 2023 • Corporate overhead costs increased 47.9% primarily due to a $30.5 million increase in acquisition and divestiture-related transaction expenses.
The methods for recognition of depreciation, depletion, and amortization are based on estimates regarding the expected future economic benefit to the Company and any potential impairment to the value of such assets could be significant. As such, the accounting treatment for these long-lived assets is a critical accounting policy.
The methods for recognition of depreciation, depletion, and amortization are based on estimates regarding the expected future economic benefit to the Company and any potential impairment to the value of such assets could be significant. Property, plant, and equipment are stated at cost and depreciated or depleted over their estimated useful lives, primarily using the straight-line method.
Excluding the impact of the divestiture in both periods, operating profit increased $12.4 million or 16.1% primarily due to $25.3 million of net benefit recognized from AMP tax credits in our wind towers business, partially offset by lower margins in our utility structures business, driven by product mix, and decreased wind tower volumes. 2022 versus 2021 • Revenues increased 7.3%, driven by increased pricing across all product lines, partially offset by lower overall volumes and the sale of the storage tanks business, which was completed on October 3, 2022. • Cost of revenues increased 5.2%, primarily driven by higher steel raw material prices, partially offset by lower overall volumes and the elimination of costs for storage tanks in the fourth quarter following the sale. • Selling, general, and administrative expenses were substantially unchanged as increased costs in utility structures were offset by the elimination of costs from storage tanks in the fourth quarter following the sale. 44 Table of Contents • Operating profit increased significantly, driven by the $189.0 million gain recognized on sale of our storage tanks business during the fourth quarter.
Excluding the impact of the divestiture in both periods, operating profit increased $12.4 million or 16.1% primarily due to $25.3 million of net benefit recognized from AMP tax credits in our wind towers business, partially offset by lower margins in our utility structures business, driven by product mix, and decreased wind tower volumes.
The Company also received proceeds of $100 million from borrowings under the revolving credit facility, of which $75 million were repaid during the year. • Dividends paid during the year ended December 31, 2022 were $9.8 million, unchanged from the prior year. • The Company paid $15.0 million during the year ended December 31, 2022 to repurchase common stock under the share repurchase program in effect at the time compared to $9.4 million paid during the year ended December 31, 2021.
These borrowings were paid in full during 2024, resulting in no outstanding loans borrowed under the revolving credit facility as of December 31, 2024. • Dividends paid during the year ended December 31, 2024 were $9.7 million, unchanged from the prior year. • During the year ended December 31, 2024, the Company did not repurchase any common stock under its share repurchase program compared to $13.8 million paid during the year ended December 31, 2023. 2023 versus 2022 Operating Activities.
This decrease was partially offset by higher compensation-related expenses. Liquidity and Capital Resources Arcosa’s primary liquidity requirement consists of funding our business operations, including capital expenditures, working capital investment, and disciplined acquisitions.
Excluding these expenses, corporate overhead costs were roughly flat. 2023 versus 2022 • Corporate overhead costs decreased 4.8% primarily due to a $8.2 million reduction in acquisition and divestiture-related transaction expenses, partially offset by higher compensation-related expenses. Liquidity and Capital Resources Arcosa’s primary liquidity requirement consists of funding our business operations, including capital expenditures, working capital investment, and disciplined acquisitions.
Engineered Structures Year Ended December 31, Percent Change 2023 2022 2021 2023 versus 2022 2022 versus 2021 ($ in millions) Revenues: Utility, wind, and related structures $ 873.5 $ 813.1 $ 717.9 7.4 % 13.3 % Storage tanks — 188.9 216.2 (100.0) (12.6) Total revenues 873.5 1,002.0 934.1 (12.8) 7.3 Operating costs: Cost of revenues 718.3 812.4 772.6 (11.6) 5.2 Selling, general, and administrative expenses 65.9 73.6 74.0 (10.5) (0.5) Gain on sale of storage tanks business (6.4) (189.0) — Gain on disposition of property, plant, equipment, and other assets — (2.0) (3.4) Impairment charge — — 2.9 Operating profit $ 95.7 $ 307.0 $ 88.0 (68.8) 248.9 Depreciation and amortization $ 26.6 $ 30.5 $ 33.1 (12.8) (7.9) 2023 versus 2022 • Revenues decreased 12.8% resulting from the sale of the storage tanks business, which was completed on October 3, 2022.
Excluding the gain, operating profit increased 27.2%, driven by increased pricing across the segment and the benefit recognized on a holdback obligation, partially offset by operating inefficiencies in our specialty materials business. • Depreciation, depletion, and amortization expense increased primarily due to recent acquisitions and organic growth investments. 45 Table of Contents Engineered Structures Year Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 ($ in millions) Revenues: Utility, wind, and related structures $ 1,047.3 $ 873.5 $ 813.1 19.9 % 7.4 % Storage tanks — — 188.9 — (100.0) Total revenues 1,047.3 873.5 1,002.0 19.9 (12.8) Operating costs: Cost of revenues 847.5 718.3 812.4 18.0 (11.6) Selling, general, and administrative expenses 88.4 65.9 73.6 34.1 (10.5) Gain on disposition of property, plant, equipment, and other assets (0.5) — (2.0) Gain on sale of businesses (14.5) (6.4) (189.0) Operating profit $ 126.4 $ 95.7 $ 307.0 32.1 (68.8) Depreciation and amortization $ 45.4 $ 26.6 $ 30.5 70.7 (12.8) 2024 versus 2023 • Revenues increased 19.9% primarily due to higher volumes in our wind towers and utility structures businesses and the contribution from the acquired Ameron business, partially offset by lower utility structures pricing due to product mix. • Cost of revenues increased 18.0% primarily due to higher wind tower and utility structures volumes and additional expenses incurred related to the startup of two new facilities during the year, including a concrete utility structures plant and a wind tower plant.
As of December 31, 2023, we had $160.0 million of outstanding loans borrowed and there were approximately $22.0 million of letters of credit issued under the revolving credit facility, leaving $418.0 million available for borrowing. The majority of our letter of credit obligations support the Company’s various insurance programs.
As of December 31, 2024, we had no outstanding loans borrowed and approximately $0.7 million of letters of credit outstanding under our revolving credit facility, which left $699.3 million available for borrowing.
As a percent of revenues, cost of revenues increased slightly. • Selling, general, and administrative expenses increased 11.7%, driven by additional costs from recently acquired businesses.
As a percent of revenues, cost of revenues decreased to 78.2% in the current period, compared to 78.3% in the prior period. • Selling, general, and administrative expenses increased 8.6%, due to additional costs from recently acquired businesses and higher compensation-related costs.
Management's estimates of fair value are based on assumptions believed to be reasonable, but which are inherently uncertain and, as a result, actual results may differ from estimates. We may adjust the amounts recognized in an acquisition during a measurement period after the acquisition date.
The estimated remaining useful lives of acquired tangible and definite-lived intangible assets are based on the length of time that the assets are expected to provide value to the Company and have a significant impact on current and future period earnings. 52 Table of Contents Management's estimates of fair value are based on assumptions believed to be reasonable, but which are inherently uncertain and, as a result, actual results may differ from estimates.
These items provide additional relevant information regarding the business of Arcosa, its strategy and various industry conditions which have a direct and significant impact on Arcosa’s results of operations, as well as the risks associated with Arcosa’s business. 39 Table of Contents Overall Summary Revenues Year Ended December 31, Percent Change 2023 2022 2021 2023 versus 2022 2022 versus 2021 ($ in millions) Construction Products $ 1,001.3 $ 923.5 $ 796.8 8.4 % 15.9 % Engineered Structures 873.5 1,002.0 934.1 (12.8) 7.3 Transportation Products 433.5 317.3 305.6 36.6 3.8 Segment Totals before Eliminations 2,308.3 2,242.8 2,036.5 2.9 10.1 Eliminations (0.4) — (0.1) Consolidated Total $ 2,307.9 $ 2,242.8 $ 2,036.4 2.9 10.1 2023 versus 2022 • Revenues increased by 2.9%.
Overall Summary Revenues Year Ended December 31, Percent Change 2024 2023 2022 2024 versus 2023 2023 versus 2022 ($ in millions) Construction Products $ 1,105.1 $ 1,001.3 $ 923.5 10.4 % 8.4 % Engineered Structures 1,047.3 873.5 1,002.0 19.9 (12.8) Transportation Products 417.6 433.5 317.3 (3.7) 36.6 Segment Totals before Eliminations 2,570.0 2,308.3 2,242.8 11.3 2.9 Eliminations (0.1) (0.4) — Consolidated Total $ 2,569.9 $ 2,307.9 $ 2,242.8 11.4 2.9 2024 versus 2023 • Revenues increased by 11.4%. • Revenues from Construction Products increased primarily due to the contribution from recent acquisitions. • Revenues from Engineered Structures increased primarily due to higher volumes in our wind towers and utility structures businesses and the contribution from the acquired Ameron business. • Revenues from Transportation Products decreased due to the sale of the steel components business, which was completed in August 2024, partially offset by higher volumes in our barge business. 2023 versus 2022 • Revenues increased by 2.9%.
Net cash provided by investing activities for the year ended December 31, 2022 was $90.7 million compared to net cash required of $570.3 million for the year ended December 31, 2021. • Capital expenditures for the year ended December 31, 2022 increased to $138.0 million compared to $85.1 million for the year ended December 31, 2021, driven by investment in various growth projects in our Construction Products and Engineered Structures segments. • Proceeds of $271.6 million were received during the year ended December 31, 2022 from the sale of the storage tanks business compared to $18.2 million for the year ended December 31, 2021 from the divestiture of an asphalt operation acquired as part of the StonePoint acquisition. • Proceeds from the sale of property, plant, and equipment and other assets totaled $32.2 million for the year ended December 31, 2022 compared to $20.0 million for the year ended December 31, 2021. • Cash paid for acquisitions, net of cash acquired, was $75.1 million for the year ended December 31, 2022 compared to $523.4 million during for the year ended December 31, 2021.
Net cash required by investing activities for the year ended December 31, 2024 was $1,508.9 million compared to $285.8 million for the year ended December 31, 2023. • Capital expenditures for the year ended December 31, 2024 decreased to $189.7 million compared to $203.5 million for the year ended December 31, 2023. • Proceeds from the sale of property, plant, and equipment and other assets totaled $18.3 million for the year ended December 31, 2024 compared to $36.6 million for the year ended December 31, 2023. • Cash paid for acquisitions, net of cash acquired, was $1,424.1 million for the year ended December 31, 2024 compared to $120.9 million for the year ended December 31, 2023. • Proceeds from the sale of businesses was $86.6 million during the year ended December 31, 2024, primarily driven by the sale of the steel components business, compared to $2.0 million during the year ended December 31, 2023.
Our customers remain committed to taking delivery of these orders. Barge order levels fell sharply at the onset of the COVID-19 pandemic and ensuing high steel prices further negatively impacted demand.
Our customers remain committed to taking delivery of these orders. Our barge business is recovering from cyclical lows resulting from the onset of the COVID-19 pandemic when order levels fell sharply due to high steel prices throughout 2022 and 2023. Over this time, customer inquiries have improved, initially for dry barges and more recently for tank barges.
Financial Operations and Highlights • Revenues for the year ended December 31, 2023 increased 2.9% to $2.3 billion compared to the year ended December 31, 2022, driven by higher revenues in Construction Products and Transportation Products, partially offset by lower revenues in Engineered Structures resulting from the divestiture of the storage tanks business on October 3, 2022, which contributed $188.9 million to revenues in the prior year. • Operating profit for the year ended December 31, 2023 of $217.3 million decreased $131.7 million compared to the year ended December 31, 2022 due to the divestiture of the storage tanks business, which resulted in a net decrease of $223.7 million year-over-year.
Financial Operations and Highlights • Revenues for the year ended December 31, 2024 increased 11.4% to $2.6 billion compared to the year ended December 31, 2023, driven by higher revenues in Engineered Structures and Construction Products, partially offset by lower revenues in Transportation Products resulting from the divestiture of the steel components business. • Operating profit for the year ended December 31, 2024 of $197.6 million decreased $19.7 million primarily due to increased acquisition and divestiture-related transaction expenses recognized in Corporate costs, the impact of the fair value markup of acquired inventory and long-lived assets, and a $21.8 million gain recognized on the sale of depleted land in the prior year. • As a percentage of revenues, selling, general, and administrative expenses was 12.5% for the year ended December 31, 2024, compared to 11.3% in the prior year, driven by increased costs from recently acquired businesses and higher acquisition and divestiture-related transaction expenses. • The effective tax rate for the year ended December 31, 2024 was 27.9% compared to 18.7% for the year ended December 31, 2023.
Contractual Obligations and Commercial Commitments As of December 31, 2023, we had the following contractual obligations and commercial commitments: Contractual Obligations and Commercial Commitments Total Next 12 Months Beyond 12 Months (in millions) Debt $ 560.0 $ — $ 560.0 Operating leases 41.3 9.4 31.9 Finance leases 13.8 7.2 6.6 Obligations for purchase of goods and services 198.9 153.2 45.7 Total $ 814.0 $ 169.8 $ 644.2 See Note 15 to the Consolidated Financial Statements.
See Note 11 to the Consolidated Financial Statements. 51 Table of Contents Contractual Obligations and Commercial Commitments As of December 31, 2024, we had the following contractual obligations and commercial commitments: Contractual Obligations and Commercial Commitments Total Next 12 Months Beyond 12 Months (in millions) Debt $ 1,700.0 $ 7.0 $ 1,693.0 Operating leases 99.1 13.0 86.1 Finance leases 7.4 5.4 2.0 Obligations for purchase of goods and services 245.5 183.8 61.7 Total $ 2,052.0 $ 209.2 $ 1,842.8 In the normal course of business, at December 31, 2024, the Company was contingently liable for $141.5 million in surety bonds, which guarantee its own performance and are required by certain states and municipalities and their related agencies.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeIf interest rates average one percentage point more in fiscal year 2024 than they did during 2023, our interest expense would increase by $1.6 million. In comparison, at December 31, 2022, we estimated that an average increase of one percentage point would increase interest expense by $0.4 million, after considering the effects of interest rate hedges.
Biggest changeAs of December 31, 2024, we had no outstanding loans borrowed under the revolving credit facility and the Term Loan had a balance of $700.0 million . If interest rates average one percentage point more in fiscal year 2025 than they did during 2024, our interest expense would increase by $7.0 million.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Our earnings could be affected by changes in interest rates due to the impact those changes have on our variable rate revolving credit facility. As of December 31, 2023, we had $160.0 million of outstanding loans borrowed under the revolving credit facility.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Our earnings could be affected by changes in interest rates due to the impact those changes have on our variable rate revolving credit facility and Term Loan.
As of December 31, 2023, we had $400.0 million outstanding on our 4.375% senior notes (the "Notes") due 2029. The Notes have a 4.375% fixed annual interest rate and, therefore, our economic interest rate exposure is fixed. However, the values of the Notes are exposed to interest rate risk.
In comparison, at December 31, 2023, we estimated that an average increase of one percentage point would increase interest expense by $1.6 million. As of December 31, 2024, we had $400.0 million outstanding on our 4.375% 2021 Notes due 2029. The 2021 Notes have a 4.375% fixed annual interest rate and, therefore, our economic interest rate exposure is fixed.
We estimate that a one percentage point increase in market interest rates would decrease the fair value of the Notes by approximately $16.7 million. We carry the Notes at face value less unamortized discount on our Consolidated Balance Sheet and present the fair value for disclosure purposes only.
We carry the 2021 Notes at face value less unamortized discount on our Consolidated Balance Sheet and present the fair value for disclosure purposes only. As of December 31, 2024, we had $600.0 million outstanding on our 6.875% 2024 Notes due 2032.
In addition, we are subject to market risk related to our net investments in our foreign subsidiaries. The net investment in foreign subsidiaries as of December 31, 2023 was $125.8 million. The impact of such market risk exposures as a result of foreign exchange rate fluctuations has not been significant to Arcosa.
The impact of such market risk exposures as a result of foreign exchange rate fluctuations has not been significant to Arcosa. See Note 9 to the Consolidated Financial Statements. 57 Table of Contents
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See Note 9 to the Consolidated Financial Statements. 55 Table of Contents
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However, the values of the 2021 Notes are exposed to interest rate risk. We estimate that a one percentage point increase in market interest rates would decrease the fair value of the 2021 Notes by approximately $13.9 million.
Added
The 2024 Notes have a 6.875% fixed annual interest rate and, therefore, our economic interest rate exposure is fixed. However, the values of the 2024 Notes are exposed to interest rate risk. We estimate that a one percentage point increase in market interest rates would decrease the fair value of the 2024 Notes by approximately $34.6 million.
Added
We carry the 2024 Notes at face value less unamortized discount on our Consolidated Balance Sheet and present the fair value for disclosure purposes only. In addition, we are subject to market risk related to our net investments in our foreign subsidiaries. The net investment in foreign subsidiaries as of December 31, 2024 was $130.2 million.

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